co2 emissions of china s food industry an input output approach in a joint u s china statement on climate change the chinese government declared to peak co2 emissions around 2030 this demonstrates the government s determination to deal with carbon emission and climate change although the food industry is not a carbon emission intensive industry its large scale makes the emission reduction in the industry very important based on the input output structural decomposition method this paper calculates the co2 emissions of china s food industry from 1991 to 2012 and decomposes the change in co2 emissions of the industry during 1992 1997 1997 2002 2002 2007 and 2007 2010 into four main effects emission factor energy structure energy intensity and total output including four sub effects intermediate use domestic final demand import substitution and export extension the results show that changes in co2 emissions in the food industry mainly depends on total output effect and energy intensity effect energy intensity effect is the most important factor reducing co2 emissions as it reduced cumulative 213 million tons mt co2 emissions of the industry among total output effect the effects of intermediate use and domestic final demand are the two biggest contributors to carbon emissions finally we provide some policy advices for constraining and reducing co2 emissions of china s food industry the advices include increasing r d investment and the substitution of energy with other input factors to decrease energy intensity increasing the added value of the food industry optimizing the energy structure with more clean and low carbon energy and maintaining the prices of raw materials of the food industry i e agricultural products with taxes or subsidies

equity returns and integration is europe changing this paper analyses the consequences of the process of financial and economic integration on european equity markets it documents significant changes in fundamentals notably an increased synchronization of macroeconomic activities and a non negligible evolution in pricing with a decrease in the cost of capital and converging equity premiums as to equity returns themselves in the face of what could turn out to be long run upward trends in the correlations among both country and sector returns and a narrowing of the superiority of country factors the benefits to be gained from finding diversification opportunities at a more disaggregated level appear to be higher than ever copyright 2004 oxford university press

can capital scarcity help agency theory explain franchising revisiting the capital scarcity hypothesis we offer a rationale for a link between capital scarcity and franchising predictions respectively based on agency theory and the capital scarcity hypothesis were tested among 91 restaurant chains

forward exchange bias hedging and the gains from international diversification of investment portfolios abstract the gains to the us investor from international diversification of investment portfolios are examined for portfolio strategies that hedge and strategies that do not hedge exchange rate risk via the interbank forward market using the sharpe performance index and stochastic dominance as performance measures almost all the unhedged strategies outperformed the hedged strategies for 1985 1988 the opposite held for 1981 1984 the results are explained by the biasedness of forward rates in predicting future spot rates jel f30

energy demand and the composition of output growth abstract using the theory of the firm the effects of unbalanced rates of output growth on aggregate energy demand are examined theoretical results show that failure to consider unbalanced growth leads to bias in aggregate price elasticity estimates empirically differential output growth rates are important contributors to the overall growth of energy and other inputs they can be as important as net price effects in explaining input growth unbalanced growth effects help to explain changes in labor s productivity growth and have increased in importance since the arab oil embargo they are quite significant relative to other sources of change during business cycle downturns

trying to explain home bias in equities and consumption investors hold a substantially larger proportion of their wealth portfolios in domestic assets than standard portfolio theory would suggest a phenomenon called equity home bias in the absence of this bias investors would optimally diversify domestic output risk using foreign equities therefore consumption growth rates would tend to co move across countries even when output growth rates do not empirically however consumption growth rates tend to have a lower correlation across countries than do output growth rates a phenomenon i call consumption home bias in this paper i discuss these two biases and their potential relationship as suggested by the literature

control techniques and upward flow of information in franchising in distant markets conceptualization and preliminary evidence abstract information exchange between franchisees and franchisors is viewed as instrumental for the attainment of both firm specific and systemic goals within franchise systems our study investigates the issue of control and control techniques employed by franchisors to monitor the performance of their franchisees in distant markers with special focus on the role of information exchange a major assumption underlies our work even though in the language of agency theory franchise contracts attempt to align the incentives of the principal i e franchisor and the agent i e franchisee such alignment is not easy to achieve due to basic conflicts in the parties respective goals for instance while franchisees are primarily interested in achieving short term profits franchisors are more concerned about strengthening the brand equity of their systems a perfect upward flow of information i e from franchisees to franchisors therefore is not necessarily guaranteed this paper introduces and empirically evaluates four hypotheses relating franchisees willingness to provide information to their respective franchisors first it is suggested that franchisees willingness to provide information to their franchisors will be positively related to the incidence of repeat purchases since incentives to free ride are expected to be low at such units in repeat customer industries hence franchisees will have little incentive to hide information second it is argued that the greater the age of relationship between the focal franchisee and franchisor the more secure both parties are likely to feel about the projection of this relationship into the future consequently a positive relationship between the age of the franchise relationship and franchisees willingness to provide information to franchisors is proposed next we suggest that the level of competition faced by franchisees is positively related to franchisees willingness to provide information to their franchisors the latter effect is expected for two reasons foremost such franchisees are likely to see the availability of authentic market information as a necessary tool for their franchisors if franchisors are to provide them with accurate localized advice for combating competitive forces second from an agency theory perspective franchisees have an incentive to conceal information about the external environmental factors only if such information serves to explain franchisees business success in terms of forces other than their effort this would not occur in a competitive environment setting finally multi unit franchisees are hypothesized to more willingly provide information to their franchisors than their single unit counterparts given their lower incentives to free ride and the higher level of security felt in their relationships with their franchisors the empirical verification of our contentions was carried out in two stages first we studied in depth the case of lebanon to develop the initial descriptive materials second and based on the first step we surveyed u s based franchisors with franchisees in the middle east and africa to assess our hypotheses results show that while the extent of competition faced by franchisees was found to be an incentive to provide information to franchisors the age of the relationship emerged as a disincentive to sharing information with the franchisors

the multi factor energy input output model abstract energy input output analysis eio analysis is a noteworthy tool for the analysis of the role of energy in the economy however it has relied on models that provide a limited description of energy flows in the economic system and do not allow an adequate analysis of energy efficiency this paper introduces a novel energy input output model the multi factor energy input output model mf eio model which is obtained from a partitioning of a hybrid unit input output system of the economy this model improves on current models by describing the energy flows according to the processes of energy conversion and the levels of energy use in the economy it characterizes the vector of total energy output as a function of seven factors two energy efficiency indicators two characteristics of end use energy consumption and three economic features of the rest of the economy moreover it is consistent with the standard model for eio analysis i e the hybrid unit model this paper also introduces an approximate version of the mf eio model which is equivalent to the former under equal energy prices for industries and final consumers but requires less data processing the latter is composed by two linked models a model of the energy sector in physical units and a model of the rest of the economy in monetary units in conclusion the proposed modelling framework improves eio analysis and extends eio applications to the accounting for energy efficiency of the economy

on the causal dynamics between emissions nuclear energy renewable energy and economic growth this paper examines the causal relationship between co2 emissions nuclear energy consumption renewable energy consumption and economic growth for a group of 19 developed and developing countries for the period 1984 2007 using a panel error correction model the long run estimates indicate that there is a statistically significant negative association between nuclear energy consumption and emissions but a statistically significant positive relationship between emissions and renewable energy consumption the results from the panel granger causality tests suggest that in the short run nuclear energy consumption plays an important role in reducing co2 emissions whereas renewable energy consumption does not contribute to reductions in emissions this may be due to the lack of adequate storage technology to overcome intermittent supply problems as a result electricity producers have to rely on emission generating energy sources to meet peak load demand

energy embodied in the international trade of china an energy input output analysis abstract growing international trade has not only positively affected the people s republic of china s china s economic development but also expanded the exportation of energy embodied in goods during their production this energy flow out will pose risks to china s rational utilization of natural resources as well as environmental protection in this paper we evaluate the energy embodied in goods produced in china during 1992 2005 and use input output structural decomposition analysis to identify five key factors causing the changes of energy embodied in exports direct primary energy efficiency primary energy consumption structure structure of intermediate inputs structure of exports and scale of exports for the three sub periods of 1992 1997 1997 2002 and 2002 2005 results show that china is a net exporter of energy and the energy embodied in exports tends to increase over time the expanding total volume of exports and increasing exports of energy intensive goods tend to enlarge the energy embodied in exports within all three sub periods but these driving forces were offset by a considerable improvement of energy efficiency and changes in primary energy consumption structure from 1992 to 2002 and the effects of structure of intermediate input only in the sub period from 1992 to 1997 from 2002 to 2005 the sharp augmentation of energy embodied in exports was driven by all the five factors our research has practical implications for the chinese economy results of this study suggest that the energy embodied in trade should receive special attentions in energy policies design to limit the energy resource out flow and pollution generation

