forest dependence and income distribution in a subsistence economy evidence from india abstract we examine an area of northern india where forestry acts to ameliorate the incidence of poverty and destitution though it does not otherwise contribute significantly to the reduction of income inequality the poor would be doubly disadvantaged without common property access to forest products conservation measures entailing curtailment in the right to common access pose a dilemma this issue is explored here

technical change external economies and the porter hypothesis abstract michael porter introduces the idea that environmental regulations may benefit affected firms this paper derives results consistent with porter s hypothesis by employing a general equilibrium framework with a large number of agents external economies of scale in production and discrete changes in technology the model shows that endogenous technical change makes porter s hypothesis feasible however a policy that produces results consistent with porter s hypothesis is not necessarily optimal

cost externalities and corporate diversification abstract this paper examines the optimal time of entry by established firms that strategically exploit cost externalities resulting from experience transfer from their core product line to the entered market established firms may delay entry even under conditions when newborn firms would enter early the paper can also explain other entry scenarios including early diversification at an initial loss into markets that newborn firms would never enter the shape of the experience curve in the entered market strongly affects these differences in scenarios

tax policy and yardstick voting in flemish municipal elections recent theoretical papers develop political agency models in which voters compare tax policy with that in neighbouring jurisdictions in these yardstick competition models voters judge incumbents by comparing their policy with policy in neighbouring jurisdictions this paper reports an analysis of municipal elections in flanders during the period 1982 to 2000 and finds empirical evidence for yardstick voting incumbents are punished for higher tax rates importantly the electoral punishment also depends on tax rates in neighbouring municipalities higher rates in neighbouring municipalities are favourable for the incumbents

does entry size matter the impact of the life cycle and technology on firm survival a wave of empirical studies has recently emerged showing that smaller scale entry is confronted with a lower likelihood of survival than their larger counterparts the purpose of this paper is to examine whether the relationship between size of a firm when entering an industry and the likelihood of survival holds under different technological conditions and across the different stages of the industry life cycle the empirical evidence suggests that the relationship between firm size and the likelihood of survival is shaped by technology and the stage of the industry life cycle while the likelihood of survival confronting small entrants is generally less than that confronting their larger counterparts the relationship does not hold for mature stages of the product life cycle or in technologically intensive products in mature industries that are still technologically intensive entry may be less about radical innovation and possibly more about filling strategic niches thus negating the impact of entry size on the likelihood of survival

the market evolution and sales takeoff of product innovations in contrast to the prevailing supply side explanation that price decreases are the key driver of a sales takeoff we argue that outward shifting supplyand demand curves lead to market takeoff our fundamental idea is that sales in new markets are initially low because the first commercialized forms of new innovations are primitive then as new firms enter actual and perceived product quality improves and prices possibly drop which leads to a takeoff in sales to provide empirical evidence for this explanation we explore the relationship between takeoff times price decreases and firm entry for a sample of consumer and industrial product innovations commercialized in the united states over the past 150 years based on a proportional hazards analysis of takeoff times we find that new firm entry dominates other factors in explaining observed sales takeoff times we interpret these results as supporting the idea that demand shifts during the early evolution of a new market due to nonprice factors is the key driver of a sales takeoff

dynamic entry and exit with uncertain cost positions abstract we study the dynamics of entry and exit based on firms learning about their relative cost positions each firm s marginal cost of production is its own private information thereby facing ex ante uncertainty about its cost position the inelastic market demand can accommodate only a fraction of firms to operate and thus only firms with relatively lower costs are viable in the long run some firms in the market will exit if excessive entry or overshooting occurs we derive the unique symmetric sequential equilibrium the equilibrium properties are consistent with empirical observations i entry occurs gradually over time with lower cost firms entering earlier than higher cost firms ii exiting firms are among the ones that entered later indeed in the last period moreover equilibrium overshooting probability is shown to always be positive and decreasing over time

dynamics of entry and exit of firms in the presence of entry adjustment costs abstract this paper presents a simple model of industry dynamics with entry adjustment costs these costs imply a non instantaneous adjustment path to the steady state so that the model permits the short run and long run characterization of industry dynamics in a single framework the type of the steady state zero entry and exit or positive entry and exit with the co existence of high efficiency and low efficiency firms depends on the fixed cost of entry as well as entry adjustment costs the short run dynamics exhibits non monotonicity if persistence in efficiency over time is not too high the model is consistent with the empirical observations that the total number of firms and net entry follow non monotonic paths and entry and exit are positively correlated over time

