the effects of flexible specialization on industrial politics and the labor market the motion picture industry the authors citing historical and statistical evidence spanning three decades examine how the transition to flexibly specialized production organization in the motion picture industry has changed the distribution of work and wages and the definition of skills one important result of that process has been the emergence of a new form of intra occupational labor market segmentation based much less on differences in hourly wage rates than on differential access to hours of work also the reorganization of the production process has altered the relative bargaining power of employers and workers and of different groups within the industry work force resulting in increased conflict among segments of the work force and a strengthening of employers bargaining power vis a vis industry unions

cartoon planet worlds of production and global production networks in the animation industry as more animated films are produced new worlds of production have emerged the animation production system is distinct from film production relying on different technologies and labor skills its globalization therefore has taken place differently although both are structured by the global production networks of the media conglomerates we present a framework for understanding the animation industry its international division of labor and its diverse markets enabled by pools of artistic labor growing demand and the diffusion of production skills copyright 2010 the author 2009 published by oxford university press on behalf of associazione icc all rights reserved oxford university press

power in firm networks what it means for regional innovation systems christopherson s clark j 2007 power in firm networks what it means for regional innovation systems regional studies 41 1223 1236 the role of power within regional firm networks is noted in empirical studies but insufficiently theorized it is suggested that network functioning is conflictual and that more powerful network members particularly transnational corporations tncs leverage regional resources to advance their sustainable competitive advantage the agendas and power exercised by tncs within regionalized firm networks have significant implications for regional policy and the uneven allocation of resources and capacities within and among regions the findings indicate that transnational firm access to resources that are critical to innovation including university research and skilled labour negatively affects the potential for innovation by small and medium size firms christopherson s et clark j 2007 le pouvoir au sein des reseaux d entreprise son importance pour les systemes d

staggered contracts and the frequency of price adjustment this paper describes a methodology for measuring the frequency of price change in order to test the relevance of assuming prices to be set for discrete periods of time at overlapping intervals taylor 1980 has related the frequency of adjustment to the rigidity of the economy in responding to unanticipated events estimates of the frequency of price change are computed from data on the component parts of the deflator for personal consumption expenditure the results show a substantial decrease in the period between price changes during the middle 1960s and marked fluctuations in the 1970s the movements suggest changes in the rigidity associated with both changes in general price inflation and changes in the posture of the fiscal and monetary authorities

on barro s theorem of debt neutrality the irrelevance of net wealth the effects of national debt on real economic activity has been a recurring topic in the literature on macroeconomic policy analysis since the time of adam smith the problem is usually stated as follows for a given level of government spending is the economy sensitive to the financing mix between tax and debt historically attention has focused on the question of whether or not individuals perceive government bonds as net wealth the link between wealth and real activity being taken as given the main point of debate is well established the issue of bonds raises private assets by the full value of the bonds the corresponding tax liabilities for interest payments and retirement of the debt extend indefinitely into the future the perception of bonds as net wealth would then appear to depend on the length of the individual s optimization horizon the most recent contribution to this debate was made by robert barro 1974 in which he argued that despite the limitation of finite lives bonds will not be regarded as net wealth in a system characterized by operative intergenerational transfers the essence of his argument is that inclusion of a bequest motive effectively converts a finite horizon into an infinite one in that paper barro acknowledged a potential limitation on his proof of the neutrality result it was only valid for bonds that are redeemed at a known point in the future this limitation was raised again in a subsequent exchange with martin feldstein in which barro 1976 agreed that for a growing economy an increase in steady state per capita debt will generate net wealth if the rate of growth is greater than the interest rate however he argued that such a steadystate growth situation would not be consistent with rational utility maximizing behavior the main theme of this paper is that the literature has focused attention on the wrong question the real effects of national debt are independent of whether or not individuals perceive the debt as net wealth the correct question is whether or not changes in the level of debt force individuals into patterns of intertemporal consumption that they are unable to neutralize by adjustments in their portfolio behavior viewing neutrality in this light leads to some reinterpretation of the conditions under which neutrality is likely to hold my analysis starts where barro and feldstein leave off within the framework of the overlapping generations model with gift and bequest motives i show that steady state equilibrium growth is consistent with a growth rate in excess of the interest rate indeed without specific knowledge of the parameters of the economy there are no a priori grounds on which to expect any particular relationship between the growth and interest rates more importantly so long as it is valid to view the aggregate economy as behaving like a composite individual changes in the steady state level of government debt are neutral regardless of which relationship prevails provided one or the other of the intergenerational transfer motives is operative i will refer to this as the extended neutrality theorem section i presents an analysis of steadystate growth with gift and bequest behavior the steady state growth path is shown to lie above the golden rule solution if the gift

