the impact of food and economic crises on diet and nutrition the conventional view is that inelastic demand makes consumption of staple foods resilient to major price and income shocks we explore the dietary and nutritional implications of a major shock in bulgaria in the mid 1990s with data from before during and after the shock while demand for foodstuffs may remain relatively unchanging in environments characterised by stable food prices and incomes economic crises and significant price spikes appeared to induce dramatic changes in price and income demand elasticities we therefore suggest the use of caution in basing policy prescriptions on randomly available pre crisis simulations

movements towards free trade and domestic market performance with imperfect competition this paper studies the response of a dominant domestic oligopoly to the reduction in the rate of a protective tariff the issue here is whether domestic market performance is improved through a movement toward free trade alone put another way is free trade always a substitute for competition policy we find that the lower tariff may lead to inferior domestic market performance the direction of the change and its magnitude are functions of the shape of the import supply function the degree of competition between oligopolists and whether or not entry is possible thus there is reason to believe that a strong competition policy may in some markets be complementary to freer trade

cost allocation in rescheduling with machine unavailable period abstract we study a rescheduling problem faced by multiple job owners sharing a single machine where jobs need to be rescheduled when the machine becomes unavailable for a period of time the disruption caused by any new schedule is restricted such that the difference between the completion times in the initial and the new schedules of any job is no more than a given threshold a natural way to reschedule is to process the jobs in the initial sequence each as early as possible this defines a feasible schedule over which cost saving can potentially be achieved by optimal rescheduling as long as the cost saving can be fairly shared by job owners we define a cooperative game for job owners accordingly to share the cost saving given that the optimization problem is computationally intractable we find several optimal properties and develop an optimal pseudopolynomial time dynamic programming algorithm for rescheduling we provide a simple closed form core allocation of the total cost saving for all the jobs and also provide the shapley value of the game in a computable form then we computationally evaluate the extra cost caused by machine unavailability the cost saving from optimization relative to the naturally constructed schedule the likelihood for the shapley value to be a core allocation and how the shapley value allocates cost saving among job owners managerial insights are derived from the computational studies this work contributes to the literature by explicitly incorporating two classic scheduling topics sequencing game and rescheduling

profit shifting and trade agreements in imperfectly competitive markets governments have a reason to form a trade agreement when an international externality is associated with their trade policy choices when countries are large if a government raises its import tariff the world offshore price of the imported good is reduced the importing country then enjoys an improvement in its terms of trade and the exporting country suffers a negative terms of tradeexternality asjohnson 1954 argues whengovernmentsmaximizerealnational income and markets are perfectly competitive the associated noncooperative equilibrium is inefficient and governments can achieve greater welfare by forming an appropriately designed trade agreement bagwell and staiger 1999 and grossman and helpman 1995 extend the modeling framework to allow that governments have political economic preferences allowing for a wide range of possible political economic motivations bagwell and staiger 1999 show that the noncooperative equilibrium is inefficient if and only if governments are motivated by the terms of trade consequences of their trade policies building from this finding they then characterize the form that an efficiency enhancing trade agreement might take they show that the principles of reciprocity and nondiscrimination the latter embodied in the most favorednation mfn obligation play a useful role in guiding governments toward efficient policies in this article we move beyond the competitive markets paradigm and expand the analysis to markets with imperfect competition thereby introducing the realistic possibility that firms have market power a firm with market power is itself large in the sense that it does not regard the market price as fixed instead such a firm recognizes that its decisions may influence the price at which its output sells the terms of trade externality is still present in markets with imperfectcompetition butthewell known profit shifting rolefortradepoliciesinimperfectly competitive markets suggests that other international externalities might also be present for a sequence of workhorse models with imperfectly competitive markets we examine the rationale foratradeagreementandconsidertheformthatanefficiency enhancingtradeagreementmight take

economic shocks wealth and welfare the immediate effects of the asian crisis on the well being of indonesians are examined using the indonesia family life survey an on going longitudinal household survey there is tremendous diversity in the effect of the shock for some households it was devastating for others it brought new opportunities a wide array of mechanisms were adopted in response to the crisis households combined to more fully exploit benefits of scale economies in consumption labor supply increased even as real wages collapsed households reduced spending on semi durables while maintaining expenditures on foods rural households used wealth particularly gold to smooth consumption

optimum discriminatory tariffs under oligopolistic competition this paper attempts to present a simple cournot model to determine the optimal discriminatory tariff rates when the international market is a homogeneous heterogeneous product market in the model there are two foreign firms located in two different countries competing for sales in a local market when the firms sell a homogeneous product and the home country can impose differential tariffs on imports from different countries then the tariff on the low cost producer should be hgher in particular with constant marginal costs the tariff difference should equal half the cost difference on the other hand if the firms sell differentiated products with symmetric linear demands and technologies then the weaker the degree of product differentiation the greater is the tariff difference compared with the cost difference

a note on the optimal tariff retaliation and the welfare loss from tariff wars in a framework with intraindustry trade abstract this paper uses krugman s 1980 model of trade with product differentiation and monopolistic competition to examine the effects of a uniform ad valorem tariff the main results are there exists an optimal tariff even for a small economy and the optimal tariff rate is an increasing function of the size of the economy and the degree of production differentiation under reasonable parameter assumptions a tariff war between two countries of equal size in which each country retaliates by imposing its own optimal tariff causes a welfare loss equivalent to a drop in income of about 4 percent

