renewable and non renewable energy growth emissions linkages review of emerging trends with policy implications abstract this study is an extension of the previous studies which focused mainly on energy growth nexus but fails to consider the carbon emission implication of this relationship the methodology of the study permits a comprehensive and comparative analysis of existing studies on renewable and non renewable energy growth emission nexus in order to draw some implications for policy and research the survey revealed the extent of the spread of studies across issues time and geographical space countries and regions it also disclosed the range of methodological approaches adopted to analyse the issues over time and the frequency of their use it unravelled the varied findings across countries and regions given the diverse methods employed and specific features of the economies analysed arising from the literature survey this study highlights the existing gaps in the literature and new direction for policy and research the general policy implication of the findings of this study is that pollution effect of energy growth nexus should be taken into consideration in policy formulation for sustainable development further the design of regional and global policies should recognise the fact that energy growth emission linkages varied across countries even in the same region some new direction for research on renewable and non renewable energy growth emission linkages pointed out in this survey includes the following future research on energy growth nexus without considering the pollution impact may not contribute so much to the literature studies should investigate the substitution complementary effects of the energy varieties on growth emission nexus while new methodological contributions are imperative

cores of inventory centralization games abstract consider a set of n stores with single item and single period demands assume an option of centralized ordering and inventory with holding and penalty costs only in this case a cooperative inventory centralization game defines allocations of the cost we examine the conditions under which such an inventory centralization game has a nonempty core we prove the existence of nonempty core for demands with symmetric distributions and the existence of nonempty core for joint multivariate normal demand distribution we establish the equivalency of four different nonempty core conditions for the newsboy problem and demonstrate their efficacy for discrete independent and identically distributed iid demands journal of economic literature classification numbers c44 c62 c71

collaborative replenishment in the presence of intermediaries in complex supply chains downstream buyers would often replenish individually from intermediaries instead of directly dealing with original manufacturers although collaborative replenishment from intermediaries might generate benefits significant cost reductions could be achieved when direct replenishments from manufacturers are considered this paper constructs a general model to study collaborative replenishment in multi product chains with alternative sources of supply i e manufacturers and intermediaries a collaborative organization determines the optimal choices of replenishment sources on behalf of its members to minimize collective costs we introduce a class of cooperative games associated with these situations and give sufficient conditions for their concavity we investigate the choice of allocation rule and its effect on supply chain efficiency when buyers strategically participate in the collaborative organization we prove that the shapley value coordinates the supply chain i e it makes complete participation the best strategy for buyers even under asymmetric information this setting is compared with an alternative structure where buyers can only collaborate in source specific replenishment organizations that purchase all requested products either from intermediaries or manufacturers although there are always participation strategies that result in minimum collective cost it is impossible to find allocation rules for source specific replenishment organizations that always motivate the buyers to choose such strategies

timing problems in contract breach decisions in contracts susceptible to efficient breach each party has an american option to breach and pay damages rather than perform she will repudiate early if the expected decrease in damages liability resulting from her partner s mitigation exceeds the expected value of the terminated contract including the option to breach in the future we show that each party has the incentive to repudiate earlier than socially optimal because expectation damages compensate the nonrepudiating party only for the loss of the completed exchange and not the value of its lost breach option this inefficiency is particularly acute in long term fixed price contracts in which the cost of performance to the promisor and the value to the promisee are volatile and uncorrelated we explore various responses to this problem including vertical integration changes in contract remedies including specific performance flexible price provisions and the capital structure of each party

energy consumption and gdp in developing countries a cointegrated panel analysis in this paper we re investigate the co movement and the causality relationship between energy consumption and gdp in 18 developing countries using data for the period 1975 to 2001 recently developed tests for the panel unit root heterogeneous panel cointegration and panel based error correction models are employed the empirical results provide clear support of a long run cointegration relationship after allowing for the heterogeneous country effect the long run relationship is estimated using a full modified ols the evidence shows that long run and short run causalities run from energy consumption to gdp but not vice versa this result indicates that energy conservation may harm economic growth in developing countries regardless of being transitory or permanent

estimating the impact of the hajj religion and tolerance in islam s global gathering we estimate the impact on pilgrims of performing the hajj pilgrimage to mecca our method compares successful and unsuccessful applicants in a lottery used by pakistan to allocate hajj visas pilgrim accounts stress that the hajj leads to a feeling of unity with fellow muslims but outsiders have sometimes feared that this could be accompanied by antipathy toward non muslims we find that participation in the hajj increases observance of global islamic practices such as prayer and fasting while decreasing participation in localized practices and beliefs such as the use of amulets and dowry it increases belief in equality and harmony among ethnic groups and islamic sects and leads to more favorable attitudes toward women including greater acceptance of female education and employment increased unity within the islamic world is not accompanied by antipathy toward non muslims instead hajjis show increased belief in peace and in equality and harmony among adherents of different religions the evidence suggests that these changes are likely due to exposure to and interaction with hajjis from around the world rather than to a changed social role of pilgrims upon return

disaggregate energy consumption employment and income in turkey the purpose of this paper is to contribute to literature on energy consumption and economic growth relationship by examining how much of the variance in national income growth can be explained by the growth of different sources of energy consumption and employment in turkey we use the recently developed generalized forecast error variance decomposition technique of koop et al j econom 74 1996 119 and pesaran and shin econ lett 58 1998 17 to determine the information content of the growth rate of energy consumption waste seems to have the largest initial impact followed by oil however over a 3 year horizon lignite appears to explain the largest forecast error variance of gdp the total energy consumption explains 21 of forecast error variance of gdp energy consumption appears to be almost as important as employment in turkey therefore policy makers may be interested in identifying the energy dependencies of economic growth in allocating the energy investment budget

