wage indexation and the time consistency of government policy this paper concerns the role of wage indexation as a mechanism for enabling an economy to achieve outcomes that would not otherwise be time consistent the desirability of indexation depends on the size of real and nominal shocks and on a policymaker s incentives for short run inflation surprises policymakers incentives to utilize wage indexation are examined and it is found that weak policymakers are more likely to choose wage indexation hence in an electoral equilibrium voters may choose a policymaker who cares more about unemployment than inflation but who chooses wage indexation to commit to low inflation copyright 1995 by the editors of the scandinavian journal of economics

signalling commitment with monetary and inflation targets abstract this article studies a two period game between the public and a central bank about whose ability to commit to an announced target the public is uncertain the central bank chooses between announcing a target for an intermediate variable money growth and its goal variable inflation prior to setting its instrument the central bank receives private noisy information about the link between money growth and inflation monetary targeting facilitates communication of the central bank s type in that the probability of separation is always higher than under inflation targeting this advantage of monetary targets from a dependable central bank s perspective is outweighed for most parameter values by the advantage of inflation targeting in terms of inflation control if the regime choice is treated as a strategic decision over a large range of parameter values both central banks choose the regime that a dependable central bank would prefer

coalition proofness and dominance relations abstract we show that if a game satisfies the conditions of anonymity monotone externality and strategic substitutability then the set of coalition proof nash equilibria under strict domination contains that under weak domination

universities as strategic actors in the knowledge economy the university plays a particular role in the global knowledge economy as provider of both public and private goods related to education research and societal impacts at the same time universities in the plural play many different roles and exhibit a rich experimentation in organizational forms and knowledge foci adapting to local and global conditions there is also an aspect of uneven regional development and agglomeration of competencies as the individuals and organizations must also balance local interests and stakeholders with global networks in science technology and innovation thus we can identify empirically that universities are changing their strategies organizational structures and competencies in order to respond to new external demands and internal management practices bonaccorsi and daraio 2007 the question is how to explain this theoretically and identify empirical trends and pathways little previous research has focused upon how universities are learning to compete and why they try to act strategically this article as well as the selected articles in the special issue focus upon how and why this transition is occurring as well as the impacts for understanding universities as strategic actors in the knowledge economy section 2 provides an overview it introduces the three themes and articles collected in this special issue providing a summary of the main contributions section 3 then provides our perspective on how to analyze and understand universities as strategic actors it discusses relevant literature as a way of beginning to provide our perspective of the necessity and elements involved in a more united theoretical and empirical understanding this includes statement of predictions as well as empirical evidence that these trends are occurring section 4 concludes with relevant research themes for the future

inflation and reputation in many macroeconomic models with rational expectations optimal policy is time inconsistent and therefore announced policy may not be credible this paper models the government s credibility explicitly using kreps and wilson s analysis time consistent optimal government policy emerges as a sequential equilibrium in a repeated game this policy is at least as good as the inconsistent optimal policy and dominates the consistent policy when reputational effects are ignored thus the analysis resolves the problem of specifying a credible optimal policy in such models the results show why attempts to disinflate may lead to recession even with perfectly flexible prices this abstract was borrowed from another version of this item

macroeconomic effects of price controls the role of market structure the impetus for the current study comes from an attempt to understand the results of israel s stabilisation programme of july i985 the programme consisted of a sharp reduction in aggregate spending via an increase in net taxes and a moderate reduction in government spending a devaluation followed by a fixed exchange rate and price and wage controls the results of the programme are reported in table i in the first quarter that followed the implementation of the programme i e the third quarter of i985 aggregate spending declined exports increased imports declined the real wage rate declined and employment declined these results can be explained by a conventional competitive macroeconomic model as i will show in section ii during the next six months all the variables reversed their course this would be easy to explain with a conventional competitive model if the price controls had been removed however they were not and it is difficult to reconcile the comovement of the reported variables in their presence especially intriguing is the simultaneous increase in the real wage rate and employment this is so because in a competitive model price controls lead to excess demand in this case increased spending has no price or employment effects while a wage increase reduces employment the difficulty is further aggravated by the fact that contrary to the model s prediction almost no shortages have been observed in addition as shown in section ii partial relaxation of price controls is also incapable of explaining the data with this type of model this led me to study a macroeconomic model with oligopolistic markets i have chosen to work with a particular form of imperfect competition which proves to be useful for the purpose at hand it is however possible to think about alternatives which are also of interest clearly it is pointless to cover all these

