on the equitability of progressive taxation abstract we propose the principle of equal sacrifice to determine the class of vertically inequitable progressive taxes a necessary condition for an income tax function to be equal sacrifice is formulated and hence a subclass of progressive taxes which cannot inflict the same sacrifice upon all individuals relative toanystrictly increasing and concave utility function is determined conversely it is shown in a general framework that any convex thus progressive tax function satisfies the principle of equal sacrifice our findings point to the fact that equal sacrifice under progressive income taxation depends heavily upon the degree of marginal rate as opposed to average rate progressivity journal of economic literatureclassification numbers d63 h20

new venture internationalization strategic change and performance a follow up study abstract although many scholars business experts and government agencies enthusiastically advise all firms including new and small ventures to internationalize such advice does not appear to be based on empirical evidence few researchers have empirically examined the link between new venture performance and the internationalization of new ventures at best the evidence suggests that there is no significant relationship we used a sample of 62 u s new venture manufacturers in the computer and communications equipment industries during the late 1980s these industries were purportedly globalizing and may have been leading other industries into increased international operations we found that higher levels of internationalization percentage of foreign sales to total venture sales were associated with higher relative market share two years later however there was no significant direct relationship between percentage of international sales and subsequent return on investment roi perhaps international operations simply cost more than expected or perhaps as macmillan and day 1987 found in their study of corporate ventures over a 4 year time period increases in market share may be a prelude to higher roi as scale benefits translate into higher profitability however the 2 year time period of our study may simply not be long enough for investments in higher market shares to produce improved profits during the 2 year study period many of the ventures changed their level of internationalization of the 36 ventures who were domestic no international sales in the prior study 10 expanded into international markets over the 2 years of the 26 originally international ventures international sales of at least 5 half increased their percentage of international sales nine reduced it and four stayed the same whereas the average change in international sales percentage of the ventures was only 2 9 percentage points the large standard deviation of 13 0 percentage points and the leptokurtic distribution 9 2 reflected the dramatic changes made by some of the ventures using subgroup analysis we examined these changes in percentage of international sales in conjunction with changes in strategies and performance ventures that had increased international sales relative to those that had not exhibited more positive associations between the degree of strategic change and performance as measured in terms of both relative market share and roi increased international sales in technology based new ventures seems to require simultaneous strategic changes in order to positively impact venture performance this study is a follow up to mcdougall s 1989 finding that technology based new ventures that had sales in foreign markets had significantly different strategies than similar ventures that sold their products only domestically the current study enriches the previous findings by adding consideration of 1 changes in degree of internationalization 2 changes in strategy and 3 venture performance although we found no performance penalty associated with increasing international sales alone indiscriminant advice for new ventures to sell in foreign markets without other supporting strategic actions is inconsistent with our findings internationalization alone did not lead to increased profitability entrepreneurs of young technology based firms who are considering internationalization should take heed of our results internationalization of sales does not appear to be a simple matter of applying established strategies and procedures developed for a domestic arena successful internationalization appears to require changes in the venture s strategy as well

internationalize to live a study of the post internationalization survival of new ventures despite a growing number of studies on the survival of new ventures who pursue an international entry strategy research in this area is not yet conclusive one line of argument tells a story of unprepared novices making a risky move and thus predicts negative consequences another line of argument tells a story of prepared entrepreneurs making a strategic decision and thus predicts positive consequences the problem of estimating the true effect involves an important endogeneity problem that can only be overcome by accounting for the fact that new ventures self select into internationalization the goal of this research is to add to the post internationalization survival literature by accounting for this self selection using an endogenous switching model in a potential outcomes or counterfactual inference approach leveraging a panel of us new ventures from the kauffman firm survey our results paint a picture more in line with the preparedness logic of new venture internationalization after controlling for this self selection we find a positive average treatment effect of internationalization on survival and we find evidence that early internationalization is better for post internationalization survival than late internationalization we argue that these results suggest that the new theories of new venture internationalization needs to be further unchained from the process theories of internationalization

the collected papers of richard a musgrave a review article richard musgrave is the doyen of public finance economists his written work has affected virtually every branch of the subject it is important not only in its own right but also on account of where it has led others to follow the theory of public finance 1959 is a landmark in the field unlikely ever to be surpassed in breadth of coverage or depth of scholarship his teaching has influenced many generations of students at michigan johns hopkins princeton and harvard and his active participation in professional activities both inside and outside universities has been an example to us all the publication of his collected papers in public finance in a democratic society is therefore very much to be welcomed the two volumes reviewed here reprint articles and contributions to books spanning the period from his voluntary exchange theory of public economy in 1938 to the a brief review of fiscal doctrine which appeared in the first volume of the handbook of public economics in 1985 the 800 pages represent only a fraction of musgrave s total writings which he estimates at some 10 000 pages i 90 but the collection provides an excellent overall view of his contribution to public finance the first volume deals with fiscal functions and social goals taxation and macro economic aspects of fiscal policy the second volume covers fiscal federalism social security development finance and fiscal doctrine it need hardly be said that such a broad canvas cannot be adequately covered in this article and my review selects a small number of topics for discussion

