Professional associations and their members: A study of the market for professional services when ability and size are independent

The members of a professional group are organized in an association which influences ability requirements and size in order to keep either the price, its own revenues or the members' incomes as high as possible. Ability is, contrary to earlier approaches, treated as a matter of education rather than selection. The members are free to set quantity and/or price in order to maximize income. The association incentive to influence size and ability is shown to depend on how demand elasticity changes with these variables. New types of misallocations such as ‘exclusive incompetence’ may emerge.     

Variable importance by partitioningR 2

One purpose of many regression studies is to compare the relative importance of the independent variables. Several different measures have been used to measure importance:t-values, standardized regression coefficients, elasticity, commonality analysis, increment inR ², correlation coefficients, hierarchical partitioning etc. Some of these measures have the common feature of partitioningR ² between the independent variables and assess their importance according to their contribution toR ². This paper is an attempt to clarify the advantages and disadvantages with these different methods and find out if any useful information can be gained by a partitioning ofR ².     

British discretion in Dutch planning: Establishing a comparative perspective for regional planning and local development in the Netherlands and the United Kingdom

Regional planning and development is continuing to take an important role in planning agendas throughout Europe. In the United Kingdom (UK), the planning system has been reformed during the last decades, marking a noticeable shift from a development-led towards a more plan-led system. In the Netherlands, strictly regulated growth-control policies have been abandoned to some degree, in favor of more decentralized planning policies featuring negotiated development. Dutch planners have been specifically interested in a more British approach, that is, a more discretionary and development-led type of approach to spatial planning. In this paper, we will discuss current efforts in Dutch regional planning to adopt new principles for planning delivery and will provide a comparative perspective between spatial planning in the UK and the Netherlands. This paper discusses the changing structure of planning delivery in both countries. At the same time, it establishes a framework for identifying critical lessons for Dutch regional planning practice as opposed to planning in the UK. Three characteristics are pivotal for the comparison: (1) the establishment of comprehensive principles for project coordination; (2) options for the settlement of planning gain, packaging interests, and regional redistribution; and (3) the institution for development-oriented planning and discretion for planning decisions. The evidence used is based on a literature review of recent debates in both countries and illustrative cases, including the Dutch ‘Heart of the Heuvelrug’ plan.     

Pricing and Capital Allocation for Multiline Insurance Firms

We study multiline insurance companies with limited liability. Insurance premiums are determined by no‐arbitrage principles. The results are developed under the realistic assumption that the losses created by insurer default are allocated among policyholders following an ex post, pro rata, sharing rule. In general, the ratio of default costs to expected claims, and thus the ratio of premiums to expected claims, vary across insurance lines. Moreover, capital and related costs are allocated across lines in proportion to each line's share of a digital default option on the insurer. Our results expand and generalize those derived elsewhere in the literature.     

Investment with weak contract enforcement: evidence from Hungary during transition

This paper aims to provide empirical evidence relating to theimportance of contract enforcement for development. Survey dataon Hungarian farms are used to estimate the impact of contracthold-ups on investment. We find that investment is affectedby a variety of factors. Contract breaches in the form of delayedpayments have a non-linear effect on investment: at high levels,they significantly deter the investment, but not at low levels.     

A Model of Reputation in Cheap Talk*

We study a dynamic game of advice where the sender's preferences are unknown to the receiver. The novel feature of the model is that there is more than one type of biased sender. We show that the more equal the proportions of different biases in the sender population, the greater the credibility of the information transmitted. Somewhat surprisingly, however, we also find that the receiver does not benefit from this equality. We discuss our results in the context of political lobbying and show that institutions that increase transparency lower lobbyists' incentives for truthtelling, but unambiguously promote the policymaker's welfare.     

Industrial Policies and the Macroeconomic Effects of Taxation: some comments

Comments are made by Amable & Petit (1996), which examines industrial policies, and by Mair & Laramie (1996), which examines taxation policies. Agreement is found with both papers that modern Keynesian policy has much to offer in these two areas beyond what is generally presumed. Expectations formation is pointed to as one area that both these papers should more explicitly incorporate in their arguments. Similarly, regional considerations and ‘location competition’ are held to be important considerations. The role of finance is pointed to as a fundamental Keynesian consideration that needs to be addressed in effectively formulating industrial and taxation policies.     

Summits,Riots and Media Attention: The Political Economy of Information on Trade and Globalisation

Supply of information has increased rapidly through the growth of commercial media and technological innovations. Yet economists still blame anti‐globalists’ demonstrations and public opposition to trade liberalisation on poor information. This paper analyses how the structure of the media industry affects the distribution of information on trade policy and globalisation. We present an empirical analysis of Belgian media reporting on trade policy and globalisation over the 1999–2002 period, supports these hypotheses and finds strong negative bias in media coverage. Moreover, we find that media coverage of trade policy and globalisation is highly concentrated around summit meetings of political leaders. Media attention in the popular press is heavily influenced by riots and demonstrations at summits. The paper points at important implications for public information on trade policy and globalisation and for economists.