germany s dash for coal exploring drivers and factors abstract the german electricity sector has recently seen extensive planning and construction of new coal fired power plants within a period of only a few years new investments amounting to around 15 of the total sector capacity were brought on the way and plans for a multitude of additional projects are pending this dash for coal in germany has raised considerable public concern especially as it risks to undermine recent political attempts to combat global warming yet the question of why the dash for coal has emerged has not yet been addressed in a thorough analysis this article attempts to close this research gap while at the same time contributing as a case study to the general understanding of investment patterns in liberalized electricity markets it finds that the main reasons for the dash have been 1 replacement requirements due to the nuclear phase out 2 the onset of a new investment cycle in the power market 3 favorable economic and technological prospects for coal compared with natural gas in the long run 4 a status quo bias of investors in regard to future renewable deployment 5 explicit political support for coal and 6 the ineffectiveness of public protest in hampering new projects

optimal product launch times in a duopoly balancing life cycle revenues with product cost we present a model describing the demand dynamics of two new products competing for a limited target market the demand trajectories of the two products are driven by a market saturation effect and an imitation effect reflecting the product experience of previous adopters in this general setting we provide analytical results for the sales trajectories and life cycle sales of the competing products we use these results to study the impact of launch time on overall life cycle sales we consider the perspective of one of the competing products and model the trade off between the lost revenues resulting from a delayed launch and the lower unit production costs we find that the profit maximizing launch time exhibits a counterintuitive behavior in particular we show that a firm facing a launch time delay from a competing product might benefit from accelerating its own product launch as opposed to using the softened competitive situation to further improve its cost position we identify conditions under w

considerations on providing the energy needs using exclusively renewable sources energiewende in germany abstract the share of renewables in the primary energy demand of germany has increased from 1 3 in 1990 to 11 7 in 2013 the plans are to increase it further by the year 2050 to 50 or even 100 by carrying out the national energiewende energy change switch programme in this paper we analyze the current energy scenario and recall goals of the energiewende programme we also identify infrastructural and technological bottlenecks which are likely to affect the programme execution by doing so the enormous scale of this national venture becomes apparent and it is clear that its execution will last for several generations and perhaps even for a century or two additionally we introduce an idea of exclusively green energy communities egecs as an energiewende mile stone due to the dimensions of the tasks the energy change switch programme will last for several generations and perhaps even for a century or two realization of this overwhelming national venture has to proceed through milestones and demonstration projects we propose demo projects called green energy communities gecs to examine with what efforts and under what constraints such communities can operate using exclusively renewable forms of energy

pricing and green level decisions of a green supply chain with governmental interventions under fuzzy uncertainties abstract environmental issues make green manufacturing become inevitable and fuzzy uncertainty prevails in supply chain management in order to further promote the development of green supply chain according to channel leadership scenario we develop three game models of a green supply chain with governmental interventions under fuzzy uncertainties of both manufacturing cost and consumer demand we study how prices green levels and expected profits are influenced by channel leadership and governmental interventions green level sensitivity and fuzzy degree of parameters are considered analytical results indicate that manufacturer stackelberg scenario is the inferior structure than other scenarios and retailer stackelberg scenario is superior to other scenarios for all players under the strong governmental interventions then when governmental interventions increase the green level will increase but the tendency of retail price depends on channel leadership governmental interventions are not always beneficial to the green supply chain and the manufacturer further although the government s subsidy is offered to the manufacturer the retailer benefits from it ultimately and further becomes the main puller of the development of green products in addition a relatively high green level floor for subsidy results in the manufacturer s first mover disadvantage

debt in industry equilibrium this article shows 1 how entry and exit of firms in a competitive industry affect the valuation of securities and optimal capital structure and 2 how given a trade off between tax advantages and agency costs a firm will optimally adjust its leverage level after it is set up we derive simple pricing expressions for corporate debt in which the price elasticity of demand for industry output plays a crucial role when a firm optimally adjusts its leverage over time we show that total firm value comprises the value of discounted cash flows assuming fixed capital structure plus a continuum of options for marginal increases in debt article published by oxford university press on behalf of the society for financial studies in its journal the review of financial studies

towards improved policy processes for promoting innovation in renewable electricity technologies in the uk this paper analyses recent current and potential future relations between policy processes and substantive outcomes in uk low carbon innovation policy focussing on policies relating to renewable electricity generation technologies it examines the development of policy processes relating to the adoption and implementation of the renewables obligation and how these may affect the current and likely future success of the obligation in promoting low carbon innovation it examines the new policy and institutional processes put in place in the 2003 energy white paper and argues that these are unlikely to provide the strategic long term framework needed to realise the ambitious goals for uk energy policy set out in the white paper finally it outlines some suggestions for further development of policy processes to facilitate improved delivery of these goals based on guiding principles for sustainable innovation policy processes developed by the authors and their colleagues

de regulated electric power markets and operating nuclear power plants the case of british energy abstract one issue addressed in almost all electric power restructuring de regulation plans in both the united states us and the united kingdom uk was the recovery of operating nuclear power plant s spent fuel disposal costs and the expenditures to decommission the units when they are retired prior to restructuring in theory at least in both countries electricity consumers were paying for the back end costs from operating nuclear power plants moreover in virtually all cases in the us states included special provisions to insure that consumers would continue to do so after power markets were de regulated when power markets in the uk were initially restructured de regulated and nuclear power privatized the shareholders of british energy be were initially responsible for these costs however after electricity prices fell and be collapsed the british government shifted many of the costs to future taxpayers as much as a century forward if this was not done the book value of be s equity would have been about 3 5 billion pounds that is be s liabilities would have been about 3 5 billion pounds greater than their assets it is difficult to see how be could remain viable under such circumstances

assessing the need for critical minerals to shift the german energy system towards a high proportion of renewables abstract the german government has set itself the target of reducing the country s ghg emissions by between 80 and 95 by 2050 compared to 1990 levels alongside energy efficiency renewable energy sources are set to play the main role in this transition however the large scale deployment of renewable energies is expected to cause increased demand for critical mineral resources the aim of this article is therefore to determine whether the transformation of the german energy system by 2050 energiewende may possibly be restricted by a lack of critical minerals focusing primarily on the power sector generating transporting and storing electricity from renewable sources for the relevant technologies we create roadmaps describing a number of conceivable quantitative market developments in germany estimating the current and future specific material demand of the options selected and projecting them along a range of long term energy scenarios allows us to assess potential medium or long term mineral resource restrictions the main conclusion we draw is that the shift towards an energy system based on renewable sources that is currently being pursued is principally compatible with the geological availability and supply of mineral resources in fact we identified certain sub technologies as being critical with regard to potential supply risks owing to dependencies on a small number of supplier countries and competing uses these sub technologies are certain wind power plants requiring neodymium and dysprosium thin film cigs photovoltaic cells using indium and selenium and large scale redox flow batteries using vanadium however non critical alternatives to these technologies do indeed exist the likelihood of supplies being restricted can be decreased further by cooperating even more closely with companies in the supplier countries and their governments and by establishing greater resource efficiency and recyclability as key elements of technology development

