market concentration and competition in eastern europe a key feature of soviet type economies is the excessive concentration of production and the skewed size distribution of enterprises this is the root cause of the soft budget constraint and a natural outcome of the political economy of these countries given entrenched political support for a system which favours producers relative to consumers it will be hard to pursue an active competition policy though it is essential for successful reform we examine a hypothetical restructuring of polish state enterprises and argue that this should be undertaken before they are privatized hungary appears to have started such a process already this abstract was borrowed from another version of this item

the role of multilateral institutions in international trade cooperation the world trade organization wfo lacks the power to directly enforce agreements it is therefore important to understand what role the wto can play to facilitate international cooperation and whether a multilateral institution can offer distinct advantages over a web of bilateral agreements this paper examines two potential benefits of a multilateral trade institution first verifying violations of the agreements and informing third parties thus facilitating multilateral reputation mechanisms second promoting multilateral trade negotiations rather than a web of bilateral negotiations the model suggests that a multilateral approach is particularly important when there are strong imbalances in bilateral trading relationships

constrainedly fair job assignments under minimum wages a number of jobs are to be assigned to a greater number of workers while having to abide by the law of minimum wages firms must determine who should be assigned which job and at what salary in such situations fair envy free allocations usually fail to exist to cope with this situation this paper proposes a new concept of fairness called constrained fairness among the set of constrainedly fair allocations the so called constrainedly fair and minimal allocations are of particular interest the reason for this is that the salaries are not only compatible with the minimum wages they are also optimal from the standpoint of cost minimizing firms and the assignment of jobs is efficient from the viewpoint of workers a convergent dynamic procedure that identifies constrainedly fair and minimal allocations is proposed furthermore strategic properties of the mechanism are derived and two notions of efficiency are evaluated

explaining cooperation under anarchy hypotheses and strategies what circumstances favor the realization of mutual interests in the absence of centralized authority and through what strategies can nations foster the emergence of cooperation by altering the circumstances that they confront elementary game theory suggests three sets of conditions that serve as proximate explanations of the incidence of cooperation and discord i payoff structure mutual and conflicting preferences 2 the shadow of the future single play and iterated games and 3 number of players two person and n person games each of these three attributes of context may be subject to willful modification nations may create the preconditions for cooperation through strategies to alter payoffs lengthen the shadow of the future and reduce the number of actors required to realize limited mutual interests

competition and corporate performance are people right to think that competition improves corporate performance my investigations indicate first that there are some theoretical reasons for believing this hypothesis to be correct but they are not overwhelming furthermore the existing empirical evidence on this question is weak however the results reported here based on an analysis of around 670 u k companies do provide some support for this view most important i present evidence that competition as measured by increased numbers of competitors or by lower levels of rents is associated with a significantly higher rate of total factor productivity growth

competition and corporate governance in transition this paper examines the elements of institutional development critical to the enhancement of company performance in transition economies this includes initial conditions forms of privatization institutional frameworks and the competitiveness of markets comparing empirical evidence the paper concludes that there is a clear distinction in effectiveness of policies followed and their impact between central europe and cis countries this divergence is attributed to fundamentally different political attitudes toward reform the need of cis governments to gain political support for reform and as a consequence of the desire of central european countries to join european union

black hole tariffs and endogenous policy theory political economy in general equilibrium preface acknowledgments list of results 1 a preview of the results 2 endogenous policy theory a diagrammatic approach part i endogenous policy theory with specific factors the theory of industry tariffs in partial equilibrium 3 the probabilistic voting model of political efficiency and powerless politicians 4 endogenous lobbying theory and the contribution specialization theorem 5 endogenous tariff theory 6 the power function model of endogenous industry lobbying 7 three simple tests of the stolper samuelson theorem 8 the invisible foot and the waste of nations lawyers as negative externalities part ii endogenous policy theory in general equilibrium a long run theory of national tariff levels 9 the 2 x 2 x 2 x 2 model of endogenous redistribution theory 10 a prisoner s dilemma theory of endogenous protection the leontief model 11 the compensation effect and the multiple equilibrium trap 12 increasing returns to politics and factor endowments economic development and brazilian vitality versus the indian disease 13 endogenous protection in the united states 1900 88 14 a cobb douglas model 15 black hole tariffs 16 the endowment effect cross national evidence on endogenous tariffs part ii postscript 17 the senile industry argument for protection 18 optimal obfuscation and the theory of the second worst the politically efficient policy mathematical appendices references author index subject index

