Hans Singer's model of the severity of recessions

This paper draws attention to the innovative but neglected workof Hans Singer on the dynamics of unemployment. Influenced byKeynes, in the late 1930s Singer enquired into the relationshipbetween the inflow into unemployment—resulting primarilyfrom (involuntary) separations from employment—and thesize of the resultant fluctuations in the level of unemployment.His focus was on the determinants of the severity—measuredin terms of how far unemployment rises—of recessions.We illustrate his approach by looking at quarterly data forthe claimant count and its associated inflow and outflow inthe UK over the period 1989–2003, a period which includesone major recession episode. In addition to drawing attentionto Singer's ideas, the paper also extends his model by takinginto account recent empirical evidence on the behaviour of oneof the key variables in his model. We argue that, with thisextension, Singer's elegant and parsimonious model of unemploymentdynamics is a useful complement to Keynes's ideas on the fluctuationsin aggregate demand and output, and is of contemporary relevance.     

Measuring wage effects of plant size

There are large plant size–wage effects in the Nordic countries after taking into account individual and job characteristics as well as systematical sorting of the workers into various plant-sizes. The plant size–wage elasticities we obtain are, in contrast to other dimensions of the wage distribution, comparable to the plant-size effects in other countries such as the U.S. with completely different institutions of wage setting. We also investigate the consequence of measurement error associated with the common practice of using midpoints of plant-size classes to estimate the plant size–wage elasticity. Our results indicate that using size–class midpoints yields essentially the same results as using exact measures of plant size.     

Introductory honors economics on the Web

Economics 304KH and 304LH at The University of Texas at Austin are introductory honors economics courses. Our goal was to provide students with more advanced material than available in introductory textbooks, such as a discussion of microeconomics based on one‐dimensional calculus and a survey of macroeconomics based on economic models. The supplemental material consists of Web course notes, on‐line quizzes, simulation and data modules and group interactive modules. This paper focuses on the development of Web economic course materials. We discuss the difficulties of programming mathematical instructional material in HTML and the coming solution in XML, JavaScript, and Java. The effectiveness of the on‐line course materials are also evaluated based on student responses. This revised version was published online in June 2006 with corrections to the Cover Date.     

Measuring Electronic Commerce Technology–Enabled Business Value: An Empirical Investigation

This research investigates whether firms using e-commerce technologies are successful in generating business value and, if so, which e-commerce drivers determine this success and how firms should use these drivers. There is no systematic empirical evidence in the IT productivity and business value literature regarding the payoffs a business receives from its e-business initiatives. The current research contributes to the literature in the e-commerce area by identifying a set of e-business value constructs, incorporating these constructs in a model in a manner not done before, and empirically validating the model using an Analysis of MOment Structures (AMOS)/?Structural Equation Modeling (SEM) analysis. The present research also contributes to the e-business value literature by providing insights into causal relationships among Rogers' innovation and diffusion theory (IDT) factors. This is the first time a research study has empirically established comprehensive causal relationships among these factors. The SEM analysis of the model indicates that the proposed model is able to explain e-commerce success utilizing the constructs identified and grounded using IT business value literature and Rogers' IDT. We conclude by summarizing its contributions to the IT literature, in general, and the e-business literature, in particular, and by providing insights for practice and suggestions for future research.     

Customer perceptions of “McService”’: Relationship with return intention

The fast-food restaurant segment has been a dominant player in the restaurant industry since the 1960s. The recent changes in the needs and wants of guests have affected fast-food restaurants' ability to keep up with the trends regarding healthy and high-quality food options served at reasonable prices. The service quality perceptions assessed in this study were divided into the following constructs: overall experience, employees, ordering process, receiving order, and food quality. The results determined that the construct that influenced repeat intention was food quality, specifically the individual items “fresh food” and “food taste.” The study also found that males tended to evaluate employees more positively than females. Moreover, frequent fast-food diners only tended to have favorable perceptions with regard to the overall ordering process. Implications for practitioners and suggestions for future studies are discussed.     

