competition and microfinance abstract competition between microfinance institutions mfis in developing countries has increased dramatically in the last decade we model the behavior of non profit lenders and show that their non standard client maximizing objectives cause them to cross subsidize within their pool of borrowers thus when competition eliminates rents on profitable borrowers it is likely to yield a new equilibrium in which poor borrowers are worse off as competition exacerbates asymmetric information problems over borrower indebtedness the most impatient borrowers begin to obtain multiple loans creating a negative externality that leads to less favorable equilibrium loan contracts for all borrowers

climate agreements in a mitigation adaptation game abstract we analyze the strategic interaction between mitigation public good and adaptation private good strategies in a climate agreement we show the fear that adaptation will reduce the incentives to mitigate carbon emissions may be unwarranted adaptation can lead to larger self enforcing agreements associated with higher global mitigation levels and welfare if it causes mitigation levels between different countries to be no longer strategic substitutes but complements we argue that our results extend to many public goods the well known problem of easy riding may turn into easy matching if the marginal utility of public good consumption is strongly influenced by private consumption

group lending repayment incentives and social collateral abstract in this paper we investigate the impact on repayment rates of lending to groups which are made jointly liable for repayment this type of scheme especially in the guise of the grameen bank in bangladesh has received increasing attention we set up and analyze the repayment game which group lending gives rise to our analysis suggests that such schemes have both positive and negative effects on repayment rates the positive effect is that successful group members may have an incentive to repay the loans of group members whose projects have yielded insufficient return to make repayment worthwhile the negative effect arises when the whole group defaults even when some members would have repaid under individual lending we also show how group lending may harness social collateral which serves to mitigate its negative effect

the supply and demand side impacts of credit market information abstract we utilize a unique pair of experiments to isolate the ways in which reductions in asymmetric information alter credit market outcomes a guatemalan microfinance lender gradually started using a credit bureau across its branches without letting borrowers know about it one year later we ran a large randomized credit information course that described the existence and workings of the bureau to the clients of this lender this pairing of natural and randomized experiments allows us to separately identify how new information enters on the supply and the demand sides of the market our results indicate that the credit bureau generated large efficiency gains for the lender and that these gains were augmented when borrowers understood the rules of the game the credit bureau rewarded good borrowers but penalized weaker ones increasing economic differentiation

the organisation of innovation collaboration cooperation and multifunctional groups in uk and german manufacturing marked differences exist between the institutional and social context for innovation in the uk and germany the question addressed here is how these different contexts affect the objectives and organisation of innovation in uk and german manufacturing in particular the paper examines the extent to which uk and german plants engage in inter plant collaboration and cooperation and multifunctional working as part of their innovative activity and explores the reasons for differences in these patterns of involvement the investigation is based on a large scale comparative survey of manufacturing plants in the two countries in germany institutional and social norms are found to encourage collaborative inter plant innovation but aspects of the german skills training and industrial relations systems make the adoption of more flexible internal systems more difficult in the uk by contrast the more adversarial nature of inter firm relations makes it more difficult to establish external collaborations based on mutual trust but less restrictive labour market structures make it easier for uk plants to adopt multifunctional working this is linked to differences in attitudes to the property rights and transaction cost problems inherent in innovation

adjustment costs from environmental change abstract the paper is concerned with the case whereby the distribution of a firm s productivity shocks changes without the knowledge of the firm over time the firm learns about the nature and extent of the change in the distribution of the shock and adjusts incurring adjustment costs in the process the long run loss in profits due to the shift in the distribution we term the equilibrium response the transitory loss in profits incurred while the firm is learning about the distribution shift is termed the adjustment cost the theory is then applied to the problem of measuring adjustment costs in the face of imperfectly observed climate change in agriculture the empirical part of the paper involves estimating a restricted profit function for agricultural land in a five state region of the midwest us as a function of prices land characteristics actual weather realizations and expected weather we then simulate the effect of an unobserved climate shock where learning about the climate shock is by observing the weather and updating prior knowledge using bayes rule we find adjustment costs to climate change are 1 4 of annual land rents

labour market deregulation flexibility and innovation labour flexibility is often portrayed as important to competitive success using evidence from an original survey of uk firms this paper investigates the relationships between firms use of on the one hand various flexible work practices human resource management techniques and industrial relations systems and on the other hand the innovative activities of those firms our results suggest that the sort of low road labour flexibility practices encouraged by labour market deregulation short term and temporary contracts a lack of employer commitment to job security low levels of training and so on are negatively correlated with innovation

the impact of adaptation on the stability of international environmental agreements we examine the stability of international environmental agreements that include clauses pertaining to both adaptation and mitigation measures we assume that adaptation requires a prior irreversible investment and presents the characteristics of a private good by reducing a country s vulnerability to the impact of pollution while mitigation policies produce a public good by reducing the total amount of pollution using a stylized model we show that adaptive measures can be used strategically and that their inclusion in environmental agreements enhances agreement stability and can even lead to full cooperation we examine the robustness of agreements including both adaptation and mitigation measures against renegotiation finally we evaluate how including adaptive measures for climate change in international environmental agreements affects welfare and overall pollution

