industrial pollution abatement the impact on balance of trade this paper uses an ex post partial equilibrium framework to measure the impact of marginal changes in industrial p ollution abatement costs on the u s balance of trade in general and balance of trade with canada in particular the impacts are found to be negative for most industries growing with trade volume and smal l relative to domestic consumption in addition some evidence is fou nd that pollution control programs have changed the u s comparative advantage such that more high abatement cost goods are imported and m ore low abatement cost goods are exported

a model of forum shopping owners of intellectual property or mere sponsors of an idea e g authors security issuers sponsors of standards resort to more or less independent certifiers to persuade potential users buyers or adopters of the worth of their property or idea we analyze the sponsor s choices ofcertifier and design social preferences regarding these choices and the impacts thereon of multiple categories of users of a downstream presence of the sponsor and of certifier market power finally we study strategic forum shopping by sponsors of competing ideas

industrial pollution in economic development the environmental kuznets curve revisited abstract using new international data this paper tests the environmental kuznets curve ekc hypothesis for industrial water pollution we measure the effect of income growth on three determinants of pollution the share of industry in national output the share of polluting sectors in industrial output and end of pipe eop pollution intensities per unit of output in the polluting sectors we find that the industry share of national output follows a kuznets type trajectory but the other two determinants do not when combined our results imply rejection of the ekc hypothesis for industrial water pollution it rises rapidly through middle income status and remains roughly constant thereafter

the short run impact of environmental protection costs on u s product prices using an input output framework this paper investigates the magnitude of the impact that environmental protection costs had on prices in the united states in 1977 with the imposition of environmental protection costs the projected total price increases for individual industries range from 0 12 to 6 58 due to data limitations the constraints of input output analysis and the structural changes that occurred in the economy from 1972 to 1977 the results should not be taken as definitive however the results do indicate the typical sort of variation in impact likely to occur across industries and that the average impact on prices was modest

what do entrepreneurs pay for venture capital affiliation this study empirically evaluates the certification and value added roles of reputable venture capitalists vcs using a novel sample of entrepreneurial start ups with multiple financing offers i analyze financing offers made by competing vcs at the first professional round of start up funding holding characteristics of the start up fixed offers made by vcs with a high reputation are three times more likely to be accepted and high reputation vcs acquire start up equity at a 10 14 discount the evidence suggests that vcs extra financial value may be more distinctive than their functionally equivalent financial capital these extra financial services can have financial consequences a central issue for early stage high tech entrepreneurs is obtaining external resources when the assets of their start up are intangible and knowledge based particularly for entrepreneurs without an established reputation convincing external resource providers such as venture capitalists vcs to provide financial capital may be challenging the literature contains two main lines of research for overcoming this problem one research stream has concentrated on designing institutional structures to permit financing early stage ventures this contractual and monitoring based approach is aimed at solving potential agency problems between investors and entrepreneurs e g admati and pfleiderer 1994 lerner 1995 hellmann 1998 and kaplan and str omberg 2001 2002 2003 a second research stream has suggested that when the quality of a start up cannot be directly observed external actors rely on the quality of the start up s affiliates as a signal of the start up s own quality

standard setting committees consensus governance for shared technology platforms voluntary standard setting organizations ssos use a consensus process to create new compatibility standards practitioners have suggested that ssos are increasingly politicized and perhaps incapable of producing timely standards this article develops a simple model of standard setting committees and tests its predictions using data from the internet engineering task force an sso that produces many of the standards used to run the internet the results show that an observed slowdown in standards production between 1993 and 2003 can be linked to distributional conflicts created by the rapid commercialization of the internet jel c78 l15 l86

is the internet a us invention an economic and technological history of computer networking abstract although the inventions embodied in the internet originated in a diverse set of industrial economies the us was consistently the source of critical innovations and an early adopter of new applications why did other nations including several that made important inventive contributions to the internet not play a larger role in its development particularly in the creation of new business organizations governance institutions and applications we argue that the role of the us national innovation system in the creation of the internet echoes several key themes of us technological development before 1940 the presence of a large domestic market a set of antitrust and regulatory policies that weakened the power of incumbent telecommunications firms and a diverse private public research community that was willing to work with both domestic and foreign inventions were important preconditions for us leadership in computer networking innovation

