duopoly supergames with product differentiation abstract when goods are complements or very close substitutes more tacit collusion is supported by trigger strategies in price setting supergames than in quantity setting supergames for moderate or poor substitutes the situation is reversed this contrasts with the static situation where price setting strategies always lead to higher welfare

innovative and noninnovative small firms types and characteristics this study addresses the proposition that the characteristics of innovative and noninnovative small firms have significant differences it is based on a sample of 50 texas manufacturers cluster analysis yielded five distinct groups two innovative and three noninnovative the two innovative groups were either young firms dubbed the young turks or established managerially competent firms headed by newcomers called the blue chips among the three noninnovative groups the silver spoons appeared to be surviving on past success the striving stoics displayed continuing managerial effort but were led by executives who had been at the helm far longer than average and the kismets showed lesser competence and effort were highly centralized and were headed by executives tending more towards an external locus of control correlational analysis indicated a significant positive relationship between scanning and innovation challenges to the firm in the form of environmental dynamism and heterogeneity evoked positive innovatory responses but environmental hostility was a weak negative correlate inducing the firm to pull in its horns finally an abundance of resources encouraged proactiveness

a theory of disagreement in repeated games with bargaining this paper proposes a new approach to equilibrium selection in repeated games with transfers supposing that in each period the players bargain over how to play although the bargaining phase is cheap talk following a generalized alternating offer protocol sharp predictions arise from three axioms two axioms allow the players to meaningfully discuss whether to deviate from their plan the third embodies a theory of disagreement that play under disagreement should not vary with the manner in which bargaining broke down equilibria that satisfy these axioms exist for all discount factors and are simple to construct all equilibria generate the same welfare optimal play under agreement generally requires suboptimal play under disagreement whether patient players attain efficiency depends on both the stage game and the bargaining protocol the theory extends naturally to games with imperfect public monitoring and heterogeneous discount factors and yields new insights into classic relational contracting questions

models for distinguishing innovative and noninnovative small firms the importance of innovation is underscored by the fact that some authors blame u s industry s competitive decline on the excessively short term focus of managers as opposed to longer term innovative product or process development at the same time the contribution of small firms to research and innovation continues to rise thus from 1945 to 1980 they introduced an average 48 share of innovations a figure that rose to 56 for the 1980 1985 period this article studies innovation in small manufacturing firms in texas the study sample was drawn from the 1985 directory of texas manufacturers and covered sic codes 34 39 these include metal fabrication nonelectrical machinery electrical and electronic machinery transportation equipment instrumentation and miscellaneous manufacturing a total of 50 usable responses were received of which the ceo was the responding executive in 38 prior literature on innovation provided the relevant variables in broad groupings these covered strategy structure function environment the firm and the responding executive plus his role in innovation product differentiation and risk taking were also included each broad group often consisted of several variables for example the environment grouping comprised dynamism heterogeneity and hostility in all there were 31 independent variables their data values were based on either the responses to individual questions or the means of responses to groups of questions the dependent variable product service innovation averaged the responses to questions on technological leadership and quantity and quality of innovations a stepwise regression procedure yields an eight variable model with an r2 of 0 66 a runs test on the residuals confirms the randomness of errors the computed discriminant function classifies the sample firms correctly in 43 of 50 cases while the modeling process is successful the models have not been retested on fresh data because of the small sample and so the caveat of sample specificity remains the recurring variables in the two models are integrated decision making environmental heterogeneity percentage of research expenditure to cost of goods sold and the responding executive s role in technical development of innovations for the latter the answer seems to be that less is more or hands off is best the coefficients for the others are all positive for investors or lenders the consequence of being able to evaluate the innovative potential of small firms is likely to attenuate the risk secondarily it is also likely to enhance the efficient allocation of resources the data obtained lacked sufficient variation in structural variables like centralization the sample firms tended to be centralized thus future research exploring centralization and its effect on innovation in small firms would be most interesting particularly as prior results are somewhat ambiguous

