Externalities, markets, and government policy

Before the work of Ronald Coase, economists argued that externalities-unpriced benefits or costs-constituted the main exception to the rule that Adam Smith's invisible hand will efficiently allocate resources. Coase showed that externalities may or may not require a government solution, depending on the institutional setting of the problems and the size of transaction costs. Moreover, even in the absence of externalities, market transactions require low transaction costs. Firms exist to economize on those costs. In shifting the terms of the debate, Coase single-handedly moved economics from presuming specific roles for government action to a more neutral position requiring detailed analysis. In this article, Roy Ruffin explains Coase's contribution to understanding the role of government.Expenditures, Public

The nature and significance of intra-industry trade

In this article, Roy Ruffin gives an overview of intra-industry trade for the generalist. Intra-industry trade represents international trade within industries rather than between industries. Such trade is more beneficial than inter-industry trade because it stimulates innovation and exploits economies of scale. Moreover, since productive factors do not switch from one industry to another, but only within industries, intra-industry trade is less disruptive than inter-industry trade.Trade ; Industries

The Globalization of American Philanthropy

This paper analyses the globalization of American philanthropy in order to uncover significant trends in cross-border flows of financial and other assistance between the U.S. and other countries and to suggest ways in which such assistance might be larger and more helpful in the future

Endogenous growth and international trade

International trade

Protectionism and Increasing Returns with Comparative-Cost Disadvantage

We reconsider the economics of protection with an industry subject to increasing returns. Under strong comparative disadvantage in one country, any tariff-distorted equilibrium in which both countries produce the commodity must be unstable.In general, under strong comparative disadvantage, the case for free trade is greater than without increasing returns. Also, exceptionally high tariffs are required to protect a high cost increasing-returns industry. Beneficial tariffs or subsidies for the country with comparative disadvantage become prominent when the country with a comparative advantage faces a relevant capacity constraint.increasing returns, protection, comparative-cost disadvantage, flexible capacity

Trade and Wages: A Deeper Investigation

A new presentation of the specific factors model shows how labor fares under international trade by considering how the price elasticity of the nominal wage rate responds to the terms of trade as well as factor endowments. Gains to labor are decomposed into measurable terms of trade effects and production bias effects. If trade is caused by differences in technology, trade can harm the interests of labor when the elasticities of substitution are sufficiently small. If trade is caused by differences in labor endowments, trade raises real wages in the labor abundant country, even if exports are capital intensive.trade, real wages, beta function, specific factors

Chronic immune activation and lymphocyte apoptosis during HIV-1 infection

HIV-1 infected individuals are subject to a chronic immune activation resulting from HIV-1 replication, microbial translocation, and lymphopenia. Despite the great advance of antiretroviral treatment (ART), the immune activation remains associated with poor immune reconstitution during HIV-1 infection. The overall aim of this PhD thesis is to contribute to a better understanding of the causes and consequences of immune activation, possibly leading to the design of improved therapy for HIV-1 infected individuals. Premature senescence of T cells, as a consequence of immune activation, is thought to be associated with the increased levels of CD28- T cells during HIV-1 infection. In Paper I, the phenotype and functional properties of CD28- T cells from HIV-1 individuals naïve to treatment, under ART and uninfected controls were assessed. Despite displaying similar markers of senescence, and late differentiation, we found that whereas CD28- T cells from untreated patients are highly susceptible to both spontaneous and activation-induced apoptosis, the same T cell population from ART-treated patients showed an enhanced capacity to proliferate upon weak TCR stimulation. Importantly, apoptosis of CD28- T cells from untreated patients was correlated with HIV-1 viral load, and their decreased ability to proliferate was associated with a reduced IL-2 production. High levels of CD28- T cells during HIV-1 infection might result from the chronic immune activation, whereas their sustained levels despite ART, is likely to arise from their capacity to proliferate under weak TCR signaling. Furthermore, with a capacity to produce IFN-, TNF and perforin, CD28- T cells from HIV-1 infected individuals might also contribute to the immune activation. The mechanisms underlying the loss of memory B cells and the decline of serological memory during HIV-1 infection remain elusive. As microbial translocation and the associated immune activation have been shown to correlate with T cell depletion, we evaluated, in Paper II, the association between the serum levels of soluble CD14, a marker of microbial translocation, with the loss of resting memory B cells in HIV-1 infected individuals. Soluble CD14 levels were found to correlate with both the decline of resting memory B cells, and their increased expression of IL-21R. IL-21R expression on memory B cells was increased during HIV-1 infection, and also negatively correlated with the levels of circulating memory B cells. Notably, IL-21R positive memory B cells were more prone to apoptosis, measured by higher Annexin V staining and lower Bcl-2 expression, as compared to B cells lacking the receptor. Furthermore, TLR triggering by microbial products resulted in IL-21R expression on memory B cells in vitro. Our results identify a novel role for microbial translocation and the associated immune activation, contributing to the loss of memory B cells during HIV-1 infection. Lymphopenic conditions are associated with increased IL-7. This cytokine involved in T cell homeostasis, is also found to be elevated in HIV-1 infected individuals concomitantly with low CD4+ T cell counts; although the regulation of IL-7 production is not fully understood in the context of HIV-1 infection. Using human intestinal epithelial (DLD-1) and bone marrow stromal (HS-27) cell lines, we investigated in Paper III, the consequence of pro-inflammatory cytokines on IL-7 production, measured at the mRNA and the protein levels. Whereas IFN- induced high IL-7 production in both cell lines, IL-1 treatment led to the opposite effect. We also analyzed the gene expression profiles of HS-27 cells treated with IL-1 and/or IFN- using the whole-genome microarray Human Gene 1.0 ST. Both cytokines resulted in enhanced expression of genes implicated in T cell immunity, particularly important during HIV-1 pathogenesis. Our results show that the immune activation can lead to profound change in stromal and epithelial cells, which in turn might shape immune responses. While IL-7 is known to participate to T cell homeostasis, it has recently been shown that this cytokine possibly contribute to B cell defects, leading through IFN-release by T cells, to Fas up-regulation and sensitivity to Fas-mediated apoptosis. We further evaluated IL-7 regulation of T cell survival in Paper IV, and observed that B cells, co-cultured with IL-7 treated T cells, proliferated, displayed a phenotype of differentiated cells and secreted high levels of immunoglobulins (Igs). The Ig secretion was demonstrated to be a consequence of CD70 up-regulation on T cell upon IL-7 treatment. IL-7 led also to BAFF production by T cells, which enhanced B cell survival. In the context of HIV-1 infection, such mechanisms might be implicated in the B cell activation and hypergammaglobulinemia observed in patients