Gut issue

Unions are willing to strike over it, and companies are ready to draw the line, too. Now both sides are turning to Congress to fix the health insurance mess. This is the first of two articles on responses to the growing health care crisis. A report on state efforts begins on p. 708.     

The measurement of marketing efficiency in the presence of spillovers: theory and evidence

We develop a model of marketing efficiency based on a directional distance function that allows for marketing spillovers. A parametric model is used to test for spillovers from rival marketing and from a firm's marketing activity of its other related products. We then show how this information can be incorporated into a non‐parametric model and used to estimate marketing inefficiency. We apply brand level data from the US brewing industry to the non‐parametric model to determine the effectiveness of television, radio, and print advertising. We find that advertising spillovers are important in brewing and show that efficiency estimates are inaccurate when spillover effects are ignored. Our results also suggest that marketing efficiency may be an important component to firm success in brewing, a result that may apply to other consumer goods industries. Copyright © 2006 John Wiley & Sons, Ltd.     

Bridges over contested terrain: Exploring the radical account of the employment relationship

Richard Edwards' account of the transformation of the employment relationship in the twentieth century is used as a vehicle for integrating the radical analysis into the more conventional treatment. Most non-radical analyses rely on idiosyncratic skills to explain the existence of job security and other features of the modern employment relationship. Here an alternative explanation is proposed and some of its implications are explored.     

Analysis and Forecast of the State of Environmental Protection in Russia

The main purpose of the present study is to analyse the emission dynamics of atmospheric and water pollutants in Russia and cost of their removal in the 1980s and early 1990s, and to forecast them by means of a Dynamic Input–Output Model according to different scenarios of future economic development till 1998. Main results of the work are:– methodological principles have been elaborated for singling out the environmental protection sector within the national economy;– a method has been offered for including the ecological block into a Dynamic Input–Output Model of the Russian economy;– a method of data preparation has been elaborated for the ecological block of the above-named model, the data base which characterizes the ecological situation in Russia has been formed and analysed;– calculations for 1994–1998 have been executed for forecasting the economic and ecological development of Russia using the above-mentioned model and the results obtained have been analysed. The results showed that if the existing tendencies towards low environmental protection capital costs remain the same, then the negative environmental impact will increase. In order to implement ecological programs and international agreements, to increase the proportion of removed pollutants, it is necessary to increase substantially expenditures on purifying water and air resources. The proportion of environmental protection investments in the total amount of the national economy capital costs should increase by up to 12–40% according to different scenarios of the economic development and different purposes of the environmental protection policy.     

Using Similarity Analyses to Scale Out Research Findings Across Andean Watershed Basins

Abstract

Strategic research in agriculture and natural resources carried out by international research centers is deemed a public good and should, sooner or later, be put into the hands of development, governmental and non-governmental organizations. However, this research is usually done at specific pilot sites; there is a greater need to know how representative those sites are in relation to the diversity of contexts in other locations. Such is the case with the Challenge Program on Water and Food (CPWF), a global initiative in water research promoted by the Consultative Group on International Agricultural Research (CGIAR), which is developing and implementing strategic research in nine basins located in the tropics of Africa, Asia and South America. Given that resources are not available to collect data from the whole of the region, pilot sites are needed. It is hoped that research outputs obtained in the selected pilot sites can be the basis for scaling out solutions to similar situations in neighbouring or adjacent areas in same or different basins.

In order to contribute to the scaling-out process, different classification methodologies were applied to determine how specific watershed basins are representative of larger areas. The Andean eco-region served as a case study but the methods can easily be applied in other regions. The spatial diversity of biophysical and social conditions across the Andes requires careful site selection. Two methods, a combination of Weight of Evidence (WofE) and Logistic Regression (LR) methods and Fast Cluster analysis, were used to determine the similarity of selected sites with those excluded. A 1-km study resolution covering most of the Andes eco-region included annual rainfall, elevation, length of growing period, land cover, roads and population density as the key variables. Results showed complementarities between the two methods in presenting a probability surface of similarity across the Andes and a clustering of similar sites inside and outside the pilot basins. The output information forms a strong basis for devising plans to scale out research findings from the pilot basins to the whole region.     

ECONOMIC RECESSIONS,BANKING REFORM AND THE FUTURE OF CAPITALISM1

In the 2010 London School of Economics and Political Science Hayek Memorial Lecture, the author argues that flaws in the design of the monetary and financial system were responsible for the global financial crisis and the subsequent recession. The crash reflected the unsustainable nature of the bubble induced by artificial credit expansion created by fractional‐reserve banking under the direction of central banks. Such boom–bust cycles will continue until radical reforms are implemented, including a 100% reserve requirement for demand deposits.