bluuebunny/crossref_metadata_2025 huggingface dataset:
Demand Uncertainty, Risk Aversion and the Labour‐Managed Firm
Authors: Wang Leonard F.S. , Bowles David
Published: March 2008

This article examines the behaviour of a labour‐managed firm operating in a world in which the output price is uncertain, but it varies betwen a price floor and a price ceiling. We show that risk aversion is sufficient to give the direct relationship between a change in uncertainty and the optimal level of output for the labour‐managed firm, which is weaker than the decreasing absolute risk aversion assumption imposed by Hawawini and Michel (1979), Hey and Suckling (1980), Hey (1981a) and Paroush and Kahana (1980).
The Theory of Vertical Integration: A Survey and Synthesis
Authors: Casson Mark
Published: March 2008

This article is concerned with the role of theory in explaining the inter‐industry variation of vertical integration (VI). Why, for example, is the world aluminium industry highly integrated (Stukey, 1983) whereas the tin industry is not (Hennart, 1982)? The article is not concerned with explaining differences in the average level of VI across countries, although these are undoubtedly significant (Chandler and Daeins, 1980).
Innovation, Markets and Hierarchies
Authors: Kay Neil M.
Published: March 2008

The central role of innovation in economic growth has been well established in recent years, although its comparative neglect in conventional theory has tended to obscure its true importance. Neoclassical theory has treated innovation traditionally as exogenous; its short‐run constrained maximisation perspective is ill suited to deal with long‐run problems involving a high degree of uncertainty.
Imbalance Theory and the Analysis of Investment and Technical Change by Firms
Authors: Moss S.J.
Published: March 2008

The two main approaches to the analysis of technical change are impact studies which are concerned with quantitative measures of the effects of technical change and case studies which are used to develop inductive generalisations about the sources and directions of technical change. Each of these approaches has deficiencies which are widely and frankly recognised by their respective practitioners.
Farm‐Specific Technical Efficiencies and Development Policies
Authors: Kalirajan K.
Published: March 2008

Agricultural policies in developing countries are mostly concerned with the means of increasing production levels, especially of food grains. The green revolution or new technology has been recognised by decision makers as an important tool in this context. Consequently, the primary objective of any agricultural policy is to achieve high rates of adoption of new technology by farmers. The fact that the success of new technology depends on the efficient use of the technology receives less attention from the decision makers. How crucial this issue of the efficient use of technology is to increasing production levels is examined in this article. The empirical focus is the area with the highest rate of adoption of new technology in the Philippines. Using the stochastic production frontier, farm‐specific technical efficiency is empirically estimated for individual sample observations. The results show a wide variation in the level of technical efficiencies among the sample farmers; and an extension service has been identified as an important factor causing such variations.
The Monetary Approach to the Exchange Rate and the 1920s' Experience with Floating Exchange Rates
Authors: MacDonald Ronald
Published: March 2008

In this article the monetary approach to the exchange rate is tested for the franc‐pound, dollar‐pound and franc‐dollar exchange rates over the period February 1921 to August 1925. It is shown that the estimation technique utilised is very important. Some out of sample forecasts from a variety of exchange rate models are also presented; a simple purchasing power parity model out‐performs the alternatives.
Comparative Analysis of UK Domestic and International Firms
Authors: Singh Kumar Manmohan
Published: March 2008

This article examines the relative characteristics and performance of a large sample of UK domestic and international firms. It investigates the relationship between firm size and overseas production activity, and considers whether firms with overseas production operations have different characteristics compared to the domestic firms. It also enquires into the effect of overseas activities on growth and profitability. Little work has so far been done on these questions with regard to UK firms, and studies for other advanced countries have either used aggregate industry data or examined only the largest firms. The results suggest a reconsideration of some accepted views in this area, and have interesting implications for theory and industrial policy.
The Money Demand Relationship in Saudi Arabia: An Empirical Investigation
Authors: Darrat Ali F.
Published: March 2008

The empirical estimates for the money demand function reported here are based on quarterly time series for Saudi Arabia for the period 1962/I to 1981/IV. The money demand function estimated in this article is novel in that it takes into account the potential effect of external monetary and financial factors on domestic money de‐mand in the open economy of Saudi Arabia. The empirical results show that these external factors (foreign interest rates and exchange rates) do play an important role in the Saudi money demand function. Hence, the Saudi monetary authorities should not ignore the response of domestic money demand to these external factors in formulating their stabilisation policies. The empirical evidence also indicates that the inflationary expectations and permanent real income variables exert significant influences on money demand, with the latter variable exhibiting a unitary long‐run elasticity. Finally, the estimated money demand equation is found to be structurally stable over time.
On‐the‐Job Search and the Public Employment Service
Authors: Adnett N.J.
Published: March 2008