principles of neo schumpeterian economics within the last 25 years great progress has been made in neo schumpeterian economics this branch of economic literature which deals with dynamic processes causing qualitative transformation of economies basically driven by the introduction of novelties in their various and multifaceted forms by its very nature innovation and in particular technological innovation is the most exponent and most visible form of novelty however neo schumpeterian economics should be concerned with all facets of open and uncertain developments in socio economic systems a comprehensive neo schumpeterian approach therefore has to consider not only transformation processes going on e g on the industry level of an economy but also on the public and monetary side of an economic system our contribution introduces those extensions and complements to a comprehensive neo schumpeterian economic theory and develops some signposts in the sense of a roadmap for necessary strands of analysis in the future copyright 2007 oxford university press

signalling wage controls and monetary disinflation policy focuses on wage control and monetary disinflation policy how the crucial variable to control is the money supply and wage and price controls should be avoided because of their macroeconomic costs the two types of government as being low inflation governments and high inflation governments how wage controls have microeconomic costs

transforming traditional university structures for the knowledge economy through multidisciplinary institutes within the uk considerable policy support has been provided to create multidisciplinary institutes that encourage academics to develop new knowledge for industry and societal problems we consider four large traditional uk universities that have gained significant funding for such activities we examine the changes in institutional structures necessary to enable universities to transform from single discipline based schools to multidisciplinary institutes new incentives for working across schools the cross subsidy transfer of industry funded research and teaching income and senior role models are observed to enable the development of a multidisciplinary research capability yet this capability is not easily sustained it appears that for institutes to survive beyond the initial funding round they regress towards traditional school activities of peer reviewed research and teaching we conclude that to transform academic behaviour a fundamental shift in promotion procedures which remain heavily weighted towards peer reviewed journal publication within single disciplines is required copyright the author 2012 published by oxford university press on behalf of the cambridge political economy society all rights reserved oxford university press

the drivers of efficient knowledge transfer performance evidence from british universities using data from the united kingdom this study explores the institutional and environmental factors that influence universities efficiency in knowledge transfer while studies of universities knowledge transfer performance have so far focused on patent commercialisation and research contracting with industry it is increasingly acknowledged that universities engage in a broader range of knowledge transfer activities including consulting public engagement and provision of knowledge intensive services when these are taken into account less research intensive universities and those with a greater share of staff in the arts and humanities improve their relative efficiency more specialised older and larger institutions are more efficient performers while research intensity is no longer a strong predictor of efficiency

reputation and imperfect information abstract a common observation in the informal literature of economics and elsewhere is that is multistage games players may seek early in the game to acquire a reputation for being tough or benevolent or something else but this phenomenon is not observed in some formal game theoretic analyses of finite games such as selten s finitely repeated chain store game or in the finitely repeated prisoners dilemma we reexamine selten s model adding to it a small amount of imperfect or incomplete information about players payoffs and we find that this addition is sufficient to give rise to the reputation effect that one intuitively expects

