Allow yourself to be surprised!

Excellence in management and leadership is determined by how successfully the unexpected is handled. Health care is never in a state of equilibrium. Health care is the most complicated business that anyone can imagine and has many dynamic forces that are always at work to create chaos and uncertainty. It is impossible to eliminate the element of surprise in our work. Instead, we should be judged on our ability to welcome surprise and astonishment and to help ourselves and our organizations grow and learn from the unexpected.     

Wage subsidies, work incentives, and the reform of the Austrian welfare system

We analyze the employment and income effects of a needs-based minimum benefit system (“Bedarfsorientierte Mindestsicherung”) which has recently been introduced in Austria. The aim of this reform was to reduce poverty as well as to increase work incentives for recipients of social assistance. On the basis of a behavioral microsimulation model we show that this new system slightly increases employment but reduces incomes for the poorest households remaining unemployed. As an alternative, we analyze a budgetary neutral reform proposal which reduces financial incentives for marginal employment and provides a wage subsidy rewarding working longer hours. This alternative reform would yield larger positive employment effects, but more households would suffer from income losses. Overall, income inequality and poverty are affected little, however, both under the new social welfare system and the alternative reform proposal.     

Indian export incentives

This paper analyses Indian export incentives within the framework of piecemeal ‘second-best’ welfare economics, taking the extant import control system as a binding constraint. It provides a condensed account of recent Indian export incentives together with some quantitative estimates (based on firm level data for some engineering good exporters) of their likely effects on feasible second-best welfare levels.     

When financial work incentives pay for themselves: evidence from a randomized social experiment for welfare recipients

This paper summarizes early findings from a social experiment that provided financial incentives for new welfare recipients to leave welfare and work full time. The financial incentive was essentially a negative income tax with a requirement that people work at least 30 h/week. Early results show that the financial incentive increased full-time employment, earnings, and income, and reduced poverty. Furthermore, at the end of the period discussed in this paper, the program was paying for itself through increased tax revenues.     

价格听证制度急待完善

《价格法》实施两年多来,各地对《价格法》中规定的实行价格听证制度的领会与执行过程中确实存在着各自理解上的差异。本文拟结合两年来漳州物委实际操作情况,对以上问题作若干探索。 一、要兼顾政府、企业和消费者三者的利益 社会主义市场经济是法制经济,客观上要求进入市场的主体,在平等的条件下参与竞争。而这一原则所指的就是在程序上必须公正,而程序的公正首要考虑的必须是三者利益得到兼顾的情况下,给予各方     

基金专家经验谈

<正> 前不久,普华永道的全球基金业主席Jeffreys从伦敦来到北京,刚拜会完中国证监会,本刊记者即对其进行了采访。普华永道为全球基金业提供咨询服务并占据较大市场份额,是否传统的会计、审计业务仍占收入的主要比例? 我们为全球基金业提供咨询服务业务,目前已在全球占据了50％的市场份额。我们为这些基金提供的服务包括正常的审计、会计、税务咨询服务。还包括风险管理及个人所得税的处理等方面。从普华永道收入来说,约有50％的收入来自审计、会计的服务,另外50％的收入来自咨询和顾问服务。在咨询方面一个很重要的内容是对公司发展战略方面提供服务。     

浅谈财务人员如何管家理财当好参谋

企业会计是企业经济管理的一个重要组成部分,它是以货币为主要计量单位对企业经济过程中进行反映和监督,并运用会计信息参与预测、决策活动,发挥管理作用。财务人员必须熟悉企业的全部经济状况,掌握经济规律,按照经济规律办事,这样,财会工作才能认真贯彻财政经济方针政策,主动为经济活动提供优质的服务。     

Strategic incentives in dynamic duopoly

We compare steady states of open loop and locally stable Markov perfect equilibria (MPE) in a general symmetric differential game duopoly model with costs of adjustment. Strategic incentives at the MPE depend on whether an increase in the state variable of a firm hurts or helps the rival and on whether at the MPE there is intertemporal strategic substitutability or complementarity. A full characterization is provided in the linear-quadratic case. Then with price competition and costly production adjustment, static strategic complementarity turns into intertemporal strategic substitutability and the MPE steady-state outcome is more competitive than static Bertrand competition.     

