unionization and labor market institutions in advanced capitalism 1950 1985 this article examines the depedence of unionization on labor market institutions and long run trends in inflation unemployment and the sectoral composition of the labor force in 18 oecd countries the large number of contending explanations highlights the difficulty in comparative sociology of drawing confident conclusions when there are few cases to compare this problem is addressed through diverse evidence a review of the comparative historical record and a time series analysis to form a bayesian prior distribution which is combined with a cross sectional data set to sharpen conventional estimates of economic and institutional effects this analysis indicates working class organization in trade unions expanded in the postwar period where labor acquired an institutional influence over capitalist labor markets

trade union growth in ireland and the interdependence of the irish and united kingdom labor markets abstract this paper finds that the unemployment rate differential between ireland and the united kingdom is an important determinant of the rate of irish trade union growth

information inequality and mass polarization ideology in advanced democracies growing polarization in the american congress is closely related to rising income inequality yet there has been no corresponding polarization of the u s electorate and across advanced democracies mass polarization is negatively related to income inequality to explain this puzzle we propose a comparative political economy model of mass polarization in which the same institutional factors that generate income inequality also undermine political information we explain why more voters then place themselves in the ideological center hence generating a negative correlation between mass polarization and inequality we confirm these conjectures on individual level data for 20 democracies and we then show that democracies cluster into two types one with high inequality low mass polarization and polarized and right shifted elites e g the united states and the other with low inequality and high mass polarization with left shifted elites e g sweden this division reflects long standing difference

working class strength by institutional design unionization partisan politics and unemployment insurance systems 1870 to 2010 many studies have found that countries with union administered unemployment insurance have higher rates of unionization than countries with state administered unemployment insurance with data goin

the changing size distribution of u s trade unions and its description by pareto s distribution the size distribution of trade unions in the united states and changes in this distribution are documented because the most profound changes are taking place among very large unions these are subject to special analysis by invoking pareto s distribution this represents a new application of this distribution extensions to trade union wealth and to britain are broached the role of the public sector in these changes receives particular attention a simple model helps account both for the logarithmic distribution of union membership and for the contrasting experiences of public and private sector unions since the 1970s

imports domestic production and transnational vertical integration a theoretical note suppose a developing country has the choice of importing cars i or producing them at home in a subsidiary s of a transnational company or in a domestic firm under a licensing l contract from a transnational which ties the import of components from the latter if the criterion of national benefit is given by consumer surplus under i or s and by consumer surplus plus the profits of the domestic firm under l we compare the benefits from the alternative regimes i s or l under different market structure assumptions in most cases the regime s seems to dominate the conclusions are then modified by pointing to factors excluded from the basic model

entry strategies for multinational enterprises and host countries abstract a multinational enterprise mne has a number of investment strategies to enter into a foreign market such as foreign direct investment fdi joint venture jv exclusive licensing el and others in contrast a host government also has the choice to introduce a suitable entry strategy into its local market with the objective of maximizing its tax revenue or national social welfare in this paper we explore the optimal strategies for not only a mne but also a host country

the role of the desire for union status in the decision to enter local government job queues the us evidence following a two stage bivariate probit approach this study estimates local government and union job queues in a simultaneous equations framework by relaxing the restrictive assumption of independence between the worker s queuing and the employer s hiring decisions it overcomes a major limitation of most of the earlier job queue estimates the results indicate that the worker s queuing decision for local government jobs in the united states is determined partly by the desire for unionized employment the converse however is not true seniority with the current employer emerges as a significant determinant of both workers queuing and employers hiring decisions furthermore local governments act as model employers by being more likely to hire minorities and females from the pool of job applicants

the rising skill premium and deunionization abstract during the past 50 years the us economy has seen a rapid decline in labor union membership and a substantial rise in wage inequality since labor unions compress wages between skilled and unskilled workers a rising skill premium encourages skilled workers to withdraw from the union if this withdrawal is accompanied by a fall in the productivity of unskilled workers firms become reluctant to hire the relatively expensive union workers reinforcing the decline in the unionization rate evaluating this hypothesis we find that the rise in the skill premium explains about 40 of the decline in the unionization rate

federal and union job queues further evidence from the us labour market recent research on union differentials suggests that although the premium to unionization is higher in the private sector it can hardly be ignored in the federal sector consequently the nature and length of the federal queue may differ between union and non union sectors similarly the union queue may not necessarily be homogeneous between federal and private sectors we estimate separate queues for federal union federal non union and private union jobs from the same sample this avoids the problem of simultaneity between the federal queue and the union queue in addition it explores several important differences that exist between these queues

