New evidence of the interdependence in the labor-supply behavior of white couples

A logit technique is used to estimate couples' joint probabilities of various labor-force statuses, given their personal characteristics. Conditional probabilities of the labor-force status of spouses are inferred. An analysis of these probabilities suggests that, while spouses appear to be complementary in participation decisions, there is also evidence of substitutability in spouses' work hours, ceteris paribus.     

Sectoral adjustment in government expenditure in the 1970s: The educational sector in Latin America

As a consequence of economic stagnation and the increasing difficulties faced by developing country governments in financing their budgets, it might be expected that the education sector in these countries would suffer cutbacks. On the other hand, in most countries the education sector has high political, social and economic priority and is therefore one of the more difficult sectors within which to make adjustments. This paper examines the experience of 18 Latin American countries in terms of how educational spending has evolved at each educational level during the period 1965–1978. A comparison is made of the periods before and after the adjustment of the 1970s. The authors evaluate the form that expenditure adjustments have taken and conclude with some remarks on the patterns which emerged.     

The under-utilization of human resources in industrial relations theory and practice

Industrial relations, as a theoretical and practical system of work arrangements between employees, unions, management and governments, have come under substantial pressure in recent decades, but neither theory nor practice has fully adjusted to the new circumstances. The article describes the changing conditions in relation to one aspect of the industrial relations (IR) system, namely influence and power sharing outside the sphere of collective bargaining. The analysis is based on two theoretical models derived from an accumulation of social science research evidence since the 1960s and further supported by recent comparative studies of countries with significant different IR philosophies.

The application of the human resources and motivated competence models to IR leads to the conclusion that long-term interests of employees and management as well as governments are best served by having a dual system of influence and power sharing, only one of which is adversarial.     

Politics,institutions, and outcomes: Electricity regulation in Argentina and Chile

Risk, whether market or political, is an important determinant of private investment decisions. One important risk, subject to control by the government, is the risk associated with the hold-up problem: governments can force utilities to shoulder burdensome taxes, to use input factors ineffectively, or to charge unprofitable rates for their service. To attract private investment governments must be able to make commitments to policies that are nonexpropriative (either to contracts that guarantee very high rates of return or to favorable regulatory policies). These commitments, of course, must be credible.

Judgments about the credibility of commitments to regulatoty policies are based upon two political factors: regulatory predictability and regime stability. Regulatory predictability implies that the regulatory process, in which prices and levels of service are set, is not arbitrary. If the condition of regulatory predictability holds, then investors can forecast their returns over time and hence can calculate the value of their investment. If there is regime stability, then there is minimal risk of wholesale changes in the way the government regulates the industry—the most extreme type of change being the denial of property rights, or expropriation. We argue that three characteristics of the regulatory process are, in turn, important determinants of regulatory predictability: agenda control, reversionary regulatory policy, and veto gates. Moreover, regime stability is also, in part, a function of these three characteristics. We examine our theory of political risk and regulatoty commitment by comparing the cases of Argentine and Chilean electricity investment and regulation.     

RULE RATIONALITY

We study the strategic advantages of following rules of thumb that bundle different games together (called rule rationality) when this may be observed by one's opponent. We present a model in which the strategic environment determines which kind of rule rationality is adopted by the players. We apply the model to characterize the induced rules and outcomes in various interesting environments. Finally, we show the close relations between act rationality and “Stackelberg stability” (no player can earn from playing first).