delay and cycles when the profitability of investment depends on the general level of economic activity entrepreneurs have an incentive to delay investments during a recession endogenous delay thus prolongs the recovery from a recession and heightens the effect of the boom this paper describes a dynamic model that exhibits both delay and cycles and develops methods for analysing the role of delay in propogating business cycles a number of interesting characteristics of the cycle are revealed first the effect of delay is asymmetric it lengthens the recovery but not the downturn second delay can increase the amplitude and typically reduces the frequency of the cycle third it can reduce the average level of activity but it achieves this effect by prolonging the recession rather than by reducing the amplitude of the cycle the welfare effects of delay are ambiguous however

state responses to fiscal crises the effects of budgetary institutions and politics this paper explores the dynamics of state taxes and spending during the late 1980s when regional economic downturns and increased expenditure demands led to substantial state budget deficits more restrictive state fiscal institutions such as no deficit carryover rules and tax and expenditure limitations are correlated with more rapid fiscal adjustment to unexpected deficits political factors are also important when a single party controls the state house and the governorship deficit adjustment is much faster than when party control is divided in gubernatorial election years tax increases and spending cuts are both significantly smaller than at other times

technological regimes and schumpeterian patterns of innovation this paper proposes that the specific pattern of innovative activities in an industry can be explained as the outcome of different technological learning regimes a technological regime is defined by the particular combination of technological opportunities appropriability of innovations cumulativeness of technical advances and properties of the knowledge base building upon the distinction between schumpeter mark i and schumpeter mark ii industries this paper provides empirical estimates of the relationships between indicators of the schumpeterian patterns of innovation concentration of innovative activities stability in the hierarchy of innovators and importance of new innovators and indicators of the variables defining technological regimes

influence of social learning on exchange rate policy in developing countries a preliminary finding by using a suitable econometric model this study shows that beyond factors postulated by theorists social learning is a very powerful phenomenon for guiding developing countries in their exchange rate policy we introduce two variables that fairly encapsulate features of learning among neighbours the new variables together with those advanced in theory are then used to determine choice of a managed float by analysing 1993 cross section data from asian developing countries

the two views of small firms in industry dynamics a reconciliation abstract recent empirical studies show that small firms are confronted with a lower likelihood of survival than their larger counterparts an alternative view is that small firms can overcome inherent size disadvantages by occupying strategic niches this paper offers empirical evidence in the context of product life cycles suggesting that the relationship between firm size and the likelihood of survival is shaped by the stage of the industry life cycle and that both views of small firm survival relative to large firms are correct

technology shocks and job flows we consider a version of the solow growth model where technological progress can be investment specific or investment neutral the labour market is subject to search frictions and the existing productive units may fail to adopt the most recent technological advances technological progress can lead to the destruction of technologically obsolete jobs and cause unemployment we calibrate the model to replicate the high persistence that characterizes the dynamics of firms neutral technology and the frequency of firms capital adjustment we find that neutral technological advances increase job destruction and job reallocation and reduce aggregate employment investment specific technological advances reduce job destruction have mild effects on job creation and are expansionary hence neutral technological progress prompts schumpeterian creative destruction while investment specific technological progress operates essentially as in the standard neoclassical growth model using structural var models we provide support to the key dynamic implications of the model copyright 2007 wiley blackwell

do budget maximizing public officials increase the probability of property reassessment county governments in pennsylvania face non binding limits on their property tax rates these are considered non binding because they do not place a limit on tax levies or expenditures assuming local public officials have monopoly power tax rate limits can be circumvented by reassessing the property tax base a two stage process was hypothesized in which the probability of reaching tax rate limits first was determined and the probability of reassessment then was determined the effect of budget maximizing government officials at each stage was tested for 66 pennsylvania counties over the 1970 1995 period the empirical results showed that variables associated with budget maximizing behaviour influenced the choice in each stage public expenditure growth increased the probability of reaching the tax rate limit in the first stage while reaching the tax rate limit increased the probability of reassessment in the second stage the estimates also showed that economic fiscal and taste variables were signific

