institutions and growth in korea and taiwan the bureaucracy how do competent bureaucracies emerge in developing countries we examine bureaucratic reform in korea and taiwan and argue that in both cases political leaders had an interest in reforming the civil service to carry out their programmatic initiatives in addition both governments undertook organisational reforms that made certain parts of the bureaucracy more meritocratic while utilising centralised and insulated pilot agencies in overall policy coordination however we reject the approach to bureaucratic reform that focuses primarily on its efficiency enhancing effects if delegation bureaucratic and policy reform provided an easily available solution to the authoritarian s dilemma dictators would have more uniformly positive economic records rather we analyse the political and institutional constraints under which governing elites operate in doing so we underscore several important variations in the design of bureaucratic organisation which in turn mirror larger policy differences between th

measuring excess capital capacity in agricultural production we introduce the concept excess capital capacity and employ a stochastic input requirement frontier to measure excess capital capacity in agricultural production we also propose a two step estimation method that allows endogenous regressors in stochastic frontier models the first step uses generalized method of moments to get consistent estimates of the frontier parameters in the presence of endogenous regressors the second step uses maximum likelihood to measure excess capital capacity and evaluate the factors that influence it the empirical application to dutch cash crop farms found varying degrees of excess capital capacity the policy implications of excess capital capacity are discussed

china s shallow integration networked production and the new challenges for late industrialization summary chinese enterprises have become extensively linked with the global economy yet in a shallow manner they remain stuck in commodity manufacturing undifferentiated activities for which innovation is absent competition then revolves around cutthroat cost cutting this outcome stems from three factors first it reflects the new challenges to development posed by globally networked production second it reflects tensions between the political economic imperatives of successful post socialist transition and the institutional imperatives for upgrading in networked economies third it reflects uncertainty surrounding the adjustment of traditional industrial policy to the new demands of development through participation in global supply chains

a farm firm model of machinery investment decisions this article presents a multiperiod mixed integer programming mmip model of optimal machinery decisions infinite horizon valuation models of replacement and other investment situations are conceptualized in the context of a finite programming model dual properties of the mmip model are used to identify and value opportunity costs involved in investment decisions of farm machinery the interdependent nature of investment and production relationships necessary for solving these values emphasizes the importance of a holistic firm perspective in analyzing farm machinery investment strategies an empirical situation is used to demonstrate model application

investment demand when economic depreciation is stochastic the neoclassical model of investment by a risk neutral firm is generalized to include uncertainty about the rate of depreciation by replacing the deterministic capital accumulation identity with a stochastic variant ito s stochastic dynamic optimization is used to derive conditions for optimal investment a nondegenerate steady state distribution of the capital stock is shown to exist and is derived for the empirically important case of a normalized quadratic profit function and static price expectations it is demonstrated for this case that uncertainty about the rate of depreciation decreases the expected steady state capital stock and investment

a nonlinear mixed integer multiperiod firm model abstract we formulate and test an advanced multiperiod model for strategic firm planning this has not been previously considered as a mixed integer nonlinear problem minlp our approach is to show the differences between a linear and a nonlinear mixed integer approach the key property of our model is the simplicity and efficiency of generating optimal firm strategies a cornerstone for managerial acceptance our purpose is to maximize the discounted value of net income and return on investment roi our model has been tested on some major finnish firms and it seems to give reliable results with the data of our sample firm for this paper optimal roi and optimal net income presuppose different strategies when optimizing roi the model balances between cash and fixed assets while optimizing net income results in an intensive investment program even if our sample firm is but one case the results are indicative of some fundamental principles governing managerial decision making

production and investment decisions under sunk cost and temporal uncertainty building on glenn johnson s asset fixity theory this article introduces sunk cost and temporal uncertainty in jorgenson s neoclassical theory of investment under the assumption of risk neutrality we show sunk cost and temporal risk affect the implicit rental value of capital and investment and entry exit decisions results suggest there are important interactions between sunk cost and the effects of temporal uncertainty on production behavior

large firms and industrial reform in former planned economies the case of china in china s industrial reform alongside the much studied dynamism of small industries there has been a simultaneous powerful growth of large scale state industry state planning has played an important role in this process through heavy protection from international competition and support for selected enterprises which it was hoped would benefit from economies of scale and scope these enterprises have undergone gradual institutional change with growing foreign investment and slow movement towards multiplant operation this process is one in which there are emerging institutions resembling the modern business corporation albeit with specific chinese features c 1996 academic press limited copyright 1996 by oxford university press

