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on Heterodox Microeconomics |
| By: | Stephen T. Ziliak (Roosevelt University) |
| Abstract: | In an article titled "Field Experiments in Economics: The Past, the Present, and the Future," Levitt and List (2009) make three important claims about the history, philosophy, and future of field experiments in economics. They claim that field experiments in economics began in the 1920s and 1930s, in agricultural work by Neyman and Fisher. Second, they claim that artificial randomization is the sine qua non of good experimental design; they claim that randomization is the only valid justification for use of Student‘s test of significance. Finally, they claim that the theory of the firm will be advanced by economists doing randomized controlled trials (RCTs) for private sector firms. Several areas of economics, for example the development economics of Banerjee and Duflo, have been influenced by the article, despite the absence of historical and methodological review. This comment seeks to fill that gap in the literature. Student has, it is found, priority over Fisher and Neyman; he compared balanced and random designs in the field—on crops from barley to timber—from 1905 to 1937. The power and efficiency of balanced over random designs - discovered by Student and confirmed by Pearson, Neyman, Jeffreys, and others adopting a decision-theoretic and/or Bayesian approach - is not mentioned by Levitt and List. Neglect of Student is especially regrettable, for he showed in his job as Head Brewer of Guinness that artificial randomization is neither necessary nor sufficient for improving efficiency, identifying causal relationships, or discovering economically significant differences. One way forward is to take a step backwards, from Fisher to Student. |
| Keywords: | field experiments, balanced, random |
| JEL: | B1 C9 C93 |
| Date: | 2011–06–30 |
| URL: | http://d.repec.org/n?u=RePEc:aah:create:2011-25&r=hme |
| By: | Kosovka Ognjenovic |
| Abstract: | In this paper is estimated the wage gap between the public and the private sector in Serbia, for women and men separately. The results show that, with advance of the transition, the public sector generates wage premium for those who work in that sector compared to the employed in the private sector. The public sector overpaid both men and women compared to their counterparts in the private sector, but the estimated wage premium for women is lower compared to the estimated wage premium for men (22.3 percent and 25.4 percent, respectively; both estimates are statistically significant). The only group of workers who are penalized for working in the public sector is comprised of women and men who have higher education. In order to estimate the sectoral wage gap by gender several regression models were used: the quantile regressions, the pooled OLS regression and the fixed-effects panel data model. The data that are used in the analysis are taken from the Serbian Living standard measurement surveys for 2003 and 2007. |
| Keywords: | transition, wage differences, public and private sectors, living standard measurement survey data |
| JEL: | J21 J31 J38 P2 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:wii:bpaper:bowp:091&r=hme |
| By: | Nadia Jacoby (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I) |
| Abstract: | Avec cet ouvrage paru en 1982, Nelson & Winter posent les bases d'une nouvelle théorie économique : la théorie évolutionniste. Cet ouvrage séminal est le fruit de près de 20 années de recherches, initiées avec l'article de Winter " Economic "natural selection" and the theory of the firm " paru en 1964 dans Yale Economic Essays. Partant d'une critique fondamentale de l'orthodoxie économique, et plus particulièrement d'une critique du principe de maximisation et de la recherche de solutions optimales, Nelson & Winter proposent une théorie alternative du changement économique. Pour cela, ils empruntent à la fois des idées simples à la biologie mais se réfèrent également à Schumpeter et à Simon envers qui ils expriment leur plus grande dette intellectuelle. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:hal-00605363&r=hme |
| By: | Federico Frattini |
| Abstract: | This paper approaches innovation as a need and not as a choice, particularly in the case of mature systems, defined as localized systems of production that are deeply specialised in mature industries. Their only strategy to achieve competitiveness is an innovation-driven shake-out combining new technological patterns with the existing resources and involving local institutions in production in order to avoid an unbearable shock. The Italian case is useful to introduce the idea of an institutional division of labour limited by the extent of the market and the institutional coherence of the system. According to this approach, the innovation policy has also a political dimension, which development and competition possibilities depend on. |
| Keywords: | Mature industry; Innovation; Institutions; Policy |
| JEL: | B52 L23 N64 O33 P16 |
| Date: | 2011–07–07 |
| URL: | http://d.repec.org/n?u=RePEc:udf:wpaper:201109&r=hme |
| By: | Jordi Guilera (Universitat de Barcelona) |
