ALTERNATIVE BID VARIABLES AS INSTRUMENTS OF OCS LEASING POLICY

Prior to 1979, a cash bonus was used almost exclusively as the bid variable at outer continental shelf (OCS) lease auctions. Criticisms of the cash bonus as a bid variable led to the OCS Lands Act Amendments of 1978 which stipulated that alternative bid variables be employed on a portion of the leases issued over a five-year trial period. The alternative bid variables include net profit share, royalty rate, and work commitment
Each of these bid variables is analyzed to determine the extent to which it (a) promotes economic efficiency, (b) returns fair market value to the government, (c) identifies and selects the most efficient firm to operate the lease, (d) promotes optimal risk sharing between the lessee and the government, and (e) minimizes administrative costs
This analysis has led the authors to conclude that while no bid variable is perfect, the traditional cash bonus is preferred     

Management Behaviour in Vietnamese Commercial Banks

This study identifies managerial behaviour in Vietnamese banks between the years 2000 and 2014, based on the managerial framework of banks, as identified by Rossi et al. ( 2009 ). This framework is built on the interrelationships between efficiency, risk, capital and diversification. This study uses the Z‐score to measure insolvency risk, the SFA to estimate cost efficiency, the ratio of total equity to total assets to capture bank capital and the HHI index to measure the diversification of revenue and earning assets. The results from the 3SLS estimator indicate that revenue diversification has an insignificant impact on insolvency risk, capital ratio and cost efficiency, but earning assets diversification has a negative effect on these three variables, supporting ‘classical diversification’, ‘economic capital’ and ‘monitoring’ behaviours. Moreover, a decline in cost efficiency leads to a rise in insolvency risk, implying ‘bad management’ behaviour; an increase in risk results in a reduction in cost efficiency, indicating ‘bad luck’ behaviour; and a reduction in capital ratio in the poorly capitalised banks leads to a growth in risk, suggesting ‘moral hazard’ behaviour. The results remain strongly robust when using an alternative risk measurement (the loan loss provision ratio) and an alternative SFA model.     

On the determinants of local government performance: A two-stage nonparametric approach

This article analyzes the efficiency of local governments in the Comunitat Valenciana (Spain) and their main explanatory variables. The analysis is performed in two stages. Firstly, efficiency is measured via (nonparametric) activity analysis techniques. Specifically, we consider both Data Envelopment Analysis (DEA) and Free Disposable Hull (FDH) techniques. The second stage identifies some critical determinants of efficiency, focusing on both political and fiscal policy variables. In contrast to previous two-stage research studies, our approach performs the latter attempt via nonparametric smoothing techniques, rather than econometric methods such as OLS or Tobit related techniques. Results show that efficiency scores, especially under the nonconvexity assumption (FDH), are higher for large municipalities. Thus, there is empirical evidence to suggest that resources may be better allocated by large municipalities. However, the inefficiency found is not entirely attributable to poor management, as second-stage analysis reveals both fiscal and political variables to be explicably related to municipality performance. Moreover, the explanatory variables’ impact on efficiency is robust to the chosen technique—either convex DEA or nonconvex FDH.     

中国金融发展与技术效率改善——基于工业制成品行业面板数据的经验研究

技术效率改善对于中国经济效率进一步的提高具有决定性作用。基于2001～2007中国国有及规模以上非国有工业制成品行业面板数据,本文在Malmquist指数法下测算了技术效率改善指数。利用该指数,本文进一步检验了金融发展与技术效率改善的联系。经验结果表明,金融发展促进了技术效率改善,而在外源融资依赖度高的行业,这种促进效应更加明显。     

The relative economic efficiency of urban water utilities in regional New South Wales and Victoria

In recent times the relative economic efficiency of urban water utilities has been neglected as policymakers sought to secure urban water supplies. This paper is an effort to measure the efficiency consequences of a number of recent urban water policy initiatives. Data Envelopment Analysis (DEA) is employed in order to measure the relative technical efficiency of urban water utilities in regional New South Wales (NSW) and Victoria. We show that the almost universal policy of water restrictions is likely to reduce relative efficiency and the typically larger utilities located in Victoria are characterised by a higher degree of managerial efficiency. A number of implications for urban water policy are advanced.     