price setting supergames with capacity constraints this paper examines the role of industry capacity in enforcing collusion in the context of repeated games for a fixed capacity per firm it is shown that changes in the number of firms have a non monotone effect on the best enforceable cartel price this is due to the fact that while an additional firm lowers the share that each of the other firms enjoys at the collusive price it also increases the losses to each firm should the cartel fail

the toxic intensity of industrial production global patterns trends and trade policy this paper exploits a newly developed data set to investigate recent changes in the international distribution of industrial pollution in particular the authors examine three issues 1 the relationship between the toxic intensity of industrial production and the level of economic development 2 the impact of oecd environmental regulation on global changes in toxic intensity and 3 the relationship between trade policy and the toxic intensity of industrial production in ldc s 10 refs

competitive advantage and collusive optima cost differences may often be important in real oligopolies if side payments are impossible the standard cartel objective total industry profits lacks plausibility when costs differ this essay considers plausible alternatives four different technologies for effecting collusion which are essentially identical when costs are equal define sets of possible profits axiomatic bargaining models are used to select unconstrained optima from among these possibilities simple functional forms are employed low cost firms with large shares in cournot equilibrium may have little to gain from collusion if collusion is effective low cost firms will have relatively low estimated conjectural variations

technological accumulation diversification and organisation in uk companies 1945 1983 a survey of more than 4 000 significant innovations and innovating firms in the uk from 1945 1983 shows that the scope and organisation of technological activities vary greatly as functions of firms principal activities and size 1 technological opportunities and threats are greatest in firms in chemicals and engineering opportunities in such science based and specialist supplier firms in general emerge horizontally in related product markets and downstream in user sectors in scale intensive e g steel vehicles and supplier dominated e g printing construction firms opportunities tend to be upstream in related production technologies breakthrough innovations in science based firms also induce clusters of technological opportunities upstream for suppliers horizontally for partners and downstream for users their effective exploitation requires diversity of firms technological activities greater than that strictly required for current output 2 the nature of technological opportunities and of organisation for their exploitation also varies with firm size firms with fewer than 1 000 employees have major opportunities with specialised strategies in mechanical engineering and instruments the prevalence of broad front technological strategies and of divisionalisation increases sharply with firm size together with dependence on formal r and d activities the size of innovating divisions has diminished sharply over the period divisionalisation improves the goodness of fit between the core business of innovating divisions and the innovations themselves but 40 have remained consistently outside the core business of divisions 3 these findings help identify the key tasks of technological strategy in firms in different industries and of different sizes thus in large firms divisionalisation can create the small size of unit conducive to effective implementation but it cannot absolve central management from the continuous task of matching technological opportunities with organisational forms and boundaries

business strategies in more and less innovative firms in canada abstract this study investigates differences in the policies being pursued by more innovative and less innovative firms it focuses on a broad group of strategies in marketing finance production management and human resources and asks whether there are key areas in which the strategies being followed by more and less innovative firms differ it also investigates how the activities of firms in each of these areas differ finally it compares the performance of more and less innovative firms the study finds that more innovative firms place a greater emphasis on management human resources marketing financing government programs and services and production efficiencies each of these areas is important finally more innovative firms are more successful than less innovative firms

cartels profits and excess capacity a model of a collusive duopoly in which each firm has limited capacity is studied the negotiated output quotas depend on the bargaining power of the firms which derives from the damage the firms can do by cutting prices for fixed capacities the unit profit of the small firm is at least as large as that of the large firm and the relative position of the small firm is better when demand is low when the capacities can be chosen once and for all there is excess capacity in equilibrium so long as the cost of capacity is not too high copyright 1987 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

a comparison of the dynamics of industrial clustering in computing and biotechnology abstract this paper compares the dynamics of the process by which industrial clusters emerged in the us computing and biotechnology industries it examines whether new companies are attracted by industry strength in particular sectors or by the strength of the science base at particular locations in biotechnology it also compares the growth of incumbent firms in the two industries and asks whether growth is boosted by being within a cluster the paper finds that within computing there are some important cross sectoral effects on entry while in biotechnology these cross sectoral effects are more limited in biotechnology the science base plays an important role in promoting entry the growth of incumbent firms in both industries is promoted by strength in the company s own sector and cross sectoral effects and the role of the science base are negligible