shared producer and consumer responsibility theory and practice abstract over the past decade an increasing number of authors have been examining the nexus of producer versus consumer responsibility often dealing with the question of how to assign responsibility for internationally traded greenhouse gas emissions recently a similar problem has appeared in drafting the standards for the ecological footprint while the method traditionally assumes a full life cycle perspective with full consumer responsibility a large number of producers businesses and industry sectors have started to calculate their own footprints see www isa org usyd edu au adding any producer s footprint to other producers footprints or to population footprints which all already cover the full upstream supply chain of their operating inputs leads to double counting the sum of footprints of producers and consumers is larger than the total national footprint the committee in charge of the footprint standardisation process was hence faced with the decades old non additivity problem posing the following dilemma for the accounting of footprints or any other production factor if one disallows double counting but wishes to be able to account for producers and consumers then one cannot impose the requirement of full life cycle coverage the supply chains of actors have to be curtailed somehow in order to avoid double counting this work demonstrates and discusses a non arbitrary method of consistently delineating these supply chains into mutually exclusive and collectively exhaustive portions of responsibility to be shared by all actors in an economy

social cost of environmental quality regulations a general equilibrium analysis the use of cost benefit analysis by federal regulatory agencies has expanded greatly in scope and sophistication unfortunately agencies continue to employ private cost rather than social cost to evaluate environmental quality regulations furthermore general equilibrium impacts and intertemporal effects of regulations are typically not included in the evaluation in this paper we estimate the social cost of environmental quality regulations mandated by the clean air and clean water acts we construct an econometric general equilibrium model of the united states to demonstrate that social cost estimates diverge sharply from private cost estimates we also demonstrate that general equilibrium impacts are significant and pervasive and that intertemporal effects of the regulations heretofore ignored are significant

a physical view of sustainability abstract we assume that natural ecological communities tend to maximize the amount of stored biomass on a given area thereby creating the highest sustainable rate of entropy formation possible from that area we take this climax condition to define sustainability human intervention through agriculture reduced the ecosystem in given areas to a juvenile state a state which seems to produce entropy at a lower rate than that of the natural climax condition the gap in entropy production rates between the natural and the agricultural system would eventually be overcome by the direct and indirect use of fossil fuels these fossil fuels are consumed much faster than they are being formed and therefore a social structure based on their extensive use cannot be sustainable what type of social structure does meet our definition of sustainability that is what style and size of social activity will generate entropy at a rate no greater than that of the climax ecosystem in a particular area during the last two decades studies of economic activities and their environmental repercussions were limited to the possible costs and benefits of pollution control and to the economically optimal extraction rates of mineral resources the intrusion of human activities into the environment became increasingly apparent through the depletion of natural resource stocks and decreasing environmental quality in the 1990s sustainability of the socio economic system within the global ecosystem has become the pressing issue although research is increasingly concerned with the question of sustainability a definition based on physically measurable evidence is missing such a definition is proposed in this paper and an example application is given for a particular area

investments to create bargaining power the case of franchising hybrid organizational forms such as franchise systems join two or more independent parties under a contract the ability of each party to achieve its goals depend upon the relative bargaining power in the relationship established by the contract using transaction cost economics and porter s 1980 characterization of sources of bargaining power this paper argues that the franchisor can make investments in activities such as tapered integration and buyer selection to increase its bargaining power and decrease conflict and litigation in a franchise system specifically tapered integration owning some units while franchising others selecting inexperienced franchisees and employing a long training program are predicted to increase the franchisor s bargaining power and the franchisee s compliance with franchisor standards an empirical analysis of litigation in restaurant franchise systems supports the theoretical hypotheses copyright 2000 john wiley sons ltd

contribution of demand shifts to industrial so 2 emissions in a transition economy evidence from china abstract for the past 20 years sulfur dioxide so2 emissions control has been a goal in china whose economy has been characterized as fast growing and in enormous transition as a prerequisite for effective future so2 emissions control a detailed investigation is needed to uncover and assess the contributions to changes in so2 emissions of key underlying drivers associated with china s evolving demand structure using structural decomposition analysis sda considering industrial characteristics and sector interactions this study identifies the underlying drivers behind china s demand structure shifts as well as their contributions to changes in industrial so2 emissions the results show that the change in total final demand was the largest driver of the increase in so2 emissions resulting in an increase of 36 64 million tons mt so2 emissions during the time period 1997 to 2012 from the final demand perspective the change in capital formation was the largest contributor resulting in an increase of 16 78 mt so2 emissions and accounting for 45 of the increase due to final demand shifts the construction industry was the primary trigger of industrial so2 emissions growth caused by shifts in final demand with an induced amount impact on other industries of so2 emissions of 10 14 mt the key drivers capturing shifts in final demand were mainly capital formation in the construction industry capital formation and exports in technology intensive industries and consumption in the services industries the recommendation is that to control industrial so2 emissions china should depend first on its economic transition that includes technology improvements and industry structure optimization for both final demand and production

portfolio performance and the euro prospects for new potential emu members abstract entering the emu removes currency risk for assets originating in the euro area while diversification opportunities are likely reduced taking the perspective of an investor in one of the 12 countries that joined the eu in 2004 2007 we contrast actual optimal composition of international equity holdings against two artificial scenarios costless hedging against exchange rate risk and presuming the local market to be part of the emu state specific optimal portfolios are determined from realized covariances for the period 2000 2006 optimized risk is found smaller under currency unification and implied sharp ratios signal significant benefits of emu participation

the role of consumption patterns demand and technological factors on the recent evolution of co2 emissions in a group of advanced economies changes in production structures and modifications of patterns of consumption are key factors in the fight against environmental harm initiatives such as agenda 21 promoted by the un highlight the need to evaluate the relationships among factors of production and consumption innovation and demographics and the environment in the attainment of sustainable development in this context our work studies in depth those factors underlying the economic activity of households in a representative group of european union countries and the us within the framework of an input output model a structural decomposition analysis is considered in order to identify the weight that growth in demand changes in patterns of consumption changes in the distribution of income the substitution of inputs and changes in energy intensity have all had on the evolution of co2 emissions the work specifically seeks to identify common patterns and differential behaviors among productive sectors in the european social environment the results show that growth in demand and therefore in production largely absorbs the limited effect of technological and efficiency improvements and the incipient changes observed in consumption patterns

a structural decomposition analysis of the emissions embodied in trade abstract the aim of this study is to quantify the driving forces behind the growth of carbon dioxide emissions embodied in trade eet the world input output database is used to estimate eet in 40 countries during 1995 2007 after which a structural decomposition analysis is applied to avoid biases in the results we have used the input output tables in previous year s prices and chained the outcomes in many developed countries the growth of emissions embodied in imports is much higher than the growth of emissions embodied in exports a key reason for this finding is the change in the structure of trade both in intermediate and in final products emerging economies like the bric countries have increased their share in production and trade at the expense of developed countries producers and consumers in developed countries have shifted towards importing a larger share of products from emerging countries this is the distinguishing feature that led to an increase of emissions embodied in imports for developed countries and an increase of emissions embodied in exports for emerging countries these results suggest policy makers to monitor eet more carefully and take the effects of trade on emissions into consideration

agency theory and franchising some empirical results this article provides an empirical assessment of various agency theoretic explanations for franchising including risk sharing one sided moral hazard and two sided moral hazard the empirical models use proxies for factors such as risk moral hazard and franchisors need for capital to explain both franchisors decisions about the terms of their contracts royalty rates and up front franchise fees and the extent to which they use franchising in this article i exploit several new sources of data on franchising to construct a cross section of 548 franchisors involved in various business activities in the united states in 1986 the data are most consistent with a model based on two sided moral hazard the empirical models are also more successful at explaining the extent to which franchisors choose to franchise stores than at explaining the terms of franchise contracts finally contrary to the predictions of several theoretical models i find that royalty rates and franchise fees are not negatively related

a structure decomposition analysis of china s production source co2 emission 1992 2002 this paper provides an empirical analysis of the relative impacts of various factors on co2 emissions from production of goods and services in china during two consecutive periods of 1992 1997 and 1997 2002 results show that on the positive side level of final demand for goods and services was the main reason for the increase of production source co2 emission while structure of net export has similar positive effect during the first period of 1992 1997 on the negative side technology factors remains as the main factors reducing emissions the level of net export played some role in the first period but the effects were seen in the second period from energy intensity fuel mix and input mix the results suggest that economic structure be focused as an important factor for co2 emission reduction with construction and transport as two key industries to lower carbon emission

