Economics Books
Princeton University Press Scale Heterogeneity and the Structure and
Book SynopsisUnderstanding and predicting species diversity in ecological communities is one of the great challenges in community ecology. This book presents a fresh theory of coexistence that incorporates two important aspects of biodiversity in nature-scale and spatial variation in the supply of limiting resources.Trade Review"I found the book to be a fascinating read with many exciting opportunities arising from the apparently simple introduction of heterogeneity in resource distribution. I was somewhat amazed at the sphere of influence of the book, with optimal selection of food resources, species-area interactions and optimal reserve size all considered, for example... I believe that [the book] would be worth the challenge for experienced researchers looking for a new direction in the synthesis of community ecology theory."--Rebecca E. Lester, Austral EcologyTable of ContentsAcknowledgments vii Chapter 1: Community Ecology Lives 1 Chapter 2: The Geometry of Heterogeneity 15 Chapter 3: Scaling Relationships for the Consumption of Resources 32 Chapter 4: Food, Resources, and Scale-Dependent Niches 56 Chapter 5: Size Structure in Ecological Guilds 84 Chapter 6: Heterogeneity and Patterns of Species Diversity 122 Chapter 7: Biodiversity Conservation in Fractal Landscapes 148 Chapter 8: Testing the Model 170 Chapter 9: Perspectives, Caveats, and Conclusions 179 Appendix-Summary of Model Parameters 203 References 207 Index 227
£45.00
Princeton University Press Technological Innovation and Economic Performance
Book SynopsisInformation technology accounts for over one-third of recent U.S. GDP growth and nearly two-thirds of corporate capital investment. ''''The New Economy'''' appears omnipresent, but little is actually known about its workings.This seminal volume brings together the research and critical thinking of many of the world''s top macro and micro economists to provide a unique, multifaceted perspective. Through the use of detailed, up-to-date country and industry studies, this book provides the most authoritative and detailed analysis ever assembled into the causes of technological innovation and its relationship to economic performance. The country studies cover the United States, Japan, Germany, France, the United Kingdom, and the Nordic states. Nine industry studies examine the Internet, computers and semiconductors, banking, securities trading, venture capital, energy, agricultural biotechnology, pharmaceutical biotechnology, and automobiles.Commissioned and brought togetTable of ContentsContributors vii Preface ix Acknowledgement xi PART I: INTRODUCTION 1 1. Introduction and Overview by Benn Steil, David G. Victor, and Richard R. Nelson 3 2. Innovation in an Historical Perspective: Tales of Technology and Evolution by Joel Mokyr 23 PART II: COUNTRY STUDIES 47 3. The United States by Robert J. Gordon 49 4. Japan by Adam S. Posen 74 5. Germany by Horst Siebert and Michael Stolpe 112 6. France by Patrick A. Messerlin 148 7. The United Kingdom by Stephen Nickell and John Van Reenen 178 8. The Nordic Countries by Matti VireAn and Markku Malkamaki 200 PART III: INDUSTRY STUDIES 227 9. The Internet by David C. Mowery and Timothy Simcoe 229 10. Computers and Semiconductors by Richard N. Langlois 265 11. Banking and Financial Intermediation by Charles W. Calomiris 285 12. Securities Trading by Ian Domowitz and Benn Steil 314 13. Venture Capital by Josh Lerner 327 14. Pharmaceutical Biotechnology by Gary P. Pisano 347 15. Agricultural Biotechnology by Robert E. Evenson 367 16. Electric Power by David G. Victor 385 17. Automobiles by Charles H. Fine and Daniel M.G. Raff 416 Bibliography 433 Author Index 454 Subject Index 459
£73.80
Princeton University Press In Search of Prosperity
Book SynopsisThe economics of growth has come a long way since it regained center stage for economists in the mid-1980s. This work is a series of country studies guided by that research. It sheds light on some of the important growth puzzles such as how did China grow so rapidly despite the absence of full-fledged private property rights.Trade Review"Any book written or edited by Dani Rodrik is likely to be interesting and thought-provoking, and often iconoclastic. This volume is no exception... [I]t is a good volume of case studies, and may serve the added benefit of making US-based development economists attach more value to country studies of the determinants of growth."--Oliver Morrissey, Journal of International DevelopmentTable of Contents*Frontmatter, pg. i*Contents, pg. v*Acknowledgments, pg. vii*List of Contributors, pg. ix*Chapter 1. Introduction: What Do We Learn from Country Narratives?, pg. 1*Chapter 2. Australian Growth: A California Perspective, pg. 23*Chapter 3. One Polity, Many Countries: Economic Growth in India, 1873-2000, pg. 53*Chapter 4. An African Success Story: Botswana, pg. 80*Chapter 5. A Toy Collection, a Socialist Star, and a Democratic Dud? Growth Theory, Vietnam, and the Philippines, pg. 123*Chapter 6. Growing Into Trouble: Indonesia After 1966, pg. 152*Chapter 7. India since Independence: An Analytic Growth Narrative, pg. 184*Chapter 8. Who Can Explain the Mauritian Miracle? Meade, Romer, Sachs, or Rodrik?, pg. 205*Chapter 9. Venezuela's Growth Implosion: A Neoclassical Story?, pg. 244*Chapter 10. History, Policy, and Performance in Two Transition Economies: Poland and Romania, pg. 271*Chapter 11. How Reform Worked in China, pg. 297*Chapter 12. Sustained Macroeconomic Reforms, Tepid Growth: A Governance Puzzle in Bolivia?, pg. 334*Chapter 13. Fiscal Federalism, Good Governance, and Economic Growth in Mexico, pg. 399*Chapter 14. The Political Economy of Growth without Development: A Case Study of Pakistan, pg. 439*Index, pg. 473
£63.75
Princeton University Press Shifting Involvements
Book SynopsisWhy does society oscillate between intense interest in public issues and almost total concentration on private goals? This work offers a social, political, and economic analysis dealing with how and why frustrations of private concerns lead to public involvement and public participation that eventually lead back to those private concerns.Trade ReviewWinner of the Talcott Parsons Prize, American Academy of Arts and Sciences "Original... Mr. Hirschman, one of our most distinguished economists, is no ordinary writer...even his offhand ruminations have always been interesting. So is this book."--Peter L. Berger, New York Times Book Review "Shifting Involvements can be read over and over again, with each reading disclosing new subtleties, so cunning is its construction and so original its standpoint."--Michael Banton, Times Literary Supplement "This interesting essay contains a wealth of ideas. There is a surprising freshness in the treatment of such a well worn topic as the relation between public and private concerns... Intellectually stimulating."--David Berry, Times Higher Education Supplement "Literate, reflective, and sophisticated... Hirschman's work ... is proof that an economist with a knowledge of and sensitivity for history will avoid the oversimplifications of economic theorists who see the world and human behavior in one dimension."--Eli Ginzberg, Journal of Economic LiteratureTable of ContentsFOREWORD ix PREFACE xv INTRODUCTION: A Private-Public Cycle? 3 Chapter 1. On Disappointment 9 The Role of Disappointment in Preference Change 9 Taking Disappointment Seriously 14 Chapter 2. Varieties of Consumer Disappointment 25 The Privileged Position of Truly Nondurable Goods 27 Consumer Durables 32 Services 39 Chapter 3. The General Hostility Toward New Wealth 46 Historical Evidence from the Eighteenth Century in England and France 46 The Manifold Case against New Goods 53 Chapter 4. From Private Concerns into the Public Arena-I 62 Exit and Voice Reactions to Consumer Disappointment 62 Explaining Changes in Life-Styles: Ideology and Second-Order Volitions 66 Chapter 5. From Private Concerns into the Public Arena-II 77 Collective Action and the Rebound Effect 77 Why Free Rides Are Spurned 82 Chapter 6. The Frustrations of Participation in Public Life-1 92 The Poverty of Our Imagination 93 Overcommitment and Addiction 96 Chapter 7. The Frustrations of Participation in Public Life-II 103 The Underinvolvement of Voting 103 A Historical Digression on the Origins of Universal Suffrage 112 Chapter 8. Privatization 121 Corruption 123 Public Virtue Debunked 125 Attractions of the Private Sphere 128 CONCLUSION 131 INDEX 135
£28.80
Princeton University Press Interest Groups and Trade Policy
Book SynopsisGene Grossman and Elhanan Helpman are widely acclaimed for their pioneering theoretical studies of how special interest groups seek to influence the policymaking process in democratic societies. This collection of eight of their articles is a companion to their monograph, "Special Interest Politics".Trade Review"These readings showcase Grossman and Helpman's contributions to our understanding of how lobbying and interest groups affect international trade policy. Many people will want to have this collection on their shelf."--Robert Feenstra, editor, Journal of International EconomicsTable of ContentsIntroduction 1 1. Special Interest Politics 2 2. Articles in this Collection 7 2.1. Part I: Methodology 7 2.2. Part II: Applications to Trade Policy 11 3 Empirical Validation 17 References 21 PART I: INSTRUMENTS OF INFLUENCE 23 1. Common Agency and Coordination: General Theory and Application to Government Policy Making (with Avinash Dixit) 25 1. Introduction 25 2. General Theory 28 2.1. Equilibrium 28 2.2. Truthful Equilibria 32 2.3. Quasi-Linear Preferences 34 3. Application to Government Policy Making 35 References 41 2. Electoral Competition and Special Interest Politics 43 1. Introduction 43 2. Related Literature 45 3. The Model 47 3.1. The Voters 47 3.2. The Parties and the Government 49 3.3. The Special Interests 50 3.4. Political Equilibrium 52 3.5. Functional Forms 54 4. Equilibrium with One Lobby 54 4.1. Contributions with Only an Influence Motive 56 4.2. When Is an Electoral Motive Operative? 59 5. Equilibrium with Several Lobbies 61 6. Summary 67 APPENDIX 69 Strict Majority Rule 69 References 71 3. Competing for Endorsements 73 1. The Literature on Political Endorsements 77 2. The Model and a Benchmark 79 3. A Neutrality Result 84 4. Effective Endorsements 85 4.1. Mechanical Endorsements 86 4.2. Strategic Endorsements 92 5. Welfare 95 6. Conclusions 98 APPENDIX 100 Statement and Proof of Proposition 4 100 Proof of Proposition 5 104 References 107 PART II: TRADE POLICY 109 4. Protection for Sale 111 1. Overview 114 2. Formal Framework 116 3. The Structure of Protection 119 4. Political Contributions 126 5. Why Lobbies May Prefer Trade Policies 132 6. Summary and Extensions 134 References 136 5. Trade Wars and Trade Talks 139 1. Introduction 139 2. Model Outline and Relation to the Literature 141 3. The Formal Model 143 4. Trade Wars 147 5. Trade Talks 157 6. Conclusions 168 References 170 6. Politics and Trade Policy 173 1. Introduction 173 2. Political Economy Approaches 175 2.1. Direct Democracy 175 2.2. Political Support Function 178 2.3. Tariff-Formation Function 180 2.4. Electoral Competition 184 2.5. Influence-Driven Contributions 186 3. Double-Edged Diplomacy 191 3.1. Trade Wars 192 3.2. Trade Talks 193 3.3. Free Trade Agreements 194 References 197 7. The Politics of Free Trade Agreements 199 1. Analytical Framework 201 1.1. Objectives of Economic and Political Agents 202 1.2. The Political Game 204 1.3. Economic Equilibria Under an FTA 205 1.4. Effects of an FTA on Economic Interests 207 2. Unilateral Stances 208 3. Equilibrium Agreements 212 4. Industry Exclusions 219 4.1. Unilateral Stances 219 4.2. Bargaining over Industry Exclusions 224 5. Conclusions 228 APPENDIX 229 Contributions to Foreign Governments 229 References 232 8. Foreign Investment with Endogenous Protection 233 1. Introduction 233 2. Basic Model 236 2.1. Consumption and Production 237 2.2. The Special Interest Group and the Government 239 2.3. Multinationals 242 3. DFI and Protection 243 3.1. Tariff Response Curves 243 3.2. Profit Differential Curves 244 3.3. Entry 244 3.4. Equilibrium DFI and Protection 246 4. Does DFI Benefit the Average Voter? 249 5. Workers Versus Capitalists 251 6. Conclusions 255 References 255 Index 257
£54.00
Princeton University Press The Architecture of Markets An Economic
Book SynopsisMarket societies have created more wealth, and more opportunities for more people, than any other system of social organization in history. Addressing the unruly dynamism that capitalism brings with it, this work argues that the basic drift of any one market and its actors, even allowing for competition, is toward stabilization.Trade ReviewWinner of the 2003 Distinguished Book Award "Until the appearance of Fligstein's new book ... no one has attempted to integrate economic sociology into a coherent, consistent, and comprehensive approach for the study of market capitalism. This book, therefore, sets a standard for other books that will follow in the coming decades. By all measures, it is an impressive book that deserves careful reading by everyone interested in the analysis of capitalist economies."--Gary G. Hamilton, American Journal of Sociology "This is an important book. It ... will undoubtedly redirect research attention and encourage new work on the rules and politics that structure market relations. This book pushes us forward and suggests a rich vein waiting to be mined."--Mitchel Y. Abolafia, Administrative Science QuarterlyTable of ContentsList of Tables xi Preface xiii 1. Bringing Sociology Back In 3 A Critique of the E isting Literature in the Sociology of Markets 6 Theoretical Questions for a Sociology of Markets 10 A Political-Cultural Approach 15 Structure of the Book 20 Nor ative Implications of the Political-Cultural Approach to the Sociology of Markets 21 PART I 25 2. Markets as Institutions 27 Market Institutions: Basic Definitions 28 State Building and Market Building 36 Power in Policy Domains and Market Institutions 42 3. The Politics of the Creation of Market Institutions 45 Political Structuring of Labor Market Institutions 53 Policy Domains and Market Regulation in Real Societies 56 Stability and Complexity 59 Implications for Research 62 Conclusion 64 4. The Theory of Fields and the Problem of Market Formation 67 Markets as Fields 67 The Goal of Action in Stable Markets 70 The Proble of Change and Stability in Markets 75 Links between Market For ation and States 86 Some Macro Implications of the Theory of Fields 89 Globalization and Market Processes 94 Conclusion 97 PART II 99 5. The Logic of Employment Systems 101 Employment Systems as Institutional Projects 103 Variations and Transfor ations in Employment Systems 107 The Dynamics of Systems of Employment Relations 108 Insights into Comparative Employment Systems 111 Research Agendas 117 Conclusion 120 6. The Dynamics of U.S. Firms and the Issue of Ownership and Control in the 1970s 123 Review of the Literature 124 Manage ent versus Owner Control 125 Bank Control 126 Market Dynamics and Manage ent Control 128 Hypotheses 130 Data and Methods 132 Results 136 Discussion and Conclusions 144 Appendix A 146 7. The Rise of the Shareholder Value Conception of the Firm and the Merger Movement in the 1980s 147 What Is to Be Explained? 150 Finance Economics 151 Manager, Owner, and Bank Control 153 The Crisis of the Finance Conception of Control and the Rise of the Shareholder Value Conception of Control 155 Hypotheses 157 Data and Methods 158 Results 162 Conclusion 166 8. Corporate Control in Capitalist Societies 170 Economic Theories and Mechanisms 172 Sociological Theories of Control 176 Comparative Cases 181 Conclusion 189 9. Globalization 191 Definitions of Globalization 193 Critique of Globalization Arguments 195 The Slow Expansion and Unevenness of Global Trade 196 Change or Continuity in the Organization of Production? 203 Does Globalization Cause Deindustrialization and Inequality? 206 Politics, Govern ents, and Financial Markets 209 Trade, Competition, Industrial Policy, and the Welfare State 213 Globalization and Neoliberalis as an American Project 220 Conclusion 221 0. Conclusions 223 Two Tales of One Industry 223 Stability and Efficiency 228 Efficiency, Stability, and Equity 231 Conclusion 236 Notes 239 Bibliography 247 Index 269
£999.99
Princeton University Press Econometrics and the Philosophy of Economics
Book SynopsisHow can a researcher with such tools learn anything about the social reality in which he or she lives? This book addresses varied topics in both classical and Bayesian econometrics, offering evidence that its answer to the fundamental question is sound. It represents an account of contemporary economic methodology.Trade Review"[A] remarkably ambitious and largely unprecedented analysis of the philosophical foundations of econometrics... Stigum has made a bold attempt to understand the enterprise of econometrics in its original formulation. It is not only a difficult book, but also a rich and provocative one. No other such work exists. It sets the standard against which any future contribution to the philosophical foundations of econometrics will be judged."--Kevin D. Hoover, Research in the History of Economic Thought & MethodologyTable of ContentsList of Figures ix List of Tables xi Preface xv Chapter 1: Introduction 1 PART I. FACTS AND FICTION IN ECONOMETRICS 31 Chapter 2: The Construction of Social Reality 33 Chapter 3: The Social Construction of Reality 52 Chapter 4: Facts and Fiction in Econometrics 71 PART II. THEORIZING IN ECONOMICS 93 Chapter 5: Theories and Models 95 Chapter 6: The Purport of an Economic Theory 117 Chapter 7: Rationality in Economics 143 Chapter 8: Topological Artifacts and Life in Large Economies 168 PART III. THEORY-DATA CONFRONTATIONS IN ECONOMICS 191 Chapter 9: Rational Animals and Sample Populations 193 Chapter 10: The Theory Universe 216 Chapter 11: The Data Universe 237 Chapter 12: The Bridge Principles 262 PART IV. DATA ANALYSES 283 Chapter 13: Frequentist Analogues of Priors and Posteriors Tore Schweder and Nils Lid Hjort 285 Chapter 14: On the COLS and CGMM Moment Estimation Methods for Frontier Production Models Harald E. Goldstein 318 Chapter 15: Congruence and Encompassing Christophe Bontemps and Grayham E. Mizon 354 Chapter 16: New Developments in Automatic General-to-Specific Modeling David F. Hendry and Hans-Martin Krolzig 379 PART V. EMPIRICAL RELEVANCE 421 Chapter 17: Conjectures, Theories, and Their Empirical Relevance 423 Chapter 18: Probability versus Capacity in Choice under Uncertainty 458 Chapter 19: Evaluation of Theories and Models Clive W. J. Granger 480 PART VI. DIAGNOSTICS AND SCIENTIFIC EXPLANATION 497 Chapter 20: Diagnoses and Defaults in Artificial Intelligence and Economics 499 Appendix: Section 20.3 from a Logical Point of View by Herman Ruge Jervell 520 Chapter 21: Explanations of an Empirical Puzzle: What Can Be Learned from a Test of the Rational Expectations Hypothesis? Heather M. Anderson 525 Chapter 22: Scientific Explanation in Economics 558 Chapter 23: Scientific Explanation in Econometrics: A Case Study Heather M. Anderson, Bernt P. Stigum, and Geir Olve Storvik 578 PART VII. CONTEMPORARY ECONOMETRIC ANALYSES 611 Chapter 24: Handling the Measurement Error Problem by Means of Panel Data: Moment Methods Applied on Firm Data Erik Biorn 613 Chapter 25: On Bayesian Structural Inference in a Simultaneous Equation Model Herman K. van Dijk 642 Chapter 26: An Econometric Analysis of Residential Electric Appliance Holdings and Consumption Jeffrey A. Dubin and Daniel L. McFadden 683 Chapter 27: Econometric Methods for Applied General Equilibrium Analysis Dale W. Jorgenson 702 Index 755
£120.60
Princeton University Press Financial Crisis Contagion and Containment