menu costs and the neutrality of money a model of endogenous price adjustment under money growth is presented firms follow s s pricing policies and price revisions are imperfectly synchronized in the aggregate price stickiness disappears and money is neutral the connection between firm price adjustment and relative price variability in the presence of monetary growth is also investigated the results contrast with those obtained in models with exogenous fixed timing of price adjustment

dynamic duopoly with adjustment costs a differential game approach abstract this paper develops a differential game model of duopoly in which firms incur costs associated with how fast they change their level of output the analysis solves for a subgame perfect equilibrium to the model in which the steady state level of output lies strictly between the static cournot and perfect competition solutions furthermore we demonstrate that the limit game in which the speed of adjustment parameter approaches zero does not tend toward the static cournot equilibrium

part time work and the hiring of older workers this research uses german establishment data to examine the relationship between back loading compensation the hiring of older workers and their part time status we confirm that establishments that defer compensation are less likely to hire older workers we demonstrate for the first time that establishments that defer compensation are more likely to limit older workers to part time jobs when they do hire them thus deferred compensation plays a larger role in reducing the chances of older workers being hired into full time jobs than would be inferred from past estimates simply examining their odds of being hired at all

markov puppy dogs and related animals abstract it is shown that steady state markov perfect equilibria of discrete time infinite horizon quadratic adjustment cost games differ from equilibria of their infinitely repeated counterpart games with zero adjustment costs even though no adjustment costs are paid in the steady state in contrast to continuous time games the limit of these equilibria as adjustment costs approach zero is the same as the equilibria of their static counterpart games a classification scheme is presented and it is shown that the taxonomy is identical to that of analogous two stage games such as those analyzed by fudenberg and tirole american economic review papers and proceedings 1984 74 361 366 this classification is useful in that it implies that steady state equilibria need not be explicitly calculated to analyze qualitatively the effects of adjustment costs in strategic environments it is also argued that estimated conjectural variations parameters may capture a well defined property of strategic interaction in a dynamic game

public debt and demographic growth in an overlapping generations model abstract the comparative dynamics of changes in the rate of population growth are discussed in an overlapping generations economy where there is public debt the focus is on the effects of such variations on capital accumulation factor returns and welfare of individuals living in steady states

internal labor markets contrary to the popular image of change and turnover most americans spend the majority of their working lives employed in a single firm the original essays in this book discuss the origins and importance of these internal labor markets providing new insights into their changing power and influence they also explore the more varied and dynamic employment practices that have evolved in large companies in response to new government regulations increased competition for managerial talent the difficult economy of the 1970s and to the threat of unions contents introduction the nature and importance of internal labor markets paul osterman the development of internal labor markets in american manufacturing firms sanford m jacoby the making and shaping of job and pay structures in the iron and steel industry bernard elbaum variations in managerial career structures in high technology firms the impact of organizational characteristics on internal labor markets rosabeth moss kanter the transformation of the industrial relations and personnel function thomas a kochan and peter cappelli white collar internal labor markets paul osterman job training employment practices and the large enterprise the case of costly transferable skills paul ryan the search for a societal effect in the production of company hierarchy a comparison of france and germany marc maurice francois sellier and jean jacques silvestre internal labor markets and paternalism in rural areas peter b doeringer