are incentives against economic justice abstract we consider the problem of fairly allocating a social endowment of indivisible goods and money when the domain of admissible preferences contains but is not restricted to quasi linear preferences we analyze the manipulability of the generalized money rawlsian fair gmrf solutions i we show that the nash and strong nash equilibrium correspondences of the preference revelation game form associated with each gmrf solution coincide with the no envy solution in equilibrium efficiency is preserved according to agents true preferences ii a corollary is that the gmrf solutions naturally implement the no envy solution in nash and strong nash equilibria

double implementation in a market for indivisible goods with a price constraint i consider the problem of assigning indivisible objects to agents in which each agent pays a price for his object and all prices sum to a given constant the objective is to select an assignment price pair that is envy free with respect to the agents true preferences i propose a simple mechanism whereby agents announce valuations for all objects and an envy free allocation is selected with respect to these announced preferences i prove that the proposed mechanism implements both in nash and strong nash equilibrium the set of true envy free allocations

price quantity strategic market games this paper is yet another in a rapidly growing series e g 2 11 on strategic approaches to economic equilibrium our aim here is to make precise the remark implicitly due to bertrand 1 or 10 ch 4 5 that if the agents in an economy use price setting strategies then the strategic nash equilibria will in fact be walrasian and this without any assumption of a large number of small agents however in our models not only prices but also quantities are set by the agents thus it might actually be more appropriate to call them bertrand cournot types of models we begin with a standard walras exchange economy with a finite number of traders and commodities this is recast as a game in strategic form in essentially two different ways there is a trading post for each commodity to which traders send contingent statements about how much they wish to buy and sell and at what prices in model 1 the trading point is determined by the intersection of the aggregate supply and demand curves in model 2 trade takes place so as to meet as many contingent statements as possible each buyer whose orders are filled pays the price he quoted using a fiat money which can be borrowed costlessly and limitlessly but after trade is over there is a settlement of accounts and a penalty is levied on those who are bankrupt no attempt is made to model the penalty in any detail it is simply described in the form of a disutility but this in turn may be imagined to stem from confiscation of assets see remark 5 or the necessity of procuring highly priced loans etc call a noncooperative equilibrium active if it turns out that no trader is isolated i e trapped as the sole buyer or seller at some trading post then our results may be described as follows in model 1 the active2 n e of the game coincide with the c e of the market furthermore there is a subset of tight active n e which also coincide with the c e and each n e in this subset is strong

elicitation of honest preferences for the assignment of individuals to positions the problem of eliciting honest preferences from individuals who must be assigned to a set of positions is considered individuals know that they will be charged for the positions to which they are assigned a set of prices that provide no incentive for the individual to misrepresent his preferences is suggested it is shown that these prices constitute an element of the optimal solution to the dual of a linear programming assignment problem both the optimal allocation and the prices to be charged can be derived by solving two linear programming problems once preferences have been elicited the procedure can usefully be viewed as a simulation of a competitive market under conditions where such a market cannot be expected to function well it results in an efficient allocation where all resources are valued at their opportunity costs and consumer surplus is maximized its outcome thus has the desirable properties of competitive market equilibria

competitive fair division several indivisible goods are to be divided among two or more players whose bids for the goods determine their prices an equitable assignment of the goods at competitive prices is given by a fair division procedure called the gap procedure that ensures 1 nonnegative prices that never exceed the bid of the player receiving the good 2 pareto optimality though coupled with possible envy 3 monotonicity such that higher bids never hurt in obtaining a good 4 sincere bids that preclude negative utility and 5 prices that are partially independent of the amounts bid as in a vickrey auction a variety of applications are discussed

