is protection for sale evidence on the grossman helpman theory of endogenous protection grossman and helpman 1994 present a theory of endogenous protection by explicitly modeling government industry interactions for which mere black box models previously existed they obtain a ramsey pricing type solution to the provision of protection which emphasizes the role of inverse import penetration ratios and import elasticities on the lobbying side the model makes predictions about lobbying competition and lobbying spending according to deadweight costs from protection the model not only makes for richer theory in terms of rigor and elegance but its predictions are directly testable whether the grossman helman model stands up to real world data is investigated in this paper predictions from both the protection side and lobbying side are tested using cross sectional u s nontariff barrier data we also compare the second generation grossman helpman model with a more traditional specification our results call for serious consideration of this model in the political economy literature

rotating savings and credit associations credit markets and efficiency this paper examines the allocative performance of rotating savings and credit associations roscas a financial institution which is observed world wide we develop a model in which individuals save for an indivisible good and study roscas which distribute funds using random allocation and bidding the allocations achieved by the two types of rosca are compared with that achieved by a credit market and with efficient allocations more generally we find that neither type of rosca is efficient and that individuals are better off with a credit market than a bidding rosca nonetheless a random rosca may sometimes yield a higher level of ex ante expected utility to prospective participants than would a credit market i introduction rotating savings and credit associations roscas are a widely observed institution for financial intermediation they are found all over the world particularly in developing countries and have heretofore received scant attention from economists this paper and its companion piece besley coate and loury 1993 constitute a first attempt to analyse their economic role and performance roscas come in two main forms the first type allocates funds randomly in a random rosca members commit to putting a fixed sum of money into a pot for each period of the rosca s life lots are drawn and the pot is randomly allocated to one of the members in the next period the process repeats itself with each previous winner excluded from the draw the process continues until each rosca member has received the pot once at this point the rosca is either disbanded or begins over again individuals may also form a bidding rosca in which the pot is allocated via a bidding procedure the individual who

determining factors of curtailment and purchasing energy related behaviours changing people s behaviour in relation to energy consumption will be one of the most important challenges in the near future we analyzed the determinants behind individuals decisions to adopt curtailment behaviour or to purchase energy saving products using data from 213 university students we explored the influence of personal capabilities and moral norms along with trust in information on energy saving actions provided by different entities on two energy saving behaviours the results of the statistical model emphasise how personal norms and trust in information provided by private companies on the one hand and family and friends on the other strongly influence the adoption of energy saving actions and curtailment behaviours the paper reveals the pivotal role of private companies in developing the market demand for energy saving products by providing credible and scientifically based information on environmental performance the paper also contributes to strengthening the reliability of value belief norm theory and emphasizes the role of trust in information as a contextual factor that influences the adoption of a pro environmental behaviour

the economics of roscas and intrahousehold resource allocation this paper investigates individual motives to participate in rotating savings and credit associations roscas detailed evidence from roscas in a kenyan slum nairobi suggests that most roscas are predominantly composed of women particularly those living in a couple and earning an independent income to explain this phenomenon we propose an argument based on conflictual interactions within the household participation in a rosca is a strategy a wife employs to protect her savings against claims by her husband for immediate consumption the empirical implications of the model are then tested using the data collected in kenya

volunteerism after the tsunami the effects of democratization using three waves of survey data from fishing villages in aceh indonesia for 2005 09 the paper examines the determinants of local volunteer labor after the tsunami volunteer labor is the village public sector labor force for maintenance clean up and renovation of public capital while also examining the effects on volunteerism of village destruction and trauma pre existing social capital diversity and aid delivery the papers focuses on the effects of democratization the tsunami and massive international aid effort prompted the settlement of the insurgency movement in aceh which had led to suspension of local elections over the prior twenty or more years until 2006 village heads who call volunteer days were effectively selected by village elites who may highly value the public facilities maintained by volunteer labor with elections volunteer days fall under the new regime with democratically elected village heads calling fewer volunteer days which may appeal more to the typical villager identification comes from pseudo randomized differential timing of elections

the clash of liberalizations preferential versus multilateral trade liberalization in the european union there has been an explosion in the number of preferential trade agreements in the past decade preferential trade agreements are characterized by liberalization with respect to only a few partners and thus they can potentially clash with and retard multilateral trade liberalization despite this important concern with preferential trade agreements there is almost no systematic evidence on whether they actually affect multilateral trade liberalization the authors model the effect of preferential trade agreements on multilateral trade liberalization and show that preferential trade agreements slow down multilateral trade liberalization unless they have a common external tariff and allow for internal transfers next they use detailed data on product level tariffs negotiated by the european union in the past two multilateral trade rounds to structurally estimate their model the authors confirm the main prediction the european union s preferential trade agreements have clashed with its multilateral trade liberalization and find that the effect is quantitatively significant moreover they also confirm several auxiliary predictions of the model and provide new evidence on the political economy determinants of multilateral liberalization in the european union

