Social dialogues—the state of the art a decade after Maastricht

The article asks whether social dialogues, according the procedures of the Social Protocol and the Amsterdam Treaty, have proved to be valuable instruments able to make major contributions to the development of social integration. More recent developments at the inter‐professional as well as at the sectoral level are evaluated. Furthermore, major trajectories for likely future trends at both levels are highlighted. The final part discusses the problem of whether social dialogues will profit from the introduction of new modes of governance, especially the more recently preferred open method of co‐ordination.     

Across-the-Curve Credit Spread Indices

We design a novel across-the-curve credit spread index, AXI, a measure of the recent cost of wholesale unsecured debt funding for publicly listed US bank holding companies and commercial banks. AXI, a benchmark for bank lending and risk management, is the weighted average of credit spreads for unsecured debt instruments with maturities ranging from overnight to five years, with weights that reflect both transaction and issuance volumes. We provide illustrative output of the bond-based component of AXI. By widening coverage to include all corporate debt issuers, we also build a financial conditions index (FXI).     

Costs, Institutional Mobility Barriers, and Market Structure: Advertising Agencies as Multiproduct Firms

What accounts for the diversity and limited concentration that has long characterized the organization of the advertising agency industry? This question is addressed by treating an advertising agency as a multiproduct firm. The firm's product line or service mix is defined in terms of the set of different media categories where an agency places the advertising messages that it creates on behalf of its clients. Evidence is presented indicating that the structure of demand and costs in the advertising agency industry conforms to the conditions that MacDonald and Slivinski showed were required for an industry to sustain an equilibrium with diversified firms. Building on this framework, we formulate a set of three hypotheses relating to the realization of product-specific scale and scope economies. The first two hypotheses posit that given low fixed costs and minimal entry barriers, both media-specific scale and scope economies are available and can be exploited by relatively small-size agencies. The third hypothesis suggests that large agencies may experience diseconomies of scope as a consequence of excessive diversification induced by two pervasive industry institutional phenomena: (1) “bundling” of agency services to match client demand for a mix of media advertising, and (2) “conflict policy,” which prohibits an agency from serving competing accounts and operates as a mobility constraint. Utilizing a multiproduct cost function, we estimate media-specific scale and scope economies for a cross section of 401 U.S. agencies in 1987. The results obtained support the set of three hypotheses outlined above. The paper concludes with a discussion of the implications of these findings for the restructuring currently underway in this industry.     

Vorschlag für ein prognose- und simulationsmodell des umwandlungsbereichs der energiewirtschaft in der Bundesrepublik Deutschland

Summary A Proposal for a Forecast and Simulation Model of the Energy Transformation Sector in the Federal Republic of Germany. — In this article an attempt is made to develop a forecast and simulation model of the energy transformation sector in the Federal Republic of Germany. First of all a method is shown by which energy balances can be transformed into energy input-output tables. Such tables enable a more detailed view of the energy sector in a flow diagram than those developed by the "Working Committee on Energy Balances." Furthermore, they lead to a critical evaluation of current balance methods, and reveal that certain assumptions — made in setting up these balances — do not hold up with respect to the transformation technology. In interpreting the theoretical implications of the input-output set-up, it is also possible to adequately consider the transformation losses and thus arrive at a definite solution to the simultaneous equation system.

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Résumé Une proposition d’un modèle de pronostic et de simulation du secteur de transformation de l’économie énergétique dans la République Fédérale d’Allemagne. — Dans cet article on essaie de développer un modèle de pronostic et de simulation pour le secteur de transformation de l’économie énergétique dans la RFA. D’abord l’auteur développe une méthode pour la transformation des bilans énergétiques dans des tableaux économiques-énergétiques d’input-output. D’une part ces tableaux permettent une compréhension plus profonde de la structure de l’économie énergétique au sens d’un tableau de flux que peut être donnée par les bilans énergétiques construites par la ?Arbeitsgemeinschaft Energiebilanzen?. D’autre part ils permettent quelques remarques critiques sur la méthode d’évaluation au bilan en découvrant que plusieurs des suppositions contenues dans le bilan énergétique ne sont pas compatibles avec la technologie de transformation. L’interprétation modèle-théorique du système économique-énergétique d’input-output conduit de plus à une considération apte des pertes de transformation et de cette manière à une solution claire du système d’équations simultanées.

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Resumen Proposición para un modelo de pronóstico y simulación del ámbito de transformación del sector energético en la República Federal de Alemania. — En este artículo se intenta desarrollar un modelo de pronóstico y simulación para el ámbito de transformación del sector energético en la República Federal de Alemania. Con este propósito se desarrolla primeramente un método que permite transformar los balances de energía en tablas de input-output energéticas. Estas tablas permiten, por un lado una visión más profunda de la estructura del sector energético en el sentido de un cuadro de secuencia que lo que permiten los balances de energia confeccionados por la ?Arbeitsgemeinschaft Energiebilanzen? (Comisión de Balances de Energia). Por el otro lado llevan a formular algunos comentarios críticos sobre los métodos para efectuar balances, donde se revela que algunos supuestos contenidos en el balance de energía no son compatibles con la tecnología de transformación. Por medio de la interpretación modelo-teórica del sistema de input-output energético se logra, además, contemplar pérdidas por transformación en forma adecuada y encontrar con ello una solución clara al sistema de ecuaciones simultáneas.

