some design lessons from market based greenhouse gas regulation in the restructured australian electricity industry abstract there is growing worldwide interest in the use of market based policy instruments for climate change regulation in the electricity sector these mechanisms would seem to offer some efficiency and flexibility advantages over more traditional regulatory approaches while being highly compatible with competitive market based electricity industries australia has been an early and enthusiastic adopter of both electricity industry restructuring and market based environmental instruments this paper first outlines some of these recent policy developments in particular we describe the objectives design and outcomes to date of electricity industry restructuring the mandatory renewable energy target the nsw greenhouse benchmarks the queensland 13 gas scheme and government accredited green power from this we draw some key design lessons for such market based instruments these include the perils of abstraction in scheme design the vital importance of setting appropriate baselines in baseline and credit schemes the possibility that such measures may interact in ways that reduce their environmental effectiveness market for lemon risks with tradable instruments that have measurement verification or additionality difficulties and the challenges of creating transparent liquid markets for these mechanisms the mixed performance of these australian schemes to date illustrates the need for great care in designing such market based approaches

a step toward understanding wind power development policy barriers in advanced economies abstract a widely accepted premise regarding wind power development policy is that implementation of economic policy instruments which are designed to close the cost gap between wind power and entrenched fossil fuel power generation technologies will significantly catalyze enhanced levels of wind power development activity this paper contests this premise by arguing that non economic barriers to wind power development have the capacity to significantly inhibit wind power development in industrialized nations despite the implementation of economic policy instruments forces which deter wind power development in four economically advanced economies that exhibit phlegmatic progress in wind power development australia canada japan and taiwan are identified and amalgamated into a step framework describing social technical economic and political forces that inhibit wind power development the conclusions of this analysis are twofold first failure to mitigate these step forces may undermine the efficacy of any given economic policy instrument that aims to close the cost gap between wind power and entrenched generation technologies second attempts to mitigate these impediments might represent a way to achieve better policy results with less government financial commitment

the contingent governance of teams analysis of institutional complementarity the first purpose of this paper is to design a model of governance structure called the contingent governance which can control the free riding problem in teams in the second best manner the second is to show by a new method of comparative static analysis that the effectiveness of the contingent governance may be enhanced by complementary institutional arrangements of the imperfect labor market and bank centered financial system the paper discusses the implications of such institutional complementarity for the dynamic change of the japanese main bank system and financial system design of transitional economies copyright 1994 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

labour market deregulation flexibility and innovation labour flexibility is often portrayed as important to competitive success using evidence from an original survey of uk firms this paper investigates the relationships between firms use of on the one hand various flexible work practices human resource management techniques and industrial relations systems and on the other hand the innovative activities of those firms our results suggest that the sort of low road labour flexibility practices encouraged by labour market deregulation short term and temporary contracts a lack of employer commitment to job security low levels of training and so on are negatively correlated with innovation

impact of information technology capital on firm scope and performance the role of asset characteristics this research draws on transaction cost and resource based theory to examine how information technology it capital moderates the relationship between different types of assets and firm scope both vertical integration and diversification the analysis suggests that it capital enables firms with narrowly valuable assets to be less vertically integrated and less diversified and enables firms with broadly valuable assets to be more vertically integrated and more diversified the moderating influence of it capital on the relationship between different types of assets and firms vertical and product market scope is consistent with transaction cost as well as resource based traditions abstract from author

deposit insurance reform what are the issues and what needs to be fixed abstract the current problems in the commercial banking industry have led to widespread calls for reform of the deposit insurance contract on the grounds that it promotes moral hazard we review the empirical evidence for the significance of moral hazard as an important cause of the present crisis we then evaluate various reform proposals grouped into two broad classes proposals that seek to impose greater discipline on bank stockholders and proposals to increase the disciplinary role of bank debtholders finally we identify some issues that have received inadequate attention in the literature on bank regulation

