What Is Fair? Experimental Evidence

There has been growing interest within the economics discipline in the role of equity concerns in the distribution of resources. This paper presents empirical evidence from controlled laboratory experiments where third-party decision makers allocate resources between two individuals. The experimental results indicate that subjects view a wide range of different allocations as the fair distribution of resources. However, regression analysis indicates that both treatment effects and a few demographic variables explain some of this variation in fairness concepts. Most significantly, decision makers rewarded subjects who earned their favorable positions, and the gender of the decision maker was an important predictor of the allocation chosen.     

Long- and short-term interest rates in 19 countries: Tests of cointegration and parameter instability

This paper examines the long-run relationship between short-term and long-term interest rates (both nominal and real) in 19 countries, and explores the possibility that the relationship is statistically stable using Lc, MeanF, and SupF statistics suggested by Hansen [1992]. Empirical results obtained from various cointegration techniques (Johansen, Phillips and Hansen, Stock and Watson, and Park) and quarterly data (1973–1998) show considerable support for the expectations hypothesis in all countries (except the United Kingdom). In a majority of cases, it is also found that a stable relationship exists between the short-term and long-term interest rates.     

Extracting the information: espionage with double crossing

This paper addresses two very old issues in human society: espionage and double crossing. Our major conclusion points out that there will be a serious over rewarding problem in the direct mechanism due to double crossing in espionage, and a competitive mechanism with a relative performance regime can possibly mitigate the over rewarding problem and still extract the information.      

The teaching of ethics in management accounting: progress and prospects

Recent research has shown that, although still on a limited scale, the teaching of business ethics in UK higher education has been increasing in recent years. This paper reports on a postal questionnaire survey conducted to investigate the extent to which ethical issues are covered in the teaching of management accounting in higher education. The principal findings are that the majority of management accounting lecturers in the British Isles do not incorporate ethics. About a third of the respondents to the survey do address ethical issues, although about half of those say they do so only implicitly. Various factors underlying the findings and prospects for the future are discussed.     

Background Risk and the Performance of Insurance Markets under Adverse Selection

Background risk can influence the performance of insurance markets that must deal with adverse selection when applicants are risk vulnerable, since they are more averse to bearing the insurable risk as a result of their exposures to background risk. We show that background risk always results in a lower deductible for the incentive constrained contract, and that a broader range of markets attains the stable sequential equilibrium cross-subsidized pair of separating contracts. We conclude that background risk always improves the performance of markets for coverage against (insurable) foreground risks that must deal with adverse selection. We also find, however, that these improvements are never sufficient to offset the cost to insureds of bearing the background risk.     

Harmonizing the interests of a city and its region: Krasnoyarsk krai experience

The paper focuses on the emerging system of territorial strategic planning in the constituent entities of the Russian Federation and municipalities. Suggested for practical application are the best Russian research studies and practices of coordinating the interests of municipal and regional authorities. The analysis of scholarly approaches to the issue in focus allows one to infer that the best elaborated position is that of the staff of the North-Western Office of the Russian Research Center for Local Governance (RRCLG). As regards the express-analysis of practices adopted in the number of the Russian Federation constituent entities, the practices of the Krasnodar krai appear to be the most promising.     

Extending working hours: why not work 42 h rather than 38?—a CGE analysis for Germany

Faced with a record level of unemployment, the present debate in Germany is to extend the weekly hours of work. In this paper the employment effects of an economy-wide increase in weekly hours are quantified on the basis of a computable general equilibrium model for different specifications of the wage setting rule and the use of additional policy-induced public income. The simulation results back the argument of the opponents of longer working time that not more jobs will be created. However, when the higher tax revenues from GDP growth are used to reduce social security contributions, then the claim of the proponents that more jobs will be created can be supported.     

Domestic Support and Border Measures for Processed Horticultural Products

In horticultural markets, trade barriers often apply to the processed products whereas domestic support applies to farm-produced raw commodities. Here we assess the effects of such trade barriers and domestic support by simulating the effects of policy reform on global processing tomato markets, which are faced with modest processed product tariffs and high domestic support in the European Union (EU). Both protection and EU subsidy drive down world welfare, but we find that reducing import tariffs for tomato products would yield greater effects on markets and larger welfare impacts outside Europe than would reductions in EU domestic support.