Risk management and dynamic network performance: an illustration using a dual banking system

This study applies dynamic network data envelopment analysis to compare a dual banking system, namely conventional and Islamic banks, with emphasis on risk measures. Non-oriented, variable return-to-scale dynamic network slacks-based measure is used to model the banking performance for the period 2008–2012. Under the consideration of risk measures, the findings highlight that Islamic banks excel in managerial efficiency while conventional banks surpass in profitability efficiency. Furthermore, the regression results find that the number of directors on the risk management committee has a positive impact on banking performance. Meanwhile, the high number of independent directors improves the profitability efficiency but worsens the managerial efficiency.     

Technological Progress versus Efficiency Gain in Manufacturing Sectors

This study decomposes the nonparametric Malmquist productivity index for 36 Korean manufacturing sectors into two components: technological change and technical efficiency change. The empirical results show that while each sector displays quite different growth patterns, productivity growth is dominated by technological change. Technological change is found to have a negative correlation with efficiency change. Secondary regression performed in this study identifies the relationship between productivity growth measures and several key policy variables, such as effective protection rate, market concentration, and so forth. The productivity estimates are compared with those of the conventional Törnqvist productivity index.     

Empirical constitutional economics: Onward and upward?

Empirical constitutional economics has made a huge leap forward over the last decade. Interesting insights into the effects of constitutions have been discovered. Rather than summarizing the state of the art, this paper identifies some of the current shortcomings and proposes a number of extensions. It calls for recognizing additional constitutional institutions as explanatory variables, as well as the incorporation of additional dependent variables. Its major emphasis is, however, on calling for the next logical step in this field, namely to endogenize constitutions.     

From command-and-control to market-based environmental policies: Optimal transition timing and China’s heterogeneous environmental effectiveness

Despite the rich literature on command-and-control and market-based environmental policies, the transition between them has received relatively less attention. This paper identifies that there exists an optimal transition timing from command-and-control policies to market-based policies by analyzing the trade-off between the abatement cost and innovation compensation effects of environmental regulations, and the optimal transition timing occurs when the marginal opportunity cost of pollution abatement equals the marginal output of capital input. Using province-level data of 30 regions in China from 2007 to 2015, we measure environmental efficiency by the slack-based model with desirable and undesirable output, and adopt the spatially adaptive semi-parametric model to carry out our empirical research, which shows that command-and-control policies, rather than market-based policies, promote China’s environmental efficiency. Enhancing investment in technological innovation contributes to improving environmental efficiency for both types of policies. Finally, the effect of such policies on environmental efficiency remains heterogeneous across regions.     

A lower bound on computational complexity given by revelation mechanisms

Summary This paper establishes a lower bound on the computational complexity of smooth functions between smooth manifolds. It generalizes one for finite (Boolean) functions obtained (by Arbib and Spira [2]) by counting variables. Instead of a counting procedure, which cannot be used in the infinite case, the dimension of the message space of a certain type of revelation mechanism provides the bound. It also provides an intrinsic measure of the number of variables on which the function depends. This measure also gives a lower bound on computational costs associated with realizing or implementing the function by a decentralized mechanism, or by a game form.This research was supported by National Science Foundation Grant No. IRI-9020270.     

The efficiency of immunization of infants by local government

The paper makes use of data envelopment analysis (DEA) to measure the cost and production efficiency of local government programmemes for childhood immunization in urban and rural settings in Australia. Model specification is tested for validity, methods are used for ranking efficient units and advanced statistical methods are used to establish confidence intervals around the efficiency estimates. Given the small data set, the cost and production models are valid, and it is concluded that while neither urban nor rural programmes are particularly efficient, there is more room for improvement in rural programmes. Ways of changing methods of delivery are suggested which may increase efficiency.     