Book SynopsisOffers an account of the financial crises that rocked East Asia and other parts of the world, beginning with the collapse of the Thai baht in 1997. This book argues that East Asia's opening to the free flow of capital was pushed by advocates, official and private, in the global economy's U.S.-led developed center.Trade Review"Financial Crisis, Contagion, and Containment is though-provoking for economic and financial practitioners who want to better understand financial crises and the IMF's attendant policy responses. Although originally written in 2003, the book remains relevant today."--MKB, Financial Analysts JournalTable of Contents*Frontmatter, pg. i*Contents, pg. vii*Preface, pg. ix*1. Introduction, pg. 1*2. The U.S. Economy in Transition, pg. 13*3. The Euro: Teething Troubles and Faltering Responses, pg. 46*4. Japan: The Lost Decade of the Nineties amidst Policy Paralysis, pg. 70*5. The Asian Financial Crisis, pg. 86*6. The Asian Crisis Chronology, pg. 119*7. The Ruble Collapses in August 1998, pg. 136*8. Contagion from the Ruble to the Real, pg. 162*9. Beyond Bangkok: Crisis Erupts in Buenos Aires and in the Bosphorus, pg. 172*10. The Contagion, pg. 197*11. International Monetary Fund to the Rescue: How Did It Fare? Badly, pg. 212*12. Crisis Prevention and Containment: The Next Steps in Financial Reform, pg. 263*References, pg. 285*Index, pg. 293
£67.50
Princeton University Press Methods for Applied Macroeconomic Research
Book SynopsisBrings together dynamic equilibrium theory, data analysis, and advanced econometric and computational methods to provide a comprehensive set of techniques for use by academic economists as well as professional macroeconomists in various fields. This book starts from a class of DSGE models and describes methods needed to estimate their parameters.Trade Review"The last twenty years have witnessed a revolution in macroeconomic modeling. Yet an integrated and accessible treatment of the new methods has been notably lacking. Fabio Canova's book fills that gap magnificently. It is surely destined to be an indispensable reference for both students and researchers for years to come."—Charles Bean, Bank of England"This book will become an invaluable reference for applied macroeconomists as well as a much-needed teaching tool for graduate macroeconomic courses. Anybody who has an interest in quantitative macroeconomics, either as an academic or as a practitioner, should buy it."—Lucrezia Reichlin, European Central Bank"Dynamic general equilibrium models have become regular tools for policy analysis in central banks and other policy institutions. This book is a wonderful source for those who want to bring those models to the data. It is thorough and comprehensive, it has a great set of examples and exercises, and, above all, it provides many practical tips. A must-read for any applied macroeconomist."—Frank Smets, European Central Bank"To be able to describe and interpret business-cycle fluctuations using modern methods developed by researchers is crucial to economists who want to make and evaluate forecasts and policy advice. Fabio Canova has a long experience from research at the frontier, but also from teaching and from applied work at policy institutions such as central banks. His book provides an indispensable toolbox for any researcher that wants to have an influence on practical policy work."—Anders Vredin, Sveriges Riksbank"The material covered in this book is extensive, and the author always strives to provide an in-depth analysis and discussion for every topic, complete with the most up-to-date developments in the literature. The combination of DSGE macroeconomics and econometrics makes this book a unique product, likely to become an essential reference for empirical macroeconomists and policymakers."—Marco Del Negro, FRB Atlanta"This book is unprecedented among econometrics books for the way it incorporates careful and sophisticated macroeconomic theory. It is unprecedented among books on dynamic macroeconomics for its level of practical statistical advice and econometric sophistication. There is simply nothing close to this book available. Many of the best young researchers will want to study and teach from it."—Thomas J. Sargent, New York University"This book treats econometric, computational, and macroeconomic substantive issues jointly. Nearly all existing books in this area are either strictly econometric, strictly computational, or focus on substance without taking up econometric and computational issues. The need for a treatment like this on the part of applied researchers means there will be wide interest in it."—Christopher Sims, Princeton UniversityTable of ContentsPreface xi Chapter 1: Preliminaries 1 1.1 Stochastic Processes 2 1.2 Convergence Concepts 3 1.3 Time Series Concepts 8 1.4 Laws of Large Numbers 14 1.5 Central Limit Theorems 16 1.6 Elements of Spectral Analysis 18 Chapter 2: DSGE Models, Solutions, and Approximations 26 2.1 A Few Useful Models 27 2.2 Approximation Methods 45 Chapter 3: Extracting and Measuring Cyclical Information 70 3.1 Statistical Decompositions 72 3.2 Hybrid Decompositions 83 3.3 Economic Decompositions 100 3.4 Time Aggregation and Cycles 104 3.5 Collecting Cyclical Information 105 Chapter 4: VAR Models 111 4.1 TheWold Theorem 112 4.2 Specification 118 4.3 Moments and Parameter Estimation of a VAR.q/ 126 4.4 Reporting VAR Results 130 4.5 Identification 141 4.6 Problems 151 4.7 Validating DSGE Models with VARs 159 Chapter 5: GMM and Simulation Estimators 165 5.1 Generalized Method of Moments and Other Standard Estimators 166 5.2 IV Estimation in a Linear Model 169 5.3 GMM Estimation: An Overview 176 5.4 GMM Estimation of DSGE Models 191 5.5 Simulation Estimators 197 Chapter 6: Likelihood Methods 212 6.1 The Kalman Filter 214 6.2 The Prediction Error Decomposition of Likelihood 221 6.3 Numerical Tips 228 6.4 ML Estimation of DSGE Models 230 6.5 Two Examples 240 Chapter 7: Calibration 248 7.1 A Definition 249 7.2 The Uncontroversial Parts 250 7.3 Choosing Parameters and Stochastic Processes 252 7.4 Model Evaluation 259 7.5 The Sensitivity of the Measurement 279 7.6 Savings, Investments, and Tax Cuts: An Example 282 Chapter 8: Dynamic Macro Panels 288 8.1 From Economic Theory to Dynamic Panels 289 8.2 Panels with Homogeneous Dynamics 291 8.3 Dynamic Heterogeneity 304 8.4 To Pool or Not to Pool? 315 8.5 Is Money Superneutral? 321 Chapter 9: Introduction to Bayesian Methods 325 9.1 Preliminaries 326 9.2 Decision Theory 335 9.3 Inference 336 9.4 Hierarchical and Empirical Bayes Models 345 9.5 Posterior Simulators 353 9.6 Robustness 370 9.7 Estimating Returns to Scale in Spain 370 Chapter 10: Bayesian VARs 373 10.1 The Likelihood Function of an m-Variable VAR(q) 374 10.2 Priors for VARs 376 10.3 Structural BVARs 390 10.4 Time-Varying-Coefficient BVARs 397 10.5 Panel VAR Models 404 Chapter 11: Bayesian Time Series and DSGE Models 418 11.1 Factor Models 419 11.2 Stochastic Volatility Models 427 11.3 Markov Switching Models 433 11.4 Bayesian DSGE Models 440 Appendix A Statistical Distributions 463 References 469 Index 487
£78.20
Princeton University Press The FreeMarket Innovation Machine
Book SynopsisRejects the conventional view that capitalism benefits society through price competition - that is, products and services become less costly as firms vie for consumers. While giving price competition due credit, this book stresses that large firms use innovation as a prime competitive weapon.Trade ReviewHonorable Mention for the 2003 Award for Best Professional/Scholarly Book in Economics, Association of American Publishers "Mr. Baumol's contribution is not to emphasize the impact of innovation but to pinpoint how competition forces companies to make innovation routine... The traditional analysis ... says that capitalism blunders at generating innovation over the long run. Mr. Baumol ... reverses this presumption... [He] tells a tale rich in details about the market's use of collaboration to overcome problems of innovation. Along the way he turns standard analysis upside down."--Michael M. Weinstein, New York Times "A brilliant book... What makes capitalism uniquely successful is the built-in pressure to generate new products and processes. Provided companies are forced to compete, the market will find a way to generate and diffuse an unending stream of innovations."--Martin Wolf, Financial Times "The book could not be more timely."--David Propson, New York Law Journal "Over the past 50 years, William Baumol has made groundbreaking contributions to a wide range of economic fields, including antitrust, the study of productivity, and the nature of growth... At 80, and still going strong, he is among the last working members of the great generation of post-World War II economists."--Business Week "In this fine volume [Baumol] challenges readers to rethink entirely the conventional wisdom concerning the nature and benefits of the capitalist (or free market) system... [It is] readable, challenging, stimulating."--Choice "For managers looking for a big picture view, this is a useful account. And while it deflates the romantic view of the maverick innovative company, the book justly celebrates the positive results of this routinized 'innovation machine'--the unprecedented growth rates we've had under capitalism."--Harvard Business Review "You cannot fault Baumol for being unambitious. In this fine volume he challenges readers to rethink entirely the conventional wisdom concerning the nature and benefits of the capitalist (or free market) system... Readable, challenging, stimulating."--Choice "An important new book."--David Crane, Toronto Star "Professor Baumol is a giant in the field of economics... This book displays both his prodigious intellect and the sweep of his scholarship... [T]his is an important book."--Ashish Arora, Journal of Technology TransferTable of ContentsPreface vii CHAPTER 1: Introduction: The Engine of Free-Market Growth 1 PART I: THE CAPITALIST GROWTH MECHANISM CHAPTER 2: The "Somewhat Optimal" Attributes of Capitalist Growth: Oligopolistic Competition and Routinization of Innovation 19 CHAPTER 3: Oligopolistic Rivalry and Routinization to Reduce Uncertainty 30 CHAPTER 4: Oligopolistic Rivalry and Routine Innovation Spending: Theory of the Engine of Unprecedented Capitalist Growth 43 CHAPTER 5: Independent Innovation in History: Productive Entrepreneurship and the Rule of Law 55 CHAPTER 6: Voluntary Dissemination of Proprietary Technology: Private Profit, Social Gain 73 CHAPTER 7: Oligopolistic Rivalry and Markets for Technology Trading 93 CHAPTER 8: Tradeoff: Innovation Incentives versus Benefits to Others (Distributive Externalities) 120 PART II: INTEGRATION OF INNOVATION INTO THE MAINSTREAM OF MICROTHEORY CHAPTER 9: Oligopolistic Competition, Pricing, and Recoupment of Innovation Outlays 151 CHAPTER 10: Microeconomic Theory of Industrial Organization in the "Innovation-Machine" Economy 161 CHAPTER 11: Recouping Innovation Outlays and Pricing Its Products: Continued 183 CHAPTER 12: Models of Optimal Timing of Innovation 199 CHAPTER 13: Licensing for Profit: Efficiency Implications 215 PART III: ON THE MACRODYNAMICS OF CAPITALISM CHAPTER 14: Capitalism's Unique Innovation Machine: Historical Evidence 245 CHAPTER 15: Macroeconomic Models and Relationships That May Limit Growth 262 CHAPTER 16: Feedback: Innovation as a Self-Nourishing Process 284 Bibliography 299 Index 307
£33.25
Princeton University Press Anticipating Correlations
Book SynopsisIntroduces an important method for estimating correlations for large systems of assets: Dynamic Conditional Correlation (DCC). This title demonstrates the role of correlations in financial decision making, and addresses the economic underpinnings and theoretical properties of correlations and their relation to other measures of dependence.Trade Review"No doubt much more literature will develop in this area. Professor Engle has done a service by laying out how his mind is moving and thinking at the current time."--Peter Tompkins, The ActuaryTable of ContentsIntroduction vii Chapter 1: Correlation Economics 1 1.1 Introduction 1 1.2 How Big Are Correlations? 3 1.3 The Economics of Correlations 6 1.4 An Economic Model of Correlations 9 1.5 Additional Influences on Correlations 13 Chapter 2: Correlations in Theory 15 2.1 Conditional Correlations 15 2.2 Copulas 17 2.3 Dependence Measures 21 2.4 On the Value of Accurate Correlations 25 Chapter 3: Models for Correlation 29 3.1 The Moving Average and the Exponential Smoother 30 3.2 Vector GARCH 32 3.3 Matrix Formulations and Results for Vector GARCH 33 3.4 Constant Conditional Correlation 37 3.5 Orthogonal GARCH 37 3.6 Dynamic Conditional Correlation 39 3.7 Alternative Approaches and Expanded Data Sets 41 Chapter 4: Dynamic Conditional Correlation 43 4.1 DE-GARCHING 43 4.2 Estimating the Quasi-Correlations 45 4.3 Rescaling in DCC 48 4.4 Estimation of the DCC Model 55 Chapter 5: DCC Performance 59 5.1 Monte Carlo Performance of DCC 59 5.2 Empirical Performance 61 Chapter 6: The MacGyver Method 74 Chapter 7: Generalized DCC Models 80 7.1 Theoretical Specification 80 7.2 Estimating Correlations for Global Stock and Bond Returns 83 Chapter 8: FACTOR DCC 88 8.1 Formulation of Factor Versions of DCC 88 8.2 Estimation of Factor Models 93 Chapter 9: Anticipating Correlations 103 9.1 Forecasting 103 9.2 Long-Run Forecasting 108 9.3 Hedging Performance In-Sample 111 9.4 Out-of-Sample Hedging 112 9.5 Forecasting Risk in the Summer of 2007 117 Chapter 10: Credit Risk and Correlations 122 Chapter 11: Econometric Analysis of the DCC Model 130 11.1 Variance Targeting 130 11.2 Correlation Targeting 131 11.3 Asymptotic Distribution of DCC 134 Chapter 12: Conclusions 137 References 141 Index 151
£54.00
Princeton University Press The Future of Money
Book SynopsisIs globalization leading us toward a world of fewer and fewer currencies and, consequently, simplified monetary management? This book argues that this view is wrong. It demonstrates that the global population of currencies is set to expand greatly, not contract, making monetary governance more difficult, not less.Trade Review"An informative discussion of various currency arrangements, from exclusive reliance on a national currency to bimonetarism to the adoption of foreign currency as official legal tender, touching on both academic and practical arguments for each."--Richard N. Cooper, Foreign Affairs "Cohen has produced yet another excellent volume on the political economy of international monetary affairs... Like most of Cohen's scholarship, [this book] displays the author's remarkable facility with the vast breadth of issues, theories, puzzles, and esoterica associated with monetary matters, as well as a confident command of monetary policy and history."--Jonathan Kirshner, Perspectives on PoliticsTable of ContentsList of Illustrations ix Acknowledgments xi Introduction xiii Abbreviations xxi One: The Changing Geography of Money 1 Two: Four Directions 33 Appendix: Tables 62 Three: Life at the Peak 67 Four: The Art of Surviva l99 Five: Follow the Leader 123 Six: Hanging Together 153 Seven: New Frontiers 179 Eight: Governing the New Geography 203 Notes 223 References 247 Index 285
£33.25
Princeton University Press Governing the Market Economic Theory and the
Book SynopsisReviews the debate about industrial policy in East and Southeast Asia and chronicles the changing fortunes of these economies over the 1990s. This title extends the argument to explain the boom of the first half of the decade and the crash of the second, stressing the links between corporations, banks, governments, and others.Trade ReviewWinner of the 1992 Best Book Award of the Political Economy Section of the American Political Science Association "[This] study by Robert Wade is one of only a handful that describes how economic policy in East Asia has actually worked... A superb book... Governing the Market demystifies East Asia's miracle without making it seem any less remarkable. It assaults idle prejudice on every side of the debate about markets and the role of government. It is long overdue, and deserves to be widely read."--Economist "This valuable book provides a quite detailed and carefully analytical account of the economic development of Taiwan and its political and social setting... [Wade] makes a good case for his view that while market forces, at home and abroad, have been given much play, the government has also played a key part."--Foreign Affairs
£40.50
Princeton University Press Essays on the Great Depression
Book SynopsisThis is a collection of Ben Bernanke's essays on why the Great Depression was so devastating and lasted so long. The essays also show that while the it was an unparalleled disaster on a universal scale, some economies pulled up faster than others, and some made an opportunity out of a disaster.Trade Review"[H]aving devoted much of his career to studying the causes of the Great Depression, Bernanke was the academic expert on how to prevent financial crises from spinning out of control and threatening the general economy. One line from his Essays on the Great Depression sounds especially prescient today: 'To the extent that bank panics interfere with normal flows of credit, they may affect the performance of the real economy.'"--Roger Lowenstein, New York Times Magazine "Bernanke is the master of applied microeconomics. Not only is he technically proficient but his ability to place his results in a larger macroeconomic context is unparalleled."--Mark Toma, Financial History Review "Mr. Bernanke certainly knows the importance of well-functioning markets. In Essays on the Great Depression he wrote persuasively that runs on the banks and extensive defaults on loans reduced the efficiency of the financial sector, prevented it from doing its normal job in allocating resources, and contributed to the Depression severity. The Depression-era problems he studied are mirrored by similar issues today, and they need urgent attention."--Robert J. Shiller, New York Times "Fortunately, before he became entangled in these restrictions [Bernanke] did edit and help write a book, Essays on the Great Depression... Mr. Bernanke's motive was that understanding the depression would provide important clues to what can go wrong with capitalist market systems."--Samuel Brittan, Financial Times "The financial crisis has made Federal Reserve Chairman Ben Bernanke's book Essays on the Great Depression a hot seller... Bernanke, a former Princeton University economist, is considered the pre-eminent living scholar of the Great Depression. He is practicing today what he preached in his book: Flood the system with money to avoid a depression."--Dennis Cauchon, USA Today "When Ben Bernanke arrived at the Federal Reserve in February 2006 as the new chairman of the central bank, he had a copy of his 2001 book, Inflation Targeting: Lessons from the International Experience, tucked under his arm. Not literally, of course. He was hoping to convince his colleagues on the Federal Open Market Committee of the value of an explicit inflation target. Little did he know that less than two years later he'd be shelving Inflation Targeting and turning to Essays on the Great Depression, another of his books, for guidance. In his book of essays, Bernanke calls the Great Depression the 'Holy Grail of macroeconomics.' He writes that 'the experience of the 1930s continues to influence macroeconomists' beliefs, policy recommendations, and research agendas.'"--Caroline Baum, Bloomberg.com "With some observers saying that the ongoing financial crisis could be the worst since the Great Depression, the greatest living expert on that period is getting the chance to apply its economic lessons... In Essays on the Great Depression ... [Bernanke] notes that understanding that period is the 'holy grail of macroeconomics.'"--Spencer Jakab, Dow Jones NewswiresTable of ContentsPreface vii PART ONE: OVERVIEW 3 1. The Macroeconomics of the Great Depression: A Comparative Approach 5 PART TWO: MONEY AND FINANCIAL MARKETS 39 2. Nonmonetary Effects of the Financial Crisis in the Propagation of the Great Depression 41 3. The Gold Standard, Deflation, and Financial Crisis in the Great Depression: An International Comparison - With Harold James 70 4. Deflation and Monetary Contraction in the Great Depressim An Analysis by Simple Ratios - With Ilian Mihov 108 PART THREE: LABOR MARKETS 161 5. The Cyclical Behavior of Industrial Labor Markets: A Comparison of the Prewar and Postwar Eras - With James L. Powell 163 6. Employment, Hours, and Earnings in the Depression: An Analysis of Eight Manufacturing Industries 206 7. Unemployment, Inflation, and Wages in the American Depression: Are There Lessons for Europe? - With Martin Parkinson 247 8. Procyclical Labor Productivity and Competing Theories of the Business Cycle: Some Evidence from Interwar U.S. Manufacturing Industries - With Martin Parkinson 255 9. Nominal Wage Stickiness and Aggregate Supply in the Great Depression - With Kevin Carey 276 Index 303
£31.50
Princeton University Press An Introduction to Mathematical Analysis for
