Management Buyouts and Industrial Relations

Acquisition by managers of the control of firms in difficulty is taming the unions. Norman Tebbit should devise means of inducing the large public sector unions to buy the nationalised industries.     

Comparaison empirique des méthodes d'inférence de probabilités subjectives*

Résumé. Les méthodes d'inférence de probabilités subjectives que sont l'amplitude directe et la bissection ont été comparées par l'auteur en ce qui a trait à l'exactitude, telle que déterminée par l'environnement (fréquence relative), des probabilités résultant de l'application de ces méthodes et à l'acceptabilité des méthodes d'inférence. Chaque participant à l'expérience a utilisé les deux méthodes et attribué à chacune d'elles une cote d'acceptabilité. L'auteur a mis à la disposition des sujets un logiciel d'inférence interactive, comprenant l'affichage graphique sous forme d'histogramme des probabilités selon les deux méthodes d'inférence, afin de les aider et d'assurer une comparaison plus raffinée des méthodes. Des étudiants de deuxième cycle diplômés en gestion, bien renseignés tant sur le contexte de la tâche que sur les probabilités subjectives, se sont prêtés à l'expérience. L'inférence directe a donné des probabilités subjectives beaucoup plus exactes que la bissection et s'est révélée beaucoup plus acceptable aux yeux des participants.     

A Model of Money and Credit, with Application to the Credit Card Debt Puzzle

Many individuals simultaneously have significant credit card debt and money in the bank. The credit card debt puzzle is as follows: given high interest rates on credit cards and low rates on bank accounts, why not pay down debt? While some economists go to elaborate lengths to explain this, we argue it is a special case of the rate of return dominance puzzle from monetary economics. We extend standard monetary theory to incorporate consumer debt, which is interesting in its own right since developing models where money and credit coexist is a long-standing challenge. Our model is quite tractable—for example, it readily yields nice existence and characterization results—and helps put into context recent discussions of consumer debt.     

Bargaining over Interconnection: The Clear-Telecom Dispute

We explore the problem of network interconnection in local telecommunications. We develop a model with a competitive business sector and a regulated residential sector. The model is used to analyze the celebrated New Zealand antitrust case between Clear and Telecom. We discuss implications of the model for the economics of antitrust, including issues of competition versus efficiency and the use of appropriate economic models. We also examine the implications of some proposed rules for interconnection. In particular, we examine reciprocity, 'bill and keep', and the rule that the courts ultimately endorsed, the Baumol-Willig rule.     

Affordable Rental Housing: Lost,Stolen and Strayed*

This paper contributes to an exploration of the potential causes (as distinct from existence) of social and spatial polarisation. It focuses on the changing provision of low-rent housing in a spatial context, and hence on the role that the private rental market plays in the residential choices available to lower income households. The paper applies multinomial logit estimation to panel data to determine the factors that affect the probability that an existing rental dwelling remains at the same real rent value over the decade from 1991 to 2001, filters down or up or exits from the private rental market. It tests the hypothesis that the outcome is affected by neighbourhood characteristics.     

The Development of Specialist Industry Knowledge in Government Auditing

Government auditors play an important role in overseeing public agencies, yet there is little understanding of the types of knowledge that specialist industry auditors require in this environment and how this knowledge is acquired. This study develops a portfolio of knowledge items that various sources have suggested are important for industry-specialist auditors. It was found that the items perceived to be of greatest importance to government auditors were contained under the broad knowledge categories of "accounting", "auditing", and "entity-specific factors". Most of the specialised knowledge is acquired on the job, although some of this knowledge may be better acquired through formal training.