Public Sector Employment and the Skill Premium: Sweden versus the United States 1970–2012

Swedish census data and tax records reveal an astonishing decline in the aggregate skill premium of 30 percent between 1970 and 1990, with only a modest recovery in the next couple of decades. In contrast, the US skill premium rose by around 24 percent over those four decades. A theory that equalizes wages with marginal products can rationalize these disparate outcomes when we replace commonly used measures of total labor supplies by private sector employment. The dramatic decline in the skill premium in Sweden is the result of an expanding public sector that has disproportionately hired unskilled labor.     

The Political Economy of the Global Environment

Issues of the ‘global commons’ have secured a prominent place in environmental discourse. The temperature-regulating functions of the global atmosphere and radiation control functions of stratospheric ozone offer clear examples of true public goods. Other environmental assets, such as biodiversity and forests, are treated as if they are public goods, but in reality are complex mixtures of private goods, local public goods and global public goods. The approach to the provision and protection of these goods has tended to focus on the development of international agreements, such as those at the Rio de Janeiro ‘Earth Summit’ in 1992. But do these agreements contain the relevant incentives to conserve the global commons? Much depends on one's view of human nature. The Scottish economic tradition suggests that unless incentives focus on ‘self love’, as postulated by Hume and Smith, improvements will, at best, be marginal. A richer array of policy measures is obtained by analysing the potential for ‘global bargains’, trades that improve the environment whilst making each party better off. The souls of Hume and Smith surely approve recent developments in practical global bargains.     

Stock returns and economic activity: the UK case

This paper investigates the relationships between real stock returns and a number of financial and economic variables for the UK economy for the period 1980 to 1994. We begin by discussing a theoretical model proposed by Balvers et al. and then re-estimate for the UK what may be regarded as an application of that model by Fama applied to the US market. This reproduces Fama's main results. For the UK we than suggest a slightly, different application of the Balvers model, the most important feature of which is the use of expectational macro-economic variables instead of Fama's use of leading values of industrial production. We then go on to investigate the unit root properties of the data and show that much of the data is indeed characterized by the presence of unit root non stationarity In the light of this, we propose an application of the Phillips-Loretan error-correction model and show that this provides a plausible relationship between real stock returns and most of the financial and economic variables.     

Using Industry-Sponsored Game Nights to Educate About Risk and Insurance

As educators in the field of risk management and insurance, we see know- ledge of risk management and insurance as a core business function. However, some colleagues and students see insurance as cold-call sales or companies with a lot of money that continue to raise their prices. So we have to find ways to make our public aware of the usefulness of risk management and insurance in the business world and in private life and of the opportunities that having such knowledge presents to all business majors and business people. One method that is beginning to show dramatic improvements in at least our students' perceptions of the field and the major involves industry-sponsored game nights. While not an academic endeavor nor strictly risk management education, we believe the idea provides a useful tool for opening students' eyes to the need for knowledge of risk management and insurance and of the opportunities that are available in the insurance industry and its related fields. This article discusses the history of such an event at Appalachian State Univer- sity, the current status of the North Carolina Surplus Lines Association (NCSLA) event, and the benefits of the event.     

Developing holistic leaders: Four domains for leadership development and practice

Leadership development and practice have traditionally been quite narrow, with a decided focus on the analytical realm of leadership. However, the contemporary climate of corporate scandal and resultant loss of societal confidence, coupled with the evolving demands, needs, and expectations of employees, point to the potential need for a more holistic approach to leadership. Thus, this article proposes how management education and leadership development programs can develop holistic leaders that are adept at operating in the analytical, conceptual, emotional, and spiritual domains of leadership practice. An integrated model for holistic leadership development and practice that addresses all four of these domains is proposed, and grounded in both established and emerging leadership development theory. Additionally, a leadership development classification scheme is proposed based on classroom, job, and organizational contexts.     

The Role of Information and Influence in Social Networks

A bstract .   This article examines two mechanisms through which social networks are related to job mobility: (1) access to diverse sources of information about job openings and (2) nonredundant sources of influence. Using data on job changing and social networks among television station managers, we assess the extent to which job information and influence variables mediate the relationship between social network structure and getting a better job. Results indicate that there is an association between job mobility and having nonredundant contacts, but our measures of the information and influence mechanisms are not significant mediators. We conclude by reexamining the network-resource model that forms the basis for much of the research on the relationship between social networks and job mobility.     

Innovation and knowledge-intensive business service: the contribution of knowledge-intensive business service to innovation in manufacturing establishments

It is well established that knowledge-intensive business service (KIBS) firms can be innovators in their own right. It is also well established that KIBS can contribute to innovation in their client firms. This role of KIBS has been theorised, and some of the processes by which KIBS contribute to innovation have been scrutinised by way of case studies. However, there are few, if any, large-scale analyses that permit the two following questions to be addressed: (i) Do firms that use KIBS systematically introduce more innovations than those that do not? (ii) Is recourse to certain types of KIBS associated with certain types of innovation? Our survey of KIBS use across 804 manufacturing establishments in Quebec shows that KIBS contribute to their client's innovation – thereby confirming in a more general way what has been observed in case studies – but also that different types of KIBS contribute to different types of innovation.     

Bank incentives, contract design and bank runs

We study the Diamond-Dybvig [Bank runs, deposit insurance, and liquidity, J. Polit. Econ. 91 (1983) 401-419] model as developed in Green and Lin [Implementing efficient allocations in a model of financial intermediation, J. Econ. Theory 109 (2003) 1-23] and Peck and Shell [Equilibrium bank runs, J. Polit. Econ. 111 (2003) 103-123]. We dispense with the notion of a bank as a coalition of depositors. Instead, our bank is a self-interested agent with a technological advantage in record-keeping. We examine the implications of the resulting agency problem for the design of bank contracts and the possibility of bank-run equilibria. For a special case, we discover that the agency problem may or may not simplify the qualitative structure of bank liabilities. We also find that the uniqueness result in Green and Lin [Implementing efficient allocations in a model of financial intermediation, J. Econ. Theory 109 (2003) 1-23] is robust to our form of agency, but that the non-uniqueness result in Peck and Shell [Equilibrium bank runs, J. Polit. Econ. 111 (2003) 103-123] is not.