Search

Distributional implications of capital account regulation is eminently context-specific. This paper examines the distributional effects of the openness of foreign direct investment (FDI) flows across 27 European countries in different economic environments around the Great Recession, covering the period 2007–2013. Our multi-level approach allows us to combine country-level variables and sociodemographic characteristics of individuals. The results highlight that the openness of FDI flows heterogeneously affects the income share of individual groups, favouring in particular the highest income classes. This finding seems to be driven by the educational level. We argue that even though highly educated individuals are present along the entire distribution, the highest income classes are especially favoured by the openness of FDI flows. This biased distributional effect of the openness of FDI flows persists throughout the years examined, regardless of the economic environment; this is due, in part, to the fact that the distribution of highly educated people is not sensitive to the business cycle. [ABSTRACT FROM AUTHOR]

This paper aims at an understanding of acquisition processes in a strongly industrialized and export‐oriented economy in Central Europe. Drawing on a proximity framework and behaviour theory, the paper investigates that the geographical proximity dimension is more influential than the cognitive proximity dimension. At the same time, cognitive proximity matters more for foreign firms investing into the economy than for domestic acquisitions. While the role of cognitive proximity diminished during the economic crisis, geographical proximity keeps its importance throughout the economic cycle. Moreover, cognitive proximity has become more important for acquisitions of large companies and less for SMEs. [ABSTRACT FROM AUTHOR]

Purpose - This paper aims to study the stock market reaction to sporting results of European listed football clubs. Specifically, it tries to examine the impact of the sporting results on the stock market valuation in terms of abnormal returns and trading volume around the dates of matches. Design/methodology/approach - This paper undertakes an event study around the dates of 745 matches played by European listed football clubs. Findings - The empirical analysis shows that the sporting results of listed football clubs affect both the abnormal returns and the trading volume around the dates of matches. The movement (positive or negative) and the time when the impact occurs (before or after the match) differ according to the nature of the result (defeat, draw or win) and the match venue (home or away). Findings in this study imply that the success of investments in listed football clubs requires a regular follow-up of their sporting performances. Originality/value - This paper is one of the first to take into consideration the nature of sporting results (defeat, draw or win) according to the match venue (home or away) in order to study the market reaction in terms of both abnormal returns and trading volume. Unlike some previous studies, it is not limited to studying a single specific context but considers listed football clubs from all over Europe. [ABSTRACT FROM AUTHOR]

This paper investigates the major determinants of bank performance in the European sector, taking into consideration the most important financial groups from this region. To account for performance, we have applied two fixed-effects regression models to a panel of European banks that covers the period 2004-2012, where profitability was assessed through two variables, namely return on average equity and net interest margin. The estimation results show that all bank-specific determinants affect bank profitability significantly, but not always in the anticipated way. Finally, the business cycle has a positive, albeit asymmetric impact on bank profitability, suggesting that profitability is pro-cyclical. [ABSTRACT FROM AUTHOR]

Synchronization of growth rates are an important feature of international business cycles, particularly in relation to regional integration projects such as the single currency in Europe. Synchronization of growth rates clearly enhances the effectiveness of European Central Bank monetary policy, ensuring that policy changes are attuned to the dynamics of growth and business cycles in the majority of member states. In this paper, a dissimilarity metric is constructed by measuring the topological differences between the GDP growth patterns in recurrence plots for individual countries. The results show that synchronization of growth rates were higher among the euro area member states during the second half of the 1980s and from 1997 to roughly 2002. Apart from these two time periods, euro area member states do not appear to be more synchronized than a group of major international countries, suggesting that apart from specific times when European integration initiatives were being implemented, globalization was likely the dominant factor behind international business cycle synchronization. [ABSTRACT FROM AUTHOR]

