Nash equilibrium reconsidered and an option for maximin

In this paper we will discuss some peculiarities of the Nash equilibrium which are at odds with its standard applications: (a) the underlying dynamic interpretation, (b) the incentive independency if equilibria are mixed, and (c) the unprofitability if equilibrium and maximin are mixed and the game is 2-by-2. Maximin is proposed as an alternative solution concept in “relevant situations”.     

The Structure of Protection in Indonesia in 1989 1

Around the mid-1980s, Indonesia's protectionist regime supported an industrial structure in which industries were mainly oriented towards producing for the domestic market. Since then, trade policies have shifted to a more outward-looking strategy, stimulating the growth and diversification of non-oil manufactured exports. This paper attempts to quantify the nominal and effective rates of protection resulting from trade policies at the end of the 1980s. After an introduction in which the 1989 trade policies are discussed, estimates of nominal and effective rates of protection are presented. It is shown that though the level of protection has declined since 1987, it still varies widely across economic sectors. Furthermore, despite the more open trade strategy, the paper's findings show that the trade regime remains biased against exports. Finally, by examining some trade policy issues, the paper presents further ways of rationalising the structure of protection in Indonesia's industrial sector.     

Optimal Collective Investment in Generic Advertising, Export Market Promotion and Cost-of-Production-Reducing Research

Optimal investment rules are developed for a producer agency investing in domestic-market generic advertising, export market promotion, and cost-of-production-reducing research. These rules are derived assuming either maximization of producers' surplus or social surplus. The form of the optimality rules differs according to which objective is pursued. Fixed producer agency budgets are also allowed by incorporating a constraint limiting total expenditure on the three activities. Addition of such a constraint substantially alters the structure of the optimal investment rules. Differences in these rules highlight the importance of accounting for the financing mechanism when modeling optimal checkoff fund investment decisions. Optimality rules are simulated using data for the Canadian beef sector. Results suggest historic underinvestment in domestic-market generic advertising but overinvestment in export market promotion. Sensitivity of simulation results underscores the difficulty in assessing optimality of historic producer investment in cost-of-production-reducing research.     

Financing budget deficits in the Netherlands

Summary In The Netherlands public debt management is in the hands of the budgetary policy-maker, whose recourse to the capital market can exceed or fall short of the total borrowing requirement in order to absorb or create liquidity. The conduct of that policy since the early 1960's is analyzed in this paper, emphasizing the importance of medium-term control over the public finances as a prerequisite for the ability of debt management to make a flexible contribution to monetary policy. During the 1960's this condition was satisfied and debt management followed a stable countercyclical pattern which, however, was abandoned after the early 1970's as the public finances swung into substantial disequilibrium.The author thanks J. Boughton, L. Bovenberg, D. Hendry, P. Masson, J. Muellbauer, and the referees for comments on earlier versions. However, the views expressed are his alone and do not necessarily represent those of the International Monetary Fund.     

Protection versus Promotion: An Empirical Investigation

Using Turkish industry-level data from 1983 to 1990, we find that politically organized industries receive both higher protection and promotion than unorganized ones. Tariff rates are decreasing (increasing) in the import-penetration ratio and the absolute value of the import-demandelasticity for organized (unorganized) industries. Subsidy rates are decreasing (increasing) in the output-supply elasticity for organized (unorganized) industries. The results are consistent with the predictions of the Grossman–Helpman model and its extension in this paper. The mix of protection and promotion is inversely related to the ratio of their respective marginal deadweight cost measures.     

在衰退中成长

如今,全球都笼罩在经济衰退之中.如果下一个就要轮到贵公司,你该怎么办?当然你要尽力保证企业财务的稳定.但更重要的是,你还必须了解公司在衰退结束后的目标设计.如果你知道企业的发展方向和如何实现这一目标,那么衰退时期是改善公司相对战略地位的好时机.