Market power and fiscal policy in OECD countries

We compute average markups as a measure of market power throughout time and study their interaction with fiscal policy and macroeconomic variables in a VAR framework. From impulse-response functions, the results, with annual data for a set of 14 OECD countries, show that the markup (i) depicts a pro-cyclical behaviour with productivity shocks and (ii) a counter-cyclical behaviour with fiscal spending shocks. We also use a PVAR, increasing the efficiency in the estimations, which confirms the country-specific results.     

The Augmented Solow Model with Mincerian Schooling and Externalities

Abstract. We combine the augmented Solow model with the Mincer equation to derive a specification that identifies an education externality within a production function framework. The previous empirical literature has not reached a consensus about the size of the education externality, which is given by the difference between the microeconomic and the macroeconomic return to education. Relative to our benchmark value that is based on a parameterization of the derived specification, we find that the estimated education externality is too large when the empirical model is not properly restricted, and appears to be absent when all control variables of the empirical model are properly accounted for. We note that the absence of an education externality is difficult to reconcile with observed levels of education subsidies for efficiency reasons.     

RESTORATION-BASED COMPENSATION MEASURES IN NATURAL RESOURCE LIABILITY STATUTES

In the past two decades, the U.S. Congress has passed several major environmental statutes that designate natural resource management agencies as trustees of the resources on behalf of the public and that allow the trustees to recover damages for injuries to public resources from releases of hazardous substances and discharges of oil.
The standard measure of damages in the various statutes is the cost of restoring the resources to baseline conditions ("primary restoration") plus the interim loss in alue from the time of the incident until full recovery from the injuries. However, trustees are allowed to spend their damage recoveries only on enhancing or creating ("restoring, rehabilitating, replacing or acquiring the equivalent of") natural resources. The statutory restriction on the use of the recoveries has motivated the development of an alternative measure of damages for interim losses—the cost of "compensatory restoration" actions providing in-kind compensation—which the National Oceanic and Atmospheric Administration (NOAA) incorporated in its 1996 regulations implementing the natural resource liability provisions of the Oil Pollution Act (OPA).
This analysis first identifies the statutory measure of damages and the traditional framing of damages for interim losses (monetary compensation). It then defines an alternative utility-theoretic measure of resource compensation and identifies alter-native methods of implementation.     

The Measurement of the Utilisation Efficiency of External Debt Funds and Its Influencing Factors

This paper uses stochastic frontier analysis to measure the utilisation efficiency of external debt funds, and identifies what factors actually influence the utilisation efficiency of external debt funds. Measurements show that in both developing and developed countries, the utilisation efficiency of external debt funds shows a downward trend; this downward trend is more obvious in developed countries. Empirical analysis found that the trade deficit rate, the trade openness, the ratio of fiscal revenue to gross domestic product (GDP), and the inflation rate have a significant negative effect on the utilisation efficiency of external debt funds. The ratio of money and quasi money (M2) to GDP, the ratio of the population aged 15–65 to total population, the ratio of industry value‐added to GDP, and the investment growth rate have a significant positive effect on the utilisation efficiency of external debt funds. Furthermore, under the condition of high ratio of the population aged 15–65 to total population, an increase in the ratio of the population aged 15–65 to total population will have a larger effect on improving the utilisation efficiency of external debt funds. Under the condition of high trade deficit rate, an increase in trade deficit rate will have a bigger effect on decreasing the utilisation efficiency of external debt funds.     

An innovation index based on factor analysis

Factor analysis techniques are applied to develop an innovation index which indicates the relative tendency of various industrial sectors to innovate. The index is derived from various input variables which reflect the extent to which resources are allocated to achieve innovation and output variables which measure the extent to which new product and process innovation is achieved. In constructing the innovation index, each of the variables is weighted in accordance to its involvement in factor patterns which best reproduce correlations in the set of statistics. The innovation index is applied to rank-order various industrial sector and changes in innovation characteristics over time are indicated by index values determined for 1960, 1963 and 1970. Relationships are established between values of the innovation index and interindustry differences in the dynamics of the development of markets created through technological innovation. Application of these relationships for projecting the rate at which markets will develop for new technological innovations is discussed.     