large indivisibles an analysis with respect to price equilibrium and fairness an exchange economy is considered in which there are a finite number of individuals the same number of indivisibles and a fixed amount of a divisible good each individual consumes exactly one of the indivisibles and a certain quantity of the divisible good the existence of prices corresponding to pareto efficient allocations is proved it is also shown that this economy possesses fair allocations income fair allocations coalition fair allocations and pareto efficient egalitarian equivalent allocations in this study the effect of including large indivisibles in an exchange economy will be analyzed the analysis will be carried out with respect to the existence of price equilibrium and with respect to the existence of different forms of fairness the economy consists of a finite number of individuals the same number of indivisibles and a fixed amount of a divisible good it is assumed that each individual consumes exactly one of the indivisibles and some quantity of the divisible good we may interpret the indivisibles as being professions or houses the relationship between price equilibrium and a pareto efficient allocation is well known and proved in a number of cases under different assumptions about preferences and commodities for a standard economy see e g debreu 5 in case of nonconvexities which may also describe a certain type of indivisibility we may have an exact relationship in economies with a continuum of individuals see e g hildenbrand 11 but otherwise an approximate relationship obtains the degree of approximation depends on the degree of nonconvexities in preferences and not on the number of individuals see e g arrow and hahn 1 we will prove the existence of prices characterizing a pareto efficient allocation in a case where the indivisibles play an essential role and where approximate results would be too approximate the indivisibles may be considered large for the individual compared to his total consumption the theory of fairness has developed considerably during the seventies different kinds of concepts of fairness have been introduced and analyzed see daniel 41 foley 81 pazner and schmeidler 121 and schmeidler and vind 141 among others normally these authors have considered models with divisible goods or an infinite number of individuals for exchange economies the existence of fair allocations an envy free and pareto efficient allocation has been proved in

enterprise reform and corporate governance in russia a quantitative survey the objective of this paper is to verify the range and depth of the study on corporate governance in russia through a comprehensive survey of 202 research works with regard to the internal structure of russian corporations a great deal of research has been conducted in a relatively short time since the collapse of the soviet union by many highly motivated researchers who have provided insightful perspectives these achievements however place too much emphasis on the empirical analysis of the interrelation between ownership structure and corporate restructuring leaving some critical themes open for further discussion as the 21st century begins a well balanced research base should be established in this field in order to identify the reality of russian corporations from a multifaceted perspective

from theory into practice restructuring and dynamism in transition economies this paper draws on microeconomic industry level and macroeconomic evidence to investigate the mecha nisms of enterprise restructuring in transition economies its outcomes in terms of industry level export perform ance and its interaction with macroeconomic policy and constraints the aim is to throw light on the process by which catch up is taking place in the leading transition economies we begin at the micro level and find that institutional changes have produced improvements in performance more or less in line with theoretical predic tions variation in the extent ofpolicy changes helps to account for cross country differences in restructuring behaviour in the leading transition countries where growth has been under way for a number of years many features of the enterprise sector differentiate it from that of an advanced market economy to measure the extent of catch up associated with the reforms use is made of detailed information about the quality of goods traded on the eu market in the final section the inclusion of macroeconomic constraints allows distinctive transition paths to catching up in the visegrad countries to be identified

does ownership always matter abstract the objective of this paper is to explain and illustrate the complex relationship between ownership arrangements and enterprise performance it is commonly argued that efficiency will be lower in the public sector than the private because enterprise objectives deviate from maximisation of profits and because monitoring arrangements are inadequate due to the absence of capital market discipline we argue that public ownership does make the owner manager relationship more complicated because the chain of principals and agents is expanded objectives are politically determined and these are conveyed by a policy making administrative structure to management but the relative efficiency of public as against private ownership actually depends on the efficacy of capital market monitoring on the political and constitutional system on the information and sanctions available to policy makers and on the nature of the management market variation in these factors can help to explain the different natures and roles of the public sector between countries

wages and employment in a segmented labor market this paper analyzes the impact of business cycle fluctuations on a labor market segmented into a unionized primary sector and a competitive secondary sector either permanent or temporary changes in real aggregate demand are shown to widen the intersectoral wage differential in recession and under reasonable specifications of key parameters to cause greater fluctuations of primary sector employment than secondary sector employment this pattern agrees with the stylized facts of the u s economy