participation rules for pareto optimal clubs abstract this paper presents a unifying framework for the club participation problem using compensating variation measures of willingness to pay for membership with more prospective club members than the equilibrium club population pareto efficient participation rules are derived which depend upon whether or not individuals are assured of club access sale of lottery tickets offering club membership is shown to be a socially superior club participation allocation mechanism to sale of vouchers guaranteeing membership the willingness to pay format readily encompasses the buchanan case where all prospective club members are assured of club participation

mainstreaming green product innovation why and how companies integrate environmental sustainability green product innovation has been recognized as one of the key factors to achieve growth environmental sustainability and a better quality of life understanding green product innovation as a result of interaction between innovation and sustainability has become a strategic priority for theory and practice this article investigates green product innovation by means of a multiple case study analysis of 12 small to medium size manufacturing companies based in italy and canada first we propose a conceptual framework that presents three key environmental dimensions of green product innovation such as energy minimization materials reduction and pollution prevention as identified in the life cycle phases of products based on insights gained from in depth interviews we discuss firms motivations to develop green products environmental policies and targets for products different dimensions of green product innovation and challenges faced during developing and marketing of green products results from the study are then synthesized and integrated in a toolbox that sheds light on various aspects of green product innovation and provides solutions to challenges and risks that are faced by firms finally implications for managers academia and public policy makers are discussed

women empowerment and economic development women empowerment and economic development are closely related in one direction development alone can play a major role in driving down inequality between men and women in the other direction empowering women may benefit development does this imply that pushing just one of these two levers would set a virtuous circle in motion this paper reviews the literature on both sides of the empowerment development nexus and argues that the interrelationships are probably too weak to be self sustaining and that continuous policy commitment to equality for its own sake may be needed to bring about equality between men and women

doing business in the 21st century with the new generation of chinese managers a study of generational shifts in work values in china our goal is to develop a profile of chinese managers and in particular a profile of the new generation of chinese managers the purpose for developing this profile is primarily to provide relevant information for non chinese business people especially westerners who plan to engage in business in china this profile is based on measures of individual values individualism collectivism and confucianism relevant to china and business our findings suggest that the new generation manager is more individualistic and more likely to act independently while taking risks in the pursuit of profits however these new managers are likewise not forsaking their confucian values thus they may be viewed as crossverging their eastern and western influences while on the road of modernization

enforcement in informal saving groups abstract informal groups cannot rely on external enforcement to insure that members abide by their obligations it is generally assumed that these problems are solved by social sanctions and reputational effects the present paper focuses on roscas one of the most commonly found informal financial institutions in the developing world we first show that in the absence of an external social sanctioning mechanism roscas are never sustainable even if the defecting member is excluded from all future roscas we then argue that the organizational structure of the rosca itself can be designed so as to address enforcement issues the implications of our analysis are consistent with first hand evidence from rosca groups in a kenyan slum

roscas as financial agreements to cope with self control problems abstract we consider a model in which people with limited self control can sign binding financial agreements among themselves thereby forming coalitions we show that these financial agreements may help them to alleviate their self control problems we then demonstrate that there exists a stable structure of coalitions in which people form rotating savings and credit associations roscas we therefore provide a behavioral rationale for one of the most prevalent and puzzling financial institutions in developing countries finally we derive and discuss some empirical predictions

la crema a case study of mutual fire insurance we analyze a mutual fire insurance mechanism used in andorra which is called la crema in the local language this mechanism relies on households announced property values to determine how much a household is reimbursed in the case of a fire and how payments are apportioned among other households the only pareto efficient allocation reachable through the mechanism requires that all households honestly report the true value of their property however such honest reporting is not an equilibrium except in the extreme case in which the property values are identical for all households nevertheless as the size of the society becomes large the benefits from deviating from truthful reporting vanish and all the nondegenerate equilibria of the mechanism are nearly truthful and approximately pareto efficient

