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on Post Keynesian Economics |
| By: | John A. List |
| Abstract: | The role of the market in mitigating and mediating various forms of behavior is perhaps the central issue facing behavioral economics today. This study designs a field experiment that is explicitly linked to a controlled laboratory experiment to examine whether, and to what extent, social preferences influence outcomes in actual market transactions. While agents drawn from a well-functioning marketplace behave in accord with social preference models in tightly controlled laboratory experiments, when observed in their naturally occurring settings their behavior approaches what is predicted by self-interest theory. In the limit, much of the observed behavior in the marketplace that is consistent with social preferences is due to reputational concerns: suppliers who expect to have future interactions with buyers provide higher product quality only when the buyer can verify quality via a third-party certifier. The data also speak to theories of how reputation effects enhance market performance. In particular, reputation and the monitoring of quality are found to be complements, and findings suggest that the private market can solve the lemons problem through third party verification. |
| JEL: | C93 D63 D64 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11616&r=pke |
| By: | Norman Loayza; Romain Rancière |
| Abstract: | This paper studies the apparent contradiction between two strands of the literature on the effects of financial intermediation on economic activity. On the one hand, the empirical growth literature finds a positive effect of financial depth as measured by, for instance, private domestic credit and liquid liabilities (e.g., Levine, Loayza, and Beck 2000). On the other hand, the banking and currency crisis literature finds that monetary aggregates, such as domestic credit, are among the best predictors of crises and their related economic downturns (e.g., Kaminski and Reinhart 1999). The paper accounts for these contrasting effects based on the distinction between the short- and long-run impacts of financial intermediation. Working with a panel of cross-country and time-series observations, the paper estimates an encompassing model of short- and long-run effects using the Pooled Mean Group estimator developed by Pesaran, Shin, and Smith (1999). The conclusion from this analysis is that a positive long-run relationship between financial intermediation and output growth co-exists with a, mostly, negative short-run relationship. The paper further develops an explanation for these contrasting effects by relating them to recent theoretical models, by linking the estimated short-run effects to measures of financial fragility (namely, banking crises and financial volatility), and by jointly analyzing the effects of financial depth and fragility in classic panel growth regressions. |
| Keywords: | Financial development |
| JEL: | G21 C33 |
| Date: | 2004–09 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:855&r=pke |
| By: | Bruinshoofd,Allard; Candelon,Bertrand; Raabe,Katharina (METEOR) |
| Abstract: | We show that, complementary to trade and financial linkages, the strength of the bankingsector helps explain the transmission of currency crises. Specifically, we demonstrate thatthe Mexican, Thai, and Russian crises predominantly spread to countries with weaknesses intheir banking sectors. At the same time, the role of banking sector strength varies per crisis;where the Mexican crisis spread to countries with a strong presence of foreign banks indomestic credit provision, the Thai crisis disproportionately contaminated countries wherethe banking sector was most sensitive to currency realignments, wh ile the Russian crisisspread to countries with inefficiencies in the banking sector. |
| Keywords: | macroeconomics ; |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:umamet:2005023&r=pke |
| By: | Horst Hanusch (University of Augsburg, Department of Economics); Andreas Pyka (University of Augsburg, Department of Economics) |
| Abstract: | Within the last 25 years large progress has been made in Neo-Schumpeterian Economics, this branch of economic literature which deals with dynamic processes causing qualitative transformation of economies basically driven by the introduction of novelties in their various and multifaceted forms. By its very nature, innovation and in particular technological innovation is the most exponent and most visible form of novelty. Therefore it is not very surprising that Neo-Schumpeterian Economics today has its most prolific fields in the studies of innovation and learning behavior on the micro-level of an economy, the studies on industry dynamics on the meso-level and studies of innovation driven growth and competitiveness on the macro-level of the economy. From a general point of view, however, the future developmental potential of socio-economic systems i.e. innovation in a very broad understanding encompassing besides technological innovation also organizational, institutional and social innovation has to be considered as the normative principle of Neo-Schumpeterian Economics. In this sense, innovation plays a similar role in Neo-Schumpeterian Economics like prices do in Neoclassical Economics. Instead of allocation and efficiency within a certain set of constraints, Neo-Schumpeterian Economics is concerned with the conditions for and consequences of a removal and overcoming of these constraints limiting the scope of economic development. Thus, Neo-Schumpeterian Economics is concerned with all facets of open and uncertain developments in socio-economic systems. A comprehensive Neo-Schumpeterian approach therefore has to consider not only transformation processes going on e.g. on the industry level of an economy, but also on the public and monetary side of an economic system. Our contribution introduces those extensions and complements to a comprehensive Neo-Schumpeterian economic theory, and develops some guideposts in the sense of a roadmap for necessary strands of analysis in the future in order to fulfill the claim of becoming a comprehensive approach comparable to neoclassical theory. |
| Keywords: | Neo-Schumpeterian economics, industrial dynamics, public finance, financial markets |
| JEL: | O30 O40 L2 P0 G10 B52 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:aug:augsbe:0278&r=pke |