advertising as information an empirical note lamm r mcfall unionism and prices in the food retailing industry journal of labor research 3 winter 1982 69 79 marion bruce w willard f mueller ronald w cotterill frederick e geithman and john r schmelzer the food retailing industrv market structure profits and prices new york praeger 1979a the price and profit performance of leading food chains a merican journal of a gricultural economics 61 aug 1979b 420 433 salinger michael a tobin s q unionization and the concentration profits relationship rand journal of economics 15 summer 1984 159 170 voos paula b and lawrence r mishel the union impact on profits evidence from the supermarket industry working paper no 88 north central project 117 university of wisconsin madison oct 1985 the union impact on profits evidence from industry price cost margin data journal of labor economics 4 jan 1986 105 133

forecasting the impact of renewable energies in competition with non renewable sources abstract the diffusion dynamics of traditional and clean energy systems in the energy mix are studied in a competition modeling where their interacting life cycles are jointly described competition has only been considered recently since diffusion competition models are not easy to be implemented data are represented by yearly consumptions in mtoe of traditional sources coal oil gas and nuclear systems and a selection of renewable sources hydroelectric wind and solar power for the us europe china and india from 1965 to 2014 for each case we will investigate whether the diffusion level of traditional sources sustains or prevents the spread of renewables and vice versa for the us and europe we will take into account the link between the 2008 2009 financial crisis and the slowdown in consumptions as a matter of fact the energy sector is characterized by uncertainty due to the depletion of finite energy sources the technological and economical problems of renewables and the hypothesis of shale gas as a possible bridge to renewables that could delay the spread of latter ones in this scenario six year forecasts are provided until 2020

nonlinear production path and an alternative reserves estimate for south asian natural gas abstract natural gas is a finite resource that may be estimated directly through geophysical methodologies or indirectly through historical production data the rapid growth in consumption of this limited natural resource strictly connected to the oil economy may lead to its imminent depletion and a related economic crisis the transition to a new economy based on renewable and sustainable energy resources is a crucial challenge for the next decades at world and regional levels with different dynamics therefore an accurate forecast of the availability of natural gas is important to ensure a sustainable energy policy providing essential information about the timing of this transition postulating a finite life cycle of recoverable resources in this paper we investigate the natural gas production of four neighboring south asian states bangladesh india myanmar and pakistan we use a number of homogeneous diffusion models with convenient extensions and check the model validation in terms of prediction capability the results indicate that india and myanmar have already extracted more than 50 of their ultimately recoverable natural gas resources urr whereas good prospects for natural gas extraction remain in the near future for bangladesh and pakistan the four neighboring asian states can build a sustainable power reserve system for natural gas to meet their increasing demand within a medium term horizon some further policy implications are also suggested in this paper

deceleration of economic growth the main course seeking sustainability in developed countries abstract deceleration of economic growth is a characteristic feature of developed countries percentage gross domestic product gdp growth rate in the old organization for economic co operation and development oecd countries has decreased approximately 2 3 times over the last 50 years and countries have managed successfully to adopt this trend the largest reduction of gdp growth rate was observed in countries such as japan where the biocapacity exceedance was the largest in addition the analysis of long term changes of gdp and self reported life satisfaction in developed countries supports easterlin s paradox indicating that richer people do not feel more satisfied with their lives however people from countries with higher per capita gdp feel more satisfied at the same time a statistically insignificant correlation was detected between gdp growth rate and life satisfaction supporting a conclusion that in the developed countries further economic growth does not increase people s well being this suggests that decelerating the rate of economic growth gradually approaching the zero growth steady state phase is the natural way towards sustainability and it does not contradict the well being objective in developed countries especially ones with high biocapacity exceedance

the german energy transition modeling competition and substitution between nuclear power and renewable energy technologies abstract this paper studies some quantitative aspects of the energy transition in germany the energiewende which envisages the complete abandonment of nuclear power and a strong reliance on photovoltaic and wind energy for electricity provision the major aim is to shed light on and measure with indirect tools the possible social effects on competition and substitution dynamics characterizing such transition in doing so an analysis on the innovation diffusion framework is proposed through the application of two diffusion models for a duopolistic competition unrestricted and standard ucrcd to the annual time series of consumption of nuclear and renewables wind and solar energy in germany in order to test empirically the presence of such substitution effect the obtained results confirm this conjecture and show that renewables have exerted a significant and measurable effect in determining the observed decline of nuclear power consumption in particular we find that the diffusion of renewables wind and solar is characterized by a high within word of mouth testifying the widespread belief of germans towards the energy transition while the parallel diffusion of nuclear power is characterized by a highly negative cross word of mouth due to the competing role exerted by renewables

the enactment of socio technical transition pathways a reformulated typology and a comparative multi level analysis of the german and uk low carbon electricity transitions 1990 2014 abstract this paper aims to make two contributions to the sustainability transitions literature in particular the geels and schot 2007 res policy 36 3 399 transition pathways typology first it reformulates and differentiates the typology through the lens of endogenous enactment identifying the main patterns for actors formal institutions and technologies second it suggests that transitions may shift between pathways depending on struggles over technology deployment and institutions both contributions are demonstrated with a comparative analysis of unfolding low carbon electricity transitions in germany and the uk between 1990 2014 the analysis shows that germany is on a substitution pathway enacted by new entrants deploying small scale renewable electricity technologies rets while the uk is on a transformation pathway enacted by incumbent actors deploying large scale rets further analysis shows that the german transition has recently shifted from a stretch and transform substitution pathway to a fit and conform pathway because of a fightback from utilities and altered institutions it also shows that the uk transition moved from moderate to substantial incumbent reorientation as government policies became stronger recent policy changes however substantially downscaled uk renewables support which is likely to shift the transition back to weaker reorientation

testing for unit roots in panel data are wages on different bargaining levels cointegrated theoritical considerations suggest that spillover forces equalize wages for similar jobs thus it is expected that firm wages are cointegrated with the corresponding wage rates on an industrial level in this paper we apply various unit root tests to a panel of wage data we show that the familiar techniques can be adopted to this type of data allowing for unobserved heterogeneity and common time effects our results suggest that firm and industry wages both possess a unit root in the autoregressive representation however ther is only weak evidence for a cointegration realtionship

natural disasters damage to banks and firm investment this article investigates the effect of banks lending capacity on firms investment to identify exogenous shocks to loan supply we utilize the natural experiment provided by japan s great hanshin awaji earthquake in 1995 using a unique data set that allows us to identify firms and banks in the earthquake affected areas we find that the investment ratio of firms located outside the earthquake affected areas but having a main bank inside the areas was significantly smaller than that of firms located outside the areas and having a main bank outside the areas our findings suggest that loan supply shocks affect firm investment abstract from author