openness external risk and volatility implications for the compensation hypothesis a central assumption in the globalization literature is that economic openness generates economic insecurity and volatility based on this assumption schol ars of international political economy have proposed the compensation hypothesis which claims that globalization bolsters rather than undermines the welfare state by increasing public demand for social protection against externally generated eco nomic instability the openness volatility link is dubious however on both theoret ical and empirical grounds in this study i revisit the volatility assumption focusing on a crucial difference between openness and external risk in their effect on volatil ity my statistical analysis of a panel data set from 175 countries 1950 2002 finds a consistent effect of external risk on volatility of the major economic aggregates but a largely insignificant effect of openness these findings suggest that economic volatility may be a mistaken link in explaining the openness spending nexus calling for further research on the causal mechanisms linking the two the general growth of government in the post world war ii era is one of the most important empirical regularities in political science measured by general govern ment consumption or sectoral expenditures government size grew dramatically during most of the postwar period intrigued by this phenomenal government growth political scientists offered numerous accounts some viewing this growth as a corollary of economic phenomena such as modernization industrialization income distribution or fiscal illusion and others attributing government growth to political causes such as bureaucratization interest group politics and electoral competition 1

national ownership requirements and transfer pricing abstract this paper examines the interaction between a national ownership requirement and transfer pricing it turns out that where indigenization implies managerial control by domestic owners it may result in greater retained profits and a more intensive use of domestic resources

the economics of worldwide stagflation the last fifteen years have witnessed dramatic changes in economics not only in the manner in which the economics profession views economics but also in the manner in which the general public views economics and economists by the late 1960 s there had emerged more or less a consensus macroeconomic framework that is an agreed upon structure to be used to study economic problems at the aggregate level robert solow stated as quoted in leijonhufvud 1968

the multinational firm and exhaustible resources a multinational firm trading in exhaustible resources is examined the exhaustibility of the transferred good requires the generalization of some existing concepts and introduces some new results the optimal extraction strategy is examined and comparative static implications of government policies are established the performance of the multinational is compared with the outcomes that arise in the absence of a multinational under varying assumptions concerning the nature of the market in the latter case the behaviour of the firm is seen to depend crucially upon the transfer price limitations imposed by the governments this issue is complicated by the lack of an obvious set of such limitations

understanding the behavior of bank spreads in latin america abstract over the last decade many countries in latin america have eliminated interest rate ceilings reduced reserve requirements and stopped direct credit controls these market oriented reforms have encouraged financial deepening thereby producing considerable economic benefits to the countries nevertheless the persistence of high interest rate spreads has been a disquieting outcome of the reforms this paper explores the determinants of bank spreads in a systematic way for argentina bolivia chile colombia mexico peru and uruguay during the mid 1990s the analysis shows that high operating costs raise spreads as do high levels of non performing loans although the size of these effects differs across the countries in addition reserve requirements in a number of countries still act as a tax on banks that gets translated into a higher spread beyond bank specific variables uncertainty in the macroeconomic environment facing banks appears to increase interest spreads the combination of these microeconomic and macroeconomic factors is a cause for concern in latin america as spreads widen the cost of using the financial system becomes prohibitive to some potential borrowers in addition the results suggest that bank capital requirements may not prevent excessive risk taking by banks when bank spreads are high

the determinants of bank interest margins theory and empirical evidence this paper has developed a model of bank margins or spreads in which the bank is viewed as a risk averse dealer it was demonstrated that an interest spread or margin would always exist and that this was the result of transactions uncertainty faced by the bank moreover it was shown that this pure spread depended on four factors the degree of managerial risk aversion the size of transactions undertaken by the bank bank market structure and the variance of interest rates the model implied that liability and asset structures had to be analyzed together since they were directly interrelated through transactions uncertainty it was shown that because of this transactions uncertainty hedging behavior was perfectly rational within an expected utility maximizing framework extending the model from a structure with one kind of loan and deposit to loans and deposits with many maturities should lead to further interesting insights into margin determination especially as portfolio effects may become apparent

diversification in banking is noninterest income the answer this paper assesses potential diversification benefits in the u s banking industry from the steady shift toward activities that generate fee income trading revenue and other types of noninterest income in the aggregate declining volatility of net operating revenue reflects reduced volatility of net interest income not diversification benefits from noninterest income which is quite volatile and increasingly correlated with net interest income at the bank level greater reliance on noninterest income particularly trading revenue is associated with lower risk adjusted profits and higher risk this suggests few obvious diversification benefits from the ongoing shift toward noninterest income

