Real exchange rates,asset prices and terms of trade: A theoretical analysis

This paper develops a continuous-time two-country dynamic equilibrium model, in which the real exchange rates, asset prices, and terms of trade are jointly determined in the presence of nontradable goods. The model determines the relation between the financial markets and real goods markets in the world economy and their responses to various shocks under the home bias assumption. A positive domestic supply shock induces a positive return on the domestic asset markets and a deterioration of terms of trade that improves the foreign output and boosts the foreign asset markets. Demand shocks act in the opposite way. This model also analyses the impact of change in the relative price of nontradable to tradable goods on the terms of trade and asset markets. A higher productivity growth in tradable goods than in nontradable goods leads to a higher relative price of nontradable to tradable goods, which appreciates the real exchange rate, deteriorates the terms of trade, and depresses the domestic and foreign asset markets. A lower relative price of nontradable goods depreciates the real exchange rate, improves the terms of trade, and lifts both the domestic and foreign asset markets.     

Fashion retailing and the bottom line: The effects of generational cohorts,gender, fashion fanship,attitudes and impulse buying on fashion expenditure

This study examines the influence of demographic (e.g. gender and generational cohort) and psychographic (e.g. fashion fanship, attitudes and impulse buying) drivers on frequency and levels of expenditure on fashion purchases. Using regression analysis, the results suggest that for weekly and monthly expenditure, gender and fashion fanship were significant influences, while for yearly expenditure, gender and impulse buying were significant. Attitudes towards fashion had no significant influence on expenditure. Females purchase more often and were significantly different from males on yearly expenditure, fashion fanship, attitudes and impulse buying. Generation Y is higher on purchase frequency, fashion fanship, attitudes and impulse buying compared with other cohorts under investigation.     

Acquisition through innovation tournaments in high-tech industries: a comparative perspective

Acquisition of innovative firms is a widely observed phenomenon in high-tech industries. On the basis of distinct advantages of large and small firms, in this paper, we build a tournament model with possible acquisition activity of large firms to derive hypotheses on interdependencies between acquisition frequency and post-acquisition success rates. We find empirical support for our hypotheses that (1) acquisitions increase overall innovation output and (2) that the number of acquisitions is higher in industries with larger heterogeneity between established firms and young start-ups. However, our third hypothesis derived from the formal model that innovation success following from acquisitions varies across industries is only partially confirmed.     

How to rescue a failing pension regime: the British case

Recent analysis on New Regionalism has, for Björn Hettne, raised important ontological questions over ‘what we study when we study regionalism’. The paper contributes to this debate by focusing on the shared beliefs, norms and rituals that hold a region together. Working between the New Regionalism literature and thinking on international regimes, this paper – to paraphrase Friedrich Kratochwil and John Ruggie – outlines the ‘inescapable inter-subjective quality’ of a region. This focus on inter-subjectivity seeks to improve on existing approaches that consider shared social structures as already fixed, and/or as autonomous constructs operating over and above regional actors. In order to appreciate how inter-subjective structures and regional agents interact with each other, the paper explores the social construction of Latin America. Specifically, it examines the politics of regionness – understood here in relation to identity, space and agents – to demonstrate how various regional actors operate within, and reconstruct, shared meaning. In so doing, it interrogates the practices that govern and continually produce the region.     

Has New Zealand benefited from its investments in research & development?

We use panel data for nine industries to evaluate research and development (R&D) investments in New Zealand over the past forty years. We estimate the impact of R&D stocks in a particular industry on output per person in that industry and on output per person in the rest of the economy. We examine both public and private R&D investments. Privately provided R&D has a statistically significant positive impact on own-industry output per person, suggesting it increases productivity. However, publicly provided R&D has no impact on own-industry output per person. There is also evidence that private R&D in certain industries positively affects output per person in the rest of the economy, i.e. it generates positive spillovers. There is no evidence of positive spillovers from publicly provided R&D.     

New development: Spin-outs and social enterprise: the ‘right to request’ programme for health and social care services

The ‘right to request’ policy encouraged and supported National Health Service (NHS) community health staff in England to ‘spin out’ services into independent social enterprises. This article considers the processes and outputs of the initiative and reflects on the likelihood of positive outcomes for patients being achieved. It highlights lessons for future programmes seeking to transfer services out of public ownership.     

A novel approach to legacy donations with long-term benefits supported by numerical illustrations

Philanthropic donors face challenges in matching the causes to which they donate, the time horizon—and thus impact—of their donations, and the charitable vehicles they choose for making contributions. Wealthier donors may elect to create their own foundations and customize their charitable support. Less wealthy donors have limited choices: they may contribute to a nonprofit's current operations or to existing nonprofit endowments. We present a novel approach for making charitable donations, blending aspects of each of these strategies. Our approach has potential long-term financial benefits, allows donors to control their charitable donations in a convenient and easy-to-implement manner, can be established through an existing nonprofit organization, expands opportunities for more donors because it requires a smaller corpus contribution with lower management costs than creating a foundation, provides tax savings in the United States and other countries (e.g., the UK, Canada, and Australia) comparable to other planned giving vehicles, and may be implemented during one's lifetime using donor advised funds or as part of a legacy plan through the donor's estate documents, which is when the long-term benefits accrue.     

Optimal marginal and average income taxation under maximin

Using the Mirrlees optimal income tax model under maximin, we derive fairly mild conditions for a decreasing marginal tax rate throughout the skill distribution with no bunching, a strictly concave tax function in income and a single-peaked average tax schedule. Assuming additive preferences and an isoelastic disutility of labor function, these tax profiles are implied by aggregate skills that are non-decreasing with the skill level. If preferences are quasilinear in leisure or in consumption, these tax profiles are also obtained under a large set of skill distributions.