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Monetary and fiscal rules are complementary. Whereas monetary policy and monetary institutions have been reformed in line with developments in modern macroeconomics, fiscal policies and institutions have not kept pace with these developments. review of Australia's existing fiscal responsibility legislation, the Charter of Budget Honesty, has pointed out significant shortcomings. This paper outlines a proposal by to reform Australia's fiscal responsibility legislation. It proposes three fiscal policy rules that are designed primarily to tie-down expectations in relation to the long-run path of the Commonwealth government's net debt. It also proposes the establishment of an independent Fiscal Commission to monitor and enforce compliance with the rules and to improve the transparency, independence and accountability of the federal budget process. The proposal aims to give politicians the commitment technology they need to address the fiscal challenges posed by an aging population and innovations in the terms of trade. [ABSTRACT FROM AUTHOR]

The goal of this paper is to revisit Paolo Mauro's influential paper on corruption and growth focusing on the strength of his results under weak identification. The instrument used in his original paper is found to be 'weak' as defined by the literature on weak instruments. Our results suggest that there is a high probability that the parameters of interest are locally almost unidentified. We also investigate other instruments commonly used in the corruption literature and obtain similar results. After identifying an instrument with sufficient strength, we fail to reject a zero effect of corruption on investment and economic growth. ( JEL C31, D73) [ABSTRACT FROM AUTHOR]

Almost 20 years ago, an article in Economic Papers by Altman and Daly asked 'Do fluctuations in the macroeconomy influence Aboriginal employment status?' This paper revisits this question in view of recent evidence. Indigenous people are more likely than before to be employed in industries similar to that of other Australians, and hence are less insulated from the business cycle. The greater engagement in the Australian economy is not something to be feared as it means that Indigenous employment will eventually respond to sustained macroeconomic growth. Indeed, Indigenous employment in the private sector converged rather quickly to the Australian average over the ten years of buoyant economic conditions between 1996 and 2006. Economic slow-downs do circumscribe the ability to improve Indigenous employment outcomes, but this simply means that educational and training investments become even more important in ensuring that Indigenous people are in a competitive position once economic growth picks up again. [ABSTRACT FROM AUTHOR]

The central component of most economic models that analyse the transition from the Malthusian regime to self-sustaining developed economies is education. Improved health is normally envisaged as simply a by-product of economic growth. Whereas growth does, indeed, tend to improve health status, the reverse is also true, namely that health improvements are a dynamic force capable of driving economic expansion. This paper underlines the importance of health improvements in escaping from Malthusian stagnation. Further, and in contrast to existing literature, which emphasizes the effects of changes in mortality rates, this paper focuses on the relationship between health status and the efficiency of human capital technology. Through this channel, health improvements stimulate investments in child quality in terms of both nourishing and schooling and drive the economy towards the Modern Growth regime. [ABSTRACT FROM AUTHOR]

The role of corporations in allocating resources has been of great importance in the debate about the manner in which enterprises should be governed to enhance economic growth. Corporate governance features seem to be central to the dynamics by which successful firms and economies improve their performance over time as well as relative to each other. In this paper we try to clarify the relationship between corporate ownership structure and output growth by using the data of La Porta et al. (J. Finance 1999; LIV: 471–517) on ownership structure of large- and medium-sized corporations in 27 economies. To search for empirical linkages, we use cross-country growth regressions. The evidence provided in the paper suggests that an environment with a higher percentage of directly and indirectly widely held companies and a lower degree of state than private ownership is associated with a higher growth rate of per capita income. We also conclude that a higher degree of institutional investment does not seem to enhance the growth performance of an economy. Copyright © 2008 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Dungey and Pagan (2000) present a SVAR model of the Australian economy which models macroeconomic outcomes as transitory deviations from a deterministic trend. In this paper we extend that model in two directions. First, we relate it to an emerging literature on Dynamic Stochastic General Equilibrium modelling of small open economies. Second, we allow for both transitory and permanent components in the series and show how this modification has an impact on the design of macroeconomic models. [ABSTRACT FROM AUTHOR]