the mis behaviour of the aggregate price level this paper investigates the response of the price level to random monetary shocks through a model of the fixed cost of changing a nominal price it shows that in an inflationary environment an expansionary monetary shock is accommodated faster than a contractionary monetary shock furthermore when the average rate of monetary expansion increases the lag in response to a positive shock decreases the study also proves that the relationship between the expected rate of inflation and the variance of real prices is positive only above a critical level of expected inflation the most striking result in this area appears in the work of caplin and spulber 1987 they show that in the aggregate when inflation is monotone stickiness disappears even when all firms follow a strict s s rule in their model since firms are uniformly distributed discontinuous price adjustment at the firm level does not create stickiness at the aggregate level caballero and engel 1992 extend this analysis to incorporate idiosyncratic shocks they show that in the presence of monotone idiosyncratic shocks the long run stationary distribution of prices is the uniform distribution but in the short run when the distribution of prices is arbitrary aggregate stickiness can result from firms discontinuous price adjustments in the present work the focus shifts i use a model where aggregate stickiness emerges naturally from firms discontinuous price setting to investigate the effects of the rate of inflation on aggregate stickiness this work shows that aggregate stickiness is negatively correlated with the rate of inflation the higher the rate of inflation the less sticky the response of the aggregate price level with respect to positive nominal shocks and the closer the economy approaches the caplin and spulber model therefore when modeling a dynamic inflation tax one must account not only for the decrease in the monetary base but also for the increase in the speed at which the aggregate price level 889

monopolistic competition and the effects of aggregate demand how important is monopolistic competition to an understanding of the effects of aggregate demand on output we ask the question at three levels can monopolistic competition by itself explain why aggregate demand movements affect output can it together with other imperfections generate effects of aggregate demand in a way that perfect competition cannot if so can it give an accurate account of the response of the economy to aggregate demand movements the answers are no yes and yes

flexible production and the transformation of industrial relations in the motion picture and television industry the authors trace the development of the motion picture and television production industry s three tier compensation scheme showing how incremental solutions to unanticipated problems broadly transformed labor relations by changing key institutional relationships this example they argue demonstrates that a fundamental transformation in the unionemployer relationship need not originate in high level strategic planning and may represent hope for the survival of collective bargaining in other industries

inflation fixed cost of price adjustment and measurement of relative price variability theory and evidence in an interesting paper julio rotemberg 1983 extends the works of eitan sheshinski and yoram weiss 1977 and michael mussa 1981 to examine the aggregate consequences of monetary growth in an economy in which sellers incur a fixed cost of price adjustment the fixed cost prevents a continual adjustment of individual prices so each seller keeps his price constant in periods of discrete length increasing his price in discrete jumps at the end of these periods a central feature of the inflationary process is therefore that relative prices become dispersed around their means and the theory predicts that even a fully anticipated inflation increases the variability of relative prices the empirical evidence on this point does however appear to be mixed on the one hand richard parks 1978 and stanley fischer 1981a b 1982 conclude that anticipated inflation does increase relative price variability which fischer interprets as providing empirical support for the theory on the other hand mario blejer 1981 1983 and blejer and leonardo leiderman 1982 find that anticipated inflation has no effect or only a very weak effect on relative price variability which makes john taylor 1981 doubt the quantitative significance of the theory 2 this paper uses rotemberg s theoretical framework to demonstrate that the proxy for relative price variability adopted in the empirical literature does not properly capture the relative price variability that is caused by a fixed cost of price adjustment the methodology of the above cited studies is therefore not appropriate for evaluating the empirical relevance of the fixed cost theory and the divergence of their results is not surprising specifically the proxy which consists of the variance of the rates of price change between successive observations does not always increase with the anticipated inflation even with disaggregate data 3 the proxy decreases with the anticipated inflation in approximately half of any interval of inflation rates for which a seller adjusts his price no more than a given number of times between successive observations moreover the relationship between the anticipated inflation and the proxy depends on such extraneous factors as the timing of the observations a change in the timing may change a positive relationship between the anticipated inflation and the proxy to a negative one and vice versa the paper also proposes alternative more satisfactory measures of relative price variability and provides empirical support for the theoretical conclusions