a theory of international new ventures a decade of research oviatt and mcdougall s jibs article identified and defined international new ventures invs and their prominent role in the global marketplace the article spurred worldwide interest in invs by raising questions about the validity and efficacy of existing theory especially about the uppsala process model of internationalization the article also laid an important theoretical foundation for research into international entrepreneurship ie where younger and wellestablished companies use their entrepreneurial activities to create value as they internationalize their operations this paper reviews oviatt and mcdougall s original propositions highlighting their important contributions to the field the paper also highlights the progress made in research using oviatt and mcdougall s framework the major debates that persist about the nature and role of invs the source of their competitive advantages and the key issues to be explored in future research

aggregate consumer behaviour and the measurement of inequality this paper presents an approach to inequality measurement based on an econometric model of aggregate consumer behaviour the novel feature of this model is that systems of individual demand functions can be recovered uniquely from the system of aggregate demand functions we present methods for evaluating social welfare based on an explicit social welfare function this social welfare function incorporates measures of individual welfare based on indirect utility functions for all consumer units we develop indexes of inequality based on actual and potential levels of social welfare

revisiting the classical view of benefit based taxation this paper explores how the persistently popular classical logic of bene t based taxation in which an individual s bene t from public goods is tied to his or her income earning ability can be incorporated into modern optimal tax theory if lindahl s methods are applied to that view of bene ts rst best optimal policy can be characterized analytically as depending on a few potentially estimable statistics in particular the coe cient of complementarity between public goods and innate talent constrained optimal policy with a pareto e cient objective that strikes a balance controlled by a single parameter between this principle and the familiar utilitarian criterion can be simulated using conventional constraints and methods a wide range of optimal policy outcomes can result including those that match well several features of existing policies to the extent that such an objective re ects the mixed normative reasoning behind prevailing

pareto improving water management over space and time the honolulu case we model welfare gains from efficient allocation of groundwater over space and time relative to the status quo policy of financial cost recovery in order to promote political feasibility an intertemporal compensation plan is devised that renders the reform pareto improving gainers from the reform finance the compensation in proportion to their benefits through a block pricing scheme for the honolulu case only 7 of the 441 million in gains to winners is needed to compensate losers from the reform future winners from the reform also repay the deficit created by the compensation package much as state and local governments finance capital improvements copyright 2009 oxford university press

how well do static indicators identify the chronically poor abstract we investigate how well the most widely used static welfare indicators perform in identifying the chronically poor we propose a normative measure of performance the cost of a given impact on chronic poverty when transfers are contingent upon a purely static indicator using longitudinal household data from rural india we find that current consumption is not always a better indicator of chronic poverty than current income both however perform much better than other common indicators such as food share and access to land

an index of inequality with applications to horizontal equity and social mobility horizontal equity and social mobility are discussed in terms of a non utilitarian social welfare function which takes account of the process by which an ex ante distribution is mapped into an ex post distribution by the tax system for example an index of inequality is proposed which decomposes into two components corresponding to vertical and horizontal equity respectively a functional form for the social welfare function is derived for the purposes of empirical work and an application to data for 5895 uk households is presented the paper contains a theoretical application of the index to a model of optimal taxation it is conventional to assess the merits of alternative public policies in terms of a trade off between equity and efficiency in practice however a change in say the tax system involves three effects first it may have incentive or disincentive effects leading to efficiency gains or losses secondly it may alter the distribution of welfare levels thirdly it may alter the ranking of individuals or households within the distribution these three effects correspond to efficiency vertical equity and we shall argue certain aspects of horizontal equity respectively and any assessment of a tax change must take into account all three the principal assumption of this paper is that government is concerned about the trade off between these three effects a strict utilitarian is concerned only with the consequences of an action and in the evaluation of a particular reform a utilitarian measure of social welfare is defined over the vector of ex post utilities no account is taken of the process by which the vector of ex ante utilities is mapped into the ex post vector and no ethical status is awarded to the ex ante distribution one does not have to adopt an entitlement theory of justice to believe that the utilitarian approach may ignore some relevant considerations such as the fairness of the redistributive process a striking example of this arises in the model used by mirrlees 11 to examine optimal income taxation in that model individuals have identical preferences defined over consumption and leisure and differ only in respect of their potential wage rates or ability levels clearly in the absence of taxation individual utility is an increasing function of ability suppose the government uses redistributive lump sum taxes to achieve the first best optimum then as mirrlees 11 12 shows the first best optimum for a utilitarian social welfare

