Environmental amenities and optimal agricultural land use: The case of Israel

This paper evaluates the effectiveness of changing land allocation among crops as a mechanism for increasing net-social benefits, where production profits and amenity values are augmented. A positive mathematical programming model is calibrated and applied to 43 regions in the northern part of Israel, using a crop-discriminating amenity-value function. Changes in land allocation increase net-social benefits by 2.4% nationwide and by up to 15% on the regional level, where in some regions the net-social-benefits-increase/profit-loss ratio exceeds 20. Therefore, the results indicate that a policy encouraging amenity-enhancement of agricultural land use is warranted, provided that it is implemented on a regional scale, rather than as a comprehensive nationwide-enforced program.     

Integrated transitions toward sustainability: The case of water and energy policies in Israel

Transition Management literature has examined how long-term transitions could be directed toward greater sustainability. However, it has mostly taken a sectoral approach which neglects the potential relationships between environmental changes and policy dynamics in different sectors. This paper examines parallel and interrelated dynamics in the Israeli water and energy sectors by combining insights from the literature on policy dynamics, transition management, co-evolution, and policy integration. The developed approach examines how sectoral transitions may be coupled and technological regimes may co-evolve. Israel has battled water, energy and other scarcities from its formation. Consecutive dry years, the loss of stream flows, salinization of the coastal aquifer, and severe pollution are problems facing water managers, while air pollution, imported fossil fuels and carbon emissions are salient energy issues. Water and energy sectors are both in transition because earlier policies have resulted in socially-induced scarcity, degradation of environmental assets and loss of adaptive capacity to respond to future challenges. Current approaches to water and energy scarcities have evolved around technological configurations which emphasize traditional supply side solutions such as seawater desalination and additional power plants. They may be difficult to change without explicit integrative transitions management.     

Government and industry performance: a comparative study

A number of UK industries are heavily dependent on the government as a major purchaser. The Ministry of Defence and the National Health Service are essentially monopsonists for the industries supplying them. As a monopsonist, government can influence the size, structure, conduct and performance of the industries. This paper examines wheather industries relying heavily on government purchases will differ in their structure, conduct and performance-characteristics and whether dependence on goverment can have favourable or adverse effects on industry performance. The hypothesis is tested by comparing the performance of industries dependent on government purchasing – defence, pharmaceuticals and medical equipment – with a control group of other non-dependent industries.     

Using geographic information systems to revisit enduring rivalries: The case of Israel

This article derives from a project which has developed a major reconceptualization and revision of how borders may be seen and measured through the use of GIS. This reconceptualization permits an investigation of the specific qualities of borders in terms of opportunity and willingness: ease of interaction and salience, respectively. Data generated by the GIS reconceptualization ‐ both maps and numerical measures ‐ are used to look at the nature of the contiguous borders that link enduring rivalry dyads, with a specific focus on Israeli borders. Even as a first‐cut, the GIS‐based reconceptualization is demonstrated to be of use by highlighting areas of opportunity and/or salience and informing policy choices.     

The determinants of efficiency: the case of the Spanish industry

The aim of this paper is to analyse the factors explaining the technical efficiency of Spanish industrial sectors during the period 1991–1994 using the Survey of Business Strategies (SBE) of the Ministry of Industry and Energy. It analyses whether efficiency can be explained by factors external to the firm such as the degree of competition in the markets in which it operates, characteristics of the firm (size, organization, advantages of location, participation of public capital, etc.), as well as the effects of dynamic disturbances that may affect the degree of utilization of the productive capacity.     

Options in technology investment games: The real world TFT-LCD industry case

The Thin Film Transistor-Liquid Crystal Display (TFT-LCD) industry has demonstrated that the investment of huge amounts of capital in new plants is a key factor for success. Decisions about investing in the latest generation of plant involve billions of dollars and a great deal of uncertainty. Moreover, the industry shows distinct oligopolistic characteristics, so the first mover's reactions must be considered when making capital decisions in such competitive environments. The traditional net present value (NPV) rule is a ‘now-or-never’ concept that fails to capture the need for managerial flexibility, which is especially important when investments are irreversible and involve a great deal of uncertainty. In this paper, we use a combination of real options and game theory to analyze the investment strategies of a case company in the TFT-LCD industry. The results show that real options reveal the value of flexibility, which NPV fails to consider. In addition, we apply game theory analysis to different investment strategies to demonstrate the decision-making processes used by competing companies.     