domestic export subsidy and foreign welfare abstract in this paper we present an analysis based on imperfect competition to examine the conditions under which an export subsidy of the domestic country will not only increase its own welfare but also raise the welfare of the importing country and hence the world as a whole under these conditions it is then suggested that relaxation of gatt restrictions on export subsidies might be feasible to some extent

strategic trade and competition policies to assist distressed industries a country s unilateral incentive to use strategic trade policies typically conflicts with multilateral interests regarding such intervention i demonstrate that domestic and world interests can coincide if intervention is used to deter exit from a distressed domestic industry in particular a policy of government endorsed collusion between domestic firms can improve domestic welfare while avoiding the usual beggar thy neighbour effects associated with the use of trade policies it also may offer a more incentive compatible means of assisting distressed domestic firms since a unilateral incentive to intervene exists only where the

endogenous market structures in international trade natura facit saltum abstract almost all of the large literature on international trade with imperfect competition assumes exogenous market structures the purpose of this paper is to develop a simple model that generates alternative market structures as nash equilibria for different parameterizations of the basic model equilibrium market structure is a function of the underlying technology familiar configurations such as a duopoly competing in exports or a single multinational producing in both markets arise as special cases small tax policy changes can produce large welfare effects as the equilibrium market structure shifts implying discontinuous jumps in prices quantities and profits

neighbors networks and the development of transport systems explaining the diffusion of turnpike trusts in eighteenth century england abstract turnpike trusts were widely employed organizations that improved and maintained toll roads in eighteenth century england they were created by acts of parliament and were promoted by local landowners and merchants the first turnpike was established in 1663 but they were not widespread until 1770 this paper uses survival analysis to show that network effects and inter city competition greatly influenced the diffusion of turnpikes the results show that cities were more likely to adopt turnpikes if other turnpikes were adopted along their route to london and cities were less likely to adopt when their close competitors adopted more generally the findings illustrate the importance of interaction effects under decentralization

agricultural household models extensions applications and policy this book presents the basic model of an agricultural household that underlies most of the case studies undertaken so far the model assumes that households are price takers and is therefore recursive the decisions modeled include those affecting production and the demand for inputs and those affecting consumption and the supply of labor comparative results on selected elasticities are presented for a number of economies the empirical significance of the approach is demonstrated in a comparison of models that treat production and consumption decisions separately and those in which the decisionmaking process is recursive the book summarizes the implications of agricultural pricing policy for the welfare of farm households marketed surplus the demand for nonagricultural goods and services the rural labor market budget revenues and foreign exchange earnings in addition it is shown that the basic model can be extended in order to explore the effects of government policy on crop composition nutritional status health saving and investment and to provide a more comprehensive analysis of the effects on budget revenues and foreign exchange earnings methodological topics primarily the data requirements of the basic model and its extensions along with aggregation market interaction uncertainty and market imperfections are discussed the most important methodological issues the question of the recursive property of these models is also discussed

nutritional status during an economic crisis evidence from russia between 1996 and 1998 russia experienced a spectacular decline in economic activity which was followed by a dramatic rebound between 1998 and 2000 we use panel data to examine the impact of variation in household resources on six dimensions of nutritional status distinguishing longer run from short term fluctuations in resources nutritional status is very resilient to short term variation in household resources gross energy intake adult weight and child stature change very little as expenditure deviates from its long run average longer run resources have a substantively large positive and significant effect on energy intake diet quality adult weight and child stature the evidence indicates that individuals and households are able to weather short term fluctuations in economic resources at least in terms of maintaining body mass and energy intake increased globalisation has resulted in many less developed countries becoming more integrated into world markets this integration carries both benefits and costs for the populations of those countries an oft cited cost is elevated risk of exposure to economic fluctuations which has been manifest in several spectacular economic crises across the globe in the last few decades there is however little evidence on the extent to which individuals and families are able to mitigate deleterious effects of these economic upheavals on their well being in spite of its importance for understanding the consequences of globalisation this article provides new evidence on this issue specifically we examine the relationship between several dimensions of nutritional well being and variation in household resources during the russian economic crisis in the late 1990s the economies of the former soviet bloc have been especially volatile since the transition to market based economies which began in the early 1990s nowhere has this been more true than in russia where in the last half of 1998 real gdp collapsed by around 30 and then rapid growth brought the economy back to its pre crisis level by 2000 the time path of changes in gdp is closely mimicked by changes in the incomes and expenditures of russian households using extremely rich longitudinal household survey data from the russian longitudinal monitoring survey rlms we examine the impact of these large fluctuations in household resources on nutrient intake and on anthropometric markers of nutritional status at the individual level in so doing we address an important issue in the literature regarding the extent to which households in low income settings are able

the role of free entry in an oligopolistic heckscher ohlin model retaining the basic properties of the heckscher ohlin trade model namely free entry and exit fully integrated international commodity markets and the same number of sectors with that of factors the authors develop a two country model with cournot oligopoly in this economy factor price equalization and the standard heckscher ohlin theorem on comparative advantage hold between two countries which are identical except for size however autarkic prices are different even though the level of trade is zero under the free trade regime nevertheless free trade reduces the oligopoly price and increases welfare copyright 1995 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

