a new decision rule for lateral transshipments in inventory systems this paper deals with a single echelon inventory system consisting of a number of parallel local warehouses facing compound poisson demand there are standard holding and backorder costs as well as ordering costs at all warehouses normally the warehouses replenish from an outside supplier however lateral transshipments between the warehouses are also possible such transshipments take no time but incur additional costs when a demand occurs at a warehouse the question is whether the whole demand or part of it should be covered by a lateral transshipment from another warehouse given a set of alternative decisions our decision rule minimizes the expected costs under the assumption that no further transshipments will take place this rule is then used repeatedly as a heuristic a simulation study illustrates how the suggested technique performs under different conditions

virtual special issue editorial essay the shitty rent business what s the point of land rent theory in this introduction to a virtual special issue on land rent we sketch out the history of land rent theory encompassing classical political economy marx s political economy the marginalist turn and subsequent foundations for urban economics and the marxist consensus around rent theory during geography s spatial turn we then overview some of the contemporary strands of literature that have developed since the break down of this consensus namely political economy approaches centred on capital switching institutionalism of various stripes and the rent gap theory we offer a critical urban political economy perspective and a particular set of arguments run through the review first land is not the same as capital but has unique attributes as a factor of production which require a separate theorisation second since the 1970s consensus around land rent and the city dissipated the critical literature has tended to take the question of why how the payment exists at all for granted and so has ignored the particular dynamics of rent arising from the idiosyncrasies of land amongst the talk of an anthropocene and planetary urbanisation it is surprising that the economic fulcrum of the capitalist remaking of geography has fallen so completely off the agenda it is time to bring rent back into the analysis of land cities and capitalism

property market efficiency an institutional economics perspective this paper reassesses the debate around property market efficiency and introduces an institutional perspective it considers property market efficiency in terms of the specific characteristics of property itself and the processes through which property is used and traded it argues that the institutional dimension fundamentally alters the concept of efficiency and leads to a partial and contingent judgement on achieved efficiency instead of seeking a judgement on whether the property market as an entity is efficient the institutional approach allows the possibility that property market process may be efficient for some market participants but not for others it also introduces a time dimension suggesting the need to assess the adaptability of property market process as economic and social conditions change

public services increasing returns and equilibrium dynamics abstract this paper is concerned with casting off the standard assumption the production function displays socially constant returns to scale in a simple growth model with public inputs in the model public services work as a source of utility and as an input to production making use of the global bifurcation technique we show that the model can generate a whole spectrum of interesting dynamics which do not arise with constant returns specifically when increasing returns are not exceedingly strong not only does an indeterminate steady state take place but also there exist divergent perfect foresight paths in expanding oscillations and economic cycles the role of history and expectations in shaping equilibrium is also considered

a semi markov decision problem for proactive and reactive transshipments between multiple warehouses abstract lateral transshipments are an effective strategy to pool inventories we present a semi markov decision problem formulation for proactive and reactive transshipments in a multi location continuous review distribution inventory system with poisson demand and one for one replenishment policy for a two location model we state the monotonicity of an optimal policy in a numerical study we compare the benefits of proactive and different reactive transshipment rules the benefits of proactive transshipments are the largest for networks with intermediate opportunities of demand pooling and the difference between alternative reactive transshipment rules is negligible

exploring the notional property developer as a policy construct this paper explores how far policy makers understand the structure of the development industry the perceived characteristics of developers and the extent to which such actors can be considered policy responsive if these matters are poorly understood the effectiveness of planning policy may be undermined especially where the private sector is responsible for undertaking most development the paper is based upon empirical research on the scottish executive s perceptions of and policy stances towards developers between 1999 and 2007 it finds that the executive appeared to have only limited understanding of what drives the development process or motivates individual developers and seemed unfamiliar with important differences within the industry sectorally and geographically instead the notional property developer was incorrectly conceived as a malleable and potentially compliant partner with shared objectives to the state the paper calls for a more thorough understanding of the development industr

fiscal policy and growth in a small open economy with elastic labour supply endogenizing labour supply leads to fundamental changes in the equilibrium structure of the ak growth model of a small open economy the balanced growth equilibrium is described by two tradeoff loci relating the equilibrium growth rate to the fraction of time devoted to leisure the implications of endogenous labour supply for fiscal policy are addressed the effects of distortionary taxes and government expenditure on the equilibrium growth leisure employment tradeoff are analysed the responses contrast with both those of a closed economy having an elastic labour supply and an open economy with fixed labour supply optimal fiscal policy is also characterized jel classification f41 f43 politique fiscale et croissance dans une petite economie ouverte quand l offre de travail est elastique l endogeneisation de l offre de travail entraine des changements fondamentaux dans la structure d equilibre du modele de croissance du type ak d une petite economie ouverte l equilibre de croissance balancee est decrit par deux lieux de relations d equivalence reliant le taux de croissance d equilibre a la fraction du temps allouee au loisir on examine les implications de cette endogen6isation de l offre de travail pour la politique fiscale on analyse les effets de taxes distorsionnantes et des depenses gouvemementales sur la relation d 6equivalence entre taux de croissance et loisir et donc emploi on obtient des reactions differentes de celles qu on obtient en economie ferm6e quand l offre de travail est elastique et en economie ouverte quand l offre de travail est fixe on proc ede alors a la definition de la politique fiscale optimale