Book SynopsisProviding an introduction to mathematical analysis as it applies to economic theory and econometrics, this book bridges the gap that has separated the teaching of basic mathematics for economics and the increasingly advanced mathematics demanded in economics research today. Dean Corbae, Maxwell B. Stinchcombe, and Juraj Zeman equip students with the knowledge of real and functional analysis and measure theory they need to read and do research in economic and econometric theory. Unlike other mathematics textbooks for economics, An Introduction to Mathematical Analysis for Economic Theory and Econometrics takes a unified approach to understanding basic and advanced spaces through the application of the Metric Completion Theorem. This is the concept by which, for example, the real numbers complete the rational numbers and measure spaces complete fields of measurable sets. Another of the book''s unique features is its concentration on the mathematical foundations of econometrics. To illustrate difficult concepts, the authors use simple examples drawn from economic theory and econometrics. Accessible and rigorous, the book is self-contained, providing proofs of theorems and assuming only an undergraduate background in calculus and linear algebra. Begins with mathematical analysis and economic examples accessible to advanced undergraduates in order to build intuition for more complex analysis used by graduate students and researchers Takes a unified approach to understanding basic and advanced spaces of numbers through application of the Metric Completion Theorem Focuses on examples from econometrics to explain topics in measure theory Trade Review"I've struggled in teaching a math for economics course for several years without an appropriate text. This book will remedy this problem and, more generally, will fill a gap that has existed in the profession for at least a decade."—L. Joe Moffitt, University of Massachusetts"This book will prove extremely useful for anyone who wants to learn mathematical economics in an accessible and intuitive fashion, while still tackling advanced concepts. The range of topics is impressive, with many illuminating examples. An excellent text!"—Jaksa Cvitanic, California Institute of Technology"This book makes accessible an extraordinary amount of mathematics used in economics and carries it to a high level. By means of illustrative examples, the authors succeed in explaining most of the main ideas of economic theory. This is an important resource for economists and an excellent text for mathematics courses for economic graduate students."—Truman F. Bewley, Yale University"A much-needed textbook for graduate students and a useful desk reference for researchers, this book is of tremendous value to the economics profession because it bridges abstract mathematics and concrete economic applications. Given the current technical level required in research, knowledge of materials covered in this book is indispensable for graduate students."—Han Hong, Stanford University"Without ever sacrificing rigor, the authors have a style that will help students trying to decipher arcane mathematical ideas. I recommend this book to students."—Richard P. McLean, Rutgers University
£80.00
Princeton University Press Auctions
Book SynopsisOffers a non-technical introduction to auction theory, and emphasises its practical application. This book discusses the successes and failures of the one-hundred-billion dollar "third-generation" mobile-phone license auctions. It also demonstrates the power of auction theory to explain unconnected issues.Trade Review"As a leader in auction-theory research and as a leading practitioner of auction design, Paul Klemperer is the best person to write the definitive book on auctions in theory and practice. This book ties together material on what economists should learn from auction theory, and on what auction theorists should learn from practical experience in auction design." - Roger B. Myerson, University of Chicago; "Paul Klemperer is one of the leaders in auction design worldwide. His emphasis in recent years on some of the more practical aspects of the theory - how to attract bidders, how to avoid collusion, how to think about government policy goals in designing public auctions - is particularly innovative. Klemperer's work will be very influential in the coming years." - Jeremy Myorson, Stanford University"Table of ContentsPREFACE ix INTRODUCTION 1 Part A: Introduction to the Theory 1: A SURVEY OF AUCTION THEORY 9 1.1 INTRODUCTION 9 1.1.1 Plan of this chapter 10 1.1.2 The standard auction types 11 1.1.3 The basic models of auctions 12 1.1.4 Bidding in the standard auctions 13 1.1.5 Terminology 14 1.2 EARLY LITERATURE 15 1.3 INTRODUCTION TO THE RECENT LITERATURE 16 1.4 THE BASIC ANALYSIS OF OPTIMAL AUCTIONS, REVENUE EQUIVALENCE, AND MARGINAL REVENUES 16 1.5 RISK-AVERSION 19 1.6 CORRELATION AND AFFILIATION 20 1.7 ASYMMETRIES 21 1.7.1 Private value differences 22 1.7.2 Almost-common-values 23 1.7.3 Information advantages 24 1.8 ENTRY COSTS AND THE NUMBER OF BIDDERS 25 1.8.1 Endogenous entry of bidders 25 1.8.2 The value of additional bidders 27 1.8.3 Information aggregation with large numbers of bidders 27 1.8.4 Unknown number of bidders 28 1.9 COLLUSION 28 1.10 MULTI-UNIT AUCTIONS 29 1.10.1 Optimal auctions 29 1.10.2 Simultaneous auctions 30 1.10.3 Sequential auctions 31 1.10.4 Efficient auctions 33 1.11 ROYALTIES, INCENTIVES CONTRACTS, AND PAYMENTS FOR QUALITY 34 1.12 DOUBLE AUCTIONS, ETC. 35 1.12.1 Double auctions 35 1.12.2 Related two-sided trading mechanisms 36 1.13 OTHER TOPICS 36 1.13.1 Budget constraints 37 1.13.2 Externalities between bidders 37 1.13.3 Jump bidding 38 1.13.4 The war of attrition 38 1.13.5 Competing auctioneers 39 1.14 TESTING THE THEORY 39 1.15 CONCLUSION 39 APPENDIX 1.A: THE REVENUE EQUIVALENCE THEOREM 40 1.B: MARGINAL REVENUES 44 1.C: AFFILIATED SIGNALS 48 1.D: EXAMPLES USING THE UNIFORM DISTRIBUTION 51 1.E: BIBLIOGRAPHY 57 AFTERWORD 62 EXERCISES 66 Part B: Applications to Other Areas of Economics 2: WHY EVERY ECONOMIST SHOULD LEARN SOME AUCTION THEORY 75 2.1 INTRODUCTION 76 2.2 USING AUCTION-THEORETIC TOOLS IN ECONOMICS: THE REVENUE EQUIVALENCE THEOREM 77 2.2.1 Comparing litigation systems 78 2.2.2 The war of attrition 79 2.2.3 Queuing and other "all-pay" applications 81 2.2.4 Solving for equilibrium behavior: market crashes and trading "frenzies" 81 2.3 TRANSLATING LOOSER ANALOGIES FROM AUCTIONS INTO ECONOMICS: ASCENDING VS. (FIRST-PRICE) SEALED-BID AUCTIONS 84 2.3.1 Internet sales vs. dealer sales 84 2.3.2 Anglo-Dutch auctions, a theory of rationing, and patent races 88 2.4 EXPLOITING DEEPER CONNECTIONS BETWEEN AUCTIONS AND ECONOMICS: MARGINAL REVENUES 89 2.5 APPLYING AUCTION THEORY TO PRICE-SETTING OLIGOPOLIES 92 2.5.1 Marginal-cost pricing is NOT the unique Bertrand equilibrium 92 2.5.2 The value of new consumers 93 2.5.3 Information aggregation in perfect competition 95 2.6 APPLYING AUCTION THEORY (AND ECONOMICS) TO AUCTION MARKETS 95 2.6.1 Important auction markets 96 2.6.2 Applying economics to auction design 97 2.7 CONCLUSION 98 APPENDIX 2.A: COMPARING LITIGATION SYSTEMS 99 2.B: DIRECT PROOF OF MONOPOLY-THEORETIC VERSION OF PROPOSITION IN SECTION 2.4 100 Part C: Practical Auction Design 3: WHAT REALLY MATTERS IN AUCTION DESIGN 103 3.1 INTRODUCTION 103 3.2 COLLUSION 104 3.3 ENTRY DETERRENCE AND PREDATION 106 3.4 OTHER PITFALLS 109 3.4.1 Reserve prices 109 3.4.2 Political problems 109 3.4.3 Loopholes 110 3.4.4 Credibility of the rules 111 3.4.5 Market structure 112 3.4.6 When is auction design less important? 113 3.5 SOLUTIONS 113 3.5.1 Making the ascending auction more robust 113 3.5.2 Using sealed-bid auctions 114 3.5.3 The Anglo-Dutch auction 116 3.5.4 Antitrust 117 3.6 TAILORING AUCTION DESIGN TO THE CONTEXT 119 3.7 CONCLUSION 121 4: USING AND ABUSING AUCTION THEORY 123 4.1 INTRODUCTION 123 4.2 THE RECEIVED AUCTION THEORY 126 4.2.1 Relevance of the received theory 127 4.3 THE ELEMENTARY ECONOMIC THEORY THAT MATTERS 131 4.3.1 Entry 131 4.3.2 Collusion 135 4.4 ROBUSTNESS TO POLITICAL PRESSURES 138 4.4.1 Economic similarity-political similarity 139 4.5 UNDERSTANDING THE WIDER CONTEXT 143 4.6 USING ECONOMIC THEORY 145 4.6.1 Do e-commerce and m-commerce raise consumer prices? 145 4.7 CONCLUSION 147 Part D: Case Study: The "3G" Mobile-Phone Auctions 5: OVERVIEW OF THE EUROPEAN AUCTIONS 151 5.1 INTRODUCTION 151 5.2 WHAT REALLY MATTERS IN AUCTION DESIGN? 152 5.3 THE YEAR 2000 SIMPLE ASCENDING AUCTIONS: THE UNITED KINGDOM, NETHERLANDS, ITALY, AND SWITZERLAND 153 5.3.1 The UK auction (March-April 2000) 153 5.3.2 The Netherlands auction (July 2000) 155 5.3.3 The Italian auction (October 2000) 156 5.3.4 The Swiss auction (November/December 2000) 157 5.4 THE YEAR 2000 "VARIABLE-PRIZE" ASCENDING AUCTIONS: GERMANY AND AUSTRIA 158 5.4.1 The German auction (July-August 2000) 158 5.4.2 The Austrian auction (November 2000) 160 5.5 BIDDERS' VALUATIONS OF LICENSES 161 5.6 THE YEAR 2001 AUCTIONS 162 5.6.1 The Belgian and Greek auctions (March and July 2001) 162 5.6.2 The Danish auction (September 2001) 163 5.7 HOW DID THE SEQUENCING MATTER? 164 5.7.1 Learning to play the game 164 5.7.2 Learning opponents' valuations 164 5.7.3 Complementarities 166 5.7.4 Budget constraints 166 5.8 CONCLUSION 166 6: DESIGNING THE UK AUCTION 168 6.1 BACKGROUND 169 6.2 AUCTIONS VS. BEAUTY CONTESTS 170 6.2.1 Arguments for auctions 170 6.2.2 Popular objections to auctions 171 6.3 AIMS OF THE AUCTION 174 6.4 MAIN ISSUES 175 6.4.1 The problem of entry 175 6.4.2 Royalties or lump sum payments? 176 6.4.3 How many licenses? 177 6.4.4 Legal issues 178 6.5 AUCTION DESIGNS 178 6.5.1 The Anglo-Dutch design 178 6.5.2 The simultaneous ascending design 181 6.6 OTHER ISSUES 183 6.6.1 Roaming 183 6.6.2 Associated bidders 184 6.6.3 The Vodafone-Mannesmann takeover 185 6.7 ASSESSMENT 186 6.7.1 The auction outcome 186 6.7.2 Mistakes 188 6.7.3 Telecom auctions elsewhere 189 6.8 CONCLUSION 191 7: BIDDER STRATEGIES 192 7.1 INTRODUCTION (TO DISCUSSION OF THE UK AUCTION) 192 7.2 EFFICIENCY OF THE UK AUCTION 192 7.3 BT'S BIDDING BEHAVIOR 193 7.4 INTRODUCTION (TO DISCUSSION OF THE GERMAN AUCTION) 196 7.5 THE GERMAN AUCTION 198 7.6 GRW'S ANALYSIS OF THE GERMAN AUCTION 199 7.7 WHAT ACTUALLY HAPPENED IN THE GERMAN AUCTION? 202 7.8 A RELATIVE PERFORMANCE MAXIMIZING THEORY OF THE GERMAN AUCTION 202 7.9 THE AUSTRIAN AND SWISS AUCTIONS 205 7.10 THE IMPORTANCE OF ENTRY, AND THE UK AUCTION 206 8: WERE AUCTIONS A GOOD IDEA? 207 SUGGESTIONS FOR COURSE OUTLINES 210 SOLUTIONS TO EXERCISES 212 REFERENCES 223 INDEX 241
£45.00
Princeton University Press A Perilous Progress Economists and Public
Book SynopsisExamines how a community of experts identified with uncritical celebration of "free market" virtues was itself shaped, dramatically so, by government and collective action. This book describes economists' fitful efforts to sway a state apparatus where values and goals could seldom remain separate from means and technique.Trade Review"Michael A. Bernstein has produced a first-rate analysis of the professionalization of social science. His book is not only a well-informed history of the American economics profession but also an insightful analysis of its relationship with government and a philippic against what Bernstein sees as the profession's recent self-prostitution."--Thomas K. McCraw, Journal of American History "Bernstein details a largely unknown and even unsuspected history of how our professional associations and journals strove from the beginning to engage the important questions, and of how they in the end lost the ability to do so."--James K. Galbraith, The Washington Monthly "This book is an impressive achievement."--William J. Barber, EH.NetTable of ContentsList of Illustrations ix A Note on the Notes xi Prologue. Being Ignored 1 Introduction. Professional Expertise as a Historical Problem 7 1. Shaping an Authoritative Community 15 2. Prospects, Puzzles, and Predicaments 40 3. The Mobilization of Resources and Vice Versa 73 4. On Behalf of the National Security State 91 5. Statecraft and Its Retainers 115 6. Statecraft and Its Discontents 148 Epilogue. Being Ignored (Reprise) 185 Notes 195 Bibliography and Reference Abbreviations 291 Acknowledgments 343 Index 347
£36.00
Princeton University Press The Demography of Corporations and Industries
Book SynopsisPresents the demographic approach to organizational studies. This book examines the theory, models, methods, and data used in corporate demographic research. It explores the processes by which corporate populations change over time, including organizational founding, growth, decline, structural transformation, and mortality.Trade Review"Destined to become the standard reference ... Caroll and Hannan admirably chronicle the first steps toward legitimizing organizational demography as a distinct specialist form."--David Knoke, American Journal of Sociology "This is one of the most scientific textbooks in the field... [It] serves as an (almost) ideal example for students and scholars alike, and it is highly relevant for nearly everybody interested in organizations, policy, management, strategy, and contingency. Students of modernity will also find much of interest."--Jeroen Bruggeman, Contemporary Sociology "The Demography of Corporations and Industries [is] ... the reference book on the subject."--Hallie J. Kintner, Population Studies "A compelling contribution that is destined to be a mandatory addition to the bookshelves of the beginner and the advanced scholar and a testament to the vigor and reach of the ecological program of research."--Hayagreeva Rao, Administrative Science QuarterlyTable of ContentsList of Figures xi List of Tables xv Preface xix Acknowledgments xxvii Part I The Case for Corporate Demography 1 1 About Organizations 3 1.1 Aging and Learning 3 1.2 Inertia and Change 5 1.3 Competitive Intensity 7 1.4 Global Competition 9 1.5 Historical Efficiency 11 1.6 Employment and Entrepreneurship 12 1.7 A Look Ahead 14 2 The Demographic Perspective 17 2.1 Demography of Business Organizations 18 2.2 Organizing Principles of Demography 25 2.3 Formal Demography and Population Studies 26 2.4 Demographic Explanation 28 2.5 The Demography of the Work Force 31 2.6 Internal Organizational Demography 32 3 Toward a Corporate Demography 35 3.1 Earlier Efforts 36 3.2 Retaining the Classical Structure 39 3.3 Making Demography Organizational 40 3.4 A Research Strategy 56 4 Forms and Populations 59 4.1 Population versus Form 60 4.2 Identity and Form 67 4.3 Codes 68 4.4 Organizational Forms 73 4.5 Organizational Populations 74 4.6 Systems of Forms 76 4.7 Implications for Corporate Demography 78 Part II Methods of Corporate Demography 83 5 Observation Plans 85 5.1 Designs in Organizational Research 86 5.2 Trade-offs in Observation Plans 89 6 Analyzing Vital Rates 101 6.1 Event-History Designs 101 6.2 Stochastic-Process Models 110 6.3 Life-Table Estimation 117 6.4 Constant-Rate Models 127 7 Modeling Corporate Vital Rates 135 7.1 Duration Dependence 135 7.2 Dependence on Covariates 139 7.3 Note on Left Truncation 149 7.4 Comparing Designs by Simulation 150 7.5 Simulation Findings 155 8 Demographic Data Sources 163 8.1 Criteria for Evaluating Sources 164 8.2 Commonly Used Sources 167 8.3 Using Multiple Sources 185 8.4 Data Realities 188 Part III Population Processes 191 9 Organizational Environments 193 9.1 Telephone Companies 194 9.2 Modeling Environments 197 9.3 Environmental Imprinting 205 9.4 Imprinting in High-Tech Firms 207 10 Density-Dependent Processes I 213 10.1 Models of Population Growth 214 10.2 Corporate Density Dependence 216 10.3 Theory of Density Dependence 222 10.4 Interpreting Density Dependence 228 10.5 Weighted Density 232 10.6 Programmatic Issues 236 11 Density-Dependent Processes II 239 11.1 Density Delay 240 11.2 Population-Age Interactions 243 11.3 Size Interactions 251 11.4 Multilevel Processes 253 12 Segregating Processes 261 12.1 Resource Partitioning 262 12.2 Research on Partitioning 269 12.3 Size-Localized Competition 272 Part IV Organizational Processes 279 13 Age-Dependent Processes 281 13.1 Models of Age Dependence 282 13.2 Age-Related Liabilities 288 13.3 Age and Growth Rates 290 13.4 Theories of Age Dependence 291 13.5 Core Assumptions 296 13.6 Liabilities of Newness and Adolescence 301 13.7 Liability of Senescence 303 13.8 Alignment, Drift and Obsolescence 306 13.9 Liability of Obsolescence 309 14 Size Dependence 313 14.1 Size and Growth Rates 315 14.2 Age, Size, and Mortality 319 14.3 Automobile Manufacturers 322 14.4 Extending the Formalization 331 15 Initial Mobilizing 339 15.1 Organizing Activities 340 15.2 Theoretical Arguments 343 15.3 Automobile Preproducers 346 16 Organizational Transformation 357 16.1 Theory and Research 358 16.2 Structural Inertia 362 16.3 Transformation and Mortality 368 16.4 Innovation in Automobile Manufacturing 374 Appendix: A Property-Based Formalization of Inertia Theory 377 Part V Selected Implications 381 17 Organization Theory 383 17.1 Equilibrium Orientation 383 17.2 Alignment and Fitness 385 17.3 Adaptation and Selection 389 17.4 Speed and Efficiency of Change 393 17.5 Historical Efficiency and Competition 397 18 Regulation 401 18.1 Early Telephony 403 18.2 Interconnection Laws 404 18.3 The Kingsbury Commitment 406 18.4 Regulation and Deregulation in Banking 411 18.5 System Dynamics after Deregulation 414 18.6 Deregulation and Organizational Growth 418 19 Employment 423 19.1 Effects on Careers 424 19.2 Corporate Demography andjob Shifts 425 19.3 Job Creation and Dissolution 426 19.4 Corporate Demography and Individual Mobility 429 19.5 Employment Benefits and Social Welfare 432 19.6 Effects of Careers on Corporate Demography 437 20 Organizational Diversity 439 20.1 Beer and Wine Industries 440 20.2 Diversity, Careers, and Inequality 444 20.3 Toward a Community Ecology of Corporations 451 References 453 Index 481
£55.25
Princeton University Press Markets from Networks Socioeconomic Models of
Book SynopsisUnveils a theory of the market economy. Arguing that most economists use overly abstract models of how the economy operates, this book seeks an empirically based alternative. It creates mathematical models of how the economy works and how the interaction of its sectors creates mutual protection from the uncertainties of business.Trade ReviewWinner of the 2004 Viviana Zelizer Distinguished Book Award in Economic Sociology, American Sociological Association "This is an original and stimulating work by an eminent sociologist who undertakes to analyze the structure and workings of economic markets."--W. J. Baumol, Journal of Economics "This is a work of remarkable scope and ambition. Harrison White is one of the leading lights of 'new economic sociology'."--Costas Lapavitsas, Enterprise & SocietyTable of ContentsList of Figures ix List of tables xi Preface xiii Acknowledgments xv 1. Introduction 1 PART ONE: FIRMS EMBED INTO A MARKET 2. Profiles for a Market 27 3. Market plane 49 4. Quality and Unraveling 78 5. Signaling and PARADOX 95 PART TWO: MARKETS COMPETE, TOO 6. Substitutability Extended 121 7. Market Space 139 8. Estimating Qualities and Parameters 158 PART THREE: MARKETS ALONG NETWORKS 9. Facing Upstream or Down 177 10. Embed and Decouple 200 11. Suppressing Market Realities 221 PART FOUR: MARKETS AND FIRMS OVER TIME 12. Investing across markets 245 13. Strategic Moves and Market Evolution 266 14. Contrasting Research Perspectives 284 15. Business Cultures 299 16. Conclusion 317 Appendix. On Computations 331 Glossary of Symbols 339 Notes 342 References 353 Index 381
£40.50
Princeton University Press Searching for a Corporate Savior The Irrational