bridging behavioral and economic theories of decline organizational inertia strategic competition and chronic failure this paper is another plea for bridging behavioral and economic approaches to the study of competition in markets and strategy making by firms the arguments focus on a specific case in point the behavioral theory of organizational decline and the economic modeling of immediate exit the arguments come in three steps first the literature on organizational decline is reviewed by organizing a framework that summarizes arguments from varying economic and organizational perspectives that have for the most part developed independently observations from empirical and theoretical studies are combined in order to investigate the causes conditions courses and consequences of organizational downturn second a theoretical argument is developed that explains voluntary exit and chronic failure by introducing a proxy of organizational inertia in a model of strategic cournot duopoly the key assumptions which have a behavioral flavour that seemingly contradicts orthodox economics are grounded in the theoretical and empirical literatures the results of the model support the claim that pure profit maximizing behavior may be at the expense of organizational survival d aveni 1990 p 135 third by formulating two hypotheses and presenting tentative evidence from the chemical industry the paper hopes to convincingly argue that such integrative models lead to empirical testing of interesting hypotheses a key finding here is that inefficient firms may outlast their efficient rivals cf d aveni 1989a

new hampshire s tax base limits an example of the leviathan model this study views the lack of an income tax on wages and salaries and a general sales tax in new hampshire as tax base limits i use the leviathan model to analyze the differences between the fiscal system in new hampshire and the fiscal systems in vermont maine and massachusetts vermont maine and massachusetts do not have the tax base limits that new hampshire has from 1957 to 1989 new hampshire had lower state and local government tax and expenditure levels than the other three states more rapid population growth lower welfare expenditures but comparable levels of expenditures for several of the major public services and a more competitive structure of state and local government

technology diffusion and international income convergence abstract a macroeconomic model of international income convergence driven by differences in technology is presented ldc firms adopt foreign technology by paying an upfront cost of adaptation and early adopters create a positive externality for followers in equilibrium adoption is gradual and so is income convergence because of the externality small differences in adoption costs across ldcs can lead to large differences in long run income during convergence the ldc economy is dualistic with large high technology firms operating alongside small traditional establishments the effects of trade policy and direct foreign investment are also examined

intra plant diffusion of new technology role of productivity in the study of steel refining furnaces abstract this paper examines intra plant diffusion of new technology in the japanese steel industry the introduction of the basic oxygen furnace bof was the greatest breakthrough in steel refining in the last century using unique panel data the paper estimates total factor productivity by technology type and associates the estimates with intra plant diffusion the paper finds that intra plant diffusion accounts for about a half of the industry productivity growth large plants are likely to adopt the new technology earlier but retain the old technology longer than their smaller counterparts

uncertainty risk and incentives theory and evidence uncertainty has qualitatively different implications than risk in studying executive incentives we study the interplay between profitability uncertainty and moral hazard where profitability is multiplicative with managerial effort investors who face greater uncertainty desire faster learning and consequently offer higher managerial incentives to induce higher effort from the manager in contrast to the standard negative risk incentive trade off this learning by doing effect generates a positive relation between profitability uncertainty and incentives we document empirical support for this prediction this paper was accepted by wei jiang finance

vintage human capital growth and the diffusion of new technology we develop a model of vintage human capital in which each technology requires vintage specific skills we examine the properties of a stationary equilibrium for our economy the stationary equilibrium is characterized by an endogenous distribution of skilled workers across vintages the distribution is shown to be single peaked under general conditions there is a lag between the appearance of a technology and its peak usage a phenomenon known as diffusion an increase in the rate of exogenous technological change shifts the distribution of human capital to more recent vintages thereby increasing the diffusion rate

on industry life cycles delay entry and shakeout in beer brewing abstract this paper proposes a new explanation for industry shakeout an event evident in the life cycle of many industries in which the number of firms drops significantly in a short interval of time based on an in depth analysis of the shakeout in the united states beer brewing industry between 1880 and 1890 we propose that industry shakeouts naturally follow periods of mass entry by firms similar patterns are evident in two other industries we briefly examine the us automobile and tire industries while entry rates fluctuate broadly in all these industries we find that the timing of exit for a given cohort of entrants is remarkably similar over time the exit hazard rate is peaked in the first two years of every cohort s life and drops dramatically to low and stable levels for subsequent ages in this sense mass exit follows mass entry and does not require a deep explanation it is the mass entry evident in the data for these industries that requires an explanation we propose a theoretical model of information accumulation to explain entry into an industry entrepreneurs are uncertain about the profitability of the industry and this uncertainty is resolved through sufficient accumulation of information regarding the fortunes of incumbent firms delay in entry occurs solely due to the fact that it takes time to accumulate sufficient information to support more entry the resulting entry pattern from simulations of the model looks much like that observed in the industries we study

