Regulatory risk,investment, and welfare

This paper assesses the allocative and distributional effects of uncertain regulatory constraints on rate of return, on price, and on competitive entry. A profit-maximizing firm responds to rate-of-return risk by substituting variable factors for sunk investment, but expands capacity when faced with either price risk or entry risk. Investors gain from the elimination of regulatory risk, a result that parallels Peltzman's contention that regulators could raise investor wealth by reducing risk. Consumers benefit from price and entry risk, but only under severe restrictions on tastes and technology. An inherent feature of government intervention, regulatory risk should be taken into account when comparing alternative policies for regulating (or deregulating) an industry.     

Civil Service Reform in the Republic of Ireland

This article sets out the background to the current management reforms in the Irish civil service, and identifies some of the key features of the programme 'Delivering Better Government'. It explores how the programme relates to international developments in public service provision, and describes some of the challenges to be faced if the programme is to become reality.     

An interindustry analysis of merger activity 1960 – 1983

This paper highlights several trends in merger activity in mining and manufacturing, and commercial banking in the United States for the period 1960 to 1983. The specific data examined included commercial bank mergers by types (horizontal, market extension), by corporate structure of the acquiring organization, and by regulatory authority providing final approval of these mergers. Over the time period analyzed, significant differences appear to exist between the magnitude and the timing of mining and manufacturing as compared to commercial bank mergers. These differences may result largely from changes in long-existing legislation in the banking sector, particularly those in recent decades.     

Estimation in sequential decisionmaking models: A methodological note

The purpose of this note is to develop an appropriate model of behavior and a statistical technique for estimating it for individuals who make sequential decisions under uncertainty. The distinctive aspect of this model is that differences among individuals are reflected in their behavior rather than being swept into the error term.     

The impact of variance estimation in option valuation models

This paper examines some implications of using an estimate of the variance in option valuation models. This procedure produces biased option values. It is shown that the magnitude of this bias is not large. The dispersion induced in the option price is more significant particularly for parameter values of practical interest. The nature and extent of this dispersion is examined by numerical examples. The paper suggests how a Bayesian approach could be used to cope with the estimation error.     

An introduction to the Millennium Project

The pace, complexity, and globalization of change requires attention to the future. The change of millennia — the coming of the year 2001 — provides an opportunity, a psychological focus, for a global review of past achievements and problems and a unique chance to assess and reflect on future issues and opportunities.Unfortunately, there is as yet no mechanism or information utility to support a worldwide effort to study past achievements and problems or future issues and opportunities. Although there are many individual, isolated, special purpose, and one-time study efforts underway, there is no international system that can provide coherence or continuity to these studies, including feedback and sharing of information, and, in particular, the systematic exploration of future possibilities and policy alternatives. With growing interest in the future, the spread of instantaneous and global communications, the advent of powerful new nondeterministic modeling techniques, the ability to evoke, capture, and share information and perceptions with systematic questioning techniques and software, the proliferation of data bases, and knowledge visualization, it is now possible for futurists, scholars and others around the world to interact globally and take a fresh look at the future possibilities and policies in ways not previously possible.As the World Bank provides an ongoing system for research and feedback to improve economic policy, so too the United Nations University could provide an ongoing system for the improvement of futures research and its application to the policy process. According to a series of interviews, questionnaires, and meetings with leading futurists and scholars around the world, the proposed “Millenium Project” has the potential to become such a system.This study had as its principal objective determining the design of an information system that could effectively tap contributors, worldwide, to focus on lessons of the past that bear on world issues and the potential of future developments for intensifying or mitigating these and future issues. The first phase of the feasibility study was both methodological and substantive. Worldwide panels of experts contributed their judgments about the method or process of organizing the project; and the system that emerged from this interaction was applied in a prototype study to the issues of growing world population and the environment.During the first phase of the feasibility study, we found that:

1. 1. The Millennium Project is feasible and likely to be helpful to many institutions in examining and resolving policy issues at several levels. An overview of the project design and objectives appears in Section 2 of this article.

2. 2. Organizations that have an issues scanning function, or have a mandate to keep abreast of a broad range of futures thinking, have a need for access to a non-political, scholarly, and international system of future studies. Such organizations have requested continued participation in the second and third phase of this feasibility study, as well as establishing formal relations with the full Millennium Project.

3. 3. While several questions remain, the design features of a system to collect judgments using the Delphi process that were suggested by the international panel (outlined elsewhere in this report) form a straight forward operational system. Among the remaining questions are the design and use of international information systems and data bases, integration with quantitative techniques such as system modeling, the requirements for special study teams, and institutionalization and financial support. The design of the operational system is described in detail in Section 3 of this report.

4. 4. Cost estimates have been made for establishing international panels and collecting and analyzing information they provide using the Delphi process. Several assumptions are required. If a maximum of four topics are addressed in a particular year, each of the four panels consists of 150–200 people, the staff is kept to a base of three people with an additional 1.5 per panel, and advisors are paid an honorarium of $1.500, then the cost of this element of the full scale Project is likely to be approximately $900,000 per year. While communications modes are important in terms of timing and information access, the costs of communications are the smallest of the Project's cost elements. Detail of our cost estimates appear in Section 7 of this report.

This is not the final feasibility study report, but only a report on part of Phase I. As such, it contains our initial findings about how the Project might be organized. We welcome comments from the reader. Please consider this as work in progress.     

A search cost model of obfuscation

This article develops models in which obfuscation is individually rational for oligopolistic firms. Firms sell a homogeneous good to rational consumers who incur search costs to learn prices. Search costs are endogenized by allowing obfuscation—firms have an unobservable action that increases the time needed to learn their price. One model involves search costs convex in shopping time. We show that slight convexity can dramatically alter the equilibrium price distribution. A second model examines an informational linkage between current and future search costs: consumers are uncertain about a component of search costs. Here, a signal‐jamming mechanism can lead to equilibrium obfuscation.     

ICT-based market information and adoption of agricultural seed technologies: Insights from Uganda

Access to ICT-based market information is crucial to the adoption of agricultural seed technologies for maize, beans and groundnut and to improve smallholder farmer yields and income. This ICT-based market information is provided by FM radio stations and by market information centers through media such as mobile phones and internet facilities, etc. Factors that positively affect the probability of access to ICT-based market information include access to microfinance loans, membership in a farmer association, government awareness campaigns, and wealth. Distance to the trading centers or district capital negatively affects this access. The likelihood of access to ICT-based market information declines with female-headed households. Access to market information has a positive and significant impact on the intensity of adopting improved seed for all crops. Adoption of improved seed has a positive and significant effect on farm yields and gross farm returns. This research shows that in order to generate meaningful improvements in food security and farm incomes, there must be commensurate efforts to promote ICT-based market information along with yield-augmenting agricultural seed technologies.