a comparative analysis of the costs of onshore wind energy is there a case for community specific policy support abstract there is growing policy interest in increasing the share of community owned renewable energy generation this study explores why and how the costs of community owned projects differ from commercially owned projects by examining the case of onshore wind in the uk based on cross sectoral literature on the challenges of community ownership cost differences are attributed to six facets of an organisation or project internal processes internal knowledge and skills perceived local legitimacy of the project perceived external legitimacy of the organisation investor motivation and expectations and finally project scale these facets impact not only development costs but also project development times and the probability that projects pass certain critical stages in the development process using survey based and secondary cost data on community and commercial projects in the uk a model is developed to show the overall impact of cost time and risk differences on the value of a hypothetical 500 kw onshore wind project the results show that the main factors accounting for differences are higher pre planning costs and additional risks born by community projects and suggest that policy interventions may be required to place community owned projects on a level playing field with commercial projects

cultural industries in international business research progress and prospect cultural industries systems of organizations that produce and distribute cultural goods with substantive symbolic aesthetic or artistic value represent an important exciting and complex context that receives growing scholarly attention as the first review of management research on cultural industries this paper aims to provide a systematic synthesis of current research summarizing distinctive characteristics of cultural industries and highlighting research gaps we also illustrate how the unique nature dynamics and evolution of cultural industries provide opportunities to broaden international business theories in four research themes i e internationalization strategy cross border innovation social inclusion in the global economy and emerging market research

risk shifting incentives of depository institutions a new perspective on federal deposit insurance reform abstract we characterize the risk shifting incentives of a depository institution as arising fundamentally from the existence of limited liability and the associated convex payoff to equity holders this risk incentive feature is unchanged by deposits being insured and hence excessive risk taking by depository institutions is not solely attributable to the flat rate insurance premium consequently the incentive problem cannot be resolved through a risk based insurance premium contrary to the prevailing view we propose a solution that eliminates risk shifting through an optimal tax structure and specify a corresponding insurance premium that is revenue neutral from the social planner s regulator s standpoint the solution is derived in the context of a social objective function that trades off the benefits of liquidity services by banks and the unique informational role of bank loans with the costs of investment distortions engendered by risk shifting

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

community perspectives of wind energy in australia the application of a justice and community fairness framework to increase social acceptance decisions concerning the siting of infrastructure developments or the use of natural resources have the potential to damage a community s social well being if the outcomes are perceived to be unfair justice is accepted as central to the well functioning of society with fairness being an expectation in day to day interactions outcomes that are perceived to be unfair can result in protests damaged relationships and divided communities particularly when decisions are made which benefit some sections of the community at the perceived expense of others through empirical research using a wind farm pilot study community perceptions of a community consultation process are explored using procedural justice principles to evaluate fairness findings from the pilot study indicate that perceptions of fairness do influence how people perceive the legitimacy of the outcome and that a fairer process will increase acceptance of the outcome a key research finding was that different sections of a community are likely to be influenced by different aspects of justice namely by outcome fairness outcome favourability and process fairness based on this finding a community fairness framework was developed which has potential application in community consultation to increase social acceptance of the outcome

resource partitioning the founding of specialist firms and innovation the american feature film industry 1912 1929 past research has established that large bureaucratic firms are less innovative than other firms this reduced innovativeness is likely to be exacerbated when large firms engage in market control in cultural industries the effects can be especially pernicious resulting in the failure to provide audiences with artistic quality or product diversity we investigate the population dynamics of one cultural industry the early american feature film industry specifically we examine the hypothesis that concentration among large generalist firms will be associated with higher rates of foundings of specialist producers and specialist distributors we also investigate the question of whether these specialists are more innovative specifically we examine the hypothesis that specialists were more active than were generalists in the creation of new film genres in the early years of the american film industry we find that increased concentration among generalists had a positive effect on foundings of specialist producers and specialist distributors and that the specialists were more active in the creation of new film genres implications of these findings for future research both on cultural industries and on the population dynamics of the founding of specialist firms are discussed