increasing returns capital utilization and the effects of government spending abstract we show that a one sector real business cycle model with mild increasing returns to scale variable capital utilization and saddle path stability is able to produce qualitatively realistic business cycles driven solely by disturbances to government purchases due to an endogenous increase in labor productivity a positive spending shock can lead to simultaneous increases in output consumption investment employment and real wage our analysis illustrates a close relationship between this result and the recent literature that explores indeterminacy and sunspots in real business cycle models under laissez faire in particular the condition which governs the required magnitude of increasing returns for government spending shocks to generate procyclical macroeconomic effects is identical to that necessary for a laissez faire one sector real business cycle model to exhibit local indeterminacy

the role and behaviour of commercial property investors and developers in french urban regeneration the experience of the paris region summary this paper provides an analysis of the factors underlying private investment decisions concerning property development with specific reference to urban regeneration in the french context it is based on the results of a behavioural survey and mca analysis of the behaviour patterns and motivations of active private investors and developers in the french commercial property markets and their involvement in french urban regeneration initiatives the pattern of investment and development activity over the 1997 2002 french property market recovery period has been studied and a typology of actors set up based on their investment policy for these property markets the findings indicate that property investors in urban regeneration essentially seek speculative developments and short term investments

schooling and public capital in a model of endogenous growth this paper studies the allocation of public spending between education services and infrastructure investment in an endogenous growth model where public capital in infrastructure affects the process of human capital accumulation the balanced growth path is derived and the dynamics associated with a budget neutral reallocation of spending from education to infrastructure are studied through numerical simulations the growth maximizing tax rate is shown to depend only on the production technology as in standard flow models of public expenditure whereas the optimal share of infrastructure investment depends also on the productiveness of infrastructure relative to education services in the schooling technology

endogenous markups and the effects of income taxation theory and evidence from oecd countries abstract existing studies on the effects of fiscal policy under imperfect competition typically treat each firm s price cost markup as fixed this paper examines the implications of endogenising the markup in a simple model of income taxation under monopolistic competition it is demonstrated that an increase in income tax reduces the number of firms lessens competition among surviving firms and raises the optimal markups in the new steady state through this channel the effects of income taxation on the key macroeconomic variables as well as on consumer welfare are unambiguously enlarged the simple model prediction is largely supported by cross section regressions with data from oecd countries

is the relationship between financial development and economic growth monotonic evidence from a sample of middle income countries summary we revisit the relationship between financial development and economic growth in a panel of 52 middle income countries over the 1980 2008 period using pooled mean group estimations in a dynamic heterogeneous panel setting we show that there is an inverted u shaped relationship between finance and growth in the long run in the short run the relationship is insignificant this suggests that too much finance can exert a negative influence on growth in middle income countries the finding of a non monotonic effect of financial development on growth is confirmed by estimating a threshold model

risk the financial market and macroeconomic equilibrium growing recognition of the importance of stock market phenomena to the real economy underscores the need for models linking exogenous uncertainty asset market performance and the rest of the economy in an optimizing framework without certainty equivalence this paper constructs a three agent model with continuous time stochastic variables uncertain private production and government expenditure and forward looking rational agents the growth rate of output physical capital accumulation financial asset returns and uncertain inflation are determined as functions of the exogenous uncertainty in the economy analysis of the model finds that increased risk associated with government policy often reverses in an explainable way the conventional comparative static predictions of nonstochastic macro models

an alternative to steady state comparisons in perfect foresight models abstract this note examines a technique for the computation of the welfare impact of a pertubation of the steady state in a typical perfect foresight model the major innovation is the ability to analyze non stationary perturbations

common interest development and the changing roles of government and market in planning world wide common interest development cid and its governance homeowners associations hoas are developing rapidly however numerous conflicts have given rise to the need to redefine govern

money and endogenous growth the ramsey romer model of endogenous growth is extended to allow for holdings of real money balances and government debt as well as capital and for non interconnected generations of households tax financed increases in government consumption and debt depress growth prospects and boost inflation as long as a positive birth rate ensures that future taxes are shouldered by future yet unborn generations debt financed increases in government consumption depress growth and boost inflation even more money financed increases in government consumption depress growth less but increase inflation by more giving subsidies through an increase in monetary growth is non neutral since this increases real growth and thus inflation increases by a lesser amount than monetary growth bond financed increases in monetary growth lead to a larger increase in real growth and a smaller increase in inflation if there are cost adjustment for investment cuts in monetary growth and increases in government debt and government consumption induce an increase in the real interest rate copyright 1994 by ohio state university press

