nep-hme New Economics Papers
on Heterodox Microeconomics
Issue of 2011‒11‒28
twelve papers chosen by
Frederic S. Lee
University of Missouri-Kansas City

  1. An Informationalised Economy in Africa? The Impact of New ICT on the Wood Products Industry in Durban, South Africa By Pádraig Carmody;
  2. Beginnings of financial reporting and premises of consolidation of accounts in French aluminium industry,1921-1939 By Didier Bensadon
  3. The accounting regulation in the French context: The case of corporate groups (1921-1943) By Didier Bensadon
  4. Industrial policies and capabilities for catching up: Frameworks and paradigms By Irmgard Nübler
  5. The Old Boy Network: Gender Differences in the Impact of Social Networks on Remuneration in Top Executive Jobs By Lalanne, Marie; Seabright, Paul
  6. A century of growth? A history of tobacco production and marketing in Malawi 1890-2005 By Prowse, Martin
  7. A comparative value chain analysis of burley tobacco in Malawi - 2003/04 and 2009/10 By Prowse, Martin
  8. Relative prices, the price level and inflation: Effects of asymmetric and sticky adjustment By Shruti Tripathi; Ashima Goyal
  9. Poverty and health behaviour: Comparing socioeconomic status and a combined poverty indicator as a determinant of health behaviour By Aue, Katja; Roosen, Jutta
  10. Airline Pricing under Different Market Conditions: Evidence from European Low-Cost Carriers By Volodymyr Bilotkach; Alberto A. Gaggero; Claudio A. Piga
  11. Technology, Distribution and the Rate of Profit in the US Economy: Understanding the Current Crisis By Deepankar Basu; Ramaa Vasudevan
  12. How the Future Shaped the Past: The Case of the Cashless Society By Batiz-Lazo, Bernardo; Haigh, Thomas; stearns, David L.

  1. By: Pádraig Carmody (Geography and Institute for International Integration Studies, Trinity College Dublin);
    Abstract: Sub-Saharan Africa (SSA) experienced a process of marginalization in the global economy in the 1980s and 1990s. Some now assert this is being reversed by an information technology revolution on the sub-continent. SSA now has the fastest growing mobile phone penetration rates in the world and most people there now live under the "footprint" of mobile phones. However, while many claims are made for the poverty reduction potential of new ICTs, very little research has been done on how access affects firm strategies, and innovation and consequently may contribute to broader economic transformation; vital to sustainable poverty reduction. This paper contextualises the adoption of new ICTs and then examines evidence of the uses and impacts of new ICTs in the wood products industry in Durban, South Africa and its surrounding region. It finds that while ICT usage is being routinised in the sector, their impacts are incremental than transformative. Consequently while these technologies are being absorbed into the socio-technical regime, their overall economic impact is limited.
    Keywords: Information technology, wood products, South Africa
    Date: 2011
  2. By: Didier Bensadon (DRM - Dauphine Recherches en Management - CNRS : UMR7088 - Université Paris Dauphine - Paris IX)
    Abstract: The expansion of groups of companies during the inter-war years is one of the most profound transformations in the structure of French capitalism. Studies in economic history have shown the importance of the subsidiary creation phenomenon in relation to Compagnie Générale d'Electricité, Energie industrielle or Schneider . By contrast, these studies are less interested in the specific arrangements for auditing subsidiaries and managing Company Groups. This article seeks to show how and why the directors of Alais, Froges et Camargue - The largest French company in the aluminum sector- established specific audit measures from the 1920s onwards. This research is essentially based on the company's archives (annual reports, general organisation chart and memoranda from the general secretariat). Even if the results published in the annual reports should be treated with the utmost caution, in particular owing to the absence of accounting regulation in France in the inter-war years, they remain essential for assessing the important position of subsidiaries and main shareholdings in assets. The scope of the subsidiary creation phenomenon, which is behind the establishment of specific controls, is highlighted. This trend, far from being linear, is strongly influenced by the economic and political situation. The size of the Group's growth gave rise to two types of requirements for the directors of Alais, Froges et Camargue, namely to audit the subsidiaries and to measure the group's net cash flow. The response to the need for auditing the subsidiaries was provided by the introduction of financial reporting from 1921. Faced with the increasing number of subsidiaries and main shareholdings held by Alais, Froges et Camargue, this control mechanism was to be strengthened in 1931. Furthermore, the necessity of measuring the Group's net cash flow led the directors in 1927 to draw up a financial statement whose conceptual foundations were based on those of the consolidation of accounts
    Keywords: financial reporting, accounting history, group accounts, French aluminium industry, shareholdings.