firm specific assets multinationality and financial performance a meta analytic review and theoretical integration through a meta analysis of 120 independent samples reported in 111 studies we test the predictions of internalization theory in the context of the multinationality performance relationship findin

do capital adequacy requirements reduce risks in banking abstract in a dynamic framework it is shown that capital adequacy rules may increase a bank s riskiness in addition to the standard negative effect of rents on risk attitudes of banks a further intertemporal effect has to be considered the intuition behind the result is that under binding capital requirements an additional unit of equity tomorrow is more valuable to a bank if raising equity is excessively costly the only possibility to increase equity tomorrow is to increase risk today

the inquiry into electricity supply in new south wales in may 2007 the premier of new south wales nsw announced the establishment of an inquiry into electricity supply in that state to be undertaken by the author of this paper fundamental to the inquiry was the perceived need for additional baseload generating capacity the identification of the available technologies carbon constraints and the policy options that would encourage the private sector to undertake the required investments although nsw is part of the competitive national electricity market state owned generators dominate baseload supply in addition the state operates three electricity retailing businesses has a monopoly on transmission and distribution and provides price stability for nsw residential consumers through the electricity tariff equalisation fund overall therefore the state dominates the industry and not surprisingly potential private investors are sceptical that its market roles may be based upon criteria other than the purely commercial the inquiry s report which was publicly released in september 2007 recommended sale of all state assets in both electricity generation and retail this paper provides a rationale for that recommendation

institutional factors influencing strategic decision making in energy policy a case study of wind energy in france and quebec canada abstract this article studies the different institutional factors that influence a strategic wind energy decision making process through a comparative transnational study of quebec canada and france research confirms that political choices are dynamic and vary with a change in the wind energy context the balance of power between pressure groups supranational influences energy evaluation approaches and social acceptance until the 90 s an initially unfavorable national energy context combined with a neocorporatist culture as defined by szarka 2004 1 limited the place of wind energy in both jurisdictions in the 2000 s a political window opened when the private sector penetrated the market with the deregulation of the electricity sector exogenous pressure from the european union in france endogenous pressure from social actions in quebec and a more favorable energy context in both cases however this political window was short lived due to social acceptance issues in quebec political will was stronger until 2013 now the social controversy surrounding wind energy has shifted from the local to the national level projects are better accepted locally because of local financial involvement but an anticipated electricity surplus questions the relevance of new energy projects in france political support depends on the government in power between 2005 and 2013 the reduction in annual wind power installations from 1246 mw to 621 mw was due to the major influence of the anti wind lobby on a right wing government after 2013 the left wing government s arrival coincided with a phasing out of several regulatory and financial uncertainties today both jurisdictions are at a crossroads and the future energy mix will depend on the relative influence of the institutional components identified in our opinion key solutions to more sustainable political choices are conditioned by an improvement in the way projects and policies plans and programs are assessed

the effect of capital structure on a firm s liquidation decision abstract a firm s liquidation can impose costs on its customers workers and suppliers an agency relationship between these individuals and the firm exists in that the liquidation decision controlled by the firm as the agent affects other individuals the customers workers and suppliers as principals the analysis in this paper suggests that capital structure can control the incentive conflict problem of this relationship by serving as a pre positioning or bonding mechanism appropriate selection of capital structure assures that incentives are aligned so that the firm implements the ex ante value maximizing liquidation policy