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

probing theoretically into central and eastern europe transactions resources and institutions since the 1990s central and eastern europe cee has provided unique societal quasi experiments which represent opportunities to test the applicability of existing theories in international business and management studies and to develop new ones specifically three lines of theorising have been advanced 1 organisational economics theories 2 resource based theories and 3 institutional theories for each of these theories we discuss how they contribute to the understanding of key issues such as entry strategies of foreign investors restructuring strategies of local incumbents and entry and growth strategies of entrepreneurs on this basis we assess how cee research has influenced the overall trajectories of theory development cee research has in particular highlighted the importance of contextual influences such as institutions thus scholars have aimed at incorporating institutions into theories such as organisational economics theories and resource based theories and advancing an institution based view of business strategy as a complementary perspective we outline how future research in cee and other emerging economies may advance this research agenda further

do international rulings have spillover effects the view from financial markets how influential are international courts can their rulings reach beyond a given case and affect the behavior of countries not party to the dispute international law is clear on the matter rulings have no formal authority beyond the case at hand this tenet is consistent with the incentives of sovereign states wary of delegating too much authority to courts by contrast the authors claim that even in the absence of formal authority the rulings of international courts can affect behavior by mobilizing pro compliance groups in countries not party to a dispute they test these beliefs in the context of the world trade organization wto through a novel approach because wto rulings have implications for the fortunes of publicly traded firms they examine whether financial markets bet on there being spillover effects beyond the case at hand they rely on two quantitative case studies to test for a cross border and a cross industry spillover effect can rulings have effects in countries and on industries other than those at issue in the initial dispute the results suggest that the answer is a tentative yes the spillover effects of international rulings may be a matter of scholarly contention but their existence is something that financial markets appear willing to bet on

joint bidding in the name your own price channel a strategic analysis in this paper we study the name your own price nyop channel we examine theoretically and empirically whether asking consumers to place a joint bid for multiple items rather than bid one item at a time as practiced today can increase nyop retailers profits relatedly we also examine whether allowing consumers to self select whether to place a joint bid or itemwise bids increases retailers profits and consumers surplus we construct a dynamic model that incorporates both demand uncertainty and supply uncertainty to address these issues our theoretical analysis identifies the conditions under which joint bidding can increase both nyop retailers profits and consumers surplus we find that some consumers might bid more for the very same items when they place joint bids the increase in bid amount is related to the fact that joint bidding reduces the chance of mismatch between nyop retailers costs and consumer bids we conducted a laboratory study to assess the descriptive validity of some of the

endogenous asset ownership structures in deregulated markets abstract this paper determines the equilibrium ownership structure in an emerging market deregulated by a joint privatization and investment liberalization it is shown that bidding competition in the privatization stage is not sufficient for reaching an efficient equilibrium market structure competition in the ensuing entry stage is also required otherwise one firm can induce another to take the role of the weak firm in the subsequent product market competition by making concessions in the bidding in the privatization auction it is also shown that employment guarantees may help the buyer of the privatized firm abstain from investing and thus create a less competitive market structure

firms governments and wto adjudication japan s selection of wto disputes what explains the selection of cases for wto adjudication this article explores the business conditions under which industries lobby their home government to use the wto adjudication process and the political factors that influence government decisions it explains the industry pattern of selection for international trade disputes as a function of the velocity of the business environment while wto adjudication is seen as costly and slow a positive ruling brings broad benefits in terms of deterrence against future discrimination firms in static industries will invest in wto dispute settlement to achieve these benefits but firms in industries shaped by dynamic competition have high opportunity costs that make them less willing to pursue adjudication this argument accounts for why there are fewer wto cases about electronics industry issues than there are likely incidences of protectionist measures since japan is a leading exporter and provides a government report with unique data on potential wto disputes it was chosen to test the argument in greater depth interviews with japanese business officials and statistical analysis of an original data set provide support for the argument the authors conclude that the passive attitude toward wto adjudication by japan s largest export industry electronics and the sensitivity of japan s diplomatic relations with china have constrained the cases that japan files these findings suggest that the effectiveness of the wto for dispute settlement is conditional upon the time horizon of the industry and the political relations among members

the package assignment model we study assignment problems where individuals trade packages consisting of several rather than single objects although buyers reservations values are non additive efficient assignments can be formulated as a linear programming problem in which the pricing functions expressing duality may be non linear in the objects constituting the packages the interconnections among the linear programming formulation walrasian equilibrium and the core are established in the single seller auction version a necessary and sufficient condition is given for the vickrey payoff point to be implementable by a pricing equilibrium journal of economic literature classification numbers c62 d44 d51

