PLANT-LEVEL ANALYSIS USING THE ARD: ANOTHER LOOK AT GIBRAT'S LAW

This study uses the Annual Respondents Database to test whether Gibrat's law of proportionate effect holds for the UK manufacturing industry during the period 1973–1998. For a sample of manufacturing industries, four different panel unit root tests were carried out to test the relationship between growth and size for three measures of size: gross output, employment and gross value added. The tests were applied to unbalanced plant‐level panel data. The results show that there is strong evidence to reject Gibrat's law that firm growth is a random process in favour of the alternative proposition of mean reversion.     

UNDERSTANDING THE RELATIONSHIP BETWEEN INFRASTRUCTURE PUBLIC‒PRIVATE PARTNERSHIPS AND INNOVATION

While the contemporary academic discourse regards innovation as an inherent feature of infrastructure public?private partnerships (PPPs), the conceptual link between infrastructure PPPs and innovation is narrowly understood. While most existing studies conceptualize the innovation processes and effects within the context of PPP projects, we argue that the relevance of innovation in infrastructure PPPs goes beyond specific projects. In this conceptual article, we examine why and how infrastructure PPP innovations can shape the evolution of the involved private and public sector organizations – and therefore the respective sectors – more broadly. We show that innovation in the context of PPPs has much broader implications and potential outcomes than as emphasized in the literature so far.     

DO PROFIT MAXIMISERS TAKE COLD SHOWERS? ANOTHER LOOK AT PROTECTION AND TECHNICAL EFFICIENCY

In this paper we consider whether a 'cold shower' is possible if the firm we are analysing is a conventional neoclassical profit-maximising firm facing competitively determined prices. In the context of this analysis, the term 'cold shower' refers to a situation where the removal of a protective subsidy induces investment in a cost-reducing technology. First we show that if the investment lowers marginal cost everywhere, then our firm will never respond to the removal of the subsidy by making the investment. We then use this result to carefully construct examples where the investment does not lower marginal cost everywhere. These examples are devised to illustrate a cold shower scenario where, with no protection in place, the firm makes the investment, that would have been rejected, if the protection had have been in place.     

THE RELATIONSHIP BETWEEN ILLEGAL DRUG PRICES AT THE RETAIL USER AND SELLER LEVELS

This article uses 1985–2000 DEA data on marijuana and cocaine prices in various metropolitan areas to empirically test two contrasting theories of the relationship between illegal drug prices at the retail seller and user levels. Regression results overwhelmingly reject a multiplicative model in which the ratio of prices at the two levels is constant, but strongly support an additive model in which the difference between these prices is constant. This finding reduces the attractiveness of policies aimed at raising wholesale prices, because retail price responses, and thus potential drug demand deterrence, would be substantially smaller than commonly assumed. (JEL D40 , I18 , K42 )     

我国企业经营管理者创新精神对创新成果影响的实证研究

在我国越过刘易斯拐点之后,通过技术创新提升生产效率及产品性能质量,是结构转型的主要方向。在影响企业创新投入及创新绩效的诸多要素中,企业经营管理者的创新精神是极为重要的。对207家高科技企业和制造企业经营管理者的创新精神和企业创新成果的考察发现,我国企业经营管理者的创新精神与企业创新成果有很强的内在关系。企业经营管理者的变革求新倾向越强,企业创新成果越好;而企业经营管理者的冒险性倾向对创新成果数量和质量的提升无密切相关性。本文旨在为推动我国企业的创新活动和建立培养富有创新精神的社会环境提供参考依据。     

A SOBER LOOK AT THE COSTS OF INTOXICATION

Advocates of increased government regulation of intoxicating substances often cite the "social cost" of such goods. A close examination of studies that calculate the social cost of intoxication reveals a variety of recurring methodological errors. These studies do not clearly distinguish external costs from private costs. They do not systematically compare the costs associated with the regulation of intoxicant use with the costs of intoxicant consumption, nor do they even estimate the social benefits associated with intoxication or compare them with the social costs. Unless these problems are addressed, social cost calculation will be dismissed as a tool for political lobbying.     