the real estate markets players institutions and territories revealing the parties the processes and the institutions and consequently both the diversity and contingency of the real estate markets the existing increasing literature emphasises the contemporary numerous links and interdependencies between real estate land value planning and town planning policy and even the financial system this paper is an attempt to understand all the real estate markets from the most peripheral ones where the urban rent is the lowest to the most dense city centres to gain a better understanding of the real estate market a process of firstly deconstruction and then reconstruction is used the process of deconstruction involves identifying various market trends according to property type principally residential buildings players and institutions territorial situations and temporalities based on research conducted in switzerland we then developed a meta synthesis inspired by fernand braudel whose works put as much emphasis on day to day economic activity as on long term activity and on local as well as global issues

the routed inventory pooling problem with three non identical retailers abstract we consider a single period inventory problem with three non identical retailers in which items can be pooled at a predetermined point in time since multiple items are often pooled with a single visit to each retailer we use a predetermined shortest route for redistribution we derive cost expressions for this routed pooling policy as well as for the no pooling and complete pooling policies which serve as benchmarks in a numerical investigation we analyze how much of the pooling benefits can be captured if the route for redistribution is fixed furthermore we investigate how stock is distributed among retailers at the beginning of the period and we look into the influence of a retailer s size and position in the route on expected costs

public budgetary rules and gdp growth an empirical study on oecd and twelve european countries we study the long term effects of budgetary rules on gdp growth rate and analyse the determinants of the short term gdp growth dynamics for both a sample of 19 oecd and a subsample of 12 european countries we show that in the long run improvements in the cyclically adjusted budget balance as well as increases in the tax burden have negative effects on gdp growth the highest effect of fiscal policy on gdp growth would be obtained if the structural deficits were used to increase the market size by reducing the tax burden in line with barro 1990 a deficit financed reduction of tax burden has a stronger effect for european than for oecd countries because in europe the government size with respect to market size is too large therefore if gdp growth is a dominant policy objective in europe specific actions should redress the 2012 treaty toward a reduction of the tax burden

filling potholes macroeconomic effects of maintenance versus new investments in public infrastructure abstract the maintenance of existing public infrastructure has often been neglected in favor of building new infrastructure in developing countries this paper develops a dynamic general equilibrium model that analyzes the reasons and effects of such neglect first the optimal level of maintenance is shown to depend on the size of new investments as a share of existing public infrastructure and on the productivity of infrastructure second the model is parameterized and solved numerically for a sample of latin american countries quantitative results show that reallocating funds from new infrastructure to maintenance can have positive effects on these countries gdp

institutions in british property research a review this paper surveys approaches to the study of institutions as used in recent commercial property research in britain institutional analysis can be approached from mainstream economics power str

land use planning and the housing market a comparative review of the uk and the usa this paper provides a review of some of the key articles and research examining the relationship between planning regulation and its impact on the housing market in the uk and the us in both count

housebuilder networks and residential land markets the commercial prospects of speculative housebuilders depend crucially on successful land acquisitions this paper presents new evidence revealing the importance housebuilders attach to networks with other important actors in securing future land supplies since networks depend on trust reputation and voluntary collaboration they indicate the importance of social relations within the industry the paper argues that uk speculative housebuilders rely more on networks than markets to source land and that they structure those networks to enhance their own competitive positions reflecting granovetter s belief in the strength of weak ties the paper emphasises the breadth not depth of housebuilder networks and contends that social relations within the industry are primarily dependent on pragmatic considerations of mutual self interest

macroeconomic policies growth and welfare in a stochastic economy an integrated stochastic equilibrium growth model is constructed and directed to various questions pertaining to monetary and tax policy two main issues addressed include 1 the tradeoff between the rate of capital accumulation and inflation in a stochastic environment and 2 economic welfare and optimal policy making the key result is that policy variables impact on welfare through their effect on the after tax nominal interest rate which therefore serves as an intermediate policy target the welfare maximizing interest rate target is derived and the author discusses its attainment through appropriate monetary and tax policies tradeoffs between policy instruments are also addressed copyright 1993 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

