Pricing-to-Market Behavior: Japanese Exports to the US, Asia, and the EU

The paper examines the pricing-to-market (PTM) behavior of Japanese exporters in the US, Asian, and EU markets. Empirical evidence shows that PTM elasticity is highest to the US market. This matches the in-tuitive reasoning that the US market is more competitive than the EU and Asian markets for Japanese exporters. Furthermore, PTM elasticities estimated in this paper using expected exchange rates are positive but their amounts are smaller than PTM elasticities estimated by previous studies with actual exchange rates. The difference may be due to the fact that the invoice currency for most Japanese exports is the US dollar.     

Inventory Reduction and Productivity Growth: A Comparison of Japanese and US Automotive Sectors

This study assesses the inventory and productivity performance of the Japanese and US automotive industries in recent decades. Within each country we distinguish between vehicle assemblers and parts suppliers. In Japan, assemblers and suppliers made dramatic inventory reductions and productivity gains, particularly during the 1970s. By comparison, we find an unbalanced pattern for the United States: American assembly plants have been streamlined, but parts suppliers have stagnated. In both countries our findings suggest a strong association between inventory reduction and productivity growth © 1997 John Wiley & Sons, Ltd.     

Second-best efficiency of allocation rules: strategy-proofness and single-peaked preferences with multiple commodities

We study strategy-proof allocation rules in economies with perfectly divisible multiple commodities and single-peaked preferences. In this setup, it is known that the incompatibility among strategy-proofness, Pareto efficiency and non-dictatorship arises in contrast with the Sprumont (Econometrica 59:509–519, 1991) one commodity model. We first investigate the existence problem of strategy-proof and second-best efficient rules, where a strategy-proof rule is second-best efficient if it is not Pareto-dominated by any other strategy-proof rules. We show that there exists an egalitarian rational (consequently, non-dictatorial) strategy-proof rule satisfying second-best efficiency. Second, we give a new characterization of the generalized uniform rule with the second-best efficiency in two-agent case.     

Classical biased technical change approach and its relevance to reality

The purpose of this article is to evaluate empirically the classical viability condition for East Asia, Latin America, Sub‐Saharan Africa 1980–1995, and advanced countries 1950–1992. The viability condition is proposed by Foley and Michl (1999 Foley, D.K. and Michl, T.R. 1999. Growth and Distribution, Cambridge, MA: Harvard University Press.  [Google Scholar]), and is used for judging empirically which approach is more valid, the classical biased technical change approach or neoclassical production function approach. Our results acknowledge the predominance of the former, which is Foley‐Michl’s contention. However, there remains a disputable interpretation as to the case of a declining labour productivity, which is broadly seen in Latin America and Sub‐Saharan Africa during the period considered.     

URBANIZATION, URBAN CONCENTRATION AND ECONOMIC DEVELOPMENT

An international comparative study of the relations among the process of urbanization, urban concentration and economic development, and income distribution was performed by using data of developing and developed countries. Cross-section analyses at certain time periods for capturing "long-run" effects as well as time-series analyses for some countries for "short-run" effects were done taking advantage of the "rectangular" array of data. There were several interesting results: the pattern of unemployment rate in most developing countries shows an inverted-U shaped curve with respect to the degree of urbanization; the pattern of urban concentration is in the form of an inverted-U with respect to the economic development level; and the degree of inequality of income distribution seems to react in an inverted-U form to the variances in the extent of urbanization.     

Welfare implications of commodity price stabilization with partially flexible production,private storage and buffer-stock costs

