Debt Relief and Economic Growth in Mexico

Could external restraint and internal balance in Mexico havebeen reconciled at levels of savings and investment that allowedsatisfactory growth in output without the 1989–90 restructuringof debt? What are the likely implications of Mexico's "Bradydeal" on economic growth? What are the macroeconomic effectsof debt-equity swaps? This article develops and estimates amodel to address these issues. The analysis concludes that the1989–90 agreement in Mexico will contribute materiallyto macroeconomic stability and the restoration of economic growth.     

The Ju/'hoan Bushman Development Foundation and basic needs in eastern Bushmanland,Namibia

The Ju/'hoan Bushman Development Foundation (JBDF) is a multi‐dimensional development foundation which has as its main objective the raising of the standard of living of the indigenous Ju/'hoan Bushmen in eastern Bushmanland, Namibia. It has a basic needs approach to development.

The development activities of the Foundation started in 1981. The Nyae Nyae Farmers’ Cooperative, through which the Foundation now directs its development activities, was established in 1986. It is funded by various international development agencies, such as Christian Aid, NORAD, SIDA, Bread for the World, Oxfam Canada, and the EEC.

The basic needs approach of the Foundation addresses the following dimensions: water, food, cash, clothing, health, literacy and education, community esteem, and problems and propositions.     

The role of extension in the development of the farmer as entrepreneur

Different viewpoints were expressed at the 1990 annual national conference of the South African Society for Agricultural Extension regarding the role of extension in the development of the farmer as entrepreneur. It is expected that public funding will increasingly be limited to functions of general public interest. To achieve independence farmers should be willing to expose themselves to entrepreneur development stimuli. it is in the public interest to develop scarce human, economic and natural resources. Research findings indicate distinct behavioral differences between entrepreneurs of differing perceptions. A comprehensive interdisciplinary education is recommended for agriculturalists. Because needs change, education programmes must be re‐evaluated from time to time. It serves little purpose to educate people in extension who do not have a technical message to communicate. The state extension service seeks closer cooperation and liaison with agricultural co‐operative and private sector know‐how. Departmental policy will probably be less rigid in future.

A clear distinction should be made between information and extension services. The adoption of an ethical code for extensionists may be opportune. Relevancy is an important contributing factor to extensionist credibility.     

Inflation, investment and economic performance: The role of internal financing

This paper studies a link between inflation and economic activity that is built on two hypotheses. First, firms mitigate informational frictions in financial markets by accumulating retained earnings over a period of time. Second, firms allocate earnings among three competing uses - dividends, current investment, and the accumulation of internal funds - and inflation directly distorts this allocation decision as well as the real value of accumulated internal funds. The model predicts that the level of inflation - both unanticipated and expected inflation - as well as the variability of inflation distort firms’ internal financing decisions, increases frictions in financial markets, reduces the level and efficiency of investment, and reduces aggregate output. The marginal effects of inflation are increasing in the inflation rate.     

Regulating an Externality-Generating Utility Environmental Taxes Under Limited Information

Global warming is currently an important item on most nationalenvironmental agendas. In many countries, coal-fired electricity generatingstations represent an important source of greenhouse gases. We examinehow regulations to curb emissions affect public utility pricing regulationwhen regulators act non-cooperatively. We show that, when there is limitedinformation on fixed abatement costs, an environmental regulator prefersan emission tax over an output tax or a lump sum environmental tax. Thepublic utility regulator prefers the lump sum tax regime.     

Structural Decomposition Analysis of Physical Flows in the Economy

Many environmental problems can be attributedto the extraction and emissions of physicalsubstances. Increasing our understanding of theeconomic and technological driving forcesbehind these physical flows can contribute tosolving the environmental problems related tothem. The input-output framework is a usefulsetting in which to integrate detailedinformation about economic structure andphysical flows. In this article a specificmethod in input-output analysis is reviewed,namely Structural Decomposition Analysis (SDA).It is based on comparative static analysis,which decomposes historical changes of a policyvariable into determinant effects. SDA has beenapplied, for example, to analyze the demand andtechnological driving forces of energy use,CO₂-emissions and various other pollutantsand resources. This article examines thetheoretical aspects of structuraldecomposition, in particular those concerningphysical flows and environmental issues.Furthermore, the article includes an extensivesurvey of empirical studies.     

Cost Structures and Nash Play in Repeated Cournot Games

This paper reports an experiment designed to assess the effects of a rotation in the marginal cost curve on convergence in a repeated Cournot triopoly. Increasing the cost curve's slope both reduces the serially-undominated set to the Nash prediction, and increases the peakedness of earnings. We observe higher rates of Nash equilibrium play in the design with the steeper marginal cost schedule, but only when participants are also rematched after each decision. Examination of response patterns suggests that the treatment with a steeper marginal cost curve and with a re-matching of participants across periods induces the selection of Nash Consistent responses.     

Discriminatory Price Auctions in Electricity Markets: Low Volatility at the Expense of High Price Levels

A pay-as-offered or discriminatory price auction (DPA) has been proposed to solve the problem of inflated and volatile wholesale electricity prices. Using the experimental method we compare the DPA with a uniform price auction (UPA), strictly controlling for unilateral market power. We find that a DPA indeed substantially reduces price volatility. However, in a no market power design, prices in a DPA converge to the high prices of a uniform price auction with structural market power. That is, the DPA in a no market power environment is as anti-competitive as a UPA with structurally introduced market power.     

Does the dutch model really exist?

The policy that led from the "Dutch disease" (in the 1980s) to the "Dutch miracle" (in the 1990s) consists of three tracks: wage moderation, retrenching public expenditure and reducing the tax burden, and slimming the welfare system. The wage moderation track seems to have been the most important. The term "Dutch model" refers to the socioeconomic system of the Netherlands. Most observers point particularly to the relatively low unemployment rate to indicate the success of this model. However, the economic inactivity rate in the Netherlands is not lower than in neighboring countries. This suggests that open unemployment in the Netherlands has been partly replaced with hidden unemployment. In particular, the disability scheme seems to contain a large component of hidden unemployment. Another feature of the Dutch model is its consensus-seeking nature, which is fostered by its institutional structure.