The Returns to Education: Microeconomics

In this paper we focus on education as a private decision to invest in "human capital" and the estimation of the rate of return to that private investment. While the literature is replete with studies that estimate the rate of return using regression methods where the estimated return is obtained as the coefficient on a years of education variable in a log wage equation that contains controls for work experience and other individual characteristics, the issue is surrounded with difficulties. We outline the theoretical arguments underpinning the empirical developments and show that the evidence on private returns to the individual is compelling. Despite some of these issues surrounding the estimation of the return to schooling, our evidence, based on estimates from a variety of datasets and specifications, is that there is an unambiguously positive effect on the earnings of an individual from participation in education. Moreover, the size of the effect seems large relative to the returns on other investments.     

Strengthening executive decision making

Although decisions determine corporate fates, executives don't always know how to make the best choices. The author examines today's dissatisfaction with corporate decision making, reviews how it can deteriorate as the pace of change increases, and offers five comprehensive strategies for improving the decision making process. © 1995 by John Wiley & Sons, Inc.     

Interviewers,Interviewer Continuity,and Panel Survey Nonresponse

It is widely known that in practice, different interviewers have different response rates, though there has been no systematic examination of whether this is because of differences among interviewers or differences among those areas allocated to the interviewers (area effects), or both. Furthermore, the conventional wisdom in survey research suggests that it is advisable to have the same interviewers return to the same respondents in order to maintain good response rates in longitudinal surveys, though once again there has been very little documented experimental research to support this. This paper makes use of the interpenetrated sample design experiment in Wave 2 of the British Household Panel Study (BHPS) (i) to explore the effects of interviewers' background characteristics and years of experience on response rates, (ii) to identify and estimate the differential effects of interviewers on response rates and compare the magnitudes of area and interviewer effects, and (iii) to investigate the impact of interviewer continuity. The analysis is facilitated by the use of cross-classified multilevel modelling. The paper also looks at the issue of interviewer continuity qualitatively, through the impressions of the interviewers themselves.     

On a monotonicity property of the Klein-Rubin true cost-of-living index

It is shown that the Klein-Rubin true cost-of-living index associated with the Stone-Geary Linear Expenditure System has a highly restrictive feature. When used to measure the impact of relative price changes on different income (expenditure) groups, the index numbers will always be monotonic in income.     

What is a multinational corporation? Classifying the degree of firm-level multinationality

The degree of firm-level multinationality is a key dimension that spans all theoretical frameworks, levels of empirical analysis and domains of investigation in international business research. There is, however, no agreed approach to defining or measuring firm-level multinationality. This is reflected in inconsistent approaches to sample selection and empirical testing, and it has curtailed the advancement of the discipline. We propose that instead of searching for the elusive, all-encompassing definition of an MNC, international business scholars should instead agree on a classification system for the degree of firm-level multinationality. We illustrate the advantages of this approach by constructing a simple classification system that takes into account the firm's breadth and depth of multinational engagements. We illustrate our matrix of firm multinationality by classifying a novel sample of over 1000 firms from seven countries, and we demonstrate how it can guide theory development and empirical testing. We also provide examples of potential future research directions.     

The Role of Ideas in Understanding Industrial Relations Policy Change in Liberal Market Economies

This paper analyzes the uneven processes underpinning industrial relations policy liberalization in New Zealand, Australia, the UK, and Ireland. Drawing upon 140 elite interviews and building upon ideational comparative political theories, the paper highlights the role of ideas in the policy change process. It identifies how particular ideas can be used to construct policy problems, how these ideas can gain legitimacy through battles with competing ideas, and how policy legacies can influence whether ideas take root. The findings from the comparative case analysis expose a critical difference between “positive legacies” and “negative legacies” to account for different liberalization trajectories.     

