welfare implications of the transition to high household debt abstract aggressive deregulation of the mortgage market in the early 1980s triggered innovations that greatly reduced indebted households required home equity and a borrowing surge followed this paper uses a calibrated general equilibrium model of lending from the wealthy to the middle class to evaluate the welfare effects of this reform quantitatively we find that the indirect effects of endogenous interest rate and other relative price changes dominate the direct effect of relaxing the constraint the borrowing household s welfare falls even though the reform directly relaxes a constraint on its trade the saving household s welfare rises substantially

motivations for promoting the consumption of green products in an emerging country exploring attitudes of brazilian consumers abstract understanding the motivations that stimulate green consumption can promote environmental thinking to increase demand especially because the current estimated market share for green products is less than 4 worldwide in this scenario emerging countries have contributed to the increasing levels of consumption and environmental effects culture and socio economic status play a significant role in environmental impacts and influences the consumption of green products the current body of literature lacks studies focused on the attitude of brazilian consumers in relation to these products this research evaluates the elements that motivate the consumption of green product a survey targeting individuals who have consumed these products was performed in the largest city in southern brazil data were analyzed using a factorial analysis and a causal structural equation model was created to evaluate the drivers that promote green consumption the elements of information and knowledge environmental attitude social context and environmental consciousness were strongly correlated with green consumption however the quality and price of green products has shown a weaker relationship with consumption these elements indicated that the individuals in the survey recognize and seek information covering environmental issues are concerned with the health effects associated with the consumption of the goods and reject a brand or company that might have demonstrated inappropriate environmental behaviours also indicate that the relation price versus quality does not play a central role in the decision of consuming green products finally information about these products and their point of sale availability were highlighted as enhancing green consumption this outcome suggests that education might increase green consumption this research contributed to understand the main drivers that support the decision about the green products option made for the surveyed sample from a managerial standpoint improvements in ethical transactions the promotion of socially responsible actions the distribution of appropriate information about green products and the structure of the green supply chain could create new businesses focused on sustainable production and consumption the findings of this research could support future policies and actions focused on providing information and knowledge about environmental and health contribution of the green products to the consumers producers companies and society

the disaggregation of corporations selective intervention high powered incentives and molecular units a vast array of organizational innovations and changes are transforming us corporations large firms have dramatically downsized refocused and vertically disaggregated they increasingly obtain goods and services pursue complex development efforts and exploit horizontal synergies without the aid of formal hierarchy large firms are also internally disaggregating into smaller more autonomous units that are treated much like external subcontractors the authors argue that these organizational innovations share an important underlying commonalty economic activity is converging toward exchange involving either internal within firm or external between firm networks of small autonomous production or service units small units and small firms have become the basic building block the molecular units of these new forms further exchange among the small autonomous units is commonly a mix of both market like and hierarchical features the authors develop a theoretical explanation for these trends the

credit supply and the housing boom an increase in credit supply driven by looser lending constraints in the mortgage market is the key force behind four empirical features of the housing boom before the great recession the unpreced

consumer environmental concern and green product purchase in malaysia structural effects of consumption values this study examines the effects of consumption values i e functional value social value emotional value conditional value and epistemic value on malaysian consumers environmental concern as expressed in their purchase of green products it also investigates the differences between three usage groups light average and heavy users and the signi cant factors that promote those differences the study applies a quantitative method in which a structured self administered questionnaire is used data is analysed using the structural equation modelling sem technique via the analysis of moment structure amos computer programme version 21 and one way analysis of variance anova using the statistical package for social sciences spss computer programme version 21 empirical results confirm that social value has the paramount impact on consumers environmental concern as expressed by their purchase of green products and that epistemic value and functional value quality rank behind functional value price emotional value and conditional value have no significant effects statistically significant differences were observed when comparing the light users with average users and with heavy users p 0 05 the findings of this study introduce a new momentum for the preceding discoveries on consumer environmental concern as shown in the purchase of green products which is inadequately covered in the malaysian context they also provide important information for companies and encourage them to place more emphasis on social value epistemic value and functional value quality in their manufacturing in order both to boost environmental concern among consumers in their purchasing decision making and to produce green goods that will be readily liked by consumers

what could promote farmers to replace chemical fertilizers with organic fertilizers abstract to lessen the negative environmental impact of chemical fertilizers replacing chemical fertilizers with more organic fertilizers for famers is a good choice however most of the farmers would like to use chemical fertilizers instead of organic fertilizers in developing countries mainly because they fear that they may lose income if they use organic fertilizers instead of chemical fertilizers from this point policy makers need to find strategies to incentivize farmers to use organic fertilizers instead of chemical fertilizers therefore a randomly selected household survey on the use of chemical and organic fertilizers by apple growers in china was conducted from july 2016 to october 2016 its aim is to find out what could promote farmers to replace chemical fertilizers with organic fertilizers partially or completely we have analyzed farmers choices involving prospect utility risk and environment based on kahneman s prospect theory and lewin s field theory twelve psychological and socio economic variables were included in a tobit regression model to explain farmers choice between organic fertilizers and chemical fertilizers we find that membership in agriculture cooperatives subsidies on organic fertilizers and farm size play positive roles in influencing farmers choice of organic fertilizers instead of chemical fertilizers the results will be helpful to update extension policy of organic fertilizers

fertilization under uncertainty an analysis based on producer yield expectations optimal nitrogen fertilizer levels are computed for a sample of texas coastal bend grain sorghum producers based on their assessed subjective conditional yield and price probabilities utility measures and cost information producers mean yield expectations were substantially greater than experimental yield response and their perceptions of the effects of nitrogen on yield variability were contrary to usual characterization of nitrogen as a risk increasing input optimal fertilizer levels based on expected utility maximization represent actual fertilizer use somewhat better than those based on expected profit maximization however both calculated levels were high relative to actual fertilizer use

price and authority in inter profit center transactions price and authority have traditionally been regarded as alternative social mechanisms for allocating resources however actual transactions whether inter or intrafirm can be evaluated in terms of the extent to which they combine both of these mechanisms an especially revealing example of this is the exchange of goods between two profit centers in the multi profit center firm three of the most common arrangements or transfer pricing polices for effecting these transactions are examined here exchange autonomy transfers depend primarily on price with no or minimal use of authority mandated full cost transfers involve a substantial exercise of authority relative to the use of price mandated market based transfers use both authority and price in important ways for all three policies the transaction costs of these internal transactions may exceed these costs on external transactions

testing alternative theories of the firm transaction cost knowledge based and measurement explanations for make or buy decisions in information services firms boundary choices have undergone careful examination in recent years particularly in information services while transaction cost economics provides a widely tested explanation for boundary choice more recent theoretical work advances competing knowledge based and measurement cost explanations similar to transaction cost economics these theories examine the impact of exchange attributes on the performance of markets and hierarchies as institutions of governance these theories however offer alternative attributes to those suggested by transaction cost economics or offer alternative mechanisms through which similar attributes influence make buy choices traditional empirical specifications of make buy models are unable to comparatively test among these alternative theories by developing and testing a model of comparative institutional performance rather than institutional choice we examine the degree of support for these competing explanations of boundary choice hypotheses are tested using data on the governance of nine information services at 152 companies our results suggest that a theory of the firm and a theory of boundary choice is likely to be complex requiring integration of transaction cost knowledge based and measurement reasoning 1998 john wiley sons ltd