In recent years there has been an expansion of research into the operation of the UK labour market. Under the pressure of economic conditions and in light of theoretical developments much of this research has concentrated on the behaviour of unemployed workers, and in particular their job search. In contrast, little research has been conducted into search by employed workers. In part this reflects the paucity of available data but also the limitations of early search‐based models of labour market behaviour. In this study the development of on‐the‐job search models (hereafter OJS) is examined and an empirical investigation reported, using data collected by local offices of the Employment Services Division (hereafter ESD) of the Manpower Services Commission.
Minimum Wages, Union Membership and Differentials: The Phillips Curve and the Chilean Labour Market Revisited
Authors: Hojman David E.
Published: March 2008

Several Phillips curve models are presented and estimated with Chilean annual data for 1963–1982. Because of unreliable unemployment statistics, the real wage level is used to represent labour market disequilibrium. The Cortázar‐Marshall inflation index, alternative to the official one, and four different earnings variables are used. Equilibrium levels of earnings and equilibrium differentials are obtained. Market forces, expected inflation, structural change after 1973, and exogenous elements represented by a trend are all statistically significant; government‐determined minimum wage rates and union membership are not. There is no evidence of partial adjustment, and all equilibrium differentials increased during the period.
Gold Price as Another Determinant of Demand for International Reserves
Authors: Bahmani‐Oskooee Mohsen
Published: March 2008

Various authors have tried to verify the importance of different variables in the reserve demand equation. This article introduces a new independent variable, the gold price, into the reserve demand function. By pooling cross‐section and time‐series (quarterly) data for 19 industrial countries over the 1973–1981 period, a reserve demand equation is estimated. It is concluded that the price of gold exerts a significantly negative effect on the demand for international liquidity.
Merger Performance Evaluation: An Empirical Analysis of a Sample of UK Firms
Authors: Sturgess Brian , Wheale Peter
Published: March 2008

Governments in the US and the UK since the Second World War have taken a keen interest in competition policy. The Thatcher Government in the UK is no exception, and, indeed, a policy of deregulation of the nationalised industries has been instituted, whilst further legislation aimed at reducing the concentration of British industry is likely in the future. In such a political climate merger activity remains an important focus of concern. In this article the authors investigate the relative corporate profitability of growth by merger, including horizontal, vertical and diversifying acquisitions, as compared with that achieved by the internal acquisition of assets, and report on the results of their empirical analysis conducted from data on 52 UK public companies.
Techniques of Monetary Control in the United Kingdom
Authors: Cuthbertson Keith
Published: March 2008

“New measures” to aid monetary control introduced by the Bank of England in August 1981 are assessed with reference to the monetary base and “flow of funds” models of banking behaviour. Both models are found to be deficient in analysing the supply of “broad” money. However, theories of the banking firm highlight some problems in controlling a broad monetary aggregate. The “new measures” are viewed as a cautious approach to achieve greater flexibility in short‐term interest rates and to minimise the scope for disintermediation and hence are an improvement on previous arrangements for monetary control.
Smith and Shackle: History and Epistemics
Authors: Skinner Andrew S.
Published: March 2008

This article does not constitute a commentary on George Shackle either as an economist or as an historian. Rather it sets out to explain the reference to Smith which was introduced to the foreword of the 1983 edition of The Years of High Theory, and further to elaborate some striking similarities between two philosophers whose writings on the origin of theory are separated by more than 200 years.
Profit, Expectations and Coherence in Economic Systems
Authors: Loasby Brian J.
Published: March 2008

Professor Shackle is the most courteous, the most erudite, and the most radical critic of orthodox economics. The concept of profit, which apparently serves as such a convenient instrument of equilibrium, on closer enquiry is revealed to be necessarily subversive of such schemes of order; for profit can arise only where knowledge is not adequate to support any agreed — even probabilistically agreed — assessment of a situation. Thus any consideration of Professor Shackle's (1972, Chapter 35) discussion of profit focuses our attention on the insufficiency of knowledge which is the core of his criticism of orthodoxy. It should be no surprise, therefore, to find that the problem of coherence within economic systems resembles the problem of coherence in the growth of knowledge. Both appear to depend upon a productive but precarious tension between imaginative conjectures and a framework of serviceable conventions within which they may be tested.
How Economists can Accept Shackle's Critique of Economic Doctrines without Arguing Themselves out of their Jobs
Authors: Earl Peter E. , Kay Neil M.
Published: March 2008

