On corruption,bribes and the exchange of favors

This paper investigates how the availability of alternative forms of bribe payments, on top of money, may facilitate corruption. There are two bribe payment technologies and a Corruptor and a Receiver must agree on the value and on the technology of the bribe. The paper infers which form of payment can be used by analyzing probabilities of punishment, bargaining powers of agents, and relative efficiency of the two different technologies. By assumption, monetary payments have distinct efficiency than do non-monetary favors. If the Receiver has a sufficiently high utility for payments using a particular technology, then only bribes paid via this technology are feasible. There is also a range of intermediate cases where monetary bribery is used if and only if the relative bargaining power of the Receiver is sufficiently large compared to that of the Corruptor.     

Sustaining Cooperation with Joint Ventures

Antitrust agencies and courts have expressed concerns that jointventures and strategic alliances between firms that competein other markets might serve to reduce the vigor of their competition.This article explores a mechanism through which a joint venturebetween two (or more) firms in one market can serve to facilitatecollusion in another market—even one unconnected verticallyor horizontally by costs or demand. In the models studied here,play in one market has the effect of altering players' beliefsabout their rivals' play in the second market. A joint venturein one market may provide a credible punishment mechanism forfirms colluding in another market. The joint venture may alsoprovide a vehicle for the transmission, between players, ofinformation in a way that helps cooperative types find eachother and collude in other markets. (JEL L12, L41, K21)     

Playing the wrong game: An experimental analysis of relational complexity and strategic misrepresentation

It has been suggested that players often produce simplified and/or misspecified mental models of strategic decisions [Kreps, D., 1990. Game Theory and Economic Modeling. Oxford Univ. Press, Oxford]. We submit that the relational structure of players' preferences in a game is a source of cognitive complexity, and may be an important driver of such simplifications. We provide a classification of order structures in two-person games based on the properties of monotonicity and projectivity, and present experiments in which subjects construct representations of games of different relational complexity and subsequently play the games according to these representations. Experimental results suggest that relational complexity matters. More complex games are harder to represent, and this difficulty seems correlated with short term memory capacity. In addition, most erroneous representations are simpler than the correct ones. Finally, subjects who misrepresent the games behave consistently with such representations, suggesting that in many strategic settings individuals may act optimally on the ground of simplified and mistaken premises.     

Nonlinear Pricing in General Equilibrium Models with Joint Production

This paper considers general equilibrium models of public utilities which produce either public goods or private goods. In the models, cases of increasing returns are not a priori excluded. The products of the public utilities and their costs are allocated to the consumers according to a rule that is dependent on information communicated to the public utilities. We show that if the public utilities follow a nonlinear pricing rule, the equilibrium allocations are always Pareto-optimal. Moreover, the message space is of finite dimensions.
JEL Classification Numbers: D51, D60, H41, H42.     

Research Joint Ventures with Asymmetric Spillovers and Symmetric Contributions

The paper proposes a new type of R&D cooperation between firms endowed with asymmetric spillovers, which we call symmetric Research Joint Venture (RJV) cartelization, based on reciprocity in information exchange. In this setting, firms coordinate their R&D expenditures and also share information, but such that the asymmetric spillover rates are increased through cooperation by equal amounts. It is found that this type of cooperation reduces R&D investment by the low spillover firm when its spillover is sufficiently low and the spillover of its competitor is sufficiently high. But it always increases the R&D of the high spillover firm, as well as total R&D (and hence effective cost reduction and welfare). A firm prefers no cooperation to symmetric RJV cartelization if its spillover rate is very high and the spillover rate of its competitor is intermediate. The profitability of symmetric RJV cartelization relative to other modes of cooperation is analyzed. It is found that symmetric RJV cartelization constitutes an equilibrium for a very wide range of spillovers, namely, when asymmetries between spillovers are not too large. As these asymmetries increase, the equilibrium goes from symmetric RJV cartelization, to RJV cartelization, to R&D competition, to R&D cartelization.     

合作创新伙伴选择的ANP方法研究

从目前技术创新的参与主体看,多个实体通过合作的形式完成创新已经成为一种潮流。通过对整个联合创新系统经济效益的评价,可以间接地测定其合作伙伴选择是否合理。建立了合作创新系统经济效益的评价指标体系,并运用ANP(网络分析法)方法对整个系统的经济效益进行评价。该方法可以克服评价因素之间的相关性,为合作创新伙伴选择提供了一种定量的判断依据。     

Joint tax evasion

Tax evasion analysis typically assumes that evasion involves individual taxpayers responding to some given policies. However, evading taxes could require the collaboration of at least two taxpayers. Detection depends on the costly avoidance activities of both transacting partners. An increase in sanctions leads to a direct increase in the expected cost of a transaction in the illegal sector, but it may also increase the incentive for the partners to cooperate in avoiding detection. The total cost of transacting in the illegal sector can fall, and tax evasion may increase. The policy implications of this phenomenon are considered. JEL Classification: H26
L'évasion fiscale collective. Dans les analyses de l'évasion fiscale, on suppose habituellement que le payeur de taxe fait face à un ensemble donné de politiques auxquelles il réagit. Pourtant, dans le cas des transactions marchandes, l'évasion fiscale n'est possible que si plusieurs agents coopèrent ensemble. La probabilité que l'évasion soit détectée dépend alors des efforts que chacun fait pour la cacher. Dans un tel contexte, de plus lourdes sanctions accroissent le coût espéré des transactions illégales, mais peuvent aussi, indirectement, accroître l'incitation pour les partenaires à coopérer pour cacher leur activité illégale. Il en résulte que le coût total des transactions illégales peut diminuer et l'évasion fiscale augmenter. Nous étudions les implications de ce phénomène.     