This paper is consisted of four parts. The first part argues that e-commerce and e-commercial affairs are two different concepts. The second part discusses the property of commodity; that is, a commodity is characterized by six important characteristics including material, flow, owner, region, time and information. The third part puts forward a theory on commodity material flows (MFs) in which the concept of ‘six essential commodities for production and living’ is proposed. It is the first time that the movement rules of ‘six essential commodities for production and living’ and ‘input-production-circulation-consumption’ in the social economic development process was proposed. Commodity physical flow, commodity capital flow and commodity information flow are considered as the three different states of commodity MFs, and they must follow the rule of the entire commodity movement. The theory of commodity MF includes commodity physical flow theory, commodity capital flow theory and commodity information flow theory. The core is commodity physical flow theory. The fourth part further discuses three flows, i.e. commodity physical flow, capital flow and information flow, indicating that three flows are contradictory but complementary, suggesting the systems thinking of ‘three flows integration’, ‘three flows combination’ and ‘three flows incorporation’. Copyright © 2009 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Based on material flow (MF) theory, this paper proposes two kinds of relationships between MF and economic development in an economic–MF system. First, the relationship between MF input and economic output, weighed by the two indexes ‘MF economic efficiency (MF economic effect coefficient)’ and ‘MF input coefficient (MF consumption coefficient)’; and second, the relationship between MF input increment rate and economic output increment rate, weighed by the index ‘MF input elasticity coefficient’. Using a mathematical interpretation among the above three indexes, the authors propose the developing and changing patterns of the three indexes with demonstration analysis. Copyright © 2009 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

This paper investigates the impact of government expenditure on growth, in a heterogeneous panel, for a sample of developing countries. Using generalized method of moments techniques, we show that countries with substantial government current expenditure have strong growth effects, which vary considerably across the nations. [ABSTRACT FROM AUTHOR]

This paper introduces a new comprehensive panel of annual state-level income inequality measures spanning the postwar period 1945–2004. For many states, the share of income held by the top decile experienced a prolonged period of stability after World War II, followed by a substantial increase in inequality during the 1980s and 1990s. This paper also presents an examination of the long-run relationship between income inequality and economic growth. Our findings indicate that the long-run relationship between inequality and growth is positive in nature and driven principally by the concentration of income in the upper end of the income distribution. ( JEL D31, O40) [ABSTRACT FROM AUTHOR]

This paper takes a fresh look at Africa's growth experience by using the Bayesian model averaging (BMA) methodology. BMA enables us to consider a large number of potential explanatory variables and sort out which of these variable can effectively explain Africa's growth experience. Posterior coefficient estimates reveal that key engines of growth in Africa are substantially different from those in the rest of the world. More precisely, it is shown that mining, primary exports and initial primary education exerted differential effect on African growth. These results are examined in relation to the existing literature. Copyright © 2008 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

In this paper I analyse the role of openness and globalisation in Latin America's economic development. The paper is divided into two distinct parts: I first ( Sections 2 to 4 ) provide an analysis of 60 years of the region's economic history, that go from the launching of the Alliance for Progress by the Kennedy administration in 1961, to the formulation and implementation of the market oriented reforms of the Washington Consensus in the 1990s and 2000s. I conclude that Latin America's history has been characterised by low growth, high inflation and recurrent external crises. In Section 5 I deal formally with the costs of crises and I estimate a number of variance component models of the dynamics of growth. I find that external crises have been more costly in Latin America than in the rest of the world. I also find that the cost of external crises has been inversely related to the degree of openness. [ABSTRACT FROM AUTHOR]

