new product introduction and incumbent response strategies their interrelationship and the role of multimarket contact in this article the author studies the determinants of both new product introduction and incumbent response strategies in a single integrated framework building on previous research in strategic

economics of a bottleneck abstract drawing on vickrey amer econ rev 59 251 261 1969 and subsequent literature this paper provides a thorough economic analysis of the simplest bottleneck model of road congestion with peak load demand in the morning rush hour a fixed number of identical individuals one per car must travel from home to work between which is a bottleneck of given capacity the costs of travel include queuing time and schedule delay time early or late for work the frequency distribution of departure times adjusts so that in equilibrium all individuals have the same travel costs the paper extends the previous literature by examining a coarse toll and solving for optimal capacities the application of congestion tolls can generate efficiency gains by altering the frequency distribution of departure times previous estimates of the efficiency gains from congestion tolling are likely to be substantially downward biased because they have ignored this effect

asset inequality matters an assessment of the world bank s approach to poverty reduction the fight against poverty has been adopted by the multilateral development banks as their principal objective almost three decades after robert mcnamara announced that the world bank s fundamental work was to improve the lives of the poor its new president james wolfensohn has reiterated that poverty reduction is the world bank s principal purpose similarly in 1994 the inter american development bank set social progress and social equity as its central objective the emphasis in the international institutions contrasts with disappointing results in the real world although life expectancy school enrollmuent and other indicators of social wellbeing have improved dramatically across the developing world and although the proportion of the poor has declined in the last few decades the absolute number of poor people in the world has actually increased today about 1 3 billion people in less developed countries still subsist on less than 1 per day world bank 1980 1990 1996 the case of latin america is dramatic while in the 1970 s the number of poor fell it nearly doubled in the 1980 s increasing from about 80 to almost 150 million and in the last few years the number of poor now 33 percent of the total population has failed to fall despite economic recovery birdsall and londofio 1997 the contrast between the multilateral banks goals and these disappointing results suggests the need for a critical reassessment of their approach to poverty reduction in this paper we describe the approach reflected in the work of world bank economists and based on new empirical work assess its relevance for latin america

human capital inequality and economic growth some new evidence this paper provides new measures of human capital inequality for a broad panel of countries taking attainment levels from barro and lee 2001 we compute gini coefficients and the distribution of education by quintiles for 108 countries over five year intervals from 1960 to 2000 using this new cross country data on human capital inequality two main conclusions are obtained first most countries in the world have tended to reduce the inequality in human capital distribution second human capital inequality measures provide more robust results than income inequality measures in the estimation of standard growth and investment equations

international migration the brain drain and poverty a cross country analysis the aim of the paper is threefold first it empirically investigates the effect of international migration on poverty in origin countries using data from a cross country analysis second it explores the specific part of the income distribution from which migrants are drawn by comparing the effect of international migration on different income quintiles of the population finally given that the selection of migrants depends not only on the income level of their households but also on the skill levels of movers the paper casts some light on the implications of the emigration of skilled workers on poverty this article shows that the stock of international migrants have a positive effect on the income of the poor while it does not have a significant impact on the income of the middle and top quintiles of the population in particular a 10 per cent increase in the per capita stock of migrants resident in oecd nations augments the income of the poor by 1 per cent on average and ceteris paribus finally the poverty reducing effect of migration holds even when the emigration process selects the best and the brightest

trade policy and income inequality new evidence abstract this paper uses recently available data to investigate the link between income inequality and trade protection it finds that among less developed countries more open economies experienced increased income inequality during the late 1980s trade policy has had no effect on income inequality in developed countries

a status based model of market competition this article explores the significance of status processes for generating and reproducing hierarchy among producers in a market it develops a conception of a market as a status order in which each

life is unfair in latin america but does it matter for growth summary i analyze the effect of inequality on economic growth in latin america where inequality is measured as the area of family farms as a percentage of the total area of agricultural holdings using data from 18 latin american countries during 1960 2004 i find that inequality has a nonlinear effect on economic growth overall for the countries included in this analysis the share of family farms has a positive significant effect on economic growth these findings are robust to controlling for several factors using a different indicator of inequality land gini and addressing for endogeneity

uniform versus peak load pricing of a bottleneck with elastic demand abstract this paper considers commuting to work across a bottleneck such as a bridge or tunnel with elastic demand with no toll there is wasteful queueing the optimal peak load toll eliminates queueing and leaves total traffic unchanged the second best uniform toll cannot eliminate queueing but reduces total traffic the second best uniform toll may be larger or smaller than the maximum value of the optimal peak load toll