The methodology of mainstream neoclassical economics deals with knowledge deficiency problems in a deterministic manner and as “refinements to the theory of economic action rather than rudiments of it” (Coddington, 1975, p. 151). For Shackle (1972), such an approach to the subject is unacceptable, since its deterministic nature is fundamentally at odds with his argument that, to be meaningful, choice must make a difference to the unfolding skein of events. Central to his view of the nature of choice is clearly a rejection of the concept of equilibrium and of the assumptive fiction that co‐ordination is achieved, on a once‐and‐for‐all basis, via the costless efforts of an omniscient auctioneer. If choices are meaningful in Shackle's sense, the skein of events contains many surprises, many incentives for agents to rethink their views of things and change their behaviour. For example, the workings of a multiplier process falsify expectations and these surprises may then spark off euphoric or depressing super‐multiplier effects. In markets for financial assets, “bulls” and “bears” cannot both be right in their predictions, while in product markets the creative exercise of marketing and research and development personnel's imaginations may continuously send out waves and backwashes in keeping with Schumpeterian notions of creative destruction. If one accepts Shackle's alternative starting point, one must sacrifice notions pertaining to “given” preferences and technologies and, with them, the stable functions upon which IS‐LM macro models (see Shackle, 1982(a)) and orthodox value theory are built.
Shackle's Theory of Decision Making under Uncertainty: Synopsis and Brief Appraisal
Authors: Ford J.L.
Published: March 2008

In recent years Professor Shackle's numerous, highly imaginative and original works on the role of expectation and uncertainty in the modelling of economic behaviour have at last become more widely acknowledged. However, still relatively little attention is paid to one of his seminal and earliest studies, that concerned with his own theory of expectations and individual decision making under uncertainty, work on which was begun and published in the 1930s and completed in 1949 with the appearance of the first edition of Expectation in Economics. Thereafter, until the early 1960s, his theory received a modest amount of interest. However, it tended to become neglected; reference rarely appears to it in books or papers on expectation, even in those papers discussing decision making under uncertainty (see, as one of the latest examples, G. O. Schneller and G. P. Sphicas, 1983). The literature has been dominated by the risk‐based, expected utility approach to decision taking.
Asset Markets and the Exchange Rate: A Structural Model of the Sterling‐Dollar Rate 1972–1982
Authors: Kearney Colm , MacDonald Ronald
Published: March 2008

This article formulates, estimates and simulates a structural model of the sterling‐dollar exchange rate over the floating rate period. A critique of existing empirical implementations of the asset‐market approach is followed by formulating a small structural model which augments a carefully specified asset sector with a real sector so that output and prices are determined endogenously along with interest rates, foreign reserves and the exchange rate. The model is estimated on quarterly data using Two Stage Least Squares and Zellner's Seemingly Unrelated Regression Procedure. Some policy simulations illustrate the response of the sterling‐dollar rate to various shocks.
Monetary Aggregates, Income and Causality in a Developing Economy
Authors: Kamath Shyam
Published: March 2008

This paper uses Sims‐Granger causality to examine the causal relationships between (1) the money stock and income, and (2) the reserve money base and the money stock for India. These relationships are empirically investigated so as to determine the role of money in economic activity and the role and channels of monetary policy in a developing economy. Both the conventional regression method used by Sims and the more recent time‐series method developed by Box and Jenkins are utilised in the tests. The results indicate (a) that money does not play a causal role in economic activity while conventional money‐demand functions with income as the right‐hand side variable are vindicated, and (b) there is weak support for the Central Bank's alleged control over the money stock through control over the reserve money base. The differing nature of the results with respect to the two methods adopted point towards the sensitivity of the Sims‐Granger causality test to the type of filtering procedure chosen.
Federal Reserve Money‐Supply Announcements and the Behaviour of UK Interest Rates
Authors: Peel D.A. , Pope P.F.
Published: March 2008

The purpose of this note is to examine the impact of US money‐supply announcements on United Kingdom interest rates using weekly data over the period 1977 to 1982. We find some evidence for the proposition that surprise increases in the US money supply increased UK interest rates over our sample period.
Review Article: Demand Management — An Obituary
Authors: Minford Patrick
Published: March 2008

I have given this review article its provocative title, not because the book with which it is associated is bad or should be buried. On the contrary, the book, as one would expect from the authors, is an extremely intelligent and well‐argued application of available techniques to the problem of designing demand management policies for the British economy. I have so entitled my piece because the book brought home to me, through its clarity and honest fullness of detail, just how impractical, undesirable and unlikely to appeal even to the British politicians of the centre‐left to whom they are offered, these policies are. Demand management has been a blind alley, and so, indeed, has the incomes policy which is part of the formula recommended in this book; the solutions to our problems lie along other lines and modes of thought.
Reform of Tax Reliefs for Owner‐Occupation
Authors: Welham P.J.
Published: March 2008

The article looks at the different distributional patterns of two alternative ways of reforming relief for owner‐occupation in UK, namely the reintroduction of income tax on imputed rent (the optimal reform, assuming housing is an investment good) or the withdrawal of tax relief for mortgage interest payments (possibly the more likely political reform). Inland Revenue data show that removal of mortgage interest relief (exclusive of the Option Mortgage) would be the more progressive measure. Removal of relief at higher rates of tax would be one possible step on the road to reform of mortgage interest.
Basic Causes of Soviet Industry's Low International Competitiveness
Authors: Fakiolas T.
Published: March 2008