pricing and green level decisions of a green supply chain with governmental interventions under fuzzy uncertainties abstract environmental issues make green manufacturing become inevitable and fuzzy uncertainty prevails in supply chain management in order to further promote the development of green supply chain according to channel leadership scenario we develop three game models of a green supply chain with governmental interventions under fuzzy uncertainties of both manufacturing cost and consumer demand we study how prices green levels and expected profits are influenced by channel leadership and governmental interventions green level sensitivity and fuzzy degree of parameters are considered analytical results indicate that manufacturer stackelberg scenario is the inferior structure than other scenarios and retailer stackelberg scenario is superior to other scenarios for all players under the strong governmental interventions then when governmental interventions increase the green level will increase but the tendency of retail price depends on channel leadership governmental interventions are not always beneficial to the green supply chain and the manufacturer further although the government s subsidy is offered to the manufacturer the retailer benefits from it ultimately and further becomes the main puller of the development of green products in addition a relatively high green level floor for subsidy results in the manufacturer s first mover disadvantage

inflation and welfare in a monetary economy it is in everyone s private interest to try to get someone else to hold non interest bearing cash and reserves but someone has to hold it all so these efforts must simply cancel out all of us spend several hours per year in this effort and employ thousands of talented and highly trained people to help us these person hours are simply thrown away wasted on a task that should not have to be performed at all

embracing new agriculture commodity through integration of java tea as high value herbal crops in solar pv farms abstract integration of agriculture and renewable energy resources rer is currently a hot topic discussed worldwide based on the need for green energy and sustainable economy the decreasing trend of global market value for the traditional agricultural commodity such as rubber and palm oil really affected the gross national income gni and thus the government of malaysia outlined a number of strategic thrusts to boost economic growth herbal products have been given sufficient rooms for extension as the first approved entry point projects epp1 driver of sustainability orthosiphon stamineus also known as java tea is among the five commercialize high value herbal crops hvhc and chosen to be deployed under pv arrays based on its sustainability and potential market value the financial analysis is based on 3 months harvesting cycle with reference to the harvesting coefficience p c and realistic cash flow the internal rate of return irr is valued at 15 74 that benchmarks positive net return for herbal producers the cash functions based on return on investment roi can be achieved after 10 months cycle of production with net present value npv of rm8 863 59 this initiative flows in line with the cleaner production cp concept of efficient usage of natural resources to minimize waste and pollution the concept of agro technology integration is presented with strong financial return for the unused space under pv arrays configured for large scale pv farms

the influence factors on choice behavior regarding green products based on the theory of consumption values abstract this study applies the theory of consumption values to determine the influence factors on consumer choice behavior regarding green products and examines whether there are significant differences in consumption values and choice behavior between consumers with different outlooks on environmental concerns one way analysis of variance and multiple regression is used to assess data collected by a questionnaire survey the results indicate that consumers with high environmental concern support green products more and show greater readiness to choose them this study concludes that the main influence factors on consumer choice behavior regarding green products include psychological benefit desire for knowledge novelty seeking and specific conditions and do not include functional values price and quality this study contributes to preliminary but vital insights in effective promotion of green products

incomplete contracts and strategic ambiguity why are observed contracts so often incomplete in the sense that they leave contracting parties obligations vague or unspecified traditional answers to this question invoke transaction costs or bounded rationality in contrast the authors argue that such incompleteness is often an essential feature of a well designed contract specifically once some aspects of performance are unverifiable it is often optimal to leave other verifiable aspects of performance unspecified the authors explore the conditions under which this occurs and investigate the structure of optimal contracts when these conditions are satisfied copyright 1998 by american economic association

financial intermediation house prices and the welfare effects of the u s great recession abstract this paper quantifies the welfare costs of the great recession in the united states and their distribution between borrowing and saving households we use a calibrated dynamic general equilibrium model with shocks to aggregate income and to the financial intermediation sector the model matches the boom bust cycle in house prices the dynamics of household leverage and the increase in inequality of wealth observed in the u s after 2007 we find large welfare costs for financially constrained households the borrowers savers instead benefited from a redistribution of housing wealth due to the de leveraging of borrowers caused by the plunge in house prices this redistribution mechanism was exacerbated by the financial intermediation shock we also show that the welfare costs for borrowers would have been lower if aggregate leverage had remained at pre 2001 levels

housing finance and monetary policy we document three facts concerning how the structure of housing finance affects the monetary transmission mechanism first the characteristics of residential mortgage markets differ markedly across industrialized countries second the impact of monetary policy shocks to residential investment and house prices is significantly stronger in those countries with larger flexibility development of mortgage markets third the transmission to consumption is stronger only in those countries where mortgage equity release is common and mortgage contracts are predominantly of the variable rate type we then build a two sector dsge model with financial constraints to rationalize those facts

housing dynamics over the business cycle housing construction measured by housing starts leads gdp in a number of countries measured as residential investment the lead is observed only in the united states and canada elsewhere residential investment is coincident variants of existing theory however predict housing construction lagging gdp in all countries in the sample nominal interest rates are low ahead of gdp peaks introducing long term nominal mortgages and an estimated process for nominal interest rates into a standard model aligns the theory with observations on starts as mortgages transmit nominal rates into real housing costs longer time to build makes residential investment cyclically coincident abstract from author

the housing market s of san diego this paper uses an assignment model to understand the cross section of house prices within a metro area movers demand for housing is derived from a lifecycle problem with credit market frictions equilibrium house prices adjust to assign houses that dier by quality to movers who dier by age income and wealth to quantify the model we measure distributions of house prices house qualities and mover characteristics from micro data on san diego county during the 2000s boom the main result is that cheaper credit for poor households was a major driver of prices especially at the low end of the market

narrowing the gap factors driving organic food consumption in the recent years organic food has gained a great attention from researchers yet the consumption amount and growth in the market share is relatively low compared to conventional food the most consistent findings from previous studies have been the inconsistency between consumers claims and their actual behavior the so called intention behavior or attitude behavior gap the majority of past studies focused on investigating the motivational factors to purchase organic food as a proxy to foster organic food consumption however it is argued that preceding studies focus does not readily embrace the consumption itself where purchasing may come secondary to consumption decision motivation the objective of this paper is to propose a new approach to determine factors influencing organic food consumption by focusing on those who are consuming and not those considering purchasing organic food indeed consumption is a more appropriate measure not confounded with shopping habits consumption also reflects high involvement with the product and the barriers and motivations are as real as the product itself which makes it an ideal moment to examine the motivation a model that was developed was tested using the partial least square statistical analysis of an empirical sample of 133 consumers the results indicated that product specific attitude psa sensory appeal sa and health orientation ho had a significant positive influence on individuals organic food consumption the moderating role of future orientation between psa ho and consumption were examined and found to be significant the result suggests that psa and ho are stronger when future orientation is high the research provides a significant insight and better understanding of narrowing the attitude behavior gap it also adds a new momentum to the growing literature and prior findings on consumer behavior towards organic foods