In this paper we analyze whether the ECB’s monetary policy has become more balanced towards the needs of the individual member states with the passage of time. We assume that the ECB’s monetary policy stance is in line with a Taylor rule and based on the overall situation in the Euro area, more specifically on the Euro area inflation rate and the overall business cycle position in the area. The question therefore boils down to investigating whether inflation and business cycles have converged since the start of the monetary union. We show that the ECB, if in existence in the 1990s, would have had an impossible task. This is because inflation and business cycles still strongly differed in that time, although convergence substantially increased in the run up to the monetary union. In this respect, the decade under EMU drastically differs from the preceding one. This being said, the evidence for a further improvement in the course of the first decade of the new millennium is mixed. This is because although inflation has further converged, business cycles have shown a tendency for increased divergence. If, however, we are willing to put weights on inflation and output gap divergence (as implied by the Taylor rule), we conclude that also in the course of the period under EMU in general the ECB’s monetary policy has become more in line with the needs of the individual members. Looking at individual countries, we show that during the first decade of its existence the ECB’s interest rate was most fitted to the needs of France and Italy, and least to the needs of Ireland and Greece (both too low) and Germany (too high). To a lesser extent there were also mismatches for Spain and Portugal (both too low). In the more recent period since 2005, the mismatch between the desired domestic interest rate and the desired ECB rate has come down for most countries (most noticeable Germany). For Belgium (for which a higher interest rate was more appropriate), on the other hand, the mismatch increased. These overall positive findings, however, offer no guarantee that the task of the ECB will become easier in the future. [ABSTRACT FROM AUTHOR]

Purpose - This paper aims to investigate the alignment between the information-processing needs and capabilities during interorganizatinal relationships through the lenses of both the product and the business relationships life cycle concepts, and the types of information exchanged. Design/methodology/approach - This paper follows up on a previous empirical study conducted in the automotive sector, investigating the electronic collaboration within the supply chain of a large European Automotive Supplier (EAS). Out of the 61 respondents from this previous study, four illustrative cases are selecced to further investigate their information alignment, where each case involves one specific relationship between EAS and its business partners based on the supply chain collaboration classification provided by the German Association of the Automotive Industry (VDA). Findings - The conclusion is that the phenomenon is bimodal and requires that the different information-processing needs and capabilities associated with each stage of both the product and the business relationships life cycles should be considered. Research limitations/implications - The small number of illustrative cases and the specificity of the chosen sector limit the generalizability of the results. Without considering the various types of information-processing needs and capabilities as well as the stage of both product and business relationships life cycles, a biased conclusion could lead to inappropriate information and communication technology investments and business decisions. Originality/value - The richness of the cases and the genuine integration of the life cycle concepts and the type of information with the notion of alignment help to identify some key aspects of interorganizational relationships. [ABSTRACT FROM AUTHOR]

Copyright of Serbian Journal of Management is the property of Serbian Journal of Management 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 presents a quarterly global model combining individual country vector error-correcting models in which the domestic variables are related to the country-specific foreign variables. The global VAR (GVAR) model is estimated for 26 countries, the euro area being treated as a single economy, over the period 1979–2003. It advances research in this area in a number of directions. In particular, it provides a theoretical framework where the GVAR is derived as an approximation to a global unobserved common factor model. Using average pair-wise cross-section error correlations, the GVAR approach is shown to be quite effective in dealing with the common factor interdependencies and international co-movements of business cycles. It develops a sieve bootstrap procedure for simulation of the GVAR as a whole, which is then used in testing the structural stability of the parameters, and for establishing bootstrap confidence bounds for the impulse responses. Finally, in addition to generalized impulse responses, the current paper considers the use of the GVAR for ‘structural’ impulse response analysis with focus on external shocks for the euro area economy, particularly in response to shocks to the US. Copyright © 2007 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

The paper aims to identify those factors that cause changes in the speed and strength of the international transmission of output shocks from the USA to specified European economies. These factors are identified through the use of generalized impulse response functions conditioned on histories defined by an abrupt transition VAR. The chosen transition variables comprise changes in exchange rates, financial prices, international capital flows, trade links and monetary policy instruments. Besides the identification of asymmetric responses, the proposed model is useful in analyzing the strong effect of the recent US recession on the European economies and changes in business cycle synchronization over time. Copyright © 2007 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

