Poland and the euro zone enlargement: Monetary policy,ERM II,and other issues

In this paper, Poland's preparations to introduce the euro and discussions surrounding them are briefly analyzed. Its first part deals with legal and macroeconomic developments before Poland's accession to the EU in May 2004. The second part considers Poland's official position and possible future scenarios. The main conclusions are twofold. Firstly, it is argued that after finishing successfully the disinflation process, Poland's monetary integration is above all subject to fiscal and exchange rate developments. In both cases, they are a function of the economy's structural changes. Secondly, as a consequence, fulfilling the Maastricht Treaty nominal convergence criteria by Poland will imply enough degree of real convergence for its successful participation in the euro zone. The opinions expressed in the paper are of the author and should not be attributed to any institution he is working for. He would like to expresshis gratitude to Witold Grostal and Robert Woreta for providing the graphs. Helpful comments were made by Michal Brzoza-Brzezina, Tomasz Chmielewski, and by Eduard Hochreiter. Language assistance was provided by Barton D. Raven. Any remaining errors are solely the author's responsibility.     

Monetary policy and EMU enlargement: Issues regarding ERM II and adoption of the euro in Estonia

The aim of the paper is to give an overview of the issues related to Estonia's entry into ERM II. For that purpose the article describes the official position of the Estonian authorities regarding entry into ERM II and the adoption of the euro, explains the rationale for early entry into ERM II, and presents the reasons for maintaining the currency board arrangement until full membership in EMU. Also, the challenges of the adoption of the euro are discussed. The article concludes that early entry into ERM II is appropriate as the perceived costs—short-term costs of fiscal consolidation and the cost of giving up independent monetary policy and flexible exchange rates as stabilization tools—are practically non-existent in Estonia. The paper argues that the high level of exchange rate stability and nominal convergence, relatively high flexibility of the economy, and integration with the euro area support the rationale for maintaining the currency board arrangement and adopting the euro early.     

North-South interdependence: An economic-physical interpretation

Summary The article gives a physical-economic interpretation to a number of economic North-South interdependent relations. Basic research evidence at the man-machine level was an inspiration; the output could only be expressed in physical specification terms. The corresponding generalizations are in product complexity, speciality terms also. This terminology is conducive to far-ranging extrapolations and generalizations. It eliminates the problem of pricing at the product level for all aggregation levels; therefore the fundamental economic relations are better expressed. The article concludes with a mega extrapolation in graphical terms, which relates the product and implied technological capability in the world, expressed in physical terms, for country groups ordered by three development levels. Correspondingly the comparative advantage and inter-industry trade areas at the world product level are shown.The author acknowledges valid comments of two anonymous referees and financial support by DGIS to the Technology Scientific Foundation for the research of which this paper reports certain aspects only. This paper came out as a working paper TSF 84-1. An earlier version was presented at the International Economic Association Meeting in Madrid, Sept. 1983. Clearly, only the author bears responsibility for the ideas and interpretations presented in the following text.     

Learning about fundamentals: The widening of the French ERM bands in 1993

Learning about Fundamentals: The Widening of the French ERM Bands in 1993. — The authors incorporate a Bayesian learning model into a fairly general model of exchange rate determination in discrete time. The model is applied to the period following the widening of the French-German ERM bands in August 1993, in which a systematic underprediction of the franc can be observed until February 1994. A (substantial) part of these forecast errors can be mimicked by a Bayesian learning process. Simulations with our model show that, after the widening of the bands, agents, contrary to their initial expectations, gradually learned that the true process driving monetary conditions in France had not changed notably.     

An economic interpretation of the Gibson relationship

For a given level of long-term growth, one would expect to find a corresponding relationship between a representative interest rate and a general price index. Keynes brought attention to the long-run relationship between the level of the price index and the rate of interest, called the Gibson relationship. Irving Fisher's analysis, on the other hand, suggested a long-run relationship between the inflation rate (rate of change of the price level) and the rate of interest. In this paper, empirical correlations for the Gibson and Fisher relationships, based on U.S. data, are examined over the past four decades. There is a slight preference for the Gibson relationship, on the basis of those correlations. There has been some interest in trying to "explain" the persistence of the Gibson relationship. If pricing follows a general mark-up rule, it is possible to provide structural specification for the Gibson relationship, and the corresponding correlations are estimated.     

