Single currency and fiscal performance: the early Euro Area in perspective

We examine how exchange rate regimes affect fiscal discipline by investigating European countries as they transitioned from flexible to fully fixed exchange rates under the Euro. We apply the synthetic control method to estimate, for each Eurozone country, its counterfactual budget stance under flexible rates. Our evidence strongly suggests that fixing exchange rates negatively impacted negatively fiscal discipline. However, effects were not homogeneous, as they were mediated by political factors. For example, countries where policymakers faced a longer political horizon and operated within a more cohesive political environment, managed to perform better in terms of fiscal discipline.     

Medication,equipment, and supply costs for common interventions providing extended post-surgical analgesia following total knee arthroplasty in US hospitals

Aims: To estimate the cost to hospitals of materials (i.e. medications, equipment, and supplies) required to administer common interventions for post-surgical analgesia after total knee arthroplasty (TKA), including single-injection peripheral nerve block (sPNB), continuous peripheral nerve block (cPNB), periarticular infiltration of multi-drug cocktails, continuous epidural analgesia, intravenous patient-controlled analgesia (IV PCA), and local infiltration of bupivacaine liposome injectable suspension (BLIS).

Materials and methods: This analysis was conducted using a mixed methods approach combining published literature, publicly available data sources, and administrative data, to first identify the materials required to administer these interventions, and then estimate the cost to the hospital of those materials. Medication costs were estimated primarily using the Wholesale Acquisition Costs (WAC), the cost of reusable equipment was obtained from published sources, and costs for disposable supplies were obtained from the US Government Services Administration (GSA) database. Where uncertainty existed about the technique used when administering these interventions, costs were calculated for multiple scenarios reflecting different assumptions.

Results: The total cost of materials (i.e. medications, equipment, and supplies) required to provide post-surgical analgesia was $41.88 for sPNB with bupivacaine; $756.57 for cFNB with ropivacaine; $16.38 for periarticular infiltration with bupivacaine, morphine, methylprednisolone, and cefuroxime; $453.84 for continuous epidural analgesia with fentanyl and ropivacaine; $178.94 for IV PCA with morphine; and $319.00 for BLIS.

Limitations: This analysis did not consider the cost of healthcare providers required to administer these interventions. In addition, this analysis focused on the cost of materials and, therefore, did not consider aspects of relative efficacy or safety, or how the choice of intervention for post-surgical analgesia might impact outcomes such as length of stay, re-admissions, discharge status, adverse events, or total hospitalization costs.

Conclusions: This study provided an estimate of the costs to hospitals for materials required to administer commonly used interventions for post-surgical analgesia after TKA.     

Upgrading in China’s apparel industry: international trade,local clusters and institutional contexts

This article focuses on the concept of upgrading, and seeks to move away from a firm-centred approach of industrial upgrading towards a framework that recognises not only a firm’s integration into global value chains, but also its embeddedness within local networks and the context of wider institutional arrangements. Based on one firm-level database, this article measures upgrading in China’s apparel industry at the firm level, which allows us not only to evaluate the extent of upgrading in the industry as a whole and to compare its extent among individual firms and selected groups of firms, but also to differentiate and measure different types of upgrading. Empirical results confirm that the heterogeneity of firms, global and local linkages and the wider historical, political, institutional and economic context have all played a critical role in the process of upgrading, suggesting that a focus on dynamics of firm upgrading alone is insufficient.     

Local government type and municipal bond ratings: what’s the relationship?

There is an extensive literature analysing the executive branch within local U.S. government jurisdictions. This has largely revolved around the differences between elected mayors and appointed city managers. Much of the academic work has considered the potential efficiency gains that may be associated with either form of government and comparative analyses between the two. However, the empirical literature has been divided regarding the relative efficiency of either form. This article attempts to add to that literature by considering how bond markets may perceive potential efficiencies that emerge from one executive type over the other by evaluating bond ratings for a sample of large municipal governments in the United States. Overall, the results suggest that municipalities headed by a city manager are associated with increased bond ratings (and thus lower borrowing costs), which may lend support that this form of administration is, on some margin, relatively more efficient than others. These results are robust to a number of specifications.     

Vested Interests and the Common Man as Seen Through Monetary and Fiscal Policy: Flooding Wall Street or Main Street?

There are many angles through which a critical observer can analyze the divergent class interests in most aspects of macroeconomic management. We examine the insistence of financial authorities of all major economies on reviving economic activity through monetary — and not fiscal — policy as a particularly clear example of favoring vested interests over the interests of the common man. Nearly a century after Thorstein Veblen wrote on the subject, one can find many parallel elements to the political landscape of the times. Today, the common man is often expressed by the “99%,” and many accept that the dominant vested interest is that of global banks. Unlike in Veblen’s times, economists today have many historical experiments in economic management that they can consult. By employing logic, historical experience, and an understanding of our current global finance-led capitalism, we offer a preliminary institutionalist analysis of the mechanisms of current monetary policy that “flood” Wall Street, while leaving employment, production, and investment — Main Street — all but forgotten. We then explain how vested interests have abandoned fiscal policy and left a deflationary macroeconomic environment.     