imperfect competition general equilibrium and unemployment abstract we analyze whether different learning abilities of firms with respect to general equilibrium effects lead to different levels of unemployment we consider a general equilibrium model where firms in one sector compete a la cournot and a real wage rigidity leads to unemployment if firms consider only partial equilibrium effects when choosing quantities the observation of general equilibrium feedback effects will lead to repeated quantity adjustments until a steady state is reached when labor is mobile across industries unemployment in the steady state is higher than when all general equilibrium effects are incorporated at once the opposite result is true if labor is immobile

are economists traditional trade policy views still valid recent analysis of trade policies under imperfectly competitive market conditions as well as in situations where trade in high technology products is important have raised doubts whether economists should continue their traditional opposition to trade taxes and subsidies this paper evaluates the new theoretical arguments for interventionist trade policies by comparing them with the traditional arguments for and against free trade investigating the empirical evidence supporting the conditions assumed in the new models appraising the realism of the behavior assumptions of these models and the sensitivity of their conclusions to changes in these assumptions and considering the political economy implications of these conclusions the general conclusion is that there are serious practical difficulties with the interventionist arguments of the new trade theorists as they themselves recognize just as there are with such traditional arguments for trade intervention as the terms of trade case for protection however the new industrial organization approach to trade theory has already provided valuable insights into trade behavior in international markets and promises to provide many more as more realistic behavior models are developed this abstract was borrowed from another version of this item

pass through of exchange rates and tariffs in brazil u s tobacco trade this paper examines the extent to which exchange rate and tariff changes are passed through in u s import prices of unmanufactured tobacco from brazil the model used considers the possibility of market imperfections in international trade and the potential effects of strategic trade policies the results indicate that agricultural prices may not be as flexible as commonly thought furthermore exchange rate and tariff changes are not fully passed through to u s tobacco import prices which indicates that firms selling brazilian tobacco may use trade strategies to maintain or even increase their trade shares in the u s tobacco market

tariffs versus quotas with strategic investment the relative efficiency of tariffs versus quotas is analyzed in a cournot oligopoly with strategic investment introducing quota licence fees to neutralize the international distributional effect when such licence fees remove quota rents from foreign firms then for the case of constrained entry with a sufficiently large number of firms quotas frequently hold a welfare advantage since tariffs relatively aggravate the inefficiency from overinvestment in the case of free entry and exit however tariffs hold a welfare advantage since there is greater benefit of increasing returns to scale to the economy by avoidance of excessive entry of firms

oligopoly and trade what how much and for whom abstract this paper integrates the cournot oligopoly model with the ricardian comparative advantage model the ricardian trade pattern is robust and only can be reversed in extreme conditions trade volume increases substantially with increases in competition in world export industries in a symmetrical world a threshold level of competition determines whether capitalists as a group usually gain or lose from trade under all circumstances workers never lose even if a country has a comparative disadvantage in a perfectly competitive world industry but workers gain less in that country than they do in the rest of the world

is the wto passe the wto has delivered policy outcomes that are very different from those likely to emerge out of the recent wave of preferential trade agreements ptas should economists see this as an efficient institutional hand off where the wto has carried trade liberalization as far as it can manage and is now passing the baton to ptas to finish the job this paper surveys a growing economics literature on international trade agreements and argues on this basis that the wto is not passe rather and subject to some caveats this survey of research to date suggests that the wto warrants strong support while a more cautious view of ptas seems appropriate

poverty food consumption and nutrition during the transition to the market economy in eastern historically average reported levels of food intake in eastern europe have been considerably higher than in most middleincome countries according to food balance sheet data average calories proteins and fats in terms of availability per capita rose continuously over the 1961 1988 period and generally exceeded the intake requirements established by the world health organization who food and agriculture organization 1991 while it may rightly be argued that these data offer little information about the effective control over food by consumers in different income groups in the case of pre reform eastern europe full employment low income inequality and low food prices generally ensured a minimal level of food intake even for those in the bottom deciles of the income distribution while undernutrition did not generally represent a problem considerable imbalances affected the diet of most people in the region particularly in urban areas and among low income groups food intake was characterized by a high consumption of cholesterol rich products such as eggs and animal fats sugar salt bread and alcohol and a low intake of good quality meat fruit and vegetables and vegetable oils the data in table 1 clearly illustrate this situation for russia and can be taken as representative of the entire region low income families consumed less food per capita while their diet was characterized by greater intake both in relative and absolute terms of bread and fats and a lower consumption of more nutritious and healthy foods the dietary imbalances implicit in this consumption pattern caused an abnormally high incidence of nutritionally related health problems including a high prevalence of overweight people cardiovascular diseases micronutrient deficiencies and anemia in addition a fairly high prevalence of low birth weight lbw and low breastfeeding rates were common in the region inadequate breastfeeding represented a critical nutritional problem for young children as milk substitutes and baby foods were generally in short supply

trade and trade policy with imperfect competition the case of identical products and free entry abstract this paper analyses intra industry trade between economies containing an imperfectly competitive industry in which firms produce a homogeneous output production is subject to increasing returns to scale and there is free entry and exit of firms trade is shown to unambiguously increase welfare by reducing the degree of monopoly in each market and increasing firm size the effects of differences in technology and endowments on the pattern of trade and welfare are examined import tariffs are shown to raise welfare in the country employing the tariff and the welfare implications of various types of industry subsidy are examined

