The Determinants of Nonfarm Income Diversification in Rural Peru

This paper shows that in Peruvian rural areas, there has been substantial growth over the past decade in household employment outside of own-farming. At present 51% of the net income of rural households comes from these off-farm activities, and thus they certainly cannot be considered as “marginal.” The reasons households diversify their incomes are several. Access to public assets such as roads and private assets such as education and credit is an important factor in diversification. Increasing access to these assets will help rural households to increase their self-employment as well as wage employment in the nonfarm sector.     

THE SOCIAL SECURITY SYSTEM IN HONG KONG: ESTABLISHMENT AND READJUSTMENT OF THE LIBERAL WELFARE MODEL

Hong Kong's social security system has followed a “liberal” welfare state regime. The system has undergone changes along with the high economic growth, changes in the labor market, and transformation of the political environment, but has retained the fundamental principle of a social security system led by the private sector. In recent years, Hong Kong has responded to the aging population and growing unemployment by introducing the Mandatory Provident Fund Scheme that requires individuals to join private‐sector pension schemes and by intensifying cooperation with nongovernmental organizations. This indicates the deep‐seated nature of the influence of the liberal regime in Hong Kong.     

Investment appraisal in the public sector

Recent developments, such as privatization and the private financeinitiative, have raised the issue of which assets should beowned by the public sector and whether assets have differentvalues in the public and private sectors. In order to answerthe questions, we first note that the allocative considerationsthat usually motivate government intervention need not requirethe direct provision of services by the government using government-ownedassets. We then argue that the government should own the assetsused to provide the services where the private sector fearsexpropriation by the government, or where ownership conferson the private sector such power as to preclude efficient allocations.Finally, we argue that the discount rate for governments' projectsequals the expected return on comparable investments in thecapital markets. The government should, however, discount pre-taxcash flows at the pre-tax discount rate, for it receives alltax revenues.     

The Great Compression of the 1940s: The Public versus the Private Sector

Between 1940 and 1950 wage differentials narrowed substantially, a phenomenon that economic historians have called the “Great Compression.” This paper dis-aggregates the Great Compression into changes within and between the public and private sectors. We show that wage differentials declined in the public sector as well as in the private sector; had the public sector decline not taken place, the Great Compression would have been substantially smaller. In this regard, the experience of the 1940s stands in stark contrast with that of the past two decades, during which a relatively rigid public sector wage structure has dampened overall increases in wage inequality.     

Why Research Partnerships Really Matter: Innovation Theory,Institutional Arrangements and Implications for Developing New Technology for the Poor

This paper explores the conceptual basis for existing and emergent institutional patterns in the context of partnership approaches to technology development. Drawing examples from recent studies of private enterprise activity in India smallholder horticulture, it suggests that agricultural innovation as a process involves a wider range of organizational types than the conventional policy focus on public sector research organizations would tend to suggest. It uses the concept of a “national innovation system” to argue that a partnership approach is adopted as a core methodology for engaging science and technology development with the livelihood demands of the poor.     

Corruption as an Occupational Choice: Endogenous Corruption and Tax Policy

Corruption is endemic in many countries, and empirical studies have demonstrated how it impacts on macroeconomic indicators. Theoretical studies have generally assumed an exogenously given proportion of the population are corrupt or that the public sector is fixed in size; far fewer explore how corruption emerges endogenously. We endogenize corruption as an occupational choice. Workers choose private or public employment; public employees can be honest or corrupt. Corruption is subject to a social sanction that results in a loss of self-esteem. Those who care little about the social sanction choose to be corrupt. When a firm meets a corrupt public employee it pays a bribe to secure a reduction in the tax rate. The economy has two self-sustaining equilibria with different levels of corruption. Corruption reduces tax revenue and the tax rate that maximizes revenue. An increase in the social sanction reduces corruption but also reduces tax revenues if the economy is in a high-corruption equilibrium. Paying a wage premium to public sector workers can result in all public sector workers being corrupt. Public sector audits to detect corrupt workers always reduce corruption but can only increase welfare when they are cheap to conduct and the economy is in a low-corruption equilibrium.     

GOVERNANCE INSTITUTIONS AND PRIVATE INVESTMENT: AN APPLICATION TO THE MIDDLE EAST AND NORTH AFRICA

This paper addresses the issue of the low level of private investment in the Middle East and North Africa (MENA) region, with special emphasis on the role of governance. Based on the existing published reports, we categorize what types of governance institutions are more detrimental to entrepreneurial investments. We then estimate a simultaneous model of private investment and governance quality where economic policies concurrently explain both variables. Our empirical results show that governance plays a significant role in private investment decisions. This result is particularly true in the case of “administrative quality” in the form of control of corruption, bureaucratic quality, investment‐friendly profile of administration, law and order, as well as for “political stability.” Evidence in favor of “public accountability” is also found. Our estimations also stress that structural reforms like financial development, trade openness, and human development affect private‐investment decisions directly, and/or through their positive effect on governance.     