weathering climate change some simple rules to guide adaptation decisions this paper discusses some of the elements that may characterise an efficient strategy to adapt to a changing climate such a strategy will have to reflect the long time horizon of and the prevailing uncertainties about climate change an intuitively appealing approach therefore seems to be to enhance the flexibility and resilience of systems to react to and cope with climate shocks and extremes as well as to improve information in addition in the case of quasi irreversible investments with a long lifetime e g infrastructure investments development of coastal zones precautionary adjustments may be called for to increase the robustness of structures or to increase the rate of depreciation to allow for earlier replacement many of these measures may already have to be considered now and could be worthwhile in their own right independent of climate change considerations

labor flexibility and innovation in new ventures the study investigates how labor flexibility affects innovation in new ventures more specifically drawing upon a sample of 143 greek ventures less than 8 years old it examines empirically the individual and interactive effects of functional and numerical flexibility on product innovation it also considers how these effects are moderated by the entrepreneur s political skill results suggest that functional flexibility has a positive direct effect on incremental innovation whereas numerical flexibility has a positive direct effect on radical innovation the interactions between numerical and functional flexibility affect both types of innovation the results also suggest that the labor flexibility innovation relationship is positively moderated by the entrepreneur s political skill these findings point toward aspects of knowledge related with flexible labor engagement and entrepreneurial relational capital that affect innovation

the founder s self assessed competence and venture performance abstract a large body of recent research seeks to understand organizational founding and the performance of emerging businesses although much of this research has focused on the characteristics of the business founder there is only mixed support for relationships between founders characteristics and venture performance begley and boyd 1987 gartner 1988 low and macmillan 1988 sexton and bowman 1984 this study is based on research that identifies the entrepreneurial managerial and technical functional functions as three roles that founders must competently enact in order to be successful hofer and sandberg 1987 mintzberg and waters 1982 pavett and lau 1983 schein 1987 effective performance in the entrepreneurial role requires the founder to have the ability to recognize business opportunities and the drive to see firm creation through to fruition hofer and sandberg 1987 timmons et al 1987 effective execution of the managerial role requires conceptual interpersonal and political competence pavett and lau 1983 to be competent in the technical functional role founders must be able to use the tools or procedures required in their specialized field pavett and lau 1983 to measure the competencies necessary for effectiveness in the entrepreneurial managerial and technical functional roles we developed a questionnaire to allow founders to provide self evaluations of their competencies the results provide strong evidence for the reliability of measurement and the validity of the constructs the relationships revealed in this study suggest some preliminary recommendations for potential entrepreneurs career counselors and educators the number of businesses previously initiated and the years spent as an owner manager do not appear to be strongly related to the performance of the venture however the most successful entrepreneurs are strongly convinced of their ability to recognize business opportunity they believe that they have the drive to see the venture through to fruition and report that they subjugate outside interests to the demands of their businesses thus although self assessed proficiency in the entrepreneurial function does not appear to be contingent on the length of previous experience as a founder it does appear to be a necessary component in the development of high performance companies founders of the most successful firms also gave themselves high ratings on the abilities associated with effective performance in the managerial role they had high self evaluation scores on the items measuring organizational and interpersonal skills competence in the managerial role appears to be enhanced by business education and the years of general managerial experience the founders of highly successful firms also evaluated their technical skills highly they believed they were experts in their fields and could use the specialized tools and procedures to produce high quality products and services thus the results indicate that the most successful founders those whose firms show higher levels of growth and earnings rate themselves as competent in the entrepreneurial managerial and technical functional roles they see themselves as competent generalists and in a result that is most gratifying for those in higher education it appears that a business education and experience in general managerial positions lays the ground work for a successful entrepreneurial career

sharing default information as a borrower discipline device abstract creditors often share information about their customers credit records besides helping them to spot bad risks this acts as a disciplinary device if creditors are known to inform one another of defaults borrowers must consider that default on one lender would disrupt their credit rating with all the other lenders this increases their incentive to perform however sharing more detailed information can reduce this disciplinary effect borrowers incentives to perform may be greater when lenders only disclose past defaults than when they share all their information in some instances by fine tuning the type and accuracy of the information shared lenders can raise borrowers incentives to their first best level

looking for a guide to protect the environment the development of the precautionary principle abstract if the precautionary principle is to become the guide of the international community for environmental protection policies an economic interpretation of the principle is in order the analysis of case studies and a survey of the recent decision theoretic literature show the lack of a fully satisfactory economic model more generally various theoretical and empirical results show that the principle cannot be assumed to apply a priori though it has been proposed by international treaties as a rule of thumb for situations of scientific uncertainty the precautionary principle could actually be inefficient

fundamental irreversibilities in stock externalities abstract this paper concerns the irreversibility effect in stock externalities in an environment of uncertainty with learning taking place one may wish to under emit today to avoid potential environmental irreversibilities alternatively one may wish to under invest in pollution control capital avoiding investments in sunk capital that turn out to be wasted the paper develops theoretical results on the tension between these two effects and separates risk aversion from the irreversibility effect the paper also presents a simple example in climate change policy