co2 emissions non renewable and renewable electricity production economic growth and international trade in italy abstract this paper applies the autoregressive distributed lag ardl bounds testing approach to cointegration to investigate the dynamic causal relationships between co2 emissions per capita real gdp per capita per capita non renewable electricity production and per capita renewable electricity production and international trade in the case of italy from 1960 to 2011 we find cointegration among these variables in the presence of possible structural breaks and we overcome the problem of multicollinearity in the research design the environmental kuznets curve ekc hypothesis is validated analytically because the estimated pollution model indicates that economic growth leads to less pollution over time per capita renewable electricity production reduces the level of co2 emissions per capita in the short run and in the long run whereas international trade only impacts positively upon carbon dioxide emissions per capita in the long run international trade granger causes co2 emissions per capita and non renewable electricity production per capita moreover the results depict the existence of the long run unidirectional granger causality relation running from output per capita to renewable electricity production per capita and from non renewable electricity production per capita to renewable electricity production per capita the findings indicate that renewable electricity production is a key solution in reducing pollutant emissions over time this result should be of concern to policy makers

the causality relationship between energy consumption and gdp in g 11 countries revisited abstract this paper explores whether energy conservation policies can be implemented in countries with the same level of development that is is restraining energy consumption without compromising economic growth feasible in all industrialized countries a new granger non causality testing procedure developed by toda and yamamoto 1995 journal of econometrics 66 225 250 is applied to re investigate the relationship if any between energy consumption and income in 11 major industrialized countries the results clearly do not support the view that energy consumption and income are neutral with respect to each other except in the case of the united kingdom germany and sweden where a neutral relationship is found bi directional causality in the united states and uni directional running from energy consumption to gdp in canada belgium the netherlands and switzerland are found this indicates that energy conservation may hinder economic growth in the latter five countries further the causality relationship appears to be uni directional but reversed for france italy and japan which implies that in these three countries energy conservation may be viable without being detrimental to economic growth

effects of renewable energy sector development on electricity consumption growth nexus in the european union abstract the aim of this study is to assess the effect of renewable energy sector development on the relationships between electricity consumption and economic growth in the european union countries in the period between 1995 and 2015 a panel vector autoregressive model is used for testing granger causality and estimating impulse response functions the results indicate that the relationships between economic growth and electricity consumption depend on the level of renewable energy sector development the greater the share of the renewable energy sector in the economy is the more noticeable the mutual dependence between the economic growth and renewable electricity consumption is in countries with relatively well developed renewable energy sectors renewable electricity consumption boosts the economy and vice versa in the remaining countries economic growth and electricity consumption are independent empirical findings suggest that policymakers should develop strategies to implement clean energy policy aimed at stimulating the development of the renewable energy sector to support economic growth

the newsvendor game has a nonempty core we settle an open conjecture regarding the newsvendor game we prove that its core is always non empty for all possible joint distributions of the random demands we give sufficient conditions under which the core is a singleton or it contains non negative elements

a model of positive self image in subjective assessments this paper suggests a mechanism that describes individuals positive self image in subjective assessments of their relative abilities the mechanism assumes individuals have heterogeneous production functions that determine ability as a function of multiple skills make skill enhancing investments with the goal of maximizing their ability and make ability comparisons using their own production function within this framework the paper provides conditions under which there is positive self image positive self image is increasing in the ease of the task the number of different skills needed for the task and the variability of production technologies in the population

channel bargaining with risk averse retailer abstract we first consider a supply chain with one manufacturer and one retailer where there is only one product with stochastic demand the retailer is risk averse with conditional value at risk cvar as her risk measure and the manufacturer is a risk neutral agent we model the problem as a nash bargaining problem where the manufacturer and the retailer negotiate about the wholesale price and order quantity we show that there exists a nash bargaining equilibrium for the wholesale price and order quantity with equal and unequal bargaining power we also find that even for the equal bargaining power between the two agents the retailer s bargaining power for the supply chain profit increases as she becomes more risk averse we then extend the model to the case where demand is endogenous and can be manipulated by setting the retail price we show that there exists a nash bargaining equilibrium for the wholesale price retail price and the order quantity under equal bargaining power

the competitive newsboy we consider a competitive version of the classical newsboy problem in which a firm must choose an inventory or production level for a perishable good with random demand and the optimal solution is a fractile of the demand distribution and investigate the impact of competition upon industry inventory a splitting rule specifies how initial industry demand is allocated among competing firms and how any excess demand is allocated among firms with remaining inventory we examine the relation between equilibrium inventory levels and the splitting rule and provide conditions under which there is a unique equilibrium our most general result is that if all excess demand is reallocated i e there is perfect substitutability then competition never leads to a decrease in industry inventory

granger non causality tests between non renewable energy consumption and output in italy since 1861 the ir relevance of structural breaks abstract the present paper considers an italian dataset with an annual frequency from 1861 to 2000 it implements granger non causality tests between energy consumption and output contrasting methods allowing for structural change with those imposing parameter stability throughout the sample though some econometric details can differ results have clear policy implications energy conservation policies hasten an underlying tendency of the economy towards a more efficient use of fossil fuels the abandonment of traditional energy carriers was a positive change the challenge for renewable energy is to diversify among different sources and to overcome possible social acceptance problems

a comparison of milestone based and buyout options contracts for coordinating r d partnerships we analyze optimal contractual arrangements in a bilateral research and development r d partnership between a risk averse provider that conducts early stage research followed by a regulatory verification stage and a risk neutral client that performs late stage development activities including production distribution and marketing the problem is formulated as a sequential investment game with the client as the principal where the investments are observable but not verifiable the model captures the inherent incentive alignment problems of double sided moral hazard risk aversion and holdup we compare the efficacy of milestone based options contracts and buyout options contracts from the client s perspective and identify conditions under which they attain the first best outcome for the client we find that milestone based options contracts always attain the first best outcome for the client when the provider has some bargaining power in renegotiation and identify their applicability to different r

renegotiation design with unverifiable information this paper considers a buyer seller relationship with observable but unverifiable investments and or random utility parameters in such situations it is known that contract renegotiation may prevent the implementation of first best outcomes in this paper we show however that efficient investments and optimal risk sharing can typically be achieved provided the initial contract is able to monitor the ex post renegotiation process specifically we focus on the following two features of renegotiation design first default options in case renegotiation breaks down second the allocation of all bargaining power to either contracting party moreover we show that these two features can be obtained in standard rubinstein bargaining games through contractual provisions such as specific performance clauses and penalties for delay or equivalently financial hostages refundable without interest