employment determination in enterprises under communism and in transition evidence from central europe the authors present a comparative analysis of employment determination in four transition economies as they moved from central planning to a market economy in the early 1990s they use firm level panel data sets from the czech republic hungary poland and slovakia to estimate dynamic employment equations for the period from immediately before to immediately after the start of transition for the most part firms appear to have been quick to adjust employment to wage levels and there is little evidence of labor hoarding there were important cross country variations in the determinants of employment during the reform process however hungarian and polish firms started the transition already substantially reformed and became even more responsive to market signals as transition proceeded in contrast firms in the czech and slovak republics started in the completely unresponsive mode characteristic of central planning but rapidly caught up with their counterparts in hungary and poland

broader product line a necessity to achieve success strategic product line breadth decisions evoke differential responses from the manufacturing and the marketing areas manufacturing prefers keeping process disruptions to a minimum and as a result discourages product proliferation however marketing in its attempt to match products to heterogeneous consumer needs and gain market share emphasizes a broader product line we systematically investigate the market benefits and cost disadvantages of broader product lines on a large sample of over 1 400 business units our results indicate significant market share benefits and increases in firms profitability with broader product lines moreover widely held beliefs of increases in production costs are not empirically supported american manufacturing firms may indeed be flexible enough to accommodate product variety without significant detrimental effects on costs

strategyproof assignment by hierarchical exchange we give a characterization of the set of group strategyproof pareto optimal and reallocation proof allocation rules for the assignment problem where individuals are assigned at most one indivisible object without any medium of exchange although there are no property rights in the model the rules satisfying the above criteria imitate a trading procedure with individual endowments in which individuals exchange objects from their hierarchically determined endowment sets in an iterative manner in particular these assignment rules generalize gale s top trading cycle procedure the classical rule for the model in which each individual owns an indivisible good

r d reactions to high technology import competition for a seventeen year panel covering 308 u s manufacturers the authors analyze companies r d spending reactions to changes in high technology imports on average r d sales ratios were reduced in the short run as imports rose reactions tended to be more aggressive the more concentrated the markets were in which the firms operated when company r d operations were multinational and with greater company size and diversification reactions were less aggressive when special trade barriers had been erected reactions became more aggressive over the longer run copyright 1992 by mit press

when does privatization work the impact of private ownership on corporate performance in the transition economies this paper compares the performance of privatized and state firms in the transition economies of central europe while controlling for various forms of selection bias it argues that privatization has different effects depending on the types of owners to whom it gives control in particular privatization to outsider but not insider owners has significant performance effects where privatization is effective the effect on revenue performance is very pronounced but there is no comparable effect on cost reduction overlooking the strong revenue effect of privatization to outsider owners leads to a substantial overstatement of potential employment losses from postprivatization restructuring

macroeconomic determinants of the world trade disputes this article is whether and how the world macroeconomic environments influence the world trade disputes we use two pronged approach first we try to answer the question whether and how global macroeconomic environments are attached to the count of the world trade disputes even if the traditional literature captures it at the national level global picture needs to be completed the second question we address is that given the set of trade dispute initiating countries whether and how differently high middle and low income countries respond to their macroeconomic environments in their decision makings of trade disputes initiations the universe in the second question is a selected set of the filing countries only not all countries on this planet one can capture the behaviours of the countries involved in the trade disputes under certain macroeconomic circumstances the period is from 1995 to 2008 covering all records of trade disputes since the birth of the world trade organization wto

perspectives on multinational enterprises in emerging economies multinational enterprises mnes play a pivotal role in the development of many emerging economies in consequence they became the focus of scholarly research by economists and policy analysts in contrast international business scholars have been comparatively uninterested in analysing this role of mnes yet they could make important contributions to these debates first studies taking the individual firms as starting point would enhance understanding of the interaction between mnes and the local environment second theories and research methodologies developed in international business research could provide new insights into the dynamics of mnes in emerging economies the objective of this paper is to motivate more international business scholars to engage in research on positive and negative spillovers from foreign direct investment fdi in emerging economy societies to advance this research agenda scholars need to analyse the specific activities and capabilities of the firms involved and the impact of fdi on the broader social and environmental context for management this agenda raises the ethical question to what extent ought businesses to care about their local stakeholders

optimal allocation without transfer payments abstract often an organization or government must allocate goods without collecting payment in return this may pose a difficult problem either when agents receiving those goods have private information in regards to their values or needs in this paper we find an optimal mechanism to allocate goods when the designer is benevolent while the designer cannot charge agents he can receive a costly but wasteful signal from them we find conditions for cases in which ignoring these costly signals by giving agents equal share or using lotteries if the goods are indivisible is optimal in other cases those that send the highest signal should receive the goods however we then show that there exist cases where more complicated mechanisms are superior also we show that the optimal mechanism is independent of the scarcity of the goods being allocated