aggregation in variance of shared responsibility a case study of australia abstract this article deals with shared producer and consumer responsibility a concept aimed at overcoming the non additivity or double counting problem in corporate and national sustainability reporting it reports on the potentially distorting effects that varying sector and business classifications could have on the apportioning of emissions or other sustainability measures amongst producers and consumers in an economy a quantitative in variance analysis is provided which shows that shared responsibility formulations are remarkably stable under extreme aggregation of the underlying input output data value added pegging of the sharing parameters generally reduces variance in comparison to constant sharing parameters these results help in substantiating the robustness of the shared responsibility concept a feature which is critically important if shared responsibility were to become corporate and national reporting practice

costs of control the source of economic rents for mcdonald s franchisees the main purpose of this article is to establish empirically using financial data that there are both ex ante and ex post rents left downstream at mcdonald s we find that the present value of the ex ante rents is around 300k 455k 1982 dollars ex post rents are of course even larger we argue that the ex post rents represent an incentive mechanism that complements the use of profit sharing rights at mcdonald s we also argue that ex ante rents arise here because franchisees wealth constraints prevent the up front extraction of the full present value of the ex post rents finally we note that mcdonald s desire for a particular type of individual to operate its franchises namely owner operators whose livelihoods are tied to the success of their outlets increases the likelihood that downstream operators face liquidity constraints this in turn contributes to the need for mcdonald s to leave ex ante rents downstream

comparing structural decomposition analysis and index to analyze and understand historical changes in economic environmental employment or other socio economic indicators it is useful to assess the driving forces or determinants that underlie these changes two techniques for decomposing indicator changes at the sector level are structural decomposition analysis sda and index decomposition analysis ida for example sda and ida have been used to analyze changes in indicators such as energy use co2 emissions labor demand and value added the changes in these variables are decomposed into determinants such as technological demand and structural effects sda uses information from input output tables while ida uses aggregate data at the sector level the two methods have developed quite independently which has resulted in each method being characterized by specific unique techniques and approaches this paper has three aims first the similarities and differences between the two approaches are summarized second the possibility of transferring specific techniques and indices is explored finally a numerical example is used to illustrate differences between the two approaches

coupling model of energy consumption with changes in environmental utility abstract this study explores the relationships between metropolis energy consumption and environmental utility changes by a proposed environmental utility of energy consumption euec model based on the dynamic equilibrium of input output economics theory it considers three simulation scenarios fixed technology technological innovation and green building effect it is applied to analyse hong kong in 1980 2007 continual increase in energy consumption with rapid economic growth degraded environmental utility first energy consumption at fixed technology was determined by economic outcome in 1990 it reached a critical balanced state when energy consumption was 22 109 kwh before 1990 x1 22 109 kwh expansion of energy consumption facilitated socio economic development but suppressed environmental benefits second technological innovation strongly influenced energy demand and improved environmental benefits the balanced state remained in 1999 when energy consumption reached 32 33 109 kwh technological innovation dampened energy consumption by 12 99 exceeding the fixed technology condition finally green buildings reduced energy consumption by an average of 17 5 in 1990 2007 they contributed significantly to energy saving and buffered temperature fluctuations between external and internal environment the case investigations verified the efficiency of the euec model which can effectively evaluate the interplay of energy consumption and environmental quality

technological gap scale economy and china s industrial energy demand abstract the industrial sector in china is energy intensive and accounts for more than 60 of the nation s total energy consumption demand narrating the story behind the growth of china s industrial energy consumption could help us understand the past and prepare for the future this paper aims to investigate the factors affecting china s industrial energy consumption in the 21st century by using an extended production theoretical decomposition approach pda with considering the technological gap and scale of the economy effects the new proposed decomposition framework includes four new factors namely the energy technological gap the output technological gap energy scale efficiency and output scale efficiency the results show that in the 21st century the energy consumption of china s industry increased by more than one billion tons of standard coal the expansion of the industrial economy is a dominant driver of china s industrial energy consumption while potential energy intensity energy technology and output technology are the three largest energy saving factors in addition to the conventional factors the newly proposed factors also have important effects on china s industrial energy consumption specifically output scale efficiency is an energy saving factor while the energy technological gap output technological gap and energy scale efficiency are drivers of energy consumption this suggests that china s industry is at the stage of returns to scale that is beneficial to output performance but harmful to energy performance meanwhile the widening of the industrial technological gaps has negative impacts on china s industrial energy conservation the proposed decomposition approach can provide information that cannot be obtained from traditional approaches and it can also be applied to many other cases for investigating feasible paths of energy saving and emissions reduction

survival patterns among newcomers to franchising abstract this study examines survival patterns among franchisee and nonfranchise small firms and establishments that entered business during 1986 and 1987 aspiring entrepreneurs purchasing franchises choose this path to small business entry in part because they expect to improve their chances of survival during the turbulent early years of operation evidence to date has been mixed some studies conclude that franchising is a low risk route to small business ownership while others suggest that independent start ups are more likely to remain in operation than franchises this study utilizes two distinct methodological approaches to investigate franchisee survival patterns the first approach demonstrates that franchise units have better survival prospects than independents and the second approach demonstrates that young firms formed without the benefit of a franchisor parent are more likely to remain in operation than franchised start ups reconciliation of these seemingly inconsistent findings is explored survival measurement is heavily influenced by the unit of analysis in franchising firm specific data show different patterns than establishment specific data when young franchise units are tracked through time analysis of establishments owned by corporations is undertaken for restaurants opened nationwide in 1986 and 1987 using census bureau data describing corporate owned restaurant establishments that reported payroll to the irs in 1987 52 088 young establishments were identified 22 5 were franchises comparison of the franchisee and independent restaurant units indicated that independents were more likely to cease operations by 1988 than franchises the fact that franchisee establishments had a better survival track record than independent restaurants does not however demonstrate that aspiring entrepreneurs improve their survival prospects by purchasing a franchise in fact 84 of the new franchise establishments under consideration were units of multi establishment corporations and few of these corporate parents were new businesses envision a corporation in operation for 15 years that owns 20 mcdonalds restaurants in 1987 they opened their twenty first unit the findings of this study indicate that this twenty first unit has excellent survival prospects more so than either an independent start up or a franchisee opening a restaurant for the first time new franchised restaurant units overall may be a safe investment although simultaneously the newcomer opening a franchise may face a high risk situation the analysis then shifts from establishments owned by franchisees to young firms not establishments started in 1986 and 1987 as proprietorships partnerships or s corporations among these young firms franchisees are found to have lower survival rates than independent start ups and these differences persist when various firm and owner traits are controlled for statistically retailing is found to be a particularly difficult field for young franchised firms risk of firm closure is high and mean profits are negative the most common route into retailing entailed purchasing an operating franchise unit from its previous owner that is an ongoing franchise over 53 of the young franchised retailing firms started in 1986 and 1987 were ongoing operations by 1991 only 52 4 of these firms were still operating with the owner of record present in 1987 the findings of this study indicate on balance that purchase of a franchise is unlikely to reduce the risks facing a new business start up this does not imply that the multi establishment franchisee adding another new franchise unit to its existing chain of operations faces a high risk situation rather the high risk facing the franchisee newcomer is partially rooted in the fact that so many of the newly opened units in mature franchising niches are owned by multi unit franchisees that have greater experience and resources than newcomers who are attempting to enter the industry

the effect of organizational form on quality the case of franchising abstract the organizational form of franchising has been shown to yield higher profits and faster growth through reducing agency costs why then does anyone not franchise in this paper i argue that the diffuse residual claims of the franchise system reduce overall system quality and that this problem is inherent in the nature of franchising the theory is tested by examining evidence from both the restaurant and the hotel industries including chains that franchise and ones that own all of their units in both industries quality is negatively related to the percent franchising in the chain controlling for size growth in units monitoring costs market segment ownership structure multi chain operation and price the results suggest that the franchise contract increases free riding and decreases quality in decentralized service chains and that quality is not contractible in this setting