environmental kuznets curves real progress or passing the buck abstract recent research has examined the hypothesis of an environmental kuznets curve ekc the notion that environmental impact increases in the early stages of development followed by declines in the later stages these studies have focused on the relationship between per capita income and a variety of environmental indicators results imply that ekcs may exist for a number of cases however the measures of environmental impact used generally focus on production processes and reflect environmental impacts that are local in nature and for which abatement is relatively inexpensive in terms of monetary costs and or lifestyle changes significantly more consumption based measures such co2 emissions and municipal waste for which impacts are relatively easy to externalize or costly to control show no tendency to decline with increasing per capita income by considering consumption and trade patterns the author re examines the concept of the ekc and proposes the use of alternative consumption based measures of environmental impact the author speculates that what appear to be improvements in environmental quality may in reality be indicators of increased ability of consumers in wealthy nations to distance themselves from the environmental degradation associated with their consumption

the nash bargaining solution is optimal abstract we consider the problem faced by players in a two person bargaining game who have different opinions about what is the appropriate solution concept to use a procedure is proposed to resolve such a conflict and it is shown that the nash bargaining solution constitutes the unique equilibrium of the game induced by the procedure as a by product we obtain that in the axiomatic characterization of the nash solution the controversial independence of irrelevant alternatives axiom can be replaced by a much weaker recursivity axiom which amounts to requiring independence of alternatives that cannot be obtained as an outcome of a risk sensitive solution

manufactured exports and terms of trade of developing countries evidence from sri lanka terms of trade implications of diversification into manufactured exports in a traditional primary exporting country are examined in the light of the sri lankan experience over the past two decades the empirical analysis focuses on trends in both commodity and income terms of trade employing a methodology which takes care of the spurious regression problem the results suggest that contrary to the new terms of trade pessimism export diversification has brought about significant terms of trade gains for the sri lankan economy overall the study casts doubt on the robustness of results coming from analyses of price trends in aggregate manufactured exports and calls for systematic time profile analyses of the countries which have achieved significant export diversification in order to inform the policy debate

sectoral patterns of technical change towards a taxonomy and a theory abstract the purpose of the paper is to describe and explain sectoral patterns of technical change as revealed by data on about 2000 significant innovations in britain since 1945 most technological knowledge turns out not to be information that is generally applicable and easily reproducible but specific to firms and applications cumulative in development and varied amongst sectors in source and direction innovating firms principally in electronics and chemicals are relatively big and they develop innovations over a wide range of specific product groups within their principal sector but relatively few outside firms principally in mechanical and instrument engineering are relatively small and specialised and they exist in symbiosis with large firms in scale intensive sectors like metal manufacture and vehicles who make a significant contribution to their own process technology in textile firms on the other hand most process innovations come from suppliers these characteristics and variations can be classified in a three part taxonomy based on firms 1 supplier dominated 2 production intensive 3 science based they can be explained by sources of technology requirements of users and possibilities for appropriation this explanation has implications for our understanding of the sources and directions of technical change firms diversification behaviour the dynamic relationship between technology and industrial structure and the formation of technological skills and advantages at the level of the firm the region and the country

the dynamic capabilities of firms an introduction an expanded paradigm is needed to explain how competitive advantage is gained and held firms resorting to resource bas ed strategy attempt to accumulate valuable technology assets and employ an aggressive intellectual property stance however winners in the global marketplace have been firms demonstrating timely responsiveness and rapid and flexible product innovation along with the management capability to effectively coordinate and redeploy internal and external competences this source of competitive advantage dynamic capabilities emphasizes two aspects first it refers to the shifting character of the environment second it emphasizes the key role of strategic management in appropriately adapting integrating and re configuring internal and external organizational skills resources and functional competences toward changing environment 3 only recently have researchers begun to focus on the specifics of developing firm specific capabilities and the manner in which competences are renewed to respond to shifts in the business environment the dynamic capabilities approach provides a coherent framework to integrate existing conceptual and empirical knowledge and facilitate prescription this paper argues that the competitive advanis tage of firms stems from dynamic capabilities rooted in high performance routines z operating inside the firm embedded in the firm s processes and conditioned by its history it offers dynamic capabilities as an emerging paradigm of the modern business j firm that draws on multiple disciplines and advances with the help of industry studies in the usa and elsewhere

