Crime and punishment in the “American Dream”

We observe that countries where belief in the “American dream”(i.e., effort pays) prevails also set harsher punishment for criminals. We know that beliefs are also correlated with several features of the economic system (taxation, social insurance, etc). Our objective is to study the joint determination of these three features (beliefs, punitiveness and economic system) in a way that replicates the observed empirical patterns. We present a model where beliefs determine the types of contracts that firms offer and whether workers exert effort. Some workers become criminals, depending on their luck in the labor market, the expected punishment, and an individual shock that we call “meanness”. It is this meanness level that a penal system based on “retribution” tries to detect when deciding the severity of the punishment. We find that when initial beliefs differ, two equilibria can emerge out of identical fundamentals. In the “American” (as opposed to the “French”) equilibrium, belief in the “American dream” is commonplace, workers exert effort, there are high powered contracts (and income is unequally distributed) and punishments are harsh. Economists who believe that deterrence (rather than retribution) shapes punishment can interpret the meanness parameter as pessimism about future economic opportunities and verify that two similar equilibria emerge.     

The Manufacturers' Choice of Distribution Policy under Successive Duopoly

We examine an asymmetric noncooperative game between two manufacturers selecting the number of retailers who can distribute their products. In deciding whether to distribute through one or both retailers, there are two conflicting effects: the output expansion effect, because the product is sold in more outlets; and the competitive effect, associated with the introduction of intrabrand competition. Product differentiation and demand asymmetries between the two products determine which of these two effects dominates the other. When product differentiation is strong and brand asymmetry is moderate, both manufacturers distribute through both retailers in equilibrium. However, when both product differentiation and brand asymmetry are weak, exclusive dealing through a single retailer is the equilibrium. Perhaps the most interesting finding is that there also exist asymmetric equilibria in which one manufacturer distributes through both retailers but the other manufacturer distributes through one retailer. These equilibria can arise when both product differentiation and brand asymmetry are strong.     

The long goodbye: new establishments and the fall of union voice in Britain

This paper argues that the secular decline in union voice in the UK cannot be fully explained without understanding the role of employers in choosing and modifying voice regimes. The paper presents a model of employee voice; the model assumes regimes are chosen by firms on the basis of positive net benefits, and that once adopted there are switching costs associated with changing regimes. The paper presents data from WERS, which is then analysed in terms of the model. We find a rise in voice regimes that do not include unions (i.e. the growth of so-called non-union voice) and a clear decline in voice regimes involving unions, particularly union-only voice. Ecological factors (i.e. new entrants and the demise of older workplaces) are primary in explaining the rise in non-union voice, whereas the shift to dual forms of voice (made up of union and non-union regimes side by side) was primarily the result of switches undertaken by union only workplaces as early as the 1950s.     

Satisfaction of individual mobile phone users in Spain

Consumer satisfaction is a key determinant of consumer retention, consumer welfare, and is also a strategic variable for competition and international comparisons. Spain's mobile customer satisfaction is the lowest in the European Union. The focus of this paper is to identify the determinants of residential mobile phone users' satisfaction among private consumers of mobile telecommunications in Spain. Two innovative aspects of this paper are the focus on a nationwide representative sample of residential consumers in Spain, and the usage of rich individual data to convey high quality statistical information. The correlation of each of the aspects to the overall satisfaction are measured. Also, relationships between different aspects of satisfaction and its determinants are formulated. The paper specifies econometric models and estimates them using a survey of 4249 mobile phone users. The results indicate that customers are less satisfied with larger carriers, and are more satisfied with smaller and newer operators. Policy recommendations are suggested to improve customer satisfaction, contribute to customer retention and improve the position of the country in the international rankings.     

North–South trade liberalization and returns to skill in the south: The case of Mexico

This study examines the effect of North American Free Trade Agreement (NAFTA), an instance of North–South trade liberalization, on returns to skill in Mexico. Mexico is abundant in low-skill workers relative to the US and Canada, and so, by the Heckscher–Ohlin–Samuelson trade model, NAFTA ought to have raised the relative earnings of low-skill workers, that is, lowered returns to skill in Mexico. Analysis of Mexican labour micro-data yields the finding that while returns to skill in industries producing tradeables have risen, ceteris paribus, since Mexico embarked upon trade liberalization by joining the GATT in 1986, this rise was less pronounced by 1999 in industries liberalized relatively rapidly by NAFTA, launched in 1994, than in industries liberalized relatively slowly by this phased trade treaty. This is considered evidence of NAFTA holding back rise in returns to skill, since it is plausible such a dampening would have been more marked in industries more rapidly exposed to trade with Mexico's skill abundant northern neighbours. Hence, this study suggests trade with developed nations may lower returns to skill in developing nations.     

Economic growth in a world of ideas: the US and the leading European countries

This article discusses the ideas creation model that was initially formulated by Romer and later generalized and empirically applied by Jones. In particular, we generalize Jones' model to include catching up to a technological frontier, which improves the empirical results for European countries, and ensures convergence to the technological frontier in the steady state     

Measuring innovation in long product development cycle industries: an insight in biotechnology

This paper examines and measures innovation in the context of biotechnology firms by analysing the link between R&D, innovation performance and organisational growth. We conceptualise innovation performance as a latent construct with two dimensions: innovation efficacy and innovation efficiency. We use structural equations modelling to test the hypotheses on a data set from the biotechnology industry. Results support our innovation performance conceptualisation which is found to be especially useful to measure innovation in industries with long product development cycles. Findings also underline the importance of R&D knowledge creation for biotechnology firms.     

Identifying agroecological mixed farming strategies for local conditions in San Antonio de Los Baños,Cuba

Building on previous research at the experimental and national scales, this study was carried out at the local scale over a four-year period on three farms of reference: one specialized dairy farm ‘Vaquería 10’ (33.7 ha) and two mixed farms, ‘Remedio’ (9.4 ha) and ‘La Sarita’ (47 ha). All three farms are located in the San Antonio de Los Baños municipality, Havana, Cuba. This study illustrates the application of the Ecological Framework for the Assessment of Sustainability (ECOFAS). This methodology consists of a cyclical structure of six steps, aimed at guiding the process of implementing innovative mixed (crop–livestock) farming strategies. Local stakeholders (farmers, researchers, extension officers and representatives of the ministry of agriculture in the municipality) identified alternative strategies for agriculture in the region, based on the critical technological, environmental and socio-economic factors constraining the current performance of farming systems. The results show that implementation of ‘best practice’ mixed farming systems management strategies in the region potentially can lead to a strong positive impact on land productivity, food self-sufficiency as well as improve socio-economic performance.