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Eine Reihe von Lebensmittelskandalen der jüngeren Vergangenheit hat gezeigt, dass fehlgeleitete ökonomische Anreize eine bedeutsame Risikoquelle sind. Der Normappell des Gesetzes reicht augenscheinlich nicht bei allen Lebensmittelunternehmern aus, um sie von gewinnträchtigen Verstößen gegen lebensmittelrechtliche Vorschriften abzuhalten. Vor diesem Hintergrund gibt der vorliegende Beitrag mit Blick auf die Ernährungswirtschaft einen Überblick über Regulierungsanforderungen, -möglichkeiten und -ansätze. Für eine effektive und kosteneffiziente Prävention sind smarte Regulierungsansätze erforderlich, die nicht nur dysfunktionale Effekte wie Crowding-Out und Reaktanz vermeiden, sondern in der Lage sind, intrinsische Motive und extrinsische Anreize zur Regelbefolgung gleichzeitig zu stärken (Crowding-In). Insbesondere Name-and-Shame erscheint hierfür aus verhaltensökonomischer Sicht geeignet zu sein. A series of food scandals has indicated lately that misdirected economic incentives, in conjunction with a lack of norms to abide by the law, induce non-compliance with food regulations and thus behavioural food risks. Against this background, we outline both the specific need for regulation and the available regulatory approaches in the food sector. An effective and cost-efficient prevention of rule-breaking behaviour requires smart regulation. Smart approaches to regulation not only avoid the dysfunctional effects of crowding-out and reactance but simultaneously enhance intrinsic motives and extrinsic incentives to comply (crowding-in). From a behavioural economic point of view, name-and-shame has a good chance of qualifying as "smart".

The monetary policy strategies arround the world have been envolving in the last two decades considerable. In the past, central banks’ have been associated with a „veil of mistery” having at their grounds the so-called policy mistique. Nowadays, the new monetary policy strategy – inflation targeting – promoted by many countries established new coordinates for monetary policy. In this paper we focuse upon the monetary policy committee with a special focus upon the Bank of England’s case, because of the special track of this committee in several fields: interest rates expectations, other asset prices, the communication of the central bankers, publishing the minutes of the committees.

We investigate how the link between individual schooling and political participation is affected by country characteristics. Using individual survey data, we find that political participation is more responsive to schooling in land-abundant countries and less responsive in human capital–abundant countries, even while controlling for country political institutions and cultural attitudes. We find related evidence that political participation is less responsive to schooling in countries with a higher skill premium, as well as within countries for individuals in skilled occupations. The evidence motivates a theoretical explanation in which patterns of political participation are influenced by the opportunity cost of engaging in political rather than production activities. © 2012 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Schools of Business are diverse in their approach to meeting the Association to Advance Collegiate Schools of Business (AACSB) standards for assurance of learning. Developing a comprehensive assessment plan that includes a process for managing, collecting, analyzing, and reporting student-level assessment data is a daunting task. Assuring the process is faculty driven is even more difficult. Through the creation and evolution of a relatively simple Microsoft Access database, this University was able to develop, implement and manage an assessment plan that meets the AACSB assurance of learning standards, engages the majority of faculty, facilitates the data collection process, generates real-time student-outcome data and trends curriculum improvements over time.

The North American Free Trade Agreement (NAFTA) once again became a newsworthy topic in the US media, this time during the contested Spring 2008 Democratic primary for the US presidency, particularly from campaign talking-points originating within Midwestern Rust-Belt states. Although the merits of NAFTA were central to the dialogue during this campaign season, similar debate did not warrant deliberation during the time of the general election in the Fall of 2008. An examination of media coverage dedicated to NAFTA in the lead-up to the past three American general elections confirmed these tendencies. Even though the Rust Belt, which is considered the key political toss-up region in the for the US presidency, has the most at stake concerning NAFTA’s effects, it remains to be seen if the trade pact will elicit debate from the presidential candidates during the Fall election in 2012.

Offering a critical perspective, this paper presents the new strategy in European Union’s banking supervision as response to the financial market tensions, describing the results of this redefinition process on different areas: the revision of supervision institution and international banking standards and the strengthening of corporate governance in banking. The cooperation between macro and micro prudential authorities represents a solution for sustaining the financial stability in the euro area. The paper also analyzes the newly implemented capital standards - Basel III, a way for assuring a better management of systemic risk. The efficiency and success of this reform in banking are subjects of doubts and strongly debated in the current context. and problems concerning its independence attract adverse opinions. Far from being on one side or the other, this paper gives a full description of the process, leaving its advantages and disadvantages an open subject.

The present article aims to explore the general theme of the EU enlargement strategy in the new 2012 European context. Until now, the EU’s enlargement strategy has yielded impressive results. It succeeded in transforming ten central and eastern European countries from post-communism confusion into open-market, mature and effective systems of democratic governments, and even on the economic front, they have also made astonishing progress. It is no doubt that people in the new EU countries live better then before. In this context, the EU must continue the enlargement process to help stabilize the Balkan region that lie beyond its expanded eastern border. No one can deny that major issues concerning western Balkan countries’ accession are still on the table, and they even exert a geopolitical influence of sorts. This makes it all the more important to see stability and regional co-operation there are strategically vital. An all-out effort must now be made to complete the enlargement process and ensure there is no strategic vacuum. This article provides the framework of analyses for the EU problems and the challenges for the Balkans governments as for Brussels.