the internalisation theory of the multinational enterprise a review of the progress of a research agenda after 30 years this paper reviews the progress of the research agenda initiated by the future of the multinational enterprise 1976 focusing initially on the problem of explaining the existence of the multinational enterprise the agenda soon broadened to encompass the analysis of alternative modes of foreign market entry the role of international joint ventures the impact of innovation on corporate growth and the role of culture in international business the core philosophy based on the coasian nature of the firm and on rational action modelling has remained constant while the widening range of applications has encouraged synthesis with theories developed in other fields of research success in answering any one question invariably generates new questions which must in turn be answered through a further extension of the theory and this dynamic continues to drive the development of the theory today internalisation theory has retained its validity and its vitality over the past 30 years and is currently being extended into new fields of international business research

normative indices for measuring social mobility this paper introduces relative and absolute indices of social mobility to each index there corresponds a different social welfare function when the symmetric mean of order 1 social welfare function is employed the relative index becomes the king 1983 index of social mobility

a measure of horizontal inequity politicians academicians and the general public alike have perceived that the status quo tax and transfer legislation creates inequities among living units tax laws create numerous situations in which living units with seemingly equal abilities to pay are taxed quite different amounts state by state differences in welfare eligibility rules benefit schedules and administrative procedures the general unavailability of cash welfare to childless nonaged healthy couples and single individuals and other features of transfer programs similarly provide vastly different levels of income support to units with equal needs advocates of major tax and welfare reform have marshalled such evidence into a central argument in favor of their proposals while there is wide agreement that the process of redistributing incomes abounds with inequities there have been few attempts to quantify their extent 2 this paper develops a measure of horizontal inequity and illustrates its use section ii discusses the concept of horizontal equity then builds upon familiar lorenz curve gini coefficient analysis to derive the inequity index the third part considers some problems of implementing the measure and illustrates it section iv provides a short conclusion

accounting for endogeneity when assessing strategy performance does entry mode choice affect fdi survival firms choose strategies based on their attributes and industry conditions therefore strategy choice is endogenous and self selected empirical models that do not account for this and regress performance measures on strategy choice variables are potentially misspecified and their conclusions incorrect i highlight how self selection on hard to measure or unobservable characteristics can bias strategy performance estimates and recommend an econometric technique that has been developed to account for this effect although this concern applies to a wide range of strategy questions to demonstrate its effect i empirically examine if entry mode choice acquisition versus greenfield influences foreign direct investment survival in specifications that do not account for self selection i find that greenfield entries have survival advantages compared to acquisitions this confirms previous findings however the significance of this effect disappears once i account for self selection of entry mode in the empirical estimates the results confirm that estimates from models that do not account for self selection of strategy choice can lead to incorrect or misleading conclusions

empirical measurement of horizontal inequity abstract horizontal inequity is the unequal treatment of equals a crucial problem arising when measuring its extent is how should differential treatment which has some equity justification be distinguished from that which does not the literature to date has suggested that genuine equals can be identified and thence the problem solved by adjusting incomes prior to calculations using equivalence scales the paper argues that there are some good reasons for considering an alternative approach labelled partial symmetry in this the emphasis is on measuring horizontal inequity within each group of households with the same equity relevant characteristics rather than on adjusting incomes and then using the same measure for all households in the population the approaches are compared theoritically with reference to summary indices based on the generalised entropy family and to the conditions required to make partial orderings of different redistributions exploratory empirical work suggests there has been a substantial reduction in the horizontal inequity of u k direct taxes between 1976 and 1981 whichever approach is used the sources of the inequity observed are analysed in detail

organizational entrainment and international new ventures from emerging markets organizational entrainment captures the temporal fit in the activity cycles between exchange partners we argue that organizational entrainment between international new ventures invs and their most important international customers positively moderates the relationship between the degree scope and speed of internationalization and performance of invs we test our hypotheses on invs from china india and south africa the results support the contingent role of entrainment for degree and scope of internationalization but not for speed findings suggest that when invs attain temporal fit with their most important international customers they can implement their strategic goals in international markets more effectively

relative price changes and inequality in the size distribution of various components of income this article uses a comprehensive model of economic inequality to examine the impact of relative price changes on inequality in the marginal distributions of various income components in which the marginal distributions are derived from a multidimensional joint distribution the multidimensional joint distribution function is assumed to be a member of the pearson type vi family that is it is assumed to be a beta distribution of the second kind the multidimensional joint distribution is so called because it is a joint distribution of components of income and expenditures on various commodity groups gini measures of inequality are devised from the marginal distributions of the various income components the inequality measures are shown to depend on the parameters of the multidimensional joint distribution it is then shown that the parameters of the multidimensional joint distribution depend on the relative prices of various commodity groups and several other specified exogenous variables thus knowle

