MUNICIPAL CONTRACTING OUT: GOVERNANCE CHOICES,MISALIGNMENT AND PERFORMANCE IN SWEDISH LOCAL GOVERNMENT

In this paper we apply a Transaction Cost Theory framework to analyse the use and effects of contracting out in Swedish local government. During the last decade Swedish local authorities, like in many other countries, have, to a larger extent, started to contract external subcontractors to fulfil their responsibilities towards its citizens. It is not only in the traditional subcontracting sectors such as housing, infrastructure, and technical services that this trend is evident, but also in policy areas like education, social care, and elderly care. In fact, very little is known about the overall effects of, and the mechanisms underlying, governance choices. The overall results corroborate transaction cost reasoning. Supplier competition and specificity have anticipated effects on municipal de‐integration. Too little, but not too much, use of contracting out, in relation to theoretical predictions, worsens performance. The latter aspect is not fully in accordance with TCE‐propositions.     

Herstellung von Wettbewerb durch Übertragung der Alterungsrückstellung in der Privaten Krankenversicherung

The system of individual prospective aging reserve enables the insured persons irrespectively of their individual risk to change their Private Health Insurance. Besides the presentation of an implementation concept it is shown that there is no inducement to miscalculate the extent of the individual prospective aging reserve on purpose.     

Survey on Competing in Network Industries: Firm Strategies, Market Outcomes, and Policy Implications

We review the recent literature on market structure, firm strategies and public policy in network industries. In particular, we focus on the latest applied work, including case studies and empirical work as well as refinements of the established theoretical results. We group each set of results along two dimensions: Static (within-generation) and dynamic (across-generations).     

Neuregelung des bundesstaatlichen Finanzausgleichs: Umverteilungs- und Verbleibseffekte

The paper explores effects of the revision of the system of fiscal equalisation in Germany as recently agreed upon by the federal and state governments. More specifically, using a simulation analysis, it explores the distribution of gains and losses associated with changes in horizontal and vertical fiscal flows. In addition, the paper determines the degree of fiscal redistribution. While the degree of fiscal redistribution is found to be reduced for major revenue sources, local tax revenues are subject to much higher redistribution than under the status quo. Increases in local tax revenues might even result in total revenue losses for some states.     

Illusory Price Increases after the Euro Changeover in Germany: An Expectancy-Consistent Bias

The aim of the present report is to review research demonstrating the role played by expectations for observed illusory price increases after the euro introduction in Germany. In laboratory experiments when participants are asked to estimate price changes in a restaurant following the euro introduction, the price estimates are found to be biased in the direction of the expectation of rising prices. The research also examines the extent to which a similar judgment bias is evident in other areas and how interventions counteract the bias. A further focus of the research is on the underlying process. In this respect the results show that the bias is based on a selective outcome correction process not previously described. Theoretical implications and practical implications for consumer policy issues are highlighted.

Trust and controllability in venture capital fundraising

This study discusses a model of success in venture capital (VC) fundraising. We develop this model based on agency and trust theory. The model is tested against quantitative data collected from 151 limited partners (LP) with headquarters predominantly in North America and Europe. Beyond the well-known criterion of the VC firm's track record, results suggest that trust and perceived controllability shape the investment decisions of those LPs. Moreover, antecedents of these main factors are evaluated. In sum, this study shows how fundraising VC firms can systematically manage the fundraising process.     

The impact of venture capital on the persistence of innovation activities of start-ups

In this study we investigate the impact of early stage venture capital on innovation activities of start-ups. This is done based on a cohort of start-ups that is representative of all firms founded in Switzerland in 1996/97, as recorded by a census of the Swiss Federal Statistical Office for this period. We analyze not only the impact of early stage venture capital on innovation performance 3 years after firm foundation, but also 6 and 9 years after firm start, respectively, for those firms that survived and reported continuously innovation activities (persistence of innovation). The results support neither the hypothesis of a positive impact on initial innovation activities nor the hypothesis of a positive time-persistent effect on innovation performance of start-ups.