on debt neutrality in life cycle models abstract a parallelism is established between pure life cycle models and those in which altruism is one sided in the discussion of the public debt neutrality it is argued that when indiduals behave as pure life cyclers the coercive transfers necessary to offset the effects of the debt have the same nature and take place under the same conditions as the voluntary intrafamily bequests and gifts which constitute the usual basis for the ricardian equivalence theorem

capacity investment preemption and commitment in an infinite horizon model the commitment value of capacity is analyzed in an infinite horizon duopoly model the paper focuses on the role of alternative behavioral assumptions about the ability of firms to commit to investment paths each firm s investment strategy in a feedback nash equilibrium is shown to be a decreasing function of its rival s current capacity this creates an incentive for a firm to expand its capacity to preempt subsequent rival investment in a precommitment equilibrium there are no incentives to invest preemptively as a consequence steady state capacity levels are greater in a feedback nash equilibrium than in a precommitment equilibrium copyright 1987 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

sticky prices in a dynamic oligopoly an investigation of s s thresholds abstract the strategic implications of costly price adjustment are investigated empirically i assume that managers are engaged in a state space game and ask if the dynamic considerations that arise when they condition their choices on the state cause prices to be more or less rigid than when players use more myopic pricing rules the answer to this question depends on a parametric specification of the problem that lends itself to empirical assessment the micro panel data used to investigate this issue consist of weekly prices sales costs and promotional activity for three brands of saltine crackers sold by four chains of grocery stores in a small us town i find that in this market strategic behavior exacerbates price rigidity the thresholds are wider and the time between changes is longer than would be observed in a more myopic setting

labour market segmentation and workers careers the case of the italian knitwear industry this paper reports on empirical research into the labour market in the knitwear and ready to wear industry in the province of jvjodena emilia in particular it looks at the careers of three categories of workers homeworkers those employed on the production lines of larger firms and artisans 1 italy in common with many other industrialised capitalist countries has witnessed a growing decentralisation of production this tendency has been differently interpreted but a consensus is emerging that such developments are not evidence of economic backward ness 2 on the contrary an industrial structure consisting of firms of different size but with a large number of small and even microscopic enterprises is increasingly being recog nised as one possible avenue of economic development taking this for granted the aim of these notes is to investigate the structure of the labour market in a prosperous area typified by economic growth which has the small firm as its base element

optimum pricing policy under stochastic inflation we describe aggregate inflation as a stochastic process in which the rate of change of the price level can be positive or zero where the times spent in each state are of random duration this class of processes includes two state markov chains and renewal processes as special cases it is shown that the optimal pricing policy of a monopolistic firm with non convex costs of price adjustment is s s in its real price i e its nominal price relative to the price level a basic certainty equivalence result is proved i e the firm behaves as if it faces a certain and fixed rate of inflation higher than the actual expected rate the difference between the two rates being a risk premium which depends on the real interest rate and the parameters of the stochastic process one can thus apply previous results from the case of certainty sheshinski and weiss review of economic studies 1977 to obtain comparative static results in particular one finds that an increase in the variance of expected inflation leads firms to choose a pricing policy with larger amplitude in real price the paper also addresses the question of consistency in firms expectations when the price level is determined by the firms actions in this paper we consider pricing policies of individual firms in an inflationary environment each firm expects the general price level to increase and must determine the rate of increase of its own price it is assumed that the firm incurs an adjustment cost when it changes its nominal price consequently firms choose to change prices occasionally rather than continuously