scale congestion and growth this paper explores the relationship between aggregate and relative congestion returns to scale and economic growth aggregate congestion reduces the effective productivity of capital relative congestion reduces the effective productivity of labour both forms of congestion adversely affect the equilibrium growth rate although their relative effects depend upon aggre gate returns to scale the two forms of congestion have contrasting effects on the transitional dynamics relative congestion retards the rate of adjustment aggregate congestion accelerates it the externalities generated by congestion and non optimal expenditure can be fully cor rected both during the transition and in steady state by a time invariant income tax the role of public expenditure as an instrument of economic growth has been a major policy issue as governments throughout the world design stimulus packages as in japan and face difficult choices to meet the emu criteria in europe empirical research investigating the impact of public investment on the productivity of private capital and output was stimulated by aschauer 1989a b who found the effects to be strongly positive the nature of public investment is however diverse in general public goods vary extensively in terms of the nature of their services spanning the range between the polar cases of pure private and pure public goods but the treatment of public expenditures in formal growth models is limited barro 1990 and futagami et al 1993 treat government expenditure as a pure pub lic good and in so doing they fail to take account of the congestion typically associated with public goods however as barro and sala i martin 1992 have argued almost all public services are characterized by some degree of congestion so that the pure public good should be viewed as only a bench mark these considerations suggest that congestion is an important consider ation in assessing the effect of public expenditures on economic growth attempts to analyse the effects of congestion on economic growth have been limited in various dimensions drawing on the public goods literature edwards 1990 proposes a number of specifications of congestion two notions particularly relevant in a growth context are relative congestion and aggregate absolute congestion the former specifies the level of services derived by an individual from the provision of a public good in terms of the usage of his individual capital stock relative to the aggregate capital stock aggregate congestion sometimes called crowding indicates how aggregate usage of the service alone influences the services received by an individual 2 existing applications of congestion to growth theory introduce it into ak models see barro and sala i martin 1992 1995 glomm and ravikumar 1994 1997 and turnovsky 1996 1997 however the ak model features two limitations that restrict its flexibility to examine the relationship between congestion and growth first as solow 1994 pointed out sustained ongoing

productive government expenditures and long run growth the purpose of this paper is to review some of the recent developments in endogenous growth models specifically our focus is on the growth effects of productive government spending in dynamic general equilibrium models we use a simple overlapping generations model as our basic framework and illustrate the role of taxes and spending we then examine several related issues nonrivalry in publicly provided goods existence and uniqueness of competitive equilibrium endogenous public policy ways of financing public expenditures composition of publicly provided goods and services and private alternatives finally we review some empirical results related to output elasticity of public capital and educational expenditures

does land property structure affect local development patterns evidence from a greek tourist area this paper attempts to clarify the institutional context and local framework of landed property relations in the local development patterns of a rural space converted into an urban tourist resort on the island of rhodes greece through the diachronic analysis of cadastral data on land property ownership and non market land property transfers and acquisitions direct and indirect state policies land property structures inherited from the past formal and informal institutions enabled agents to establish enterprises of varying types and size socially dispersed landownership is a structural resource that through agency influences local development patterns and land property is repeatedly implicated in the local production and reproduction system

stocking decisions for low usage items in a multilocation inventory system this research shows that organizations with a number of sister plants warehouses or other stocking points can profit from the concept of proactive use of transshipments as an element of their inventory control policy for certain types of parts employing transshipments can significantly reduce the total inventory needed throughout the entire collection of stocking points the study is motivated by a real life situation involving a large utility company having 29 power generating plants in five southeastern states where there are thousands of parts that are commonly used at multiple plants at present each plant operates independently and maintains enough stock to meet its own requirements transshipments take place between plants whenever there is an emergency requirement for a part but no explicit consideration is given to this effect while deciding on stocking levels at different plants in the case we examined by setting stocking levels to explicitly take account of transshipments total system cost could be reduced by about 70 over the company s decentralized policy in general this work considers a single echelon n location continuous review inventory system in which complete pooling of stock is permitted among the locations a model is developed for slow moving expensive and consumable parts that are common to two or more locations a one for one ordering policy and queueing theory allow development and solution of a system of equations for the probability distribution of net inventory at each location a heuristic procedure is also developed to determine cost effective stocking levels actual data from the utility company are used to demonstrate the applicability of the model savings achieved as a result of pooling are reported

is infrastructure capital productive a dynamic heterogeneous approach this paper offers an empirical evaluation of the output contribution of infrastructure drawing from a large data set on infrastructure stocks covering 88 countries and spanning the years 1960 2000 and using a panel time series approach the paper estimates a long run aggregate production function relating gdp to human capital physical capital and a synthetic measure of infrastructure given by the first principal component of infrastructure endowments in transport power and telecommunications tests of the cointegration rank allowing it to vary across countries reveal a common rank with a single cointegrating vector which is taken to represent the long run production function estimation of its parameters is performed using the pooled mean group estimator which allows for unrestricted short run parameter heterogeneity across countries while imposing the testable restriction of long run parameter homogeneity the long run elasticity of output with respect to the synthetic infrastructure index ranges between 0 07 and 0 10 the estimates are highly significant both statistically and economically and robust to alternative dynamic specifications and infrastructure measures there is little evidence of long run parameter heterogeneity across countries whether heterogeneity is unconditional or conditional on their level of development population size or infrastructure endowments

