On Ramsey's conjecture: efficient allocations in the neoclassical growth model with private information

In his seminal paper of 1928, Ramsey conjectured that if agents discounted the future differently, in the long run all agents except the most patient would live at the subsistence level. The validity of this conjecture was investigated in different environments. In particular, it has been confirmed in the neoclassical growth model with dynamically complete markets. This paper studies this conjecture in a version of this model that includes private information and heterogeneous agents. A version of Bayesian implementation is introduced and a recursive formulation of the original allocation problem is established. Efficient allocations are renegotiation-proof and the expected utility of any agent cannot go to zero with positive probability if the economy does not collapse. If the economy collapses all agents will get zero consumption forever. Thus, including any degree of private information in the neoclassical growth model will deny Ramsey's conjecture, if efficient allocations are considered.     

The Impact of Second Homes on Local Taxes*

A methodology to estimate the influence of second homes on municipal taxes is developed in this paper. Assuming that a larger floating population implies an increase in public expenditure, our aim is to develop a model of the relationship between the local taxes paid and the number of second dwellings in a village. As an applied example, the results for two of the most touristy regions of the Mediterranean – the Costa del Sol and the Costa Blanca, in Spain – are shown in this paper. As we will see, there are only three different levels of local taxes, regardless of the number of second homes. The main factors behind high local tax burdens are seaside location and the presence of foreign owners.     

Heterogeneous beliefs and learning in forward looking economic models*

We study a class of forward looking economic models with heterogeneous agents in a bounded rationality setting. The agents employ the same recursive learning rule to update beliefs but are characterized by different memory parameters. The peculiarity of the learning mechanism is that the learning rate is not vanishing in the limit. Differently from what is obtained in the case of a vanishing learning step, i.e., the stability conditions in the heterogeneous agents case are those of the representative agent model, we show that heterogeneity matters for the expectational stability of a stationary perfect foresight equilibrium and that the stability parameter restrictions with heterogeneous agents are stronger than in the case of homogeneous agents.     

From correlation to dispersion: geometry of the price-value deviation

This paper deals with the problem of measuring the deviation between different vectors of prices. We analyse both conditional and unconditional measures of the price-to-price deviation by using the geometry of least squares as an auxiliary tool. We discuss two fundamental types of measure: the correlation between two different sets of prices, and the dispersion in a set of ratios between pairs of prices. We show that none of these measures can be used to estimate the actual degree of disequilibrium in a real system of prices, due to a problem related to the selection of measurement units.      

Restructuring as a signal: a simple formalization

Several studies have stressed that, contrary to initial expectations, state-owned firms at the beginning of the transition undertook painful measures to adjust to the new economic environment. This paper investigates this behaviour in a simple game theoretic framework. It is argued that the massive amount of lay-offs created by state-owned firms during the initial phase of the transition can be interpreted as a signal directed to the banking sector in order to obtain more favourable financing conditions for the subsequent process of restructuring. The conclusions are strongly supported by Polish firm-level empirical evidence.
JEL classification: P31, C72.     

Market reaction to uniform capital adequacy guidelines in the banking industry

In this paper the authors assess the stock market reaction to information on uniform capital requirements that was disseminated on four different dates: September 29, 1987; December 7, 1987; December 10, 1987; and July 11, 1988. The share prices of U.S. money center banks were adversely affected by the December 7, 1987, announcement regarding proposals to make regulatory standards more uniform. The share prices of U.S. superregional banks were not affected by this announcement. The difference in degree of response is attributed to disparate capital positions between the two groups of banks. In order to meet the new guidelines, U.S. money center banks may need to implement policies (such as issuing new stock) that are viewed unfavorably by the market.     

Biotechnology Development in Spain: A Change of Paradigm?

This article presents a quantitative and qualitative analysis of the Spanish biotechnology sector, including its scientific, business, policy and social aspects. The study differentiates two sub-sectors, considered to be the most representative: Biopharma and Agro-food. The results show that biotechnology development in Spain has entered a new phase. Traditionally, research and development in Spain followed an unstructured path built around regional spaces and driven by factors and influences external to Spain. However, the emergence of a fast-growing sector of spin-off companies from the public research system, specifically in the Biopharma sector, points to a change of model of development of the industry, on the national as well as the regional level. The data also show the key role which public policy plays in creating a suitable framework for innovation and point to the need of analyzing the influence of social and cultural factors on the development of the biotechnology sector.     

Human and organizational capital: typologies among Spanish firms

This paper uses survey data on 965 Spanish manufacturing firms to examine the implementation of innovative management practices and the relationship of this with the organization of work and human resource management. The paper takes into account transformations in technology, quality management and the organization of work. Using cluster analysis, we identify the different paths that firms are following in order to improve their performance, finding that simultaneous transformations in several dimensions lead to greater success than partial transformation, or none at all.     

Why do firms train? Empirical evidence on the relationship between training and technological and organizational change

We explore the relationship between training and innovation using key insights from the resource‐based approach, organizational learning and labour studies. By using data from 304 large enterprises in Italy, the study highlights a twofold role of training in favouring technological and organizational changes. First, training plays a role in allowing the acquisition and the assimilation of new knowledge. Consequently, firms in which the provision of training is part of a bundle of high‐performance management practices are more likely to undertake technological and organizational changes and to develop new competencies internally. Second, training supports firms in the assimilation of technological and organizational changes. Consequently, firms that undertake these changes exhibit a superior participation rate for employees and greater time intensity of their training programmes. Firms' inclination to develop new competencies internally does not affect, however, the intensity of training, thereby suggesting that organizational learning processes do not start by a broad involvement of employees in formalized training programmes.     

Carbon Sequestration with Reforestations and Biodiversity-scenic Values

This paper presents an optimal control model to analyze reforestations with two different species, including commercial values, carbon sequestration and biodiversity or scenic values. We discuss the implications of partial or total internalization of environmental values, showing that internalizing only carbon sequestration may have negative impacts on biodiversity-scenic values. To evaluate the practical relevance, we compare reforestations in the South-west of Spain with cork-oaks (a slow-growing native species) and with eucalyptus (a fast-growing alien species). We do the analysis with two different carbon crediting methods: the Carbon Flow Method and the Ton Year Accounting Method. With the first method, the forest surface increases more, but using mainly eucalyptus. With the second, additional reforestations are done mainly using cork-oaks. We value the impact on visitors of these reforestations using stated preferences methods showing that, when these values are internalized, cork-oaks are favored.