    Date: 2011–11–03
  3. By: Didier Bensadon (DRM - Dauphine Recherches en Management - CNRS : UMR7088 - Université Paris Dauphine - Paris IX)
    Abstract: The aim of this paper is to shed light on the role of legislators and lawyers in establishing accounting regulations concerning corporate groups in France during the 1930s and the Occupation (1940 - 1944). A review of bills proposing accounting regulation shows that no significant progress was to be achieved. Furthermore, while some lawyers called for a comprehensive regulation of corporate groups, no such progress was made during the inter-war period. Ultimately it's the Vichy government which introduced the first regulations on accounting subsidiaries in the French Plan Comptable and limited the reciprocal shareholdings in the Act of March 4, 1943.
    Keywords: Accounting history, corporate groups, accounting regulation, inter war period, Occupation period, France
    Date: 2011–09–12
  4. By: Irmgard Nübler (International Labour Office, Economic and Labour Market Analysis Department)
    Abstract: After the crisis, interest in industrial policy, productive transformation and catch-up growth have made a remarkable comeback both in academic circles and in the policies of governments in many developing countries. It is now a good time to revisit the industrial policy debate, and to promote a more sophisticated understanding of the institutional, informational and political economy balances necessary for productive transformation policies to be successful. This paper evaluates the different economic frameworks for analysis and design of industrial and productive transformation policies with a view to promoting a dynamic and high-performing catching-up process. The analysis suggests the need to frame industrial policies within a dynamic and wider concept of productive transformation, which is linking structural changes in production and employment with the accumulation of domestic capabilities. This approach embeds industrial policies as an essential part of the development agenda.
    Keywords: industrial policy / economic growth / industrial development / economic development / employment / developing countries
    Date: 2011
  5. By: Lalanne, Marie; Seabright, Paul
    JEL: A14 J16 J31 J33
    Date: 2011–10
  6. By: Prowse, Martin
    Abstract: During the past century tobacco production and marketing in Nyasaland/Malawi has undergone periods of dynamism similar to changes since the early 1990s. This article highlights four recurrent patterns. First, estate owners have either fostered or constrained peasant/smallholder production dependent on complementarities or competition with their estates. Second, rapid expansion of peasant/smallholder production has led to three recurrent outcomes: a large multiplier effect in tobacco-rich districts; re-regulation of the marketing of peasant/smallholder tobacco by the (colonial) state; and, lastly, concerns over the supply of food crops. The article concludes by arguing that whilst the reform of burley tobacco production and marketing in the 1990s engaged with the first two issues, it may have benefitted from paying greater attention to the latter two issues as well.
    Date: 2011–11
  7. By: Prowse, Martin
    Abstract: This article conducts a value chain analysis of smallholder burley tobacco production in Malawi for the 2003/04 and 2009/10 agricultural seasons. The comparison suggests in 2003/04 smallholder profits from growing burley were limited by two main factors: first, the practices of leaf merchant companies on the auction floors who operated as a cartel (and governed the burley supply thread); and secondly, by inefficient marketing arrangements. By the 2009/10 season the rents, governance and systemic efficiency within the supply thread had changed considerably: there was greater competition on the auction floors largely due to direct state intervention (which increased growers' net margins in nominal terms), improvements in marketing arrangements, tighter state regulation (including the introduction of minimum prices for grades of burley) and increased systemic efficiency (through a rapid expansion of contract farming). The article concludes by highlighting some of the opportunities and threats that this form of vertical integration poses smallholder growers.
    Date: 2011–11
  8. By: Shruti Tripathi (Indira Gandhi Institute of Development Research); Ashima Goyal (Indira Gandhi Institute of Development Research)
    Abstract: The paper examines how relative price shocks can affect the price level and then inflation. Using Indian data we find: (i) price increases exceed price decreases. Aggregate inflation depends on the distribution of relative price changes-inflation rises when the distribution is skewed to the right, (ii) such distribution based measures of supply shocks perform better than traditional measures, such as prices of energy and food. They moderate the price puzzle, whereby a rise in policy rates increases inflation, and are significant in estimations of New Keynesian aggregate supply, (iii) an average Indian firm changes prices about once in a year; the estimated Calvo parameter implies half of Indian firms reset their prices in any period, and 66 percent of firms are forward looking in their price setting. The implication of these estimated real and nominal price rigidities for policy are drawn out.
