The dynamics of wealth,profit, and sustainable advantage

This paper shows how idiosyncratic resources can drive sustained profitability and persistent heterogeneity under competitive conditions. Generic inputs purchased in the market become idiosyncratic resources as the result of firms' investments in customization. Analytically, we show how heterogeneous firms coexist in equilibrium as a function of customization costs. Computationally, we show that sustainable profits can emerge without ‘monopolistic’ imperfections. We consider how capability heterogeneity, resource customization cost, and ease of expansion interact to drive short-run and sustainable profits. Our results illustrate that sustainable profits may represent a small part of the total wealth created over time by a firm or industry, and that changes in factors shaping a sector's evolutionary trajectory may be more important than changes in factors that determine profits' ultimate sustainability. Copyright © 2012 John Wiley & Sons, Ltd.     

Foreign determinants of local institutions: Spatial dependence and openness

There are both empirical and theoretical arguments for the thesis that foreign factors have an impact on domestic institutional quality. Yet the literature is divided over whether exposure (openness to the world economy) or the kind of institutions in surrounding countries (relative location) determines the quality of local institutions. This paper confronts these hypotheses empirically, addressing the issues of strong cross-sectional dependence and the endogeneity of openness. In a 107-country cross-section, both trade openness and relative location have a positive impact on local institutions. The institutional quality of neighbouring countries is not found to be statistically significant when considering openness to foreign direct investments instead of trade, but the statistical performance of that model is poorer.     

Economic restructuring and state intervention in Holdenist suburbia: understanding urban poverty in Australia

From the mid-1940s to the mid-1960s a particular conjuncture of capital-state relations formed in Australia, leading to the development of a distinctive urban form —‘Holdenist suburbia’: built by government; of a large scale and uniform appearance; constructed of poor quality, cheap materials; home to relatively high percentages of public renters; comprised of predominantly working-class families; adjacent to manufacturing employment; and stigmatized. An examination of one such Holdenist suburban estate in 1966 and 1991 illustrates how certain aspects of economic restructuring and state intervention have forged such spaces as sites of urban poverty. With the broad aim of connecting Australian urban studies to ongoing international debates about the nature of contemporary urban poverty, it is noted that distinctive characteristics of Australian urban and welfare state development render the application of concepts derived from different cultural settings problematic. This paper makes two points. First, a ‘finer-combed’ interpretation of Australian postwar suburban development is required to delineate the role of the state in shaping a particular urban form during this period — the Holdenist suburban form. Second, this delineation is particularly important to understanding contemporary urban poverty in Australia, for the social provisions of state policy have, in contradictory fashion, both prevented the full development of outcast ghettos (Marcuse, 1996) and, in conjunction with the processes of economic restructuring, forged sites of urban poverty.     

Studiengebühren: Ein Weg aus der Bildungskrise?

Das Urteil des Bundesverfassungsgerichts vom Januar 2005 hat die Tür zu Studiengebühren geöffnet. Damit ist eine notwendige Bedingung für eine fundamentale Hochschulreform erfüllt. Welche verteilungs– und bildungspolitischen Folgen hat die derzeitige Hochschulfinanzierung? Wie sind demgegenüber Studiengebühren zu bewerten? Wie ließe sich der Wettbewerb zwischen den Hochschulen verbessern?Prof. Dr. Charles B. Blankart, 62, lehrt Öffentliche Finanzen an der Humboldt-Universität zu Berlin. Er ist Mitglied des Wissenschaftlichen Beirats beim Bundesministerium für Wirtschaft und Arbeit und Mitglied des Wissenschaftlichen Arbeitskreises für Regulierungsfragen bei der Regulierungsbehörde für Telekommunikation und Post (WAR); Gerrit B. Koester, 31, Dipl.-Volkswirt, Dipl.-Pol., ist wissenschaftlicher Mitarbeiter am Institut für öffentliche Finanzen der Humboldt-Universität; und Sascha G. Wolf, 29, Dipl.-Volkswirt, ist Mitarbeiter an demselben Institut sowie bei der Stiftung Marktwirtschaft.     

Integration erneuerbarer Energien in die deutsche Stromversorgung im Zeitraum 2015�C2020 mit Ausblick auf 2025

The dena grid study II examines the integration of renewable energies into Germany??s electricity supply up to the year 2020 and gives a qualified outlook up to 2025. The study develops geographically differentiated scenarios for installed wind power capacity, on the basis of which time series of the wind power feed-in into high and extra high voltage nodes and offshore wind farms are generated. Future requirements for the transmission grid and grid extension options are analysed. Opportunities to introduce more flexibility in the power system in terms of supply and demand are examined. The study gives a conceptual perspective of the need for grid extension in inner Germany in order to fully integrate renewable energies, whilst operating power stations at optimum cost and exchanging electricity with other countries in response to market demands within the scope of the specified transmission capacities.