the impact of migration on rural poverty and inequality a case study in china large numbers of agricultural labor moved from the countryside to cities after the economic reforms in china migration and remittances play an important role in transforming the structure of rural household income this article examines the impact of rural to urban migration on rural poverty and inequality in a mountainous area of hubei province using the data of a 2002 household survey since migration income is a potential substitute for farm income we present counterfactual scenarios of what rural income poverty and inequality would have been in the absence of migration our results show that by providing alternatives to households with lower marginal labor productivity in agriculture migration leads to an increase in rural income in contrast to many studies that suggest that the increasing share of nonfarm income in total income widens inequality this article offers support for the hypothesis that migration tends to have egalitarian effects on rural income for three reasons 1 migration is rational self selection farmers with higher expected return in agricultural activities and or in local nonfarm activities choose to remain in the countryside while those with higher expected return in urban nonfarm sectors migrate 2 households facing binding constraints of land supply are more likely to migrate 3 poorer households benefit disproportionately from migration

let s get real a factor analytical approach to disaggregated business cycle dynamics this paper develops a method for analysing the dynamics of large cross sections based on a factor analytic model we use law of large numbers arguments to show that the number of common factors can be determined by a principal components method the economy wide shocks can be identified by means of simple structural var techniques and that the parameters of the unobserved factor model can be estimated consistently by applying ols equation by equation we distinguish between a technological and a non technological shock identification is obtained by minimizing the negative realizations of the technology shock empirical results on 4 digit industrial output and productivity for the u s economy from 1958 to 1986 show that 1 at least two economy wide shocks both having a long run effect on sectoral output are needed to explain the common dynamics 2 although the technological shock accounts for at least 50 of the aggregate dynamics of output it cannot by itself explain dynamics at business cycle frequencies 3 sector specific shocks explain the main bulk of total variance but generate mainly high frequency dynamics 4 both the technological and the non technological component of output show a peak for positive sectoral comovements of output at business cycle frequencies 5 technological shocks are strongly correlated with the growth rates of the investment in machinery and equipment sectors and their inputs many interesting questions about cyclical fluctuations and economic growth can be answered only by studying the dynamic behaviour of sectoral variables when data contain information on time for a large cross section of sectors traditional econometric techniques used in the macroeconomic literature such as vector autoregressive var and vector autoregressive moving average varma models are not appropriate since they require the estimation of too many parameters this is why new methods which allow for the reduction of the parameter space need to be developed the objective of this paper is both methodological and descriptive at the methodological level we develop a simple framework for the dynamic analysis of large cross sections the basic model is a dynamic factor analytic model as in sargent and sims 1977 the sectoral variables are decomposed into two unobservable components a common component driven by macroeconomic shocks and a purely sectoral component when

non farm income and inequality in rural pakistan a decomposition analysis this article uses three year panel data to analyse the impact of non farm income on income inequality in rural pakistan after pinpointing the importance of rural non farm income for the poor the article decomposes total rural income among five sources non farm agricultural livestock rental and transfer this decomposition shows that non farm income represents an inequality decreasing source of income the study then decomposes the sources of non farm income this analysis reveals that while non farm unskilled labour income has an equalising effect on income distribution non farm government income has a disequalising effect

timing and quality decisions for entrepreneurial product development abstract an entrepreneur is developing a new product and each period must decide whether to enter the market or to continue development we formulate a model of this decision for ventures facing diminishing returns to product quality and for which funding availability product development success and market competition growth are uncertain we characterize the profit maximizing time to stop product development and enter the market and then show how this stopping time is affected by changes in the business environment by further focussing our modeling assumptions we are able to translate our time based criteria into product quality terms we propose that management set a target quality level that the product must meet in order for the venture to maximize profit we also demonstrate that management should decrease this target and hence the quality of the final product over time and adjust it to respond to changes in the business context

