is protectionism on the rise assessing national trade policies during the crisis of 2008 to understand the role of trade policies in the crisis of 2008 this paper constructs the overall trade restrictiveness indices for a wide range of countries using their tariff schedules in 2008 and 2009 the index summarizes the trade policy stance of a country taking into account the share of each good in trade as well as its corresponding import demand elasticity results show that there is no widespread increase in protectionism via tariff policies since the global financial crisis has unfolded while many countries have adjusted tariffs upward on selected products only a handful of countries such as malawi russia argentina turkey and china focus on products that have significant impacts on trade flows the united states and the european union by contrast rely mainly on anti dumping duties to shield domestic industries overall while the rise in tariffs and anti dumping duties in these countries may have jointly caused global trade to drop by as much as us 43 billion during the crisis period it explains less than 2 percent of the collapse in world trade

the determinants of dismissals quits and layoffs a multinomial logit approach in efficiency wage models workers productivity depends positively on the wage giving firms an incentive to pay wages above their market clearing level two models in this literature are the shirking model of shapiro and stiglitz 12 and bowles 1 and the turnover cost model of stiglitz 13 schlicht 11 and salop 10 in the shirking model a higher wage and a higher unemployment rate raise the cost of losing one s job thereby discouraging workers from shirking and increasing their effort in the turnover cost model a higher wage reduces quits and thus lowers the firm s cost of hiring and training new workers given the role of separations in efficiency wage models it is important to understand the determinants of separations this study uses data on individual workers to examine the determinants of dismissals quits and layoffs within the first six months of a hire paying particular attention to dismissals because of the prominence of the shirking model in the efficiency wage literature the purposes of this study are to test whether higher unemployment lowers dismissals as predicted by the shirking model and to examine the effect of firm variables related to the costs of monitoring and shirking on the probability of a dismissal in addition this study provides insight into the effects of firm characteristics and worker characteristics on dismissals quits and layoffs

an empirical analysis of wage dispersion and efficiency wages the main purpose of this study is to examine inter industry wage differentials in sweden after controlling for individual and job characteristics the results indicate that these differentials are substantial the ranking of the differentials was stable over time while the dispersion of wage premiums fell by 50 per cent during the period 1968 81 a period of strong efforts to reduce wage dispersion in sweden the relation between industry wage premiums and a number of industry characteristics is also examined along with new evidence which is in line with the shirking model hypothesis on the relation between wages and worker control

temporary foreign workers and firms theory and canadian evidence abstract temporary foreign worker tfw programs have grown considerably in size when uncapped we develop a simple efficiency wage model to explain this phenomenon and examine the empirical evidence for it we also use the model to evaluate the implications of tfw programs for domestic workers in our framework firms that have been unable to find domestic workers may hire tfws at the wage previously advertised to domestic workers due to the lower outside option for tfws than domestic workers tfws will exert more effort for the same wage firms would thus prefer to hire otherwise identical tfws rather than domestic workers our model identifies an unintended consequence of a tfw program since the repercussions of a failed domestic job search are less severe if a tfw may be hired instead firms have an incentive to lower their wage offers made to domestic workers using canadian data we find that relative to domestic workers tfws work longer hours have lower rates of absenteeism and are less likely to be laid off consistent with higher effort in our model moreover for tfws from home countries with a relatively high outside option effort is lower than for tfws from other countries resume travailleurs etrangers temporaires et entreprises theorie et exemple canadien en l absence de plafonnement les programmes de travailleurs etrangers temporaires ptet se sont considerablement developpes afin d expliquer ce phenomene et d en examiner les preuves empiriques nous avons developpe un modele simple de salaire d efficience nous avons egalement utilise ce modele pour evaluer l incidence des ptet sur les travailleurs domestiques dans notre cadre d etude les entreprises peinant a trouver une main d uvre locale peuvent embaucher des travailleurs etrangers temporaires au salaire prealablement propose aux travailleurs domestiques compte tenu d options exterieures plus faibles les travailleurs etrangers temporaires deploieront davantage d efforts pour le meme salaire les entreprises prefereront donc embaucher des travailleurs etrangers par ailleurs identiques plutot que des travailleurs domestiques notre modele identifie une consequence inattendue aux ptet etant donne que les consequences d une recherche d employes domestiques infructueuse sont attenuees par l embauche de travailleurs etrangers temporaires les entreprises sont incitees a diminuer les offres salariales proposees aux travailleurs locaux en exploitant les donnees propres au canada nous avons decouvert que les travailleurs etrangers temporaires travaillaient plus d heures avaient des taux d absenteisme inferieurs et etaient moins susceptibles de se faire congedier que les travailleurs domestiques conformement au concept d effort accru developpe dans notre modele en outre pour les travailleurs etrangers temporaires originaires de pays a options exterieures relativement elevees l effort sera moindre que pour ceux provenant d autres pays

union power cost of job loss and workers effort the authors hypothesize that the effectiveness of external threats in raising workers effort is mediated by among other labor market conditions the presence or absence of a powerful union in particular they argue that because powerful unions reduce the potency of the external threat of job loss by making it more difficult for employers to dismiss workers the pace of work is less responsive to such a threat in strongly unionized plants than in weakly unionized plants the results of an analysis of data from the 1990 workplace industrial relations survey in britain support this hypothesis the analysis also yields evidence that effort is increased where workers are rewarded individually according to results and where there are various communication channels between workers and management

unemployment and effort at work we measure the sensitivity of work effort to local labour market conditions using self reported non work at the workplace in the american time use survey atus 2003 12 non work at work is quantitatively significant and varies positively with local unemployment but in opposite directions at the extensive and intensive margins the fraction of workers reporting positive values declines with unemployment while time spent in non work conditional on any such time rises with unemployment the results speak to issues of labour hoarding efficiency wages and the cyclicality of labour productivity we also demonstrate a relationship between the incidence of non work and unemployment benefits in state data linked to the atus there are also pronounced occupational differences in the incidence and intensity of non work

off the cliff and back credit conditions and international trade during the global financial crisis abstract we study the collapse of international trade flows during the global financial crisis using detailed data on monthly us imports we show that credit conditions were an important channel through which the crisis affected trade volumes by exploiting the variation in the cost of capital across countries and over time as well as the variation in financial vulnerability across sectors countries with higher interbank rates and thus tighter credit markets exported less to the us during the peak of the crisis this effect was especially pronounced in sectors that require extensive external financing have limited access to trade credit or have few collateralizable assets exports of financially vulnerable industries were thus more sensitive to the cost of external capital than exports of less vulnerable industries and this sensitivity rose during the financial crisis the quantitative implications of our estimates for trade volumes highlight the large real effects of financial crises and the potential gains from policy intervention