union organizing costs and benefits this paper examines the costs and benefits to current union members in manufacturing of programs to organize the unorganized the marginal cost of organizing an additional employee in constant dollars is estimated for a sample of unions between 1964 and 1977 the primary benefit of organizing that is quantifiable is the extent to which the maintenance or extension of union coverage permits the maintenance of or increase in the union wage estimates of this benefit are derived from previous econometric research linking the union wage to the percentage of the industry organized this single benefit is found to be larger than the estimated marginal cost of extending union coverage in 19 of 20 manufacturing industries

on the political economy of welfare expansion a comparative analysis of 18 advanced capitalist democracies 1960 1971 this article elaborates the thesis that economic growth and various types of collective action by class linked actors determine the expansion and decline of welfare spending in rich capitalist democracies our multivariate model of this thesis specified to 1960 1971 growth rates in direct cash transfer payments as proportions of gross domestic product is supported strongly by regression analyses these indicate that economic growth notably facilitates transfer payment growth they also suggest that rightist party participation in government notably dampens welfare expansion while leftist centrist and christian democratic party participation in government are conducive to welfare expansion and they suggest that the political influences of both unions and large industrial corporations are conducive to growth in transfers payments as well in addition state authorities appear to augment welfare spending in response to working class protests strike activity and capital investment disinvestment activ

structural stability in models of american trade union growth recent interest in trade union activity has led to the development of econometric models of union membership growth this paper examines the structural stability of two of the leading models ashenfelter pencavel s and bain elsheikh s each of which claimed to have captured the primary determinants of union growth in the twentieth century the models were reestimated using revised corrected and extended membership data and a nonlinear maximum likelihood procedure was employed to estimate the shift point for each model contrary to previous studies we found evidence of a break in the structure of each model and unlike earlier work that hypothesized a world war ii break point our estimated point was 1937 1938 most likely reflecting the impact of the wagner act

public sector unions and public spending this study examines the influence of public sector unions on the expansion of the public sector based on public goods theory our paper models how unions influence the supply of and demand for public sector activities on the demand side public sector unions are special interests which advocate public sector expansion to policy makers on the supply side they exert pressure to maintain and expand monopoly powers empirical evidence supports the hypothesis that a positive relationship exists between public sector unionism and public spending

accounting for the decline in union membership 1950 1980 this study analyzes the components of the post 1950 trends in the share of the private work force organized by unions which rose from 1950 to 1954 and then fell steadily to 1980 the authors decompose the sources of growth and decline into changes in organizing activity success in certification elections losses from decertification elections and net growth due to economic causes the last a residual measure designed to capture the effect of factors such as plant closings layoffs and new hires they find that all factors except decertifications accounted for a substantial part of the decline since 1954 when the level of aggregate economic activity is held constant loss of membership due to other economic causes shows no downward trend a finding that challenges the view that the decline in the unionized share of the work force has been due primarily to a secular decline in employment in the strongly unionized industries

understanding the greek crisis this paper focuses on the distortions that the greek public debt has imposed on the greek banking system and suggests how these can be unwound the low level of competitiveness of the greek economy which is well below the competitiveness of the developed countries poses a great challenge for the greek banks at the same time it puts at risk greece s economy ability to service both the private and public debt which as an aggregate are comparable to the indebtedness of the developed nations an adjustment of economic activity to match the current low level of competitiveness will increase the risks faced by the financial system and make an orderly servicing of the debt of the economy very challenging it follows that only one reasonable policy option remains to increase the competitiveness of the economy through an aggressive reform agenda so that it will match its level of indebtedness and through the resulting growth shift the excessive debt of the public sector to the private sector