monopolistic competition credibility and the output costs of disinflation programs an analysis of price controls abstract brazil argentina and israel all used price controls as part of disinflation programs in 1985 1986 in each case they were intended to break an inertial component of inflation this paper focuses on the interaction between lack of credibility of government monetary policy announcements and the price setting behavior of forward looking firms we show that this interaction can lead to inertia extending well beyond the price setting period lack of credibility is then shown to lead to output losses during a disinflation program the paper analyses asset price behavior during disinflation programs with and without price controls and the influence of credibility problems finally we show that if past government policy has any information content about future government policy cheating on current announcements of tight policy buys current employment gains during the price control period at the cost of higher inflation afterwards sustaining low inflation after the price control period thus requires restrictive monetary policy during the price control period

rational expectations and policy credibility following a change in regime we examine the dynamic path of an economy after a change in regime when neither the policy to be followed nor the reactions of the public are known the model is an application of kreps and wilson s reputation model to barro and gordon s macroeconomic policy game equilibrium is defined to be the dynamically consistent solution to a game between the government and the private sector it involves mixed strategies and bayesian learning by both sides until the uncertainty about government and public behaviour is resolved the absence of complete credibility of government policy and intransigence of private sector wage demands increase the output loss of disinflation the analysis also sheds light on the strategic nature of economic policymaking and the role of information in macroeconomics

secure implementation experiments do strategy proof mechanisms really work strategy proofness requiring that truth telling is a dominant strategy is a standard concept used in social choice theory saijo et al 2003 argue that this concept has serious drawbacks in particular announcing one s true preference may not be a unique dominant strategy and almost all strategy proof mechanisms have a continuum of nash equilibria for only a subset of strategy proof mechanisms do the set of nash equilibria and the set of dominant strategy equilibria coincide for example this double coincidence occurs in the groves mechanism when preferences are single peaked we report experiments using two strategy proof mechanisms where one of them has a large number of nash equilibria but the other has a unique nash equilibrium we found clear differences in the rate of dominant strategy play between the two

systems thinking market failure and the development of innovation policy the case of australia innovation policy is increasingly informed from the perspective of a national innovation system nis but despite the fact that research findings emphasize the importance of national differences in the framing conditions for innovation policy prescriptions tend to be uniform justifications for innovation policy generally relate to notions of market failure that are applicable in all nations in all conditions in this paper we develop a broad framework for nis analysis involving free market coordination and complex evolutionary system approaches within this framework we explore the evolving relationship between market failure and systems approaches to innovation policy in the case of australia drawing on information and analysis collected for a major review of australia s nis and the government s 10 year plan in response to it we show how the free market trajectory of policy making of past decades is being extended complemented and refocused by new approaches to complex evolutionary system thinking these approaches are shown to emphasize the importance of systemic connectivity evolving institutions and organizational capabilities nonetheless despite the fact that there has been much progress in this direction in the australian debate the predominant logic behind policy choices still remains one of addressing market failure and the primary focus of policy attention continues to be science and research rather than demand led approaches we discuss how the development and elaboration of notions of systems failure rather than just market failure can further improve policy making in the future

equilibrium political budget cycles political business cycle theories generally rely on nominal rigidities and voter myopia this paper offers an equilibrium theory that preserves some basic insights from earlier models though with significant refinements the political budget cycle emphasized here is in fiscal policy rather than output and inflation it arises via a multidimensional signal process one can consider the welfare implications of proposals to mitigate the cycle and the effects of altering the electoral structure copyright 1990 by american economic association

university technology transfer how in efficient are french universities this paper presents the first assessment of the efficiency of the technology transfer operated by the french university system and its main determinants the analysis is based on a detailed and original database of 51 ttos categorized by type of university they belong to over the period 2003 2007 overall we find a low level of efficiency and both intra category and inter categories efficiency variation the analysis of determinants showed that french ttos efficiency depends extensively on the nature of the category with universities specialised in science and engineering being the most efficient ones on institutional and environmental characteristics we found that both the seniority of tto and size of the university have a positive effect in terms of environmental variables the intensity of rd however in terms of growth rate only the private r d activity seems to be the main driver lastly we find that the presence of a university related hospital is detrimental for the efficiency an extended discussion of the results within the existing literature is also offered