responsible retailing the practice of csr in banana plantations in costa rica during the last 10 years or so a number of corporate social responsibility csr initiatives have been introduced in global supply chains which aim to improve the conditions of workers engaged in producing goods for export this article discusses the observations of csr in practice in the costa rican united kingdom uk banana chain the banana chain makes for an interesting case study because there are dominant corporate actors at each end who are in a position to influence the conditions experienced by workers on banana plantations at the top of the chain there are four major uk supermarket groups who control access to the retail market and as self appointed guardians of consumer interest are demanding that producers adopt more socially responsible practices at the other end banana production is highly integrated and controlled by three large north american agri businesses who have developed their own social and environmental certification programmes costa rica also makes for an interesting country to locate the study as it has a tradition of state led policies to protect worker rights yet in spite of csr commitments made by both supermarkets and producers that emphasise health and safety and the country s established labour law this article shows that there are problems for workers when they are forced to meet demanding production schedules furthermore it suggests that whilst supermarkets continue to drive down consumer prices and put pressure on producers to reduce costs a downward spiral of working conditions is created regardless of the csr policies in place however this article also identifies that changes to supermarket behaviour is possible when consumer trust is at stake

factors influencing buying behaviour of green energy consumer green energy has gained significant research attention across the globe due to its ability to reduce environmental damage however for complete acceptance of green energy only government regulations are not enough the willingness to use green energy and contribute to the wellbeing of the environment should spring from within consumers such willingness may be developed by enhancing consumers perceived value of green energy however in order to do so it is necessary to assess existing levels of consumers perceived value towards green energy the present study develops a multidimensional green perceived value scale to measure existing levels of consumers perceived value the scale considers green perceived value as a multidimensional second order construct comprising functional value social value conditional value and emotional value dimensions such an attempt has not been made before which highlights the originality value of the present study the scale can be used to assess consumers perception towards green energy such information would help in formulating strategies that encourage consumers to voluntarily adopt green energy the study also reveals that it is not only the financial aspects that lead consumers to decide on adoption of green energy consumers are also driven by emotional and social considerations thus policy makers could formulate pro green energy programmes and mass messages that appeal to consumers sense of responsibility to voluntarily adopt green energy without having to rely on financial incentives researchers could examine the considered dimensions of the scale further with respect to other constructs related to consumer behaviour

subjective performance measures in optimal incentive contracts objective measures of performance are seldom perfect in response incentive contracts often include important subjective components that mitigate incentive distortions caused by imperfect objective measures this paper explores the combined use of subjective and objective performance measures in respectively implicit and explicit incentive contracts naturally objective and subjective measures often are substitutes sometimes strikingly so we show that if objective measures are sufficiently close to perfect then no implicit contracts are feasible because the firm s fallback position after reneging on an implicit contract is too attractive we also show however that objective and subjective measures can reinforce each other if objective measures become more accurate then in some circumstances the optimal contract puts more weight on subjective measures because the improved objective measures increase the value of the ongoing relationship and so reduce the firm s incentive to renege we also analyze the use of subjective weights on objective performance measures and provide case study evidence consistent with our analyses

optimal advertising and pricing for new green products in the circular economy abstract in the circular economy era environmental sustainability is critical and both green and non green products with similar functions co exist in practice there is little doubt that these two types of products are competing and may substitute one another even though one is more environmental friendly than the other in this paper we build analytical models to explore the optimal advertising and pricing decisions for a green product in the presence of a non green product substitute we investigate both simultaneous and sequential pricing strategies under which there are three possible pricing scenarios namely 1 both prices of green and non green products are determined simultaneously strategy ip 2 the green product s price is decided first and then the non green product s price is determined strategy gl and 3 the non green product s price is decided first and then the green product s price is determined strategy nl we find that the sequential pricing strategy is more profitable than the simultaneous pricing strategy for both green and non green supply chains it is interesting to prove the existence of second mover advantage in the pricing game moreover we identify that if the green supply chain uses strategy nl it could achieve a better performance in profit and minimize the corresponding environmental impact if the green supply chain is truly socially responsible it should design a product with low substitutability so that the environmental impact can be enhanced furthermore our numerical results indicate that strategy ip never performs the best in terms of consumer surplus and social welfare when the product substitution level is sufficiently high findings of this paper contribute to the literature on cleaner production systems in the circular economy era

relational contracts and the theory of the firm relational contracts informal agreements sustained by the value of future relationships are prevalent within and between firms we develop repeated game models showing why and how relational contracts within firms vertical integration differ from those between nonintegration we show that integration affects the parties temptations to renege on a given relational contract and hence affects the best relational contract the parties can sustain in this sense the integration decision can be an instrument in the service of the parties relationship our approach also has implications for joint ventures alliances and networks and for the role of management within and between firms

a study on the implementation of renewable heating technologies in the domestic sector in ireland with implications on consumers decision making abstract the paper critically reviews and explores the impact of renewable energy heat policies to induce technological change in ireland it is in response to the challenge of better understanding the broad effects and attributes of renewable energy policy instruments in ireland and beyond using the irish residential sector as a case study and analysing data of more than 31 600 technology installations under the irish government s greener homes scheme ghs the paper assesses the extent to which policy makers may be informed of the willingness of consumers to adopt these technologies in their homes in doing so it attempts to provide valuable guidance for policy evaluation in relation to renewable energy in the residential sector it represents investment decisions and technological choice by the end user and reflects the growing concern among energy policy markets regarding the representation of user preferences the overall intent is to investigate the implications of analysing different variables and their contribution to making more balanced renewable energy policies it provides a critical analysis of the greener homes scheme the key instrument for implementing ireland s renewable heating policy from 2006 to 2010 established to induce technological change within the residential sector in assessing the impact of the scheme attention focuses on decision frameworks for technological choice and the treatment of market and behavioural failures it considers how consumers have responded to new technological policies aimed at deploying renewable heat technologies and the specific policies aimed at advancing certain technologies over others through a case study investigation the paper explores the relationship and dependencies that influence consumers decision making regarding the choice of renewable energy heating technologies in the domestic sector in ireland consumer preferences and their subsequent investment decisions motives and technological choice are reflected it concludes that while economic factors are important a much broader variety of determinants is required when analysing the process of adoption of technology

the impact of clean energy investments on the greek economy an input output analysis 2010 2020 the aim of this paper is twofold first to calculate the green energy investments by industrial sector that greece would need in order to satisfy a number of energy and environmental targets adopted in the context of the european commission s energy and climate change package and second to calculate the macro economic impacts of these green investments on production and employment in the greek economy to this end the input output analysis has been exploited for estimating the direct indirect and induced macroeconomic effects associated with the implementation of selected energy conservation measures the promotion of renewable energy technologies etc our findings show that the required investments would reach the amount of 47 9 billion over the period 2010 2020 these investments will result in an average annual increase of the national product by 9 4 billion creating simultaneously 108 000 full time equivalent jobs for the entire period under consideration the employment generated per 1 million investment is relatively higher in energy saving projects in buildings and transport in comparison with the development of res in power generation sector