Cyclical industrial dynamics: The case of the global semiconductor industry

In this paper, we focus on firms' cyclical behavior in the global semiconductor industry. We demonstrate that these cyclical dynamics at the industry level differ from both the business cycles at the macro-economic level and the lengthy industrial technology life cycle. We discuss a range of possible causes of those cyclical industrial dynamics, including the general business cycles as well as industry-specific factors. Our study reports three stylized facts in relation to the cyclical industrial dynamics in the global semiconductor industry: first, the industry is more concentrated during the industry cycle downturns; second, the capital investment of the industry as a whole follows a ‘pro-cyclical’ pattern; and third, firms that pursued a ‘counter-cyclical’ capital investment strategy during the industry cycle downturn have reaped rewards during the subsequent cycle period. These facts suggest that cyclical industrial dynamics, especially the industry cycle downturns, play an important role in firm rivalry, strategic positioning and industrial growth.     

Government intervention in Malaysian manufacturing industries: a suggested methodology of measurement

The whole issue of the appropriate balance in dividing economic activities between the state and the market has, in recent years, received considerable attention. The proponents of ‘goverment intervention’ argue that government have to take a leading role in accelerating the structural change with is perceived as necessary towards achieving an efficient allocation of resources leading to a higher economic growth. Consequently, government have to rely on various policy measures which aim at reducing, if not completely erasing,the malfunctioning of the market. Here it is not the number of policies or regulations that matters. What is more important is the potential of each policy towards eliminating market imperfections. In this context, the crucial issue is the need for a direct measure to gauge the impact of each policy on selected problems which tend to contribute to the malfunctioning of the market. The objective of this paper is to suggest a method to measure the effect of government policies on reducing market concentration which is perceived as one of the sources of market failure. The applicability of the suggested methodology has been examined with a data set from the Malaysian Manufacturing Industries.     

Components of effective devaluation and the domestic rate of inflation: The case of Israel

Developing countries have frequently resorted to effective devaluation by changing either their formal rate of exchange, or by using non-formal components, such as taxes and subsidies. The ensuing increase in the domestic price of imports has inflationary effects. This paper analyses the Israeli experience to investigate the inflationary effects of increases in import prices and alternative methods of devaluation. It is found that formal and non-formal devaluation appear to have the same long-run effects on the price level, but are not the same in timing: A formal devaluation leads more quickly to increases in domestic prices.     

Price dispersion in the private health insurance industry: The case of Catalonia

This paper presents a vertical and horizontal product differentiation model that explains price dispersion among different kinds of health care insurance firms. Our model shows large insurance firms engaging in price competition with small mutual organizations that serve only a local area and charge lower premiums. We found that, although the market allows the entry of an excessive number of firms, the presence of local insurance companies increases social welfare by increasing the range of products available to consumers. Our conclusions are applicable to OECD countries in general although we rely on Catalonia's data.     

The motor vehicle industry in an emerging nation: the case of Brazil

As in other emerging nations, in Brazil, the motor vehicle industry is considered to be strategically important for economic development because of its backward and forward linkages and possibilities for export-led growth. This study analyses prospects for the industry by estimating an industry-level cost function that includes output of both vehicles and component parts with capital, labour and intermediate goods as inputs. The cost elasticity of output (an indicator of scale properties) and the elasticity relationships among inputs are explored. One unexpected outcome of the work that appears to be robust is that during early years of the study period, the industry had constant returns or even diseconomies of scale. However, during later years, when output was greater, there were economies of scale. This finding is likely the result of some combination of the entry of new firms, the development of new models or technological change. The study concludes that if firm output can be increased, economies of scale can be expected to strengthen the position of the Brazilian industry in the international marketplace.     

高科技产业发展中的政府与市场

知识经济呼唤高科技产业的快速发展,高科技产业的发展离不开政府和市场。本文拟对高科技产业发展过程中,政府的支持与市场机制的作用作一些探讨,以期找到政府调控和市场力量的最佳结合点,从而探寻促进高科技产业发展的途径。一、高科技企业的生命周期和资本需求特点高科技企业的生命周期一般可细分为6个阶段:即研究开发期、创业期、早期成长期、加速成长期、稳定成长期和成熟期。各个阶段具有不同的企业特征、组织结构和资金来源。表1描述了美国高科技企业的生命周期及其特征和资金来源。在高科技企业不同的成长阶段上,企业对资金的需求呈现出不同的特征。     

The globalisation of research in the pharmaceutical industry: A case of uneven development

The paper discusses different conceptualisations of the term globalisation of research. From this discussion five dimensions of globalisation of research are identified. Using three different type of data, the paper goes on to examine the extent, motivations and mechanism for the globalisation of research along these five dimensions among leading European and US pharmaceutical multinational companies (MNCs). The evidence for the period 1975–1998 shows that the general process of international expansion of research activities varied significantly between leading US and European MNCs. It is also clear that the development of the process of globalisation has proceeded unevenly along the five dimensions studied. The data also show the increasing concentration of both US and European research investment in the USA.     