alternative government financing and stochastic endogenous growth abstract this paper addresses a stochastic endogenous model in which the stock of securities both money and bonds are required to finance the government budget we study how the expected rate of real growth the expected inflation rate and economic welfare are influenced by changes in the first and second moments of public spending the analyses will enable us to assess the merits and demerits of mixed financing case of money and bonds relative to financing one of taxes on wealth examined in grinols and turnovsky j econom dyn control 17 1993 1 and turnovsky int econom rev 34 1993 953 in addition we construct a model where government relies on a larger ratio of bonds to money to raise the necessary revenue and show how the consequences of mixed financing are affected by the policy decision of government

institutions in theories of land markets illustrated by the dutch market for agricultural land theories of land markets should be intellectually sound and should be able to explain and predict market outcomes such as price and volume of transactions changes in these and locations of different land uses theories based on neo classical economics which largely ignore the role of institutions are not intellectually sound because it is known that markets cannot work without institutions nor do these theories predict outcomes satisfactorily moreover they assume market mechanisms and do not investigate them critically this paper explores how institutions may be taken into account in theories of land markets and whether that leads to better theories both of market outcomes and of market processes new institutional economics provides the tools to investigate how the interactions between market actors are influenced by institutions and the old institutional economics emphasises how institutions influence the motivations and preferences of those actors the conclusion is that there cannot be a general theory of land markets only theories with a limited applicability and scope such theories can be used to explain the effects of small changes and to predict the effects of marginal changes in institutions in that latter use these theories can be used for designing land policy how institutions can be incorporated into theory is illustrated by analysing the dutch market for agricultural land this shows how institutions affect the outcomes in that market and the consequences for the transformation of land from agriculture to urban use

a transitional institution for the emerging land market in urban china chinese economic reforms since 1978 have been a continuous process of fundamental institutional change the new institution of ambiguous property rights over state owned urban land evolves from the

managing inventories with one way substitution a newsvendor analysis abstract this paper presents an insightful approach to analyze two item periodic inventory systems with one way substitution the objective is to minimize the expected total cost per period which consists of expected purchasing costs expected inventory holding costs expected shortage costs and expected adjustment costs this approach helps derive the optimality conditions in both single period and infinite horizon settings and yields useful insights into the impact of substitution on the service level the optimality of a borderline case in which the order up to level of the inflexible item is reduced to zero and the pivotal role of the purchasing cost

performing housing markets this paper offers an interpretation of how housing markets work which complements more traditional economic approaches building on a wider movement within cultural economy and economic sociology it considers how housing markets are variously performed in the power filled negotiations of buyers sellers and market professionals this is part of a larger undertaking but here the focus is particularly on the role of legal financial and information intermediaries in shaping local cultures of property exchange this is a social rather than economic analysis of housing markets it is a qualitative rather than a quantitative study it is designed to shed light on how markets are made though it might in the end change the way they are modelled

alternative forms of government expenditure financing a comparative welfare analysis this paper derives criteria for evaluating the impact of an increase in government expenditure on both the time path of instantaneous utility and overall welfare under alternative forms of tax financing these consist of three factors the first is the direct crowding out effect which reflects the utility differential between the government expenditure being undertaken and the private consumption it is displacing the second describes the intertemporal trade off between the effect on the short run rate of capital accumulation and the resulting change in the the long run capital stock the final term is due to the distortion arising from the pre existence of a tax on wage income copyright 1992 by the london school of economics and political science

transitional dynamics in two sector models of endogenous growth the steady state and transitional dynamics of two sector models of endogenous growth are analyzed in this paper we describe necessary conditions for endogenous growth the conditions allow us to reduce the dynamics of the solution to a system with one state like and two control like variables we analyze the determinants of the long run growth rate we use the time elimination method to analyze the transitional dynamics of the models we find that there are transitions in real time if the point in time production possibility frontier is strictly concave which occurs for example if the two production functions are different or if there are decreasing point in time returns in any of the sectors we also show that if the models have a transition in real time the models are globally saddle path stable we find that the wealth or consumption smoothing effect tends to dominate the substitution or real wage effect so that the transition from relatively low levels of physical capital is carried over through high work effort rather than high savings we develop some empirical implications we show that the models predict conditional convergence in that in a cross section the growth rate is predicted to be negatively related to initial income but only after some measure of human capital is held constant thus the models are consistent with existing empirical cross country evidence authors

spill over effects of supply side changes in a two country economy with capital accumulation abstract using a two country dynamic optimization model with capital accumulation we explore the effect of such supply side changes as a rise in productivity and a reduction in the corporate tax rate on the equilibrium path and the welfare of two countries the welfare effect consists of a tax distortion term and a wealth term those supply side changes in the creditor country increase its welfare but unambiguously decrease the debtor country s welfare as capital moves from the debtor country to the creditor country