the effect of social capital on group loan repayment evidence from field experiments an important question to microfinance is the relevance of existing social capital in target communities to the performance of group lending this research presents evidence from field experiments in south africa and armenia in which subjects participate in trust and microfinance games we present evidence that personal trust between group members and social homogeneity are more important to group loan repayment than general societal trust or acquaintanceship between members we also find some evidence of reciprocity those who have been helped by other group members in the past are more likely to contribute in the future during the past decade exploring the role that social capital plays in economic behaviour has emerged as one of the most fascinating and fertile areas of economic research although precise definitions of social capital are notoriously difficult to pin down one of the early pioneers of the concept coleman 1988 defines social capital as social structure that facilitates certain actions of actors within the structure in his definition coleman specifically highlights the roles of mutual obligation expectations and trustworthiness social norms social sanctions and the transmission of information important studies in both developed and developing countries have analysed the impact of social capital in economic relationships putnam s celebrated work making democracy work civic traditions in modern italy 1993 and bowling alone america s declining social capital 1995 brought attention to the role that social capital plays in the development of the modern state udry s ground breaking 1994 work in nigeria illustrated how the social capital existing in traditional societies may allow for more efficient credit contracts than in developed economies with weaker social

reputation in a public goods game taking the design of credit bureaus to the lab abstract we present the results of a new laboratory experiment designed to mimic the ways in which credit bureaus will alter microfinance markets where loans are taken in groups bureaus can build reputations for borrowers at the group or the individual level and the optimal contract is not obvious in a modified public goods game with ejection and re assignment played by guatemalan micro entrepreneurs we find the use of group reputation to be effective in increasing contributions given the costs of transitioning microfinance bureaus to the sharing of individual information our results suggest that this change would not be cost effective

a cost benefit analysis of slowing climate change there are many conflicting views regarding the true dimensions of the climate change problem often these viewpoints are based on different estimates of key parameters with little indication as to why parameter estimates vary so much and which ones might be the more reliable the prospects for a co ordinated strategy to tackle climate change appear dim little consensus has emerged for example regarding the costs of abating carbon emissions some take the view that considerable improvements in energy efficiency are available at negative cost by setting minimum efficiency standards for vehicles and domestic appliances e g mills et al 1991 others regard the macroeconomic costs of even small reductions in carbon emissions as substantial manne and richels 1993 in the judgement of other researchers a proportion of carbon emissions arise purely as a result of institutional failings either at a regional level in the subsidies paid to fossil fuel energy producers in the erroneous belief that this promotes economic growth shah and larsen 1994 in failure to deal with air pollution glomsrod et al 1992 and vehicle congestion in urban areas hughes 1994 or at a global level in failing to make appropriate transfers to those countries whose forests contain rich biodiversity which we would wish to preserve pearce 1991

modes of labor flexibility at firm level are there any implications for performance and innovation evidence for the swiss economy the aim of this study is to define and measure numerical and functional labor flexibility at the firm level and investigate empirically the impact of each of these flexibility modes on performance and innovation measures as well as the interrelationship between them our estimation equation contains besides the classical production factors labor and physical capital information and communication technologies ict capital human capital variables for flexible organizational practices as well as measures for numerical labor flexibility the empirical investigation is based on data for about 1400 swiss firms copyright 2005 oxford university press

the political economy of mitigation and adaptation abstract climate policies have very uneven effects in terms of their fiscal impact while mitigation of climate change typically raises revenues adaptation is costly to the taxpayer and the more so the more distortionary the tax system moreover the benefits and costs of mitigation and adaptation vary across generations in an olg model with majority voting we show that even in the absence of international pollution spillovers and strategic considerations neither mitigation nor adaptation can be expected to be set efficiently the reason is that voters have incentives to use climate policy as an instrument for redistribution we find that these incentives depend on the underlying tax system furthermore the chosen mitigation or adaptation level may be inefficiently high in a political equilibrium with a distortionary income tax system although not simultaneously this finding suggests that a distortionary income tax system favors one policy mitigation or adaptation at the expense of the other the calibration of our model to the german economy reveals that both mitigation and adaptation are lower than their socially optimal levels

climate change mitigation and adaptation with uncertainty and learning one of the major issues in climate change policy is how to deal with the considerable uncertainty that surrounds many of the elements some of these uncertainties will be resolved through the process of further research this process of learning raises a crucial timing question should society delay taking action in anticipation of obtaining better information or should it accelerate action because we might learn that climate change is much more serious than expected much of the analysis to date has focussed on the case where the actions available to society are just the mitigation of emissions and where there is little or no role for learning we extend the analysis to allow for both mitigation and adaptation we show that including adaptation weakens the effect of the irreversibility constraint and so for this model makes it more likely that the prospect of future learning should lead to less action now to deal with climate change we review the empirical literature on climate change policy with uncertainty learning and irreversibility and show that to date the effects on current policy are rather small though this may reflect the particular choice of models employed

