Determinacy with nominal assets and outside money

Summary. We build a finite horizon model with inside and outside money, in which interest rates, price levels and commodity allocations are determinate, even though asset markets are incomplete and asset deliveries are purely nominal.Received: 2 July 2003, Revised: 1 December 2004 JEL Classification Numbers: D50, E40, E50, E58.Correspondence to: J. Geanakoplos     

Adjustment of inputs and measurement of technical efficiency: A dynamic panel data analysis of the Egyptian manufacturing sectors

The purpose of this article is to construct a dynamic stochastic production frontier incorporating the sluggish adjustment of inputs, to measure the speed of adjustment of output, and to compare the technical efficiency estimates from this dynamic model to those from a static model. By assuming instantaneous adjustment of all inputs, a static model may underestimate technical efficiency of a production unit in the short-run. However, in this article I show that under the assumption of similar adjustment speed for all inputs, a linear partial adjustment scheme for output characterizes the dynamic production frontier. The dynamic frontier with time-invariant technical efficiency is estimated using the system GMM (generalized method of moments) estimator. Applying the model and estimation method on a panel data set spanning 9?years of data on private manufacturing establishments in Egypt, I find that (1) the speed of adjustment of output is significantly lower than unity, (2) the static model underestimates technical efficiency by 4.5 percentage points on average, and (3) the ranking of production units based on their technical efficiency measures changes when the lagged adjustment process of inputs is taken into account.     

Impatience implication of weakly Paretian orders: Existence and genericity

We study order theoretic and topological implications for impatience of weakly Paretian, representable orders on infinite utility streams. As a departure from the traditional literature, we do not make any continuity assumptions in proving the existence of impatient points. Impatience is robust in the sense that there are uncountably many impatient points. A general statement about genericity of impatience cannot be made for representable, weakly Paretian orders. This is shown by means of an example. If we assume a stronger sensitivity condition, then genericity obtains.     

On equitable social welfare functions satisfying the Weak Pareto Axiom: A complete characterization

The present paper examines the problem of aggregating infinite utility streams with a social welfare function that respects the Anonymity and Weak Pareto Axioms. The paper provides a complete characterization of domains (of the one period utilities) on which such an aggregation is possible. A social welfare function satisfying the Anonymity and Weak Pareto Axioms exists on precisely those domains that do not contain any set of the order type of the set of positive and negative integers. The criterion is applied to decide on possibility and impossibility results for a variety of domains. It is also used to provide an alternative formulation of the characterization result in terms of the accumulation points of the domain.     

On Corporate Virtue

This paper considers the question of virtues appropriate to a corporate actor’s moral character. A model of corporate appetites is developed by analogy with animal appetites; and the pursuit of initially virtuous corporate tendencies to an extreme degree is shown to be morally perilous. The author thus refutes a previous argument which suggested that (1) corporate virtues, unlike human virtues, need not be located on an Aristotelian mean between opposite undesirable extremes because (2) corporations do not have appetites; and (3) corporate virtues must serve the end of sustainable profit. If these disanalogies between corporate and human virtue no longer hold, then the stage is set for us to formulate a more adequate model of good corporate character that would encompass other-regarding virtues.     

Bankruptcy and optimality in a closed trading mass economy modelled as a non-cooperative game

In this paper we establish the existence of (a) an optimal bankruptcy rule which enables us to describe the Walrasian trading economy as a game with trade in fiat money; and (b) non- cooperative equilibrium points of this game which (in terms of prices and the final allocation yielded) include the competitive equilibrium points, and the accompanying money rate of interest (induced by borrowing at a central bank), when the bankruptcy rule is different from optimal.