The Millennium Peak in Club Convergence: A New Look at Distributional Changes in The Wealth of Nations

This paper proposes an easy‐to‐use nonparametric indicator for club convergence, or convergence within clusters of countries: it measures whether the modes of the gross domestic product (GDP) per capita distribution become more pronounced over time. Relying on changes in the critical bandwidth for unimodality, the indicator is a dynamic extension of concepts from often‐used multimodality tests. Its evolution suggests the new empirical result of a ‘millennium peak’ in club convergence in the worldwide GDP per capita distribution. The club convergence movements of the 1980s and 1990s, when groups of poor and rich countries converged to two separate points, was followed by a de‐clubbing movement after the turn of the millennium. Copyright © 2016 John Wiley & Sons, Ltd.     

Parametric Lorenz Curves and the Modality of the Income Density Function

Similar looking Lorenz curves can imply very different income density functions and potentially lead to wrong policy implications regarding inequality. This paper derives a relation between a Lorenz curve and the modality of its underlying income density: given a parametric Lorenz curve, it is the sign of its third derivative which indicates whether the density is unimodal or zeromodal (i.e., downward‐sloping). The density modality of several important Lorenz curves such as the Pareto, Weibull, Singh–Maddala parametrizations and hierarchical families of Lorenz curves are discussed. A Lorenz curve performance comparison with Monte Carlo simulations and data from the UNU–WIDER World Income Inequality Database underlines the relevance of the theoretical result: curve‐fitting based on criteria such as mean squared error or the Gini difference might lead to a Lorenz curve implying an incorrectly‐shaped density function. It is therefore important to take into account the modality when selecting a parametric Lorenz curve.     

Platform Owner Entry and Innovation in Complementary Markets: Evidence from Intel

This paper explores Intel's strategy with respect to complements. We find that, as the literature predicts, Intel's entry decisions are shaped by the belief that it does not have the capabilities to enter all possible markets, and thus that it must encourage widespread entry despite the fact that potential entrants (rationally) fear Intel's ability to "squeeze" them ex post. We explore the ways in which Intel addresses this issue, highlighting in particular the firm's use of organizational structure and processes as commitment mechanisms. Our results have implications for our understanding of the dynamics of competition in complements and of the role of organizational form in shaping competition.     

Same Work,Different Pay? Evidence from a US Public University

Abstract

This study examines detailed data for faculty at a typical public research university in the United States between 1995 and 2004 to explore whether gender wage differentials can be explained by productivity differences. The level of detail – including the number of courses taught, enrollment, grant dollars, and number and impact of publications – largely eliminates the problem of unmeasured productivity, and the restriction to one firm eliminates unmeasured work conditions that confound investigations of wider labor markets. The authors find that direct productivity measures reduce the gender wage penalty to about 3 percent, only 1 percentage point lower than estimates from national studies of many institutions and with fewer productivity controls. The wage structure for women faculty differs markedly from the wage structure for men. Interpreted against the institutional features of wage setting for this population, the paper concludes that penalties for women arise at the department level.     

CUTTING CARBON EMISSIONS AT A PROFIT (PART I): OPPORTUNITIES FOR THE UNITED STATES

This article identifies and corrects shortcomings in recent modeling studies on the economics of reducing greenhouse gas emissions in the United States. The major assessments of the Kyoto Protocol—by the U.S. Energy Information Administration, the Clinton White House Council of Economic Advisers, the U.S. Department of Energy Interlaboratory Working Group, and the Stanford Energy Modeling Forum—are found to be seriously incomplete. Each study omits one or several of four major cost-reducing policy options, resulting in cost estimates that are far too pessimistic.
In the present study, these shortcomings are overcome through the integrated evaluation of all major cost-cutting policy options within a coherent least-cost framework. Three domestic policies—a national carbon cap and permit trading program, productivity-enhancing market reforms and technology programs, and recycling of permit auction revenues into economically advantageous tax cuts—are combined with international emissions allowance trading.
This analysis shows that an integrated least-cost strategy for mitigating U.S. greenhouse gas emissions would produce an annual net output gain of roughly 0.4% of GDP in 2010 and about 0.9% of GDP in 2020. On a cumulative net present value basis, the United States would gain $250 billion by 2010 and $600 billion by 2020. International flexibility mechanisms (including emissions trading) are of only secondary significance in realizing these productivity, output, and welfare gains.     

Re-exploring the relationship between flexibility and the external environment

The organizational structure literature has long posited that increases in uncertainty should lead to organic (adaptable) structures [T. Burnes, G.M. Stalker, The Management of Innovation, Tavistock Publications, London, 1961]. Similarly, the operations management literature has focused on the importance of flexibility as a competitive weapon [e.g., [De Meyer et al., 1989] Strategic Manage. J. 10 (1989) 135], and as a response to environmental uncertainty [Manage. Sci. 33 (1987) 509; Manage. Sci. 39 (1993) 395]. However, our recent attempts to empirically validate a relationship between environmental uncertainty and operational flexibility in manufacturing plants have failed to show a significant relationship [J. Operations Manage. 3 (1999) 307]. The present research attempts to rectify these contradictory findings by replicating and extending the works of [Manage. Sci. 33 (1987) 509] as well as [J. Operations Manage. 3 (1999) 307]. The results find no support for the proposition that firms that respond to increased uncertainty with increased flexibility will experience increased performance.     

CARBON REDUCTION COSTS IN NEW ENGLAND'S POWER SECTOR

This paper examines the cost of reducing carbon emissions in New England's power sector. The analysis relies on detailed sectoral studies of costs and resource potentials for demand-side efficiency, cogeneration, renewables, and conventional resource options. Sectoral studies' results were integrated using a production-cost model to estimate the total cost and rate impacts of carbon reduction strategies relative to a business-as-usual forecast. To capture potential uncertainties, the analysis takes into account variations in capital costs, fuel prices, resource utilization levels, and base case retirements of existing power plants. Results show that New England's power sector can freeze carbon emissions at current levels or reduce carbon emissions while simultaneously decreasing customers' total electricity bills.