This paper explores the effect of party system institutionalization on the relevance of the personal income tax in the tax composition. Based on a fiscal contractualism approach, it is argued that institutionalized political party systems increase the capacity of political actors to credibly commit to fiscal contracts agreed with wealthy taxpayers. Consequently, in countries characterized by institutionalized political party systems wealthy taxpayers accept paying a bigger share of the tax burden, as reflected in a greater relevance of progressive tax types. The analysis of panel data for more than 90 countries from 1990 to 2010 supports this hypothesis, showing that party system institutionalization has an especially significant and strong positive effect on the relevance of the personal income tax where bureaucratic capacity is low. At high levels of bureaucratic capacity the effect disappears. The findings strongly support the claim that, particularly in developing countries, where bureaucratic capacity tends to be limited, taxation is best understood as a problem of credible commitment.

Using the KOF Index of Globalization and two indices of economic freedom, the authors empirically analyze whether globalization and economic liberalization affect governments’ respect for human rights in a panel of 106 countries over the 1981–2004 period. According to their results, physical integrity rights significantly and robustly increase with globalization and economic freedom, while empowerment rights are not robustly affected. Due to the lack of consensus about the appropriate level of empowerment rights as compared to the outright rejection of any violation of physical integrity rights, the global community is presumably less effective in promoting empowerment rights.

Seit Jahren hat das dezentrale System der Hochschulzulassung in Deutschland aufgrund von Mehrfachzulassungen bis lange nach Semesterbeginn mit dem Problem unbesetzter Studienplätze zu kämpfen eines der typischen Probleme dezentraler Zuordnungsverfahren. Langwierige Nachrückverfahren verzögern die Besetzung freier Studienplätze teils um mehrere Monate, obwohl die Hochschulen auf diese Problematik bereits mit einem starken Überbuchen der Studiengänge reagiert haben. Das Dialogorientierte Serviceverfahren, dessen Manipulationsanreize, Stabilitäts- und Effizienzeigenschaften von uns betrachtet werden, soll diese Probleme zukünftig beseitigen und hat durchaus das Potential die gegenwärtige Situation entscheidend zu verbessern. Dennoch konnten Schwachstellen identifiziert werden, die ausgeräumt werden sollten.

Someone reading empirical research relating human genetics to personal outcomes must be careful to distinguish two types of work: An old literature on heritability attempts to decompose cross-sectional variation in observed outcomes into unobservable genetic and environmental components. A new literature measures specific genes and uses them as observed covariates when predicting outcomes. I will discuss these two types of work in terms of how they may inform social policy. I will argue that research on heritability is fundamentally uninformative for policy analysis, but make a cautious argument that research using genes as covariates is potentially informative.

We study the agenda-setting political behavior of a large sample of U.S. newspapers during the 1996–2005 period. Our purpose is to examine the intensity of coverage of economic issues as a function of the underlying economic conditions and the political affiliation of the incumbent president, focusing on unemployment, inflation, the federal budget and the trade deficit. We investigate whether there is any significant correlation between the endorsement policy of newspapers, and the differential coverage of bad/good economic news as a function of the president's political affiliation. We find evidence that newspapers with pro-Democratic endorsement pattern systematically give more coverage to high unemployment when the incumbent president is a Republican than when the president is Democratic, compared to newspapers with pro-Republican endorsement pattern. This result is robust to controlling for the partisanship of readers. We find similar but less robust results for the trade deficit. We also find some evidence that newspapers cater to the partisan tastes of readers in the coverage of the budget deficit. We find no evidence of a partisan bias – or at least of a bias that is correlated with the endorsement or reader partisanship – for stories on inflation., info:eu-repo/semantics/published

Theory provides many explanations about the influence of electoral rules on politicians’ equilibrium behavior. With a few exceptions, all models agree that majoritarian elections are associated with more targeted redistribution and lower politicians’ rents than proportional representation. To sidestep the identification problems of previous empirical studies based on country-level data, we test these hypotheses using micro data for the mixed-member Italian House of Representatives. In particular, we address the nonrandom selection into different electoral systems by exploiting a particular feature of the Italian two-tier elections from 1994 to 2006: candidates could run for both the majoritarian and the proportional tier, but if they won in both tiers they had to accept the majoritarian seat. Focusing on elections decided by a narrow margin allows us to generate quasi-experimental estimates of the impact of the electoral rule. The main results confirm theoretical predictions, as majoritarian representatives put forward a higher proportion of bills targeted at local areas and show lower absenteeism rates than their proportional colleagues.