| Abstract: | Recent decades have been characterized by a steep increase in wage inequality globally. In order to explain this phenomenon, this paper extends the classic Kuznets Curve to include post-industrial economies. According to this Extended Kuznets Curve (EKC) hypothesis, wage inequality may follow an N-curve. If the inverted U-shape of the EKC is attributable to the structural changes associated with industrialization, its right-hand side reflects the boom in human capital formation registered in modern and post-industrial economies. Thus, the main candidates to explain the recent upsurge in wage inequality, namely skill-biased technical change, globalisation and institutional factors, may be embodied in the evolution of the skill composition of the labour force. The available empirical evidence, albeit limited, tends to support the EKC hypothesis. |
| Keywords: | wage inequality, portugal, kuznets curve |
| JEL: | O15 J24 N34 J21 D31 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:bar:bedcje:2011257&r=hme |
| By: | Anghel, Brindusa (FEDEA, Madrid); de la Rica, Sara (University of the Basque Country); Dolado, Juan José (Universidad Carlos III de Madrid) |
| Abstract: | This paper addresses the role played by Public Sector (PS) employment across different OECD labour markets in explaining: (i) gender differences regarding choices to work in either PS or private sector, and (ii) subsequent changes in female labour market outcomes. To do so, we provide some empirical evidence about cross-country gender differences in choice of employment in the PS vs. the private sector, using the European Community Household Panel (ECHP), in the light of different theories on gender behaviour in the labour market. We also analyze the main determinants of the hourly wage gaps across these two sectors for males and females separately. Finally, we document the main stylized facts about labour market transitions by male and female workers among inactivity, unemployment, working in the PS and working in the private sector. |
| Keywords: | labour market transitions, gender gaps, public sector employment |
| JEL: | J45 J16 J31 |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5825&r=hme |
| By: | Hampf, Anders (Department of Marketing); Lindberg-Repo, Kirsti (Department of Marketing) |
| Abstract: | Branding, as any other concept, has evolved over time: from the days when sheep of one herd started to be branded to distinguish them from another herd to the current era when everything, from water and flowers to clothes and food, is branded. Throughout these times, there have been numerous theories to describe and understand the underlying nuances. This paper finds the relationships in previous literature and reveals how these theories see branding from various perspectives and how they can be integrated to form a coherent view. It is also discussed how branding and society affect each other. Based on the knowledge of how branding theories have been developed as dependent variables of each other and the society, we are able to form a better understanding of the past, the present, and the future of branding |
| Keywords: | branding; evolution of branding; future; brand identity hexagon; the academic life cycle |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhb:hanken:0556&r=hme |
| By: | Vilppo, Tiina (Department of Marketing); Lindberg-Repo, Kirsti (Department of Marketing) |
| Abstract: | Purpose – This research paper studies how the strategy of repositioning enables marketers to communicate CSR as their brand’s differentiating factor. It aims at understanding how consumer perceptions can be managed to generate brand value through corporate brand repositioning when CSR is the differentiating factor. The purpose of this paper is to answer the following research question: How can consumer perceptions be managed to generate brand value through corporate brand repositioning when CSR is the differentiating factor? The two research objectives were: 1. to build a model, which describes the different components of consumer perceptions involved in generation of brand value through repositioning when CSR is the differentiating factor, 2. to identify the most critical components in the context of the case company, IKEA for generation of brand value during the process of corporate brand repositioning. Design/methodology/approach – This paper is based on the literature review covering the logic of brand value generation, repositioning strategy and consumer perceptions connected to CSR activities. A key concept of the positioning theory, the brand’s differentiating factor, was explored. Previous studies have concluded that desirability of the differentiating factor largely determines the level of brand value-creation for the target customers. The criterion of desirability is based on three dimensions: relevance, distinctiveness and believability. A model was built in terms of these desirability dimensions. This paper takes a case study approach where the predefined theoretical framework is tested using IKEA as the case company. When developing insights on the multifaceted nature of brand perceptions, personal interviews and individual probing are vital. They enable the interviewees to reflect on their feelings and perceptions with their own words. This is why the data collection was based on means-end type of questioning. Qualitative interviews were conducted with 12 consumers. Findings – The paper highlights five critical components that may determine whether IKEA will fail in its repositioning efforts. The majority of the critical components involved believability perceptions. Hence, according to the findings, establishing credibility and trustworthiness for the