A coopetitive model for the green economy

The paper proposes a coopetitive model for the Green Economy. It addresses the issue of the climate change policy and the creation and diffusion of low-carbon technologies. In the present paper the complex construct of coopetition is applied at macroeconomic level. The model, based on Game Theory, enables us to offer a set of possible solutions in a coopetitive context, allowing to find a Pareto solution in a win–win scenario. The model, which is based on the assumption that each country produces a level of output which is determined in a non-cooperative game of Cournot-type and that considers at the same time a coopetitive strategy regarding the low technologies, will suggest a solution that shows the convenience for each country to participate actively to a program of low carbon technologies within a coopetitive framework to address a policy of climate change, thus aiming at balancing the environmental imbalances.     

FIRM DYNAMICS IN AN URBAN ECONOMY *

We develop a new dynamic general equilibrium model to explain firm entry, exit, and relocation decisions in an urban economy with multiple locations and agglomeration externalities. We characterize the stationary distribution of firms that arises in equilibrium. We estimate the parameters of the model using a method of moments estimator. Using unique panel data collected by Dun and Bradstreet, we find that agglomeration externalities increase the productivity of firms by up to 8%. Economic policies that subsidize firm relocations to the central business district increase agglomeration externalities in that area. They also increase economic welfare in the economy.     

The technological capabilities of nations: The state of the art of synthetic indicators

Composite synthetic indicators of the technological capabilities of nations have been used more frequently over the last years becoming a sort of Olympic medal table of the innovation race. The European Commission, specialised United Nations Agencies, the World Bank, the World Economic Forum, and individual scholars have developed several of these measurement tools at macroeconomic level. All these indicators are based on a variety of statistical sources in order to capture the multidimensional nature of technological change. This paper reviews these various exercises and: i) it brings into light the explicit and implicit assumptions on the nature of technological change; ii) it discusses their pros and cons; and iii) it explores the consistency among the results achieved. Most of the final rankings at the country level are fairly consistent, but significant discrepancies for some nations emerge. The value of synthetic indicators of technological capabilities for public policy, company strategies and economic studies is finally discussed.     

A problem-adjusted genetic algorithm for flexibility design

Many present markets for goods and services have highly volatile demand due to short life cycles and strong competition in saturated environments. Determination of capacity levels is difficult because capacities often need to be set long before demand realizes. In order to avoid capacity-demand mismatches, operations managers employ mix-flexible resources which allow them to shift excess demands to unused capacities. The Flexibility Design Problem (FDP) models the decision on the optimal configuration of a flexible (manufacturing) network. FDP is a difficult stochastic optimization problem, for which traditional exact approaches are not able to solve but the smallest instances in reasonable time. We develop a Flexibility Design Genetic Algorithm (FGA) that exploits qualitative insights into the structure of good solutions, such as the well-established chaining principle, to enhance its performance. FGA is compared to a commercial solver, a simple GA, and a Simulated Annealing local search on instances of up to 15 demand types and resources. Experimental evidence shows that the proposed approach outperforms the competing methods with respect to both computing time and solution quality.     

Big push or big failure? On the effectiveness of industrialization policies for economic development

The role of the government in industrialization is heavily debated. Some claim that extensive government involvement is key to initiate a sustainable development process, others see the government as an obstacle to it, pointing to the importance of government failure. We formulate a model, which explains why even a highly inefficient industrial policy can successfully promote big-push development. Moreover, we show that extensive government intervention is more likely to be successful when the initial level of development is low.     

Hungary

Statistical Annex

Hungary     

Margin requirements and equilibrium asset prices

This paper studies the effect of margin requirements on asset prices and trading volume in a general equilibrium asset pricing model where Epstein-Zin investors differ in their degree of risk aversion. Under the assumptions of unit intertemporal elasticity of substitution and zero net supply of riskless assets, I show analytically that binding margin requirements do not affect stock prices. This result stands in contrast to previous partial equilibrium analysis where fixed margin requirements increase the volatility of stock prices. In this framework, binding margin requirements induce a fall in the riskless rate, increase its volatility, and increase stock trading volume.     

Economic interdependence and structural change: an investigation on business cycle transmission

Insomma, non si può osservare una onda senza tenere conto degli aspetti complessi che concorrono a formarla e di quelli altrettanto complessi cui essa dà luogo (I. Calvino, Palomar).