With firms increasingly relying on ubiquitous computing to implement major business initiatives, it is becoming ever more necessary to understand the technological aspects of business developments. This paper analyzes the use of remote diagnostics systems in the manufacturing industry and discusses the opportunities and challenges for the early adopters. It pays specific attention to the impact on business aspects such as the value creation process consisting of relationships, roles, and architecture and the value proposal consisting of a business offer and customer value. The study shows how ubiquitous computing allows manufacturers to become remote service providers while customers can either become co-creators of value or passive receivers of created value. Ubiquitous computing also creates possibilities for the manufacturing industry to design new kinds of business offers based on remote presence. Studying remote diagnostics systems shows that ubiquitous computing creates value when deployed in products, and not just in relation to individuals. Moreover, the design of the value-creation process should not be limited to the single supplier or customer organization, as ubiquitous computing applications take no notice of organizational boundaries. [ABSTRACT FROM AUTHOR]

Three dilemmas of corporate social responsibility (CSR) are described in relation to a proposed triadic critical systems framework based on boundary critique. First, the holistic dilemma of addressing triple bottom line interests in economic, social and environmental issues. This speaks to a ‘framework for understanding’ in making sense of interrelationships between entities in a complex reality (‘getting real’). Second, the dilemma of nurturing cooperation amongst stakeholders having diverse viewpoints. This speaks to a ‘framework for practice’ in fostering engagement between multiple perspectives based on different boundaries (‘getting it right’). A third dilemma of CSR is presented in terms of ‘getting a grip’—a concern that speaks to a ‘framework for responsibility’ in addressing the moral dilemma that any methodology, approach, system or framework can neither be entirely holistic nor appropriately conversant with all perspectives. With this caveat in mind, the paper examines one particularly significant systems tool for addressing CSR dilemmas—critical systems heuristics (CSH). Applying the triadic framework, the potential value of CSH for CSR is surfaced from two contrasting perspectives—the CSR advocate and the CSR adversary. Copyright © 2008 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Economic disparities between the regions of the European Union are of constant concern both for policy and economic research. In this paper, we examine whether there are overlapping trends of regional development in the EU: overall convergence, on the one hand, and persistent or even increasing spatial concentration (agglomeration), on the other. Kernel density estimation, Markov chain analysis and cross-sectional regressions provide evidence that convergence of regional per-capita income in the EU15 has become considerably stronger in the 1990s. The reduction of income disparities, however, is a phenomenon between nations but not between regions within the EU countries. European integration (and possibly European regional policy) fosters the catching-up of lagging countries but at the same time forces towards agglomeration of economic activities tend to increase disparities within the EU member states. Resumen. Las disparidades económicas entre regiones de la Unión Europea son una preocupación constante para la investigación relacionada con políticas y con economía. En este artículo examinamos si existen tendencias superpuestas de desarrollo regional en la UE: convergencia en términos generales, por un lado, y por otro una concentración espacial (aglomeración) continua o incluso en aumento. La estimación por núcleos ( kernel) de la función de densidad, el análisis mediante cadenas de Markov y las regresiones transversales aportan pruebas de que la convergencia de ingresos regionales per cápita de la UE15 se ha fortalecido considerablemente en la década de los noventa. La reducción en la disparidad de ingresos, sin embargo, es un fenómeno entre naciones pero no entre regiones dentro de países de la UE. La integración europea (y quizá la política regional europea) fomenta la puesta al día de los países rezagados pero al mismo tiempo las fuerzas conducentes a la aglomeración de actividades económicas tienden a aumentar las disparidades dentro de los estados miembros de la UE. [ABSTRACT FROM AUTHOR]

Nothwithstanding crisis and critique, development remains an enduring frame within which much social and economic transformation is interpreted and envisaged. In the context of arguments about the need for a nuanced spatial vantage point on development, this paper asks what this means in the context of new conjunctures and constellations? It focuses on intensified processes and patterns of uneven development manifest as enclaves. The paper explores these drawing on literatures about Southeast Asia, sub-Saharan Africa and the Gulf. [ABSTRACT FROM AUTHOR]

