Social Position and Behaviour: A Formalization

Modern society has witnessed anever-increasing development in the social sciences;partly due to changes in mentality, and partly due tothe growing requirements of the economic and political world – requirements which frequently takeon the guise of necessity, as for instance in thecases of market research and electoral opinion polls.Such development has produced an increasing paralleldemand for mathematical accuracy and exactitude inthese fields.The intention here is to rationalize the basic logicand methodology of the sociological procedure; anintention, it is hoped, which could be influential inimproving practical sociological work by rendering itmore comprehensible. This requires the employment offairly sophisticated mathematical and statisticalnotions.Section 1 outlines the definitions considered essential for the rationalization of the basiclogic framework previously described.Section 2 discusses the general concept of statisticalvariance. Section 3 introduces the notion of ``heterogeneity'and offers several propositions linked to this concept.Section 5 revolves around the notion of ``inaccuracy'.Section 6 presents a theorem relating to theimmersion of metric spaces in Banach spaces, andshows how the theorem can be used to constructtheoretically satisfactory immersion algorithms.Section 7 together with the material, which ispreviously introduced in Section 4, outlines thecluster analysis and the principal components methodologies.     

MIND THE GAP: UNEMPLOYMENT IN THE NEW EU REGIONS

Abstract.  The paper surveys the theoretical and empirical literature on regional unemployment during transition in Central and Eastern Europe. The focus is on optimal speed of transition (OST) models and on comparison of them with the neo-classical tradition. In the typical neo-classical models, spatial differences essentially arise as a consequence of supply side constraints and institutional rigidities. Slow-growth, high-unemployment regions are those with backward economic structures and constraints on factors mobility contribute to making differences persistent. However, such explanations leave the question unanswered of how unemployment differences arise in the first place. Economic transition provides an excellent testing ground to answer this question. Pre-figuring an empirical law, the OST literature finds that the high degree of labour turnover of high unemployment regions is associated with a high rate of industrial restructuring and, consequently, that low unemployment may be achieved by implementing transition more gradually. Moreover, international trade, foreign direct investment and various agglomeration factors help explain the success of capital cities compared to peripheral towns and rural areas in achieving low unemployment. The evidence of the empirical literature on supply side factors suggests that wage flexibility in Central and Eastern Europe is not lower than in other EU countries, while labour mobility seems to reinforce rather than change the spatial pattern of unemployment.     

Reaching nirvana with a defaultable asset?

We study the optimal dynamic portfolio exposure to predictable default risk, taking inspiration from the search for yield by means of defaultable assets observed before the 2007–2008 crisis and in its aftermath. Under no arbitrage, default risk is compensated by an ‘yield pickup’ that can strongly attract aggressive investors via an investment-horizon effect in their optimal non-myopic portfolios. We show it by stating the optimal dynamic portfolio problem of Kim and Omberg (Rev Financ Stud 9:141–161, 1996) for a defaultable risky asset and by rigorously proving the existence of nirvana-type solutions. We achieve such a contribution to the portfolio optimization literature by means of a careful, closed-form-yielding adaptation to our defaultable asset setting of the general convex duality approach of Kramkov and Schachermayer (Ann Appl Probab 9(3):904–950, 1999; Ann Appl Probab 13(4):1504–1516, 2003).     

Who bribes in public contracting and why: worldwide evidence from firms

We study procurement bribery utilizing survey data from 11,000 enterprises in 125 countries. About one-third of managers report that firms like theirs bribe to secure a public contract, paying about 8 % of the contract value. Econometric estimations suggest that national governance factors, such as democratic accountability, press freedom, and rule of law, are associated with lower bribery. Larger and foreign-owned firms are less likely to bribe than smaller domestic ones. But among bribers, foreign and domestic firms pay similar amounts. Multinational firms appear sensitive to reputational risks in their home countries, but partially adapt to their host country environments.     

