Structural Decomposition Analysis of Physical Flows in the Economy

Many environmental problems can be attributedto the extraction and emissions of physicalsubstances. Increasing our understanding of theeconomic and technological driving forcesbehind these physical flows can contribute tosolving the environmental problems related tothem. The input-output framework is a usefulsetting in which to integrate detailedinformation about economic structure andphysical flows. In this article a specificmethod in input-output analysis is reviewed,namely Structural Decomposition Analysis (SDA).It is based on comparative static analysis,which decomposes historical changes of a policyvariable into determinant effects. SDA has beenapplied, for example, to analyze the demand andtechnological driving forces of energy use,CO₂-emissions and various other pollutantsand resources. This article examines thetheoretical aspects of structuraldecomposition, in particular those concerningphysical flows and environmental issues.Furthermore, the article includes an extensivesurvey of empirical studies.     

A maximum likelihood approach to estimating dynamic models with unobserved independent variables

A maximum likelihood method to estimate the parameters of dynamic models containing unobserved independent variables is proposed. The approach is to maximize the likelihood of the residuals produced by the recursive Kalman filter equations applied to the model in state-space form. A simulation study is presented comparing the proposed method to the instrumental variable approach. An example using real data is given which estimates models of the Permanent-Income Hypothesis.     

Embodied and Disembodied Technical Change in Fisheries: An Analysis of the Sète Trawl Fishery, 1985–1999

Overfishing and excess capacity in mostfisheries around the world have generated considerableand increasing concern about their biological and economic performance ramifications. Theseproblems, in part, stem from substantialinvestment in technical improvements to boats andequipment in fishing fleets, which exacerbatesexcess fishing capacity and low returns tofishing effort and investment, given regulatoryand biological constraints. However, little attempt hasbeen made to quantify the extent or effects oftechnical change in fisheries. In this paper, we usedetailed data on innovation patterns for 19vessels in the Sète trawl fleet of southernFrance to evaluate the contributions oftechnical change to catch rates. We find thatembodied technical change enhanced productivity by approximately one percent per year between 1985 and 1999, but that external (disembodied) events counteractedthis trend, causing a net output decline ofabout three percent per year.     

Integrating design metrics within the early supplier selection process

It has been found from the contemporary research in the fields of supply chain management and concurrent engineering that significant benefits can be achieved if suppliers are involved in product development. However, recent investigations in manufacturing industries have revealed that early supplier involvement in the design process is not widely practiced. One issue is the lack of an appropriate customer–supplier interface to assess the suitability of suppliers with reference to design criteria. This paper proposes a mechanism for evaluating supplier involvement during product development. The assessment tool includes four types of distinctive indices to measure supplier involvement in the design process, namely: Satisfaction Index, Flexibility Index, Risk Index, and Confidence Index. These indices measure the extent to which both the customer requirements and the supplier capabilities match or mismatch and therefore reflect the potential or risk of signing a project contract. The proposed methodology is discussed within a multinational telecommunications company and preliminary analysis indicates that the approach provides an effective mechanism for selecting suppliers involved in the product development process.     

Announced layoffs: Their effect on corporate financial performance

Conventional wisdom holds that when a firm gets into trouble due to lagging sales and rising costs, cutting the size of the organization to reduce fat and waste is a normal and effective response. In this study, evidence was found to suggest that just the opposite might be true. The financial performance of Fortune 100 companies was tracked over a five-year period—two years prior to the announced layoff, the year of the layoff announcement, and two years following it. Contrary to expectations, the results indicate that financial performance worsened, rather than improved, following announced layoffs. Strategic and human resource implications for the management of corporate downsizing are provided.     

Don’t kill the messenger! Whistle-blowing in America — A review with recommendations

Whistle-blowing in America business and industry has increased as interest in ethical business behavior and the cost of unethical behavior have grown. Whistle-blowing plays the important role of helping to fill the gaps in the regulatory system that is designed to check the abuse of organizational power. However, the practice of whistle-blowing is controversial and whistle-blowers often pay a high price for their actions. Firms can engage in a number of actions to encourage whistle-blowing. Creating a climate that encourages employees to report organizational wrong doing and that protects the whistle-blower is critical. To create such a climate the organization must build trust and cooperation by educating employees in the benefits of ethical and legal behavior.     

Aid, Agriculture and Poverty in Developing Countries

The authors make two contributions to the debate on aid‐effectiveness, illustrating that for impact on poverty what matters is not just the level but also the composition and stability of aid. One specific implication of this for aid policy is that aid most effectively reduces poverty if it supports public (and other) expenditures which are supportive of agricultural development. Regression analysis confirms that these are not only direct expenditure on agriculture, but also on education and infrastructure, and military expenditure has a negative impact. Three factors appear to be particularly conducive to the development of stable pro‐poor expenditure patterns (and in particular pro‐agriculture expenditure patterns). These are expenditure strategies which protect the poor against risk, the development of stable relations between governments and aid donors, and long‐term political commitment to pro‐poor strategies by government. The argument is pursued partly by panel‐data econometric analysis of developing countries as a whole, and partly by case studies of sustained and non‐sustained green revolutions in heavily aid‐dependent countries in Africa.     

Stock-flow matching and the performance of the labor market

We estimate outflow equations for vacancies and unemployed workers in Britain, departing from the stock-based analysis of matching in two ways. First, we deal with the temporal aggregation problem that arises when discrete time data are used to describe continuous time processes. Second, we allow for a stock-flow matching mechanism in which the stock of traders on one side of the market matches with the flow of traders on the other side. Our estimates are in line with the predictions of stock-flow matching in terms of higher exit rates of flows and of matching combinations between labor market stocks and flows. Furthermore, employer search effectiveness did not seem to decline between the 1960s and the 1990s. Nevertheless, some deterioration in worker search effectiveness is detected, however less severe than that implied by previous, stock-based work.