     

Minimum return guarantees,investment caps,and investment flexibility

We study the merits of capped retirement products with guarantee for investors who have the flexibility to dynamically adjust their investment strategy. All contracts under consideration are fairly priced such that the net profit of the provider is zero. Without the rider, an expected utility maximizing CRRA investor does not want an investment cap. Here, she commits herself to a strategy a priori. With the flexibility rider, the optimization problem changes and the optimal strategy is a response to an exogenously set price. A fair pricing then anticipates the optimal response of the investor. We show that the maximum expected utility of the investor can, for anticipated fairly priced products, be obtained for a finite cap. Thus, a capped product design can give a Pareto improvement to the otherwise uncapped contract version.     

Employment relations without collective bargaining and strikes: the unusual case of civil servants in Germany

The article deals with the widely neglected employment relations in the public sector of Germany with a special focus on civil servants. It is subdivided into two main parts. A shorter part elaborates on public employees and collective bargaining, a longer one on civil servants and their diverging forms of employment relations without the right to collective bargaining and strike. In order to better understand major changes that have taken place since the mid2000s, we chose a long-term perspective and examine traditional as well as present forms of interest representation. Limited degrees of decentralisation and their lasting diverging consequences are analysed in great detail.     

Remittances and the human capital of children: New evidence from Kyrgyzstan during revolution and financial crisis, 2005–2009

We analyze the effect of the receipt of remittances on the education and health of children in Kyrgyzstan during a volatile period of their recent history, 2005–2009. The country experienced revolution in 2005 and the global financial crisis beginning in 2008. Both events impact human capital investment, and the changes vary by region of the country. We use fixed effects estimation and fixed effects, instrumental variables estimation to isolate the effects of remittances and other events on human capital. We find that boys aged 14–18 in remittances’ receiving households are less likely to be enrolled in school than other children. We also find that girls in remittances’ receiving households are more likely to be malnourished (thin). Both effects are relatively small. Remittances do not improve the human capital of children left behind. However, we do find an overall positive improvement in school enrollment among young children between 2005 and 2009 but a negative trend in enrollment among older boys and girls. Nutrition improves over time. Regional differences are apparent in these trends in nutrition and education.     

Moral hazard and adverse selection in the originate-to-distribute model of bank credit

Bank credit has evolved from the traditional relationship banking model to an originate-to-distribute model. We show that the borrowers whose loans are sold in the secondary market underperform their peers by about 9% per year (risk-adjusted) over the three-year period following the initial sale of their loans. Therefore, either banks are originating and selling loans of lower quality borrowers based on unobservable private information (adverse selection), and/or loan sales lead to diminished bank monitoring that affects borrowers negatively (moral hazard). We propose regulatory restrictions on loan sales, increased disclosure, and a loan trading exchange/clearinghouse as mechanisms to alleviate these problems.     

Western popular music consumption by highly involved Chinese music fans

This paper explores the development of Western popular music consumption for highly involved Chinese consumers. This research is exploratory and uses semi-structured online interviews. The consumption of Western popular music in China is deeply embedded in the changing political and social context. In the late 1980s and early 1990s, an underground culture of ‘dakou’, cut tapes and CDs, developed, which was a decisive and formative influence for many of our respondents. Later this was supplemented by counterfeit tapes/CDs, and by Internet downloads, which also increased access to Western music. However, both recorded and live music are still censored in China. Our respondents agreed that the political restrictions on music have prevented China from developing a 'normal' music market, and created a market which is almost entirely based on illegal downloading. As the lifestyle choices of our respondents were deeply influenced by the consumption of Western music, many of them ultimately decided to leave China and live abroad.     

Rechtsnatur und Zuordnung der Alterungsrückstellungen in der PKV

Discussions about the inclusion of the previously privately insured into the statutory government health insurance abound. Specifically, questions regarding the transfer of specific rights under the private contract persist. In particular this article addresses the ageing reserve into which the insured contributed as part of their original policies. Since contractual claims are protected by fundamental property rights, it was first investigated whether the ageing reserve would allow the insured to claim a reimbursement. However, this disbursement cannot be supported as long as the ageing reserve is still being accrued and has not yet been dissolved since the monies paid into the reserve cannot be traced to their individual sources. The legal principles of trust (Treuhand) and reversion (Anwartschaftsrecht) are also not applicable to this situation as they are based on different factual premises. While the expectation of a constant premium throughout old age is not protected by German Basic Constitutional Law, the insured’s right to expect a continuance of the contract is protected; in addition, required services and remuneration in case of a claim are guaranteed by article 14.