EQUALITY OF OPPORTUNITY: EAST VS. WEST GERMANY

The case of German reunification has been subject to extensive research on earnings inequality and labour market integration. However, little is known about the development of equality of opportunity (EOp) in East and West Germany after 1990. Using German micro data, we empirically analyse how circumstances beyond the sphere of individual control relate to inequality in East and West Germany. Our results show that EOp is larger in East than in West Germany. However, despite increasing income inequality, EOp remained surprisingly constant.     

Payments for agrobiodiversity conservation services: An overview of Latin American experiences,lessons learned and upscaling challenges

Many developing countries face a major challenge today: how to safeguard the biodiversity maintained in the fields of the rural poor - which constitute a national and global public good - whilst meeting those same people's development needs and rights? A solution to this dilemma has thus been sought in adapting the design and implementation of Payments for Ecosystem Services (PES) concepts to the conservation of agrobiodiversity.Here we review the application of nine such Payments for Agrobiodiversity Conservation (PACS) schemes that have been applied to date in four Latin American countries over the period 2010–2018. These covered 130 threatened varieties across a number of major food crops, and involved over 100 farming communities and 1,100 farmers (45 % of which were women). Conservation service offers were received through a competitive tender mechanism. Average bid offers revealed high heterogeneity, varying between US$675/ha. to ten times as much.In relation to issues identified as key to PES, such as spatial targeting, differentiated payments and conditionality, the underlying design of the PACS schemes may be considered solid. PACS-related prioritisation processes allow for the a priori identification of sites with high ecosystem service densities and high threat levels. The use of competitive tenders permits accounting for cost heterogeneity in the provision of conservation services and for payments to be differentiated. Conditionality is strong.In terms of implementation, a “back of the envelope” calculation based on the results of the competitive tenders suggests that conservation costs are modest. For a priority conservation portfolio of 100 varieties (which may be from different crops) each with a target area of five hectares, costs would amount to just under US$860,000 over twenty years or US$70,000 p.a. at a 5 % discount rate. The small-scale and one-off nature of the interventions realised to date, along with threatened crop variety seed availability constraints, have however meant that environmental effectiveness has been incomplete in the short-term (area cultivated with specific threatened varieties increased, but still below the “not at risk” threshold). The establishment of systematic monitoring systems is required to determine longer-term impacts and inform more regular PACS interventions within a dynamically evolving systems context.     

Pains and gains of environmental management system certification for the sustainable development of manufacturing companies: Heterogeneous effects of industry peer learning

Environmental sustainability is a growing global concern. Environmental management systems (EMS) could be an effective strategic tool to help firms deal with their sustainable development. However, whether EMS certification pays off financially and how it takes effect can be debated. Thus far, these questions remain largely under‐researched. In particular, the effects of EMS certification on financial performance are inconclusive, and the reasons explaining the effects are underdeveloped. This study aims to enrich the current research by exploring the mediating and moderating roles from the perspective of cost‐efficiency trade‐offs to reveal how EMS certification affects financial performance. Applying a PROCESS procedure analysis and causal mediation analysis to a sample of 1,751 Chinese listed manufacturing firms from 2008 to 2016, this study shows that the effect of EMS certification on firms' financial performance is insignificant because their operating costs burden increases while their marketing efficiency and managerial efficiency improve. For the first time, this study demonstrates the moderating role of industry peer learning, as the mediating effects decrease with the growth of industry peer learning.     

The determinants of employers’ use of temporary contracts in the frictional labor market

This paper focuses on the following two primary reasons that employers use temporary contracts: to flexibly adjust employment and to screen workers. A search-matching framework is used to not only address employers’ endogenous choices in using temporary contracts, but also numerically identify the situations in which these contracts are likely to be used as a screening tool for permanent positions. This numerical exercise demonstrates that reducing employment protections in permanent jobs, reducing benefits for unemployed workers and raising the conversion probability from temporary to permanent employment will increase the relative proportion of employers who use temporary contracts as a screening device.     

Who should sell stocks?