The “New” Kerala Model: Lessons for Sustainable Development

The “Kerala model of development” has won wide international attention for its achievements in regard to social development and, to a certain extent, environmental sustainability. The “old” Kerala model, preoccupied with redistributive policies, failed, however, to induce economic development. As a result, attention is now being given to a “new” Kerala model. The new policy explicitly seeks reconciliation of social, productive and environmental objectives at the local level, and tries to develop synergies between civil society, local governmental bodies and the state government. The new Kerala model thus holds important lessons for participatory, community-based sustainable development in India and elsewhere.     

Are local governments maximizing land revenue? Evidence from China

This paper examines how political considerations affect local officials' revenue maximization behaviors in the context of urban land conveyance in China. Particularly, we analyze government intervention based on local officials' choice of two land auction types, namely, “English auction” and “two-stage auction”. The latter presumably serves as a tool of government intervention. We aim to address the research question: “Are local governments maximizing land revenue?” The major findings are threefold. First, for cities with higher housing prices, two-stage auctions are adopted more frequently than English auctions. In addition, land parcels in these “hot” cities adopt two-stage auctions more frequently during sensitive political events, suggesting that local officials respond positively to the real estate regulation policy from central government. Second, when city leaders are more incentivized to promote economic performance, they respond less positively to rises in housing prices. Third, such interventionist behavior results in a significantly depressed land price and housing price. Despite its intention of improving public welfare, this interventionism can susceptibly cause problems of misallocation and corruption.     

French experience of public-private sector cooperation in high technologies

Mechanisms of public—private cooperation in science-and-technology modernization are discussed. This cooperation is manifested in the financing by the state of major high-tech projects, aimed at modernizing the economy and sustaining the economic growth, as well as of small-scale and medium innovational enterprises. In 2005, France decided to diversify its innovational mechanisms in response to the report “Toward a New Industrial Policy” by Jean-Louis Beffa, president and CEO of Saint-Gobain. Specialized finance institutions have been founded and 66 “poles de compétitivité” (“competitiveness clusters”) assigned, six of which are to implement global-scale projects. France’s experience of public-private cooperation for innovation can be useful for Russia too.     

Credibility and Reputation Building in the Developmental State: A Model with East Asian Applications

We use a game-theoretic model to analyze the role of credibility, reputation and investment coordination in a developmental state. Our model focuses on why a “soft” state serving narrow social groups so often obtains in less-developed countries and under what conditions a “hard” or developmental state can emerge. The model highlights the dilemma that although state and private sector alike may want economic growth, both must simultaneously invest to achieve it. But the equilibrium outcome—analogous to the prisoner's dilemma—is investment by neither. Even when initial conditions are favorable and a state is potentially developmental with the genuine capability to elicit private sector investment, this may not materialize and an equilibrium of low, or no, investment will prevail. To avoid this deadlock and foster growth, the successful developmental state must demonstrate commitment by promoting its “developmental” credentials through a process of reputation building. A consequent incentive to act “tough” together with seeming advantages of authoritarianism in implementing the developmental state may help to explain why it is often associated with an authoritarian political system.     

‘Stop‐go’ policy and the restriction of postwar British house‐building

From the mid‐1950s to the early 1980s the Treasury and the Bank of England successfully advocated a policy of restricting both private and public sector house‐building, as a key but covert instrument of their wider ‘stop‐go’ macroeconomic policy framework. While the intensity of restrictions varied over the economic cycle, private house‐building was restricted (through limiting mortgage availability) for almost all this period. This was achieved by keeping building society interest rates low relative to other interest rates and thus starving the building society movement of mortgage funds. Mortgage restriction was never publicly discussed and sometimes operated alongside ambitious housing targets and well‐publicized policy initiatives to boost housing demand. This article outlines the evolution of house‐building restriction, together with its impacts on the housing sector and the wider economy. We review the evolution of the policy framework and its consequences, compare the level and stability of British house‐building during this period—historically and relative to other countries—and undertake time‐series econometric analysis of its impacts on both house‐building and house prices. Finally, implications for debates regarding stop‐go policy, Britain's housing problem, and the distributional consequences of government macroeconomic policy are discussed.     

South Africa's infrastructure service delivery needs: The role and challenge for public‐private partnerships

South Africa's development challenges include over R100 billion needed in investment in infrastructure over the next ten years. Municipalities lack the institutional and financial capacity to address this alone and have to raise private sector finance to supplement their own resources and government grants. The borrowing of capital requires a well‐run administration that is able to raise sufficient revenue to meet all running costs, including loan redemption. Municipalities are showing increasing interest in municipal service partnerships (MSPs), including public‐private partnerships (PPPs), as a way of improving efficiency and accessing capital markets. This raises a number of challenges that include understanding and dealing with the continuing negative perceptions of the role of the private sector; clarifying the roles of the private sector and the government, especially local government; and addressing those issues necessary to produce effective and efficient MSPs in South Africa.     