The process of globalization has an important impact on national tax policies. Most of the literature does not focus directly on the political decision making process and assumes that the desired tax policy is responding to objective underlying tradeoffs. Based on an original survey of members of German national parliament (Bundestag) in 2006/7 we document a strong ideological bias among policy makers with respect to the perceived mobility of international tax bases (real capital and paper profits). Ideology via party affiliation influences also directly and indirectly the perceived national autonomy in tax setting and preferences for a EU minimum tax for companies. There seems little consensus as to what the efficiency costs of capital taxation in open economies are, even though our survey falls in a period of extensive debate about and actual adoption of a company tax reform bill in Germany. From a comparative politics perspective our results document the strong role of party discipline in a parliamentary democracy as the actual voting behaviour within a party is much more cohesive than the survey evidence suggests.

Politikberatung durch externe Experten kann den politischen Prozess bereichern, sowie politischen Entscheidungen zusätzliche Glaubwürdigkeit und Akzeptanz verleihen. Zudem können externe Berater Expertisen und Informationen in politische Willensbildungsprozesse einfließen lassen, die alternativ nur zu hohen Kosten verfügbar sind. So lehrt es zumindest die Theorie. Aber kann dieser theoretische Ansatz auch in der Praxis überzeugen? Dieser Beitrag versucht eine Antwort zu geben. Am Beispiel der Reform des EU-Finanzbinnenmarktes wird gezeigt, welche Auswirkungen externe Berater auf politische Entscheidungsprozesse haben. Dabei gehen wir speziell auf die Arbeit des, mit der Reform des EU-Finanzbinnenmarktes betrauten, Lamfalussy-Ausschusses ein. Wir erläutern, welchen Einfluss der Ausschuss auf die politischen Entscheidungen hatte und welche Vorschläge letztendlich umgesetzt wurden. Zudem erörtern wir die Faktoren, welche die Effektivität externer Experten bei ihrer Beratungstätigkeit beeinflussen. Fünf Thesen fassen unsere Befunde zusammen. Die Grenzen der Politikberatung sind klar: Sie kann Impulse geben, Argumente liefern, Positionen unterstützen. Am Ende zählt jedoch das Urteil der politischen Entscheidungsträger. So auch in der EU-Finanzmarktpolitik.

This paper discusses the brief history of market (price) regulation of electricity and gas. The fight against monopolies has a history of more than 100 years in the USA. In this article, I focus on price regulation, which represents a narrower section of regulation. In the paper I discuss the phases of this regulation: Appearance of anti-monopoly combat; New Deal and the welfare state (and the concept of welfare state in Hungary in the nineties); Liberalisation; Bargaining and agreement. The old definition of regulation is modified in the following way: regulation democratically controls the prices, sales, and production of companies, and influences these in order to achieve certain social objectives.

We examine the second-best family policy under the assumption that both the number and the future earning capacities of the children born to a couple are random variables with probability distributions conditional on unobservable parental actions. Potential parents take their decisions without taking into account the effects of these actions on the government's future tax revenue. The second-best policy provides parents with credit and insurance, and allows them to appropriate the external benefits of their actions. (JEL Codes: D13, D78, D82, H31, J13) Copyright The Author 2011. Published by Oxford University Press on behalf of Ifo Institute for Economic Research, Munich. All rights reserved. For permissions, please email: journals.permissions@oup.com, Oxford University Press.

The main goal of this paper is to empirically test the function of European merger control in light of the 2004 regulatory reform, which was expected to introduce a more efficient regulatory framework for the assessment of mergers within the EU. We use stock market data to identify cases where there are discrepancies between the European Commission’s decisions compared to market evaluations of the mergers in question. Using the PROBIT model, these cases are further investigated to discover the sources of these discrepancies. In line with previous studies, our results suggest that the discrepancies are caused by procedural and institutional factors. Nevertheless, the regulatory reform introduced in 2004 has, to some extent, enhanced the efficiency of European merger control in the sense that the Commission’s assessments of mergers under the new regulation are more consistent with the market evaluations. We found that the probability of an anti-competitive deal being cleared decreases significantly under the new regulatory framework. Nevertheless, the occurrence of unnecessary remedies has not decreased as the result of the new merger control system. To the authors’ best knowledge, this paper is the first study using stock market data to evaluate the recent reform of European merger control.

We show that political institutions affect corruption levels. We use audit reports in Brazil to construct new measures of political corruption in local governments and test whether electoral accountability affects the corruption practices of incumbent politicians. We find significantly less corruption in municipalities where mayors can get reelected. Mayors with reelection incentives misappropriate 27 percent fewer resources than mayors without reelection incentives. These effects are more pronounced among municipalities with less access to information and where the likelihood of judicial punishment is lower. Overall our findings suggest that electoral rules that enhance political accountability play a crucial role in constraining politician's corrupt behavior. (JEL D72, K42, O17)

In this paper, an approach for recognizing and defining correct and operable performance will be presented with the purpose of evaluating the effectiveness and efficiency of processes in dry ports (inland intermodal hubs). The challenge in evaluating the possible improvements of the underlying processes lies in the special nature and the complex structure of dry ports. It is important to consider that all the processes are highly interconnected and that changes in parameters in one process also have an impact on parameters in other processes. Furthermore, the performance of dry ports, seen as the backbone of the system, has a significant impact on the overall performance of the whole transportation network.

