the rise and fall of the washington consensus as a paradigm for developing countries abstract the introduction of the washington consensus involved not simply a swing from state led to market oriented policies but also a shift in the ways in which development problems were framed and in the types of explanation through which policies were justified key changes were the partial globalization of development policy analysis and a shift from historicism to ahistorical performance assessment the main challenge to this approach is a latent southern consensus which is apparent in the convergence between east asian developmentalism and latin american neostructuralism the demise of the washington consensus is inevitable because its methodology and ideology are in contradiction

rewards to investors in innovative information technology applications first movers and early followers in atms innovative information technology it applications are risky investments unless successful applications provide innovators with exceptional returns these investments would not be justified other than a few case studies there is no evidence that the first movers of successful it applications are rewarded for the risks they bear we present the results of an extensive longitudinal study of the effects of early adoption of automated teller machines atms by banks on market share and income the study spans the period from 1971 to 1983 and includes 2 534 banks from across the united states results indicate that the earliest adopters 1971 through 1973 were able to increase market share with market share gains being sustained for a long time banks that adopted atms between 1974 and 1979 however did not gain market share the results also indicate that early atm adoption enabled banks to increase income and income gains were sustained for a long time these findings support case study evidence that early adoption of new it applications can lead to long term competitive advantages for firms

specifying the dynamics of industry concentration previous studies generally explain changes in concentration by its initial determinants or by changes in its determinants little attention is paid to the dynamic structure of the model this study provides a framework to sort out adjustment effects in a systematic manner the empirical model distinguishes long term from short term effects and estimates the rate of adjustment when concentration deviates from its long term equilibrium level considerable attention has focused on industry concentration as a key element of market structure while earlier empirical studies examined determinants of the level of industry concentration a more recent literature focuses on changes in concentration these more recent papers typically explain intertemporal changes in concentration by the past levels of industry growth concentration advertising intensity and minimum efficient plant size however the dynamic relationship between changes in concentration and the levels of the independent variables has not been explicitly specified caves and porter 1980 have argued that explaining changes in concentration by past levels of market structure variables is tantamount to assuming that the sampled industries are in the process of adjusting to a disequilibrium situation as an alternative they adopt a long term equilibrium approach whereby changes in concentration are explained by lagged changes in the relevant market conditions they find that this approach as a whole was unsuccessful exhibiting low levels of significance and a lack of robustness when the cross section regressions were shifted to different time periods

stationary sunspot equilibria in a finance constrained economy abstract stationary sunspot equilibria are shown to exist in a production economy with infinite lived agents when it is not possible to borrow against future wage income equilibrium fluctuations exhibit persistence over time scales of the same order of magnitude as observed business cycles an active fiscal policy that stabilizes aggregate money expenditures can prevent such fluctuations

determinacy of equilibrium in stationary economies with both finite and infinite lived consumers abstract we consider the determinacy of perfect foresight equilibrium near steady state equilibria of stationary infinite horizon economies the work of t j kehoe and d k levine econometrica 53 1985 433 453 is generalized by the inclusion of both infinite lived agents and overlapping generations of finite lived agents and the inclusion of production and non depreciating pure rents we show that indeterminacy is possible in robust examples and that the dimension of the indeterminacy can be as large as the number of goods per period we also discuss extreme cases in which determinacy is guaranteed

the impact of federal incentives on the adoption of hybrid electric vehicles in the united states abstract starting in 2004 the federal government in the united states offered several nationwide incentives to consumers to increase the adoption of hybrid electric vehicles this study assesses the effectiveness of the energy policy act of 2005 in this regard using econometric methods and data between 2000 and 2010 our model accounts for network externalities by using lagged sales as an independent variable this approach helps to capture the exponential initial growth associated with the diffusion of new technologies and avoids overestimating the effect of the policy incentives our results show that the energy policy act of 2005 increased the sales of hybrids from 3 to 20 depending on the vehicle model considered in addition we find that this incentive is only effective when the amount provided is sufficiently large

toward an economic model of the japanese firm i owe a great deal to professor moses abramovitz who suggested that i write this article i appreciate his constant encouragement and guidance which aided me throughout its preparation i am also indebted to three anonymous referees of the journal and to professors ryutaro komiya and michael riordan for their critical comments and helpful suggestions needless to say i am solely responsible for the views expressed in this paper

how does incompatibility affect prices evidence from atm s if consumers value mix and match combinations of network complements incompatibility between different sellers components should affect prices in atm markets a 1996 governance change exogenously generated such incompatibility by allowing banks to impose surcharges when other banks deposit customers use their atm s in our data incompatibility makes the relationship between deposit account pricing and own atm s more positive and makes the relationship between deposit account pricing and competitors atm s more negative the level effect on prices is positive the pattern of results is more pronounced in high population density markets where customers may care more about atm s