alleviating rural poverty through agricultural growth the article examines the role of agricultural gdp growth in alleviating rural poverty in ldcs cross sectional regression analysis indicates that gdp growth by itself takes a very long time to reduce poverty significantly it suggests that decreases in land concentration could have a more immediate impact on reducing rural poverty the budgetary and other costs of implementing such changes are not however considered the preferred approach is a combination of equitable growth and redistributive measures

new product strategy and industry clockspeed we study how industry clockspeed internal firm factors such as product development production and inventory costs and competitive factors determine a firm s optimal new product introduction timing and product quality decisions we explicitly model market demand uncertainty a firm s internal cost structure and competition using an infinite horizon markov decision process based on a large scale numerical analysis we find that more frequent new product introductions are optimal under faster clockspeed conditions in addition we find that a firm s optimal product quality decision is governed by a firm s relative costs of introducing new products with incremental versus more substantial improvements we show that a time pacing product introduction strategy results in a production policy with a simple base stock form and performs well relative to the optimal policy our results thus provide analytical support for the managerial belief that industry clockspeed and time to market are closely related

the red queen in action the longitudinal effects of capital investments in the mobile telecommunications sector organizations undertake capital investments in technology to generate revenues or decrease costs and thereby enhance profitability however red queen type responses by competing organizations in the form of rapid imitation and escalating of technology investments erode the ability of the investing organizations to sustain gains in profitability productivity gains from these investments may persist but they may not translate into sustained profitability gains owing to declining prices brought about by a hypercompetitive environment the emergence and erosion of benefits attributable to capital investments is examined by decomposing profitability into productivity price recovery product mix and capacity utilization and by regressing each performance measure on past technology investments a polynomial distributed lag model is estimated with quarterly data for 30 firms in the mobile telecommunications services sector from 1996 to 2005 the results indicate that capital investments are positively associated with productivity of current and future periods and their association with profitability is only positive in the future after six quarters these results highlight a unique outcome of the red queen hypothesis simply by imitating learning and investing in technology due to competition is beneficial to all firms in the industry

growth and poverty evidence for developing countries in the 1980s abstract measures of consumption poverty for a sample of developing countries in the 1980s respond elastically to changes in mean consumption although there is a high variance in poverty outcomes at a given rate of growth there is no sign of systematic effects of growth on inequality

airport pricing congestion tolls lumpy investment and cost recovery abstract in this paper we investigate the relationship between congestion tolls and capacity expansion costs for congestion prone transportation infrastructures with lumpy investment with constant variable costs and social marginal cost pricing this relationship determines the cost recovery status of an infrastructure authority the theoretical model for optimal user charges and the timing of capacity expansion shows that the relative magnitudes of total congestion tolls and total capacity costs in an investment cycle depend on the time pattern of traffic growth a point overlooked in the literature a queuing model is used to conduct a numerical experiment to determine the cost recovery ratios under various time paths of traffic growth

optimal road capacity in the presence of unpriced congestion abstract this paper studies how the optimal capacity of a road is affected by a pricing constraint which keeps the toll fixed below its optimal value the answer is found to depend on the value of the price elasticity of travel demand at the second best optimum the pricing constraint lowers the optimal capacity if the price elasticity is sufficiently high but under reasonable assumptions the pricing constraint raises the optimal capacity if the price elasticity is less than the ratio of the consumer price of travel to the private congestion cost at the second best optimum this ratio cannot be less than one

slavery education and inequality abstract we investigate the effect of slavery on the current level of income inequality across us counties we find that a larger proportion of slaves over population in 1860 persistently increases inequality and in particular inequality across races we also show that a crucial channel of transmission from slavery to racial inequality is human capital accumulation i e current inequality is primarily influenced by slavery through the unequal educational attainment of blacks and whites finally we provide suggestive evidence that the underlying links run through the political exclusion of former slaves and the resulting negative influence on the local provision of education

economic inequality in the arab region the paper uses harmonized household survey micro data to assess the levels and determinants of economic inequality in 12 arab countries it focuses on the sources of rural urban as well as metropolitan nonmetropolitan inequalities and applies the unconditional quantile regression decomposition technique to analyze the welfare gaps across the entire distribution the analysis finds moderate inequality levels with the gini coefficient for the distribution of household real per capita total expenditures ranging between 30 7 in libya and 45 in mauritania differences in households endowments such as demographic composition human capital and community characteristics appear as the main sources of the urban rural welfare gap there is inequality between metropolitan and non metropolitan regions in many countries mainly because of differences in returns to households characteristics and particularly returns to human capital