政府R&D补贴政策与企业创新决策间双向动态耦合与非线性关系*

本文以新常态下创新驱动的引擎产业——高技术产业为研究对象,通过面板向量自回归方法将政府的直接补贴、税收优惠与企业的资本、人员投入及创新收益同时纳入系统框架,研究政府R&D补贴政策与企业创新行为决策之间的双向动态耦合关系,然后基于动态面板门限回归研究企业创新收益与两类R&D补贴政策间可能存在的非线性关系,并以理论模型与经验研究相结合的方式分析直接补贴与税收优惠影响高技术企业创新的机理及作用效果。研究证实企业增加创新投入是提高创新收益的根本原因;R&D补贴对企业资本投入的“挤入作用”并不明显,但税收优惠能有效激励高技术企业在人员方面的投入;政府“低补贴、低优惠”的双低策略更有利于提高企业的创新收益。     

THE RELATIONSHIP BETWEEN FINANCIAL INCENTIVES FOR COMPANY PRESIDENTS AND FIRM PERFORMANCE IN JAPAN*

Kaplan (1994 ) concludes that the relationship between top pay and stock performance in Japan is similar to that in the USA. Using a new and comprehensive data set that includes presidents’ stock and their stock option holdings, this study estimates the sensitivity of Japanese presidents’ wealth to shareholder wealth in the period 1977–2000. Contrary to the commonly held belief that Japanese corporate governance is becoming more like that in the USA, the results show that pay–performance sensitivity actually decreased substantially after 1990. In 2000, Japanese presidents received $US22,100 when stock returns increased from ?2.1% to 14.8%.     

A CLOSE LOOK AT DISSAVING IN THE LONGITUDINAL RETIREMENT HISTORY SURVEY

Hurd (1987) provided evidence from the Longitudinal Retirement History Survey that the retired elderly dissave. This paper attempts to refine and extend that analysis in several ways. I determine how sensitive his results are to his method for estimating missing data. I calculate median dissaving rates, a more robust measure of dissaving. I provide confidence intervals for those rates. Finally, 1 compute estimates based on a method that weights all households equally. The results are mixed. Hurd's dissaving finding is confirmed in many specifications, but questions are raised about dissaving among couples and the method of elderly dissaving.     

THE J‐CURVE AT THE INDUSTRY LEVEL: EVIDENCE FROM TRADE BETWEEN THE US AND AUSTRALIA*

Previous studies that tested the J‐curve phenomenon for Australia used trade data either between Australia and the rest of the world or between Australia and its trading partners on a bilateral basis. They were unable to find support for the J‐curve in the short run nor any significant relation between the trade balance and the exchange rate in the long run. In this paper we disaggregate the data between Australia and its second largest trading partner, the US, and consider the trade between 108 industries. Using annual data over the 1962–2003 period and bounds testing approach to cointegration and error‐correction modelling, we are able to discover short‐run effects of currency depreciation on the trade balance in 64 industries. The long‐run and positive effects were only evidenced in 35 cases, supporting the J‐curve.     

THE INADEQUACY OF UNIT VALUE INDEXES AS PROXIES FOR CANADIAN INDUSTRIAL SELLING PRICE INDEXES*

This paper considers the adequacy of unit value indexes as proxies for industrial selling price indexes in Canada, in light of the considerations raised in the Searle report for the United States (summarized elsewhere in this issue). Some 3,237 regressions are run using the industrial selling price index for a commodity group as the dependent variable and the corresponding unit value index as the independent variable. The unit value indexes perform poorly as predictors of the I.S.P.I.; the overall tendency is for the unit value index to overestimate changes in the I.S.P.I.; and to explain on average only about 30 percent of the total variance of the I.S.P.I.     

AN EMPIRICAL ANALYSIS OF THE RELATIONSHIP BETWEEN UK TREASURY BILLS AND THE TERM STRUCTURE OF CERTIFICATES OF DEPOSIT*

Using principal components analysis, this paper derives a direct measure of movements in the level and slope of the certificate of deposit yield curve. Appealing to the efficient markets view of the term structure of interest rates, evidence is reported which suggests that changes in Treasury Bill yields have a considerable influence over changes in the level of CD yields but only have a small, transitory effect on the slope of the term structure of CDs.     

THE RELATIONSHIP BETWEEN ECONOMIC FREEDOM AND ECONOMIC DYNAMISM

We analyze the consequences of economic freedom on economic dynamism across U.S. states and over time. Using data from the Economic Freedom of North America index, we show that states with greater economic freedom have higher rates of gross and net job creation and establishment entry. The results are robust to the inclusion of many different control variables and alternative specifications, suggesting a connection between freedom and dynamism. This evidence supports theories in which government policies may impede business dynamism. (JEL 043, P16, R5)