Becker’s utility approach to discrimination: A review of the issues

Conclusion In general, most studies have been unable to confirm the predictions of the Becker utility approach to discrimination by employers and employees. This lack of verification would seem to indicate that the observed wage differentials are generated by a different or more complex process. However, such a strong statement is premature in view of the measurement problem that has been present in most studies. Becker’s model is a characterization of how individual employers and employees behave in the market. Empirical testing of Becker’s model requires detailed information about the degree and level of contact between the races, the wage rates paid to each race, skills of each worker, and the manner of employment and placement of each race. Invariably the lack of such detailed firm data, particularly wage rates, forces researchers to use aggregative data of income or earnings averages and occupation of workers employed within a state or broadly defined industry in order to generalize how firms behave in the market. The necessity of using such data, however, results in a dichotomy between the original parameters in Becker’s model and the data utilized. Clearly the lack of a significant association between the data utilized and the parameters specified in Becker’s model undermines the credibility of such empirical testing. The empirical analysis on the implications of Becker’s theory of discrimination has left a wide variety of unsettled questions and much remains to be done.     

The exploitation of dutch natural gas: An alternative approach

Summary Dutch energy policy is briefly reviewed and an alternative approach is suggested. A very simple model of the Dutch economy is presented which enables us to simulate the course of some macro-variables and of the pool of natural gas. Subsequently a sensitivity analysis is performed with respect to the parameters of the model. I am indebted to J.S. Cramer, R. Ramer, and C. Weddepohl for helpful comments and to A. Stokman and T. v.d. Mey who assisted in the calculations. All remaining errors are mine.     

Monetarism: The issues and the outcome

The paper surveys some main issues in the monetarist-Keynesian debate of the 1960s and 1970s and the outcome of the debate. The debate was not static; the issues changed. At first Keynesians argued that money was largely irrelevant for output and the price level. By the end of the 1970s, issues such as neutrality, the natural rate, and the effect of inflation on nominal interest rates had been settled. Principal remaining issues were the use of money growth as a target, instrument, or indicator of monetary policy and reliance on rules. The paper sketches some of the progress on rules versus discretion in the past 20 years but focuses mostly on the role of money. Some evidence is presented for the U.S. supporting the monetarist position that control of money is useful in a medium-term or rule-based policy to control inflation as now advocated by several central banks.Distinguished Address presented at the Forty-Fourth International Atlantic Economic Conference, Philadelphia, Pennsylvania, October 9–12, 1997. Thanks to Bennett T. McCallum and Robert H. Rasche for helpful comments and to Randolph Stempski for excellent assistance.     

Organization and economic behavior: An interpretation of recent findings

Conclusion Institutionalist theorists have long suggested that market power creates managerial discretion to diverge from competitive norms — for good or for bad [Spechler, 1978]. Where differences appear among them on how to conceptualize the objective, Baumol [1967] and Eichner [1976] have argued for growth maximization (subject to a minimum profit constraint), while Galbraith [1973] and the Carnegie “school” [see Cyert, March, 1963] have preferred an indeterminate combination of security, growth, prestige, and so forth.     

Security issues in Europe: An Asian perspective

The future of European and Asian security can no longer be separated owing to pervasive globalization, the rise of East Asia as a new geopolitical hub, and the increasing web of interests that binds the United States, the European Union (EU), and East Asia together. Of the three key relationships‐the transatlantic, the transpacific, and the Eurasian‐the latter remains the weakest owing to a combination of historical, political, and economic reasons. Improving this relationship from the strategic, economic, and conceptual dimensions will bring significant dividends to the two regions. Operationalizing this challenge, however, is going to be cumbersome and time consuming given the historical lack of strategic interaction between East Asia and Europe.     

