INTERNATIONAL TRADE AND REGIONAL DEVELOPMENT

The paper considers a two-region model of trade based on the authors'earlier (HS) model, in which two nontraded goods, one urban and one rural, were introduced into the Harris-Todaro model. The HS framework captures the duality of the labour market, and it is argued that the HS model is suited to the purpose of regional analysis where the urban and rural agents may be in conflict as their welfare (income) may not respond in an identical manner to exogenous shocks and policy changes. The paper examines the implications of a change in capital and the terms of trade on outputs and regional incomes. It is established that in response to a terms-of-trade shock the prices of urban and rural nontraded goods could move in opposite directions, so structural change could also be in opposite directions. The same could also be true of welfare in the two regions.     

Tariff liberalization and trade specialization: Lessons from India

This paper analyzes the effects of policy reform on the structure of India’s trade in manufactures, from 1990 to 2006. It computes comparative advantage indicators on the basis of disaggregated trade flow data and assesses the effects of trade liberalization on the evolution of India’s pattern of trade specialization. Industries where import tariffs have been reduced the most have experienced the highest increase in specialization. Moreover, trade liberalization has helped India improve its comparative advantage in industries with medium- to high-technology content, as well as in some of the industries enjoying the most robust growth in global demand. Liberalization policies have been instrumental in enhancing the international competitiveness of industries.     

The extensive and intensive margins of Spanish trade

Recent empirical research highlights that differences in trade flows across countries, products and years are governed by two margins: the intensive margin and the extensive margin. The analysis of the relative contribution of each margin is very important to determine which policies can be more efficient to foster trade at the aggregate, geographic, product or firm level. We use the whole universe of firm level transaction data to analyse the relative contribution of these margins to changes in Spanish trade flows during the 1997–2007 period. We first apply the methodology proposed by Bernard et al. (2009 Bernard, A.B., Jensen, J.B., Redding, S.J. and Schott, P.K. 2009. The margins of US trade. American Economic Review: Papers & Proceedings, 99(2): 487–93. [Crossref], [Web of Science ®] [Google Scholar]) to decompose trade variation over time into three components: net entry of firms, product-country switching and value growth by regular trading firms. The first two components correspond to the extensive margin and the last one refers to the intensive margin. We find that short-run changes in exports and imports are governed by firms’ intensive margin; however, in the long-run, both the extensive and the intensive margins are equally important to foster trade. We also examine the importance of the trade margins at the cross-sectional level for the year 2007. We find that large differences in the Spanish trade flows across countries and products, especially in the case of exports, are explained by the number of firms that participate in trade, which is consistent with the fact that the number of trading partners decline significantly with distance.     

The Flexible–Rigid Paradox of Employment Relations at Royal Mail (UK)

This article examines how flexibility and rigidity equally pose a dilemma for management and trade unions. It explores the issue by examining a range of features within the employment relationship at the Royal Mail in the UK. It seeks to demonstrate how, in practice, both management and trade unions can require, pursue and argue for different and competing combinations of flexibility and rigidity. It concludes that it is analytically more useful to examine the content and form of the 'flexible–rigid mix' and explore how this is mediated by political, social and operational/technical processes.     

Uncertainty and Endogenous Selection of Economic Equilibria

This paper presents a model of coordination failures based on market power and local oligopoly. The economy exhibits a multiplicity of Pareto‐ranked equilibria. The introduction of uncertainty generates an endogenous equilibrium selection process, due to a strategic use of information by firms. The economy is more likely to settle on some equilibria than on others. We argue that a full understanding of these robustness criteria is needed before any policy which is intended to help coordinate the level of activity to a Pareto‐dominant outcome can be successfully implemented.     

New communication systems and trade union politics: a case study of Spanish trade unions and the role of the internet

This article shows how engagement with the internet and aspects of the new economy/society require an appreciation of union difference and politics. It shows how union responses vary due to four factors: communication strategies, union identity, forms of internal democracy and a range of organisational and social contingencies. The article will study the phenomena of the internet in the context of one national case study, Spain. It is a country that allows us to view the political dimensions of the internet, and the way they link to communication strategies, due to the manner in which the labour movement has transformed and modernised itself. It is also of interest because methods of communication have been at the heart of the way in which unions have developed and differentiated themselves. This article will argue that a greater sensitivity is required in terms of union history, politics and identity if the impact and use of new forms of communication are to be fully appreciated. It also points to the need to appreciate tensions between different forms of communication.     

Investment Irreversibility and Finance Constraints

This paper analyses the investment behaviour of firms in the presence of irreversibility and of a dividend payout constraint. Estimation of investment equations for a panel of UK firms shows that the Q model performs well, over regions of the sample space, where neither constraint is likely to be binding. The constraints are able to account for the empirical significance of cash flow variables for the remaining firms in the sample.     

Do Other Firms Matter in Oligopolies?

This paper examines how firms interact with their rivals. The main novelty of our approach is that we let conjectural variations depend on the actual ability of other firms to react, which we measure by both the physical capacity and financial status of firms. Our main findings are twofold. First, physical and financial capacity significantly affect conjectures. Second, we recover the implied conjectural variations and reject homogeneous conjectures. We generally find that leaders expect aggressive responses, and followers are Cournot players.     

What is Alive and What is Dead in the Theory of Corporatism

The term ‘corporatism’ simultaneously designates a particular interest group structure, characterized by monopolistic, centralized and internally non‐democratic associations, and a particular policy‐making process, also known as ‘concertation’ or ‘social partnership’. This paper argues that structure and process may no longer be closely associated. By focusing on the Irish and Italian cases, it shows that concertation is perfectly compatible with a non‐corporatist structure of the interest representation system. Inter‐ and intra‐organizational co‐ordination remains important for the viability of concertation. However, it can be achieved, even in relatively fragmented systems like the Irish and the Italian, through alternative mechanisms relying on democracy and discussion.