Experimental investigation of stationary concepts in cyclic duopoly games

We experimentally test the predictive success of three stationary concepts in two cyclic duopoly games. The concepts are Nash equilibrium, impulse-balance equilibrium and payoff-sampling equilibrium. In the experiment 11 independent subject groups, consisting out of six participants interacting over 200 rounds, were gathered for each game. The comparison of the three concepts with mixed strategies shows that the order of performance from best to worst is as follows: payoff-sampling equilibrium, impulse-balance equilibrium, and Nash equilibrium. In addition the data exhibit a weak but significant tendency over time in the direction of coordination at a pure strategy equilibrium.     

The pattern of changes in the long-term development of establishment size

Hypotheses and analyses dealing with the expansion of small businesses are usually carried out over relatively short periods of time. The patterns drawn from these examinations, e.g., on the question of specific differences in the growth of size, are usually influenced by configurations of the overall economy and limit the realization of regular processes to the phases they are based upon. A second disadvantage lies in most cases in the fact that data sources are used for the empirical analyses that do not cover the economic system as a whole nor for all sizes of establishments. This study attempts to present the development of the sizes of establishments in Germany over a period of more than one hundred years (1882 to 1987) and thus avoids the narrow perspective of previous examinations. It becomes evident that this development does not take a continuous course; instead, it follows a wave pattern. Since this discontinuous development pattern is common to almost all sectors, it appears to be a general phenomenon. This study reveals that the small establishments with more than five employees, contrary to most theoretical assumptions, are of utmost importance even when considered over a long period of time. The growth of small establishments in recent years, observable in all sectors, may not be a unique phenomenon; however, in view of an overall growth of employment and the simultaneous shrinking of large establishments, it occurs under a new constellation.     

Commitment and coordination in a dynamic game model of international economic policy-making

In this paper, we consider a dynamic game model of two identical countries. Policy-makers of both countries have quadratic intertemporal objective functions and want to stabilize domestic output, domestic inflation, and the real rate of exchange. We present different analytical and numerical solutions for this policy game. Noncooperative open-loop equilibria are interpreted as requiring unilateral commitment and policy-makers' credibility. Potential gains from cooperation are present, as the noncooperative equilibrium solutions are not Pareto-optimal. Under an information pattern that admits memory strategies, the possibility of obtaining cooperative results without coordination and commitment arises.     

Stabileres Tarifvertragssystem durch Stärkung der Allgemeinverbindlicherklärung?

The declaration of the general binding of collective agreements plays a minor role in Germany compared to other European countries. In particular, the number of extended wage agreements has declined greatly over the last two decades. Because of the declining bargaining coverage, calls for a stabilisation of the collective bargaining system are increasing. In this context, the greater use of the extension mechanism could play an important role. This article analyses the historical development of the instrument and explains different proposals for reforming the extension mechanism put forward by political parties and trade unions.     

Strategic step-by-step negotiation

We analyze a specific type of negotiation process where parties proceed in stages taking into consideration that negotiation may end prematurely with an inefficient agreement. Parties negotiate only one increasing pie, thereby avoiding inefficiencies which are typical for issue-by-issue negotiations. For ann-stage game, we prove the existence of a unique subgame-perfect equilibrium. We then show that step-by-step negotiation can only improve players' expected payoffs if negotiation in stages reduces the difference between their equilibrium offers. For this to occur, however, the risk of negotiation must be affected by the agenda of the bargaining problem.     

Einzelbesprechungen

Ohne Zusammenfassung     

A pre-history of misesian calculation: The contribution of adolphe thiers

Conclusion Mises’s argument on the impossibility of economic calculation under socialism, first proposed in 1920, has forerunners. One of the early forerunners was Adolphe Thiers in his book De la propiété, which was published in 1848. Thiers understood that he was fighting for the case of the economists against socialists and communists. He wrote a popular book after the socialist revolution of 1848 putting forward an eloquent defense of property as the foundation of society. Although largely neglected, his work is interesting because he based economic argument on a property-rights framework and because he already hinted towards the problem of economic calculation under socialism. The particular force of his argument lies in the refutation of economic calculation under socialism not only on grounds of practicability, but of a theoretical reasoning about the role of property and thus the role of the market and prices for the allocation of goods. Being himself a politician he was compromising in the application of his own principles, which makes especially the last part of his book, On Taxation, contradictory in view of the preceding parts. Thiers’s argument can be interpreted as resulting from the tradition of the natural-law school of the Physiocrats, who could themselves draw on the Catholic tradition of natural law and the discussion of the “just price.” a libertarian think-tank to promote the Austrian School in Germany.