dynamic input demand functions and resource adjustment for us agriculture state evidence abstract the paper presents an econometric model of dynamic agricultural input demand functions that include research based technical change and autoregressive disturbances and fits the model to annual data for a set of state aggregates pooled over 1950 1982 the methodological approach is one of developing a theoretical foundation for a dynamic input demand system and accepting state aggreage behavior as approximated by nonlinear adjustment costs and long term profit maximization although other studies have largely ignored autocorrelation in dynamic input demand systems the results show shorter adjustment lags with autocorrelation than without dynamic input demand own price elasticities for the six input groups are inelastic and the demand functions possess significant cross price and research effects

too many mothers in law abstract developing countries with low tax capacity may rely on predation to finance government functions government predation in turn is often accused of imposing a choking effect on state owned enterprises soes contributing to the latter s poor performance we formalize this choking effect as a problem of inefficient predation that arises from time inconsistency and show that having multiple government bodies supervising the same soe may mitigate this problem our theory provides an efficiency rationale for the chinese style of decentralization before 1978 and challenges the wisdom of china s recent enterprise reform that attempted to consolidate supervisory power

investment and disinvestment principles with nonconstant prices and varying firm size applied to beef breeding herds variable beef breeding herd sizes are found to be optimal given cyclical beef prices traditional replacement theory does not allow variable firm size because unequal investment replacement and disinvestment culling rates are not possible if firm size changes cost of production per unit endogenously changes given a u shaped cost curve optimal investment and disinvestment rules for variable firm size are developed based upon the firm s cost curve and discounted net revenue flows for a finite rolling planning horizon current and future investment and disinvestment decisions are linked by their mutual effect on firm size and hence production cost per unit

testing asset fixity for u s agriculture comment whether a farmer considers an asset fixed or variable as plans are made for managing the farm depends on current opportunity costs three opportunities are particularly relevant at the time a farm management decision is made the value of an asset in use on the farm the cost of acquiring more of the asset and the benefits of disposing of some of the asset already owned by the farmer in the event that an asset can be disposed of at the same price that it can be acquired that asset is not subject to fixity and the three costs will equal one another on an optimally organized farm consider a pair of shoes acquired on a department store charge account if after taking them home the buyer finds they pinch his feet he may return them the next day and get his money back the difference between acquisition cost and salvage value at this time is negligible it is only the inconvenience of making another trip to the store suppose he discovers that the shoes pinch as he wears them at work the next day the use value is now below the acquisition cost of another pair of shoes but the salvage value of this pair has dropped precipitously his current salvage opportunities now include giving the shoes to a relative selling them to a used clothing merchant or taking an income tax deduction by giving them to charity shoes were considered a variable asset when the buyer shopped for them he expected them to be worth more to him than he paid for them they were not subject to fixity until after he wore them but that bit of history becomes irrelevant whether the shoes are a fixed or variable asset depends on whether the buyer can salvage them for more than the value he might get by tossing them in the closet with the expectation of wearing them occasionally in the event that the current salvage value of an owned asset is below the acquisition cost of an additional and comparable one the asset is subject to fixity whether it is fixed or not in a given situation depends on a comparison among opportunity costs that apply at the time the decision is made if the opportunities for using the asset on the farm exceed the cost of acquiring more of the asset the asset is variable and the profit maximizing farmer will acquire more of it if the opportunities for selling the asset in the salvage market exceed the value in use on the farm the asset is variable and the profit maximizing farmer will dispose of some or all of it when the level of use of an asset is not worth changing the farmer considers it fixed the use value is less than or equal to the acquisition cost so expansion is not profitable and the use value equals or exceeds the salvage value so it is not profitable to sell it the three relevant costs have the following relationship on an optimally organized farm acquisition cost equals or exceeds the opportunity cost of using the asset on the farm and on farm opportunity cost equals or exceeds the salvage value these ideas are readily incorporated into economic analyses of individual farms a farm manager need not decide prior to analysis what is to be fixed and what is variable the list of fixed assets is determined endogenously as part of the farm management plan the list of fixed assets varies with the initial farm organization in place at the time the planning process begins and with opportunity costs associated with buying selling and using assets subject to fixity the difficulty with fixed asset theory is in its aggregation from firm to industry problems the uniqueness of each individual farm organization is lost in the aggregation to all farms and the off farm opportunity costs which are appropriate to individual farm situations are not included in the aggregate price series used by economists to analyze the allocation of natural resources and purchased farm inputs among alternative uses the aggregation problems and data limitations make fixed asset analysis difficult at the aggregate level despite its complete simplicity at the farm level for example farm machinery is subject to fixity during a given interval the level of machinery use may increase on some farms decrease on some and remain fixed on others the net change in the aggregate whether positive negative or zero says little about the role of the fixed asset in aggregate production some degree of disaggregation is required but these difficulties do not make the consideration of fixed assets in the supply response of u s agriculture any the less important as chambers and vasavada put it asset fixity must exist at the aggregate level p 764 inasmuch as asset fixity affects the supply functions of individual farms it requires no great leap of imagination to suppose that asset fixity affects the aggregate supply function as well the difficulty arises in trying to measure and test the statistical significance of asset fixity in the aggregate supply function to illustrate for a situation of price reversal supclark edwards is an economist with the economic research service u s department of agriculture review was coordinated by peter berck associate editor