trade policy with increasing returns and imperfect competition contradictory results from competing assumptions abstract a number of recent papers derive different results about the effects of trade and industrial policy on imperfectly competitive industries this paper sets out a single model within which policy under different market structures can be examined we consider the four types of market structure generated by oligopoly versus free entry and segmented markets versus integrated markets we conclude that the effects of policy are greater when markets are segmented than when they are integrated and that if transport costs are small policy is more potent when the number of firms is fixed than when there is free entry

are estimates of calorie income fxelasticities too high a recalibration of the plausible range abstract the wide range of calorie income elasticities in the literature results in large part from the particular calorie and income variables used for estimation elasticities across four estimation techniques and four calorie income variable pairs for a sample of philippine farm households ranged from 0 03 to 0 59 estimates associated with calorie availability are biased upwards first because random errors in measuring food purchases are transmitted by construction both to calorie availability and total expenditures and second because the residual difference between family calorie intake and household calorie availability will often increase with income the calorie intake total expenditure variable pair gives the preferred elasticity estimate in the 0 08 0 14 range

risk sharing and public transfers we use public transfers in the form of food aid to test for the presence of risk sharing arrangements at the village level in rural ethiopia we reject perfect risk sharing but find evidence of partial risk sharing via transfers there is also evidence consistent with crowding out of informal insurance linked to food aid programmes

inadequacies of the strategic rationale of export subsidies a major attraction of strategic trade theory is that it appears to explain governments desire to subsidise exports we argue that this appearance is illusory

income shocks consumption wealth and human capital evidence from russia abstract using the russia longitudinal monitoring survey this article investigates how russian households consumption responds to income shocks and in particular how household wealth and human capital affect the households ability to smooth consumption an instrumental variable estimation method with household fixed effects is implemented after correcting for potential problems of sample attrition using the inverse probability weighting method the article finds that household consumption in russia is only partially protected from idiosyncratic shocks the analysis also provides evidence that wealthier households can better smooth their consumption furthermore changes in income have less impact on consumption when households have members with higher education levels wealth effects are more pronounced in rural areas while education effects are stronger for urban households

economic growth population theory and physiology the bearing of long term processes on the this lecture sketches a theory of the secular decline in morbidity and mortality that takes account of changes induced in physiological functioning since 1700 the synergism between technological and physiological improvements has produced a form of human evolution biological though not genetic rapid culturally transmitted and not necessarily stable which is still ongoing in both oecd and developing countries thermodynamic and physiological aspects of economic growth are defined and their impact on growth rates is assessed implications of this theory for population forecasting measurement of national income demand for leisure pension policies and demand for health care are considered excerpt

capacity allocation and scheduling in supply chains we consider a multiple product supply chain where a manufacturer receives orders from several distributors if the orders cannot all be met from available production capacity then the manufacturer allocates that capacity and a set of resubmittable orders among the distributors the distributors may share their allocated capacity among themselves before submitting revised orders finally the manufacturer schedules the revised orders to minimize its cost we consider three practical coordination issues first we estimate the benefit to the manufacturer from considering scheduling costs and constraints in making capacity and order allocation decisions second we estimate the additional profit that the distributors achieve when they share their allocated capacity third we estimate the value of coordination between the manufacturer and the distributors our work is among the first to consider all three issues simultaneously we model scheduling costs and constraints within the manufacturer s capacity allocation problem we model the distributors capacity sharing problem as a cooperative game that has properties that are unique within cooperative game theory finally we develop optimal algorithms for all the models defined by the three coordination issues our exact evaluation of decisions about the appropriate coordination level improves managers ability to make those decisions

rent shifting and rent sharing a re examination of the strategic industrial policy problem this paper reexamines the market structure problem in the strategic trade policy literature it is shown that rent sharing between the home union and the home firms raises total home industry rents regardless of whether the international duopoly is cournot or bertrand furthermore home welfare also rises with cooperation if the international industry consists of more than two firms if the industry is faced with entry and if there is domestic consumption this paper shows that rent sharing can be a robust strategic industrial policy and can be interpreted as a solution to the market structure dilemma

international equity markets and trade policy abstract this paper derives optimal trade policies for exporting and importing countries when a market is imperfectly competitive and firms are internationally owned it is shown that an increase in foreign ownership of firms lowers both the optimal export subsidy of the exporting country and the optimal import tariff of the importing country at the same rate foreign ownership also affects the distribution of world welfare between countries however it does not affect trade patterns and firm values

the quality of export products and optimal trade policy this paper demonstrates that voluntary export restraints may be socially desirable to upgrade the quality of export products when informational externalities in the recognition of quality result in suboptimal production of quality by competitive firms and the enforcement of socially desirable quality is very costly optimal trade policy calls for export restrictions these restrictions apply to both size and number of firms in the export industry export licenses combined with a specific production tax cum subsidy represent a suitable pair of instruments copyright 1987 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

the first review of european union antidumping reviews the literature on antidumping ad has documented various aspects of this protectionist tool however a peculiar feature of ad has not received much attention these measures are endogenous to the behaviour of the exporting firms which can adjust the dumping margin by changing their export price and ask the authority to amend the ad measures accordingly the objective of this paper is to fill part of this gap in the literature by analysing the ad reviews conducted by the european union for affirmative petitions initiated in 1980 2009 to this end a novel data set of all such reviews has been assembled summary statistics reveal that more than a third of all petitions concluded with the imposition of ad measures are reviewed at least once before their expiration and most reviews lead to lower ad duties although almost 20 per cent of the firms investigated through interim reviews see their duties increase there are significant differences in the outcome of the reviews depending on the party requesting them i e reviews lodged by european producers are less likely to lead to lower duties these conclusions are confirmed by the econometric analysis which also shows that chinese firms see their duties reduced significantly less than those of firms from other countries