conceptual developments in the economics of transportation an interpretive survey the objective in this paper is to survey the literature in transportation economics exploring two basic themes first the conceptual developments in the analysis of supply and demand which recognizes noteworthy aggregation biases in the empirical work on aggregate data and indicate that a correct analysis of the issues should take place at a highly disaggregated level second the use of these conceptual developments to evaluate efficiency aspects of transportation pricing investment and the impact of government regulation on resource allocation and distribution in the transportation sector it is important to acknowledge that the survey is based on research throughout the world but our institutional perspective and to some extent the topics that are covered is based largely on the u s experience author

ethnic diversity and poverty we examine the relationship between ethnic diversity and poverty for a cross sectional sample of developing countries we measure diversity using indices of ethnic and linguistic fractionalization and measure poverty using the multidimensional poverty index mpi multidimensional poverty headcount mph intensity of deprivation poverty gap and poverty headcount ratio we find that ethnic and linguistic fractionalization contributes to poverty levels specifically after controlling for endogeneity we find that a standard deviation increase in ethnic fractionalization is associated with a 0 32 0 44 and 0 53 standard deviation increase in the mpi mph and the intensity of deprivation respectively moreover a standard deviation increase in ethnic fractionalization is associated with between a 0 34 and 0 63 standard deviation increase in the population living below 1 90 and 3 10 the poverty gap at 1 90 and 3 10 a day and the headcount ratio at 1 90 and 3 10 a day similar results are also observed for linguistic fractionalization with standardized coefficients between 0 53 and 0 93 we find that our results are robust to alternative ways to measure poverty and ethnic diversity including ethnic polarization as well as alternative approaches to address endogeneity

a new data set measuring income inequality this article presents a new data set on inequality in the distribution of income the authors explain the criteria they applied in selecting data on gini coefficients and on individual quintile groups income shares comparison of the new data set with existing compilations reveals that the data assembled here represent an improvement in quality and a significant expansion in coverage although differences in the definition of the underlying data might still affect inter temporal and international comparability based on this new data set the authors do not find a systematic link between growth and changes in aggregate inequality they do find a strong positive relationship between growth and reduction of poverty

what are the distributional implications of halving poverty in south africa when growth alone is not enough the united nations millennium declaration commits to halving extreme poverty between 2000 and 2015 the south african government has set a goal of halving poverty by 2014 although the meaning of this goal has not yet been defined this article frames government s stated target of halving poverty by 2014 in terms of specific measures of the poverty gap and poverty headcount ratio using income and expenditure survey microdata with the poverty line as defined here approximately half the south african population falls below the poverty line despite this the aggregate poverty gap is surprisingly small at about 3 of gross domestic product projections of poverty in 2014 under various growth scenarios indicate that growth alone will be insufficient to halve poverty by then and that any worsening of distribution will put the target of halving poverty by 2014 far beyond reach however projections of the effects of a range of growth and distributional scenarios on poverty using a new method for simulating

technological regimes and the persistence of first mover advantages this article investigates first mover and early entrant advantages in terms of market share and its growth by analyzing a unique panel data set of korean manufacturing firms specifically this article examines the existence and persistence of first mover and early entrant advantages across different technological regimes we find that these advantages are influenced by characteristics of the firms as well as of the technological regimes under which they operate in general early entry into a market benefits a firm in terms of the size and growth rate of its market share early entrants including first movers have higher market shares except in regimes with high technological opportunity and low r d appropriability however first movers are disadvantaged in terms of market share growth except in regimes with low technological opportunities and high r d appropriability we also find that firm specific competences in r d and advertising help to maintain attenuate first mover and early entrant advantages disadvantages copyright 2011 the author 2011 published by oxford university press on behalf of associazione icc all rights reserved oxford university press

do international migration and remittances reduce poverty in developing countries summary few studies have examined the impact of international migration and remittances on poverty in the developing world this paper fills this lacuna by constructing and analyzing a new data set on international migration remittances inequality and poverty from 71 developing countries the results show that both international migration and remittances significantly reduce the level depth and severity of poverty in the developing world after instrumenting for the possible endogeneity of international migration and controlling for various factors results suggest that on average a 10 increase in the share of international migrants in a country s population will lead to a 2 1 decline in the share of people living on less than 1 00 per person per day after instrumenting for the possible endogeneity of international remittances a similar 10 increase in per capita official international remittances will lead to a 3 5 decline in the share of people living in poverty