future capacity procurements under unknown demand and increasing costs in this paper we study a situation in which a broker must manage the procurement of a short life cycle product as the broker observes demand for the item she learns about the demand process however as is often the case in practice it becomes either more difficult or more expensive to procure the item as the selling season advances thus the broker must trade off higher procurement costs against the benefit of making ordering decisions with better information about demand problems of this type arise for example in the travel industry where a travel agent s cost of procuring airline and hotel reservations increases as the date of a vacation package approaches we develop a newsvendor like characterization of the optimal procurement policy in a numerical analysis we demonstrate how broker procurements tend to cluster just before price increases and how brokers can benefit from explicitly considering the effects of information about demand in their ordering policies

strategic information management under leakage in a supply chain the importance of material flow management for a profit maximizing firm has been well articulated in the supply chain literature we demonstrate in our analytical model that a firm must also actively manage information flows within the supply chain which translates to controlling what it knows as well as what its competitors and suppliers know in our model of horizontal competition between an informed and an uninformed firm with a common upstream supplier material and information flows intersect through leakage of demand order information to unintended recipients as a result the informed firm s drive to control information flows within the supply chain can trigger operational losses through material flow distortion these losses can be so severe that the firm may prefer not to acquire information even when it is costless to do so our results underscore the importance of strategic information management actively managing the supply chain s information flows and making trade offs with material flows where appropriate to maximize profits

what does reputation really assure the relationship of trademarks to expectations and legal remedies i introduction klein and leffler 1981 and shapiro 1982 1983 have shown that a firm that engages in repeat transactions has an incentive to use the market as distinct from formal legal processes to assure the quality of its product the firm charges a price above salvageable costs of production and invests the premium in reputation trademark capital that it forfeits wholly or in part if it allows quality to fall below the standards it represents to its customers 1 the quality assurance hypothesis seems to be supported by stock market event studies such as those by jarrell and peltzman 1985 and karpoff and lott 1993 which show that product recalls airline crashes deceptive advertising and fraud result in trademark losses the quality assurance hypothesis however does not explain the massive size of these losses which typically are many times the outlays incurred by the firm as a result of the event the law and economics literature on contracts offers an answer to this and related puzzles suggesting that trademark capital does more than assure quality it assures specific performance that is fulfillment of the precise terms of the contract 2 after developing the specific performance hypothesis section ii we show that it is supported by the evidence from event studies furthermore it explains other phenomena not covered by the quality assurance hypothesis including why competitors of firms whose products are recalled lose wealth why some damages such as those in airline crashes intentionally fail to provide full compensation and why firms who sell to other firms also invest in trademark capital section iii we conclude with a summary and a few remarks on the issue of market versus legal forces section iv ii the specific performance hypothesis the quality assurance hypothesis focuses on the problems that arise when the physical characteristics of a commodity are costly to determine even after purchase and sellers warranties and quality representations are costly to enforce because higher quality usually costs more to produce and can be sold at a higher price producers have an incentive to represent their goods as being of higher quality than they really are or having established a reputation to cut quality and costs when consumers observe that the quality of the goods they purchase is lower than they had been led to believe they shift to lower cost lower quality goods whose quality is easier to determine higher quality goods seemingly are driven off the market klein and leffler 1981 hypothesize that a firm that engages in repeat transactions can gain by producing higher quality goods charging a price above salvageable costs of production and investing the premium in firm specific trademark capital the value of this trademark also described as reputation or goodwill is the present value of the expected stream of price premiums misrepresentation causes a reduction in this income stream and a corresponding loss in trademark capital 3 thus trademarks assure quality without a third party to enforce the contract 4 a buyer however is concerned about other characteristics of a transaction besides the physical attributes of the product the expected harm if the seller breaches the contract for example by misrepresenting the product failing to deliver it on time or failing to provide future service and the ability of the legal system to assure full compensation also matter accordingly a seller who engages in repeat transactions has an incentive to provide a bond that assures specific performance rather than just product quality when a breach results in damages that are hard to measure and the legal system does not enforce contracts costlessly the next task therefore is to examine the limitations of the legal system in enforcing contracts and providing compensation in case of breach specific performance and penalty clauses the courts could require contracting parties to provide specific performance

a three stage model for a decentralized distribution system of retailers we present and study a three stage model of a decentralized distribution system consisting ofn retailers each of whom faces a stochastic demand for an identical product in the first stage before the demand is realized each retailer independently orders her initial inventory in the second stage after the demand is realized each retailer decides how much of her residual supply demand she wants to share with the other retailers in the third stage residual inventories are transshipped to meet residual demands and an additional profit is allocated our model is an extension of the two stage model of anupindi et al abz 2001 which implicitly assumes that all residuals enter the transshipment stage we show however that allocation rules in the third stage based on dual solutions which were used in the abz model may induce the retailers to hold back some of their residual supply demand in general we study the effect of implementing various allocations rules in the third stage on the values of the residual supply demand the retailers are willing to share with others in the second stage and the trade off involved in achieving an optimal solution for the corresponding centralized system

uncertainty about uncertainty and delay in bargaining we study a one sided offers bargaining game in which the buyer has private information about the value of the object and the seller has private information about his beliefs about the buyer s valuation we show that this uncertainty about uncertainties dramatically changes the set of outcomes in particular second order beliefs can lead to a delay in reaching agreement even when the seller makes frequent offers we show that not all types of second order beliefs lead to a delay when the buyer assigns positive probability to the seller knowing the buyer s value then delay not only can occur but it must occur for a class of equilibria however in all other cases delay will never occur

coordinating investment production and subcontracting we value the option of subcontracting to improve financial performance and system coordination by analyzing a competitive stochastic investment game with recourse the manufacturer and subcontractor decide separately on their capacity investment levels then demand uncertainty is resolved and both parties have the option to subcontract when deciding on their production and sales we analyze and present outsourcing conditions for three contract types 1 price only contracts where an ex ante transfer price is set for each unit supplied by the subcontractor 2 incomplete contracts where both parties negotiate over the subcontracting transfer and 3 state dependent price only and incomplete contracts for which we show an equivalence result while subcontracting with these three contract types can coordinate production decisions in the supply system only state dependent contracts can eliminate all decentralization costs and coordinate capacity investment decisions the minimally sufficient price only contract that coordinates our supply chain specifies transfer prices for a small number 6 in our model of contingent scenarios our game theoretic model allows the analysis of the role of transfer prices and of the bargaining power of buyer and supplier we find that sometimes firms may be better off leaving some contract parameters unspecified ex ante and agreeing to negotiate ex post also a price focused strategy for managing subcontractors can backfire because a lower transfer price may decrease the manufacturer s profit finally as with financial options the option value of subcontracting increases as markets are more volatile or more negatively correlated

