Inequality and growth: the perverse relation between the productive and the non-productive assets of the economy

The explosion generated by the global financial crisis in 2008 and its transmission to the real economies have been interpreted as calling for new kinds of regulation of the banking and the financial systems that would have allowed re-establishing a virtuous relation between the real and the financial sectors of the economy. In this paper we maintain a different view, that the financial crisis and the ensuing real crisis have roots in the strong increase in income inequality that has been taking place in the Western world in the last thirty years or so. This has created an all around aggregate demand deficiency crisis that has strongly reduced prospects and opportunities for investments in productive capacities and shifted resources toward other uses, thus feeding a perverse relation between the productive and the non-productive assets of the economy. In this context the way out of the crisis is re-establishing the right distributive conditions, which cannot be obtained by a policy aimed at relieving the weight of private or public debts but calls for a redistribution through taxes on the incomes of non-productive sectors, a fine tuning that should prevent excessive taxations transforming positive into negative effects.     

Stagflationary Effects of Stabilization Programs in Reforming Socialist Countries: Enterprise-Side and Household-Side Factors

Dismantling subsidies could give rise to serious macroeconomicdifficulties in the short run. This article explores a viewbased on the enterprise sector as a central source and mainchannel of the stagflation phenomenon, using as an example thestagflation that followed the 1990 stabilization program inPoland. The stagflation phenomenon is linked to features ofthe financial market that are somewhat peculiar to reformingsocialist economies: the weak credit links between householdsand enterprises, and the existence of large interenterprisedebt. The policy implications of the enterprise-side view includemore explicit consideration of initial conditions in the creditmarket, implementation of privatization schemes, and the developmentof a domestic banking system.     

Weathering the Storm: The Impact of the East Asian Crisis on Farm Households in Indonesia and Thailand

This article assesses the impact of the East Asian financialcrisis on farm households in two of the region's most affectedcountries. Indonesia and Thailand, using detailed household-levelsurvey data collected before and after the crisis began. Althoughthe nature of the shocks in the two countries were similar,the impact on farmers' income (particularly on distribution)was quite different. In Thailand, poor farmers bore the bruntof the crisis, in part because of their greater reliance onthe urban economy, than did poor farmers in Indonesia. Urban-rurallinks are much weaker in Indonesia. Farmers in both countries,particularly those specializing in export crops, benefited fromthe currency devaluation. Although there is some evidence thatthe productivity of the smallest landholders declined over theperiod in question, it is difficult to attribute this directlyto the financial crisis. At least in Thailand, a rural creditcrunch does not seem to have materialized.      

Stay in or get out the Janus? The maintenance of multiplex relationships between buyers and sellers

Buyers and sellers interact in different ways. They conduct economic transactions but often also engage in social exchanges; they compete to appropriate the value generated throughout the pipeline but often also collaborate in mutual value creation. Increasingly, they show patterns of repeated interaction rather than engaging in single transactions.Most past research investigated interaction modalities within buyer-seller relationships through an ‘or-or’ lens, and considered one modality as prevailing within the relationship at a given moment.In this study, we will develop an ‘and-and’ logic, opening the mainstream view of relationship maintenance to social theories on the structure of economic action and the strategy view of coopetition. We will further examine the implications of dualities and complementarities within buyer-seller relationships in respect of their maintenance over time.     

Fiscal Retrenchment in Southern Europe: Changing patterns of public management in Greece,Italy, Portugal and Spain

The vulnerability of the four south European countries (Greece, Italy, Portugal and Spain) to the global financial turmoil makes the analysis of their responses to the fiscal crisis particularly interesting for the assessment of the implications of fiscal austerity for public management. Drawing on the historical institutionalist approach, our analysis reveals a picture of variation in the impact of crisis on patterns of public management across south European countries. However, it also shows uniformity in the strategies of retrenchment as in all the four countries under examination governments failed to connect cutback management to ambitious administrative modernization programmes.     

The role of volume in order book dynamics: a multivariate Hawkes process analysis

We show that multivariate Hawkes processes coupled with the nonparametric estimation procedure first proposed in Bacry and Muzy [IEEE Trans. Inform. Theory, 2016, 62, 2184–2202] can be successfully used to study complex interactions between the time of arrival of orders and their size observed in a limit order book market. We apply this methodology to high-frequency order book data of futures traded at EUREX. Specifically, we demonstrate how this approach is amenable not only to analyse interplay between different order types (market orders, limit orders, cancellations) but also to include other relevant quantities, such as the order size, into the analysis, showing also that simple models assuming the independence between volume and time are not suitable to describe the data.     

Exploring different views of exchange rate regime choice

The empirical distinction between de facto and de jure exchange rate regimes raises a number of interesting questions. Which factors may induce a de facto peg? Why do countries enforce a peg but do not announce it? Why do countries “break their promises”? We show that a stable socio-political environment and an efficient political decision-making process are a necessary prerequisite for choosing a peg and sticking to it, challenging the view that sees the exchange rate as a commitment device. Policymakers seem rather concerned with regime sustainability in the face of adverse economic and socio-political fundamentals.     

Bank shareholding and lending: Complementarity or substitution? Some evidence from a panel of large Italian firms

The paper studies the motivations behind banks’ shareholding of non-financial firms using a panel of large Italian companies in the period 1994–2000. Empirical evidence shows that banks are shareholders of companies that are less profitable, have experienced slower growth, are more indebted, are endowed with collateral and have hard time to repay their debt out of current income. Banks are more likely to hold shares in companies they lend to. Overall the evidence suggests that there is complementarity between bank equity holding and lending. A plausible explanation is the shareholder–debtholder conflict, the evidence is weakly compatible with governance and information hypotheses.     

K-means clustering of item characteristic curves and item information curves via functional principal component analysis

Quality & Quantity - The assessment of students’ performances and learning skills plays a key role in the educational context. Common tools for analyzing test data are item response...