This paper extends our previous research on East Asia to the case of 14 European countries from 1977 to 1999. According to our empirical results, intra industry trade is again the major channel through which the business cycles of European countries become synchronized. This contrasts with existing studies that found that increased trade itself led to the synchronization of business cycles. Our findings have important implications for the adoption of a currency union, as we expect that the costs of joining a currency union will diminish significantly only when intra industry trade becomes dominant. JEL no. E32, F33, F36, F41 [ABSTRACT FROM AUTHOR]

The article presents a discussion related to business cycle written by Milton Gilbert and a reference to the paper written on the same topic by Jacques J. Polak and Rudolf R. Rhomberg. Europe has had only two recessions since the war, one in 1952 and one in 1958, contrasted with the four that the U.S. has had. The 1952 recession was due mainly to restraints exercised by the policy-making authorities for the purpose of correcting balance-of-payments difficulties, although the reaction from the Korean boom was also a factor, it was secondary. The 1958 recession was also due to policy restraints exerted during the three years from 1955 to 1957. These restraints were applied mostly to correct excess demand, overfull employment, and inflationary pressures, although balance-of-payments difficulties were a factor in some or most cases. Thus the only recessions resulted from policy measures, taken deliberately. The recessions also were ended by policy management. Restraints were relaxed when the authorities considered that expansion could be safely resumed. And it did resume.

Globalization and business cycles are equally elusive economic phenomena; hence they represent a continuous research possibility and a source of possible inquiries due to their complex nature. The aim of the paper is to explain the synchronization of business cycles using the relationship between the growth rate of the GDP and FDI, considered as percentage of the GDP. The results show that there is no unique European business cycle, but two cores between which countries migrate and stress out the importance of the FDI channel in business cycle transmission. The future research directions will employ fuzzy cluster techniques, used on a larger sample. [ABSTRACT FROM AUTHOR]

Business cycle synchronization represents a condition for the successful implementation of the common monetary policy within the Economic and Monetary Union. There is a tight relation between business cycle synchronization and the economic convergence of the Member States of the Monetary Union. Investigating the specialized literature, this study analyses below the factors which influence the synchronization of the economic fluctuations of the economies in the Euro area. A second objective of this study is represented by the pointing out of the evolution of the synchronization process of the business cycle after the adoption of the euro, in the euro area countries by reference to the empiric evidence. The hypothesis of the study states that the introduction of the unique currency in 1999 resulted into the increase of the synchronization degree of the business cycle. [ABSTRACT FROM AUTHOR]

Unemployment shows persistent and long-lasting responses to nominal and real shocks. Standard real business cycle models with search frictions but a homogeneous labor force are able to generate some volatility and persistence, but not enough to match the empirical evidence. Moreover, empirical studies emphasize the importance of the heterogeneity of the unemployment pool to fully understand unemployment dynamics. In particular, in most European countries the incidence of long-term unemployment is large and well known. One of the possible causes/consequences of long-term unemployment is the skill deterioration of the unemployment pool. In this paper, we introduce the skill loss mechanism, and therefore a heterogeneous labor force, in a New Keynesian framework with search frictions. Calibrating the model for the Spanish economy, we show that while the skill loss mechanism helps to explain the magnitude of the response of unemployment to monetary shocks, it does not improve the performance of the homogeneous worker model in terms of the persistence of the response, especially for short- and long-term unemployment. [ABSTRACT FROM AUTHOR]

The dating of a possible European business cycle has been inconclusive. At this stage, there is no consensus on the existence of such a cycle, or of its periodicity and amplitude, or of the relationship of individual member countries to that cycle. Yet convergence to a common cycle is the key consideration for a successful economic performance in any currency union. The confusion over whether and to what degree the Eurozone countries are converging on a common cycle is one example of this lack of consensus. In general, countries may vary in the components and characteristics that make up their output cycles; and also in their position around the output cycle at each point of time. In this paper we show how to decompose a business cycle into a time–frequency framework. This then allows us to decompose movements in output, at the European level and in member countries, into the component cycles and permits us to see how those component cycles (and the coherence between them) have varied in importance and cyclical characteristics over time. That in turn allows us to determine if the inconclusive convergence results obtained in the past have appeared because member countries have some cycles in common—but diverge at other cycles as a result of the asymmetric transmission of shocks, or external factors, or country specific shocks. [ABSTRACT FROM AUTHOR]