the meaning and measurement of income mobility abstract income mobility may be seen as arising from two sources i the transfer of income among individuals with total income held constant and ii a change in the total amount of income available in this paper we propose several sensible properties defining the concept of income mobility and show that an easily applicable measure of mobility is uniquely implied by these properties we also show that the resulting measure is additively decomposable into the two sources listed above namely mobility due to the transfer of income within a given structure and mobility due to economic growth or contraction finally these results are compared and contrasted with other mobility concepts and measures in the literature journal of economic literature classification numbers d31 d63

optimal management of a confined groundwater system abstract dynamic programming is applied to a relatively simple economic and hydrologic model of a confined aquifer system in southwest montana to determine an optimal interseasonal allocation schedule the derived decision rule demonstrates the economic advantage of maintaining a confined groundwater system while localized intraseasonal loss of the artesian pressure may occur it is important to maintain this pressure from year to year because of its role in reducing extraction costs the welfare gap as measured by differences in the net present value of economic returns to the basin under an optimal use policy versus an uncontrolled common pool situation is not trivial sensitivity analysis indicates that assumptions about uniformity of land productivity vis a vis their impact on the shape of the returns function the discount rate and the level of electric power rates are particularly critical with respect to the magnitude of the commonality problem

non cooperative institutions for sustainable common pool resource management application to groundwater as demands for limited natural resources increase developing management institutions that ensure the sustainability of such resources is essential many natural resources are common pool resources cprs managed under different non cooperative cooperative and externally imposed management frameworks while early studies of non cooperative cpr management suggest inevitable tragedy of the commons here we discuss how users can avoid tragic outcomes by changing their decision making rationales and exploitation strategies even in a non cooperative environment this paper introduces and compares various types of non cooperative institutions that are available to manage cprs these management institutions are then applied using a numerical groundwater exploitation example to determine how different planning variables are affected by the choice of management institution results indicate that cpr users can improve their gains by considering the externalities and developing long term exploitation plans as opposed to short term plans with no consideration of externalities that result in rapid exhaustion of the resource and lead to the so called tragedy of the commons

legitimating first organizing activities and the survival of new ventures abstract the process by which firm founders create new organizations is of considerable interest to evolutionary theorists and entrepreneurship researchers this article tracks the life histories of 223 swedish new ventures started between january and september 1998 by a random sample of firm founders we explore the effect of legitimating activities on the hazard of disbanding and the transition to other firm organizing activities during their first 30 months of life we find that undertaking activities to generate legitimacy reduces the hazard of venture disbanding and facilitates the transition to other organizing activities

innis lecture equity and equality is horizontal equity he the most widely accepted principle of equity or does it stand in opposition to the advancement of human welfare this paper argues that the case for the he principle is not as straightforward as is usually thought and that it requires advanced notions of justice and well being the most likely ethical basis for he appears to combine a rawlsian maximin principle and a view of well being that allows for relative local comparison effects the paper also explores some of the dimensions of equality and well being along which the he principle can be applied and presents a number of examples showing how he considerations can provide an important input into policy analysis le principe d d equite horizontale he constitue t il le principe ethique le plus largement admis ou est il un frein a l avancement du bien etre cet article explique pourquoi les assises ethiques du principe d eh ne sont pas aussi claires qu il est parfois suggere et demontre que ce principe fait plutot appel a des notions avancees de justice et de bien etre les assises morales les plus susceptibles d appuyer le principe d eh semblent combiner un argument de type maximin rawlsien et une perspective du bien etre qui tient compte des effets locaux relatifs de comparaison le papier explore egalement certaines des dimensions de l egalite et du auxquelles le principe d eh peut etre applique et presente un certain nombre d exemples montrant en quoi de considerations de type eh peuvent influencer l analyse de politiques

labour supply welfare rankings and the measurement of inequality abstract this paper presents an analysis of inequality using utility based measures of welfare derived from different approaches to modelling household labour supplies the almost ideal demand system specification of preferences is selected for the estimation of a neoclassical household model and of individual decision models which incorporate different assumptions concerning the intra household distribution of income using the rosen 1976 tax perception methodology the study also explores the implications of a model which does not constrain time at home to leisure welfare rankings and inequality measures defined on equivalent income are compared for each type of model the analysis uses australian unit record data on 3 352 households drawn from the australian bureau of statistics 1981 82 income and housing sample survey file the results indicate the sensitivity of welfare orderings and inequality measures to the choice of decision model and to the specification of lump sum transfers between family members a comparative study of equivalent incomes and selected money income variables also illustrates the limitations of observed household and individual incomes as welfare indicators for the analysis of inequality and for policy design