using composition of land multiplier to estimate ecological footprints associated with production activity abstract ecological footprint ef a measure of sustainability represents the areas of land and water required to produce the goods and services for satisfying the consumption of a defined human population or economy and to provide environmental assimilation capacity for keeping its environmental quality at a given level production land footprint a main component of the ef represents the lands used by production sectors for producing the goods and services for the final consumption of a given human population there have been at least two alternatives in estimating the production land footprint one is based on the estimates of apparent consumption of each type of resource along the line of the methodology proposed by wackernagel and rees wackernagel m rees w e 1996 and its later refinement the other suggested by bicknell et al 1998 is based on the monetary values of products that are delivered to domestic final demand the information recorded in an input output table the former faces the challenge of distinguishing the commodities used as intermediate input from those as final consumption although its recent development has tried to calculate the raw materials used directly in traded manufactured products wackernagel m lewan l hansson c b 1999a it is not an easy job because the indirect input requirements are also involved using input output analysis which has been widely used to consider the direct and indirect input requirements of supporting final demand may alleviate this difficulty bicknell et al 1998 adopted input output analysis to estimate the footprint of new zealand in their calculation they used land multipliers to obtain the production land areas required to produce the outputs for domestic final consumption directly and indirectly and presented the estimates under three land categories agricultural land forest land and degraded land however this presentation causes errors in the concept and calculation this is because that the area requirement of sector j s production land is obtained by multiplying sector j s land multiplier with its output for domestic final consumption the result would contain not only sector j s own production land but also those of other sectors whose outputs sector j uses as inputs thus the ensuing estimates on sectoral production lands cannot be presented by land category using the hypothetical data in the article of bicknell et al 1998 this paper explains the reasons for using the composition of land multipliers instead of land multipliers in estimating the production land footprint so that the calculated areas can be expressed by land category the revised calculation is then applied to taiwan for estimating her two footprint components production land and energy land in 1991

embedding the drivers of emission efficiency at regional level analyses of namea data abstract this paper provides new empirical evidence on regional national disparities in environmental efficiency based on analyses of namea data referring to italy and the lazio region where rome is the main city shift share analyses provide evidence on the drivers of environmental efficiency and on sector specificity our evidence shows that although the region around rome has achieved higher environmental performance compared to italy mainly thank to its being less industry based some critical points in the energy sector and in some services should be taken into account in shaping the future development of the region in addition the use of regional namea for econometric investigations of emission efficiency drivers at national level shows that though north south disparities favour northern and richer regions in accordance with development oriented dynamics environmental hot spots driven by specialisation and efficiency related issues also appear in some northern industrial regions further the role of public ad private r d is of main relevance in enhancing emission on economic value ratios environmental industrial and sector oriented policy making may derive valuable information from the evidence provided by our study that highlights how analytical exploitation of namea offers rich array of insights for regional policy making

improving channel coordination through franchising in this paper we explore the role of franchising arrangements in improving coordination between channel members in particular we focus on two elements of the franchising contract namely the royalty structure and the monitoring technology we begin with a simple analysis where a manufacturer distributes its product through a retailer and the retail demand is affected by the retail price and the service provided by the retailer in this context we show that neither royalty payments nor monitoring are needed for full coordination we then extend the model to allow for free riding by franchisees and show that although monitoring helps affect the behavior of the franchisees royalty payments are still unnecessary to coordinate the activities of the franchisor and the franchisees finally we show that in environments where factors affecting retail sales are controlled by both the franchisor and the franchisee royalty payments provide the necessary incentives for the franchisor while monitoring systems are used to ensure that franchisees also behave in the best interest of the channel our general results are found to be consistent with those in brickley and dark 1987 and norton 1988 who conclude that franchising is affected by principal agent problems our theory finds special support in the work of lafontaine 1988 where it is concluded that the incidence of franchising is related to cost of monitoring and the importance of franchisor investments

identifying critical supply chain paths that drive changes in co2 emissions abstract to address the problem of global warming it is important to identify the supply chain paths that drive changes in life cycle co2 emissions and provide both policy makers and decision makers with the information on the critical paths in order to efficiently reduce the co2 emissions in this article i extract and analyze the factors and key supply chains involved in changes in co2 emissions associated with japan s overall demand from 1990 to 2000 using the structural path decomposition spd method applied to the 1990 1995 2000 linked japanese environmental input output tables at the four digit commodity classification level the results reveal that the volume of co2 emissions increased as a result of changes in the input structure of the electricity of the services sector such as electricity amusement and recreation facilities household demand electricity retail trade household demand and electricity public administration local local government demand indicating increasing dependence of services on energy input i also find that the final demand shift changed co2 emissions for example the rise in demand for integrated circuits in exports has contributed to increasing co2 emissions generated from electricity the fall in demand for frozen fish and shellfish in household demand has contributed to decreasing co2 emissions from marine fisheries

material implication of chile s economic growth combining material flow accounting mfa and structural decomposition analysis sda abstract over the last three decades the economic integration of the chilean economy into global markets has been taking place at a rapid pace for example in 1986 exports represented 29 of gdp while in 1996 they had increased to 38 of gdp this period of time was characterized by strong economic growth with an average annual growth rate of about 10 from a physical perspective material requirements more than doubled from 220 to 500 million tons of direct material inputs dmi during the same decade the rate of material growth requirements was around 13 per year the main objective of this study is to explain the changes in dmi by using a structural decomposition analysis sda the changes in material flow accounting mfa were broken down into the effects caused by changes in resource use per unit of output material intensity effect changes between and within sectors structural change effect changes in the composition of final demand mix effect changes due to shifting shares of domestic final demand and export categories category effect and finally changes in the overall level of economic activities level effects the results as a percentage of the total level of dmi used in 1986 indicate that economic growth was the major source of material changes 109 the material intensity and category effects explained 31 and 14 of the increase respectively the increase in the material intensity is mainly due to a declining quality of ores in copper production however these components were partly compensated by the structure 14 and mix 13 effects therefore for a southern american country such as chile the main causes of these changes in material consumption have been a combination of the nature of economic growth along with an increase in export production and material intensity of production

readjustment potentials in industrial energy efficiency and structure abstract with the availability of input output data for 1977 it is possible to analyze the short run effects of the 1974 energy price increase as well as other factors on the energy efficiency of the industries of the economy such an analysis is conducted here using a number of measures derived through the energy input output model attention is focused on patterns of energy use changes in energy intensities through time and the factors which underlie these changes a specific measure of the degree to which energy substitution is attributable to changes in direct and indirect energy requirements is developed and estimated results show that large changes in the economy s overall industrial energy requirements are not observed between 1963 and 1977 however for individual fuels large changes in intensity values are not at all uncommon among industries

exchange rate uncertainty forward contracts and international portfolio selection in this paper ex ante efficient portfolio selection strategies are developed to realize potential gains from international diversification under flexible exchange rates it is shown that exchange rate uncertainty is a largely nondiversiflable factor adversely affecting the performance of international portfolios therefore it is essential to effectively control exchange rate volatility for that purpose two methods of exchange risk reduction are simultaneously employed multicurrency diversification and hedging via forward exchange contracts the empirical findings show that international portfolio selection strategies designed to control both estimation and exchange risks almost consistently outperform the u s domestic portfolio in out of sample periods since grubel 11 applied modern portfolio theory mpt to international investment various authors such as levy and sarnat 17 solnik 20 and lessard 16 have examined the gains from international diversification of investment portfolios for the purpose of establishing the gains from international diversification these studies constructed international portfolios using historical risk and return data from a period of fixed or relatively stable exchange rates and showed that internationally diversified portfolios dominated purely domestic portfolios in terms of mean variance efficiency from the standpoint of today s investors however the previous studies fail to offer operational guidance for international diversification for two important reasons first it is now questionable whether the past findings are still relevant under the current flexible exchange rate regime second by being ex post in nature the past studies ignored the issue of estimation risk or parameter uncertainty and therefore may have overstated the realizable portion of the potential gains from international diversification fluctuating exchange rates are likely to mitigate the potential gains from international diversification by making investment in foreign securities more risky as will be shown later a fluctuating exchange rate contributes to the risk of foreign investment not only through its own variance but also through its positive covariances with the local stock market returns during our sample period of 1980 through 1985 for example exchange rate volatility is found to account for about fifty percent of the volatility of dollar returns from investment in the stock markets of such major countries as germany japan and the u k furthermore the exchange rate changes vis a vis the u s dollar are found to be

