Overturning Mundell: Fiscal Policy in a Monetary Union

Central to ongoing debates over the desirability of monetary unions is a supposed trade-off, outlined by Mundell (1961) : a monetary union reduces transactions costs but renders stabilization policy less effective. If shocks across countries are sufficiently correlated, then, according to this argument, delegating monetary policy to a single central bank is not very costly and a monetary union is desirable.
This paper explores this argument in a setting with both monetary and fiscal policies. In an economy with monetary policy alone, we confirm the presence of the trade-off and find that indeed a monetary union will not be welfare improving if the correlation of national shocks is too low. However, fiscal interventions by national governments, combined with a central bank that has the ability to commit to monetary policy, overturn these results. In equilibrium, such a monetary union will be welfare improving for any correlation of shocks.     

Impediments to Exports in Small Transition Economies

MOCT-MOST: Economic Policy in Transitional Economies -     

Technical entrepreneurship: what do we know?

The factors influencing the birth of new, high-technology firms have been investigated in a number of separate studies. This paper summarizes and reports upon this research. New, technologically-based firms have had, in the aggregate, substantial economic impact. The birth of these companies has been concentrated in particular places and at particular times. The decision to found a new company appears to be influenced by three major factors. The characteristics of the entrepreneur, including the many aspects of his background which make him more or less inclined toward entrepreneur-ship, are important. The organization for which he has been working, which might be termed ‘the incubator organization’ also influences the entrepreneurial decision in various ways. A third factor consists of a complex of external influences, including the availability of venture capital and the collective attitudes toward entrepreneurship. Feedback processes appear to be at work such that past entrepreneurship makes future entrepreneurship more likely.     

New Industrial Financial Services: What Distinguishes the Winners

Robert Cooper and Ulricke de Brentani report the results of their study of firms participating in the industrial financial services industry. Using a self-administered questionnaire, they obtained data on 56 successful and 50 failed products and found that success and failure are strongly associated with eleven important dimensions: synergy, product/market fit, quality of execution of the launch, unique/superior product, quality of execution of marketing activities, market growth and size, service expertise, quality of execution of technical activities, quality of service delivery, quality of execution of pre-development activities, and the presence of tangible elements of the service offering. They report some surprises, including their observation that while new to the firm, products entail more risk than "close to home" ones, the resulting level of success is not sharply reduced.     

Group selection and the evolution of altruism

‘Group selection’ is an oft-cited but controversialexplanation for the survival of altruism. Rather than enterthis debate, this paper asks whether a group structure alonecan provide a reasonable explanation for the survival of altruisticbehaviour in an evolving population. If altruism (defined astaking a cooperative action in a standard Prisoners' Dilemma)is to flourish, either groups need to be isolated from one anotherfor multiple generations, or groups need to be constructed ina positively-assortative manner. Concentrating on the formercase the paper shows that the size of the group, the relativebenefit to cost of altruism and the number of generations inisolation all play a critical role. The smaller the group size,or the larger the benefit-to-cost ratio, the higher the survivalchances of altruism. Additionally, for altruism to survive,the number of generations spent in isolated groups must be neithertoo big nor too small.     

Land reform and rural development in the Transvaal

This paper considers and contrasts agriculture on the white‐owned farms and in the black‐occupied areas of the Transvaal. It outlines the limitations of the existing tribal tenure system in the black areas, and argues that the various development initiatives that have taken place there have not left the people either financially better off, or with a greater degree of control over their land than before. The whole Transvaal should be seen as a single unit for agricultural planning purposes. This would mean that natural resources, as well as agricultural services, could be spread more equitably among the entire population of the area, which would boost agricultural production, as well as lessen the gross inequalities currently pertaining between black and white agriculture in the area.     

Female Managers in Britain – A Comparative Perspective

The aim of this article is to present the current position of female managers in Britain and examine the similarities and differences between male and female managers. In terms of managerial efficiency and performance per se, the evidence strongly suggests that there are far more similarities than differences between the way men and women ‘manage’. However, there are some major sex differences in relation to demographic profiles, job status and employment factors, career development, occupational stress levels, and attitudes towards female managers compared to their male counterparts. One in nine managers in Britain are women and less than one per cent occupy senior management positions. Women managers tend to have to be more highly qualified than men managers, are more likely to be single or divorced, and encounter more prejudice and discrimination in the work environment. In addition, compared to male managers female managers have to cope with additional stresors stemming both from their work and home lives. It is suggested that many of these differences are hampering the career prospects of women in management and contributing towards the difficulties they have in reaching the higher levels of management compared to men. Finally, recommendations for changes in corporate and legislative policies are also proposed.     

Patient empowerment strategies for a safety net

The Milwaukee County General Assistance Medical Program implemented strategies to improve the delivery of care to its patients that include patient education and a Nurse Telephone Line. The partnership between a county-funded program and an academic health center has been very productive and resulted in improvements to the program that benefit underserved patients. The outcomes of these educational strategies are described.     

Cooperation without Reputation: Experimental Evidence from Prisoner's Dilemma Games

This paper investigates cooperative play in prisoner's dilemma games by designing an experiment to evaluate the ability of two leading theories of observed cooperation: reputation building and altruism. We analyze both one-shot and finitely repeated games to gauge the importance of these theories. We conclude that neither altruism nor reputation building alone can explain our observations. The reputation model is inconsistent with play in both one-shots and finitely repeated games while the model with altruism is unable to explain observed play in the finitely repeated games.Journal of Economic LiteratureClassification Numbers: C72, C92.