alternative origins to interorganizational trust an interdependence perspective on the shadow of the past and the shadow of the future despite the widespread acceptance of trust as an informal governance institution our understanding of its origins is nascent our review of the literature identified two distinct explanations trust emerges from either a shadow of the past i e prior history or a shadow of the future i e expectations of continuity in this paper we develop and empirically examine a third perspective the potential interdependence of these two explanations our results strongly endorse this third perspective we find that prior history does not directly affect trust instead the observed positive relationship between the two is mediated by expectations of continuity consistent with this result analyses further show that a longer prior history makes the effect of continuity on trust much stronger than a shorter prior history we interpret these findings as suggesting 1 the criticality and centrality of a shadow of the future i e a forward looking calculus in generating trust in interorganizational exchanges and 2 that a shadow of the past plays a facilitating albeit indirect role in trust building our conceptual model also extends the conventional use of the transaction cost logic to show how reciprocal investments in asset specificity and uncertainty drive expectations of continuity and consequently interorganizational trust our results also show unexpectedly that prior history has a direct negative effect on trust after specifying the mediating path of continuity our moderation analysis indicates when this effect occurs when weak expectations of continuity exist trust is lower for exchanges characterized by a longer prior history suggesting a potential darkside of overembedded ties

inequality leverage and crises the paper studies how high leverage and crises can arise as a result of changes in the income distribution empirically the periods 1920 1929 and 1983 2007 both exhibited a large increase in the income share of the rich a large increase in leverage for the remainder and an eventual financial and real crisis the paper presents a theoretical model where these features arise endogenously as a result of a shift in bargaining powers over incomes a financial crisis can reduce leverage if it is very large and not accompanied by a real contraction but restoration of the lower income group s bargaining power is more effective

the existence of self enforcing implicit contracts implicit contracts are nontrivial nash equilibria to the post hiring trading game between a worker and the employer these are supported by intrafirm rather than labor market reputations the existence of an implicit contract that supports efficient trade is proved in a simple model

forgiveness in vertical relationships incentive and termination effects two types of contractual solutions have been proposed for resolving incentive conflicts in vertical relationships formal and relational i e enforceable or not by third parties much is known about the optimal structure of formal contracts but relatively little is known about the structure of relational contracts we study a core feature of the latter the conditions leading to continuation of the relationship whose prospect gives relational contracts their force we build a formal model of a vertical relationship between two parties that endogenizes the choice of the minimum performance necessary for continuation as a function of the values of contractibles noncontractibles and outside options the model highlights a basic trade off between providing strong incentives for the present incentive effect and safeguarding relationships for the future termination effect the stable relationships that follow from a more forgiving contract are more important under certain conditions when a lot of value is jointly created by exchange partners i e high contractible value high noncontractible value or unattractive outside options however strong incentives from a less forgiving contract are more important under other conditions when a formal contract is insufficient and a relational contract is most important i e high noncontractible relative to contractible value we discuss implications for the choice of governance of interorganizational relationships

photovoltaic energy systems with battery storage for residential areas an economic analysis abstract the global energy market is characterized by the strong growth of photovoltaic pv energy this renewable source contributes to sustainable development and is a strategic player in the electricity market the profitability of pv systems is determined by incentive tariffs in developing markets and by the share of self consumption in developed markets this paper aims to evaluate i the profitability of pv systems in the residential sector without subsidies and ii the profitability of energy storage in a mature market italy in this way it is possible to define the economic results of integrated pv battery systems and the indicator used is the net present value furthermore a sensitivity analysis is conducted on the critical variables the mathematical model proposed in this paper defines the break even point of the increase of self consumption at which residential pv battery systems become economically viable in a mature market energy storage systems are useful only when the relationship between supply and demand permits them to induce a significant increase of energy self consumption

uncertainty opportunism and governance the effects of volatility and ambiguity on formal and relational contracting comparing the effectiveness of contractual and relational governance in constraining opportunism under conditions of volatility and ambiguity we hypothesize that relational contracts will be robus

relational incentive contracts standard incentive theory models provide a rich framework for studying informational problems but assume that contracts can be perfectly enforced this paper studies the design of self enforced relational contracts i show that optimal contracts often can take a simple stationary form but that self enforcement restricts promised compensation and affects incentive provision with hidden information it may be optimal for an agent to supply the same inefficient effort regardless of cost conditions with moral hazard optimal contracts involve just two levels of compensation this is true even if performance measures are subjective in which case optimal contracts terminate following poor performance jel c73 d82 l14

green products an exploratory study on the consumer behaviour in emerging economies of the east abstract the recent years have witnessed a phenomenal change in quantum and pattern of consumption in the developing nations of the east ever increasing consumption is putting a strain on the environment the present work delves into understanding the relationship between environmental concerns and consumer choice behaviour in purchasing green products in the context of india being a large emerging economy in south east asia attempt has been made to examine the influence of consumption values on sustainable consumer behaviour across consumer segments with preferential green choice approach difference multiple linear regression analysis one way analysis of variance and other standard statistical analysis of the data collected through questionnaire survey have been done results indicate that price sensitivity is high regardless of their choice preference social value parameter being the dominant factor influences sustainable consumption behaviour adoption among the green preferential cluster consumption values differ significantly across consumers exhibiting different preference for products with and without green credentials being higher for those with green purchase or consumption experience or notion

beyond ecolabels what green marketing can learn from conventional marketing ecolabels have emerged as one of the main tools of green marketing although a great deal of effort has been invested in making them more effective and efficient the market share of ecolabelled products is still low partly because they have been addressed mainly to green consumers in a theoretical exposition of marketing theory we find that green marketing could learn from conventional marketing in discovering other means than labelling to promote green products examples include addressing a wider range of consumers working with the positioning strategies of price place and promotion and actively engaging in market creation

