German stagnation versus Swedish progression: gender wage gaps in comparison, 1960–2006

This article provides a comparative analysis of the development of the gender wage gap in West Germany and Sweden during the period 1960–2006. Despite the economic similarities including broad social safety nets, the gap has developed differently since 1960. This analysis accounts for micro- and macroeconomic factors and politics and concludes that norms and traditions penetrate institutional settings and ensnare Germany in a cultural trap with regard to gender equality. While Sweden has moved to a two-earner model, German society expects mothers to stay at home. The micro analysis shows that family concerns (e.g. marriage and motherhood) decrease female income in Germany to a far greater extent than do such factors in Sweden, which can be explained in part by deeply held social attitudes.     

International migration versus foreign investment in the presence of unemployment

"This paper extends the standard (two-factor, one-good) model of international factor movements, to include unemployment due to a minimum-income guarantee within the capital-abundant country. From this country's perspective, we establish important departures from previous (full-employment) results. Most notably, our analysis shows that: (1) free factor mobility is worse than no mobility; (2) the optimal degree of labour migration is zero; and (3) national welfare can always be maximized by an optimal flow of capital. The analysis is then extended to examine: (1) illegal migration; (2) subsidization of employment; and (3) alternative views of unemployment."     

Modeling how institutional investors allocate business to brokers

A model of how institutional investors evaluate and allocate business to brokers shows a complex pattern of influences. The broker's ability to execute transactions at appropriate prices is basic, but this combines with research and sales force performance to build a relationship that affects over-time allocation of business. It is difficult to separate relationship and selling performance, and relationship is subject to considerable decay. Research ability has a weak effect on business allocated on the basis of trading, while trading ability does affect business allocated on the basis of research.     

Measuring Market Orientation: Generalization and Synthesis

This paper reports on an integrative, cross-nationalstudy which synthesizes and retests work of three separate groupsof researchers who in the late 1980s developed measurementsof a firm's Market Orientation. The projects resulted in threedifferent but syntactically similar Market Orientation scaleswhich, along with other measures, were used to support substantiveconclusions, particularly those involving firm Performance. Basedon a new study of 82 managers in 27 European and U.S. companies,we show that all three scales are reliable and valid. The scalesalso seem to generalize well internationally, both in terms ofreliability and prediction of Performance. We also show thatthe scales are similar to one another in terms of various validitymeasures and in terms of correlations with Performance measures.Finally, we synthesize a 10-item scale based on a more parsimoniousdefinition of Market Orientation as: the set of cross-functionalprocesses and activities directed at creating and satisfyingcustomers through continuous needs-assessment.     

Exchange rates and bertrand oligopoly

The impact of exchange-rate changes on industrial prices seems ambiguous. Incomplete and even perverse pass-through has been observed: the import prices in the depreciating country decrease while those in the appreciating country increase. To explain these counterintuitive price reactions we consider a situation of international Bertrand competition: two firms, based in different countries, are selling in both countries simultaneously. The profit-maximizing duopolists set the prices for their products in each of the two markets which are segmented on the demand side. We then study the qualitative effect of an exogenous exchange-rate change on the Bertrand-Nash equilibrium. Under the strong assumption of linear demand and cost functions we have normal exchange-rate pass-through. However, allowing for more general cost structures in this simple static model enables us to show that the import prices in both countries might move in counterintuitive directions.     

Incumbency advantage and its value

Markets with network effects are typically concentrated. The aim of this paper is to discuss some recent work on “incumbency advantage.” That is, the fact that firms already installed generate higher profits than entrants even if the latter offer identical or even better terms (in terms of price and quality) to consumers. In particular, we review recently known sources of the advantage and potential mitigating factors and point to a number of open issues.     

Varying Coefficient Regression Models: A Review and New Developments

Varying coefficient regression models are known to be very useful tools for analysing the relation between a response and a group of covariates. Their structure and interpretability are similar to those for the traditional linear regression model, but they are more flexible because of the infinite dimensionality of the corresponding parameter spaces. The aims of this paper are to give an overview on the existing methodological and theoretical developments for varying coefficient models and to discuss their extensions with some new developments. The new developments enable us to use different amount of smoothing for estimating different component functions in the models. They are for a flexible form of varying coefficient models that requires smoothing across different covariates' spaces and are based on the smooth backfitting technique that is admitted as a powerful technique for fitting structural regression models and is also known to free us from the curse of dimensionality.     

Abschätzung der Varianz stetiger Merkmale aus Intervallbreite und Mittelwert

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