Matching frictions,unemployment dynamics and the cost of business cycles

We investigate the welfare cost of business cycles implied by matching frictions. First, using the reduced form of the matching model, we show that job finding rate fluctuations generate intrinsically a non-linear effect on unemployment: positive shocks reduce unemployment less than negative shocks increase it. For the observed process of the job finding rate in the US economy, this intrinsic asymmetry increases average unemployment, which leads to substantial business cycles costs. Moreover, the structural matching model embeds other non-linearities, which alter the average job finding rate and consequently the welfare cost of business cycles. Our theory suggests to subsidizing employment in order to dampen the impact of the job finding rate fluctuations on welfare.     

Does “hot money” drive China's real estate and stock markets?

The paper investigates the extent of the impact from “hot money” or speculative capital inflow on the fluctuations of China's real estate market and stock market. The results indicate that hot money has driven up property prices as well as contributed to the accelerating volatilities in both markets due to its enormous size and its short-term characteristic of investing. In particular, we find that hot money ranks as the second largest contributor in the fluctuations of China's real estate prices. In the “risky” regime, which corresponds to more inflows and higher volatility of hot money, the effects are even more prominent.     

EU Trade Regulation for Baby Food: Protecting Health or Trade?

This paper explores the effect of European Union (EU) food safety regulations on EU imports of baby food. Pesticides and contaminants contribute to various health problems. Children are more vulnerable to the dangers of pesticides and contaminants because as soon as they start eating solids, they consume a limited number of food items, most of which are fruits and vegetables. To protect the health of the most vulnerable part of the population, the EU regulations stipulate that no more than 0.01 mg/kg of any single pesticide residue is permitted in baby food. In this respect, the EU differs from most of its trading partners, the majority of which do not differentiate food safety regulations according to the age of the consumer. The purpose of this paper is to compare the EU regulations on maximum residue limits of pesticides to those of its major competitors through a severity index. This index is then introduced into a gravity equation to assess the impact on EU imports of baby food. We find that the EU regulation had a negative impact on the volume of trade but a positive one on the probability of setting up new trade relationships.     

Contextualising diversity management in the Middle East and North Africa: a relational perspective

This study examines the clash between diversity policies as designed in the West and the challenges in implementing these in the Middle East and North Africa region. We contribute to the role of context in diversity management by studying how HR managers deal with diversity policies when the Western approach and the local context are perceived as being incompatible. Twenty HR/diversity managers working for multinational companies in nine different countries in the Middle East and North Africa region were interviewed. The findings show that a manager's understanding of the interrelated nature of multilevel factors of the local context influences the strategies adopted. Three strategies to deal with the perceived clash are identified: forcing a Western approach upon the local country, a reframing strategy where existing policies are reformulated to fit the Western requirements, and a sensitive approach in which the local context is considered. The study suggests that multinationa.l companies have to adapt diversity policies to local multilevel factors of the country in which they operate.     

The Wage Inflation‐Unemployment Curve at the Macroeconomic Level

Based on the reduced form New Keynesian Wage Phillips Curve, we estimate wage rigidity and indexation at the aggregate level in several advanced countries for the 1985–2014 period. We document that the wage setting process is heterogenous among our sample of countries: nominal wage rigidities are more important in the United States, while wage indexation is dominant in European Countries. We also present evidence that indexation to past inflation has decrease as inflation stabilizes at lower levels. In addition, our results suggest that wage rigidity is not linked to the institutional environment at the macroeconomic level. Finally, we show that there is significant time variation in the estimated coefficients on the implied equation that is usually not taken into account in the theoretical literature.     

Effects of Sponsorship Disclosure Timing on the Processing of Sponsored Content: A Study on the Effectiveness of European Disclosure Regulations

This study investigates whether the timing of sponsorship disclosure affects viewers’ processing of sponsored content, and whether a disclosure influences the persuasive effect of the sponsored content. A model is proposed in which sponsorship disclosure enhances the recognition of sponsored television content as advertising, which leads to critical processing of the sponsored content. Ultimately, this negatively affects the attitude toward the brand in the sponsored content. This model was supported, but only when the disclosure was displayed prior to or concurrent with the sponsored content. These effects were not found for a sponsorship disclosure shown at the end of the program after the sponsored content. Theoretically, the findings emphasize the importance of disclosure timing. A disclosure displayed prior to or concurrent with the sponsored content, primes the sponsored content and provides sufficient processing time, so viewers recognize the content as advertising and can process it critically. In addition, the findings show that persuasion knowledge and critical processing are important underlying mechanisms for the effect of sponsorship disclosure on brand attitude. Regarding the practical implications for legislators and advertisers, this research demonstrates that sponsorship disclosure can make viewers aware of the sponsored content in television programs. Furthermore, this changes the processing of sponsored content and can also ultimately lead to resistance against persuasion.     

法兰西创业孵化面面观

在科技创新与产业化领域,法国在世界上一直处于非常重要的地位,其高科技产业的竞争优势尤其体现在电子、微电子、计算机、生物及农业等方面。该国的科技创新项目通常应用于创新企业,而随着科技创新单位与企业相互协调合作能力的不断强化,行业的发展变得更加迅猛,同时也促进了传统工业的发展和现代化进程。     

Nash equilibrium in games with incomplete preferences

Summary. This paper investigates Nash equilibrium under the possibility that preferences may be incomplete. I characterize the Nash-equilibrium-set of such a game as the union of the Nash-equilibrium-sets of certain derived games with complete preferences. These games with complete preferences can be derived from the original game by a simple linear procedure, provided that preferences admit a concave vector-representation. These theorems extend some results on finite games by Shapley and Aumann. The applicability of the theoretical results is illustrated with examples from oligopolistic theory, where firms are modelled to aim at maximizing both profits and sales (and thus have multiple objectives). Mixed strategy and trembling hand perfect equilibria are also discussed.Received: 22 September 2003, Revised: 24 June 2004, JEL Classification Numbers: D11, C72, D43.I would like to thank Jean-Pierre Benôit, Juan Dubra, Alejandrio Jofre, Debraj Ray, Kim-Sau Chung and the seminar participants at NYU and at the Universidad de Chile for their comments. I am most grateful to Efe Ok, for his comments, criticism, suggestions and questions.     

A set optimization approach to utility maximization under transaction costs

A set optimization approach to multi-utility maximization is presented, and duality results are obtained for discrete market models with proportional transaction costs. The novel approach allows us to obtain results for non-complete preferences, where the formulas derived closely resemble but generalize the scalar case.