bayesian inference for comparative research rv egression analysis in comparative research suffers from two distinct problems of statistical inference first because the data constitute all the available observations from a population conventional inference based on the long run behavior of a repeatable data mechanism is not appropriate second the small and collinear data sets of comparative research yield imprecise estimates of the effects of explanatory variables we describe a bayesian approach to statistical inference that provides a unified solution to these two problems this approach is illustrated in a comparative analysis of unionization a widely used tool in quantitative comparative politics is the linear regression model estimating relationships between institutional and economic variables observed for a set of countries constituting some population of interest a brief survey of recent comparative research finds no shortage of work of this type for instance remmer 1991 identifies economic crisis as a source of electoral volatility in latin american countries in the 1980s robertson 1990 presents evidence that institutions moderating the transaction costs of negotiations between capital and labor reduce industrial conflict and golden 1993 finds that union wage moderation in industrialized democracies results from coordinated collective bargaining although the methodological advantages are well documented jackman 1985 we identify two distinct problems of statistical inference endemic to this type of quantitative comparative research first because the data constitute all the available observations from a population conventional inference based on the long run behavior of some repeatable data mechanism is not appropriate second because data sets tend to be small and collinear the effects of explanatory variables are estimated imprecisely in most applications the first problem is generally ignored and the second is solved by imposing restrictions on the regression model to obtain sensible results the bayesian model of statistical inference provides a unified solution to these two distinct problems of quantitative comparative research two features of bayesian inference are important in this context first probability is conceived subjectively as characterizing a researcher s uncertainty about the parameters of a statistical model this subjective probability concept seems particularly useful in comparative settings where the data are typically convenience samples not generated by a known probability mechanism such as random sampling second bayesian inference allows the inclusion of other information in addition to the quantitative sample information again this seems useful in the comparative context where rich historical material is commonly available sparking ideas for researchers but formally discarded in the final analysis in the bayesian approach this historical material can be formally incorporated into the analysis we begin by detailing why the nonstochastic and weak data typical of comparative research are problematic for conventional linear regression analysis we next introduce some ideas about bayesian inference and describe bayesian regression analysis these ideas are applied to a comparative analysis of unionization the subject of a recent exchange in the american political science review between michael wallerstein and john stephens stephens and wallerstein 1991 wallerstein 1989 the bayesian regressions we present are supplemented with a sensitivity analysis that investigates how our conclusions depend upon the sample data and our prior beliefs although we survey some ideas in bayesian statistics a full introduction to the bayesian approach to statistical inference is beyond our scope here good book length treatments are pollard 1986 lee 1989 and at a slightly higher level press 1989 our intention here is to spotlight problematic but ignored issues of statistical inference in a common area of application the bayesian alternative that we present represents just one way forward to address these inferential problems

social democracy christian democracy constitutional structure and the welfare state the literature on the determinants of welfare state effort displays many inconsistencies and contradictins this article takes imoprtant stepts toward resolving these issues with the use of pooled

international technology transfer with an information asymmetry and endogenous research and development abstract in this paper an information asymmetry concerning technology type and the cost of operating across national boundaries interact with location considerations to determine whether international technology transfer occurs via the export of goods subsidiaries or licensing it is shown that market share restrictions and per unit royalties can signal technology type and make licensing the most attractive option in addition it is shown that policies which restrict the mode of technology transfer do not necessarily reduce the amount of research and development undertaken

externalities and technology transfer through multinational corporations a theoretical analysis abstract this paper examines the optimal behavior of a multinational firm s subsidiary in a host country when learning of its production techniques by its native rivals occurs in a dynamic framework it is shown among other things that a it is worthwhile for the subsidiary to import better technology from its parent firm and that b such technology transfer may not benefit the firms of the host country despite their learning while the host country as a whole does benefit

bank competition financial reform and institutions the importance of being developed abstract in this paper i estimate the degree of market power at the bank level for 84 banking systems worldwide subsequently i analyze the sources of bank competition placing emphasis on the impact of financial reform and the quality of institutions i find that financial liberalization policies reduce the market power of banks in developed countries with advanced institutions in contrast banking competition does not improve at the same pace in countries with weaker institutions and a lower level of institutional development the results hold across a wide array of identification tests and estimation methods the main policy implication to be drawn is that a certain level of institutional development is a precondition for the success of reforms aimed at enhancing the competition and efficiency of banking markets

technology transfer licensing and the speed of endogenous technological change abstract as licensing contracts usually require the licensee firm to purchase tied inputs from the seller of the technology the licensee firm has an incentive to embark on an r d program for development of substitutes for the tied inputs this paper characterizes the licensee firm s optimal speed of r d and the optimal expected date of switch over to the substitute inputs in an infinite horizon model under uncertainty about the timing of success of the r d program the effects of different government subsidies or taxes changes in input prices and other parameters on the optimal speed of r d and on the expected date of switchover to the substitute are also investigated it is also shown that strategic behavior by the seller of the technology may delay the development of the substitute by the licensee firm

do institutions really matter taxation in industrialized democracies new institutionalism has emerged as one of the most prominent research agendas in the field of comparative politics political economy and public policy this article examines the role of institutional variation in political economic regimes in shaping tax burdens in industrialized democracies an institutionalist model for tax policy variation is tested across the organization for economic cooperation and development oecd democracies countries are conceptualized and statistically modeled in terms of majoritarian shifting coalition and dominant coalition governments regression analysis and cluster analysis are used to statistically model crossnational tax burdens relative to the strength of labor organization and party dominance in parliament this study finds that political and economic institutions are important in explaining tax policy variation specifying the structure of political and economic institutions helps to explain the size of the state in modern capitalist democracies this article specifies and demonstrates which institutions matter and how much they matter