are economic liberalization and equality compatible evidence from south asia summary global studies of liberalization and inequality have produced divergent findings arguably because of highly heterogeneous contexts across countries and regions this paper focusing on the south asian experience with more homogeneous contexts finds that liberalization efforts and inequality grew in the region during 1980 03 data support a mutually reinforcing positive relationship in the region suggesting that liberalization helps increase inequality which in turn serves as a precondition to liberalize because economically unequal countries tend to liberalize more intensely possibly hurting the poor a lesson for concerned policymakers is to introduce policies to incrementally advance economic openness

do or die competitive effects and red queen dynamics in the product survival race this study explores the reciprocal relationship between the nature and duration of competition and innovation outcomes we propose that the perpetually driven reciprocal sequence of competitive action and reaction known as the red queen in evolutionary biology is a cardinal force behind the success of innovations we test our hypotheses applying a comprehensive data set of all automobile manufacturers known to compete in the us automobile market at any time between 1946 and 2008 using data composed of 8203 model year pairs 1071 models from 148 different brands we find that recent competitive experiences of models rather than those in the distant past make them more viable competitors additionally superior reputation and market share are found to effectively shield models from the pernicious effects of red queen competition

growth inequality and poverty looking beyond averages the evidence is compelling that the poor in developing countries do typically share in the gains from rising aggregate affluence and in the losses from aggregate contraction but how much do poor people share in growth do they gain more in some settings than others do some gain while others lose does pro poor growth mean more or less aggregate growth recent theories and evidence suggest some answers but deeper microeconomic empirical work is needed on growth and distributed change only then will we have a firm basis for identifying the specific policies and programs needed to complement and possibly modify growth oriented policies

poverty reduction without economic growth explaining brazil s poverty dynamics 1985 2004 brazil s slow pace of poverty reduction over the last two decades reflects both low growth and a low growth elasticity of poverty reduction using gdp data disaggregated by state and sector for a twenty year period this paper finds considerable variation in the poverty reducing effectiveness of growth across sectors across space and over time growth in the services sector was substantially more poverty reducing than was growth in either agriculture or industry growth in industry had very different effects on poverty across different states and its impact varied with initial conditions related to human development and worker empowerment the determinants of poverty reduction changed around 1994 positive growth rates and a greater absolute elasticity with respect to agricultural growth contributed to faster poverty reduction but because there was so little of it economic growth played a relatively small role in accounting for brazil s poverty reduction between 1985 and 2004 the taming of hyperinflation in 1994 and substantial expansions in social security and social assistance transfers beginning in 1988 accounted for a larger share of the overall reduction in poverty

poverty inequality and growth in selected middle east and north africa countries 1980 2000 abstract this paper uses crosscountry data and country case studies to analyze trends in poverty inequality and economic growth in the middle east and north africa mena region compared to other regions the mena region has a low incidence of poverty and income inequality two factors account for this situation international migration remittances and public sector government employment since the early 1980s international migration to the persian gulf and europe has helped boost the incomes of the poor in the middle east at the same time many mena countries have used government employment as a means of keeping people employed and out of poverty regression analysis of crosscountry data shows that both of these factors have a statistically significant impact on reducing the level and depth of poverty in the mena region

inequality and growth uncovering the main conclusions from the empirics abstractthis paper is a critical survey of the empirical literature on the effects of inequality on economic growth we conclude that it is most likely that the disparities found in the results are due to differences in the type of countries and time periods included in the samples the variable used to measure inequality the structure of the data and the estimation techniques these findings suggest that the mechanisms that link inequality to growth are likely to operate differently in different circumstances an element that may offer important guidelines for both policy makers and researchers

macroeconomic performance and poverty in brazil abstract drawing on brazilian time series data this study finds an inelastic link between poverty and wages over the macroeconomic cycle that is devoid of the asymmetric effects that characterise the phenomenon s response to changes in the rate of unemployment deepening of structural reforms in the second half of the 1990s had no effect on the aforementioned relationships which also varied little by regional level of development finally the connection between poverty and long term income changes was more elastic suggesting an association between the economy s recent disappointing performance in alleviating poverty and its lacklustre growth record over the past two decades

