The Role of Migration in the Variety and Quality of Trade: Evidence from Germany

We explore the migration‐trade nexus in the case of Germany over the period 2000–09, disentangling the two dimensions of intra‐industry trade (vertical and horizontal). We find that immigration is positively and significantly related to intra‐industry trade. However, the magnitude and statistical significance of migration's impact on trade are considerably higher for horizontal intra‐industry trade and increase with the difference in the level of development between Germany and the partner countries. This pattern is consistent with the view that information flows between migrant communities and their country of origin may be more important for consumer goods (where trade in varieties prevails) and that this information effect is more important if trading countries are very different.     

Food health claims – What consumers understand

Issues pertaining to consumer understanding of food health claims are complex and difficult to disentangle because there is a surprising lack of multidisciplinary research aimed at evaluating how consumers are influenced by factors impacting on the evaluation process. In the EU, current legislation is designed to protect consumers from misleading and false claims but there is much debate about the concept of the ‘average consumer’ referred to in the legislation.     

Central Bank Independence and the Cost of Disinflation: Why the Wage Contracts Length Matters?

Recent empirical contributions demonstrate that countries with less independent central banks enjoy lower output losses during disinflationary cycles. To explain these somewhat surprising empirical findings, some authors suggest that independent central banks probably face a flatter short-run Phillips curve. In this paper, we provide both theoretical and empirical arguments to rationalize this intuition. We demonstrate that, since central bank independence reduces the mean inflation rate and its variance, wage setters opt for a lower degree of nominal wage indexation leading to more wage and price inertia and, thus, to a flatter short-run Phillips curve. Consequently, this paper put forward a channel of positive influence of central bank independence on the sacrifice ratio through its impact on nominal wage indexation. Empirical tests, performed using a sample of 19 OECD countries during the 1960–1990 period, show that these theoretical results hold also empirically.     

Sociometric Status and Peer Control Attempts: A Multiple Status Hierarchies Approach

We study a population of first year midshipmen within an elite military academy to explore the relationship between individuals’ sociometric status (e.g., status conferrals based on positive interpersonal affect and perceived competence, and status degradations based on negative interpersonal affect) and their attempts to directly control their peers’ behaviour over a year's time. Results show that multiple informal sociometric status hierarchies develop early in the organization's life and remain remarkably stable. Control attempts are driven by these status hierarchies: Lower competence status individuals and those who attract negative status degradations are targeted for control by more people early in the group's life, those relatively free of negative status degradations attempt to control greater numbers of others throughout the group's existence, while higher positive status is generally unrelated to control attempts. However, control attempts do not lead to higher future sociometric status, suggesting they are not status signals. Findings also show that individuals targeted for control by many others leave the organization entirely.     

Food safety issues: From Enlightened Elitism towards Deliberative Democracy? An overview of EFSA’s “Public Consultation” instrument

Following the BSE crisis, the importance of reassuring European consumers and involving them in debate about food safety management issues is generally recognised. Indeed, consulting stakeholders is one of the European Food Safety Authority’s (EFSA) main duties, as stated in its founding regulation (art. 42, whereas 56), where EFSA must have “effective contacts with consumer representatives, producer representatives, processors and any other interested parties”. Even if not clearly obliged to, EFSA has also opted to consider lay citizens’ opinion (under an interpretation of art. 42, wh. 40 of the 178 Reg.) in order to enhance “trust” in food safety. Beyond having formally established meetings with restricted access for participants – like the Stakeholders’ Consultative Platform and the Annual Colloquium, – EFSA engages in its “Public Consultation” web-based Window (PCW). It allows listening to anybody who wishes to submit comments on technical issues.     

Equal treatment and socially optimal R&D in duopoly with one‐way spillovers

This paper examines the standard symmetric two‐period R&D model with a deterministic one‐way spillover structure: know‐how flows only from the high R&D firm to the low R&D firm (but not vice versa). Though firms are ex ante identical, one obtains a unique asymmetric equilibrium (pair) in R&D investments, leading to interfirm heterogeneity in the industry. R&D cooperation by means of a joint lab is considered and compared to the non cooperative solution. The main part of the paper provides a second‐best welfare analysis in which we show that the joint lab yields a socially optimal R&D level subject to an equal treatment (of firms) constraint, which also coincides with the noncooperative solution in the absence of spillovers. We also investigate the welfare costs of this equal treatment constraint and find that they can be quite significant.     

EFFICIENT MECHANISMS FOR MERGERS AND ACQUISITIONS*

We characterize incentive‐efficient merger outcomes when payments can be made both in cash and stock. Each firm has private information about both its stand‐alone value and a component of the (possibly negative) potential synergies. We study two cases: when transfers can, and cannot, be made contingent on the value of any new firm. When they can, we show that redistributing shares of any nonmerging firm generates information rents and provides necessary and sufficient conditions for the implementability of efficient merger rules. When they cannot, private information undermines efficiency more when it concerns stand‐alone values than synergies. Here, acquisitions emerge as optimal mechanisms.