ECONOMIC ANALYSIS ON THE URBAN–RURAL DISPARITY IN HUMAN CAPITAL IN CHINA

With China's economic development and capital accumulation in the industrial sectors, the human capital level of the labours moving from the rural areas could no longer meet the demand of the industrial sectors. Therefore, “structural shortage of technical labour” emerged in the labour market as a result of excess of demand for high‐skilled workers. Previous literature mostly focused on the relationship between rural human‐capital level and labour movement, income change and economic growth, but in this article, the authors focus on the study of the relative disparity of urban and rural human capital and labour movement, as well as the effect of the change of urban–rural human capital gap on industrial output, profit and social welfare. This article shows that bridging the urban–rural gap in respect of human capital level could not only improve the situation of the “structural shortage of technical labour,” but also have a positive effect on the general social welfare.     

The Economic Value of Time: Evidence from Africa

When excessive and inefficiently implemented, government interventions can result in significant economic losses for citizens. These include the often‐significant cost of lost time. This paper thus aims to estimate the potential economic welfare benefit of reducing public office waiting times. Based on data from Johannesburg, Lagos and Addis Ababa, we show that a one‐hour reduction in waiting time improves welfare by 66‐74% of the average local wage. High‐income earners, college graduates and private‐sector employees enjoy higher gains. Moreover, we note that the proxies currently used to quantify time‐saving benefits diverge significantly from the rate at which individuals substitute time for money. Our analysis also indicated a substantial delay‐induced citywide efficiency loss. Introducing public–private partnership and charging premium fees for faster service delivery are justifiable both on grounds of equity and efficiency.     

Measuring the Welfare Effects of Reform: Urban Water Supply in Guinea

Reforming public utilities remains high on the agenda of economists and policy-makers. Few studies however have measured the impact of these reforms on welfare. This paper analyzes the radical changes in the arrangement providing water to Conakry (Guinea) and estimates the consequences of that reform on consumers, the government, and the foreign owners involved in the process. It shows that notwithstanding a difficult institutional environment, private sector participation benefited all constituents. It does so using a comparative method, with the actual results compared to a counterfactual scenario. The robustness of our results is supported by sensitivity tests.     

混合型组织:概念与类别再探究

本文构建了"理论视角—定义逻辑"的混合型组织概念认知范式,基于理论视角将混合型组织本质的已有认知归纳为治理方式观、建构形式观和组织形态观,认为它们可以收敛于组织形态观;基于定义逻辑将混合型组织概念的已有界定方式归结为以"元素混合"为核心和逻辑起点的定义方法、以"特征介于"为核心和逻辑起点的定义方法,并结合二者形成基于元素混合的特征刻画法。在此基础上提出了具有包容性与解释张力的混合型组织元定义和反映混合型组织运行完整"画像"的操作性定义,以期引导人们走出混合型组织的"概念丛林"。本文对混合型组织既有的多种分类方法进行了批判性审视,建立了"元素特征组合—混合度"的混合型组织类别识别与判定框架,并聚焦于组织社会学领域的混合型组织类型,将组织的商业性与社会性两个维度、混合度阈值与类别结合起来,考虑最低混合强度要求,廓清了不同类别混合型组织所处的区域边界。     

Buyer‐Induced Exclusive Dealing

Large retailers may exercise buyer power in their interactions with manufacturers. This article explores the use of exclusive dealing arrangements by a monopoly retailer when purchasing a differentiated product from competing manufacturers. Interactions among the firms are modeled as a bargaining game. When consumers' brand preferences are weak and/or when one brand is preferred by a significant majority of consumers, it is more profitable for the retailer to negotiate an exclusive dealing arrangement with one of the manufacturers than to distribute both products. Also, it is more profitable for the retailer to induce exclusive dealing if the manufacturer of the excluded brand has a lot of bargaining power when negotiating with the retailer. If buyer‐induced exclusive dealing reduces the retail price of the exclusive brand in order to encourage “brand switching” by consumers who favor the excluded brand, the practice may increase consumer welfare and even total welfare.     

State‐Owned Enterprises,Competition, and Disclosure

We develop a mixed‐duopoly model in which a private firm competes against a state‐owned enterprise (SOE) who cares about social welfare and is privately informed about market demand. When the SOE's social concerns are sufficiently important and when the market competitiveness is sufficiently low, the SOE commits to fully disclose its private information. Otherwise, the SOE commits to withhold its private information. When the disclosure equilibrium prevails, the private firm can be more profitable competing against an SOE than against another private firm. In this mixed‐duopoly setting, the equilibrium social welfare is maximized when the SOE puts a positive weight on both social welfare and its own profit. Our analysis has further implications for both mandatory disclosure and market entry.     

A comparison of the wage structure between the public and private sectors in Japan

This study compares the wages in the public and private sectors in Japan. In addition to comparing overall wage levels, we examine the differences in the wage structures, specifically, the relative wages by gender, age, education, and region. The size of the public sector wage premium depends crucially on the size of the private companies chosen as the comparison group. Wage gaps by gender and educational attainment are smaller in the public sector than they are in private companies. The public sector's age–wage profile is steeper than that of the private sector. Public sector wages are more compressed. In other words, the wages are relatively higher at the lower end of the wage distribution and relatively lower at the higher end. The regional wage differentials are smaller in the public sector. Here, the wage levels of public sector workers are relatively higher in rural regions and relatively lower in large metropolitan regions. To ensure the efficient provision of public services, it is inappropriate to compare only mean wages.