A Social and Economic Model for Europe

The problems that social and labour market institutions are facing today are often attributed to globalisation and ageing. This article argues that globalisation merely exposes inherent weaknesses in social institutions while ageing aggravates them, but that neither of the two phenomena is the fundamental cause of the challenges. Moreover, there is no inherent trade-off between social and economic policies, but to reconcile the policies comprehensive modernisation is needed. Each country can face the challenges should they wish to do so and converging to a single social model is neither needed nor wanted. Finally, European (economic) and national (social) policies become increasingly intertwined and this calls for a new role for Europe. * Bureau of European Policy Advisers, European Commission. The authors would like to thank Tassos Belessiotis for his valuable comments. The authors would also like to thank their colleagues Declan Costello, Georg Fischer, Agnes Hubert, Frédéric Lerais, Mattias Levin, Roger Liddle and Jér?me Vignon. In addition valuable comments by Lans Bovenberg, Gosta Esping-Andersen, Ruud de Mooij, Frederick van der Ploeg and Fritz Scharpf were appreciated. The views expressed in this article are the views of the authors and do not bind the European Commission.     

Assessment of vehicle speeds on different categories of roadways in Ghana

Empirical evidence from road safety literature suggests that vehicular speed is an important risk factor in the incidence and severity of road traffic crashes globally. Speed studies are at rudimentary stages in developing countries, thus making vehicular speed research imperative. The main aim of the study was to establish two major speed parameters, namely, the mean and dispersion, and their implications for more extensive and long-term speed monitoring in Ghana. Research workers stationed themselves in a parked car and used a radar gun to unobtrusively measure the travelling speeds of 28,489 vehicles at 15 different inter-urban locations on three highway categories. Excessive speeding is very pervasive on all highway categories in Ghana. Travelling speeds through settlements where a speed limit of 50 km/hour is mandatory were particularly excessive. Generally, 98%, 90% and 97% of vehicles exceeded the posted speed limit of 50 km/hour on national, inter-regional and regional roads respectively. Mean speeds and speed dispersions (as assessed by the standard deviations) through built-up areas were 81.3 +/- 17.3 km/hour on national roads, 64.7 +/- 12.3 km/hour on inter-regional roads and 72.6 +/- 13.4, km/hour on regional roads. On rural undivided highways with an 80 km/hour speed limit, mean and speed dispersions were 90 +/- 18.9 km/hour on national roads, 80.1 +/- 16 km/hour on inter-regional roads and 84.4 +/- 15.6 on regional roads; also translating into 66%, 47% and 60% of vehicles exceeding recommended speeds. In all cases, speed dispersions were notably higher than the value of 10 km/hour generally found in developed countries. Excessive speeding and wide speed dispersions are highly prevalent on Ghana's highways. These factors likely account for the high incidence of traffic crashes and fatalities in Ghana. An integrated speed monitoring and control programme and by-passing small and medium settlements would be required for the reduction of speed-related crashes, fatalities and injuries.     

Are the developing countries in reality “Exporters of capital”?

The developing countries have missed no opportunity at any of the great international conferences in recent years to raise the demand for larger capital transfers by the developed countries. Whether compliance with this demand can really contribute to narrowing the North-South gap must however be doubted. According to the following calculations interest payments, royalties and—overt or hidden— profit retransfers have already reached such an amazing dimension that the developing countries would in reality have to be regarded as “capital exporters”.     

The Relation Between Ethical Behaviour and Workstress Amongst a Group of Managers Working in Affirmative Action Positions

Unethical acts and reported cases of corruption and commercial crimes in South African business are increasing. Literature studies showed that risk groups (for instance South African managers in affirmative action positions) are functioning in a stressful environment which can give rise to unethical acts. Results pointed out that high stress correlates substantially with: to claim credit for a subordinate's work; to fail to report a co-worker's violation of company policy, to offer potential clients fully paid holidays; and to purchase shares upon hearing privileged company information. In the light of this a number of recommendations were made.     