rotating saving and credit associations in rural east africa abstract theoretical arguments suggest that rotating savings and credit associations roscas improve welfare by reducing the utility cost of saving for a consumer durable data from two communities in east africa reveal major differences in the incidence of roscas participation arising conjecturally from differences in the relative depths of market penetration and perceptions about the efficacy of alternative strategies for compensating for failures in the financial markets participation in roscas in these communities is partly driven by the need to raise school fees meet medical expenses and buy food roscas funds are also used to start or promote small businesses and acquire assets including livestock households owning smaller landholdings and those enjoying higher expenditures are more likely to participate in roscas the number of schemes in which a household participates is closely related to the main uses of roscas funds while contributions and value of receipts are determined by total expenditures and frequency of turns respectively

rosca composition and repayment evidence from taiwanese bidding roscas abstractrotating savings and credit associations roscas are widespread and remain a key financial management tool for poor individuals we analyse data from taiwanese bidding roscas and focus on how social relationships within the group influence contribution behaviour and rosca failure we find that less socially connected participants were more likely to receive the pot early in the cycle which increases their incentive to default yet contrary to accepted wisdom groups including more outsiders were not more likely to experience repayment problems our results highlights how bidding roscas can be a versatile device that provide profitable savings while allowing for emergency credit

indivisible labor lotteries and equilibrium abstract this paper considers an economy where labor is indivisible and agents are identical although the discontinuity in labor supply at the individual level disappears as a result of aggregation it is shown that indivisible labor has strong consequences for the aggregate bahavior of the economy it is also shown that optimal allocations involve lotteries over employment and consumption

the role of co opetition in low carbon manufacturing abstract low carbon manufacturing has become a strategic objective for many developed and developing economies this study examines the role of co opetition in achieving this objective we investigate the pricing and emissions reduction policies for two rival manufacturers with different emission reduction efficiencies under the cap and trade policy we assume that the product demand is price and emission sensitive based on non cooperative and cooperative games the optimal solutions for the two manufacturers are derived in the purely competitive and co opetitive market environments respectively through the discussion and numerical analysis we uncovered that in both pure competition and co opetition models the two manufacturers optimal prices depend on the unit price of carbon emission trading in addition higher emission reduction efficiency leads to lower optimal unit carbon emissions and higher profit in both the pure competition and co petition models interestingly compared to pure competition co opetition will lead to more profit and less total carbon emissions however the improvement in economic and environmental performance is based on higher product prices and unit carbon emissions

bank insured rosca for microfinance experimental evidence in poor egyptian villages abstract microfinance institutions mfis have continued to grow over the past few decades both in numbers of clients and portfolio sizes the growth of these mfis has enabled greater access to credit in many of the world s less developed nations however recent studies have shown that very many of the poor especially muslims remain unbanked confounding this problem in many muslim countries is the poor s propensity to reject microfinance when available on religious grounds in this paper we develop an alternative microfinance model which aims to establish credit unions for the poor in which the bank plays the role of a guarantor in the familiar rotating savings and credit association rosca we test the performance of this model against a stylized sequential grameen style microcredit provision in a laboratory experiment in the field conducted in poor egyptian villages our model of bank insured roscas is shown to solve coordination failure problems that may otherwise prevent the spontaneous development of informal roscas in practice empirically our bank insured rosca model generated significantly higher takeup and repayment rates than the grameen model this suggests that this model by overcoming the religious barriers to credit can be a useful alternative to grameen style microfinance

the role of informal finance in household capital accumulation evidence from taiwan economies that experience rapid growth also experience major changes in their consumption patterns particularly for consumer durables this paper studies the diffusion of durables in taiwan between 1977 and 1991 we focus on the link between household accumulation of durables and participation in informal financial institutions while growth in per capita income in taiwan had been great many households still reply on traditional forms of finance we test the idea that rotating savings and credit associations which are found worldwide exist to lower the cost of saving for durables our analysis finds evidence of that link

on tariff preferences and delegation decisions in customs unions a heckscher ohlin approach this paper studies preferences of customs union cu members over common external tariff cet levels and extends the literature on delegation decisions over trade policy in models with production in a model with similar cu members we prove that most preferred cets can be ranked with the help of compensated price elasticities of import demand functions in the heckscher ohlin trade model we show these elasticities depend on inter country differences in relative factor endowments and inter sectoral differences in technology this helps identify the optimal policy maker in a cu and demonstrates delegation decisions over trade policy can be integrated into mainstream trade theory the proliferation of preferential trade agreements ptas in the 1990s has presented policy analysts with a dual challenge to identify how these arrangements affect policy makers incentives to intervene in trade and to predict their implications for welfare economists responded to this challenge vigorously thanks to their research efforts a substantial body of work is now available addressing these issues under alternative assumptions regarding the theoretical environment considered including the objectives of policy makers the nature of their interactions the gatt rules that might constrain these interactions market structure the process of coalition formation etc 1 still while undeniably valuable the recent literature on regionalism has shed limited light on an important issue how heterogeneity among partners in a pta shapes their national preferences over external tariff levels and how these preferences in turn manifest themselves in the formation of actual trade