investment behavior observable expectations and internal funds we use earnings forecasts from securities analysts to construct a new measure of the neoclassical fundamentals that drive investment spending we find that investment responds significantly to our new measure of fundamentals but is insensitive to cash flow even for firms typically thought to be liquidity constrained these results have two key implications first fundamentals may be more important for investment spending than would be suggested by the results to date from investment q models second the positive cash flow effects obtained in such models may reflect a failure to control properly for fundamentals rather than the presence of financial constraints jel d92 e22

an objective measure of search versus experience goods i introduction search goods and experience goods have been part of the lexicon of economics for twenty years now during this time a substantial body of research has been influenced by nelson s 1970 and 1974 papers which enlarged upon stigler s 1961 seminal paper despite the appeal of the search versus experience dichotomy to members of the economics profession empirical development and application of the concepts involved has not been impressive 1 stigler 1961 argued that consumers efforts to acquire information about the quality or performance of products and vendors are a function of expected benefits and costs nelson s 1970 1974 work attempted to measure the expected benefits and to a lesser extent expected costs to consumers of acquiring product and vendor information unfortunately although this search versus experience dichotomy now is part of economists conventional wisdom it has led to little empirical analysis beyond nelson s investigations the root problem seems to be a lack of agreement over the definition of a search good versus an experience good to nelson 1970 the latter is one whose qualitative characteristics are not ascertainable by buyer inspection prior to purchase thus information about the product s quality or performance can be obtained only through buying and using the item we can however ascertain performance information about search goods prior to purchase porter s 1976 analysis of the acquisition of product information by consumers classified items as convenience and non convenience goods the former are characterized by low unit price and high frequency of purchase the opposite holds for non convenience goods the low unit price of convenience goods implies that relevant performance information will be acquired via sampling experience even though one might be able to acquire the information from other sources but at higher cost an experience good is not such by design rather by virtue of consumer choice in the face of varying informational costs thus porter s measure of the incentive to acquire product vendor information is product price as opposed to nelson s ad hoc search experience dichotomy using porter s classification meisel 1979 argues that the degree to which consumers efforts to acquire information take the form of search rather than sampling experience depends on the expected costs and benefits for any given product similarly laband 1986 argues that consumer demand for product and vendor information in advance of purchase is affected by both price and frequency of purchase nelson s classification scheme is at odds with his definitions for example he regards food as an experience item although much relevant information about it is available prior to purchase 2 product classification is admittedly ambiguous e g jewelry and silverware in fact the search vs experience classification more logically represents the two extremes of product classification with most items falling somewhere in between by subdividing experience goods into durable and nondurable categories nelson 1974 validates this assertion given this ambiguity it is understandable that empirical research in this nexus of producer consumer interaction has been limited to use the search experience classification for empirical analysis one must either borrow nelson s existing scheme which is limited in product coverage or create new product classifications which are of dubious merit on the other hand the porter meisel analyses which do provide the micro foundations of consumer behavior in the face of uncertain product vendor quality have never supplanted or integrated nelson s work into their broader framework the purpose of this paper is to bridge these two strands of the advertising as information literature i argue that the discussion of search versus experience goods and more importantly the behavior of buyers and sellers is driven by the cost to the buyer of a disappointing purchase

advertising as information further evidence in the past 30 years the economics of information has become an important feature of the revolution in modern microeconomic theory the seminal literature includes theoretical advances by stigler 10 nelson 7 8 spence 9 and darby and karni 1 in an original approach laband 3 tests the proposition that the supply of product quality signals increases with a rise in the expected marginal return to consumers utilizing yellow pages advertisements in various urban settings in later expositions laband 4 5 provides further evidence of the durability of the informational content and the differences in information provision of television and commercial advertisements for different types of goods the present paper extends and provides alternatives to laband s tests of the impact of time costs faced by consumers on the informational content of advertising this study employs a supplementary category to laband s of credence goods developed in the literature 2 6 and analyzes the impact of income as a proxy for time and information costs with a unique intra city data set from new york city and los angeles

what lessons have been learned in reforming the renewables obligation an analysis of internal and external failures in uk renewable energy policy abstract despite operating a delivery programme for res e since 1990 uk targets and policy goals have not been achieved in response the government reformed the ro this article re examines uk renewable energy policy by analysing the internal and external failures of the various mechanisms to determine if government has learnt from previous experience in reforming the ro government did not learn from their own actions during the nffo ro transition evidenced by high levels of similarity in internal external failures the reformed ro is expected to significantly increase deployment has provided a renewables package by comprehensively addressing both internal external failures but major internal failures price financial risk still remain resulting in contiguous failures over two decades and two mechanism changes nffo ro ro reformed ro success will again be heavily dependent on a select few technologies and new untested measures to combat external failures mechanism extension to 2037 is probably the single most important factor underlying potential deployment increases however introducing a fit like system via the sheer number of bolt on reforms to counter policy failures indicates loss of direction and clarity overall although government appears to have learnt some of its lessons from the past two decades significant doubt remains whether renewable energy policy objectives will be met via the latest mechanism change

advertising as special service provision under non price vertical restraints exclusive territories in beer distribution this article presents statistical evidence which supports lester telser s 1960 hypothesis that when vertical restraints are made illegal intrabrand competition results which diminishes the provision of point of sale special services this results because of the public goods problem exhibited by the special services increased special service provision by the national manufacturer must then substitute for the special service provision left unfilled by the wholesaler evidence relating to the efficacy of such substitution is also presented

the online shadow of offline signals which sellers get contacted in online b2b marketplaces this article extends the understanding of what impels buyers to contact particular sellers in online business to business b2b marketplaces which are typically characterized by sparse social structures and concomitant limitations in observing social cues integrating an institutional perspective with signaling theory our core argument is that offline seller characteristics that are visible online in particular geographic location and legal status convey credible signals of seller behavior because they provide buyers with information on sellers local institutional quality and the institutionally induced obligations and controls acting on sellers using unique data from a large italian online b2b marketplace between the fourth quarter of 1999 and july 2001 we find that both sellers local institutional quality and their legal statuses affect a buyer s likelihood of contacting a seller moreover consistent with the idea that a buyer s own local institutional quality generates a relevant reference point against which sellers are evaluated we find that a buyer is progressively more likely to contact sellers the higher their local institutional quality relative to the buyer jointly our findings imply that in online b2b marketplaces signals conveyed by sellers geographic locations and legal statuses may constitute substantive sources of competitive heterogeneity and market segmentation

investment dynamics with fixed capital adjustment cost and capital market imperfections this paper examines the implications of financing frictions on capital stocks and on capital accumulation in the presence of non convex costs of adjusting the capital stock in this setup finance has an influence on both the level of capital and the timing of investment finance and productivity are complements and finance influences investment the strongest when firms wish to significantly adjust capital for fundamental reasons these theoretical considerations are confronted with uk data while finance is mostly irrelevant for long term capital decision the short run investment function shows a significant impact of finance which is also strongest for strong fundamental investment incentives