explaining the swollen middle why most transactions are a mix of market and hierarchy why are firms sometimes more efficient than markets at organizing transactions why are most transactions arrayed neither at the pure market nor at the pure hierarchy end of the continuum but rather in the swollen middle incorporating features of both market and hierarchy why don t firms make greater use of price incentives this paper addresses these three questions by developing a model of the choice of institution one key building block is the distinction between organizing methods hierarchy and the price system and institutions firms and markets hierarchy and the price system are two distinct methods for organizing transactions each with particular costs and benefits markets and firms are institutions which use one or both of these methods although markets predominantly use prices and firms rely principally on hierarchy there is not a one to one correspondence between prices and markets or between hierarchy and firms indeed the paper argues that it is generally more efficient to use a mix of both methods than to specialize in either the paper focuses on the enforcement properties of prices and hierarchy hierarchy controls individuals directly by constraining their behavior by imposing behavior constraints while prices do it indirectly by measuring their outputs through price constraints under hierarchy individuals receive a salary to do as told while self employed individuals governed by the price system are rewarded on the basis of their output each system has its own biases using prices maximizes effort minimizes shirking but incites individuals to inflate the price and or reduce the quality of their output it encourages cheating relying on hierarchy results in the opposite bias under hierarchy individuals are not paid in function of their output but instead are rewarded for following directives they have thus strong incentives to minimize effort to shirk unless properly supervised but being paid a fixed sum to follow orders they have few incentives to cheat hence the price system experiences low shirking but potentially high cheating costs while hierarchy faces low cheating but high shirking costs organizing costs are the sum of shirking and cheating costs any given transaction will be organized by the mix of price and hierarchy i e by the mix of price and behavior constraints that minimizes organizing costs a transaction will be organized within a firm if the reduction in cheating costs achieved by replacing price constraints by behavior constraints exceeds the resulting increase in shirking costs and by the market in the opposite case the paper shows that cheating and shirking costs increase more than proportionately as one concentrates in either pure price or behavior constraints hence using a mix of both methods generally minimizes the sum of cheating and shirking costs this explains why most transactions exhibit features of both markets and hierarchy the paper shows clearly the tradeoff involved between price and behavior constraints it explains the costs and benefits of using two types of price incentives in firms piecework and profit centers and predicts when they will be used

a dynamic model of housing demand estimation and policy implications in the u s macroeconomic policy makers are concerned about how consumers will respond to falling incomes nominal home prices falling income rising mortgage interest rates and tightening credit standards in order to address these questions we estimate and simulate a dynamic structural model of housing demand in the model consumers maximize expected discounted lifetime utility from housing services and a composite consumption good the model allows for realistic features of the housing market including non convex adjustment costs from buying and selling a home and credit constraints from minimum downpayment requirements we use the forward simulation procedure of bajari benkard and levin 2007 to estimate the structural parameters especially the elasticity of substitution between consumption and housing services using data from the panel study of income dynamics given the estimated model parameters we simulate the partial equilibrium consumption and housing and

house prices borrowing constraints and monetary policy in the business cycle i develop a general equilibrium model with sticky prices credit constraints nominal loans and asset prices changes in asset prices modify agents borrowing capacity through collateral value changes in nominal prices affect real repayments through debt deflation monetary policy shocks move asset and nominal prices in the same direction and are amplified and propagated over time the financial accelerator is not constant across shocks nominal debt stabilises supply shocks making the economy less volatile when the central bank controls the interest rate i discuss the role of equity debt indexation and household and firm leverage in the propagation mechanism finally i find that monetary policy should not target asset prices as a means of reducing output and inflation volatility

the bunch of sustainability labels do consumers differentiate abstract a huge number of sustainable labels addressing the different pillars of sustainability emerged over the last years some labels promote factors which already imply other sustainability issues e g organic incl animal friendliness to a certain extent hence the question arises how consumers react towards the redundancies of different sustainability labels to add to the literature this study applies a latent class model for discrete choices first to test whether consumers take different sustainable labels into account when making their decision and second to test how consumers deal with different sustainable labels that are partly claiming the same aspect results indicate that three consumer segments with well distinguished preferences and willingness to pay measures for the respective attributes can be identified one group being the price sensitives exclusively deciding on the product with the lowest price regardless of any sustainable attribute of the product another group opts for products with a sustainable label without any clear preference for a specific sustainable attribute but expressing a clear willingness to pay more for all presented sustainable labels i e the label choosers a third group can be named price conscious label discriminators for them some sustainable aspects provide negative utility when labelled exclusively e g organic or free of genetically modified organisms but labelled together e g organic together with free of genetically modified organisms or animal welfare it provides them significantly positive utility even though being redundant by definition based on our findings there is no general statement to be made regarding the question whether different sustainable aspects complement or substitute each other the research rather emphasizes that a differentiated look at different consumer types and different labels symbolizing sustainability is needed the research adds to the existing literature by examining not only the relevance and acceptance of different sustainable labels to different consumer segments but also the interrelationship of different sustainable labels the study clearly shows that with regard to different sustainable labels the more the merrier does not always apply however almost 85 of the market could be satisfied with a universal sustainability label

methodologies and perspectives in research on labour relations in global agricultural production networks a review the integration of global south actors into the global agricultural economy has attracted research on labour effects this is because global south actors are often integrated at the level of produc

credit crises precautionary savings and the liquidity trap we use a model a la bewly huggett ayagari to explore the eects of a credit crunch on consumer spending households borrow and lend to smooth idiosyncratic income shocks facing an exogenous borrowing constraint we look at the economy response after an unexpected permananent tightening of this constraint the interest rate drops sharply in the short run and then adjusts to a lower steady state level this is due to the fact that after the shock a large fraction of agents is far below their target holdings of precautionary savings and this generates a large temporary positive shock to net lending we then look at the eects on output here two opposing forces are present as households can deleverage in two ways by consuming less and by working more we show that under a reasonable parametrization the eect on consumer spending dominates and precautionary behavior generates a recession if we add nominal rigidities two things happen i supply side responses are muted and ii there is a lower bound on the interest rate adjustment these two elements tend to amplify the recession caused by the credit tightening

solar photovoltaic in malaysia the way forward abstract this paper examines solar photovoltaic pv in malaysia first it analyzes the current energy demand in malaysia and discusses some of the national policies and the installations of solar pv in urban and rural areas in the country next the general feed in tariff fit scheme is explained indicating its potential as one of the investment options for malaysians finally the loan financing option for solar pv is presented providing examples that have been implemented in other countries as well as explaining the green technology financing scheme gtfs for companies and the proposed soft loan scheme for individual households in malaysia it also analyses the impact of the proposed interest rate to household consumers in malaysia in terms of total profit net present value and internal rate of return it is found that the fit scheme could potentially help in increasing renewable energy penetration particularly for solar pv to provide upfront capital for solar pv installation it is shown that the gtfs is a good financial source for companies while for individual home owners a soft loan facility from banking institutions is a feasible source if the interest rate is 5 or less

a dynamic model of housing demand estimation and policy implications a dynamic model of housing demand using data from the panel study of income dynamics psid we specify estimate and simulate a dynamic structural model of housing demand our model generalizes previous applied econometric work by incorporating realistic features of the housing market including non convex adjustment costs from buying and selling a home credit constraints from minimum downpayment requirements and uncertainty about the evolution of incomes and home prices we argue that these features are critical for capturing salient features of housing demand observed in the psid after estimating the model we use it to simulate how consumer behavior responds to house price and income declines as well as tightening credit these experiments are motivated by the u s recession starting in december of 2007 that saw large falls in home prices large negative income shocks for many households and tightening credit standards in the short run relatively few households adjust their housing stock households respond instead by reducing non housing consumption and reducing wealth because they wish to avoid losing their home and the associated adjustment costs households that adjust in the short run are those hit with a series of bad shocks such as a negative income shock and a home price decline a larger proportion of households do adjust their consumption in the long run increasing their housing stock since housing is less expensive however such changes may occur several years after the shocks listed above