accounting for creativity in the european union a multi level analysis of individual competence labour market structure and systems of education and training some workplaces offer employees opportunities to creatively use their own ideas while engaged in learning and problem solving activity without much interference from managers and bosses in this paper we analyse the preconditions for creative work using multilevel logistic modelling we examine what characteristics of the individual the organisation of work and the national institutional context promote creative work at the national level we focus on the effects of national education and training systems and labour markets the analysis demonstrates not surprisingly that individuals with higher education and a certain amount of work experience are more likely to have creative jobs it also shows that creative jobs are more likely at workplaces where managers support employees and where work is organised to promote knowledge diversity in terms of international differences we find that creative work tends to be more developed in scandinavian countries than in the south and east of europe interestingly we find significant positive relations between the likelihood of creativity at work on the one hand and the development of broad competence based systems of education and labour market flexicurity on the other this implies tha tp olicy attempts to attract the creative class as it has been defined by richard florida through promoting diversity should at the national level be combined with the institutional reform of europe s education systems and labour markets such policies may extend the category of creative employees to include significant parts of what florida defines as the working class

what exactly are technological regimes intra industry heterogeneity in the organization of innovation activities this empirical study analyzes the patterns of innovation within and across industries using firm level survey data from finland and denmark the theoretical starting point is evolutionary theory with its premise that firms in different technological regimes pursue different paths to innovation similar modes of behaviour are found in the two datasets and they closely correspond to those found in earlier studies contrary to prevailing assumptions however the results show that industries are not at all uniform in terms of how firms innovate in almost all four or five digit nace industries three or more different modes of innovation can be identified this suggests that firms strategic differentiation or local search activities overcome pressures in the technological environment towards homogenous behaviour at least in the short term

the power of integrality linkages between product architecture innovation and industry structure abstract a substantial literature stream suggests that many products are becoming more modular over time and that this development is often associated with a change in industry structure towards higher degrees of specialization these developments can have strong implications for an industry s competition as the history of the pc industry illustrates to add to our understanding of the linkages between product architecture innovation and industry structure we develop detailed product architecture measurements based on a previously proposed method fixson s k 2005 product architecture assessment a tool to link product process and supply chain design decisions journal of operations management 23 3 4 345 369 and study an unusual case in which a firm through decreasing its product modularity turned its formerly competitive industry into a near monopoly using this case study we explore how existing theories on modularity explain the observed phenomenon and show that most consider technological change in rather long term dimensions and tend to focus on efficiency related arguments to explain the resulting forces on competition we add three critical aspects to the theory that connects technological change and industry dynamics first we suggest integrating as a new design operator to explain product architecture genesis second we argue that a finer grained analysis of the product architecture shows the existence of multiple linkages between product architecture and industry structure and that these different linkages help explain the observed intra industry heterogeneity across firms third we propose that the firm boundary choice can also be a pre condition of the origin of architectural innovation not only an outcome of efficiency considerations

variable rate deposit insurance a re examination abstract this paper investigates the impact of variable rate deposit insurance on the financial and real sectors of the economy and its role as an absorber of bankruptcy risk within these sectors a variable rate system raises the cost of funds to the real sector and increases probability of bankruptcy of the borrowing firms when such bankruptcies occur society experiences a dead weight loss we argue that appropriate deposit insurance pricing must weigh the social costs connected with both financial firm failure and real sector bankruptcy

schumpeterian patterns of innovation using patent data for four countries germany france united kingdom and italy for the period 1968 1986 the authors find that the patterns of innovative activities differ systematically across technological classes while remarkable similarities emerge across countries in the patterns of innovative activities for each technological class this result strongly suggests that technological imperatives and technology specific factors closely linked to technological regimes play a major role in determining the patterns of innovative activities across countries schumpeter proposed two major patterns of innovative activities the first one labelled by nelson and winter 1982 and kamien and schwartz 1982 as schumpeter mark i is proposed in the theory of economic development 1934 in this work schumpeter examined the typical european industrial structure of the late nineteenth century characterised by many small firms according to this view the pattern of innovative activity is characterised by technological ease of entry in an industry and by a major role played by new firms in innovative activities new entrepreneurs come in an industry with new ideas new products or new processes launch new enterprises which challenge established firms and thus continuously disrupt the current ways of production organisation and distribution and wipe out the quasi rents associated with previous innovations the second one labelled schumpeter mark ii is proposed in capitalism socialism and democracy 1942 in this work inspired by the features of the american industry of the first half of the twentieth century schumpeter discussed the relevance of the industrial r d laboratory for technological innovation and the key role of large firms according to this view the pattern of innovative activities is characterised by the prevalence of large established firms and by relevant barriers to entry for new innovators large firms have institutionalised the innovation process with the creation of r d laboratories filled with researchers technicians and engineers with their accumulated stock of knowledge in specific technological areas their advanced competence in large scale r d projects production and distribution and their relevant financial resources they create barriers to entry to new entrepreneurs and small firms

