Illegal Landings: An Aggregate Catch Self-Reporting Mechanism

To solve the problem of illegal landings this article proposes a new tax mechanism based on the regulator's own aggregate catch estimates and ex ante self-reports of planned catch by fishermen. We show that the mechanism avoids illegal landings while ensuring (nearly) optimal exploitation and generating (nearly) correct entry and exit incentives. Finally we simulate the mechanism for the Danish cod fishery in Kattegat to obtain a rough indicator of the size of the tax. It turns out that the average tax payment as a percentage of profit is surprisingly low.     

Cooperative investments induced by contract law

I revisit the economic analysis of contract law for a setting of cooperative investments. While Che and Chung (1999) have shown that expectation damages perform rather poorly, I argue that this negative result follows from their implicit assumption of unilateral expectation damages. Yet the very nature of cooperative investments gives rise to the possibility that both parties may claim expectation damages. I show that such a regime of bilateral expectation damages provides the incentives for the first‐best solution even in a framework of binary choice where, for selfish investments, the traditional overreliance result would hold.     

The spatial structure of production with a Leontief technology

The structure of the optimal spatial pattern of production is studied when there are interdependencies among production units which can be described by a Leontief technology, and when there is a single marketplace of final demand, the CBD. Transportation cost is proportional to distance. It is shown that the various goods are produced in rings which can be ranked by distance from the CBD independently of the levels of final demand. Furthermore shipment of goods for meeting intermediate and final demand can only be in the direction of the CBD and no shipment of goods towards the periphery can occur. A finite algorithm is given for the construction of the optimal pattern and for determining a system of f.o.b. prices and land rents which sustain it as a competitive equilibrium.     

Can the Risks of the Kyoto Mechanisms be Reduced Through Portfolio Diversification? Evidence from the Swedish AIJ Program

Through Joint Implementationand the Clean Development Mechanism, reductionsof greenhouse gas emissions achieved abroad canbe credited to domestic firms. However, thetechnical, economic and political risksinvolved may prevent the private sector frominvesting in such projects. This paperdescribes three types of risks which emissionreduction projects are exposed to. Eleven pilotprojects carried out under the ActivitiesImplemented Jointly (AIJ) program and financedby Sweden are evaluated. Actual project costsare found to exceed projected costs in allcases. Annual emission reductions also deviatefrom their expected values and vary stronglyover time, supporting the hypothesis that suchprojects are risky business. The riskmanagement tool portfolio diversification isapplied to a sample of Swedish AIJ projects.The results indicate that diversification canreduce the risks of greenhouse gas mitigationprojects significantly. Thus, carbon funds area promising way of lowering the risks of theKyoto Mechanisms for private sector investors.     

A theory of reciprocity

People are reciprocal if they reward kind actions and punish unkind ones. In this paper we present a formal theory of reciprocity. It takes into account that people evaluate the kindness of an action not only by its consequences but also by its underlying intention. The theory is in line with the relevant stylized facts of a wide range of experimental games, such as the ultimatum game, the gift-exchange game, a reduced best-shot game, the dictator game, the prisoner's dilemma, and public goods games. Furthermore, it predicts that identical consequences trigger different reciprocal responses in different environments. Finally, the theory explains why outcomes tend to be fair in bilateral interactions whereas extremely unfair distributions may arise in competitive markets.     

More thinking on research methods for the resource‐based perspective

We re‐examine the benefits of using a broader set of research methods to address key questions associated with the resource‐based view (RBV) of the firm. In responding to Levitas and Chi, we consider how research inside organizations can complement and augment research relying on secondary data. Copyright © 2002 John Wiley & Sons, Ltd.