embodied pollution in trade estimating the environmental load displacement of industrialised countries abstract the present paper sets out to aid in the development of environmental load displacement indicators developing the notion of the environmental memory of physical flows we estimated embodied pollution in trade of 18 industrialized countries with a the rest of the world and b developing countries from 1976 to 1994 we found that in the last years of analysis total imports of japan usa and western europe have entailed in general larger air pollutant emissions than local exports the balance of embodied emissions in trade beet seems to follow an inverted u shape across time in japan and western europe and an n shape in the us in the period of analysis japanese and european environmental terms of trade with developing countries improved from the japanese and european point of view whereas american environmental terms of trade with developing countries deteriorated over time although there is no statistical trend between income and embodied emissions in imports in a cross section analysis there does seem to be a positive relationship between both variables at a national level the results suggest that despite many shortcomings this type of assessment may shed useful insights on the international aspects of sustainable development

optimal cartel trigger price strategies abstract a dynamical model of industry equilibrium is described in which a cartel deters deviations from collusive output levels by threatening to produce at cournot quantities for a period of fixed duration whenever the market price falls below some trigger price in this model firms can observe only their own production level and a common market price the market demand curve is assumed to have a stochastic component so that an unexpectedly low price may signal either deviations from collusive output levels or a downward demand shock

testing a model of technological trajectories abstract in this paper we test a model of technological trajectories quantitative predictions are based on some qualitative statements described in pavitt s taxonomy research policy 1984 13 343 373 the test concerned both the realism of the predicted associations between industrial sectors and patterns of technical change and the predictive power of the model the data come from central statistical office of italy istat national research council of italy cnr a survey on technological innovation in the italian manufacturing industry the results of the test do not seem inconsistent with the model s predictions although one of them turned out to be of little significe from a statistical standpoint the variability of innovative behaviour at firm level is confirmed once again thus making more challenging the task of those searching for useful theories on industrial patterns of technological innovation

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

ringleaders in larger number asymmetric cartels the concept of a cartel ringleader has specific legal meaning but has received relatively little attention in the economic literature of cartels this article draws on a sample of 89 european cartels to identify how often ringleaders exist who they are and what they do it argues that ringleaders are more likely where the traditional cartel problems are likely to be most acute i e with larger numbers of members exhibiting substantial size asymmetries this is confirmed for price fixing and bid rigging cartels and is especially pronounced where the ringleader displays aggressive as opposed to merely organisational behaviour

international trade and the sustainability footprint a practical criterion for its assessment a simple and minimal criterion for sustainability is that the value of natural capital plus manufactured capital be not decreasing on the basis of any individual country or region the above simple comparison may be misleading as it does not take account of the production of goods for consumption in other countries regions via international trade in other terms the full environmental footprint of a country may not be properly assessed a method of calculating a weak sustainability criterion has been established for both a closed economy approach and an open economy approach there are significant differences between the open and closed economies measures for several regions particularly the middle east overall global sustainability on this criterion has been positive and increasing using a difference equation approach a further analysis has been made of the average proportional rate of change of global sustainability between 1980 and 1990 and its various regional and structural components have been determined these indicate that most of global sustainability growth can be attributed to western europe other asia and japan particularly through high savings ratios the usa on the other hand has made a very small net contribution to the growth in global sustainability