incentive conflicts and contractual restraints evidence from franchising abstract this study uses agency theory to develop testable implications about three provisions commonly observed in franchise contracts 1 restrictions on passive ownership 2 area development plans and 3 mandatory advertising expenditures the primary hypothesis is that these provisions are most likely when there are significant externalities among the units within the franchise system the evidence based on a large sample of franchise contracts is generally consistent with this hypothesis the evidence also suggests that these incentive instruments are complements in contrast to the theory most of the results do not support the hypothesis that the percentage of company owned units is related to externalities within the system franchisee risk aversion and or wealth constraints appear more important while the study focuses on franchising the results provide insights into related provisions in other contracts

yield spreads on emu government bonds government bond spreads we provide evidence that the movements in yield differentials between euro zone government bonds explained by changes in international risk factors as measured by banking and corporate risk premiums in the united states are more pronounced for bonds issued by italy and spain liquidity factors play a smaller role so policies meant to increase financial market efficiency do not appear sufficient to deliver a seamless bond market in the euro area the risk of default is a small but important component of yield differentials movements which signal market perceptions of fiscal vulnerability impose market discipline on national fiscal policies and may be reduced only by further convergence in debt ratios lorenzo codogno carlo favero and alessandro missale

economic drivers of greenhouse gas emissions in china abstract for china greenhouse gas emissions increased by 0 075 gigatons gt in the period of 1995 2000 and increased by 4 23 gt from 2000 to 2009 then reached the amount of 8 61 gt in 2009 different from the traditional analysis focused on accounting sectors greenhouse gas emissions under the production based responsibility this paper investigates sectoral ghg emissions in china in the period of 1995 2009 from the perspective of consumption based and income based responsibility we found that different metrics yield very different ghg emission responsibilities the sector of electricity gas and water supply has the highest ghg emissions responsibility based on the production and income metrics while the sector of construction is the largest emitter under the consumption metric in the light of the key driver analysis of ghg emissions from 1995 to 2009 based on the consumption metric the change in the final demand volume is the largest driver of increase in china s consumption based ghg emissions 17 18 gt the changes in the production structure and the final demand structure are other contributors 0 53 gt 1 46 gt the improvement to the intensity of ghg emissions is the main force for ghg emissions mitigation 14 86 gt according to the income metric the contributions of input volume changes input structure changes and ghg intensity changes are similar to the effects of consumption based responsibility 19 11 gt 1 13 gt 14 95 gt the difference is that the change in the production structure is another force that offset ghg increase 0 98 gt results in this paper can give some recommendation on mitigating ghg emissions in china for policy makers from production side demand side and supply side

causality between income and emission a country group specific econometric analysis abstract empirical studies of the environmental kuznets curve ekc examine the presence or otherwise of an inverted u shaped relationship between the level of pollution and the level of income customarily in the diagram of ekc the level of income is shown on the horizontal axis and that of pollution on the vertical axis thus it is presumed that the relationship between income and pollution is one of unidirectional causality with income causing environmental changes and not vice versa the validity of this presumption is now being questioned it is being asserted that the nature and direction of causality may vary from one country to the other in this paper we present the results of a study of income co 2 emission causality based on a granger causality test to cross country panel data on per capita income and the corresponding per capita co 2 emission data briefly our results indicate three different types of causality relationship holding for different country groups for the developed country groups of north america and western europe and also for eastern europe the causality is found to run from emission to income for the country groups of central and south america oceania and japan causality from income to emission is obtained finally for the country groups of asia and africa the causality is found to be bi directional the regression equations estimated as part of the granger causality test further suggest that for the country groups of north america and western europe the growth rate of emission has become stationary around a zero mean and a shock in the growth rate of emission tends to generate a corresponding shock in the growth rate of income in contrast for the country groups of central and south america oceania and japan a shock in the income growth rate is likely to result in a corresponding shock in the growth rate of emission finally causality being bi directional for the country groups of asia and africa the income and the emission growth rates seemed to reinforce each other

can portfolio rebalancing explain the dynamics of equity returns equity flows and exchange rates we explore whether the pattern of international equity returns equity portfolio flows and exchange rate returns are consistent with the hypothesis that unhedged global investors rebalance their portfolio in order to limit their exchange rate exposure when there are 1 relative equity return and 2 exchange rate shocks we also explore whether 3 equity flow shocks influence the exchange rates and relative equity prices in the estimation of the var system we do not impose any causal ordering upon the primitive shocks but instead identify the system based on theoretical priors about the contemporaneous conditional correlations between the three variables international data for the five largest equity markets are consistent with a theory in which equity returns and portfolio rebalancing are an important source of exchange rate dynamics

marginal abatement costs of co2 emission reductions geographical flexibility and concrete ceilings an assessment using the poles model abstract the kyoto protocol envisage the setting up of flexibility mechanisms allowing annex b countries to fulfil their commitments to reducing greenhouse gases with respect for the principle of economic efficiency the current negotiations relate in particular to the possibility of setting up a system of tradable emissions permits for annex b countries and also of introducing ceilings to trade this paper analyses the stakes and economic potential of adopting this instrument both for those countries that made commitments in kyoto and for developing countries it is based on a formal approach that allows for a consistent framework of analysis the emission permit market is in fact simulated on the basis of a reference scenario and of marginal abatement cost curves and estimated by the poles model after analysing these marginal abatement cost curves and comparing them with those produced by other models we explore two different configurations for a competitive market a market limited to the annex b countries and a world market the results produced by the model show that widening the market to include developing countries is more effective than the annex b market solution it reduces the cost of implementing kyoto for oecd countries and at the same time allows the countries of the south to benefit from selling the permits this research also shows that introducing restrictions on exchanges for annex b countries could have a counter productive redistribution effect with the ethical argument that underlies that particular measure

regional and sectoral attribution to percentage changes in the european divisia carbonization index abstract concerns on rising concentrations of co2 in the atmosphere and global warming have increased in recent years numerous environmental studies analyze the trends in co2 emissions and their main drivers in this paper we focus on the dynamics of the carbonization effect as a driving force for co2 emissions in the european union eu by implementing the sato vartia logarithmic mean divisia index method the trend of european emissions in the 2000 2010 period is factorized by both sector and country the analysis stresses the relevance of the carbonization and intensity effects in order to reduce emissions then based on so called attribution analysis we present a new theoretical framework that enables the attribution of both economic sector and individual eu member state to percentage changes in the carbonization index results show strong concentration of this reducing influence in some big economies in fact germany the united kingdom france and italy have contributed by more than 50 industry emerges as the most influential sector contributing to offset any improvement in the carbonization index our findings suggest strategies aiming at encouraging innovation technical change research on higher quality energies fuel substitution and installation of abatement technologies particularly in the industrial sector of large economies

multi unit franchising growth and management issues abstract entrepreneurs in a number of retailing sectors have eschewed the creation of company owned chains and have embraced franchising as a preferred method for growing their businesses there have been two leading reasons proposed for this preference first that franchisees provide the financial capital necessary for expansion and second that franchisees manage the outlets better than company employees would if the unit were company owned interestingly although many entrepreneur franchisors confirm the relevance of the capital acquisition argument in their decision making theoretical analysis has discounted its importance instead researchers have focused on the incentives of employee store managers to misrepresent their ability and their effort as the dominant impetus behind franchising misrepresentation by employees as to ability and effort imposes costs and inefficiencies on the entrepreneur s chain arguing that franchising solves these problems by having the stores managed by persons with claims to the profits these researchers have by and large rejected the capital acquisition argument for franchising in favor of this incentive based rationale within this view multi unit franchising presents a curious anomaly multi unit franchising either through the incremental expansion by the franchisee one unit at a time or through the rights to open multiple units contained in an area development agreement creates a collection of mini chains within the franchise system these mini chains are operated by employee store managers of course they are employees of the franchisee but they are employees nonetheless and as franchise researchers have traditionally argued regarding the entrepreneur s employees they will have incentives to misrepresent their ability and effort moreover multi unit franchising is ubiquitous if multi unit franchising is at odds with the incentive rationale for franchising and it has a positive association with the growth of franchise systems it must be providing the entrepreneur with some other benefit in this study we argue that the benefit it provides is access to capital through a study of fast food franchise systems we demonstrate that the more a chain engages in multi unit franchising i e the greater the proportion of multi unit franchisees it has the faster it grows even faster than franchise systems generally moreover we show that the level of commitment franchisors feel toward continuing to franchise is negatively related to the average number of units per franchisee and negatively related to their ability to obtain financial capital elsewhere in other words although multi unit franchising helps an entrepreneur grow his or her business by providing increased access to capital store level incentive problems get increasingly troublesome as franchisees get more and more units it would appear therefore that capital acquisition is a relevant reason for engaging in franchising after all

