Non-convex aggregate technology and optimal economic growth

This paper examines a model of optimal growth where the aggregation of two separate well behaved and concave production technologies exhibits a basic non-convexity. First, we consider the case of strictly concave utility function: when the discount rate is either low enough or high enough, there will be one steady state toward which the convergence of the optimal path is monotone and asymptotic. When the discount rate is in some intermediate range, we will find sufficient conditions for having either one equilibrium or multiple equilibria steady state. Depending to whether the initial capital per capita is located with respect to a critical value, we show that the optimal paths monotonically converge to one single appropriate equilibrium steady state. Second, we consider the case of linear utility and provide sufficient conditions to have either unique or two steady states when the discount rate is in some intermediate range. In this range, we give conditions under which the above critical value might not exist, and the economy attains one steady state in finite time, then stays at the other steady state afterward. P. Michel passed away when this research was completed. This paper is dedicated to his memory as a friend and colleague. N. M. Hung and C. Le Van thank the referee for vey helpful remarks and criticisms. They are grateful to Takashi Kamihigashi for very fruitful discussions. They also thank J.-F. Leclerc for editing the final version of this paper.     

Voting by Successive Elimination and Strategic Candidacy

We study the impact of strategic choices of self-interested candidates of whether or not to enter an election. We focus on strategic candidacy in the context of the tree and binary voting procedures used by small groups such as committees. We offer a comprehensive analysis for the special but important case of voting by successive elimination. Strategic candidacy slightly enlarges the set of candidates that can be equilibrium outcomes relative to the traditional analysis which takes the set of candidates as fixed. Pareto-dominated candidates can be elected in equilibrium under voting by successive elimination when strategic candidacy is considered, in contrast with a fixed set of candidates. Journal of Economic Litterature Classification Numbers: D71, D72.     

Lobbying under political uncertainty

This paper considers a model of lobbying described as a common agency game; it departs from the current literature by assuming that the special interest groups are not a priori organized or unorganized and that the type of the politician is not common knowledge. We characterize equilibria when the choice set of the politician consists of two policies; we discuss the conditions leading to efficiency and the characteristics of the groups explaining their relative success in the process of influence. We also offer some results for the general case, including disjoint necessary and sufficient conditions for the equilibria to be efficient.     

Assessing a Perfect European Optimum Currency Area: A Common Cycles Approach

In this paper we introduce a new definition for an optimum currency area (OCA) which is more restrictive than the previous ones. Indeed, using both a cointegration and a common cyclical feature analysis in a VAR(p)framework, a set of countries is said to constitute a perfect OCA if theshort-run dynamics is perfectly correlated while long-run relationships arenot constrained. Using seasonally unadjusted industrial production indicesfor the period 75:M1 to 97:M4, we show that European countries are notsufficiently related to fit our definition.     

哈佛商学院“违规潜规则”

软件工程师、航班机组成员、工人、邮递员、卡车司机、医院护士……这些人有什么共同点？Michel Anteby教授会告诉你。他们的行业都存在一个“道德灰色地带”（moralgrayzone）,即工作中有一些明令禁止的行为,但即使员工触犯,管理者也会睁一只眼闭一只眼,见怪不怪。     

The effect of production uncertainty on the labor-managed firm

The effects of production uncertainty on the behavior of the labor-managed, cooperative firm are examined and it is shown that they generally differ from the case of certainty and the case of the entrepreneurial, profit-maximizing firm. In particular, it is shown that the risk-averse (risk-seeking) cooperative will have a larger (smaller) ratio of labor to nonlabor input employed in production than the risk-neutral cooperative.     

Planning with great uncertainty: A review and case study of the safe drinking water controversy

Since 1974, monitoring the water for dangerous contaminants and judging the impact of low levels of contamination on human health have become highly controversial environmental planning issues in the United States. This paper overviews the chemical, ecological correlation, and case control literatures to establish a baseline and then focuses on New Jersey, the state with the highest cancer mortality rates in the United States from 1950 to 1969, for a case study. While estimates of cancer incidence from consuming contaminated water are made, the scientific results are inconclusive. When combined with economic and political questions, the overall result is to highlight an issue frought with uncertainty presenting serious dilemmas for scientific planning.     

Monitoring, Implicit Contracting, and the Lack of Permanence of Leveraged Buyouts

We present a possible explanation for the lack of permanenceof the very high levels of concentration of ownership that accompanyleveraged buyouts. We first argue that some diffusion of ownershipcan be beneficial to the shareholders of a firm by encouragingthe employees of the firm to enter into implicit contracts withthe firm. The level of concentration of ownership that maximizesfirm value is therefore that which trades off the well-knowngains from monitoring with the gains from implicit contracting.We then argue that, in the process of concentrating the ownershipof a firm that has excessively diffuse ownership to a levelthat maximizes firm value, investors in leveraged buyouts willchoose an initial level of concentration of ownership that isvery high. They will do so in order to put pressure on managersto breach existing implicit contracts. Following the breachof these contracts, investors will decrease the level of concentrationof ownership to the level that maximizes firm value. There willbe no further breach of implicit contracts, for such breachis incidental to the transformation of the firm from one thathas excessively diffuse ownership to one that has the optimallevel of diffusion of ownership. No change in the concentrationof ownership therefore occurs once the level of diffusion ofownership that maximizes firm value has been attained. JEL Classification:G30.     

Reported and secret interventions in the foreign exchange markets

Using a new approach relying on news wire reports, we estimate the proportion of secret interventions (i.e., unreported official interventions) in the foreign exchange markets that have been conducted by the three major central banks since 1985. We therefore revisit the estimation of conditional probabilities of secret operations and compute them by both central bank and operation type. The proportion of secret interventions is found to be lower for concerted operations and to display a great deal of variability over time as well as across the three major central banks. Our analysis reveals that the Bank of Japan has recently adopted an intervention policy more based on secret operations.