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

uniform compliance costs for mineral commodities who gains and who loses changes in energy and nonfuelmineral production consumption and net export revenue that result from environmental protection are estimated by income class and geographic region unlike previous assessments of unilateral adoption of standards i assume that all producers incur equal cleanup costs adjustment is therefore accomplished through changes in prices and quantities rather than altered trade patterns the estimated magnitude of worldwide changes is not large moreover many poor countries are forecast to benefit since their terms of trade improve however the problem of obtaining foreign exchange for investment remains a financing scheme that divorces efficiency from equity is suggested

are monetary policy reaction functions asymmetric the role of nonlinearity in the phillips curve abstract this paper investigates the implications of a nonlinear phillips curve for the derivation of optimal monetary policy rules combined with a quadratic loss function the optimal policy is also nonlinear with the policy maker increasing interest rates by a larger amount when inflation or output are above target than the amount it will reduce them when they are below target specifically the main prediction of our model is that such a source of nonlinearity leads to the inclusion of the interaction between expected inflation and the output gap in an otherwise linear taylor rule we find empirical support for this type of asymmetries in the interest rate setting behaviour of four european central banks but none for the us fed

international trade and environmental quality a survey abstract international trade has been incorporating various aspects of environmental issues since 1970 the extent to which environmental problems might affect many facets of trade or vice versa has been the subject of considerable debate over these years in this article we have attempted to establish some of the links between international trade and environmental quality by performing a comprehensive literature review we discuss issues such as establishing direct and indirect effects of international trade on environmental quality effects of trade on economic development environmental quality and energy and their relation with each other and finally the role of governments and international organizations in this context studies have so far revealed some linkages between trade and environment through conventional trade theory however interactions between international trade and types of pollution their sink and assimilative capacity need to be analyzed using a general equilibrium approach currently very little knowledge and agreement on the nature of interactions between trade theories development process and environmental quality exist existing studies have shown that the structure of environmental regulations should be modified to reflect the existence of trade under imperfect competition therefore further research on the interaction between new trade theory and environmental regulation is needed also theoretical and quantitative analysis regarding the effects of environmental regulations on competitiveness and location decision is needed the intensity and type of environmental measures vary across issues and countries therefore harmonizing environmental measures creates an inefficient atmosphere and to assume that trade restrictions will either improve or reverse the environmental damages is a serious mistake given the dynamic and intricate nature of the problem trade and environment debate continues despite vast research and poses a challenge for researchers and policy makers in the foreseeable future

optimal nonlinear policy signal extraction with a non normal prior the literature on optimal monetary policy typically makes three major assumptions 1 policymakers preferences are quadratic 2 the economy is linear and 3 stochastic shocks and policymakers prior beliefs about unobserved variables are normally distributed this paper relaxes the third assumption and explores its implications for optimal policy the separation principle continues to hold in this framework allowing for tractability and application to forward looking models but policymakers beliefs are no longer updated in a linear fashion allowing for plausible nonlinearities in optimal policy we consider in particular a class of models in which policymakers priors about the natural rate of unemployment are diffuse in a region around the mean when this is the case it is optimal for policy to respond cautiously to small surprises in the observed unemployment rate but become increasingly aggressive at the margin these features of optimal policy match statements by federal reserve officials and the behavior of the fed in the 1990s

an ecological economic assessment of deregulation of international commerce under gatt this paper discusses the ecological economic implications of deregulation of trade as promoted by the general agreement on tariffs and trade gatt 1 this includes both environmental2 and socio economic factors such as standards of living and equity we outline fifteen overlapping problems with deregulation or free trade we argue that many environmental problems cannot be resolved equitably efficiently or sustainably by unregulated markets and that there is no alternative to public intervention in certain situations we repeat the 1987 brundtland commission s question of how far into international trade should regulation penetrate wced 1987 the commission s call for gatt s environmental reform 3 has not yet been heeded

monetary policy when interest rates are bounded at zero this paper assesses the importance of the zero lower bound on nominal interest rates for the interest rate channel of monetary policy we simulate several interest rate setting policy rules with ei