risk in banking and capital regulation this paper investigates the role of bank capital regulation in risk control it is known that banks choose portfolios of higher risk because of inefficiently priced deposit insurance bank capital regulation is a way to redress this bias toward risk utilizing the mean variance model the following results are shown a the use of simple capital ratios in regulation is an ineffective means to bound the insolvency risk of banks b as a solution to problems of the capital ratio regulation the theoretically correct risk weights under the risk based capital plan are explicitly derived and c the theoretically correct risk weights are restrictions on asset composition which alters the optimal portfolio choice of banking firms the recent increase in bank failures especially after the 1980 and 1982 deregulatory acts has again ignited a controversy over the risk portfolio of the banking industry given the importance of this sector there has been increased scrutiny of the industry s motives for risk taking and possible regulatory changes to improve its stability these investigations have centered around two rather complementary areas the first of these is the role of deposit insurance and how its current pricing procedure encourages risk taking and justifies current bank regulations the works of buser chen and kane 4 kane 9 and benston et al 2 have made substantive contributions the authors demonstrates the way in which our current fixed rate insurance system rewards risk taking by the firm and insulates it through deposit insurance from the market discipline that needs to exist to ensure proper risk evaluation this realization has led these authors to propose a series of regulatory changes to encourage proper portfolio choice within the industry these include a shift to market value accounting risk based deposit insurance premiums and additional capital regulation the last of these serves as a method of coinsurance whereby higher capital levels require the bank to absorb greater losses in the event of failure and encourage additional prudence in management in essense it is one method of risk reduction that may offset the risk preference imposed on the industry due to the inappropriate insurance pricing because the amount of capital influences the probability of bank insolvency and thus the soundness of the entire banking system the regulators ceteris paribus prefer more capital to

federal deposit insurance regulatory policy and optimal bank capital this paper seeks to explain the combination of explicit and implicit pricing for deposit insurance employed by the fdic essentially the fdic sells two products insurance and regulation to span the product space it must and does set two prices we argue that the need to establish regulatory disincentives to bank risk taking is the heart of the controversy over the adequacy of bank capital and that the ability to close risky banks before exhausting their charter value i e the value of their right to continue in business stands at the center of these disincentives and in front of the fdic s insurance reserves just as a book shouldn t be judged by its cover a government agency shouldn t be judged by the words behind its initials with the fdic federal deposit insurance corporation the agency s name describes only part of its formal operations the fdic is quasi governmental has a regional structure and sells deposit insurance however the initials fail to convey the fdic s critical place in the governmental regulatory structure as the sole federal overseer of the approximately 8900 state chartered commercial banks that have chosen not to belong the federal reserve system reflecting the federal reserve s membership problem the number of these banks is growing year by year besides selling deposit insurance at bargain explicit rates the fdic performs four regulatory functions 1 entry regulation it passes on new banks applications for deposit insurance and on branch and merger proposals as well thereby protecting the value of existing bank charters 2 examination two thirds of fdic employees are concerned with inspecting bank records and supervising managerial activity 3 regulation of deposit rates and conditions for withdrawal by tradition fdic policies on these matters conform entirely with regulations applicable to federal reserve member banks and 4 disposition of failed banks when an insured bank fails the fdic usually chooses not to liquidate it 2

