Market Theoretical Frameworks—Which One?*

The problem of choice between theoretical frameworks forms the focal point of this paper. Its intention is to discuss a possible choice between two distinct approaches to the market order—the ‘neoclassical’ and the ‘Austrian’. Firstly, the basis upon which the two theoretical frameworks are distinguished is explained. Secondly, an attempt is made to show that the two are indeed different and to derive the implications of their differences for policy, for the practice of economics as a social science and for human well-being. Finally, a defensible criterion is suggested along with the ensuing choice, and an explanation is offered as to the relevance of such a choice.     

Saving behaviours: first wave baby boomers

The combination of lower saving rates in the 1980s, high consumer debt, and the impact of the baby boomer generation moving into retirement in an uncertain economic environment creates increasing concern for the financial state of the American household. This study explored the saving behaviours of baby boomers. The family management-systems model was used as the framework for the study. Research questions included whether saving behaviours were related to income, education and presence of dependent children. Data are from the 1983 National Survey of Consumer Finances. The 1980s represent a decade critical to first wave baby boomers and their continued influence on American society. A study of their saving behaviours provides information necessary to help plan for their future needs. Frequency counts and cross-tabulations of demographic data provide a profile of saving behaviours and attitudes toward risk and liquidity. Marital status and presence of children were significantly related to reasons for savings. Income, marital status, education and presence of children indicated a significant effect on net worth and attitude towards risk. Income and presence of children affected attitude towards liquidity. Income level was the strongest predictor of net worth as a measure of saving behaviours.     

The Influence of Institutional Constraints on Outsourcing

Drawing on transaction cost economics and institutional theory we argue that the effects of institutional constraints on the transaction costs of outsourcing vary systematically with the type of service outsourced and the ownership structure of the outsourcing firm. Using data from hospitals, we demonstrate that these effects lead to a higher extent of outsourcing of nonclinical compared to clinical services, and larger outsourcing response of nonclinical services to cost pressures from managed care. Further, the effects of ownership structure and associated governance mechanisms on institutional constraints are reflected in the empirical results as cross‐sectional variations in the extent to which outsourcing is invoked as a response to cost pressures by hospitals of different ownership.