brand in the context of CSR seems primary. The most critical components identified of the believability aspect were: providing proof of responsible codes of conduct via conducting specific and concrete CSR actions, connecting the company’s products and the social cause, and building a linkage between the initial and new positioning while also weakening the old positioning. Originality/value – Marketers’ obligation is to prepare the company for future demands. Companies all over the globe have recognized the durable trend of responsibility and sustainability. Consumer´s worry about the environmental and social impact of modern lifestyles is growing. This is why Corporate Social Responsibility (CSR) provides brands an important source of differentiation and strength in the future. The strategy of repositioning enables marketers to communicate CSR as their brand’s differentiating factor. This study aimed at understanding how consumer perceptions can be managed to generate brand value through corporate brand repositioning when CSR is the differentiating factor. |
| Keywords: | corporate social responsibility; CSR; corporate brand; repositioning |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhb:hanken:0557&r=hme |
| By: | Coad, Alex (Science and Technology Policy Research (SPRU), Freeman Centre, University of Sussex); Daunfeldt, Sven-Olov (The Swedish Retail Institute (HUI) and Dalarna University); Johansson, Dan (The Ratio Institute); Wennberg, Karl (The Ratio Institute and Stockholm School of Economics) |
| Abstract: | The purpose of this paper is to study who high- growth firms (HGFs) hire using a matched employer-employee dataset for all knowledge intensive industries in Sweden, where high growth is measured over the period 1999-2002. The results indicate that HGFs to a larger extent employ young people, immigrants, and individuals with longer unemployment periods. However, these patterns seem contingent on the stage of firm evolution. HGFs that have already realized rapid growth seem to start focusing on hiring individuals from other companies, even though immigrants are still overrepresented among new employees. |
| Keywords: | Gazelles; firm growth; rapid firm growth; high-impact firms |
| JEL: | D24 L25 L26 |
| Date: | 2011–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0169&r=hme |
| By: | Verniers, I.; Stremersch, S.; Croux, C. |
| Abstract: | Research on the launch of new products in the international realm is scarce. The present paper is the first to document how launch window (difference in months between the first worldwide launch and the subsequent launch in a specific country) and launch price are interrelated and how regulation influences both launch window and launch price. The research context is the global – 50 countries worldwide – launch of 58 new ethical drugs across 29 therapeutic areas. We show that the fastest launch occurs when the launch price is moderately high and the highest launch price occurs at a launch window of 85 months. We find that the health regulator acts strategically in that the extent to which it delays the launch of a new drug increases with the price of the new drug. We also find that regulation overall increases the launch window, except for patent protection. Surprisingly, regulation does not directly impact launch price. The descriptive information on average launch window and launch price and the interconnection between launch window and launch price allows managers in ethical drug companies to build more informed decisions for international market entry. This study also provides public policy analysts with more quantitative evidence regarding launch window and launch price on a broad sample of countries and categories. |
| Keywords: | entry timing;international new product launch;launch price;launch window;pharmaceutical;regulation |
| Date: | 2011–05–03 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:eureri:1765023488&r=hme |
| By: | Eduardo da Motta e Albuquerque (Cedeplar-UFMG) |
| Abstract: | Despite the lack of consensus on the appropriate concept of ‘social capital’, research in the area has continued even in the most criticized macroeconomic area. The investigation about the importance of social capital to generate differences in regional per capita income (per capita income growth rates) had new contributions in the last decade. Robustness analysis was carried on for cross-country analysis and interregional studies were explored. Empirical research was usually based on the idea that social capital is ‘norms, networks and trust’, although without a deep discussion about this choice. We will argue that the acceptance of this pragmatic concept was wise, not only because it allowed empirical research to follow one, but also because it is theoretically well established. We will also argue that the concern about robustness is one of the main ways ahead to the macro research, which was exactly the way followed by this literature. In other words, we will argue that economists follow a good practice in the episode and that the fruits of the research allow us to rethink and improve the way economists behave. |