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

human development and economic sustainability abstract this paper attempts to integrate the concern for human development in the present with that in the future in arguing for sustainable human development it appeals to the notion of ethical universalism an elementary demand for impartiality of claims applied within and between generations economic sustainability is often seen as a matter of intergenerational equity but the specification of what is to be sustained is not always straightforward the addendum explores the relationship between distributional equity sustainable development optimal growth and pure time preference

latent separability grouping goods without weak separability this paper develops a new concept of separability with overlapping groups latent separability this is shown to provide a useful empirical and theoretical framework for investigating the grouping of goods and prices it is a generalization of weak separability in which goods are allowed to enter more than one group and where the composition of groups is identified by the choice of group specific exclusive goods latent separability is shown to be equivalent to weak separability in latent rather than purchased goods and provides a relationship between separability and household production theory for the popular class of linear almost ideal and translog demand models and their generalizations we provide a method for choosing the number of homothetic separable groups a detailed method for exploring the composition of the separable groups is also presented these methods are applied to a long time series of british individual household data on the consumption of twenty two nondurable and service goods

profit shifting and trade agreements in imperfectly competitive markets profit shifting and trade agreements in imperfectly competitive markets do new rationales for trade agreements arise once imperfectly competitive markets are allowed we consider several trade models that feature imperfectly competitive markets and argue that the basic rationale for a trade agreement is in fact the same rationale that arises in perfectly competitive markets in all of the models that we consider and whether or not governments have political economic objectives the only rationale for a trade agreement is to remedy the inefficient terms of trade driven restrictions in trade volume we also show that the principles of reciprocity and nondiscrimination continue to be efficiency enhancing in these settings

tariff limit pricing relative plant scale and the eastman stykolt hypothesis this paper provides a formal basis for the widely held proposition sometimes called the eastman stykolt effect that the interaction of tariff protection and small domestic market size prevents canadian firms from achieving scale efficiency it considers a free entry cournot nash equilibrium in a homogeneous goods industry protected by tariffs the model demonstrates that the tariff limit pricing effect can arise without appeal to collusion or product differentiation moreover it is not appropriate to test for the eastman stykolt effect by simply including the interaction of market size and tariffs in a regression explaining relative plant scale

up the average cost curve inefficient entry and the new protectionism abstract a two country model is developed in which each country produces one good with increasing returns the goods being perfect or imperfect substitutes with cournot nash behavior and free entry certain restrictive trade policies have effects opposite to their favorable effect under noentry assumptions import tariffs and export subsidies lead to inefficient entry that raises rather than decreases the average production cost of and price charge by the domestic industry with negative welfare consequences we argue that these predictions of our model are closely consistent with extensive canadian data on entry exit and firms responses to trade liberalization

will developing country nutrition improve with income a case study for rural south india aggregate estimates of food expenditure are consistent with such a possibility implying income expenditure elasticities close to one however the high degree of aggregation at which such estimates are made means that the considerable increase in price per nutrient as income increases is ignored and the nutrient elasticities are therefore overstated estimates for a rural south indian sample indicate that this bias is considerable and that the true nutrient elasticities with respect to income may be close to zero

savings and nutrition at low incomes while many development theorists assume saving propensities vary among different groups there has been limited theoretical justification for this view this paper analyzes two complementary theories stressing the effect on saving of physiological consequences of poor nutrition at low incomes one influence is on the probability of survival another is on workers productivity either effect means that the average propensity to save can rise with income issues considered include annuities exogenous changes in survival and efficiency implications for the efficiency wage theory of unemployment and distinctions between wage and nonwage income implications of nutritional effects for econometric specification of saving functions are stressed

vertical foreclosure and international trade policy international differences in the cost of production of a key intermediate product can mean that a domestic firm is dependent on supplies from a foreign vertically integrated firm this paper considers the incentives for the foreign firm and foreign country to supply the domestic firm when the firms compete in a cournot or bertrand market for the final product the vertical supply decision is significantly affected by domestic supply conditions for the input and a domestic tariff on final product imports optimal policy by the exporting country may require a tax on both exports or a subsidy on both exports countries that are dependent on imports of a key intermediate product or raw material from a dominant world supplier are often concerned about the price and the availability of imports a notable current example involves the computer industry japanese suppliers with the help of the japanese government recently restricted the exports of dram semiconductors substantially raising their price these suppliers control about 80 of the market for semiconductors and the higher prices and shortage in supply have forced u s producers of computers to curtail production and increase prices vertically integrated japanese firms such as toshiba and n e c have benefitted both from increased profits in the export market for semiconductors and from the improvement in their competitive position in the market for final computers as this example indicates the price and availability of imported supplies can depend on both public and private incentives in the exporting country in this paper we first examine the private incentives for a vertically integrated firm to export an intermediate product to a higher cost rival lowering its rival s costs the exporting firm may choose vertical foreclosure thus fully cutting off supplies we then consider the public interest of the exporting country does the exporting country gain by encouraging the export of the intermediate product or alternatively might government foreclosure occur the government is in a position to affect the quantity of exports of both the input and the final product by an appropriate choice of export tax and subsidy policies

