An Examination of the Interaction Between Modelling and Its Relationship with Construction Kits: Lessons from the Past and for the Future

Construction kits have played a significant part in nurturing the growth and development of the minds and manipulation-based skills of children (and adults) in formal and non-formal education settings. These kits have origins rooted in the representation of the built world and now have a diversity of form and function, including technical versions with moving parts. This article examines some of the historically based ideas that lie behind the role that kits may have in terms of physical modelling. The article traces the transformation of kits from simple bricks and blocks into more complicated pieces for space-filling and achieving the transfer of forces and motion. This transformation occurred during the Victorian era when the influence of the ideas of educationalists and, perhaps rather strangely, exponents of early aviation, played major roles in determining the diversity of forms of construction kit and modelled possibilities that are now to be seen in classrooms and homes. The article ends with a review of some of the lessons from the past and present that will need to be considered in relation to concrete modelling in schools for the future. This revised version was published online in July 2006 with corrections to the Cover Date.     

FDI facilitated by agglomeration economies: evidence from manufacturing and services joint ventures in China

The open door policy of China’s economic reform since the 1980s has attracted heavy foreign direct investment (FDI) flows into China and especially to Guangdong (particularly the Pearl River Delta region, PRD) and induced significant economic growth during the past two decades. While there exist various classical theories of FDI in attempting to identify the determinants of FDI inflow and to explain the behavior of FDI flows, limited attention has been given from the perspective of agglomeration effects generated by a core-periphery (CP) relation.This paper intends to study the impacts of agglomerations on FDI inflows in the context of Krugman’s CP relation (1991) by investigating (1) the formation of a CP relation via gravity model analysis; (2) whether different types of industry FDI flows will respond differently in the CP-system, given agglomeration effects; and (3) whether FDI origin and firm scale matter in affecting FDI flows.A database consisting of a population frame of 37,742 firm-level manufacturing and services joint ventures investing in Guangdong in 1998 was used. Empirical results show that the agglomerations of the CP relation have affected FDI flow patterns. While both manufacturing and services FDI and sources of investment responded differently to the impacts, smaller firms were found more responsive to the CP-agglomeration settings regardless of FDI by industry type and by source. The significance and implications of the CP-system to further facilitate FDI in the region are discussed.     

Housing Transactions and the Changing Decisions of Young Households in Britain: The Microeconomic Evidence

In this second of two related papers in this issue, the causes of declining levels of housing transactions in Britain during the 1990s are explored. The lower transaction levels resulted partly from the changing behavior of young individuals. Both household formation and owner–occupation rates of these groups also fell sharply. Using panel data, we investigate the causes of reduced new household formation and owner–occupation, finding that changes in the income distribution away from young cohorts have been an important factor.     

A Paleoeconomic Theory of Co-Evolution and Extinction of Domesticable Animals

One Pleistocene mystery is why early North Americans eradicated their large, potentially domesticable animals (e.g., horses), whereas early Europeans did not. A commonly‐held hypothesis is that European species were evasive due to co‐evolution with hominids, whereas North American animals were naïve and unable to adapt quickly enough when experienced human hunters arrived from Eurasia. We explore this hypothesis with a paleoeconomic model of co‐evolution that integrates human hunting investments and wildlife population responses. We find that investments in hunting ability, based on the relative scarcity of prey species, could have mattered more than wildlife ‘naivety’ in explaining the extinction.     

Inter-industry technology flows in the US food-processing industries

The study examines the origins of technology important to improving productivity in the food-processing industries. Technology flows were measured both by patents in patent classes closely identified with six food industries, and by a sample of significant food-processing innovations. These data are consistent with the hypothesis that interindustry technology flows are the most significant determinant of productivity improvements in the food industries. These findings solve the enigma that the food-processing industries have enjoyed rapid improvements in productivity despite making very modest investments in research and development.     

A Permanent Change in the Route to Owner Occupation?

This paper attempts to explain why home ownership rates among young adults fell in the early 1990s when various indicators suggested it had become more affordable. As a potential explanation, we focus on the relatively slower growth in their incomes and argue that this could signal a fundamental change in behaviour, a change in route adopted into owner occupation, induced by structural economic change. In examining the implications for housing tenure, we use a conditional fixed effects multinomial logit model to exploit the information on the tenure choice and the timing of transitions in the British Household Panel Survey. Our results reveal that relatively slower income growth contributed significantly to this decline and that ignoring the intertemporal correlation in micro‐panels generates inconsistent results.     

Neuroeconomics: Why Economics Needs Brains

Neuroeconomics uses knowledge about brain mechanisms to inform economic theory. It opens up the “black box” of the brain, much as organizational economics opened up the theory of the firm. Neuroscientists use many tools—including brain imaging, behavior of patients with brain damage, animal behavior and recording single neuron activity. The key insight for economics is that the brain is composed of multiple systems which interact. Controlled systems (“executive function”) interrupt automatic ones. Brain evidence complicates standard assumptions about basic preference, to include homeostasis and other kinds of state‐dependence, and shows emotional activation in ambiguous choice and strategic interaction.     

Beyond HIPC: What are the Prospects for Debt Sustainability?

Abstract: The pronouncement by the G‐8 Summit at Gleneagles in July 2005 on debt cancellation under the HIPC Initiative, affirmed by the G‐8 Ministers of Finance in Washington in September, should signal the beginning of debt relief for the world's heavily indebted poor countries (HIPC), mostly African. It is expected that debt cancellation should return the beneficiary countries to debt sustainability and afford their governments the fiscal space to invest in basic infrastructure and social services. Countries could significantly enhance their prospects for maintaining debt sustainability mainly by adopting debt management strategies that de‐emphasize excessive borrowing, checking the expansion of unproductive public sector activities and the associated fiscal deficits, financial restructuring to reduce the bias against autonomous capital flows, and taking deliberate actions to expand exports.     

DYNAMIC ASSET ALLOCATION AND CONSUMPTION CHOICE IN INCOMPLETE MARKETS*

We study the optimal investment and consumption problem of a CRRA investor when the drift and volatility of the stock are driven by a correlated factor. The myopic and non‐myopic components of the optimal portfolio process are characterised in terms of the market price of traded and non‐traded risk of the minimax martingale measure. We find that the optimal policies depend crucially on the nature of the agent, aggressive versus conservative, and the market incompleteness, improving versus deteriorating investment opportunities. Furthermore, we show that the original problem cannot be decomposed into a pure consumption and a pure terminal wealth problem, unless the market is complete.     

Internal labour markets in the Australian banking industry: their nature prior to the Second World War and their recent decline

This paper uses evidence from late nineteenth-and early twentieth-century personnel records of two Australian banks to examine the nature of internal labour markets prior to the Second World War. It is argued that the industry possessed all the classic features of internal labour markets: limited ports of entry, internal promotion, long careers, and assignment of wages by well-defined rules. The paper then examines the reasons why banks adopted internal labour markets. Finally, the paper examines the recent decline of internal labour markets and examines the role of technological and social changes in this decline.