Inflation Targeting: What Can the ECB Learn From the Recent Experience of the Bank of England?

Establishment of the European Central Bank presents a rare opportunity to define the operations of a central bank without a prior track record. This paper asks what might be learnt from the recent experience of inflation targeting at the Bank of England before the ECB specifies an, as yet undefined, operational target. We consider whether there should be single or multiple targets and which inflation measure should be used, if at all. If inflation is targeted then a forecast of its value becomes the intermediate variable. This raises an issue of transparency and the compensating supply of information necessary to fill the gap, but too much 'openness' can also be problematic. The ECB must be accountable and the contracting approach may be useful although being seen to 'say' and 'do' the same thing is ultimately most important.     

Reviews

“THE POLL TAX” Flannery, Kate, 1987: More than Just a Poll Tax. Centre for Local Economic Strategies, £5.00. MacGregor, Susanne, 1988: The Poll Tax and the Enterprise Culture. Manchester: Centre for Local Economic Strategies, £3.95.

“ECONOMIC THEORY AND THE LOCAL ECONOMY” Smith, D., 1987: The Rise and Fall of Monetarism: The Theory and Politics of an Economic Experiment. Penguin, £3.95.

Holland, S., 1987: The Market Economy: From Micro to Mesoeconomics and The Global Economy: From Meso to Macroeconomics, Weidenfeld, £12.95 each.

Green, F. and Sutcliffe, B., 1987: The Profit System: The Economics of Capitalism. Penguin, £5.95.

“THE SERVICES REVOLUTION?” Rajan, A., 1987: Services: The Second Industrial Revolution? London: Butterworths, £27.50.

“ENVIRONMENT AND ECONOMY IN EUROPE” Joyce, F. E. and Schneider, G. (editors), 1988: Environment and Economic Development in the Regions of the European Community. Aldershot: Avebury/Gower, £18.50 hb.

“POLITICS OF PRIVATISATION” Ascher, K., 1987: The Politics of Privatisation: Contracting Out Public Services. London: Macmillan Education Ltd. £30.00 cloth, £8.95 paper.

“RECRUITMENT AND TRAINING POLICY” Davies, T. and Mason, C., 1986: Shutting out the Inner City Worker. University of Bristol, School for Advanced Urban Studies, £4.30.

Chapman, P. G. and Tooze, M. J., 1987: The Youth Training Scheme in the United Kingdom. Avebury: Gower Publishing Company, £22.50.

“JOB GENERATION RESEARCH” Storey, D. J. and Johnson, S., 1987: Job Generation and Labour Market Change. London: Macmillan.     

Industry Distributional Characteristics of Financial Ratios: An Acquisition Theory Application

This study explores the importance of capturing industry‐specific distributional characteristies in analyses based on financial ratios. As a test case, the study replicates Palepu (1986), who employs financial ratios in logit models to investigate the usefulness of six acquisition hypotheses in predicting takeover targets. Without adjustment for industry‐specific distributional characteristics, this study's findings are only consistent with one of the six acquisition hypotheses. After adjusting for distributional properties, the results are consistent with four of the six acquisition hypotheses. Furthermore, the adjusted model produces a classification accuracy significantly greater than chance, as well as significantly greater than that observed for the unadjusted model.     

Designing and rolling-out a global style in process innovation

This paper discusses a consultancy project for a large multinational-manufacturing client. Style is explored as a concept originatirg in 'cultural' rather than economic disciplines. Three interpretations of culture are explored which have differing, complementary implications for managing style in technology-related organizational learning. The overall intenlion is not to identity and install a global 'best' style or a universal model of IT-related organizational culture. Rather it is to develop heuristics, which highlight what may require attention and handling in a practical situation, within a dialopue-based and learning-oriented approach to global-local strategy in complex production systems.     

Social Exclusion—New Language, New Challenges for Local Authorities

National policy initiatives such as the establishment of the Social Exclusion Unit and the new government strategy, 'Opportunity for All', have provided a new stimulus to local authorities to develop more effective local strategies to promote social inclusion. The major features of current local initiatives are described, and the leadership and management challenges presented to local authorities are discussed. However, for local government to tackle social exclusion and poverty more effectively it is also necessary for the structural and regional dimensions of social exclusion to be taken more into account by central government, and for a new equilibrium between central, regional and local initiative to be achieved.     

Latecomer catch-up strategies in electronics: Samsung of Korea and ACER of Taiwan

Very little is known about the strategies by which East Asian firms acquired foreign technology and managed to ‘catch up’ in electronics. Unlike Western and Japanese innovation ‘leaders’ and ‘followers’, East Asian firms are ‘latecomers’, dislocated from advanced markets, demanding buyers and international sources of technology. This work examines the cases of two leading latecomers - Samsung Electronics of Korea and ACER of Taiwan - to generate insights into how electronics manufacturers overcame barriers to entry and became strong competitors on the world stage. The aim is to highlight the sources, paths and mechanisms of learning in the two firms, relating these patterns to corporate strategy, organization and performance. This contribution argues that latecomers reversed the traditional research and development centred pattern of innovation, travelling backwards along the product life cycle, from mature to early stages. A simple model is put forward to show how latecomer firms progressed up the technological ladder within the electronics subcontract system called original equipment manufacture. Attention is also drawn to theoretical implications and the strengths, remaining weaknesses and future challenges facing latecomer firms.     

Concepts and practices of digital virtual consumption

Despite the popularity of online spaces that simulate aspects of consumption‐like experiences (online virtual worlds, video games and interactive functions on online retailers) conceptual tools that aim to comprehend such consumer practices are yet to emerge. In an effort to better understand them this paper puts forward a taxonomy that may help us capture emerging consumer behavior in the digital virtual terrain in relation to virtual and material consumption. This may be read as a fluid template that considers the movement between what resides in consumer imaginations as ideal or virtual, its actualization in material and now also digital virtual spaces. We then offer examples of the practices that are emerging, specifically the increase in imaginative resources that interactive media provide; practices that actualize probable, everyday commodities and experiences in the digital virtual and practices that actualize fantastic commodities and experiences in the digital virtual. Finally, we discuss the potential for these to produce new consumer subjectivities and new markets, and as a result we conclude with a discussion of the implications of such developments for consumer cultures, noting the potential for both liberatory/celebratory and critical discourse as well as avenues for future research.