This paper uses a three-region framework to examine the effects of European currency unification on EMU and US inflation rates. It considers ways in which increased participation in the EMU might influence inflation choices in Europe and the United States. It also considers how alternative monetary policies and parameter values might influence the extent of participation in the EMU. [ABSTRACT FROM AUTHOR]

This paper deals with the existence and identification of a common European growth cycle. Univariate Markov switching autoregressions are used for individual countries in order to detect changes in the mean growth rate of industrial production. A Markov switching vector autoregression model is then used to identify a common cycle in Europe. Three important results are obtained: we find a common unobserved component governing European business cycle dynamics, suggesting the existence of a common business cycle; we propose a dating of the business cycle, both for an index of industrial protection and GDP, and both chronologies appear to be consistent; and finally we retrieve an important set of stylized facts and relate these with those reported for the US. Finally two further issues are investigated: first, the contribution of the European business cycle to the individual country cycles; and second, we undertake an impulse response analysis to investigate the response of each individual country to European expansions and recessions. [ABSTRACT FROM AUTHOR]

Business fluctuations are associated with business cycles but are not implying the regularity. We consider that the lobbying activities can influence the periods of economic recession and expansion from business fluctuations. The role of lobbying is to affect the decisions made by officials in the government or international corporations and agencies or organizations. In this paper we describe the structure of lobbying practice in European Union, Canada and United States of America and the characteristics of business fluctuations. Specifically, this paper looks at the lobbying activities evolution in European Union, Canada and United States of America and also at a potential relationship between lobbying and business fluctuations, from periods of boom to periods of recession. [ABSTRACT FROM AUTHOR]

This paper highlights how the impact of the global economic recession delays "social Europe" with different intensity across Member States, and discusses the steps taken by European institutions to mitigate that impact. Revealing the weak macro-economic performance of some Euro Area Member States, it underlines the most affected sectors of social life, asking questions and trying to answer them. The second part of the paper will explain the way the crisis affects European pension systems. Based on statistical analysis, the paper demonstrates that both the fully funded pensions and the pay-as-you-go pension plans are negatively affected by the recession. It concludes that any therapy must also include accountability and even so, it does not prevent a real "social crisis" from occurring in the future. [ABSTRACT FROM AUTHOR]

The main objective of this paper is to assess the importance of the Balassa-Samuelson effect in Croatia and to quantify its influence on inflation and the real exchange rate. The productivity growth differential between tradable and nontradable sectors within a given country compared to abroad has recently often been used to explain the real appreciation of Central and East European (CEE) transition countries' currencies against euro, and also to explain the inflation differential between the aforementioned countries and the euro area. Since all new EU member states are obligated to introduce the euro as the national currency, the Balassa-Samuelson effect associated with real convergence could impede nominal convergence and fulfilment of the necessary Maastricht criteria. The main conclusion of this paper is that in the period from 1998:Q1 to 2006:Q3 the Balassa- Samuelson effect in Croatia was not statistically significant, so it should not constitute a barrier to meeting convergence criteria. [ABSTRACT FROM AUTHOR]

This article presents a list of papers related to economic history of Europe. Some of the papers are: "An early Garolingian Mint in the Low Gountries: Bona-Tiel," by M. Metcalf; "Financial Intermediaries and Economic Development, the Belgian Case," by R.J. Morrison; "Middeleeuwse sociale structuren. Enkele kanttekeningen,"by J. Mertems; "Dutch Theology, Trade and War: 1590-1610," by C. Bangs; and others.

