Segmented Labour Markets: Theory and Evidence

This paper examines the possibility of accepting the labour market segmentation approach as a valid alternative to the classical and neo-classical analysis of labour markets. It consists of three main parts. The first part contains a historical analysis of both the distant and recent origins of the labour market segmentation hypothesis. Part two outlines the central ideas of both segmentationalists and radical theorists who attempted to explain the fragmented nature of labour markets and the importance of institutional and social influences upon pay, employment and mobility of individual workers between different labour market sectors. The third part examines the case for labour market segmentation using four alternative techniques and discusses the issue of mobility among different labour market segments. It is thereby concluded that the lack of agreement among the segmented labour market theorists on both theoretical and methodological issues has prevented them from developing a consistent and convincing argument based on verifiable empirical evidence to validate their thesis.     

A Theory of Fraud and Overtreatment in Experts Markets

Consumers often rely on an expert's diagnosis to assess their needs. If the expert is also the seller of services, he may use his informational advantage to induce overtreatment, which is a pervasive phenomenon in experts markets. We offer and discuss conditions leading to equilibrium overtreatment in an otherwise purely competitive model. This market failure results from consumers' ability to turn down an expert's recommendation: experts defraud consumers to keep them uninformed, as this deters them from seeking a better price elsewhere.     

A Reality Check for Game Theory

Book reviewed
Colin F. Camerer (2003). Behavioral Game Theory: Experiments in Strategic Interaction     

新股发行定价:理论与现实

本文以西方相关理论为依据，分析了我国目前新股发行定价过程中的特点及问题，指出现阶段竞价发行并非最好的选择。应采取必要的限价措施，在恢复向二级市场投资者配售新股的同时，完善发行方式，集中配售，分步上市。     

Markets, Materialism and Messages

Lord Harris's critical review of the Bishop of Durham's book 'God, Politics and the Future', in the February/March issue of Economic Affairs, inspired the following reply from the author. Readers must fudge for themselves.     

Selection,Heterogeneity, and Entry in Professional Markets

We analyze two different cases of entry regulation in professional markets: first, when licensing is a requirement for becoming a professional (lawyers); second, when entry and price restrictions are applied on a geographical basis (pharmacists). Both cases are investigated within a circular model of localized competition and heterogeneous players. The analysis reveals that licensing introduces a selection mechanism which is effective in preventing entry of inefficient players in markets with large ex ante heterogeneity. Furthermore, because in the second case excessive entry is reduced as the degree of heterogeneity increases, our analysis lends support to a policy that simultaneously relaxes entry and price restrictions.     

Efficient Markets, Fundamentals, and Crashes

A bstract .Economists have struggled to characterize and model the dynamic evolution of economic phenomena throughout this century. For at least eight decades, American economists have faced the persistent choice between structural or formal models of evolving dynamics and those alternative portrayals that focused on historical narratives or qualitative features. In this article we compare the models and methods used by representative authors who have sought to address the swings in stock prices. Our rather terse comparison between the orthodox theorists and those we label heterodox demonstrates the wide divergence between the foci of approaches adopted. Their methods, conclusions, and implications differ markedly. Where the orthodox approaches focus all but exclusively on statistical issues, the heterodox group stresses the importance of incomplete information and markets in an institutional and historical context. Such fundamental differences prohibit any meaningful dialogue between proponents of the two basic approaches. Moreover, substantial deficiencies–technical and otherwise–of contributions within the two groups limit ability to discriminate between rival views within each group. The clearer identification of transparent roles for credit, technology, and institutions in the heterodox approaches, however, makes the awkward translation from theoretical model to social commentary much easier.     

Emerging Markets, Unemployment and Inflation

World inflation is being held down by emerging market competition interacting with continuing OECD monetary policy. Here at home, fast productivity growth makes the UK something of an emerging market within Europe.     