growth versus welfare in a model of nonrival infrastructure abstract the paper constructs a model of endogenous growth where infrastructure acts as an accumulable stock generating a nonrival input service steady state growth paths are studied for market and command economies in the former a final good is produced privately and as in many developing economies infrastructure accumulated on noncompetitive basis by the state the command economy allocates resources by solving a grand optimization exercise the transitionally stable steady growth rate for the market economy dominates the command economy growth rate due to the joint presence of noncompetitive behaviour by the state and noninternalizable externalities

budget balance welfare and the growth rate dynamic scoring of the long run government budget this paper determines conditions under which a reduction in the role of government either through a tax cut alone or together with accompanying expenditure cuts will improve long run government fiscal balance for a ceteris paribus cut in the income tax rate to improve long run government balance the intertemporal elasticity of substitution must exceed unity a tax cut balanced by an expenditure cut is likely to improve the long run balance even if it does not improve the short run balance the relationship between improving the long run fiscal balance and economic welfare is also analyzed

infrastructure provision and macroeconomic performance this paper studies the differences between private and government provision of infrastructure capital utilization decisions and their differential role in determining market prices for capital goods under the two regimes of infrastructure provision serve as a critical transmission mechanism for fiscal policy a subsidy to private providers of infrastructure is preferable to direct government provision irrespective of how the subsidy or expenditure is financed the case for private provision is much stronger in economies characterized by high levels of congestion the choice between private and government provision also has a crucial effect on the design of optimal fiscal policy 2011 elsevier b v all rights reserved

public investment congestion and private capital accumulation this paper analyses the impact of public investment on the dynamics of private capital formation in an intertemporal optimising market clearing framework the key feature characterising the analysis is that the public good is treated as a durable capital good subject to congestion we show how in the presence of congestion the effect of government investment on private capital formation involves a tradeoff between the degree of substitution between private and public capital in production and the degree of congestion both lump sum and distortionary tax financing are considered with this tradeoff being tightened in the latter case

excludable and non excludable public inputs consequences for economic growth non excludable and excludable public inputs are introduced into an endogenous growth model we derive the equilibrium growth rate and design the optimal tax and user cost structure emphasizing the role of congestion and its consequences for the government s budget the latter comprises fee and tax revenues that are used to finance the public inputs although they may generate insufficient revenue to do so entirely we extend the model to allow for monopoly pricing of the user fee by the government most of the analysis is conducted for general production functions consistent with endogenous growth but the ces technology is also considered a vast literature has evolved emphasizing the role of public investment as a determinant of economic growth among the earliest contributions arrow and kurz 1970 is particularly significant while the seminal work of barro 1990 has been especially influential with respect to the contemporary endogenous growth literature stimulated by aschauer s 1989 findings pertaining to the high rate of return on public capital several authors have explored various aspects of the role of public capital in stimulating economic growth for example baxter and king 1993 and fisher and turnovsky 1998 examine the interaction between public and private capital in a ramsey type growth model while futagami et al 1993 perform a similar type of analysis in an endogenous growth context glomm and ravikumar 1997 analyse the growth effects of productive public spending in an overlapping generations setup extending the framework to include majority voting and alternative compositions of publicly provided goods and services they also indicate private alternatives to public provision but do not pursue this in detail cassou and lansing 1998 focus on the relationship between private and public capital showing how the evolution of the ratio between the two in the us economy since 1925 is broadly consistent with the predictions of a simple ramsey growth model they also show how the productivity slowdown in the us economy since the 1970s is more likely due to increasing tax rates than to non optimal public investment policy much of the literature including barro treats the public input as a pure public good freely available without restrictions or impediments to all agents in the economy but the public goods literature identifies many different characteristics that most public goods in fact exhibit notably the presence of rivalry and or excludability see e g cornes and sandler 1996 thus the treatment of a public

anticipated inflation and the capital stock in a cash in advance economy abstract an economy is constructed in which the steady state capital stock is inversely related to the rate of inflation as a result that is directly opposite the usual conclusion

is public expenditure productive abstract this paper considers the relationship between aggregate productivity and stock and flow government spending variables the empirical results indicate that i the nonmilitary public capital stock is dramatically more important in determining productivity than is either the flow of nonmilitary or military spending ii military capital bears little relation to productivity and iii a core infrastructure of streets highways airports mass transit sewers water systems etc has most explanatory power for productivity the paper also suggests an important role for the net public capital stock in the productivity slowdown of the last fifteen years

public spending endogenous growth and endogenous fluctuations abstract this article studies indeterminacy and endogenous growth in a simple one sector model of capital accumulation endowed with inelastic labor supply in which the presence of public goods creates positive externalities both in the production and the consumption sectors because of increasing returns in the utility function the economy exhibits not only perpetual growth but also indeterminacy and therefore endogenous stochastic growth fluctuations the possibility of sunspot equilibrium growth paths is shown to be consistent with plausible parameter values journal of economic literatureclassification numbers e32 o41 h40