on the coalition proofness of the pareto frontier of the set of nash equilibria abstract this article shows that the pareto efficient frontier of the nash equilibrium set of games with strategic substitutes is coalition proof under the following conditions 1 the game has three players or alternatively a player s payoff depends on her own strategy and on the sum but not on the composition of other players strategies 2 an increase in a player s strategy either raises all other players payoffs monotonically or reduces them monotonically and 3 each player s payoff is strictly concave in her own strategy under these conditions the pareto dominance refinement is equivalent to the coalition proof nash equilibrium refinement journal of economic literature classification number c72

are universities and university research under threat towards an evolutionary model of university speciation according to some universities and academic research are under threat as we move towards a more knowledge intensive economy academics face pressures to link their work more closely to economic needs with potentially adverse long term consequences this has been characterised as a fundamental change in the social contract between universities and the state with the latter now having more specific expectations regarding the outputs sought from the former others have described this as a transition from mode 1 to mode 2 knowledge production or in terms of the emergence of a triple helix relationship between universities government and industry this article critically examines these claims setting them in historical context we analyse the history of the university and its evolving functions as it responded to changing external demands adopting an evolutionary model we describe how different university species emerged and co evolved each with different emphases on the functions of teaching research and contributing to the economy and society turning to the current environment facing universities we identify the main drivers for change and assess their likely impact before arriving at conclusions about the future of the university and university research what we are witnessing today appears to be not so much the appearance of a new and hence worrying phenomenon but more a shift back towards a social contract for the university closer to the one in effect before the second half of the twentieth century one which as it did then may bring about the emergence of new university species

inflationary finance under discrepion and rules inflationary finance involves first the tax on cash balances from expected inflation and second a capital levy from unexpected inflation from the standpoint of minimizing distortions these capital levies are attractive ex post to the policymaker in a full equilibrium two conditions hold 1 the monetary authority optimizes subject to people s expectations mechanisms and 2 people form expectations rationally given their knowledge of the policymaker s objectives the outcomes under discretionary policy are contrasted with those generated under rules in a purely discretionary regime the monetary authority can make no meaningful commitments about the future behavior of money and prices under an enforced rule it becomes possible to make some guarantees hence the links between monetary actions and inflationary expectations can be internalized there is a distinction between fully contingent rules and rules of simple form a simple rule allows the internalization of some connections between policy act ion and inflationary expectations but discretion permits some desirable flexibility of monetary growth this abstract was borrowed from another version of this item

cheap talk and the fed a theory of imprecise policy announcments this paper examines the problem faced by the federal reserve in announcing its private information about its future policies because it would like to manipulate expectations and pursue a time inconsistent policy the fed cannot reveal its policy objectives precisely and credibly it can however communicate some information about its goals through the cheap talk mechanism of vincent crawford and joel sobel making announcements that are imprecise and only giving ranges within which these goals may lie copyright 1989 by american economic association

optimal accommodation by strong policymakers under incomplete information abstract this paper examines the optimal behavior of a policymaker who is able to precommit labelled strong when the public entertains the possibility that he is either strong or weak unable to precommit the main result is that in the presence of doubts about their type it is optimal even for strong policymakers to partially accommodate inflationary expectations this contrasts with vickers 1986 who finds that when strength is conceived in terms of the relative concern for employment the strong policymaker inflates less under incomplete than under full information the paper also provides a theory of endogenous announcements

universities in emerging economies bridging local industry with international science evidence from chile and south africa emerging economies are now becoming more central in global competition to achieve this many countries have invested to develop into knowledge economies universities have a role to play in this transformation both as generators of new knowledge as well as actors that can interact with the local industry and contribute to its innovativeness this paper explores using two case studies in the chilean and south african wine industry how universities connect international science to domestic industry it finds that this connection occurs through a few bridging researchers who display particular characteristics compared with their colleagues bridging researchers are more talented than average researchers both because they publish more in international journals and or because they have received awards for their academic work this finding may have significant policy implications as policies aimed at strengthening the skills of these researchers should be welcomed in catching up industries copyright the author 2012 published by oxford university press on behalf of the cambridge political economy society all rights reserved oxford university press