nairu uncertainty and nonlinear policy rules meyer 1999 has suggested that episodes of heightened uncertainty about the nairu may warrant a nonlinear policy response to changes in the unemployment rate this paper offers a theoretical justification for such a nonlinear policy rule and provides some empirical evidence on the relative performance of linear and nonlinear rules when there is heightened uncertainty about the nairu

free trade and the environment development system abstract we develop a simulation model to analyze the trade environment development system that contains a number of important advances over the earlier and current theoretical models our model like other models has an income induced pollution policy allows country factor endowments to influence trade patterns and allows production factors to be mobile intersectorally unlike other theoretical models our model treats pollution stemming from both production and consumption in a way that does justice to empirical observations we model pollution policy explicitly as an abatement investment thus effectively allowing for differences in pollution intensive technology across countries in addition we allow for an internationally traded intermediate good a natural resource as a result of this novel approach we find that 1 the benefits of trade i can be either positive or negative and ii depend on country endowments and 2 the pollution effects of trade are closely tied to the benefits of trade our model generally shows higher pollution levels under free trade than autarky however our results do not support the pollution haven hypothesis i e trade causes less pollution in developed countries and more pollution in developing ones some developing countries produce more of the pollution intensive good but ultimately consume less pollution under autarky because they have higher per capita income and thus invest more heavily in environmental upgrading under autarky

the impact of pollution abatement investment on productivity change anempirical comparison of the u s germany and canada since environmental quality became an important focus of government regulations in most industrialized countries in the early 1970s many researchers have assessed the impact of these regulations on economic performance for example leontief and ford 11 and pasurka 15 investigated the impact that environmental protection costs had on prices in the u s walter 24 calculated the effect of pollution abatement expenditures on u s trade and robinson 19 measured the distributional impact of the burden of industrial pollution abatement a related issue involves the productivity consequences of environmental regulations in this paper we address this issue by considering the impact of pollution abatement investment on productivity growth

how do federal regulations affect consumer prices an analysis of the regressive effects of regulation this study is the first to measure the impact of federal regulations on consumer prices by combining consumer expenditure and pricing data from the bureau of labor statistics industry supply chain data from the bureau of economic analysis and industry specific regulation information from the mercatus center s regdata database we determine that regulations promote higher consumer prices and that these price increases have a disproportionately negative effect on low income households specifically we find that the poorest households spend larger proportions of their incomes on heavily regulated goods and services prone to sharp price increases while the literature explores other specific costs of regulation noting that higher consumer prices are a probable consequence of heavy regulation this study is the first to provide a thorough empirical analysis of that relationship across industries irrespective of the reasons for imposing new regulations these results demonstrate that in the aggregate the negative consequences are significant especially for the most vulnerable households

robust monetary policy with competing reference models abstract the existing literature on robust monetary policy rules has largely focused on the case in which the policymaker has a single reference model while the true economy lies within a specified neighborhood of the reference model in this paper we show that such rules may perform very poorly in the more general case in which non nested models represent competing perspectives about controversial issues such as expectations formation and inflation persistence using bayesian and minimax strategies we then consider whether any simple rule can provide robust performance across such divergent representations of the economy we find that a robust outcome is attainable only in cases where the objective function places substantial weight on stabilizing both output and inflation in contrast we are unable to find a robust policy rule when the sole policy objective is to stabilize inflation we analyze these results using a new diagnostic approach namely by quantifying the fault tolerance of each model economy with respect to deviations from optimal policy

who pays for industrial pollution abatement the distributional impact of industrial pollution abatement is measured for the years 1973 and 1977 the findings indicate that in 1977 1 09 of income or 0 510 of personal consumption expenditures of the lowest income class paid indirectly for abatement costs implicit in purchased goods for the highest income class the corresponding figures were 0 218 and 0 423 respectively in addition abatement costs per dollar of output are presented for representative industries

trade and the environment from a southern perspective the relationship between free trade and the environment is one of the main issues of contention between environmental and ecological economics environmental economics assumes a positive relationship between free trade economic growth and environmental policies environmental externalities may cause important damage however trade is not to be blamed for this instead the fault lies with policy inadequacies at the national level on the other hand some ecological economists criticise the assumptions of environmental economics especially the immobility of production factors and the positive correlation between income and environmental quality they plead for measures to prevent deterioration of northern environmental standards in a race to the bottom due to ecological dumping from the south in this paper we argue that neither environmental economics nor northern ecological economics take into account the structural conditions determining the international trade system based on some new empirical evidence on material flows we stress the notion of environmental cost shifting if physical and political ecology perspectives are adopted a southern approach to the trade and environment issue may arise 2001 elsevier science b v all rights reserved