Searle, Rationality, and Social Reality

A BSTRACT . This paper makes a critical assessment of some contributions of John Searle of direct relevance to social science—his theory of rationality and his theory of institutions. The former is criticized for being able to account for how people can act for "external reasons," as opposed to their desires, only in cases where an obligation derives from a promise; a rival account is much more general. The latter is criticized on three grounds: (1) his theory of institutions can only account for a narrow range of social reality, that deriving from some kind of "enactment"; (2) his notion of "collective intentionality" is unnecessary to explain institutions and is introduced only so that Searle can stay within an individualistic, Cartesian theory of the mind, something of no interest to social scientists; (3) his account implies that if an institution exists, "we collectively accept it," whereas it may in fact not be accepted, but merely tolerated or submitted to.     

内部资本市场理论综述

内部资本市场理论是研究企业内部资金配置的重要理论之一。在回顾中外学者们的内部资本市场理论的基础上,阐述了内部资本市场产生的实践基础和理论基础,归纳了内部资本市场的定义,列出内部资本市场在配置资源中的优势与劣势,并对内部资本市场的边界进行了分析。     

Collective Acceptance, Social Institutions, and Social Reality

ABSTRACT . The paper presents an account of social institutions on the basis of collective acceptance. Basically, collective acceptance by some members of a group involves the members’ collectively coming to hold and holding a relevant social attitude (a “we‐attitude”), viz. either one in the intention family of concepts or one in the belief family. In standard cases the collective acceptance must be in the “we‐mode,” viz. performed as a group member, and involve that it be meant for the group. The participants must be collectively committed to what they have accepted. Social institutions are taken to be norm‐governed social practices introducing a new social and conceptual status on the practices or some elements involved in those practices. This requires that some of the involved norms be constitutive norms as opposed to merely “accidentally” regulating ones. A classification of social institutions is presented. The account is broader in scope than is Searle’s.     

Quality Competition, Insurance, and Consumer Choice in Health Care Markets

In this model, insurance offering a choice of hospitals is valued because consumers are uncertain which hospital they will prefer ex post. A competitive insurance market facilitates tacit price collusion between hospitals; high margins induce hospitals to compete for customers through overinvestment in quality. Incentives may exist to lock in market share via managed-care plans with less choice and lower prices. As technology becomes more expensive, the market increasingly offers too little choice. A pure managed care market may emerge, with underinvestment in quality. Relative to a pure insurance regime, however, all consumers are better off under managed care.     

Corporate Governance,Investment, and Firm Valuation in Asian Emerging Markets

We investigate the effects of corporate governance and family ownership on firm valuation through investment efficiency in Asian emerging markets. Using 3 years of time series data from the Credit Lyonnais Securities Asia corporate governance score for 10 Asian emerging markets, we find that good corporate governance leads to better or more efficient investment decisions and eventually to higher firm value. We also find that investors reward firms for improvement in corporate governance. The findings do not hold for Asian firms with a family or concentrated ownership structure. The results are not driven by changes in accounting standards in these markets.     

European Periphery Crises,International Financial Markets,and Democracy

This article analyzes the origin and causes of the recent economic and financial crises, mainly for the countries located in the periphery of the European Union (EU), as well as their evolution and transformation into social, political, and institutional crises. After explaining the differential impact of the crises on EU economies, we analyze how the economic policies developed thus far not only are unable to resolve the current crisis pattern but also actually entail a risk to the present democratic models by transferring the legitimate control over governments from citizens and democratic parliaments to unelected, nonrepresentative international financial markets.     

Internal Markets,Management by Targets,and Quasi‐Markets: An Analysis of Health Care Reforms in the English NHS

There have been two major attempts to introduce market mechanisms into England's National Health Service: the ‘internal market’ reform project of the 1990s, and the ‘quasi‐market’ of the 2000s. Despite their similarities, the former attempt was on balance unsuccessful while the latter succeeded. This article examines and compares the outcomes of the two periods, analysing the reasons for their relative successes and failures. It goes on to highlight options for future reforms that would build on those achievements.