governance institutions and adaptation costs evidence from the fall of the berlin wall this paper investigates how institutions governing the employment relationship influence firms adaptation to environmental changes after the berlin wall fell migration from east germany accounted for an abrupt increase in the supply of a key resource labor in the west i study responses to this disruption among firms in the economically important machinery and equipment industry i find that western firms adapted to migration by increasing employment unless they were affiliated with a works council an institution that limits the firm s autonomy in managing its workforce i also find evidence of institution contingent responses to migration in two areas of firm strategy vertical boundaries and the focus on exploration versus exploitation the results suggest that hybrid i e less hierarchical governance institutions increase adaptation costs the results also indicate that such adaptation costs have implications for multiple aspects of firm decision making that are nominally beyond the scope of those governance institutions this paper was accepted by bruno cassiman business strategy

environmental accounting a management tool for enhancing corporate environmental and economic performance abstract industries are becoming progressively more aware of the environmental and social liabilities pertaining to their operations and products with associated financial effects uncertainties in measuring these financial effects can be addressed by using environmental evaluation and accounting techniques environmental accounting assists in expressing environmental and social liabilities as environmental costs while environmental accounting systems now form part of industrial decision making in first world countries there is a lack of similar systems in south africa the eegecost model was developed to promote environmental accounting in south africa implementation of the model will provide south african industries with the framework for corporate evaluation of alternative investments projects and processes and for estimating economic and environmental performance at present and especially in the future the model identifies records and allocates internal and external environmental costs to five identified cost types categorised into several environmental media groups it also assists in the capital budgeting process for alternative investments applicability of the model was tested in a case study conducted on the life cycle assessment of a functional unit of one million cigarettes the model indicated that type v costs external costs with types i to iv being different internal cost types contributed 12 of the total production costs of a functional unit of cigarettes as type v costs are subjective it is recommended that further research be conducted to structure an objective framework to evaluate and determine cost factors involved in the development of type v costs

leveraging factors for sustained green consumption behavior based on consumption value perceptions testing the structural model changing lifestyle and consumption pattern being the aftermath of growth and urbanization is putting a strain on environment and sustainable development the consumption value perceptions are identified in the study as the drivers of sustained green product consumption and intention to pay the green price premium using the theory of consumption values these value perceptions are certain parameters measuring consumer utilities along multiple value dimensions impacting choice behavior environmental attitude contextual factors and consumer innovativeness were included as the first order constructs data was collected through survey based method using structured questionnaires structural equation modeling was applied for testing the hypothesized model results confirmed consumers price and knowledge perceptions to be the major determinants of the behavioral outcome of sustained green consumption and behavioral intention to pay the green price premium is the outcome of sustained green consumption implications of the research were discussed

an evaluation of the installation of solar photovoltaic in residential houses in malaysia past present and future abstract this paper examines solar energy development in malaysia particularly in relation to the installation of solar photovoltaic pv in residential houses it analyzes the past activities related to solar energy in malaysia in terms of research and developments r ds the implementations used as well as the national policies for the past 20 years which have pushed the installation of pv in the country the feed in tariff fit scheme is discussed showing comparative cost benefit analysis between the pv installation in houses in the united kingdom uk and malaysia and with other investment schemes available in malaysia to investigate the awareness of renewable energy policies and incentives a preliminary survey of the public opinion in malaysia has been carried out and an evaluation of public willingness to invest in the fit scheme by installing the pv on their houses is presented the cost benefit analysis shows that the proposed fit programme is capable of generating good return on investment as compared to the one in the uk but the return is lower than other investment tools the survey suggests that most malaysians are unaware of the government s incentives and policies towards renewable energies and are not willing to invest in the fit scheme

credit booms and lending standards evidence from the subprime mortgage market this paper links the u s subprime mortgage crisis to demand side factors that contributed to the rapid expansion of the u s mortgage market we show that denial rates were relatively lower in areas that experienced faster credit demand growth and that lenders in these high growth areas attached less weight to applicants loan to income ratios the results are robust to controlling for supply side factors including house price appreciation mortgage securitization and other economic fundamentals and to several robustness tests controlling for endogeneity the results are consistent with the notion that a relaxation of lending standards triggered by an increased demand for loans contributed to the boom and the ensuing crisis together with other supply side explanations these findings shed new light on the relationship between credit booms and financial instability

green jobs economic impacts of renewable energy in germany abstract the labor market implications of large investment into renewable energy re are analyzed in this text although a growing re industry can be observed in germany the overall effect of large increases of re based electricity and heat generating technologies on the german economy require a careful model based analysis the applied model panta rhei has been used among others to evaluate the german energy concept in 2010 it takes positive and negative impacts of re into account the paper shows the overall effects under different assumptions for fossil fuel prices domestic installations and international trade the results are sensitive to assumptions on the development of re world markets and german exports to these markets almost all of these scenarios exhibit positive net employment effects under medium assumptions net employment of re expansion will reach around 150 thousand in 2030 only with assumptions for german re exports below today s level net impacts are slightly negative gross employment will increase from 340 thousand in 2009 to between 500 and 600 thousand in 2030

the great recession lessons from microeconomic data crises and sharp economic downturns while undesirable provide economists with a unique opportunity to test and hone economic theory indeed some of the most influential advance ments in economic thought including milton friedman s monetarist tradition john maynard keynes fiscal theory and irving fisher s debtdeflation hypothesis emerged from analysis of the great depression the current economic malaise which we refer to as the great recession provides another watershed moment to reevaluate our core economic beliefs however in contrast to our peers in previous crises we are fortunate to have access to large scale microeconomic datasets and advancements in computational capacity these advantages allow for a more rigorous analysis of the current recession and therefore a more informed understanding of its origins propagation and consequences our purpose is to highlight how a micro level analysis of the great recession provides us with important clues to understand the origins of the crisis the link between credit and asset prices the feedback effect from asset prices to the real economy and the role of household leverage in explaining the downturn we hope that our discussion also serves as an example of the useful ness of incorporating microeconomic data and techniques in answering traditional macroeco nomic questions i what were the origins of the credit cycle credit demand or credit supply

learning to contract evidence from the personal computer industry organizational forms involving more detailed contracts than are found in traditional spot market exchanges appear to be increasingly prevalent there has been relatively little analysis however of the extent to which firms learn how to use contracts to manage their interfirm relationships over time in this paper we conduct a detailed case study of a time series of 11 contracts concluded during 1989 1997 between the same two partners both of whom participate in the personal computer industry to explore whether and how firms learn to contract we find many changes to the structure of the contracts that cannot be fully explained by changes in the assets at risk in the relationship and evidence that these changes are largely the result of processes in which the firms were learning how to work together including learning how to contract with each other the nature of this learning appears to have been quite incremental and local that is not very far sighted we suggest how and when contracts might serve as repositories for knowledge about how to govern collaborations and suggest some boundary conditions for this phenomenon our findings also provide implications for the debate about whether contracts have a positive or negative effect on interorganizational trust we conclude with suggestions for future research