Metropolitan decline in southern Europe was documented in few cases, being less intensively investigated than in other regions of the continent. Likely for the first time in recent history, the aftermath of the 2007 recession was a time period associated with economic and demographic decline in Mediterranean Europe. However, the impacts and consequences of the great crisis were occasionally verified and quantified, both in strictly urban contexts and in the surrounding rural areas. By exploiting official statistics, our study delineates sequential stages of demographic growth and decline in a large metropolitan region (Athens, Greece) as a response to economic expansion and stagnation. Having important implications for the extent and spatial direction of metropolitan cycles, the Athens' case—taken as an example of urban cycles in Mediterranean Europe—indicates a possibly new dimension of urban shrinkage, with spatially varying population growth and decline along a geographical gradient of income and wealth. Heterogeneous dynamics led to a leapfrog urban expansion decoupled from agglomeration and scale, the factors most likely shaping long-term metropolitan expansion in advanced economies. Demographic decline in urban contexts was associated with multidimensional socioeconomic processes resulting in spatially complex demographic outcomes that require appropriate, and possibly more specific, regulation policies. By shedding further light on recession-driven metropolitan decline in advanced economies, the present study contributes to re-thinking short-term development mechanisms and medium-term demographic scenarios in Mediterranean Europe. [ABSTRACT FROM AUTHOR]

We analyze whether financial integration leads to converging or diverging business cycles using a dynamic spatial model. Our model allows for contemporaneous spillovers of shocks to GDP growth between countries that are financially integrated and delivers a scalar measure of the spillover intensity at each point in time. For a financial network of ten European countries from 1996 to 2017, we find that the spillover effects are positive on average and much larger during periods of financial stress, pointing towards stronger business cycle synchronization. Dismantling GDP growth into value added growth of ten major industries, we observe that spillover intensities vary significantly. The findings are robust to a variety of alternative model specifications. [ABSTRACT FROM AUTHOR]

The article reviews the literature related to business cycles. Strands of literature mentioned are business cycle convergence and income convergence. Empirical patterns for business cycles in the Euro Area (EA) are with convergences and correlations. Also correlation between Central, Eastern and Southeastern European (CESEE) and EA countries is also discussed.

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.)

Considering the fact that the airlines' market is very sensitive to the economic fluctuation, in this paper, we will analyze the impact of the 2001 and 2007 crises on the evolution of the European low-cost carriers, in terms of annual revenues and profits, number of routes, of transported passengers and changes occurred in the implemented strategies. In order to reach up this objective, we have conducted a complex analysis of the secondary data included in various international statistical reports, air transport journals, Official Airlines Guide databases and in the operators' publications. The analysis of the information obtained showed that the two crises from the beginning of the XXIst century did not influenced very much the European low-cost airlines. In order to cope with the unfavorable economic situation, most of the European low-cost operators have implemented different strategies: while some of them have adopted a cost-cutting program, others were launching an expansion strategy. Actually, the largest European low-cost carriers (such as Ryanair and easyJet), took advantage of the unfavorable global situation, by offering more services at low prices in order to increase their market share and, consequently, the profits. Yet, the small and medium European low-cost airlines have better surpassed the 2001 crisis than the 2007 downturn [ABSTRACT FROM AUTHOR]

This paper aims to provide a monetary analysis of the economic and financial crisis in Europe. The main focus is concentrated on monetary evolutions surrounding the Single European currency - prevention mechanisms, financing of deficits, monetary indications, enlargement and perspectives of the Euro Zone. Also, the Romanian perspective of these evolutions is presented. [ABSTRACT FROM AUTHOR]

In the long history of rising and persistent unemployment in Europe, almost all welfare-state institutions-employment protection legislation, unions, wages, wage structure, unemployment insurance, etc.-have been alleged to have caused and found guilty of causing this tragic development at some point in time. Later, welfare-state institutions in interaction with external shocks were identified as more plausible causes of rising equilibrium unemployment in Europe. Monetary policy has managed, to be regarded as innocent. Based on the assertion of the neutrality of money in the medium and long run, the search for causes of European unemployment has shied away from the policy of central banks. But actually the institutional set- up regarding monetary policy is very different between the Federal Reserve System (Fed) and the Bundesbank and its successor, The European Central Bank (ECB). We argue that the interaction of adverse shocks and tight monetary policies may have been the major-although probably not the only-cause of unemployment in Europe remaining at ever higher levels after each recession. We identify the monetary policy of the Bundesbank as asymmetrical, in the sense that the Bank did not actively fight against recessions, but it dampened recovery periods. Less constraint on growth would have kept German unemployment at lower levels. [ABSTRACT FROM AUTHOR]