ecologically unsustainable trade abstract international trade although balanced in monetary terms may be unequal in terms of the exchange of biomass and sink capacity it may also be unilaterally or mutually unsustainable if it implies the overuse of the biocapacity in either one or both of the trading partners in this article the ecological footprint concept is used to distinguish different types of ecologically unsustainable trade but the issue of the possible effects of trade on the ecological footprints is also raised we distinguish four such effects an allocative effect an income effect a rich country illusion effect and a terms of trade effect since international trade can be a subtle mechanism by which ecological sustainability is preserved locally by means of importing biomass and sink capacity from other countries it can also blur the view of responsibility for the ecological effects of production and consumption at the end of this article some ethical and political dilemmas related to these issues are raised

a non cooperative bargaining game with risk averse players and an uncertain finite horizon abstract for an alternating offer bargaining game with an uncertain horizon the equilibrium payoff to a player is greater the less risk averse is he relative to his opponent as the horizon becomes infinite in length the equilibrium partition converges to the nash bargaining solution

capital theory and the measurement of sustainable development an indicator of weak sustainability the measurement of sustainable development is not without considerable difficulties yet this should not detract from the positive advances that can be made in this direction in this paper we present one form that a weak sustainability indicator can take derived from a simple but intuitive savings rule it incorporates the idea that the level of overall capital stock should be non decreasing although subject to qualification at this stage some interesting results emerge from the application of the rule to 18 countries

quantifying the coordinated effects of partial horizontal acquisitions abstract recent years have witnessed an increased interest by competition agencies in assessing the competitive effects of partial acquisitions we propose an empirical structural methodology which can deal with settings involving all types of owners and ownership rights to quantify the coordinated effects of partial horizontal acquisitions on differentiated products industries by evaluating the impact of such acquisitions on the minimum discount factors for which coordination can be sustained we also provide an empirical application of the methodology to several acquisitions in the wet shaving industry that give rise to cross and common ownership structures the results are as follows i the incentives to coordinate of the firms that the acquiring party is pre acquisition able to influence are non decreasing with any acquisition ii the incentives to coordinate of the acquired firm are non decreasing with acquisitions involving full or partial both financial and corporate control rights but non increasing with acquisitions involving full or partial solely financial rights and iii the incentives to coordinate of the remaining firms in the industry are non increasing with any acquisition this implies that the coordinated effects of partial horizontal acquisitions are in general ambiguous which illustrates the importance of an empirical structural methodology

price vs quantity competition in oligopoly supergames abstract in a repeated oligopoly with differentiated products and firms following trigger strategies quantity competition leads to a less efficient outcome than price competition this result contrasts with the repeated duopoly result where price competition is less efficient under certain conditions

dynamic oligopoly behaviour in the airline industry abstract this paper examines the dynamic interaction between united airlines and american airlines on a set of duopoly routes we estimate quarterly conduct parameters or conjectural variations and test constant behaviour bertrand cournot and collusive models we also test two regimeswitching models derived from the green porter price war model one based on reversion to bertrand behaviour during price wars the other on reversion to cournot behaviour the three constant behaviour models are all rejected the regime switching models can both describe the data but the cournot based version is preferred

energy limits on recycling abstract increasing efficiency of resource use is a major ecological economics goal opportunities for large efficiency increases have been found in every area carefully investigated what are the limits energy analysis offers powerful insights ayres has argued that even with unlimited available energy over time it becomes necessary to have ever more dilute waste reservoirs if correct this would significantly limit the potential of a hypothetical sustainable spaceship and of a spaceship economy however we know the world is self contained and long lived and that stable laboratory microcosms have been built thus this assertion appears to violate reality i argue that the alleged problem does not exist given available energy there is no concentration limit on sustainability my result is consistent with the work of georgescu roegen and others i estimate some numerical examples to show that present systems are extremely far from theoretical limits for a long time to come there will be vast opportunities to improve efficiency the paper includes a classification schema for recycling based on chemical bonding and thermodynamic considerations