ownership and control rights in internet portal alliances 1995 1999 we examine the structure of more than 100 alliances by internet portals and other firms between 1995 to 1999 from a contract theory perspective models of incomplete contracts frequently invoke unforeseen contingencies the cost of writing contracts and the cost of enforcing contracts in justifying the assumption of incompleteness the setting in which internet portals formed alliances was rife with these sorts of transaction costs we argue that these alliances can be viewed as incomplete contracts and find that the division of ownership and the allocation of control rights are consistent with the incomplete contracting literature copyright 2003 by the rand corporation

global banks and crisis transmission abstract we study the effect of financial integration through banks on the transmission of international business cycles in a sample of 18 20 developed countries between 1978 and 2009 we find that in periods without financial crises increases in bilateral banking linkages are associated with more divergent output cycles this relation is significantly weaker during financial turmoil periods suggesting that financial crises induce co movement among more financially integrated countries we also show that countries with stronger direct and indirect financial ties to the u s experienced more synchronized cycles with the u s during the recent 2007 2009 crisis we then interpret these findings using a simple general equilibrium model of international business cycles with banks and shocks to banking activity the model suggests that the relation between integration and synchronization depends on the type of shocks hitting the world economy and that shocks to global banks played an important role in triggering and spreading the 2007 2009 crisis

monetary policy when households have debt new evidence on the transmission mechanism in response to an unanticipated change in interest rates households with mortgage debt adjust their expenditure signicantly especially on durable goods renters react to a lesser extent and outright home owners do not react at all all housing tenure groups experience a signicant change in disposable income over and above the direct impact on mortgage repayments the response of house prices is sizable driving a signicant adjustment in loanto income ratios but little change in loan to value ratios a simple collateral constraint model augmented with durable goods and a renting decision generates predictions consistent with these novel empirical ndings and suggests that heterogeneity in housing debt positions plays an important role in the transmission of monetary policy

the power of emotional value exploring the effects of values on green product consumer choice behavior using the theory of consumption values this research proposes to explore the consumer choice behavior for green products in pakistan functional value price and quality social value conditional value epistemic value and emotional value and environmental value were used to study the consumer choice behavior for green products it also gauges the extent to which emotional value moderates the impact of other consumption values on green product consumer choice behavior based on a sample of 260 respondents the results indicate that functional value price social value and environmental value have a positive impact on green product consumer choice behavior while conditional value and epistemic value have a negative effect functional value quality and emotional value do not influence green product consumer choice behavior as a moderator emotional value has a significant effect on the role of functional value social value conditional value epistemic value and environmental value this confirms and significantly adds to the literature of green product consumer choice behavior in a developing market

materialistic values impact on pro environmental behavior the case of transition country as lithuania abstract materialism is becoming a global phenomenon and is increasing exponentially lithuania which has survived a long period of occupation experienced privatization and goods famine is attributed to the transition countries in terms of materialistic values lithuania is not an exception as material wealth and image are also very important thus the main question of this paper was whether materialistic values could be reconciled with the pro environmental behavior which can be considered as one of the main aspects seeking sustainability according to the lithuanian representative survey and by applying the approach of structural equation modeling the results showed that materialistic values had an insignificant impact on the environmental concern belief and responsibility meanwhile analyzing the impact of materialistic values on conservation and princely behavior it was found that because of gain goals materialists were more linked to perform conservation behavior and because of hedonistic goals princely behavior moreover the environmental concern significantly and positively influenced princely behavior but negatively conservation behavior environmental beliefs had a positive impact only on conservation behavior these findings could be important seeking the promotion of pro environmental behavior particularly in materialistic societies

a model proposal for green supply chain network design based on consumer segmentation the consumption based economy has created enormous ecological footprint of product and service life cycles therefore the environmental sustainability has become one of the major concerns of today s society and sparked tremendous amount of research according to the related literature analysis there is no specific study to design the green supply chain network based on consumers green expectations this study aims to contribute to the fulfillment of this research gap by proposing a goal programming model considering three consumer segments i e green inconsistent and red consumers a hypothetical real life like example problem is solved to demonstrate clearly the value and applicability of the proposed model a set of scenarios is also studied to offer an insight on how the consumer determination level of greenness affects the green supply network the findings of the study present a way to measure the relations between green supply chains and consumer behavior

relational incentives and moral hazard in teams this paper studies moral hazard in teams using a model where efforts are promoted via the combination of profit shares and relational contracts the focus is on how these two forms of incentives interact according to the degree of effort observability and the importance of future interaction the optimal allocation of profit shares can range from a wide dispersion across players to a full concentration of shares in the hands of a single player when shares are sufficiently concentrated the corresponding residual claimant can also adopt the role of administering all relational contracts therefore serving as an endogenously chosen principal copyright 2007 wiley blackwell

trade in occupational safety and health tracing the embodied human and economic harm in labour along the global supply chain abstract over the past years there has been enormous concern about labour conditions in developing countries particularly around work for the export market this study addresses human rights issues related to occupational safety and health for people suffering injuries from work demanded as a result of international trade arrangements here we present occupational safety and health footprints which include the number of work related accidents that occur throughout the world and that are directly and indirectly linked to the consumption of products calculated for every nation s consumption bundle oshf include fatal footprints non fatal footprints days lost footprints and wages lost footprints per given year in order to calculate the oshf we used a comprehensive multi regional input output mrio table eora in addition to data from the international labour organization asean occupational safety and health network asean oshnet and others this study finds that in 2010 there were 12 fatal and 4 8 thousand non fatal incidents 27 thousand days lost and two million us lost in wages per 100 thousand workers in supply chains worldwide the results presented in this paper show hidden accidents throughout global supply chains and hence can be used to apply pressure on international organisations governments and focal companies to improve the conditions of workers particularly in terms of osh in the workplace

cost of business cycles with indivisibilities and liquidity constraints it is almost universally agreed that individuals face incomplete insurance markets and cannot perfectly insure against the idiosyncratic risk in this paper simple general equilibrium models with incomplete insurance markets are examined in order to assess the impact of imperfect insurance on the magnitude of the welfare costs of business cycles two versions of incomplete insurance markets are considered and certain statistical properties of the equilibrium stochastic processes in these environments are compared with those of a perfect insurance economy

incentives for promoting agricultural clean production technologies in china abstract since the start of this century chinese agricultural priorities have greatly changed food security is no longer the sole target of agricultural development and increased attention is now focused on environmental protection and stable growth of farmers incomes however implementation of agricultural clean production practices has been slow despite their official promotion at least partly because of farmers hesitancy to adopt them due to fears that they would lose income in various countries subsidies have successfully countered such hesitation therefore we have surveyed chinese farmers willingness to pay for environmental protection and accept compensation for potential losses of net income in relation to identified characteristics subsidies and other incentives to encourage agricultural clean production in china the results indicate that financial support from government at all levels is essential for its effective promotion in the long term although farmers are willing to adopt environmental protection measures and make some contribution to their costs as responsible citizens subsidizing farmers who voluntarily participate in agricultural insurance and adopt cleaner production practices is regarded as fair and equitable to avoid unacceptable reductions in their profits and life quality the results also show that reasonable and targeted incentives could make broad contributions to cleaner agricultural production in china