fixed versus variable rate loans this paper discusses the nature of fixed and variable loan contracts and derives the conditions which determine the optimal quantity of each the results indicate that the payoff functions are quite different and dependent upon the project financed the appropriate conditions for the allocation of loan terms to a set of borrowers are then developed finally the analysis derives the optimal portfolio frontier and risk return trade off for the banking firm here it is demonstrated that the solution is unlikely to be at a point of zero interest rate risk

lessons learned in france and quebec regarding financial and legal mechanisms to develop renewable energy a hybrid model as an acceptable solution for onshore wind abstract this article shows that the unfavorable context of emergence as well as neo corporatism limited the weight of wind energy in france and quebec and delayed the project development and the wind industry as a whole indeed the level of political will to wind energy development in both jurisdictions is fluctuating and characterized by a lack of continuity in policy or regulatory instruments the efficiency of the pricing mechanisms depends on its political design while the french feed in tariff is inefficient in terms of installed capacity and is deemed too expensive by opponents the first two calls for tenders in quebec fare quite well on that front however they are perceived as unacceptable due to the multinational companies involved and the implantation of large scale wind farms in inhabited areas the third community call for tender while generally better accepted locally is poorly regarded among the cooperative movement and at the national level because of the competition with the municipal sector and higher costs to society in both cases a hybrid pricing model would achieve a better balance between costs to society and local development thus promoting social acceptance through a greater diversity in ownership types and wind farms size

labour market regulation industrial relations and technological regimes a tale of comparative advantage in this paper we present comparative evidence from oecd countries concerning the impact of labour market institutions and regulations on technological specialization the interplay between the degree of labour market flexibility the system of industrial relations and the knowledge base of different industries determines the viability of different human resource strategies thereby shaping the patterns of comparative advantage our empirical results show that countries with coordinated industrial relations systems and strict employment protection tend to specialize in industries with a cumulative knowledge base we argue that two mechanisms explain these patterns the larger the scope for resorting to internal labour markets the lower the adjustment costs imposed by labour market regulation furthermore employment protection and coordinated industrial relations regimes by aligning workers and firms bjectives encourage firm sponsored training as well as the accumulation of firm specific competencies allowing firms to fully exploit the potential of the internal labour market copyright 2002 oxford university press

modeling the banking firm a survey this paper reports on the status of the literature on micro bank modeling and assesses our understanding of the banking firm s optimal behavior this is no mean task for much has been written on banking broadly defined over the past couple of decades the review is developed in pieces each major subproblem is outlined and the analysis used to deal with the issue explicated this is not the best way to summarize the development of a field it should be immediately recognized one would prefer to have a smooth continuum of development moving the frontier of knowledge evenly through time and across subareas yet this is rarely the way a field develops more likely individual questions attract attention and are the subjects of a substantial number of contributions after a time the field moves on to the new area of interest the banking field is no exception before embarking upon the review however a couple of lines should be devoted to previous attempts there have been essentially three first pyle 1972 analyzes the uncertainty portfolio models at a time when little existed in the literature and hence one finds the review a bit vague and sketchy baltensperger s contributions 1978 1980 are the next serious and rather extensive reviews the quality of these

balancing the tensions between rationalization and creativity in the video games industry this paper investigates the forces that influence creativity in the video games industry we adopt a qualitative approach to guide the development of grounded theory across multiple levels of analysis including the industry consisting of multiple actors organizational and individual creator levels our study shows that business and production interests currently drive the rationalization of video game production there is a maturing trend with product designs becoming well established as genres and consumers and publishers desiring incrementally innovative games this leads publishers to focus on acquiring intellectual property and publishers and studios alike to make incrementally innovative sequels the increasing complexity of products leads to further rationalization in their development however the need to satisfy consumers continually evolving tastes and game developers inclinations to be creative also creates tensions with these rational forces different actors balance these tensions differently studios may seek to balance these by shifting between more and less innovative products by creating original intellectual property to increase their bargaining power with publishers and by iterating and repositioning products during development to adapt them to the market publishers may enhance their portfolio by hiring highly creative designers into their stable new products are created through combinative creativity that is the recombination of existing ideas from different sources into new products the connection of combinative mechanisms with the balancing behavior at the firm level provides a means for understanding the evolution of innovative products and therefore industries