is the french mobile phone cartel really a cartel abstract france telecom ft sfr and bouygues telecom bt have been fined by france s conseil de la concurrence cc for organizing a mobile phone cartel with stable market shares one half one third and one sixth respectively and for directly exchanging commercial information while not contesting the legal decision it is argued here that the economic reasoning is flawed 1 as the cc made much of the firms stable market shares we have first followed this line of reasoning by considering that the market shares are quotas under uniform costs even if there is a general incentive to form a monopolistic cartel bt was too small for it to be worth its while to join it it is not necessary to exchange information directly to coordinate market shares and prices effectively all partial cartels are unlikely 2 we then departed from the cc by considering that the non uniform market shares are explained by the costs in cournot competition this allows costs to be deduced from the observed market shares by assuming that they are kept the same when switching from cournot competition to any form of cartel we deduced that market shares cannot be other than stable and non uniform any monopoly is unlikely to come about because ft has negative incentives to form a monopolistic cartel no partial cartels of two operators are viable because at least one member would lose out the paper also shows that stackelberg competition is unlikely as well as bertrand edgeworth competition in conclusion cournot competition is the only arrangement that guarantees no losses to all operators

on the role of patience in collusive bertrand duopolies abstract this paper analyzes the role of patience in a repeated bertrand duopoly where firms bargain over which collusive price and market share to implement it is shown that the least patient firm s market share is not monotone in its own discount factor

a model of collusion timing abstract i develop a dynamic model of collusion affording a substantial role to entry heterogeneous firms make collusion entry exit and investment decisions within an evolving environment the collusive agreement adopted is a rule of thumb motivated by the details of collusion in the lysine market it is found that an entrant will wait until it has a market share comparable to its competitors before agreeing to collude allowing for collusive possibilities tends to yield a less concentrated industry with reduced consumer welfare the model characterises events in the lysine market and could provide insights into markets with the potential for collusion and entry and uncertainty about the characteristics of potential entrants

collusion and heterogeneity of firms we examine the impact of heterogeneous discounting on collusion in dynamic bertrand competition we show exactly when collusion can be sustained and how collusion would be organized efficiently with heterogeneous discounting first we show that collusion is possible if and only if the average discount factor exceeds a certain threshold with or without capacity constraints next we identify a dynamic pattern of market share that characterizes efficient collusion and obtain the unique long run prediction despite the presence of multiple equilibria in the long run the most patient firm and the most impatient firm tend to dominate the market

national natural capital accounting with the ecological footprint concept abstract there is a growing consensus among natural and social scientists that sustainability depends on maintaining natural capital however progress to put this ecological condition to practice has been slow not least because of the inability of making these objectives measurable therefore to overcome this obstacle assessment frameworks for natural capital are needed this study presents a simple framework for national and global natural capital accounting it demonstrates using the example of italy an accounting framework which tracks national economies energy and resource throughput and translates them into biologically productive areas necessary to produce these flows this calculation has been applied to over 52 countries with this framework based on the ecological footprint concept human consumption can be compared with natural capital production at the global and national level using existing data

judo economics reconsidered capacity limitation entry and collusion abstract the capacity investment by a new firm into an established market is explored in a repeated price game if the entrant expects collusion to prevail upon entry it may not practice judo economics but instead choose to install enough capacity to serve the entire market this occurs when collusion involves optimal punishment paths if instead collusion is based upon the static nash equilibrium punishment and the incumbent has excess capacity and the entrant is at a cost disadvantage the entrant will strategically limit its capacity so as to restrain the incumbent s price response to entry

measuring sustainability a time series of alternative indicators for scotland this paper presents results from a time series analysis of seven alternative measures of sustainability for scotland the measures chosen are green net national product genuine savings ecological footprint environmental space net primary productivity the index of sustainable economic welfare and the genuine progress indicator these are all measures at the national or macro level we note arguments in the literature that no one single measure of sustainability is likely to be sufficient however very different messages concerning the sustainability of scotland over the period in question 1980 1993 emerge from these measures chosen we also argue that different indicators provide different insights for policy making

