Abstracts

Quality & Quantity -     

Accounting for the effect of health on cross-state income inequality in India

We perform development accounting in accordance with [Weil, 2005] and [Weil, 2007] in a cross-state analysis of India. Results of similar magnitude are found, demonstrating that health can account for 1% to 18% of income differences depending on the health measure.     

Climate Change,Innovation, and Economic Growth: The Contributions of William Nordhaus and Paul Romer

ABSTRACT

William Nordhaus and Paul Romer shared the 2018 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel for their work on long-run macroeconomic analysis. Nordhaus adapted the neoclassical growth model to study climate change, while Romer developed a model of innovation-based growth. The authors provide two distinct explanations of what drives growth, and employ contrasting methodologies for interpreting the results of their mathematical models. Macroeconomic policy in general, and climate policy in particular, would benefit from better integrating the theory and methods of these two laureates.     

“Want to” Versus “Have to”: Intrinsic and Extrinsic Motivators as Predictors of Compliance Behavior Intention

“Worthless,” “money burning,” or “black holes” is how media and professionals describe compliance practices today. Practitioners are unenthusiastic about control systems, codes of conducts, and systems for compliance management that are increasing in volume but not in effectiveness. In order to help practitioners clarify what actually makes employees comply with their compliance program, this study examines intrinsic and extrinsic motivators of 119 employees from procurement and sales. We contribute to the existing motivation literature, testing the self‐determination theory in low and high hierarchical levels. Our findings show that intrinsic motivators are more strongly and positively related to compliance intention on higher hierarchical levels than the lower ones. However, employees from higher hierarchies show overall less compliance intention than employees from lower hierarchies. © 2015 The Authors. Human Resource Management published by Wiley Periodicals, Inc.     

No progressive taxation without discrimination? On the generality of the law in the classical liberal tradition

Any liberal theory that would take seriously the question of equality before the law is bound to engage with discrimination-related matters, and so long as one is a liberal one should oppose all discrimination coming from the state. This, however, may be a double-edged sword since many classical liberals have quite readily opposed progressive taxation by invoking its discriminatory nature. Some liberals will therefore conclude that one cannot establish different tax brackets, lest taxation be illiberal. This paper endeavours to refute this assumption. Progression may be compatible with the classical liberal concern for the rule of law, provided legislative discretion on tax-related matters is duly limited by the principle of generality, as well as by a certain standard of reasonable lawmaking. Through a careful distinction between four concepts of differential treatment, this paper demonstrates that progressive tax arrangements do not necessarily discriminate against the well-off, and that it can efficiently fulfill some legitimate classical liberals objectives.     

Early exercise of American put options: Investor rationality on the Swedish equity options market

Using Swedish equity option data, this study investigates how well the actual exercise behavior of American put options corresponds to the early exercise rules. The optimal exercise strategy is established in two ways. First, the critical exercise price, above which a put option should be exercised early, is computed and compared to the actual exercise price. Second, the exercise value of the option is compared to its market bid price. The results show that most early exercise decisions conform to rational exercise behavior, even though a large number of failures to exercise are found. Most of the faulty exercises can also be discarded after a sensitivity analysis, although several failures to exercise are considered irrational, even after taking transaction costs into account. © 2000 John Wiley & Sons, Inc. Jrl Fut Mark 20:167–188, 2000     

Formulating standards for sustainable forest management in Canada

Over the past decade, but particularly in the years since Rio, many initiatives have surfaced in the name of sustainable forest management (SFM). There is now a growing literature recognizing new techniques in timber labelling and the certification of sustainable management systems. However, they have not yet been located adequately in wider political contexts, such as the new (non-governmental) approaches to regulatory compliance or the new corporate response to the western environmental movement. This article examines a leading SFM framework in Canada, known as the Z808 initiative. Co-ordinated by the Canadian Standards Association (CSA), it advances a system of standards pertaining to sustainable forest management. As a politically-driven process to translate the concepts and practices of sustainable resource management into a concrete form, the CSA experience is very revealing. The article reviews the origins and the parameters of the Z808 system. This is followed by a commentary and critique of the system, centred on four dimensions: the pivotal role of the management system approach, the treatment of sustainability as a conceptual goal, the enclosure of the public interest, and the underlying convergence of business and state interests within this third-party certification approach. In the case of Z808, the most crucial political choices have been made already, and the operational logic of the system can be clearly discerned. © 1997 John Wiley & Sons, Ltd and ERP Environment.     

Likelihood-based inference for cointegration with nonlinear error-correction

We consider a class of nonlinear vector error correction models where the transfer function (or loadings) of the stationary relationships is nonlinear. This includes in particular the smooth transition models.     

A theory on the role of wholesalers in international trade based on economies of scope

This paper offers a theoretical foundation for the existence of wholesalers and other intermediaries in international trade and analyzes their role in an economy with heterogeneous manufacturing firms and fixed costs of exporting. Wholesalers are assumed to possess a technology such that they can buy manufacturing goods domestically and sell in foreign markets and they can, unlike manufacturers, export more than one good. A wholesaler therefore faces an additional fixed cost, which increases in the number of goods it handles. The presence of wholesale firms leads to productivity sorting. The most productive firms export on their own by paying a fixed cost, but a range of firms with intermediate productivity levels export through international wholesalers. A higher fixed cost of exporting to a destination means that wholesalers handle: (i) a higher share of total export volumes to this destination and (ii) a higher share of the exported product scope (i.e., the number of exported products) to this destination. A higher fixed cost of exporting gives wholesalers a larger role, since these can spread the fixed cost across more than one good. The wholesale technology therefore exhibits economies of scope. An empirical analysis using Swedish firm‐level data supports the main assumption and predictions of the model.