Trust and social efficiencies

In a variant of the repeated prisoner's dilemma, if extra costs are associated with the verifications built into strategies that could otherwise produce Pareto efficient equilibria, the attainment of efficient play becomes problematical. Evolutionary-game versions of this dilemma are studied here in an attempt to understand the difficulties societies face in maintaining efficient interactions mediated by trust.     

A Philosophical Framework for Case Studies

People who teach business ethics seem locked between two general approaches: an applied philosophy approach that emphasizes the application of abstract ethical theories and principles to specific cases, and the case method approach that leaves the students without any more general theoretical framework with which to approach ethical issues. Classical American Pragmatism, understood as a school of philosophical thought, links these two approaches by providing a new grounding for moral theory in which moral rules are understood as working hypotheses abstracted from concrete situations and moralreasoning demands the return to concrete situations as the foundation for moral decision making that is inherently contextual. Thus moral decision making is bottom up rather than top down, and a sense of moral rightness comes not from the indoctrination of abstract principles but from attunement to the way in which moral beliefs and practices must be rooted naturally in the very conditions of human existence.     

Technology and Business: Rethinking the Moral Dilemma

In a market economy, the corporation is the primary institution through which new technologies are introduced. And the corporation, being primarily interested in economic goals, may ask very limited questions about the safety and workability of a particular technology. This viewpoint causes problems which manifest themselves in many cases where the concerns of engineers and technicians in corporations about decisions relating to a particular technology clash with managers prone to overlooking these concerns in favor of organizational interests. The problem can be seen as a structural one that is inherent in the capitalistic system. It can also be seen as an organizational or policy problem that requires changes in the organization to give engineers more authority in decision-making or to facilitate whistle-blowing on the part of engineers or technicians. In this paper, we take the view that problems surrounding the misuse of technology lie in a lack of understanding of technology's inherently social and moral dimensions. Technology creates a moral situation, and this situation should provide the context for decision-making. Technology is also experimental, and everyone involved with introducing a particular technology needs to ask the question as to whether a real life experiment is warranted. Finally, technology demands a moral sensibility which recognizes that business interests and technological interests alike need to be understood in the network of concrete relational contexts in which they are embedded.     

Implications of Seasonal Climate Forecasts on World Wheat Trade: A Stochastic, Dynamic Analysis

Improvements in seasonal climate forecasts have potential economic implications for international agriculture. A stochastic, dynamic simulation model of the international wheat economy is developed to estimate the potential effects of seasonal climate forecasts for various countries' wheat production, exports and world trade. Previous studies have generally ignored the stochastic and dynamic aspects of the effects associated with the use of climate forecasts. This study shows the importance of these aspects. In particular with free trade, the use of seasonal forecasts results in increased producer surplus across all exporting countries. In fact, producers appear to capture a large share of the economic surplus created by using the forecasts. Further, the stochastic dimensions suggest that while the expected long‐run benefits of seasonal forecasts are positive, considerable year‐to‐year variation in the distribution of benefits between producers and consumers should be expected. The possibility exists for an economic measure to increase or decrease over a 20‐year horizon, depending on the particular sequence of years. Le progrès des prévisions saisonnières du climat a une portée économique pour l'agriculture internationale. Un modèle stochastique et dynamique de l'économie internationale du blé est développé afin d'estimer les effets potentiels des prévisions saisonnières du climat sur la production de blé de divers pays, leurs exportations et le commerce mondial. Les études précédentes ont généralement ignoré les aspects stochastiques et dynamiques des effets liés à l'utilisation des prévisions climatiques. Cette étude montre l'importance de ces aspects. En particulier avec le libre échange l'utilisation de ces prévisions aboutit à l'augmentation des excédents dans tous les pays exportateurs. En fait, il apparaît que les producteurs accaparent une grande part de l'excédent économique créé par l'utilisation de ces prévisions. De plus, les dimensions stochastiques suggèrent que bien que les bénéfices à long terme des prévisions climatiques puissent être substantiels, on s'attend à des variations considérables d'une année à l'autre dans la distribution des bénéfices entre les producteurs et les consommateurs. Il est possible qu'un indicateur économique varie à la baisse sur 20 ans eus fonction de la séquence de variation climatique.     

Agenda control in an unstable multiparty parliamentary democracy: evidence from the Israeli public sector

As elected politicians’ knowledge, information and expertise about the policy process decrease, so will their ability to control it and to independently shape its agenda. When elected politicians spend less time in their positions due to cabinet instability, they will have less knowledge about policy issues in comparison to career bureaucrats. Multiparty parliamentary systems are characterized by cabinet instability, hence increasing the likelihood of this phenomenon. Indeed it has been shown that in these systems the bureaucracy is the main player in the policy process. This paper illustrates this phenomenon in the Israeli context, a clear example of a multiparty democracy with an unstable cabinet and a dominant bureaucracy.     

Language, Agglomeration and Hispanic Homeownership

As of the fourth quarter of 2007, 74.9% of white non-Hispanic families but only 48.5% of Hispanic families owned homes. We argue that low rates of homeownership in Hispanic communities create a self-reinforcing mechanism that contributes to this large disparity. In part, this occurs because proximity to other homeowners belonging to a family's social network improves access to information about how to become a homeowner. Role model effects may also be relevant. We investigate these issues using household-level data on out-of-state movers from the 2000 Decennial Census. Three especially important results are obtained. First, proximity to Hispanic homeowners in the 1995 place of residence increases the propensity of a Hispanic family to own a home in 2000. Second, that effect is especially strong with respect to proximity to weak English-speaking Hispanic homeowners. Third, these patterns hold regardless of the Hispanic family's own ability to speak English. From a policy perspective, these results suggest that local programs designed to promote homeownership among weak English-speaking Hispanic families likely increase Hispanic homeownership beyond just the immediate program participants.     

Participation and the provision of discrete public goods: a strategic analysis

This paper considers the Nash equilibria to a game where a discrete public good is to be provided. Each individual may participate by making a fixed contribution. If a sufficient number of contributions are made, the good is provided. Otherwise, the good is not provided. One variant of the rules allows for contributions to be refunded when the good is not provided. For pure strategies, we find that the Nash equilibria with a refund are a superset of those without a refund. For both rules, the efficient number of players contributing is an equilibrium. For mixed strategies, to every equilibrium without a refund there is a corresponding equilibrium with a refund with a higher number of expected contributors. Mixed strategy equilibria ‘disappear’ as the number of players grows large. Some results reported in the experimental literature are discussed in light of these theoretical results.     

The Boom,the Bust and the Future of Homeownership

This article investigates the boom and bust in U.S. homeownership rates over the 2000–2010 period. Using individual‐level census data, we first estimate 204 homeownership regressions stratified by household age (21, 22, …, 89) and survey year (2000, 2005 and 2009). Shift‐share methods confirm that changes in the model coefficients that reflect household attitudes, lending standards and other market conditions—but not population socioeconomics—were the primary driver of the boom and bust in homeownership over the decade. This pattern holds for nearly all age groups and is more pronounced for recent movers. Results also suggest that homeownership rates may have come close to bottoming out in early 2013 at 65% after falling roughly four percentage points from their peak in 2006. This suggests little lasting effect of the grand homeownership policy experiment of recent decades.