is the efficiency wage efficient the social norm and organizational corruption the effectiveness of efficiency wage incentives is often jeopardized by perverse organizational corruption we model organizational corruption as a phenomenon of social interaction and relate the substantial psychological role characterizing the social norm to the corruption problem we find that if the status quo bribery rate within the firm is high social norms can no longer serve as a sufficient sanction against a corrupt supervisor pandemic organizational corruption tends to generate a critical mass effect the snowball effect which intensifies the corruption effect this intensified effect due to the snowballing character of social norms may more than offset the usual incentive effect of wages resulting in more widespread shirking in the firm jel classification d82 j41

could tariffs be pro cyclical abstract conventional wisdom says that tariffs are counter cyclical we analyze the relationship between business cycles and applied mfn tariffs using a disaggregated product level panel dataset covering 72 countries between 2000 and 2011 strikingly and counter to conventional wisdom we find that tariffs are pro cyclical further investigation reveals that this pro cyclicality is driven by the tariff setting behavior of developing countries tariffs are acyclical in developed countries we present evidence that pro cyclical market power drives the pro cyclicality of tariffs in developing countries providing further evidence of the importance of terms of trade motivations in explaining trade policy

the system worked global economic governance during the great recession prior to 2008 numerous international relations scholars had predicted a looming crisis in global economic governance policy analysts have only reinforced this perception since the financial crisis declaring that we live in a g zero world this article takes a closer look at the global response to the financial crisis and reveals a more optimistic picture despite initial shocks that were more severe than the 1929 financial crisis global economic governance structures responded quickly and robustly whether one measures results by outcomes outputs or process formal and informal governance structures displayed surprising resiliency multilateral economic institutions performed well in crisis situations to reinforce open economic policies especially in contrast to the 1930s while there are areas where governance has either faltered or failed on the whole the system has worked misperceptions about global economic governance persist because the great recession has disproportionately affected the core economies analysts have conflated national with global governance and the efficacy of past periods of global economic governance has been badly overestimated why the system has worked better than expected remains an open question but we can tentatively conclude that both the power of the united states and the resilience of neoliberal economic ideas were underestimated

peasant farmer behavior and cereal technologies stochastic programming analysis in niger peasant farmers in sahelian west africa adjust to rainfall uncertainties in the agricultural season by making decisions sequentially as a function of the evolving rainfall patterns understanding such flexibilities in farmer decision making is central to technology introduction this paper determines how sequential decision making under weather uncertainty affects the adoption and farm level effects of cereal technologies in niger the study also draws policy implications for a price floor to arrest the substantial fall in cereal prices in good rainfall years when farmers have more grains to sell the methodology used is discrete stochastic programming the paper shows that the ability of peasant farmers to adapt cropping and resource management strategies to the rainfall patterns is the basis for their survival in this high risk environment model results show that by a carrying a portfolio mix of varieties of varying maturities and b making sequential decisions based upon rainfall expectations farmers can adapt to the production uncertainties breeding programmes should therefore be diversified to develop not only early maturing cultivars but also improved intermediate and long season varieties

economists capitalists and the making of globalization north american free trade in comparative historical perspective why did globalization happen current explanations point to a variety of conditions under which states have made the free market policy changes driving international economic integration since the 1980s such accounts disagree however about the key actors involved this article provides a reconciliation showing how two different combinations of actors and two different political economic pathways have led to globalization in recent decades in developed countries mobilization by business has been central elsewhere technocrats both constrained and empowered by international finance have pursued globalization more independently of business in both contexts economists technical authority has helped legitimate liberalization despite the limited diffusion of their ideas the article validates and elaborates this model using a comparative historical study of how the united states canada and mexico proposed negotiated and ratified agreements for free trade in north america

a multisector model of efficiency wages the pattern of effort and wages is derived in a multisector efficiency wage model firms choose effort endogenously easily monitored or low turnover jobs have high effort and may have low wages in equilibrium empirical wage differentials from a measure of supervision are smaller than observed industry differentials that have been attributed to efficiency wage models and are closer to those predicted by the model workers can search for and avail of on the job offers if sectors grow at different rates or the unemployment rate changes the pattern of wage differentials is unaffected

global supply chains and trade policy responses to the 2008 crisis the collapse in trade and the contraction of output that occurred during 2008 9 was comparable to and in many countries more severe than the great depression of the 1930s however it did not give rise to the rampant protectionism that followed the great crash the idea that the rise in the fragmentation of production across global value chains vertical specialization may be a deterrent against protectionism is under appreciated in the literature institutions also played a role in limiting the extent of protectionist responses world trade organization discipline raises the cost of using trade policies for member countries and has proved to be a stable foundation for the open multilateral trading system that has been built over the past 50 years using tradeand protection data for seven large emerging market countries that have a history of active use of trade policy the influence of these and other factors on trade policy responses to the 2008 crisis are empirically examined an instrumental variables strategy is used to identify their impact participation in global value chains is found to be a powerful economic factor determining trade policy responses

is there a trade off between supervision and wages an empirical test of efficiency wage theory abstract the logic of efficiency wage theory suggests a trade off between wages and supervision this paper reports evidence that high levels of supervision are indeed associated with lower wage levels the empirical investigation centers on the effect that safety supervision by host employers has on the wages of contract maintenance workers in the petrochemical industry this narrow focus is important special institutional features of the contract employment relationship in petrochemicals make it possible to ameliorate econometric problems that may have influenced earlier studies

a new theory of corporatism and wage setting abstract the standard view on corporatist institutions for wage setting in many european economies is based of the insider outsider model corporatism is associated with lack of wage flexibility this paper discusses a new approach starting from the importance of nominal contracts the rationale for these contracts is to avoid future bargaining adjusting these contracts ex post to aggregate shocks would raise their efficiency however avoiding the bargaining required for this adjustment was the main reason for negotiating these contracts in the first place this is the fundamental contradiction under corporatism outside institutions can play this role these institutions provide therefore a type of flexibility not available in decentralized economies empirical evidence supports the basic ideas of this model

cultural proximity a source of trade flow resilience while the significant influence of cultural proximity on bilateral trade flows has been extensively documented in the literature its possible role in times of crisis has not yet been raised relying on a panel estimation of a gravity model incorporating cultural proximity parameters we evidence the existence of a significant surge in the impact of the different components of cultural proximity during economic recession the trade resilience among countries sharing a cultural bond is not a pure composition effect as it also appears within product categories to understand this unexpected effect we discuss different mechanisms that emphasise the potential mitigating influence of cultural proximity on some determinants of the trade collapse namely the uncertainty shock the increased moral hazard and the emergence of ethnocentric preferences

