Cooperation with a multiproduct corporation in a strategic managerial delegation

We consider an industry composed of a multiproduct corporation that adopts corporate social responsibility (CSR) as a strategic managerial delegation and examine the profit-incentive to form a cooperative group. We find that competition is an equilibrium for any degree of substitutability and yields the highest CSR, which is increasing in the degree of substitutability. We also show that full cooperation is an equilibrium for lower substitutability but induces no CSR, whereas partial cooperation with one uniplant firm is an equilibrium for higher substitutability but yields lower CSR than that under competition. Therefore, cooperation might reduce strategic CSR activities, whereas competition will encourage higher CSR but yield lower industry profits.     

Perception evaluation kit: a case study with materials and learning styles

International Journal of Technology and Design Education - Materials are elements that configure our built environment and are key components in design and engineering education. This research aims...     

Unilateral effects of mergers with general linear demand

We derive the formula for the unilateral price effects of mergers of two products with linear demand in the general asymmetric situation. The formula uses the same information required to calculate upward pricing pressure in the 2010 Horizontal Merger Guidelines.     

Measuring the cost of liquidity in agricultural futures markets: Conventional and Bayesian approaches

Estimating the cost of liquidity in agricultural futures markets is challenging because bid‐ask spreads are usually not observed. Based on an ability to reflect simulated data from Roll's spread model, we assess the effectiveness of conventional and Bayesian bid‐ask spread estimators under different market conditions. Conventional serial covariance and absolute price change spread estimators appear to be biased. Hasbrouck's Bayesian estimator generates small costs of liquidity whose values depend on the correlation and noise in the data. The absolute value Bayesian estimator is precise and works well under conditions of high levels of noise and correlation usually found in agricultural futures markets. Using data from live cattle (LC) and lean hog (LH) contracts, we find similar patterns of performance that produce economically meaningful cost of liquidity differences.     

Within-group heterogeneity and group dynamics: analyzing exit of microcredit groups in Angola

The effect of within-group heterogeneity on the survival of social groups is theoretically ambiguous. A greater diversity of ideas, experience, and networks can have a positive effect on members’ benefits from group membership, but diversity also creates a potential for conflict. This paper analyzes the relation between heterogeneity and exit of microcredit groups, using data from Angola. The results suggest that the form of group heterogeneity matters. Fragmentation in terms of social identities, or more specifically religious-linguistic fractionalization, is associated with a greater probability of group exit. Within-group economic inequality, however, is associated with a decrease in the probability of exit, but at a diminishing rate.     

How Effective are WTO Disciplines on Domestic Support and Market Access for Agriculture?

A new round of trade negotiations through the World Trade Organization (WTO) was launched in 2001. One of the major aims of the Doha Development Round is to reduce agricultural protection and impose greater discipline on domestic agricultural subsidies, particularly those that are the most trade distorting. In this article, we examine whether the proposed WTO modalities for agriculture will actually achieve this aim in Norway, which ranks among the top providers of government assistance for agriculture. Norway has a complex system of farm subsidies buttressed by substantial import protection. The extent to which its agricultural support policies will have to change in response to new WTO disciplines provides an important indication of how successful these are likely to be. We find that Norway will probably be able to sustain its current agricultural activity and production levels while staying within the new WTO rules. Following recent practice in some other WTO members, Norway will be able to reduce its notified support without making real changes in some of its programmes. However, there will have to be a shift from market price support, which is paid for by consumers through higher food prices, to budgetary support paid by taxpayers. This could generate increased domestic pressure for policy reform.     

Banking Sector Performance in Latin America: Market Power versus Efficiency

Since the mid‐1990s the banking sector in the Latin American emerging markets has experienced profound changes due to financial liberalization, a significant increase in foreign investments, and greater merger activities often occurring following financial crises. The wave of consolidation and the rapid increase in market concentration that took place in most countries has generated concerns about the rise in banks' market power and its potential effects on consumers. This paper advances the existing literature by testing the market power (Structure–Conduct–Performance and Relative Market Power) and efficient structure (X‐ and scale efficiency) hypotheses for a sample of over 2500 bank observations in nine Latin American countries over 1997–2005. We use the Data Envelopment Analysis technique to obtain reliable efficiency measures. We produce evidence supporting the efficient structure hypotheses. The findings are particularly robust for the largest banking markets in the region, namely Brazil, Argentina, and Chile. Finally, capital ratios and bank size seem to be among the most important factors in explaining higher than normal profits for Latin American banks.     

The Collapse of the ‘New EMS’: An Interpretation

Existing theoretical models cannot explain the following features of the EMS and its crisis in 1992: its progressive hardening from 1987 onwards; the fact that credibility was shared the progressive deterioration of credibility after the first Danish referendum without changes in the economic fundamentals. This paper argues that the reason lies in the fact that the literature has not accounted for the changes in the perceived prospects of EMU. We show that an adjustable peg regime that incorporates these prospects can explain the three features listed above.     

Testing for output convergence: a re-examination

This paper investigates output convergence for the G7 countriesusing panel time-series techniques. We consider both the nullhypotheses of no convergence and convergence. It is shown thatinferences on output convergence depend on which one of thetwo null hypotheses is considered. Further, the no convergenceresults reported in previous studies using the time-series definitionmay be attributed to the low power of the test procedures beingused. Our results also highlight some potential problems oninterpreting results from some typical panel unit root and stationaritytests.