is the first to market the first to fail empirical evidence for industrial goods businesses abstract when entering a new market the first entrant typically faces the greatest market and technological uncertainties memorable phrases reflect the associated survival risk such as the first to market is the first to fail and the pioneer is the one with the arrows in its back although research estimates the market pioneer s survival rate the typical pioneer survival rate has not been compared with that of early followers the authors study compares survival rates for 167 first entrant market pioneers versus 267 early followers for these industrial goods businesses 66 of the pioneers versus 48 of the early followers survived at least ten years the main conclusion is that the pioneer s temporary monopoly over the early followers plus its first mover advantages typically offset the survival risks associated with market and technological uncertainties these results are consistent with previous research in the sense that first mover advantages that increase a pioneer s market share also hel

r d induced industry polarization and shake outs abstract we consider the standard two stage game of r d and cournot competition with ex ante identical firms but depart from the literature in assuming that r d is characterized by mildly instead of strongly decreasing returns to scale we establish that only extreme r d levels are possible at equilibrium and that for a broad range of parameters equilibria are asymmetric in r d levels possibly leading one firm to endogenously exit this provides a simple link between returns to scale in r d and industry polarization including shake outs a novelty is that exit may be triggered by positive opportunities in a strategic setting given the original nature of our r d equilibrium a complete welfare analysis is conducted including a possible role for r d subsidies

effect of modern rice varieties and irrigation on household income distribution in nepalese villages abstract since high yielding modern rice varieties mvs are adopted only in favorable production environments significant regional productivity differentials have emerged in nepal this study explores the distributional consequences of such differential mv adoption based on an intensive survey of favorable and unfavorable villages we found that mv adoption increased returns to land but decreased family labor earnings from rice production as it facilitated the substitution of hired for family labor as a result the differential mv adoption did not significantly worsen the household income distribution according to the results of the counterfactual gini decomposition analysis

the power to tax analytical foundations of a fiscal constitution preface 1 taxation in constitutional perspective 2 natural government a model of leviathan 3 constraints on base and rate structure 4 the taxation of commodities 5 taxation through time income taxes capital taxes and public debt 6 money creation and taxation 7 the disposition of public revenues 8 the domain of politics 9 open economy federalism and taxing authority 10 toward authentic tax reform prospects and prescriptions epilogue notes selected bibliography index

evolutionary trends of industry variables abstract the paper offers empirical evidence on the evolutionary trends of industry variables it investigates the time path of patents product price and quantity and number of firms from the first introduction of a product to maturity of the market the paper extends earlier work by gort and klepper by expanding the data on products through 1991 and augmenting it with new products and new data sources the reexamination of the aging patterns reveal the gort and klepper results to be robust the time trends follow the expected patterns with remarkable consistency and are strongly significant for most products new evidence on patenting activity reveal an eventual decline in technological activity over the later years of the product market life cycle

frictionless technology diffusion the case of tractors many new technologies display long adoption lags and this is often interpreted as evidence of frictions inconsistent with the standard neoclassical model we study the diffusion of the tractor in american agriculture between 1910 and 1960 a well known case of slow diffusion and show that the speed of adoption was consistent with the predictions of a simple neoclassical growth model the reason for the slow rate of diffusion was that tractor quality kept improving over this period and more importantly that only when wages increased did it become relatively unprofitable to operate the alternative laborintensive horse technology jel l62 n51 n52 n71 n72 o33 q11 understanding the determinants of the rate at which new technologies are created and adopted is a critical element in the analysis of growth even though modeling equilibrium technology creation can be somewhat challenging for standard economic theory understanding technology adoption should not be specifically once the technology is available the adoption decision is equivalent to picking a point on the appropriate isoquant dynamic considerations make this calculation more complicated but they still leave it in the realm of the neoclassical model a simple minded application of the theory of the firm suggests that profitable innovations should be adopted instantaneously or with some delay depending on various forms of cost of adjustment the evidence on the adoption of new technologies seems to contradict this prediction jovanovic and lach 1997 report that for a group of 21 innovations it takes 15 years for its diffusion to go from 10 percent to 90 percent the 10 90 lag they also cite the results of a study by grubler 1991 covering 265 innovations who finds that for most diffusion processes the 10 90 lag is between 15 and 30 years 1