Pricing incentives under price-cap regulation

In many price-cap regulation plans, such as those of AT&T and British Telecom, a weighted average of the prices for multiple services (baskets) must not exceed a specified level. This analysis demonstrates that the weighting scheme most commonly employed is subject to intertemporal manipulation. This investigation provides specific demand conditions under which weight manipulation can arise, shows the manipulation to reduce social welfare, and proposes a simple alternative weighting scheme that is less prone to manipulation. The alternative weighting scheme can help in designing more effective price-cap plans, especially if new plans have longer terms than current ones.     

Rebates as incentives to exclusivity

Abstract.  We show how rebates (or fidelity discounts) that take the form of lump‐sum payments made to retailers can be used by an incumbent manufacturer to achieve exclusivity and to deter the entry of a more efficient rival. The results, which hold whatever the degree of differentiation between retailers and whatever the cost advantage of the entrant, are found, despite minimizing asymmetries that may favour the incumbent. As such, there is no need to introduce buyers' disorganization, discriminatory offers, economies of scale, non‐coincident markets, or liquidated damages to find that exclusivity can lead to anti‐competitive effects. JEL classification: L12, L42     

Cartel formation and managerial incentives

We study the formation of cartels within two different contexts. First, we consider internal–external stability based models which, due to firms’ free-riding incentives, lead to the inexistence of stable cartels. Second, we introduce the dynamic aspect of coalition formation. That is, when considering a cartel we consider also any cartel that can be reached through a succession of moves. Despite firms’ free-riding incentive, the dynamic process predicts that the collusion of the whole industry can occur with some regularity. We show that free-riding incentives decrease and incentives to merge increase when firms’ owner delegate production decisions to managers.      

Political incentives for rent creation

Rent-seeking is often depicted as a contest in which rent-seekers compete for a prize—the rent. In the process of rent-seeking, much or perhaps all of the rent is dissipated through the costs the contestants incur to compete. Rent dissipation is inconsistent with the incentives of both the rent-seekers and those who create the rents. Policymakers have an incentive to create rents only if they gain from the process, and their gain comes from sharing any surplus that goes to those who obtain the rents. A surplus can be created through a barrier to entry into rent-seeking. When institutions that generate barriers to entry into rent-seeking break down, rent-seeking competitions can occur in which all rents are dissipated, but this should be a special case rather than the general rule in rent-seeking.     

Telephone pools and economic incentives

We identify the incentive structure for a firm that participates in a pooling arrangement. These pooling arrangements have been common in the telecommunications industry, both in the United States and in Canada. We identify alternative mechanisms, including cost caps, yardstick competition, transfer prices, and fixed revenue allocators. A pooling firm has inferior incentives for cost reducing innovation, truthful reporting of costs, and avoidance of abuse relative to alternative mechanisms. These incentive problems are similar to those that arise under rate-of-return regulation. Notably, transfer/access pricing, does not rectify the poor incentives embodied in pools. However, pooling does facilitate demand enhancement, due to its ability to internalize potential network effects.The authors wish to gratefully acknowledge the financial support of Southwestern Bell Telephone in the preparation of this paper. The views expressed are those of the authors and not those of Southwestern Bell. We are grateful for comments received at the 14th Annual Conference of the Center for Research in Regulated Industries, Graduate School of Management, Rutgers University, and valuable suggestions by Michael A. Crew and the referee.     

Unemployment accounts and employment incentives

We explore the far-reaching implications of replacing current unemployment benefit (UB) systems by an unemployment accounts (UAs) system. Under the UAs system, employed people are required to make ongoing contributions to their UAs and the balances in these accounts are available to them during periods of unemployment. The government is able to undertake balanced-budget interpersonal redistributions among the UAs. At the end of their working lives, people could transfer the remaining balances on their UAs into their pensions.We present an analytical framework to analyse the incentive effects of UAs and calibrate our model for the high high-unemployment countries of Europe. Our results suggest that this policy reform would significantly change people's employment incentives and could achieve reductions in unemployment without reducing the level of support to the unemployed.     

Managerial incentives in the financial sector

Despite significant academic and policy interest the nature of managerial incentives in the non- industrial sector has escaped close scrutiny. Contrary to some earlier suggestions, this note finds traditional incentives to maximize profits or market value prevalent in the financial sector.