Whereas initially physical capital and later, knowledge capital were viewed as crucial for growth, more recently a very different factor, entrepreneurship capital, has emerged as a driving force of economic growth. In this paper, we define a region's capacity to create new firms start-ups as the region's entrepreneurship capital. We then investigate the local embeddedness of this variable and which variables have an impact on this variable. Using data for Germany, we find that knowledge-based entrepreneurship capital is driven by local levels of knowledge creation and the acceptance of new ideas, indicating that local knowledge flows play an important role. Low-tech entrepreneurship capital is rather increased by regional unemployment and driven by direct incentives such as subsidies. All three measures are locally clustered, indicating that indeed, entrepreneurship capital is a phenomenon that is driven by local culture, and is therefore locally bounded. Mientras que inicialmente el capital físico, y posteriormente el capital conocimiento, fue considerado crucial para el crecimiento, más recientemente un factor muy diferente, el capital empresarial de espíritu emprendedor ( entrepreneurship capital), ha surgido como una fuerza impulsora de crecimiento económico. En este artículo, definimos como capital empresarial emprendedor la capacidad de una región para originar la puesta en marcha de nuevas empresas. A continuación investigamos el arraigo local de esta variable y las variables que tienen un impacto sobre esta variable. Usando datos de Alemania, hallamos que el capital empresarial emprendedor basado en el conocimiento está motivado por niveles locales de creación de conocimiento y la aceptación de nuevas ideas, indicando que los flujos de conocimiento local juegan un papel importante. El capital empresarial emprendedor basado en bajas tecnologías aumenta con el desempleo regional y está motivado por incentivos directos como subsidios. Las tres variables están agrupadas localmente ( locally clustered), indicando que sin duda el capital empresarial emprendedor es un fenómeno motivado por la cultura local, y por tanto atribuible a una localidad. [ABSTRACT FROM AUTHOR]

Whether or not it pays to be green or under what circumstances is an important ongoing debate among economic researchers. However, this question, with its rather instrumental rationality, may underestimate another key issue: the ability of companies to create value that can be captured from customers. This paper reports on three companies in the automotive industry developing and launching cars with improved eco-environmental performance and less petrol consumption. The study reveals that, despite being captured in the same technological paradigm, the individual company's mode of environmental interpretation and its aspiration to exploit new technology may be two important explanatory factors in its ability to go green profitably. The study indicates that an enacting mode of environmental interpretation may be superior to a discovering mode, and suggests that for companies having a discovering mode there may be a need to complement existing engineering practice with insights into consumer psychology, and bundling of common good versus private good product attributes. The research upon which this paper is based was conducted using an insider/outsider approach in studying the three companies. Copyright © 2006 John Wiley & Sons, Ltd and ERP Environment. [ABSTRACT FROM AUTHOR]

The scope of the paper is limited by focusing on developing countries in the context of the world economy. We mostly consider the effects of globalization on income levels and a country's rate of economic growth. This focus is supported by studies (Ravallion; Bourguignon) that find that the level of income and expenditures across a continuum of household income categories is positively associated with economic growth, although wealthy households may benefit more than those with lower income. [ABSTRACT FROM AUTHOR]

This paper is an attempt to analyse the consequence of trade liberalization in agriculture in the developed countries on the incidence of child labour in a developing economy in terms of a three-sector general equilibrium model with informal sectors. Adult labour and child labour are substitutes for each other in the two informal sectors of the economy and are used together apart from capital in producing two exportable commodities. The interesting result that appears from the analysis is that agricultural trade liberalization in the developed countries may be effective in bringing down the incidence of child labour in the system. The paper substantiates the desirability of trade liberalization in agriculture in the developed nations from the perspective of the developing economies for reasons other than welfare improvement. [ABSTRACT FROM AUTHOR]

The work discussed in Bivand and Brunstad (2003 ) was an attempt to throw light on apparent variability in regional convergence in relation to agriculture as a sector subject to powerful political measures, in Western Europe, 1989–1999. The present study takes up a number of points made in conclusion in that paper. Since it is possible that the non-stationarity found there is related to further missing variables, including the inadequacy of the way in which agricultural subsidies are represented, we attempt to replace the agriculture variables with better estimates of producer subsidy equivalents. It is also sensible to check that agricultural support is not masking or masked by other variables, for example human capital. The article is also an account of the development of software contributed to the project ( Development Core Team, 2005 ) as packages, in particular the spdep package for spatial econometrics. New functions generously contributed by researchers will be presented and compared. We find that agricultural support does impact regional economic growth after human capital is taken into consideration, and that we can show that apparent non-stationarity is alleviated by adding these variables.We further find that the moderated remaining spatial autocorrelation can best be represented by a substantive spatial lag model. [ABSTRACT FROM AUTHOR]