market aspects in product life cycle inventory methodology abstract in planning a product life cycle inventory analysis the correct choice of methodology often depends on market information this paper discusses a number of points in the life cycle inventory methodology choice of product alternatives geographical system boundaries technological levels and co product allocation rules where the market aspect becomes obvious and where a disregard for these aspects may lead to serious flaws in the results

an adjustment cost rationalization of asset fixity theory this article integrates a classic concept in production economics g l johnson s asset fixity theory with the dynamic adjustment cost model until now the literature has considered these two to be incompatible by relaxing the smoothness assumption of the adjustment cost function at the origin the theory of costs of adjustment can provide a rigorous endogenization of asset fixity g l johnson and edwards results are then obtained when the linearity assumption of the adjustment cost function is imposed the work reported here also indicates that both smoothness at the origin and symmetry of adjustment cost function should be subject to empirical tests

an opportunity cost view of fixed asset theory and the overproduction trap comment in a 1981 ajae article johnson and pasour criticize the works of edwards and glenn johnson 1972 and earlier publications for attributing persistent excess production in agriculture to an asset fixity theory which at its crux relies on divergences between asset acquisition costs and asset salvage values johnson and pasour mjp pinpoint their critique of edwards and johnson ej when they state p 3 the conclusion of fixed asset theory that excess resources are trapped in production can be traced directly to selection of acquisition prices of resources as a benchmark for equilibrium production but there is no reason to expect the opportunity cost of a resource once acquired to equal its historical acquisition price in his 1982 ajae reply to mjp glenn johnson contends that the ej formulation does contrary to the mjp assertion allocate resources on the basis of opportunity costs including the cases where opportunity cost is equal to current not historical acquisition cost or ourrent not historical salvage value the primary purpose of this paper is to discuss briefly how mjp s article is lacking in a key respect it ignores intertemporal opportunity costs of durable resources to achieve brevity and expositional clarity other aspects of differences between mjp and ej are avoided insofar as the specifics of this paper allows conventional resource adjustment theory is reviewed by mjp their equations 1 4 pp 1 2 stress is placed on the usual hypothesis that the equilibrium use of durable resources similar to nondurables occurs when each durable s value of marginal product just equals its marginal factor cost this equilibrium relation is hypothesized for a profit maximization firm to hold for each durable resource or asset in each production or planning period t but this engine of analysis while acceptable for nondurable resources lacks crucial detail for dealing with the multiperiodicity of durable resources essentially it is a monoperiodic engine or at best it is a sequential monoperiodic engine it avoids defining the time horizon the finite or infinite span of t hence it avoids a precise definition of the relevant set of investment disinvestment and production activities to be considered by the decision maker more specifically even if t can be limited to a finite number of periods s intertemporal opportunity costs associated with each durable resource are ignored assumed by implication to not exist or assumed to equal zero to paraphrase perrin who mjp acknowledge as having reviewed their paper these are the costs of postponing the earnings which will be forthcoming from the series of replacement or new investment durable assets for the currently owned or currently considered asset moreover if the appropriate span of t is infinite it becomes even more important not to ignore intertemporal opportunity costs this point was illustrated conceptually by perrin in his figure 1 p 61 when considering optimal investment disinvestment in and use of durables multiperiod models which explicitly account for time money relationships are judged by most economic analysts to be preferable to conventional static monoperiodic models wealth maximization becomes the norm as opposed to one period profit maximization present value equations which model flows of acquisition prices ensuing quasi rents and salvage values of durables or their derived first order marginal optimizing inequalities take over the role of simple static vmp mfc equalities in what follows the resource adjustment rule hypothesized by mjp is compared with the marginal rules derived by perrin rules and logic which are presented in various earlier and subsequent texts and other publications on capital investment equation 3 in mjp p 2 summarizes their durable resource adjustment rule as follows