import share under international oligopoly with differentiated products japanese imports in u s manufacturing this paper seeks to identify the determinants of the japanese impor t share in the u s market from the assumptions of international oligopoly and internationally differentiated products a theoretical model is developed where import share is considered as a cournot nash equilibrium the relative position of the reaction functions is determined by the previous commitments of both domestic and foreign firms on advertising r d and tangible investment as well as by artificial and natural trade barriers using a sample of twenty four three digit import competing u s industries matched to japanese industries the empirical analysis provides evidence supporting the model s predictions that the relative strategic expenditures and market structures of both partners explain the japanese import share in u s markets copyright 1988 by mit press

welfare costs of the u s antidumping and countervailing duty laws abstract the antidumping ad and countervailing duty cvd laws in the united states have become the most pervasive form of import relief sought by domestic producers this paper estimates the collective economic effect of the hundreds of active u s ad cvd orders using a computable general equilibrium model we estimate that the collective net economic welfare cost in 1993 of these orders to be 4 billion this welfare estimate is sensitive to various modeling assumptions which are explored in the paper with the implementation of the uruguay round agreements the ad cvd laws remain one of the costliest programs restraining u s trade

an empirical assessment of the welfare effects of reciprocal dumping abstract can two way trade in similar products lead to lower welfare than if such trade was banned theory answers yes to empirically investigate this proposition we examine swedish imports of bottled water assuming one shot bertrand and cournot competition we can use the estimates from a structural model of demand to uncover marginal costs we simulate the effect on consumer and producer surplus of banning imports we do not find convincing evidence that banning imports would increase overall welfare given our choice of market this suggests we should not be overly concerned with the welfare effects of two way trade in consumer goods that are close to homogenous

household composition labor markets and labor demand testing for separation in agricultural household models this paper tests the separation of farm labor supply and labor demand decisions using the observation that household composition is an important determinant of farm labor use with nonseparation after assessing the conditions under which the test has power against several alternatives an empirical model is developed to test the proposition that farm employment is independent of family composition the model is estimated on a data set from rural java the null hypothesis that farm labor allocation decisions are independent of household structure is not rejected the results are robust to different specifications of the labor demand function copyright 1992 by the econometric society

the economics of trade agreements in the linear cournot delocation model abstract existing theories of trade agreements suggest that gatt wto efforts to reign in export subsidies represent an inefficient victory for exporting governments that comes at the expense of importing governments building on the cournot delocation model first introduced by venables 1985 we derive new results from this model and use these results to develop a more benign interpretation of efforts to restrain export subsidies in trade agreements and we suggest that the gradual tightening of restraints on export subsidies that has occurred in the gatt wto may be interpreted as deriving naturally from the gradual reduction in import barriers that member countries have negotiated together with existing theories the cournot delocation model may help to provide a more nuanced and complete understanding of the treatment of export subsidies in trade agreements

climate change policy market structure and carbon leakage abstract the 1997 kyoto protocol on climate change obliges the industrialized countries to initiate the international effort of abating anthropogenic greenhouse gas ghg emissions if such an initiative is to be taken the associated competitive effects may lead to significant relocation of developed countries energy intensive production this paper examines this issue i adopt an oligopolistic structure combined with increasing returns to scale production technologies to represent the strategic interaction among the firms producing energy intensive products this representation is then embedded within a multi regional computable general equilibrium model which in turn is used for quantifying these relocational effects the results suggest that significant relocation of energy intensive industries away from the oecd may occur depending on the type of market structure with leakage rates as high as 130 in which case ghg control policies in the industrialized countries actually lead to higher global emissions

capital accumulation and the current account in a two country model abstract this paper examines the joint determination of international debt and capital accumulation in a two country model national rates of time preference are endogenous adjusting along an optimal path to come into equality with one another in the steady state the characteristics of short run current account dynamics are crucially linked to world capital accumulation and to a country s long run net external asset position steady state creditor countries tend to have current account surpluses during episodes of world output growth and vice versa for debtor countries this gives rise to possible non monotonic adjustment in the current account and consumption

anti dumping and countervailing duties under oligopoly abstract this paper constructs a conjectural variations model of international oligopoly in which the home country s optimal policy responses to the foreign government s subsidies and foreign firms dumping can be calculated some theoretical support is found for tariffs that countervail part of the foreign export subsidy the optimal fraction depends on the size of own and cross effects in demand and on the extent of market competition however no normative case is found for anti dumping duties

nutrient elasticities in a complete food demand system this study explores the linkage of the determinants of food choice with consumer nutrient availability by developing a procedure to measure changes in nutrient availability as the demand for food items change it uses demand elasticities from traditional demand analysis to estimate elasticities of changes in the nutritional content of consumer diets the procedure is applied to estimate nutrient elasticities for fifteen nutrients in response to changes in thirty five food prices and per capita income