There is a worldwide contemporary debate about the role of the hidden economy in achieving the goal of sustained and inclusive economic growth and development, especially in the context of its spillover effects on the formal economy. For this purpose, policy makers and academicians have made concerted efforts to estimate the size of the hidden economy and to analyze its causes, issues and implications on key macroeconomic variables. However, there is a consensus among the policy makers that a better macroeconomic policy formulation and its true implementation are subject to the proper management of the associated issues of the hidden economy with suitable policy measures. In Pakistan, it is generally assumed that the hidden economy contributes about 30% to 50% to the overall GDP. The purpose of this paper is to estimate more precisely the size of the hidden economy with the determination of its potential causes and implications. Five statistical and structural modeling approaches namely; simple monetary approach, modified monetary approach using dynamic ordinary least square (DOLS), multiple-indicators multiple-causes (MIMIC) approach, electricity consumption approach and labor market survey based approach are used to estimate the size of the hidden economy and to analyze the characteristic nature of its growth over the period. The study also investigates the potential determinants of the hidden economy and various interrelated socio-economic issues in perspective of achieving national goal of inclusive growth and development. Finally, policy implications are provided consistent with pervading facts of the hidden economy in Pakistan especially in the context of the 18th Amendment and the 7th NFC Award.

L’objet de cette note exploratoire est de rechercher les determinants de la repartition spatiale du plan de relance francais par l’investissement public. A partir de l’analyse econometrique de la repartition departementale des projets finances, il est montre l’absence d’influence politique sur cette repartition, traduisant l’inexistence de favoritisme territorial politique (pork-barrel). Il est egalement montre que les conditions economiques des departements affectent de maniere incoherente les choix de localisation : ce sont a la fois les departements les plus pauvres et ceux les moins frappes par la degradation de la conjoncture qui sont le mieux dotes. En revanche, le niveau d’investissement des conseils generaux influence positivement la presence de projet, ce qui confirmerait les problemes d’information et de mise en œuvre de la decision publique pour le gouvernement central, qui suivrait des lors les decisions publiques locales en matiere d’investissement public.

Mechanisms that rely on course bidding are widely used at Business Schools in order to allocate seats at oversubscribed courses. Bids play two key roles under these mechanisms: Bids are used to infer student preferences and bids are used to determine who have bigger claims on course seats. We show that these two roles may easily conflict and preferences induced from bids may significantly differ from the true preferences. Therefore while these mechanisms are promoted as market mechanisms, they do not necessarily yield market outcomes. The two conflicting roles of bids is a potential source of efficiency loss part of which can be avoided simply by asking students to state their preferences in addition to bidding and thus "separating" the two roles of the bids. While there may be multiple market outcomes under this proposal, there is a market outcome which Pareto dominates any other market outcome.

This paper investigates the effect of applying gender quotas on policy decisions. I first examine the effect of gender quotas on the representation of female legislators, study the correlation between gender quotas and different types of government expenditures, and then use quotas as an instrument for the proportion of female legislators to investigate the effect of female legislators on policy outcomes. The results show that an increase in the share of female legislators by one percentage point increases the ratio of government expenditure on health and social welfare to GDP by 0.18 and 0.67 percentage points, respectively. The robustness check supports that the effect of quotas on female legislators is likely to be translated into the influence of female policymakers on social welfare.

This paper analyzes the Romanian absorption capacity of the funds allocated through the REGIO programme, which is part of ERDF programme. Within the paper are presented the concept of absorption capacity and several opinions regarding its main composing elements. Also the Regio programme, its main axis and its budget is briefly presented. In the last chapter of the analysis a thorough analysis of the implementation of REGIO in the Romanian North-West Region was carried out and several causes for the low absorption of European Founds have been identified.. The process of improving the absorption capacity of European Funds is still at the beginning in Romania and will certainly become an important issue over the following years at all levels of the Romanian society and at the level of the European Funding Authorities as well.

This paper introduces a mechanism design approach that allows dealing with the multiple equilibrium problem, using mechanisms that are robust to bounded rationality. This approach is a tool for constructing supermodular mechanisms, i.e. mechanisms that induce games with strategic complementarities. In quasilinear environments, I prove that if a social choice function can be implemented by a mechanism that generates bounded strategic substitutes - as opposed to strategic complementarities - then this mechanism can be converted into a supermodular mechanism that implements the social choice function. If the social choice function also satisfies some efficiency criterion, then it admits a supermodular mechanism that balances the budget. Building on these results, I address the multiple equilibrium problem. I provide sufficient conditions for a social choice function to be implementable with a supermodular mechanism whose equilibria are contained in the smallest interval among all supermodular mechanisms. This is followed by conditions for supermodular implementability in unique equilibrium. Finally, I provide a revelation principle for supermodular implementation in environments with general preferences.