the winds of change how wind firms assess germany s energy transition abstract in september 2010 the german government initiated a plan to shift from fossil fuels to renewable energies with nuclear power as a bridging fuel following the fukushima nuclear disaster however the government decided to immediately shut down almost half of germany s reactors and phase out the rest by 2022 the outcome of germany s energy transition energiewende from high carbon and nuclear sources of power to renewable energies has implications for germany s prosperity and may serve as either a positive or negative model for other countries achieving the energiewende will require the commitment of germany s renewable energy companies whose opinions on the transition have not yet been reported this article seeks to help fill this gap by relating the views of over 80 percent of germany s wind industry per market share the firms in our study are mostly optimistic about the government s ambitious targets but express concern over the prospects for offshore wind lagging network expansion and the efficacy of extant legislation to support the transition from the government s side cost concerns have already led to discussions of slowing the transition leading to a push pullback policy approach for the transition to proceed smoothly fundamental issues such as market design must be resolved

a comment on the economics of labor adjustment mind the gap reply in earlier contributions ricardo j caballero and eduardo m r a engel 1993 hereafter ce and caballero et al 1997 hereafter ceh investigate labor dynamics using a methodology which postulates that employment changes depend on a gap between the actual and target levels of employment both studies find evidence of nonlinearities in aggregate timeseries data employment growth depends on the cross sectional distribution of employment gaps this finding is taken as evidence that nonlinear adjustment at the microeconomic level matters for aggregate time series this is important for business cycle and policy analysis as it implies macroeconomics must take the cross sectional distribution of employment gaps into account this paper questions the methodology and thus the conclusions of these studies we argue that these reported aggregate nonlinearities may be the consequence of mismeasurement of the gap rather than nonlinearities in plant level adjustment both ce and ceh rely upon a hypothesis that employment growth responds to a gap z between the desired and actual number of workers at a plant the advantage to the gap approach is that the choice of employment an inherently difficult dynamic optimization problem is characterized through a nonlinear relationship between and z that is the adjustment rate z is postulated to be a nonlinear function of z however there is no free lunch the desired number of workers and hence the employment gap is unobservable thus in order to confront data this approach needs an auxiliary theory to infer z from observed variables both ce and ceh use observed hours variations to infer the employment gap this inference is one element of our critique of the gap methodology to assess this methodology we simulate data from the solution of a dynamic model of labor adjustment assuming quadratic adjustment cooper department of economics university of texas austin tx 78712 e mail cooper eco utexas edu willis research department federal reserve bank of kansas city kansas city mo 64198 e mail jonathan willis kc frb org we are grateful to seminar participants at boston university emory university the university of british columbia the federal reserve bank of boston the university of haifa the university of iowa the university of michigan the university of pennsylvania the university of texas at austin the 2002 nber ef meeting and the 2000 cmsg conference at mcmaster university for comments and suggestions discussions with eduardo engel john haltiwanger daniel hamermesh peter klenow and christopher ragan were much appreciated the authors thank the nsf for financial support we also appreciate comments from the referees cooper thanks the federal reserve bank of minneapolis for its hospitality during revisions of this manuscript the views expressed herein are solely those of the authors and do not necessarily reflect the views of the federal reserve bank of kansas city the federal reserve bank of minneapolis or the federal reserve system 1 daniel hamermesh 1989 uses a gap methodology as well but does not adopt the approach of estimating a nonlinear hazard function explained below to infer the nature of adjustment costs hence we focus on ce and ceh in this discussion of methodology 2 we do not contest the general view of nonlinear employment adjustment at the plant level this finding is consistent with other evidence that points to inactivity as well as bursts of employment adjustment at the plant level for example hamermesh 1989 provides a revealing discussion of lumpy labor adjustment at a set of manufacturing plants steven davis and john haltiwanger 1992 document large employment changes at the plant level ceh also report evidence of inactivity in plant level employment adjustment there seems little doubt that an explanation of plant level employment dynamics requires a model of adjustment that is richer than the quadratic adjustment cost structure and includes some forms of nondifferentiability and or nonconvexity 3 as the gap approach is used in numerous other applications capital adjustment durable adjustment price adjustment to approximate the solution to dynamic optimization problems our concerns may be relevant for those exercises as well

what can be learned from practical cases of green economy studies from five european countries the transition to green economies has been mediated by concrete cases and experiments in a variety of different industrial and social sectors what is lacking is research that would synthesize key findings and lessons learned across a variety of cases in this study we explore ten cases of green economy of different sectors and approaches from five european countries and identify factors that have had critical importance for the success or failure of the cases our paper reveals similarities across small and large scale cases and different approaches for implementing green economy we identified critical factors related to economic viability public funding technological development impact assessments public policies and regulation social capital leadership and coordination as well as public acceptability and image according to our results transition to green economies requires negotiation between potential trade offs among multiple goals and interests of various stakeholders the mutual benefits can be communicated through valid impact assessments and the integration of r d into the practical implementation securing the continuity of funding and leadership is crucial in successful experiments and attention should be paid to fostering social capital among stakeholders instead of any single critical factor the practical implementation of green economy is related to a multiplicity of factors and causalities depending on the context the challenges with the practical implementation of green economy can only be met with patient careful and far sighted planning of green economy initiatives as well as continuous learning from past experiences

explaining investment dynamics in u s manufacturing a generalized s s approach we are grateful to olivier blanchard whitney newey james stock an editor three anonymousreferees and seminar participants at brown cepr champoussin chicago columbia econometric society meetings caracas and tokyo efcc harvard impa lse nber princeton rochester site toronto u de chile and yale for their comments financial support to caballero from the national science and sloan foundations and to engel from fondecyt grant 195 510 and the mellon foundation grant 9608 is gratefully acknowledged 2since plants entry is excluded from their sample these statistics are likely to represent lowerbounds on the degree of lumpiness in plants investment patterns 3we use the word project to emphasize the fact that the actual implementation of a projectmay cover more than a year observation realistic time to build aspects of investment are not incontradiction with the view that investment episodes are lumpy in nature 4 see chirinko 1994 for a survey of the empirical investment literature

competition between networks a study of the market for yellow pages this paper estimates the importance of network effects in the market for yellow pages i estimate three simultaneous equations consumer demand for usage of a directory advertiser demand for advertising and a publisher s first order condition derived from profit maximizing behaviour estimation shows that advertisers value consumer usage and that consumers value advertising implying a network effect i find that internalizing network effects would significantly increase surplus as an application i consider whether the market benefits from monopoly which takes advantage of network effects or oligopoly which reduces market power i find that a more competitive market is preferable copyright 2004 wiley blackwell

currency crises and monetary policy in an economy with credit constraints this paper presents a simple model of currency crises which is driven by the interplay between the credit constraints of private domestic firms and the existence of nominal price rigidities the possibility of multiple equilibria including a currency crisis equilibrium with low output and a depreciated domestic currency results from the following mechanism if nominal prices are sticky a currency depreciation leads to an increase in the foreign currency debt repayment obligations of firms and thus to a fall in their profits this reduces firms borrowing capacity and therefore investment and output in a credit constrained economy which in turn reduces the demand for the domestic currency and leads to a depreciation we examine the impact of various shocks including productivity fiscal or expectational shocks we then analyze the optimal monetary policy to prevent or solve currency crises we also argue that currency crises can occur both under fixed and flexible exchange rate regimes as the primary source of crises is the deteriorating balance sheet of private firms

