Corporate Hierarchies and the Size of Nations: Theory and Evidence

Corporate organization varies within a country and across countries with country size. The paper starts by establishing some facts about corporate organization based on unique data of 660 Austrian and German corporations. The larger country (Germany) has larger firms with flatter more decentral corporate hierarchies compared to the smaller country (Austria). Firms in the larger country change their organization less fast than firms in the smaller country. Over time firms have been introducing less hierarchical organizations by delegating power to lower levels of the corporation. We develop a theory which explains these facts and which links these features to the trade environment that countries and firms face. We introduce firms with internal hierarchies in a Krugman (1980) model of trade. We show that international trade and the toughness of competition in international markets induce a power struggle in firms which eventually leads to decentralized corporate hierarchies. We offer econometric evidence which is consistent with the models predictions

Tourism income and economic growth in Greece: Empirical evidence from their cyclical components

This paper examines the relationship between the cyclical components of Greek GDP and international tourism income for Greece for the period 1976–2004. Using spectral analysis the authors find that cyclical fluctuations of GDP have a length of about nine years and that international tourism income has a cycle of about seven years. The volatility of tourism income is more than eight times the volatility of the Greek GDP cycle. VAR analysis shows that the cyclical component of tourism income is significantly influencing the cyclical component of GDP in Greece. The findings support the tourism-led economic growth hypothesis and are of particular interest and importance to policy makers, financial analysts and investors dealing with the Greek tourism industry

Knowledge politics and new converging technologies: a social epistemological perspective

The “new converging technologies” refers to the prospect of advancing the human condition by the integrated study and application of nanotechnology, biotechnology, information technology and the cognitive sciences - or “NBIC”. In recent years, it has loomed large, albeit with somewhat different emphases, in national science policy agendas throughout the world. This article considers the political and intellectual sources - both historical and contemporary - of the converging technologies agenda. Underlying it is a fluid conception of humanity that is captured by the ethically challenging notion of “enhancing evolution”

Null Models of Economic Networks: The Case of the World Trade Web

In all empirical-network studies, the observed properties of economic networks are informative only if compared with a well-defined null model that can quantitatively predict the behavior of such properties in constrained graphs. However, predictions of the available null-model methods can be derived analytically only under assumptions (e.g., sparseness of the network) that are unrealistic for most economic networks like the World Trade Web (WTW). In this paper we study the evolution of the WTW using a recently-proposed family of null network models. The method allows to analytically obtain the expected value of any network statistic across the ensemble of networks that preserve on average some local properties, and are otherwise fully random. We compare expected and observed properties of the WTW in the period 1950-2000, when either the expected number of trade partners or total country trade is kept fixed and equal to observed quantities. We show that, in the binary WTW, node-degree sequences are sufficient to explain higher-order network properties such as disassortativity and clustering-degree correlation, especially in the last part of the sample. Conversely, in the weighted WTW, the observed sequence of total country imports and exports are not sufficient to predict higher-order patterns of the WTW. We discuss some important implications of these findings for international-trade models.Comment: 39 pages, 46 figures, 2 table

How to increase technology transfers to developing countries: a synthesis of the evidence

The existing United Nations Framework Convention on Climate Change (UNFCCC) has failed to deliver the rate of low-carbon technology transfer (TT) required to curb GHG emissions in developing countries. This failure has exposed the limitations of universalism and renewed interest in bilateral approaches to TT. Gaps are identified in the UNFCCC approach to climate change TT: missing links between international institutions and the national enabling environments that encourage private investment; a non-differentiated approach for (developing) country and technology characteristics; and a lack of clear measurements of the volume and effectiveness of TTs. Evidence from econometric literature and business experience on climate change TT is reviewed, so as to address the identified pitfalls of the UNFCCC process. Strengths and weaknesses of different methodological approaches are highlighted. International policy recommendations are offered aimed at improving the level of emission reductions achieved through TT

Exporting and labor demand : micro-level evidence from Germany

It is widely believed that globalization affcts the extent of employment and wage responses to economic shocks. To provide evidence for this, we analyze the effect of firms' exporting behavior on the elasticity of labor demand. Using rich, German administrative linked employer-employee panel data from 1996 to 2008, we explicitly control for self-selection into exporting and endogeneity concerns. In line with our theoretical model, we find that exporting at both the intensive and extensive margins significantly increases the (absolute value of the) unconditional own-wage labor demand elasticity. This is not only true for the average worker, but also for different skill groups. For the median firm, the elasticity is three-quarters higher when comparing exporting to nonexporting firms

Lessons from the European Spaghetti Bowl

European economic integration fascinates and inspires for the way it brought peace to a continent torn by violent and long-standing rivalries. The lessons from Europe, however, cannot be applied directly as the degree of the European Union's supranationality is unthinkable elsewhere. This paper discusses how Europe overcame the specific problem of overlapping free trade agreements (FTAs) with the Pan-European Cumulation System which instituted common rules of origin, regional cumulation of value, and completed the full matrix of bilateral FTAs. After this, Europe had what can be thought of as a "customs union" for rules of origin

Mergers and Acquisitions in Latin America: Industrial Productivity and Corporate Governance

This paper examines the impact of industrial productivity on transnationals M&As from OECD countries towards Latin American countries in the period 1996 to 2010. It also analyzes the relationship between external mechanism of corporate governance and transnational M&As. For this purpose we use a gravitational model at the industry level. We find that industry productivity and higher standards of corporate governance in the country of origin promote transnational M&As activity. However, it is also found that higher levels of capital and technological productivity decreases transnational M&As activity

Patterns and determinants of intra-industry trade in Southeast Asia: evidence from the automotive and electrical appliences sectors

Using finely disaggregated data at six-digit harmonized code classification level, this paper examines the patterns and determinants of horizontal and vertical intra-industry trade in the automobile and electrical appliances sectors during the past few decades among the six major Southeast Asian countries. It is found from the analysis of the data that intra-industry trade is much higher than the inter-industry trade in each of these two sectors. Further, the determinants of these two types of trade are found to differ somewhat in terms of sign and magnitude across the sectors, implying the importance of sector-specific factors as influences on the pattern of trade