Economic Growth,Productivity Gains and Foreign Capital: A Comment

Journal of Quantitative Economics -     

Public trust and corruption perception: disaster relief

Public trust in government and nongovernment organizations is essential to the public’s willingness to donate and to support those organizations. We measure public trust in disaster aid using people’s perception of these organizations’ effectiveness in delivering aid relief to the victims of two recent major earthquakes in China. Based on the survey data collected in 2013 from about 2100 residents in Hong Kong, we document the vulnerability of these residents’ trust perceptions in aid delivery. We find that the sharp decline in trust perception is highly negatively correlated with their perception of corruption of local governments in China.     

Downtown parking meter demand in a border metropolitan economy

Prior research establishes that the price of parking in the city centre often impacts the decision to travel downtown and the mode of transportation utilized. Other factors that influence the decision to drive and park downtown have received less attention. This study uses time series data to analyse the demand for metered parking spaces in El Paso, Texas, USA. In addition to meter rates, the determinants of demand include personal income, gasoline prices and the price of a substitute good, parking garage spaces. Because international bridges connect downtown El Paso to neighbouring Ciudad Juárez, Chihuahua, Mexico, the impacts of trans-boundary traffic flows, bridge tolls and other cross-border economic variables are also included as potential determinants of metered parking demand. Results indicate that parking meter rates, other transportation-related costs, and economic conditions in both countries affect meter use.     

Birth,Death, and Consumption: Overlapping Generations and the Random Walk Hypothesis

This paper studies the time-series behavior of consumption in a model that incorporates birth, death, and a precautionary motive for saving. Consumption of an individual agent is a random walk. However, aggregate consumption is a random walk if and only if the sum of the death rate and population growth rate is zero. Failure of the random walk hypothesis should not be attributed to finite horizons perse, but rather to inter-generational transfers caused by birth and death. Unlike certainty-equivalent models, the expected growth of consumption depends on financial wealth, rather than wage income or human capital. [D91, E21]     

Tax Incidence in a Model with Efficiency Wages and Unemployment

Abstract

The purpose of the present paper is to examine the effects of taxation on income distribution in a model with efficiency wages and involuntary unemployment. Central to our efficiency-wage model is the hypothesis that firms set wages above market-clearing levels, whenever the productivity of labor depends on the real wage paid by the firm, and unemployment. Within a two sector general equilibrium model we study the incidence of factor and commodity taxes on income distribution, and unemployment. Our findings differ substantially from those derived by the traditional neoclassical analysis, originally developed by Harberger, and as it has been extended by several authors.     

Technological Progress,Income Distribution,and The Explanation of Some Stylized Facts of Economic Growth

This paper examines the effects of technological progress in the framework of a specific-factor variant of the “dependent economy” model. We analyse, first, the effects of technological progress on income distribution, and secondly, its effects on commodity prices, and the structure of production. Our model predicts that, services must be more expensive in the country with higher per capita GDP, and that labor productivity in manufactures is positives associated with the per capita income, etc. The model can also explain several other stylized facts of economic growth. [O33, F11]     

Looking Backward at Feasible Socialism: Using Bellamy to Teach Schumpeter

This article demonstrates the parallels between Bellamy's fictional society in Looking Backward and Schumpeter's socialist blueprint Capitalism, Socialism, and Democracy. The socialist system Joseph Schumpeter describes is nearly identical to that in Edward Bellamy's utopia. Because Bellamy's society is a concrete one set within the readable confines of a novel, it provides a useful benchmark for students analyzing Schumpeter.     

Failures and Coping Strategies in Indigenous Technology Capability Process

This paper reports on a theory building effort aimed at understanding persistent difficulties with efforts at developing plant-level indigenous technology in a developing country. The firms, having obtained the technology from a donor firm or a laboratory find that implementation and adaptation issues are difficult due to tacit technology knowledge and lack of technical or managerial or market-related systems and experiences. These lead to technological failures referring to situations where serious deviations from expected opportunities and outcomes occur. The failures include loss of entry opportunities, or rejection of technology by the market, or failure at improving processes. With insights offered from 92 organizations in India we identify the different technological failures that occur and ways used to overcome these problems. Exploratory results suggest four major technological failures. (1) Failure due to inappropriate choice of technology leading to longer-than-expected time for establishing production, or inefficient production process, and/or market losses due to poor image of the poorly calibrated product. (2) Failure due to inadequate planning and support for innovation occurs when firms do not invest sufficiently in plant level data collection and analysis, thus missing important avenues for incremental innovation. (3) Failures due to inappropriate processes reveal how short-term orientation and low integration amongst different functional groups thwart the firm’s adaptive and innovative abilities. (4) Finally, failure due to product‐market mismatch and inadequate market survey occurs when market desired features are not maintained, or the incorporated changes are not cost effective. The coping strategies adopted by the firms are also discussed.     

Firms' Market Power,Endogenous Preferences and the Focus of Competition Policy

Conventional neoclassical views of dominance are generally restricted to a concern for a firm's market power seen in terms of the ability to raise and maintain prices above their marginal costs of production. A prime example of this approach is the application of dominant firm price leadership models, which has led to a restricted theoretical perception of the nature of market power and to an incomplete view of the social costs of monopoly power. This paper argues that a broader conception of a firm's market power leads to a quite different perspective on its conduct. In particular, if we allow dominance to involve the ability to influence product demand patterns, then the theoretical analysis of firm behaviour changes significantly. Specifically, it implies the endogeneity of preferences which, it is argued, represents an important alternative to mainstream analysis. It is suggested that we need to consider a firm's dominance not so much in terms of its pricing in the context of a particular market structure but to focus on its ability to gain advantage over its rivals in terms of 'creating' an asymmetry in the demand for its products. This has important implications for competition policy, for it suggests a need to concentrate on the 'power' of firms and less on the effects of a change in market structure. Likewise, we need to reconsider the adequacy of defining markets in terms of product demand characteristics.