property tax revaluation and tax levy growth abstract jurisdiction wide property revaluation like many administrative reforms may have unintended consequences this paper examines one such potential consequence by pooling 18 year time series for each of 39 massachusetts cities 17 of which revalued and 270 massachusetts towns 202 of which revalued we examine the hypothesis that politicians take advantage of the confusion generated by revaluation and raise property taxes by more than they otherwise would have we observe such a response in cities but not in towns and attribute this difference to differences in their governmental structures

entry exit and diffusion with learning by doing early entry has the advantage of higher revenues per unit of output early on late entry has the benefit of learning from the experience of earlier entrants and hence lower production costs the advantages are balanced off in a continuous time perfect foresight equilibrium competition generates s shaped diffusion and staggered entry and exit a monopolist will innovate less than a competitive industry but the innovation that he does do he will do sooner copyright 1989 by american economic association

infrequent assessments distort property taxes theory and evidence abstract economists have long recognized that lags in property reassessment benefit infrequent movers because it reduces their property taxes but in addition reassessment lags can influence the level of property taxes selected under majority rule i show that short delays in community wide reassessment increase property tax collections because it reduces the tax price for a majority of voters however longer delays reduce property tax collections because the aggregate assessed base and thus the tax yield declines so much i formally characterize the cutoff between these regimes and show tax collections are generally above their socially optimal level this theory can help explain why many people believe property taxes are excessive and it also suggests that the american system of taxing capital gains at realization rather than on accrual might result in excessive rates i test this theory on a sample of pennsylvania municipalities in the philadelphia suburbs this is a suitable crucible for such an evaluation because community wide reassessments are infrequently performed in pennsylvania it is not possible to reject the theory s basic predictions and numerical estimates suggest that a 5 year delay in community wide reassessment increases government revenues by 6 however reassessment delays do not impose statistically significant social losses because they benefit infrequent movers

shakeouts and market crashes this article provides a microfoundation for the rise in optimism that seems to precede market crashes small young markets are more likely to experience stock price run ups and crashes we use a zeira rob type of model in which demand size is uncertain optimism then grows rationally if traders prior distribution over market size has a decreasing hazard such prior beliefs are appropriate if most new markets are duds and only a few reach a large size the crash occurs when capacity outstrips demand as an illustration for the period 1971 2001 we fit the model to the telecom sector

models of technology diffusion abstract the literature on new technology diffusion is vast and it spills over many conventional disciplinary boundaries this paper surveys the literature by focusing on alternative explanations of the dominant stylized fact that the usage of new technologies over time typically follows an s curve the most commonly found model which is used to account for this model is the so called epidemic model which builds on the premise that what limits the speed of usage is the lack of information available about the new technology how to use it and what it does the leading alternate model is often called the probit model which follows from the premise that different firms with different goals and abilities are likely to want to adopt the new technology at different times in this model diffusion occurs as firms of different types gradually adopt it there are actually many ways to generate an s curve and the third class of models which we examine are models of density dependence popularized by population ecologists in these models the twin forces of legitimation and competition help to establish new technologies and then ultimately limit their take up finally we look at models in which the initial choice between different variants of the new technology affect the subsequent diffusion speed of the chosen technology such models often rely on information cascades which drive herd like adoption behaviour when a particular variant is finally selected

a dynamic general equilibrium analysis on fostering a hydrogen economy in korea hydrogen is anticipated to become one of the major alternative energy technologies for a sustainable energy system this study analyzes the dynamic economic impacts of building a hydrogen economy in korea employing a dynamic computable general equilibrium cge model as a frontier technology hydrogen is featured as having a slow diffusion rate due to option value positive externality resistance of old technology and complementary vintages without government intervention hydrogen derived energy will supply up to 6 5 of final energy demand by 2040 simulation outcomes show that as price subsidy rates increase by 10 20 and 30 hydrogen demand will increase by 9 2 15 2 and 37 7 respectively of final energy demand by 2040 the output of the transportation sector will increase significantly while demands for oil and electricity will decline demands for coal and lng will experience little change household consumption will decline because of the increase of income taxes overall gdp will increase because of the increase in exports and investments co2 emission will decline for medium and high subsidy rate cases but increase for low subsidy cases ultimately subsidy policy on hydrogen will not be an effective measure for mitigating co2 emission in korea when considering dynamic general equilibrium effects

