A political economy model of immigration quotas

The paper examines a model in which the number of immigrants allowed into a country is the outcome of a costly political lobbying contest between a firm and a union. The union and the firm bargain over the wage of natives after the number of immigrants that will be permitted is known. I assume that the lobbying contest is an all-pay auction (i.e., the lobbyist with the higher effort wins with certainty). Comparative statics results are derived to show how the reservation wage of immigrants, the price of the firms product, the size of the union and the cost of lobbying affect immigration quotas and the post-immigration wage of natives.Received: 4 June 2003, Accepted: 23 June 2004 JEL Classification: D72, D73, J5, J61I thank the editor, Amihai Glazer, Don Devoretz, Dan Usher, and three anonymous referees for helpful comments. My thanks are especially due to Doug Allen and Gordon Myers who supervised this work as part of my doctoral thesis at Simon Fraser University, Canada. An earlier version of this paper was circulated as RIIM working paper #00-01, Simon Fraser University, Canada and also presented at the 2001 meetings of the Canadian Public Economics Study Group in Montreal, Canada.     

Raising the bar (8)

This editorial summarizes the papers published in issue 13(3) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper challenges the home market hypothesis that large countries host more firms relative to their size than small countries by considering the lobbying activities of multinational firms. The second paper analyzes the implications of a spatial weight matrix used to estimate a spatial econometric model that depends on an endogenous economic variable. By adding a spatial context, the third paper provides a novel contribution to the literature on international norms in de facto measures of human rights performance. The fourth paper examines the determinants of accepting informal work in Poland. The fifth paper deals with non-stationarity and cointegration in a dynamic spatial econometric panel data model when the number of observations in the time – rather than in the cross-sectional– domain tends to infinity.     

Bending the rules,breaking the rules: How corruption and lobbying affect the investment market selection of Swedish firms

There is stark evidence that many policies which influence firm gains from engaging in FDI (such as tax and trade policies) are targeted by lobbying groups and that corruption can be an important determinant of market attractiveness. The scarce research that exists on firm behaviour, corruption and lobbying shows that these activities can be regarded as alternative, and interdependent, influence forms. This paper provides the novel contribution of investigating how the market infiltration of corruption and lobbying affects the firm's investment decision. We identify the interdependent effects using census data for Swedish manufacturing firms that allows a complete identification of the firm's market selection. Our results reveal that these private–public sector links influence the firm's investment decision differently, as market selection is deterred by corruption and stimulated by lobbying, and that they function as substitutes. We show that the stimulating lobbying effect largely can be attributed to its interdependency with corruption, which suggests that firms are more shielded from corruption in lobbying environments. Further investigation reveals that the corruption and lobbying effects are not always representative of larger firms: The largest firms are undeterred by corruption in markets where lobbying forms an integral part of the business environment and larger firms are not stimulated by lobbying in markets largely void of corruption.     

Inside the Black Box of IASB Standard Setting: Evidence from Board Meeting Audio Playbacks on the Amendment of IAS 19 (2011)

We provide evidence on the little researched internal sphere of private IASB standard setting, more specifically, on the dynamic of board discussions and the respective impact of exogenous input such as comment letters, the array of arguments evoked in IASB debates, individual board member contribution and board-staff relations. We conduct a content analysis of audio recordings of 14 IASB meetings on the amendment of IAS 19 Employee Benefits (2011) between November 2008 and February 2010. Our main findings comprise the argument-based handling of comment letters not being conditioned by the political or economic importance of the senders, the gatekeeper role of staff members in channelling exogenous input and their equal role in board discussions and the dominant reference to conceptual arguments there. We also point to the heterogeneous involvement of board members, their different attribution to key issues and to further observations regarding the meeting governance, board’s discussion culture and etiquette. Our paper adds to the literature on private IASB standard setting, pension accounting and group decision making.

Data: All data are available from the public sources identified in this paper     

Lobbying and tax competition in an oligopolistic industry: a reverse home-market effect

This paper studies tax competition between two asymmetrical countries for an oligopolistic industry with many firms. Each government sets its tax rate strategically to maximize the weighted sum of residents’ welfare and political contributions by owners of firms. It is shown that if the governments care deeply about contributions and trade costs are low, the small country attracts a more than proportionate share of firms by setting a lower tax rate. The well-known home-market effect, which states that countries with a larger market attract a more-than-proportionate share of firms, may be reversed as a result of tax competition by politically interested governments.     

中国企业集团多样化经营战略研究——西方近期研究成果之借鉴

Lang和Stulz (1994 ) ,Berger和Ofek (1995 )以多样化企业集团的市场价值与集团各部门所在行业中所有单一企业组合的价值之和相比较,发现企业进行多样化经营后会降低其价值。由此,引发了西方理论界对多样化经营同企业价值间关系的大讨论。目前,中国的企业集团正蓬勃发展,随着企业集团的不断强大,企业过剩的资本会流向不同的产业部门,形成多样化集团。中国作为新兴的市场,与西方的成熟市场不一样。所以在借鉴西方理论以及研究成果为我所用的同时,更要结合中国的实际情况,提出切合实际的中国企业集团多样化经营战略。     

Policy takers or policy makers? The lobbying of global banking regulators

Do financial sector groups act as passive policy takers, or do they ‘shape’ the policies to which they are subject? This article responds to this question with three arguments pertaining to the policy shaping power of the financial industry when it comes to international financial standards. First, industry groups confront a number of additional challenges when it comes to lobbying international regulatory bodies, which tend to be more opaque in their decision making and more difficult to hold accountable when they make unpopular decisions. Second, while these groups are sometimes able to shape financial regulatory policy, the extent of this influence is more partial and contingent than most depictions suggest. The third argument advanced is that since the global financial crisis, business groups have had many of their traditional lobbying tools adversely affected, making lobbying a more uphill battle than before. Financial industry groups are able to influence the governance of their own activities and act as ‘policy shapers’ some of the time, but are less strongly positioned in this role than many existing depictions seem to suggest.     

The political economy of environmental and social security policies: the role of environmental lobbying

Social security provides retirement benefits to the old at the expense of the working young, while environmental investment benefits the future of the young at the expense of the old. This paper presents a model incorporating this intergenerational conflict on public spending and considers the political determination of environmental investment and social security by focusing on the Markovian political equilibria. It is shown that (1) the political equilibria are generally inefficient, and (2) the introduction of environmental lobbying into politics may improve environmental quality but degrade lifetime utility in the long run.      

会计准则制定程序的博弈分析——以美国和欧盟为例

近年来，政治行为已经成为会计准则制定过程中的一个重要议题。以美国和欧盟为例，从博弈论角度对会计准则制定过程中的政治过程进行深入分析，发现美国和欧盟的会计准则制定主体——FASB和IASB遵循一个极为相似的程序，但它们却被植入了截然不同的政治环境中。对于一个相似的新会计准则，即使两个会计准则制定主体有着极为相似的偏好，其结果也将迥然不同。