National culture and national savings: is there a link?

We study the effect of national culture on economic decisions, focusing on GLOBE cultural dimensions of uncertainty avoidance and future orientation. Specifically, we study the effect of divergence between cultural values and practices (societal aspirations), on the aggregate savings decision. Using the life-cycle model of savings as our basic model, we find that societal aspirations are important in explaining national savings behavior. In particular, we show that societal aspirations relating to future orientation and uncertainty avoidance have a positive effect on the rate of savings. We interpret our findings to indicate that such societal aspirations lead to mistrust in the societal arrangements and institutions, and induce savings as a means of securing the future and reducing uncertainty. To substantiate this interpretation, we utilize the microfinance industry; showing that high societal aspirations are associated with preference for savings through member-owned microfinance institutions (MFIs) over savings through non-member-owned MFIs.     

A Double Moral Hazard Model of Organization Design

We develop a theory of organization design in which the firm's structure is chosen by trading off ex post efficiency in the implementation of projects against ex ante efficiency in the selection of projects. Using our framework, we derive a novel set of empirical predictions regarding differences between firms with a functional structure and firms with a divisional structure. We examine how the overall profitability of the two structures is affected by various factors like size, complexity, and asymmetry in the importance of tasks and also explore the desirability of adopting a narrow business strategy.     

Finding Generators for Markov Chains via Empirical Transition Matrices, with Applications to Credit Ratings

In this paper we identify conditions under which a true generator does or does not exist for an empirically observed Markov transition matrix. We show how to search for valid generators and choose the "correct" one that is the most compatible with bond rating behaviors. We also show how to obtain an approximate generator when a true generator does not exist. We give illustrations using credit rating transition matrices published by Moody's and by Standard and Poor's.     

The dynamics of limited breaking out: the case of the Arab manufacturing businesses in Israel

This paper investigates the dynamics of breaking out in the Arab manufacturing business sector in Israel. Based on an ethnographic study and in-depth interviews, this paper develops a three-tier model delineating those characteristics that shape the entrepreneurs' response to structural constraints and their respective mode of operation in the context of resource disadvantage. The model demonstrates that the limited break out of ethnic entrepreneurs signifies selective access to the majority market. Through the model, the paper develops a comprehensive conceptual framework that incorporates two different sets of constraints stemming from the nature of the larger market and institutional setting and community characteristics. The limited breaking out can be explained largely by the dynamics of the interrelations among the institutional environment, the local resources, and the entrepreneurs' characteristics. This implies a Janus-face perspective of breaking out, in which the Arab entrepreneurs tend to use their resources both for the maintenance of their local market and for catering to special segments in the majority market that seek relatively cheap prices or specialized products. The paper concludes that the limited breaking out reflects institutional processes that militate against the minority's ability to fully integrate into the majority market.     

Substituting Distribution for Growth: The Political Logic of Intergovernmental Transfers in the Russian Federation

Given limited resources and economic realities, how do politicians distribute monetary transfers in order to retain office? Previous work has largely focused on two models – a core model of rewarding loyal supporters and a swing model of purchasing the support of easily swayed voters. Empirical results have proven mixed, however. In this article, we argue that these mixed results are due to economic factors, which condition politicians' distributive strategies. In our model, we consider that politician and voters are involved in a repeated game, where past expectations condition future strategy. Current (core) supporters who receive few benefits and perceive themselves worse off than other, less loyal, groups are likely to be less loyal themselves tomorrow. In our model, politicians avoid this by providing their supporters consumption benefits directly, in the form of transfers, or indirectly, via strong economic growth. Where economic growth is good, politicians can distribute less to core supporters, who benefit from the rising economy. Where economic growth is weak, however, politicians make transfers to their core supporters to ensure future loyalty. We test our theory using data on federal transfers from the Russian Federal government to 78 Russian Regions from 2000–2008.     

Cross-Country Productivity Comparisons: The “Revealed Superiority” Approach

This paper proposes a novel non-parametric methodology for comparing total factor productivity (TFP) across countries and over time. It develops the principle of revealed superiority along the lines of Samuelson's principle of revealed preferences. Specifically, we compare the aggregate actual profits in each country to the hypothetical profits it would have earned if, facing its own prices, it had employed another country's inputs and produced its output. We show that our procedure reveals the true TFP ranking under relatively mild assumptions. We apply our method by ranking a panel of the 25 richest economies relative to one another and over time and find that the United States enjoys the highest TFP whereas Singapore has the lowest.     

The museum pass game and its value

We discuss a game in which service providers (e.g., museums) team up in offering a limited time access pass allowing unlimited usage of their services. In this game, a natural way to allocate the joint income from the sale of passes among the service providers is by using the Shapley value. We show that, for the particular game considered, the Shapley value takes a very intuitive and computationally simple form.     

How accurate is the integrated vendor–buyer continuous model?

The classic single-item, deterministic-demand, integrated vendor–buyer model is revisited. The decision problem may also be viewed as that of one centralized firm, dealing with a two-level EOQ-like supply chain with finite production rates. It is sought to optimize the production lot-size and the integral number of its shipments, in equal batches, from the vendor to the buyer. While the problem calls for discrete optimization techniques, we introduced a continuous model where one can take derivatives with respect to both variables. In this short paper, we establish a 98.5% lower bound on the accuracy of this continuous model.     

Entrepreneurial Mind-Set Among Female University Students： A Study of University of Jos Students,Nigeria

In today＇s world, entrepreneurship is seen as the vital source for economic growth, and education in the creation and development of entrepreneurial attitudes. It is, therefore, natural to consider female students as the primary resource of future entrepreneurs. Entrepreneurship as a career option is becoming increasingly desirable. Responding to this need, many colleges and universities around the world have significantly increased their offerings of entrepreneurship courses over the past 25 years. Entrepreneurship courses are not only offered by Business Institutes, but other faculties like Social Sciences, Natural Sciences, Engineering, and Information Technology are also offering these courses in their syllabus. The problem under focus was to examine entrepreneurial mindset among female university students, a study of University of Jos. The study also ascertained the rate at which variables like： perception of entrepreneurship, role model and university＇s role to promote entrepreneurship are translated into entrepreneurial mindset of female students of University of Jos. A sample size of about 400 was adopted from the three Faculties of Management Science, Natural Sciences, and Social Sciences which were selected at random. Furthermore, the data obtained were analyzed using simple percentage and presented in tables and charts, the hypothesis which states that there is no significant relationship between the teaching of entrepreneurship and university female students＇ entrepreneurial mindset which was tested using z-test analyses of population proportion earlier conducted. This implies a weak relationship between the teaching of entrepreneurship and university female students＇ entrepreneurial mindset. Based on the above inference, the research recommended that, as providers of entrepreneurship trainings, universities must create entrepreneurship supportive environment that could encourage entrepreneurial activity which would in turn help develop an enterprise culture among the female students.