the patent paradox revisited an empirical study of patenting in the u s semiconductor industry 1979 1995 we examine the patenting behavior of firms in an industry characterized by rapid technological change and cumulative innovation recent survey evidence suggests that semiconductor firms do not rely heavily on patents to appropriate returns to r d yet the propensity of semiconductor firms to patent has risen dramatically since the mid1980s we explore this apparent paradox by conducting interviews with industry representatives and analyzing the patenting behavior of 95 u s semiconductor firms during 1979 1995 the results suggest that the 1980s strengthening of u s patent rights spawned patent portfolio races among capital intensive firms but it also facilitated entry by specialized design firms

efficiency and ownership structure the case of poland we examine the effects of foreign entry on productive efficiency during the polish investment liberalisation the performance of foreign acquisitions is compared to foreign firms entering the marke

the strategy structure of two sided matching markets we study two sided markets in which agents are buyers and sellers or firms and workers or men and women the agents are to form partnerships which provide them with satisfaction and at the same time make monetary transfers e g salaries or dowries the core of this market game is shown to have a particularly nice structure so that precise answers can be given to questions concerning comparative statics and manipulability the idea of using walrasian equilibrium as a mechanism for making allocations with desirable properties of fairness and efficiency has been studied extensively the scheme involves having agents specify their supply and demand functions the competitive equilibria are then calculated and allocations are made accordingly in general this procedure may run into two difficulties first nonuniqueness if there are several equilibria there may be no fair way to decide which one should be implemented and second manipulability if there is only one equilibrium an informed agent may be able to influence it by suitably falsifying his demand data however as we will show here using the walrasian mechanism does work remarkably well for a certain class of important markets these are the matching markets of our title and they include markets for single items like houses where it is assumed that traders do not wish to acquire more than one item they also include labor markets in which it is desired to match workers with jobs at suitable salaries academic markets in which students are to be assigned to educational institutions marriage markets where men and women are matched through negotiating of dowries it turns out that in these markets both the problems of nonuniqueness and manipulability can be resolved in a

antidumping and retaliation threats abstract we propose and test two ways in which retaliation threats may dampen the antidumping ad activity we observe first the threat of retaliatory ad actions may make a domestic industry less likely to name a foreign import source in an ad petition second the prospect of a gatt wto trade dispute may make government agencies less likely to rule positive in their ad decision using a nested logit framework we find evidence that both retaliation threats substantially affect us ad activity from 1980 through 1998

no envy and consistency in economies with indivisible goods we consider the problem of fair allocation in economies with indivisible goods our main objective is to identify appealing subsolutions of the no envy solution we formulate desirable properties of solutions and look for solutions satisfying them given an allocation chosen by a solution for some economy and given a subgroup of the agents consider the problem of fairly distributing among its members the resources that this group has collectively received the solution is consistent if it recommends that the same bundle be attributed to each of these agents as initially we show that there is no proper subsolution of the no envy solution that satisfies consistency however many subsolutions satisfy bilateral consistency or the converse of consistency but again there is no proper subsolution satisfying these two properties together

multi item auctions a collection of items is to be distributed among several bidders and each bidder is to receive at most one item assuming that the bidders place some monetary value on each of the items it has been shown that there is a unique vector of equilibrium prices that is optimal in a suitable sense for the bidders in this paper we describe two dynamic auction mechanisms one achieves this equilibrium and the other approximates it to any desired degree of accuracy

a theory of competition among pressure groups for political influence this paper presents a theory of competition among pressure groups for political influence political equilibrium depends on the efficiency of each group in producing pressure the effect of additional pressure on their influence the number of persons in different groups and the deadweight cost of taxes and subsidies an increase in deadweight costs discourages pressure by subsidized groups and encourages pressure by taxpayers this analysis unifies the view that governments correct market failures with the view that they favor the politically powerful both are produced by the competition for political favors

restructuring of firms in transition ownership institutions and openness to trade we develop a theoretical framework for defensive and strategic restructuring and provide estimates of restructuring in privatized firms in an advanced transition economy slovenia our rich data point to both types of restructuring as well credit rationing and bargaining with respect to investment privatized firms display profit maximizing behavior and a firm s export orientation and institutional features such as insider vs outsider privatization employee ownership and employee control do not affect the firm s employment and investment behavior the results suggest that a major exposure to world competition induces similar economic behavior in firms with different structural and institutional characteristics