Coworking spaces: Understanding,using, and managing sociomateriality

Companies increasingly embrace the new types of work associated with coworking spaces. Coworking spaces started with the idea of a melting pot of open social interaction, collaboration, entrepreneurship, and innovation for freelancers, new ventures, or solo entrepreneurs. Companies may use coworking spaces to invigorate targets and further motivate and inspire their employees. Fundamental to achieving those targets is the coworking space’s interior design and architecture that incorporates emotional and social values that may benefit companies. Our sociomateriality perspective helps to analyze conditions in coworking spaces and guides suggestions on how companies revitalize by using coworking spaces. The purposeful design of the different social and work areas in coworking spaces can improve communication, collaboration, and innovation in companies.     

Is there a poverty trap for developing countries? Polarization: Reality or myth

A general view that as between countries ‘the rich are getting richer while the poor are getting poorer’ supported in the development literature by explanations relating to cumulative causation, economies of scale etc., and statistically based on the relation between GNP per capita in 1978 and its growth rates during 1960–1978, is shown to contain considerable elements of ‘myth’ or statistical ‘delusion’. The ‘naïve’ polarization hypothesis based on income levels at the end of the period over which growth rates are measured is left with a much weakened empirical basis when the proper substitution of levels of income at the beginning of the period is made. This is particularly so for low- and middle-income countries taken separately, while for the 18 industrialized countries a strong tendency towards convergence in per capita incomes emerges. Finally, for the growth in manufacturing value added during 1960–1977 a significant tendency towards convergence was observed in the case of a group of 24 least developed countries.     

The rate of hazard confronting new firms and plants in U.S. manufacturing

Three different factors are hypothesized to shape the hazard function confronting new businesses — the extent of scale economies relative to start-up size, the technological environment, and ownership structure. Using a longitudinal data base tracking the post-entry performance of more than 12,000 U.S. manufacturing establishments, a semi-parametric Cox regression model is used to estimate the hazard function. The evidence suggests that while the presence of high scale economies, a high-technological environment, and a relatively small initial start-up size tend to elevate the exposure of risk confronting new businesses, these factors apparently exert no influence on the likelihood of survival for new branches and subsidiaries established by existing enterprises.     

Firm selection and industry evolution: the post-entry performance of new firms

A dynamic framework based on the process of firm selection and industry evolution is used to analyse the post-entry performance of new firms. In particular, it is hypothesized that, based on the stylized fact that virtually all new firms start at a very small scale of output, firm growth and survival are shaped by the need to attain an efficient level of output. The post-entry performance of more than 11,000 U.S. manufacturing firms established in 1976 is tracked throughout the subsequent tenyear period. Firm growth is found to be negatively influenced by firm size but positively related to the extent of scale economies, capital intensity, innovative activity, and market growth. By contrast, the likelihood of survival is identified as being positively influenced by firm size, market growth, and capital intensity, but negatively affected by the degree of scale economies in the industry. When viewed through the dynamic framework of firm selection and industry evolution, the empirical results shed considerable light on several paradoxes in the industrial organization literature, such as the continued persistence over time of an asymmetrical firm-size distribution consisting predominantely of suboptimal scale firms, and the failure of capital intensity and scale economies to substantially deter the entry and start-up of new firms.     

A multilevel government model of deficits and inflation

In this paper, an attempt is made to properly identify the link between deficits and the rate of inflation by using two alternate macroeconomic models—one based on adaptive expectations and the other on rational expectations—for a multilevel government system. It is assumed that unlike federal deficits, state deficits cannot be monetized. Nonetheless, the interaction between state and federal inflation is explicitly incorporated into the model. When expectations are formed adaptively, the model confirms the positive link between deficits and rate of inflation. However, with rational expectations, the model shows that inflation is, in part, explained by the forecast error. It is proposed that only empirical testing of the theoretical models would give credence to such conclusions.