can wage increases pay for themselves tests with a production function efficiency wage theories predict that companies that pay high wages will have higher productivity from high work effort low turnover and other efficiency enhancing effects this paper uses the pims line of business data set to test whether high wage businesses are more productive relative wages were measured by managers assessments of their relative compensation holding worker quality constant a positive relation was found between changes in relative wages and changes in total factor productivity the elasticity of output with respect to wages was of the magnitude predicted by efficiency wage theories also consistent with efficiency wage theories the relationship between changes in wages and changes in productivity was weaker at businesses with high unionization results from two additional data sets imply that high wages are not merely measuring high human capital copyright 1992 by royal economic society

hegemonic stability theory and 19th century tariff levels in europe although the theory of hegemonic stability has attracted an impressive array of adherents current formulations leave many conceptual issues unresolved existing formulations also fail to draw from the theory any implications concerning the process by which a hegemonic state creates and maintains a regime as an example great britain is generally agreed to have been hegemonic in the nineteenth century but britain s behavior was generally inconsistent with that implied by a theory of hegemonic stability i advance an alternative set of explanations for changes in international tariff levels based on the notion of a political business cycle

protectionism during the crisis tit for tat or chicken games abstract we explore the extent to which the adoption of protectionist measures during the recent financial crisis led to retaliation by trading partners we find no evidence of retaliation on the contrary there is strong evidence of chicken games being played

contracting with repeated moral hazard and private evaluations a repeated moral hazard setting in which the principal privately observes the agent s output is studied the optimal contract for a finite horizon is characterized and shown to require burning of resources these are only burnt after the worst possible realization sequence and the amount is independent of both the length of the horizon and the discount factor for the infinite horizon it is shown that there is no loss from restricting the analysis to contracts in which the agent receives a constant efficiency wage and no feedback until he is fired furthermore optimal contracts cannot be replicated by short term contracts a family of fixed interval review contracts is characterized longer review intervals are preferable but harder to implement comparative statics on the review length are carried out finally these contracts are shown approximate first best if players are very patient jel d82 d86

self organized criticality and economic fluctuations economists have long been interested in explaining the observed instability of economic aggregates though several reasons for variation in the pace of production are easily given such as exogenous variation in tastes or in production possibilities it is hard to see why there should be large variations in those factors that are synchronized across the entire economy instead it seems more likely to suppose that variations in demand or in production costs in different parts of the economy should be largely independent and hence that a law of large numbers would imply that significant variations in aggregate activity relative to the typical size of aggregate activity are not likely to occur an alternative approach proposes that economies possess intrinsically unstable dynamics which even in the absence of external shocks would result in persistent deterministic fluctuations this type of model implies however that aggregate fluctuations should involve motion on a low dimensional attractor while analysis of economic time series has not revealed structure of this kind another alternative proposes that the economy possesses multiple equilibria and that it can therefore switch between equilibria for arbitrary reasons this possibility suffers however from the difficulty that one must explain how people succeed in coordinating their expectations about the times at which a shift should occur here we explore another type of explanation which relies on an entirely different mechanism our proposal is that the effects of many small independent shocks to different sectors of the economy need not cancel out in the aggregate due to the presence of significantly nonlinear strongly localized interactions between different parts of the economy the type of macroscopic instability that can result has been studied by condensed matter physicists under the name of self organized criticality per bak and kan chen 1991 physicists have noted in several contexts the possibility of a critical state in which independent microscopic fluctuations can propagate so as to give rise to instability on a macroscopic scale this is a state in which chain reactions initiated by local disturbances neither damp out over a short distance the subcritical case nor propagate explosively so that the system cannot remain in that state the supercritical case as in the controlled nuclear fission that allows a reactor to generate power without exploding often this has seemed to depend upon parameters being carefully tuned to exactly their critical values in the case of a reactor an elaborate control mechanism is required to keep it near criticality more recently it has been argued that some systems may spontaneously evolve toward a critical state and return to it even if perturbed by an external shock the prototypical example of such selforganized criticality is a sandpile when the slope of the pile is nowhere too steep dropping on additional grains of sand at randomly chosen sites has no macroscopic effects as at most small numbers of grains will shift position in each case however randomly dropping on additional sand will eventually result in the slope of the pile increasing to a critical slope at which point large avalanches can occur in response to the dropping of a single additional grain of sand a sandpile with a slope that is initially greater than the critical slope also evolves toward it in this case through an immediate department of economics university of chicago 1126 east 59th st chicago il 60637 we thank per bak buz brock boyan jovanovic and paul krugman for discussions and the santa fe institute and the nsf for research support 1scheinkman 1990 surveys empirical work on this

the free trade epidemic of the 1860s and other outbreaks of economic discrimination why was there an abrupt increase in economic openness in europe in the 1860s this increase may have been the result of a contagion process in which the cobden chevalier treaty between britain and france threatened to displace third party exports to fra nce with british exports as a result most european states signed similar treaties with france which had further ripple effects this article outlines a formal model of this process based on the assumption that an agreement between two states incre ases the desirability of similar treaties to third parties propositions regarding the rate and pattern of spread of treaties are derived from this model this article then discusses the insights these propositions may offer into the rise and fall of the most favored nation network of treaties between 1860 and 1929 at a theoretical level the model aims to link the microlevel processes underlying state preferences to system level phenomena at a substantive level this analysis offers insight into the current explosion of regionalism

import protection business cycles and exchange rates evidence from the great recession this research estimates the impact of macroeconomic fluctuations on import protection policies over 1988 q1 2010 q4 for five industrialized economies the united states european union australia canada and south korea there is evidence of a strong countercyclical trade policy response in the pre great recession period of 1988 q1 2008 q3 during which increases in domestic unemployment rates real appreciations in bilateral exchange rates and declines in the gdp growth rates of bilateral trading partners led to substantial increases in new temporary trade barriers it then applies this pre great recession empirical model to realized macroeconomic data from 2008 q4 2010 q4 and find it predicts a surge of new import protection during the great recession e g for the us and eu the model predicts new trade barriers would cover an additional 15 percentage points of nonoil imports well above the baseline level of 2 3 percent of import coverage immediately preceding the crisis finally the research examines why the realized trade policy response differed from model predictions while exchange rate movements played an important role in limiting new import protection during the great recession there is also evidence of one particularly important change in trade policy responsiveness i e in this period governments refrained from imposing new temporary trade barriers against foreign trading partners experiencing their own weak or negative economic growth

trade policy flexibilities and turkey tariffs antidumping safeguards and wto dispute settlement trade policy commitments to lower import tariffs and to maintain tariffs at low levels entail short and long run political economic costs and benefits empirical work examining the relationship between such commitments and the exercise of trade policy flexibilities is still relatively nascent especially for emerging economies this paper provides a rich empirically based assessment of ways that turkey exercised trade policy flexibilities during the global economic crisis of 2008 11 first and despite multilateral and customs union commitments that might limit changes to applied tariffs turkey made changes to both its applied most favored nation and preferential tariffs that cumulatively affect nearly 9 percent of manufacturing imports and 10 percent of import product lines second turkey s cumulative application of temporary trade barrier ttb policies antidumping safeguards and countervailing duties are estimated to impact by 2011 an additional 4 percent of imports and 6 percent of product lines other surprising results on turkey s use of flexibilities include extending the duration of previously imposed antidumping and safeguards beyond expected removal dates removing one ttb policy over a set of products and immediately reapplying a different ttb policy covering lengthy upstream and downstream segments of important industries and deepening discriminatory preference margins already inherent in existing preferential trade agreements