the effect of organizational context on entrepreneurial strategies in franchising abstract franchising systems play a vital role in the creation of new jobs and economic development although the role of the franchisor as entrepreneur is generally assumed there has been limited research on the conduct of entrepreneurial activities in the franchising system as a whole in particular researchers and practitioners need to better understand the influences of organizational context on entrepreneurial activities system wide the research reported in this article examines the influences of the organizational context of the franchisor on the entrepreneurial strategies of franchisors their innovation efforts and franchisor support of entrepreneurial activities by franchisees specifically this study examines how the organizational context variables of size age of the franchise its growth rate both absolute and relative and time in franchising affect franchisee perceptions of entrepreneurial strategies of their parent franchisor their innovation efforts and franchisor managerial support for entrepreneurial activity and innovation by the franchisee franchisee perceptions of their parent franchisors entrepreneurial strategies were assessed with respect to four dimensions identified in previous research as central to an entrepreneurial orientation low concern for stability willingness to take risks aggressiveness in competition and proactiveness in seeking new opportunities innovation by franchisors was measured with respect to introduction of new products and techniques drawing on research that emphasizes the importance of instituting special organizational devices and rewards and recognition systems for promoting entrepreneurial activity franchisor support for franchisee entrepreneurial activity and innovation e g the development of new products and services new techniques to improve customer service was measured by the importance franchisees assigned to the use of a franchise council the recognition of new ideas at the annual meeting of the franchise system and the presence at franchisor headquarters of a champion for innovation consistent with other studies examining the influence of organizational context it was hypothesized that organizational size and age would be negatively related to franchisee assessments of entrepreneurial strategies the introduction of new products and techniques and franchisor managerial support for franchisee entrepreneurial activity and innovation in contrast rapid growth was hypothesized to be positively associated with entrepreneurial strategies and support for franchisee innovation no hypotheses were proposed with respect to time in franchising results of the study showed as hypothesized that franchisor size was associated with a concern for stability and strategies that were risk averse cooperative and reactive rather than proactive however size was positively associated with the frequent introduction of new products and also positively related to franchisor support for franchisee innovation contrary to expectations age was positively associated with entrepreneurial strategies including a low concern for stability and an aggressive style of competition in addition age was positively associated with the introduction of both new products and new techniques relative growth rather than an absolute rate of growth was associated with all of the entrepreneurial strategies except risk taking as well as with the frequent introduction of new products although no hypotheses were proposed for time in franchising the findings show that it is associated with a greater concern for stability as well as the infrequent introduction of new products and techniques the findings from this study suggest that franchisors need to institute measures to counteract the potentially deleterious influences of franchise system size on the entrepreneurial orientation within their franchising systems it also suggests the resources of a large organization need to be combined with the flexibility of smaller units for competitive advantage entrepreneurial activity by franchisors and franchisees implies a partnership in adapting to the environment and can provide a competitive advantage the challenge for franchisors will be managing new ideas from the field and adapting to a competitive environment while at the same time preserving the integrity of the franchising system

input output simulations of energy environment economy interactions in the uk this paper shows how a number of the complex interrelationships between energy environment and economic welfare can be investigated with the aid of a 10 sector input output i o model of the uk with pollution emission coefficients and a european sulphur deposition vector the paper reviews relevant past applications of i o analysis in the energy environment area and describes the endam program and its operation it is used to simulate the effects of a variety of policies and possibilities not only through changes in exogenous variables final demand and income taxes and transfers but also through changes in the structural matrices and their coefficients in each case the full effects direct indirect and income induced can be traced and the changes in comparative static equilibrium values discovered in this way policy issues connected with energy use and environmental impacts employment and economic welfare have been investigated

renewable energy sources their global potential for the first half of the 21st century at a global level an integrated approach abstract the risk of human induced climate change and the volatility of world oil markets make non fossil fuel options important this paper investigates the potential for wind solar pv and biomass wsb to deliver energy the focus is on land opportunities and constraints and on production costs as a function of resource availability and depletion and of innovation dynamics the context is provided by the ipcc sres scenarios as simulated with the image 2 2 model we explicitly consider several sources of uncertainty aspects of the food vs energy trade off and the effects of interaction between the three options through their claims on land we show that potential production concepts are strongly dependent on the chosen land use scenario and should therefore be used with an indication of the underlying assumptions our results indicate a potential for liquid biofuels in the order of 75 300 ej year 1 and for electricity from wsb options at production costs below 10 kwh 1 of 200 300 pwh year 1 theoretically future electricity demand can be amply met from wsb sources in most regions by 2050 below 10 kwh 1 but major uncertainties are the degree to which land is actually available and the rate and extent at which specific investment costs can be reduced in some regions competition for land among the three wsb options may significantly reduce the total potential as estimated from simple addition which is another source of uncertainty

an empirical look at franchising as an organizational form franchise contracts are identified as a hybrid form of economic organization motives for the dominance of franchise arrangements are identified by examining the theoretical literature on franchising and related literatures on the theory of the firm firm growth managerial and employee selection a nd brand name capital empirical tests are performed on the incidence of franchise contracts across states for three industries in which f ranchising is prominent and data are readily available the results s uggest that both principal agent incentives and informational incenti ves favor the use of franchise arrangements copyright 1988 by the university of chicago

budget reallocation and the peace dividend energy and pollution tradeoffs abstract despite the attention received during times of crisis energy conservation policy and pollution abatement strategies are seldom considered in the formulation and implementation of government expenditure decisions not directly related to energy use and pollution emissions this paper deals with measurement of the energy and pollution costs associated with various budgetary categories including defence education and other non defence components of expenditure in deciding between alternatives such knowledged provides a broader decisionmaking context potentially useful in assessing the major alterations in defence and non defence expenditures that may soon take place as tensions between the usa and the ussr diminish empirical estimates show that budgetary reallocation away from defence can result in important reductions in energy use and pollution emissions

structural path analysis and multiplier decomposition within a social accounting matrix framework the main purpose of this paper is to apply structural path analysis to a social accounting matrix sam framework because the sam is a comprehensive essentially general equilibrium data system the whole network through which influence is transmitted can be identified and specified through structural path analysis the latter provides an alternative and much more detailed way to decompose multipliers as compared with the traditional treatment of stone 1978 and pyatt and round 1979 this paper consists of five sections the first one reviews the sam framework as a basis for multiplier analysis and multiplier decomposition in particular the additive decomposition in terms of transfer open loop and closed loop effects is succinctly presented section ii applies this conventional decomposition to a sam of south korea to illustrate with eleven specific cases the effects of an exogenous injection on the endogenous accounts of the sam i e the incomes of the factors household groups and production activities section iii is devoted to the presentation of the elements of structural analysis and more particularly the transmission of economic influence within a structure finally section iv applies structural path analysis to the south korean sam and compares and contrasts the multiplier decomposition which it yields with the alternative decomposition discussed in section ii the comparison is the more significant in that the two decomposition methods are applied to the same eleven selected cases spanning a variety of sectors i e poles of origin for the injection and sectors poles of destination the empirical analysis in section iv suggests that structural path analysis applied to a sam is a potentially operationally useful technique within which a whole series of policy issues can be addressed the final section is devoted to a brief summary and conclusions

comprehensive evaluation of household indirect energy consumption and impacts of alternative energy policies in china by input output analysis abstract households consume a large amount of indirect energy through the consumption of goods and services this fact makes the quantitative analysis of indirect household energy consumption the foundation of energy policy design this paper improves the compilation method of energy input output tables and establishes a sequence of energy input output tables for china based on these tables the indirect energy consumption of both rural and urban households is calculated then with economic data for the year of 2005 the adjusted input output price model is applied to evaluate how the alternative energy policies impact production prices consumption prices and real income of rural and urban households through the mechanism of indirect energy consumption by using electricity as an example this research has practical implications for chinese economy the integration of energy efficiency improvements and energy prices increase serves as a means to achieve both economic and energy conservation goals and may also have a positive effect on residents real income and a minimal effect on production prices