"Time-to-build" models of investment expenditures play an important role in many traditional and modern theories of the business cycle, especially for explaining the dynamic propagation of shocks. We estimate the structural parameters of a time-to-build model using annual firm-level investment data on equipment and structures. For expenditures on equipment, we find no evidence of time-to-build effects beyond one year. For expenditures on structures, by contrast, there is clear evidence of such effects in the range of two to three years. The contrast between equipment and structures is intuitively reasonable and consistent with previous results. The estimates for structures also indicate that initial-period expenditures are low and increase as projects near completion. These results provide empirical support for including "time-to-plan" effects for investment in structures. More generally, these results suggest a potential source of specification error for Q models of investment and production-based asset pricing models that ignore the time required to plan, build, and install new capital. [ABSTRACT FROM AUTHOR]

We analyse regional business cycle synchronization in the Euro Area, using gross value added in 53 NUTS 1 regions for a period of 30 years (1975–2005), detrended by Hodrick–Prescott and the Christiano–Fitzgerald filters. We conclude that, on average, synchronization has increased for the period considered with exceptions during the eighties and the beginning of the nineties. Still, the correlation of the business cycle in some regions with the benchmark remained low or even decreased. Our findings also support the hypothesis of the existence of a ‘national border’ effect. [ABSTRACT FROM AUTHOR]

In this paper we argue that in contrast to the conclusion of Artis and Zhang, there is not much evidence in support of the view that increased exchange rate stability is related to more synchronised business cycles in Europe. This finding may have important consequences, as existing differences in business cycles in the EMU-countries may not disappear due to further monetary integration, making a common monetary policy hazardous. [ABSTRACT FROM AUTHOR]

This article proposes classical business cycle turning points for the G7 and a number of European countries based on industrial production. This enables us to examine the international nature of cyclical movements free from arbitrary assumptions about the trend. In particular, we show that cyclical asymmetry is common, with slopes during declines being generally larger in magnitude than during expansions. A binary measure of association for expansion and contraction regimes indicates a core group of European countries related to each other and apparently linked to the United States and Japan through Germany. [ABSTRACT FROM AUTHOR]

We examine the co-movement patterns of European business cycles during the period 1986-2011, with an obvious focal point the year 1999 that marked the introduction of the common currency, the euro. The empirical analysis is performed within the context of Graph Theory where we apply a rolling window approach in order to dynamically analyze the evolution of the network that corresponds to the GDP growth rate cross-correlations of 22 European economies. The main innovation of our study is that the analysis is performed by introducing what we call the threshold-minimum dominating set (T-MDS). We provide evidence at the network level and analyze its structure and evolution by the metrics of total network edges, network density, isolated nodes and the cardinality of the T-MDS set. Next, focusing on the country level, we analyze each individual country's neighborhood set (economies with similar growth patterns) in the pre- and post-euro era in order to assess the degree of convergence to the rest of the economies in the network. Our empirical results indicate that despite a few economies' idiosyncratic behavior, the business cycles of the European countries display an overall increased degree of synchronization and thus convergence in the single currency era. [ABSTRACT FROM AUTHOR]

During an economic downturn the non-productive sectors (education, health, and social services) are the most exposed to sudden policy changes, as a result of austerity measures. This article aims to assess the impact of the late 2000's crisis on some European countries' healthcare systems in order to highlight the link between the breakdown of the economic context and the negative outcomes on a social level. In this regard, a panel data analysis was employed, focusing on out-of-pocket health expenses as an estimation of a nation's wellbeing and healthcare development level. The cross-time results indicated a clear collapse of all national healthcare systems in 2009 while the cross-section effects implied that the twenty three countries could be divided in three groups according to their healthcare policy, especially regarding health insurance. Thus, countries should pay more attention to the private insurances component of the healthcare systems as the others are defenseless against business cycle fluctuations. [ABSTRACT FROM AUTHOR]