exploring the relationship between energy use and economic growth with bivariate models new evidence from g 7 countries abstract there is a rapidly growing literature on the interaction between energy use and economic development with many analysts drawing policy conclusions on the basis of granger causality tests that involve only an energy and an economic variable this paper attempts to demonstrate empirically that such studies although useful for certain applications may be of limited use for policy purposes after outlining theoretical and methodological issues associated with such approaches i apply bivariate energy economy causality tests for canada france germany italy japan the united kingdom and the united states using aggregate and sectoral data and three different modern econometric methods the results which are often contradictory or economically implausible illustrate explicitly that one should be cautious when drawing policy implications with the aid of bivariate causality tests on small samples i therefore underline the importance of utilizing as large sample sizes as possible and using multivariate models which are closer to economic theory accommodate several mechanisms and causality channels and provide a better representation of real world interactions between energy use and economic growth

renewable energy consumption and income in emerging economies abstract increased economic growth and demand for energy in emerging economies is creating an opportunity for these countries to increase their usage of renewable energy this paper presents and estimates two empirical models of renewable energy consumption and income for a panel of emerging economies panel cointegration estimates show that increases in real per capita income have a positive and statistically significant impact on per capita renewable energy consumption in the long term a 1 increase in real income per capita increases the consumption of renewable energy per capita in emerging economies by approximately 3 5 long term renewable energy per capita consumption price elasticity estimates are approximately equal to 0 70

applied econometrics and implications for energy economics research abstract developments in applied econometrics particularly with regard to unit root tests and cointegration tests have motivated a rich empirical literature on energy economics over the last decade this study reviews recent developments in time series econometrics applications in the energy economics literature we first consider the literature on the integration properties of energy variables we begin with a discussion of the implications of whether energy variables contain a unit root and proceed to examine how results differ according to the specific unit root or stationarity test employed we then proceed to examine recent developments in the literature on cointegration granger causality and long run estimates between disaggregated energy consumption and economic growth we review both single country and panel studies and pay particular attention to studies which have expanded the literature through adding variables such as financial development and trade in addition to energy consumption to the augmented production function as well as studies which have extended the literature through examining disaggregated energy consumption by type in each case we highlight best practice in the literature point to limitations in the literature including econometric modeling challenges and suggest recommendations for future research a key message of our survey is that the profession needs to guard against overload of research in these areas as most applied studies are no longer adding anything more to what is already known

how economic growth renewable electricity and natural resources contribute to co2 emissions abstract this study explores the relationship between economic growth and co2 emissions in the so called european union 5 eu 5 countries germany france italy spain and the united kingdom for the 1985 2016 period in doing so we employ a carbon emission function to investigate the environmental kuznets curve phenomenon which describes a relationship between economic growth and environmental degradation the empirical results confirm the existence of an n shaped relationship between economic growth and co2 emissions in the eu 5 countries we incorporate additional variables such as renewable electricity consumption trade openness natural resource abundance and energy innovation to augment the carbon emission function renewable electricity consumption natural resources and energy innovation improve environmental quality while trade openness and the interaction between economic growth and renewable electricity consumption exert a positive impact on co2 emissions this study is novel in that it presents an interaction between economic growth and renewable electricity consumption we also confirm the need for renewable energy regulations related to increasing renewable sources and promoting energy innovation to reduce the negative effects of energy and fossil energy resources on environmental degradation

strategic investments trading and pricing under forecast updating this paper considers two independent firms that invest in resources such as capacity or inventory based on imperfect market forecasts as time progresses and new information becomes available the firms update their forecasts and have the option to trade their resources the trade contract is determined as the bargaining equilibrium or alternatively as the price equilibrium assuming a fairly general form of the profit functions we characterize the nash equilibrium investment levels which are first best under the price equilibrium trade contract but not under the bargaining equilibrium trade contract to gain additional insights we then focus on firms that face stochastic demand functions with constant price elasticity and have contingent pricing power assuming a general forecast evolution process we characterize the impact of the option to trade and the firms cooperation on equilibrium investments expected prices profits and consumer surplus finally to study the main driving forces of trading we employ a well established and empirically tested forecast updating model in which the forecast evolution process follows a two dimensional geometric brownian motion under this model we prove that the equilibrium investments expected prices profits and consumer surplus are nondecreasing in the quality and timing of forecast revisions in market variability and in foreign exchange volatility but are nonincreasing in market correlation

energy consumption and economic growth a causality analysis for greece abstract this paper investigates the causal relationship between aggregated and disaggregated levels of energy consumption and economic growth for greece for the period 1960 2006 through the application of a later development in the methodology of time series proposed by toda and yamamoto 1995 at aggregated levels of energy consumption empirical findings suggest the presence of a uni directional causal relationship running from total energy consumption to real gdp at disaggregated levels empirical evidence suggests that there is a bi directional causal relationship between industrial and residential energy consumption to real gdp but this is not the case for the transport energy consumption with causal relationship being identified in neither direction the importance of these findings lies on their policy implications and their adoption on structural policies affecting energy consumption in greece suggesting that in order to address energy import dependence and environmental concerns without hindering economic growth emphasis should be put on the demand side and energy efficiency improvements

holdups standard breach remedies and optimal investment in bilateral trading problems the parties may be hesitant to make relationship specific investments without adequate contractual protection we postulate that the parties can sign noncontingent contracts prior to investing and can freely renegotiate them after information about the desirability of trade is revealed we find that such contracts can induce one party to invest efficiently when courts impose either a breach remedy of specific performance or expectation damages moreover specific performance can induce both parties to invest efficiently if a separability condition holds expectation damages on the other hand is poorly suited to solve bilateral investment problems forthcoming the american economic review please contact the program in law and economics at boalt hall school of law uc berkeley berkeley ca 94720 for a copy of this paper