Applying DEA, MPI, and grey model to explore the operation performance of the Taiwanese wafer fabrication industry

The study applies data envelopment analysis (DEA) and Malmquist productivity index (MPI) to explore the operation performances of the Taiwanese wafer fabrication companies from 2004 to 2007. The input variables are total assets, operation costs, and selling and administrative expenditures, while the output variable is net sales. The results show that if Taiwanese wafer fabrication companies want to increase their operation performances, they should improve their CRS and VRS efficiencies not scale efficiency. Furthermore, this paper utilizes GM (1,1) - one order and one variable in the grey model - to forecast the growth trend of the Taiwanese wafer fabrication industry from 2008 to 2010, and then employs GM (1,N) - one order and N variables in the grey model - to measure the influences of the input variables upon the output variable. This study demonstrates that the most influential factor for the output variable, net sales, is selling and administrative expenditures.     

先进制造业绿色技术创新效率及其环境规制门槛效应

利用非强制性幅度调整与随机前沿函数构建先进制造业绿色技术创新三阶段效率测度模型,引入经济水平、公众素质、政府扶持强度作为环境变量,基于全国内地30个省市2006-2016年先进制造业面板数据对其绿色技术创新效率进行测度,同时选取门槛计量模型解析正式、非正式环境规制的影响机理。结果表明,效率评估中规制因素与统计噪音可造成测度结果产生偏差,环境变量对投入与产出松弛存在差异性波动影响,而松弛变量调整前后可使多数地区绿色技术创新效率排名发生改变;在全国先进制造业绿色技术创新效率整体呈稳步提升态势下,总体效率依然偏低,而且在空间布局上形成“三大梯度”,具备显著的“都市联动效应”;正式与非正式环境规制对先进制造业绿色技术创新效率均存在单门槛值,但分别呈“U”型与倒“U”型关系,而资本密集度、行业利润率等对先进制造业绿色技术创新效率均呈显著正向推进作用。     

Determinants of bank cost efficiency in transition economies: evidence for Latin America,Central and Eastern Europe and South-East Asia

In this study, we adopt Wang’s (2002) heteroscedastic stochastic frontier model, which allows us to investigate bank cost efficiency and to measure the marginal effects of some variables on both the level and the variability of inefficiency. In recent years, the financial crisis has significantly affected the banking systems of the transition countries. Hence, the efficiency is of major importance for the stability of the banks. Regarding the determinants of efficiency, we find evidence that banks that follow a more cautious strategy, characterized by lower risk appetite and average expectations on profitability, have higher cost efficiency. We also find that traditional deposit-taking and loan-making still remain the most efficient activity of the banks. Additionally, the results showed that a higher Gross Domestic Product growth rate implies an increase in the inefficiency level, indicating an unsustainable bank management behaviour, which in periods of economic growth adopts policies that can generate inefficiency in order to gain market share and to obtain higher bonuses. Country cost efficiency results show significant differences. The banking systems in transition countries in South Eastern Asia appear to have a higher cost efficiency level. Also, the effects of the financial crisis were less significant in this region.     

Differentiating Between Dimensionality and Duration in Multidimensional Measures of Poverty: Methodology with an Application to China

We develop a multidimensional poverty measure that is sensitive to the within‐individual distribution of deprivations across dimensions and time. Our measure combines features from a static multidimensional measure (Alkire and Foster, 2011a ) and a time‐dependent unidimensional measure (Foster, 2009 ). The proposed measure separately identifies—and can therefore be decomposed according to—the proportion of the poverty score attributable to: (i) the concentration of deprivations within periods; (ii) the concentration of deprivations within dimensions. In doing so it allows for a poverty ranking that is robust to assumptions about the trade‐off between the two components. Previous measures have not allowed for the features proposed here due to the inability to calculate the exact contribution of each dimension to overall poverty. We overcome this by adapting to our measure the Shapley decomposition proposed in Shorrocks ( 2013 ) (based on Shapley, 1953 ). The measure is applied to data from China, 2000‐2011.