Population,agriculture, and the environment in Africa

An overview is provided of the World Bank study about the interaction between rapid population growth, poor agricultural performance, and environmental degradation. The links between these 3 phenomena are identified as traditional methods of crop and livestock production, land tenure systems, women's responsibilities, and methods of forest use. When land was abundant and capital limited, pastoralism, shifting cultivation, and setting aside fallow land was possible. Mobility and allowances for natural regeneration of vegetation could not continue with rapid population growth. Permanent settlements developed but cultivation methods remained the same; the result was deterioration of soil fertility, low yields, and erosion of soil as occurred in Rwanda, Burkina Faso, and parts of Nigeria. Technological innovation has been slow and poor roads have interfered with a market oriented economy. Inappropriate pricing, exchange rates, and fiscal policies also prevent productivity gains. A heavy demand is placed on women's time. Demand for children is high and is stimulated by environmental degradation, food insecurity, land tenure systems, and cultural traditions. Child labor is needed. The demand for contraception is 30-50% in North Africa, 36-55% in Asia, and 40-60% in South America. Land ownership problems have arisen under community ownership and between herders and settlers. Solutions have ranged from land nationalization and arbitrary designation of individual ownership. Open access situations have developed and lent themselves to exploitation. Fuelwood needs have exacerbated the destruction of forests. Commercial logging accounted for 10-20% of the forest loss. New approaches are needed to link cross-sectionally population, the environment, an agriculture. Emphasis should be on resource conservation, family planning, and environmentally benign intensive farming. Agricultural production needs to grow at 4%/year, fertility lowered by 50% over 30 years, and deforestation slowed. Women's time constraints should b alleviated and productivity improved. Open access and state ownership should be stopped.     

Internal monitoring, regulation, and compensation of top executives in banks

This paper examines the relation between incentive pay, monitoring, and regulatory requirements in banks. Using a one-period model with asymmetrical information between the bank owner and the top management team, as well as within the team itself, we show that (1) incentive pay increases the mutual-monitoring activity among top executives; (2) senior executives, especially the CEO, collect more incentive pay than their subordinates; and (3) bank regulations, such as capital adequacy (CAD) requirements, reduce the absolute amount of incentive pay granted to executives.     

Evidence on the effects of inflation on price dispersion under indexation

Distortionary effects of inflation on relative prices are the main argument for inflation stabilization in macro models with sticky prices. Under indexation of non-optimized prices, those models imply a nonlinear and dynamic impact of inflation on the cross-sectional price dispersion (relative price or inflation variability, RPV). Using US sectoral price data, we estimate such a relationship between inflation and RPV, also taking into account the endogeneity of inflation by using two- and three-stage least-squares and GMM techniques, which turns out to be relevant. We find an effect of (expected) inflation on RPV, and our results indicate that average (??trend??) inflation is important for the RPV?Cinflation relationship. Lagged inflation matters for indexation in the CPI data, but is not important empirically in the PPI data.     

Audits,Reputation, and Repeated Interaction in a Capital Budgeting Setting

This experimental study investigates the use of audits as a control instrument in capital budgeting processes and factors that contribute to audit efficiency (or inefficiency) in a repeated relationship. We disentangle reputational aspects of superiors and subordinates from an increased social content in repeated relationships. In settings where subjects face new counterparts every round, we find that reputational aspects strongly affect the superiors' and subordinates' behavior. This leads to a decrease in slack and an increase in the superior payoff. However, in a repeated relationship with an increased level of social content, these benefits are no longer present. In fact, the subordinates' ability to retaliate against their superior for prior punishments in the repeated setting by reporting more slack in later rounds has negative effects on the use of audits and decreases audit efficiency. These findings imply that, in repeated relationships, social factors play an important role and might impair the disciplining effects of audits.     

Economic indices of absolute and relative riskiness

Following Aumann and Serrano (J Polit Econ 116:810–836, 2008) who characterize by axioms an index of riskiness defined on absolute returns, we characterize a new index of riskiness defined on relative returns. Both indices are characterized by a similar principle of duality between risk and risk aversion, but while the index of absolute riskiness refers to absolute risk aversion, the index of relative riskiness refers to relative risk aversion. The similarities and differences between the two indices are studied.     

Impact of office layout on communication in a science-driven business

Driving innovation and creativity has relied heavily on new information technologies in the last decade. Human capital has certainly had its importance, but how to coordinate human capital in order to push productivity in research and development without compromising individual initiative is still not well understood. In this paper, we provide results showing that geometry of workspace has indeed an impact on communication patterns and may thus be used as a means to drive both innovation and efficient research. In order to be creative, new knowledge has to be created. Communication facilitates knowledge creation. We try to close the bridge between areas of creation of tacit knowledge and transfer of knowledge highlighted by authors like Nonaka, Takeuchi, Konno, von Krogh and von Hippel with the area of communication patterns pioneered by Allen, Hatch, and Stryker, by considering face‐to‐face (FTF) communication as a first step for socialization, socialization as a means for knowledge creation. In this article, we compare two different office environments within the same site, same activity, same hierarchical level and same company: a traditional cell office area and a new multi‐space office, used by people who used to work in cell offices. We observed FTF communication patterns during 120 h in two areas and measured over 2,000 communication events. We found that people communicate three times more often in a multi‐space area than in a cell‐space area. We also found that the mean duration of communication events decreased from 9 to 3 min when transferring collaborators from a cell‐space to a multi‐space. Finally time spent without communication increased from 5% to 29% when going from cell‐offices to multi‐space areas – leaving more time for people to work and think on their own. And we found that most communication events during work time in the multi‐space took place at the work place and seldom or never in soft sitting areas installed for the purpose of communication.