mobility and innovation a cross country comparison in the video games industry open labour markets are often seen as a precondition for innovation particularly for new industries however this view ignores two core findings of the economic systems literature first that mobility patterns are institutional microsystems that need to be complementary to other institutions in the labour market and second that new industries may be characterised by incremental and complex innovation based on these considerations we ask how mobility affects innovation in the video games industry in the us and japan we find that inter firm mobility is beneficial for innovation in the us but has negative effects in japan we further find that inter functional mobility is beneficial for innovation in both countries our analysis is based on career histories from the video games industry in the us and japan we present an empirical study based on the game development of 815 video games and the careers of 28 426 video game developers who were involved in the development of games released between 1999 and 2009

little innovation many jobs an econometric analysis of the italian labour productivity crisis during the past twenty years italy has realized changes in labour legislation leading to a decentralization of wage bargaining and increased flexibility in labour relations both these factors have helped to curb wage growth and to enhance employment growth but have also led to a crisis in italian labour productivity growth our estimates among 3 000 firms show that firms with high shares of flexible workers a high labour turnover and lower costs of labour relative to capital experienced significantly lower rates of labour productivity growth our findings raise doubts about the mainstream call for flexibilisation of european labour markets we argue hat the italian shift towards a low productive and labour intensive growth path is problematic gainst the background of an ageing population

a framework for assessing credit risk in depository institutions toward regulatory reform abstract this paper develops and illustrates a new method for evaluating the credit risk borne by depository institutions that may prove to be an important element in a regulatory mechanism sensitive to risk in our framework depository institutions are forced to bear the costs of their risk exposure and hence to internalize this cost when extending loans using various loan portfolios and alternative macroeconomic scenarios we present numerical calculations demonstrating the ability of our framework to capture variations in risk exposure and highlighting the significance of portfolio concentrations these calculations are based on an important new source of information that permits an econometric analysis of loan losses by industry

the regulation of labor author s botero juan djankov simeon la porta rafael lopez de silanes florencio shleifer andrei abstract we investigate the regulation of labor markets through employment collective relations and social security laws in 85 countries we find that the political power of the left is associated with more stringent labor regulations and more generous social security systems and that socialist french and scandinavian legal origin countries have sharply higher levels of labor regulation than do common law countries however the effects of legal origins are larger and explain more of the variation in regulations than those of politics heavier regulation of labor is associated with lower labor force participation and higher unemployment especially of the young these results are most naturally consistent with legal theories according to which countries have pervasive regulaory styles inherited from the transplantation of legal systems

the varieties of capitalism and hybrid success denmark in the global economy the varieties of capitalism literature maintains that advanced capitalist countries whose institutions best fit either the liberal or coordinated market economy types will perform better than countries whose institutions are mixed this is because hybrids are less likely to yield functionally beneficial institutional complementarities the authors challenge this assertion denmark has performed as well as many purer cases during the 1990s and denmark has recently developed a more hybrid form than is generally recognized by a increasing the exposure of actors to market forces and b decentralizing collective learning and decision making the institutional complementarities associated with such hybridization have contributed to its success however these complementarities are based on institutional heterogeneity rather than homogeneity this is demonstrated by analyses of three cases danish labor markets vocational training and industrial policy the implication of the authors argument is that the