extending the theory of the multinational enterprise internalization and strategic management perspectives this paper assesses the continued relevance of buckley and casson s 1976 book on the future of the multinational enterprise mne against a background of increasing criticism of transaction cost related scholarly work we demonstrate that the schism that can currently be observed in the field between international business and international management is misguided as the transaction cost internalization school may offer useful insights to both management scholars and managers for this to occur however it is necessary first to extend the empirical scope of transaction cost based reasoning to include the functioning of differentiated network mnes the paper suggests that buckley and casson s book still represents a beacon of clarity and a superb starting point for the study of the mne even if the complexity of this governance structure has grown far beyond what any international business scholar or even international management scholar could have predicted 25 years ago

a new measure of horizontal equity in this paper we propose a new measure of horizontal equity that overcomes many of the shortcomings of previous proposed measures our starting point is the observation that a well behaved social welfare function need not evaluate global vertical equity differences in after tax income using the same weights it applies to local horizontal equity differences even though this constraint has been applied in the past following work on the structure of individual preferences we show that a social welfare function can imply different preferences toward horizontal and vertical equity adopting the general approach to the measurement of inequality developed by atkinson 1970 we use such a social welfare function to derive measures of inequality that are decomposable into components naturally interpreted as indices of horizontal and vertical equity in particular the former index measures deviations from the fundamental principle that equals be treated equally finally we apply our new measure to two tax return data sets evaluating the degree to which the horizontal equity of the us personal income tax has changed over time and how horizontal equity would be altered by one version of recent proposals to do away with the so called marriage penalty this abstract was borrowed from another version of this item

revisiting international business theory a capabilities based theory of the mne an introduction to this issue of the journal of international business studies in which the author discusses a capabilities based theory of multinational enterprises mne is presented

new directions in entrepreneurship research with the kauffman firm survey data is a fundamental impediment to a better understanding of the multifaceted process of new firm creation with better data we can form a better understanding of the causes constraints and outcomes associated with the decision to launch a new business towards this end the kauffman foundation commissioned an eight wave panel of businesses that were formed in 2004 chronicling a single cohort s evolution from birth through important business milestones this issue of small business economics focuses on papers that use the kauffman firm survey to examine new research questions in entrepreneurship articles in this issue analyze new research topics in entrepreneurship as well as shed light on enduring questions in the literature

current issues in the economics of groundwater resource management the issue of groundwater management remains a practical concern in many regions throughout the world while water managers continue to grapple with the question of how to manage this resource in this article we attempt to bring the most advanced and appropriate tools to bear on the issue of resource allocation involving groundwater our objective is to demonstrate the state of the art in the literature on ways to think about this complex resource and to deal with the important economic issues emanating from its complexity we present the conceptual framework within which economists examine the elements interacting in the management of groundwater resources indicate why the role of the market is limited with respect to the price of this very complex resource and point to the mechanisms that can pull competitive groundwater price and quality graded quantity of groundwater in line with their equilibrium levels in particular we critically review economic models of groundwater use examine the potential for groundwater management discuss the difficulties encountered in the estimation of the relevant control variables of such models and identify the advantages and limitations of the instruments devised for the efficient use allocation of this resource finally we argue that devised regulatory schemes usually ignore the information and knowledge needed for their implementation and we suggest a core of conditions necessary for successful groundwater management reforms

the effects of well management and the nature of the aquifer on groundwater resources we compare groundwater use under collective well management in china where village leaders allocate water among households and under private well management where farmers either pump from their own wells or buy water from wells owned by other farmers villages are divided into connected or isolated groups depending on whether there are lateral groundwater flows between aquifers underlying a village and neighboring ones in rural china households under collective well management use less water even under collective management households located in connected villages use more water indicating that the connectedness of the aquifers may undermine leaders incentives to conserve water

competitive versus efficient extraction of a common property resource the groundwater case abstract in this paper socially optimal and private extraction of a common property aquifer are compared open loop equilibrium and feedback equilibrium in linear strategies have been computed to characterize private extraction the use of these two equilibrium concepts allows us to distinguish between cost and strategic externalities as long as the open loop solution captures only the cost externality and the feedback solution captures both the results show that strategic behaviour increases the overexploitation of the aquifer compared to the open loop solution however if the groundwater storage capacity is large the difference between the socially optimal and private extraction the latter characterized by a feedback equilibrium is negligible

the measurement of horizontal inequality an alternative approach to the measurement of horizontal inequality is developed this measure of inequality is based on an explicit social welfare function which is formulated so as to be consistent with the basic principles of social choice the arguments of the social welfare function are welfare functions that depend on prices total expenditure and the demographic composition of the household the level of horizontal inequality is defined to be the difference between the level of social welfare attained at a perfect horizontally egalitarian distribution of welfare and the level of social welfare attained at the existing distribution of individual welfare the level of horizontal inequality induced by the introduction of commodity taxes is evaluated for the united states over the period 1947 85 copyright 1989 by mit press