By using a unique dataset on managerial-level employees who were transferred from Japan to European branches of the same global firms, we examine what would happen to work hours when a worker moves from a long-hour-working country to relatively shorter-hour countries. Even after controlling for business cycles, unobserved individual heterogeneity, job characteristics, and work hour regulations, we find a significant decline in Japanese work hours after their transfer to Europe, resulting from working-behavior influences of locally hired staff. We also find that the reduction in hours worked highly depends on the extent of the workers' interactions with local peers. [ABSTRACT FROM AUTHOR]

The innovation process in the biopharmaceutical sector is influenced by long business cycles, multiple stakeholders and complex interactions. Early models of the innovation process are inadequate to capture the complexity of innovation in the life sciences sector. In particular, narrow classifications which describe innovations as "radical" or "incremental" are not particularly useful when considered in the context of the complex patterns of interrelated innovations observed in practice. Many partial models of the innovation process which equate innovation to inventive research, patenting and product development fail to recognise that innovation is a cyclical and business-driven process and underscore the final phase of the innovation process, namely, achieving timely market diffusion and adoption of innovations to benefit patients and innovators. Innovation is sustained if it is appropriately rewarded. Investment in the science base alone without appropriate reward system for innovations is unlikely to promote renewed competitiveness in the European biopharmaceutical industry. [ABSTRACT FROM AUTHOR]

Do trade-transmitted international business cycles affect the timing of national elections? This article shows that export expansions do not differ substantively from booms in aggregate output in inviting opportunistic governments to call elections, especially as their terms mature. Further analysis confirms two ancillary implications of this relationship: (a) that clusters of countries tend to hold elections in periods of international economic expansion and (b) that national election cycles, much like business cycles, have become more correlated over time, most prominently in Europe. The findings in this article raise implications for continued economic integration: freer movement of goods, services and capital may imply more correlated business cycles and, by extension, election cycles. [ABSTRACT FROM AUTHOR]

This article presents a new business cycle index that allows for cycle-to-cycle comparisons of the depth of recessions within a country, cross-country comparisons of business cycle correlation, and simple aggregation to arrive at a measure of a European business cycle. The data augmentation implied by Gibbs sampling generates posterior distributions for a latent coincident business cycle index. Subsample corre- lations between an aggregated "Europe" index and the national business cycle indices from France, Germany, and Italy are consistent with the claim that the European economies are becoming more harmonized. [ABSTRACT FROM AUTHOR]

A barrier option is one of the most popular exotic options which is designedto give a protection against unexpected wild fluctuation of stock prices.Protection is given to both the writer and holder of such an option.Kunitomo and Ikeda (1992) analytically obtained a pricing formula forexponential double barrier knockout options. Since the logarithm of theirproposed barriers for the stock price process S( t), whichisassumed to be geometric Brownian motion, are nothing but straight lineboundaries, the protection provided by them is not uniform over time. Toremedy this problem, we propose square root curved boundaries± b√ tfor the underlying Brownian motion process W( t). Since thestandarddeviation of Brownian motion is proportional to √ t, theseboundaries(after transformation) can be made to provide more uniform protectionthroughout the life time of the option. We will apply asymptoticexpansions of certain conditional probabilities obtained by Morimoto (1999)to approximate pricing formulae for exponential square root double barrierknockout European call options. These formulae allow us to computenumerical values in a very short time ( t < 10sec), whereas it takesmuch longer to perform Monte Carlo simulations to determine optionpremiums. [ABSTRACT FROM AUTHOR]

The article focuses on the economic factors as against regular justification of national culture for institutional growth of Asia in 1970s and 1980s. The cultural explanations have been challenged by those who criticize the way standard economic factors have been ignored. Asian growth, it is suggested, can be explained quite simply in terms of purely economic factors, that is, according to the neoclassical production function, increased inputs of labor and capital, when combined with advanced technology transferred through multinational firms, will lead to much higher levels of output. However, the concept of "purely economic" factors is questionable. Asian factory workers were far better disciplined in the 1970s than their Western counterparts, and this obviously stimulated productivity growth. From a policy perspective the ways in which the national business systems of Asian countries differ from their Western counterparts are, the predominant type of firm; the strength of high trust network type relationships among firms, and the sources and nature of authority within organizations.