adapting to climate change equilibrium welfare implications for large and small economies we show that the availability of adaptation can be welfare reducing in the non cooperative equilibrium in a setting with multiple countries adaptation is a private good while abatement is a public good this means that substitution out of abatement and into adaptation by any one country imposes a negative externality on all other countries the potentially deleterious impact of adaptation is asymmetric small economies are most likely to be hurt by the availability of adaptation because they control a small fraction of global emissions relative to the biggest emitters

innovation and entrepreneurship schumpeter revisited in a large part of the literature on schumpeter one finds that attention is paid to either his early contributions with reference to the role of the entrepreneur as the personification of innovation or to his later contributions stressing the role of large companies as main drivers of innovation this paper complements some recent contributions to the assessment of the influence of schumpeter on economics and social sciences in general it demonstrates that a careful reading of his writings reveals that there is no simple dichotomy between the old and the young entrepreneurial activities play an active role in understanding the dynamics of innovation throughout schumpeter s theory copyright 1996 by oxford university press

credit information systems in less developed countries a test with microfinance in guatemala abstract increases in formal sector lending among the poor have created a need for credit information systems that provide potential lenders with borrower information in this article we present fixed effects estimations that attempt to measure the effect of a newly implemented credit information system in guatemala our results indicate that improved screening effects from the system caused the level of portfolio arrears to decline approximately 2 percentage points after it was implemented in branch offices we observe an even more substantial and significant effect of the information system in reducing late payments that occur during the loan cycle

development aid and climate finance this paper discusses the implications of climate change for official transfers from rich countries the north to poor countries the south when the motivation for transfers is ethical rather than strategic traditional development transfers to increase income and reduce poverty are complemented by new financial flows to reduce greenhouse gas emissions mitigation transfers and become climate resilient adaptation transfers we find that in the absence of barriers to adaptation mitigation or development climate change will make isolated transfers less efficient a large part of their intended effect to increase income reduce emissions or boost climate resilience dissipates as the south reallocates its own resources to achieve the mitigation adaptation and consumption balance it prefers only in the case of least developed countries which are unable to adapt fully due to income constraints will adaptation support lead to more climate resilience in all other cases if the north wishes to change the balance between mitigation adaptation and consumption it should structure its transfers as matching grants which are tied to the south s own level of funding alternatively the north could provide an integrated climate compatible development package that recognizes the combined climate and development requirements of the south if the aim is to increase both mitigation and adaptation in the south development assistance that increases the income level can be an effective measure but only if there is an international agreement and the recipient country is not income constrained if the recipient country is very poor development aid may reduce adaptation effort

learning and stock effects in environmental regulation the case of greenhouse gas emissions abstract this paper concerns the optimal regulation of greenhouse gases that lead to global climate change in particular we focus on uncertainty and learning which over time resolves uncertainty we present an empirical stochastic model of climate economy interactions and present results on the tension between postponing control until more is known vs acting now before irreversible climate change takes place uncertainty in our model is in the damage caused by global warming the results suggest that a temporary carbon tax may dominate a permanent one because a temporary tax may induce increased flexibility

credit reporting relationship banking and loan repayment how does information sharing between lenders affect borrowers repayment behavior we show in a laboratory credit market that information sharing increases repayment rates as borrowers anticipate that a good credit record improves their access to credit this incentive effect of information sharing is substantial when repayment is not third party enforceable and lending is dominated by one shot transactions if however repeat interaction between borrowers and lenders is feasible the incentive effect of credit reporting is negligible as bilateral banking relationships discipline borrowers information sharing nevertheless affects market outcome by weakening lenders ability to extract rents from relationships copyright 2007 the ohio state university

content and performance of growth seeking strategies a comparison of small firms in high and low technology industries abstract the question of how to grow and gain market share is repeatedly asked by small firm managers yet little help exists in the academic literature in terms of identification of specific business practices and competitive tactics associated with the pursuit of market share growth rather most discussion of appropriate strategies for small firm growth centers around the prescription of broad strategy types e g the often recommended niche strat egy furthermore the environment s potential effects on the viability of growth strategies seldom receive adequate treatment in the small firm strategy literature despite the long acknowledged influence of environmental conditions on strategy content this paper describes a study of the business strategies used by small growth seeking firms in high and low technology industries the construct of strategy was examined from both a micro level focusing on individual strategy dimensions and a macro level focusing on the firms overall strategic postures and patterns of strategy related variables data were collected from the senior executives of 57 small manufacturing firms whose mission strategies were to aggressively increase sales and market share the data indicate that growth seeking firms in high technology industries relative to those in low technology industries 1 rely more heavily on advertising 2 place more emphasis on product related issues e g new product development superior product warranties as a basis for building market share 3 rely more heavily on formal planning activities 4 place more emphasis on customer service support 5 rely more heavily on external financing 6 rely more heavily on premium pricing strategies and 7 have more entrepreneurial strategic postures the data also indicate that an entrepreneurial strategic posture is more positively associated with firm performance among growth seeking firms in low tech industries than among those in high tech industries although there are exceptions to this finding cluster analysis was used to identify the content and performance of various strategies operationally defined as patterns of strategic variables associated with growth seeking firms in high and low technology industries four strategies were identified through this technique two of which are most common among firms in low tech industries one of which is most common among firms in high tech industries and one of which is equally prevalent in both industry types these results corroborate several of the aforementioned findings regarding the effects of industry technological sophistication on dimensions of firm strategy for example they demonstrate the general aversion among growth seeking firms in low tech industries to premium pricing furthermore they suggest that overall growth seeking firms in low tech industries may be somewhat more disposed to pursuing cost leadership strategies and less disposed to pursuing differentiation strategies than growth seeking firms in high tech industries there were no overall performance differences across the four strategy types identified through the cluster analysis however the data suggest that an entrepreneurial strategic posture is most strongly associated with high performance among firms that have a cohesive and focused strategic mix or pattern of strategic decisions this finding holds for growth seeking firms in both industry types