| Keywords: | Roman Rosdolsky suggests a method to deal with the transition towards socialism that integrates three issues: 1) the identification of dynamic features of capitalism; 2) the systematization of metamorphoses of capitalism; 3) the evaluation of how these metamorphoses reshape the elaboration of alternatives to capitalism. This evaluation is a precondition for the visualization, within the complex dynamics of capitalism, of seeds of a new society – institutions born out of political struggles and of emancipatory features of key social processes. These institutions reshape the nature of the metamorphoses of capitalism – and the possibility of establishing socialism and democracy. |
| JEL: | B51 B52 |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:cdp:texdis:td431&r=hme |
| By: | Cardone Riportella, Clara; Cazorla Papis, Leonardo |
| Abstract: | The article analyzes the factors determining the capital structure of the Spanish small and medium enterprises [SMEs]. The analysis is grounded on the agency theory, the signalling approach and the pecking order theory. In particular, the article provides a qualitative and quantitative analysis about the impact of company brand, the ownership and control structure, and the relationship between the SMEs and their own financial policy. This analysis is based on defining the expected relationships that one might consider between the referred variables and the total debt ratio. In this regard, the analysis will be conducted by means of considering a survey of 410 Spanish SMEs where an ANOVA test will be applied. Then, a hierarchical regression model will allow comparison of the hypotheses made. |
| URL: | http://d.repec.org/n?u=RePEc:ner:carlos:info:hdl:10016/7190&r=hme |
| By: | Arellano, F. Alfonso |
| Abstract: | This study analyses the effects on unemployment and the quality of employment of the Spanish labour market reform in 2001 for the most important age groups. The content of the reform was based on the implementation of two policies: (i) a new permanent contract with lower firing costs than the ordinary one, and (ii) the reduction of the payroll taxes paid by firms to foster creation/ conversion of/ into permanent contracts. This reform extended to further groups of workers similar measures adopted in a previous reform in 1997. Using a data base of unemployed workers in the region of Madrid from January 1997 up to September 2003, and methods for non-experimental data, the results suggest that, regardless of gender, workers below 30 years are negatively affected by the reform, and workers above 55 years show positive but small effects. The influence of the reform for workers between 45 and 50 years is negligible. As regards education, graduates are more sensitive to the reform than workers with a lower level of education (primary and secondary education). |
| URL: | http://d.repec.org/n?u=RePEc:ner:carlos:info:hdl:10016/334&r=hme |
| By: | Martin Berka; Michael B. Devereux; Thomas Rudolph |
| Abstract: | We study a newly released data set of scanner prices for food products in a large Swiss online supermarket. We find that average prices change about every two months, but when we exclude temporary sales, prices are extremely sticky, changing on average once every three years. Non-sale price behavior is broadly consistent with menu cost models of sticky prices. When we focus specifically on the behavior of sale prices, however, we find that the characteristics of price adjustment seems to be substantially at odds with standard theory. |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:acb:camaaa:2011-19&r=hme |
| By: | Deepankar Basu |
| Abstract: | Three important features of the U.S. economy during the neoliberal era since the mid-1970shave been: (a) growing financialization, (b) increasing household debt, and (c) stagnant real wages for production and nonsupervisory workers. This paper develops a discrete-time Marxian circuit of capital model to analyze the links between these three features and economic slowdown. The discrete-time model is used to address two important theoretical issues of general interest to the heterodox economic tradition: profit-led versus wage-led growth, and the growth-reducing impact of non-production credit. First, it is demonstrated that both profitled and wage-led growth regimes can be accommodated within the Marxian circuit of capital model. Second, it is demonstrated that the steady-state growth rate of a capitalist economy is negatively related to the share of consumption credit in total net credit, when the total credit is large to begin with. Bringing these two results together, the paper demonstrates that the three characteristics of the U.S economy under neoliberalism can have a growth-reducing impact on a capitalist economy. Hence, this paper oers a novel explanation, rooted in Marx’s analysis of the circuits of capital, of the slowdown of the U.S. economy during the neoliberal period. |
| URL: | http://d.repec.org/n?u=RePEc:rmf:dpaper:30&r=hme |
| By: | Michael W. L. Elsby; Jennifer C. Smith; Jonathan Wadsworth |
| Abstract: | Unemployment varies substantially over time and across subgroups of the labour market. Worker flows among labour market states act as key determinants of this variation. We examine how the structure of unemployment across groups and its cyclical movements across time are shaped by changes in labour market flows. Using novel estimates of flow transition rates for the UK over the last 35 years, we decompose unemployment variation into parts accounted for by changes in rates of job loss, job finding and flows via non-participation. Close to two-thirds of the volatility of unemployment in the UK over this period can be traced to rises in rates of job loss that accompany recessions. The share of this inflow contribution has been broadly the same in each of the past three recessions. Decreased jobfinding rates account for around one-quarter of unemployment cyclicality and the remaining variation can be attributed to flows via non-participation. Digging deeper into the structure of unemployment by gender, age and education, the flow-approach is shown to provide a richer understanding of the unemployment experiences across population subgroups. |