a general equilibrium analysis of price controls and subsidies on food in mexico abstract in this paper we present a general equilibrium model that permits a thorough analysis of the effects of government pricing policies in particular we study the effects of price controls and subsidies on agricultural and food items in mexico we analyze alternative policies for reducing the government deficit by cutting subsidies and increasing indirect taxes our results indicate that although food subsidies need to be reduced maintaining some subsidies would have a favorable impact on income distribution

third world competition and de industrialisation in advanced countries rapid industrialization in the third world during the last three decades and the continuing fast expansion of the south s manufacturing exports to the advanced countries has raised the question whether these have or will in the future lead to deindustrialization in the north this paper provides a consistent conceptual framework for analyzing this issue which is then applied to the experience of the u k economy it is concluded that in the 1970s u k manufacturing trade with the south lead to an increase rather than a decline in output and employment however the paper also provides evidence that in the future this trade is likely to become a source of disequilibrium and may contribute to deindustrialization copyright 1989 by oxford university press

income distribution and growth in east asia it is widely believed that the east asian economies performed exceptionally well not only in generating growth but also in keeping inequality low this study tries to answer the questions raised by the claims of exceptionality of income distribution in east asia central findings are that only japan korea and taiwan have legitimate claims to low inequality that the east asian economies distinguished themselves by their ability to translate high profit shares into high savings and investment rates and that low inequality and high profit shares coexisted primarily due to the unusually even distribution of wealth

introduction to intertemporal equilibrium theory indeterminacy bifurcations and stability institute of economic research kyoto university yoshida honmachi sakyoku kyoto 606 japannishimura kier kyoto u ac jpthis paper provides an overview of the basic concepts of intertemporal equi librium theory and discusses the frameworks and techniques used in this subject it then goes on to introduce the main themes discussed in the papers included inthis symposium issue journal of economic literature classification numbers c61 d90 o41

the desirable form of openness for indian agriculture how open should a developing country s agriculture be to the world economy what are the medium term effects for growth and income distribution of close integration with world agricultural markets through trade liberalisation and domestic reform and what are the implications of the strategic integration of agriculture with world markets using a dynamic computable general equilibrium model these questions are addressed for the indian economy the simulation results show that the costs of close integration are large and unevenly distributed irrespective of whether the agricultural reform is immediate or gradual one form of strategic integration is operationalised that yields more desirable outcomes in terms of growth and income distribution the paper also compares the effectiveness of the two policy regimes in coping with an adverse supply shock copyright 2001 by oxford university press

comparative statics and perfect foresight in infinite horizon economies does a pure exchange economy with an infinite time horizon have determinate perfect foresight equilibria when there is a finite number of infinitely lived agents equilibria are generically determinate this is not true with overlapping generations of finitely lived agents we ask whether the initial conditions together with the requirement of convergence to a steady state locally determine an equilibrium price path in this framework there are many economies with isolated equilibria many with continua of equilibria and many with no equilibria at all with two or more goods in every period not only can the price level be indeterminate but relative prices as well furthermore such indeterminacy can occur whether or not there is fiat money and whether or not the equilibria are pareto efficient this paper considers whether infinite horizon economies have determinate perfect foresight equilibria this question is of crucial importance if instead equilibria are locally indeterminate not only are we unable to make comparative static predictions but the agents in the model are unable to determine the consequences of unanticipated shocks the idea underlying perfect foresight is that agents expectations should be the actual future sequence predicted by the model if the model does not make determinate predictions the concept of perfect foresight is meaningless we consider two extreme cases the first with a finite number of infinitely lived consumers and the second with an infinite number of finitely lived consumers an overlapping generations model both are models of stationary pure exchange economies no production including the storage of goods between periods can occur these models are unrealistic but are the easiest to study extensions of the results of this paper to models with production infinitely lived assets and mixtures of the two types of consumers are presented by muller and woodford 29 when there is a finite number of infinitely lived consumers we argue that equilibria are generically determinate this is because the effective number of equations determining equilibria is not infinite but equal to the number of agents minus one and must determine the marginal utility of income for all but one agent generically near an equilibrium these equations are independent and exactly determine the unknowns when there are infinitely many overlapping generations this reasoning breaks down an infinite number of equations is not necessarily sufficient to determine