grey input output analysis and its application for environmental cost allocation abstract deterministic input output analysis has been applied to solving a variety of economic problems nevertheless uncertainty plays an important role in decision making and should be properly addressed in future input output analysis this study therefore describes a method of including systematic parameter uncertainties in an input output model and develops its solution procedure using the genetic algorithm based ga based grey mathematical programming technique as a tool in particular the model for assessing the impacts of recent pollution charges and water resource fees to a textile dyeing factory is formulated and solved for the purpose of illustration to account for the gross impact from systematic variations most parameters are expressed as interval expressions as that are frequently used in the grey systems theory research findings indicate that the grey input output analysis is an applicable tool to evaluate various environmental cost impacts influential for corporate production planning and management

scanning the commons evidence on the benefits to startups participating in open standards development this paper contributes large sample evidence to an emerging discussion on open innovation and firm strategy we ask why a startup should participate in an open standards community we propose four ways that participation might increase a startup s chances of a liquidity event gaining endorsement of the startup s technology standard openly developing the startup s technology within the community but not necessarily gaining endorsement simply attending physical meetings of the community and having startup members elected to leadership positions examination of venture funded startups in the networking data communications industry sectors reveals that those startups that participate in an open standards community the internet engineering task force ietf have a greater likelihood of an initial public offering or acquisition the strongest effects are due to attendance and conditional on high levels of attendance holding leadership positions within the ietf surprisingly standards endorsement is insignificant when controlling for simple physical attendance these results are robust to instrumental variable methods and alternative coding of variables in two stage models we also find that prominent venture capitalists might help their portfolio companies by steering them to effective technology strategies in this case active participation in the ietf and not simply by lending status

environmental regulation a value theoretic and class based analysis following a value theoretic and class based approach it is argued in this paper that ecological problems are inseparably linked to the process of extracting surplus value in capitalism and owing to their adverse impacts instigate struggles over the appropriation of nature these struggles fought within and outside the state by competing agents shape environmental regulation in particular taxes permits command and control measures and subsidies affect prices profits and rents and have class and other social implications evidence of current environmental regulation shows that it takes places under the great influence of capitalist concerns

standard setting organisations and standard essential patents voting and markets the analysis provides conditions under which standard setting organisations ssos choose efficient technology standards i introduce a two stage game with both voting and market competition in equilibrium standards and market outcomes are efficient even with market power from scarce capacity and standard essential patents seps i show that a drastic innovation with seps generates greater social welfare than a less efficient standard without seps a key finding is that voting power and market power have counterbalancing effects the discussion helps explain empirical observation of differences in sso voting rules intellectual property ip rules membership and alliances

a man on the inside unlocking communities as complementary assets abstract since teece s seminal paper explaining who were the gainers from technological innovation increased globalization and the information and communication technology revolution have brought new ways for firms to organize and appropriate from innovation a new more open model of innovation suggests that firms can benefit from sources of innovation that stem from outside the firm the central theme of this paper is how firms try to unlock communities as complementary assets these communities exist outside firm boundaries beyond ownership or hierarchical control because of practices developed by communities to protect their work firms need to assign individuals to work in these communities in order to gain access to developments and to an extent influence the direction of the community using network analysis we show that some software firms sponsor individuals to act strategically within a free and open source software foss community firm sponsored individuals interact with more individuals than interact with them and also they seek to interact with central individuals in the community however we can see differences in how individuals interact depending on whether their affiliation is with a dedicated foss firm or an incumbent in the software industry apparently some firm managers believe they need a man on the inside to be able to gain access to communities

