No reliance on guidance: counter‐signaling in management forecasts

This study presents and provides an explanation for a novel stylized fact: both high‐performing and troubled companies withhold issuing earnings guidance. We assume that the manager's ability affects the level of earnings and the accuracy of guidance, but issuing a forecast is costless for all manager types. Managers are thus able to signal their ability through accuracy in their forecasts. While high ability managers would seem to benefit the most from issuing guidance, in equilibrium we find that both high and low ability managers withhold issuing guidance, while intermediate types forecast. Hence, high ability managers counter‐signal in equilibrium, which does not result in a subsequent “punishment” by the market.     

Does Bank Affiliation Mitigate Liquidity Constraints? Evidence from Germany's Universal Banks in the Pre-World War I Period

This paper compares two similar samples of mining and steel corporations in pre-World War I Germany: one sample consists of corporations that were affiliated to one or more of the German “Universal Banks”, and the second sample consists of companies that had to rely on other sources of finance. Statistical analysis conducted in the framework of a linear fixed effects model indicates that the non-affiliated companies were liquidity constrained. The paper also sets out the corporate control structure as laid down in the trade law reform of 1884 and traces the origins of the current German dual board system, as well as the origins of several other aspects of the institutions that tied the German banking system to industrial concerns.     

An evaluation of the life cycle effects of minimum pensions on retirement behavior

In this paper we explore the effects of the minimum pension program on welfare and retirement in Spain. This is done with a stylized life cycle model which provides a convenient analytical characterization of optimal behavior. We use data from the Spanish Social Security to estimate the behavioral parameters of the model and then simulate the changes induced by the minimum pension in aggregate retirement patterns. The impact is substantial: there is a threefold increase in retirement at 60 (the age of first entitlement) with respect to the economy without minimum pensions, and total early retirement (before or at 60) is almost 50% larger. Copyright © 2007 John Wiley & Sons, Ltd.     

深圳人口发展的基本问题

进入21世纪以来，中国的现代化仍然保持高歌猛进的发展势头。持续高速的工业化已经引发世纪之交中国不断加速的城市化浪潮，以至于中国的城市化被人称为是21世纪影响世界的两大事件之一。现在中国的城市化率以每年1．4个百分点递增，已达到42．99％，已有1．5亿农民工在中国的城市中谋生，仅2005年由乡村流入城市的人口数就接近1800万人，而且这个数目正不断刷新。人口的大规模转移，使中国城市人口总量高达56212万人，是世界上城市人口数量最多的国家。有人认为，中国城市人口增长的第四个阶段已经开始。     

The Link Between Wages and Productivity in Spain

This paper examines the effect of productivity on wages for Spanish industrial sectors by developing a model that captures effects from both sector‐specific and aggregate variables. The results show that a dual behaviour can be inferred, at the sector level, in the wage‐setting mechanism. It is also found that the linkage between wages and productivity varies over time. Some explanations for the increase in wage dispersion are provided, focusing on the increasing decentralisation in wage bargaining after 1986. Finally, we cast some light on the theoretical structure underlying the labour market.     

Social norms,cooperation and inequality

This paper analyzes the outcomes that can be supported by social norms in a society of infinitely lived and patient agents that are randomly matched in pairs every period to play a given game. I find that any mutually beneficial outcome can be supported by a self-enforcing social norm under both perfect information and a simple local information system. These Folk Theorem results explain not only how social norms can provide incentives that support cooperation in a community, providing support to the concepts of social capital and corporate culture, but also how they can support inequality and discrimination.I am grateful to David Levine for invaluable guidance and ideas. I also thank Anna Aizer, Hongbin Cai, Walter Cont, Ernesto Dal Bó, Jean-Laurent Rosenthal, Federico Weinschelbaun, William Zame, anonymous referees and seminar participants at Universidad de Buenos Aires, UCLA, Universidad T. Di Tella, Harvard Business School and Stockholm School of Economics for very useful comments and discussions     

Ben Ross Schneider. Business Politics and the State in Twentieth-Century Latin America. New York: Cambridge University Press, 2004. xix + 312 pp. ISBN 0-521-83651-4, $70.00 (cloth); 0-521-54500-5, $26.99 (paper).

This volume is a valuable addition to the extensive and disparatebibliography on business associations, state-business relations,collective action, corporatism, and civil society. One of itsmajor achievements is that it will help to redirect researchon these topics. The book encompasses a wide field of scholarlywork hitherto undertaken in a variety of disciplines: politicalscience, economics, sociology of organizations, and economicand business history. In terms of business history, Schneider’sbook is an important contribution to the study of     

On strategic networks

In parallel with a theoretical acceptance of the importance of the laws of competition to formulate strategy, the realization is growing that cooperative behavior among firms is at the root of many success stories in today's management. This situation calls for an effort to develop a theoretical framework to study both aspects of firm behavior (cooperative and competitive) as compatible, complementary aspects of a unique reality. Indeed, the cooperative relationships of a firm can be the source of its competitive strength. This paper develops the concept of strategic network, as a tool to understand those cooperative relationships and their role in the strategy of the firm. There are three main tasks of the paper: first, to show that strategic networks are but a ‘mode of organization’; second, to study the economic conditions of existence of a network; finally, to analyze the conditions of existence of a network from the point of view of its internal consistency. In a final section some of the most obvious strategic implications of the framework are outlined.     

Parametric continuity of stationary distributions

For Markovian economic models, long-run equilibria are typically identified with the stationary (invariant) distributions generated by the model. In this paper we provide new sufficient conditions for continuity in the map from parameters to these equilibria. Several existing results are shown to be special cases of our theorem. This paper has benefitted from the helpful comments of Kevin Reffett, Rabee Tourky, an anonymous referee and participants at the 13th European Workshop on General Equilibrium Theory, Venice 2004. The second author is grateful for financial support from Australian Research Council Grant DP0557625.