deferred compensation vs efficiency wages an experimental test of effort provision and self selection abstract we compare the ability of two common compensation structures efficiency wages ew and deferred compensation dc at inducing effort from workers we test predictions on effort provision and elicit preferences between the two wage structures the theoretical predictions on effort are generally well supported although we find over provision of effort with ew in consequence although the theoretical prediction that dc is more cost effective is supported the difference is small we also find a marked preference for ew that cannot be explained by risk aversion the two effects combine to largely dissipate any advantage that dc may have in inducing effort

risk analysis of new maize technology in zaire a portfolio approach risk associated with the adoption of new maize technology and the impact of mandatory cotton production on traditional farmers in the kasai oriental region of zaire are evaluated within a portfolio context using a quadratic programming model seasonal net returns for farm plans including four levels of maize technology in combination with staple food crops are evaluated with and without mandatory cotton production the results indicate that cropping systems that include new maize technology are risk efficient relative to local maize varieties while mandatory cotton production is not risk efficient at the prevalent price and yield levels in the farming system

efficiency wages and employment rents the employer size wage effect in the job market for lawyers the efficiency wage hypothesis offers an explanation for employment rents according to this hypothesis firms pay wages above the opportunity cost of labor to elicit productivity or quality enhancing behaviors from employees firms pursue this strategy when alternative incentive schemes are unavailable or too costly thus firms will not pay premium wages when employees post sufficiently large performance bonds this article examines employment rents in a setting where employees post sizable performance bonds large law firms contrary to the efficiency wage hypothesis we find that associates in these large firms post substantial performance bonds while also receiving substantial ex ante rents

robustness of the mean variance model with truncated probability distributions the known sufficient conditions for the mean variance framework to produce expected utility results are violated in the presence of truncated probability distributions a theoretical simulation is conducted to examine the ability of the linear mean variance model to approximate expected utility results when the income distribution is truncated by the use of commodity option contracts the mean variance model is shown to produce solutions that are close approximations to the expected utility model results under the assumptions of constant absolute risk aversion and normally distributed prices however some inconsistency was found between the comparative static results of the two models

shirking and choking under incentive based pressure a behavioral economic theory of performance production abstract significant empirical evidence exists within psychology and economics that greater incentives under pressure can lead to lower performance outcomes however standard economic theory does not account for this possibility efficiency wage models for example conclude a positive relationship between wage incentives and productivity while efficiency wage models are shown to describe productivity behavior in numerous settings said models do not describe labor markets featuring counterproductive performance pressure we put forth a theoretical model of performance production in which performance incentives induce productive effects and counterproductive effects the model treats explicit monitoring and distraction as distinct counterproductive processes within a cohesive theory of performance production in settings featuring performance pressure we find that higher levels of performance contingent compensation may decrease not only labor output i e likelihood of task success but also labor input i e effort if counterproductive processes decrease the marginal effectiveness of effort sufficiently the latter finding challenges a common view that performance decrements under pressure occur despite greater effort levels

interests power and multilateralism multilateralism characterizes to varying degrees patterns of interaction among states and the formal organizations they construct the utility of multilateral norms or organizations varies with the type of cooperation problem states confront thus the functional logic of international cooperation leads to hypotheses about the conditions under which the institution of multilateralism may be a feasible and efficient solution as in coordination problems and those under which it will not as in collaboration problems within these constraints powerful states choose institutions that will serve their interests with multilateral arrangements becoming more attractive as the future is valued more highly multilateral institutions should be stable in circumstances of changing distributions of power relative to more hierarchical institutions the vulnerability of patterns of international cooperation to various exogenous changes depends on the type of strategic interaction underlying state behavior

work environment and individual background explaining regional shirking differentials in a large italian firm the prevalence of shirking within a large italian bank appears to be characterized by significant regional differentials in particular absenteeism and misconduct episodes are substantially more prevalent in the south we consider a number of potential explanations for this fact different individual backgrounds group interaction effects sorting of workers across regions differences in local attributes different hiring policies and discrimination against southern workers our analysis suggests that individual backgrounds group interaction effects and sorting effects contribute to explaining the north south shirking differential none of the other explanations appears to be of first order importance i introduction whether individual behavior is determined by group interactions or by individual background is undoubtedly a fundamental question for the social sciences this question presented itself forcefully when we stumbled onto the following piece of evidence there appear to be significant regional differentials in the prevalence of shirking among the employees of a large italian bank in particular absenteeism and misconduct episodes are considerably more frequent in the southern branches of the bank in this paper we examine several potential explanations for this fact first individual preferences for shirking versus working may differ according to one s region of hirth we will refer to this hj othesis as one of different individual hackgrounds the second possibility is one of locational sorting low shirking types may tend to migrate to the north high shirking types may tend to migrate to the south or hoth third the northern and southern

international law and domestic institutions reconciling north american unfair trade laws while scholars have written much about the role played by international institutions in cooperative behavior among nations they have not examined the domestic political motives that may lie behind nations decisions to join such organizations two level games analysis provides a framework for studying domestic politics not as a constraint upon nations that enter into international agreements but as a catalyst for nations to enter into agreements the dispute settlement procedures of the north american free trade agreement and its predecessor the canada u s free trade agreement offer an empirical illustration of this point

two moment decision models and expected utility maximization two moment decision models are consistent with expected utility maximization only if the choice set or the agent s preferences are restricted this paper identifies a restriction which is sufficient to ensure this consistency and confirms that it holds in many economic models the implications for economic analysis are then derived two different approaches to representing an agent s preferences over strategies yielding random payoffs are in wide use under the mean standard deviation ms approach the agent is assumed to rank the alternatives according to the value of some function defined over the first two moments of the random payoff while the expected utility eu criterion assumes that the expected value of some utility function defined over payoffs is used instead the fact that there are these two competing approaches has generated a considerable literature some authors are concerned with the advantages and disadvantages of each while others deal with conditions under which the potentially different approaches would yield the same results or at least approximately so space does not