Book SynopsisTakes us into the often secretive world of the CEO selection process. This book explains the basic mechanics of the selection process and how hiring priorities have changed with the rise of shareholder activism. It argues that the market for CEOs is culturally determined and too frequently inefficient.Trade Review"The most important--and timely--management book of 2002. Rakesh Khurana pulls back the curtain on ... the vogue for hiring celebrity outsiders over capable insiders... A thousand hosannas."--Fortune "[This] new book ... will surely intensify the already hot debate on corporate governance... [It] seems wonderfully rational, not to mention impeccably well timed... Recent events, of course, should make people care about the problems he spotlights. Some chief executives have either looted their companies or mismanaged them in ways that have wiped out billions of dollars of shareholder value."--William J. Holstein, The New York Times "CEOs often write their own tickets when they ride to the rescue of a company in distress. Khurana details the ways that CEO accountability has diminished and compensation has skyrocketed (while workers' pay, in real dollars, has gone down)."--Adam Rogers, Newsweek "As Mr. Khurana patiently explains, the rise of the charismatic C.E.O. has been, on balance, a terrible trend for American business... C.E.O.s have justified their ludicrous, pharaoh-like paydays with talk about supply and demand, meritocracy and shareholder value--but as it turns out, there's no steady correlation between any of these."--Stephen Metcalf, New York Observer "Searching for a Corporate Savior pulls back the curtain on how the system of CEO selection actually works... As a precondition to accepting the job, Khurana found, most candidates insist on taking both the chairman and C.E.O. titles as well as the right to stack the board with their cronies... [M]any of those C.E.O.s have transferred ungodly sums of money from shareholders to their own pockets."--Jerry Useem, American Prospect "Highly readable... Khurana shows that the damage caused by celebrities in the executive suites does not affect merely employees and investors but society as a whole."--Toronto Globe and Mail "Even if a company is in dire straits, is an outsider likely to be the best person to rescue it? Mr. Khurana insists that is rarely the case. As markets go, that for chief executives works in a spectacularly unsatisfactory way, he argues... The search process, with its emphasis on confidentiality, restricts the hunt for potential candidates and puts enormous power in the hands of the recruiting firm."--The Economist "A fascinating and grimly entertaining book."--Gene Epstein, Barron's "In his excellent, readable and highly original Searching for a Corporate Savior , Khurana lays bare the CEO search process and shows how directors at company after company favor executive glitz and corporate pedigree over demonstrated competence--and then grossly overpay their recruits while demanding miraculous results. Not surprisingly, in trying to live up to expectations, the bosses often end up wrecking the company."--Jay Hancock, Baltimore Sun "Rakesh Khurana takes a big swing at today's cult of the corporate leader, aiming to demolish a few of the shibboleths that company boards hold dear... All in all, this is a refreshing debunking of business mythology."--Simon Clarke, Human ResourcesTable of ContentsPreface ix 1. "Everyone Knew He Was Brilliant ":The Wooing of Jamie Dimon 1 2. A Different Kind of Market 20 3. The Rise of the Charismatic CEO 53 4. Board Games:The Role of Directors in CEO Search 81 5. The Go-Betweens:The Role of the Executive Search Firm 118 6. Crowning Napoleon:The Making of the Charismatic Candidate 151 7. Open Positions,Closed Shops:Learning from the External CEO Succession Process 186 Appendix 221 Notes 237 References 273 Index 289
£33.25
Princeton University Press Economic Modeling and Inference
Book SynopsisTakes econometrics to a fresh level by demonstrating how to combine modern economic theory with the statistical inference methods to get the most out of economic data. This title draws applications from both microeconomics and macroeconomics, paying special attention to financial and labor economics.Trade Review"Economic Modeling and Inference gives an excellent overview of dynamic modeling techniques in economics and fills an important gap among current textbooks. [It] is an excellent book, especially for graduate students in economics... [I]t is also a must for economists who need a refresher course in dynamic modeling ... [and] should also be on the bookshelf of practicing researchers interested in expanding the number of models used in their work."--Journal of the American Statistical Association "Economic Modeling and Inference offers a technically sophisticated grounding in the structural approach to analyzing data. The book does an excellent job of illustrating the wide range of questions that the empirical dynamic programming approach can tackle by explicitly bridging economic theory and econometrics... Books such as these will undoubtedly help the structural paradigm more successfully compete in the market for applied econometric methodologies."--Robert M. Sauer, Journal of Economic Literature "Overall, the book is well structured and will be useful for many different purposes, ranging from a main text for a PhD-level course to practical guidance for researchers who do empirical work based on dynamic programming models."--Dong-Hyuk Kim, Economic RecordTable of ContentsPreface xiii Chapter 1: Introduction 1 1.1 Expected Utility Theory 1 1.2 Uncertainty Aversion, Ellsberg and Allais 4 1.3 Structural Versus Reduced-Form Methods 6 1.4 Exercises 7 1.5 References 8 Chapter 2: Components of a Dynamic Programming Model 9 2.1 Examples 9 2.2 Data Configurations 13 2.3 The Objective Function 16 2.4 The State Variables 17 2.5 The Control Variables 18 2.6 The Transition Distribution 19 2.7 The Curse of Dimensionality 21 2.8 The Curse of Degeneracy 22 2.9 Exercises 24 2.10 References 25 Chapter 3: Discrete States and Controls 26 3.1 Solving DP Problems: Finite Horizon 26 3.2 Solving DP Problems: Infinite Horizon 30 3.2.1 The Method of Successive Approximation 32 3.2.2 The Method of Policy Iteration 34 3.3 Identification: A Preview 35 3.4 Exercises 37 3.5 References 37 Chapter 4: Likelihood Functions for Discrete State/Control Models 38 4.1 Likelihood with Complete Observability 38 4.2 Measurement Error 45 4.3 Imperfect Control 51 4.4 Conclusions 54 4.5 Exercises 55 4.6 References 55 Chapter 5: Random Utility Models 57 5.1 Introduction 57 5.2 The Value Function 59 5.3 A Binary Utility Shock 60 5.4 A Continuously Distributed Utility Shock 62 5.5 Choice Probabilities 65 5.6 Dynamic Continuous Random Utility 66 5.7 Exercises 69 5.8 References 70 Chapter 6: Continuous States, Discrete Controls 71 6.1 Introduction 71 6.2 Transition Distributions and Utility 73 6.3 The Value Function and Backward Recursion 74 6.4 Example: Exercising an American Option 76 6.5 Infinite Horizon: Contraction and Forward Recursion 79 6.6 Example: Optimal Stopping in Discrete Time 83 6.7 Exercises 85 6.8 References 85 Chapter 7: Econometric Framework for the Search Model 87 7.1 The Search Model 87 7.2 Likelihood: General Considerations 89 7.3 Likelihood: Specifics for Wage Data 94 7.3.1 Wage Data Alone--One Parameter 96 7.3.2 Wage Data--Two Parameters 97 7.3.3 Wage Data Alone--Offer Arrival Probability 99 7.4 Likelihood: Wage and Duration Data 100 7.4.1 Wage and Duration Data--Two Parameters 100 7.4.2 Wage and Duration Data--Three Parameters 102 7.4.3 Wage and Duration Data--Gamma Distribution 104 7.5 Exercises 107 7.6 References 108 Chapter 8: Exact Distribution Theory for the Job Search Model 109 8.1 Introduction 109 8.2 The Prototypal Search Model 110 8.3 Alternative Economic Parametrizations 115 8.4 Models for Joint Wage and Duration Data 122 8.5 Conclusion 127 8.6 Exercises 128 8.7 References 128 Chapter 9: Measurement Error in the Prototypal Job Search Model 129 9.1 Introduction 129 9.2 The Prototypal Search Model 130 9.3 The Prototypal Model with Measurement Errors 132 9.4 Characterizing the Distribution of Measurement Errors 134 9.5 Estimation in the Prototypal Model with Measurement Errors 136 9.6 Application to the SIPP Data Set 139 9.7 Conclusions 146 9.8 Exercises 146 9.9 References 147 Chapter 10: Asset Markets 148 10.1 Introduction 148 10.2 General Asset Pricing 148 10.3 The Term Structure of Interest Rates 150 10.4 Forward Contracts 154 10.5 Futures Contracts 156 10.6 Introduction to Options 160 10.7 The Binomial Method 162 10.8 Empirical Applications 166 10.8.1 Time Series Properties 167 10.8.2 Portfolio Models 174 10.8.3 Time-Varying Volatility 181 10.8.4 Term Structure Analysis 184 10.9 Exercises 191 10.10 References 191 Chapter 11: Financial Options 192 11.1 Introduction 192 11.2 Financial Option Exercise and Job Search 192 11.3 Multiple Finite-Horizon Options 194 11.4 Markov Stock Prices 196 11.5 Value Functions for American Options 199 11.6 Option Price Data 205 11.7 Testing Option Market Efficiency 208 11.8 Exercises 212 11.9 References 212 Chapter 12: Retirement 213 12.1 Introduction 213 12.2 A Simple Retirement Model 213 12.3 The Likelihood Function 216 12.4 Longitudinal Data 221 12.5 Regularizing the Likelihood 224 12.6 Generalizations 232 12.7 Alternative Models 236 12.8 Application: The Joint Retirement of Married Couples 240 12.9 Exercises 242 12.10 References 243 Chapter 13: Continuous States and Controls 244 13.1 Introduction 244 13.2 The Linear-Quadratic Model: Finite Horizon 245 13.2.1 An Application: Macroeconomic Control 247 13.2.2 Rational Expectations 248 13.3 The Linear-Quadratic Model: Infinite Horizon 249 13.3.1 Application: Macro Policy with Rational Expectations 250 13.4 Estimation of Linear-Quadratic Models 251 13.4.1 The Curse of Degeneracy 251 13.4.2 Sources of Noise 251 13.4.3 Measurement Error 253 13.4.4 Imperfect Control 253 13.4.5 Random Utility 254 13.5 The General (Non-LQ) Case 256 13.6 Smoothness: Euler Equations 260 13.7 Discussion and Examples 261 13.8 Random Utility in the General Case 264 13.9 Exercises 264 13.10 References 265 Chapter 14: Continuous-Time Models 266 14.1 Introduction 266 14.2 Optimal Stopping in Continuous Time 269 14.3 A Jump Process Application: Allocation of Time over Time 270 14.4 Dynamic Consumption and Portfolio Choice 274 14.5 Application: Changing Investment Opportunities 278 14.6 Derivatives, Hedging, and Arbitrage Pricing 281 14.7 Stochastic Volatility and Jumps 289 14.8 The Term Structure of Interest Rates in Continuous Time 298 14.9 Exercises 310 14.10 References 310 Chapter 15: Microeconomic Applications 312 15.1 Introduction 312 15.2 Bus Engine Replacement 313 15.3 Aircraft Engine Maintenance 314 15.4 Medical Treatment and Absenteeism 316 15.5 Nuclear Power Plant Operation 317 15.6 Fertility and Child Mortality 319 15.7 Costs of Price Adjustment 320 15.8 Schooling, Work, and Occupational Choice 322 15.9 Renewal of Patents 323 15.10 Marketing--Direct Mailing of Catalogs 324 15.11 Scrapping Subsidies and Automobile Purchases 326 15.12 On-the-Job Search and the Wage Distribution 327 15.13 Exercises 329 15.14 References 330 Chapter 16: Macroeconomic Applications 331 16.1 Consumption as a Random Walk 331 16.2 Consumption and Asset Returns 333 16.3 Dynamic Labor Demand 334 16.4 Time Inconsistency of Optimal Plans 336 16.5 Time to Build 338 16.6 Nonseparable Utility 339 16.7 Preferences of Monetary Authorities 341 16.8 Dynamic Labor Supply 342 16.9 Effects of U.S. Farm Subsidies 345 16.10 Exercises 346 16.11 References 346 Chapter 17: Finance Application: Futures Hedging 347 17.1 Hedging Strategies 347 17.2 Self-Financing Trading Strategies 350 17.3 Estimation 353 17.4 Exercises 359 17.5 References 359 Chapter 18: Intertemporal Asset Pricing 360 18.1 Introduction 360 18.2 Prices and Returns 361 18.3 Capital Asset Pricing Model 362 18.4 Estimation 363 18.5 A Structural Model 365 18.6 Asset Pricing Puzzles 369 18.7 Exercises 376 18.8 References 376 Chapter 19: Dynamic Equilibrium: The Search Model 377 19.1 Introduction 377 19.2 Homogeneous Equilibrium Search 378 19.3 Data Distribution and Likelihood 383 19.4 Panels with Partially Missing Observations 389 19.4.1 The Contribution of Unemployment Duration 390 19.4.2 The Contribution of Wages 390 19.4.3 The Contribution of Employment Duration 392 19.4.4 A Numerical Example 394 19.5 Geometric Information Decomposition 395 19.5.1 Destination State Information 400 19.6 Data and Summary Statistics 403 19.7 Empirical Results 406 19.8 Conclusion 414 19.9 Exercises 415 19.10 References 415 Chapter 20: Dynamic Equilibrium: Search Equilibrium Extensions 416 20.1 Introduction 416 20.2 Measurement Error in Wages 416 20.3 Heterogeneity in Productivity: The Discrete Case 420 20.4 Heterogeneity in Productivity: The Continuous Case 424 20.5 Conclusion 429 20.6 Exercises 429 20.7 References 429 Appendix: Brief Review of Statistical Theory 431 A.1 Introduction 431 A.2 Exponential Families 432 A.3 Maximum Likelihood 434 A.4 Classical Theory of Testing 437 References 441 Index 469
£63.00
Princeton University Press The Handbook of Economic Sociology
Book SynopsisCopublished in 1994 by Princeton University Press and the Russell Sage Foundation as a synthesis of the burgeoning field of economic sociology. This resource focuses on what continues to be one of the leading edges of sociology and one of its most important interdisciplinary adventures. It is for faculty, graduate students, and undergraduates.Trade ReviewFrom review of Princeton's original edition: "This beautifully produced compendium is an invaluable reference work: Its broad compass, indices by author and subject, and copious bibliographic notes alone will keep it within an arm's reach at the desks of social scientists for years to come."--Samuel Bowles, Contemporary Sociology From review of Princeton's original edition: "This excellent volume is a compilation of some of the best writing in this field over the past decade, including basic works like Oliver Williamson's transaction cost theory of the firm, and [is] a helpful comparison of economic sociology to mainstream economics."--Francis Fukuyama, Foreign Affairs From review of Princeton's original edition: "A unique and invaluable survey of this rapidly developing field of scholarship."--Choice "The 31 articles which make up the Handbook are, without exception, of superb quality, expressing scholarship at its best... The book's range of topics, authoritative articles, and summary of past accomplishments and contemporary research certainly will serve for many years as the crystallizing nucleus of the reincarnated field of economic sociology."--Journal of Institutional and Theoretical Economics "[O]ne difference between economists and sociologists is in the questions asked. For example, if jobs were relatively homogenous, the economist would ... only be concerned about the total number and the wage level. The sociologist might well be interested in the non-economic explanation of who goes to which job. But ... it is clear that the social aspects can affect outcomes that even the economist is interested in. Anyone wishing to study these important matters will have to start with The Handbook of Economic Sociology."--Times Literary Supplement "[T]here is a great deal of interesting research and theoretical reflection going on under the rubric of economic sociology, and the Handbook is certainly the best available guide to this."--Review of International Political Economy "[This book] confirms the impression that economic sociology is rapidly becoming a powerful force in academic life... It can be strongly recommended for the intrinsic interest of its subject matter and for the individual merit of most of its contributions... Mainstream economists now have some serious competition to face."--Journal of Economic HistoryTable of ContentsPreface vii Acknowledgments xi PART I: GENERAL CONCERNS Chapter 1. Introducing Economic Sociology by Neil J. Smelser and Richard Swedberg 3 Chapter 2. Comparative and Historical Approaches to Economic Sociology by Frank Dobbin 26 Chapter 3. The New Institutionalisms in Economics and Sociology by Victor Nee 49 Chapter 4. Principles of an Economic Anthropology by Pierre Bourdieu 75 Chapter 5. Behavioral Economics by Roberto Weber and Robyn Dawes 90 Chapter 6. Emotions and the Economy by Mabel Berezin 109 PART II: THE ECONOMIC CORE: ECONOMIC SYSTEMS, INSTITUTIONS, AND BEHAVIOR Section A: The Economy in a Macrosociological Perpective Chapter 7. The Economic Sociology of the Ancient Mediterranean World by Ian Morris and J. G. Manning 131 Chapter 8. The Global Economy: Organization, Governance, and Development by Gary Geref 160 Chapter 9. The Political and Economic Sociology of International Economic Arrangements by Neil Fligstein 183 Chapter 10. Post-Communist Economic Systems by Lawrence P. King and Ivan Szelenyi 205 Section B: The Sociology of Economic Institutions and Economic Behavior Chapter 11. Markets in Society by Richard Swedberg 233 Chapter 12. The Sociology of Labor Markets and Trade Unions by Wolfgang Streeck 254 Chapter 13. Banking and Financial Markets by Linda Brewster Stearns and Mark S. Mizruchi 284 Chapter 14. Sociology of Work and Occupations by Andrew Abbott 307 Chapter 15. Culture and Consumption by Viviana Zelizer 331 Chapter 16. The Sociology of Money and Credit by Bruce G. Carruthers 355 Chapter 17. Networks and Economic Life by Laurel Smith-Doerr and Walter W. Powell 379 Chapter 18. The Informal Economy by Alejandro Portes and William Haller 403 Section C: The Sociology of Firms, Organizations, and Industries Chapter 19. Business Groups and Social Organization by Mark Granovetter 429 Chapter 20. Entrepreneurship by Howard E. Aldrich 451 Chapter 21. Firms and Environments by Gerald F. Davis 478 PART III: INTERSECTIONS OF THE ECONOMY Chapter 22. The State and the Economy by Fred Block and Peter Evans 505 Chapter 23. A Sociological Approach to Law and the Economy by Lauren B. Edelman and Robin Stryker 527 Chapter 24. Welfare States and the Economy Evelyne by Huber and John D. Stephens 552 Chapter 25. Education and the Economy by Mary C. Brinton 575 Chapter 26. New Directions in the Study of Religion and Economic Life by Robert Wuthnow 603 Chapter 27. Gender and Economic Sociology by Paula England and Nancy Folbre 627 Chapter 28. The Ethnic Economy by Ivan Light 650 Chapter 29. Technology and the Economy by Giovanni Dosi, Luigi Orsenigo, and Mauro Sylos Labini 678 Chapter 30. The Economy and the Environment by Allan Schnaiberg 703 Contributors 727 Index 729
£73.80
Princeton University Press The Exchange Rate in a Behavioral Finance
Book SynopsisOffers an alternative view of the workings of foreign exchange markets. This title explains why large exchange-rate changes and volatility clustering occur. It analyzes the effects of official interventions in the foreign exchange market. It is suitable for analysts in foreign exchange markets and students of international finance and economics.Trade Review"DeGrauwe and Grimaldi have written a most stimulating book with many interesting ideas for students and researchers of modern economics and finance, economic policy makers as well as financial practitioners... It is a well balanced mixture of finance intuition, model simulations as well as rigorous analysis, described in a lucid way and illustrated by many clarifying figures."--Cars Hommes, International Review of Economics and FinanceTable of ContentsPreface ix Chapter 1: The Need for a New Paradigm 1 1.1 The Rational Representative Agent Paradigm 1 1.2 Cracks in the REEM Construction 2 1.3 Behavioral Finance: A Quick Survey 8 1.4 The Broad Outlines of an Alternative Approach 10 1.5 Appendix: The Asian Disease Problem 12 Chapter 2: A Simple Behavioral Finance Model of the Exchange Rate 13 2.1 Introduction 13 2.2 The Model 14 2.3 Stochastic Simulation of the Model 19 2.4 The Steady State of the Model 25 2.5 Numerical Analysis of the Deterministic Model 27 2.6 Sensitivity Analysis of the Deterministic Model 30 2.7 Basins of Attraction 32 2.8 The Stochastic Model: Sensitivity to Initial Conditions 34 2.9 Why "Crashes" Occur 35 2.10 The Role of Memory 39 2.11 Is Chartism Evolutionarily Stable? 43 2.12 Conclusion 45 2.13 Appendix: Numerical Values of the Parameters Used in the Base Simulation 47 2.14 Appendix: Simulations of the Base Model with Different Stochastic Realizations 48 Chapter 3: A Slightly More Complex Behavioral Finance Model 49 3.1 Introduction 49 3.2 The Model 49 3.3 Stochastic Simulation of the Model 54 3.4 Solution of the Deterministic Model 54 3.5 Informational Issues 60 3.6 Some Preliminary Remarks on Empirical Predictions of the Model 63 3.7 Rational and Behavioral Bubbles 64 3.8 Conclusion 67 3.9 Appendix: The Variance Ratio ?2 f,t /? 2 c,t in the Steady State 68 3.10 Appendix: Numerical Values of the Parameters Used in the Base Simulation 69 Chapter 4: Limits to Arbitrage 71 4.1 Introduction 71 4.2 Risk Aversion and Limits to Arbitrage 71 4.3 Transaction Costs and Limits to Arbitrage 75 4.4 Conclusion 86 Chapter 5: Changes in the Perception of Risk 87 5.1 Introduction 87 5.2 Risk Perception and Misalignment 87 5.3 Risk Perception and Losses: Prospect Theory 90 5.4 Changing Risk Perception and Transaction Costs 95 5.5 Conclusion 100 Chapter 6: Modeling the Supply of Foreign Assets and the Current Account 103 6.1 Introduction 103 6.2 Stochastic Simulations of the Model 104 6.3 Deterministic Analysis of the Model 105 6.4 Sensitivity to Initial Conditions and Informational Issues 109 6.5 Profitability of Chartist and Fundamentalist Rules 111 6.6 Conclusion 111 6.7 Appendix: The Steady State of the Model 113 6.8 Appendix: Transitional Dynamics 114 Chapter 7: Risk Appetite in an Evolutionary Perspective 117 7.1 Introduction 117 7.2 The Extended Model 117 7.3 The Nature of Risk Appetite 121 7.4 Sensitivity to Initial Conditions 121 7.5 Sensitivity Analysis 122 7.6 The Effect of News 123 7.7 Conclusion 127 Chapter 8: The Empirical Evidence 129 8.1 Introduction 129 8.2 The Distribution of Returns: A Tale of Fat Tails and Excess Kurtosis 129 8.3 Dependence Properties of Returns 133 8.4 The Disconnect Puzzle 139 8.5 Transaction Costs: Do They Matter? 141 8.6 Asymmetry of Bubbles and Crashes 144 8.7 Is Chartism Evolutionarily Stable? 145 8.8 Conclusion 147 8.9 Appendix: Hill Index and Kurtosis in Prospect Model 149 8.10 Appendix: Some More Results on Volatility Clustering 150 8.11 Appendix: Additional Results for the EC Model 151 Chapter 9: Official Interventions in the Foreign Exchange Markets 153 9.1 Introduction 153 9.2 Modeling Official Interventions in the Foreign Exchange Market 154 9.3 Rule-Based Interventions in the Foreign Exchange Market 159 9.4 Target Intervention 162 9.5 Is Intervention Sustainable? 163 9.6 Conclusion 164 Chapter 10: Chaos in the Foreign Exchange Markets 167 10.1 Introduction 167 10.2 What Is Chaos? 167 10.3 Conditions for Chaos to Occur 169 10.4 Foreign Exchange Market Intervention and Chaos 175 10.5 Target Intervention 177 10.6 Empirical Relevance of Chaotic Dynamics 178 10.7 Conclusion 180 10.8 Appendix: Sensitivity to Parameter Values 181 10.9 Appendix: Intermittency Phenomenon 182 10.10 Appendix: Target Intervention with Small Target Band 183 Chapter 11: Conclusion 185 References 191 Index 197