Informal Credit,Usury, or Support? A Case Study for Vietnam

The informal credit market remains an important source of finance for the poor in Vietnam. Yet, little if anything is known about the impact of informal loans on poverty and inequality, and the Vietnamese government has no policies towards the informal credit market. In the present study paper, we found that the effect of credit from friends and relatives on per capita expenditure is positive but not statistically significant. Meanwhile, the effect of credit from private moneylenders on per capita expenditure is positive and statistically significant. Borrowing from private moneylenders increases per capita expenditure of households by around 15%. Further, it reduced the poverty incidence of borrowers by around 8.5 percentage points in 2006 and significantly decreases the poverty gap index and the poverty‐severity index. Borrowing from private moneylenders also reduces expenditure inequality, albeit at a very small magnitude.     

Resource utilisation Efficiency: A South African Provincial Evaluation

The objective of this paper is to analyse the utilisation of production capacity and total under‐utilisation in order to identify weak‐performing industries across the nine South African provinces. Detecting inefficiencies within the different provinces will help to identify where sound managerial or government intervention is required, which can contribute to the future success of the New Growth Path Framework and the Strategic Integrated Projects. Using a multistage data envelopment analysis model at the subnational level, several categories of production factors are explored: intermediate demand, labour, capital, as well as taxes and subsidies. The results emphasise South Africa's weak infrastructure and the failure to effectively promote stability in managing factor inputs. The results further illustrate that industry scale efficiency for water and electricity are poorest across all provinces, highlighting the current water and energy supply concerns in South Africa and problem areas associated with the National Development Program.     

The Maddison Project: collaborative research on historical national accounts

The Maddison Project, initiated in March 2010 by a group of close colleagues of Angus Maddison, aims to develop an effective system of cooperation between scholars to continue Maddison's work on measuring economic performance in the world economy. This article is a first product of the project. Its goal is to explain the aims and approach of the project, and, as a first result of this ‘collaboratory’, to inventory recent research on historical national accounts. We also briefly discuss some of the problems related to these historical statistics and we extend and where necessary revise the estimates published by Maddison in his latest overviews. Most new work relates to the period before 1820; it leads to a reassessment of levels of GDP per capita in western Europe in the early modern period, and to a confirmation of Maddison's previous estimates of Asian levels of real income.     

Non-financial Determinants of Retirement: A Literature Review

Retirement is often concentrated at specific ages—in particular the ‘normal retirement age’ and an ‘early retirement age’. Financial incentives cannot fully explain this. Moreover, the participation effect of a higher normal retirement age importantly exceeds the encompassing income effect. Based on a literature survey, we conclude that social norms, default options, and reference-dependent utility are likely explanations for the individual propensity to retire at specific retirement ages. Further empirical research on non-financial determinants of retirement is needed to fully understand individual retirement behavior.     

FDI and Income Inequality—Evidence from Latin American Economies

This paper analyzes whether foreign direct investment (FDI) has contributed to the wide income gaps in Latin America. Panel cointegration techniques as well as regression analysis are performed to assess the impact of inward FDI stocks on income inequality among households in Latin American host countries. The panel cointegration analysis typically reveals a significant and positive effect on income inequality. There is no evidence for reverse causality. The findings are fairly robust to the choice of different estimation methods, sample selection and the period of observation.     

Excessive Volatility is Also a Feature of Individual Level Forecasts

The excessive volatility of prices in financial markets is one of the most pressing puzzles in social science. It has led many to question economic theory, which attributes beneficial effects to markets in the allocation of risks and the aggregation of information. In exploring its causes, we investigated to what extent excessive volatility can be observed at the individual level. Economists claim that securities prices are forecasts of future outcomes. Here, we report on a simple experiment in which participants were rewarded to make the most accurate possible forecast of a canonical financial time series. We discovered excessive volatility in individual-level forecasts, paralleling the finding at the market level. Assuming that participants updated their beliefs based on reinforcement learning, we show that excess volatility emerged because of a combination of three factors. First, we found that submitted forecasts were noisy perturbations of participants’ revealed beliefs. Second, beliefs were updated using a prediction error based on submitted forecast rather than revealed past beliefs. Third, in updating beliefs, participants maladaptively decreased learning speed with prediction risk. Our results reveal formerly undocumented features in individual-level forecasting that may be critical to understand the inherent instability of financial markets and inform regulatory policy.