non cooperative bargaining theory an introduction the paper provides an informal introduction to some of the main themes of the recent literature on non cooperative or sequential bargaining models it focuses in particular on the relationship between the new approach and the traditional axiomatic approach exemplified by nash bargaining theory it illustrates the new insights offered by the non cooperative approach by reference to a detailed analysis of the manner in which the presence of an outside option available to one of the parties will affect the negotiated outcome finally the difficulties which arise in extending this analysis to two person bargaining with incomplete information and to n person bargaining are discussed this is a revised version of the fourth review of economic studies lecture presented in april 1985 at the joint meeting of the association of university teachers of economics and the royal economic society held in oxford the choice of lecturer is made by a panel whose members are currently professors hahn mirrlees and nobay and the paper is refereed in the usual way this paper aims to provide an informal and elementary introduction to an approach to bargaining which has received a great deal of attention over the past few years the approach involves writing down some particular sequence of moves offers and replies to be made over time in the course of negotiations and then looking for a non cooperative equilibrium in the game thus specified in practice a perfect equilibrium or in games of incomplete information a sequential equilibrium while the approach appears at first sight to be very different in spirit from the traditional axiomatic approach in which a bargaining solution is specified by appealing to a number of general requirements which are deemed appropriate on the basis of some a priori considerations the two approaches are in fact complementary while the

unemployment collective bargaining and the demand for protection there is a widespread consensus among nonacademic observers that labor unions with large numbers of unemployed members have been central actors in political coalitions demanding protectionist trade policies since the mid 1970s in advanced industrial societies yet trade unions and unemployment are hardly mentioned in most theories of the politics of international trade the purpose of this paper is to develop a theoretical framework for understanding the importance of unemployment as a determinant of protectionist demands that is consistent with optimizing behavior on the part of union members and firms models of labor negotiations derived from cooperative bargaining theory are used to illustrate why the material benefits of protection received by union members and their employers in protected industries increase when union members are unemployed even when workers are risk neutral and capital is immobile

trade union growth in ireland 1943 1977 abstract this paper reports some results which were obtained when the bain and elsheikh model of union growth was employed in an analysis of the irish experience during the period 1943 to 1977

union organization in advanced industrial democracies i suggest a new explanation of cross national differences in unionization rates the size of the labor force size matters because the gains unions are able to achieve in collective bargaining depend on the proportion of substitutable workers who are organized while the costs of organizing depend in part on the absolute number to be recruited the comparison of the costs and benefits of organizing new workers yields the conclusion that unions in larger labor markets will accept lower levels of unionization statistical analysis of cross national differences in unionization rates among advanced industrial societies in the late 1970s indicates that the size of the labor force and the cumulative participation of leftist parties in government explain most of the variance

determinants of commercial bank interest margins and profitability using bank level data for 80 countries in the years 1988 9s this article shows that differences in interest margins and bank profitability reflect a variety of determinants bank characteristics macroeconomic conditions explicit and implicit bank taxation deposit insurance regulation overall financial structure and underlying legal and institutional indicators a larger ratio of bank assets to gross domestic product and a lower market concentration ratio lead to lower margins and profits controlling for differences in bank activity leverage and the macroeconomic environment foreign banks have higher margins and profits than domestic banks in developing countries while the opposite holds in industrial countries also there is evidence that the corporate tax burden is fully passed onto bank customers while higher reserve requirements are not especially in developing countries

estimation of the us federal job queue in the presence of an endogenous union queue past research on the federal sector job queue fails to incorporate the important role of unioniz ation we estimate a two stage bivariate probit in which the willingness of a worker to queue for a union job enters the estimation of the federal queue we demonstrate that the failture to implement our approach may lead to the inappropriate conclusion that there does not exist a federal queue in the us labour market we identify the characteristics that lead workers to seek employment in the federal sector and as a byproduct also provide independent confirm ation of the presence of a queue for union jobs ability in bivariate probit models to examine job queues abowd and farber 1982 use poirier s technique and find evidence of a queue of workers waiting for union jobs they estimate separate equations determining which character istics make a worker more likely to enter the queue and which characteristics make a worker more likely to be chosen from the queue indeed farber 1983 leigh 1985 and heywood 1990 have all reaffirmed the existence of a union queue under varying degrees of partial observability recently venti 1987 krueger 1988 and heywood and mohanty 1990 have examined whether or not a queue exists for federal government jobs while this research confirms the existence of a federal queue it fails to incorporate the earlier research indicating the presence of a union queue indeed none of the authors controls for any dimension of unionization in the federal queue esti mates this failure is problematic for several related reasons first heywood and mohanty 1994 demonstrate that statistical confirmation of a federal job queue is highly sensitive to specification particularly the inclusion or exclusion of specific variables 2 second the federal sector is far more heavily unionized than the private sector see freeman 1986 1988 ichniowski 1988 and reder 1988 thus if the earlier research is correct and workers do queue for union