deposit insurance pricing and social welfare abstract recent literature has established that financial disruption has real costs which justify government intervention in the financial sector one form of government intervention is deposit insurance in this paper we determine the optimal pricing and subsidy of deposit insurance in a social welfare context the main conclusion is that optimal deposit insurance need not be actuarially fair in an economy with a real and a financial sector we consider the effects of taxation and social political weights of the sectors we analyze two policy tools government supervision and deposit insurance pricing

short term projects and emergent careers evidence from hollywood the hollywood film industry is considered as a system of recurrent ties among the various major participants who usually work under short term contracts for single films this form of project based organization in seen as a response to uncertainty and risk in the film industry the paper examines the ways in which independent contractors producers directors cinematographers and actors organize and operate to reduce uncertainty and risk and to increase profits the analysis of data from 2 430 films made in the period 1965 80 establishes patterns of recurrent ties among participants who are at comparable levels of cumulative productivity with respect to earnings oscars oscar nominations and number of previous films the paper also considers the degree to which film earnings are influenced by the past productivity of the major participants

the organizational choice between evolutionary and revolutionary capability regimes theory and evidence from european air transport resource and capability based models of firm strategy gain in analytical power by incorporating some of the organizational trade offs that firms face in choosing between alternative capability building strategies based on the well documented trade off between flexibility and commitment inherent in social systems this paper argues that firms must choose between evolutionary and revolutionary capability regimes empirical evidence drawn from the race of european airlines to develop critical revenue management capabilities is cited to illustrate the theory and practical relevance of capability regimes copyright 2000 by oxford university press

structural reforms in europe and the in coherence of institutions the aim of this paper is to analyse the consequences of some structural reforms on the institutional coherence of oecd countries particularly in continental europe and on their economic performance particularly as regards employment because institutions in developed political economies are interrelated through a complex network of complementarities institutional change has consequences beyond the area concerned in a reform this also implies that there are complementarity effects in reforms themselves a challenge of reform programmes is therefore to achieve a new type of complementarity between reformed institutions the paper presents empirical evidence questioning the compatibility of the ongoing structural reforms in product and labour markets with the existing institutional structures in some oecd countries the coherence of the flexicurity strategy i e a combination of labour market flexibility and a generous welfare state is also questioned from the point of view of both economic efficiency and political economy

the pbgc s flat fee schedule moral hazard and promised pension benefits abstract the pension benefit guarantee corporation pbgc initially insured private pension benefits in exchange for a premium that was not risk sensitive this paper derives conditions under which a moral hazard problem caused promised pension benefits to increase the hypotheses are tested using data on individual pension contracts from the pre and post pbgc periods

market rate versus fixed rate demand deposits abstract in an economy with uninsured banks market rate deposits are shown to provide services identical to fixed rate deposits without risking banking panics as long as there is not both aggregate uncertainty about liquidity demands and asymmetric information about bank asset quality however if both factors are present then the preferred deposit form depends on the riskiness of bank assets and information revealed through market prices the analysis may explain the evolution of fixed rate deposits before the introduction of deposit insurance moreover it provides currently relevant insights regarding deposit contract forms and deposit insurance

dynamics in innovation systems evidence from japan s game software industry in contrast to the us and recently europe japan appears to be unsuccessful in establishing new industries an oft cited example is japan s practical invisibility in the global business software sector literature has ascribed japan s weakness or conversely america s strength to the specific institutional settings and competences of actors within the respective national innovation system it has additionally been argued that unlike the american innovation system with its proven ability to give birth to new industries the inherent path dependency of the japanese innovation system makes innovation and establishment of new industries quite difficult however there are two notable weaknesses underlying current propositions postulating that only certain innovation systems enable the creation of new industries first they mistakenly confound context specific with general empirical observations and second they grossly underestimate or altogether fail to examine the dynamics within innovation systems this paper will show that it is precisely the dynamics within innovation systems dynamics founded on the concept of path plasticity which have enabled japan to charge forward as a global leader in a highly innovative field the game software sector 2008 elsevier b v all rights reserved