investment and disinvestment principles with nonconstant prices and varying firm size applied to beef breeding herds comment optimal investment and disinvestment principles have received considerable attention in both general and agricultural economics for over two centuries notable are the works of faustmann samuelson 1937 hirschleifer burt and perrin which establish the basic replacement principle recently trapp presented a reformulation of this basic replacement principle by relaxing the assumptions of constant prices and firm size the purpose of this comment is to discuss a possible misinterpretation of the replacement principle underlying trapp s model specifically the link between trapp s article and previous literature is established with the hope of clarifying any misunderstandings of optimal investment principles trapp states that his equations 3 and 4 which are derived from the discrete time form of the net present value formula for a single asset constitute the appropriate addition and culling investment and disinvestment decision rules for a firm with nonconstant size trapp p 694 this formulation is analogous to perrin s equation 2 which maximizes the returns from an asset over a single rotation in contrast chavas kliebenstein and crenshaw present the asset replacement decision as an optimal control problem with an infinite planning horizon transversality conditions for optimal asset rotation as given in chavas kliebenstein and crenshaw s equation 12 correspond to perrin s equation 4 2 which maximizes the returns from an asset over an infinite horizon reid and bradford in an investigation of investment and disinvestment in farm machinery also derive optimal rotation criteria analogous to perrin s formulation thus it appears that an inconsistency exists in the journal associated with the appropriate replacement rule when expansion and contraction of an operation is endogenously determined should replacement rules be derived from an infinite horizon specification or from a single asset specification the merits of an investment decision must be based not only on earnings from the next production period but also on the rents which can be extracted from the firm s fixed factors failure to consider future assets in a replacement decision implies that changes in replacement costs have absolutely no effect on the optimal life of assets up to the point where it is no longer profitable to operate specifically maximizing over a single asset rotation corresponds to maximizing the internal rate of return of an investment decision with a discount rate quivalent to the internal rate of return samuelson 1976 the quantitative effects of considering only a single asset specification are minimal depending on the length of the asset rotation and the discount rate employed as the rotation length increases or a larger discount rate is employed representation of the optimal replacement rule will converge to perrin s equation 2 samuelson 1976 the turnpike theorem states that if the asset rotation is of sufficient length where the end of the horizon has o influence on period decisions the system then converges towards the von neumann path boussard too short a length may result in the system never converging toward the von neumann path alternatively if the salvage and acquisition values are equal at any point in time then the von neumann path will be reached at the beginning of the last period however in general asset replacement is costly and thus access to the von neumann path is not instantaneous the apparent inconsistent use of a single asset specification in contrast to basic replacement principles associated with an infinite horizon may be resolved by investigating the theoretical results in chavas and klemme employing an optimal control methodology with a finite planning horizon t a distinction among rules derived from alternative specifications is evident using perrin s terminology chavas and klemme generalize the replacement criteria for a system with multiple constraints

the dynamic value of mne political embeddedness the case of the chinese automobile industry this paper examines the complex relationship between the embeddedness of multinational enterprises mnes in host country political networks and their long run competitive positions in host emerging markets we report the findings of a longitudinal study of the chinese automobile sector from the early 1980s to the mid 2000s using data from 142 interviews over 11 years and a wide range of secondary sources we explore the process through which the value of political embeddedness changed over time in the face of profound and rapid changes in host country business environments on the basis of this longitudinal study the paper unravels the underlying mechanisms that lead to the declining and even negative value of deep political embeddedness by mnes in a politically stable emerging economy

farmer behavior under risk of failure cudari c department of agricultural and resource economi division of agriculture and natural resources l university of california ut workingpaperno 488 j re v farmer behavior under risk of failure by william e foster and gordon c hausser giannini foundation of agricultural economics uerary cr california agricultural experiment station giannini foundation of agricultural economics october 1990