politics institutions and welfare spending in industrialized democracies 1960 82 electoral turnout as well as left and center governments increase welfare effort that the welfare efforts of governments led by particular types of parties show significant differences and vary notably with the strength of oppositional and junior coalitional parties and that relatively neocorporatist centralized and traditionalistic polities are high on welfare effort overall our findings suggest that contrary to many claims both partisan and nonpartisan facets of democratic politics and political institutions shape contemporary social welfare effort

a theory of joint venture life cycles abstract in this paper we provide a dynamic theory of joint venture life cycle that relies on synergy organisational learning and moral hazard we demonstrate that depending on parameter values the outcome may involve any one of the following stable joint venture formation joint venture formation followed by breakdown or cournot competition in all the periods we also provide some interesting welfare results

decomposition of structural and exogenous changes 1989 decomposition of structural and exogenous changes applied economics vol 21 no 1 pp 125 137

a dynamic model of union membership and employment that it recognizes some link between present wage and employment levels and future membership and that it has an interest in the level of membership attained we model membership decisions with stochastic demand and a differential layoff rate for union and non union workers membership dynamics are behavioural in that membership increases when the utility of being a member exceeds the utility of not being a member the model permits a variety of possible relationships between employment and membership in the adjustment to steady state

spillovers from foreign direct investment within or between industries this paper contributes an estimation framework to measure both technological and linkage externalities from foreign direct investment fdi empirical research dealt mainly with intra industry spillovers from fdi with restrictive treatment of inter industry effects until recently however as optimal organization of the multinational corporation mnc involves minimization of profit losses due to leakage of technical information to competitors host country firms within the mnc s sector experience limited productivity gains ensuing fdi host country producers in other sectors may benefit for example mncs transfer knowledge to local downstream clients or outsource to local upstream suppliers hence fdi substitutes within sector domestic investment but complements it across sectors the net impact on aggregate capital formation by host country producers hinges on the interaction between linkages and spillovers estimations based on the colombian manufacturing census yield the sectoral pattern of fdi spillovers displaying knowledge propagation between but not within industries the findings reveal outsourcing relationships of mncs with local upstream suppliers as the channel of diffusion

the determinants of net interest income in the mexican banking system an integrated model abstract this paper analyzes net interest income in the mexican banking system over the period 1993 2005 taking as reference the seminal work by ho and saunders ho t saunders a 1981 the determinants of banks interest margins theory and empirical evidence journal of financial and quantitative analysis xvi 4 581 600 and subsequent extensions by other authors our study models the net interest margin simultaneously including operating costs and diversification and specialization as determinants of the margin the results referring to the mexican case show that its high margins can be explained mainly by average operating costs and by market power although non interest income has increased in recent years its economic impact is low

welfare expenditures and the decline of unions to what extent has the increased supply by government of certain union like services reduced the demand for union membership and thereby contributed to the decline in trade union density the existing empirical evidence is meager and conflicting the puropse of our paper is to reexamine the government substitution hypothesis specifically with respect to the relationship between government welfare spending and union density we test the hypothesis with time series data using three alternative models of union growth the advantage of this approach is that it will permit an assessment of how sensitive the results are to both specification and sample period changes in all we find the time series evidence of a negative welfare effect on union density to be mixed copyright 1989 by mit press

the greek financial crisis growing imbalances and sovereign spreads abstract we discuss the origins of the greek financial crisis as manifested in the growing fiscal and current account deficits since euro area entry in 2001 we then extend a model typically used to explain risk premia to assess the extent to which credit ratings captured these premia next we estimate a cointegrating relationship between spreads and their long term fundamental determinants and compare the spreads predicted by this estimated relationship with actual spreads we find that spreads were significantly below what would be predicted by fundamentals from end 2004 up to the middle of 2005 by contrast since may 2010 actual spreads have exceeded predicted spreads by some 400 basis points

declining voter turnout in advanced industrial democracies 1950 to 1997 the effects of declining group mobilization past comparative voting behavior research has revealed that electoral institutions can explain much of the variation in voter turnout between nations this study takes an alternative and dynamic approach by identifying and explaining a pattern of turnout decline within industrial democracies which is beyond purely institutional explanation multivariate analysis of a pooled cross section of 18 industrial democracies between 1950 and 1997 suggests that turnout decline can best be explained in terms of changing patterns of group mobilization and electorate demographics the authors specifically point to the decline of unions and labor parties which have traditionally been associated with the mobilization of peripheral voters and the real increases in the cost of mobilization the authors control for institutional changes and find that they are less useful in explaining variation in turnout within advanced industrial democracies