Este artículo describe una aproximación al proceso de formación de los costos políticoeconómicos que se generan para el Área Metropolitana del Valle de Aburrá y para la comunidad regulada, a causa de la reglamentación de la tasa retributiva por el uso del agua, en el proceso de negociación de la meta global de reducción de la carga contaminante del quinquenio 2006- 2011. Mediante un análisis exploratorio, el escenario se estudió desde una perspectiva inductiva que permitió apreciar la experiencia real de la implementación de una política ambiental en una región determinada. Se encuentra que los costos dan cuenta de la racionalidad del oferente y del alcance de los demandantes en el objetivo de descontaminar el río Medellín. This study describes a framework for analyzing the formation of political and economic costs in setting pollution taxes aimed to control the contamination of water bodies, in 2006-2011, for the Área Metropolitana del Valle de Aburrá and its regulated community. Through an exploratory analysis and using an inductive approach, this study examines the actual experience of implementing an environmental policy in a specific region. The results of this study suggest that political and economic costs explain not only the supplier's logic and reasoning but also the consumer's level of demands intended to reduce contamination in the Medellín River. Cet article présente le processus de formation des coûts politiques et économiques entraînés par la réglementation du taux de compensation dans l'utilisation de l'eau. Ces couts ont été assumés par la Collectivité de la Région Métropolitaine de la Ville de Medellín (Área Metropolitana del Valle de Aburrá) et par la communauté en générale lors du processus de négociation concernant l'objectif global de réduction des décharges dans la période 2006-2011. Cette étude utilise une perspective inductive qui rend compte des effets de la mise en pratique d'une politique environnementale dans une région déterminée. Les résultats de cette étude montrent que les couts reflètent à la fois la rationalité de l'offrant et la portée des demandeurs dans l'objectif commun de réduire la pollution du fleuve Medellín.

Shadow economic activities constitute a large and growing part of all economic activity throughout the world. Because all individuals engaged in these activities wish not to be identified it is very difficult to get accurate information about the relationship between corruption and shadow economy activities. The paper highlights the interaction between the underground economy and corruption using comparative analysis. It discusses the theoretical approach to shadow economic activities and focuses on the determinants of the Romanian economy concluding that Romania record a high incidence of corruption and a large shadow economy.

This study is about the interactions between GDI and government under political pressure, in a context with an agency relationship and the existence of relevant information. In particular, interactions are studied when the agency relationship is with symmetric information and it is build a research model of the GDI-government interactions in a context with an agency relationship and asymmetric information, where groups can operate in a competitive or cooperative manner. The model highlights that government expectations of utility are higher when the GDI works together, and the benefit when the GDI makes pressure in an independent way is limited to the reserve. Cooperation establishes a type of relations based on credibility that benefit to the government and the GIDI, and this will help to strengthen those links

There is much interest among cultural economists in assessing the effects of heritage preservation policies. There has been less interest in modeling the policy choices made in historic and cultural landmark preservation. This article builds an economic model of a landmark designation that highlights the tensions between the interests of owners of cultural amenities and the interests of the neighboring community. We perform empirical tests by estimating a discrete choice model for landmark preservation using data from Chicago, combining the Chicago Historical Resources Survey of over 17,000 historic structures with property sales, Census, and other geographic data. The data allow us to explain why some properties were designated landmarks (or landmark districts) and others were not. The results identify the influence of property characteristics, local socio-economic factors, and measures of historic and cultural quality. The results emphasize the political economy of implementing preservation policies.

Major reforms of the unemployment benefit system were implemented in Germany in 2005. One controversial element of these reforms is the activation of means-tested benefit recipients by a workfare programme, so-called One-Euro-Jobs. Politically and numerically, One-Euro-Jobs are the most important programme for means-tested benefit recipients with more than 600,000 benefit recipients entering the programme per year. Using a sample from early 2005, this study investigates the selection of means-tested unemployment benefit recipients into One-Euro-Jobs in their introduction period. In particular, the different participation chances for men and women as well as for eastern and western Germans are analysed. While women have a lower probability of participating if they have a child under the age of three, there is no such difference to be found for men. We also find that young adults under 25 are more likely to begin a One-Euro-Job than other age groups. Moreover, special target groups such as individuals with a migration background are not promoted with One-Euro-Jobs. In fact, a concentration on defined target groups cannot be observed. To analyse the sizable differences in the participation probabilities of women in eastern and western Germany a Blinder-Oaxaca decomposition of effects is applied. It emerges that the differences can be traced back to a large extent to characteristics such as qualification level and employment history and to the availability of child care facilities.

Recently, several school districts in the US have adopted or consider adopting the Student-Optimal Stable mechanism or the Top Trading Cycles mechanism to assign children to public schools. There is evidence that for school districts that employ (variants of) the so-called Boston mechanism the transition would lead to efficiency gains. The first two mechanisms are strategy-proof, but in practice student assignment procedures typically impede a student to submit a preference list that contains all his acceptable schools. We study the preference revelation game where students can only declare up to a fixed number of schools to be acceptable. We focus on the stability and efficiency of the Nash equilibrium outcomes. Our main results identify rather stringent necessary and sufficient conditions on the priorities to guarantee stability or efficiency of either of the two mechanisms. This stands in sharp contrast with the Boston mechanism which has been abandoned in many US school districts but nevertheless yields stable Nash equilibrium outcomes.

