SOUTH-SOUTH TRADE: Theory, Evidence, and Policy

Recently a number of commentators have argued that trade policyin developing countries should be deployed discriminatorilyto encourage the expansion of trade among southern countries.Such a strategy is seen as being central in the framing of anew international economic order. This article evaluates thearguments in favor of a relative expansion of South-South tradeand reviews the experience of developing countries with discriminatoryregional trading arrangements. It contends that the case forspecific policies to promote South-South trade is not convincingand that experience with discriminatory arrangements is notencouraging. The expansion of South-South trade can be expectedto continue in the context of multilateral trade expansion,and the potential gains are likely to be greater if this processis allowed to evolve freely in a multilateral setting.      

Weak and strong monotone comparative statics

Summary This paper develops necessary and sufficient conditions for the set of solutions to an optimization problem to be nondecreasing in a weak sense still strong enough to guarantee the existence of an increasing selection, and thus strong enough to guarantee monotonicity when the solution is unique, as well as necessary and sufficient conditions for the set of optimizers to be nondecreasing in a strong sense which is strong enough to rule out the possibility of a decreasing selection. These necessary and sufficient conditions are variations of quasisupermodularity and the single crossing property introduced in Milgrom-Shannon [13]. Moreover, to determine when an objective function satisfies these conditions, this paper develops several characterizations of quasisupermodularity and the single crossing property and their variants, both in terms of differential conditions and in terms of restrictions on the structure of the level sets of these functions. Several examples are given to choice theory under loss aversion and to an auction problem.I am grateful to Don Brown and Paul Milgrom for numerous helpful conversations concerning earlier versions of this paper. This paper is a revised and expanded version of the paper An Ordinal Theory of Games with Strategic Complementarities (Shannon [15]). I am pleased to acknowledge the financial support of the National Science Foundation, and an Alfred P. Sloan Foundation Doctoral Dissertation Fellowship.     

Examining the motivators of training transfer in an enterprise systems context

Enterprise systems (ES) are large software packages that have been widely adopted, but are complex to deploy. One way to obtain more value from them is to train end-users. However, little is known about the effectiveness of ES training. This study examines post-training behaviour in the ES environment through the concept of training transfer and the theoretical framework of self-determination theory. It proposes that end-users’ computer self-efficacy (CSE) and mastery orientation (MO), as well as the perceived ease-of-use (PEOU) of a system, influence their motivation to transfer the skills they have gained during training to their work environment and to use the system. Data was collected from 170 ES end-users, who had previously attended ES training, through a survey. Partial least squares modelling was used to analyse the data, and all of the hypotheses were supported. This study is among the first few studies that investigate the more distal impact of information systems training.     

Developing a ‘European’ model of human resource management

The concept of human resource management (HRM) has been much debated in the literature. Space limitations preclude an examination of that debate here, but it is clear that the concept developed initially from work in the United States of America in the 1960s and 1970s and since then has been adopted increasingly in the academic literature, by consultancy services and in organizational terminology. The terminology spread from the USA firstly into the developed English speaking world and recently - and more partially - into Europe. Is the concept, as opposed to the terminology, applicable in Europe? This paper argues that the organizational autonomy on which the subject is propounded in the United States is not espoused in Europe. A range of subject areas in which organizations in Europe are supported/constrained by external factors are analysed, thus challenging the validity of the American model. This raises the need to consider different conceptual approaches to HRM: a new model of the concept which would encompass EuroHRM is proposed.     

Cementing the case for collusion under the National Recovery Administration

Macroeconomists have long debated the aggregate effects of anti-competitive provisions under the “Codes of Fair Conduct” promulgated by the National Industrial Recovery Act (NIRA). Despite the emphasis on these provisions, there is only limited evidence documenting any actual effects at the micro-level. We use a combination of narrative evidence and a novel plant-level dataset from 1929, 1931, 1933, and 1935 to study the effects of the NIRA in the cement industry. We develop a test for collusion specific to this particular industry. We find strong evidence that before the NIRA, the costs of a plant's nearest neighbor had a positive effect on a plant's own price, suggesting competition. After the NIRA, this effect is completely eliminated, with no correlation between a plant's own price and its neighbor's cost.     

Knightian uncertainty and moral hazard

This paper presents a principal-agent model in which the agent has imprecise beliefs. We model this situation formally by assuming the agent?s preferences are incomplete as in Bewley (1986) [2]. In this setting, incentives must be robust to Knightian uncertainty. We study the implications of robustness for the form of the resulting optimal contracts. We give conditions under which there is a unique optimal contract, and show that it must have a simple flat payment plus bonus structure. That is, output levels are divided into two sets, and the optimal contract pays the same wage for all output levels in each set. We derive this result for the case in which the agent?s utility function is linear and then show it also holds if this utility function has some limited curvature.     

Hot and cold IPO markets: The case of the Stock Exchange of Mauritius

The aim of this study is to assess the characteristics of the hot and cold IPO markets on the Stock Exchange of Mauritius (SEM). The results show that the hot issues exhibit, on average, a greater degree of underpricing than the cold issues, although the hot issue phenomenon is not a significant driving force in explaining this short-run underpricing. The results are consistent with the predictions of the changing risk composition hypothesis in suggesting that firms going public during hot markets are on average relatively more risky. The findings also support the time adverse selection hypothesis in that the firms’ quality dispersion is statistically different between hot and cold markets. Finally, the study concludes that firms which go public during hot markets do not underperform those going public in cold markets over the longer term.