correction to the paper optimal product launch times in a duopoly balancing life cycle revenues with product cost the aim of this note is to correct an error in the formulation of theorem 1 by savin and terwiesch savin s c terwiesch 2005 optimal product launch times in a duopoly balancing life cycle revenues with product cost oper res 53 1 26 47

economic effects of renewable energy expansion a model based analysis for germany abstract the increasing utilization of renewable energy sources res is a major energy policy strategy in many countries worldwide germany is a forerunner in the deployment of res and has ambitious goals for the future the support and use of renewables affects the economy it creates business opportunities in sectors producing renewable energy facilities but comes with costs related to supporting its deployment this paper analyses and quantifies the net balance of economic effects associated with renewable energy deployment in germany until 2030 to this end we use a novel model the sectoral energy economic econometric model this is an econometric multi country model which for germany contains a detailed representation of industries including 14 renewable energy technology sectors our results show that renewable energy expansion can be achieved without compromising growth or employment the analysis reveals a positive net effect on economic growth in germany net employment effects are small but also positive their size depends strongly on labour market conditions and policies results at the industry level indicate the size and direction of the need for restructuring across the sectors of the germany economy

the relationships among energy consumption economic output and energy intensity of countries at different stage of development based on 3gr model the relationships between energy consumption economic effect and technical effect of countries at different stage of development developed developing and the least developed countries was figured out comparing the equivalent value of grec greo and grei during the period from 1996 to 2013 the diverse development laws in different kinds of countries was found the following conclusions were obtained 1 based on 3gr model there is a liner relationship between grec and greo or grei and an inverse relationship between grei and greo when the equivalent value of 1 greoi or 1 greii or 1 greci is a constant 2 the equivalent value of greo are in the following orders developed countries developing countries the least developed countries while that of grei have the opposite orders the orders of the equivalent value of grec are developed countries the least developed countries and developing countries from small to large the least developed countries own the largest potential to realize further development whether in economic expansion technical innovation or in optimize industrial structure while these potential in developed countries are the smallest and in developing countries are at the middle level the development in developing countries shows the most growth going forward 3 the change in energy consumption is codetermined by eo effect ei effect and their interactive effect eo effect shows the leading position among the three effects especially in developing countries and the least developed countries in developed countries ec change eo effect and ei effect are both change in a tight range while in developing countries and the least developed countries these ranges are rather large

transition pathways revisited established firms as multi level actors in the heavy vehicle industry abstract the multi level perspective on sustainability transitions positions established firms incumbents as defenders of existing technologies at the regime level by contrast it positions new entrants at the niche level as promoters of new technologies this paper challenges the positioning of firms as actors on either regime or niche levels based on a comparative analysis of technology strategies in the heavy vehicle industry the paper shows that established firms are active at both levels developing several technology alternatives simultaneously this means that incumbents technology strategies determine important parts of the required niche regime interactions the paper also shows how incumbents may pursue contrasting technology strategies while some adopt a dualistic approach keeping regime and niche level activities technologically and commercially separate others develop integrated strategies where niche activities are leveraged to impact upon the regime level the cases studied illustrate how the success of such integrated strategies depends on the emergence of bridging policies bridging policies are relevant both for linking early niche markets to broader regime level markets and for supporting further technological advancements of niche markets

business strategies and the small professional firm evidence from the conveyancing market this paper examines the use of business strategies by firms of solicitors in england although still often seen as the epitome of the traditional profession recent deregulation and liberalisation of the legal services market has forced solicitors to consider the use of more business like approaches to the operations of their firms using the framework provided by john kay it is possible to identify distinctive capabilities among some firms in the provision of conveyancing despite the fact that this is a relatively routine service provided mainly by small professional firms the use of reputation is crucial here analysis of the conduct of sample firms suggests that business strategies can be identified with respect to pricing and advertising and that the advertising behaviour of law firms closely matches the predictions of relevant economic theory the paper concludes that it is meaningful to speak of strategy among at least some small professional firms

the destabilisation of existing regimes confronting a multi dimensional framework with a case study of the british coal industry 1913 1967 because innovation studies are oriented towards novelty scholars in this field have paid less attention to the destabilisation of existing regimes this paper discusses four views on industry destabilisation and presents an encompassing conceptual framework which addresses interactions between the build up of external pressures industry response strategies and the gradual weakening of commitment to existing regime elements we confront the framework with an in depth longitudinal case study of the british coal industry 1913 1967 specific conclusions are developed about different degrees of regime inertia the ebb and flow of external pressures the relative importance of economic and socio political pressures and interactions between them

sequential market entries and competition modelling in multi innovation diffusions abstract the diffusion of innovations for simultaneous processes cannot take into account and properly explain systematic perturbations due to competition substitution effects if they are examined one by one a first aspect in simultaneous competing diffusions is the distinction between simultaneous market entries synchronic competition and sequential entries diachronic competition in the latter case the beginning of competition may upset the first entrant s diffusion a second important aspect in multiple competition is represented by the choice to model the word of mouth effect either at the category level balanced model or at the brand level separating the within brand effect from the cross brand one unbalanced model in this paper balanced models are studied and we propose a model that allows for a change in the parameter values of the first entrant as soon as the second one enters the market the resulting differential system has a closed form solution that enables through sales data an empirical validation of the assumptions underlying the model structure improving the forecasting accuracy an application to pharmaceutical drug competition is discussed

green energy market development in germany effective public policy and emerging customer demand this paper reviews the development of renewable energy in germany from 1973 to 2003 it investigates the relative importance of energy policy and green power marketing in shaping the renewable energy market more than a decade of consistent policy support for renewables under the feed in law streg and its successor eeg has been an important driver for increasing renewable electricity generation to date putting the country in a better position than most of its peers when it comes to achieving european union targets for renewable energy green power marketing driven by customer demand on the other hand is growing but has had limited measurable impact so far we discuss potential intangible benefits of green power marketing and scenarios for future market development the paper concludes with lessons that can be learned from the german case for policy design and market development in other countries

investment dynamics with information costs investment in physical capital at the micro level is infrequent and large or lumpy the most common explanation for this is that firms face non convex physical adjustment costs the model developed in this paper shows that information costs make investment lumpy at the micro level even in the absence of non convex adjustment costs when collecting and processing information is costly the firm optimally chooses to do it sporadically and to be inactive most of the time this behavior results in infrequent and possibly large capital adjustments the model fits plant level investment rate moments well and it also matches some higher order moments of aggregate investment rates keywords investment dynamics information costs inattentiveness lumpy investment jel classification d21 d83 d92 e22