The authors present the case of five Canadian peripheral regions, which they argue are destined to decline. The explanation of the reasons why future decline (in absolute population and employment numbers) is inevitable constitutes the article’s central focus. The authors suggest that regional decline will become an increasingly common occurrence in nations at the end of the demographic transition whose economic geographies display centre-periphery relationships. Such broad structural trends cannot be easily altered by public policy. The authors reflect on the implications of regional decline for the formulation of local economic development strategies. Local economic development strategies should not, they argue, be advanced as a means of arresting population and employment decline. To suggest that the regions studied in this article will decline because of a lack of social capital or insufficient number of local entrepreneurs, is not only misleading but may also be counterproductive. [ABSTRACT FROM AUTHOR]

The Gross Product of the Northern Territory accounts for approximately 1.2% of Australian GDP. The economic growth record of NT in the past few years has been well below all Australian states and territories but the per capita income of NT remains higher than the national per capita income. Due to continued interstate migration, higher birth rate among the indigenous population and the inability of NT to attract international migrants, the Territory's population mix is slowly changing. This paper shows that the NT's economic growth rate is closely linked to the growth rate of labour force and private investment. Although the overall labour force participation-rate is almost unchanged, the male and female participation rates are moving in the opposite direction. Finally, the paper presents short-term forecasts for NT's Gross State Product per person employed, private investment and employment. The forecasting exercise shows that the cyclical pattern is likely to continue in the near future. [ABSTRACT FROM AUTHOR]

This paper describes the introduction of ‘ustainability’ as a novel strategic paradigm to senior executive learning. Specifically, we describe the Sustainable Enterprise Academy, an executive education initiative founded by the Schulich School of Business at York University (Canada) with the active support of a number of academic collaborators, five corporations and several business and civil society organizations. The Academy is dedicated to business transformation through the application of a strategic sustainability paradigm, which assumes the desirability of business simultaneously creating economic, social and environmental value. The paper recounts the Academy's journey between 1999 and 2003, during which time five successful senior executive Business Leader Seminars were held – four in Canada and one in the US. Evaluation data from participants are presented and lessons learned described. The paper also explores future avenues of development for the Academy. Copyright © 2005 John Wiley & Sons, Ltd and ERP Environment. [ABSTRACT FROM AUTHOR]

Copyright of Canadian Journal of Economics is the property of Wiley-Blackwell and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Who benefits from economic growth? This paper analyses the distributional impact of different types of growth within a two-sector model. The paper first presents necessary and sufficient conditions for unambiguous changes in wage inequality in a dual economy, based on analysis of the entire Lorenz curve. These conditions are then applied to the Harris–Todaro model with an urban non-agricultural sector and rural agriculture. It is shown that capital accumulation or technical progress in agriculture can shift the Lorenz curve inwards and reduce wage inequality, while the effects of development in non-agriculture are typically ambiguous. [ABSTRACT FROM AUTHOR]

Innovative financing mechanisms are needed to facilitate sustainable development. In the past few years, socially responsible investments have emerged as a successful type of financing scheme but many eco-oriented start-up companies remain under-funded. Apparently, environmental innovations have only recently caught the attention of an important financial sector: venture capital (VC). The article describes the emerging phenomenon of environment-related VC (or green VC) and provides an overview of the current market for this type of investment. The paper delves into this industry, revealing its characteristics, processes and mechanisms. The study also uncovers the main problems faced by eco-entrepreneurs as well as venture capitalists interested in this type of venture. Finally, it analyses the drivers for green VC and attempts to identify the sources of innovation and the uniqueness of these emerging financial products. Based on the analysis, the paper also derives a definition of green VC. Copyright © 2003 John Wiley & Sons, Ltd and ERP Environment. [ABSTRACT FROM AUTHOR]