Organization Design and Information-Sharing in a Research Joint Venture with Spillovers

The paper presents a non-tournament model of process innovation with spillovers in the R&D process when firms engage in Cournot competition in the product market. It is shown that careful modelling of information-sharing and coordination of research activities leads to the conclusion that a Research Joint Venture (RJV) will economize on scarce R&D resources. There is an analysis of the effects of R&D cooperation, in the form of an RJV, on the organization of R&D, i.e. the efficient number of research labs. R&D expenditure, which precedes production, results in lower unit costs. R&D is modelled as a two-stage process: in the first stage, firms incur expenditure that will generate new knowledge, while in the second stage this knowledge is employed to reduce unit costs. A distinction is made between single and complementary research paths. It is shown that the RJV will operate one lab in the case of a single research path exploiting its coordination advantage. In the case of complementary research paths the number of labs the RJV will operate crucially depends on the stage of the R&D process at which diminishing returns occur: it will operate both labs when diminishing returns occur at the first stage (creation of knowledge), while it will be indifferent as to the number of labs, one or two, when diminishing returns occur in the second stage (cost reduction).     

Under–provision of Inputs in Joint Ventures with Market Power

A joint venture with market power benefits from restricting its output which, in turn, requires the partners to restrict the supply of their inputs. However, since each partner benefits only partially from restricting its input, both over–supply their inputs from the viewpoint of the optimal use of market power. We show that this pecuniary negative externality in the partners' input decisions mitigates the standard under–provision problem that arises in joint ventures. We also show that the degree of this problem declines as demand becomes less elastic.     

Joint production in teams

Consider Holmström's moral hazard in teams problem when there are n agents, each agent i has an a_i-dimensional strategy space and output is m-dimensional. We show that a compensation mechanism that satisfies budget balance, limited liability and implements an efficient allocation generically exists if and only if . Moreover, under a weak additional condition, the equilibrium implemented by this mechanism is unique in the class of pure strategy Coalition-Proof equilibria.     

Joint liability among bank borrowers

Summary. A common feature of financial intermediaries is that the welfare of one borrower is adversely affected by the poor performance of other borrowers. That is, there exists a degree of joint liability among the borrowers of a financial intermediary. This paper provides an explanation for this observation. It demonstrates that in Krasa and Villamil's [14] formalization of a financial intermediary as a delegated monitor, intermediation with joint liability between borrowers Pareto dominates intermediation without joint liability.Received: 4 September 2002, Revised: 21 March 2003, JEL Classification Numbers: D8, E5, G2, G3.I am particularly indebted to Douglas Diamond and Robert Townsend for their advice on this paper. I thank an anonymous referee for helpful comments.     

历史回顾:民营经济的从有到无——公私合营

<正>上世纪50年代在中国所发生的“公私合营”,是中国以个体工商业和私营企业为代表的民营经济成分从“有”到“无”的过程,其目的是“走社会主义公有制道路”。1949年,新中国第一届政治协商大会在北平召开,通过了相当于临时宪法的《共同纲领》,提出“使各种经济成分在国营经济领导之下,分工合作,各得其所,以促进整个社会经济的发展”的任务,这一宣言团结了当时的爱国民族资本家和私营企业主。     

Joint search for several goods

Joint search occurs when a buyer incurs a single cost to observe prices of several different goods. If the prices are drawn from a known joint distribution function, the optimal sequential strategy with no recall uses a reservation sum for any subset of items. When the observed prices total more than the corresponding reservation sum, not all goods will be bought and search continues for items not purchased. Thus, regions in the price space are associated with various buy-search decisions. The reservation sums, however, have properties analogous to those of the reservation price with search for one good.     

Joint outputs and real wage rates

The magnification effect in standard international trade theory asserts that if the relative price of the labor-intensive commodity increases, the real wage will also increase, as will the wage/rental ratio. This result depends upon the assumption that both activities are nonjoint—each combining labor and capital to produce a single output, so that if activities are joint instead, the results are in jeopardy. It is shown that if the difference between the share of commodity one produced in the first activity and in the second activity exceeds the difference between the labor distributive shares in the first activity and the second, an increase in commodity 1's relative price raises the wage/rental ratio. The real wage unambiguously rises in this case if and only if the ratio of the commodity output shares in the two activities exceeds the ratio of labor shares.     

小额信贷的小组联保机制运行机理与创新研究

小组联保是小额信贷的主要特征。本文在分析小组联保机制理论内涵的基础上 ,对其进行博弈分析 ,并提出完善小组联保机制的一些建议。