steering innovations towards a green economy understanding government intervention in this paper we analyse institutional conditions facilitating the transition towards a green economy by encouraging investment in the enhancement of natural capital and social equity focussing especially on government interventions presenting a conceptual institutional model how innovation generally occurs we depict system levels that can be influenced by government interventions to facilitate societal innovations towards a green economy we hypothesize that the transition to a green economy is about extending the possibility frontier outwards towards a greener economy while at the same time limiting the action space at the brown economy end a normative evaluation framework is presented to assess transitions correspondingly we elaborate on the emerging lessons for governance by examining evidence from five selected european case studies and provide a non exhaustive list of impacts that government intervention may have on the action spaces available at different system levels

face value information and signaling in an illegal market author affiliation trevon d logan the ohio state university and nber 410 arps hall 1945 north high street columbus oh 43210 usa e mail logan 155 osu edu corresponding author manisha shah dagger university of california los angeles and nber 3250 public affairs building los angeles ca 91195 e mail manishashah ucla edu acknowledgment we would like to thank george akerlof rodney j andrews raj arunachalam andrea a cann lisa d cook brahima coulibaly scott cunningham angus deaton avinash dixit claudia d goldin karla hoff joseph kaboski simon loertscher joseph m newhard christina paxson john pepper ruth peterson patricia reagan seth sanders ebonya washington nathan woodfork three anonymous referees and numerous seminar participants who provided helpful suggestions the usual disclaimer applies 1 introductionformal enforcement is often seen as the cornerstone of contract design while information can overcome the problems of asymmetric information akerlof 1970 spence 1973 principals are unlikely to engage agents unless the information conveyed is credible and verifiable while the use of formal institutions such as courts is rare relative to the volume of transactions the standard argument is that the presence of formal institutions gives contracts their authority in schelling s 1960 classic terminology the power to sue and be sued gives parties the ability to make credible enforceable commitments a prerequisite to most transactions without means of redress the information that principals and agents share would a priori have little value numerous studies have documented how informal networks long term relationships and reputations overcome problems of asymmetric information indeed researchers have developed large literatures that look at limited contractibility hart 1995 tirole 1999 and situations in which formal enforcement is costly greif 1993 to consider the additional mechanisms that must be in place if existing institutions are lacking or unable to mediate disputes however the literature has not developed an empirical answer to whether the value of information without formal enforcement approaches its value when formal enforcement is present in this article we ask two questions i are formal enforcement mechanisms necessary for the information that principals and agents share to have value ii if not then what is the value of information in an environment without formal enforcement ideally we would like to analyze an illegal market to answer these questions illegal markets rule out the possibility that market function or variation in the information environment is due to the presence of formal enforcement similarly in an illegal market the information that principals and agents convey to one another may not be credible or verifiable and misrepresentation is not likely to be punished the problem is that most illegal markets have coarse information environments it is therefore challenging to obtain information on prices quantities and consumer and producer behavior making empirical answers to these questions especially difficult we overcome these problems by analyzing an illegal market with a rich information structure the online market for male sex work we begin with a general description of this seldom studied market we then document the ways in which the clients of male sex workers informally police the market by informing other clients of deceptive sex workers and by reviewing sex workers on independent client owned web sites the informal policing in the market raises the cost of misrepresentation for would be fraudulent escorts and rewards the truthful self disclosure of honest escorts encouraging truthful self disclosure we further exploit this institutional knowledge to identify the specific information clients treat as signals of escort quality

the german energy transition as a regime shift abstract in this paper i use the resilience framework to interpret the project of transforming the german energy system into a renewable energy sources res based system the so called energiewende as a regime shift this regime shift comprises several transformations which are currently altering the technological political and economic system structure to build my argument i first sketch how technological political and economic developments reduced the resilience of the conventional fossil nuclear energy regime and created a new res regime second i depict recent changes in german public discourse and energy policy as the shift to the res regime third i highlight the challenges involved with increasing the resilience of the res regime in particular sufficient resilience of the electricity transmission grid appears to be crucial for facilitating the transformation of the whole energy system

a comment on the economics of labor adjustment mind the gap rejoinder numerous papers in this literature have used these questions as motivation understanding the structure of labor adjustment costs is relevant any time a policy or forecasting question requires input on the properties of labor dynamics of course for some policy questions we are interested in the aggregate effects of policies hence understanding whether nonconvexities have implications for aggregate labor demand is crucial as well in terms of the ongoing discussion over these questions there seems to be agreement that the simple quadratic adjustment cost model is not an adequate representation of the costs plants face in adjusting the number of workers from data displayed by daniel hamermesh 1989 and caballero et al 1997 hereafter ceh one is certainly struck by both the inactivity of labor adjustment and the bursts of job creation and destruction at the plant level that said while these observations serve as evidence against a model which contains only quadratic adjustment costs they do not directly identify a particular structure of adjustment costs at the plant level inspection of the adjustment patterns reported in ceh though cast in terms of gaps does provide some evidence of partial adjustment and thus suggests the presence of both convex and nonconvex adjustment costs further caballero and engel 1993 hereafter ce and ceh appear to have provided useful evidence on the second question the nonlinearities they uncover in aggregated data suggest that nonconvexities at the plant level have aggregate implications

do policy mix characteristics matter for low carbon innovation a survey based exploration of renewable power generation technologies in germany abstract policy mixes may play a crucial role in redirecting and accelerating innovation towards low carbon solutions thus addressing a key societal challenge towards this end some argue that the characteristics of such policy mixes matter greatly yet with little empirical evidence backing up such claims in this paper we explore this link between policy mix characteristics and low carbon innovation using the research case of the transition of the german electricity system towards renewable energy our empirical insights are based on an innovation survey administered to german manufacturers of renewable power generation technologies which builds on the community innovation survey for our purposes we adjusted the survey to better capture companies perceptions of policy mixes employing a bivariate tobit model we find evidence that companies perceptions regarding the consistency and credibility of the policy mix are positively associated with their innovation expenditures for renewable energies and this positive link intensifies when considering the mutual interdependence of these policy mix characteristics in contrast neither the comprehensiveness of the instrument mix nor the coherence of policy processes were found to be related to innovation expenditures overall these findings suggest that future research on low carbon and eco innovation should pay greater attention to the characteristics of policy mixes rather than focusing on policy instruments only finally our findings indicate a need to consider how policy may be measured in innovation surveys to generate better informed policy advice regarding the greening of innovation

machine replacement and the business cycle lumps and bumps this paper explores investment fluctuations due to discrete changes in a plant s capital stock the resulting aggregate investment dynamics are surprisingly rich reflecting the interaction between a replacement cycle the cross sectional distribution of the age of the capital stock and an aggregate shock using plant level data lumpy investment is procyclical and more likely for older capital further the predicted path of aggregate investment that neglects vintage effects tracks actual aggregate investment reasonably well however ignoring fluctuations in the cross sectional distribution of investment vintages can yield predictable nontrivial errors in forecasting changes in aggregate investment

