democracy visibility and public good provision we examine the role of visibility in influencing government resource allocation across a multiplicity of public goods we show that a visibility effect distorts governmental resource allocation such that it helps explain why governments neglect provision of essential public goods despite their considerable benefits we show that greater democratization widens the gap in resource allocation between more visible such as famine prevention versus less visible such as malnutrition prevention public goods up to an intermediate level of democracy beyond this level this gap decreases furthermore public goods with low visibility are prone to multiple equilibria in resource allocation with voter expectations being shown to be important

the firm in early modern china abstract the chinese shareholding entity had a long history supported by cultural and legal practices pre dating the introduction of european business forms in china in the absence of codified or systematic precedent based private law a culture in which contract was deeply embedded in daily practice and the state enforced private agreements sustained a growing commercial sector kinship practices were adapted to the needs of a merchant community seeking ways to pool capital and sustain firm longevity these institutional developments help to explain chinese adaptability to western practices and the paradoxical persistence of chinese practices after the promulgation of a western style company law

information technology effects on firm performance as measured by tobin s q despite increasing anecdotal evidence that information technology it assets contribute to firm performance and future growth potential of firms the empirical results relating it investments to firm performance measures have been equivocal however the bulk of the studies have relied exclusively on accounting based measures of firm performance which largely tend to ignore it s contribution to performance dimensions such as strategic flexibility and intangible value in this paper we use tobin s q a financial market based measure of firm performance and examine the association between it investments and firm q values after controlling for a variety of industry factors and firm specific variables the results based on data from 1988 1993 indicate that in all of the five years the inclusion of the it expenditure variable in the model increased the variance explained in q significantly the results also showed that for all five years it investments had a significantly positive association with tobin s q value our results are consistent with the notion that it contributes to a firm s future performance potential which a forward looking measure such as the q is better able to capture

the intertemporal stability of the concentration margins relationship using a longitudinal data base we find that there has been a substantial narrowing of the spread between the price cost margins of concentrated and unconcentrated industries including measures of macroeconomic fluctuations into standard price cost margin regressions we find significant differences in cyclical behavior across market structure we also explore a possible explanation unionization for differences in cyclical behavior finally we investigate the degree to which our results are affected by the potential simultaneity of concentration advertising and the price cost margin

the competitive effects of resale price maintenance the competitive effects of resale price maintenance rpm are theoretically diverse rpm can cause allocation distortions or promote productive efficiencies in the distribution process moreover extant cross sectional empirical evidence is incapable of distinguishing among the potentially disparate effects of rpm this paper conducts hypothesis tests of the alternative theories of rpm the empirical framework relates estimates of the effects of rpm for a cross section of observations to necessary conditions of the alternative models this analysis indicates that rpm is used both to foster cartels and promote efficiencies in the distribution process this result is consistent with the growing body of case study analysis that suggests that rpm is used for a variety of reasons this result also questions the current per se illegal status of rpm in the antitrust laws evidence is also provided concerning the strategic interaction between manufacturers and dealers in the distribution process and the use of financial data in analyzing propositions in industrial organization

foreign direct investment theories entry barriers and reverse investments in u s manufacturing industries this paper investigates empirically whether industrial organization oriented fdi theories explain the recent phenomenon of reverse foreign direct investment in the u s based on the distribution of fdi in two digit sic manufacturing industries we find that capital and advertising intensities act as entry barriers to foreign investments in the u s we also observe that foreign multinationals are attracted by the u s market size and that they invest heavily in industries with intensive r d combined with marketing efforts

size and performance of banking firms testing the predictions of theory abstract in recent years two important literatures on the theory of banking firms have developed one examines the economic functions of banks in environments in which agents are asymmetrically informed another considers the incentive effects moral hazard resulting from deposit insurance both theories make predictions about the relation between banking firm size and performance an empirical analysis of large bank holding companies investigates measures of market valuation and risk of failure limited support is provided for either set of theoretical predictions