social security and savings plans in overlapping generations models abstract this paper examines the impact of social security and saving plans on a simple overlapping generations model with no uncertainty the model is related to and provides a reconciliation of the diamond and samuelson gale models of public debt and public capital savings plans and pay as you go social security are seen to have quite different effects depending on the assumptions governing the growth rates of public debt and capital and it is also shown that the social security program proposed by feldstein is infeasible in the steady state he adopts as a starting point

government debt in an overlapping generations model with bequests and gifts in 1974 robert barro argued that if individuals in successive generations were linked by bequests changes in the stock of government debt or in social security programs would have no effect on the steady state capital stock barro assumed that individuals held static expectations and that the size of the population was constant martin feldstein 1974 1977 had concluded that social security would reduce the capital labor ratio in models that did not admit a bequest motive and in his 1976 comment on barro argued that the introduction of government debt or social security into a perfect foresight dynamic growth model with bequests would still reduce the capital labor ratio barro replied that feldstein s criticisms were invalid if the steady state capital labor ratio were smaller than the golden rule level but would be correct if the opposite were true barro did suggest however that the latter possibility with overaccumulation of capital might be ruled out in his model as it was in miguel sidrauski 1967 but he was unable to demonstrate that the required behavior would be consistent with utility maximization by finite lived individuals 1976 p 345 although recent work by willem buiter 1979 jeffrey carmichael 1979 1982 truman bewley 1981 a b and others has helped to elucidate the nature of overlapping generations models with bequests and gifts and the issues in the barro feldstein debate they remain far from clear the purpose of this paper is to shed a little more light on the subject in what follows i contend that some of the authors cited above either have specified the individual s optimization problem in an asymmetric way or have failed to impose necessary conditions for a sensible optimization problem or both there is a natural specification of the barro model 1 that emphasizes the similarity between this model and optimal growth models see for example david cass 1965 peter diamond 1973 here in steady state equilibrium the aftertax interest rate r must equal the rate at which individuals discount the utility of their heirs p r p has become known as the modified golden rule and a meaningful individual optimization problem requires that p exceed n the natural growth rate of the economy my results confirm barro s hunch about his model in a barro model r must exceed n much of the barro feldstein 1976 interchange which assumed that r could have any relation to n is wrong headed barro and feldstein reach different conclusions about the effects of government debt and social security because they assume different individual utility functions also my results contrast sharply with those of buiter and carmichael for example carmichael concluded that with intergenerational transfers from parents to children bequests r must exceed n but with transfers in the opposite direction n must exceed r 1982 pp 205 06 indeed i believe that the buiter carmichael representation of the barro model is logically faulty see section ii in section i i outline an overlapping generations model with gifts and bequests and derive its steady state properties in the next section i discuss the shortand long run effects of introducing government debt into the model and contrast my results with those

adjustment of consumers durables stocks evidence from automobile purchases this paper tests an optimal s s rule in household durable purchases and examines directly the resulting aggregate expenditure dynamics the observed decision rule responds to income uncertainty and growth as predicted by an s s model resulting from transactions costs tests against liquidity constraints find that about half the households purchase according to an optimal s s rule aggregating the s s rule over households produces a cross section distribution of durables holdings the empirical distribution is similar to that predicted theoretically as is its response to aggregate shocks furthermore simulations of aggregate expenditure based on the household distribution exhibit dynamics consistent with those observed in the 1980s

different trajectories in the social divisions of labour the cutlery industry in sheffield england and tsubame japan to contribute to the growing debate on the social division of labour and its implications for local development this paper comparatively analyses recent trends in the industrial organisation of the cutlery industry in sheffield and tsubame both industries evolved as flexibly specialised export oriented production systems based on a highly interdependent network of small firms in the past 20 years however the social division of labour underlying sheffield s cutlery industry has been much reduced in size and complexity while tsubame has retained and used its social division of labour to adjust towards more value added production the different trajectories of the two systems reflect different approaches to competitiveness in tsubame the emphasis is on innovation while in sheffield the industry has been extremely conservative placing emphasis on minimising costs