development growth and policy reform in the middle east and north africa since 1950 prior to 1950 the countries of the middle east exhibited some of the lowest levels of socioeconomic development in the world for many of these countries not even approximate economic statistics are available for the first half of the twentieth century but the state of underdevelopment can be illustrated by looking at egypt the most modernized and populous country in the arab world at the time egyptian per capita income stagnated in the first half of the twentieth century the country lacked modern industries and relied largely on the cotton sector for export and government revenues but agricultural productivity had been on a steady decline since the end of the nineteenth century owen and pamuk 1998 prior to land reforms in 1952 three quarters of peasants in this agrarian country owned less than an acre or no land at all the neglect of human services allowed periodic epidemics and malnutrition to keep mortality rates high until the late 1940s education levels were well below other developing regions with adult illiteracy estimated at 85 percent in 1939 and only 23 percent of children ages 5 19 enrolled in school but in the 1960s and 1970s egypt and other countries of the middle east experienced robust economic growth based largely on high levels of investment in physical capital that facilitated substantial increases in per capita income it might seem obvious that the higher oil prices of the 1970s should have sustained the growth cycle in this oil exporting region but gdp growth per worker in the middle east decelerated in that decade and factor productivity growth actually turned negative in the 1980s and 1990s gdp growth per worker in the region was less than 1 percent per year and modest gains in human capital were largely offset by

a comparison of international income inequality an ordered probit model analysis in this study the ordered probit model with marginal effect was applied to examine the key elements that influence changes in the gini levels the empirical results indicated that export incentives and poverty have a positive impact on the gini levels moreover the marginal effect revealed that export incentives increase income inequality for countries with higher inequality and reduce inequality for those countries with a relatively even income distribution likewise the study found that the asian pacific economic cooperation apec and the eu countries move from inequality to equality more efficiently than countries in the latin american integration association laia

cointegration with structural changes between per capita product and income inequality in mexico the long run relationship between per capita product and income inequality in mexico is assessed for the period 1963 2010 the methodology consists of stochastic unit root techniques with structural changes the integration and cointegration tests suggest that it is not possible to understand this link if the possibility of structural changes is not taken into account causality running from per capita product to income inequality and a negative and significant overall effect are estimated however after the regime shifts mainly estimated to occur in the 1980s the connection is no longer meaningful this result seems to be linked to the slow growth of the mexican economy after these structural breaks affecting in turn the reductions in income inequality

the red queen in organizational creation and development we synthesize organization learning theory and organizational ecology to predict systematic patterns in the founding and growth of organizations over time our central argument is that competition triggers organizational learning which in turn intensifies competition that again triggers an adaptive response we model this self exciting dynamic sometimes referred to as the red queen in general evolutionary theory to explain organizational founding and growth rates among the thousands of retail banks that have operated in illinois at any time from 1900 1993 we find strong evidence that red queen evolution led some organizations to grow quickly and to place strong competitive pressure on rivals red queen evolution also helped establish barriers to entry however this same evolutionary process appears to make organizations more susceptible to competency traps ultimately slowing their growth rates and inviting new market entry organizations confronted by a widely varying distribution of competitors grow more slowly and are more likely to face new entrants overall the results suggest that processes of organizational creation and growth emerge from ecologies of learning organizations more generally we discuss the use of ecological theory and models to study the empirical consequences of organizational learning opyright 2002 oxford university press

competitive reactions to advertising and promotion attacks how do competitors react to each other s price promotion and advertising attacks what are the reasons for the observed reaction behavior we answer these questions by performing a large scale empirical study on the short run and long run reactions to promotion and advertising shocks in over 400 consumer product categories over a four year time span our results clearly show that the most predominant form of competitive response is passive in nature when a reaction does occur it is usually retaliatory in the same instrument i e promotion attacks are countered with promotions and advertising attacks are countered with advertising there are very few long run consequences of any type of reaction behavior by linking reaction behavior to both cross and own effectiveness we further demonstrate that passive behavior is often a sound strategy while firms that do opt to retaliate often use ineffective instruments resulting in spoiled arms accommodating behavior is observed in only a minority of cases and often results in a missed sales opportunity when promotional support is reduced the ultimate impact of most promotion and advertising campaigns depends primarily on the nature of consumer response not the vigilance of competitors

the economic effects of non optimal pricing and investment policies for substitutable transport facilities a dynamic simulation model of subbstitutable transportation facilities demonstrated the welfare revenue and capacity implications of various non optimal pricing and investment policies applications to a major airport and an urban transportation system an expressway and a subway showed that in both cases the welfare surface surrounding the optimal policy is relatively flat for a substantial range and that existing policies are also on this range for both transportation systems a policy of financial self sufficiency is on this range for the airport but not for the urban transportation system author