Effects of government spending shocks in China,Japan, and Korea

ABSTRACT

This study investigates the effects of government spending shocks on various key macro variables in China, Korea, and Japan using structural VAR models. The main empirical findings are as follows. Government spending multipliers of all three countries are far larger than 1 in recent years. The effectiveness of fiscal expansion has not changed markedly in China but substantially increased in Korea (after the Asian financial crisis) and Japan (during zero lower bound period). Increases in the effectiveness of fiscal expansion are associated with changes in the monetary and exchange rate policy regimes and institutions of these countries. Among the three countries, the government spending multiplier is relatively large in China but relatively small in Japan in recent years. Although the effects on exchange rate and trade balance vary across countries and sample periods, real exchange rate tends to depreciate, whereas trade balance tends to improve under flexible exchange rate regimes. Some empirical findings are consistent with standard theory, but others are not.

Abbreviations: NK: New Keynesian VAR: Vector Autoregressive ZLB: Zero Lower Bound     

Modeling economic systems as locally-constructive sequential games

Real-world economies are open-ended dynamic systems consisting of heterogeneous interacting participants. Human participants are decision-makers who strategically take into account the past actions and potential future actions of other participants. All participants are forced to be locally constructive, meaning their actions at any given time must be based on their local states; and participant actions at any given time affect future local states. Taken together, these essential properties imply real-world economies are locally-constructive sequential games. This paper discusses a modeling approach, Agent-based Computational Economics (ACE), that permits researchers to study economic systems from this point of view. ACE modeling principles and objectives are first concisely presented and explained. The remainder of the paper then highlights challenging issues and edgier explorations that ACE researchers are currently pursuing.     

REVISITING GLOBALIZATION CHALLENGES AND OPPORTUNITIES IN THE DEVELOPMENT OF COOPERATIVES

Cooperatives have gained prominent attention in recent years as strategic elements to achieve sustainable economic development and greater social cohesion in the context of neoliberal globalization. This article explores, theoretically, the current challenges and opportunities for cooperatives to develop successfully in the globalizing economy. To this end, we provide an analytical, critical review of the key bibliography concerning some fundamental aspects that shape the relationship between economic globalization and cooperatives, an issue that has been generally neglected by previous literature. Three key fields are addressed: 1) the viability of cooperatives, based on their strengths and possible weaknesses, under current globalization; 2) the role of these organizations in promoting the local development and stability of local communities; and 3) the tensions and potentialities that internationalization entails for cooperatives. Based on the analytical review and the organization of the literature, we propose an agenda for further research. This includes some hypotheses and strategies for testing them that would be essential to assess the role of cooperatives in economic globalization, and sheds light on key areas for future research that could provide a better understanding of the complexity surrounding the relationship between globalization and cooperatives.     

Fiscal Equalization and Tax Enforcement

In many countries organized as federations, fiscal equalization schemes have been implemented to mitigate vertical or horizontal imbalances. Such schemes usually imply that the member states of the federation can only partly internalize (marginal) tax revenue before redistribution. Aside from the internalized marginal revenue, referred to as the marginal tax‐back rate, the remainder is redistributed. We investigate the extent to which state‐level authorities in such federation under‐exploit their tax bases. By means of a stylized model, we show that the member states have an incentive to align the effective tax rates on their residents with the level of the marginal tax‐back rate. We empirically test the model using state‐level and micro‐level taxpayer data, OLS regressions and natural experiments. Our empirical findings support the results from our theoretical model. Particularly, we find that states with a higher marginal tax‐back rate exploit the tax base to a higher extent.     

地方政治权力转移与企业社会资本投资周期--基于政企关系重构的动态研究

文章以2007－2012年我国A 股上市公司为样本,从政企关系重构的视角研究了地方政治权力转移对企业社会资本投资的影响。研究发现：(1)在地方政治权力转移当年,企业会显著提高社会资本投资力度。随着主政官员任期的增加,企业社会资本投资呈现下降趋势。这说明在主政官员任期内,企业社会资本投资呈现先增后减的周期性特点。这种周期性特点仅在民营企业中存在。(2)民营企业社会资本投资的周期性特点在地方官员来自外地、继任官员预期任期较长、管制行业以及融资约束程度高和无政治关联的企业样本中更加显著。(3)在地方政治权力转移当年,民营企业提高社会资本投资力度能够帮助其获得政府补助,但这种优势并不会立刻体现出来;同时,企业提高社会资本投资力度也会对自身的研发投入产生挤出效应,且挤出效应持续存在于继任官员的整个任期中。文章的研究为理解企业建立政企关系的手段、过程与效果提供了新的视角。