Zusammenfassung Wohlfahrtsimplikationen einer Stabilisierung der Güterpreise bei partiell flexibler Produktion, privater Lagerhaltung und Kosten einer buffer-stock-Politik. - In diesem Aufsatz wird die traditionelle Literatur von Waugh-Oi-Massell zur Stabilisierung der Güterpreise auf ein Modell mit rationalen Erwartungen ausgedehnt, das eine partiell flexible Produktion, eine private Lagerhaltung zu Wettbewerbsbedingungen und die Kosten der Stabilisierungsbeh?rde für ihre buffer-stock-Politik umfa\t. Die Stabilisierung der Preise verbessert die Wohlfahrt jeder Gruppe, wenn die St?rungen im eigenen Bereich auftreten, vermindert aber die Wohlfahrt, wenn die St?rungen die Nachfrage oder das Angebot anderer Gruppen betreffen. Der private Sektor insgesamt gewinnt unzweideutig von der Preisstabilisierung, w?hrend die Stabilisierungsbeh?rden immer verlieren. Die Preisstabilisierung mag vielleicht die gesamte Gesellschaft (d.h. den privaten und den ?ffentlichen Sektor) einige Zeit besserstellen, im Endergebnis dürfte sie aber einen Verlust an potentieller sozialer Wohlfahrt verursachen.

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Résumé Des implications de bien-être d’une stabilisation de prix avec production partiellement flexible, stockage privé et co?ts de stock régulateur. - Cet article étend la littérature traditionnelle de Waugh-Oi-Massell sur la stabilisation de prix à un modèle d’expectative rationnelle qui inclut une production partiellement flexible, un stockage privé compétitif et des co?ts des autorités pour les opérations de stock régulateur. Une stabilisation de prix améliore le bien-être de chaque groupe, si les perturbances se passent dans leurs domains, mais elle réduit le bien-être si les perturbances affectuent la demande ou l’offre d’autres groupes. Le secteur privé en ensemble gagne sans aucun doute de la stabilité de prix pendant que les autorités de stabilisation perdent toujours. Une stabilisation de prix pourrait améliorer la situation de la société entière (c.-à.-d. les secteurs privés et publiques) pour quelque temps, mais éventuellement pourrait générer une perte de bien-être potentiel social.

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Resumen Implicaciones para el bienestar de la estabilización de precios de materias primas bajo productión parcialmente flexible, almacenamiento privado y costos de buffer stocks. - Este trabajo extiende el modelo traditional de Waugh-Oi-Massell de estabilización de precios de materias primas a uno de expectativas racionales con production parcialmente flexible, almacenamiento privado competitivo y costos de operaciones buffer stock. La estabilización de precios aumenta el bienestar de cada grupo con respecte a sus propias perturbaciones y reduce el bienestar con respecte a perturbaciones que inciden sobre la demanda o la oferta de otros grupos. El sector privado claramente gana con precios estables, mientras que las autoridades responsables de la estabilización siempre pierden. La estabilización podría mejorar el bienestar de la sociedad entera (o sea de los sectores privado y estatal) por un eierte tiempo, mas posiblemente daría lugar a una pérdida potencial de bienestar social.

     

Informational leverage: the problem of noise traders

The literature suggests that security design can be used to manipulate the information content of securities prices [what is referred to as the “informational leverage effect” in Boot and Thakor (J Finance 48, 1349–1378, 1993)]. The informational leverage effect arises in this literature in a market microstructure environment in which noise trade is exogenous, which is a fairly standard assumption dating back to the framework developed in Grossman and Stiglitz (Am Econ Rev 70, 393–408, 1980). This assumption is relaxed in our paper, and we show that the informational effects described in the related literature become less clear cut when noise trading activity is endogenous. We find that the intensity and direction of these effects depends crucially on the parameters describing the modeling environment. The elegant point of the informational leverage literature is that these effects arise largely independently of such parameters, but with endogenous noise trading that is no longer true. This literature may, therefore, lead to too strong conclusions being drawn about the relationship between information revelation and security design. We are very grateful for the helpful comments made by an anonymous referee.     

Would Excess Capacity in Public Firms Be Socially Optimal?

We analyse oligopolistic interactions between a welfare-maximizing public firm and a profit-maximizing private firm in a repeated game. We find that the public firm can hold excess capacity as a strategic punishment device to sustain a subgame perfect equilibrium which is welfare-superior to the static Nash equilibrium. Basically, potential punishment from the public firm in the dynamic game can make the self-interested private firm behave in the public interest. Furthermore, if capacity is endogenous, public excess capacity can occur in a welfare efficient equilibrium when the cost of public capacity investment is higher than that of private investment.