2003


610. Demand Uncertainty, Mismatch and (Un)Employment

Mohamed Jellal, Jacques-Françis Thisse and Yves Zenou

A finite number of heterogeneous firms facing demand-induced price fluctuations imperfectly compete for heterogeneous workers. Because firms must commit to wages and employment before the realization of product price, they exhibit a risk-averse behavior.…


609. Ethnic Diversity, Market Structure and Risk Sharing in Agrarian Societies

Mohamed Jellal and Yves Zenou

We consider a population of heterogenous laborers and landlords who belong to different ethnic groups so that working together implies a cost (because of language and cultural differences). Part of the production is random (because for example of climate…


608. Privatization Policy in an International Oligopoly

Pehr-Johan Norbäck and Lars Persson

This paper studies privatization policy in an international oligopoly. The argument that equal treatment of foreign investors will be detrimental to domestic welfare by shifting profits from domestic to foreign firms is shown to be less relevant in…


607. Search Activities, Cost of Living and Local Labor Markets

Eleonora Patacchini and Yves Zenou

A model is considered in which optimal search intensity is a result of a trade off between short run losses due to higher search costs (more interviews, commuting...) and long-run gains due to a higher chance of finding a job. We show that this optimal…


606. Efficiency Wages, Urban Unemployment and Housing Consumption

Yves Zenou

The aim of this paper is to introduce endogenous housing consumption in an efficiency wage model in which two cases are considered: very high and zero relocation costs. First, in both cases, we are able to totally characterize the efficiency wage for any…


605. Privatization and Restructuring in Concentrated Markets

Pehr-Johan Norbäck and Lars Persson

This paper examines the restructuring of state assets in markets deregulated by privatizations and investment liberalizations. We show that the government has a stronger incentive to restructure than the buyer: A firm restructuring only takes into account…


604. Endogenous Asset Ownership Structures in Deregulated Markets

Pehr-Johan Norbäck and Lars Persson

This paper determines the equilibrium ownership structure in an emerging market deregulated by privatization and investment liberalization. It is shown that bidding competition in the privatization stage is necessary but not sufficient for reaching an…


603. Do Oppositional Identities Reduce Employment for Ethnic Minorities?

Harminder Battu, McDonald Mwale and Yves Zenou

We develop a model in which non-white individuals are defined with respect to their social environment (family, friends, neighbors) and their attachments to their culture of origin (religion, language), and in which jobs are mainly found through social…


602. Racial Beliefs, Location and the Causes of Crime

Thierry Verdier and Yves Zenou

This paper provides a unified explanation for why blacks commit more crime, are located in poorer neighborhoods and receive lower wages than whites. If everybody believes that blacks are more criminal than whites – even if there is no basis for this –…


601. Social Networks and Crime Decisions: The Role of Social Structure in Facilitating Delinquent Behavior

Antoni Calvó-Armengol and Yves Zenou

We develop a model in which delinquents compete with each other in criminal activities but may benefit from being friends with other criminals by learning and acquiring proper know-how on the crime business. By taking the social network connecting agents…


600. Organized Crime, Curruption and Punishment

Maurice Kugler, Thierry Verdier and Yves Zenou

We analyze an oligopoly model in which differentiated criminal organizations globally compete on criminal activities and engage in local corruption to avoid punishment. When law enforcers are sufficiently well-paid, difficult to bribe and corruption…


599. Bottled Water – A Case of Pointless Trade?

Richard Friberg and Mattias Ganslandt

Two-way trade in (almost) homogenous products has ambiguous welfare effects if entry is restricted. We examine Swedish imports of bottled water to investigate whether transport cost losses from trade outweigh the partial equilibrium gains from trade…


598. The Firm as a Pool of Factor Complementarities

Assar Lindbeck and Dennis J. Snower

This paper presents a new approach to the theory of the firm by identifying factor complementarities as central to the determination of the firm's boundaries. The factor complementarities may take a variety of forms: technological and informational…


597. Recruitment to Sheltered Employment:Evidence from Samhall, a Swedish State-Owned Company

Per Skedinger and Barbro Widerstedt

This paper analyses recruitment practices to Samhall, a state-owned company that provides sheltered employment for individuals with severe work disabilities. Besides providing employment for disabled workers and rehabilitating them to employment outside…


596. Voter Turnout in Direct Democracy: Theory and Evidence

Morten Søberg and Thomas P. Tangerås

We analyse voter turnout as a function of referendum types. An advisory referendum produces advice that a legislature may or may not take into account when choosing between two alternatives, whereas a binding referendum generates a decisive decision. In…


595. An Essay on Welfare State Dynamics

Assar Lindbeck

The expansion of welfare-state arrangements is seen as the result of dynamic interaction between market behaviour and political behaviour, often with considerable time lags, sometimes generating either virtuous or vicious circles. Such interaction may…


594. Who Wants Political Integration? Evidence from the Swedish EU-Membership Referendum

Jonas Vlachos

The regional voting pattern of the Swedish EU-membership referendum is analyzed to determine voters' preferences over two fiscal regimes: an autonomous Sweden, or Sweden as part of the EU. A major difference between these regimes is that autonomy gives…


593. The Swedish Model of Corporate Ownership and Control in Transition

Magnus Henrekson and Ulf Jakobsson

We analyze the development of the Swedish ownership model after World War II. The controlling ownership in Swedish firms is typically concentrated to one or two owners. Often, but not always, the controlling owners are Swedish families. Thus, the model…


592. Employer-Sponsored Training in Stabilisation and Growth Policy Perspectives

Christina Håkanson, Satu Johanson and Erik Mellander

In Europe, accounting standards prevent larger expenditures on employer-sponsored training from being treated as investments. Using Sweden as example, we discuss two consequences for training. First, the timing: training will be conducted when income is…


591. Car Age, Taxation, Scrappage Premiums and the ELV Directive

F. Mikael Sandström

A "chain of replacement" model is used to examine the effects of automobile taxes and of a scrappage premium on the life length of cars, and on the size of the car fleet. The predictions of the model are tested on data on the scrappage of cars in Sweden…


590. Reconciling the Evidence on the Knowledge Capital Model

Henrik Braconier; Pehr-Johan Norbäck and Dieter Urban

The Knowledge Capital Model (KC-model), described in Markusen (2002), encompasses both market size (horizontal) as well as factor endowment (vertical) explanations to why multinational production occurs. Although the KC-model seems intuitively appealing,…


589. Ethnic Diversity and Civil War

Thomas P. Tangerås and Nils-Petter Lagerlöf

We construct a model in which a number of equally powerful ethnic groups compete for power by engaging in civil war. In non-redistributive equilibrium, ethnically homogeneous and ethnically diverse countries face a lower probability of civil war than…


588. Bubbles and Experience: An Experiment on Speculation

Martin Dufwenberg, Tobias Lindqvist and Evan Moore

We investigate experimentally how the share of experienced traders in double-auction asset markets affects trading, in particular the occurrence of bubble-crash pricing patterns. In each session, six subjects trade in three successive market rounds and…


587. Improving the Performance of the European Social Model – The Welfare State over the Life Cycle

Assar Lindbeck

The achievements of social-welfare arrangements in Western Europe are well known: considerable income security, relatively little poverty and, in some countries, ample supply of social services. But there are also well-known weaknesses and hence…

Institutet för Näringslivsforskning, Grevgatan 34 - 2 tr, Box 55665, SE-102 15 Stockholm, Sweden | Tel: +46-(0)8-665 45 00 | info@ifn.se