This paper reviews the foreign debt burden in Central America with special emphasis on Honduras and Nicaragua. These countries have a large debt overhang and they have lagged behind the rest of the region in terms of economic growth. Our work suggests that Honduras and Nicaragua require alleviation of their foreign debt as a prerequisite to achieve sustained economic growth. The paper also reviews the initiative aimed at reducing the debt burden of the highly indebted poor countries (the HIPC Initiative) and evaluates alternative scenarios of debt reduction for both Honduras and Nicaragua. It ends with a critical assessment of the implications of the fiscal and openness criteria established in the HIPC Initiative. [ABSTRACT FROM AUTHOR]

The problems of developing countries are well documented and they appear to be growing in magnitude. Although science and technology (S&T) offers a glimmer of hope in dealing with problems of developing countries, policy formulation and implementation have not yielded the desired results. The reasons advanced for the failure of S&T to aid in national development tend to be fragmented and are usually based on the mechanistic worldview. This tends to perpetuate mistakes in policy formulation and implementation. A systemic framework is thus advanced in this paper to enable us to understand the problems encountered in S&T policy formulation. It is hoped that the framework will enable us to start trying to solve the right problem rather than the wrong problems advanced by mechanistic thinkers. The systemic framework advances the following set of problems as critical: inappropriate norms of a nation, inappropriate worldview, and human behavioural constraints in managing complexity. These problems manifest themselves as Kenneth Boulding's (1966) pathologies of intellectual productivity—spurious saliency, unproductive emulation, and cultural lag—resulting in ineffective S&T policy. Copyright © 2000 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Increasing scarcity and pollution has called for changes in water policies, which should reflect society's preferences toward water use, development, and the environment. Water management is still limited in incorporating changing policies and in deriving directives to implement water instruments under long‐term planning. Some examples are water charges that do not reflect watershed externalities and water permits lacking future vision of allocation. Hydro‐economic modeling has explored trade‐offs of water allocation and improved water operations but still does not address instruments' integration. This paper proposes a modeling approach that identifies how to apply water management instruments integrated with each other to deliver a water allocation strategy reconciled with economic development projections and changing water use preferences. This improves our understanding on adjusting the implementation of water management instruments considering future outcomes and trade‐offs. The methodology combines discrete dynamic programming to determine increments in water permits, multiobjective linear programming to generate a Pareto set to model users' water preferences, and nonlinear programming to allocate water permits over different river reaches subject to water quality targets. The reconciliation allowed to identify sustainable water allocation strategies supported by a watershed, and instruments' integration to make it feasible. Strategies imposing limited water permits to economic users and watershed regions indicated where (and when) water conservation programs should be applied, along with quantitative targets (how much). The economic trade‐offs identified reference values for economic instruments to compensate the externalities. Finally, less strict water quality targets did not result in higher economic returns. Key Points: Water management is limited in incorporating changing policies and in deriving directives to integrate water instrumentsWater allocation depends on exogenous development drivers, economic benefits and evolving society's perception of water preferencesIssuing water permits to fulfill all economic demands may not yield the highest economic benefit, if it lacks integration with other water management instruments [ABSTRACT FROM AUTHOR]

The objective of the paper is to verify if income inequality impedes the growth rates in OECD countries in the period of 1990–2014 and to reveal whether the choice of the income inequality measure determines the sign and the strength of the estimated relationship. We use system GMM to estimate parameters of a dynamic panel growth model. The research indicates that income inequality negatively affects economic growth. We also find evidence that various measures of inequality bring the different scale of consequences for economic growth, with measures that give more weight to the middle part of the distribution being the weakest predictor of GDP growth. Simultaneously, we present the test of weak instruments, which helps to explain these differences. [ABSTRACT FROM AUTHOR]

