The Tragedy of the Commons and Inflation Bias in the Euro Area

Central bank credit has expanded dramatically in some of the Euro Area member countries since the beginning of the financial crisis. This paper makes two contributions to understand this stylized fact. First, we discuss a simple model of monetary policy that includes (i) a credit channel and (ii) a common pool problem in a monetary union. We illustrate that the interaction of the two elements leads to an inflation bias that is independent of the standard time-inconsistency bias. Secondly, we present an institutional analysis that is consistent with the view of fragmented monetary policy and empirical evidence that illustrates the heterogeneity of central bank credit expansion.     

Contingent trade policy and economic efficiency

Review of World Economics - This paper models the competition for a domestic market between one domestic and one foreign firm as a pricing game under incomplete cost information. As the foreign...     

Multi-agent modeling of economic innovation dynamics and its implications for analyzing emission impacts

In this elaboration we focus on the role of multi-agent systems as a tool for modeling economic dynamics. Hence, at the beginning the specific features of this tool are considered. Taking the example of explaining the relationship between innovations and economic growth it will be shown after that how the tool of multi-agent modeling can be used for the following purposes: (1) for explaining the occurrence of innovations, (2) for specifying the effects these innovations have on economic growth, (3) for linking emission impacts to this growth and finally (4) for exemplarily assessing political options to reduce these impacts.     

Internationalisation Processes,Networking and Local Embeddedness in Technology-Intensive Small Firms

The paper argues that technology-intensive small firms often need to internationalise their activities, and especially sales, at a very early stage of their development because of the limited and global nature of the technological market niche which they have been set up to exploit. From a survey of 100 such firms in the Cambridge and Oxford regions, it demonstrates that many technology-based smaller firms are engaged in a range of international networks and internationalisation processes, including internationalisation of markets, research collaboration, labour recruitment, ownership and facilities location. Technology-intensive firms reporting high levels of internationalisation also differ significantly from those which are more nationally-oriented, for example in terms of size, age, research intensity, university links, and innovativeness. There are also differences with respect to recent growth rates. Finally, the paper demonstrates that far from substituting international for local networks, technology-intensive firms which have achieved high levels of internationalisation in fact also exhibit above-average levels of local networking with respect to research collaboration and intra-industry links. Internationalisation therefore appears to be grounded or embedded in successful local networking and research and technology collaboration.     

Analysing tax evasion dynamics via the Ising model

We develop a model of tax evasion based on the Ising model. We augment the model using an appropriate enforcement mechanism that may allow policy makers to curb tax evasion. With a certain probability tax evaders are subject to an audit. If they get caught they behave honestly for a certain number of periods. Simulating the model for a range of parameter combinations, we show that tax evasion may be controlled effectively by using punishment as an enforcement mechanism.     

Financial comparability and environmental diversity: an international context

Accounting and environmental management both hold improved resource‐use efficiency as an ultimate goal, but intermediate processes and objectives vary and consequently it is separately assessed within each discipline. This paper intends to make visible the globalizing trends in accounting practice, which aim to standardize financial reporting to produce comparable information so that shareholders can maximize their economic wealth. This paper seeks to contrast this comparability strategy with the apparent need for diversity in accounting information exhibited by actual accounting practices, the information needs of environmental management and, ultimately, the cultural needs of sustainable development. We argue that a more pluralistic model, that enables a holistic assessment of corporate performance and balances diverse stakeholder objectives, is better suited to an uncertain future. Implementation requires accountants and environmental managers jointly to create and test a new order of reporting. There are many practical challenges but most significantly accountants and environmental managers must combine to enhance the visibility and credibility of these diverse performance measures. Copyright © 2002 John Wiley & Sons, Ltd. and ERP Environment