A translog estimation of the average cost function of the steel industry with financial accounting data

This paper proposes a measure to assess firm performance which is based in neoclassical production theory and yet can be empirically estimated with widely available financial accounting ratios. A translog cost function is estimated, and fitted per-unit average cost figures are generated based upon the firm's individual characteristics and industry norms. The deviation of a firm's actual average per-unit cost from the fitted value is proposed as a predictor of firm profitability. This measure is then tested on firms in the steel industry. It is shown that the accounting ratios generate a cost function which behaves in accordance with neoclassical microeconomic theory, and accounting profits are indeed found to be inversely related to the calculated efficiency measure.The authors are indebted to the participants of the Forty-Fourth International Atlantic Economic Conference, Philadelphia, PA, October 9–12, 1997, and an anonymous referee. Any shortcomings remain the responsibilities of the authors.     

Zu neuen Gerichtsentscheidungen über die Verstärkung des Verbraucherschutzes

Zusammenfassung Der Beitrag zeigt an zwei Beispielen aus der deutschen Gerichtspraxis, daß Verbraucherschutz nicht nur ein Anliegen an die Gesetzgebung beinhaltet. Vielmehr können Gerichte durch das ihnen vorliegende Fallmaterial verbraucherpolitisch wirken und damit die Rechtsstellung des Verbrauchers verbessern.

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Two court rulings strengthening the protection of consumers

The author describes two examples of consumer protection by German courts. It is suggested that the improvement of the consumer's position is not only a task for the legislator, but is also the result of effective law handling in courts.

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Theo Rasehorn ist Vorsitzender Richter am Oberlandesgericht Frankfurt, 6000 Frankfurt/Main.     

Turkish trade unionists and Turkey’s membership of the European Union

In all the discussions regarding Turkey’s accession to the EU, little attention has been paid to the views of workers. This paper provides a statistical analysis of the views of over 6000 Turkish trade union members on Turkey’s EU membership. Parameters are estimated using multilevel probit models where the nested structures of workers into trade unions and federations were taken into account since they shared some joint characteristics because of belonging to these organisations. It confirms the extensive disillusion with the EU found elsewhere in Turkish society but more interestingly it disconfirms an idea that those inside the EU may too easily assume to be the case: that it is those with what might be considered modernist characteristics among the Turkish population who are most likely to be in favour of EU entry. The idea seems to chime well with assumptions that the EU is a progressive, modern force. But whatever the validity of such a view, EU entry is not in fact found to be the favoured goal of the young and the best educated: it is older workers who are the most likely to support entry and those who are educated to the highest level the most likely to oppose it. Amongst the main three trade union federations there is also a greater propensity of members of trade unions affiliated to Hak Is (the Islamic federation) to support entry than those in Turk Is (centre right) or DISK (historically the most militant).     

A strategic network choice model for global container flows: specification, estimation and application

Container flows have been booming for decades. Expectations for the 21st century are less certain due to changes in climate and energy policy, increasing congestion and increased mobility of production factors. This paper presents a strategic model for the movement of containers on a global scale in order to analyse possible shifts in future container transport demand and the impacts of transport policies thereon. The model predicts yearly container flows over the world’s shipping routes and passing through 437 container ports around the world, based on trade information to and from all countries, taking into account more than 800 maritime container liner services. The model includes import, export and transhipment flows of containers at ports, as well as hinterland flows. The model was calibrated against observed data and is able to reproduce port throughput statistics rather accurately. The paper also introduces a scenario analysis to understand the impact of future, uncertain developments in container flows on port throughput. The scenarios include the effects of slow steaming, an increase in land based shipping costs and an increased use of large scale infrastructures such as the Trans-Siberian rail line and the opening of Arctic shipping routes. These scenarios provide an indication of the uncertainty on the expected port throughputs, with a particular focus on the port of Rotterdam in the Netherlands.     

Financial liberalization,openness and convergence

All industrialized nations relied on capital account controls for significant periods of their economic development and relaxations of capital account restrictions thought to be an integral aspect of economic development. Economists long advocated the removal of capital controls as a stabilizing factor of the development process to improve efficiency and return economies from distorted factor prices to production frontiers. Empirically, however, financial liberalizations have become associated with capital flow reversals, where initial capital inflows at the onset are subsequently offset by capital outflows resulting in higher levels of accumulated indebtedness. We investigate how capital flow reversals caused by financial liberalizations affect the speed of convergence of an economy. We show that financial liberalizations reduce short run convergence speeds, implying that open economies should experience significantly less output volatility but also longer transitions. The increased smoothness in response to initial shocks comes at a cost: as foreign borrowing rises to smooth domestic income fluctuations causing an increase in the domestic interest rate OECD data confirms our findings.     

Trade creation and diversion revisited: Accounting for model uncertainty and natural trading partner effects

The effect of preferential trade agreements (PTAs) on trade flows is subject to model uncertainty stemming from the diverse and even contradictory effects suggested by the theoretical PTA literature. The existing empirical literature has produced remarkably disparate results and the wide variety of empirical approaches reflects the uncertainty about the ‘correct’ set of explanatory variables that ought to be included in the analysis. To account for the model uncertainty that surrounds the validity of the competing PTA theories, we introduce Bayesian model averaging (BMA) to the PTA literature. Statistical theory shows that BMA successfully incorporates model uncertainty in linear regression analysis by minimizing the mean squared error, and by generating predictive distributions with optimal predictive performance. Once model uncertainty is addressed as part of the empirical strategy, we find strong evidence of trade creation, trade diversion, and open bloc effects. Our results are robust to a range of alternative empirical specifications proposed by the recent PTA literature. Copyright © 2010 John Wiley & Sons, Ltd.     

Discrete Spacings

Consider a string of n positions, i.e. a discrete string of length n . Units of length k are placed at random on this string in such a way that they do not overlap, and as often as possible, i.e. until all spacings between neighboring units have length less than k . When centered and scaled by n ^−1/2 the resulting numbers of spacings of length 1, 2,…,  k −1 have simultaneously a limiting normal distribution as n →∞. This is proved by the classical method of moments.     

Karriereoption Selbständigkeit — Chancen für Diplomkaufleute mit dem Schwerpunkt Marketing

Die Hochschulausbildung im Schwerpunktfach Marketing zielt eher in Richtung einer unselbst?ndigen T?tigkeit. Fachleute für Vermarktung und Verkauf fehlen aber auch in den Gründerteams vieler Start-up-Unternehmen. Hier bieten sich unternehmerische Karrierechancen für Hochschulabsolventen, wenn auch nicht unbedingt sofort nach dem Studium, so doch sp?ter, nachdem ausreichend Branchenerfahrung gesammelt wurde.     

The Term Structure of Interest Differentials in a Target Zone with Time-varying Devaluation Risk

We extend Svensson's (1991b) analysis of the term structure of interest rate differentials in a target zone. First, the model includes a time-varying devaluation risk, and second, we analyse the term structure of interest differentials vis-a-vis Germany in five countries: Belgium, Denmark, France, Italy and the Netherlands. In our sample, 1983–1993, we differentiate between stable and unstable periods. The findings for Denmark and the Netherlands, and for Belgium in the relatively stable period are broadly in line with Svensson's theory, whereas the other results are more in accordance with the model that allows for a time-varying devaluation risk.
(J.E.L. E43, F31).