system maker and privilege taker u s power and the international political economy there is striking consistency in the international economic behavior of the united states across the bipolar and unipolar eras the united states has been simultaneously a system maker and privilege taker and its ability to play that dual role has required the willing collaboration of foreign partners u s influence over those partners however has changed in important ways during the cold war the united states dominated international economic adjustment struggles its ability to prevail in those struggles after the cold war has been significantly compromised the united states notwithstanding its preponderant power no longer enjoys the same type of security leverage it once possessed and the very success of the u s centered world economy has opened a greater range of international and domestic economic options for america s supporters in the unipolar era the united states may continue to act its own way but it can no longer count on getting its own way

are wages habit forming evidence from micro data although utility functions play a central role in economics the axiom that utility depends only on the absolute levels of its arguments is rarely tested this paper uses panel data on 2000 british employees who remain with the same employer and who are not promoted from one wave to the next it is shown that one important measure of well being overall job satisfaction is strongly positively correlated with the change in the worker s pay between waves but is unrelated to the current level of pay empirical tests suggest that a reference dependent satisfaction function where individual well being depends on current pay relative to past pay is more consistent with these regression results than are productivity or agency explanations of increasing wage profiles some evidence is presented of greater job satisfaction effects of pay rises for lower paid less well educated and younger workers these results provide some micro evidence consistent with the theory widespread in social science of habituation individuals may become used to any given level of consumption or income as such they tie in with the finding that a country s well being as measured by the average happiness of its citizens is only weakly correlated with its per capita gnp

contractual incompleteness unemployment and labor market segmentation this article provides evidence that involuntary unemployment and the segmentation of labour markets into firms offering good and bad jobs may both arise as a consequence of contractual incompleteness we provide a simple model that illustrates how unemployment and market segmentation may jointly emerge as part of a market equilibrium in environments where work effort is not third party verifiable using experimental labour markets that differ only in the verifiability of effort we demonstrate empirically that contractual incompleteness can cause unemployment and segmentation our data are also consistent with the key channels through which the model explains the emergence of both phenomena copyright 2014 oxford university press

the provision of incentives in firms i ncentives are the essence of economics despite many wide ranging claims about their supposed importance there has been little empirical assessment of incentive provision for workers the purpose of this paper is to critically overview existing work on the provision of incentives since the interests of workers and their employers are not always aligned a large theoretical literature has emphasized how firms design compensation contracts to induce employees to operate in the firm s interest this literature has reached into many areas of compensation and has pointed to a multitude of different mechanisms that can be used to induce workers to act in the interests of their employers these include piece rates options discretionary bonuses promotions profit sharing efficiency wages deferred compensation and so on my objective here is to evaluate this literature in the light of a growing empirical literature on compensation where possible i will address the literature from two perspectives first an underlying assumption of this literature is that individuals respond to contracts that reward performance accordingly i consider whether agents behave in this way and whether these responses are always in the firm s interest second i address whether firms write contracts with these responses in mind in other words do contracts look like the predictions of the theory incentives are provided to workers

are wages too low empirical implications of efficiency wage models firms may pay efficiency wages to enhance productivity the conventional presumption is that efficiency wages are inefficiently high because they lead to unemployment that is also inefficiently high government policies that lower wages raise output using a simple and general efficiency wage model this paper finds a necessary and sufficient condition for the opposite conclusion if the condition holds wages are inefficiently low leading to productivity that is also inefficiently low it is the high wage policies that raise output even if they also lower employment published empirical results support the condition no evidence is found for the conventional presumption

views among economists professional consensus or point counterpoint to what degree do economists disagree about key economic questions we provide evidence by using the responses to a series of questions posed to a distinguished panel of economists put together by the chicago school of business based on our analysis we find a broad consensus on these many different economic issues particularly when the past economic literature on the question is large any differences are unrelated to observable characteristics of the panel members other than men being slightly more likely to express an opinion these differences are idiosyncratic with no support for liberal versus conservative camps

carrots and sticks pay supervision and turnover the efficiency wage model ewm has been advanced as an explanation for large and persistent wage differentials the shirking version of the ewm assumes a trade off between self supervision and external supervision the turnover version assumes turnover is costly to the firm variation across firms in the cost of monitoring shirking or turnover then is hypothesized to account for wage variations across firms for homogeneous workers using a new sample of firm data this paper presents empirical evidence of the trade off of wage premiums for supervisory intensity and turnover little evidence is found to support either version of the ewm

trade wars and trade talks when governments meet in the international arena their actions reflect the political situations at home previous studies of trade relations have focused on governments that are immune from political pressures and that act as benevolent servants of the public interest here we introduce domestic politics into the analysis of international economic relations we study the interactions between national leaders who are concerned both with providing a high standard of living to the general electorate and collecting campaign contributions from special interest groups our analysis sheds light on the determinants of the structure of protection in non cooperative and cooperative policy equilibria

managing the evolution of multilateralism author s downs george w rocke david barsoom peter n abstract in the past five years a relatively extensive literature has emerged that explores the demand for multilateral cooperation that is those factors that motivate states to develop or resist developing formal institutions that operate to increase interstate economic military or environmental cooperation 1 these factors include the transaction costs associated with ad hoc and multiple bilateral arrangements increased interstate trade the diffusion of liberal trade theory information about the costs of environmental degradation and trends in elite ideology to date however our understanding of the supply side of multilateralism the standards that are set for admission the order and speed with which candidate states are admitted and the impact of expansion on cooperation and future evolution has been relatively undeveloped 2 partly as a result theorists have had little to say about how multilateral institutions are likely to evolve or what the policy consequences of their expansion will be 3 supply side issues are important because multilateral organizations usually do not spring forth full blown they grow instead of forming an inclusive agreement that is one that covers nearly all of the states that its designers eventually hope to include many multilateral organizations start out with substantially smaller memberships and generally expand over time we argue that among the many possible explanations for the choice of this design strategy there is a rational choice argument

monitoring motivation and management the determinants of opportunistic behavior in a field experiment economic models of incentives in employment relationships are based on a specific theory of motivation employees are rational cheaters who anticipate the consequences of their actions and shirk when the marginal benefits exceed costs we investigate the rational cheater model by observing how experimentally induced variation in monitoring of telephone call center employees influences opportunism a significant fraction of employees behave as the rational cheater model predicts a substantial proportion of employees however do not respond to manipulations in the monitoring rate this heterogeneity is related to variation in employee assessments of their general treatment by the employer jel d2 j2 l2 l8 m12

