Constant market shares analysis: uses, limitations and prospects

In this paper, we generalise the constant market shares (CMS) framework, with particular attention to the underlying theoretical conditions required for diagnostic interpretation. The approach is applied to the analysis of the export performance of the Australian processed food sector in South-East Asia over the period 1980–2003. We conclude that the usefulness of CMS analysis for evaluating a country’s international trade performance depends upon the empirical validity of the aggregation assumptions implicit in the diagnostic interpretation.aggregation, Armington model, competitiveness, constant market shares, Marketing,

Corruption and economic growth in Lebanon

This paper seeks to examine the impact of corruption on economic growth in Lebanon. Using a neoclassical model, we hypothesise that corruption reduces the country's standard of living as measured by real per capita GDP. We show that corruption deters growth indirectly through reducing the factor input productivity in a Cobb-Douglas production function. We provide empirical evidence suggesting that corruption increases inefficiencies in government expenditure and reduces investment and human capital productivity, leading to a negative impact on output. The implications of the analysis are explored.corruption, economic growth, investment, human capital, government expenditure, foreign aid, Institutional and Behavioral Economics, Labor and Human Capital, Public Economics,

Modelling Corruption in a Cobb-Douglas Production Function Framework

In this paper, we extend the Solow growth model to include corruption as a determinant of the multifactor productivity using a Cobb-Douglas production function framework. In addition to the classical components of any growth model (output, labor, capital), we incorporate corruption as a determinant of government expenditure, investment and foreign aid. It is proposed that output and growth are influenced by the level of corruption. This model is to be tested empirically to trace the corruptive behaviour in Lebanon based on the available time series data.Corruption, economic growth, investment, government expenditure, foreign aid, International Development,

Are Australian wholesale vegetable markets LOOPy?

Literature regarding the pricing efficiency of Australian wholesale vegetable markets is very limited. The objective of this paper is to test whether or not vegetable products traded in these markets are priced efficiently and satisfy the law of one price (LOOP). To that end, the price relationships between Adelaide and Melbourne markets are tested, using the Johansen cointegration approach, Granger causality and impulse response functions. The empirical findings do not appear to satisfy the LOOP. Policy implications of the analysis are explored.law of one price, Australian wholesale vegetable markets, pricing efficiency, Demand and Price Analysis, Marketing,

Climate change and Australia’s comparative advantage in broadacre agriculture

Australia has long been a major exporter of the products of broadacre agriculture, a production system well suited to the economic and climatic conditions of the country. According to the conventional wisdom, Australia holds a comparative advantage in these products, among which wheat and livestock products predominate. However, the future validity of this proposition is sensitive to the projected impacts of climate change. This paper develops a framework with which to quantify the future patterns of comparative advantage in broadacre agriculture given the projections of several global climate models. We find empirical support for the conventional wisdom, and note substantial resilience in Australia’s comparative advantage to adverse yield change.Comparative advantage, climate change, broadacre agriculture, Agricultural and Food Policy, Environmental Economics and Policy, Land Economics/Use, Livestock Production/Industries,

Uncertainty aversion in Australian regulation of agricultural gene technology

There is potential for over-provision of environmental harms and under-provision of environmental benefits associated with GM crops. As a result, strong public regulation is needed to ensure that full social values are considered. However, one reason for opposition to GM crops is a lack of public trust in regulatory institutions and science, and the limited opportunities afforded to public-participation and nonscientific concerns. We aim to demonstrate the trade-off between social cost and managing the risks of gene flow arising from environmental release of GM canola in Australia, using the framework of a probabilistic risk assessment and safety-rule decision mechanism.safety-rule, uncertainty, biotechnology regulation, canola, Crop Production/Industries, Institutional and Behavioral Economics, Research and Development/Tech Change/Emerging Technologies, Risk and Uncertainty,