opportunistic politicians and fiscal outcomes the curious case of vorarlberg using a unique set of electoral rules present in the austrian state of vorarlberg we explore the question ofwhether direct election of the mayor affects the size of local governments using difference in differences estimation and propensity score matching we find evidence that direct elections of the mayor are associated with less expenditure on public administration and public personnel and higher expenditure in the visible categories of spending i e transportation infrastructure and economic subsidies to firms and individuals

voting technology political responsiveness and infant health evidence from brazil this paper studies the introduction of electronic voting technology in brazilian elections estimates exploiting a regression discontinuity design indicate that electronic voting reduced residual error ridden and uncounted votes and promoted a large de facto enfranchisement of mainly less educated citizens estimates exploiting the unique pattern of the technology s phase in across states over time suggest that as predicted by political economy models it shifted government spending toward health care which is particularly beneficial to the poor positive effects on both the utilization of health services prenatal visits and newborn health low weight births are also found for less educated mothers but not for the more educated

local governance and public goods provision in rural china in developing countries identifying the most effective community level governance mode is a key issue in rural development therefore empirical evaluation of these different modes is desperately needed since the 1980s tens of thousands of villages in rural china have held local government elections providing a good opportunity to investigate the effect of democratization on the level of public goods provision using a recent village survey conducted over a significant period of time this article compares two different governance modes it finds that elections affect little on the size of revenue but significantly shift the distribution of taxation from individuals to enterprises if possible however privatization has made taxation or levies on rural enterprises more difficult it also shows that elections and power sharing are conducive to improve the allocation of public expenditures

firm growth and efficiency in the banking industry a new test of the efficient structure hypothesis abstract in this paper we propose a new test of the efficient structure es hypothesis which predicts that efficient firms come out ahead in competition and grow as a result our test has significant advantages over existing ones because it is more direct and can jointly test the so called quiet life hypothesis which predicts that in a concentrated market firms do not minimize costs we then apply this test to large banks in japan consistent with the es hypothesis we find that more efficient banks become larger we also find that market concentration reduces banks efficiency which supports the quiet life hypothesis these findings imply that there is an intriguing growth efficiency dynamic throughout banks life cycle although our findings also suggest that the es hypothesis dominates the quiet life hypothesis in terms of economic impact

the political economy of improving health care for the poor in rural africa institutional solutions to the principal agent problem both governments and private for profit markets have been disappointing in meeting the needs of the african poor for health care ngo services provide a much more attractive alternative for this clientele despite the fees they charge they do so because they represent an institutional solution to the imperfect information problem in health care through simulations based on data from cameroon we demonstrate that if fee charging ngos replace the highly subsidised but poorly managed facilities operated by african governments the poor would be better off those ngos that are decentralised in their financial and personnel management are most effective the politics of making the recommended changes are assessed

radio s impact on public spending if informed voters receive favorable policies then the invention of a new mass medium may affect government policies since it affects who is informed and who is not these ideas are developed in a voting model the model forms the basis for an empirical investigation of a major new deal relief program implemented in the middle of the expansion period of radio the main empirical finding is that u s counties with many radio listeners received more relief funds more funds were allocated to poor counties with high unemployment but controlling for these and other variables the effects of radio are large and highly significant

in pursuit of monopoly power recent quantitative work in industrial economics this paper reviews empirical work in industrial organization devoted to the question of inferring the existence of monopoly power from data on observed market outcomes like profits and prices the discussion covers inter industry work long conventional in the area newer developments in intra industry analysis and case studies and concludes with some remarks on a small but growing body of work assessing market dynamics the wide range of studies reviewed all generally reveal that market power exists in many industries

the political economy of government responsiveness theory and evidence from india the determinants of government responsiveness to its citizens is a key issue in political economy here we develop a model based on the solution of political agency problems having a more informed an politically active electorate strengthens incentives for governments to be responsive this suggests that there is a role both for democratic institutions and the mass media in ensuring that the preferences of citizens are reflected in policy the ideas behind the model are tested on panel data from india we show that public food distribution and calamity relief expenditure are greater controlling for shocks where governments face greater electoral accountability and where newspaper circulation is highest