an empirical investigation of green purchase behaviour among the young generation due to an increasing awareness in environmental impact consumers are more sensitive towards green products when making their purchasing decisions the young generation who represents the future of our society seems to have a different attitude and belief which enables them to reflect on their choice of green products this research empirically examines the influence of ecological affect and ecological knowledge on the green purchasing behaviour of the young generation a survey was administered to young consumers between the age of 18 and 30 structural equation modelling was applied to test the hypotheses the analysis result confirms that the ecological effect and knowledge are significant in determining young consumers green involvement as well as their actual purchase

trade preferences to small developing countries and the welfare costs of lost multilateral liberalization the proliferation of preferential trade liberalization over the past 20 years has raised the question of whether it slows down multilateral trade liberalization recent theoretical and empirical evidence indicates this is the case even for unilateral preferences that industrial countries provide to small and poor countries but there is no estimate of the resulting welfare costs to avoid this stumbling block effect the authors suggest replacing unilateral preferences by a fixed import subsidy they argue that this scheme would reduce the drag of preferences on multilateral liberalization and generate a pareto improvement more important the authors provide the first estimates of the welfare cost of preferential liberalization as a stumbling block to multilateral liberalization by combining recent estimates of the stumbling block effect of preferences with data for 170 countries and over 5 000 products they calculate the welfare effects of the united states european union and japan switching from unilateral preferences to the developing countries to the import subsidy scheme even in a model with no dynamic gains to trade the authors find that the switch produces an annual net welfare gain for the 170 countries 4 354 million and for each group the united states european union and japan 2 934 million the developing countries 520 million and the rest of the world 900 million

the economics of rotating savings and credit associations supported by the center for energy policy studies m i t and the japanese corporate associates program at the kennedy school of government

prompting microfinance borrowers to save a field experiment from guatemala abstractcan microfinance borrowers use the discipline of regular loan repayments in order to accumulate savings if prompted to do so in an experiment we offered commercial savings products to the microfinance borrowers of guatemala s largest public sector bank we find that giving these borrowers the opportunity to develop a savings plan and be reminded of saving at the time of loan repayment caused no increase in the opening of savings accounts but led to balances among savers that were two and a half times those in the control a second treatment arm that proposed a default savings contribution of 10 of the loan payment caused the fraction of clients using linked savings accounts to double as well as elevated deposits among savers leading to final savings balances that were more than five times the control the savings treatments also generate faster pay down of debt and weakly better overall repayment performance suggesting that simultaneous saving and borrowing can be complementary activities a

can an islamic model of housing finance cooperative elevate the economic status of the underprivileged abstract a formal home loan is onerous to subprime borrowers in efficient markets this can deter home ownership for financially strapped individuals leading to a market failure this paper proposes a special form of cooperative mortgage financing practiced in oman to overcome this market failure we integrate the literature of mortgage design with that of informal savings schemes i e roscas ascras to illustrate that this mode of financing dissipates credit risk better than the

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

matching in informal financial institutions this paper analyzes an informal financial institution that brings heterogeneous agents together in groups we analyze decentralized matching into these groups and the equilibrium composition of participants that consequently arises we find that participants sort remarkably well across the competing groups and that they re sort immediately following an unexpected exogenous regulatory change these findings suggest that the competitive matching model might have applicability and bite in other settings where matching is an important equilibrium phenomenon jel o12 o17 g20 d40

goods prices and exchange rates what have we learned import prices typically change by a smaller proportion than the exchange rate between the exporting and importing country recent research indicates that common currency relative prices for similar goods exported to different markets are highly correlated with exchange rates between those markets this evidence suggests that incomplete pass through is a consequence of third degree price discrimination while distance matters for market segmentation borders have independent effects the source of the border effect has not been clearly identified furthermore there is little evidence yet to suggest substantial market power is implied by the observed price discrimination