To analyse the impact of the diversity of talent distribution on the equilibrium growth rate, this paper develops an equilibrium growth model with heterogeneous labor. We show that the growth effect after free trade depends on the diversity effect and the trade effect. In addition, we prove that if talent diversity is great enough then opening trade will stimulate economic growth. In contrast, if talent diversity is small enough then trade openness is detrimental to economic growth. [ABSTRACT FROM AUTHOR]

Copyright of Canadian Journal of Economics is the property of Wiley-Blackwell and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This paper examines the dynamic relationship between interest rates, inflation and economic growth using a long dataset for the UK. The approach adopted enables us to identify structural breaks in the dynamic system (vector autoregression (VAR)). We find interest rates respond much more strongly to growth and inflation over recent decades, and forecast error variance decomposition analysis indicates there is increasing interconnectedness between the variables in recent years. Economic policymakers need to carefully monitor the linkages between these variables and be prepared to adjust their monetary policy tools when faced with structural changes. [ABSTRACT FROM AUTHOR]

In the mainstream real business cycle (RBC) model, labor can be viewed as temporary employment since the firm's demand for labor behaves directly in response to stochastic productivity shocks in each period. This paper provides a tractable way of analyzing fluctuations in permanent and temporary employment over the business cycle, as well as the underlying driving forces. This inclusion of heterogeneity helps reconcile the RBC model with the U.S. data given that temporary employees in general only account for a small proportion of total private‐sector employment (about 2%–3%). We draw an explicit division between permanent and temporary employment and resort to this separation to account for stylized facts that characterize a two‐tier labor market. In particular, with regard to the U.S. labor market, our benchmark model can well explain the motivating facts: (1) temporary employment is much more volatile than permanent employment, (2) the share of temporary employment (the ratio of temporary to aggregate employment) exhibits strong pro‐cyclicality, (3) permanent employment lags by two quarters on average, and (4) the correlation between temporary employment and output is stronger than that involving the permanent counterpart. The quantitative analysis suggests that our proposed channels explain the main facts well and the model further provides plausible reasoning for a firm's labor hoarding. [ABSTRACT FROM AUTHOR]

Copyright of Papers in Regional Science is the property of Wiley-Blackwell and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Canadian Geographer is the property of Wiley-Blackwell and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This paper examines how knowledge created by firm experience (learning economies) and scale and scope economies affect performance in firms' development activities. The empirical results suggest that each factor has a significant effect on development performance. Moreover, knowledge that results from greater experience within a particular technological area, when combined with knowledge spillovers from greater scope in other technological areas, significantly improves development performance. The results suggest that experience shapes and facilitates firms' abilities to absorb knowledge spillovers. Our empirical findings thus provide a more nuanced examination of the drivers of performance and have implications for the management of firms' development activities. Copyright © 2006 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

How far does mobility of multinational banks solve problems of financial development? Using a panel of 80,000 loans over 7 years, I show that greater cultural and geographical distance between a foreign bank's headquarters and local branches leads it to further avoid lending to "informationally difficult" yet fundamentally sound firms requiring relational contracting. Greater distance also makes them less likely to bilaterally renegotiate, and less successful at recovering defaults. Differences in bank size, legal institutions, risk preferences, or unobserved borrower heterogeneity cannot explain these results. These distance constraints can be large enough to permanently exclude certain sectors of the economy from financing by foreign banks. [ABSTRACT FROM AUTHOR]

Copyright of Papers in Regional Science is the property of Wiley-Blackwell and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Papers in Regional Science is the property of Wiley-Blackwell and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Microeconometric evidence reveals high private returns to education, most prominently in low-income countries. However, it is disputed to what extent this translates into a macroeconomic impact. This paper projects the increase in human capital from higher education in Malawi and uses a dynamic applied general equilibrium model to estimate the resulting macroeconomic impact. This is contingent upon endogenous adjustments, in particular how labour productivity affects competitiveness and if this in-turn stimulates exports. Choice among labour market assumptions and trade elasticities results in widely different outcomes. Appraisal of such policies should consider not only the impact on human capital stocks, but also adjustments outside the labour market. [ABSTRACT FROM AUTHOR]