sics as delineators of economic markets the standard industrial classification sic is often used to divide firms into homogeneous markets firms classified into the same n 1 digit sic are thought to be more homogeneous than firms sharing only the same n digit sic this study measures how well the sic succeeds at combining firms into homogeneous economic markets assuming that firms in more similar economic markets should display more similar sales changes profit rates or stock price changes than firms in less similar economic markets the author finds that the sic is not successful at identifying firms with such similar characteristic variables copyright 1989 by the university of chicago

election goals and income redistribution recent evidence from albania this paper examines the impact of political competition on block grants from federal to sub federal levels of government we model the extent and direction of income redistribution as determined proximately by the political agendas of central decision makers and at a deeper level by the institutions within which they nd themselves operating we contrast two political objective functions that yield di erent empirical predictions of the ways in which politics should a ect scal policy lessons learned here may prove important in understanding limits on the types of redistribution possible via block grants given the institutional framework in both developing and developed countries 2001 elsevier science b v all rights reserved jel classixcation h1 h7 o1

the heart kuznets curve understanding the relations between economic development and cardiac conditions abstract as countries turn wealthier some health indicators such as child mortality seem to have well defined trends however others including cardiovascular conditions do not follow clear linear patterns of change with economic development abnormal blood pressure is a serious health risk factor with consequences for population growth and longevity as well as public and private expenditure in health care and labor productivity this also increases the risk of the population in certain pandemics such as covid 19 to determine the correlation of income and blood pressure we analyzed time series for the mean systolic blood pressure sbp of men s population mmhg and nominal gross domestic product per capita gdppc for 136 countries from 1980 to 2008 using regression and statistical analysis by pearson s correlation r our study finds a trend similar to an inverted u shaped curve or a heart kuznets curve there is a positive correlation increase gdppc increase sbp in low income countries and a negative correlation in high income countries increase gdppc decrease sbp as country income rises people tend to change their diets and habits and have better access to health services and education which affects blood pressure however the latter two may not offset the rise in blood pressure until countries reach a certain income investing early in health education and preventive health care could avoid the sharp increase in blood pressure as countries develop and therefore avoiding the heart kuznets curve and its economic and human impacts

q and the tax bias theory abstract a growing body of literature analyzes the variation in q the ratio of financial market value to asset current replacement cost and makes inferences about attributes such as monopoly power profitability managerial performance etc these studies ignore potential biases embedded in q that result from non neutral tax policies this study examines the association between q and tax biases and establishes that differences in accumulated depreciation tax shields explain significant variation in q the implication that q should be adjusted for tax biases before use in empirical research is examined further adjusting q for tax biases at least with the factors herein leads only to minor changes in econometric analyses

the allocation of publicly provided goods to rural households in india on some consequences of caste religion and democracy abstract what determines the allocation of publicly provided goods to rural households in india although empirically driven this paper draws on the characteristics of india s institutional structure and the implications of existing literature for framing the answer to this question we confront the main empirical implications drawn from this framework with a unique data set which brings together widely used district data with a recently constructed data set on political participation we identify three robust determinants of this allocation process formal and informal characteristics of each state allocation mechanism selectivity in the allocations against muslims and scheduled castes and bureaucratic rules and behavior

electoral accountability and corruption evidence from the audits of local governments we show that political institutions affect corruption levels we use audit reports in brazil to construct new measures of political cor ruption in local governments and test whether electoral account ability affects the corruption practices of incumbent politicians we find significantly less corruption in municipalities where mayors can get reelected mayors with reelection incentives misappropriate 27 percent fewer resources than mayors without reelection incentives these effects are more pronounced among municipalities with less access to information and where the likelihood of judicial punish ment is lower overall our findings suggest that electoral rules that enhance political accountability play a crucial role in constraining politician s corrupt behavior jel d72 k42 017

the political economy of health services provision in brazil abstractwe examine the impact of local politics and voter preferences on the allocation of publicly subsidized the unified and decentralized health care system sus health services across 4 338 counties in brazil sus clinics doctors and nurses per capita are higher in counties with a higher share of uninsured in the population and with higher per capita incomes as is consistent with a probabilistic voting model political participation i e the fraction of the poor who vote and the political power of the mayor his vote share in the last election are associated with more visible health inputs namely clinics and consultation rooms but not with more doctors and nurses