£85.00
Princeton University Press Income Distribution in Macroeconomic Models
Book SynopsisLooks at the distribution of income and wealth and the effects that this has on the macroeconomy, and vice versa. Taking stock of results and methods developed in the context of the 1990s revival of growth theory, this book focuses on capital accumulation and long-run growth.Trade Review"The interaction between the dynamics of economic growth and the evolution of economic inequality is an important and challenging problem. Recent advances in macroeconomics of heterogeneous agents have finally made it possible to investigate this question in a systematic manner. This timely book offers an excellent first broad overview in this area. The ideas in the book are so intuitive that they can be taught to advanced undergraduates. The exposition is so clear, simple and yet rigorous that the book is useful in a first-year graduate macro sequence. Its comprehensive coverage makes it an indispensable source of reference for the researcher in the field. A great achievement! I wish I had written this book."—Kiminori Matsuyama, Northwestern University"Income distribution questions are becoming increasingly important in modern macroeconomic theory, and they will probably become even more so as computational techniques are utilized to move macroeconomics beyond the representative agent paradigm. This book does a good job in summarizing the current state of the literature in an interesting and hands-on way."—Alex Michaelides, London School of Economics"A well balanced, clearly argued, up-to-date, and informative account of the subject. The arguments that spin off from this book will interest not only macroeconomists but also others in the field."—Frank Cowell, Professor of Economics and Director of Distributional Analysis Research Programme, London School of Economics; author of The Economics of Poverty and InequalityTable of ContentsIntroduction ix Part One Aggregate Growth and Individual Savings 1 Chapter One: Production and Distribution ofIncome in a Market Economy 3 1.1 Accounting 4 1.2 The Neoclassical Theory of Distribution 8 Chapter Two: Exogenous Savings Propensities 14 2.1 A Linear Consumption Function 16 2.2 References and Further Issues 25 Chapter Three: Optimal Savings 28 3.1 The Optimal Consumption Path 29 3.2 The Dynamics of Accumulation and Distribution 36 3.3 Welfare Distribution in Complete Markets 41 3.4 References and Further Issues 46 3.5 Appendix:HARA Preferences 47 3.6 Review Exercises 48 Chapter Four: Factor Income Distribution 51 4.1 Factor Shares and Savings in Early Growth Models 53 4.2 Factor Shares in the Neoclassical Growth Model 57 4.3 Optimal Savings and Sustained Growth 63 4.4 Policy and Political Economy 70 4.5 References and Further Issues 77 4.6 Appendix:Factor Shares in a Two-Sector Growth Model 81 Chapter Five: Savings and Distribution with Finite Horizons 88 5.1 Distribution and Growth in the Two-Period OLG Model 90 5.2 Inequality in a Perpetual Youth Model 104 5.3 One-Period Lifetimes and Bequests 115 5.4 References and Further Issues 122 5.5 Appendix:Consumption in the Perpetual Youth Model 124 Chapter Six: Factor Shares and Taxation in the OLG Model 127 6.1 Factor Shares in the Two-Period Model 128 6.2 Factor Shares and Growth in the Perpetual Youth Model 138 6.3 References and Further Issues 143 Part Two: Financial Market Imperfections 145 Chapter Seven: Investment Opportunities and the Allocation ofSavings 147 7.1 Decreasing Returns to Individual Investment 148 7.2 Increasing Returns and Indivisibilities 158 7.3 Endogenous Factor Prices and "Trickle-Down "Growth 165 7.4 References and Further Issues 172 7.5 Review Exercises 177 Chapter Eight: Risk and Financial Markets 180 8.1 Optimization under Uncertainty 181 8.2 Rate-of-Return Risk 189 8.3 Portfolio Choice and Risk Pooling 195 8.4 References and Further Issues 200 8.5 Review Exercise 202 Chapter Nine: Uninsurable Income Shocks 204 9.1 A Two-Period Characterization 205 9.2 General Equilibrium:The CARA Case 210 9.3 General Equilibrium:The CRRA Case 214 9.4 Application:Uninsurable Risk in the Labor Markets 226 9.5 References and Further Issues 235 P rt Three Many Goods 239 Chapter Ten: Distribution and Market Power 241 10.1 Growth through Expanding Product Variety 243 10.2 Variable Elasticities of Substitution 252 10.3 Factor Shares,Taxation,and Political Economy 262 10.4 References and Further Issues 264 Chapter Eleven: Indivisible Goods and the Composition of Demand 266 11.1 Income Distribution and Product Diversity 268 11.2 The Introduction of New Products 275 11.3 Inequality and Vertical Product Differentiation 285 11.4 References and Further Issues 298 Chapter Twelve: Hierarchic Preferences 302 12.1 A Basic Framework 303 12.2 Growth,Distribution,and Structural Change 313 12.3 References and Further Issues 319 Chapter Thirteen: Dynamic Interactions of Demand and Supply 321 13.1 Learning by Doing and Trickle-Down 322 13.2 Demand Composition and Factor Rewards 328 13.3 References and Further Issues 337 Solutions to Exercises 339 References 399 Index 419
£80.75
Princeton University Press Why Gender Matters in Economics
Book SynopsisGender matters in economics--for even with today's technology, fertility choices, market opportunities, and improved social norms, economic outcomes for women remain markedly worse than for men. Drawing on insights from feminism, postmodernism, psychology, evolutionary biology, Marxism, and politics, this textbook provides a rigorous economic lookTrade ReviewWinner of the 2015 PROSE Award in Textbook/Social Sciences, Association of American Publishers One of Choice's Outstanding Academic Titles for 2015 "Providing an accessible textbook-style survey of this emerging field, Mukesh Eswaran's Why Gender Matters in Economics plugs a gaping hole in the discipline. Drawing on insights not only from feminism but also from evolutionary biology, anthropology, psychology, politics and Marxism, Eswaran seeks to answer questions of interest to us all."--Victoria Bateman, Times Higher Education "[Why Gender Matters in Economics] provides a practical understanding of how economic reasoning informs discussions around such topics as the balance of power in households, labor markets, wealth, credit markets, fertility and health care, marriage, suffrage, and empowerment... This book is a comprehensive and discerning work that should provide readers with the context and understanding to more effectively comprehend the substantive economic role of gender."--Choice "A rich trove of information about what are commonly though of as 'women's issues' in economics."--Julie A. Nelson, Journal of Economic Literature
£40.50
Princeton University Press Advances in Behavioral Finance Volume II
Book SynopsisOffers an overview of developments in behavioral finance. This volume presents twenty papers by leading specialists that illustrate the abiding power of behavioral finance - of how specific departures from fully rational decision making by individual market agents can provide explanations of otherwise puzzling market phenomena.Trade Review"This is an excellent and useful book which should be recommended to all students of finance."--Peter Howells, Economic IssuesTable of ContentsPreface xi Richard H. Thaler Acknowledgments xix List of Abbreviations xxiii Chapter 1: A Survey of Behavioral Finance by Nicholas Barberis and Richard H. Thaler 1 Part I: Limits to Arbitrage Chapter 2: The Limits of Arbitrage by Andrei Shleifer and Robert W. Vishny 79 Chapter 3: How Are Stock Prices Affected by the Location of Trade? by Kenneth A. Froot and Emil M. Dabora 102 Chapter 4: Can the Market Add and Subtract? Mispricing in Tech Stock Carve-outs by Owen A. Lamont and Richard H. Thaler 130 Part II: I Stock Returns and the Equity Premium Chapter 5: Valuation Ratios and the Long-run Stock Market Outlook: An Update by John Y. Campbell and Robert J. Shiller 173 Chapter 6: Myopic Loss Aversion and the Equity Premium Puzzle by Shlomo Benartzi and Richard H. Thaler 202 Chapter 7: Prospect Theory and Asset Prices by Nicholas Barberis, Ming Huang, and Tano Santos 224 Part III: Empirical Studies of Overreaction and Underreaction Chapter 8: Contrarian Investment, Extrapolation, and Risk by Josef Lakonishok, Andrei Shleifer, and Robert W. Vishny 273 Chapter 9: Evidence on the Characteristics of Cross-sectional Variation in Stock Returns by Kent Daniel and Sheridan Titman 317 Chapter 10: Momentum by Narasimhan Jegadeesh and Sheridan Titman 353 Chapter 11: Market Efficiency and Biases in Brokerage Recommendations by Roni Michaely and Kent L. Womack 389 Part IV: Theories of Overreaction and Underreaction Chapter 12: A Model of Investor Sentiment by Nicholas Barberis, Andrei Shleifer, and Robert W. Vishny 423 Chapter 13: Investor Psychology and Security Market Under- and Overreaction by Kent Daniel, David Hirshleifer, and Avanidhar Subrahmanyam 460 Chapter 14: A Unified Theory of Underreaction, Momentum Trading, and Overreaction in Asset Markets by Harrison Hong and Jeremy C. Stein 502 Part V: Investor Behavior Chapter 15: Individual Investors by Brad M. Barber and Terrance Odean 543 Chapter 16: Naive Diversification Strategies in Defined Contribution Savings Plans by Shlomo Benartzi and Richard H. Thaler 570 Part VI: Corporate Finance Chapter 17: Rational Capital Budgeting in an Irrational World by Jeremy C. Stein 605 Chapter 18: Earnings Management to Exceed Thresholds by Francois Degeorge, Jayendu Patel, and Richard Zeckhauser 633 Chapter 19: Managerial Optimism and Corporate Finance by J. B. Heaton 667 List of Contributors 685 Index 695
£73.80
Princeton University Press Economic and Financial Decisions under Risk
Book SynopsisThe book presents a thoroughly accessible introduction to risk, bridging the gap between the traditionally separate economics and finance literatures.Trade ReviewWinner of the 2007 Kulp-Wright Book Award, American Risk and Insurance Association "This delightful little book is aimed at advanced undergraduate and first year graduate students who need to learn about modeling risk... It contains deep and insightful discussions about all the topics under consideration."--Tapen Sinha, Journal of Risk and InsuranceTable of ContentsPreface ix I: Decision Theory 1 Chapter 1: Risk Aversion 3 1.1 An Historical Perspective on Risk Aversion 3 1.2 Definition and Characterization of Risk Aversion 7 1.3 Risk Premium and Certainty Equivalent 9 1.4 Degree of Risk Aversion 13 1.5 Decreasing Absolute Risk Aversion and Prudence 16 1.6 Relative Risk Aversion 17 1.7 Some Classical Utility Functions 19 1.8 Bibliographical References, Extensions and Exercises 22 Chapter 2: The Measures of Risk 27 2.1 Increases in Risk 28 2.2 Aversion to Downside Risk 36 2.3 First-Degree Stochastic Dominance 37 2.4 Bibliographical References, Extensions and Exercises 39 II Risk Management 43 Chapter 3: Insurance Decisions 45 3.1 Optimal Insurance: an Illustration 47 3.2 Optimal Coinsurance 49 3.3 Comparative Statics in the Coinsurance Problem 53 3.4 The Optimality of Deductible Insurance 56 3.5 Bibliographical References, Extensions and Exercises 59 Chapter 4: Static Portfolio Choices 65 4.1 The One-Risky-One-Riskfree-Asset Model 65 4.2 The Effect of Background Risk 684.3 Portfolios of Risky Assets 70 4.4 Bibliographical References, Extensions and Exercises 74 Chapter 5: Static Portfolio Choices in an Arrow-Debreu Economy 77 5.1 Arrow-Debreu Securities and Arbitrage Pricing 78 5.2 Optimal Portfolios of Arrow-Debreu Securities 80 5.3 A Simple Graphical Illustration 83 5.4 Bibliographical References, Extensions and Exercises 85 Chapter 6: Consumption and Saving 89 6.1 Consumption and Saving under Certainty 89 6.2 Uncertainty and Precautionary Savings 95 6.3 Risky Savings and Precautionary Demand 98 6.4 Time Consistency 99 6.5 Bibliographical References, Extensions and Exercises 101 Chapter 7: Dynamic Portfolio Management 107 7.1 Backward Induction 108 7.2 The Dynamic Investment Problem 109 7.3 Time Diversification 113 7.4 Portfolio Management with Predictable Returns 114 7.5 Learning about the Distribution of Excess Returns 117 7.6 Bibliographical References, Extensions and Exercises 119 Chapter 8: Risk and Information 123 8.1 The Value of Information 123 8.2 Comparative Statics Analysis 130 8.3 The Hirshleifer Effect 134 8.4 Bibliographical References, Extensions and Exercises 136 Chapter 9: Optimal Prevention 141 9.1 Prevention under Risk Neutrality 142 9.2 Risk Aversion and Optimal Prevention 142 9.3 Prudence and Optimal Prevention 144 9.4 Bibliographical References, Extensions and Exercises 145 III Risk Sharing 151 Chapter 10: Efficient Allocations of Risks 153 10.1 Risk Sharing: an Illustration 153 10.2 Description of the Economy and Definition 155 10.3 Characterization of Efficient Allocations of Risk 157 10.4 Aggregation of Preferences 163 10.5 Bibliographical References, Extensions and Exercises 165 Chapter 11: Asset Pricing 169 11.1 Competitive Markets for Arrow-Debreu Securities 169 11.2 The First Theorem of Welfare Economics 170 11.3 The Equity Premium 17211.4 The Capital Asset-Pricing Model 175 11.5 Two-Fund Separation Theorem 177 11.6 Bond Pricing 179 11.7 Bibliographical References, Extensions and Exercises 184 IV Extensions 189 Chapter 12: Asymmetric Information 191 12.1 Adverse Selection 192 12.2 Moral Hazard 199 12.3 The Principal-Agent Problem 203 12.4 Bibliographical References, Extensions and Exercises 209 Chapter 13: Alternative Decision Criteria 213 13.1 The Independence Axiom and the Allais Paradox 215 13.2 Rank-Dependent EU 217 13.3 Ambiguity Aversion 221 13.4 Prospect Theory and Loss Aversion 224 13.5 Some Concluding Thoughts 226 13.6 Bibliographical References, Extensions and Exercises 227 Index 231
£61.20
Princeton University Press New Wealth for Old Nations
Book SynopsisProvides a guide to policy priorities in small or regional economies. This work combines some of the world's leading economists' research insights with a discussion of the practicalities of implementing structural reforms. It is aimed at policymakers and scholars seeking avenues to improved growth, greater opportunity, and better governance.Trade Review"New Wealth for Old Nations focuses on the challenge of improving prosperity in small open economies committed to social justice and environmental sustainability... The strengths of the collection lie mainly in the astute insights and systematic analysis in the individual chapters. The book is a valuable and polished set of essays with many interesting observations on the complex dynamics and drivers of regional economic development."--Ivan Turok, Journal of Regional ScienceTable of ContentsPreface vii List of Contributors ix Introduction 1 Chapter One: The Political Economy of Scotland, Past and Present by W. Alexander, J. Armstrong, B. Ashcroft, D. Coyle, J. McLaren 11 PART 1. GROWTH 33 Chapter Two: Second Winds for Industrial Regions? by P. Krugman 35 Chapter Three: Four Sources of Innovation and the Stimulation of Growth in the Scottish Economy by W. J. Baumol 48 Chapter Four: Four Challenges for Scotland's Cities by E. L. Glaeser 73 Chapter Five: The Economic Case for Fiscal Federalism by P. Hallwood and R. MacDonald 96 PART 2. OPPORTUNITY 117 Chapter Six: Skill Policies for Scotland by J. J. Heckman and D. V. Masterov 119 Chapter Seven: Starting Life in Scotland by H. E. Joshi and R. E. Wright 166 PART 3. GOVERNANCE 187 Chapter Eight: High-Quality Public Services by N. Crafts 189 Chapter Nine: Committing to Growth in a Small European Country by J. Bradley 210 Chapter Ten: Conclusions 232
£99.00
Princeton University Press From Populations to Ecosystems Theoretical
Book SynopsisExplaining how the principles of population dynamics and ecosystem functioning can be merged, this title addresses key issues in the study of biodiversity and ecosystems, such as functional complementarity, food webs, stability and complexity, material cycling, and metacommunities.Trade Review"This reviewer was particularly intrigued by the author's resurrection of the hypothesis that ecosystem complexity and biodiversity supports ecosystem stability, an early romantic notion that turned out to be extremely difficult to demonstrate. He makes a convincing case that this hypothesis may have merit after all."--Choice "This is a superbly written book about a very important challenge, namely that the theories of population, community and ecosystem ecology, and of evolution, have developed separately and are not entirely compatible. We need a synthesis of theories of population dynamics and ecosystem function and, faced with a global environmental crisis, we need it badly. This book is an excellent start... I strongly recommend this book to researchers in any branch of ecology."--Alan J. Butler, Austral Ecology "I found the text both informative and interesting, and certainly relied upon my background in population ecology and genetics in reviewing this text. In the classroom environment, I could see this text being used in a graduate seminar or perhaps a senior-level honors class in biology, ecology, environmental science, or any of the related disciplines (as a paleontologist, I would certainly recommend it!)."--Ryan F. Morgan, PriscumTable of ContentsAcknowledgments vii Preface: On Unifying Approaches in Ecology ix Chapter 1: Population and Ecosystem Approaches in Ecology 1 Chapter 2: The Maintenance and Functional Consequences of Species Diversity 19 Chapter 3: Biodiversity and Ecosystem Functioning 56 Chapter 4: Food Webs, Interaction Webs, and Ecosystem Functioning 79 Chapter 5: Stability and Complexity of Ecosystems: New Perspectives on an Old Debate 123 Chapter 6: Material Cycling and the Overall Functioning of Ecosystems 164 Chapter 7: Spatial Dynamics of Biodiversity and Ecosystem Functioning: Metacommunities and Metaecosystems 196 Chapter 8: Evolution of Ecosystems and Ecosystem Properties 225 Chapter 9: Postface: Toward an Integrated, Predictive Ecology 260 References 269 Index 291
£52.20
Princeton University Press Monopsony in Motion
