International Competition for Multinational Investment

We examine the economic justification for providing investment subsidies to foreign-owned multinationals. These provide employment opportunities and generate demand for domestic intermediate inputs, produced by domestic workers with increasing returns to scale. Offering subsidies to multinationals may be in the national interest if the investment raises the net value of domestic production. When agglomerative forces are sufficiently strong, a subsidy that attracts the first foreign firm may induce several to enter, establishing a thriving modern sector. With a limited number of foreign enterprises, countries may compete to attract investment. This subsidy competition transfers much of the rents to the multinationals.
JEL classification: F 12; F 23     

Tax competition and the international distribution of firm ownership: an invariance result

How does the international distribution of firm ownership affect the outcomes of tax/subsidy competition for mobile plants? As corporate ownership becomes increasingly globalised, this question becomes increasingly important for policy. We prove a strong invariance result in the context of the tax/subsidy competition between two host countries for a monopoly firm’s plant. Both the equilibrium plant location and the equilibrium tax/subsidy offers are independent of the international distribution of the firm’s ownership. The reason is that the tax/subsidy competition equalises the firm’s post-tax profits across countries, making owners of capital indifferent towards the location of production.     

The introduction of Entry Level Stewardship in England: Extension or dilution in agri-environment policy?

Agri-environment schemes were introduced in the mid-1980s. Their primary objectives have developed from initially aiming to hold back intensification towards stimulating environmental enhancement. The introduction of Entry Level Stewardship (ELS) in England represents a third stage in seeking to extend the coverage of schemes across the majority of agricultural land. This aims to influence land use along the whole of the intensive margin. The ELS offers a wide range of options for which farmers are awarded points. Selection of options equivalent to 30 points per ha in lowland areas entitles farmers to a payment of £30 per ha. By September 2007, 4.4 million ha had been entered into the scheme, equivalent to 47% of the agricultural area. From amongst the options on offer, 34% of points were for boundary options, 20% for intensive grass options, 16% for management plans and 13% for options taking arable land out of production. The choice of options varies across the country with a higher proportion of the agricultural area entered in the East. Entry into the scheme is associated with total agricultural area, cereals farming, larger farms, a lower proportion of area in Environmentally Sensitive Area and Countryside Stewardship schemes and grazing livestock numbers. While the ELS has introduced a large number of new entrants into agri-environment schemes, the extent of the environmental impact is uncertain. Given the large number of options available, it is likely that farmers will have chosen options that involve relatively little change and incur limited cost. At the same time, it would be surprising if the environmental gains were of the types most valued within local areas. The ELS approach implies that public goods provided from agricultural land should be paid for irrespective of what would have happened in the absence of the scheme. While this may be a fairer approach, it may also undermine the idea of land stewardship and imply that payments will continue to be required in the long term in order to sustain provision. The ELS does establish a framework within which incentives could be targeted to deliver specific benefits within particular contexts and suggestions are made as to how policy might be developed for this.     

‘Thinking Outside the Box’? Trade Union Organizing Strategies and Polish Migrant Workers in the United Kingdom

This article focuses on the responses of British trade unions to the arrival of Polish workers since the 2004 enlargement of the European Union. It is argued that existing definitions and explanations of UK trade union engagement with migrant workers do not capture the strategies that have been used to engage with these migrant workers. We suggest that there have been two sets of responses. First, recruitment and organization activity has centred on inclusion and has been undertaken on new terrains using innovative strategies. Second, we point to the importance of new linkages locally, regionally, nationally and internationally in organizing these new labour market entrants.     

A sensemaking perspective on network pictures

This paper examines the concept of network pictures through the lens of the organizational sensemaking perspective. Essentially it develops the concept of network pictures by suggesting we think of them as exercises in sensemaking. It does so by providing an introduction to organizational sensemaking before establishing a degree of commensurability between network pictures and sensemaking. It suggests that what we may then see more clearly is that the concept of network pictures needlessly gets involved in reification when talking of ‘the’ network picture whereas a more dynamic approach leads to ideas of network picturing in which the complete discrediting or collapse of extant sensemaking and network pictures provides a research opportunity that could be jointly explored by both perspectives. The paper concludes that paradoxically ‘finding’ this new sense or new network picture appropriate to radically changed times is facilitated by a process that involves first ‘becoming lost’.     

Analysing the role of sustainable development indicators in accounting for and constructing a Sustainable Scotland

The main objective of this paper was to analyse how sustainable development indicators impacted upon the integration of sustainable development into the governing of Scotland. A major concern was whether an accounting technology could represent this complex multi-dimensional and interdisciplinary concept. We analysed the relationship between the official sustainable development strategy of the Scottish Executive and the associated indicator set using an analytics of government framework (Dean, M. (1999). Governmentality: Power and rule in modern society. London: Sage Publications. Dean, M. (2007). Governing societies. Berkshire: Open University Press). We observed a lack of alignment between these sustainable development indicators and the visions, fields of visibilities, forms of knowledge and techniques of government contained in this strategy. Critical aspects of this strategy were omitted from the indicator set and we argue that these indicators did not to effectively measure progress towards a Sustainable Scotland but that they could calculatively capture and distort the sustainable development governing process. The analytical framework used allowed us to problematise these indicators and contribute to a wider discourse on the composition and nature of sustainable development indicators.     

Satanic Mills?: An illustration of Victorian external environmental accounting

The paper evaluates a Victorian environmental account of the pollution of the River Wandle. This account was produced during a period of social and environmental crisis, when there were no significant industrial environmental regulations. This problematising external environmental account provides valuable insights into the historical development of social and environmental accounting. Our analysis located this account within an institutional reform programme to create systems of governance to mitigate the damage arising from unfettered industrial growth. We argue that problematising external environmental accounting has a longer tradition than previously recognised in the literature and predates corporate social and environmental reporting.     

Public trust,the law,and financial investment

How does trust evolve in markets? What is the optimal level of regulation and how does this affect trust formation and economic growth? In a theoretical model, we analyze these questions, given the value of social capital and the potential for growth in the market. When social capital is valuable, regulation and trustfulness are substitutes. In this case, regulation may cause lower aggregate investment and decreased economic growth. When the social capital is less valuable, regulation and trustfulness may be complements. In the paper, we analyze the optimal level of regulation and highlight the novel predictions of the model.