Export Market Performance of OECD Countries: An Empirical Examination of the Role of Cost Competitiveness

We investigate the relationship between export market shares and relative unit labour costs using a long panel of 12 manufacturing industries across 14 OECD countries. We ask how sensitive are export market shares to changes in relative costs and what determines this sensitivity? Both costs and embodied technology are important, but neither can fully explain changing export positions. We explore whether residual country-specific trends might be linked to 'deep' structural features of economies. Sensitivity to labour costs is lower in high tech industries and core ERM countries. Industry elasticities have increased, especially in industries subject to increasing product market competition.     

Pricing Policy Under Double Market Power: Madagascar and the International Vanilla Market

This paper uses a price-leadership model of the international vanilla market to study the welfare consequences of alternative pricing policies for Madagascar, the leader, that also controls domestic production through a single-channel marketing system. Econometric estimates of the model are used for simulations of welfare and revenue changes and internal redistribution of income. Results indicate that Madagascar could have gained between 0.9% and 2.6% of GDP per year on average over the period 1981–91 by following optimal pricing policies, and that producers were overtaxed suggesting that political economy considerations played a role in the pricing decisions.     

Determinants of financial distress and bankruptcy in highly levered transactions

Prior literature on highly levered transactions (levered buyouts or levered recapitalizations) has emphasized either changes in governance or the structuring of their financing in helping these firms avoid financial distress or bankruptcy. Observing a sample of HLTs over time, we observe that debt composition is a more critical influence than proposed changes in governance for the likelihood of an HLT avoiding financial distress or bankruptcy. Such evidence is consistent with the [Chemmanur, T. & Fulghieri, P. (1994). Reputation, renegotiation, and the choice between bank loans and publicly traded debt. Review of Financial Studies 7, 475–506] model and suggests that the critical factor is the ability to informally renegotiate debt terms with a few lenders.     

The effects of the minimum wage in Brazil on the distribution of family incomes: 1996–2001

The Brazilian economy has long relied on the minimum wage, having first implemented a minimum in 1940. Shortly after taking office in 2003, Brazil's President raised the minimum wage by 20% and promised to double the value of the minimum wage before his term ends in 2006. The usual rationale for minimum wage increases is to bring about beneficial changes in the income distribution, by raising incomes of poor and low-income families. The goal of this paper is to evaluate the efficacy of the minimum wage in Brazil in bringing about these changes in the income distribution. We examine data drawn from Brazil's major metropolitan areas, studying the years after Brazil's hyper-inflation ended. The estimates provide no evidence that minimum wages in Brazil lift family incomes at the lower points of the income distribution; if anything some of the evidence points to adverse effects on lower-income families.     

Common (stock) sense about risk-shifting and bank bailouts

If a bank is facing insolvency, it will be tempted to reject good loans and accept bad loans so as to shift risk onto its creditors. We analyze the effectiveness of buying up toxic mortgages in troubled banks, buying preferred stock, and buying common stock. If bailing out banks deemed “too big to fail” involves buying assets at above fair market values, then these banks are encouraged ex ante to gamble on bad assets. Buying up common (preferred) stock is always the most (least) ex ante- and ex post-efficient type of capital infusion, regardless of whether the bank volunteers for the recapitalization.     

Abusive work practices and bullying among chefs: A review of the literature

Discussion in the media suggests that bullying and abuse are rife in commercial kitchens. This paper analyses the issue of abusive work practices among chefs through a review of the literature; it examines the possible causes of bullying and abusive behaviour in the industry and argues that personal characteristics, culture and socialisation, and the transient nature of the industry, may offer some explanations as to why abusive behaviour is tolerated.Evidence from the literature suggests that abuse may be an expected part of the culture of a commercial kitchen; this is supported by both historical and social structures including education and training systems.In conclusion, research into abusive behaviour among chefs has been limited and further research into its true extent, and how it becomes tolerated, would be useful.