estimating quadratic variation using realized variance this paper looks at some recent work on estimating quadratic variation using realised variance rv that is sums of m squared returns this econometrics has been motivated by the advent of the common availability of high frequency financial return data when the underlying process is a semimartingale we recall the fundamental result that rv is a consistent as m estimator of quadratic variation qv we express concern that without additional assumptions it seems difficult to give any measure of uncertainty of the rv in this context the position dramatically changes when we work with a rather general sv model which is a special case of the semimartingale model then qv is integrated variance and we can derive the asymptotic distribution of the rv and its rate of convergence these results do not require us to specify a model for either the drift or volatility functions although we have to impose some weak regularity assumptions we illustrate the use of the limit theory on some exchange rate data and some stock data we show that even with large values of m the rv is sometimes a quite noisy estimator of integrated variance

currency hedging for international portfolios this paper examines the benefits from currency hedging both for speculative and risk minimization motives in international bond and equity portfolios the riskreturn performances of globally diversified portfolios are compared with and without forward contracts over the period 1974 to 1990 inclusion of forward contracts results in statistically significant improvements in the performance of unconditional portfolios containing bonds conditional strategies are also implemented both in sample and out of sample and are shown to both significantly improve the risk return tradeoff of global portfolios and to outperform unconditional hedging strategies whether international portfolios should be hedged against currency risks is the subject of an active debate the theoretical side of the debate has been closely associated with two strands in the academic literature international asset pricing and optimal hedging in the futures markets in the international asset pricing model iapm of solnik 1974 optimal portfolios contain positions in forward contracts or equivalently foreign currency denominated bills these positions which can differ from the positions in foreign stocks have since been termed hedges black 1990 shows that under additional assumptions the hedge ratios should be identical for all investors regardless of their nationality universality and that investors should never fully hedge their foreign currency exposures similarly theoretical models from the futures literature produce demands for hedging instruments that contain both speculative and hedging components the empirical issue unanswered so far is whether adding forward contracts to international portfolios significantly improves the risk return profile of global investments empirical research has barely begun to respond to the challenges of theoretical models there exists little empirical evidence on either the relevance of black s universal hedge ratios or the optimality of hedge ratios less than one instead researchers have concentrated on the benefits of fully hedging exchange risk for example eun and resnick 1988 indicate that stock portfolios perform better when fully hedged but offer no statistical tests

sources of output change in china 1987 1997 application of a structural decomposition analysis since the beginning of the economic reforms implemented in the industrial sectors of china the economy has grown and changed rapidly the high gdp growth rates recorded since 1985 have stimulated unprecedented changes in the economic structure of this developing economy the major causes of the changes are the increase in consumption and investment production technological change and trade the objective was to analyse this type of structural change and to explore the sources of economic growth during the period 1987 1997 by using the method of structural decomposition analysis sda the chosen sda method based on the comparison between two input output tables allowed us to decompose each sector s and industry s output growth it enabled the relative impact of final demand and technological change of each industry on overall growthto be measured

crossing mother entrepreneur franchisees attempts to reduce franchisor influence abstract contractual terms guide many entrepreneur franchisees actions with the franchisor however it is impossible for franchisors to completely specify all future actions they compensate by continually attempting to influence franchisees using what franchisees perceive as suasion in their ongoing interactions we develop a theoretical framework for understanding the informal interaction dynamics between franchisors and franchisees most franchise arrangements include the payment of royalties based on sales this encourages a growth oriented strategy usually appropriate for the franchisees during the initial stages of their operations whereas a franchising strategy can reduce entreprenerial risk for franchisees it does not eliminate it thus as sales of the franchisees increase profit oriented strategies will be favored because they represent the payoffs that accrue to continuing entrepreneurial effort and risk taking these strategies may be in opposition to franchisors sales orientation when market conditions do not allow continual growth without margin penalties a research model is developed depicting the relationship between franchisees strategies and performance and the moderating effect that contractual goals and franchisees perception of franchisors attempts at suasion have on this relationship a set of research hypotheses was then empirically tested using a large sample of franchisees from the commercial truck retailing industry the results indicate that sales growth and profit growth goals are not always congruent balancing the goals of the franchisor and franchisee did not appear to be a popular option either one or the other was emphasized more importantly the results indicate that when franchisees perceive attempts by franchisors to use suasion lower levels of profits result but there is no corresponding increase in the level of sales in the long term franchisors are likely to determine that current contractual arrangements are not protecting their longer term interests thus they will be expected to attempt to modify franchise contracts in ways that force franchisees to implement sales gain strategies this will require that entrepreneur franchisees anticipate future events more carefully at the time they are examining the original franchise contract because most entrepreneurs are concerned with immediate survival at the start up stage this makes examination of the contract less likely to happen the franchise option is attractive because it reduces such risks we recommend that entrepreneurs write ex ante contingent claims contracts that ensure a gradual reduction of franchisor influence although this would assume a power or knowledge balance that favors the franchisees which is unlikely during the start up phase it will change over time as franchisees gain a better understanding of the local competitive dynamics thus it may well serve the franchisees to take a defensive posture or push a royalty arrangement that decreases the emphasis on sales over time this is most likely to be effective where the entrepreneur is considering several competing franchises at the time of the signing of the contract finally we recommend that entrepreneur franchisees should not assume that the expert advice offered by their franchisor is always in their best interests although technical advice is more likely to be unbiased and should be fully exploited as this is what makes the franchise valuable strategic advice or that which relates to goal setting may well be colored by the financial interests of the franchisor franchisors are unlikely to consider the possibility that franchisees would be better served by formulating their own strategies nor are they likely to consider that the franchise network would be better off in the longer term by the collective impact associated with numerous franchisees independently formulating their own strategies in short although we do not suggest that franchisees should always assume that crossing mother is the best response to all perceived franchisor suasion efforts they should carefully examine all strategic advice

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

structural decomposition analysis of physical flows in the economy many environmental problems can be attributedto the extraction and emissions of physicalsubstances increasing our understanding of theeconomic and technological driving forcesbehind these physical flows can contribute tosolving the environmental problems related tothem the input output framework is a usefulsetting in which to integrate detailedinformation about economic structure andphysical flows in this article a specificmethod in input output analysis is reviewed namely structural decomposition analysis sda it is based on comparative static analysis which decomposes historical changes of a policyvariable into determinant effects sda has beenapplied for example to analyze the demand andtechnological driving forces of energy use co2 emissions and various other pollutantsand resources this article examines thetheoretical aspects of structuraldecomposition in particular those concerningphysical flows and environmental issues furthermore the article includes an extensivesurvey of empirical studies

the choice of organizational form the case of franchising abstract we examine companies that franchise some units and centrally operate own others the agency problems confronting these two organizational forms are analyzed testable hypotheses are developed the empirical results support the notion that owning versus franchising reflects a trade off among agency related problems the cost of monitoring store managers appears to be especially important in the own franchise decision the level of repeat business and initial investment requirements per unit also appear to be important

scale technique and composition effects in trade related carbon emissions in china this study applies structural decomposition analysis to evaluate the scale composition and technique effects of trade related carbon emissions in china mainland from 1987 to 2007 the initial findings indicate that the increasing magnitude of china s trade both in terms of the carbon emissions embodied in exports and the carbon emissions avoided via imports had large scale effects during the whole period the technique effect caused by changes in input mix sector energy intensity fuel mix and carbon coefficients effectively offset part of the scale effect during the entire period but failed to do so during some sub periods changes in trade composition caused a relative small increase in the carbon emissions created by exports but a relative small decrease in the carbon emissions avoided via imports during the whole period

an analysis of co2 emissions of japanese industries during the period between 1985 and 1995 this paper examines the factors that have an effect on co2 emissions produced by japanese industries between 1985 and 1995 by using input output tables the effects of environmental technological changes etc and production technological changes ptc on co2 emissions are considered separately furthermore backward and forward linkage effects in each sector that shows the extent to which each sector spreads or receives co2 emissions impacts across all of sectors will be calculated the results show that both types of technologies contributed to a decrease in co2 emissions during the bubble economy of the late 1980s but not during the recession of the early 1990s trade factors succeeded in decreasing co2 emissions in both periods thus trade structures facilitated the turning of japan into a net importer of co2 emissions between 1985 and 1995 the backward and forward linkage effects also decreased during the boom of the late in 1980s but not the recession of the early 1990s while the chemical products and electrical machinery sectors continued to reduce both effects this indicates that both sectors were relatively successful in decreasing their co2 emissions impacts between 1985 and 1995