endogenous market structures and strategic trade policy we characterize the optimal export promoting policies for international markets whose structure is endogenous contrary to the ambiguous results of strategic trade policy for markets with a fixed number of firms it is always optimal to subsidize exports as long as entry is endogenous under both competition in quantities and in prices with homogenous goods the optimal export subsidy is a fraction 1 of the price where is the elasticity of demand the exact opposite of the optimal export tax in the neoclassical trade theory a similar argument can be applied to show the general optimality of r d subsidies and of competitive devaluations to promote exports in foreign markets where entry is endogenous

using weather variability to estimate the response of savings to transitory income in thailand this paper measures the extent to which farmers are able to use savings and dissavings to smooth consumption in response to unexpected shocks to income time series information on regional rainfall is used to construct estimates of transitory income due to rainfall shocks the relationship between these measures of transitory income and savings indicates that farm households save a significantly higher fraction of transitory income than nontransitory income jel d91 016 the incomes of farm households in developing countries are notorious for being both low and uncertain policies that increase the incomes of farmers may well be different

nontariff trade controls and leader follower relations in international competition a simple duopoly model is constructed in which leader follower relations arise as part of a subgame perfect equilibrium in a game of endogenous timing the author shows that in the absence of policy intervention cost asymmetries between firms can help sustain collusive hierarchical organization of markets on the basis of this model he then analyzes the effects of voluntary export restraints and import quotas in the presence of foreign and international duopolies the author s analysis reveals that in contrast to the existing literature these nontariff trade controls can break the stability of leader follower relations and thereby raise an importing country s welfare copyright 1996 by the london school of economics and political science

trade flows in a spatial oligopoly gravity fits well but what does it explain large distance and border effects on trade flows in some industries may result from the collusive division of geographic markets in the brazilian cement industry traditional gravity equations fit the data well yet limited regional flows are due to firms strategic behaviour thanks to a unique institutional setting and an unusually rich data set i directly control for trade costs which despite their importance cannot account for the observed segmentation of local markets at current prices the paper highlights how collusive behaviour can magnify the effects of distance as firms use geography to coordinate on higher prices and less cross hauling les effets de grande distance et de frontieres sur les flux de commerce dans certaines industries peuvent etre le resultat d une division collusive des marches geographiques dans l industrie bresilienne du ciment les equations de gravite s ajustent bien aux donnees mais les flux regionaux limites entre regions sont attribuables au comportement strategique des firmes gr ce a un contexte institutionnel unique et a une base de donnees inhabituelles l auteur a pu prendre en compte directement les couts du commerce qui malgre leur importance ne peuvent pas expliquer la segmentation observee des marches locaux aux prix courants le memoire met en lumiere comment le comportement de collusion peut magnifier les effets de distance a proportion que les firmes utilisent la geographie pour assurer une coordination fondee sur des prix plus eleves et moins de transport transfrontalier

a simple test of consumption insurance are consumers effectively insured against idiosyncratic shocks to income or wealth either by formal institutions such as charities private insurance and government programs or by informal mechanisms such as gifts and loans from relatives friends and neighbors under full insurance consumption growth should be cross sectionally independent of idiosyncratic variables that are exogenous to consumers this proposition is tested by cross sectional regressions of consumption growth on a variety of exogenous variables full insurance is rejected for long illness and involuntary job loss but not for spells of unemployment loss of work due to strike and an involuntary move

nash equilibrium tariffs for the united states and canada the roles of country size scale economies and capital mobility a theoretical analysis of optimal nash equilibrium tariff rates is presented a numerical general equilibrium model is then used to find nash equilibrium tariff rates for the united states and canada the nash equilibrium tariffs are small relative to partial equilibrium estimates 18 percent for the united states and 6 percent for canada the united states is essentially indifferent between the nash equilibrium and free trade while canada is better off at the latter by 4 billion empirical results support theoretical predictions that the optimal tariff is smaller when the country is smaller there are scale economies and free entry and capital is internationally mobile

voluntary export restraints and strategic technology transfers abstract this paper investigates the effects of voluntary export restraints vers in the presence of potential entrants and technology transfers it builds a model of a licensing game in a cournot oligopoly market and examines conditions under which vers induce restrained foreign firms to transfer technologies to potential suppliers i show that a ver can decrease the profit and output of the domestic incumbent by perturbing the no licensing equilibrium reached under free trade and inducing the market to move to a licensing equilibrium

a characterization of the shapley value in queueing problems a set of agents stand to receive a service no two agents can be served simultaneously a queue has been organized and agents having to wait should receive monetary compensations we characterize the rule assigning positions in the queue and compensations corresponding to the payoffs recommended by the shapley value of the associated cooperative game

trade liberalization in a multinational dominated industry abstract existing theoretical models in the trade industrial organization literature assume almost exclusively that firms are national enterprises so that there is no international coordination by multinational firms we develop a model in which multinationals compete among themselves but coordinate production pricing and sales decisions across multiple plants and markets free entry and exit is assumed and cases in which the multinationals can and cannot segment markets are considered the model is simulated using data from the north american auto industry results are compared with a counter factual model calibrated to the same data which assumes national ownership of firms