intergenerational redistribution in the great recession in this paper we construct a stochastic overlapping generations general equilibrium model in which households are subject to aggregate shocks that aect both wages and asset prices we use a calibrated version of the model to quantify how the welfare costs of severe recessions are distributed across dierent household age groups the model predicts that younger cohorts fare better than older cohorts when the equilibrium decline in asset prices is large relative to the decline in wages asset price declines hurt the old who rely on asset sales to nance consumption but benet the young who purchase assets at depressed prices in our preferred calibration asset prices decline more than twice as much as wages consistent with the experience of the us economy in the great recession a model recession is approximately welfare neutral for households in the 20 29 age group but translates into a large welfare loss of around 10 percent of lifetime consumption for households aged 70 and over

an approach of measuring environmental protection in chinese industries a study using input output model analysis abstract with a green economy making significant developments at a global scale the environmental protection industry has become an increasingly important part of china s national economy china s environmental protection industry is a strategic emerging industry and is expected to become a future pillar of the economy to promote the environmental protection industry in china and to guide environmental protection activities in various sectors the input output method was used to develop china s first environmental protection industry specifically using an externalized input output model various coefficients were measured and analyzed from the perspective of the industry chain the results reveal that the development of environmental protection activities and related environmental investment should give priority to sectors with a current shortage of environmental protection industry input concentrating on these industries will provide relatively higher benefits these industries include primary manufacturing industries the wholesale and retail marketing industries the financial industry and some sectors in second industries in addition the results of a demand and supply model reflect the fact that the environmental protection industry in china should actively promote the environmental finance and fund environmentally friendly products finally the model provides a useful tool that will allow government agencies to develop scientifically sound polices to simulate the economy and provide positive effects on investments

stationary equilibria in asset pricing models with incomplete markets and collateral we consider an infinite horizon exchange economy with incomplete markets and collateral constraints as in the two period model of geanakoplos and zame 2002 households can default on their liabilities at any time and financial securities are only traded if the promises associated with these securities are backed by collateral we examine an economy with a single perishable consumption good where the only collateral available consists of productive assets in this model competitive equilibria always exist and we show that under the assumption that all exogenous variables follow a markov chain there also exist stationary equilibria these equilibria can be characterized by a mapping from the exogenous shock and the current distribution of financial wealth to prices and portfolio choices we develop an algorithm to approximate this mapping numerically and discuss ways to implement the algorithm in practice a computational example demonstrates the performance of the algorithm and shows some quantitative features of equilibria in a model with collateral and default

implicit contracts incentive compatibility and involuntary unemployment this paper considers the enforceability of employment contracts when employees performance cannot be verified in court so that piece rate contracts are not legally enforceable part i shows that there exists a variety of self enforcing implicit contracts modelled as perfect equilibria in a repeated game and characterizes all the wage and performance outcomes that can be implemented implementation requires a strictly positive surplus from employment the form of the contract depending on how this surplus is divided between firm and employee piece rate contracts and contracts with an informally agreed bonus can be made self enforcing but the use of severance pay and bonding does not extend the set of implementable allocations the resulting contracts resemble actual labor contracts more than do the contracts in standard principal agent models part ii analyses market equilibrium with these contracts also modelled as perfect equilibria in a repeated game and shows that many such equilibria exist unfilled vacancies and unemployed workers can co exist despite the existence of contracts that are potentially mutually beneficial for those jobs that are filled any division of the potential surplus is possible so that the market can have at the same time involuntary unemployment and vacancies that are unfilled despite filled jobs earning positive profits as a criterion for selecting equilibria a notion of renegotiation proofness is applied then either all workers are employed or all jobs filled but any division of the potential surplus is still possible the paper explores what further restrictions on beliefs give rise to a walrasian outcome in which all the potential surplus goes to the short side of the market and to an efficiency wage type outcome in which the potential surplus goes to the long side

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

formal contracts in the presence of relational enforcement mechanisms evidence from technology development projects formal contracting addresses the moral hazard problems inherent in interfirm deals via explicit terms designed to achieve incentive alignment alternatively when firms expect to interact repeatedly relational mechanisms may achieve similar results without the associated costs however as we now know from a growing body of theoretical and empirical work the resulting intuition that relational mechanisms will be substituted for formal ones whenever possible does not generally hold the extent to which firms substitute relational mechanisms for formal ones in the presence of repeated interaction is an empirical question that forms the basis of this paper we study a sample of 52 joint technology development contracts in the telecommunications and microelectronics industries and devise a coding scheme to allow empirical comparison of contract terms counter to the above intuition but consistent with recent research we find that a firm s contracts are more detailed and more likely to include penalties when it engages in frequent deals whether with the same or different partners our results suggest complementarity between formal and relational contracts and have implications for optimal contracting particularly in high technology sectors

complementarity and evolution of contractual provisions an empirical study of it services contracts an increasing volume of business activity appears to be occurring via alliances or other interfirm arrangements in which complex contracts are featured yet there has been relatively little study of contract design in the strategy or management literatures the economics literature on contracting has been extensive but it has been less concerned with learning and evolution phenomena in which strategy and organization scholars are deeply interested in this paper we investigate the relationship between two types of contractual provisions that are important in high technology contracts or contracts for which environmental uncertainty or technological complexity are significant namely contingency planning and task description previous research suggests that contracts can vary significantly in the degree of detail with which such key provisions are written and that they are each subject to learning in this paper we find evidence from a sample of 386 contracts that contingency planning and task description behave as complements in contractual design we argue that this complementarity reflects patterns of learning to contract we also find that repeated exchange between two firms leads to greater effort at contingency planning in subsequent contracts a finding that is also consistent with learning effects but not with frequently made claims that contracts and trust are substitutes

optimal control for transboundary pollution under ecological compensation a stochastic differential game approach abstract to account for previously ignored yet widely observed uncertainty in nature s capability to replenish the natural environment in ways that should inform ideal design of ecological compensation ec regimes this study constructs a stochastic differential game sdg model to analyze transboundary pollution control options between a compensating and compensated region equilibrium strategies in the stochastic two player game inform optimal control theory and reveal a welfare distribution mechanism to form the basis of an improved cooperative game contract a case based numerical example serves to verify the theoretical results and supports three key insights first accounting for various random disturbance factors the probabilistic pollutant stock in stackelberg non cooperative game exceeds that of a cooperative game situation second the ec mechanism provides long term effective incentives only when the marginal losses of environmental damage in the compensating region are more than twice that of the compensated region achieving a pareto optimal equilibrium relies upon the attainment of a dynamic allocation ratio derived from the analysis of a robust welfare allocation mechanism third cross region cooperation reliably outperforms stackelberg non cooperation due to either overwhelming incumbent economic interests or high abatement costs this study illuminates the importance of balancing both parties interests within an ec agreement while reducing uncertainty around unobserved environmental factors during ex ante negotiations