Book SynopsisAnalyzes labor markets from the real-world perspective: employers have significant market (or monopsony) power over their workers. Arguing that this power derives from frictions in the labor market that make it time-consuming and costly for workers to change jobs, this book re-examines much of labor economics based on this assumption.Trade Review"Given the breadth and depth of the issues Manning covers--clearly, a staggering amount of work went into this book--even skeptical readers will not be able to dismiss his theory lightly... The book is so well written that even the most complicated material in it is readable. The presentation is also commendably well balanced... [It] deserves a place on our bookshelves alongside the other seminal works in labor economics."--Michael Rizzo, Industrial and Labor Relations Review "The manner of Manning's exposition of his arguments advocating the monopsonist view is impressive... [I]t will be hard for even the utmost skeptic and expert not to come away having learnt something more about labor economics."--Eric A. Strobl, Journal of Economic Behavior and OrganizationTable of Contents*FrontMatter, pg. i*Contents, pg. vii*Preface, pg. xi*1. Introduction, pg. 3*2. Simple Models of Monopsony and Oligopsony, pg. 29*3. Efficiency in Oligopsonistic Labor Markets, pg. 56*4. The Elasticity of the Labor Supply Curve to an Individual Firm, pg. 80*5. The Wage Policies of Employers, pg. 117*6. Earnings and the Life Cycle, pg. 141*7. Gender Discrimination in Labor Markets, pg. 193*8. Employers and Wages, pg. 217*9. Unemployment, Inactivity, and Labor Supply, pg. 239*10. Vacancies and the Demand for Labor, pg. 269*11. Human Capital and Training, pg. 301*12. The Minimum Wage and Trade Unions, pg. 325*13. Monopsony and the Big Picture, pg. 360*Data Sets Appendix, pg. 369*Bibliography, pg. 379*Index, pg. 397
£63.00
Princeton University Press The New Division of Labor
Book SynopsisShows how computers are changing the employment landscape and how the right kinds of education can ease the transition to the new job market. This book tells stories of people at work - a high-end financial advisor, a customer service representative, a pair of successful chefs, a cardiologist, and an automotive mechanic.Trade Review"Behind all the angst about computers and outsourcing destroying American livelihoods lies a story about economic change and its effect on workers. With welcome clarity, brevity, and insight, Levy and Murnane tell us how to make sense of the time in which we live."--David Wessel, "Capital" columnist, Wall Street Journal "In their brilliant new book The New Division of Labor: How Computers Are Creating the Next Job Market, Frank Levy and Richard J. Murnane write that the future belongs to people who excel at expert thinking (solving problems for which there are no rules-based solutions) and complex communication (interacting with people to acquire information, understand what that information means and persuade others of its implications for action)."--ComputerWorld "A concise and easily accessible exploration of how the computer has shifted the demands for certain types of skills. Unlike the sky-is-falling commentators of the left and the technology-will-solve-all-problems cheerleaders of the right, Levy and Murnane use history, anecdotes and statistical analysis to delineate how technology will change the nature of work."--Washington Post "[A] fascinating book. Not since the mathematical economist Truman Bewley interviewed 300 business executives and labor leaders for Why Wages Don't Fall during a Recession have sophisticated economists waded so deeply into the real-world circumstances of the important problem they are seeking to understand."--David Warsh, economicprincipals.com "Remember that barely one-third of New York City's eighth-graders can read and do basic math. Then, read this book."--Nicole Gelinas, New York Post "Frank Levy and Richard J. Murnane have written a very readable introduction to some key issues facing US workers in an increasingly informational economy... [R]eaders exploring these ideas for the first time will find this an engaging and provocative introduction to an important set of political-economic processes that continue to bring information technology and human labor together, for better or for worse."--Greg Downey, International Review of Social HistoryTable of ContentsAcknowledgments vii CHAPTER 1 New Divisions of Labor 1 PART I Computers and the Economy CHAPTER 2 Why People Still Matter 13 CHAPTER 3 How Computers Change Work and Pay 31 PART II The Skills Employers Value CHAPTER 4 Expert Thinking 57 CHAPTER 5 Complex Communication 76 PART III How Skills Are Taught CHAPTER 6 Enabling Skills 99 CHAPTER 7 Computers and the Teaching of Skills 109 CHAPTER 8 Standards-Based Education Reform in the Computer Age 131 CHAPTER 9 The Next Ten Years 149 Notes 159 Index 169
£28.50
Princeton University Press Competitive Solutions The Strategists Toolkit
Book SynopsisProvides an introduction to successful business methods applied to a variety of real-world situations. This work develops the intellectual tools and insights needed to confront many marketplace problems. It emphasizes cooperation, pricing, litigation, and antitrust as vital to a firm's competitive posture.Trade ReviewOne of Strategy & Business's Best Business Books for 2003 "Competitive Solutions: The Strategist's Toolkit belongs on every strategist's bookshelf. McAfee is an economist with a gift for selecting and communicating the best new thinking by economists about business, translating from often abstruse mathematics to clear English and understandable examples. McAfee explains economists' latest thinking about pricing, auctions, signaling, and incentives--key decisions that have make-or-break potential for a company."--Strategy & Business "[T]his book does an excellent job of translating the insights of modern IO into language that business students can readily grasp... I am confident that this is a book that will be received by good students and will serve well as the main text in any strategy course that approaches the topic."--Benjamin E. Hermalin, Journal of Economic LiteratureTable of ContentsPreface xiii Preamble xiii Contents xvi What Is Strategy? xviii Acknowledgments xix Chapter 1. Introduction 1 Executive Summary--Introduction 7 Chapter 2. Industry Analysis 9 The Five Six Forces 9 Entry 11 Buyer Bargaining Power 16 Supplier Bargaining Power 18 Substitute Products 18 Rivalry 19 Complements-The Sixth Force 23 Strategies for Complements 26 Industry Structures 27 Fragmented Industry 28 Dominant Firm 30 Tight Oligopoly 33 Loose Oligopoly 34 Executive Summary -Industry Analysis 34 Chapter 3. Firm Strategies 36 Value/Cost Strategies 36 Quality Choice without Competition 37 Games and Best Responses 38 The Effects of Competition on Quality Choice 42 Accommodation and Dissuasion 44 Low-Cost Strategy 45 Cream-Skimming 47 Coherent Strategies 48 The Three-Layer Model 50 Stuck in the Middle 56 Dealing with Competitors 57 Executive Summary--Firm Strategies 58 Chapter 4. Differentiation 61 Competition in Differentiated Products 63 Creating Synergies 70 Quality Complementarities 74 Networks 75 Technological Races 78 Patent Strategy 80 Hedonic Prices 85 Executive Summary--Differentiation 89 Chapter 5. Product Life Cycle 91 Introduction 95 Growth 97 Maturity 98 Decline and Replacement 101 Summary of the Product Life Cycle 105 The Life Cycle for Durable Goods 108 Executive Summary--Product Life Cycle 112 Chapter 6. Cooperation 113 Cooperation on a Variety of Issues 113 Tacit Collusion 116 Shared Interest 116 Punishment 119 Recovery 124 Problems of Tacit Cooperation in Price 127 Confessions 128 Many Producers 129 Differentiated Products 129 Reaction Time 130 Environmental Randomness 132 Motivating Managers 132 Efficient Allocation within a Cartel 133 Unenforceable Contracts 135 Risky Communication 135 Small or Failing Firms 135 Entry and Substitutes 136 Competition in Other Dimensions 137 Solutions to Tacit Cooperation Problems 138 Industry Association 138 Published Price Lists 139 Exclusive Territories 139 Preannouncing Future Price Increases 140 The Capture Theory 140 Incrementalism 141 Multimarket Contact 142 Multilevel Contact 144 Unused Capacity 144 Grow or Crush Small or Bankrupt Firms 145 Executive Summary--Cooperation 146 Chapter 7. Organizational Scope 148 Make or Buy Decisions 151 Tapered Integration 158 The Multidivisional Firm 160 Transaction Costs 163 Prices or Quantities 170 Net Present Value 172 Project Selection and Risk Assessment 179 Executive Summary--Organizational Scope 184 Chapter 8. Incentives 187 Agency 188 Efficiency Wages 191 Making Firms More Aggressive 192 Agent Selection 193 Managing Creative Talent 194 Multitasking 195 Common Agency 199 Tournaments and Yardstick Competition 201 Ratchet Effect 202 Executive Summary--Incentives 203 Chapter 9. Antitrust 204 Major Laws 204 Sherman Act (1890) 205 Clayton Act (1914) 206 FTC Act (1914) 209 Exemptions and Special Treatment 210 Predation, Foreclosure, and Tying 211 Mergers 214 DOJ Guidelines for Horizontal Mergers 216 Vertical Mergers and Antitrust Enforcement 221 Executive Summary--Antitrust 224 Chapter 10. Elementary Statistics 225 Opinion Polls 226 The Precision of Statistics 234 The Normal Distribution or Bell Curve 236 Conditional Probabilities and Correlation 239 The Predator Theory of Tornadoes 244 Sample Selection Bias 246 The Hot Hand 247 Option Values 251 Scenario Analysis 255 Executive Summary--Elementary Statistics 258 Chapter 11. Pricing 260 Illustrative Examples 262 International Pricing by the Pharmaceutical Companies 262 Methyl Methacrylate 262 Hand-Me-Down by Armani 264 IBM LaserPrinter E 264 Sony MiniDisc 265 An Electric Utility's Individualized Pricing 265 IBM's Punchcard Metering 266 Buying Paint from an Airline 266 Direct Price Discrimination 268 Indirect Price Discrimination 273 Coupons 273 Quantity Discounts 274 Product Branding 276 Product Bundling 277 Peak-Load Pricing 278 Yield Management 281 Theatrical Yield Management 284 Robert Crandall on Airline Pricing 285 Competition and Price Discrimination 288 How to Soften Price Competition 289 Opportunism and Exclusive Dealing 289 Create Competition by Licensing 292 Vertically Integrate with the Buyers 292 Long-Term Contracts 292 Exclusive Contracts 293 Most-Favored-Customer Clauses 293 Uniform, Simple Contracts 294 Pricing of Complements 295 Price Dispersion and the Theory of Sales 297 Executive Summary--Pricing 300 Chapter 12. Auctions 303 Bidding 303 The English Auction 304 The Sealed-Bid Auction 305 The Winner's Curve 307 Updating 311 Selling Strategy and Auction Design 312 When to Auction? 320 Executive Summary--Auctions 322 Chapter 13. Signaling 324 Signaling in Action 324 Law Firms' Marbled Buildings 324 Service Plans and Warranties 325 The $25,000 Rolex Watch 327 Body Language 327 Education 328 Full Product Line 331 Appearing Informed in an Auction 333 Tylenol Recall 333 Lemons 337 Introductory Offers and Advertising 340 Entry Deterrence 342 Leadership 344 Acting Tough 345 Vaporware 348 Product Failures 349 Signaling Psychosis 350 Executive Summary--Signaling 351 Chapter 14. Bargaining 353 Basic Theory 353 Delay 356 The War of Attrition 357 Lawsuits 360 Drug Wars 361 BSB versus Sky TV 364 Holdup 364 Contract Design and Verification 366 Verification and Observability 367 Renegotiation Proofness 369 Breach Penalties 370 Strategic Ambiguity 372 Delegation 373 Exploding Offers 373 Multilateral Bargaining 374 Cheap Talk 376 Executive Summary--Bargaining 378 Chapter 15. Last Words 379 Sustaining Competitive Advantages 379 Endnotes: Sources and Caveats 381 Index 393
£49.50
Princeton University Press Capital and Collusion
Book SynopsisWhy does capital formation often fail to occur in developing countries? This work explores the political incentives that either foster growth or steal nations' growth prospects. It examines the frontier between risk and uncertainty, analyzing the forces driving development in both developed and undeveloped regions.Trade Review"Capital and Collusion provides an interesting read for anyone attracted by the complexity of international political economic development... By highlighting the forces at work in developing countries, Root addresses the notion that distribution of wealth is often complex and requires situation specific responses to nations who are hindered by collusive cultural practices."--Andrew J. Prelog, Journal of Economic IssuesTable of ContentsTables and Figures ix PART I: Analytical Perspectives 1 CHAPTER ONE: Risk, Uncertainty, and Social Progress 3 CHAPTER TWO: Social Foundations of Policy Credibility 17 CHAPTER THREE: Politics and Economic Structure: The Economic Logic of Autocracy 35 CHAPTER FOUR: An Amazing Economy of Information: The Financial System 48 PART II: Regional and National Complexity 57 CHAPTER FIVE: Closing the Social Productivity Gap in East Asia 59 CHAPTER SIX: The Price of Exclusion: Latin America's Explosive Debt 89 CHAPTER SEVEN: Why Not India?New Century, New Country 114 CHAPTER EIGHT: Pakistan on the Edge 157 CHAPTER NINE: China's Capitalist Dream: Between Hierarchy and Market 187 PART III: Conclusion 219 CHAPTER TEN: Mobilizing the State as Public Risk Manager 221 CONCLUSION: Uncertainty, Competition, and Collusion in Early Capital Accumulation 246 Acknowledgments 249 Appendix 1 Data Sources 251 Appendix 2 Variables 252 Notes 253 References 307 Index 327
£52.20
Princeton University Press Quantal Response Equilibrium A Stochastic Theory
Book SynopsisQuantal Response Equilibrium presents a stochastic theory of games that unites probabilistic choice models developed in psychology and statistics with the Nash equilibrium approach of classical game theory. Nash equilibrium assumes precise and perfect decision making in games, but human behavior is inherently stochastic and people realize that theTrade Review"This book brings together two decades of scholarship on an important model of boundedly rational behavior in strategic decision-making settings. Including numerous important applications in economics, political science, and pure game theory, this unified treatment will be valuable to a wide range of scholars."—Timothy Cason, Purdue University"Quantal response equilibrium is a standard tool for game theorists and has numerous connections to other tools and applications. This book collects and extends existing material on QRE and is a significant contribution to pure, and especially applied, game theory. No other books explicate QRE systematically beyond the introductory level and these authors are the right team for pulling the core material together."—Daniel Friedman, University of California, Santa Cruz"Well-written and easy to follow, this book covers the topic of quantal response equilibrium. The notion of stochastic equilibrium has changed the way game theorists think about long-run and short-run equilibrium. Written by three leading experts, this book is of great importance to researchers in economic theory and political science, and to graduate students."—David K. Levine, European University InstituteTable of Contents*Frontmatter, pg. i*Contents, pg. v*Preface, pg. ix*1. Introduction and Background, pg. 1*2. Quantal Response Equilibrium in Normal-Form Games, pg. 10*3. Quantal Response Equilibrium in Extensive-Form Games, pg. 63*4. Heterogeneity, pg. 88*5. Dynamics and Learning, pg. 112*6. QRE as a Structural Model for Estimation, pg. 141*7. Applications to Game Theory, pg. 161*8. Applications to Political Science, pg. 206*9. Applications to Economics, pg. 248*10. Epilogue: Some Thoughts about Future Research, pg. 281*References, pg. 291*Index, pg. 301
£52.20
Princeton University Press Experimental Economics Rethinking the Rules
Book SynopsisSince the 1980s, there has been explosive growth in the use of experimental methods in economics, leading to exciting developments in economic theory and policy. Despite this, the status of experimental economics remains controversial. This title offers an integrated look at the nature and reliability of claims based on experimental research.Trade Review"Experimental Economics is a well intentioned book which does an admirable job in consolidating and modernising the ongoing methodological debates surrounding experimental economics... I would recommend this book to empirical social scientists, particularly the first two parts, which crystallise the major debates ongoing in the discipline."--Tom Wilkening, The Economic Record "This is an extremely rich and cultured book that makes a large number of intelligent points about experimental methods. It also raises sophisticated questions concerning what it means to test a theory and how one can test in an environment in which an error model unconstrained by theory is essential to judging empirical fit."--Andrew Caplin, Journal of Economics and PhilosophyTable of ContentsPreface vii Chapter 1: Introduction 1 1.1 Experiments in Economics 1 1.2 Does Economics Need Experiments? 4 1.3 The Practice of Experimental Economics 11 1.4 The Illustrations and the Structure of the Book 23 1.5 Methods, Methodology, and Philosophy of Science 36 Chapter 2: Theory Testing and the Domain of Economic Theory 46 2.1 Domain Restrictions: Economic Theory and the Laboratory 46 2.2 Generality and External Validity 49 2.3 The Blame-the-Theory Argument 54 2.4 The Concept of Domain 56 2.5 The Laboratory and the Three Senses of Domain 64 2.6 Application to Experimental Tests of Choice Theory 71 2.7 Application to Experimental Tests of Equilibrium Predictions 85 2.8 Conclusions 92 Chapter 3: Experimental Testing in Practice 95 3.1 Preliminaries 95 3.2 Experimental Testing and the Duhem-Quine Thesis 95 3.3 On the Significance of the DQT for Testing 106 3.4 On Testing Game Theory 114 3.5 Hard Cores, Progress, and Experiments 128 3.6 Conclusion 138 Chapter 4: Experiments and Inductive Generalization 141 4.1 Preliminaries 141 4.2 Deduction versus Induction 142 4.3 How Inductive Investigation Works 145 4.4 Experiments as Tests 150 4.5 Exhibits 156 4.6 Why Be Interested in Exhibits? 160 4.7 Do Exhibits Need to Be Explained? 166 4.8 Multiple Causation 169 4.9 Explaining Exhibits Inductively 172 4.10 Investigating Exhibits without Trying to Explain Them 184 4.11 Experiments as Models 189 4.12 Conclusion 194 Chapter 5: External Validity 196 5.1 Introduction 196 5.2 Are Economics Experiments Models? 197 5.3 Tests of Applied Economics Theories 204 5.4 Types of Artificiality Criticism 214 5.5 Alteration Contrasted with Omission and Contamination 228 5.6 Evaluating Alteration Criticisms 233 5.7 Field Experiments 237 5.8 Conclusions 242 Chapter 6: Incentives in Experiments 244 6.1 Preliminaries 244 6.2 Incentives, Design, and Control 246 6.3 Incentives in Experimental Economics: Convention in Action 248 6.4 Three Perspectives on the Effect of Incentives on Behavior 250 6.5 Incentive Mechanisms 264 6.6 Conclusion 284 Chapter 7: Noise and Variability in Experimental Data 286 7.1 "Noise" in Economics and in Experimental Economics 286 7.2 "Noise" in Individual Decision Experiments 289 7.3 "Noise" in Experimental Games 306 7.4 Exploring Different Stochastic Specifications 322 7.5 Concluding Remarks 329 Chapter 8: Conclusion 331 8.1 How Successful Has Experimental Economics Been in Developing a Sound Methodology? 332 8.2 How Successful Has Experimental Economics Been in Increasing Understanding of Economic Behavior? 338 8.3 Has Experimental Economics Had a Positive Impact on Wider Economics? 342 References 347 Index 369
£70.20
Princeton University Press Computational Economics
Book SynopsisDesigned to help move from verbal to mathematical to computational representations in economic modeling, this book is organized around economic topics as macroeconomics, microeconomics, and finance. It employs software systems, including MATLAB, Mathematica, GAMS, the nonlinear programming solver in Excel, and the database systems in Access.Trade Review"Important and useful... [T]his book represents an excellent way to learn computational economics, doing it."--Pietro Terna, Journal of Artificial Societies and Social SimulationTable of ContentsPreface ix Introduction 1 PART I: Once Over Lightly ... Growth Chapter 1: Growth Model in Excel 9 Finance Chapter 2: Neural Nets in Excel 25 Microeconomics Chapter 3: PartIal Equilibrium in Mathematica 37 Chapter 4: Transportation in GAMS 55 Database Chapter 5: Databases in Access 67 Finance Chapter 6: Thrift in GAMS (with Genevieve Solomon) 91 Chapter 7: Portfolio Model in MATLAB 119 PART II: Once More ... Microeconomics Chapter 8: General Equilibrium Models in GAMS 149 Game Theory Chapter 9: Cournot Duopoly in Mathematica (with Daniel Gaynor) 173 Chapter 10: Stackelberg Duopoly in Mathematica (with Daniel Gaynor) 189 Chapter 11: Genetic Algorithms and Evolutionary Games in MATLAB 201 Finance Chapter 12: Genetic Algorithms and Portfolio Models in MATLAB 223 Macroeconomics Chapter 13: Macroeconomics in GAMS 247 Agent-Based Computational Economics Chapter 14: Agent-Based Model in MATLAB 267 Environmental Economics Chapter 15: Global Warming in GAMS 291 Dynamic Optimization Chapter 16: Dynamic Optimization in MATLAB 309 PART III: Special Topic:tochastic Control Stochastic Control Chapter 17: Stochastic Control in Duali 339 Chapter 18: Rational Expectations Macro in Duali 361 APPENDIXES A. Running GAMS 389 B. Running Mathematica 391 C. Running the Solver in Excel 393 D. Ordered Sets in GAMS 394 E. Linearization and State-Space Representation of Hall and Taylor's Model 396 F. Introduction to Nonlinear Optimization Solvers 403 G. Linear Programming Solvers 407 H. The Stacking Method in GAMS 411 I. Running MATLAB 413 J. Obtaining the Steady State of the Growth Model 414 References 417 Index 425
