External Economies in Procyclical Productivity: How Important Are They?

Using the method of Caballero and Lyons (1990,1992), I examined detailed Swedish manufacturing firm-level dataon output and factor inputs from 1979 through 1994. Panel regressionsshow that an increase in aggregate output and inputs appearsto raise individual firms' production beyond private marginalreturns, a result consistent with positive external effects fromaggregate activity. However, while considering potential specificationdifficulties, this analysis shows that a model in which high-frequencyexogenous shifts in technology drive the business cycle statisticallyoutperforms the Caballero-Lyons model. This finding suggeststhat economywide fluctuations in technology are more importantfor movements in firms' productivity than are external economies.     

Why Are Women Delaying Motherhood in Germany?

Abstract

German fertility trends show that the average age at which women have their first child has increased in recent decades. Moreover, researchers have argued that delayed maternity is an important factor in reduced fertility. Using data from the German Socio-Economic Panel (SOEP), this paper contributes to the debate about maternity timing and reduced fertility in Germany by analyzing some of the factors determining the delay of motherhood. The results suggest that German women who have accumulated more years of education and longer work experience at the time of marriage delay motherhood more. On the other hand, women with higher labor income and a higher contribution to household income delay motherhood less. The results confirm that women consolidate their careers before motherhood in order to reduce career costs. Therefore, if fertility rates are to be increased in Germany further policies that aim to combine women's careers and motherhood need to be developed.     

Disparities in Australian Regional Incomes: Are They Widening or Narrowing?

In this study we examine Australian census data on regional incomes for the period 1976–91. Following a discussion of theories and empirical evidence regarding regional income adjustment, the regional dispersion of per capita income is analysed for the six Australian states and at the sub-state level (statistical divisions, SDs). The coefficient of variation is used as the measure of dispersion, and Gini coefficients are also calculated to analyse income equality within regions. For Australia, the cross-state dispersion of per capita incomes increased over the period, whereas there was neither convergence nor divergence of incomes among Australia's 57 SDs. In addition, the intrastate dispersion of per capita incomes across SDs remained largely unaltered over the period. Gini coefficients indicated that across income strata, the distribution of incomes both within states and within SDs has become more equal.     

ICP 2005 Construction Prices: Are They Underestimated in Developing Countries?

Construction prices are lower in developing countries in ICP 2005, which has raised these countries' capital/output ratio in Penn World Tables 7 and 8 and affected growth analyses. We estimate the Colombia/U.S. price ratio for office and apartment buildings in 2005 as a test of the validity of the ICP 2005 methodology for estimating these prices. Our estimate of the Colombia/U.S. price ratio is almost twice the ICP 2005 estimate. We confirm the validity of our results by estimating the cost of constructing office and apartment buildings using 2005 prices for construction materials, equipment, and labor in both countries.     

On the Market for Principles of Economics Textbooks: Innovation and Product Differentiation—A Response

E. A. Ross was fired from Stanford University in 1900 because he had angered Jane L. Stanford, the surviving cofounder of the university, for violating her alleged prohibition of faculty participation in partisan political activity. The author argues that this prohibition may never have been written and that the injustice in the firing of Ross may have been compounded by deception.     

Are Unrealistic Assumptions/Simplifications Acceptable? Some Methodological Issues in Economics

Are unrealistic assumptions acceptable? If results are not changed in a misleading way, they are acceptable. The same assumption may be acceptable in one context and not in another. Assuming identical pairs of individuals in the parity and limit theorems in general equilibrium theory is acceptable as results are not changed substantially. The alleged equivalence of the first‐price and second‐price auctions is based on misleading assumptions; Coase's case against taxing pollution is based on a misleading all‐or‐nothing comparison. The contrasting results (neutrality versus non‐neutrality of money) of perfect versus imperfect competition in macroeconomics with important real‐world policy relevance are also used to illustrate the point.     

‘Economics with Training Wheels’: Using Blogs in Teaching and Assessing Introductory Economics

Blogs provide a dynamic interactive medium for online discussion, consistent with communal constructivist pedagogy. The author of this article describes and evaluates a blog assignment used in the teaching and assessment of a small (40–60 students) introductory economics course. Using qualitative and quantitative data collected across four semesters, students’ participation in the blog assignment is found to be associated with student ability, gender, and student perceptions of the blog. Importantly, students with past economics experience do not appear to crowd out novice economics students. Student performance is positively associated with the quality of their blog participation after controlling for student ability, suggesting that a focus on quality of student engagement could further improve learning outcomes. Students generally report overall positive experiences with the blog assignment.     

Are biotechnology and its clusters in crisis?

This paper asks whether biotechnology, in general, and the industry clusters of innovative biotechnology enterprises that have uniformly characterised its economic form, are now in a terminal crisis. Or are the difficulties that are clearly evident and described below surmountable and showing signs of being surmounted? The question of a crisis in biotechnology is important because so much faith has been placed in the technology over the past generation during which it has made great technical strides forward in medicine and other user communities (agro-food, energy, environment, security) and contributed significantly to healthcare and welfare gains while high hopes have long and justifiably been associated with its vibrant industry clusters. The paper postulates a crisis based on two key features of biotechnology. The first of these is an economic crisis in which enormous sums are required to research, develop and innovate new products, especially medical drugs. The second is epistemological and confronts the (reductionist) central dogma of biotechnology with the evolutionary implications of emergent systems biology.     

