The effect of HIV on health care in sub‐Saharan Africa

This article is concerned with the hitherto neglected area of the effect of HIV on the delivery of health care in sub‐Saharan Africa. The task is hampered by a lack of usable data. In most countries there have been no sentinel HIV surveys, so we have no clear idea of the magnitude of the epidemic. However, it is certain that HIV will alter the demand for health care, and the supply and quality of services.

Demand will grow as infected adults and children seek care. Most HIV‐related illness is found in people who would not normally require care, and therefore creates additional demand. Demand for care will also be determined by the availability and accessibility of services. Ironically, the middle‐income countries may face higher bills, and in this sense the effect of the HIV epidemic may be worse in the more developed world.

The supply of services will be affected by increased morbidity and mortality among health care workers. This is already happening. The generous terms and conditions of service that most governments offer to workers in the public sector will make the problem worse.

HIV has served to improve the quality of health care in most of the developed world. Patients have sought to take control over their own care, and staff have been more rigorous in taking universal precautions. But in developing countries external aid often determines how health care is organised, and money spent on AIDS is diverted from other areas. This may also be true of local funding.

The effect of HIV on health care is lamentably under‐researched. This is particularly worrying as the effects of HIV will be felt first by the health care sector. The problem must be confronted urgently from the point of view of the suppliers of health care services, the users, and the policy‐makers.     

Sparen und Einkommensverteilung

Summary The wage and salary bill in Austrian manufacturing industry is divided into a fixed and a variable part on the assumption that wages of skilled labour and salaries can be regarded as fixed, wages of unskilled and semi-skilled workers as variable cost. The excess of value added (factor incomes) over the variable wage cost (gross profit) is shown to be more stable in the trade cycle than the excess of value added over the total wage cost (net profit); this accords with the idea of a relatively stable mark-up on variable cost.As a proportion of value added, gross profit and even more net profit in the above sense decline gradually over the period 1956 to 1972. This would indicate a declining degree of monopoly or increasing degree of competition which presumably applies mainly to the export markets. The hypothesis is advanced that more active competition has taken place in foreign markets which enabled Austrian manufacturing to increase its share in those markets. The reduction in profit margins was made possible by tax allowances i.e. by the quick write-off a considerable part of new investment. This tax allowances amounts to an interest free government loan to the investor, which in fact will not be repaid of the depreciation funds are reinvested immediately after the equipment is fully written off. The proportion of the industry's capital which is in this sense financed by the government increases over time as investment expands; a profit rate has to be earned only on the remaining capital stock, so that without reduction of the return on private capital the profit margins may be reduced. (The tax allowances thus amount to a virtual reduction of the capital coefficient which proceeds gradually over a long time.)The paper finally shows the relation between the share of savings and the share of corporate incomes in the total private income during the cycle. The share of saving moves with the cycle and this is made possible by a shift to corporate income.     

Employment and growth in an aging society: a simulation study for Austria

In this study we use a long run macroeconomic model for Austria to simulate the effects of aging on employment, output growth, and the solvency of the social security system. By disaggregating the population into six age cohorts and modelling sex specific participation rates for each cohort we are able to account for the future demographic trends. Apart from a baseline scenario, we perform three alternative simulations that highlight the effects of aging from different perspectives. These include (1) purely demographic developments, (2) increasing labour market imperfections, and (3) higher economic growth due to a productivity shock.     

Structural change, Engel's consumption cycles and Kaldor's facts of economic growth

Non-linear Engel-curves for consumer goods cause continuous structural change. Goods are sequentially introduced starting out as a luxury with high income elasticity and ending up as a necessity with low income elasticity. Although this leads to rising and falling sectoral employment shares, the model exhibits a steady growth path along which the Kaldor facts are satisfied. Extending the basic model to the case of endogenous product innovations shows that complementarities between aggregate and sectoral growth may give rise to multiple equilibria.     

The Impact of Capital Market Integration on Educational Choice and the Consequences for Economic Growth

This paper examines the impact of capital market integration on higher education and the link to economic growth. The analysis takes into account that participation in higher education is non‐compulsory and depends on individual choice. Due to capital–skill complementarity, integration increases (reduces) the incentives to participate in higher education in capital‐importing (‐exporting) economies, all other things equal. From a national policy point of view, public education expenditure should increase after integration of similar economies in order to attract mobile capital. Using foreign direct investment as a measure of capital flows, we present empirical evidence which largely confirms our main hypothesis: an increase in net capital inflows in response to capital market integration raises participation in higher education. In addition, we show that the adjustment in educational attainment is an empirically relevant channel through which capital inflows foster economic growth.     

Monitoring risk in a ruin model perturbed by diffusion

We construct a nonparametric sequential test for the ruin probability and a corresponding change-point test in a risk model perturbed by diffusion. Some limiting properties are derived, which extend and improve on recent results of Conti (Stat Prob Lett 72:333–343, 2005) and Jahnke (Diploma thesis, University of Cologne, 2007). It is shown that the monitoring procedures can be designed such that the tests have an asymptotic prescribed false alarm rate (size) α and power 1. Some results from a small simulation study are also presented.     

Introduction: Exchange Rates, Capital Flows, and Commercial Policies in Transition Economies

Exchange rate movements in all transition economies have followed a similar time path, with a sharp depreciation followed by gradual real appreciation. Such a time path is rather surprising given the differences in monetary and real shocks that these countries have encountered. This introduction and this symposium examine critically whether this time path of the exchange rates can be viewed as a gradual approach to these countries' equilibrium exchange rates and whether we can deduce these equilibrium exchange rates from purchasing power parity exchange rates computed for these countries.J. Comp. Econom.,December 1998, 26(4), pp. 613–620. Arizona State University, Tempe, Arizona 85287-3806     

Ex Ante Impact Assessment under Imperfect Information: Biotechnology in New Member States of the EU

Some argue that the lack of modern agricultural development in the former socialist countries of Central and Eastern Europe has made cutting‐edge biotechnology attractive. However, enthusiasm for planting genetically modified (GM) crops varies greatly in the enlarged European Union (EU) and especially among the New Member States (NMS); the Czech GM maize area is progressively growing whereas Hungary imposed a de facto ban on GM crops. Remarkably, the Hungarian ban was not supported by any cost–benefit assessment. In the literature, ex ante impact assessments of monopolistically priced technologies are often based on cross‐sectional comparisons of average cropping budgets. Such assessments ignore heterogeneity of farmers and underestimate the true impact of these technologies because of homogeneity bias. Therefore, we propose an improved method by explicitly modelling farmer heterogeneity under imperfect information, and assess the potential value and benefit sharing of GM crops in the two NMS using a stochastic partial equilibrium model. The total potential value of GM crops is estimated at €82 million for both countries, of which €60 million (73%) accrues to farmers and €22 million (27%) to the gene developers and the seed industry. This is in line with the literature on global benefit sharing of first‐generation GM technologies.