WHAT ATTRACTS FOREIGN DIRECT INVESTMENT: A CLOSER LOOK

It is rational to assume that minimal trade barriers (tariffs and quotas), a bigger trade sector, lower interest rate regulations, freer international capital market, lower credit and labour market regulations will make investment in a country more lucrative for foreign investors. We confirm this and show the prevalence of non-linearity in the relationships.     

Land reform and agricultural productivity in India: a review of the evidence

In this paper we review as well as contribute to the empiricalliterature on the impact of land reform on agricultural productivityin India. We find that, overall for all states, land-reformlegislation had a negative and significant effect on agriculturalproductivity. However, this hides considerable variation acrosstypes of land reform, as well as variation across states. Decomposingby type of land reform, the main driver for this negative effectseems to be land-ceiling legislation. In contrast, the effectof tenancy reform, averaged across all states, is insignificant.There seems to be a wide range of state-specific effects, whichsuggests that focusing on average treatment effects can hidea considerable amount of heterogeneity. In particular, allowinga separate slope for West Bengal, one of the few states thatimplemented tenancy laws rigorously, we find that land reformhad a marginal positive effect relative to the rest of India.     

Stop holding yourself back

After working with hundreds of leaders in a wide variety of organizations and in countries all over the globe, the authors found one very clear pattern: When it comes to meeting their leadership potential, many people unintentionally get in their own way. Five barriers in particular tend to keep promising managers from becoming exceptional leaders: People overemphasize personal goals, protect their public image, turn their competitors into two-dimensional enemies, go it alone instead of soliciting support and advice, and wait for permission to lead. Troy, a customer service manager, endangered his job and his company's reputation by focusing on protecting his position, not helping his team; when a trusted friend advised him to change his behavior, the results were striking. Anita's insistence on sticking to the tough personal she'd created for herself caused her to ignore the more intuitive part of the leadership equation, with disastrous results--until she let go of the need to appear invulnerable and reached out to another manager. Jon, a personal trainer who had virtually no experience with either youth development programs or urban life, opened a highly successful gym for inner-city kids at risk; he refused to be daunted by his lack of expertise and decided to simply "go for it." As these and other examples from the authors' research demonstrate, being a leader means making an active decision to lead. Only then will the workforce--and society--benefit from the enormous amount of talent currently sitting on the bench.     

Do Potential Skilled Emigrants Care about Political Stability at Home?

In this paper, we consider the role of political stability in the source country as a potential reason for skilled emigration. We control for all prospective source country characteristics, and yet skilled emigration is seen to be driven by a relatively better situation of political stability in the home country. Our research clearly shows that government stability, socioeconomic conditions, investment profiles, democratic accountability, internal conflict, and ethnic tensions in source nations have significant impacts on the rate of skilled emigration for a sample of developed and developing countries. The results retain robustness even for a subset of only developing nations.     

Variety,Globalization, and Social Efficiency

The standard formal presentation of the Dixit‐Stiglitz‐Krugman (DSK) model of monopolistic competition with a constant‐elasticity‐of‐substitution (CES) utility function supposes a sufficient number of firms so that the elasticity of demand facing each variety is approximated by a constant elasticity of substitution. Such a formulation forces economies of scale to be frozen so that firm size never changes. We use a Bertrand‐Nash interpretation of the equilibrium that allows the elasticity of demand facing each variety to depend on the number of varieties, thus allowing the gains from globalization to reflect both the increase in variety and the exploitation of economies of scale. We also develop a precise expression for per capita real income with any number of sectors and examine the age‐old question of the socially optimal number of varieties.     

Robust min–max portfolio strategies for rival forecast and risk scenarios

We consider an extension of the Markowitz mean–variance optimization framework to multiple return and risk scenarios. It is well known that asset return forecasts and risk estimates are inherently inaccurate. The method proposed provides a means for considering rival representations of the future. The optimal portfolio is computed, simultaneously with the worst case, to take account of all rival scenarios. This is a min-max strategy which is essentially equivalent to a robust pooling of the scenarios. Robustness is ensured by the noninferiority of min–max. For example, a basic worst-case optimal return is guaranteed in view of multiple return scenarios. If robustness happens to have too high a cost, guided by the min–max pooling, it is also possible to explore other pooling alternatives. A min–max algorithm is used to solve the problem and illustrate the robust character of min–max with return and risk scenarios. We study the properties of the min–max risk–return frontier and compare with the potentially suboptimal worst-case where the investment strategy and the worst case are computed separately.     

On sustained economic growth with wealth effects

In a discounted one-sector convex model of optimal economic growth where utility may depend on both consumption and capital stock, I derive necessary and sufficient conditions for sustained growth (unbounded expansion of capital and consumption). Conditions for bounded growth and extinction are also outlined. Optimal paths may be non-monotone. Sustained growth may occur even though the asymptotic marginal productivity is less than the discount rate and may require the initial capital stock to be above a critical level. The behavior of the marginal rate of substitution between consumption and capital plays a crucial role in the conditions.     

Adverse selection in group insurance: The virtues of failing to represent voters

Compared with non-union workers, union workers take more of their compensation in the form of insurance. This may be because unions choose democratically, and democratic choice mitigates adverse selection in group insurance. Relative to individually-purchased insurance, we show that group insurance chosen by an ideal profit-maximizing employer can be worse for every employee, while group insurance chosen democratically can be much better. The reason is that democracy can fail to represent the preferences of almost half the group.Received: January 2003, Accepted: September 2004, JEL Classification: J51, D82, G22     

A Study on the Indian Information Sector: An Experiment with Input-Output Techniques

It is widely recognized that rapid changes in information technology (IT) are bringing about major structural changes in the economies of the world. Information flexibility, product quality and fast response are the key factors for global competition and IT plays a critical role in these areas. Policy-makers in industrialized and developing countries view IT as a critical infrastructure to enhance their access to global knowledge, markets and capital. These views--of IT as infrastructure and as core capability for development--resonate with India's aspirations to modernize its infrastructure, transform its industry and join the global economy. Realizing the huge potential of the Indian IT industry, we make an attempt in this paper to study the extent of informatization in the Indian economy during the period 1983-84 to 1989-90 and try to identify the information intensive sectors. This paper also studies the sources of growth of the information sectors of India during 1983-84 to 1989-90 with the help of a structural decomposition analysis (SDA).     

Leadership,Creative Problem‐Solving Capacity,and Creative Performance: The Importance of Knowledge Sharing

This article presents two studies that examine whether leader supportive behaviors facilitate knowledge sharing and employee creative problem‐solving capacity, thereby enhancing creative performance. The findings from both studies indicate that leader supportive behaviors are directly and indirectly related, through both internal and external knowledge sharing, to employee creative problem‐solving capacity. In addition, creative problem solving was related to the two dimensions of creative performance—fluency and originality. However, a test of the mediation model indicated that creative problem solving only mediated the relationship between internal knowledge sharing creative performance and originality. These findings highlight the complex process by which leaders facilitate both internal and external knowledge sharing and employee creative problem‐solving capacity, thereby improving employee creative performance.