This article examines why Soviet industrial, and especially engineering products are not, as a rule, internationally competitive, although the USSR, for nearly half a century now, ranks second in world industrial and engineering output. It is ascertained that the low competitiveness is due to the low quality and technological level of the products and is a result of hasty industrialisation and the lack of a creative scientific and enterprising climate, which prevents the country from utilising efficiently its enormous potential.
The Economics of Professional Team Sports: A Survey of Theory and Evidence
Authors: Cairns J. , Jennett N. , Sloane P.J.
Published: March 2008

Since the appearance of Simon Rottenberg's seminal paper on the baseball players' labour market in theJournal of Political Economy(1956), the literature on the economics of professional team sports has increased rapidly, fuelled by major changes in the restrictive rules which had pervaded these sports, themselves a consequence of battles in the courts and the collective bargaining arena. These changes have not been limited to North America, to which most of the literature relates, but also apply to Western Europe and Australia in particular. This monograph surveys this literature covering those various parts of the world in order to draw out both theoretical and empirical aspects. However, to argue that the existence of what is now an extensive literature “justifies” such a survey on professional team sports clearly begs a number of questions. Justification can be found in at least two major aspects.
The Economic Impact of Taxes in the US: Some Tests Based on the St. Louis Model
Authors: Darrat Ali F.
Published: March 2008

The primary purpose of this article is to investigate empirically for the US the potential impact of monetary and fiscal policy upon real economic activity using the “St. Louis equation” approach. Only lagged values of the policy variables are included in the estimation to ensure their statistical exogeneity. Hsiao's (1981) multivariate technique is employed to determine the model lag specification. The empirical results suggest that only fiscal policy as measured by high‐employment tax changes can exert a significant lasting impact upon real GNP. Monetary policy, on the other hand, has only a temporary effect on real GNP. The results also show that both monetary and fiscal policy have significant and permanent effects on nominal GNP, the former via its permanent effect on prices and the latter through its permanent effect on real GNP.
Entry and Market Characteristics: A Logit Study of Newspaper Launching in the Republic of Ireland
Authors: Thompson R.S.
Published: March 2008

The author uses multiple logit analysis to investigate and explain variations in the success of new entrants to the Irish provincial newspaper industry. Using local geographical markets, he concludes that area and income per head are the strongest positive influences on successful and unsuccessful entry.
Earnings and Job Mobility: Professional Chemists in Britain
Authors: Creedy J. , Whitfield K.
Published: March 2008

Examining the process of job mobility and its effect on earnings, the authors find that this particular labour market is characterised by a high incidence of specific training, that upward mobility is largely experienced within the same organisation and is mainly of the osmotic type. It is felt that a technique must be devised to measure osmotic mobility accurately.
An Assessment of Cyprus' Association with the EEC
Authors: Perdikis Nicholas
Published: March 2008

This article assesses the impact of Cyprus' agreement of association on the development and maintenance of trade with the EEC and Britain. It begins with a description of Cyprus' economic and trading structure and the agreement of association. The analysis is carried out by examining the growth rates of trade to and from the EEC and Britain at an aggregate and disaggregated level. Comparisons are made between these and those for other Mediterranean and less‐developed countries. Ex‐post income elasticities are also examined in a similar way. The study concludes that the agreement hindered the development of trade between the EEC and Cyprus.
On Incomplete Current Information and Empirical Tests of the Rational Expectations Hypothesis
Authors: Peel D.A.
Published: March 2008

The purpose in this article is to examine some implications which arise from assuming agents faced a mixed information structure for some standard tests of the rational expectations hypothesis.
International Migration, Remittances and Economic Welfare in the Source Country
Authors: Rivera‐Batiz Francisco L.
Published: March 2008

This article provides a formal framework for the analysis of the impact of international migration in the presence of remittances. The discussion differentiates between temporary and permanent migration and between the effects of remittances that raise investment and those that raise consumption spending in the source country. Changes in prices, income distribution and national welfare are examined.
The Determinants of the Coverage of PBR Systems in Britain
Authors: Elliott R.F. , Murphy P.D.
Published: March 2008

This article examines the incidence and determinants of payment‐by‐results systems in Britain. Data at the establishment level are used to estimate a probit model which identifies those structural characteristics that impact on the choice of payment system for manual workers.
UK Companies' Demand for Money: An Empirical Study, 1974–1983
Authors: Evans David J.
Published: March 2008