do non strategic sanctions obey the law of demand the demand for punishment in the voluntary contribution mechanism abstract the prospect of receiving a monetary sanction for free riding has been shown to increase contributions to public goods we ask whether the impulse to punish is unresponsive to the cost to the punisher or whether like other preferences it interacts with prices to generate a conventional demand curve in a series of experiments we randomly vary the cost of reducing the earnings of other group members following voluntary contribution decisions in our design new groups are formed after each interaction and no subject faces any other more than once so there is no strategic reason to punish we nonetheless find significant levels of punishment and we learn that both price and the extent to which the recipient s contribution is below the group mean are significant determinants of the quantity of punishment demanded moreover punishment is mainly directed at free riders even when it costs nothing to the punisher

strategic behavior and learning in repeated voluntary contribution experiments abstract voluntary contribution experiments systematically find that contributions decline over time we use a two stage voluntary contribution game to investigate whether this decrease is caused by learning or strategic behavior using a strategy method we find a robust pattern of declining contributions contributions in stage 2 are 45 percent lower than in stage 1 repeating the game five times we find that experience generates a smaller decline in contributions stage 1 contributions decrease by around 7 percent per game finally we find no significant differences between the strategy and direct response method which suggests that our results help explain behavior in the latter

conditional cooperation and voluntary contributions to public goods we compare a partners condition where the same small group of subjects plays a repeated publi c good game to a strangers condition where subjects play this game in changing group formations subjects in the partners conditi on contribute from t he first period on significantly more to the publi c good than subjects in the strangers conditi on in the strangers conditi on contributions show a continual decay whil e in the partners conditi on contributions fluctuate on a high level until t hey decrease in the final periods we interpret subjects behavior in terms of conditional cooperation which is characterized by both future oriented and reactive behavior

adaptation and mitigation in global pollution problems economic impacts of productivity sensitivity and adaptive capacity this paper studies the influence of productivity pollution sensitivity and adaptive capacity on optimal mitigation and adaptation in a two country global pollution model we investigate the effects of changes of these parameters on the allocation of emissions adaptation expenditures and welfare in our analysis we distinguish between cooperative and non cooperative behavior our findings imply that unilateral improvements in productivity and adaptive capacity have strategic significance and do not necessarily lead to mutual welfare improvements they raise the emissions not only in the country where the technological improvement takes place but also globally an improvement in global welfare is guaranteed only under cooperative behavior with respect to emission and adaptation choices

green stimulus green recovery and global imbalances this paper assesses the extent to which g20 green stimulus initiatives enacted during the 2008 9 recession have instigated a global green recovery and how further green recovery policy initiatives by the g20 relate to concerns about chronic fiscal deficits and global imbalances implementing further green measures will require g20 economies to commit to increased public investments new pricing policies improving regulations more aid disbursements and other policy changes although there may be concern that these additional initiatives could worsen the chronic fiscal deficits and structural imbalances if properly enacted such a green economic recovery strategy should help alleviate rather than worsen unstably large fiscal deficits long term real interest rate rises and inflation and global imbalances

the timing and strategic role of self protection self protection has private goods characteristics as it reduces own exposure to pollution given a certain level of pollution we study the effect of timing self protection before after or simultaneously with abatement we find that self protection when timed before abatements has strategic effects in this case self protection shifts the second stage subgame perfect nash equilibrium of abatements such that own contributions of abatement are decreased and those of the other country are increased thereby shifting future abatement costs to the other country when countries cooperate only on abatement the incentives to shift future abatement costs are greater contrary to intention cooperation on abatement may in fact worsen environmental quality if it does not include self protection