social acceptance of renewable energy innovation an introduction to the concept this paper introduces the special issue on social acceptance of renewable energy innovation it is a collection of best papers presented at an international research conference held in tramelan switzerland in february 2006 while there are ambitious government targets to increase the share of renewable energy in many countries it is increasingly recognized that social acceptance may be a constraining factor in achieving this target this is particularly apparent in the case of wind energy which has become a subject of contested debates in several countries largely due to its visual impact on landscapes this paper introduces three dimensions of social acceptance namely socio political community and market acceptance factors influencing socio political and community acceptance are increasingly recognized as being important for understanding the apparent contradictions between general public support for renewable energy innovation and the difficult realization of specific projects the third dimension market acceptance has received less attention so far and provides opportunities for further research particularly from management scholars

procurement and renegotiation parties bound by an incomplete contract have an incentive to renegotiate after acquiring new information the issue of the parties investment in the relationship before renegotiation is analyzed in a simple two period procurement model the firm invests in the first period it then learns its production cost and the sponsor learns its value for the project williamson s underinvestment presumption is shown to hold under very general assumptions about bargaining and about the ex post asymmetry of information as long as the firm s investment is not observable by the sponsor the introduction of a cancellation fee may well lead to even less investment contrary to what is sometimes argued the role of ex ante price fixing as an alternative way to reintroduce some form of commitment and the problem of cost overruns are discussed last it is shown that if investment is observable by the sponsor andthus may become a joint decision variable the two parties may choose to under or overinvest

adverse selection and renegotiation in procurement as was shown by dewatripont optimal long term contracts are generally not sequentially optimal the parties ex post renegotiate them to their mutual advantage this paper fully characterizes the equilibrium of a simple two period procurement situation and studies the extent to which renegotiation reduces ex ante welfare i a central result is that like in the non commitment case the second period allocation is optimal for the principal conditionally on his posterior beliefs about the agent ii the first period allocation exhibits an increasing amount of pooling when the discount factor grows iii with a continuum of types it is never optimal to induce full separation the paper also analyzes whether renegotiated long term contracts yield outcomes resembling those under either unnegotiated long term contracts or a sequence of short term contracts and it links the analysis with the multiple unit durable good monopoly problem

decentralizing cross functional decisions coordination through internal markets a firm faces many problems that are inherently cross functional to solve them successfully requires the coordinated actions of many functional representatives acting in a decentralized setting functional managers however respond to their own individual incentives and may consequently fail to maximize the overall profits of the firm we examine this issue in a setting in which the output of early actions limits the range of later actions and we propose an incentive scheme that allows the system to be successfully decentralized our mechanism is based on linear transfer prices for the intermediate output that are implemented through an internal market a market maker buys the output from one function and sells it to another she is not obliged to sell at the same price at which she bought and may set prices solely to provide incentives we illustrate the flexibility of the scheme by applying it to several models in the operations management literature

regional spillover effects of renewable energy generation in italy in a multivariate setting we document that renewable energy generation has a positive impact on economic growth at the regional level in italy we do so by adopting panel data unit root and cointegration tests as well as granger non causality tests relying on the system gmm estimator our results are interpreted in three ways renewable energy generation alleviates balance of payments constraints and reduces the exposure of a regional economy to the volatility of the price of fossil fuels and to negative environmental and health externalities deriving from non renewable energy generation therefore our evidence supports policies promoting renewable energy generation in an appendix we show that our results are robust to the adoption of alternative econometric methods and definitions for our energy variable they are also stable over time

use renewables to be cleaner meta analysis of the renewable energy consumption economic growth nexus abstract the renewable energy consumption economic growth nexus is a growing area of research over the last few years emanating to mixed results the aim of the current study is to quantitatively synthesise the empirical literature on the subject using the meta analysis approach in particular a meta multinomial regression is employed to investigate the sources of variation in the direction of causality between renewable energy consumption and economic growth this causal relationship takes the form of four hypotheses namely the feedback conservation growth and neutrality hypotheses to the best of author s knowledge this study constitutes the first meta analysis undertaken on the renewable energy consumption economic growth nexus the empirical results reveal that the variation in the supported hypotheses is due to a number of characteristics including model specification data characteristics estimation techniques cointegration methods and causality tests and development level of the country on which a study was conducted

causal relationship between energy consumption and gdp growth revisited a dynamic panel data approach abstract this paper uses the panel data of energy consumption and gdp for 82 countries from 1972 to 2002 based on the income levels defined by the world bank the data are divided into four categories low income group lower middle income group upper middle income group and high income group we employ the gmm sys approach for the estimation of the panel var model in each of the four groups afterwards the causal relationship between energy consumption and economic growth is tested and ascertained we discover a in the low income group there exists no causal relationship between energy consumption and economic growth b in the middle income groups lower and upper middle income groups economic growth leads energy consumption positively c in the high income group countries economic growth leads energy consumption negatively after further in depth analysis of energy related data the results indicate that in the high income group there is a great environmental improvement as a result of more efficient energy use and reduction in the release of co2 however in the upper middle income group countries after the energy crisis the energy efficiency declines and the release of co2 rises since there is no evidence indicating that energy consumption leads economic growth in any of the four income groups a stronger energy conservation policy should be pursued in all countries

church state separation and redistribution we analyze how religion affects voting and redistribution our model directs attention away from the particular faith belief or risk attitudes of religious individuals and emphasizes instead how organized religion opens the door to standard group based distributive politics we argue that organized religion makes it possible for the rich and the religious poor to form electoral coalitions in favor of low taxes and limited redistribution such electoral coalitions form out of simple material self interest and they occur at the expense of the secular poor however the material reward to the religious poor from supporting such electoral coalitions depends on the institutional context as state support for religion increases poor religious voters have greater incentives to vote with poor secular voters in favor of parties that support high taxes the analysis therefore highlights the possibilities of understanding how religion affects politics without asserting that religious individuals differ systematically from secular ones in their values or preferences