profit sharing in a collusive industry abstract we study a model in which collusive duopolists divide up the monopoly profit according to their relative bargaining power we are particularly interested in how the negotiated profit shares depend on the sizes of the firms if each can produce at the same constant unit cost up to its capacity we show that the profit per unit of capacity of the small firm is higher than that of the large one we also study how the ratio of the negotiated profits depends on the size of demand relative to industry capacity and how this ratio changes with variations in demand

managerial efficiency and the schumpeterian link between size market structure and innovation revisited this research uses a unique survey on innovation conducted in belgian high tech industries to investigate a the effects of managerial efficiency on the firm s innovative activity and b the effects of controlling explicitly for managerial efficiency on the schumpeterian like relationship that firm size and market concentration are both conducive to innovation the key findings are managerial efficiency is an important determinant of the firm s innovation performance only when one controls for managerial variables considered as success factors for innovation the schumpeterian effect of the impact of the firm s market share emerges for a wide range of measures of performance which confirms rothwell s suggestion 18 that small firms have a advantage in the management of their innovation

determinants of the adoption of information technology a case study of electrical and electronic goods manufacturing firms in india abstract this study measures the intensity of adoption of information technology it and identifies its determinants in this paper it is argued that the degree of it adoption will be determined by the variables such as entrepreneurship skill intensity government policy openness of economy competitive environment and other firm specific factors the results of ordered probit model suggest that the qualification and information base of entrepreneurs and their attitude towards innovative activities and market share are significant determinants of the degree of it adoption the results also indicate that size of operations and skill intensity of the firms influenced the extent of it use

collusion among asymmetric firms the case of different discount factors abstract this study investigates collusive behavior among asymmetric firms for this purpose we develop a selection criterion for deriving a unique collusive outcome and apply it to the case when firms have different discount factors our analysis reveals that for collusion to be self enforcing it is unnecessary that all firms have sufficiently high discount factors but rather only that firms on average have a sufficiently long run view the optimal collusive outcome entails a strict ordering of output quotas in which firms with relatively low discount factors receive a disproportionate share of market demand as found in the case of a common discount factor a fall in a firm s discount factor reduces the likelihood of successful collusion this effect reduces firm profits on the other hand in the event that firms can collude a lowering of a firm s discount factor increases its output quota so that its profits rise

sources of innovative activities and industrial organization in italy abstract this paper is based on the information gathered through a survey on industrial innovation in 24 000 italian business units two thirds of the business units surveyed declared they had introduced innovations although there were significant variations across industries and size only 16 percent of the innovating business units monitored declared they had performed r d as many as 13 986 business units have introduced innovations without performing r d the paper focuses on the different sources of technical knowledge which support the innovative activities such as r d design acquisition of capital goods patents etc it considers also the relationship between concentration and innovative intensity at the industry level it emerges that at least at the business unit level there is a weak correlation between the two variables on the basis of the measured industrial concentration the propensity to perform product versus process innovations and the sources of technological change a taxonomy of industrial sectors is proposed which elaborates on pavitt s original approach this taxonomy instead of stressing the role of either small firms as in the flexible specialization model or of the schumpeterian concentration to explain the intensity and nature of the innovative phenomena indicates that sectoral differences explain more than is generally believed in understanding technological change efficient innovation policy should therefore be tailored to match those sectoral characteristics

a dynamic oligopoly with collusion and price wars we provide a collusive framework with heterogeneity among jirms investment entry and exit it is a symmetric information model in which it is hard to sustain collusion when there is an activejim that is likely to exit in the near future numerical analysis is used to compare a collusive to a noncollusive environment only the collusive industry generates price wars also the collusive industry offers both more and higherquality products to consumers albeit often at a higher price the positive effect of collusion on variety and quality more than compensates consumers for the negative effect of collusive prices so that consumer surplus is larger with collusion