strategic incompatibility in atm markets abstract we test whether firms use incompatibility strategically using data from atm markets high atm fees degrade the value of competitors deposit accounts and can in principle serve as a mechanism for siphoning depositors away from competitors or for creating deposit account differentiation our empirical framework can empirically distinguish surcharging motivated by this strategic concern from surcharging that simply maximizes atm profit considered as a stand alone operation the results are consistent with such behavior by large banks but not by small banks for large banks the effect of incompatibility seems to operate through higher deposit account fees rather than increased deposit account base

determinacy of equilibrium in an overlapping generations model with heterogeneous agents abstract we study the determinacy of perfect foresight equilibrium near a steady state in an overlapping generations model with production and both altruistic and non altruistic agents having distinct utility functions the proportion of each type of consumer is exogenously given our main results show that when there are positive stationary bequests some standard assumptions on preferences and technology rule out local indeterminacy for any positive value of the proportions in the particular case of a separable utility function for altruistic agents we prove that the determinacy property does not depend on the size of the infinite lived altruistic dynasties journal of economic literature classification numbers c62 d91 o21 o41

openness and the market friendly approach to development learning the right lessons from development experience abstract two central policy issues in economic development today are how open should a developing country be to the world economy and what should the government do or not do to promote rapid growth this paper examines these questions in relation to the highly successful east asian countries and contributes to the debate between world bank and heterodox economists the paper suggests that there has been significant convergence between the two schools on analytical and empirical issues but not on policy it takes this debate further by analyzing the principal issues still in contention

monopolistic competition dynamic inefficiency and asset bubbles abstract we emphasise the importance of the market structure to determine whether dynamic inefficiency is possible in a closed economy we analyse alternative monopolistic competition frameworks where the existence of pure profit involves the presence of an asset market when entry is blockaded dynamic inefficiency is prevented as each firm uses a discount rate higher than the output growth rate in evaluating future profits when entry is free but involves sunk costs we need to distinguish between the possibility of asset bubbles and dynamic inefficiency the condition for the latter being more stringent if entry costs increase with per capita output dynamically inefficient equilibria are possible only when population grows

the impact of technology adoption on market structure this paper examines the impact of bank adoptions of automated teller machines atms on subsequent levels of concentration in local banking markets the findings suggest that banks have had some success in using atms to attract customers from competitors as a consequence technology adoption s impact on market structure depends upon whether it is the larger or smaller firms within the market that adopt the new technology large firm adoptions increase concentration levels while small firm adoptions tend to reduce them the evidence also suggest that a state of structural disequilibrium seems to be characteristic of banking markets copyright 1990 by mit press

the limits of trade policy reform in developing countries trade reform is now raising some new issues this paper deals with three sets of questions first how can trade reform be sustained can governments convince business labor or consumers that trade reform will be lasting so as to forestall possible adverse reactions that would jeopardize the sustainability of the reform second what role should trade reform play when it is implemented in the context of macroeconomic instability are there potential conflicts between the standard desiderata for trade reform and the requirements of macro stability finally should we be worried about the consequences of trade reform in the imperfectly competitive market environments that characterize the developing economies

was japan s industrial policy successful some discordant voices however began to be heard by the mid 1970s while european writers were still supporting the conventional wisdom michalski et al 1972 carducci and padoa schioppa 1973 sautter 1973 boltho 1975 doubts about the effectiveness of government intervention were expressed in the united states in an authoritative survey of the economy patrick and rosovsky 1976 more recently this form of revisionism has gone further in a very careful reading of the evidence trezise 1983 has come to a sceptical conclusion about the role of japan s industrial policy according to him the major actor in post war growth was the free play of market forces driven by dynamic entrepreneurs and buttressed by high saving propensities

the optimal degree of competition and dynamic efficiency in japan and korea abstract this paper is concerned with the neglected role of competition policy in east asian development michael porter considers japan s development to have benefitted from intense competition among firms by contrast caves and uekusa criticize miti s role in creating recession cartels and entry barriers which are thought to have resulted in allocative inefficiency this paper argues that competition policy in both japan and korea was oriented towards creating dynamic efficiency the highest long term productivity growth rate it did so by measures operating at both the industry and firm level which sometimes restricted competition and sometimes encouraged it

is free trade passe abstract if there were an economist s creed it would surely contain the affirmations i understand the principle of comparative advantage and i advocate free trade yet the case for free trade is currently more in doubt than at any time since the 1817 publication of ricardo s principles of political economy and this is due to changes that have recently taken place in the theory of international trade while new developments in international trade theory may not yet be familiar to the profession at large they have been substantial and radical in the last ten years the traditional constant returns perfect competition models of international trade have been supplemented and to some extent supplanted by a new breed of models that emphasizes increasing returns and imperfect competition these new models call into doubt the extent to which actual trade can be explained by comparative advantage they also open the possibility that government intervention in trade via import restrictions export subsidies