international trade and environmental regulation time series evidence and cross section test this paper examines empiricallywhether more stringent domestic environmental policiesreduce the international competitiveness ofenvironmentally sensitive goods esgs our timeseries evidence indicates that there are no systematicchanges in trade patterns of esgs in the last threedecades despite the introduction of more stringentenvironmental regulations in most of the developedcountries in the 1970s and 1980s this observedphenomenon is then subjected to a multi countryeconometric test using an extended gravity equationframework the test suggests that overall morestringent environmental regulations do not reducetotal exports exports of esgs and exports ofnon resource based esgs neither was there anyevidence to support the hypothesis that new tradebarriers emerge to offset the effects of morestringent environmental regulations

which ties matter when the contingent effects of interorganizational partnerships on ipo success this paper investigates the contingent value of interorganizational relationships at the time of a young firm s initial public offering ipo we compare the signaling value to young firms of having ties with two types of interorganizational partnerships endorsement relationships such as those with venture capital firms and investment banks and strategic alliance partnerships we propose that under different equity market conditions potential investors in an issuing firm attend to different types of uncertainty attention to these different types of uncertainty affects investors perceptions of the relative value of a young firm s different kinds of endorsements and partnerships and hence ipo success results from a sample of young biotechnology firms show that ties to prominent venture capital firms are particularly beneficial to ipo success during cold markets while ties to prominent investment banks are particularly beneficial to ipo success during hot markets a firm s strategic alliances with major pharmaceutical health care firms did not have such contingent effects implications for understanding the contingent value of interorganizational ties are discussed copyright 2003 john wiley sons ltd

the fed s monetary policy rule and u s inflation the case of asymmetric preferences abstract this paper investigates the empirical relevance of a new framework for monetary policy analysis in which the decision makers are allowed but not required to weight differently positive and negative deviations of inflation and output from the target values the estimates of the central bank s euler equation indicate that the preferences of the fed had been asymmetric only before 1979 with the interest rate response to output contractions being larger than the response to output expansions of the same magnitude we show that this asymmetry on output implied an average inflation bias around 1 5 while the implicit inflation target also declined the asymmetric preferences induced inflation bias appears to account for a sizable fraction of the historical decline in the inflation mean

environmental tariffs on polluting imports this paper examines the implications for the use of trade measures as weapons to address global environmental concerns there are already proposals in the u s senate to impose an environmental tariff against foreign nations whose cost advantages stem from less stringent environmental standards than the u s the paper argues that trade policy measures typically are not the first best instruments for achieving environmental objectives even theoretically they could be shown to be welfare improving only under a very narrow range of circumstances their use in place of more efficient policy instruments may not only end up distorting the patterns of world trade but also may worsen the overall patterns of environmental quality simulation exercises undertaken here suggest that it is highly unlikely that countries would alter their environmental behavior because of the imposition of the proposed u s tariff hence the proposed legislation has very uncertain environmental consequences even if the policy has been mainly designed to protect domestic industries it would only provide a minor margin of protection because the costs of complying with the environmental standards represent a relatively small element in the total costs the analysis suggests that trade policy introduced in this fashion will have no significant impact on the patterns of world trade and pollution

inflation targeting credibility and non linear taylor rules abstract in this paper we systematically evaluate how central banks respond to deviations from the inflation target we present a stylized new keynesian model in which agents inflation expectations are sensitive to deviations from the inflation target to re establish credibility monetary policy under discretion sets higher interest rates today if average inflation exceeded the target in the past moreover the central bank responds non linearly to past inflation gaps this is reflected in an additional term in the central bank s instrument rule which we refer to as the credibility loss augmenting a standard taylor 1993 rule with the latter term we provide empirical evidence for the interest rate response for a sample of five inflation targeting it economies we find first that past deviations from it feed back into the reaction function and that this influence is economically meaningful deterioration in credibility ceteris paribus forces central bankers to undertake larger interest rate steps second we detect an asymmetric reaction to positive and negative credibility losses with the latter dominating the former

simple monetary policymaking without the output gap several research contributions have argued that information about the output gap is essential for a good monetary policy rule however as pointed out by orphanides 2001 there is considerable real time uncertainty about the size of the output gap the paper argues that simple monetary policy rules that rely exclusively on survey based information about future and past inflation rates may be more efficient than optimized taylor rules once realtime output gap uncertainty is accounted for even when only information about historical inflation rates is available a very simple policy rule may be constructed that improves on the taylor rule