predation reputation and entry deterrence abstract economists often argue that predatory practices are irrational since there exist cheaper or more certain means to gain or maintain a monopoly our gametheoretic equilibrium analysis suggests that if a firm is threatened by several potential entrants then predation may be rational against early entrants even if it is costly when viewed in isolation because it yields a reputation which deters other entrants asymmetric information plays a crucial role in our analysis since it provides the rationale for entrants to base their expectations of the firm s future behavior on its past actions the analysis also suggests methods to treat general reputational phenomena

price and advertising signals of product quality we present a signaling model based on ideas of phillip nelson in which both the introductory price and the level of directly uninformative advertising or other dissipative marketing expenditures are choice variables and may be used as signals for the initially unobservable quality of a newly introduced experience good repeat purchases play a crucial role in our model a second focus of the paper is on illustrating an approach to refining the set of equilibria in signalling games with multiple potential signals

reputation in a model of monetary policy with incomplete information abstract previous models of rules versus discretion are extended to include uncertainty about the policymaker s type when people observe low inflation they raise the possibility that the policymaker is committed to low inflation type 1 this enhancement of reputation gives the uncommitted policymaker type 2 an incentive to masquerade as the committed type in the equilibrium the policymaker of type 1 delivers surprisingly low inflation with corresponding costs to the economy over an extended interval the type 2 person mimics this outcome for awhile but shifts eventually to high inflation this high inflation is surprising initially but subsequently becomes anticipated

on coalition proof nash equilibria in common agency games abstract in this paper we consider two notions of a coalitional deviation strict deviation where each of member of a deviating group is better off and weak deviation where at least one member of a deviating group is better off while all other members are at least as well off we then examine for the class of common agency games introduced in bernheim and whinston quart j econ 101 1986 1 31 the structure and properties of two notions of a coalition proof nash equilibrium generated by strict and weak deviation we also study a relationship between coalition proof equilibria strong equilibria and pareto undominated nash equilibria journal of economic literature classification numbers c72 d79

crossing the rubicon exploring the factors that shape academics perceptions of the barriers to working with industry although academics are under increasing pressure to engage industry in their research they often find it difficult to do so conflicts with industry over the timing of disclosure and the choice of topics are common moreover collaborations with industry may require academics to negotiate formal contracts about the ownership of intellectual property to help understand the factors that might mitigate these conflicts this paper examines how the professional and collaborative experiences of academics shape their perceptions of the barriers to industry collaboration using a rich dataset of uk academics we find that perceived barriers to collaboration are lower for academics with industrial and collaborative experience and for those who trust their industry partners however for the transactional costs of industry engagement we find entrepreneurial experience and the diversity of methods used to collaborate with industry increases the perceived barriers to collaboration

pathways to impact and the strategic role of universities new evidence on the breadth and depth of university knowledge exchange in the uk and the factors constraining its development there has been an increasing focus on the strategic role of universities in stimulating innovation and economic growth primarily though the transfer of technology this paper interrogates some of the key aspects of much of the conventional wisdom concerning the transfer of technology and the knowledge exchange process in general it analyses the results from two unique surveys a survey of the uk academic community that generated more than 22 000 responses and a stratified survey of businesses that generated more than 2 500 responses the results suggest that much of the conventional wisdom concerning knowledge exchange involving academia is too narrowly confined or is misinformed first there is an excessive focus in much of the academic and policy discourse on commercialisation and technology transfer there are many knowledge exchange mechanisms used by academics these include commercialisation processes but also many other hidden connections second the focus on the science base ignores that knowledge exchange involves academics from all disciplines third the preoccupation with improving innovation and business performance tends to ignore that knowledge exchange involves partners from the public and third not for profit sectors as well as private sector businesses fourth the main constraints that hinder or limit the knowledge exchange process include a lack of time insufficient internal capability to manage relationships and insufficient information to identify partners problems concerning cultural differences between academics and business and disputes concerning intellectual property are not prominent overall the paper suggests that the notion of an academic ivory tower seems to be a myth as far as the uk is concerned it also suggests that a strategic focus on strengthening connections between academia and the rest of society may generate long term benefits but it will also face challenges and should not distort or divert from the wider foundations of scholarship on which the success of universities are built