trends in union organizing expenditures 1953 1977 this paper tests the charge by some observers that one reason for the decline in unions share of private sector employment has been a decline in their commitment to growth the author presents several measures of the organizing expenditures of 27 national unions representing about one half of all union members in this country over the 1953 77 period these data show that organizing expenditures rose significantly over that period whether measured in current or constant dollars although they declined slightly as a proportion of total union expenditures

the decline of unionization in the united states what can be learned from recent experience the dramatic decline in unionization over the last decade is investigated in the context of a supply demand model of union status determination using data from surveys of workers conducted in 1977 and 1984 along with data from the national labor relations board on representation elections it is concluded that the decline in unionization since 1977 is accounted for largely by 1 an increase in employer resistance to unionization probably due to increased product market competitiveness and 2 a decrease in demand for union representation by nonunion workers due to an increase in the satisfaction of nonunion workers with their jobs and a decline in nonunion workers beliefs that unions are able to improve wages and working conditions

explaining the dominance of legacy unions in new democracies comparative insights from indonesia the continued dominance of legacy unions state backed unions inherited from the previous nondemocratic regime has received little scholarly scrutiny through an analysis of indonesia this article presents a focused theoretical framework for analyzing the staying power of legacy unions and the strategies they pursue to maintain their dominance the author argues that the capacity of legacy unions to survive is a product of inherited advantages membership institutional and legal and the transition context economic conditions union competition and partisan links legacy unions adopt three strategies for survival carrots sticks and reform and pursue a strategy of reform only when they retain meager inherited advantages and face an unfavorable transition context the article also offers suggestions for additional research to further develop the theoretical framework

the political economy of international trade enduring puzzles and an agenda for inquiry a similar set of concepts has been central to the literatures on the formation of trade policy coalitions and the new economics of institutions the political and economic consequences of the degree to which assets are specific to a particular economic activity in this survey the authors take the necessary first step of summarizing the main findings of these two literatures and then suggest ways in which the issue might be joined in addition to providing a more coherent understanding of the findings of these two literatures and some new directions for them the authors show that many puzzles remain in the field of trade politics puzzles for which there are no appealing answers or where there are answers no strong evidence in support of them this essay then in addition to being a theoretical review of the literature puts forward an agenda for future study of international trade politics

on the possibility of credit rationing in the stiglitz weiss model contrary to what is consistently assumed in the literature the return function cannot be hump shaped in the stiglitz weiss 1981 model this has important consequences for the possible occurrence of credit rationing and redlining with a single class of borrowers banks offer credit in two stages demand possibly exceeds supply in stage one but not in stage two with several observationally distinguishable borrower classes the firms in a borrower class are redlined only under circumstances which imply that they would not get credit in a perfect capital market either die rendite funktion kann im stiglitz weiss 1981 modell nicht so wie das in der literatur durchgangig angenommen wird hugelformig sein das hat wichtige implikationen fur die moglichkeit von kreditrationierung einerseits und fur die moglichkeit des ausschlusses ganzer kreditnehmergruppen vom kapitalmarkt andererseits mit nur einer klasse von kreditnehmern erfolgt die kreditvergabe in zwei stufen wahrend auf der ersten stufe eine ubernachfrage vorliegen kann herrscht auf der zweiten stufe marktraumung bei mehreren unterscheidbaren kreditnehmerklassen wird eine klasse nur unter den bedingungen vom kreditmarkt ausgeschlossen bei deren vorliegen sie auch in einem vollkommenen kreditmarkt keinen kredit erhalten wurde

profit strategy of greek banks cross subsidization and diversification versus complementarity abstractthis study analyses the profit strategy employed by banks in greece using dynamic panel data techniques and a data set which includes proprietary supervisory data covering the whole greek commercial banking system from 2004 to 2011 we provide evidence that banks use interest and non interest income non ii as substitutes rather than complements with non ii representing an indirect competition instrument by the more efficient banks used in place of direct competition with their peers through prices on loans and deposits this behaviour is explained by further decomposing the non ii into the relatively stable fees component and the volatile trading income moreover we provide evidence that the net interest income is primarily affected by the banks market power and their operating costs while more efficient banks exploit their core deposit base to lever their non ii finally macroeconomic developments affect both income components which are found to be procyclical with respect to economic ac