£103.50
Princeton University Press International Trade with Equilibrium Unemployment
Book SynopsisBrings together the authors' work in creating models that more accurately reflect the real-world connections between international trade and labor markets. This book addresses the shortcomings of standard models and describes the empirics that underlie equilibrium unemployment models.Trade Review"The pathbreaking research synthesized in this volume shows that labor market frictions are central to understanding the distributional consequences of international trade. Anyone interested in the intellectual debate about globalization should read this book. It is an essential reference for researchers and students in international trade."—Stephen J. Redding, London School of Economics and Political Science"Davidson and Matusz pioneered the modern theory of international trade with labor market frictions. This book knits together their major work on this subject, and delivers fundamental insights concerning the effects of globalization on unemployment patterns, wage distributions, adjustment burdens, intergenerational welfare gaps, and trade policy formation. Any serious study of this literature should begin with this volume."—James R. Tybout, Pennsylvania State University"This is an important and timely volume. The quality of scholarship in these papers is of a consistently high standard, and readers will not only find the individual papers analytically rich but also accessible. The economics profession has finally recognized just what a central issue trade with unemployment is—Davidson and Matusz recognized it twenty years ago and have been building tractable models that have yielded important insights."—David Greenaway, University of NottinghamTable of ContentsPREFACE ix ACKNOWLEDGMENTS xv CHAPTER 1: Our Motivation 1 PART 1: NEW INSIGHTS FROM "OLD" TRADE THEORY 25 Introduction to Part 1 27 CHAPTER 2: The Structure of Simple General Equilibrium Models with Frictional Unemployment 33 CHAPTER 3: Trade and Search-Generated Unemployment 60 PART 2: COMPLICATIONS 91 Introduction to Part 2 93 CHAPTER 4: Multiple Free Trade Equilibria in Micro Models of Unemployment 97 CHAPTER 5: Jobs and Chocolate: Samuelsonian Surpluses in Dynamic Models of Unemployment 110 CHAPTER 6: Long-Run Lunacy, Short-Run Sanity: A Simple Model of Trade with Labor Market Turnover 138 PART 3: EMPIRICS 159 Introduction to Part 3 161 CHAPTER 7: Trade and Turnover: Theory and Evidence 165 CHAPTER 8: Trade, Turnover, and Tithing 195 PART 4: ADJUSTMENT COSTS AND POLICY ISSUES 221 Introduction to Part 4 223 CHAPTER 9: Should Policy Makers Be Concerned about Adjustment Costs? 227 CHAPTER 10: An Overlapping-Generations Model of Escape Clause Protection 265 CHAPTER 11: Trade Liberalization and Compensation 292 CHAPTER 12: Can Compensation Save Free Trade? 321 PART 5: NEW INSIGHTS FROM "NEW" TRADE THEORY 349 Introduction to Part 5 351 CHAPTER 13: Globalization and Firm-Level Adjustment with Imperfect Labor Markets 355 CHAPTER 14: Outsourcing Peter to Pay Paul: High-Skill Expectations and Low-Skill Wages with Imperfect Labor Markets 388 INDEX 407
£76.50
Princeton University Press How China Grows Investment Finance and Reform
Book SynopsisIs China's growth sustainable, or has China relied too much on investment, which is subject to diminishing returns, and not enough on technological change? Dealing with the relation between investment, finance, and growth in China, this book dismisses this concern.Trade Review"Using rich and much updated graphs and tables, the authors convincingly argue that China's spectacular growth has been driven mainly by its ability to channel domestic and foreign savings into restructuring its economy since the late 1970s."--G.J. Wen, Choice "Some parts of this work, especially the equation-heavy chapter on savings processes and investment rates, are best appreciated by those with solid economics backgrounds, but even non-experts interested in China's growth will appreciate the arguments made here."--Marc Lanteigne, International Affairs "Overall, this is a very valuable book which systematically examines and analyzes the relationship between investment and growth in China over the past three decades. Using rich and up-to-date data and materials, it argues convincingly that China's spectacular growth has been driven mainly by its ability to channel domestic and foreign savings into restructuring its economy since 1978... This book not only contributes to the existing academic literature in development finance but also provides valuable policy suggestions on China's financial sector reform and liberalization. Although it includes some technical economic analysis, it is written in a way that is easy to read and to understand. It is accessible to a broad range of readers, including academics, policy-makers, business people, students and non-economists. The book will benefit anyone who is interested in development finance in general and in China's economic growth and financial market development in particular."--Chunlai Chen, The China Journal "The book is accessible and informative to a broad readership: from a lay reader to those who work in the field of finance and development, China specialists and policy makers."--Yu Chen, Progress in Development Studies "The book does not break new ground, but its conceptual approach, its empirical analysis and its detailed up-to-date account of the ongoing reform programs and their policy background in China make it highly recommended for those working on or studying the Chinese economy. The book is especially useful for those interested in financial sector reform in China. As claimed by the authors, policy-makers in China will also find this book useful."--Ligang Song, Economic Record "It is an excellent overview of the development of the financial system to date... What is new and surprising is how succinctly and effectively the authors have brought together the technical literature with laymen's language to make this argument. It is one of the best treatises I have seen on financial reform."--Doug Guthrie, China Quarterly "This book will be well received by researchers and policy makers. The focus of the book--how the Chinese economy has grown so far, and whether or not this growth will be sustainable--is an attractive topic given the great importance of the Chinese economy in the world, but also because the authors of the book provide an unconventional method of analysis."--Asian Affairs "Although it includes some technical economic analysis, How China Grows is accessible to noneconomists and will benefit anyone who is interested in development finance in general and in China's economic growth in particular whether economists, political scientists, bankers, or business people."--World Book IndustryTable of ContentsPreface ix Acknowledgments xi Chapter 1: Overview of Economic Reforms and Outcomes 1 1.1 Agricultural Reform: 1979-85 4 1.2 Industrial Reform: 1978-93 6 1.3 Transition to a Market Economy: 1994-2003 11 1.4 Foreign Trade and Investment 13 1.5 Financial Sector 16 Chapter 2: The Source of Growth and the Role of Investment 18 2.1 Methodology of Growth Accounting 18 2.2 Measurement of TFPG in China 20 2.3 Production Function Estimates of TFPG in China 23 2.4 Explaining TFPG in China 25 2.5 The Contribution of Investment Reconsidered 28 2.6 Technological Change Reconsidered 32 2.7 Postscript: Investment versus Domestic Demand as a Source of Growth 35 Chapter 3: Saving and the Financing of Investment in China 36 3.1 Investment 38 3.2 Financing Investment 42 3.3 Financial Flows between Sectors 45 3.4 Household Saving 47 3.5 Government Saving and Investment 54 3.6 Foreign Saving 60 3.7 Summary and Conclusions 65 Chapter 4: Financial Sector Repression 70 4.1 Why Repress the Financial System? 71 4.2 How Repressed Is China's Financial System? 74 4.3 Finance and Growth in China 84 4.4 Strategy of Financial Development 90 Chapter 5: Banking Sector Reform 93 5.1 Key Features of the Banking Sector 93 5.2 Problems of the Banking Sector 95 5.3 Measures Taken to Strengthen the Banking Sector 101 Chapter 6: Developments in the Bond Market 115 6.1 The Role of a Bond Market 115 6.2 The Bond Market in China 116 6.3 Government Bonds 118 6.4 Corporate Bond Market 131 6.5 Conclusion 132 Chapter 7: The Rise and Fall of the Stock Market 134 7.1 The Rise 135 7.2 The Fall 140 7.3 Conclusion 148 Chapter 8: Macroeconomic Policy and Performance 150 8.1 Ups and Downs in the Macro Economy 151 8.2 Investment Spending as the Proximate Cause of Macroeconomic Cycles 152 8.3 Anatomy of Macro Cycles in China 155 8.4 Monetary Policy 165 8.5 Capital Flows and Exchange Rate Policy 171 8.6 Fiscal Policy 179 8.7 Conclusion 186 References 189 Index 199
£63.00
Princeton University Press Microeconomics
Book SynopsisPresents an introduction to modern microeconomic theory. This book develops a theory of how economic institutions shape individual behavior, and how institutions evolve due to individual actions, technological change, and chance events. It addresses institutional innovation, social preferences, nonmarket social interactions, and social capital.Trade Review"There must be dozens of introductory books with the word 'microeconomics' in the title, but for ambition alone Samuel Bowles's volume stands out. Not only does Bowles convey the elements of the conventional theory of capitalist economics--he offers a wealth of cutting-edge material as well ... [His] theory is neat, thought-provoking, and highly original--as is much else in this most unusual take on microeconomics."--Eric Maskin, Science "This important and highly impressive volume is intended as an overview of cutting-edge developments in microeconomics for graduate students... The work is well written and carefully structured... [T]his is a very fertile and inspiring book, of much broader use than its intended audience... Its analytical accounts of institutional structures and its masterly fusion of institutional and evolutionary themes might eventually warrant its status as a modern classic."--Geoffrey M. Hodgson, Economics and PhilosophyTable of ContentsPreface ix Prologue: Economics and the Wealth of Nations and People 1 Part I: Coordination and Conflict: Generic Social Interactions 21 Chapter One: Social Interactions and Institutional Design 23 Chapter Two: Spontaneous Order: The Self-organization of Economic Life 56 Chapter Three: Preferences and Behavior 93 Chapter Four: Coordination Failures and Institutional Responses 127 Chapter Five: Dividing the Gains to Cooperation: Bargaining and Rent Seeking 167 Part II : Competition and Cooperation: The Institutions of Capitalism 203 Chapter Six: Utopian Capitalism: Decentralized Coordination 205 Chapter Seven: Exchange: Contracts, Norms, and Power 233 Chapter Eight: Employment, Unemployment, and Wages 267 Chapter Nine: Credit Markets, Wealth Constraints, and Allocative Inefficiency 299 Chapter Ten: The Institutions of a Capitalist Economy 331 Part III: Change: The Coevolution of Institutions and Preferences 363 Chapter Eleven: Institutional and Individual Evolution 365 Chapter Twelve: Chance, Collective Action, and Institutional Innovation 402 Chapter Thirteen: The Coevolution of Institutions and Preferences 437 Part IV: Conclusion 471 Chapter Fourteen: Economic Governance: Markets, States, and Communities 473 Problem Sets 502 Additional Readings 529 Works Cited 537 Index 571
£63.00
Princeton University Press From Neighborhoods to Nations
Book SynopsisExplores theoretical and empirical tools that economists use to investigate social interactions, and shows how a familiarity with these tools is essential for interpreting findings. This title examines how researchers address the challenge of separating personal, social, and cultural forces from economic ones.Trade Review"[T]his is a very nice book on a very complex and wide topic. To analyze urban economics, network economics, labor economics and growth together, both from a theoretical and empirical perspective, is really remarkable."--Yves Zenou, Journal of Economic Geography "Ioannides should be praised to have written a stimulating book that tries to interrelate social and spatial levels of complex economic phenomena. It is worth noting that this is something that should have more followers also in econometrics."--Andreas Koch, JASSSTable of ContentsPreface xi Chapter 1 Introduction 1 *1.1 From Urban Externalities to Urban Interactions 2 *1.2 Economies of Cities and New Economic Geography 6 *1.3 Urban Structure and Growth 8 *1.4 Urban Interactions, Politics, andUrban Design 9 *1.5 Moving Forward 9 Chapter 2 Social Interactions: Theory and Empirics 11 *2.1 Introduction 11 *2.2 A Simple Linear Model 14 *2.3 Endogenous Social Structure 22 *2.4 Nonlinear Models 30 *2.5 Why Experimental Data Can Help 38 *2.6 Endogenous Social Structure Revisited: Dynamics 44 *2.7 Econometrics of Social Interactions in Social Networks 53 *2.8 Spatial Econometrics Models as Social Interactions Models 61 *2.9 Social Learning in Urban Settings 64 *2.10 Conclusions 66 *2.11 Highlights of the Literature and Further Study 67 *2.12 Appendix: Basic Facts of Graph and Network Theory for Social Network Modeling 68 *2.13 Appendix: Survey of Micro Data Sources with Rich Contextual Information 71 Chapter 3 Location Decisions of Individuals and Social Interactions 79 *3.1 Introduction 79 *3.2 Aspatial Models of Location with Social Interactions 82 *3.3 An Exact Solution for Hedonic Prices in a Model of Sorting 88 *3.4 A Discrete Location Problem with Endogenous and Contextual Effects 95 *3.5 Endogenous Neighborhood Choice and Contextual Effects in Housing Decisions 97 *3.6 Spatial Clustering and Demographic Characteristics: Schelling's Models 115 *3.7 Hierarchical Models of Community Choice with Social Interactions 126 *3.8 Conclusion 134 *3.9 Appendices 135 Chapter 4 Location Decisions of Firms and Social Interactions 148 *4.1 Introduction 148 *4.2 Models of Location of Firms 150 *4.3 Location of Firms under Uncertainty 153 *4.4 Testing for Agglomeration 158 *4.5 Other Approaches to Studying Agglomeration Economies 169 *4.6 Empirical Evidence on Urbanization (Jacobs) Externalities: A Look from the Total Factor Productivity of Firms 180 *4.7 The Role of Inputs and Geography in Location Decisions of Firms 183 *4.8 Economic Geography Models for Firms' Location Decisions 188 *4.9 Risk Pooling by Firms in the Urban Economy 192 *4.10 Conclusion 198 Chapter 5 Social Interactions and Urban Spatial Equilibrium 200 *5.1 Introduction 200 *5.2 Urban Spatial Equilibrium with Social Interactions 206 *5.3 Location Decisions of Firms in Urban Space 212 *5.4 Monocentric versus Polycentric Models of the Urban Economy 217 *5.5 The Lucas-Rossi-Hansberg Models ofUrban Spatial Structure with Productive Externalities 219 *5.6 Neighborhood Effects and theGeometry of the Canonical Urban Model 226 *5.7 Transmission of Job-Related Information and Urban Equilibrium 234 *5.8 Choice of Job Matching and Spatial Structure 240 *5.9 Conclusions 246 Chapter 6 Social Interactions and Human Capital Spillovers 248 *6.1 Introduction 248 *6.2 Spatial Equilibrium 251 *6.3 Spatial Interactions and Spatial Economic Activity 253 *6.4 The Urban Wage Premium and Spatial Equilibrium 259 *6.5 Social Interactions and Human Capital Accumulation 268 *6.6 Social Interactions in Synthetic Neighborhoods 284 *6.7 Conclusions 286 *6.8 Guide to the Literature: Chapters 3-6 287 Chapter 7 Specialization, Intercity Trade, and Urban Structure 292 *7.1 Introduction 292 *7.2 Empirical Evidence on Urban Specialization and Diversification 294 *7.3 Simple Economics of Urban Specialization 297 *7.4 Specialization, Diversification, and Intercity Trade 306 *7.5 Equilibrium Urban Structure with Intercity Trade 318 *7.6 Richer Urban Structures 323 *7.7 The Role of Geography 326 *7.8 Labor Market Frictions in a System of Cities 330 *7.9 Modeling Lessons from the Empirics of Urban Specialization and Diversification 344 *7.10 Summary and Conclusions 346 Chapter 8 Empirics of the Urban Structure and Its Evolution 349 *8.1 Introduction 349 *8.2 Zipf's Law for Cities 350 *8.3 The Duranton Model of Endogenous City Formation 364 *8.4 The Hierarchy Principle 368 *8.5 Cities versus Metropolitan Areas versus Urban Places versus Densities versus Clusters 371 *8.6 Evolving Urban Structures with General Intradistribution Dependence 379 *8.7 Geography and Spatial Clustering 390 *8.8 Studies of Urban Structure Based on "Quasi-Natural Experiments" 393 *8.9 Global Aspects of City Size Distribution and Its Evolution 395 *8.10 Conclusion 396 Chapter 9 Intercity Trade and Long-Run Urban Growth 398 *9.1 Introduction 398 *9.2 Growth of Isolated Cities 401 *9.3 A Ventura-Type Model of Intercity Trade and Economic Growth 409 *9.4 Growth in an Economy of AutarkicCities 412 *9.5 Economic Integration, Urban Specialization, and Growth 420 *9.6 The Rossi-Hansberg-Wright Model of Urban Structure and Its Evolution 429 *9.7 Empirical Aspects of Urban Structure and Long-Run Urban Growth 434 *9.8 Sequential Urban Growth and Decay 440 *9.9 "Space: The Final Frontier?" 444 *9.10 Why Does a City Grow? 447 *9.11 Guide to the Literature for Chapters 7-9 448 Chapter 10 Urban Magic: Concluding Remarks 451 *10.1 Networks, Urban Infrastructure, and Social Interactions 452 *10.2 Graphs and the City 454 Notes 457 Bibliography 483 Index 517
£67.50
Princeton University Press An Introduction to Methods and Models in Ecology
