Modeling the Role of a Coordinator as a Medium of Communication in 2-Player Conflicts

This paper discusses the role of a coordinator in the 2-player conflict where the information on players' preference is incomplete. It is assumed that the coordinator has a priori prospect of feasible alternatives. First, the method of the graph model for conflict resolution (GMCR) is extended to apply to this conflict with incomplete information, and the coordination system for the conflict with incomplete information is proposed. The process operated by the coordinator uses Extended Robustness Analysis that specifies the critical conditions for the stability and Pareto efficiency of an alternative. Finally, the methodology is applied to the conflict between hydropower generation and environmental interests.     

Repeated Games with Bounded Entropy

We investigate the asymptotic behavior of the maxmin values of repeated two-person zero-sum games with a bound on the strategic entropy of the maximizer's strategies while the other player is unrestricted. We will show that if the bound η(n), a function of the number of repetitions n, satisfies the condition η(n)/n → γ (n → ∞), then the maxmin value Wⁿ(η(n)) converges to (cav U)(γ), the concavification of the maxmin value of the stage game in which the maximizer's actions are restricted to those with entropy at most γ. A similar result is obtained for the infinitely repeated games. Journal of Economic Literature Classification Numbers: C73, C72.     

VAT and the taxation of rents

Cash-flow corporate taxes can tax corporate-source rents and avoid some of the distortions on investment and financing caused by conventional corporate taxes. However, cash-flow taxes applied on an origin basis are prone to international profit-shifting, which can lead to a competitive reduction in tax rates. While this can be avoided by a destination-based cash-flow tax, most countries have opted for origin-based taxation, asserting the right to tax rents generated within their jurisdictions. Since a value-added tax (VAT) implicitly includes rents in its base, it can complement origin-based corporate taxation. We compare and contrast the use of destination and origin VATs as complements to an origin-based cash-flow corporate tax.     

Prior health expenditures and risk sharing with insurers competing on quality

Insurers can exploit the heterogeneity within risk-adjustment classes to select the good risks because they have more information than the regulator on the expected expenditures of individual insurees. To counteract this cream skimming, mixed systems combining capitation and cost-based payments have been adopted that do not, however, generally use the past expenditures of insurees as a risk adjuster. In this article, two symmetric insurers compete for clients by differentiating the quality of service offered to them according to some private information about their risk. In our setting it is always welfare improving to use prior expenditures as a risk adjuster.     

A Reassessment of Marx's Thought on Labour Exchange

This article reassesses Marx's thought on labour exchange and illuminates its worth. In the Grundrisse and subsequent pre-Capital writings, Marx presented arguments that attached importance to worker subjectivity towards labour performance based on the distinction between labour capacity and labour. This afforded insights into the peculiarities of labour exchange that preclude market determination of wages and other working conditions and necessitate the intervention of class struggle and other socio-political factors in their settlement. The significance of Marx's perspective is further elucidated when compared with the classical tradition and the position of neoclassical economics. Although his emphasis on worker autonomy receded in Capital, his earlier arguments on labour exchange, it is posited, remain highly relevant to understanding industrial relations in today's capitalist economy.     

The Efficiency Principle in Non-Cooperative Coalitional Bargaining

Applying the non-cooperative theory of coalitional bargaining, I examine a widely held view in economic literature that an efficient outcome can be agreed on in voluntary bargaining among rational agents in the absence of transaction costs. While this view is not always true, owing to the strategic formation of subcoalitions, I show that it can hold under the possibility of successive renegotiations of agreements. Renegotiation may, however, motivate bargainers to form a subcoalition first and to exploit the first-mover rent. This strategic behaviour in the process of renegotiation may distort the equity of an agreement.
JEL Classification Numbers: C72, C78, D23, D61, D63.     

The effects of female HIV/AIDS status on fertility and child health in Cambodia

Although Cambodia has been on a higher growth track, it still faces a great challenge in public health. Public health is closely related to the standard of living of the people and is indispensable for further economic development. This paper considers a serious public health problem, the HIV/AIDS epidemic in Cambodia. Specifically, it presents two testable hypotheses derived from a simple model and then empirically demonstrates these hypotheses, using data of more than 8000 women from the 2005 Cambodia Demographic and Health Survey (DHS). One hypothesis is the negative effect of female HIV on fertility, and the other is the positive effect of maternal HIV on child health status. Our estimation results are consistent with these hypotheses, implying that women infected with HIV tend to bear fewer children and their children are in better health.     

Competition and productivity in Japanese manufacturing industries

This paper examines the determinants of productivity in Japanese manufacturing industries, looking particularly at the impact of product market competition on productivity. Using a newly available panel data on around ten thousand firms in Japanese manufacturing for the years 1994–2000, I show that competition, as measured by lower level of industrial price–cost margin, enhances productivity growth, controlling for a broad range of industrial and firm-specific characteristics. Moreover, I suggest that market power, as measured by either individual firm's price–cost margin or market share, has negative impact on productivity level of R & D performing firms. J. Japanese Int. Economies 19 (4) (2005) 586–616.     

Use of Joint Consultation Committees by Large Japanese Firms

In Japanese union-employer relations, managers of large firms often make use of the Joint Consultation Committee (JCC) system in order to avoid disputes with labour. This study first describes two such uses of the system, namely information-sharing and pre-Shunto (Spring Offensive) wage discussions. It then examines several economic, institutional and operational correlates of these uses. The results indicate that information-sharing is a function of firms' operational structure, whereas the likelihood of pre-Shunto wage discussions responds to short-term changes in firms' economic performances as well as to institutional and operational factors.     

Revisiting the Böhm-Bawerk–Edgeworth Controversy: Early Neoclassical Economists and Labour Exchange

This article revisits the controversy between Böhm-Bawerk and Edgeworth. The crux of this debate revolving around value and cost lay in their views on labour exchange. Böhm-Bawerk and Edgeworth did not disagree on the basic principles underlying the causality between labour exchange and value-cost. Böhm-Bawerk stressed a decisive influence of social power relationships on labour time and Edgeworth apparently agreed. Böhm-Bawerk’s and Edgeworth’s observations on actual industrial relations and their theoretical arguments informing the controversy had variances. Such observation–theory discrepancies also appeared in their other work and were shared by other early neoclassical economists. Their efforts, with this contradiction, contributed to the moulding of a principle that de-individuates labour exchange. At the root of this process lay the fact that, despite their subjectivist approach, they failed to comprehend the distinctiveness of capitalistic labour exchange arising from worker subjectivity towards labour performance and employer countermeasures. The Böhm-Bawerk–Edgeworth controversy typically illustrates this crucial moment for the establishment of the neoclassical paradigm.