How an Export Boom affects Unemployment

Does trade affect the equilibrium rate of unemployment? To theoretically examine this question, we incorporate firm-union bargaining considerations into a model with a booming external sector and a stagnating manufacturing sector. In the model, a sustained improvement in the terms of trade lowers unemployment. To empirically investigate the predicted determinants of the unemployment rate, we use data for Australia, a country whose prosperity has always depended on the value of its exports. We find strong evidence that higher export prices, capital accumulation in tradeable goods industries and a lower unemployment benefit replacement rate each reduce the equilibrium unemployment rate.

The Rise (and Fall) of Labour Market Programmes: The Role of Global and Domestic Factors

We study the political economy of labour market policies. First, it is shown that tax and redistributive considerations lead inside workers to prefer spending on active labour market programmes to passive spending, e.g., on unemployment benefits. We also show that greater active spending may be a feature of globalising economies. In the empirical work, panel data for OECD countries are used to examine the relationship between active and passive labour market spending, various measures of globalisation and controls relevant for analysing the political economy of labour market policies. Overall, we find that factors other than globalisation are more important determinants of labour market expenditures.

The Inverse Domino Effect: Are Economic Reforms Contagious?

This paper examines whether a country’s economic reforms are affected by reforms adopted by other countries. A simple model of economic reforms is developed to motivate the econometric work. Unsurprisingly, the model predicts that reforms are more likely when factors of production are internationally mobile and reforms are pursued in other economies. More interesting is the finding that reforms are not driven by greater trade openness. Using the change in the Index of Economic Freedom as the measure of market-liberalising reforms, we examine two issues. First, we examine whether economic reforms are ‘habit-forming’, and secondly, we identify the most important channels through which reforms are transmitted from country to country. For a panel of 144 countries and the years 1995-2006, we find little evidence that reforms are habit- forming, if anything there is a status quo bias. However, we do find evidence of the importance of reforms in other countries. Consistent with our model, international trade is not a vehicle for the diffusion of economic reforms, rather the most important mechanism is geographical or cultural proximity.Economic reforms; economic freedom; resource flow models; spatial interdependence

Executive Pay in Japan: The Role of Bank-Appointed Monitors and the Main Bank Relationship

The tournament model has the feature that executive compensation depends on the wages paid to workers at lower levels of the corporate hierarchy. The agency model shows that compensation based on firm performance is a means by which incentives can be provided to executives once a promotion tournament has been resolved. In this paper, we combine aspects of both models and show that the existence of an outsider who monitors the firm's activities will lower the sensitivity of pay to firm performance for top executives and reduce the importance of tournament-based incentives. Using panel data for 56 Japanese electronics firms, we find support for the notion that bank-appointed Board members help monitor top executives and that tournament considerations are a particularly important feature of executive compensation in Japan.Executive pay, tournaments, agency, monitoring, main bank relationship

Globalisation, the global village and the civil society

Human dynamics, institutional change, political relations and the global environment have become increasingly intertwined. The development of multicultural societies has certainly not been without its problems. The re-emergence of extremist political parties, the segregation of cultures and ethnic conflict, illustrate the problematic side of socio-cultural integration at the local level. We argue that socio-cultural factors not only change as a result of globalisation, but also can be causes, as well as challenges to the process of globalisation itself. We describe how the recent introduction of the MGI and KOF globalisation indices can be used to empirically address to what extent globalisation affects social phenomena. Overall, while the rigidity of national boarders slackens, to speak about a global community is misleading. National borders still exist and the nation-state still matters. The fact is that they have to co-exist with civil society. The institutions of global civil society place limits upon the government and function as a sort of check on various forms of government, especially the authoritarian and absolutist varieties

HSD3B1 genotype identifies glucocorticoid responsiveness in severe asthma

Asthma resistance to glucocorticoid treatment is a major health problem with unclear etiology. Glucocorticoids inhibit adrenal androgen production. However, androgens have potential benefits in asthma. HSD3B1 encodes for 3β-hydroxysteroid dehydrogenase-1 (3β-HSD1), which catalyzes peripheral conversion from adrenal dehydroepiandrosterone (DHEA) to potent androgens and has a germline missense-encoding polymorphism. The adrenal restrictive HSD3B1(1245A) allele limits conversion, whereas the adrenal permissive HSD3B1(1245C) allele increases DHEA metabolism to potent androgens. In the Severe Asthma Research Program (SARP) III cohort, we determined the association between DHEA-sulfate and percentage predicted forced expiratory volume in 1 s (FEV1PP). HSD3B1(1245) genotypes were assessed, and association between adrenal restrictive and adrenal permissive alleles and FEV1PP in patients with (GC) and without (noGC) daily oral glucocorticoid treatment was determined (n = 318). Validation was performed in a second cohort (SARP I&II; n = 184). DHEA-sulfate is associated with FEV1PP and is suppressed with GC treatment. GC patients homozygous for the adrenal restrictive genotype have lower FEV1PP compared with noGC patients (54.3% vs. 75.1%; P < 0.001). In patients with the homozygous adrenal permissive genotype, there was no FEV1PP difference in GC vs. noGC patients (73.4% vs. 78.9%; P = 0.39). Results were independently confirmed: FEV1PP for homozygous adrenal restrictive genotype in GC vs. noGC is 49.8 vs. 63.4 (P < 0.001), and for homozygous adrenal permissive genotype, it is 66.7 vs. 67.7 (P = 0.92). The adrenal restrictive HSD3B1(1245) genotype is associated with GC resistance. This effect appears to be driven by GC suppression of 3β-HSD1 substrate. Our results suggest opportunities for prediction of GC resistance and pharmacologic intervention

Regional Environmental Breadth Predicts Geographic Range and Longevity in Fossil Marine Genera

Geographic range is a good indicator of extinction susceptibility in fossil marine species and higher taxa. The widely-recognized positive correlation between geographic range and taxonomic duration is typically attributed to either accumulating geographic range with age or an extinction buffering effect, whereby cosmopolitan taxa persist longer because they are reintroduced by dispersal from remote source populations after local extinction. The former hypothesis predicts that all taxa within a region should have equal probabilities of extinction regardless of global distributions while the latter predicts that cosmopolitan genera will have greater survivorship within a region than endemics within the same region. Here we test the assumption that all taxa within a region have equal likelihoods of extinction.We use North American and European occurrences of marine genera from the Paleobiology Database and the areal extent of marine sedimentary cover in North America to show that endemic and cosmopolitan fossil marine genera have significantly different range-duration relationships and that broad geographic range and longevity are both predicted by regional environmental breadth. Specifically, genera that occur outside of the focal region are significantly longer lived and have larger geographic ranges and environmental breadths within the focal region than do their endemic counterparts, even after controlling for differences in sampling intensity. Analyses of the number of paleoenvironmental zones occupied by endemic and cosmopolitan genera suggest that the number of paleoenvironmental zones occupied is a key factor of geographic range that promotes genus survivorship.Wide environmental tolerances within a single region predict both broad geographic range and increased longevity in marine genera over evolutionary time. This result provides a specific driving mechanism for the spatial and temporal distributions of marine genera at regional and global scales and is consistent with the niche-breadth hypothesis operating on macroevolutionary timescales