international competition downsizing and wage inequality a country with cournot competition and free entry experiences an increase of its market size either due to economic growth or international integration of its goods markets this implied increase in competition leads to shrinking mark ups and forces firms to reduce overhead costs relative to output this implies a reallocation at the aggregate level from administrative to productive activities relative factor rewards change and wage inequality increases the factor which loses in relative terms can even lose in real terms from a quantitative perspective international competition is demonstrated to be the more plausible cause of rising wage inequality c 2007 published by elsevier b v

price unit value and quality demanded abstract given the paucity of quality price data it is common to rely on unit value average expenditure per unit as a proxy for price but this is an imperfect proxy if households respond to price increases by substituting to lower quality goods this paper draws on survey data that contain both unit value and price to estimate the severity of quality substitution in indonesia finding that it is prevalent the paper next calculates price elasticities that correct for quality substitution evaluating and ultimately rejecting a commonly used method for calculating price elasticities using only unit value data finally it demonstrates that quality substitution can result in biased price elasticities even when price is perfectly observed

the markup and inflation evidence in oecd countries in this paper we evaluate the dynamic inconsistency argument put forth by kydland and prescott 1977 and barro and gordon 1983 as an explanation for differences in the average inflation experience across oecd countries the focus is on the empirical evidence relating the overall degree of competition among firms as measured by the markup of price over marginal cost and inflation over the 1973 88 period the prediction is that higher markups raise the monetary authority s incentive to increase output leading to higher equilibrium rates of inflation we find that the markup does well in explaining cross country differences in average inflation jel classification e31 e58 d43 l ecart du prix par rapport au cout marginal et l inflation resultats pour les pays de l ocde ce memoire examine l argument mis de l avant par kydland et prescott 1977 et barro et gordon 1983 pour expliquer les differences dans le taux moyen d inflation entre les pays de l ocde on porte une attention speciale aux resultats empiriques qui relient le degre general de concurrence entre les entreprises mesure par l ecart du prix par rapport au cout marginal et le niveau d inflation entre 1973 et 1988 la prediction est que des ecarts prix cout marginal plus eleves augmentent l incitation des autorites monetaires a accroitre le niveau de production ce qui entraine des taux d inflation d equilibre plus eleves il s avere que l ecart du prix par rapport au cout marginal tend a expliquer bien les differences dans le niveau moyen d inflation entre pays

tax competition in imperfectly competitive markets abstract the literature on strategic trade policy has shown that in imperfectly competitive markets governments have an incentive to subsidize exports of their own firms yet the consequence of the departure from laissez faire is a wasteful subsidy race in contrast this paper shows that even in imperfectly competitive markets there is a strong tendency for laissez faire to prevail the driving force is the firms willingness to exploit tax or subsidy differentials by relocating production a small tax differential induces firms to change their place of production the change in market structure has a negligible effect on the oligopoly equilibrium but a non negligible impact on government revenues when tax policy is non discriminatory governments gain lose by attracting all firms when production is taxed subsidized hence laissez faire is the only equilibrium since from the point of view of the two producing countries laissez faire nondiscrimination pareto dominates the intervention equilibrium discrimination nondiscrimination is a simple device to result in a mutual beneficial outcome

international r d rivalry and industrial strategy this paper presents a theory of government intervention which provides an explanation for industrial strategy policies such as r d or export subsidies in imperfectly competitive international markets domestic net welfare is improved by the capture of a greater share of the output of rent earning industries although the subsidy ridden noncooperative international equilibrium is jointly suboptimal behaviour of governments and firms is modelled as a three stage subgame perfect nash equilibrium the assumption that the government is the first player in this game allows it to influence equilibrium outcomes by altering the set of credible actions open to firms

entry and entry deterrence in penetrable markets this paper presents a game theoretic model of entry a potential entrant into a given market is postulated to be a currently produci ng firm whose product is a substitute on the production side for the good being sold in the market an entrant is capable of switching pr oduction between markets faster than firms in general can adjust thei r total outputs to some extent a market faced with entry as such wi ll resemble a contestable market and limit pricing behavior will occ ur copyright 1988 by the london school of economics and political science

fiscal policies and the integrated world stock market abstract the paper develops a two country stochastic model of an integrated world stock market in order to address issues concerning the effects of tax and spending policies on savings asset portfolios and stock market valuations general conditions for government finance neutrality under uncertainty are derived and the characteristics of the international transmission of uncertain future spending policies are spelled out they are shown to depend precisely on a transfer problem criterion involving the government and the private sector propensities to spend in different states of nature and on the cross country correlations between shocks to productivity and public spending

effects of the customs union with the european union on the market structure and pricing behaviour of the turkish manufacturing industry turkey established a customs union with the european union in 1996 this study aims to analyse the effect of that customs union on the market structure and the pricing behaviour of the turkish manufacturing industry for the period 1994 to 2000 to that end the price cost mark up equation of 12 manufacturing industry sectors is estimated using the import and export ratios with european union countries together with control variables a second equation is also estimated for the concentration ratio index taking the trade ratios with european union countries as explanatory variables the estimation method is panel data covering eight years and 12 cross section units estimation outcomes indicate that the export and import ratios of trade with european union countries have a negative relation with the price cost mark up in the manufacturing sector it is concluded that increased imports with union countries have created a positive wealth and efficiency effect upon the turkish manufacturing industry due to f