secure implementation in allotment economies an allocation rule is securely implementable if it is strategy proof and has no bad nash equilibrium in its associated direct revelation game saijo t sjostrom t yamato t 2007 secure implementation theoretical econ 2 203 229 original work published in rieti discussion paper 03 e 019 2003 we study this implementability notion in allotment economies with single peaked preferences sprumont y 1991 the division problem with single peaked preferences a characterization of the uniform allocation rule econometrica 59 509 519 the equal division rule and priority rules are characterized on the basis of secure implementability which underlines a strong trade off between efficiency and symmetry though the uniform rule is not securely implementable we show that in its direct revelation game any bad nash equilibrium is blocked by a credible coalitional deviation and any good nash equilibrium is never blocked thus the impossibility of securely implementing the uniform rule can be resolved by allowing pre play communication among players

innovation and university collaboration paradox and complexity within the knowledge economy the paper will explore the nature and impact of universities and other higher education institutions heis on firms innovation and growth in an increasingly distributed and open innovation system using a survey of some 400 firms in the uk the analysis reveals significant differences in firms collaboration with heis across the uk and the value and impact that such collaborations have on a firm s development the nature and effects of such collaboration vary significantly between the type of firm involved and their location and the analysis investigates this in relation to various aspects of innovative activity and firms performance much of the nature and effects of such collaboration are as one would expect counterintuitive and highlight the care we should place on assessing the role of universities and other heis in open innovation systems

nash equilibrium and welfare optimality if is a set of social alternatives a social choice rule scr assigns a subset of a to each potential profile of individuals preferences over a where the subset is interpreted as the set of welfare optima a game form or mechanism implements the social choice rule if for any potential profile of preferences 1 any welfare optimum can arise as a nash equilibrium of the game form implying in particular that a nash equilibrium exists and 2 all nash equilibria are welfare optimal the main result of this paper establishes that any scr that satisfies two properties monotonicity and no veto power can be implemented by a game form if there are three or more individuals the proof is constructive

universities technology and innovation centres and regional development the case of the north east of england the paper examines the role of technology and innovation centres tics in bridging the gap between the university research base and industry in order to foster economic development in a lagging industrial region the context is provided by an academic literature on the role of universities in regional innovation systems some of which casts doubt on the capacity of universities to operate in this domain particularly within a lagging region the empirical case reports on a bold experiment initiated by the regional development agency in the older industrial region of the north east of england to create and support new tics in the fields of process innovation in high value manufacturing and new and renewable energy and on the engagement of a regionally committed university with these centres the evidence presented suggests that while there are links between the university and the centres both are principally operating in a national science and technology system in which contributing to addressing uneven regional economic development is a secondary concern copyright the author 2012 published by oxford university press on behalf of the cambridge political economy society all rights reserved oxford university press

government policy university strategy and the academic entrepreneur the case of queensland s smart state institutes significant new university initiatives are usually analysed from the perspectives of government policy university strategy or the entrepreneurship of particular individuals but rarely from the view of their interdependencies this paper reports on the creation of four smart state institutes at the university of queensland in australia and the concatenation of circumstances decisions and actions that led to their formation in the course of just over a decade these institutes addressing biotechnology nanotechnology neuroscience and the molecular and cellular basis of disease have developed into a cluster of scientific research of global significance raising over 1 billion in investment and employing 1300 staff