asset specificity and the political behavior of firms lobbying for subsidies in norway previous research into endogenous trade policy has described extensively the political incentives of firms with specific assets but no studies have shown directly that firms behave as predicted we adopt insights from transaction costs economics to develop measures of asset specificity and to investigate how variation in these measures affects the political behavior of firms in particular we examine the lobbying choices of norwegian firms in the 1980s given available subsidy funds from norway s oil boom and some government decisions in the 1970s firms with more specific assets faced potentially greater losses from adjusting to new activities in the face of competitive pressures and thus had greater incentives to lobby for subsidies to protect themselves joint contacting of parliament and government on behalf of firm interests by representatives of both management and labor should be particularly likely where firms had specific assets data analysis shows that asset specificity as indicated by r d intensity and job immobility predicts joint contacting independently of plausible alternative explanatory variables like firm size and export orientation

audience features and the strategic timing of trade disputes if international institutions are such potent alarm mechanisms that mobilize procompliance domestic audiences as many existing theories argue why do countries wait so long before sounding the alarm world trade organization wto members often wait months or even years before objecting to their trading partners wto illegal barriers to turn a phrase trade cooperation delayed is trade cooperation denied so why wait to explain this variation i develop a theory of institutional alarm mechanisms in which 1 the preferences and strength of the audience hearing the alarm vary and 2 the decision to sound the alarm is strategic sounding the alarm is most valuable when strong audiences in the defendant country support compliance i test this prediction using competing risks models analyzing the timing of wto disputes against us tariff barriers consistent with the theory disputes are more likely during election years when macroeconomic indicators suggest broader support for free trade

the determinants of industry political activity 1978 1986 c ampaign contributions made by corporate political action committees pacs are increasingly important and controversial in u s elections influence purchasing is often alleged by pundits and campaign finance reform is continually debated in congress in the academy social scientists have analyzed the allocation of interest group monies and have looked for possible impacts on legislation few however have tried to explain the total contributions of economic interest groups we shall analyze variations in contributions across industries and over time with an empirical model based on organizationally constrained profit maximizing behavior we assume that corporate pac contributions in an industry are raised to enhance industry profits subject to the constraints of organization costs and freeriding incentives our empirical work covers 124 industries over five election cycles from 1978 through 1986 both the costs and benefits of political activity vary across industries we argue that the benefits of political action are determined by direct contact with the government as a regulator or purchaser of industry output by government s ability to ameliorate adverse market conditions and by the industry s ability to solve collective action problems without government assistance the costs of industry political action arise mainly from collective action problems because effective political activity often requires concerted action by the constituent firms in each industry we also make a methodological contribution previous studies use statistical techniques that suffer from sample selectivity bias or else force the probability of acting politically to be explained by the same set of coefficients as is the amount of action taken we explain and employ a technique that accounts for both problems the results are consistent with the theses that industries follow investment oriented goals in deciding the amount of political action to undertake and that collective action problems are important constraints on industry political activity we can explain between 60 and 80 of the variation in contributions in our sample first we review existing work on corporate political activity particularly papers examining patterns of aggregate pac spending by industry then we present an organization cost constrained industryprofit maximizing model based on a comparison between an idealized zero organization cost industry and the more realistic case where organizing collective action is difficult the independent variables used in the analysis are also discussed and defined next we discuss the dependent variable and total industry contributions and explain our statistical method then the results are presented followed by a discussion of industry structure and political activity to make clear how our results can explain different contribution patterns we give examples using five actual industries