The article is concerned with company demand for broad money in the post‐Competition and Credit Control period. Equations are estimated for (a) all industrial and commercial companies and (b) a sample of large manufacturing and non‐manufacturing companies. The main findings are (1) that economies of scale in money holdings are only evident for large companies, (2) that only the large manufacturing companies respond significantly to changes in long‐term interest rates and (3) that adjustment of money holdings to changes in income and interest rates is completed within six months.
Growth of Income and the Balance of Payments: Keynesian and Monetary Theories
Authors: Beladi Hamid , Biswas Basudeb , Tribedy Gopal
Published: March 2008

With regard to the effect of growth on the balance of payments of a country, the conclusion of the Keynesian theory of income determination sharply differs from that of the monetary theory. This article suggests an integrated approach towards the derivation of the import function and the balance of payments equation for a money‐using economy from the utility‐maximising behaviour of individuals. Thereby, it shows that the difference between the conclusions of the two theories results from an incorrect specification of the balance of payments equation in the Keynesian theory.
On the Division of Labour and International Trade: or, Adam Smith's Explanation of Intra‐Industry Trade
Authors: Pomfret Richard
Published: March 2008

Adam Smith's dictum that the division of labour is limited by the extent of the market is invoked as an explanation of observed intra‐industry trade. The strongest results from empirical studies of intra‐industry trade (relating it to level of development, time, falling trade barriers, and a manufacturing dummy) are all consistent with this view. Moreover, it makes it unnecessary to argue whether such trade reflects an aggregation problem, or to rely on new theories of international trade based on product differentiation and scale economies (neither of which have performed well in econometric work in this area).
Natural Law and the Political Economy of Henry George
Authors: Sandilands Roger J.
Published: March 2008

Henry George's fame in the fields of economics, politics and literature rests largely on his powerful book,Progress and Poverty, first published in 1879. The centenary of this event sparked a modest revival of interest in George's work among academic economists, including a special session devoted to him at the December 1979 American Economics Association meetings in Atlanta. Generally, however, his work has been neglected by twentieth‐century economists and, as Robert Heilbroner (1969) remarked, he is cast as a member of the economics “underworld”. If any economics undergraduate has heard his name it is usually through a passing reference in a first‐year textbook to the Single Tax Movement. The impression is then given by the text that George was a single‐issue fanatic. The student is told that a tax on land rents is theoretically interesting and that it would have no disincentive effects but that it is either impractical to separate land from improvements or that rents are not sufficiently important to warrant much attention to them as a major source of government finance.
Marshall's Economics of Progress
Authors: Loasby Brian J.
Published: March 2008

Style and Purpose “It's all in Marshall”. There is more truth in that once‐familiar claim than there would be in a similar claim about any other economist; yet as Samuelson (1967, p. 25) rightly observed, what is in Marshall cannot be revealed by the reading of Marshall alone. What one sees is very largely a reflection of one's own viewpoint; often it is only after thinking about a specific issue that one realises that Marshall had thought about it too, and had set down his ideas in his usual unemphatic way, as if they were already common property. His manner is very different from that of Hicks, who always explains what he is doing and why; neither in the Principles (1961) nor in Industry and Trade (1919) does Marshall attempt to distinguish his own contributions, though frequently acknowledging those of others; and his clear views on how economists should proceed, though not suppressed, are not allowed to mark out a distinctively Marshallian programme. As a consequence, though he gained a great reputation, his ideas have had very little influence.
Decision Making under Uncertainty: In Defence of Shackle
Authors: Stephen Frank H.
Published: March 2008

In a series of books beginning in 1949 with Expectation in Economics, G.L.S. Shackle has analysed business decisions made under conditions of uncertainty (see Shackle, 1949,1955,1961,1970). In these he rejects the orthodox, probability‐based, approach of expected utility theory and outlines his own “model” of the decision process. This “model” is outlined in the next section. A number of criticisms which have been made of the Shackle theory are discussed in the third section together with responses which seek to preserve the underlying spirit of Professor Shackle's approach. The fourth section examines the relative merits of the orthodox mode of analysis and that of Professor Shackle as rationalisations of the judicial standard of negligence used in England and the United States.
The Theory of Monopolistic Competition: E.H. Chamberlin's Influence on Industrial Organisation Theory over Sixty Years
Authors: Rothschild R.
Published: March 2008

In 1933, Edward H. Chamberlin published the Theory of Monopolistic Competition (1962). The work, based upon a dissertation submitted for a PhD degree in Harvard University in 1927 and awarded the David A. Wells prize for 1927–28, has since become a milestone in the development of economic thought. Its impact on industrial organisation theory, general equilibrium and welfare economics, international trade theory and, to a greater or lesser degree, all other branches of economic analysis, has been pervasive and enduring. The ideas set out in the book have been developed, expanded and refined in ways too numerous to be identified precisely, and the books and articles which take Chamberlin's contribution as a starting point arguably exceed in number those on any other single subject in the lexicon of economics.
The Non‐Equivalence of Tariffs and Quotas: An Extension
Authors: Reiber William J.
Published: March 2008