the life cycle of a competitive industry firm numbers first rise then later fall as an industry evolves this nonmonotonicity is explained using a competitive model in which innovation opportunities fuel entry and relative failure to innovate prompts exit equilibrium time paths for price and quantity also share features of the data the model is estimated using data from the u s automobile tire industry a particularly dramatic example of the nonmonotonicity in firm numbers

industry competition and firm human capital this paper argues that objective and subjective human capital may have substantial impact upon organizational performance in a competitive context objective human capital pertains to such features as education and experience whereas subjective human capital relates to personality characteristics the argument is illustrated by presenting the results of two empirical studies 1 a cross section 1990 1991 analysis of about 50 incumbents in the flemish furniture industry concentrating on the impact of subjective human capital particularly the chief executive officer s ceo s locus of control personality on financial performance and 2 a longitudinal 1970 1992 analysis of a cohort of 100 entrants into the dutch audit industry focusing on the influence of objective human capital particularly education and experience on exit by merger and acquisition m a or diaspora both studies support the claim that objective and subjective human capital matters for example flemish furniture firms headed by a ceo with an internal locus of control trait reach higher levels of financial performance and dutch audit firms with a high proportion of personnel with business experience are more likely to exit the industry over the years as a result of diaspora finally the data of the flemish furniture and dutch audit industries are re analyzed so as to compare the impact of human capital variables on small firm performance in both industries this re analysis reveals that in both industries the impact of human capital variables is more pronounced in large firms compared to small businesses

when shakeout doesn t occur the evolution of the turboprop engine industry abstract a careful case study of the history of the turboprop engine industry 1948 1997 is offered as an example of non shakeout pattern the persistence of high concentration is not associated with the exit of smaller manufacturers but instead a stable coexistence of generalist and specialist strategies emerges in sharp contrast to the pattern observed in the otherwise similar jet engine industry this paper identifies the relevant variables of a more general theory of industry life cycle by taking into account the lack of creation of significant increasing returns in r d manufacturing or marketing all of which are commonly found in industries that produce systemic products

a dynamic model of entry and exit in a growing industry the potential demand in a new industry evolves over time demand is initially low but advertising by the industry s early entrants can speed up demand growth however there is intrinsic uncertainty of the demand level in each period and uncertainty of the demand evolution path which can be affected by the underlying economic environment we construct a dynamic model that features the stochastically and endogenously expanding demand of a new industry and we investigate the optimal entry and exit behavior of firms as the industry evolves we find that firms incentive to enter early depends critically on the cost that early entrants have to pay in developing the market when the cost is high and the benefit spills over to potential entrants firms have an incentive to wait and the probability of entry can increase with the number of incumbents under certain circumstances firms entry strategy is also influenced by the transition of economic states firms are more likely to enter under a state that shows the prospect of demand taking off soon we also find that in the early stage of an industry higher demand uncertainty can induce faster entry

agenda control by budget maximizers in a multi bureau setting while the present extension of the single issue model of agenda control has permitted the examination of a wide array of questions within a consistent overall framework and has generated new insights some qualifications are in order first the analysis like niskanen s and romer and rosenthal s is strictly limited to one form of agenda control take it or leave it offers made relative to some reversion level second each of the bureaus in this extension are single activity bureaus as a result certain types of agenda control that might exist when there are several dimensions to each bureau s activity such as the mix chosen for various sub activities or the spatial distribution of the bureau s output are ignored see denzau and mackay 1980 and mackay and weaver 1979a b for analyses of these types of agenda control for the case of a single bureau third as a point of reference and for expositional simplicity the analysis for the most part was executed with a single decisive voter on all issues as a result certain complexities and perhaps additional ambiguities were avoided finally in an effort to isolate and study the effects of the supply side phenomenon of agenda control a simple traditional model of the demand side of the collective choice process was employed for the simplest demand side passive supply side models this has typically proved quite adequate as models of the collective choice process have become more complex however taking on more strategic features the weaknesses of certain of the standard assumptions implicit in this demand side model become more apparent in particular the assumption that voters vote sincerely and non strategically is likely to be strained by most specifications of the dynamics of the voting process since learning on the part of voters would condition expectations and perhaps alter choice the inclusion of expectations formation into the model of voter behavior would certainly seem at least at the intuitive level to introduce an interesting additional set of constraints on agenda setters that may limit to some extent the expansionary tendencies described in this paper in short each of these qualifications should provide fertile ground for future research