calculation and decomposition of income inequality in low and middle income countries a survey data analysis this article estimates income inequality in a sample of four low and middle income lmi countries namely albania nepal tajikistan and tanzania using the household survey data nepal living st

the impact of changes in human fertility on poverty household survey data for developing and transitional economies are used to estimate the effect of fertility crude birth rate net of infant deaths on private consumption poverty cross national regressions indicate that higher fertility increases poverty both by retarding economic growth and by skewing distribution against the poor our median country in 1980 had dollar a day poverty incidence of 18 9 per cent had it reduced its fertility by four per 1 000 throughout the 1980s the sample median fall it is estimated that incidence would have been reduced to 13 9 per cent the growth and distribution effects being roughly equally responsible for this reduction

differences in dynamic brand competition across markets an empirical analysis we investigate differences in the dynamics of marketing decisions across geographic markets empirically we begin with a linear quadratic game involving forward looking firms competing on prices and advertising based on the corresponding markov perfect equilibrium we propose estimable econometric equations for demand and marketing policy our model allows us to measure empirically the strategic response of competitors along with economic measures such as firm profitability we use a rich dataset that combines sales marketing mix factor cost and advertising cost data for eighteen geographic markets in the frozen entree category we find that larger markets tend to be less price sensitive and more profitable than smaller markets we also find evidence of positive carryover of own advertising on own demand in terms of consumer substitution patterns we find that the role of advertising in our data seems to be more category building complementary than share stealing competitive the complementary role is stronger in larger markets on the supply side we find that firms make smaller adjustments to own advertising as goodwill goes up consistent with cross advertising effects on demand firms make smaller larger adjustments to advertising in response to competitive goodwill in the less competitive larger in the more competitive smaller markets finally we find that consumer welfare decreases increases in larger smaller markets when firms move to a zero advertising regime

indivisibilities economies of scale and optimal subsidy policy for freeways in our 1976 paper herbert mohring thomas pinfold and i attempted to quantify optimal congestion tolls volume capacity ratios and subsidies for freeways in doing so we made the simplifying assumption of perfectly divisible traffic lanes of course freeway lanes are not divisible and with two to four lanes typically provided in each direction the size of the indivisibility is large this paper quantifies optimal freeway characteristics with indivisibilities taken into account we find that failure to account for indivisibilities can lead to

getting to global an evolutionary perspective of brand expansion in international markets the globalization of brands is an evolutionary process that is determined by environmental and firm level factors including a brand s position in the firm s global brand architecture a framework is developed incorporating aspects of environmental uncertainty mimetic behavior and experiential learning as they relate to the globalization of brands global brand architecture is introduced as an important strategic consideration of a brand s position and stage of internationalization the hypotheses are tested within the context of the global automotive industry employing an event history analysis with time varying covariates the results reveal complex effects with respect to the role of market attractiveness experiential learning and mimetic behavior in globalization patterns overall this study suggests that firms can accelerate the process of creating global brands if they enter the three major continents in the early stages of international expansion

a paradox of redistribution in international aid the determinants of poverty oriented development assistance summary donors differ in the amount of official development assistance dedicated to poverty reduction we investigate the causes of variation over time and donors by employing both a regression approach with aggregate data on bilateral aid and two short country studies on germany and the united kingdom we find that there is a trade off between the total amount of money given and the amount of money given to poor countries the trade off is similar to the paradox of redistribution of targeting vs redistribution in rich welfare states case study evidence illustrates how countries have managed this tradeoff

land inequality and economic growth a dynamic panel data approach the growing body of literature devoted to studying the impact of inequality on economic growth has centered its attention on the income distribution effect even though the theoretical relationships are more related to assets distribution while some recent studies have tried to overcome this limitation by introducing asset indicators they meet new constraints when dealing only with time invariant measurements for this explanatory variable this article provides a theoretical discussion and some novel empirical tests to better understand the relationships between assets distribution and economic growth we assembled a new panel database that includes observations for more than 30 countries over the last three decades the data include a time varying variable for changes in the land gini index over this period that enables us to overcome the limitations of previous studies a system general method of moments gmm estimator is used to generate truly unbiased and consistent estimates for the parameters of interest we explore some of the likely channels through which asset distribution and economic growth may be linked paying particular attention to the role of secure property rights and the relations between land ownership and education we find robust and significant negative signs for land inequality in the growth regressions indicating that changes in asset distribution are an important factor for economic development