the evolution of the scientific productivity of highly productive economists this paper studies the evolution of research productivity of a sample of economists working in the best 81 departments in the world in 2007 the main novelty is that in so far as a productivity distribution can be identified with an income distribution we measure productivity mobility in a dynamic context using an indicator inspired in an income mobility index suggested by fields 2010 for a two period world productivity is measured in terms of publications weighted by the citation impact of the journals where each article is published in the periodical literature we study the evolution of average productivity productivity inequality the extent of rank reversals and productivity mobility for seven cohorts as well as the population as a whole we offer new evidence confirming previous results about the heterogeneity of the evolution of productivity for top and other researchers however the major result is that contrary to what was expected for our sample of very highly productive scholars the effect of rank reversals between the two periods on overall productivity mobility offsets the effect of an increase in productivity inequality from the first to the second period in the youngest five out of seven cohorts jel a11 a12 b41 d63 i32

redistributive effect progressivity and differential tax treatment personal income taxes in twelve oecd countries this paper decomposes the redistributive effect of the personal income taxes pits of twelve oecd countries into four components i an average rate effect ii a departure from proportionality or progressivity effect iii a horizontal equity effect and iv a reranking effect the product of i and ii indicates the vertical redistribution associated with the pit and the sum of iii and iv indicates the impact on the distribution of income of differential tax treatment the average tax rate is found to be low in france and high in the nordic countries and the pit is found to be most progressive in france ireland and spain and least progressive in denmark and sweden taking i and ii together denmark and the us achieve broadly similar levels of vertical redistributive effect differential treatment is found to have a much smaller effect on income redistribution as a proportion of redistributive effect than the vertical redistribution caused by progressivity though there are differences between countries these differences appear to be due principally to a different emphasis on deductions such as tax deductibility of mortgage interest payments and insurance premiums and on local income tax

the evolutionary view of the mne and the future of internalization theory kogut and zander s 1993 jibs article which developed an evolutionary perspective on the multinational enterprise mne has had three critical impacts on mne research first it has stimulated scholars to conduct more eclectic empirical analyses which should include both transaction cost related parameters and broader learning competence related variables second it has usefully argued that the rigorous study of mne behavior does not need to reply upon the williamsonian behavioral assumption of opportunism third it has implicitly suggested a new path to be followed by internalization theory scholars in order to remain relevant to the field of international business the transaction cost economics lens adopted in internalization theory clearly remains critical to any analysis of mne strategy with impacts on the boundaries of the firm in addition the co evolution of the mne s governance structure and its technological competences determines present and future strategy choices here both transaction cost considerations and learning effects influence strategy selection

fiscal capacity tax effort and optimal equalization grants in this paper we address the question how should the tax burden in a feder ation be distributed across the different jurisdictions so that the social cost of providing government services is minimized using optimal tax theory we derive formulas for the optimal equalization grants that equalize the social marginal cost of raising revenue across all provinces we show how the optimal equalization grants are related to a measure of tax effort based on the marginal cost of public funds and a measure of fiscal capacity that takes into account the elasticity of the tax base and its substitutability with other tax bases

preferences for redistribution in the land of opportunities this paper explores how individual preferences for redistribution depend on future income prospects in addition to estimating the impact of individuals socioeconomic background and of their subjective perceptions of future mobility we employ panel data to construct dobjectivet measures of expected gains and losses from redistribution for different categories of individuals we find that such measures have considerable explanatory power and perform better than dgeneral mobilityt indexes we also find that preferences for redistribution respond to individual beliefs on what determines one s position in the social ladder ceteris paribus people who believe that the american society offers equal opportunities are more averse to redistribution d 2004 published by elsevier b v

