Trade Liberalization and Heterogeneous Technology Investments

We propose a trade model where heterogeneous firms decide on a productivity‐enhancing technology investment. The model analyzes the impact of multilateral trade liberalization on firm‐ and industry‐level productivity. Freer trade increases the incentives to invest in technology by raising export profits. It also dampens these incentives, however, as profits stemming from domestic sales are reduced. Only exporters benefit from the former positive effect. The shape of the distribution of efficiency draws, the level of trade costs and the technology intensity of the industry are key elements removing the ambiguities regarding the net impact of trade liberalization.     

Global Force for Branding: A Study of Attitudes,Intentions, the Military,and the Wars Overseas

Through the years, the United States Armed Forces has advertized to the citizens of America in times of peace and war. The present study explores the attitudes and intentions regarding the military by two groups of study participants during the United States’ active engagement in Afghanistan and Iraq. One group of participants viewed a military ad and one group was asked to recall a military ad. Mediation analysis revealed partially mediated relationships among attitude toward the ad, attitude toward the military (where the military has “brand” characteristics), and the discussion of one's own intention to enlist in the armed forces as well as one's intention to recommend enlisting to friends and family. Post hoc analysis indicated that sex has a strong direct effect on enlistment discussion intentions. Implications of these findings are discussed.     

An interdisciplinary approach to regional land use analysis using GIS, with applications to the Atlantic Zone of Costa Rica

Policy makers and other stakeholders concerned with regional rural development increasingly face the need for instruments that can improve transparency in the policy debate and that enhance understanding of opportunities for and limitations to development. To this end, a methodology called SOLUS (Sustainable Options for Land Use) was developed by an interdisciplinary team of scientists over a 10-year period in the Atlantic Zone of Costa Rica. The main tools of SOLUS include a linear programming (LP) model, two expert systems that define technical coefficients for a large number of production activities, and a geographic information system (GIS). A five-step procedure was developed for GIS to spatially reference biophysical and economic parameters, to create input for the expert systems and the LP model, to store and spatially reference model output data, and to create maps of both model input and output data. SOLUS can be used to evaluate the potential effects of alternative policies and incentive structures on the performance of the agricultural sector. A number of practical applications demonstrate SOLUS's capability to quantify trade-offs between economic objectives (income, employment) and environmental sustainability (soil nutrient balances, pesticide use, greenhouse gas emissions). GIS-created maps visualize the spatial aspects of such trade-offs and indicate hotspots where local goals may conflict with regional goals.     

Sustainable development and the local economy

This article sets out the divergence so far between the developing “environmental economics” and local authority “green strategies”. We propose a model of environmentally sustainable economic development. Our argument outlines “environmental efficiency” and more stringent “sustainability” objectives. It reviews current local authority activities and practices. All are within the “environmental efficiency” framework. It concludes by identifying opportunities created by recent government commitment to environmental improvement targets and argues that local authorities are well placed to take up the challenge of developing sustainable development in local economies. It suggests that this process will involve intervention in the market in a way not dissimilar to that adopted in the 1980s by local authorities concerned with developing socially progressive economic strategies and that this process might be termed “social environmentalism”.     

Deriving target selection rules from endogenously selected samples

The selection of the most profitable customers in a customer database for targeted activities is often done based on observed behaviour in the past. Consequently, databases arising from the responses to, for example, direct mailings in the past are not random samples. When not all heterogeneity across customers is observed, target selection will be based on unobserved heterogeneity and hence it is endogenous. We develop a method to adjust the likelihood function of latent class models to correct for this endogenous sampling process. We apply this technique to the selection of mail targets for a Dutch charity. Based on a joint model for the response rate and the amount donated, we create a target selection rule that maximizes expected revenues. Copyright © 2006 John Wiley & Sons, Ltd.     

Private Regulation to Appropriate Value from Design Innovations: Implications for Anti-trust Policy

Co-operative ventures among rivals are looked upon in general with suspicion by antitrust authorities. In this paper, we position ourselves in the school of thought that evaluates collusive behavior among rivals with the Schumpeterian concept of dynamic competition in mind rather than the concept of Neoclassical perfect competition. We argue that whenever firms have difficulty in appropriating sufficient returns from their innovations, certain forms of apparently collusive behavior--or, more precisely, 'private regulation'--may actually stimulate investment in innovation and thereby Schumpeterian competition. A study of firms' strategies to appropriate value from design innovations in the Dutch and Italian furniture industry illustrates our arguments.     

The Contribution of Migration to Economic Development in Holland 1570–1800

Migration always played an important role in Dutch society. However, little quantitative evidence on its effect on economic development is known for the period before the twentieth century even though some stories exist about their effect on the Golden Age. Applying a VAR analysis on a new dataset on migration and growth for the period 1570–1800, we find that migration had a positive effect on factor accumulation during the whole period, and a positive direct effect on the per capita income during the Golden Age. This seems to confirm those studies that claim that the Dutch economy during its Golden Age at least partially benefitted from immigration.