reprint to infrastructure provision and macroeconomic performance abstract this paper studies the differences between private and government provision of infrastructure capital utilization decisions and their differential role in determining market prices for capital goods under the two regimes of infrastructure provision serve as a critical transmission mechanism for fiscal policy a subsidy to private providers of infrastructure is preferable to direct government provision irrespective of how the subsidy or expenditure is financed the case for private provision is much stronger in economies characterized by high levels of congestion the choice between private and government provision also has a crucial effect on the design of optimal fiscal policy

growth outside the stable path lessons from the european reconstruction abstract this paper exploits a natural experiment the large destruction of capital in continental europe during world war ii to characterize the transitional dynamics of an economy that begins with a capital stock below its steady state level we use these regularities as a benchmark to discriminate among competing growth specifications a model that combines non separabilities in preferences with a technology that restricts the degree of substitutability between inputs outperforms the widely used ak and cobb douglas specifications with time separable preferences our results suggest that policy evaluations based in growth models that overlook non separabilities in preferences or impose strong restrictions on the technological structure might be grossly misleading

optimal policies for inventory systems with lateral transshipments using lateral transshipments can be beneficial in order to improve service levels and to reduce system costs this paper deals with a single echelon inventory system with two identical locations demands are generated by stationary and independent poisson processes in general if a demand occurs at a location and there is no stock on hand the demand is assumed to be backordered or lost however in this paper lateral transshipments serve as an emergency supply in case of stock out in this paper the rule for lateral transshipments is given while the ordering policies for normal replenishments are optimized the transshipment rule is to always transship when there is a shortage at one location and stock on hand at the other first we assume that the locations apply r q policies for normal replenishments and show that the optimal policies are not necessarily symmetric even though the locations are identical this means that one cannot in general assume that the optimal policy is symmetric under symmetric assumptions second we relax the assumption of r q policies and derive the optimal replenishment policy using stochastic dynamic programming

the transitional dynamics of fiscal policy long run capital accumulation and growth this paper analyzes the effects of fiscal policies in a non scale growing economy with public and private capital the equilibrium dynamics are characterized and we contrast the dynamic effects of government expenditure on investment and expenditure on consumption under four alternative modes of tax financing most of our attention focuses on the numerical simulations of a calibrated economy the results emphasize the lengthy transition periods which implies that policies have sizeable level effects leading to substantial welfare effects even though long run growth rates are unaffected the paper highlights the intertemporal dimensions of fiscal policy and the tradeoffs these involve for economic performance especially growth and welfare

infrastructure alternative government finance and stochastic endogenous growth abstract this paper constructs a stochastic version of an endogenously growing economy with a public good that raises the productivity of private capital we explore how growth and welfare are influenced by changes in the mean and variance of productive public spending under two alternative financing methods mixed money bond financing and wealth tax financing in addition to evaluate the differences between money financing and bond financing we consider mixed money bond financing under which a larger ratio of bonds to money is utilized to finance a given increase in public spending

optimal taxation of capital income in general equilibrium with infinite lives this paper analyzes the optimal tax on capital income in general equilibrium models of the second best agents have infinite lives and utility functions which are extensions from the koopmans form the population is heterogeneous the important property of the models is the equality between the social and the private discount rates in the long run i find that the optimal tax rate is zero in the long run for a special case of additively separable utility functions i then determine the tax rates along the dynamic path and conditions that are sufficient for the local stability of the steady state

optimal and approximate policies in multiperiod multilocation inventory models with transshipments this paper examines the effects on the optimal ordering policy and its cost of allowing for interactions among retail outlets specifically transshipments are allowed as recourse actions occurring after demands are realized but before they must be satisfied the resultant savings in holding and shortage costs are balanced against the costs of transshipment a base stock ordering policy is optimal for this model if the final period base stock order up to point is nonnegative then it will be the base stock order up to point for all periods unfortunately it can be found analytically only for two special cases where either the cost parameters are equal at every outlet or there are only two outlets these two special cases are used to validate a heuristic solution technique employing monte carlo integration which is then compared to an easily calculated base policy in order to gauge the contribution of this model the additional savings from using this heuristic policy are significant particularly for problems with many retail outlets and low transshipment costs

a theoretical framework for the functioning of the dutch property market in this article a theoretical framework will be presented to aid understanding of the functioning of property markets more particularly the dutch property market it will be argued that traditional urban economic theories are not able to explain the structure and processes of the built environment in the dutch case we are confronted with two problems first to find a way in which urban economic theories designed for a context of cities in great britain and the us can be used to explain urban development that takes place in the different context of dutch cities and secondly to formulate a set of hypotheses appropriate for the dutch property market the hypotheses concern the strategies of individual actors on the property market and the underlying factors it is concluded that in general the relation between institutional structure and property development has been neglected both because of insufficient attention from economic scientists and because empirical research is very complicated