the rise and fall of unions the public sector and the private as of the late 1980s american unionism as a whole has been in decline for about thirty years this decline has been concentrated in the unions serving workers in the private sector and contrasts sharply with the growth of public sector unions during much of the same period this paper attempts to explain these divergent trends but takes their existence as given by decline or rise of unionism i refer to changes in the percentage relative number of union adherents among a specified group of workers though i believe that movements in the relative number of union adherents have run parallel to broader but more vague movements of union influence the reader must draw such inferences for himself as best he can a union adherent is assumed to be both a dues payer and covered by a collective bargaining contract possible differences between these two concepts of union affiliation are unimportant for this paper individuals are assumed always to act as if they had compared the costs and benefits of union adherence and chosen adherence if the benefits were greater and otherwise if the opposite applied as used here costs and benefits are limited to hourly compensation wages and fringes employment opportunities and working conditions while ideological preferences undoubtedly influence a small minority of workers it is assumed that such individuals are too few to affect the trends analysed 1 the above assumptions obscure important interdependencies among the decisions of individual workers and those of an employee and his employer for example if an 1i do not deny either that changes in attitudes toward the relative desirability of working under union conditions may have occurred from time to time or that such changes might be of interest however i assume that the dominant factors affecting movements in the quantity of union adherents are changes in the benefits and costs of unionization particularly hourly compensation and employment opportunities

postwar unionization in eighteen advanced capitalist countries unionization follows strongly divergent patterns among oecd countries in the postwar period i propose business cycle demographic and political arguments to explain varying unionization over time centralized union movements that engage in corporatist bargaining and union disbursement of unemployment benefits suggest explanations of crossnational variability in unionization analysis of annual data for 18 oecd countries from 1950 to 1985 indicates strong positive effects of union centralization and union disbursement of unemployment benefits on unionization union centralization also shapes the longitudinal effect of strike activity on unionization while union disbursement of unemployment benefits positively influences longitudinal effects of unemployment and employment growth results suggest that labor movementsflourish when they establish an institutional control over labor market outcomes beyond wage bargaining when labor s institutional control is weak worker militancy may encourage working class organization in trade unions

the relationship between net interest margin and noninterest income using a system estimation approach abstract this paper examines the determinants of bank net interest margin nim and non traditional banking activities nii a system estimation approach is employed to control for the simultaneity between nim and nii for commercial banks in a group of 28 financially liberalized countries during the period between 1997 and 2004 we find a statistically significant negative relationship between nim and nii for the period between 1997 and 2002 a generally positive but statistically insignificant association between nim and nii is found for the subsequent period 2003 2004 banks increasing involvement in non traditional activities is negatively correlated with risk adjusted profitability measures in the former subperiod suggesting no obvious diversification benefits however the share of noninterest income is positively related to the return on assets roa and the return on equity roe for the latter subsample

where have all the union members gone this paper examines trends in union membership during the twentieth century the hypothesis is advanced that the provision of certain social welfare benefits by government substitutes for the private provision by unions thereby reducing the attractiveness of union membership the empirical implications of this hypothesis are examined using time series data on aggregate union membership for the period 1904 80 and using pooled state data for the period 1964 80 these latter data are used to examine the effect of departures from the traditional doctrine of employment at will both the time series and the cross section evidence suggest that government supply of union like services reduces union membership

intellectual property rights and the mode of technology transfer abstract transferring technology in an environment where patent protection is uncertain can pose significant risks to an innovating firm s ability to appropriate rents this paper incorporates asymmetric information in a screening game where the innovating firm has the choices of licensing a new product at arm s length to a foreign firm exporting it or licensing it to a subsidiary subsidiary production avoids the risk of imitation but involves higher costs for the innovating firm the gains to the southern country from the lack of intellectual property right protection may be offset by strategic behavior by northern firms who opt for technology transfer via subsidiary or monopoly production

the determinants of bank interest rate margins an international study abstract this paper studies the determinants of bank net interest margins nims in six selected european countries and the us during the period 1988 1995 for a sample of 614 banks we apply the ho and saunders model ho t saunders a 1981 the determinants of bank interest margins theory and empirical evidence journal of financial and quantitative analyses 16 581 600 to a multicountry setting and decompose bank margins into a regulatory component a market structure component and a risk premium component the regulatory components in the form of interest rate restrictions on deposits reserve requirements and capital to asset ratios have a significant impact on banks nims the empirical results suggest an important policy trade off between assuring bank solvency high capital to asset ratios and lowering the cost of financial services to consumers low nims the more segmented or restricted the banking system both geographically and by activity the larger appears to be the monopoly power of existing banks and the higher their spreads macro interest rate volatility was found to have a significant impact on bank nims this suggests that macro policies consistent with reduced interest rate volatility could have a positive effect in reducing bank margins