    Keywords: WPI, NKPC, asymmetric, stickiness, size, frequency, inflation
    JEL: E31 E12 C32
    Date: 2011–10
  9. By: Aue, Katja; Roosen, Jutta
    Abstract: Studies in the area of health economics and public health have shown that low socioeconomic status (SES) and poverty are related to lower levels of health. Attempts to explain these differences have often made reference to the observation that poor health behaviours cluster in low SES respectively poverty groups. However, relatively little attention has been paid to the defining concept of SES and its appropriate measurement. Therefore data from the German Socio-Economic Panel are used to analyse the relationship between two multidimensional measurements to describe a) poverty respectively b) a low SES and health behaviour, including dietary behaviour, weight status and health behaviour in general. This study shows that both multidimensional indicators allow identifying an inverse relationship between low SES respectively poverty and several types of health behaviour. However, comparing both indicators it is evident that individuals may be affected by poverty in different ways which has various effects on their health behaviour. Additionally, future research should focus not only on multidimensional poverty measurements but also on dynamic effects.
    Keywords: poverty, social inequality, diet, BMI, health behaviour, Agricultural and Food Policy, Consumer/Household Economics, Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Health Economics and Policy, I1, I3,
    Date: 2010
  10. By: Volodymyr Bilotkach (University of California, Irvine); Alberto A. Gaggero (University of Pavia); Claudio A. Piga (Loughborough University; RCEA)
    Abstract: Traditional theories of airline pricing maintain that fares monotonically increase as fewer seats remain available on a flight. A fortiori, this implies a monotonically increasing temporal profile of fares. In this paper, we exploit the presence of drops in offered fares over time as an indicator of an active yield management intervention by two main European Low-Cost Carriers observed daily during the period June 2002 - June 2003. Our results indicate that yield management is effective in raising a flight's load factor. Furthermore, yield management interventions are more intense, and generate a stronger impact, on more competitive routes: one possible interpretation is that a reduction in competitive pressure allows the carriers to adopt a more standardized approach to pricing. Similarly, we find that yield management interventions are more effective in raising the load factor on routes where the customer mix is more heterogenous (i.e., it includes passengers traveling for leisure, business and for family matters). On markets with homogeneous customer base, no robust yield management effect was observed.
    Keywords: Easyjet, Intertemporal Pricing, Panel Data, Ryanair, Yield Management
    JEL: L11 L93
    Date: 2011–11
  11. By: Deepankar Basu (University of Massachusetts Amherst); Ramaa Vasudevan
    Abstract: This paper offers a synoptic account of the state of the debate within Marxist scholars regarding the current structural crisis of capitalism, identifies two broad streams within the literature dealing, in turn, with aggregate demand and profitability problems, and proceeds to concentrate on an analysis of issues surrounding the profitability problem in two steps. First, evidence on profitability trends for the Nonfarm Nonfinancial Corporate Business, the Nonfinancial Corporate Business and the Corporate Business sectors in post-War U.S. are summarized. A broad range of profit rate measures are covered and data from both the U.S. Bureau of Economic Analysis (NIPA and Fixed Asset Tables) and the Federal Reserve (Flow of Funds Account) are used. Second, the underlying drivers of profitability, in terms of technology and distribution, are investigated. The profitability analysis is used to offer some hypotheses about the current structural crisis. JEL Categories: B51, E11
    Keywords: profitability, technological change, income distribution, structural crisis
    Date: 2011–11
  12. By: Batiz-Lazo, Bernardo; Haigh, Thomas; stearns, David L.
    Abstract: This paper invites readers to look into how beliefs about future events help to better understand organizational change. Our argument is that the adoption of information technology and the adoption of new organizational forms around it have been driven by shifts in collective ideas of legitimate organizational development. As an example we focus on the establishment during the 1960s of a vision within US retail financial services, namely of the “cashless/checkless society”. The article tells of the power of this “imaginaire” to bring consensus in driving actual technological developments.
    Keywords: imaginaires; expectations; isomorphism; cashless society; payment systems; USA
    JEL: N82 E42 N22
    Date: 2011–11

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