This paper develops a model of political contributions in which a politician can either sell policy favors, or sell access. Access allows interest groups to share hard information with the politician in support of their preferred policy. Here selling access maximizes policy utility, while selling policy favors maximizes total contributions. Imposing a binding contribution limit makes it more likely that the politician sells access, which can improve expected constituent welfare. However, a contribution limit distorts the signals associated with the contributions, which tends to result in worse policy. Alternatively, a tax on political contributions can ensure that the politician sells access without distorting his information. Therefore, from the viewpoint of a representative constituent, a tax on contributions is strictly preferred to a contribution limit or no reform. The politician, however, may prefer regulation in the form of a contribution limit, even when a tax is better for the constituent.

Die Repräsentation von Verbraucherinteressen in Deutschland weist eine unzureichende Beteiligung der Verbraucher auf. Gleichzeitig wird die Informationsfunktion von Repräsentanten im politischen Entscheidungsprozess zu wenig genutzt. Die daraus resultierenden Legitimationsprobleme der Interessenvertretung sowie mögliche Fehlschlüsse bei der Determinierung des verbraucherpolitischen Schutzniveaus werden anhand aktueller Fallbeispiele aufgezeigt. Repräsentation erfordert die Kenntnis der Interessen der Verbraucher. Angesichts der Heterogenität der Interessen ist zur Konkretisierung eines Entscheidungsrahmens, der über einen normativen Grundkonsens der Verbraucherinteressen hinausgeht, in der Praxis eine direkte lösungsorientierte Präferenzermittlung erforderlich. Dazu sollten insbesondere auch die Möglichkeiten neuer Kommunikations- und Partizipationsprozesse genutzt werden. Es sollten aber ebenso Anreize zur Informationserhebung und -bereitstellung für verbrauchernahe Institutionen geschaffen werden. Dieser Maßnahmenmix würde eine legitimiertere Repräsentation der Interessen und eine differenzierte bedarfsgerechte Instrumentgestaltung des Verbraucherschutzes erlauben. The representation of consumer interests in Germany shows an insufficient consumer participation. Coincidentally, the political decision making process profits too little from the informative function of consumer interest groups. This article will demonstrate on the basis of current case studies the consequences both for the legitimisation of interest representation and possible false conclusions on the level of consumer protection. Consumer representation requires the knowledge of consumer interests. Taking an increased heterogeneity of the preferences into consideration, it is particularly important to carry out a target-orientated preference identification to deduce a frame for political decisions beyond a normative fundamental consensus. In doing so, the possibilities of new communication instruments should be considered. One should also create incentives to collect and to provide information on the level of institutions close to consumers. This mix of actions would allow for a more legitimate representation of consumer interests and also a differentiated composition of consumer protection instruments.

This paper studies whether the degree of women’s representation in Swedish local councils affects local public expenditure patterns. Theoretically, the individual preferences of elected representatives may have an impact on public expenditure if full policy commitment is not feasible. To empirically address the question, I first analyze the preferences expressed by elected local council representatives using survey data. This permits me to make precise predictions about the effects of women’s representation on spending. The subsequent panel study on the composition of public spending in Swedish municipalities supports the predictions derived from the survey.

A jury must provide a ranking of contestants (students applying for scholarships or Ph.D. programs, gymnasts in a competition, etc.). There exists a true ranking which is common knowledge among the jurors, but is not verifiable. The socially optimal rule is that the contestants be ranked according to the true ranking. The jurors are partial and, for example, may have friends (contestants that they would like to benefit) and enemies (contestants that they would like to prejudice). We study necessary and sufficient conditions on the jury under which the socially optimal rule is implementable. These conditions incorporate strong informational requirements, particularly with respect to mechanism designer.

Die Rentenwertentwicklung der letzten Jahre wurde geprägt durch eine Reihe von diskretionären Eingriffen in die Anpassungsformel zur Berechnung des aktuellen Rentenwerts. Ziel dieses Beitrags ist es, den Einfluss dieser Maßnahmen zu quantifizieren und zu beurteilen. In einer Ex-Post-Betrachtung werden dazu auf unterschiedlichen Anpassungsformeln beruhende (hypothetische) Rentenwerte berechnet und einander gegenüber gestellt. Ein Hauptaugenmerk der Untersuchung liegt dabei auf der Frage, welche Bedeutung die einzelnen Komponenten des im Jahre 2004 verabschiedeten Rentenversicherungs-Nachhaltigkeitsgesetzes hatten und ob bzw. wie sich durch die komplexen Wirkungszusammenhänge der einzelnen Komponenten Unterschiede zwischen der Rentenwertentwicklung in Ost- und Westdeutschland erkennen und erklären lassen.

The analysis in this paper helps understand the progress in reforms and development of the private sector in the Middle East and North Africa. It shows the critical role played by the State-private sector relations in determining the progress of reforms and their impact on private sector development. The authoritarian nature of the political regimes and the existence of large oil and other rents, and conflict to a much lesser extent, have been the major factors which shaped the nature, extent and speed of reforms. JEL Classification: D78, N45, O43, O53.

