A Water Bank Game with Fishy Externalities

This article describes a classroom game used in a minicourse on economics for Environmental Studies students. The game, inspired by the operation of the Idaho Water Bank and the rising importance of water rights trades in the region, features a double oral auction in which farmers sell diversion rights and hydroelectric companies buy them. The increased in-stream flows create external benefits for fly fishers, who participate in the game in later rounds. The game can illustrate the role of markets in allocating resource use rights, and the effects of external benefits, free riding, and price ceilings.     

Industrial Companies' Evaluation Criteria in New Product Development Gates

This article presents the results of a study on the evaluation criteria that companies use at several gates in the NPD process. The findings from 166 managers suggest that companies use different criteria at different NPD evaluation gates. While such criteria as technical feasibility, intuition and market potential are stressed in the early‐screening gates of the NPD process, a focus on product performance, quality, and staying within the development budget are considered of paramount importance after the product has been developed. During and after commercialization, customer acceptance and satisfaction and unit sales are primary considerations. In addition, based on the performance dimensions developed by Griffin and Page (1993), we derive patterns of use of various evaluative dimensions at the NPD gates. Our results show that while the market acceptance dimension permeates evaluation at all the gates in the NPD process, the financial dimension is especially important during the business analysis gate and after‐market launch. The product performance dimension figures strongly in the product and market testing gates. The importance of our additional set of criteria (i.e., product uniqueness, market potential, market chance, technical feasibility, and intuition) decreases as the NPD process unfolds. Overall the above pattern of dimensions' usage holds true for both countries in which we collected our data, and across firms of different sizes, holding different market share positions, with different NPD drivers, following different innovation strategies, and developing different types of new products. The results also are stable for respondents that differ in terms of expertise and functional background. The results of this study provide useful guidelines for project selection and evaluation purposes and therefore can be helpful for effective investment decision‐making at gate‐meetings and for project portfolio management. We elaborate on these guidelines for product developers and marketers wishing to employ evaluation criteria in their NPD gates, and we discuss directions for further research.     

Rich and poor before the Industrial Revolution: a comparison between Java and the Netherlands at the beginning of the 19th century

This paper examines disparities in the level of economic development at the beginning of the 19th century, comparing between the Netherlands and Java. A detailed reconstruction of GDP and purchasing power parities shows that before the Industrial Revolution Java’s GDP per capita was about a third of the level of the Netherlands, confirming Angus Maddison’s estimates. Disparities in real wages were much smaller, however, for skilled laborers real wages on Java were higher than in the Netherlands. This paradox arises because the structure of the economy and the distribution of income of both countries was very different.     

欧盟：把CSR定义成可持续发展的重要支柱

面对经济全球化和日益激烈的市场竞争，欧盟希望能够同时推动经济繁荣与社会公正。欧盟已经采纳的发展战略被称为“里斯本战略”，这一战略旨在将环境挑战转化为经济增长，使环境、经济和社会三方面达到最优化平衡。中国政府强调经济发展和社会繁荣相互依存。因此我们说，中国和欧盟的发展理念是相通的。以此为基础，欧盟和中国在劳动就业和社会问题方面的政策对话也取得了很大进展。     

Instrumental variable estimation based on grouped data

The paper considers the estimation of the coefficients of a single equation in the presence of dummy intruments. We derive pseudo ML and GMM estimators based on moment restrictions induced either by the structural form or by the reduced form of the model. The performance of the estimators is evaluated for the non-Gaussian case. We allow for heteroscedasticity. The asymptotic distributions are based on parameter sequences where the number of instruments increases at the same rate as the sample size. Relaxing the usual Gaussian assumption is shown to affect the normal asymptotic distributions. As a result also recently suggested new specification tests for the validity of instruments depend on Gaussianity. Monte Carlo simulations confirm the accuracy of the asymptotic approach.     

Evaluation Periods and Asset Prices in a Market Experiment

We test whether the frequency of feedback information about the performance of an investment portfolio and the flexibility with which the investor can change the portfolio influence her risk attitude in markets. In line with the prediction of myopic loss aversion (Benartzi and Thaler (1995)), we find that more information and more flexibility result in less risk taking. Market prices of risky assets are significantly higher if feedback frequency and decision flexibility are reduced. This result supports the findings from individual decision making, and shows that market interactions do not eliminate such behavior or its consequences for prices.     

Labour with different types of skills and jobs as production factors

Summary A Cobb-Douglas production function with labour of three different levels of education is proposed. The quantity of labour with primary education is defined as the number of people having jobs requiring primary education plus the number of people with primary education who actually have jobs requiring secondary education, the latter being given a weight above one. An analogous definition applies to the quantity of labour with secondary education, where some people will actually have jobs requiring either second or third-level schooling. A simple model where utility functions developed elsewhere are also involved is used to determine the income distribution over levels of education and jobs for given numbers of labourers with primary and secondary education. Doubling the number of those with second and thirdlevel schooling will reduce income differences to about one half. It affords the Board of Editors great pleasure to publish this paper by one of their members. This gives the Board the opportunity, also on behalf of the readers ofDe Economist, to congratulate Professor Tinbergen most cordially upon his 70th birthday, which he celebrated on 12th April, 1973.     

The economics of joint ventures in centrally planned and labor-managed economies

The paper analyzes the allocational and distributional issues connected with the operation of joint ventures by firms in Yugoslavia, several Eastern European countries and the People's Republic of China with Western firms. A variable-bargaining-power model is used to examine the behavior of joint ventures under the various institutional circumstances of these countries. Contrary to Brada's conclusions (J. Comp. Econ.1(2):167–181, June 1977), the present study indicates that the behavior of joint ventures in most of these countries is likely to be quite similar.     

Professional HRM Practices in Family Owned‐Managed Enterprises*

This study examines determinants of professional human resource management (HRM) practices within a sample of approximately 700 small to medium‐sized firms. Predictions from the agency theory and the resource‐based view of organizations lead to alternate hypotheses regarding the direct and indirect negative effects of family ownership and management on the usage of professional HRM practices. Results support predictions for both direct and indirect effects. These indirect effects occur through intermediary variables that reflect organizational complexity, such as firm size, (the presence of a) formal business plan, and HRM specialization. The findings lend partial support to both theories.