| Keywords: | labour market, unemployment, worker flows |
| JEL: | E24 J6 |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1058&r=hme |
| By: | Schilirò, Daniele; Graziano, Mario |
| Abstract: | This paper argues critically the issue of choices and rationality in economic models through a multidisciplinary analysis. First, the analysis aims at highlight the scientific contributions of psychology in economics, since psychology and the related approach of cognitive economics has made more complex and problematic the analysis of choices of the standard neoclassical economics. The cognitive approach in economics has pointed out the complexity of the choice process and the unsolved relationship between economic and psychological dimensions of such a process, showing the biases and the limits of rationality. Second, the analysis focuses on the use of evolutionary concepts in economic theory. Economic models, which are consistent with an evolutionary approach, have necessarily to be very different from those of standard economics. In particular, this paper examines the works of Alfred Marshall, since he is the first major economist to refer explicitly to biology for explaining economic evolution. The purpose of the analysis is to reveal the conditions required to succeed in building a real evolutionary model. A major condition, which is found in Marshall models, particularly in his Principles of Economics, is the understanding and the integration of darwinian philosophical matrix in his general economic approach. The paper, therefore, aims at demonstrating that economics has not been historically a discipline homogenously aligned to a single, undifferentiated form of thought, locked into the idea of perfect rationality, but that is a discipline that enriched and still enriches itself by contributions and contaminations from other disciplines. |
| Keywords: | scelta; razionalità; economia cognitiva; modelli evolutivi; biologia |
| JEL: | D81 B52 D90 D01 |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:31910&r=hme |
| By: | Lee G. Branstetter; Chirantan Chatterjee; Matthew Higgins |
| Abstract: | With increasing frequency, generic drug manufacturers in the United States are able to challenge the monopoly status of patent-protected drugs even before their patents expire. The legal foundation for these challenges is found in Paragraph IV of the Hatch-Waxman Act. If successful, these Paragraph IV challenges generally lead to large market share losses for incumbents and sharp declines in average market prices. This paper estimates, for the first time, the welfare effects of accelerated generic entry via these challenges. Using aggregate brand level sales data between 1997 and 2008 for hypertension drugs in the U.S. we estimate demand using a nested logit model in order to back out cumulated consumer surplus, which we find to be approximately $270 billion. We then undertake a counterfactual analysis, removing the stream of Paragraph IV facilitated generic products, finding a corresponding cumulated consumer surplus of $177 billion. This implies that gains flowing to consumers as a result of this regulatory mechanism amount to around $92 billion or about $133 per consumer in this market. These gains come at the expense to producers who lose, approximately, $14 billion. This suggests that net short-term social gains stands at around $78 billion. We also demonstrate significant cross-molecular substitution within the market and discuss the possible appropriation of consumer rents by the insurance industry. Policy and innovation implications are also discussed. |
| JEL: | I11 I38 O3 |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17188&r=hme |
| By: | Patricia M. Danzon; Andrew W. Mulcahy; Adrian K. Towse |
| Abstract: | This paper analyzes determinants of ex-manufacturer prices for originator and generic drugs across a large sample of countries. We focus on drugs to treat HIV/AIDS, TB and malaria in middle and low income countries (MLICs), with robustness checks to other therapeutic categories and other countries. We examine effects of per capita income, income dispersion, number and type of therapeutic and generic competitors, and whether the drugs are sold to retail pharmacies vs. tendered procurement by NGOs. The cross-national income elasticity of prices is 0.4 across high and low income countries, but is only 0.15 between MLICs, implying that drugs are least affordable relative to income in the lowest income countries. Within-country income inequality contributes to relatively high prices in MLICs. Number of therapeutic and generic competitors only weakly affects prices to retail pharmacies, plausibly because uncertain quality leads to competition on brand rather than price. Tendered procurement attracts multi-national generic suppliers and significantly reduces prices for originators and generics, compared to prices to retail pharmacies. |
| JEL: | I11 L11 O14 O25 |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17174&r=hme |