testing asset fixity for agriculture reply the observations made by lee and baumel lb on our previous effort appear to cast some doubt on the methodology employed to test the asset fixity hypothesis for u s agriculture as their criticism is of a fundamental nature we welcome the opportunity to address the points they raise to do so it is only proper at the outset to sort out the major charges leveled against the chambers and vasavada cv asset fixity study and analyze them in sequence the lb critique hinges on two types of objections these are a that the asset fixity hypothesis cannot be tested under constant returns to scale and b that the terms asset fixity and putty clay are not freely interchangeable as cv suppose the arguments advanced to justify these positions roughly adopt the following lines of reasoning under the cost minimization hypothesis constancy of inputoutput ratios under constant returns to scale is consistent with variation in both inputs and output hence rejection of the putty clay hypothesis does not necessarily imply rejection of asset fixity since putty clay merely requires constancy of inputoutput ratios while asset fixity requires no change in input quantities for example say labor output ratios are somehow optimally determined to be ten hours per bushel of corn then ex post price variation may keep this ratio unchanged while the actual labor and output quantities demonstrate some variation the second objection appears to take a broader view while not necessarily abandoning the constant returns to scale criticism that the asset fixity and putty clay hypotheses are not one and the same thing a graphical illustration of the behavior of a representative profit maximizing firm not a fixed output cost minimizing firm is provided to supplement this position of course since profits are unbounded under constant returns to scale lb point out that their illustration of the comparative static behavior does not adopt this assumption it would appear therefore from their arguments that not only is asset fixity untestable under constant returns to scale both under cost minimization and profit maximization but that any acceptable test procedure must invoke a distinction between the putty clay and asset fixity hypotheses our efforts to address these criticisms proceed in two stages first it is shown that the asset fixity hypothesis can be tested under the constant returns to scale assumption this lb contention is without theoretical or empirical content second the broader objection relating to distinguishing between characteristics of technology putty clay and economic responses asset fixity is discussed this discussion reveals no major inconsistency between the position taken by lb and cv their concept of asset fixity corresponds to the weaker form of asset fixity individual factor fixity tested in the original cv formulation our conclusions are noted in the final section and they justly reflect significantly greater optimism regarding the original cv study in comparison with those shared by lb

revealing hidden co2 impacts from consequential consumption by matrix analysis application to japanese single households abstract the aim of this study was to develop a novel analytical framework using matrix based analysis to visualize the environmental impacts of consumption by considering the direct and indirect consumption of all the items induced by the initial consumption called consequential consumption in the context of consequential life cycle assessment lca the significance of this framework and the importance of considering consequential consumption have been demonstrated by analyzing the net co 2 emissions due to consumption through a case study of single households in japan the analytical framework includes the following four steps 1 categorization of consumers 2 calculation of a matrix of consequential consumption 3 impact assessment and 4 uncertainty analysis the normalization process plays an essential role in the calculation of a matrix of consequential consumption while meeting the constraint of fixed income the matrix of consequential consumption was obtained by analyzing the latest japanese household expenditure data for 2004 the net co 2 emission from consumption was estimated using the matrix of consequential consumption and the co 2 intensities of products services in japan as a result we found that the consumption of some products services have the potential to increase decrease co 2 emissions beyond their own co 2 intensities because of consequential consumption in spite of their relatively small co 2 intensities several products and services meat dairy products and eggs oils fats and condiments water and sewerage charges domestic nondurable goods have high net co 2 emissions per unit price japanese yen jpy this is because of high co 2 emissions from the consequential consumption of energy in contrast the net co 2 emission from charges for board are negative because of the substitution relationship between food and energy items compared with the results of other foregoing studies on food materials the net co 2 emission by our approach is much larger than that indicated by the conventional process specific approach

is the state led industrial restructuring effective in transition china evidence from the steel sector during the reform era the chinese government has been carrying out strategic industrial policies modelled on those in post war japan and south korea in the hope of transforming its highly fragmented manufacturing sector into one that comprises a small number of internationally competitive big businesses using the evolution of the chinese steel industry structure from the late 1980s to the early 2000s as a case in point this paper finds that the chinese government s consolidation attempts have by and large not been very successful the disappointing policy outcome is interpreted by a detailed examination of the industry policy mechanism in china it is concluded that the institutional framework of the chinese state differs from its counterparts in korea and japan in some fundamental aspects among these the fragmented and uncoordinated chinese bureaucracy contributes significantly to the inefficacy of policy implementation