Casas and Choi (1985) suggest that a quota imposed exactly at the free trade level of imports could affect domestic prices and quantities in the presence of monopoly. They state (pp. 56–57): “An interesting corollary of this analysis is that an import quota set equal to the free trade volume of imports will be ineffective (i.e. non‐binding) but not redundant when the import competing industry is monopolised. In particular, such a quota would result in a higher domestic price and lower domestic output and consumption than under free trade.” This note extends the discussion in Casas and Choi by showing that an import quota may not be redundant even if it is set at a level greater than the free trade volume of imports. This possibility is shown to arise in both the small country and large country cases.
Export Instability in Less Developed Countries: Consequences and Causes
Authors: Love James
Published: March 2008

The issue of export instability exerts an enduring fascination for economists with an interest in the area of economic development. Over several decades a voluminous literature has emerged embracing debates on the domestic consequences and on the causes of export instability. The purpose here is to examine these debates and an attempt is made to set out different theoretical stances, to classify and examine empirical findings, and to indicate the directions in which the debates have moved. Such a statement of a review article's purpose is, of course, incomplete without more specific delineation of the boundaries within which the general objectives are pursued. Here that delineation has three facets.
The Impact of Political Change, Debt Servicing and Fiscal Deficits on Argentinian Budgetary Priorities
Authors: Looney Robert E.
Published: March 2008

The turbulent world economic conditions of the 1970s and 1980s have required major adjustments within individual Third World countries. Two distinct responses were made by various governments: some reacted rather quickly with internal adjustment policies, while others borrowed heavily in order to finance high growth rates or at least to postpone economic contraction. Argentina is one of many countries that fall into the latter category.
The Determinants of the Demand for Internationally Traded Primary Commodities: An Empirical Analysis
Authors: Sapsford David
Published: March 2008

This article presents an empirical analysis of the demand for internationally traded primary commodities. The article is organised as follows: the first section sets out the model of commodity demand, the next reports and discusses the empirical findings. The final section summarises the article's main findings and offers some concluding remarks.
The Buy‐American Practices of the US Defence Department and their Repercussions
Authors: Apostolakis Bobby E.
Published: March 2008

As tariffs on trade have been drastically reduced after lengthy negotiations, non‐tariff barriers to trade have assumed increasing relative importance. This article examines the “Buy‐American” policy of the US Defence Department which may be classified as a restrictionist procurement tactic. The term Buy‐American refers to the systematic preference for domestic products which is in effect a form of trade discrimination. More specifically, we are interested in calculating the social welfare costs caused by the Buy‐American discrimination of the Defence Department.
The Policy Relevance of The General Theory
Authors: Pressman Steven
Published: March 2008

Keynes taught us in The General Theory that neither economic depressions nor fluctuations were inevitable. If nothing is done, these problems would continue. However, by the judicious employment of economic policies, these problems could be mitigated, if not totally remedied.
The Radcliffe Central Bankers
Authors: Wulwick Nancy
Published: March 2008

This article analyses documents before the Radcliffe Committee on the Working of the Monetary System. The proceedings of the Radcliffe Committee are recognised as providing a watershed in the history of monetary thought, particularly as pertains to the propositions of post‐Keynesian monetary economics. These propositions, recently detailed in two books (Rousseas, 1968; Moore, 1987), can be summarised as follows:
Time Horizons of Management Decisions: Causes and Effects
Authors: Tylecote Andrew
Published: March 2008

There has been a long debate, with an extensive literature, over the control of the firm: who controls it, and how, and what implications does this have for managerial objectives and performance? It is not too simplistic to describe the argument for the most part as between those who see control by shareholders predominating, with the consequence that profit maximisation is the objective, and those who stress control by managers, leading to some other objective being followed — there being many and various alternatives canvassed (e.g. Marris, 1964; Leibenstein, 1966). In recent years, the partisans of shareholder control have been stressing the scope for it even where there was no single holding, or group of holdings, even approaching a majority of the shares. (For the US, see, among others, the Patman Report (1968) and Mintz et al. (1985); for the UK, see Francis (1980a), and Nyman and Silberston (1978)).
Remittances and Income Distribution
Authors: Milanovic Branko
Published: March 2008