economic and environmental impacts of the kyoto protocol in 2003 the kyoto protocol which imposes legally binding greenhouse gas emission constraints on industrialized countries is likely to enter into force the protocol has been celebrated as a milestone in climate protection but standard economic theory casts doubt that it will go beyond symbolic policy in this paper we show that the final concretion of the kyoto protocol is consistent with the theoretical prediction kyoto more or less boils down to business as usual without significant compliance costs to ratifying parties jel classification d58 q43 q58 consequences economiques et environnementales du protocole de kyoto en 2003 le protocole de kyoto qui impose aux pays industrialises l obligation de reduire leurs emissions de gaz a effet de serre entrera probablement en vigueur si le protocole a ete accueilli comme un grand pas en avant dans le combat pour proteger l environnement la theorie economique jette un regard sceptique sur la portee reelle d un tel accord et le considere comme un geste symbolique dans ce memoire on montre que la concretisation finale de l accord de kyoto s arrime aux predictions theoriques kyoto n est rien de plus que business as usual et n impliquera pas de couts significatifs pour les parties qui ont signe le protocole

carbon leakage revisited unilateral climate policy with directed technical change using a stylized theoretical model we argue that current economic analyses of climate policy tend to over estimate the degree of carbon leakage as they abstract from the effects of induced technological change we analyse carbon leakage in a two country model with directed technical change where only one of the countries enforces an exogenous cap on emissions climate policy induces changes in relative prices that cause carbon leakage through a terms of trade effect however these changes in relative prices also affect the incentives to innovate in different sectors this leads to a counterbalancing induced technology effect which always reduces carbon leakage we therefore conclude that the leakage rates reported in the literature may be too high as these estimates neglect the effect of price changes on the incentives to innovate

unilateral co2 reductions and carbon leakage the consequences of international trade in oil and basic materials a recursively dynamic general equilibrium model featuring six world regions with trade in energy and non energy goods is used to simulate the period from 1990 through 2100 in 10 year intervals the simulations explore the effect of unilateral action by the oecd to curb global co2 emissions unilateral cuts create incentives for free riding by non participating regions so that global emissions are reduced by less than the amount that the oecd cuts back its regional emissions carbon leakage occurs through two channels first basic materials production increases in unconstrained regions resulting in increased carbon intensity of gdp second reductions in oecd oil imports cause the world oil price to fall leading to an increased energy intensity in the non participant regions in this paper we use a general equilibrium model to assess the extent to which these two mechanisms reduce the effectiveness of oecd reductions in curbing global co2 concentrations

adaptation for mitigation this paper develops a two region north and south dynamic model in which regional stocks of effective labor are negatively influenced by the global stock of pollution by characterizing the equilibrium strategy of each region we show that the regions best responses can be strategic complements through a dynamic complementarity effect the model is then used to analyze the impact of adaptation assistance from north to south it is shown that north s unilateral assistance to south thus enhancing south s adaptation capacity can facilitate pollution mitigation in both regions especially when the assistance is targeted at labor protection pollution might increase in the short run but in the long run the level of pollution will decline the adaptation assistance we propose is incentive compatible and pareto improving

investment and adaptation as commitment devices in climate politics the strategic roles of adaptation and technological investment in international climate politics have been analyzed within various approaches what makes this paper unique is that we investigate the combined impact of adaptation and investment on global mitigation and we compare the subgame perfect equilibria for different sequences of decisions considering a purely non cooperative game theoretic framework we find that by investment countries commit to lower national contributions to the global public good of mitigation moreover the order of adaptation before mitigation might reinforce this strategic effect of technological investments as a consequence the subgame perfect equilibrium for symmetric countries yields a globally lower level of mitigation and higher global costs of climate change when countries engage in advanced adaptation besides this theoretical contribution the paper proposes some strategies to combat the unfortunate rush to adaptation which can be currently observed in climate politics

weitzman revisited emission standards versus taxes with uncertain abatement costs and market power of polluting firms studies dealing with the optimal choice of pollution control instruments under uncertainty have invariably taken it for granted that regulated firms face perfectly competitive markets by introducing the product market into the stochastic framework of weitzman rev econ stud 41 477 491 1974 this paper shows for the case of a polluting symmetric cournot oligopoly that weitzman s policy rule for choosing emission standards versus taxes with uncertain abatement costs is biased in the presence of market power since the oligopolists take into account their influence on the market price their total abatement effort including the restriction of output is less vulnerable to miscalculations of the tax rate compared to price taking firms consequently the comparative advantage of instruments is shifted in favour of taxes in a further step the provided policy recommendations are generalised by abolishing the assumption that firms are symmetric

strategic behavior in public good games when partners drift apart abstract in a public good experiment one group member is replaced by another after a prespecified number of periods evidence of both strategic forward looking and adaptive backward looking behavior is observed

here today gone tomorrow can dynamic incentives make microfinance more flexible this paper presents a model of microfinance lending to individuals that uses dynamic incentives in the form of access to additional loans to discourage borrowers from strategic default or the unwillingness to repay a loan once a positive outcome is realized we propose an improvement on contracts currently used by microfinance institutions mfis by endogenizing the default penalty while constraining the mfi to maintain sustainable lending operations furthermore accounting for the risks that the poor face by including a negative economic shock we show that under certain circumstances the punishment for default need not be a lifetime without loans

self insurance against natural disasters abstract expenditures on self insurance to mitigate the effects of natural disasters on the value of private assets are examined in a model where individuals are partially insured against financial loss by a public relief program and where private insurance is unavailable the model predicts that optimal private expenditures on self insurance will be excessive or insufficient according to the nature of the technology by which individuals protect their assets the comparative static effects of variations in the level of public compensation individual wealth and attitudes toward risk and the degree of environmental uncertainty on self insurance expenditures and on the magnitude and frequency of public compensation are also characterized and their implications for remedial government policies are examined

