The mixed economy for public service consumers. The case of consumer agencies for public transportation

The phrase mixed economy of welfare refers to the observation that the provision of public services in western countries frequently involves the participation of other sectors in addition to government. For example, a service may be privately financed and produced but regulated by government, financed by government subsidies or vouchers but produced privately, or produced by a commercial or voluntary organization under contract to government. But such different ways in which government can arrange public service supply by no means exhaust the varieties of arrangements in a mixed economic system. Other examples include alternative institutional arrangements for articulating consumer wants for public services, evaluating consumer satisfaction, and holding the producers of services accountable for their performance.This paper examines the role of official public advisory bodies and private, voluntary associations whose purposes are to improve services to users of U.S. public transportation. At variance with some of the theory of political economy, it is found that the public and private consumer organizations generally enjoy a symbiotic rather than substitute or competitive relationship with one another, and that both kinds of organizations arise and complement each other in addressing the problems of consumers of a government service produced under monopoly conditions.

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Die Beteiligung mehrerer Wirtschaftssektoren bei der Versorgung mit öffentlichen Diensten — der Fall der amerikanischen Verbraucher-Agenturen für öffentlichen Nahverkehr

Zusammenfassung Der Ausdruck mixed economy of welfare bezieht sich auf die Beobachtung, daß die Versorgung mit öffentlichen Gütern in westlichen Ländern häufig nicht allein durch den Staat erfolgt. So kann zum Beispiel ein öffentliches Gut privat finanziert und hergestellt werden, aber unter öffentlicher Aufsicht stehen, oder es kann von der öffentlichen Hand bezahlt aber privat produziert werden, oder es kann durch eine kommerzielle oder gemeinnützige Organisation in Absprache mit staatlichen Stellen produziert werden. Ebenso gibt es Fälle, wo öffentlicher und privater Hersteller eines vergleichbaren Gutes verschiedene Marktseggmente versorgen. Beispielsweise stehen in den USA den Bürgern, die mit öffentlichen Schulen unzufrieden sind, private Schulen zur Verfügung.Diese Beispiele zeigen, auf welchen unterschiedlichen Wegen die Versorgung mit öffentlichen Gütern rangiert werden kann. Solche angebotsorientierten Beispiele zeigen aber nur einen Teil der möglichen Sektorverbindungen in einer Mischwirtschaft. Andere Beispiele treffen eher die Nachfrageseite bei öffentlichen Gütern, insbesondere die institutionellen Möglichkeiten für die Artikulation von Verbraucherwünschen hinsichtlich öffentlicher Güter für die Erfassung der Zufriedenheit und dafür, daß die Anbieter öffentlicher Güter für ihr Leistungsniveau einstehen müssen. Solche Beispiele zeigen, daß Einrichtungen wie Kommissionen für öffentliche Dienste, Departements für Konsumentenfragen, Ombudsmänner und eine Vielzahl privater und freiwilliger Organisationen in unterschiedlichster Weise tätig werden, um die Interessen von Bürgern zu schützen, die öffentliche Leistungen in Anspruch nehmen.Der vorliegende Beitrag betrachtet solche Einrichtungen für öffentlichen Nah- und Fernverkehr in den USA. Ebenso wie in England gibt es hier sowohl offizielle öffentliche Beratungsgremien wie auch private freiwillige Einrichtungen, deren Zielsetzung ganz ähnlich sind, nämlich die Leistungen der öffentlichen Verkehrsunternehmungen zu verbessern. Der Beitrag berichtet über die Ergebnisse einer empirischen Studie beider Arten von Gremien und versucht die Rolle beider Arten in einer Mischwirtschaft zu beschreiben. Insbesondere versucht der Beitrag, zu erklären, warum beide Arten von Gremien entstehen, welches Verhältnis sie zu einander und zu den Transportunternehmen haben. Im Gegensatz zu manchen theoretischen Annahmen erwies sich, daß öffentliche und private Verbraucherorganisationen weniger in einem substitutiven oder wettbewerblichen Verhältnis zueinander stehen, sondern eher eine Symbiose miteinander bilden, und daß sich beide Arten von Organisationen häufig bei der Behandlung von Problemen ergänzen.The author is indebted to his former student and research assistant Chester Phillips for carrying out the survey for this paper. He would also like to thank his colleague Richard Silkman for insightful comments and suggestions on the first draft and Beverly Dolinsky of the Permanent Citizens Advisory Committee to the MTA in New York City for the time and information she provided. Finally, the author wants to thank Ken Judge for providing the stimulus to write this paper through the invitation to participate in the 1983 Social Administration Association Conference in Canterbury, England, where this paper was first presented, and Harry Weiner for arranging support to allow attendance at that conference.

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Dennis R. Young is a Professor at W. Averell Harriman College for Policy Analysis and Public Management, State University of New York at Stony Brook, Stony Brook, New York 11794, USA.     

Do converters facilitate the transition to a new incompatible technology? A dynamic analysis of converters

This paper analyzes the process of transition in standards between incompatible technologies when converters are available. Contrary to a common presumption that converters facilitate the transition from an old technology to an otherwise incompatible new technology, I find circumstances in which the possibility of transition is blockaded by the existence of converters. In the welfare analysis of converters, a distinction is made between ex ante and ex post efficiency effects. Finally, I also analyze the equilibrium behavior in the provision of converters and compare it to the socially optimal outcome.     

