STRATEGIC INVESTMENT IN A LABOUR‐MANAGED DUOPOLY

Developing a Cournot two‐stage game model with strategic capital interaction, we compare two different kinds of equilibrium in a labour‐managed (LM) duopoly. An LM firm's reaction function is negatively sloped when capital and output are simultaneously determined, while the slope of its reaction function in the second stage changes in sign depending on the magnitude of its labour‐expansion elasticity. Hence, whether the LM firms employ more capital and produce greater output at the equilibria in the two‐stage game model than at the equilibria resulting from the simultaneous selection of capital and output depends on the magnitude of their labour‐expansion elasticity.     

Filial Obligations and Child Labor

The model presented here reproduces the empirical fact that poorer countries show a higher incidence of child labor and time‐intensive care of retired parents, whereas richer countries have negligible child labor and people indulge in money‐intensive care of the old. For that purpose, the effect of social norms of filial obligations on child labor and schooling decisions is analyzed. It is shown that norms of filial obligations are sustainable as an equilibrium in the intergenerational game. Widely discussed contracting problems à la Becker, which allegedly explain underinvestment in schooling by poor households, are thus solved. However, this alone does not induce the elimination of child labor. Technological parameters and relative returns to schooling also play a fundamental role.     

Variety‐Controlling Public Policy Under Addiction and Saturation

This paper constructs a tractable general equilibrium model for investigating the dissimilar effects of addiction and saturation on consumption and public policy. By introducing an industry‐specific intertemporal consumption externality, we provide clear analytical results that a lump‐sum subsidy for firms can increase welfare in the presence of a negative externality (saturation). A tax can accomplish the same given a positive externality (addiction). Unlike existing studies of cultural goods, these results are not based on assumptions concerning exogenous different preferences across groups, but rather on conventional monopolistic competition and consumption habit formation models in macroeconomics.     

R&D,unemployment, and labor market policies

This paper studies the effects of labor market policies on R&D activities and unemployment. I develop a search and matching model in which firms’ R&D decisions are endogenously determined. The model demonstrates that more intensive labor market policies that protect workers reduce the levels of R&D activities. This study offers a theoretical framework to understand the relationship between R&D activities, labor market policies, and unemployment which is discussed in empirical studies.     

BUSINESS CYCLES IN SMALL OPEN ECONOMIES: EVIDENCE FROM PANEL DATA BETWEEN 1900 AND 2013

Using a novel data set for 17 countries between 1900 and 2013, we characterize business cycles in both small developed and developing countries in a model with financial frictions and a common shock structure. We estimate the model jointly for these 17 countries using Bayesian methods. We find that financial frictions are an important feature for not only developing but also small developed countries. Furthermore, business cycles in both groups of countries are marked with trend productivity shocks. Common disturbances explain one third of the fluctuations in small open economies, especially during important worldwide phenomena.     

The emerging non‐profit sector in Japan: Recent changes and prospects

This paper hopes to map out the historical, legal and political contexts of the non profit sector and explore some of the recent developments which have helped expand voluntary activities and promote the changes the NPO sector has been experiencing over the last five years or so. Then, the paper goes on to raise some of the issues which need to be addressed for the further development of the NPO sector.