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

social security in a classical growth model this paper develops a growth model with overlapping generations of workers who save for life cycle reasons and ricardian capitalists who save from a bequest motive the population of workers accommodates growth so that the rate of capital accumulation is endogenous and determines the growth of employment two regimes are possible one in which workers saving dominates the long run and a second in which the long run equilibrium growth rate is determined completely by the capitalist saving function sometimes called the cambridge equation the second regime exhibits a version of the pasinetti paradox changes in workers saving affect the level but not the growth rate of capital in the long run applied to social security this result implies that an unfunded system relying on payroll taxes reduces workers lifetime wealth and saving creating level effects on the capital stock without affecting its long run growth rate these effects are mitigated by the presence of a reserve fund various levels of which are examined calibrating the model to realistic parameter values for the us facilitates an interpretation of the controversies over the percentage of the national wealth originating in life cycle saving and the effects of social security on saving the model is offered as an analytical framework for the review of current topics in fiscal policy in particular identifying the social security reserve fund as a potential vehicle for generating capital accumulation and effecting a progressive redistribution of wealth copyright 2004 oxford university press

information sharing in credit markets we present a model with adverse selection where information sharing between lenders arises endogenously lenders incentives to share information about borrowers are positively related to the mobility and heterogeneity of borrowers to the size of the credit market and to advances in information technology such incentives are instead reduced by the fear of competition from potential entrants in addition information sharing increases the volume of lending when adverse selection is so severe that safe borrowers drop out of the market these predictions are supported by international and historical evidence in the context of the consumer credit market a large body of literature on credit markets has shown that asymmetric information may prevent the efficient allocation of lending leading to credit rationing e g jaffee and russell 1976 stiglitz and weiss 1981 or to a wedge between lending and borrowing rates e g king 1986 in this literature informational asymmetries are taken to be exogenous lenders fail to observe some relevant characteristic or action of potential borrowers and have no way of learning about it in some countries however lenders can improve their knowledge about new customers by exchanging information with other lenders through information brokers generally known as credit bureaus the latter collect file and distribute the information voluntarily supplied by their members and operate on the principle of reciprocity lenders who do not provide data are denied access to the bureau s files in other countries instead these institutions do not exist the literature offers no guide to identify the factors that lead to endogenous communication between lenders this paper is an attempt to fill the gap information sharing is important for a number of reasons it may increase the degree of competitiveness within credit markets vives 1990 improve

scientific progress and irreversibility an economic interpretation of the precautionary principle abstract we consider the problem of the optimal use of a good whose consumption can produce damages in the future scientific progress is made over time that provides information on the distribution of the intensity of damages we show that this progress induces earlier prevention effort only if prudence is larger than twice absolute risk aversion this paper thus identifies the class of quite restrictive but plausible conditions such that scientific uncertainties justify an immediate reduction of the consumption of a potentially toxic substance

cooperative and noncooperative protection against transferable and filterable externalities given self protection from an undesirable environmental externality we examine under several conditions the efficiency properties of cooperative and noncooperative behavior we demonstrate that if self protection can transfer the externality to another agent then noncooperative behavior will lead to overprotection if self protection filters or dilutes the externality then noncooperation leads to underprotection in addition overprotection will worsen if an agent with more relative power is allowed a first mover advantage or if the damage function is elastic and transferability is uncertain finally a reduction in uncertainty about transferability will accentuate overprotection if the damage function is inelastic our results suggest that coordination of protection activities among agents will enhance the overall gains from environmental policy in the european single internal market of 1992 coordination minimizes the costs of environmental protection thereby reducing the public credibility of its foes

an equilibrium framework for global pollution problems abstract the paper analyzes global pollution problems from the point of view of the benefit approach to the allocation of public costs special attention is paid to the possibility that the optimum abatement vector may have negative elements an appropriate cost share equilibrium is defined and characterized and conditions under which the equilibrium is beneficial to all parties are derived an implementation mechanism whose nash equilibrium yields positive abatement levels under appropriate conditions is described

