Trade Union Membership in Europe, 1960–1990: Rediscovering Local Unions

This article compares union density rates in seven Western European countries between 1960 and 1990. In contrast to conventional analyses, the paper argues that, in countries where workplace union organization is well developed, and where unions have managed to turn the official institutions for workers' participation such as works councils into extensions of their operations, they fared better during the 1960s and 1970s than in countries where this was not the case. This difference in the fate of unions was even more pronounced during the 1980s. Unions with strong locals lost few members or actually gained some, while unions without strong local structures saw union density drop by between one-quarter and one-third.     

VERTICAL MERGERS,FORECLOSURE AND RAISING RIVALS' COSTS – EXPERIMENTAL EVIDENCE*

The hypothesis that vertically integrated firms have an incentive to foreclose the input market because foreclosure raises its downstream rivals' costs is the subject of much controversy in the theoretical industrial organization literature. A powerful argument against this hypothesis is that, absent commitment, such foreclosure cannot occur in Nash equilibrium. The laboratory data reported in this paper provide experimental evidence in favor of the hypothesis. Markets with a vertically integrated firm are significantly less competitive than those where firms are separate. While the experimental results violate the standard equilibrium notion, they are consistent with the quantal‐response generalization of Nash equilibrium.     

Assessment Ratios and Property Tax Burdens in Norfolk,Virginia, 1974–75*

To examine the relationship between property taxes and neighborhood housing, this paper employed property tax assessment to sale price ratios (i.e. effective tax rates) of residential properties sold during the period beginning July 1, 1974 through June 30, 1975. The analysis was designed to question whether or not the property tax in Norfolk results in different tax burdens for neighborhoods with different income levels. The results indicate there are substantial variations in effective tax rates within neighborhoods as well as between neighborhoods. More interesting is the fact that the property tax appeared to be progressive, given the measure used. If inequities in administration did not exist, it would be much more progressive. Such relationships indicate the existence of problems with the administration of the property tax in Norfolk. An examination of possible problems is conducted and some recommendations are made for potential corrective measures.     

Mixed signals: A dynamic analysis of warranty provision in the automotive industry, 1960–2008

Often, signaling research in the strategy and economics literature postulates the existence of an ostensible signal and then empirically tests its veracity, utilizing cross‐sectional data. We argue that this static approach does not allow researchers to fully incorporate the concept of equilibrium in their analysis, thereby potentially violating a key axiom of signaling theory. We propose that a dynamic analysis of signals can address this omission, and then conduct such an analysis. We use empirical data on warranty coverage offered by automobile manufacturers in the U.S. market extending from the first warranty offered by the industry in 1960 through to 2008. Our findings support the notion that signaling behavior differs in periods of equilibrium and disequilibrium, in turn influencing signal accuracy. Copyright © 2013 John Wiley & Sons, Ltd.     

Race,Compensation and Contract Length in the NBA: 2001–2002*

We study race and pay in the NBA for 2001–2002. For players who were neither free agents nor on rookie scale contracts, there were large, statistically significant ceteris paribus nonwhite shortfalls in salary, total compensation, and contract duration. But for players under the rookie salary scale (first‐round draft picks) and free agents, race effects were small and insignificant. These results suggest discrimination against marginal nonwhite players.     

ADVANCES IN LOGISTICS AND THE GROWTH OF INTRA‐FIRM TRADE: THE CASE OF CANADIAN AFFILIATES OF U.S. MULTINATIONALS, 1984–1995*

Intra‐firm trade in intermediates between U.S. multinational parents (MNCs) and their Canadian manufacturing affiliates increased dramatically in the 1984–1995 period (i.e., it roughly doubled). Tariff and transport cost declines were far too small to explain this phenomenon. But we show that the advent of improved logistics management practices, including the ‘just‐in‐time’ (JIT) production system, can explain much of the growth of intra‐firm trade. JIT lowers the inventory carrying cost component of intra‐firm trade, and, by 1984, this was more important than tariff and transport costs in many industries. We combine regression analysis with numerous case studies to draw our conclusions.     

THE ROLE OF DIFFERENTIATION STRATEGY IN LOCAL TELECOMMUNICATION ENTRY AND MARKET EVOLUTION: 1999–2002*

We examine the role of differentiation among competitive local exchange carriers (CLECs) in nearly 1,200 U.S. cities in 1999 and 2002, before and after a valuation crash affecting communications firms. We test and reject the null hypothesis of homogeneous competitors. We also find strong evidence that differentiated CLECs account for both potential market demand and the business strategies of competitors when making their entry decisions. Finally, product heterogeneity in markets in 1999 helps predict how the structure of markets evolved through 2002. We conclude that the policy debate for local telecommunications regulation should account for differentiated behavior.     

A FUZZY MODEL FOR R&D PROJECT SELECTION WITH BENEFIT,OUTCOME AND RESOURCE INTERACTIONS

A model of selecting a subset of a collection of indivisible projects is proposed which maximises the global Net Present Value. The Net Present Value of individual projects and the resource utilisation are given in the form of a fuzzy number. It is assumed that the fuzzy NPV of some projects may depend on the actual, crisp NPV of other projects and that the common realisation of certain couples of projects may allow some (fuzzy) savings in the resource utilisation. The decision-maker is supposed to have a rather pessimistic attitude. The proposed model takes on the form of a quadratic 0–1 programming problem.     

Explaining the Rent–OER Inflation Divergence, 1999–2007

U.S. Rent inflation has often greatly exceeded Owners' Equivalent Rent (OER) Inflation. Why? Critics believe that the Bureau of Labor Statistics is making a faulty utilities adjustment to OER and that the Federal Reserve Board should focus only on Rent inflation. Both beliefs are misguided. Herein we decompose the historical Rent–OER inflation differential into its various determinants. The utilities adjustment, which is necessary, sometimes contributed, but is no smoking gun. The main culprit was an economically interesting pattern of differential rent inflation across locales within cities, one common to many cities. Surprisingly, rent control also played a role.     

Engineering Occupational Choice, 1950–1965

This study has attempted to explain how the flow of engineers into the profession responded to market forces during the 1950–1965 period. The conventional explanation consists of two steps. The difference between the quantity supplied and the quantity demanded, at prevailing salaries, causes salary variation. Then, relative salary variations are supposed to cause supply variations. But in the case of the engineering labor market, while supplies vaned considerably, relative salaries did not. Consideration of the behavior of individuals has led us to believe that the second step of the conventional theory may be unnecessary. In a pervasively employment-conscious culture, variations in the availability of jobs seem to be a principal determinant af supply. This finding is actually quite consistent with economic theory which postulates supply as a function of expected earnings. It does suggest, however, that some consideration be given to changing the traditional emphasis from variations in earnings to variations in expectations.     

The Impact of Wage‐Setting Institutions on the Incidence of Public Employment in the OECD: 1960–1998

Using data on seventeen Organization for Economic Cooperation and Development (OECD) countries for 1960–1998, this paper studies the impact of unions on public employment incidence, using macro‐ and microdata. Macrodata show that greater coverage by centralized collective bargaining institutions raises the public employment share, controlling for country effects and country‐specific trends. Microdata show that this effect is more positive for outsiders: women, and younger and older men. Thus, government jobs may in effect partially counteract the employment problems these groups face in highly unionized societies.