sell the plant the impact of contract manufacturing on innovation capacity and profitability in the electronics industry and others original equipment manufacturers oems are selling their production facilities to contract manufacturers cms the cms achieve high capacity utilization through pooling supplying many different oems meanwhile the oems focus on innovation research and development product design and marketing we examine how this change in industry structure affects investment in innovation and capacity and thus profitability in particular innovation is noncontractible so oems will invest less in innovation than is ideal for the industry as a whole hence although contract manufacturing improves capacity utilization it may reduce the profitability of the industry as a whole by weakening the incentives for innovation contract manufacturing is not the only means to achieve capacity pooling alternatively the oems can pool capacity with one another through supply contracts or a joint venture this may result in underinvestment or overinvestment in innovation and capacity but always increases profitability we find that the sale of production facilities to a cm improves profitability for the industry as a whole if and only if oems are subsequently in a strong bargaining position vis a vis the cm if the oems are indeed very strong the gain from pooling capacity via contract manufacturing is maximized in industries with moderate cost of capacity

cooperation between multiple news vendors with transshipments we study a situation with n retailers each of them facing a news vendor problem i e selling to customers over a finite period of time product with a short life cycle such as fashion groups of retailers might improve their expected joint profit by coordinating their orders followed by transshipments after demand realization is known we analyze these situations by defining a cooperative game called a general news vendor game for such a situation with n retailers we concentrate on whether it makes sense to cooperate by studying properties of general news vendor games our main result states that general news vendor games have non empty cores

the causal relationship between electricity consumption and economic growth in the asean countries abstract this paper investigates the causal relationship between electricity consumption and economic growth among the association of south east asian nations asean 4 members namely indonesia malaysia singapore and thailand using modern time series techniques for the period 1971 2002 the results indicate that there is a bi directional causality between electricity consumption and economic growth in malaysia and singapore this means that an increase in electricity consumption directly affects economic growth and that economic growth also stimulates further electricity consumption in the two countries however uni directional causality runs from economic growth to electricity consumption in indonesia and thailand without any feedback effect thus electricity conservation policies can be initiated without deteriorating economic side effects in the two countries

green energy market development in germany effective public policy and emerging customer demand this paper reviews the development of renewable energy in germany from 1973 to 2003 it investigates the relative importance of energy policy and green power marketing in shaping the renewable energy market more than a decade of consistent policy support for renewables under the feed in law streg and its successor eeg has been an important driver for increasing renewable electricity generation to date putting the country in a better position than most of its peers when it comes to achieving european union targets for renewable energy green power marketing driven by customer demand on the other hand is growing but has had limited measurable impact so far we discuss potential intangible benefits of green power marketing and scenarios for future market development the paper concludes with lessons that can be learned from the german case for policy design and market development in other countries

renewable energy consumption co2 emissions and oil prices in the g7 countries abstract economic and societal issues related to energy security and global warming is placing greater emphasis on the consumption of renewable energy this paper presents and estimates an empirical model of renewable energy consumption for the g7 countries panel cointegration estimates show that in the long term increases in real gdp per capita and co2 per capita are found to be major drivers behind per capita renewable energy consumption these results are robust across two different panel cointegration estimators oil price increases have a smaller although negative impact on renewable energy consumption deviations from equilibrium are driven mostly by the error correction term as opposed to short term shocks short term deviations from the long term equilibrium take anywhere from between 1 3 years france and 7 3 years japan to correct

dynamics between energy output openness and financial development in sub saharan african countries abstractthis study aims to establish the connection between energy use economic output financial development and trade based on the panel data of 15 sub saharan african ssa countries during the period from 1983 to 2010 one full main panel and two subpanels were created by incorporating low income and middle income countries the panel cointegration test results indicate a long run relationship between the variables the mean group mg estimators show that energy consumption financial development capital and international trade have significant impacts on economic output in the case of middle income countries the granger causality analysis reveals that rising economic output leads to higher energy consumption but this is not true vice versa this means that energy conservation measures are unlikely to have adverse impacts upon economic output on the other hand there is a complementary relationship between financial development and energy consumption in this case energy conservation measures

efficient reliance and damage measures for breach of contract this article considers a situation where the buyer or the seller of a good must engage in expenditures on specific capital before the exchange either to prepare to use the product or to prepare to sell it it is assumed that postbreach bargaining is possible and carried out in a cooperative fashion and that buyers and sellers form expectations about the outcome of such bargaining in a specific way without enforceable contracts the potential appropriability of specific rents results in inefficiently low levels of investment three damage measures commonly used to enforce contracts are shown to produce inefficiently high levels of investment and to be pareto ranked from best to worst as follows specific performance expectation damages and reliance damages

what if energy time series are not independent implications for energy gdp causality analysis abstract time series of electricity petroleum products and renewables are found to be highly correlated with total energy consumption applying this insight to the huge literature on energy gdp causality explains that the results of total energy gdp causality tests frequently coincide with the results of energy type gdp tests using the test by toda yamamoto in combination with a cointegration based testing approach we detect such cases of concordance for 92 of the countries in our sample of 65 countries we infer that drawing specific economic conclusions with regard to single types of energy from bivariate causality analysis is difficult

on manufacturing marketing incentives stereotypically marketing is mainly concerned about satisfying customers and manufacturing is mainly interested in factory efficiency using the principal agent agency paradigm which assumes that the marketing and manufacturing managers of the firm will act in their self interest we seek incentive plans that will induce those managers to act so that the owner of the firm can attain as much as possible of the residual returns one optimal incentive plan can be interpreted as follows the owner subcontracts to pay the manufacturing manager a fixed rate for all capacity he delivers each marketing manager receives all of the returns from his product in turn all managers pay a fixed fee to the owner under this plan the marketing managers will often complain about the stock level decisions even though these levels are announced in advance under a revised plan the owner can eliminate such complaints by delegating the stocking decisions to the respective marketing managers without any loss this plan is interpreted as requiring the owner to make a futures market for manufacturing capacity paying the manufacturing manager the expected marginal value for each unit of capacity delivered receiving the realized marginal value from the marketing managers and losing money on average in the process

implications of breach remedy and renegotiation design for innovation and capacity amanufacturer writes supply contracts with n buyers then the buyers invest in innovation and the manufacturer builds capacity finally demand is realized and the firms renegotiate the supply contracts to achieve an efficient allocation of capacity among the buyers the court remedy for breach of contract specific performance versus expectation damages affects how the firms share the gain from renegotiation and hence how the firms make investments ex ante the firms may also engage in renegotiation design inserting simple clauses into the supply contract to shape the outcome of renegotiation for example when a buyer grants a financial hostage to the manufacturer or is charged a per diem penalty for delay in bargaining the manufacturer captures the gain from renegotiation tradable options which grant buyers the right to trade capacity without intervention from the manufacturer return the gain from renegotiation to the buyers this paper proves that under surprisingly general conditions the firms can coordinate their investments with the simplest of supply contracts fixed quantity contracts this may require renegotiation design and certainly requires that the firms understand the breach remedy and set their contract parameters accordingly