assessment of the actual sustainability of nuclear fission power this paper uses 19 criteria to assess whether nuclear fission power can be a part of sustainable development this yes or no qualitative evaluation is due prior to ongoing marketability assessment and promotion of nuclear power by for example the iaea the iea and the uk government the criteria are classified into five groups planet results demonstrate that the incompatibility of nuclear expansion with electricity efficiency and full renewable power deployment largely overshadows the carbon free steam generation of nuclear fission prosperity analyses show that including rolled off costs and risks would raise bills to heights difficult to quantify due to doubts long term invisibility and irreversibility risks may be catastrophic and are not insurable while weaponry proliferation adds a further dimension people analyses reveal that some nuclear power is affordable for present generations when many costs remain unpaid however developing countries cannot afford the capital costs and technology intensity and catastrophes wreak havoc on national economies singling out exposed communities losing their habitats politics assessments demonstrate that nuclear technocracy dominates the scene in many countries the technocrats heavily influence policy makers the media and celebrities speaking out in favor of nuclear we identify the need for an independent global agency and for independent national nuclear regulatory institutions to safeguard the public interest

reconceptualising the policy mix for innovation abstract recent years have seen the emergence take up and use of the term policy mix by innovation policy makers and by policy analysts and scholars alike imported from economic policy debates the term implies a focus on the interactions and interdependencies between different policies as they affect the extent to which intended policy outcomes are achieved however the meaning of the term remains ambiguous nonetheless we argue that the emergence of the policy mix concept into common use in the field of innovation policy studies provides us with a window of opportunity to reconsider some basic and often hidden assumptions in order to better deal with a messy and complex multi level multi actor reality we draw upon a range of literatures to re conceptualise the basic building blocks of innovation policy studies in order to arrive at a useful definition of policy mix tensions and interactions of different kinds across a series of dimensions we suggest that this reconceptualisation has important implications for the future scope and focus of prescriptive and analytical innovation policy studies

the national system of innovation in historical perspective contrary to some recent work on so called globalisation this paper argues that national and regional systems of innovation remain an essential domain of economic analysis their importance derives from the networks of relationships which are necessary for any firm to innovate whilst external international connections are certainly of growing importance the influence of the national education system industrial relations technical and scientific institutions government policies cul tural traditions and many other national institutions is fundamental the historical examples of germany japan and the former ussr illustrate this point as well as the more recent contrast between east asian and latin american countries introduction the national system of friedrich list according to this author s recollections the first person to use the expression national system of innovation was bengt ake lundvall and he is also the editor of a highly original and thought provoking book 1992 on this subject however as he and his colleagues would be the first to agree and as lundvall himself points out the idea actually goes back at least to friedrich list s conception of the national system of political economy 1841 which might just as well have been called the national system of innovation the main concern of list was with the problem of germany overtaking england and for underdeveloped countries as germany then was in relation to england he advocated not only protection of infant industries but a broad range of policies designed to accelerate or to make possible industrialisation and economic growth most of these policies were concerned with learning about new technology and applying it the racialist and colonialist overtones of the book were in strong contrast to the inter nationalist cosmopolitan approach of the classical free trade economists and list s belief that holland and denmark should join the german bund and acquire german nationality because of their descent and whole character reads somewhat strangely in the european community of today nevertheless despite these unattractive features of his outlook he clearly anticipated many contemporary theories after reviewing the changing ideas of economists about development in the years since the second world war the world bank 1991 concludes that it is intangible investment in knowledge accumulation which is decisive rather than physical capital investment as was at one time believed pages 33 35 the report cites the new growth theory

the role of non convex costs in firms investment and financial dynamics abstract this paper shows that non convex costs of financial adjustment are quantitatively relevant for explaining firm dynamics first empirically financial activity is lumpy more than investment activity second non convex costs are necessary in the context of a dynamic investment and financing model to rationalize this lumpiness two versions of the model with and without non convex costs are compared only the non convex costs version replicates the dynamics in the data generating financial lumpiness higher than investment lumpiness other predictions of the model with respect to investment and finance are discussed

the hygienic transition from cesspools to sewer systems 1840 1930 the dynamics of regime transformation this article addresses the topic of transition and system change and proposes endogenous regime transformation as alternative transition path to technological substitution using sociological and institutional insights the dynamics of regime transformation are conceptualised two characteristics are pressure from outsider groups and adjustments in cognitions norms and formal rules enacted by regime insiders the transformation perspective is illustrated with a historical case study the hygienic transition from cesspools to integrated sewer systems in the netherlands the case study is used to make additions to the transformation perspective particularly with regard to tactical and strategic games

learning from experience the development of the renewables obligation in england and wales 2002 2010 abstract the uk has enviable renewable resources both onshore wind and offshore wind wave and tidal the offshore valuation group 2010 the government has had policy mechanisms in place since 1990 to encourage these resources to be developed the current mechanism the renewables obligation ro was specifically designed to emphasise competition and therefore to fit in with the uk s overall strategic approach to energy policy however as yet it has not delivered the capacity that it was designed to do and as a result the uk faces a difficult challenge in attempting to meet european wide renewable energy targets for 2020 as well as longer term decarbonisation targets this paper explores some of the major reasons why the ro has performed so poorly to date and considers the prospects for improvement up to 2020 it concludes that the strategic emphasis on competition in the support mechanisms has played a key role in limiting renewables development but that the mechanism has changed significantly since it was introduced however these changes together with proposals for electricity market reform still do not address important elements of risk in comparison with a standard feed in tariff

customer return policies for experience goods the impact of product price and consumer search costs on seller provided informational cues the present article provides an extension of previous theoretical arguments regarding customer return policies for experience goods logit regressions presented here suggest the importance of the full cost to consumers of a purchase mistake as proxied by experience goods prices and the time costs to consumers associated with search in the seller s decision to produce information in advertisements regarding return policies the evidence points out that sellers do respond in their decisions to produce information in a manner that reduces the total cost of voluntary exchange and maximizes seller profits

are differences in firm size transitory or permanent an erratum for this article has been published in journal of applied econometrics 18 2 2003 249 previous empirical work on corporate growth rates using cross section or short panel econometric techniques suggests that growth rates are random but that some degree of mean reversion exists this means that size differences between firms are transitory another more natural way to explore the long run distribution of firm sizes is to examine data on the growth of particular firms over long periods of time using a sample of 147 uk firms observed continually for more than 30 years our conclusions are that growth rates are highly variable over time and that differences in growth rates between firms do not persist for very long further firms show no tendency to converge to either a common size or to a pattern of stable size differences over time these results are compared and contrasted with standard approaches that suggest that firms reach and maintain stable positions in a skewed size distribution copyright 2002 john wiley sons ltd

renewable electricity generation in germany a meta analysis of mitigation scenarios german energy policy targets envision a share of electricity from renewable energy sources res e of at least 80 in 2050 how can the transformation of the german electricity sector be achieved and at what costs this paper addresses these questions by means of a meta analysis of 10 recent model based mitigation scenarios for germany it turns out that the scenarios exploit the three basic strategic options of increasing the share of res e domestic res e generation electricity demand reductions and res e imports to substantially different extents domestic res e generation increases in all scenarios particularly from onshore and offshore wind scenarios that rely heavily on reducing electricity demand require a relatively low expansion of domestic res e generation despite detailed technical analyses insights on the costs of the transformation remain limited a discussion of underlying scenario assumptions reveals that it is unclear whether i res e and system integration technology development will be as cost competitive as postulated ii implicitly assumed institutional requirements will be realized and iii relevant actors in the transformation process will be incentivized accordingly therefore future research should pursue a thorough assessment of strategic options for transforming the german electricity system that consistently integrates technologies institutions and actors