does financial development contribute to poverty reduction the article examines the contribution of financial development to poverty reduction in developing countries building on earlier research which has established links between financial development and economic growth and between economic growth and poverty reduction the article tests for a causal process linking financial sector growth and poverty reduction the empirical results indicate that up to a threshold level of economic development financial sector growth contributes to poverty reduction through the growth enhancing effect the impact of financial development on poverty reduction will be affected however by any change in income inequality resulting from financial development

level of economic development and income inequality evidence from the postwar developed world using a recent high quality panel dataset on income distribution for 19 developed countries the postwar relation between the level of economic development and income inequality is estimated in terms of several kuznets type specifications contrary to what one might expect on the basis of kuznets s hypothesis inequality does not decline with an increase in income even at such high levels of development but shows an uninverted u pattern that is characterized by an initial decline and a subsequent increase in income inequality the estimates suggest that the position noted for the postwar united states is shared widely in the developed world

what can new survey data tell us about recent changes in distribution and poverty it has been claimed that in recent times the poor have lost ground both relatively and absolutely even when average levels of living have risen this article tests that claim using household surveys for 67 developing and transitional economies over 1981 94 it finds that changes in inequality and polarization were uncorrelated with changes in average living standards distribution improved as often as it worsened in growing economies and negative growth was often more detrimental to distribution than positive growth overall there was a small decrease in absolute poverty although with diverse experiences across regions and countries almost always poverty fell with growth in average living standards and rose with contraction

the kuznets process and the inequality development relationship abstract in his classic paper on economic growth and income inequality kuznets discussed the process of population shift from traditional to modern activities as the basis for a theory of distributional change during the course of development in this paper we present a formalization of the kuznets process conduct a general analysis of distributional change under this process and derive the functional forms of and conditions for a turning point in the inequality development relationship for six commonly used indices of inequality the functional form appropriate to each index is then estimated using cross section data on 60 developing and developed countries finally some extensions to the initial formalization of the kuznets process are considered

economic policy changes and wage differentials in latin america abstract this article presents estimates of the impact of changes in liberalization policies on wage differentials by schooling level using a new high quality data set for 18 latin american countries for 1977 98 the method controls for all fixed and time varying country characteristics some of which may affect the policies themselves the results indicate that liberalizing policy changes overall have had a short run disequalizing effect of expanding wage differentials although this effect tends to fade away over time this disequalizing effect is due to the strong impact of domestic financial market reform capital account liberalization and tax reform however privatization contributed to narrowing wage differentials and increasing trade openness had no significant effect on wage differentials technological progress rather than trade flows appears to be a channel through which policy changes are affecting inequality

making negotiated land reform work initial experience from colombia brazil and south africa abstract the paper describes background initial experience and future challenges associated with a new negotiated approach to land reform this approach has emerged as following the end of the cold war and broad macroeconomic adjustment many countries face a second generation of reforms to address deep rooted structural problems and provide the basis for sustainable poverty reduction and economic growth it reviews possible theoretical links through credit market or political channels between asset ownership and economic performance program characteristics in each country as well as lessons for implementation and implications for monitoring and impact assessment are discussed

creative self destruction among organizations an empirical study of technical innovation and organizational failure in the american automobile industry 1885 1981 a hotly debated question of organizational theory especially evolutionary theories of organization asks how inert are organizational structures answering the question requires analysis of not only organizational change but also of the consequences of change for organizational survival this study examines one such organizational change technical innovation and its effects on the failure rates of american automobile producers from 1885 to 1981 technical innovations are shown to generate primarily beneficial effects for the firms spawning them and primarily detrimental effects for competitor firms however analysis of certain organizational contexts large organizations in particular suggests that the risks of innovation may on occasion outweigh benefits the findings imply that some theories of strategic management need rethinking copyright 1996 by oxford university press

revenue recycling and the welfare effects of road pricing the authors explore the interaction between taxes on work related traffic congestion and preexisting distortionary taxes in the labor market a congestion tax raises the overall costs of commuting to work and discourages labor force participation at the margin when revenues are returned in lump sum transfers the resulting efficiency loss in the labor market can be larger that the pigouvian efficiency gains from internalizing the congestion externality by contrast if congestion tax revenues are used to reduce labor taxes the net impact on the labor supply is positive and the efficiency gain in the labor market can raise the overall welfare gains of the congestion tax by as much as 100 percent recycling congestion tax revenues in public transit subsidies produces a positive but smaller impact on the labor supply in short the authors results indicate that the presence of preexisting tax distortions and the form of revenue recycling can crucially affect the size and possibly even the sign of the welfare effect of road pricing schemes the efficiency gains from recycling congestion tax revenues in other tax reductions can amount to several times the pigouvian welfare gains from congestion reduction