the economics of faith using an apocalyptic prophecy to elicit religious beliefs in the field abstract we model religious faith as a demand for beliefs following the logic of the pascalian wager we show how standard experimental interventions linking financial consequences to falsifiable religious statements can elicit and characterize beliefs we implemented this approach with members of a group that expected the end of the world to occur on may 21 2011 by varying monetary prizes payable before and after may 21st to our knowledge this is the first incentivized elicitation of religious beliefs ever conducted the results suggest that the members held extreme sincere beliefs that were unresponsive to experimental manipulations in price

signaling new product reliability with after sales service contracts prior studies on performance based contracting pbc for after sales services have highlighted its advantages over traditional resource based contracting rbc when products are established and their reliability is known to all parties we develop a game theoretic model to investigate how these insights are affected when the vendor is privately informed about the reliability of a newly developed product a novel feature of our model is the interaction between reliability signaling private information and the vendor s discretionary investment in spares inventory private action which arises naturally in the setting we consider we find that this interaction leads to contrasting equilibrium outcomes under the two contracts rbc induces the vendor to focus on inventory savings leading to underinvestment in spares whereas pbc induces the vendor to focus on reliability signaling achieved through overinvestment in inventory as a result neither contract is efficient we investigate two means to mitigate this inefficiency but either approach has caveats a making inventory verifiable removes the trade off between reliability signaling and inventory investment but results in diverging contract preferences between the vendor and the buyer b pooling inventories across multiple buyers saves inventory costs but it also hinders reliability signaling potentially exacerbating inefficiency this paper was accepted by yossi aviv operations management

signalling and renegotiation in contractual relationships this paper examines how the possibility of renegotiation affects contractual outcomes in signaling games when an infinite number of rounds of renegotiations are allowed before contracts are executed the main results of the paper are 1 contracts may still contain distortions 2 the popular efficient separating equilibrium outcome is never an equilibrium outcome with renegotiation 3 incentive compatibility constraints can be generalized to incorporate renegotiation 4 equilibrium outcomes can be separating and nevertheless depend on the uninformed player s prior and 5 renegotiation in signaling games may lead to outcomes similar to equilibrium outcomes of screening games in which multiple contract purchases are allowed copyright 1993 by the econometric society

introduction to the economics of religion after a very long hiatus economists have begun again to study the relationship between economics and religion this article seeks to summarize and evaluate the principal themes and empirical findings that have appeared in some 200 recent papers on the economics of religion although some of the research concerns the economic consequences of religiosity most applies standard economic theory to the study of individual religious activity the characteristics of religious groups and the impact of regulation and competition on religious markets

hydropower the politics of water and energy introduction and overview this special issue of energy policy is dedicated entirely to hydropower and this introductory article provides an overview of the contents it is divided into three main subject areas the present situation and history the main policy issues and the future of the hydropower industry the first area covers the evolving context the diversity and the potential of the hydropower industry and also reports on hydropower in china the country with the largest remaining potential the policy area covers the social and environmental effects the regulatory framework and public acceptance issues the discussion of the future describes the changes that are underway and still need to be made to ensure that hydropower will continue to serve the needs of society for electricity and several other important services hydropower projects can yield large benefits to society but they also entail costs and well informed decision making processes are necessary to ensure the best outcomes for a region or a country the authors who contributed to this special issue hope that their articles will provide some of the information needed for good decision making

renewable energy consumption and economic growth evidence from a panel of oecd countries abstract this study examines the relationship between renewable energy consumption and economic growth for a panel of twenty oecd countries over the period 1985 2005 within a multivariate framework given the relatively short span of the time series data a panel cointegration and error correction model is employed to infer the causal relationship the heterogeneous panel cointegration test reveals a long run equilibrium relationship between real gdp renewable energy consumption real gross fixed capital formation and the labor force with the respective coefficients positive and statistically significant the granger causality results indicate bidirectional causality between renewable energy consumption and economic growth in both the short and long run

political identity experimental evidence on anti americanism in pakistan we identify pakistani men s willingness to pay to preserve their anti american identity using two experiments imposing clearly specified financial costs on anti american expression with minimal consequential or social considerations in two distinct studies one quarter to one third of subjects forgo payments from the u s government worth around one fifth of a day s wage to avoid an identity threatening choice anonymously checking a box indicating gratitude toward the u s government we find sensitivity to both payment size and anticipated social context when subjects anticipate that rejection will be observable by others rejection falls suggesting that for some social image can outweigh self image

causality between energy and output in the long run though there is a very large literature examining whether energy use granger causes economic output or vice versa this literature is fairly inconclusive almost all existing studies use relatively short time series or panels with a relatively small time dimension additionally many recent papers continue to use what seem to be misspecified models we apply granger causality and cointegration techniques to a swedish time series data set on energy and economic growth spanning 150 years to test whether increases in energy use and energy quality have driven economic growth we show that these techniques are very sensitive to variable definition choice of additional variables in the model and sample periods all of the following appear to make a finding that energy causes growth more likely using multivariate models defining variables to better reflect their theoretical definition using larger samples and including appropriate structural breaks however it is also possible that the relationship between energy and growth has changed over time and that results from recent smaller samples reflect this energy prices have a significant causal impact on both energy use and output