Autism in Economics? A Second Opinion

A popular claim among critics is that economic science is suffering from autism, a severe developmental disorder characterised by impairments in social relations and communication, combined with rigid and repetitive behaviour. So far, this allegation has not been substantiated. This essay explores the claim of autism in economics based on modern schemes of diagnostics. A key finding is that the structure of the critique against mainstream economics bears a striking resemblance to the structure of the diagnostic criteria for autism. Based on an examination of three groups of key symptoms, I conclude that the required set of criteria for the autism diagnosis are not met. However, there are parallels which may serve as constructive reminders for the future development and application of economic theories and models.     

Are Women Less Capable in Managing Crops? Insights from Cotton Production in Northern China

Women’s performance in agriculture matters, as women are becoming increasingly involved in agricultural production worldwide. Many studies have demonstrated that women-led farms perform less well as a result of less access to production factors, but no studies focus on how women perform without this constraint. This study fills that gap by analyzing the case of cotton cropping, which is known for its high labor requirements, high production inputs, and need for technical knowledge. Using primary data collected in northern China over the 2006–9 period, it uses the concept of “Daily Crop Management” (DCM) and identifies DCM farms managed by women whose husbands were engaged in off-farm activities on a long-term basis. The study finds that one-third of all farms were female-DCM farms, that these were smaller than those of their male counterparts but had equal access to production factors and achieved equal if not better technical and economic performances.     

Autism in Economics? A Second Opinion

A popular claim among critics is that economic science is suffering from autism, a severe developmental disorder characterised by impairments in social relations and communication, combined with rigid and repetitive behaviour. So far, this allegation has not been substantiated. This essay explores the claim of autism in economics based on modern schemes of diagnostics. A key finding is that the structure of the critique against mainstream economics bears a striking resemblance to the structure of the diagnostic criteria for autism. Based on an examination of three groups of key symptoms, I conclude that the required set of criteria for the autism diagnosis are not met. However, there are parallels which may serve as constructive reminders for the future development and application of economic theories and models.     

Neoliberalism in the Laboratory? Experimental Economics on Markets and their Limits

Experimental economics is now part of mainstream economics and is fast becoming one of its most influential methods. Drawing on the distinction between market and behavioural experimentation, this article assesses the compatibility of the most influential experimental research with the neoliberal understanding of the political and moral preconditions for markets to develop. A politically relevant asymmetry at the core of this research programme will be signalled: while issues of political economy are eschewed by market experimenters (for example, whose interests are favoured and whose groups have power in economic processes), topics of moral economy are recognised and dealt with by behavioural experimenters (for example, the interactions between economic institutions and individuals' motivations and moral make-up). It is argued that experimental research has thereby contributed to a depoliticised and moralised view of markets, one that tends to present markets as a civilising institution once their technical and moral failures are recognised and adequately dealt with.     

Institutions and ‘Science’: The Contest about Pluralism in Economics in France

ABSTRACT

For a long time, France was a country in which various approaches to economics coexisted. This pluralism began to dwindle in the mid-1990s. Since then, France has witnessed the increasing and now overwhelming domination of mainstream economics. This article, drawing on a study of the evolution of the recruitment of professors of economics in France, documents the situation and links the observed trends to the changing institutions governing the discipline (a centralized system evolving under the influence of international norms and instruments). It is demonstrated that far from being fair and neutral devices, the rules and instruments governing economics—notably the ranking lists of economic journals—incorporate specific worldviews strongly biasing the assessment of research toward the mainstream. This article documents the tentative use of ‘voice and exit’ by the French Association of Political Economy to reform the economics discipline. Furthermore, it discusses the arguments proclaimed by Jean Tirole to prevent the French Ministry of Higher Education from creating a new university section called ‘Economy and Society’ to reinstate pluralism: they fall back on a monistic view of science that is questioned notably by developments—both factual and conceptual—in science studies and epistemology.     

Inside the Organizational Institutions of Institutional Economics: Why Are There Two Institutionalist Associations?

The institutionalist-inspired Association for Evolutionary Economics (AFEE), officially founded in 1965, was the first heterodox association to break with the American Economic Association (AEA). In 1979, another institutionalist association, the Association for Institutional Thought (AFIT), was founded. Using mainly archival evidence, this paper provides historical reasons for the presence of two institutionalist associations.     

Conquering or mapping? Textbooks and the dissemination of human capital theory in applied economics

Textbooks are an important subject for the study of science in general and economics in particular. In this paper, we analyse at the process of the acceptance of human capital theory through its inclusion in economics textbooks by looking at two specialized fields to which this theory became highly influential: labour economics and the economics of education. The analysis will compare the patterns of the dissemination of these new theoretical developments in a more consolidated field and in an emergent field of economics research with a particular focus in the early stages of that dissemination process.     

Safe Harbours in Merger Guidelines: What Should They Be?

Safe harbours in merger guidelines define post‐merger market concentration or concentration change thresholds below which proposed mergers are unlikely to be anti‐competitive; anti‐competitiveness is usually measured as a ‘substantial lessening of competition’. Yet competition agencies have different safe harbours. We used merger models to run many simulations involving a wide range of market structures and merger‐induced aggregations. The post‐merger unilateral price increases in these scenarios were used to gauge what the safe harbours should be to keep price increases below a specified threshold. The safe harbour thresholds commonly used were found typically to be too restrictive, in that they failed to screen out mergers that were almost certainly competitively benign.