On disequilibrium adjustment processes

Here, we study a class of disequilibrium processes defined by differential inequalities, where prices are adjusted according to the agent's short-term demands, in both pure exchange and monetary settings. We establish convergence theorem and accessibility theorem without convexity hypotheses on the utility functions.     

Optimal design of trade institutions

We model an economy with social institutions that facilitate trade and induce three types of costs: establishment costs, access costs, and use costs. Use costs are specific transaction costs related to the use of these trade institutions. We assume that a trade institution is economically completely determined by the costs it imposes and by the effects on the trades it facilitates. We extend the Pareto efficiency concept to include various modes of organization of social institutions: the costs and benefits of these organizations are expressed in the trades they facilitate.Within this setting we discuss a valuation equilibrium concept, in which all agents use a common conjectural price system that assigns to every trade institution the price vector that would prevail under it. This feature of the equilibrium is important in securing the second welfare theorem, and is new to the analysis of economies with costly trade. Since the use costs can be nonlinear, there are non-convexities that prevent the second welfare theorem from obtaining in a finite economy, but we show it for large economies.Received: 3 April 2002, Accepted: 30 April 2003, JEL Classification: D59, D70, H49Robert P. Gilles: donewhile visiting the Center for Economic Research, Tilburg University, Tilburg, The Netherlands. Financial support from the Netherlands Organization for Scientific Research (NWO), grant B46-390, is gratefully acknowledged.Dimitrios Diamantaras: Part of this research wasSupport from Temple University via a Fuller research fellowship is gratefully acknowledged.The authors would like to thank Suzanne Scotchmer, Andreu Mas-Colell, Marcus Berliant, Shlomo Weber, Hans Haller, Dhanajay Gokhale, Julian Manning, and two anonymous referees for their valuable comments and discussions of previous drafts of this paper. A previous version of this paper was circulated as Equilibria of economies with costly trade.     

Economic freedom and public,non-market institutions: evidence from criminal prosecution

Economic freedom, which measures the protection of property and freedom to contract, is generally argued to capture the quality of a state’s institutions regarding market activity. As to be expected, numerous studies have found that economic freedom is associated with good economic outcomes. Additionally, much effort in public economics has worked to identify the features of quality non-market public institutions. No effort has been made to connect institutions that influence market activity and institutions that govern non-market activities. We take a first step. We employ a linear programming method for measuring relative efficiencies known as Data Envelopment Analysis. We apply this technique to information on the use of inputs to the production of the prosecution of crime across the thousands of local prosecutor offices in the U.S. We then compare state-level measurements of prosecution productivity with data on state-level economic freedom from the Economic Freedom of North America index. We show that there is a positive and statistically significant relationship between the two. Those states that develop institutions respecting economic freedom also tend to be the states that develop efficient publicly-provided services. The results are extended to complementary economic freedom measurements.     

Research design in total institutions: problems,pitfalls, and possible solutions

Research in total institutions is fraught with problems and pitfalls rarely discussed in methodology and research design textbooks but regularly encountered in the literature. Five of the major relevant problems in research designs for this area are considered, examples of the pitfalls are given, and suggestions for minimizing or overcoming them are offered.     

International competition and pay,working time and employment: exploring the processes of adjustment

The internationalisation of markets, competition and regulation is increasingly recognised. So far, however, debate about the effects has been largely speculative. This article examines the UK engineering industry. Survey evidence suggests that international comparisons are relatively unimportant, little benchmarking is going on and that stability characterises pay and working time arrangements. Further interview evidence explains that this is because pay and working time are set with employee expectations in mind, whereas it is the treatment of unit costs that reflects international pressures. As a consequence there has been substantial reductions in employment as well as some important changes in work organisation, even if there has been little change in pay or working time systems. In effect, it suggests that there is a form of ‘implicit contract’ taking place. A wider implication is that the main impetus for the ‘Europeanisation’ of industrial relations is likely to come from the growing convergence of costs rather than pressures for wage parity.     

A continuity property for local price adjustment mechanisms

This paper makes a case that a (local) continuity property is a reasonable one for any local price adjustment mechanism. This property means that if the starting points (i.e., initial prices) of the adjustment process are ‘close' to one another, and if the characteristics of the economies are ‘close' to one another, then, given any price adjustment mechanism, agents should compute equilibria that are ‘close' to one another. Under preferences which satisfy a ‘surjectivity hypothesis', it is shown that the tâtonnement process satisfies this continuity property on a nice subset of the space of all economies. A characterization of these economies for which the tâtonnement process is locally stable is given. Chart logic is a useful way to think about the path dependent property of implied volatility and about the relationship between implied volatility and historical volatility.     

Corruption, institutions and regulation

We analyze the effects of corruption and institutional quality on the quality of business regulation. Our key findings indicate that corruption negatively affects the quality of regulation and that general institutional quality is insignificant once corruption is controlled for. These findings hold over a number of specifications which include additional exogenous historical and geographic controls. The findings imply that policy makers can focus on curbing corruption to improve regulation, over wider institutional reform.     

Corruption, institutions and trade

The economics literature describes various factors that affect trade between countries, which, in addition to the standard economic and geographic factors, also include cultural, ethnic and historical factors. The present study is apparently one of only a few attempts in the literature to examine directly the effects of corruption on trade and the first attempt to examine trade over time in a specific country whose level of corruption changed significantly. Israel was chosen as the subject of the study mainly because of the fact that, according to international indexes, the country’s status as a civil society has declined significantly over the past decade. According to the corruption index of Transparency International, Israel was ranked 33rd in the world, at the end of the sample period in 2008, having fallen from 14th in 1995. The results of the research can serve as the basis for comparison to similar studies of other Western countries. The study’s conclusions support the hypothesis that the effect of corruption on trade of any given country is significant, stable and negative.     