The objective of this paper is to examine the affect of foreign remittances on the distribution of incomes in the home country. As noted recently by Stark, Taylor and Yitzhaki (1986), there are few works which deal with the distributional impact of revenues from abroad. This is probably due to the lack of adequate data, since the available data in most instances refer only to the overall magnitude of transfers (i.e. are considered almost exclusively from a balance of payments perspective). More empirical information on the distributional effects of workers' remittances is needed for the following reason. Existence of remittances can no longer be considered a transitory phenomenon. The importance of inter‐country migrations remains high and remittances continue to provide a substantial portion of foreign exchange resources for a number of countries. Their distributional effects cannot be ignored. Thus even if migration and the inflow of remittances associated with it do raise welfare in the source country when income distribution is implicitly assumed unchanged (see Djajic, 1986) the effects can be ambiguous once this assumption is relaxed. If remittances tend to lower overall income inequality their effect can be both positive in welfare terms and politically stabilising. The reverse, however, holds if they lead to an increase in income inequality.
Effective Protection and Intra‐Industry Trade: Some Positive and Normative Issues
Authors: Greenaway David , Milner Chris
Published: March 2008

The distinction between nominal and effective tariffs (or protection) is well established in the theoretical literature, albeit in the context of the traditional analysis of inter‐industry trade flows. This analysis is based upon assumptions such as product and production homogeneity, non‐increasing returns, armslength trade, and small open economy country conditions. Relaxation of some or all of these assumptions has direct implications for effective protection analysis under any type of trade flows. As is now widely recognised, however, relaxation of these assumptions is also likely to be associated with intra‐industry specialisation and exchange. It is to this wider issue of effective protection analysis in the context of “within‐industry” specialisation (vertical and/or horizontal) and of two‐way trade, that this paper is addressed.
Review Article: The Economics of Health
Authors: Brooks R.G.
Published: March 2008

Health economics is now a well‐established topic within the discipline of economics. A 5,500‐item bibliography covering material up to 1982 is available (Blades et al, 1986). Health economists write on such diverse matters as (to select at random) demand for acute care in hospitals, the costs of illness, the economics of alcoholism, cost‐benefit analysis in magnetic resonance imaging, and the pros and cons of any number of ways of financing the delivery of health services. Here in the UK the Health Economists' Study Group boasts around 150 members. Meanwhile, hardly a day goes by without the newspapers containing items concerning topics which could form the basis for health economists' involvement in analysis, evaluation and, in some cases, policy advice. The jargon of economics and evaluation is becoming familiar to a wider audience: thus articles on cost‐effectiveness and cost‐benefit analysis appear regularly in medical journals and the quality‐adjusted life‐year (QALY) has featured on TV. Thus a review of some of the recently published books in this area would appear appropriate at this juncture.
Cohort and Cross‐sectional Earnings Profiles: Scientists in Britain and Australia
Authors: Creedy John
Published: March 2008

It has long been recognised that cohort and cross‐sectional age‐earnings profiles differ. A standard procedure, which is quite reasonable in the absence of more information, is to obtain a cohort profile by simply adding the general rate of growth of real earnings to the growth of earnings associated with age, as shown by cross‐sectional data. Indeed, this would seem to be supported by the observation that cross‐sectional earnings profiles for a number of different years show a great deal of stability in their general shape. The main question considered here is whether cohort profiles can in fact be estimated in this simple way. A basic statistical model of age‐earnings profiles is described in the next section. The model is then applied to several groups of professional scientists, chemists and physicists in Britain and Australia, in the third section. The data were obtained from special surveys of career histories and are described briefly in the Appendix. A feature of the surveys is that sufficient data were collected to enable separate analyses of male and female scientists to be carried out.
Stabilisation Targets and Instruments in Developing Countries
Authors: Clunies Ross Anthony
Published: March 2008

The assignment of targets to instruments in developing countries cannot satisfactorily follow any simple universal rule. Which approach is appropriate is influenced by whether the economy is dominated by primary exports, by the importance of the domestic bond market and bank credit, by the extent of existing restriction in foreign exchange and financial markets, by the presence or absence of persistent high inflation, and by the existence or non‐existence of an active international market in the country's currency. Eighteen observations and maxims on stabilisation policy are tentatively drawn (pp. 64–8) from the material reviewed, and the maxims are partly summarised (pp. 69–71) in a schematic assignment, with variations, of targets to instruments.
Carl Menger, Author of a Research Programme
Authors: Zuidema J.R.
Published: March 2008

In the development of the science of economics, two periods of major importance can be distinguished — the middle of the eighteenth century and the last 30 years of the nineteenth century. In the former period, the heyday of the Enlightenment, it was recognised that the domain of production, distribution and market exchange should be studied as an important aspect of the social order. In that short period the foundations were laid for a more or less autonomous science of economics. It took about a century, however, to establish economics as a separate science with its own institutions: its own departments in the universities, its own language, its own journals, its own congresses, its own standards to distinguish the initiates from the laymen. Thattour de forcewas accomplished in the last three decades of the nineteenth century. It was the introduction of marginalism that gave economics its special modern flavour. Carl Menger can justly be seen as one of the founding fathers of economics in its twentieth‐century garb.
On the Austrian Notion of “Cost” in 1889
Authors: Elzas B.D.
Published: March 2008