The globalisation of research in the pharmaceutical industry: A case of uneven development

The paper discusses different conceptualisations of the term globalisation of research. From this discussion five dimensions of globalisation of research are identified. Using three different type of data, the paper goes on to examine the extent, motivations and mechanism for the globalisation of research along these five dimensions among leading European and US pharmaceutical multinational companies (MNCs). The evidence for the period 1975-1998 shows that the general process of international expansion of research activities varied significantly between leading US and European MNCs. It is also clear that the development of the process of globalisation has proceeded unevenly along the five dimensions studied. The data also show the increasing concentration of both US and European research investment in the USA.     

The effects of patent-law changes on innovation: The case of India's pharmaceutical industry

Recent patent-law changes in India's pharmaceutical industry provide opportunities to study changes of institutional and regulatory environments on innovation and social welfare in low-income markets. From 1972 to 2004 under its process-patent regime, India's pharmaceutical industry grew to become the world's fourth largest. Indian companies were becoming globally competitive in generics and clinical testing, and moving into product R&D. Researchers have debated the effects of India's new product-patent laws' effects on these trends. The authors cover the domestic characteristics and global competitiveness of India's pharmaceutical industry. They contrast data (from 2001 to 2004) on patents in India's process-patent regime with preliminary data (from 2005 to 2008) on patents in the country's new product-patent regime. They argue that Indian pharmaceutical companies have changed their decision-making in response to changed patent laws by moving from process to product research. However, the preliminary results indicate that these changes may have hurt domestic innovation. They conclude with strategic implications for the Indian pharmaceutical industry and highlight the need for research and public policy to establish optimal social returns from product-patent regimes.     

Incentive effects of benevolent intervention: The case of government loan guarantees

There has been a substantial recent growth in government loan guarantees to ailing firms in the United States. This paper investigates the potential incentive effects of this practice. Using the simplest available two-period model, it is shown that when firms know that loan guarantees may be forthcoming, they may be induced to adopt riskier investments and take on more leverage. These perverse incentive effects imply that the actual loan-guarantees-related contingent liability of the government could be much larger than suspected. Our policy recommendation is that the government either abandon the practice altogether or set up a federal agency that sells loan guarantees to all firms at prices that depend on the riskiness of the firm's assets and its leverage.     

Finance and industry: the case of Greece

This article argues that the Greek banking system contributed to the emergence of a weak, uncompetitive, and ultimately highly inefficient industrial sector. This inefficiency is quantified with the help of translog cost-curve estimates for 68 firms in eight industries. The estimation shows that Greek firms operate at too small a scale, relative to their capacity, and do not exploit scale economies. It was the structure of the financial sector, as it operated within the specific political context, that led to processes that dampened competition and ultimately distorted the country's development. The financial sector's behaviour is conditioned by three structural facets: it is an oligopoly; it possesses an internal hierarchy which is fully vertical; and it is state-owned. That the financial process led to inefficiency is confirmed by examining the counterexample of efficient industrial configurations. In this case, efficient industries were able to deny the potentially harmful policies of the financial sector. In conclusion, the structure of the financial sector, and by extension the structure of the state itself, played an important role in the Greek economy.     

Technological change and industry structure: A case study of the petroleum industry

This paper is a case study of the impact of an exogenous improvement of a process technology on the structure of the petroleum industry. The paper examines the role of three-dimensional seismology in bringing about the 1990s oil industry consolidation. This proposition is examined in the context of evolutionary economics and in a non-cooperative game theory, concluding with a reference to Steindl's theory of industry dynamics. The significance of this contribution lies chiefly in highlighting the fact that exogenous technological change can, under appropriate conditions, play a significant role in industry dynamics. This reference to the exogenous change in technology is a departure from the traditional consideration of endogenity of industry structure in relation to technological development and, therefore, a novelty. Secondly, the documentation of 3D seismology as a significant process technology of the petroleum industry is significant.     

Government intervention and the structure of social capital

Over the past decade, policymakers and scholars have devoted increasing attention to the nature and role of social capital in the functioning of society. We examine the implications of government attempts to manipulate the existing structure of social capital to create homogeneity among agents. We find that these attempts can weaken, erode or destroy existing social capital. We conclude with policy implications regarding government efforts to create or manipulate social capital.     

Determining the going market value of a business in an emerging information technology industry: The case of the cellular communications industry

Given the phenomenal growth or the anticipation of growth in certain information technology industries, concerns for economy of scale, market access and expansion, and the need for ongoing research and development are resulting in mergers, acquisitions, and strategic alliances. A key question in such industries is what is, or should be the going market value of a business? This paper suggests an approach to imbed market penetration models in the popular value-based planning approach suggested by Rappaport [36] to obtain the going market value of a business. The model developed in implementing the approach is tailored for the cellular communications industry. Limitations and adaptations of the approach to other industries are discussed.