Strengthening organizational ambidexterity with top management team mechanisms and processes

Abstract

Organizational ambidexterity is the organizational capability to simultaneously pursue explorative and exploitative innovation strategies. Studies have examined the Top Management Team (TMT) actions and decisions with the ambidextrous orientation of a firm. Further, studies have also shown that a behaviourally integrated TMT is positively associated with organizational ambidexterity. However, there has been limited research examining the antecedents to the behaviourally integrated TMT. Anchored in the upper echelons perspective, we have examined the influence of TMT processes and mechanisms on organizational ambidexterity. The TMT is observed to positively influence ambidexterity by enhancing the firm’s ability to meet the differentiation-integration challenges, and by facilitating the effective deployment of ambidextrous Human Resource (HR) architectures for employee learning. Thereby, this investigation examines the effect of TMT processes and mechanisms in enabling structural as well as contextual ambidexterity. The results from a sample of 78 hi-tech Small and Medium Enterprises (SMEs) across different industries were analysed using partial least squares structural equation modelling. We find the mediating role of TMT behavioural integration in the effect of TMT connectedness and TMT cross-functional interfacing mechanisms on organizational ambidexterity. However, our results show that rewards contingent on organizational performance do not motivate the TMT members to facilitate organizational ambidexterity. The results from this study lend support to the upper echelons perspective and add to two distinct streams of literature namely organizational ambidexterity and behavioural integration.     

Simultaneous determination of product attributes and prices, and production processes in product-line design

Global competition, rapid changes in technology, and market fragmentation have resulted in shorter product life cycles. In order to remain viable, it is increasingly important for firms to introduce new products frequently. Product design is a complex process that involves coordination of activities among several functional disciplines within the company as well as the customers and the suppliers. Traditionally, the information flow among the various product development stages has been sequential. However, there is increasing evidence to suggest that an integrated approach that considers several stages simultaneously may be superior.This paper provides a decision support tool for implementing such an integrated approach. On the basis of given customer preferences, the paper presents a model for determining the number of new products to be introduced, the exact specifications of these products, and the production processes for efficiently delivering these specifications. These decisions are made in an integrated manner by simultaneously considering the interaction among the various choice variables. A decomposition-based solution procedure is developed that iterates between the product design and process selection decisions while maintaining an effective link between them.In addition to understanding the economic value of adopting the integrated approach to product design, the paper discusses how the proposed model can be used effectively to perform sensitivity analysis with respect to some of the important decision variables.     

Co-ordination and integration mechanisms to manage logistics processes across supply networks

Literature on supply chain management (SCM) emphasises the importance of co-ordination and integration mechanisms to manage logistics processes successfully across supply networks. This requires managers to (1) know the driver variables that must be addressed, since they determine how such processes can be designed and managed; and (2) understand how co-ordination and integration mechanisms interact with such variables and—as a consequence—with logistics processes. The paper addresses the second issue, as it tries to explain how logistics processes can be structured and controlled across supply networks by leveraging co-ordination and integration mechanisms, with consequences for strategic and operational choices for both the individual companies and the whole supply network. This issue has been investigated by analysing three case-studies of SCM interventions on logistics processes across different supply networks, involving central firms as well as several suppliers and customers.     

Dumping, adjustment costs and uncertainty

Domestic demand uncertainty in the presence of adjustment costs can cause profit-maximizing firms to sell output abroad at a loss. Firms may dump output at prices below long-run marginal and average productions costs with probability arbitrarily close to one. The model predicts dumping is particularly likely in process industries such as steel. Closed form dumping solutions and interesting comparative statics are obtained. Also, the effect of domestic competition on dumping is examined. I find domestic competition increases total dumping, although a monopolist maximizing output subject to a zero expected profit constraint will dump more than a competitive industry.     

注重从创新机制上加强事业单位领导班子建设

班子建设作为党的建设新的伟大工程的核心内容,只有以改革创新精神,才能适应新世纪新阶段的发展要求,才能为全面建设小康社会提供坚强有力的保证。     

从金融监管看金融机构的退出设计

本文在对金融监管过程中安全与效率的矛盾和金融监管内容进行分析的基础上,提出了从市场方式和金融监管两个方面构建金融机构退出机制的构想.     

Finance,institutions, and innovation activities in China

Using novel firm-level micro-panel data in China from 2000 to 2009 and data on institutional factors, we study which funding sources effectively finance firm innovation activities in China and how the effectiveness of funding sources varies according to the quality of institutions. We show that institutional factors impact the effectiveness of each funding source in different ways. First, when property rights are better protected against the risk of expropriation by the government, internal financing from net profit—namely, the reinvestment of profit—is more important in financing firm innovation activities. Second, as contracts are enforced more reliably, trade credit finance and bank finance play larger roles in financing firm innovation activities.     

The design of capital budgeting processes and the corporate context

This study investigates how differences in the degree of capital budgeting sophistication and formalization are related to the corporate context. A model was developed and the expectations in the model were explored with data gathered from 146 major UK firms. The results generally support the model and show that the investment procedures and techniques adopted by firms may be partly explained in terms of the corporate context.     

Relationship between organizations, institutions, entrepreneurship and economic growth process

The main goal of this paper is to show that organizations and institutions play a relevant role in the economic growth process, both directly and indirectly. Human capital plays a direct role by facilitating the introduction and use of new technologies. A more indirect role is play by entrepreneurial activity in three ways: 1) supplying monetary funds; 2) creating an adequate social climate and 3) encouraging trust in the society. The hypotheses introduced are tested using the data on eleven countries.