examining models of collusion the market for lysine abstract we compare the experience with collusion in the market for lysine with the predictions of theory the lysine market provides an ideal setting following the confessions of cartel participants in antitrust investigations data availability allows demand and cost functions to be estimated and observed mark ups compared with predictions we find that several integral aspects of collusion in the lysine market are not adequately addressed in the literature the dynamics associated with entry and investment persistent asymmetries between firms the cartel s bargaining problem and the existence of cheating in equilibrium these issues are likely to have much wider applicability beyond the lysine market

technological trajectories as moderators of firm level determinants of innovation pavitt research policy 13 1984 343 identified different patterns of technological change technological trajectories in four sectoral classes of industrial firms this paper tests the applicability of pavitt s taxonomy which derived from an economic perspective to moderate the inconsistent results of the management literature on the determinants of technological innovation an empirical test in a sample of 105 greek companies showed that firms in different trajectories of pavitt s taxonomy had differences in the rate of technological innovation specialised suppliers and science based firms were found to have higher rates of innovation than supplier dominated and scale intensive ones most importantly different variables proved to be significantly associated with innovation for each category of firms innovation for supplier dominated firms was related to the competitive environment acquisition of information technology strategy risk attitude and internal co ordination for scale intensive firms the important determinants were related to the ability to raise funding and the education and experience of personnel for specialised suppliers innovation was associated with high growth rate and exporting as well as training and incentives offered to the employees to contribute towards innovation science based firms depended upon technology related variables education and experience of personnel growth in profitability and panel discussions with lead customers the application of pavitt s model can resolve the apparent problem of inconsistent results in the management research on the determinants of technological innovation

general equilibrium tax incidence under imperfect competition a quantity setting supergame analysis the incidence of various taxes is analyzed in a model with competitive and oligopolistic sectors friedman s grim trigger strategies support collusion with firms producing output to maximize joint profits subject to the constraint that no firm desires to cheat the sustainable level of output depends on the capitalized value of future retaliation therefore tax induced changes in the net return to capital the discount rate affect the output mix through their impact on the sustainability of collusion this collusive pricing effect is isolated and analyzed one result is that a general factor tax on capital but not labor is shifted

the determination of price and output quotas in a heterogeneous cartel applying a selection criterion that uses both subgame perfection and the nash bargaining solution this paper investigates the relationship between firms cost functions and collusive behavior it is found that the optimal collusive price exceeds the price that the low cost firm would set if it was a monopolist comparative statics reveal that the optimal collusive price is increasing in the low cost firm s unit cost but is decreasing in the high cost firm s unit cost when the cost differential between firms is sufficiently large copyright 1991 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

integration of environmental externalities in international commodity agreements abstract much ecological damage in third world countries is associated with commodity production for the world market competition in commodity markets prevents commodity exporting countries from making the costs of environmental preservation and reconstruction a recurrent element in pricing this article argues that an international commodity agreement ica can be the institutional locus where environmental externalities associated with commodity production can be integrated into a price system such extended or transformed icas are here labeled new international commodity agreements nicas they include a price markup for environmental preservation and reconstruction in commodity producing developing countries this price markup can be levied in the form of an export tax or in the form of a surcharge on import tariffs the conclusion of nicas maybe facilitated by the common fund for commodities which has recently come into operation

the negotiation of sustainable tariffs abstract the governments of two countries explicitly negotiate over a new pair of tariffs as soon as they reach agreement the countries put into effect the agreed upon pair of tariffs which must be self enforcing we investigate how the difference in the two governments patience affects the negotiation results provided that the common optimum tariff is the status quo tariff rate for each country we find that the country with the more patient government gains most from the negotiation if the time lag between a defection and punishment in the implementation phase is short the opposite is true if the response lag in the implementation phase is long

a price setting supergame between two heterogeneous firms when firms attempt to tacitly collude they inevitably face a market sharing problem this problem is further complicated when firms have asymmetries this paper studies a price setting supergame between two firms with different costs the paper investigates sustainability of tacit collusion and solves the market sharing problem under tacit collusion the resulting equilibrium from the supergame is used to study limit pricing government policies toward entrants and welfare change due to technological progress and a change in the time discount rate the paper shows that even costlessly achieved technological progress can decrease social welfare