between free trade and protectionism strategic trade policy and a theory of corporate trade demands conventional theories of the political economy of trade argue that industries in import competing businesses favor protectionism while multinational firms and export dependent corporations advocate unconditional free trade however many multinational industries have recently advocated strategic trade policies that is they are willing to support free trade at home only if foreign markets are opened or foreign governments reduce subsidies to their firms if demands for strategic trade policy were adopted by the united states they could represent a threat to the general agreement on tariffs and trade gatt and the multilateral trading system this article seeks to explain the emergence of these new corporate trade demands and thereby broaden theories of the political economy of trade the article begins with the widely supported position that multinational and export oriented firms prefer unconditional free trade building on concepts from theories of industrial organization and international trade the article then hypothesizes that rising economies of scale and steep learning curves will necessitate that these firms have access to global markets via exports if growing dependence on world markets is combined with foreign government subsidies or protection the trade preferences of firms will shift from unconditional free trade to demands that openness at home be contingent on openness overseas the manner in which firm demands then get translated into industry demands will vary with the industry s structure if the industry consists of firms with symmetric strategies it will seek strategic trade policy but if the industry is highly segmented it will turn toward protectionism the article concludes with a preliminary test of these hypotheses in four brief studies of the politics of trade in the semiconductor commercial aircraft telecommunications equipment and machine tool industries

the logic of private and collective action since mancur olson s logic of collective action 1965 it is impossible for political scientists to conceive of political participation without reference to his powerful argument linking numbers of participants public goods and participatory outcomes what is puzzling is the poor empirical support for this argument in the domain where it should work best namely explaining business political activity olson thought his arguments principally applicable to economic groups and for the empirical development of his arguments olson drew heavily on business interests the most active segment of the interest group community we explore these arguments with business political activities data by examining the statistical performance of various measures of market structure in determining business political activity and find little empirical support we do offer an alternative basis for business behavior lodged in both private and collective goods that preserves business rationality and also helps explain not only the amount of business political participation but the modes of business participation w hen we think about the paradox of participation one of the formative puzzles of modern political science we tend to think first of voting and citizen participation we think of the large numbers involved the small probability that an individual vote will be decisive and we conclude that no one will vote the puzzle then becomes why so many people do vote to find a solution we tend to plead some sort of diminished rationality such as the costs of voting are too low even to consider carefully or that they are outweighed by the norm of civic duty in this article we examine the paradox of participation in the principal context that olson 1965 considered it for the empirical development of his arguments olson drew heavily on business interests he observed that business was the most active segment of the interest group community and noted that for large numbers of participants seeking pubic goods the dominant choice is to do nothing he argued that business activity derived from multiple markets and related industries segmenting the larger business community into small groups in an oligopolistic market it is rational for the individual firm to participate in association with others or on its own a

theoretical foundations of emerging economy business research in probing theoretically into central and eastern europe transactions resources and institutions we outlined the contributions of research in central and eastern europe cee to theoretical debates in business research in this retrospective we reflect upon the evolution of the field over the past decade with the fading impact of cee s distinct shared history we suggest that cee best be analyzed as emerging economies rather than as a distinct geographic entity emerging economy business research is converging on common themes and shared theoretical ideas while identifying critical variations that constrain generalizations among and beyond emerging economies this research thus highlights the need to develop a better understanding of the boundary conditions of scholarly theories of business knowledge over the past decade the institution based view has emerged from distinct intellectual traditions in institutional economics organizational theory and the analysis of business government bargaining research in these converging lines of theorizing places contextual variations at the center of explanations of business phenomena around the world we suggest that the institution based view is evolving toward a paradigm and offer suggestions on how to advance this research agenda further in particular by exploring how firms engage with different sets of potentially conflicting institutions at multiple levels and locations

fair allocation of indivisible goods and criteria of justice a set of n objects and an amount m of money is to be distributed among m people example the objects are tasks and the money is compensation from a fixed budget an elementary argument via constrained optimization shows that for m sufficiently large the set of efficient envy free allocations is nonempty and has a nice structure in particular various criteria of justice lead to unique best fair allocations that are well behaved with respect to changes of m this is in sharp contrast to the usual fair division theory with divisible goods

making sense in hypercompetitive environments a cognitive explanation for the persistence of high velocity competition this paper explores the cognitive aspects underlying industries in hypercompetitive environments hypercompetition represents a state of competition with rapidly escalating levels of competition and reduced periods of competitive advantage for firms in hypercompetitive industries member firms act boldly and aggressively to create a state of competitive disequilibrium in this paper we explore the particular conditions that managers encounter in making sense of hypercompetitive industries and argue that the nature of these conditions is such that conventional sensemaking frameworks will not work we then describe the adaptive sensemaking practices established in the literature for dealing with temporary turbulence and suggest that in hypercompetition those processes continue indefinitely we argue that these processes can become institutionalized as standard operating procedures within firms and as shared recipes within industries which in turn perpetuates hyperturbulent conditions