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

credit bureau policy and sustainable reputation effects in credit markets welfare increasing reputation effects arise in credit markets when adverse selection gives rise to borrower reputation formation incentives that mitigate moral hazard problems this paper shows that welfare stemming from reputation effects will diminish over time as the private information of borrowers is revealed to lenders in the form of lengthening credit histories aggregate borrower welfare may therefore decrease over time unless reputation effects can be sustained restricting a lender s access to a borrower s credit history via credit bureau policy is shown to be one method of sustaining reputation effects and preventing a decline in welfare copyright 1995 by the london school of economics and political science

the inefficiency of private adaptation to pollution in the presence of endogenous market structure the paper considers an industry where production costs rise due to pollution but where this effect can be partially off set by investing in adaptation as a private good the focus is not on external effects but industries where economies of scale are introduced from adapting to pollution the structure of the resulting oligopolistic market is endogenous since the level of adaptation is chosen by the firms the analysis of externalities usually disregards defensive or adaptation measures with a few exceptions that point to considerable complications the present debate on adaptation to climate change shows the importance of understanding defensive measures i show that the market failure caused by economies of scale leads to production costs above the social optimum i e to under adapation when pollution increases adaptation only increases if demand is price inelastic otherwise welfare loss from market failure decreases with pollution the total welfare loss is only convex if demand is price inelastic and the influence of pollution on production costs is stronger than the influence of adaptation concave welfare loss has crucial implications for abatement policies

is flexible labour good for innovation evidence from firm level data whether the use of flexible workers is damaging to innovation or not depends on the dominant innovation regime in a sector in sectors with a routinised innovation regime high shares of low paid temporary workers have a negative impact on the probability that firms invest in r d in sectors that tend towards a garage business regime however flexibility has no impact the two innovation regimes differ in the nature of their knowledge base reliance on generally available knowledge or dependence on a firm s historically accumulated knowledge base innovation in the latter regime benefits from longer job durations our results are consistent with findings in macro level studies that coordinated market economies with rigid labour markets have higher labour productivity gains than liberalised market economies

does inequality lead to greater efficiency in the use of local commons the role of strategic investments in capacity abstract this paper examines how inequality in access to credit affects the strategic behavior of users of a common resource in their investment and extraction decisions a dynamic two stage game is developed in which agents choose the level of sunk investment in capacity and the consequent extraction path the results show that agents invest in excess capacity except when inequality is very high the relation between inequality and efficiency in resource extraction is found to be non monotonic with the steady state resource stock being closest to the optimal level when either inequality is very high or very low

strategic enhancement and destruction of fisheries and the environment in the presence of international externalities abstract this paper considers enhancement of fisheries and the environment in the presence of international externalities by enhancement we refer to investments which affect the costs and benefits of controlling fish harvest rates or pollution emission levels in a two country two period model it is shown that enhancement may be used strategically to influence the behavior of rival governments and that the strategic effect may either offset or reinforce the standard free rider problem associated with such investment in some cases countries may have an incentive to invest in environmental destruction i e negative enhancement if policies are not coordinated internationally

free trade and global warming a trade theory view of the kyoto protocol this paper demonstrates how three important results in environmental economics true under mild conditions in closed economies are false or need serious amendment in a world with international trade in goods since the three results we highlight have framed much of the ongoing discussion and research on the kyoto protocol our viewpoint from trade theory suggests a re examination may be in order specifically we demonstrate that in an open trading world but not in a closed economy setting 1 unilateral emission reductions by the rich north can create self interested emission reductions by the unconstrained poor south 2 simple rules for allocating emission reductions across countries such as uniform reductions may well be efficient even if international trade in emission permits is not allowed and 3 when international emission permit trade does occur it may make both participants in the trade worse off and increase global emissions

strengthening of energy security low carbon growth in asia role of regional energy cooperation through trade abstract prudent demand supply management of energy is pivotal for the energy security of the countries and transitions towards the sustainable low carbon energy system this study empirically investigates the existing demand supply gaps of energy in the south though east asian stea countries and analyzes how the gaps can be minimized most efficiently through intraregional energy trade stochastic frontier gravity model extended with the determinants of efficiency models used for both primary energy and renewable energy goods reg trade the result implies that for most of the countries intraregional export of primary energy as well as reg are positively influenced by gross domestic products gdp of the exporting and importing countries tariff and distance adversely affect the exports while the implication of cross exchange ratio seems minimal in both cases regional trade agreements rta are also found to have notable positive impact on intraregional trade results show that china and thailand are the most efficient in this intraregional primary energy export while bangladesh and myanmar remain the least efficient china and japan are the most efficient in reg exports while bangladesh remains the least efficient on average the whole region has the weighted export efficiency of 56 5 in intraregional primary energy trade and 63 1 in reg trade the determinants of efficiency model reveals that institutional quality better infrastructure goods market efficiency and technological readiness have reasonable impacts to enhance the countries intraregional energy trade efficiencies

heterogeneous beliefs and climate catastrophes we study how heterogeneous beliefs about the causes and extent of global warming affect local mitigation and adaptation strategies and therefore global climate dynamics local policies are determined by expectations of policy makers about future climate there are three types of expectations strong skeptic weak skeptic and science based strong skeptics deny human induced climate change and a possibility of a climate catastrophe weak skeptics believe that industrial emissions cause global warming but deny catastrophic climate change science based policy makers considering the warning of the scientific community account for both human influence on climate and possible catastrophic shifts aggregate behavior of policy makers determines the total emission level which influences global climate dynamics the paper argues that even if there are only skeptical policy makers the climate catastrophe can still be avoided