the internationalization of new and small firms a resource based view abstract this paper seeks to enhance understanding of the internationalization of small and medium sized enterprises smes the study focuses upon the following issues can the characteristics of principal founders businesses and the external environment at one point in time be used to explain at a later date whether a firm is still an exporter or a nonexporter whether exporting firms are larger in size than nonexporting firms whether exporting firms report superior performance than nonexporting firms and whether exporting firms are more likely to survive than nonexporting firms to address these questions this study draws upon a sample of 621 manufacturing construction and services businesses located in twelve contrasting environments in great britain surveyed first in 1990 91 and then re interviewed in 1997 a resource based view is reviewed to identify the range of factors encouraging some owner managed smes to enter export markets four categories of human and financial capital are examined general human capital resources the principal founder s management know how the principal founder s specific industry know how and a principal founder s ability to obtain financial resources that can act as a buffer against random shocks variables relating to resource availability in the external environment were also collected and considered control variables previous studies have highlighted substantial industry differences in the propensity for businesses to enter export markets as well as to survive the principal industrial activity of each business in 1990 91 was therefore considered a control variable variables collected during the 1990 91 survey were selected to explain variations in the propensity to export reported by surviving independent firms in 1997 after elimination of missing values the working sample was reduced to 116 independent firms for this study 86 nonexporters and 30 exporters in 1997 in addition the 21 variables were selected to explain variations in business size in 1997 profit performance relative to competitors reported in 1997 changes in employment over the 1990 91 to 1997 period and business survival over the 1990 91 to 1997 period 213 survivors and 395 nonsurvivors multivariate statistical analysis confirmed that previous experience of selling goods or services abroad is a key influence encouraging firms to export businesses with older principal founders with more resources denser information and contact networks and considerable management know how are significantly more likely to be exporters further businesses with principal founders that had considerable industry specific knowledge are markedly more likely to be exporters businesses principally engaged in the service sectors and those located in urban areas are significantly less likely to be exporters a key finding of this study is that the explanatory variables significantly associated with the propensity to export sales abroad are not the same as those significantly associated with selected size and performance measures the resource based explanatory variables selected fail to significantly detect employment growing firms over the 1990 91 to 1997 period they also fail to significantly distinguish surviving independent firms from nonsurviving firms results from this study will provide policy makers and practitioners with additional insights into the key resource based factors associated with the decision by new and small independent firms to export sales abroad practitioners and policy makers can focus upon the characteristics of principal founders businesses and the external environment to predict the subsequent propensity of an independent firm to be an exporter policy makers and practitioners who want more new and small firms to export outside their local areas may prefer to target their resources and assistance to the relatively smaller proportion of firms that have the business and principal founder profiles that are significantly associated with a firm being an exporter

strategic behavior and efficiency in the common property extraction of groundwater groundwater has always been regarded as a common property resource where entry is restricted by land ownership and private exploitation is inefficient in 1980 gisser and sanchez presented a first estimation of this inefficiency cornparing socially optimal exploitation with private competitive exploitation using a model with linear water demand average extraction cost independent of the rate of extraction and linearly decreasing with respect to the water table level they characterized the private exploitation of the aquifer assuming that farmers are myopic and choose their rate of extraction to maximize their current profits whereas optimal exploitation is obtained by maximizing the present value of the stream of aggregate profits their results show that if the storage capacity of the aquifer is relatively large the difference between the two systems is so small that it can be ignored for practical consideration this result has been called the gisser sanchez rule by nieswiadomy 1985 and it has and important policy implication regulation of the resource does not seem justified since the profits it brings are not very high 1

international income mobility abstract we perform a novel analysis of the international mobility of per capita gnp we find general but not unambiguous support for the notion that world income mobility increased between 1972 and 1992 counterpointing the increased inequality over this period

explaining the formation of international new ventures the limits of theories from international business research abstract international new ventures invs represent a growing and important type of start up an inv is defined as a business organization that from inception seeks to derive significant competitive advantage from the use of resources and the sale of outputs in multiple countries oviatt and mcdougall 1994 their increasing prevalence and important role in international competition indicates a need for greater understanding of these new ventures oviatt and mcdougall 1994 logitech as described in a case study by alahuhta 1990 is a vivid example of an inv its founders were from two different countries and had a global vision for the company from its inception the venture which produces peripheral devices for personal computers established headquarters in both switzerland and the u s manufacturing and r d were split between the u s and switzerland and then quickly spread to taiwan and ireland the venture s first commercial contract was with a japanese company using 24 case studies of invs we found that their formation process is not explained by existing theories from the field of international business specifically neither monopolistic advantage theory product cycle theory stage theory of internationalization oligopolistic reaction theory nor internalization theory can explain the formation process of invs these theories fail because they assume that firms become international long after they have been formed and they therefore highlight large mature firms they also focus too much on the firm level and largely ignore the individual and small group level of analysis i e the entrepreneur and his or her network of business alliances we propose that an explanation for the formation process of invs must answer three questions 1 who are the founders of invs 2 why do these entrepreneurs choose to compete internationally rather than just in their home countries and 3 what form do their international business activities take who are the founders of invs we argue that founders of invs are individuals who see opportunities from establishing ventures that operate across national borders they are alert to the possibilities of combining resources from different national markets because of the competencies networks knowledge and background that they have developed from their earlier activities following the logic of the resource based view of the firm we argue that the possession of these competencies is not matched by other entrepreneurs only the entrepreneur possessing these competencies is able to combine a particular set of resources across national borders and form a given inv why do these entrepreneurs choose to compete internationally rather than just in their home countries the founders of invs recognize they must create international business competencies from the time of venture formation otherwise the venture may become path dependent on the development of domestic competencies and the entrepreneur will find it difficult to change strategic direction when international expansion eventually becomes necessary as the founder of one inv explained the advantage of starting internationally is that you establish an international spirit from the very beginning mamis 1989 38 what form do their international business activities take founders of invs prefer to use hybrid structures i e strategic alliances and networks for their international activities as a way to overcome the usual poverty of resources at the time of start up this study has important implications for the practice of management in financing decisions relating to invs venture capitalists and other venture financiers should look for entrepreneurs who have a global vision international business competence and an established international network when entrepreneurs start invs they should create hybrid structures to preserve scarce resources finally given the path dependence of competence development founders of new ventures should consider whether establishing a domestic new venture with plans to later internationalize will be as successful a strategy as establishing a new venture that is international from inception