tariff retaliation from a strategic viewpoint one of the most perplexing questions in international trade concerns the rationale for the existence of widespread barriers to trade in the current world economy 1 the numerous explanations that have been offered for the existence of tariffs are generally based on one of the following four arguments a the existence of market imperfections monopolies externalities etc invalidates the free trade theorem and thus free trade is not desirable or perhaps not obtainable b sluggish adjustment of the world economy to free trade implies that the existing tariffs are a temporary phase c non economic phenomena such as nationalism induce political or institutional tariff arrangements or d protectionist motives to improve the welfare of a country or a group of individuals in that country induce all countries to simultaneously impose tariffs while all of these factors can be important in the explanation of the existence of tariffs the purpose of this paper is to develop an extended analysis of the protectionist view the protectionist view is based on the optimal tariff theorem which states under very restrictive assumptions that a country can improve its welfare by imposing a tariff 5 12 a serious difficulty with this explanation is that the optimal tariff theorem assumes that no retaliation occurs as scitovsky 12 points out a country that could benefit from charging a tariff has monopoly power in trade surely a country sophisticated enough to exercise monopoly power in trade would expect its rivals to respond when tariffs are erected hence scitovsky argues that if protection is the monopolistic behavior of a collectivity two countries raising tariffs against each other are bilateral monopolists and we know that bilateral monopoly results in the two parties coming to some working agreement whose terms depend on their bargaining skill and are analytically indeterminate scitovsky concluded that a tariff war would result in an indeterminate solution with both countries worse off johnson 6 formalized scitovsky s agrument by allowing each country to adopt a cournot type assumption regarding its rival s reaction to a change in its own tariff thus

taking stock of antidumping safeguards and countervailing duties 1990 2009 antidumping safeguards countervailing duties 1990 2009 this article examines the evolving cross country use of antidumping safeguard and countervailing duty policies temporary trade barriers ttbs over the period 1990 2009 i construct two new measures of imported products subject to the combined use of these ttbs before applying these measures to new data drawn from the world bank s temporary trade barriers database i then establish a number of facts regarding trends in historical use to benchmark against policy activity during the global economic crisis of 2008 09 the 2008 09 economic shock mostly accentuates patterns and trends already visible in the precrisis data e g while the major users of such policies overall combined to increase the product lines subject to ttbs by 25 per cent during the crisis this was driven almost entirely by developing economies which increased their product coverage by 40 per cent perhaps surprisingly recession affected high income economies increased their stock of product coverage by only 5 per cent during the crisis a muted policy response consistent with earlier trends in which major developed economies like the united states and eu reduced the stock of imported products they subject to ttbs to 2007 levels that were only 50 per cent as high as their within period peak furthermore a previously unidentified feature of the data is that a much larger share of china s exported products to other developing economies is subject to foreign imposed antidumping than its exports to developed economies the evidence confirms this feature is shared by a number of other major developing economy exporters deepening concern that these discriminatory trade barriers are increasingly a south south phenomenon finally i also clarify emerging trends in countervailing duty anti subsidy use across countries

regime dynamics the rise and fall of international regimes the dynamics of international regimes are treated as social institutions how and why do regimes arise from the interactions of individual actors over time three developmental sequences are identified and the resultant regimes are described as spontaneous orders negotiated orders and imposed orders how do regimes change once they have become established in specific social settings three major types of pressure for regime change arise from internal contradictions shifts in underlying power structures and exogenous forces the next task in studying the dynamics of international regimes is to seek a more sophisticated understanding of the factors determining the incidence of these developmental sequences and pressures for change

why some jobs command wage premiums a test of career tournament and internal labor market hypotheses the wage premiums associated with jobs in a large organization were identified through comparing their pay to the prevailing wages in the relevant outside labor markets we then examined the characteristics of those jobs to investigate why some commanded larger premiums than others jobs at the tops of promotion ladders jobs requiring many organization specific skills and to a lesser extent jobs with access to influence commanded greater wage premiums wages above market rates appear important in supporting the internal labor market mechanisms associated with these jobs findings may clarify the factors compensation managers should consider when positioning wage rates examination of these issues is a potentially important bridge between the study of internal labor markets in organizational research and the study of wages in economics

3 3 theory of customs unions abstract four recent models those of berglas corden meade and riezman which have extended the theory of customs union to 3 3 dimensions are reviewed the reasons for both apparent and real differences among the welfare propositions from these models are explained some new extensions are derived the main conclusions are that the family of 3 3 models introduce several effects which cannot be present in 3 2 models and that the distinctions among the models are due mostly to diverse assumptions concerning the trilateral pattern of trade which are not readily apparent

the mercantilist index of trade policy we introduce an index of trade policy restrictiveness defined as the uniform tariff that maintains the same trade volume as a given tariff quota structure our index overcomes the problems of the trade weighted average tariff it avoids substitution bias correctly accounts for general equilibrium transfers and takes import volume instead of welfare as benchmark empirical applications to international cross section and time series comparisons of trade policy confirm our theoretical results trade weighted average tariffs generally underestimate the true height of tariffs as measured by the trade volume equivalent index this in turn always underestimates the welfare equivalent index

introduction epistemic communities and international policy coordination the growing technical uncertainties and complexities of problems of global concern have made international policy coordination not only increasingly necessary but also increasingly difficult if decision makers are unfamiliar with the technical aspects of a specific problem how do they define state interests and develop viable solutions what factors shape their behavior under conditions of uncertainty what are the origins of international institutions and how can we best study the processes through which international policy coordination and order emerge while a variety of analytic approaches have been used to address the problems of international cooperation the approaches have yielded only fragmentary insights at its core the study of policy coordination among states involves arguments about determinism versus free will and about the ways in which the international system is maintained and transformed among the overlapping topics of debate are whether national behavior is determined or broadly conditioned by system level factors unit level factors or some complex interplay between the two whether state policymakers can identify national interests and behave independently of pressures from the social groups they nominally represent and whether states respond consistently to opportunities to create defend or expand their own wealth and power to enhance collective material benefits or to promote nonmaterial values a related question of

the direct and relative effects of preferential market access abstract the proliferation of preferential trade agreements has resulted in a complex system of preferences in which market access conditions are often discriminatory in this paper we investigate how market access conditions have evolved between 2000 and 2009 and how this has affected international trade our results show that the proliferation of preferential access has increased bilateral trade not only due to lower tariffs but also because preferential access often resulted in higher preferential margins vis a vis foreign competitors the results also indicate that the evolution of the system of preferences has been disadvantageous for countries that did not actively engage in forming new trade agreements

trade diversion as firm adjustment to trade policy evidence from eu anti dumping duties on vietnamese footwear this paper evaluates the impact of the 2006 european union anti dumping ad action on vietnamese footwear in three markets imports to the eu footwear producers in vietnam and the trade diversionary adjustment of vietnamese firms in the us market we find that the ad action reduced vietnamese imports to the eu by as much as 65 per cent given that the eu makes up almost two thirds of vietnam s footwear exports and footwear is among the top four export industries for vietnam this reduction is economically significant consistent with predictions of our model we find evidence of trade diversion by vietnamese producers from the eu to the us market our difference in difference estimates of the ad actions on the value of vietnamese footwear imports to the united states ranged from 69 to 71 per cent over the period 2004 07 and 69 to 72 per cent in terms of quantity these results highlight the spillover effects of trade policy in third markets when firms adjust to trade barriers our results are robust to triple difference specifications where we adjust for trend differences and a series of placebo specifications