The crisis of stagflation, which has affected the world capitalist economy for the last 15 years continue unabated. Unemployment in Europe remains above ten percent and shows no signs of improvement. The Third World debt crisis continues to worsen, threatening the solvency of the international banking system. And the October 1987 stock market crash once again raised the specter of a worldwide capitalist depression. The summer 1988 edition of the periodical “International Journal of Political Economy” contains four articles by prominent European leftwing economists, which present a fundamentally different perspective on the current crisis, viewing it not as a unique event but as the most recent manifestation of a historical pattern of recurring economic crises.

The article examines the history of European economic growth during the period 1450-1750. According to the new school of development history, the critical period when different parts of the world set off along contrasting paths of economic growth occurred between 1450 and 1750, three centuries which witnessed the emergence and consolidation of European world economy based upon the capitalist mode of production. The evolution of trade and commerce under this old international economic order created conditions for development and underdevelopment in the nineteenth and twentieth centuries. A striking feature of the new history of development is the absence of systematic statistical underpinning for several of its basic hypotheses. An important omission is its failure to measure the economic significance of intercontinental trade. External trade formed only a small share of economic activity. Around 1780-1790 when something like 4 percent of Europe's gross national output was exported across national frontiers, perhaps less than 1 percent would have been sold to Africa, Asia, Latin America, the Caribbean and the southern plantations of the young U.S.

This article compares the levels and associated factors of the industrial revolution in England and France in the eighteenth century, based on recent literature on economic history of these countries. Some of the major issues that are emphasized here are that why did the industrial revolution occurred in the eighteenth century and why England was comparatively advanced than any other country in the revolution. The underlying view of industrialization adopted here is that economic development in general and technological progress in particular in eighteenth-century Europe should, suggestively, be regarded as stochastic processes. According to the author industrial revolution will be understood as a period of accelerated structural change in the economy, involving a rapid rise in industrial output, in the share of manufacturing in national product, and in factory-based activity, based on major technological innovations. There are two important problems which can, suggestively, be perceived in the current attempts to explain England's primacy: the danger of perpetrating post hoc ergo proper hoc fallacies and the failure to assess the relative magnitudes of the impacts of the putative causal factors.

The article examines the economic origins of fascism. The complete military defeat of fascist Europe has postponed a just historical interpretation of fascism for twenty years. Italian fascism, even in the immediate aftermath of 1945, continued to be occasionally seen for what it was, a distinct system of economic and political government, either revolutionary or, at the very least, with revolutionary potential. The liberal interpretation of fascism into which the Western world relapsed after 1945 was a pleasantly undemanding one. Such an interpretation was able to flourish because it was planted only in the topsoil of diplomatic history. The only rival to the Western liberal interpretation of fascism until recently has been the orthodox Marxist interpretation. This had the immense advantage of not neglecting economic history and consequently came much nearer to a true appreciation of the nature of fascist society. The idea that fascism is the last stage of monopoly capitalism developed in the 1920's and has not subsequently been seriously modified.

This article presents updates on studies about labor policy, as of July 1979. Lloyd Ulman and Robert Flanagan of the Brookings Institution are conducting a study on National Incomes Policies in Industrial Countries in the 1970s, which compares policies adopted to restrain movements in wages and prices in various countries. Neil W. Chamberlain of Columbia University is analyzing the processes governments, corporations and labor unions in Western Europe respond to major economic and political problems. George Seltzer of the University of Minnesota is examining the interplay between foreign trade and job security, and the adaptive responses by the collective bargaining and political processes.