Real estate return correlations: Real-world limitations on relationships inferred from NCREIF data

Correlation estimates for returns between individual properties are subject to large inherent uncertainties due to limits on the amount of data that is likely to be available for the foreseeable future. After allowance for correlation sampling error, it is impossible to distinguish on an ex ante basis between the risk-reduction capabilities of mean-variance portfolio selection models and naive diversification without regard to property type or geographical location. The naive portfolio diversification strategies of typical institutional real estate portfolio managers are rational responses to limitations on the informational content of statistical analyses of historical real estate data.     

The effectiveness of interest-rate futures contracts for hedging Japanese bonds of different credit quality and duration

This study investigates the effectiveness of the Tokyo Stock Exchange (TSE)-traded Japanese 10-year JGB futures contract to hedge portfolios of Japanese bonds of differing maturity and credit quality. The bond portfolios examined are Government, AAA-, and AA-rated Eurobonds with maturities of 2, 3, 5, 7, 10, and 20 years. Consistent with the recent literature, the study employs univariate methods for calculating hedge ratios based on levels, first differences, and percentage change of each series. Out-of-sample forecasting is used to determine the effectiveness of the calculated hedge ratios for each of the bond portfolios and to determine which approach to calculating hedge ratios is the most effective. The results show that this particular futures contract does provide a good hedge, particularly for those bond terms closest to the 10-year term of the contract. There is some evidence, although not strong, that JGBs are better hedged than AAA and AA bonds. Investors should take some caution when using this futures contract to hedge bond portfolios of different maturities and credit ratings.     

Enterprise Risk Management and the Cost of Capital

Enterprise risk management (ERM) is a process that manages all risks in an integrated, holistic fashion by controlling and coordinating any offsetting risks across the enterprise. This research investigates whether the adoption of the ERM approach affects firms' cost of equity capital. We restrict our analysis to the U.S. insurance industry to control for unobservable differences in business models and risk exposures across industries. We simultaneously model firms' adoption of ERM and the effect of ERM on the cost of capital. We find that ERM adoption significantly reduces firm's cost of capital. Our results suggest that cost of capital benefits are one answer to the question how ERM can create value.     

Competitive pricing strategies in social networks

We study pricing strategies of competing firms selling heterogeneous products to consumers. Goods are substitutes and there are network externalities between neighboring consumers. In equilibrium, firms price discriminate based on the network positions and charge lower prices to more central consumers. We also show that, under some conditions, firms' equilibrium profits decrease when either the network becomes denser or network effects increase. In contrast, consumers always benefit from being more connected to each other. We determine the optimal network structure and compare uniform pricing and discriminatory pricing from the perspectives of firms and consumers.     

Marriage between credit cards and the Internet: Buying is just a click away!

This paper examines whether Internet access positively affects credit card balances. To that end, we compare the 2010 and 2013 Surveys of Consumer Finances, analyze the consistency of the results over time, and provide the rationale for any resulting differences. Using the censored techniques, our results indicate that Internet access has a positive effect on credit card balances, which suggests that consumers with Internet access are prone to higher balances compared to those without. The probability of carrying positive balances was larger in 2010 compared to 2013. Overall, the results suggest that, while the financial crisis might have contributed to higher balances in 2010, the economic recovery afterward seems to have eased the burden of credit card debt.     

Board of Directors and CSR in Banking: The Moderating Role of Bank Regulation and Investor Protection Strength

This paper brings together research on boards of directors as the backbone of corporate governance and corporate social responsibility (CSR) practices in the banking industry. The underlying idea is that some characteristics of bank boards, in particular independence and gender diversity, may impact the CSR commitments of banks. By making use of a sample of 159 banks in nine countries during the period 2004–2010, our empirical evidence suggests that banks with more independent directors and more female members on their boards incline toward socially responsible behaviour. Our results also suggest that institutional factors play a significant role in these effects. They show that in greater regulatory and stronger investor protection environments, board independence and gender diversity have more influence on the social behaviour of banks.     

IFRS Adoption in Emerging Markets: The Case of Jordan

The aim of this study is to research the adoption of International Financial Reporting Standards (IFRS) in Jordan, which was one of the first Middle Eastern emerging economies to adopt IFRS. The paper investigates the related factors that pressure and prevent such adoption over time, and illustrates the developmental aspects of such adoption. An interpretive methodology is employed, and perceptions of the study's participants are analysed regarding the adoption of IFRS in Jordan, which is an area that is under researched. Semi‐structured interviews were undertaken to collect Jordanian experts’ perceptions. Based on the empirical data analysis and prior theoretical and empirical literature, an adoption model was developed, which can serve future studies as well. The model illustrates the paradox of accounting changes in emerging economies, in which the actual conditions that pressure IFRS adoption are also the conditions that prevent full adoption. The model also provides an explanation of the implementation process of IFRS in emerging economies at both country and corporation levels. It combines practical features and related theories in an integrative model seeking to explain the phenomenon of IFRS as a new accounting regulation change.