development and the interaction of enforcement institutions we examine how formal and informal contract enforcing institutions interact in a competitive market with asymmetric information where consumers do not observe quality before purchase firm level incentives for producing high quality can be achieved with an informal enforcement mechanism reputation the efficacy of which is enhanced by consumers investing in connectedness or with a formal mechanism legal enforcement the effectiveness of which can be reduced by means of bribes we show that formal and informal enforcement mechanisms do not necessarily substitute each other while high levels of judicial efficiency decrease consumers incentives to connect higher consumers connectedness leads to higher levels of judicial efficiency we then look at how the equilibrium institutional mix evolves with the level of development in doing so we show the presence of a new physical channel that can affect institutions i e the frequency of bad productivity shocks that in less developed settings can impact on firms incentives to cheat c 2010 elsevier b v all rights reserved

risk matching behavior in microcredit group formation evidence from northern ethiopia theoretical models on group lending assume the formation of groups of homogenous risk types recent theoretical and empirical findings challenge this view arguing that when markets for insurance are missing risk homogeneity may not hold any more and risk heterogeneity can be the optimal outcome using data from an mfi in tigray ethiopia this article examines the homogeneity hypothesis and reflects on implications for repayment no evidence is found that supports risk homogeneity even accounting for matching frictions however we also do not find an explicit link between the presence of risk heterogeneity and side payments due to missing insurance as suggested in the literature instead other trust based social networks seem to underlie heterogeneity such social networks are often synchronized with credit groups and influence the probability of repayment under heterogeneity the implication is that successful repayment rates in group lending need not arise only under risk homogeneity but can also arise under risk heterogeneity heterogeneity may also serve to bridge missing insurance markets in poor rural environments mfis therefore need to consider such local conditions when designing their lending schemes

rotating savings and credit associations when participants are risk averse we model rotating savings and credit associations roscas among risk averse participants who experience privately observed income shocks a random rosca is not advantageous whereas a bidding rosca is if temporal risk aversion is less pronounced than static risk aversion the payoff scheme of a bidding rosca facilitates risk sharing in the presence of information asymmetries the risk sharing performance of a simple arrangement where a group of homogenous individuals runs several bidding roscas simultaneously is as good as that of a linear risk sharing contract and is more enforceable because it carries a fixed rather than a variable contribution

the anatomy of an informal financial market rosca participation in taiwan abstract little is known about informal financial markets in developing countries this paper analyzes participation in rotating savings and credit associations using a national household survey from taiwan we find that participation is highest among high income households there is some evidence that income stability may play a role as well life cycle differences suggest a role in funding durables purchases our evidence indicates that roscas may be an alternative savings device to the formal financial sector

trade diversion and declining tariffs evidence from mercosur abstract this paper empirically examines the alternative posed by richardson j intern econ 34 1993 39 to the traditional view that trade integration may exacerbate inefficiencies richardson s hypothesis boldly predicts that trade diversion and trade creation may actually cause tariffs to decline the hypothesis is fundamentally attributable to the presence of a political component in the governments objective functions a cross sectionally rich data set on trade and tariffs from the mercosur pact countries primarily argentina is used the evidence yields surprising conclusions about the validity of endogenous tariff determination in models of trade integration

a fresh look at understanding green consumer behavior among young urban indian consumers through the lens of theory of planned behavior abstract rapid economic growth and resulting overconsumption have accelerated environmental deterioration worldwide prompting escalated consumption related environmental concerns this study attempts to explore the antecedents of ecologically conscious consumer behavior eccb among young urban consumers in india an emerging market experiencing rapid economic growth with increased urbanization and changes in consumption patterns that are contributing to environmental hazard the empirical study including a literature review uses theory of planned behavior integrating environmental attitudes subjective norms perceived consumer effectiveness and behavioral intention in the model to investigate their influence on eccb the results suggest that attitudes and perceived consumer effectiveness both have a significant direct and indirect positive influence on eccb in addition it would appear that the subjective norm a measure of social demand does not have any significant influence on behavioral intention leading to eccb contrary to established findings in a collective society considered in this study this paper concludes with policy implications of the findings for marketers and policymakers as well as potential directions for further research

impact of village savings and loan associations evidence from a cluster randomized trial the vast majority of the world s poor live in rural areas of developing countries with little access to financial services setting up village savings and loan associations vslas has become an increasingly widespread intervention aimed at improving local financial intermediation using a cluster randomized trial we investigate the impact of vslas in northern malawi over a two year period we find evidence of positive and significant intention to treat effects on several outcomes including the number of meals consumed per day household expenditure as measured by the usaid poverty assessment tool and the number of rooms in the dwelling this effect is linked to an increase in savings and credit obtained through the vslas which has increased agricultural investments and income from small businesses