a new method for estimating the effects of fuel taxes an application to thailand this article proposes a new methodology for estimating the impact of fuel price and tax changes on the general price level and the distribution of income and applies a model to thailand using data for 1975 76 and 1981 82 because the model allows for pricing under international competition where tax increases must be partially absorbed in reduced factor income rather than always being passed on in higher consumer prices the results are significantly different from those generated by the more conventional cost plus pricing rule the inflationary impact of fuel tax changes is slight because of both the openness of the economy and the low energy intensity of manufacturing and other production in thailand in contrast taxes on imports engender price increases not only for imports but also for goods which substitute for imports the model also indicates that the net effects of taxes on petroleum products other than kerosene are progressive in their distributional impact relative to a tax on imports or consumption a main policy conclusion of the study is that fuel taxes could be used to increase both equity and allocative efficiency without inducing significant inflationary responses it follows that in the current circumstances of falling world oil prices developing countries could generate revenues needed for structural adjustment by increasing fuel taxes to maintain domestic petroleum price levels

sequencing the expansion of geographic scope and foreign operations by born global firms born global firms are not actually born global but rather internationalize rapidly from their inception by expanding their geographic scope and extent of foreign operations however it remains unclear whether such firms 1 simultaneously expand along both dimensions 2 focus on expanding along a single dimension at a given time and switch interchangeably between expanding geographic scope and extent of foreign operations in subsequent periods or 3 stick solely to a specific internationalization path over several subsequent periods this study theorizes and empirically demonstrates that born global firms stick to a dominant internationalization path over subsequent periods arguably this phenomenon reflects managerial efforts to reduce the perceived risk of internationalization and their preference to develop and leverage capabilities that are specific to either of the internationalization paths until the economies of further expanding this path are exhausted

timing is everything curvilinear effects of age at entry on new firm growth and survival and the moderating effect of ipo performance abstract theory suggests that an earlier age at international entry results in improved growth but also decreased survival chances empirical studies tell a different story providing mixed and equivocal results that challenge the tenets of extant theory to begin to bridge the gap between theory and results we develop theoretical explanations for curvilinear inverted u shaped relationships between age at entry and both firm growth and firm survival as well as the moderating impact of resource providing initial public offering ipo on the resource intensive internationalization process our findings support the inverted u shaped relationships and that ipo performance steepens the growth curve and flattens the survival curve taken together our study enhances understanding of the effects of age at entry bridges the ipo and international entrepreneurship literatures and offers avenues for extending the micro foundations of the development of capabilities for new foreign market entry in doing so we advance knowledge about the conditions under which earlier or later internationalization leads some firms to thrive while others fail

equity and policy effectiveness with imperfect targeting abstract we propose a general approach that jointly integrates horizontal and vertical equity criteria in the assessment of poverty alleviation programs with the strength of each criterion being captured through its own inequity aversion parameter this contrasts with the assessment of poverty alleviation programs done with simple under coverage and leakage ratios or with other methods that do not take into account the heterogeneity of the poor and that do not address directly the social benefits of achieving normative criteria our methodology is illustrated using tunisian data and two alternative poverty alleviation policies we find inter alia that the social ranking of commodity and socio demographic targeting in tunisia depends on the policymaker s comparative preference for vertical and horizontal equity

utilitarianism and horizontal equity the case for random taxation this paper establishes that far from being able to derive the principle of horizontal equity from utilitarianism the principle is actually in consistent with utilitarianism in a variety of circumstances we derive conditions under which a it is optimal to impose random tax schedules ex post randomization and b it is optimal to randomize the tax schedules imposed on a set of otherwise identical individuals ex ante randomization the implications for optimal tax theory are discussed more generally it is shown that there are a number of potentially important economic situations with which the principle of horizontal equity may be inconsistent not only with utilitarianism but even with pareto optimality this abstract was borrowed from another version of this item