the institutional foundations of inequality and growth abstract after a decade of research the effect of inequality on long run economic growth remains unresolved in part because researchers have treated omitted variable bias as an estimation problem rather than a deeper question of causality in this article we argue that the key omitted variable is the quality of economic institutions using both cross country and panel data specifications we find no direct effect of inequality on growth in the long run rather the protection of property rights simultaneously raises growth rates and reduces income inequality we interpret these findings as evidence that insecure property rights disproportionately disadvantage the poor

the welfare gains from pricing road congestion using automatic vehicle identification and on vehicle meters it is a widely accepted proposition that there is a general underpricing of auto travel in u s cities auto travel imposes a congestion externality with an efficient peak period level estimated at lo 23t per mile on urban freeways small 1121 2 3 but for most urban auto travel tolls consist almost entirely of the gasoline excise tax at a fuel economy of 15 miles per gallon the auto toll implied by the current high gas tax in the united states of 25e per gallon is only 1 7e per mile this is much too low for most peak period travel and even underprices some off peak travel the purpose of this study is to estimate the welfare gains which are possible under different regimes for imposing higher auto tolls in urban areas the three regimes studied are associated with a higher gas tax and systems called automatic vehicle identification and on vehicle metering the framework for the study is a model of a city whose shape is that of a wedge or pie slice of a circle the model s features include

economic growth and the quantity and distribution of education a survey the focus of this survey is to discuss different attempts at incorporating the distributional dimension of human capital into the theoretical and empirical growth framework we present a series of models which deviate from the direct link between the aggregate or average level of human capital and economic growth in that they introduce the distribution of education as a new element in explaining the relationship under investigation after surveying the theoretical literature we present recent empirical work on the relation between economic performance and the average level as well as the distribution of education respectively

can high inequality developing countries escape absolute poverty do the poor face the same prospects for escaping poverty in high inequality developing countries as in low inequality countries is it possible for inequality to be so great as to stifle prospects of reducing absolute poverty even when other initial conditions and policies are favorable to growth household survey data for developing countries suggest that initial distribution does affect how much the poor share in rising average incomes higher initial inequality tends to reduce growth s impact on absolute poverty by the same token higher inequality diminishes the adverse impact on the poor of general economic contraction combining this evidence with that from recent investigations of inequality s effect on growth the author finds that if inequality is high enough countries that would have very good growth prospects at low levels of inequality may see little or no overall growth and little progress in reducing poverty or even a worsening on both counts the data the author uses suggest that such cases do occur the precision with which key parameters have been estimated makes it difficult to say with confidence how common such cases are but they appear to be in the minority what appear to be the best available estimates suggest that about one fifth of the spells between surveys he analyzed were cases in which poverty was rising yet positive growth in the mean and hence falling poverty is predicted at zero inequality inequality can be high enough to result in rising poverty despite good underlying growth prospects

changing asset endowments and smallholder participation in higher value markets evidence from certified coffee producers in nicaragua this paper examines the capacities of smallholders in nicaragua to exploit new linkages to certified coffee markets following the coffee crisis data on livelihood assets were collected from 292 households which were clustered to test how differences in outcomes asset building reflect variations in initial asset endowments the results suggest that most households built particular elements of their asset base and increased their resilience to future shocks however households struggled to make effective use of the gains for intensifying their livelihoods of the least endowed households few made investments in the scale or productivity of coffee and most continued to depend heavily on subsistence production and seasonal off farm income for survival in conclusion improved market access alone even under relatively favorable market conditions and with considerable external support will have uncertain impacts on rural poverty if the underlying constraints on household assets and investments are not addressed concurrently

outstanding female economists in the analysis and practice of development economics abstract this article examines the contributions of five eminent economists all women to the analysis and practice of development economics irma adelman frances stewart and nancy birdsall are leading advocates of alternative development strategies that focus on poverty alleviation and investment in human capital anne krueger and alice amsden stand at the forefront of two opposing camps in a lively and long lasting debate on the appropriate role of government in trade and industrialization we use the storied careers of these economists as a vehicle to convey the big picture of how development economics has evolved and which topics have proved durable