Recent research examining the growth impacts of institutions have found that institutions are important in fostering economic growth. By building a framework around the institutional taxonomy proposed by Rodrik (2005), our paper contributes to the literature in the following way. First, we confirm the result that 'institutions matter' and show that different types of institutions matter differently for growth. By applying a dynamic panel model, we find that market-creating and market-stabilising institutions are important in fostering economic growth. We then extend this analysis and investigate whether countries at different levels of development could respond heterogeneously to changes in their institutional structure. We find that poor countries benefit the most from market-creating institutions and institutions that support market stability. We also find some evidence that market-legitimising institutions such as 'democracy' are not necessarily optimal for growth in poor countries. These results have important implications for countries that decide on the optimal strategy to improve their institutional framework. [ABSTRACT FROM AUTHOR]

Copyright of Canadian Journal of Economics is the property of Wiley-Blackwell and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This paper considers an overlapping generations model of economic growth populated by two types of individuals. Competitive types compare future consumption (i.e. wealth) with the mean. Self-sufficient types derive utility simply from their own consumption and do not compare themselves with others. I derive a condition under which the utility (happiness) of both types increases when the economy is populated by a larger share of competitive types. I show that a sufficiently high share of competitive types in a society can be inevitable for long-run economic growth to exist. [ABSTRACT FROM AUTHOR]

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Significant investments in developing technological innovations have been made in the Australian beef industry but with low adoption rates. By modelling the key variables and their interactions in the innovation adoption process, this research seeks to demonstrate the complexity and dynamics of the process. This research uses causal loop modelling and develops a holistic model of the current innovation adoption system in the Australian beef industry to show the complexity of dynamic interactions among multiple variables. It is suggested that innovation adoption is such an extremely complex issue, and we need to shift our views on this issue from a paradigm of linear thinking to systems thinking. Innovation adoption is more likely to be enhanced based on a full understanding of the complexity and dynamics of the system as a whole. The paper demonstrates to practitioners and developers of innovation the multiple variables and interactions impacting innovation adoption. Copyright © 2014 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

This paper deals with a classic development question: how can the process of economic development-transition from stagnation in a traditional technology to industrialization and prosperity with a modern technology-be accelerated? Lewis (1954) and Rostow (1956) argue that the pace of industrialization is limited by the rate of capital formation which in turn is limited by the savings rate of workers close to subsistence. We argue that access to capital goods in the world market can be quantitatively important in speeding up the transition. We develop a parsimonious open-economy model where traditional and modern technologies coexist (a dual economy in the sense of Lewis 1954). We show that a decline in the world price of capital goods in an open economy increases the rate of capital formation and speeds up the pace of industrialization relative to a closed economy that lacks access to cheaper capital goods. In the long run, the investment rate in the open economy is twice as high as in the closed economy and the per capita income is 23% higher. ( JEL O11, F43, O14) [ABSTRACT FROM AUTHOR]

This paper studies the relationship between geographic patterns of industry and economic growth without scale effects. Facing transport costs and imperfect knowledge diffusion, firms locate production, process innovation and product development in their lowest cost regions, leading to the partial concentration of production and full agglomeration of innovation in the region with the largest market. An increase in industry concentration raises knowledge spillovers from production to innovation, causing a fall (rise) in market entry, if labour productivity improves more for process innovation (product development). The rate of economic growth rises or falls, depending on how industry concentration affects market entry. [ABSTRACT FROM AUTHOR]

The current mainstream neoclassical economic analysis of growth in a "Western" economy holds that in anything but the relatively short run, defined as the length of a business cycle, the economy reaches an equilibrium growth rate determined entirely by supply side factors and unaffected by measures taken to increase aggregate demand during a slump. In addition, the process of transformation to this long-run equilibrium position is never explained. As a result of these views, the finance sector, both domestically and internationally, has obtained undue influence and behaved in a manner that caused the crisis which started in 2007. This paper considers these propositions, focussing on neoclassical growth theory. After establishing these claims, the policy implications are discussed. [ABSTRACT FROM AUTHOR]