walking away from a low carbon economy recent and historical trends using a regional decomposition analysis using the latest available data this brief article attempts to provide the first regional decomposition analysis of co2 emissions from fuel combustion covering eight regions of the world determinants are estimated in relative and absolute terms for the period 1971 2010 we take the 2010 global surge in co2 emissions as an entry point for the analysis overall results show that most regions have recently performed worse than their historical trends and lack of meaningful progress is identified whereas specific drivers for certain regions suggest some level of continuous improvement e g reduced energy intensity in asia they are incapable of offsetting the effects of economic growth and energy use with the exception of africa most regions appear to have missed the low carbon economy opportunity provided by the 2008 2009 global financial crisis results suggest a lack of serious environmental effectiveness of regional policy portfolios aiming at reducing co2 emissions highly ambitious energy efficiency and renewable energy policies across all regions are immediately needed additionally absolute reductions in co2 emissions and energy use from fossil fuels are urgently required in rich regions if we are to align production and consumption patterns with maintaining global warming below the 2 c threshold

carbon dioxide emissions in the u s economy a structural decomposition analysis this paper provides an empirical analysis of the impact of various influences on carbon dioxide emissions it incorporates methodological refinements of input output structural decomposition analysis which is the examination of economic change by means of a set of comparative static variations in key parameters of i o tables the analysis is performed using a two tiered klem model which allows for estimation of substitution and technological change effects within and between input aggregates the model is used to decompose the sources of change in co2 emissions in the u s over the 1972 82 timeframe using hybrid energy value tables for the initial and terminal years results show the significant effect of substitution within the energy sector and between energy and other inputs as the leading causes of the decline in carbon dioxide emissions

international portfolio choice liquidity constraints and the home equity bias puzzle this paper solves for optimal international portfolio choice in the presence of liquidity constraints and undiversifiable labor income risk optimal portfolios are internationally diversified while positive correlation between domestic stock market returns and permanent labor income shocks can generate a complete portfolio specialization in foreign stocks nevertheless either small costs associated with investing abroad or a slightly positive domestic to foreign equity premium differential are sufficient to either deter households from participating in a foreign market or generate a substantial bias for home equities the benefits of international diversification are limited because consumption fluctuations can be smoothed with a small amount of buffer stock saving while exchange rate risk makes foreign investments less appealing to risk averse investors

managerial rents and outside recruitment in the coasian firm in the corporation decision making about the use of capital by managers and risk taking by the owners of capital are specialized activities various institutional mechanisms have been analyzed as forces disciplining the opportunistic behavior of management under these conditions we maintain that no single mechanism such as wage revision in the managerial labor market or an internal device that relies on influencing incentives by making executives residual claimants in the firm is sufficient to solve problems of managerial incentives instead the margins of several control devices are extended simultaneously to maximize the value of the firm net of the cost of control in this context we will emphasize one means of managerial control which has not been fully analyzed to date the impact of outside hiring on the behavior of incumbent managers

equilibrium exchange rate hedging we assume a world like the one that gives the capital asset pricing model but with many goods and many countries we assume that investors in a given country have homothetic utility functions with the same weights and a currency that has a sure endof period value using a price index with those weights siegel s paradox derived from jensen s inequality makes investors want a positive amount of exchange risk when average risk tolerance is the same across countries every investor will hold the same mix of market risk through the world market portfolio of all assets and exchange risk in a diversified basket of foreign currencies in fact the ratio of exchange risk to market risk is equal to the average investor s risk tolerance we can write the ratio of exchange risk to market risk and the fraction of the market s exchange risk that investors hedge as depending on an average of world market risk premia an average of world market volatilities and an average of exchange rate volatilities the weights in these averages are the same as the weights of the different countries in the currency basket given these averages the ratio and the fraction hedged will not depend directly on exchange rate means or covariances in equilibrium we can use the ratio of exchange risk to market risk to measure average risk tolerance in this model risk tolerance is observable

the challenge of autonomy and dependence in franchised channels of distribution abstract an enduring challenge for franchise management involves the reconciliation of 1 the franchisor s desire for standardization consistency and control for the preservation of its goodwill and brand equity and 2 the franchisee s quest for autonomy especially because franchises are frequently sold on the platform of be your own boss and have historically attracted would be franchisees with self employment histories and strong streaks of independence and autonomy building on arguments derived from agency theory resource dependence theory the locus of control argument and the countervailing power premise the present study attempts to evaluate 1 the interrelationships between the concepts of autonomy and dependence and 2 the influence of competition success experience and multi unit ownership as determinants of the various autonomy dependence perceptions it is suggested that contrary to the dominant perspective nested in the markets versus hierarchy dichotomy which portrays the sentiments of dependence and autonomy as opposing theoretical variables i e they are envisioned to exist only in high low combinations of these two constructs even their high high and low low combinations can emerge within a franchise setting and that these diverse behavioral settings entail unique management challenges the empirical portion of the study utilizes data drawn from the franchised channel of fastfood restaurants the results support the emergence of all four combinations of dependence and autonomy i e the traditional high low combinations as well as the high high and low low combinations suggesting that behavioral settings of franchises are indeed richer than hitherto imagined it appears that because franchisee franchisor relationships encompass several domains they each feel dependent on the other party in certain domains and simultaneously autonomous in other domains the environmental factor of competition the relationship factor of business success experienced in the franchise system and the structural factor of multi unit ownership emerged as significant predictors of dependence and autonomy notably however the countervailing power argument was not supported by the data the multi unit ownership effects were especially strong and provided a more direct test of the alignment of goals and incentives envisioned by agency theory we conclude by identifying four categories of franchisees with distinct gestalts that franchisors would do well to learn to manage in the spirit of portfolio management

international financial integration through equity markets which firms from which countries go global the authors study international financial integration analyzing firms from various countries raising capital trading equity and cross listing in major world stock markets using a large sample of 39 517 firms from 111 countries covering the period 1989 2000 they find that although international financial integration increases substantially over this period only relatively few countries and firms actively participate in international markets firms more likely to internationalize are from larger and more open economies with higher income better macroeconomic policies and worse institutional environments these firms tend to be larger grow faster and have higher returns and more foreign sales while changes occur with internationalization these firm attributes are present before internationalization takes place the results suggest that international financial integration will likely remain constrained by country and firm characteristics

what causes the change in energy demand in the economy the role of technological change this paper proposes a simple and theoretically clear approach to the estimation of technological change in a multisector general equilibrium framework this study employs the multiple calibration decomposition analysis mcda to evaluate technological change that is responsible for changes in energy use and carbon dioxide emissions in the japanese economy in the oil crises period from 1970 to 1985 the mcda serves as an elementary way of separating structural change due to technological change from that due to price substitution effects capturing the interdependence among economic sectors the empirical result provides a better understanding of the effects on the economy of technological change in that significant period

energy and depletable resources economics and policy 1973 1998 abstract this paper reviews the impact of the literature in depletable resources and energy economics over the period 1973 1998 particularly the initial period of publication of the journal of environmental economics and management 1974 1998 a discussion of prominent policy issues in this arena is provided along with an indication of what academic economics papers have contributed to that debate this is followed by a citation analysis of contributions in the fields of energy and exhaustible resource economics for each of these two fields a list of the top papers in each five year period from 1974 to 1998 is presented along with a list of the top journals in each decade based on average citations per article the top ten cited articles in the fields in the journal of environmental economics and management are also presented

the modern history of exchange rate arrangements a reinterpretation we develop a novel system of reclassifying historical exchange rate regimes one key difference between our study and previous classifications is that we employ monthly data on market determined parallel exchange rates going back to 1946 for 153 countries our approach differs from the imf official classification which we show to be only a little better than random it also differs radically from all previous attempts at historical reclassification our classification points to a rethinking of economic performance under alternative exchange rate regimes indeed the breakup of bretton woods had less impact on exchange rate regimes than is popularly believed

the economics of franchise contracts as an organizational arrangement the franchise contract lies between anonymous price mediated exchange and centralized intrafirm employment in contrast to conventional market exchange franchise contracts typically impose on franchisees retail quality standards common hours of business price controls and nonlinear payment schedules for example fixed initial royalty fees plus a percentage of gross retail revenues while franchisors typically provide national advertising and training programs monitor and inspect the franchisees performance with varying intensity across industries and hold the residual power to terminate the franchise agreement observations of actual terminations indicate that franchisors sometimes exclude this power franchisors sometimes face persistent queues of potential franchisees in contrast to simple employment contracts franchise agreements provide for sharing of profits through royalties on revenue or output and considerable freedom for independent decisions by local franchisees 1 why do these franchise contracts exist