the development of china s solar photovoltaic industry why industrial policy failed this article studies china s central local government relations in the formation and implementation of an industry policy in china the central government is responsible for policy formation and the local governments are responsible for policy implementation where local governments are allowed ample flexibility in the ways to achieve the policy mandate this arrangement is conducive to local competition but there is no built in mechanism in the system to regulate such competition the system is defective in the execution of an industrial policy in that it fails to discipline the recipients of policy favours and to make efficient exit selections because local competition involves policy resources as well as economic resources the outcome of competition is not necessarily consistent with the comparative advantage of the region the more that policy is emphasised in industrial development the more that competition tends to favour large and rich cities after a certain period of hands off local competition the timing of which is unpredictable but will come when the industry runs into troubles the central government holds the ultimate power to determine the winners the central government typically picks the large and strong firms as the winners which are crowned as a national team and became eligible for further policy support this institutional set up produces a rapidly growing industry which often results in over capacity but not necessarily a competitive industry i use the case of china s solar photovoltaic industry to illustrate these points

optimal replacement policies for rejuvenated assets the faustmann samuelson solution for optimal asset rotation is extended to consider both asset rejuvenation and nonconstant prices a dynamic theoretical model is developed in terms of an optimal control problem with discontinuous control variables and numerical solution procedures are outlined the model is applied to layer hen replacement where hen rejuvenation by forced molting is a common industrial practice results indicate a sensitivity between the decision to rejuvenate or replace a hen and the egg price cycle suggesting a mixed rotation strategy

comparative analysis of attributional corporate greenhouse gas accounting consequential life cycle assessment and project policy level accounting a bioenergy case study abstract in order to avoid dangerous climate change greenhouse gas accounting methods are needed to inform decisions on mitigation action this paper explores the differences between attributional and consequential greenhouse gas accounting methods focusing on attributional corporate greenhouse gas inventories consequential life cycle assessment and project policy greenhouse gas accounting the case study of a 6 mw bioheat plant is used to explore the different results and information these methods provide the findings show that attributional corporate inventories may not capture the full consequences of the decision in question even with full scope 3 reporting and are therefore not sufficient for mitigation planning although consequential life cycle assessment and the project policy level method both aim to show the full consequences of the decision the project policy level method has a number of advantages including the provision of a transparent baseline scenario and the distribution of emissions removals over time the temporal distribution of emissions removals is important as the carbon debt of the bioheat plant can exceed 100 years making the intervention incompatible with 2050 reduction targets an additional contribution from the study is the use of normative decision theory to further develop the idea that the uncertainty associated with bioenergy outcomes is itself a highly decision relevant finding

consequential life cycle assessment of bioenergy systems a literature review abstract policies and business decisions intended to promote the use of bioenergy should be based on accurate estimates of the sustainability impacts of various alternatives including indirect consequences of any change consequential life cycle assessment clca attempts to include such impacts in the analysis this paper reviews studies that have adopted a clca approach to analysing the use of bioenergy describing their main topics approaches empirical and methodological aspects and scenarios the review finds that the production of studies proceeded at a modest pace from 2007 with a significant increase occurring from 2015 onward the most studied impact is global warming potential gwp although other impacts are frequently taken into consideration a majority of the studies concern the agricultural followed by the forest sector the literature has a european emphasis and relatively few studies have focused on low and middle income countries the review also finds a diversity in terms of how empirical and methodological aspects are taken into consideration based on the findings of the review areas of improvement for future research are suggested an increased focus on bioenergy use in the household sectors more studies in under researched regions more precise explanations of the clca methods used a critical examination of the scenarios and methodological collaboration with economic bio sector modelling in addition the factors that affect the generalizability of the results can be discussed in a more systematic manner frameworks and procedures for improving the applicability and validity of clca will likely emerge as the research field develops

global linkages the chinese high tech community and industrial cluster development the semiconductor industry in wuxi jingsu the development of industrial clusters in china has become a subject of international interest but attention has primarily focused on government efforts to attract fdi to promote industrial clusters and regional development the local process which supports the rise and growth of clusters driven by the domestic firms has been relatively ignored in this debate thus this article considers the analytical framework of strategic coupling and uses a case study of the wuxi semiconductor industry to investigate the cluster formation dynamics and effects driven by domestic rather than fdi firms with the mediating role of the transnational chinese technical community the state and domestic firms it concludes that the rise and growth of the semiconductor domestic led cluster in wuxi is not dependent on fdi but instead results from the dynamic interplay of several elements effects of technology spillover from the government funded research institutions as well as mutual competition and co operation in tech