the long run relationship between co2 emissions and economic activity in a small open economy uruguay 1882 2010 abstract the long term relationship between carbon dioxide co 2 emissions from energy use and economic activity level is estimated for uruguay between 1882 and 2010 we include co 2 emissions both in levels and in per capita terms which allows to analyze if a decoupling exists both in absolute and in relative terms we also test for the functional form of the relationship something that is usually missed in the literature but which is very relevant because a misspecification could lead to biased estimates we apply cointegration techniques and estimate a vector error correction model vecm for testing whether these variables are endogenous over the long term while also considering the short term dynamics the economic productive structure the degree of openness and the share of clean sources in the total energy supply are also considered as explanatory variables in addition other variables that measure changes in the economic structure are included to check for robustness of the estimates the results show that there is a linear relationship when a log log transformation is employed between co 2 emissions and per capita economic activity level which would involve an exponential relationship between the non transformed variables moreover we cannot reject the level log model indicating that emissions increase at a decreasing rate in reference to the increase in economic level activity emissions increase jointly with the industrial sector s participation in the total output as a consequence of the intensity of this activity in the consumption of energy from fossil fuel sources the degree of openness is inversely related to co 2 emissions this is because the periods of major opening were based on primary input exports which are lower in energy intensity than industrial products the changes in co 2 emission are inversely related to the variation in the share of clean sources in the total energy supply finally all the variables included in the cointegration vector are endogenous adjusting together to the deviations from the long term relationship as a consequence of the above economic growth appears not to be enough for diminishing uruguayan emissions in the long term changes in the energy matrix should be encouraged and emissions reduction should come not through energy constraints but through the development of clean sources or improvements in energy use efficiency given the impact of energy on the economic activity level

confidence enhanced performance there is ample evidence that emotions affect performance positive emotions can improve performance while negative ones may diminish it for example the fears induced by the possibility of failure or of negative evaluations have physiological consequences shaking loss of concentration that may impair performance in sports on stage or at school there is also ample evidence that individuals have distorted recollection of past events and distorted attributions of the causes of successes of failures recollection of good events or successes is typically easier than recollection of bad ones or failures successes tend to be attributed to intrinsic aptitudes or own effort while failures are attributed to bad luck in addition these attributions are often reversed when judging the performance of others the objective of this paper is to incorporate the first phenomenon above into an otherwise standard decision theoretic model and show that in a world where performance depends on emotions biases in information processing enhance welfare

strategic ignorance as a self disciplining device we analyse the decision of an agent with time inconsistent preferences to consume a good that exerts an externality on future welfare the extent of the externality is initially unknown but may be learned via a costless sampling procedure we show that when the agent cannot commit to future consumption and learning decisions incomplete learning may occur on a markov perfect equilibrium path of the resulting intra personal game in such a case each agent s incarnation stops learning for some values of the posterior distribution of beliefs and acts under self restricted information this conduct is interpreted as strategic ignorance all equilibria featuring this property strictly pareto dominate the complete learning equilibrium for any posterior distribution of beliefs

the relationship between disaggregate energy consumption and industrial production in the united states an ardl approach abstract we re examine the relationship between disaggregate energy consumption and industrial output as well as employment in the united states using the autoregressive distributed lag ardl approach developed by pesaran and pesaran pesaran m h pesaran b 1997 working with microfit 4 0 camfit data ltd cambridge and pesaran shin and smith pesaran m h shin y smith r j 2001 bounds testing approaches to the analysis of level relationships journal of applied econometrics 16 289 326 in particular we focus attention on the following energy consumption variables coal fossil fuels conventional hydroelectric power solar energy wind energy natural gas wood and waste the sample period covers 2001 1 2005 6 our results imply that real output and employment are long run forcing variables for nearly all measures of disaggregate energy consumption

renewable energy consumption and growth in eurasia this study examines the causal relationship between renewable energy consumption and economic growth for 13 countries within eurasia over the period 1992 2007 within a multivariate panel data framework the heterogeneous panel cointegration test reveals a long run equilibrium relationship exists between real gdp renewable energy consumption real gross fixed capital formation and labor force the results from the error correction models indicate bidirectional causality between renewable energy consumption and economic growth in both the short run and long run thus the empirical findings lend support for the feedback hypothesis of the interdependent relationship between renewable energy consumption and economic growth

the impact of royalty contract revision in a multistage strategic r d alliance this paper investigates the impact of royalty revision on incentives and profits in a two stage research and development r d stage and marketing stage alliance with a marketer and an innovator the marketer offers royalty contracts to the innovator we find that the potential for royalty revision leads to more severe distortions in the optimal initial royalty contracts offered by the marketer we show that if the innovator plays a significant role in the marketing stage the marketer should offer a low royalty rate initially and then revise the royalty rate up later otherwise she should do the opposite we identify two major effects of royalty revision first royalty revision provides the marketer with a flexibility to dynamically adjust royalty rates across the two stages of the alliance to better align the innovator s incentives this incentive realigning effect improves the marketer s profit second royalty revision makes it harder for the marketer to obtain private information from the innovator because the innovator worries that the marketer will take advantage of the information to revise the initial contract to a more favorable one to herself later this information revealing effect hurts the marketer s profit we characterize in what kind of alliances marketers would benefit the most from royalty revision so that managers should clearly establish the expectation for royalty revision and in what kind of alliances markerters would not benefit from royalty revision so that managers should commit not to revise the initial royalty contract with royalty contracts that are contingent on the r d outcome of the r d stage we find that contingent contract structure could be either substitutable by fully capturing the incentive re aligning effect or complementary by weakening the information revealing effect to royalty revision depending on whether the innovator plays a significant role in the marketing stage managers may need to use a contingent contract if possible either to replace or with royalty revision accordingly to improve profits this paper was accepted by kamalini ramdas entrepreneurship and innovation

coordination of channel members efforts and utilities in contract farming operations abstract one important driving force behind parties entering into contract farming agreements is to improve farmers production efforts e g buying agricultural machinery or using new planting techniques in this study we examine two widely used channel structures in contract farming operations namely firm farmer ff and firm cooperative farmer fcf structures to assess how each contract type influences the coordination of efforts and utilities by channel members first we study wholesale price and cost sharing contracts under the ff structure and find that the latter can result in a win win outcome for both channel members when the firm s cost sharing proportion is lower than a threshold level we also find that cost sharing contract effectively enlarges the opportunity of a successful ff contract farming agreement interestingly we show that the purchasing price offered by the firm has a unimodal pattern in its cost sharing proportion second under the fcf structure we consider two bargaining models based on the cooperative s commission contracts with the farmer we find that the farmer s production effort can achieve the system optimal level and the cooperative s high bargaining power helps ensure a steady fcf contract farming agreement we also find that there exists a win win win outcome for all three channel members when the cooperative s commission ratio is higher than a threshold level