基于全面风险管理的网络银行经济资本配置方法及调整

信息技术的进步推动了网络经济的迅速发展,人类逐步跨入信息时代,网络银行将会为实现这一跨越提供资金流的便利。由于其混业经营趋势与其所面临网络经济环境的复杂性,网络银行需要覆盖每一项业务、深入每个流程、规范和科学地全面风险管理。合理配置网络银行资本,能够有效地抵御风险,促进其良性发展,而这一过程需要基于全面风险管理的方法,将收益和风险直接挂钩。为可能出现的最大风险做出资本准备,使其和可持续盈利的目标相一致。文章正是从这一角度出发,结合网络银行的特性,研究RAROC技术在其资本配置中的应用,并探究了应用RAROC技术的支撑体系。     

The ERM and structural change in European labour markets: A study of 10 countries

The ERM and Structural Change in European Labour Markets: A Study of 10 Countries. — This paper tests for structural changes in European labour markets and attempts to associate them with the evolution of the ERM as well as with political and institutional developments. The results indicate that diverging sacrifice ratios, rather than tax wedge and productivity effects may be the strongest impediment to labour market convergence in the transition from the ERM to full economic and monetary union. The empirical work indicates that the ERM may have provided some pressure towards more symmetric responses to shocks, but the changes have not been great.     

An economic interpretation of conflict in Burundi

This paper uses economic and political analyses to investigatethe economics of civil conflicts in Burundi. It shows that conflictsin Burundi have resulted from a combination of poverty, governancepolicies of exclusion and the fight for the control of the country'slimited resources. The public sector being the main source offinancial accumulation, Burundian bureaucracy is analysed indetail and is found to be a predatory bureaucracy which caresfor its own interests. In order to avoid the recurrence of warin the country, it is recommended that Burundians, with theassistance of other fellow Africans and the international community,first of all break the cycle predation-rebellion-repression.Secondly, the paper recommends that a solution be found to thecountry's endless problem of impunity whereby criminals responsiblefor some of the most horrendous crimes have never been prosecuted.The paper remarks that the challenge of bringing peace to Burundiis tall, but that the current mediator, former South AfricanPresident Nelson Mandela, is probably the best but last hopeBurundians can count on to enjoy a peaceful future.     

The role of foreign direct investment in the host-country firm selection process: firm-level evidence from Slovenian manufacturing

This paper examines the role of inward foreign direct investment (FDI) in firm selection processes in the Slovenian manufacturing sector in the 1994–2003 period. It adopts the firm dynamics framework that allows testing of selection effects directly by assessing the impact of foreign firms’ activity on the probability of exiting of local firms (crowding out). The results show that intra-industry productivity spillover effects offset only a minor part of the competition pressure which results from foreign firm entry, hence incumbent firms experience a drop in their survival probability upon a foreign firm’s entry within a particular industry. This result is driven by foreign firm entry of the greenfield type, as entry through the acquisition of existing firms has no significant effect. The strength of the crowding-out effect decreases with the incumbent firm’s export propensity. There is no significant evidence that inward FDI would stimulate the selection process through backward linkages in the upstream supplying industries, whereas foreign firms’ activity reduces the exit probability of downstream local customers (through forward linkages).     

基于ERM的利益相关者价值探析

企业风险管理(Enterprise Risk Management,ERM)是近年来管理界最热门的一个话题,企业要求通过一定水平的风险管理,提升风险管理的能力,创造更多的企业价值,这涉及到利益相关者群体的价值.文章以COSO、普华永道、安永等机构的分析报告为研究背景,借助德勤的调查结果,从ERM与利益相关者的价值关系出发,分析价值流失因素及原因,提出解决价值流失和创造利益相关者价值的六项对策.     

An heterodoxical interpretation of the employment problem in Latin America

In this paper, I wish to defend the following hypothesis: the relative excess of labor that has traditionally characterized Latin American labor markets has been decreasing at least since World War II. The occupational situation, though still quite serious, has been improving considerably in most Latin American countries, not deteriorating, as is commonly regarded to be the case (the orthodox position).