the size of trading blocs market power and world welfare effects abstract we construct an n country n commodity trade model to analyze the implications of bloc size for nash equilibrium tariffs and welfare the relationship between the absolute size of symmetric trading blocs and their market power is ambiguous and we illustrate how this relationship varies with model parameters in contrast sufficiently large increases in the relative size of a bloc enhance its relative market power and cause the welfare of its country members to rise above the free trade level we establish the existence of an optimal bloc size and study the dependence of optimal size on the parameters of the model

hidden protectionism evidence from non tariff barriers to trade in the united states abstract can the enforcement of product standards be protectionism in disguise this paper estimates the costs of non compliance with u s product standards using a new database on u s import refusals from 2002 to 2014 we find that import refusals decrease exports to the united states this trade reducing effect is driven by developing countries and by refusals without any product sample analysis in particular during the subprime crisis and its aftermath we also provide evidence that given product standards were enforced more strictly during the crisis while the quality of imported products did not deteriorate these results are consistent with the existence of counter cyclical hidden protectionism due to non tariff barriers to trade in the united states

does the political power of nonfinancial stakeholders affect firm values evidence from labor unions whereas corporate political connections are known to enhance equity values we demonstrate that union political activity can have the opposite effect we examine the consequences of a recent australian state law that restricts union political activity but does not change collective bargaining rights in the wake of this law the equity values of affected unionized firms significantly increase and consistent with this market reaction these firms are able to bargain for more favorable labor contracts than their unionized peers in other states the evidence strongly suggests that unions use political activism to extract rents from shareholders and benefit their members

unemployment and welfare consequences of international outsourcing under monopolistic competition this paper challenges the conventional academic view that international outsourcing is just another form of gainful trade contrary to that view we show that labour service outsourcing can reduce the high wage country s welfare even when product market trade is beneficial within a model that combines involuntary unemployment and monopolistic competition outsourcing s impact on welfare is worsened by a definite loss of jobs and a possible contraction in the range of varieties produced worldwide while owners of capital benefit from outsourcing under certain conditions labour s welfare always falls resume consequences de la sous traitance internationale sur le chomage et le bien etre en regime de concurrence monopolistique ce texte remet en question le point de vue conventionnel des universitaires pour qui la sous traitance internationale n est qu une autre forme de commerce porteur de gains en opposition a ce point de vue on montre que la sous traitance de services de travail peut reduire le niveau de bien etre du pays a hauts salaires meme quand le commerce dans le marche des produits est benefique dans un modele qui combine chomage involontaire et concurrence monopolistique l impact de la sous traitance sur bien etre est rempire par une perte d emplois et une contraction possible de la variete de produits au plan mondial alors que les proprietaires de capital beneficient de la sous traitance dans certaines conditions le bien etre du travail decline toujours

teacher pay and school productivity exploiting wage regulation abstract the impact of teacher pay on school productivity is a central concern for governments worldwide yet evidence is mixed in this paper we exploit a feature of teacher labour markets to determine the impact of teacher wages teacher wages are commonly set in a manner that results in flat wages across heterogeneous labour markets this creates an exogenous gap between the outside labour market and inside regulated wage for teachers we use the centralised wage regulation of teachers in england to examine the effect of pay on school performance we use data on over 3000 schools containing around 200 000 teachers who educate around half a million children per year we find that teachers respond to pay a ten percent shock to the wage gap between local labour market and teacher wages results in an average loss of around 2 in average school performance in the key exams taken at the end of compulsory schooling in england

gone fishing reported sickness absenteeism and the weather i introduction the principal agent problem of contracting employee work effort that is imperfectly monitored arises in a number of areas of economic theory including models of remuneration by seniority lazear 1979 involuntary unemployment e g shapiro and stiglitz 1984 performance based pay macleod and malcomson 1998 and labor hoarding depken redmount and snow 2001 given the importance of this mechanism in the theoretical work the empirical research on the agency problem is remarkably scant in part this reflects the limited availability of personnel data as baker and holmstrom argue in their review article internal labour markets too many theories too few facts 1995 but more fundamentally it reflects the inherent difficulty of empirically capturing the employee effort levels that underlie the models using direct measures of employee or firm level productivity is unquestionably the preferred approach but these measures are notoriously problematic and the studies that use them tend to be case studies introducing external validity issues it is also unlikely to isolate the type of malfeasant shirking behavior that concerns variants of the models where the employee effort decision entails disciplinary risk to inform employee incentives to engage in malfeasant behavior economists have relied on two measures employee disciplinary rates e g cappelli and chauvin 1991 ichino and maggi 2000 and absenteeism rates e g arai and thoursie 2005 bradley green and leeves 2007 ichino and riphahn 2005 the difficulty is that disciplinary rates capture only shirking activity that is identified by employers not that which goes undetected while reported absenteeism particularly sickness absenteeism rates may be entirely legitimate one can therefore never be sure whether differences in these rates across workers facing different shirking costs reflect actual shirking activity as opposed to differences in employers willingness or ability to detect and punish shirkers or differences in employee health that may be correlated with these costs in this paper we identify a different type of shirking activity that potentially addresses both of these shortcomings employees misreporting health in order to exploit weather conditions favorable to high utility outdoor recreation 1 we begin by considering a shirking model of sickness absenteeism in which employees marginal utility of outdoor leisure is increasing in the interaction of two state dependent parameters health and outdoor weather quality the intuition being that ideal weather conditions for engaging in outdoor recreation are valued more when one is physically and perhaps also mentally healthy this assumption leads to two main propositions first increases in sickness absenteeism associated with marginal improvements in weather quality reflect the decisions of the inframarginal workers those workers who in the absence of the weather improvement would be present at work who are the healthiest implying an increase in absenteeism that is unambiguously illegitimate second comparing across workers marginal weather improvements should have the largest impact on sickness absenteeism where shirking costs are highest the reason is that where existing incentives to misreport health are the weakest such as where sick pay is not offered or job protection is weak existing sickness absenteeism levels will be lowest and the inframarginal workers will be the healthiest thereby benefitting most from the weather improvement we examine the empirical relevance of these propositions using a two step approach first we construct an index of weather preferences by linking temperature relative humidity precipitation wind speed and cloud cover data to time use data identifying the weekend and weekday evening outdoor recreational activities of employees with regular daytime work schedules we then examine the empirical relation between the resulting index of the recreational quality of the weather hereafter referred to simply as weather quality and the incidence of short term spells of sickness absenteeism reported in survey data comparing the magnitude of this relation across workers facing different levels of sick pay job protection and job finding rates

the determinants of dismissals tests of the shirking model with individual data abstract this study tests the shirking model by estimating dismissal equations with data on individual workers fires were found to depend negatively on firm size and on the local and industry unemployment rates and to depend positively on the capital labor ratio