Asymmetries and interdependencies in time use between Italian parents

In recent decades, changes in parents’ attitudes towards the importance of spending time with children to optimize their future behaviour and cognitive development have greatly affected patterns of time allocation among both working and nonworking parents in all developed countries. We compare the two waves of the Italian Time Use dataset (1988 and 2002) to analyse how family time allocation changed over time in a country that was undergoing a marked increase in female employment rate and a continuous decline in total fertility rate. We focus especially on how parents’ time with their children depends on their employment status and household characteristics. Using a simultaneous sequential approach, we consider links among the different time uses of individuals and correlations with spouses’ decisions. We find that wives’ time at work time strongly influences the time spent by both spouses with their children in 2002, but not in 1988. Fathers were much more involved in childcare and rearing in 2002 than in 1988. In general, as women's work time increased, substitutes for their childcare time were found within the household (fathers or other co-resident adults).     

SHIFTING BOUNDARIES IN ECONOMICS: THE INSTITUTIONAL COGNITIVE STRAND AND THE FUTURE OF INSTITUTIONAL ECONOMICS

This paper aims at contributing to the debate on the future of institutional economics and of the field as a whole by starting from the literature that discusses the relationship between Old‐Original Institutional Economics and New Institutional Economics. It suggests that the process of reunifying OIE and NIE (and evolutionary economics) prompted by part of the literature could be improved by the contribution of the Cognitive Institutional Economics. The paper follows a two‐stage pathway: first, it frames the debate on the relationships between NIE and the OIE and it concentrates on a subset of the literature that shows that NIE's recent developments complicate the distinction between NIE and OIE, and it explores the possibility that NIE and OIE may merge so that an amalgam of NIE, OIE and Evolutionary Economics becomes the next economic paradigm. Secondly, the paper argues that a step forward in the direction outlined by the literature has been made by CIE, which is a research stream that developed from cross‐fertilization among NIE, OIE and the Hayekian contributions to the analysis of institutions. In the concluding remarks, the possible emergence of a single institutional paradigm is discussed in the light of the literature about change in economics.     

Understanding the determinants of information technology adoption: evidence from Italian manufacturing firms

Our empirical study aims at identifying the determinants of Information Technology (IT) adoption by small and medium sized Italian manufacturing firms. An ordered probit analysis is conducted on a sample of about 17?000 firms surveyed by the Italian Statistical Institute, using as a dependent variable an index of IT adoption. Our results show that firm size, geographical location, functional composition of the workforce, R&;D activity, subcontracting, exports and collaboration between firms are all highly significant determinants of IT adoption. Such results are consistent with most of the predictions advanced in the few studies existing on this topic.     

Dynamically stable preferences

In the framework of dynamic choice under uncertainty, we define dynamic stability as a combination of two assumptions prevalent in the literature: dynamic consistency and the requirement that updated preferences have the same “structure” as ex ante ones. Dynamic stability also turns out to be a defining characteristic of the multiplier preferences of Hansen and Sargent (2001) [24] within the scope of variational preferences. Generally, for any class of invariant preferences, dynamic stability is shown to be connected to another independent property — consequentialism.     

Hayek and Keynes: From a common critique of economic method to different theories of expectations

The methodological positions of Hayek and Keynes contain striking similarities. Both authors opposed empiricist approaches to economics that assign priority to mere observation as the source of knowledge. Both emphasised intentionality, motivation and human agency. Notwithstanding this common ground, they had different conceptions of how beliefs are formed and had different explanations of thought and action in economics. Hayek grounded his explanation on an evolutionary theory of the mind, i.e. on psychological premises, whereas Keynes based his view of belief formation on probable reasoning, where probability is a logical concept. Starting from psychological premises Hayek maintained that individuals act rationally only by following rules. As a consequence, he considered conventional expectations to be the primary guide for agents in economic life. Keynes agreed that conventional expectations actually guide economic behaviour, but he maintained that they are justified only in situations of total ignorance. In conditions of limited knowledge, agents can base their action on reasonable expectations, independently of conventions. Moreover, agents?particularly those institutions responsible for economic policy?ought to shun conventional behaviour in order to counteract its negative social consequences. We argue that Keynes's theory of expectations is well grounded upon his theory of logical probability. Hence his advocacy of discretionary policy is rationally justified.