Inequality foundations of concentration measures: An application to the Hannah-Kay indices

The aim of this paper is to provide a connection between concentration and inequality. In particular, we show that the general entropy inequality indices are, among inequality measures, those consistent with the whole set of Hannah-Kay concentration indices. We isolate the inequality component underlying concentration measures, obtaining an explicit additive decomposition of the change in concentration into the change in its two components, i.e., inequality and the number of firms. This relationship proves to be valid for the whole set of Hannah-Kay concentration indices, and embodies as particular cases some others previously found in the literature. We are particularly grateful to Emilio Cerdá for helpful comments on the mathematical formulation of the paper. The second author also acknowledges support through the European Commission Project #ERBCHRXCT980248.     

Henry George and His Philosophy: He Sought Equality of Opportunity to Use the Earth's Resources as Well as the End of Land Monopoly

Abstract . The George scholars today appear to be interesting the academic community in re-evaluating Henry George and his ideas. George, the 19th century American economist and social philosopher, dedicated himself to ending poverty by giving everyone equal access to the earth and its resources. He believed that land monopoly could be ended by taking the economic rent of all land and natural resources to meet the costs of government in lieu of taxes on labor and capital. George's writings revived interest in the ethos of the early settlers a time when sight was being lost of Pioneer America's contribution to the world's march toward freedom.     

The social cost of through traffic: Contribution to the suburban-central city exploitation thesis

This paper deals with the conflict between local and through traffic when allocating land for transportation at the expense of residential consumption. The model developed in this paper gives the optimal allocation of land between both uses, via Pontryagin's Maximum Principle, and shows the impact of through traffic on the urban structure, on local transportation costs and on the cost of housing supply. The cost functionals are used to measure the total burden to the inner city and a connection is made to the ongoing discussion of the ‘exploitation’ thesis.     

The nonobserved economy in the European Union

To better understand the share of the nonobserved economy (NOE) in the European Union, especially on the PIIGS, we estimate, through the multiple indicators multiple causes model, the path between 1980 and 2013. The model includes (i) the tax burden (disaggregated into direct and indirect taxes), a proxy of regulation burden, the unemployment rate and self-employment as causes of the NOE economy; (ii) the GDP and the labour force participation ratio as indicators of the NOE economy. In particular, the estimated weight of NOE as a percentage of official GDP was always higher in the PIIGS group.     

Can the North–South trade regime explain intra- and inter-country productivity differences?

The literature identifies North–South disparities in Total Factor Productivity (TFP), which, in turn, justify the bulk of international income differences. By building a dynamic, general equilibrium model of North–South technological-knowledge diffusion with scale-invariant growth, we extend the literature in several directions: (i) growth is driven by Schumpeterian R&D and by high and low-skilled human-capital accumulation; (ii) three trade regimes are considered; (iii) sectoral and aggregate TFP measures are computed; (iv) the extent to which the North–South trade regime explains intra-country TFP and inter-country TFP differences is evaluated. In particular, the results suggest that intra-country TFP differences increase and inter-country TFP differences fall when countries are more interdependent.     

Scientific policy and free riders

This paper presents econometric evidence of the effects of knowledge capital and institutions on technology transfer funding. A model is proposed and fitted for 31 research units on agricultural, forestry, and food sciences in Catalonia, Spain from 1990 to 1996. We find a strong impact of knowledge capital and institutional variables on technology transfer funding. Considering administrative costs strengthens the main points of the model and in some cases greatly changes the results. In particular, we reject the hypothesis that administrative costs do not matter. We also find evidence of the existence of free-rider strategies and that increasing returns-to-scale economies exist when bidding for technology transfer funding.An earlier draft of this paper was completed while the author was a visiting scholar at Iowa State University. The author is grateful to Wallace Huffman, Todd Sandler, and Simon Vicary for comments. Financial support was provided by the Interministerial Commission for Science and Technology project, SEC96-2300, and the Interdepartmental Commission for Research and Technological Innovation project, SGR97-333.     

In Defense of DEFECT

The one-state machine that always defects is the only evolutionarily stable strategy in the machine game that is derived from the prisoners' dilemma, when preferences are lexicographic in complexity. This machine is the only stochastically stable strategy of the machine game when players are restricted to choosing machines with a uniformly bounded complexity. Journal of Economic Literature Classification Numbers: C70, C72.     

INTERNATIONAL LISTINGS, THE SECURITY MARKET LINE AND CAPITAL MARKET INTEGRATION: THE CASE OF US LISTINGS ON THE LONDON STOCK EXCHANGE

This paper examines for international capital market segmentation by testing for changes (both inter-temporally and inter-beta) in the parameters of the riskreturn pricing relationship caused by the listing of US stocks on the London Stock Exchange (LSE) between 1965 and 1987. It is hypothesized that international listings reduce the negative effects associated with barriers to international investments, help integrate world markets and therefore decrease internationally listed stock's required returns. Significant negative deviations from the Sharpe-Lintner (SL) pre-listing pricing relationship during the postlisting period are therefore expected, primarily caused by decreases in the intercept parameter. We find, in support of the hypothesis, significant negative deviations from the predictions of SL for our sample, although they do not appear to have an intertemporal dimension. These deviations are largely associated both with decreases in the value of the SL model's intercept parameter and with low beta firms, and point toward some integration benefits from US listings on the LSE.     

Resource allocation, equality of access and health

Based upon the experience of Tanzania, this paper relates resource allocation in the health sector to the output of health, by contrasting access to and utilization of available health services by urban and rural populations. The writer argues that increased health expenditures alone cannot yield an efficient health care return unless the additional expenditure is spread ‘thinly’, in keeping with the realities of population distribution, transport possibilities, and disease patterns in most poor countries. Detailed data are presented for recurrent and capital expenditures for health facilities at different levels, and the output of those institutions is considered in terms of the volume of services offered. Those services are then measured according to their utilization by urban and rural populations. Because referral systems are found to function only marginally, it is argued that further building of large hospitals is not justified in the present situation of most poor countries. Specifically, the writer describes the ways in which Tanzania is changing its inefficient and unjust health care system. The paper concludes that the major obstacles to change are not shortages of resources or technologic ignorance but social systems that do not place high value upon the health care needs of rural peasants. It is in this way that the professional and elitist interests of the few are often destructive of the needs of the many.