preferential trading agreements an investigation abstract a three country general equilibrium model of international trade in an arbitrary number of goods is constructed and the welfare effects of the formation of a preferential trading club e g customs union free trade area are analyzed

making do with less working harder during recessions why did productivity rise during recent recessions one possibility is that average worker quality increased a second is that each incumbent worker produced more the second effect is termed making do with less using data from 2006 to 2010 on individual worker productivity from a large firm these effects can be measured and separated for this firm most of the gain in productivity during the recession was a result of increased effort additionally the increase in effort is correlated with the increase in the local unemployment rate presumably reflecting the costs of losing a job

estimation and use of risk aversion coefficient for traditional dryland agriculture in western sudan abstract this paper explores the importance of including risk when modeling subsistence oriented agriculture in a developing nation the specific objective is to measure the degree of risk aversion for typical farmers in the smallholder traditional agriculture of the sudan the procedure followed is to impute the farmer s risk aversion coefficient through a mathematical risk programming technique imputed farmers risk aversion coefficients were used to validate the model specified and identify for further analysis a single risk optimal farm plan for each of the different farm situations studied

regional organizations and international politics japanese influence over the asian development bank and the un security council do regional hegemons use their power in regional organizations to advance foreign policy objectives the authors investigate whether japan leverages its privileged position at the asian development bank adb to facilitate project loans for the elected asian members of the united nations security council unsc a platform from which it seeks to shape global affairs analyzing panel data of adb loan disbursements to twenty four developing member countries from 1968 to 2009 the authors find that temporary unsc membership increases adb loans particularly during the post 1985 period when japan asserted greater influence in multilateral organizations they estimate an average increase of over 30 percent because of japan s checkered history of imperialism the adb provides a convenient mechanism by which the government can obfuscate favors for politically important countries acting through this regional organization enables japan to reconcile a low key approach to foreign affairs with the contradictory goal of global activism leading without appearing unilateralist

recent regional agreements why so many why so much variance in form why coming so fast and where are they headed recent years have seen a sharp growth in the number of regional agreements both concluded and under negotiation this paper attempts to document and discuss this growth focusing on us eu chinese indian and other agreements the form coverage and content of these agreements vary considerably from case to case the paper asks why so many why the variation in form and why the recent acceleration implications for the trading system are discussed in a final section

empirical tests of efficiency wage models two digit manufacturing industry level production functions are used to test efficiency wage propositions conclusive tests require functional forms which allow differences in elasticities of substitution between observable human capital wage premia and other inputs results demonstrate that unexplained industry wage premia and higher unemployment rates raise productivity wage premia and the human capital wage component cannot be aggregated into a single human capital index nevertheless 88 of the productivity effect associated with industry wages can be tied to observable human capital in the industry with only 12 associated with the wage premium

the unconditional most favored nation clause and the maintenance of the liberal trade regime in the postwar 1870s international institutions within the past thirty years become the subject of renewed interest as scholars vigorously dispute their utility neorealists draw on the post world war ii era to advance sweeping general claims of institutional inefficacy this study by contrast deploys the same hard test method grieco applied to the 1970s tokyo round negotiations to the crisis rife 1870s to construct a unique methodological objective a rigorous hard test of nineteenth century institutional autonomy three principal findings emerged first the maintenance of a liberal world economy in the turbulent 1870s is explained by an unlikely commercial instrument and the unprecedented regime design of an unexplored international institution respectively the unconditional most favored nation mfn clause and the informal conventional tariff system cts regime it underpinned not british hegemony second the international trade regime was not a public good unilaterally provisioned by hegemonic britain via the 1846 corn laws repeal the regime was instead a private good that was collectively provisioned by all its constituent member states via the unprecedented interstate practices institutionalized in the 1860 cobden chevalier treaty and then autonomously maintained by a negarchical and self enforcing sanctioning mechanism finally the informal cts regime s enforcement mechanism autonomously altered the interests and behaviors of states in directions incongruent with executive preferences solely through the brute force of rational calculations imposed by decentralized international institutional constraints both the french and british executives in the 1870s believed the regime was normatively inappropriate and unsuccessfully attempted to exit amid eight system threatening crises nonetheless the mfn based regime s self enforcing sanctioning mechanism autonomously induced compliance conceptualized as unitary states behavior deviating from executives first order preference the extraordinarily turbulent 1870s therefore provide an unexplored historical vantage point to make strong institutionalist claims in an era issue area and under conditions that they are least likely to be validated

growing apart the changing firm size wage premium and its inequality consequences wage inequality in the united states has risen dramatically over the past few decades prompting scholars to develop a number of theoretical accounts for the upward trend this study argues that large firms have been a prominent labor market institution that mitigates inequality by compensating their low and middle wage employees with a greater premium than their higher wage counterparts large u s firms reduced overall wage dispersion yet broader changes to employment relations associated with the demise of internal labor markets and the emergence of alternative employment arrangements have undermined large firms role as an equalizing institution using data from the current population survey and the survey of income and program participation we find that in 1989 although all private sector workers benefited from a firm size wage premium the premium was significantly higher for individuals at the lower end and middle of the wage distribution compared to those at the higher end between 1989 and

crisis era protectionism and the multilateral governance of trade an assessment this paper examines the multilateral governance of trade along with the prospects for its meaningful reform in the light of recent crisis era discrimination against the many types of cross border commerce prior episodes of protectionism provide a useful benchmark the findings are not optimistic the current set of multilateral rules is incomplete has weak incentives for compliance and can be readily circumvented only a far reaching revision of these rules could induce more restraint

measuring the restrictiveness of trade policy this article provides an introduction to the trade restrictiveness index tri which equals the uniform tariff that is welfare equivalent to a given pattern of trade protection unlike standard measures of trade restrictiveness the tri has a solid theoretical basis can incorporate both tariffs and quantitative restrictions and can be adapted to construct the trade policy equivalent of domestic distortions the article compares a number of applications and describes procedures for operationalizing the tri on a personal computer the authors conclude that the tri has considerable potential in empirical work

radical political economy and the economics of labor markets this essay is the result of a long process involving many drafts and revisions i am grateful to duncan foley for the careful and constructive criticisms offered throughout the project the following people read the manuscript at different stages and although they often disagreed with me they generously provided helpful comments two anonymous referees for this journal samuel bowles william dickens greg dow robert drago richard edwards kathleen engel richard freeman james galbraith herbert gintis jody hoffer gittel sandfordjacoby tom kochan david levine lisa lynch paul osterman michael piore bob rebitzer gil skilman dan slesnick robert thomas and tsuyoshi tsuru comments from participants in seminars at the massachusetts institute of technology university of massachusetts at amherst and hitotsubashi university are also gratefully acknowledged