testing asset fixity for u s agriculture two problems which have concerned agricultural economists since the great depression are low farm resource returns and agriculture s tendency to maintain high aggregate production in the face of declining real product prices the latter phenomenon referred to as irreversibility of supply has spawned a significant literature on approaches to estimating and testing irreversible supply curves houck tweeten and quance while there are numerous explanations of these problems it is widely accepted that both are at least partially due to some asset fixity within agriculture that is in the aggregate there are certain productive factors which are trapped in agriculture attempts to explain asset fixity are not new galbraith and black early argued that high fixed costs contribute to a lumpiness of important factors which makes their temporary reduction or reorganization so expensive as to be unprofitable in the short run later g l johnson hypothesized that productive assets are trapped in agriculture because of a divergence between acquisition costs and salvage value formal developments are in edwards hathaway and johnson and quance both explanations have been challenged d g johnson concluded that available empirical evidence did not support galbraith and black s high fixed cost hypothesis he argued instead that the data were consistent with inelastic supply of agricultural inputs johnson and pasour criticized inferring asset fixity from a divergence between acquisition costs and salvage values they argued that the appropriate concept for investigating resource allocation is that of the resource s opportunity cost although they criticized g l johnson s fixed asset theory they still concluded that asset fixity theory can contribute toward an understanding of why the supply function whether firm or industry is not reversible

processing industry capacity and the welfare effects of sugar policies normally analysis of policies affecting commodities such as sugar employs long run comparative statics under certainty and ignores processing industries like cane sugar refining under the implicit assumption that the capital is malleable in both the short and long run we present a dynamic model calibrated to world sugar and solved with numerical dynamic programming that includes the specific capital of the refining industry when compared to an otherwise identical static model the dynamic model suggests that some 20 of welfare losses may be misattributed to cane sugar producers instead of refiners in contrast the difference between certainty and uncertainty proves to be unimportant

transposing lessons between different forms of consequential greenhouse gas accounting lessons for consequential life cycle assessment project level accounting and policy level accounting abstract greenhouse gas accounting has developed in a number of semi isolated fields of practice and there appears to be considerable opportunity for transposing methodological innovations and lessons between these different fields this research paper identifies three consequential forms of greenhouse gas accounting consequential life cycle assessment project level accounting and policy level accounting these methods are described in detail and then compared in order to identify the key methodological differences and the potential lessons that can be transposed between them analysis of the substantive methodological differences suggests that consequential life cycle assessment could be enhanced by adopting the same structure used in project and policy level accounting which provides a time series of impacts aggregate level analysis and a transparent specification of the baseline and decision scenarios there is a case for conceptualising a unified form of consequential time series assessment of which project policy and product assessments would be sub types

investment in u s agriculture resource adjustment problems in u s agriculture are motivated against the background of the farm problem the adjustment cost hypothesis is invoked to specify and estimate consistently a system of dynamic investment demand and output supply equations by utilizing recent advances in dynamic duality theory the investment demand equations assume the form of a multivariate flexible accelerator results indicate that labor capital services and land exhibited quasi fixity while intermediate materials were a variable factor this can be construed as a form of asset fixity within aggregate u s agriculture the univariate flexible accelerator hypothesis is rejected

an opportunity cost view of fixed asset theory and the overproduction trap in fixed asset and exit barrier theories durable asset valuation is based upon acquisition prices yielding downwardly biased rate of return estimates and erroneous implications that excess resources become trapped in production when product price expectations fall conventional asset valuation based on opportunity cost shows that excess resource applications are incompatible with rational producer behavior market failure conclusions of overproduction trap models are shown to be unfounded a review of recently published agricultural economics texts illustrates how use of fixed asset theory in the college classroom obscures the concept of choice influencing cost and the rule of resource allocative efficiency

the political economy of chinese style privatization motives and constraints summary the paper examines how the privatization of chinese state owned enterprises soes can be successfully triggered and completed by identifying the motives of local government leaders and the constraints that face them during transition we conclude that first whether local governments are motivated to privatize their soes depends on if the ownership transfer is expected to stimulate sufficiently high growth of local tax revenues without sacrificing the bureaucrats private control benefits second a specific privatization program can succeed only if it manages to satisfy the managerial cooperation constraint the workers compensation constraint and the bank debt servicing constraint the motives cum constraints political economy approach offers an important explanation for the pace and scope of the ongoing chinese style privatization