Why poor people get rich: Kenya 1960–1979

This paper challenges the conventional model underlying much thinking on Kenya which has stressed the extant inequality of assets (including human capital) and the presumed weakness of intersectoral links owing to structural rigidities in the system. On the basis of recent survey data, the authors test their hypothesis that the pattern of growth and distribution in the Kenyan smallholder sector is best understood rather as being the outcome of the complex interaction of rural factor market failure and urban labour market participation. The sources of growth may be distinguished as improved resource allocation, capital formation and innovation, so that the transmission mechanisms from factor market malfunctioning and urban employment onto growth and distribution must be via these three components. The arguments which follow question the orthodox views on such phenomena as urban bias, trickle-down growth, the functions of urban-rural remittances, and the need for land reform.     

On economic causes of civil war

We investigate whether civil wars have economic causes. Themodel is based on utility theory, rebels will conduct a civilwar if the perceived benefits outweigh the costs of rebellion.Using probit and tobit models the propositions are tested empirically.Four variables, initial income, ethno-linguistic fractionalisation,the amount of natural resources, and initial population sizeare significant and strong determinants of the duration andthe probability of civil wars. One important finding is thatthe relationship between civil wars and ethnic diversity isnon-monotoniq highly fractionalised societies have no greaterrisk of experiencing a civil war than homogenous ones.     

A validated expert system for decision making in corporate recovery

This paper describes INSOLVE—an expert system for corporate recovery decisions. INSOLVE was built to understand the decision-making processes of corporate recovery experts who deal with companies in financial difficulties. INSOLVE has been developed using a multi-phase process similar to that widely adopted in software engineering. The expert system is described in terms of the assessment task and interpretation models of CommonKADS. The detailed results of the validation of INSOLVE with 17 experts show that it is an accurate model of human expertise in this domain. Copyright © 1999 John Wiley & Sons, Ltd.     

Institutional arrangements in educational systems and student achievement: a cross-national analysis

Given the lack of evidence supporting the view that variation in observable educational inputs affect student achievement, many policymakers and researchers have tried to unearth the salient determinants of student learning. To that end, several recent studies have made use of international data on student achievement to assess the role played by institutional arrangements within the educational system. We revisit this literature using the 1999 TIMSS data—covering over 100,000 students from 22 countries—to analyze the association between different institutional arrangements and the distributions of science and math test scores. The results yield a number of interesting conclusions, as well as highlight the gains to analyzing student achievement within a distributional framework.     

Governance in the Participative Organisation: Freedom, Creativity and Ethics

Organizations in changing environments need to become flexible, responsive and participative. We develop an understanding of governance in these organizations by drawing analogies between organization theory and theories of non-linear dynamics. We identify freedom and creativity as driving principles in 'chaotic' participative organizations, and explore the ethics of their exercise within organizational communities of practice, communities of discernment and communities of commitment.     

Audit committee activity and agency costs

Menon and Williams indicate that many United States (US) over-the-counter (OTC) firms which form audit committees appear not to rely on them (cf. Menon, K., Williams, J.D. 1994. Journal of Accounting and Public Policy, 13(2), 121–139). Reliance on audit committees appears to depend upon board composition, while audit committee activity is associated with firm size. In this paper, we compare the US experience and evidence on audit committees and monitoring with the position in the United Kingdom (UK), where there has been a steady growth in the number of major companies voluntarily forming audit committees over the last 15 years (Collier, P.A. 1996. Accounting, Business and Financial History 6(2), 121–140). We contend that the dataset is best analyzed using the Heckman procedure (cf. Heckman, J.A. 1979. Econometrica 47(1), 153–161) which captures the two stages of the decision on audit committee activity.Our results show little support from the UK data for the findings of Menon and Williams (cf. Menon and Williams, 1994. Journal of Accounting and Public Policy 13(2), 121–139). However, consistent with their agency theoretic perspective of monitoring, we found that high quality (Big Six) auditors, and to some degree leverage have a positive relationship with audit committee activity. Contrary to an agency theoretic expectation, we found that audit committee activity is reduced in firms that combine the role of chairman and chief executive. On the basis of this result we explored the impact of insiders (executive directors) and found that their presence on an audit committee had a significant negative impact on audit committee activity. This result suggests that the emphasis placed by the US Securities and Exchange Commission (SEC) (Staff Report on Corporate Accountability, US Government Printing Office, Washington, DC, 1980, p. 491) and the Cadbury Committee (Committee on the Financial Aspects of Corporate Governance. 1992. Report of the Committee on the Financial Aspects of Corporate Governance. Gee, London) on the independence of audit committee members may be well founded.The reduction in audit committee activity that arises from the combination of the role of chairman and chief executive officer, and the presence of insiders on the audit committee, has important policy implications. Indeed, in the UK, both practices are the subject of recommendations in the Hampel Committee report Hampel Committee 1998. Committee on Corporate Governance. Gee, London.