REINVENTING THE WHEEL? AFRICAN COOPERATIVES IN A LIBERALIZED ECONOMIC ENVIRONMENT

ABSTRACT ** :  Cooperative development in Africa can be said to have traversed two main eras: the era of state control and that of liberalization. The first era lasted up to the early 1990s and saw the origin and substantial growth of cooperatives on the continent. During that period, different models of cooperative development were introduced on the continent. We distinguish a unified cooperative model, a social economy model, a social movement model, a producers' model and an indigenous model. But in all cases, cooperatives were engulfed into state politics. However, little is known about the impact of liberalization measures on these models. Our research in 11 African countries reveals that cooperatives in Africa have survived the market forces and continued to grow in number and membership. We see a slow but sure erosion of the unified model and the adoption of a social economy model. Cooperatives in Africa are re-examining their organizational forms and diversifying their activities in response to members' interests and needs.     

Dynamic inefficiency in an overlapping generations economy with production

Reichlin [Equilibrium cycles in an overlapping generations economy with production, J. Econ. Theory 40 (1986) 89-102] has shown in an OLG model with productive capital that whenever the steady state is locally indeterminate and undergoes a Hopf bifurcation, it is Pareto-optimal. While these results were established under the assumption of Leontief technology, the author has partially extended them to show that the Hopf bifurcation is robust with respect to the introduction of capital-labor substitution. In this note, we prove that the Pareto-optimality of the steady state does not extend to technologies with capital-labor substitution. When the steady state is a sink or undergoes a Hopf bifurcation, it is characterized by over-accumulation with respect to the Golden Rule—the interest rate is negative—hence not Pareto-optimal. Most importantly, it follows that stabilization policies targeting the steady state leave room for welfare losses associated with productive inefficiency, apart from the very special case of Leontief technology.     

Professor Caldwell on Ludwig von Mises' methodology

The Review of Austrian Economics -     

Can Voluntary Workplace Partnership Deliver Sustainable Mutual Gains?

This article draws on two Irish case studies to examine the nature and outcomes of voluntary workplace partnership (WP), and the conditions affecting its durability. We found that WP delivered mutual gains for all stakeholders at Aughinish Alumina (AAL), which were quite equally divided. While WP delivered most gains for management at Waterford Crystal (WC), and some for the union, worker gains were less. The WC partnership broke down after 10 years, but the AAL partnership continues. Voluntarist mutual gains partnership is feasible, but success and durability depends on specific clusters of contextual conditions, notably management support, a quality‐focused competitive strategy, insulation from market pressures, union postures, vertically aligned bundles of mutual gains practices, institutional supports, emphasis on fairness, all party commitment to performance enhancement and capital‐intensive technology. Conditions supporting WP were stronger at AAL than WC. More generally, as supports for WP in Ireland are weaker than retardants, we conclude that few mutual gains partnerships will take root, and even fewer will endure.     

The impact of state legislation on the organisation of trade unions: The case of the Botswana Federation of Trade Unions (BFTU) in Botswana

Labour legislation is the unique device governments use to lay down standards and conventions in the workplace and to control industrial relations. Using focused interviews with unionists, government officials, employers and other relevant parties, this field study investigated the way in which labour legislation in Botswana affects the organisation of the country's federation of unions. The findings indicate that the BFTU's organisation is affected by the Trade Union and Employers Organisation Act. In particular, the restric‐ tions in this Act separate policy and administration in the BFTU and this has had negative implications for the union's effectiveness. The fact that its policymaking body is part‐time negatively affects coordination, communication and cooperation processes in the BFTU. According to the Act, public sector workers are not technically employees and therefore cannot belong to unions. This gives the impression that the state is not particularly convinced about the benefits of unionisation. This may create a difficult environment in which the BFTU and other unions must operate.     

Problems with detecting assumed mediation using the hierarchical multiple regression strategy

In human resource management (HRM) and allied fields (e.g., organizational behavior, management, and industrial and organizational psychology), tests of mediation are frequently conducted using the hierarchical multiple regression (HMR) strategy of Baron and Kenny [Baron, R. M., & Kenny, D. A. (1986). The moderator–mediator variable distinction in social psychological research: Conceptual, strategic, and statistical considerations. Journal of Personality and Social Psychology, 51, 1173–1182]. Although previous research has identified a number of serious problems with this approach, the present study adds to the literature by identifying yet additional problems with its use in inferring the existence of mediation. Using a statistical simulation, we found that certain patterns of correlation coefficients guarantee inferences about mediation, whereas other patterns preclude such inferences. On the basis of various analyses including logistic regression and inspection of three-dimensional plots, we identified patterns of correlation coefficients needed to satisfy Baron and Kenny's [Baron, R. M., & Kenny, D. A. (1986). The moderator–mediator variable distinction in social psychological research: Conceptual, strategic, and statistical considerations. Journal of Personality and Social Psychology, 51, 1173–1182] conditions for inferring mediation. The same patterns have no necessary relation to actual causal connections among variables in mediation models. Moreover, as a consequence of the failure of the HMR strategy to detect mediating effects, many instances of actual mediation in HRM and allied fields may have gone undetected. In view of the foregoing, we conclude that the HMR strategy should no longer be used in testing for mediation.     

Estimating elasticities with frontier and other regressions in evaluating two advertising strategies for US Army recruiting

To help resolve a long-standing debate in the US Government on advertising strategies for military recruitment, this study applies ordinary least squares (OLS), which here includes (1) stochastic frontier analysis (SFA) and (2) frontierized least squares (FLS), to evaluate two distinct advertising strategies: Service Specific vs. Joint. Thus, in contrast to the customary use of a single central tendency method, such as OLS, on different models, we here use multiple methods on a single model to cross check and validate results. In addition to serving as cross checks, the methods can be used to identify classic problems, including biases in the data and shortcomings in one or more of the methodologies employed. To avoid dealing with problems on identifying motives underlying various patterns in advertising expenditure, data are drawn from a statistically designed experiment where the expenditures were controlled as part of the experiment to resolve the issue of a choice between the two advertising strategies of interest. In contrast to earlier studies, the current paper finds that all methods used lead to the same conclusion: Service Specific is more efficient than Joint, at least for the US Army—which is, by far, the largest military advertiser. Finally, the paper introduces a new method for reallocating advertising budgets between the Uniformed Services which (a) is simpler than the customary use of cross partial derivatives, (b) avoids the need for the ceteris paribus assumptions for each such allocation, as in customary reallocation methods and (c) simplifies matters so that, for instance, it is not necessary to introduce an entirely new organization to administer the desired coordinating activities.