Optimal production of transplant care services

Most organ transplants are from dead donors. National transplant organizations exhibit considerable differences in terms of their donor population rates. Spain's organization is by far the most efficient in this respect. We argue that much of the productivity advantage of Spain's transplant organization proceeds from an efficient organization of the production chain, from organ procurement to transplantation. Transplants from dead donors are analogous to a common resource for the transplant community. Their circulation through the national transplant organization creates public good externalities between the care units in charge of organ retrieval and those in charge of transplantation. A socially efficient production of transplant care services obtains through an optimal control, by the national transplant agency, of both the circulation and the production of transplants. In particular, transplant shortage makes the rotten kid theorem fail in this context. The analysis also produces a natural measure of public good externalities, evaluated from the standpoint of care units.     

Stock Returns,Productivity, and Corruption in Eight European Fast-Emerging Markets

This article addresses the impact of productivity, corruption, and trade openness on the stock returns of 265 industrial companies listed in eight Eastern European fast-emerging markets, over the 2004-2013 period. Through a three-factor model that includes both measures at firm level and macro-level control variables, our findings suggest that country corruption index is negatively correlated with the total annual return of the stocks of the listed industrial companies of our sample. Moreover, the most productive firms are featured by higher stock returns, while leverage seems not to be a key predictor of stock returns. In addition, the article uncovers innovative evidence about trade openness that is negatively correlated with stock returns due to its connection with the recent financial crisis. That is, firms operating in markets that are more open to trade show a higher degree of interconnection with other economies and are more likely to undergo the effects of negative fluctuations from foreign markets during the economic crisis. © 2015 Wiley Periodicals, Inc.     

Glück — Die Sicht der Ökonomie

Glück führte lange Zeit ein Schattendasein in der ?konomischen Forschung. Das hat sich seit einigen Jahren ge?ndert. Aus den neuen Erkenntnissen zu den wirtschaftlichen und au?erwirtschaftlichen Bestimmungsgründen des Glücks werden auch Empfehlungen für eine Wirtschaftspolitik abgeleitet, die das pers?nliche und gesellschaftliche Glück der Menschen berücksichtigt. Bruno S. Frey und Claudia Frey Marti fassen in diesem Beitrag ihr Buch¹ zu dem Thema zusammen.     

Tariff equivalents of nontariff measures: the case of European horticultural and fish imports from African countries

In the context of the Partnership Agreements between the European Union (EU) and the African, Caribbean, and Pacific countries, this study estimates ad valorem tariff equivalents of European food safety standards on imports of key horticultural and fish products from Kenya, Tanzania, Uganda, and Zambia. The study uses an extension of the price‐wedge method to account for imperfect substitution and factor endowment in monopolistic competition. The estimated tariff equivalents are 55% and 98% for imports of fresh peas from Zambia to the Netherlands and the U.K., respectively. They range from 39% to 64% for imports of green beans and avocados from Kenya and from 63% to 270% for imports of frozen fish fillets in EU countries from the East African Community. We also observe large variations in tariff equivalents for the horticultural and fish products over time and EU importing countries.     

Smuggling and Bhagwati's Nonequivalence Between Tariffs and Quotas

The authors extend Professor Bhagwati's analysis about the nonequivalence between trade policy instruments when domestic production is monopolized and the terms of trade are endogenous, by allowing for smuggling. They show that the dominance of the ad valorem tariff over the quota is not robust. Tariffication can lower welfare even when the level of illegal imports is quite small. However, tariffication with a specific tariff is always beneficial because the specific tariff dominates the ad valorem tariff and the quota with or without smuggling. Smuggling (or the threat) also tends to lower the second–best tariff/quota, and increases welfare when imports are restricted by a quota, but lowers it under a tariff.     

Income distribution and the neoclassical paradigm: Introduction to a symposium

A simple graphical analysis is presented, for dissection of the growth and distributional responses of a one-sector neoclassical model. How the one-sector model fits in with the somewhat more elaborate models discussed in the subsequent symposium is also pointed out, to shed light on their properties.     

Resale price maintenance and collusion

The article revisits the conventional wisdom according to which vertical restrictions on retail prices help upstream firms to collude. We analyze the scope for collusion with and without resale price maintenance (RPM) when retailers observe local shocks on demand or retail costs. In the absence of RPM, retail prices react to retailers' information, and deviations from collusive behavior are thus difficult to detect. By eliminating retail price flexibility, RPM facilitates the detection of deviations but reduces profits and thus increases the short‐run gains from a deviation. Overall, RPM can facilitate collusion and reduce total welfare when firms adopt it.     

Labour disputes,investment decisions and the judiciary

In this article, we show that the presence of the judiciary in the background of labour relationships is not neutral within these relations: its potential intervention in case of an ex-post layoff and conflict over the severance payment can promote ex-ante efficient specific investment decisions. This ability to promote efficiency depends on the judiciary's aptitude to balance out the parties' ex-post bargaining powers. Interestingly one of the results shows that, if workers' bargaining power in wage negotiations is low, which implies that they expect low returns from continuing the relationships, an increase in the exogenous layoff probability should lead judges to be less lenient towards them.     

Fiscal Balance and Current Account in Professional Forecasts

This paper investigates the relationship between financial institutions' expectations of the current account and the fiscal balance. Using professional macroeconomic forecasts for the G‐7 countries, we find a positive relationship between forecasts of the cyclically adjusted fiscal balance deficit and forecasts of the current account deficit, indicating that professional forecasts embody links implied by the twin deficits hypothesis. In assessing the relationship between the forecasts of the fiscal deficit and the current account, we find that forecasters correctly make the distinction between the effect of fiscal policy and automatic stabilizers.