Dynamic analysis of outsourcing

This paper develops an R&D-based growth model and calibrates the model to aggregate data of the US economy to quantify a structural relationship between patent length, R&D and consumption. Under parameter values that match the empirical flow-profit depreciation rate of patents and other key features of the US economy, extending the patent length beyond 20 years leads to a negligible increase in R&D despite equilibrium R&D underinvestment. In contrast, shortening the patent length leads to a significant reduction in R&D and consumption. Finally, this paper also analytically derives and quantifies a dynamic distortionary effect of patent length on capital investment.     

A supply chain-transport supernetwork equilibrium model with the behaviour of freight carriers

This paper presents a supernetwork equilibrium model integrating supply chain networks with a transport network, namely, a supply chain-transport supernetwork equilibrium model. The model takes into account the behaviour of freight carriers and transport network users to endogenously determine the transport costs generated in the supply chain networks. The interaction between transport network and supply chain networks can also be examined. Results of the numerical tests reveal that the improvement of transport network could enhance the efficiency of supply chain networks. The paper makes contributions to modelling of supply chain networks as well as to that of transport networks.     

An Emergency Evacuation Planning Model Using the Universally Quickest Flow

In recent years, catastrophic disasters by massive earthquakes have been increasing in the world, and disaster management is required more than ever. In the case of disasters such as tsunamis, a slight delay in evacuation may deprive evacuees of life. In this article, we formalize the emergency evacuation planning model for evacuation from tsunamis and other disasters based on the idea of the universally quickest flow. We show that there does not always exist a universally quickest flow when the capacity constraint of refuges is taken into account. Therefore, we propose an alternative criterion that approximates a universally quickest flow, and presents an algorithm for finding an optimal flow for this criterion. Numerical experiments are carried out for the evacuation of a local city in Japan where tsunami damages are assumed to occur when a large earthquake occurs in the ocean nearby.     

Managerial Myopia,Earnings Guidance,and Investment*

This study investigates the real effects of management communication, specifically of forecasts or earnings guidance, on investment. Managers can signal the strength of their projects through accuracy in their earnings guidance. This leads less accurate managers to distort their investments; the equilibrium investment strategy involves over-investment when earnings exceed the forecast and under-investment when earnings fall short. Moreover, we find that managers are pessimistic in their forecasts, which helps to explain the corresponding well-documented empirical regularity. This downward bias increases the likelihood of investment manipulation but decreases the real loss from distortion. Interestingly, the over-investment induced by earnings guidance helps to mitigate the classic under-investment problem for a myopic manager with unobservable investment. Earnings guidance can therefore be value-increasing when managerial myopia is severe.     

Indivisible commodities and the nonemptiness of the weak core

We consider a sufficient condition for the nonemptiness of the weak core in a finite exchange economy where every commodity is available only in integer quantities. We show that if the aggregate upper contour set is discretely convex, then the weak core is nonempty. In addition, we give two sufficient conditions for the aggregate upper contour set to be discretely convex. One is that every upper contour set of every agent is M^?${\text{M}}^{?}$-convex. The other is that the number of commodities is two and every agent’s preference relation is weakly monotone and discretely convex.     

Who values the family‐friendly aspects of a job? Evidence from the Japanese labour market

Women with family responsibilities such as child‐rearing generally prefer jobs with flexible working conditions. According to the theory of compensating wage differentials, women working in such family‐friendly jobs are paid less than those working in family‐unfriendly jobs. The present paper investigates whose wages are more greatly affected by the family‐(un)friendly aspects of their jobs. Based on a longitudinal survey of Japanese women, we found that among several family‐(un)friendly attributes of a job, only commuting time requires a wage premium, and most of the premium is associated with job changes made by part‐time‐working married women.     

Policy trade-off in the long run: A new Keynesian model with technological change and money growth

In this study, we introduce a constant rate of technological change and money growth into the standard new Keynesian model, in which both prices and nominal wages are supposed to be sticky. Using such a model, we examine whether a policy trade-off exists between curbing inflation and stabilizing the welfare-relevant output gap in the steady state. If we take only price stickiness into consideration, a policy trade-off does not occur. However, if both nominal wage stickiness and price stickiness are taken into consideration, a policy trade-off occurs.