the composition of government expenditure and its consequences for macroeconomic performance abstract this paper employs the intertemporal optimizing market clearing framework to compare the effects of government consumption expenditure and government infrastructure expenditure on macroeconomic adjustment and performance particular attention is focused on the time path of the capital stock and its adjustment to both permanent and temporary changes in government expenditure are considered we show how the effects of both forms of government expenditure on economic welfare can be broken down into 1 i a direct crowding out effect and 2 ii a second component which describes the intertemporal tradeoffs between the short run rate of capital accumulation and the resulting change in the capital stock

an inventory model with unidirectional lateral transshipments this paper deals with a continuous review inventory system with poisson demand in which lateral transshipments are allowed in case of a shortage at a location another location acts as a supplier if it is possible a common assumption in earlier papers is that transshipments are allowed between all locations this network configuration may however not be the best choice for many reasons one such reason is that it may be difficult to establish contracts between locations regarding the design of the transshipment policy another reason is that a system with many transshipment links is much more complex than a system with few transshipment links in this paper we study a system where transshipments are allowed only in one direction this may be a reasonable policy if the locations have very different backorder lost sales costs our approach is relatively simple and fast and works well in most cases

the speed of convergence and alternative government financing abstract in this paper we are concerned with the speed of convergence in the sidrauski monetary optimizing model sidrauski am econ rev 57 1967 534 in which the steady state capital stock is not influenced by a change in public spending the paper studies how different the speed of convergence to the steady state is affected by a change in government spending under the various ways of financing in exploring the transitional adjustment to the public policy shock it will be convenient to focus upon the degree of relative risk averse

emergency lateral transshipments in a two location inventory system with positive transshipment leadtimes abstract we consider a single echelon continuous review inventory system for spare parts with two parallel locations each location faces independent poisson demand and backorders are allowed in this paper we consider the possibility of lateral transshipments between the locations the transshipment leadtime is positive and deterministic and there is an additional cost for making a transshipment we suggest a transshipment policy which is based on the timing of all outstanding orders and develop and solve a heuristic model by using theory and concepts from doubly stochastic poisson processes and also partial differential equations a simulation study indicates that our heuristic works very well and that the relative cost increase of disregarding the transshipment leadtime may be quite high our results also indicate that it is in general worth the effort of reducing the transshipment leadtime even if it is already relatively short

inventory sharing and rationing in decentralized dealer networks an increasing number of manufacturers have started to pursue a strategy that promotes inventory sharing among the dealers in their distribution network in this paper we analyze a decentralized dealer network in which each independent dealer is given the flexibility to share his inventory we model inventory sharing as a multiple demand classes problem in which each dealer faces his own customer demand with high priority and inventory sharing requests from other dealers with low priority assuming that each dealer uses a base stock and threshold rationing policy for his inventory stocking and inventory sharing decisions we explicitly model the interactions between the dealers through inventory sharing and obtain aclosed form cost function for each dealer based on the steady state distribution of the inventory levels at the two dealers we then provide a detailed supermodularity analysis of the inventory sharing and inventory rationing game in which each dealer has a two dimensional strategy set stocking level and rationing level we show that the full sharing game in which dealers precommit to sharing all of their on hand inventory and the fixed sharing level game in which dealers precommit to sharing a portion of their on hand inventory are supermodular and thus a pure strategy nash equilibrium is guaranteed to exist for the rationing game in which dealers precommit to their stocking levels we show that there exists a dominant strategy equilibrium on the dealers sharing rationing levels finally a comprehensive computational study is conducted to highlight the impact of the manufacturer s incentives subsidies and or transshipment fees on the dealers sharing behavior

dynamic analysis of an endogenous growth model with public capital this paper develops an endogenous growth model with productive public capital along with private capital in a spirit similar to that of r j barro 1990 since the authors model includes two stock variables it has transitional dynamics unlike most of the previous studies on endogenous growth including barro s where concerns are restricted to the steady state analysis first they show that the transitional path is unique and stable second the character of the transitional path is explored third the authors show that the optimal tax rate is smaller than the rate that maximizes the national growth rate with a log linear utility function copyright 1993 by the editors of the scandinavian journal of economics

a semi markov model with holdout transshipment policy and phase type exponential lead time in this paper a semi markov decision model of a two location inventory system with holdout transshipment policy is reviewed under the assumption of phase type exponential replenishment lead time rather than exponential lead time the phase type exponential lead time more closely approximates fixed lead time as the number of phases increases unlike past research in this area which has concentrated on the simple transshipment policies of complete pooling or no pooling the research presented in this paper endeavors to develop an understanding of a more general class of transshipment policy in addition we propose an effective method to approximate the dynamic holdout transshipment policy