Suppose that an isolated colonist has just reaped his grain crop. The yield is five full sacks. He destines each sack for a specific purpose: the first sackful of grain must serve him to survive, the second one to keep him in full strength, the third will serve as fodder for his poultry, enabling him to enrich his diet with meat. He plans to use the fourth for distilling corn brandy, a luxury to him. For lack of better he destines the fifth sackful of grain for feeding his parrots: their antics amuse him. So, unmistakably, the five uses are of diminishing importance to him.
Austrian Thinking on International Economics
Authors: Visser H.
Published: March 2008

The epithet “Austrian” in “Austrian economics” is applied to the work of economists as far apart in time as Carl Menger, whose Grundsätze der Volkswirthschaftslehre (Principles of Political Economy) first appeared in 1871, and Ludwig Lachmann, Israel Kirzner and Murray Rothbard, writing a century or more later. It would be vain to attempt to define Austrian economics by a set of beliefs, commonly held by its adherents. There is much to be said for following Zuidema (1987), who prefers to speak of “styles” rather than “schools”. This implies that there need be no clear‐cut dividing lines between Austrians and the rest of the economics fraternity and that not all those dubbed “Austrian” are necessarily “typically” Austrian all of the time. There certainly seems to be a style of reasoning that can be seen as specifically Austrian. Some of the components of a “style” mentioned by Zuidema are:
Intra‐industry Trade, Aggregation and the HOS Model
Authors: Rodgers Joan R.
Published: March 2008

It seems to be well understood that the simultaneous import and export of goods which have different production functions, but which are aggregated into the same industry in classification schemes such as the SITC, is quite consistent with the standard trade theory of the Heckscher‐Ohlin‐Samuelson (HOS) model. For example, Grubel and Lloyd (1975, p.87) admit that two‐way trade in products such as wood and metal furniture, or nylon and wool yarn, which have similar end uses but different input requirements, can be explained readily by the HOS model (1979, p. 88). Gray explicitly distinguishes between “categorical aggregation” which occurs when there is two‐way trade in goods with different production functions and is consistent with the HOS model, and “true intra‐industry trade” which occurs when a country imports and exports “goods with virtually identical production functions”.
United States Market Share of Latin American Wheat Imports: Disaggregated Analysis and Application of the Armington Model
Authors: Shalaby Seif , Yanagida John F. , Hassler James B.
Published: March 2008

During the period 1966/67–1984/85, the United States market share in the global wheat trade averaged 41 per cent. Recently, this percentage has declined considerably after a period when the US agricultural sector expanded rapidly to meet the needs of growing world markets. The US market share of wheat trade reached an all‐time high of 48 per cent in 1981/82 then steadily declined to 37 per cent in 1984/85.
Government Deficit Financing and Stabilisation
Authors: Sang Ho Lok
Published: March 2008

The US federal deficit has, over the years, remained a subject of widespread concern and controversy. Diverse views continue to be expressed on such questions as whether the deficit matters, whether it is the inflation‐adjusted deficit that matters, whether bond‐financed deficits are inflationary, and whether it is only deficits that are financed by money creation which are inflationary. Against this background, few would disagree with Boskin (1982) that “progress in improving our understanding of the role of the budget deficit in economic behavior and performance… is an urgent research priority”.
Diversifying Mergers and Risk: A Comment
Authors: Barr G.D.I. , van den Honert R.C.
Published: March 2008

In his article “Diversifying Mergers and Risk: Some Empirical Tests”, Thompson (1983) modelled the change in the systematic risk of the acquiring firm before and after merger. We propose a modification to this method which considers the difference between the systematic risk of the merged firm and that predicted by capital market theory on the basis of the constituent firms' betas. Furthermore merger will probably lead to a change in the structure of the acquiring firm, both intrinsically and financially. Thus in order to remove any complications caused by debt restructuring of the combined firm after merger, we suggest that the analysis is carried out using ungeared or intrinsic betas. An empirical study which follows that of Thompson but implements the above modifications is performed, and conclusions are drawn which have implications for studies that have considered the benefits of merger to the acquiring and target firms.
A Course between Scylla and Charybdis?: Cantillon's Theory of Distribution and Value
Authors: Grieve R.H.
Published: March 2008

Brewer's Study of Cantillon Anthony Brewer, introducing his study of Cantillon, recalls how favourably impressed he was as soon as he had read a page or two of the Essai (Essai sur la Nature du Commerce en Général, the only work by Cantillon we possess). Although written as early as around 1730, Cantillon's Essai is still extraordinarily fresh and thought‐provoking. Brewer very soon, as he says, recognized “a real theorist, of a really quite modern kind… (a theorist) with a clear vision of the economy as an interrelated system and a strikingly consistent analysis of how the system worked” (Brewer, p. ix).