With supply chains continuing to get more complex, companies struggle on a day to day basis when making critically important decisions about how to positively influence the future performance of their businesses. In particular, attempting to figure out what products to make, when to make them, how much to keep in stock and where to stock them, leave Supply Chain practitioners with the constant dilemma of balancing the risk of running short of stock and therefore impacting Sales, while on the other hand trying to prevent having too much capital tied up in inventory, with the risk of write-offs and obsolescence. Sales & Operations Planning (S&OP) has proven to be a popular and effective process for bringing control and a level of predictability to the product planning challenges of many companies. With the multi-site and global nature of Multi- Nationals, a process that attempts to have all the critical functions operating off the same plan is particularly valuable and is reflected by the greater deplyment of S&OP processes in this sector. With the key to planning being about anticipating the future, any good S&OP process will focus on enabling timely and effective decisions to be made, when faced with a number of potential scenarios. This paper proposes a practical Closed Loop System to enhance the performance of S&OP processes. The System uses an ex-ante (predictive) view of the critical business Key Performance Indicator (KPI) of Revenue as the catalyst to ensure that decisions that need to be made are surfaced in a timely fashion. With a complete system in place, covering process, tools and behaviours, senior managers have the opportunity to make decisions, while understanding the full potential impact across the business.

This article analyzes the allocation of the government budget to civilian and military expenditure by two rival countries that are involved in an arms race. We compare the consequences of myopic (period by period) planning versus rational (long-term) planning and show that although myopic planning is always favorable for both countries, they are likely to become locked in a prisoners' dilemma equilibrium in which they plan rationally. The prisoners' dilemma equilibrium results in higher stocks of weapon systems and lower welfare for both countries. We also find some evidence of the existence of a prisoners' dilemma equilibrium in the current Israeli-Syrian arms race. Generally, this article suggests that solving military/political conflicts that evolve into an arms race by relying only on military might is an expensive and suboptimal solution. Each country should identify this phenomenon and attempt to take it into account in its decisionmaking by using appropriate policy alternatives. There are two major policy options in this case. The first option is to reach some kind of agreement with the rival (directly or through a third party). The second option is to institute force multipliers techniques.

Egy központi felvételi rendszer feladata a jelentkezők és az iskolák vagy szakok páro sítása. Ez a párosítás többféleképpen is történhet, de néhány alapelv mentén a gyak ran igen különböző felvételi rendszerek is leírhatók. Ilyen alapelvként fogalmazható meg, hogy egy párosítás legyen stabil, Pareto-optimális, vagy hogy legyen mentes a taktikázástól. Jó és kevésbé jó párosító algoritmusokat is ismertetünk, áttekintjük alapvető tulajdonságaikat, illetve kitérünk olyan jellemzőkre, amelyek meghatároz hatják egy felvételi rendszer elfogadottságát. A magyarországi felvételi rendszereket majd egy külön dolgozatban vizsgáljuk. Journal of Economics Literature (JEL) kód: C78, D61, D78, I20., The mechanisms used in centralized student assignment programme to match applicants with places in schools and on courses of study vary, but they all rest on a number of basic principles. Natural requirements for matching are stability, Pareto optimization or strategy proofing. The paper presents both good and less good matching mechanisms, discusses their properties, and relates them to their degree of success when applied in real life. The mechanisms in use in Hungary will be the subject of another paper.

The eastward enlargement of the Euro area entails significant implications for the accession candidates in Central and Eastern Europe (CEE), the existing Euro system and the monetary policy of the European Central Bank (ECB). The present analysis assesses the challenges and critical aspects in monetary policy modeling with special emphasis to enlargement. The focus is on the difficulty of implementing a unique currency policy in view or growing heterogeneity within the enlarged monetary union, and secondly - the issue of the voting mechanism within the ECB. When analyzing those two issues, it is conclusive that the difficulties for the ECB and the current Euro zone members will increase. For the enlarged Euro zone, which is becoming more divergent, it will be very hard to find adequate recipes to meet the needs and requirements of all. The big question is: whether centralization of monetary policy is a sustainable and superior solution?.

This paper proposes a first step towards a positive theory of tax instruments. We present a model of redistributive politics that extends those of Myerson [R. Myerson, Incentives to cultivate minorities under alternative electoral systems, Amer. Polit. Sci. Rev. 87 (1993) 856–869] and Lizzeri and Persico [A. Lizzeri, N. Persico, The provision of public goods under alternative electoral incentives, Amer. Econ. Rev. 91 (2001) 225–239]. Two politicians compete in terms of targeted redistributive promises financed through distortionary taxes. We solve for the case of both targetable and non-targetable taxes. We prove that there is an imperfect efficiency–targetability trade off on the tax side. Politicians prefer targetable taxes over non-targetable ones, especially when the latter are less efficient. Yet, targetable taxation is always used even when it is very inefficient compared to non-targetable taxes.

We consider several notions of setwise stability for many-to-many matching markets with contracts and provide an analysis of the relations between the resulting sets of stable allocations for general, substitutable, and strongly substitutable preferences. Apart from obtaining "set inclusion results" on all three domains, we introduce weak setwise stability as a new stability concept and prove that for substitutable preferences the set of pairwise stable matchings is nonempty and coincides with the set of weakly setwise stable matchings. For strongly substitutable preferences the set of pairwise stable matchings coincides with the set of setwise stable matchings.

