EXPORT SUBSIDIES VERSUS EXPORT QUOTAS WITH INCOMPLETELY INFORMED POLICY MAKERS*

This paper analyses export subsidies (price incentives) and export quotas (quantity controls) in the Brander‐Spencer (1985) model when policy makers have limited information on demand and cost structures. We examine necessary or sufficient information for policy makers to determine welfare‐enhancing policies. It is crucial that they know the elasticity value of the slope of the inverse demand curve and the market share. It is also shown that for policy makers, export quotas are superior to export subsidies under certain conditions.     

RISKY VERSUS RISKLESS BARGAINING PROCEDURES: THE AUMANN‐ROTH CONTROVERSY REVISITED*

In a series of papers, Aumann and Roth discussed a game in which players can cooperate in pairs and two of them prefer to form a coalition with each other. Roth argued that the only rational outcome is that the players who prefer each other form a coalition; Aumann argued that all three coalitions are possible because the players have a problem of expectation coordination. A non‐cooperative analysis provides additional support for Aumann's arguments and shows that the difference between Aumann's and Roth's views can be traced back to a difference (risky versus/riskless) in the bargaining procedure.     

LONG‐TERM AND SHORT‐TERM CONTRACT IN A MIXED MARKET*

With a two‐period mixed oligopolistic framework, this paper analyses the interaction between the length of incentive contracts and market behaviour. Assuming an environment in which firms choose either a long‐term or short‐term contract, we examine how contracts differ between public and private firms. The results show that the contracts would differ completely among firms; public firm prefers to make a short‐term contract while private firm makes a long‐term contract.     

SPILLOVER EFFECTS OF ECONOMIC INTEGRATION IN A THREE‐COUNTRY MODEL*

Using a simple monopoly model, we examine the effects of economic integration. We show that the number of markets and the shapes of marginal revenue curves, are crucial in evaluating economic integration when the marginal cost is not constant. The effects of tariff reductions in a three‐country model contrast with those found in a two‐country model. Effects also depend on which trade policy the non‐member country adopts. When both importing countries simultaneously lower their tariffs, the Metzler paradox may arise.     

TOWARD AN AUTONOMOUS HISTORY OF INDONESIA

The chronicles of pre-colonial Indonesia were influenced by Hindu legends and by the concept of divine kingship and the cyclical view of history both of which stemmed from Hindu Philosophy. It was not until the late eighteenth century that the Europeans initiated scientific studies of Indonesian history. By the end of the nineteenth century these studies had evolved into what might be called Dutch colonial history with its primary interest in the expansion of Dutch power in Indonesia. Indonesian nationalists have subsequently tried to revive their own history. Although the idea of “Indonesia-centric” history was advocated after independence, the writing of history for political purposes is being replaced by more substantial studies in each field of history.     

RESOURCE FLOW BETWEEN AGRICULTURE AND INDUSTRY —The Chinese Experience*—

The author has previously been engaged in a series of comparative studies on the role of the agricultural sector among the developing countries, being in doubt about the validity of the generally recognized view that in those countries much of the capital for industrialization has been supplied from this sector. For the purpose of re-examining this view, in this article the author analyses the resource outflow-inflow position of the agricultural sector in the Chinese economy and presents a grave question: Can the agricultural sector provide sufficient capital for industrial development in developing countries?