A structural portfolio balance model of the Sterling-Dollar exchange rate

Zusammenfassung Ein Strukturmodell des verm?genstheoretischen Ansatzes zur Erkl?rung des Pfund-Dollar-Wechselkurses. — In diesem Aufsatz wird eine Variante des verm?genstheoretischen Ansatzes zur Bestimmung des Wechselkurses in seiner Strukturform auf den Pfund-Dollar-Kurs des Zeitraums 1973–1982 angewandt. Dabei wird die Methodologie von Brainard und Tobin benutzt, wodurch sichergestellt wird, da\ die Koeffizienten bestimmten Restriktionen genügen. Gesch?tzt wird das Modell sowohl mit der Kleinst-Quadrate-Methode als auch mit dem Theil-Goldberger-Verfahren der gemischten Sch?tzungen. Mehrere Aktiva-Schocks werden simuliert und die Reaktionen der Zinss?tze und der Wechselkurse aufgezeigt.

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Résumé Un modèle structurel de ?portfolio balance? du taux de change Sterling-Dollar.- Dans cet article les auteurs appliquent la structure d’une version de l’approche de ?portfolio balance? à la détermination du taux de change sterling-dollar sur la période 1973–1982. Dans le modèle, la méthodologie de Brainard et Tobin est utilisée qui garantit que les restrictions nécessaires d’addition sont satisfaites. Les méthodes des moindres carrés ordinaires aussi bien que les procédures d’estimation mixte de Theil-Goldberger sont appliquées pour estimer le modèle. Les auteurs simulent un nombre des chocs d’actif et illustrent la réponse des taux d’intérêt et du taux de change.

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Resumen Un modelo ?portfolio balance? estructural del tipo de cambio entre la libra esterlina y el dólar. - En este trabajo se presenta una versión del modelo de ?portfolio balance? para determinar el tipo de cambio, que es implementado estructuralmente para el tipo libra esterlina - dólar en el período 1973–1982. En la implementación de este modelo se utiliza la metodología de Brainard y Tobin, que garantiza la consistencia de las restricciones. Con el fin de estimar el modelo se aplica tanto el método de cuadrados mínimos como también el método mixto de Theil y Goldberger. Se llevan a cabo varias simulaciones a base de shocks de activos para ilustrar la reacción de las tasas de interés y del tipo de cambio.

     

Pricing dynamics in US fresh produce channels: new empirical evidence

Despite many valuable contributions, prior research has not completely explained retail pricing behavior. This study employs scanner data for 36 fresh produce items analyzing the relationship between costs of goods sold and retail prices to provide further insight into retail pricing behavior. Implications include: (1) where ‘natural’ variation in produce prices do not already exist from the supplier, retailers appear to introduce the variation themselves, independent from shipping point price; and (2) to the extent that supplier-retailer contracts for fresh produce develop, the resulting stabilizing influence on costs may have the preserve effect of increasing retail price variability to consumers.     

Counting carbon: historic emissions from fossil fuels,long-run measures of sustainable development and carbon debt

This article examines how to account for the welfare effects of carbon dioxide emissions, using the historical experiences of Britain and the USA from the onset of the industrial revolution to the present. While a single country might isolate itself from the detrimental effects of global warming in the short run, in the long all countries are unable to free ride. Thus, we support the use of a single global price for carbon dioxide emissions. The calculated price should decrease as we move back in time to take into account that carbon dioxide is a stock pollutant, and that one unit added to the present large stock is likely to cause more damage than a unit emitted under the lower concentration levels in the past. We incorporate the annual costs of British and US carbon emissions into genuine savings, and calculate the accumulated costs of their carbon dioxide emissions. Enlarging the scope and calculating the cumulative cost of carbon dioxide from the four largest emitters gives new insights into the question of who is responsible for climate change.     

Stimulating high–tech venture creation

This paper explores whether policy makers can successfully encourage high–tech venture creation. We outline some of the policy interventions that have been used to stimulate new venture creation. We then present case evidence of how a new high–tech industrial district emerged in Dublin, focussing on the role of various policy interventions. We conclude by arguing that a range of appropriately timed policy interventions can be pivotal in the development of internationally competitive high–tech new ventures. However the case suggests that it was a combination of sector level and direct firm level interventions that stimulated and facilitated the emergence of a cohort of high–tech new ventures.