The concept of well-being has deep roots in philosophy [Cantril (1965)]. Much later in the 19th century modern definitions of well-being emerged. The utilitarian movement defined well-being subjectively and proclaimed individuals’ well-being as an important goal of individuals’ behaviour and public policy. During the 20th century social scientists started to examine well-being empirically, but a unified concept of wellbeing was lacking. At the beginning of the 20th century, economists developed elaborate quantitative theories of well-being, but rejected the possibility that individuals’ could provide valid reports of their own well-being. In the second half of the 20th century social scientists started to develop subjective measures of well-being, and started to examine how these measures relate to demographic variables or other characteristics of individuals [Andrews and Withey (1976)]. The relationship between GDP and well-being likely depends on how rich a country is. As income increases it contributes little to overall well-being at low levels of GDP in poor country, since only a narrow segment of the population is benefiting directly. Moreover, as noted by Sen (2001) non-monetary benefits such as health and education that improve individual capabilities are often more important than income in poor countries. As the benefits of continued growth trickle down to a burgeoning middle class, social well-being rises dramatically [Torras (2008)]. It is in this context that a number of alternatives to GDP have been introduced. For example, the United Nations Development Programme’s (UNDP) human development index (HDI) uses GDP per capita to measure “access to economic resources” in well-being assessments but accords it only one-third weight in determination of the level of human development. Although national income accounting measures may sometimes not agree with popular perceptions of trends in economic well-being, GDP per capita is one of the three main components of the HDI, whose objective is to indicate the capability of people “to lead a long and healthy life, to acquire knowledge and to have access to resources needed for a decent standard of living” [Osberg and Andrew (2005)].

Mancur Olson’s theory of the decline of nations is path-breaking in political economics. It has been tested cross-sectionally in numerous empirical studies. We survey the existing results briefly, with a special focus on studies using the number of lobbies as an exogenous variable. Using data from the period 1973–2006, we then present the field’s first time-series analysis of the effects of the number of interest groups on the German lobby list and macroeconomic performance, gauged in terms of economic growth and inflation. The number of interest groups (as a proxy for their influence) is shown to have an important impact on macro-variables: Interest group activity significantly leads to a decline in the growth rate and a rise in the inflation rate.

From a theoretical viewpoint, political budget cycles (PBC) arise in equilibrium when rational voters are imperfectly informed about the incumbent's competency and the incumbent enjoys discretionary power over the budget. This paper focuses on the second condition, examining how executive discretion is affected by the budgetary process under separation of powers. We specifically model PBC in the composition of government spending. The main result is that effective checks and balances in the budgetary process curb PBC. The institutional features of the executive-legislature bargaining game, namely, the actual agenda-setting authority, the status quo location and the degree of legislative oversight and control of the implementation of the budgetary law, play critical roles for the existence and the size of PBC. These results are consistent with recent empirical findings, which show that PBC are more pronounced in developing countries, where there are also less effective checks and balances.

PurposeThe purpose of this paper is to analyze some of the unseen negative effects of the post‐Katrina government policies dealing with housing in New Orleans.Design/methodology/approachSince Hurricane Katrina, the government, along with private for profit and not‐for‐profit organizations, has worked to rebuild the city of New Orleans. This effort is most evident in the response to the housing crisis that followed the storm. The government has spent billions of dollars and brought thousands of people in to rebuild homes and other infrastructure in the long run and to provide stopgap measures in the short run. The approximately 120,000 Federal Emergency Management Agency (FEMA) trailers in the region are one of the most visible examples of government efforts.FindingsThe paper finds that while the trailers did provide benefits to those who received them, it could be argued that the government's policies aimed toward solving the housing crisis suffer from Frédéric Bastiat's broken window fallacy. FEMA trailers and the multitude of workers brought in are examples of what is seen, and, as Bastiat showed, we must also look at what is unseen.Originality/valueThe paper is of value in showing that the trailer problem, among many others, has weakened the relief effort.

We study the relation between international trade and the gains to reform labor markets by removing firing restrictions. We find that trade linkages imply substantially smaller benefits to reform than those calculated in the closed economy general equilibrium model of Hopenhayn and Rogerson [Hopenhayn, Hugo, Rogerson, Richard, 1993. Job Turnover and policy evaluations: a general equilibrium analysis. Journal of Political Economy 101 (5), 915–938 October]. When economies trade, labor market policies in one country spill over to other countries through their effect on the terms of trade. A key finding in the open economy is that the share of the welfare gains from domestic labor market reform exported substantially exceeds the share of goods exported. Thus, with international trade, a country retains little to no benefit from unilaterally reforming its labor market. A coordinated elimination of firing taxes yields considerable benefits. We also find that the U.K. benefits from labor market reform by its continental trading partners. These insights provide some explanation for recent efforts toward labor market reform in the European Union.

This paper studies the timing of privatization in 21 major developed economies in the 1977-2002 period. Duration analysis shows that political fragmentation plays a significant role in explaining government's decision to privatize: privatization is delayed longer in democracies characterized by a larger number of parties and operating under proportional electoral rules, as predicted by war of attrition models of economic reform. Results are robust to various assumptions on the underlying statistical model and to controlling for other economic and political factors.