Never selling stocks is optimal for investors with a long horizon and a realistic range of preference and market parameters, if relative risk aversion, investment opportunities, proportional transaction costs, and dividend yields are constant. Such investors should buy stocks when their portfolio weight is too low and otherwise hold them, letting dividends rebalance to cash over time rather than selling. With capital gains taxes, this policy outperforms both static buy‐and‐hold and dynamic rebalancing strategies that account for transaction costs. Selling stocks becomes optimal if either their target weight is low or intermediate consumption is substantial.     

What explains the value premium? The case of adjustment costs,operating leverage and financial leverage

This paper empirically examines and compares the different theoretical predictions on how adjustment costs, operating and financial leverage influence the value premium. Consistent with Ozdagli (2012), financial leverage plays a dominant role, supported by adjustment costs (which represent the degree of investment irreversibility). Specifically, the observed value premium is driven by the financial leverage differences between value and growth firms, partially neutralized by investment irreversibility. The relation between the value premium and investment irreversibility is contrary to the intuition in Zhang (2005) and Cooper (2006). Operating leverage does not significantly influence the value premium.     

Identifying business opportunities for sustainable development: Longitudinal and experimental evidence contributing to the field of sustainable entrepreneurship

Which factors facilitate the identification of business opportunities for sustainable development? To answer this question, we develop a process model of sustainable opportunity identification. We argue that sustainable opportunity identification is a process with transitions from problem to solution identification and from solution to sustainable opportunity identification. Moreover, the transitions are facilitated by two factors—awareness of adverse consequences and entrepreneurial attitude—providing motivation and direction in the process. We tested our model in a field study (N = 107) and two experiments (N = 53 and N = 69). Our findings show that awareness of adverse consequences and entrepreneurial attitude influence the process of sustainable opportunity identification, explaining under which conditions people are more likely to identify business opportunities for sustainable development. Our study thus contributes to the field of sustainable entrepreneurship.     

A gramscian perspective on field dynamics. The case of the privatization of Italian steel industry

Institutional fields are not static, they undergo times of fragmentation and times of settlement. Neo-institutional research has long explained the settlement of fields as either the effect of political manoeuvring of actors, or of discursive activity influencing cultural codes, narratives and symbols. But can these processes really be considered in isolation? In this paper, we propose to adopt a comprehensive view on fields’ dynamics, one that embraces the interaction of political and discursive manoeuvring to explain how fragmented fields manage to settle. To do so, we build on the Gramscian concept of hegemonic practices as discursive and political processes that integrate cultural equivalence among actors with political alliances based on aligned interests. Hegemonic practices align actors in a new historical bloc (a new settlement). Through this lens, we interpret the case of the Italian State steel privatization (1984–1995) and propose a process model explaining what yields fields’ dynamics from fragmentation to settlement. The model highlights the action of diffused agency in field dynamics, thus overcoming the obsolete challenger/incumbent view, and the need of becoming a historical bloc for alliances to stabilize a field.     

Considering the nuclear option: Hidden benefits and social costs of nuclear power in the U.S. since 1970

Although burning fossil fuels has environmental consequences, many countries have switched away from nuclear power in favor of fossil-fuel fired electricity production after incidents at Three Mile Island, Chernobyl, and Fukushima. This study estimates the substitution between nuclear and fossil-fuel fired electricity generation in the United States. Using an event-study framework, we leverage nuclear plant openings from 1970 to 1995 and forced nuclear plant outages from 1999 to 2014. Plant openings (nuclear outages) reduce (increase) monthly net coal-fired generation by approximately 200 GWh, implying a considerable reduction (increase) in emissions. We find that the substitution between nuclear and coal is not one-to-one, as has been assumed in prior literature. After establishing these stylized facts, we explore the potential underlying forces driving the observed substitution between coal and nuclear.     

Institutional Economics as Theory of Policy Change: Impact of Past Policy Failures on Present Policy

Social scientists have developed several theories for understanding or evaluating policy change over time. Since all costs or benefits are not internalized owing to positive transaction costs, policymaking is always implemented under cost underestimation conditions and, therefore, is imperfect. I call this trait policy failure in this article. Furthermore, I show that a new framework combining the social costs approach and the legal/economic approach in institutional economics is suitable and can be applied to evaluating how past policy failures affect present policy, providing as an example the Fukushima nuclear disaster in Japan.