current challenges of germany s energy transition project and competing strategies of challengers and incumbents the case of direct marketing of electricity from renewable energy sources electricity generated by renewable energies res e already accounts for 25 of germany s electricity supply this has led to recent discussions for a better market integration of res e the paper examines how competing actors and their ideas on market integration developed new services for direct marketing according to their respective origins and tried to shape the regulatory framework the paper analyses this process and explains the current shape of the field of direct marketing medium sized structured actors who favoured res e integration via the conventional wholesale power markets and who formed early close coalitions with res e power producers at the same time have been most successful in terms of market shares moreover they have been very successful for different reasons in building up coalitions with governance units and influencing the field rules and routines based on those findings the paper will conclude with some policy advices for the future adjustment of the current regulative frameworks as long as there is no evidence of how res e can be integrated most effectively and efficiently policies should maintain a competition between different direct marketing strategies to find out which strategies serve the best in terms of achieving a successful energy transition

a diffusion theory model of adoption and substitution for successive generations of high technology products this study deals with the dynamic sales behavior of successive generations of high technology products new technologies diffuse through a population of potential buyers over time therefore diffusion theory models are related to this demand growth furthermore successive generations of a technology compete with earlier ones and that behavior is the subject of models of technological substitution building upon the bass bass f m 1969 a new product growth model for consumer durables management sci 15january 215 227 diffusion model we develop a model which encompasses both diffusion and substitution we demonstrate the forecasting properties of the model by estimating parameters over part of the data and projecting shipments for later periods

on the interaction of financial frictions and fixed capital adjustment costs evidence from a panel of german firms abstract this paper analyzes the interaction of financial frictions and non convex adjustment costs non convex adjustment costs imply that firm level investment is lumpy firms invest infrequently but each investment is large this allows financial variables to influence investment along two margins they can alter the size of the stock of capital a company wishes to hold in the long run or they can influence the frequency at which investment projects are undertaken the empirical analysis of this paper reveals that finance has nearly no long run influence on the stock of capital in a sample of german companies by contrast the influence of finance on investment decisions is substantial consequently finance primarily affects investment frequencies and financial factors and fundamental capital productivity strongly interact in the determination of investment

idiosyncratic shocks and the role of nonconvexities in plant and aggregate investment dynamics we examine a model of lumpy investment wherein establishments face persistent shocks to common and plant specific productivity and nonconvex adjustment costs lead them to pursue generalized s s investment rules we allow persistent heterogeneity in both capital and total factor productivity alongside low level investments exempt from adjustment costs to develop the first model consistent with available evidence on establishment level investment rates reassessing the implications of lumpy investment for aggregate dynamics in this setting we find that they remain substantial when factor supply considerations are ignored but are quantitatively irrelevant in general equilibrium the substantial implications of general equilibrium extend beyond the dynamics of aggregate series while the presence of idiosyncratic shocks makes the time averaged distribution of plant level investment rates largely invariant to market clearing movements in real wages and interest rates we show that the dynamics of plants investments differ sharply in their presence thus model based estimations of capital adjustment costs involving panel data may be quite sensitive to the assumption about equilibrium our analysis also offers new insights about how nonconvex adjustment costs influence investment at the plant when establishments face large and weakly persistent idiosyncratic productivity shocks consistent with existing estimates we find that nonconvex costs do not cause lumpy investments but act to eliminate them

compulsive policy making the evolution of the german feed in tariff system for solar photovoltaic power abstract in recent years policy approaches that build upon the notion of innovation systems have enjoyed increasing attention in science technology and innovation policy but while the usefulness of systemic thinking in policy making has been demonstrated in a large number of empirical settings we still lack a detailed understanding of the dynamics at play when policy makers address systemic problems in this paper we show how complex interdependencies and the uncertain nature of technological change shape the process of targeted policy interventions in socio technical systems toward this end we analyzed the evolution of the german feed in tariff fit system for solar photovoltaic power a highly effective and widely copied policy instrument targeted at fostering the diffusion and development of renewable energy technologies we find that the policy has been subject to a considerable amount of changes many of which are the result of policy makers addressing specific system issues and bottlenecks interestingly however often these issues themselves were driven by unforeseen technological developments induced by previous policy interventions we argue that the pattern of policy serving as both a solution to and a driver of technological bottlenecks shows strong similarities with what rosenberg 1969 called compulsive sequences in the development of technical systems by shedding more light on how the characteristics of socio technical systems affect policy interventions our framework represents a first step toward more closely integrating the literature on innovation systems with the work on policy learning

investment irreversibility and financing constraints evidence from a panel of transition economies abstract focusing on a panel of unlisted firms from transition economies we observe that only firms facing low irreversibility exhibit high and significant investment cash flow sensitivities our findings provide a new explanation for why some financially constrained firms may exhibit low sensitivities

renewable energy costs potentials barriers conceptual issues renewable energy can become the major energy supply option in low carbon energy economies disruptive transformations in all energy systems are necessary for tapping widely available renewable energy resources organizing the energy transition from non sustainable to renewable energy is often described as the major challenge of the first half of the 21st century technological innovation the economy costs and prices and policies have to be aligned to achieve full renewable energy potentials and barriers impeding that growth need to be removed these issues are also covered by ipcc s special report on renewable energy and climate change to be completed in 2010 this article focuses on the interrelations among the drivers it clarifies definitions of costs and prices and of barriers after reviewing how the third and fourth assessment reports of ipcc cover mitigation potentials and commenting on definitions of renewable energy potentials in the literature we propose a consistent set of potentials of renewable energy supplies

green economy and related concepts an overview for the last ten years the notion of a green economy has become increasingly attractive to policy makers however green economy covers a lot of diverse concepts and its links with sustainability are not always clear in this article we focus on definitions of green economy and related concepts and an evaluation of these concepts against the criterion of strong and weak sustainability the article serves three purposes firstly we identify and describe diverse theories concepts approaches and tools related to a green economy among these are the theories of environmental economics and ecological economics the concepts and approaches of cleaner production waste hierarchy bio economy industrial ecology circular economy nature based solutions and dematerialization through product servicizing and tools like life cycle assessment and cost benefit analysis secondly we develop a framework that shows the capacity of the green economy concepts approaches and tools to support the transition towards sustainability such a framework can serve as a heuristic to embed diverse concepts and approaches into a green economy framework thirdly we briefly discuss green economy concepts with respect to their impact on strong and weak sustainability depending on the different concepts approaches and tools identified in the green economy framework different degrees of substitutability and trade offs between environmental and economic benefits are allowed and more or less structural changes of our modes of living are required by discussing the notion of green economy and related concepts approaches and tools we seek to make a contribution to their definitions and relationships as a prerequisite for operationalizing green economy