Book SynopsisIntroduces undergraduate students to quantitative models and methods in ecology, behavioral ecology, evolutionary biology, and conservation. This title explores the core concepts shared by these related fields using tools and practical skills such as experimental design, generating phylogenies, basic statistical inference, and grant writing.Trade Review"Braude and Low provide a survey of a wide variety of extended exercises in evolutionary biology, population ecology, population genetics, and statistical analysis. Individual chapters can also serve as useful supplement assignments in many introductory biology courses."--Choice "[This book] is for people like me--faculty members who will buy it and then tinker with, modify, adapt, or steal outright the exercises it contains for use in their own relatively narrowly focused courses. And that is actually a valuable contribution to American biological education!"--Arthur M. Shapiro, Quarterly Review of Biology "I liked An Introduction to Methods and Models in Ecology, Evolution, and Conservation Biology, and think it would be a very good text in the classroom. This book is intended to function as a lab book, teaching students topics conceptually, encouraging users to work out expectations by hand and by sketching out expected outcomes."--J. Michael Reed, Ecology "I liked An Introduction to Methods and Models in Ecology, Evolution, and Conservation Biology and think it would be a very good text in the classroom. [The book] presents a nice selection of problems across the broad topics covered."--J. Michael Reed, Ecological Society of America "[A]n excellent source of tools and inspiration and well suited to prepare the undergraduate student for the methodological and numerical approaches used in ecology and evolution."--Yann Clough, Basic and Applied Ecology "The most enjoyable aspect of this book is that it is a true teaching guide. The authors expose students to quantitative methods using a very hands-on approach. This approach ensures students feel more comfortable with data analysis and quantitative methods, while also aiding them to develop critical thinking and problem-solving skills. A wealth of personal experience as a student and teacher has obviously gone into the creation of this book, and I would highly recommend it to educators dealing with components of this text"--.Brad J. Farmilo, Austral EcologyTable of ContentsFigures vii Tables xi Preface xv Acknowledgments xvii Introduction xix Section I: E volutionary Biology Chapter 1: Evolution and Pesticide Resistance: Examining Quantitative Trends Visually by Stanton Braude and John Gaskin 3 Chapter 2: Lizard Ecomorphology: Generating and Testing Hypotheses of Adaptation by Kenneth H. Kozak 12 Chapter 3: Phylogenetic Inference: Examining Morphological and Molecular Datasets by James Beck 22 Chapter 4: Life History Tradeoffs in Avian Clutch Size: Interpreting Life History Data and Evaluating Alternative Hypotheses by Jon Hess 36 Chapter 5: Mimicry: Experimental Design and Scientific Logic by James Robertson 51 Section II: D emography and Population Ecology Chapter 6: Life Table Analysis by Stanton Braude 63 Chapter 7: Lotka-Volterra Competition Modeling by Stanton Braude, Tara Scherer, and Rebecca McGaha 69 Chapter 8: Explosive Population Growth and Invasive Exotic Species by Jon Hess and James Robertson 79 Chapter 9: Island Biogeography: Evaluating Correlational Data and Testing Alternative Hypotheses by James Robertson 91 Section III: Population Genetics Chapter 10: Hardy-Weinberg: Evaluating Disequilibrium Forces by Jason J. Kolbe 107 Chapter 11: Drift, Demographic Stochasticity, and Extinction in Woggles by James Robertson, Anton Weisstein, and Stanton Braude 117 Chapter 12: Conservation of Small Populations: Effective Population Sizes, Inbreeding, and the 50/500 Rule by Luke J. Harmon and Stanton Braude 125 Chapter 13: Dispersal and Metapopulation Structure by James Robertson 139 Section IV: Quantitative Ecological Tools Chapter 14: Understanding Descriptive Statistics by Beth Sparks-Jackson and Emily Silverman 155 Chapter 15: Understanding Statistical Inference by Emily Silverman and Beth Sparks-Jackson 179 Chapter 16: Sampling Wild Populations by Stanton Braude and James Robertson 189 Chapter 17: Quantifying Biodiversity by Cawas Behram Engineer and Stanton Braude 198 Chapter 18: Environmental Predictability and Life History by Bobbi S. Low and Stanton Braude 214 Chapter 19: Modeling Optimal Foraging by Stanton Braude and James Robertson 226 Section V: S ynthetic Exercises and Writing Assignments Chapter 20: Evaluating Competing Hypotheses of Regional Biodiversity by Stanton Braude 235 Chapter 21: Preparing and Evaluating Competitive Grant Proposals for Conservation Funding by Stanton Braude 239 Chapter 22: Tracing the History of Scientific Ideas: From Darwin, Connell, or Soule to the Present by Bobbi S. Low 245 Glossary 251 Contributors 263 Index 265
£45.00
Princeton University Press Portfolio Risk Analysis
Book SynopsisPresents an overview of financial risk modeling, with a focus on practical applications, empirical reality, and historical perspective. Covering the mean-variance analysis and the capital asset pricing model, this title offers an account of factor models, which are the key to successful risk analysis in every economic climate.Trade Review"Thorough and well-cited, this is a comprehensive treatment of techniques for portfolio risk management. It provides a unique perspective, from the fundamentals to practical applications. There are few books that cover this material in this particular way."—Christopher L. Culp, author of Structured Finance and Insurance"The range of topics is wide and the coverage is deep. An impressive book."—Peter Christoffersen, McGill University"The conceptual framework of this book is presented in a lucid and clear manner. The treatment is mathematically rigorous where it matters, without ever becoming pedantic and without cutting corners."—Riccardo Rebonato, Royal Bank of Scotland"This book takes major steps forward in the crucially important area of portfolio risk measurement, making significant strides toward incorporating industry and country risk, as well as macroeconomic, FX, credit, transactions cost, and liquidity risks. It will be an essential reference text for academics, central bankers, and others in the financial services industry."—Francis X. Diebold, University of PennsylvaniaTable of ContentsAcknowledgments xi Introduction xiii Key Notation xix Chapter 1: Measures of Risk and Return 1 1.1 Measuring Return 1 1.2 The Key Portfolio Risk Measures 6 1.3 Risk-Return Preferences and Portfolio Optimization 12 1.4 The Capital Asset Pricing Model and Its Applications to Risk Analysis 23 1.5 The Objectives and Limitations of Portfolio Risk Analysis 31 Chapter 2: Unstructured Covariance Matrices 36 2.1 Estimating Return Covariance Matrices 36 2.2 The Error-Maximization Problem 47 2.3 Portfolio Choice as Decision Making under Uncertainty 54 Chapter 3: Industry and Country Risk 61 3.1 Industry-Country Component Models 61 3.2 Empirical Evidence on the Relative Magnitudes of Country and Industry Risks 73 3.3 Sector-Currency Models of Corporate Bond Returns 77 Chapter 4: Statistical Factor Analysis 79 4.1 Types of Factor Models 79 4.2 Approximate Factor Models 82 4.3 The Arbitrage Pricing Theory 86 4.4 Small-n Estimation Methods 88 4.5 Large-n Estimation Methods 93 4.6 Number of Factors 98 Chapter 5: The Macroeconomy and Portfolio Risk 101 5.1 Estimating Macroeconomic Factor Models 101 5.2 Event Studies of Macroeconomic Announcements 110 5.3 Macroeconomic Policy Endogeneity 112 5.4 Business Cycle Betas 115 5.5 Empirical Fit and the Relative Value of Macroeconomic Factor Models 116 Chapter 6: Security Characteristics and Pervasive Risk Factors 117 6.1 Equity and Fixed-Income Characteristics 117 6.2 Characteristic-Based Factor Models of Equities 122 6.3 The Fama-French Model and Extensions 130 6.4 The Semiparametric Approach to Characteristic-Based Factor Models 132 Chapter 7: Measuring and Hedging Foreign Exchange Risk 134 7.1 Definitions of Foreign Exchange Risk 134 7.2 Optimal Currency Hedging 142 7.3 Currency Covariances with Stock and Bond Returns 149 7.4 Macroeconomic Influences on Currency Returns 151 Chapter 8: Integrated Risk Models 155 8.1 Global and Regional Integration Trends 155 8.2 Risk Integration across Asset Classes 158 8.3 Segmented Asset Allocation and Security Selection 159 8.4 Integrated Risk Models 162 Chapter 9: Dynamic Volatilities and Correlations 167 9.1 GARCH Models 167 9.2 Stochastic Volatility Models 178 9.3 Time Aggregation 180 9.4 Downside Correlation 181 9.5 Option-Implied Volatility 184 9.6 The Volatility Term Structure at Long Horizons 187 9.7 Time-Varying Cross-Sectional Dispersion 188 Chapter 10: Portfolio Return Distributions 191 10.1 Characterizing Return Distributions 191 10.2 Estimating Return Distributions 196 10.3 Tail Risk 203 10.4 Nonlinear Dependence between Asset Returns 207 Chapter 11: Credit Risk 212 11.1 Agency Ratings and Factor Models of Spread Risk 213 11.2 Rating Transitions and Default 217 11.3 Credit Instruments 218 11.4 Conceptual Approaches to Credit Risk 220 11.5 Recovery at Default 232 11.6 Portfolio Credit Models 232 11.7 The 2007-8 Credit-Liquidity Crisis 238 Chapter 12: Transaction Costs and Liquidity Risk 241 12.1 Some Basic Terminology 241 12.2 Measuring Transactions Cost 246 12.3 Statistical Properties of Liquidity 261 12.4 Optimal Trading Strategies and Transaction Costs 266 Chapter 13: Alternative Asset Classes 271 13.1 Nonsynchronous Pricing and Smoothed Returns 271 13.2 Time-Varying Risk, Nonlinear Payoff, and Style Drift 284 13.3 Selection and Survivorship Biases 291 13.4 Collectibles: Measuring Return and Risk with Infrequent and Error-Prone Observations 295 13.5 Summary 298 Chapter 14: Performance Measurement 299 14.1 Return-Based Performance Measurement 299 14.2 Holdings-Based Performance Measurement and Attribution 303 14.3 Volatility Forecast Evaluation 309 14.4 Value-at-Risk Hit Rates 316 14.5 Forecast and Realized Return Densities 317 Chapter 15: Conclusion 319 15.1 Some Key Messages 319 15.2 Questions for Future Research 320 References 323 Index 345
£117.30
Princeton University Press Quantitative Management of Bond Portfolios
Book SynopsisThe practice of institutional bond portfolio management has changed markedly since the late 1980s in response to new financial instruments, investment methodologies, and improved analytics. Investors are looking for a more disciplined, quantitative approach to asset management. Here, five top authorities from a leading Wall Street firm provide practical solutions and feasible methodologies based on investor inquiries. While taking a quantitative approach, they avoid complex mathematical derivations, making the book accessible to a wide audience, including portfolio managers, plan sponsors, research analysts, risk managers, academics, students, and anyone interested in bond portfolio management. The book covers a range of subjects of concern to fixed-income portfolio managers--investment style, benchmark replication and customization, managing credit and mortgage portfolios, managing central bank reserves, risk optimization, and performance attribution. The first part coTrade Review"This Wall Street research team has become the recognized authority in quantitative approaches to managing bond portfolios, having worked with investors over many years and in many market environments. Their book is well organized, informative, and readable. I highly recommend it to anyone interested in investment management, regardless of their quantitative background."—Keith Anderson, Chief Investment Officer for Fixed Income, BlackRock"I've always been a huge fan of the authors' work. This is their best yet and a 'must read' for anyone interested in bond portfolio management. The authors go beyond the numbers, delving into the issues of portfolio design crucial to the practitioner."—Kenneth S. Leech, Chief Investment Officer, Western Asset Management Company"This team combines intuition with strong empirical research. The greatest achievement of this book is the recognition that very often a portfolio's structure matters as much as its strategies. If you are looking for ways to outperform your benchmarks and competitors, this is a great starting point."—Emanuele Ravano, Co-Head of Portfolio Management, PIMCO Europe"This is the most comprehensive treatment of the analysis of fixed-income strategies for professional asset managers. The coverage is broad and authoritative, with a clear focus on risk and performance relative to benchmarks, across a range of markets. Anyone managing bond portfolios should have a copy."—J. Darrell Duffie, Stanford University"Written by the leading minds in quantitative fixed-income portfolio management, this book offers an excellent, accessible guide to sources of superior returns and methods for analyzing portfolio risk and performance."—William N. Goetzmann, Yale University"No single currently available book serves the needs of a person who seeks a fuller understanding of the quantitative management of bond portfolios. This book is exactly what I have been looking for. Not only is there a need for it among students, educators, and professionals, but it also has the potential to influence academic thought by exposing academics to some of the best practices on the street."—Ravi Jagannathan, Kellogg School of Management, Northwestern University"This is a very useful addition to the bond literature, produced by the premier bond group on Wall Street. The chapters cover a wide range of issues that will be of interest to academics who teach and research securities markets, and they are well written. Bond traders, fund managers, and other investment banking professionals will want this book."—Simon Benninga, Tel Aviv University and the Wharton School, author of Financial Modeling and Principles of Finance with ExcelTable of ContentsForeword by Steve Ross ix Acknowledgments xi Note on Authorship xiii Introduction xv PART I: Empirical Studies of Portfolio Strategies and Benchmark Design EVALUATING INVESTMENT STYLE 3 1. Value of Security Selection vs. Asset Allocation in Credit Markets 9 2. Value of Skill in Macro Strategies for Global Fixed-Income Investing 52 3. Cost of the No-Leverage Constraint in Duration Timing 109 INDEX REPLICATION 121 4. Replicating the Lehman Brothers U.S. Aggregate Index with Liquid Instruments 133 5. Replicating the Lehman Brothers Global Aggregate Index with Liquid Instruments 163 6. Tradable Proxy Portfolios for the Lehman Brothers MBS Index 188 7. High Yield Index Replication 215 8. CMBS Index Replication 225 BENCHMARK CUSTOMIZATION 235 9. Evaluating Performance of Long-Horizon Portfolios 241 10. Liability-Based Benchmarks: An Example 283 11. Swap Indices 294 12. Benchmarks for Asset-Swapped Portfolios 317 13. Issuer-Capped and Downgrade-Tolerant U.S. Corporate Indices 327 MANAGING CREDIT PORTFOLIOS 353 14. Sufficient Diversification in Credit Portfolios 363 15. Return Performance of Investment-Grade Bonds after Distress 410 16. Optimal Credit Allocation for Buy-and-Hold Investors 430 17. A Quick Look at Index Tails 465 18. Are Credit Markets Globally Integrated? 475 MANAGING MORTGAGE PORTFOLIOS 499 19. Managing against the Lehman Brothers MBS Index: Prices and Returns 503 20. Evaluating Measures of MBS Duration 519 21. MBS Investing over Long Horizons 556 MANAGING CENTRAL BANK RESERVES 579 22. Total Return Management of Central Bank Reserves 583 23. The Prospects of Negative Annual Total Returns in Short-Duration Treasury Benchmarks 621 PART II: Portfolio Management Tools OPTIMAL RISK BUDGETING WITH SKILL 631 24. Effect of Security Selection Skill on Optimal Sector Allocation 641 25. Risk Budget Allocation to Issuer and Sector Views 655 MULTIFACTOR RISK MODELING AND PERFORMANCE ATTRIBUTION 677 26. The Global Risk Model: A Portfolio Manager's Guide 681 27. The Hybrid Performance Attribution Model 788 PORTFOLIO AND INDEX ANALYTICS 811 28. Insights on Duration and Convexity 817 29. Portfolio Yields and Durations 825 30. Computing Excess Return of Spread Securities 842 31. Currency-Hedged Returns in Fixed-Income Indices 854 32. The Bund-Treasury Trade in Portfolios 862 33. Empirical Duration of Credit Securities 871 34. Duration Times Spread: A New Measure of Spread Risk for Credit Securities 888 35. Hedging Debt with Equity 935
£127.50
Princeton University Press The Known the Unknown and the Unknowable in
Book SynopsisIntroduces a more realistic and holistic framework called KuU - the Known, the unknown, and the Unknowable - that enables one to conceptualize the different kinds of financial risks and design effective strategies for managing them.Trade ReviewWinner of the 2012 Kulp-Wright Book Award, American Risk and Insurance Association Finalist for the 2010 Paul A. Samuelson Award, TIAA-CREF "It is a bold book, tackling both theory and practice and spanning the worlds of (among others) banking, insurance, real estate, and investment. It is also utterly engrossing... Although this book is most obviously addressed to risk managers and regulators, I think it should be read by every intellectually curious person with skin in the financial game. If the investor or trader doesn't come away with at least one or two ideas of practical importance to his financial life, he is a 'sleepreader.'"--Brenda Jubin, Reading the Markets blog "Peppered with anecdotes and prominent examples, the book never abandons the practical side of its topic. It will be helpful for readers interested in only specific subtopics that each article is a stand-alone piece. I recommend this book to a wide audience: academics and practitioners, of course, but even people who are not directly involved in the financial sector, but are interested in it, will find it definitely worth their time."--Tobias Nigbur, Financial Markets and Portfolio ManagementTable of ContentsPreface vii Chapter 1: Introduction by Francis X. Diebold, Neil A. Doherty, and Richard J. Herring 1 Chapter 2: Risk: A Decision Maker's Perspective by Sir Clive W. J. Granger 31 Chapter 3: Mild vs. Wild Randomness: Focusing on Those Risks That Matter by Benoit B. Mandelbrot and Nassim Nicholas Taleb 47 Chapter 4: The Term Structure of Risk, the Role of Known and Unknown Risks, and Nonstationary Distributions by Riccardo Colacito and Robert F. Engle 59 Chapter 5: Crisis and Noncrisis Risk in Financial Markets: A Unified Approach to Risk Management by Robert H. Litzenberger and David M. Modest 74 Chapter 6: What We Know, Don't Know, and Can't Know about Bank Risk: A View from the Trenches by Andrew Kuritzkes and Til Schuermann 103 Chapter 7: Real Estate through the Ages: The Known, the Unknown, and the Unknowable by Ashok Bardhan and Robert H. Edelstein 145 Chapter 8: Reflections on Decision-making under Uncertainty by Paul R. Kleindorfer 164 Chapter 9: O n the Role of Insurance Brokers in Resolving the Known, the Unknown, and the Unknowable by Neil A. Doherty and Alexander Muermann 194 Chapter 10: Insuring against Catastrophes by Howard Kunreuther and Mark V. Pauly 210 Chapter 11: Managing Increased Capital Markets Intensity: The Chief Financial Officer's Role in Navigating the Known, the Unknown, and the Unknowable by Charles N. Bralver and Daniel Borge 239 Chapter 12: The Role of Corporate Governance in Coping with Risk and Unknowns by Kenneth E. Scott 277 Chapter 13: Domestic Banking Problems by Charles A. E. Goodhart 286 Chapter 14: Crisis Management: The Known, The Unknown, and the Unknowable by Donald L. Kohn 296 Chapter 15: Investing in the Unknown and Unknowable by Richard J. Zeckhauser 304 List of Contributors 347 Index 359
£76.50
Princeton University Press Entrepreneurship Innovation and the Growth
Book SynopsisHow much credit can be given to entrepreneurship for the unprecedented innovation and growth of free-enterprise economies? This book brings together some of the world's leading economists to tackle this question, and their responses shed light on how free-market economies work - and what policies most encourage their growth.Trade Review"This book brings together an absolutely first-rate group of thinkers, including several Nobel Prize winners, who were invited to a 2003 conference spurred by the publication of William J. Baumol's The Free-Market Innovation Machine. These thought-provoking essays illustrate the potential of Baumol's framework to considerably advance our understanding of what drives entrepreneurship, innovation, and long-term economic growth."—Scott Stern, Northwestern University"This book's remarkable achievement is to gather some of the brightest minds in economics to discuss some of the most important issues in the field—innovation, entrepreneurship, and growth. It is particularly refreshing to see these topics addressed at a variety of levels and from a variety of research perspectives. The combination of microeconomists and macroeconomists, and even economic historians, is a rare instance of communication across the subfields of economics. This impressive book will be useful to both economics generalists and specialists."—Thomas Hellmann, University of British ColumbiaTable of ContentsPreface ix INTRODUCTION by Eytan Sheshinski and Robert J. Strom 1 PART I: INTRODUCTORY: THE MICROECONOMICS AND MACROECONOMICS OF GROWTH Chapter 1: On Macroeconomic Models of Free-Market Innovation and Growth by Robert M. Solow 15 Chapter 2: The Macro-context of the Microeconomics of Innovation by Kenneth J. Arrow 20 PART II: INSTITUTIONAL BASES FOR CAPITALIST GROWTH Introduction and Comments by Michael M. Weinstein 31 Chapter 3: Institutional Bases for Capitalist Growth by Douglass C. North 35 Chapter 4: Capitalism and Economic Liberty: The Political Foundations of Economic Growth by Barry R. Weingast 48 PART III: INNOVATION IN MODERN CORPORATIONS Introduction and Comments by Ying Lowrey 73 Chapter 5: Endogenous Forces in Twentieth-Century America by Nathan Rosenberg 80 Chapter 6: Interfirm Collaboration Networks: The Impact of Network Structure on Rates of Innovation by Melissa A. Schilling and Corey Phelps 100 PART IV: THE CONTINUING ROLE OF INDEPENDENT INNOVATORS AND ENTREPRENEURS Introduction and Comments by Sylvia Nasar 135 Chapter 7: The Small Entrepreneur by Boyan Jovanovic and Peter L. Rousseau 140 Chapter 8: Toward Analysis of Capitalism's Unparalleled Growth: Sources and Mechanism by William J. Baumol 158 PART V: DISSEMINATION OF TECHNOLOGY AND THE PATENT SYSTEM Introduction and Comments by Edward N. Wolff 181 Chapter 9: Patents, Licensing, and Entrepreneurship: Effectuating Innovation in Multi-invention Contexts by Deepak Somaya and David J. Teece 185 Chapter 10: The Market for Technology and the Organization of Invention in U.S. History by Naomi R. Lamoreaux and Kenneth L. Sokoloff 213 PART VI: INNOVATION AND TRADE Introduction and Comments by Yochanan Shachmurove 247 Chapter 11: Innovation and Its Effects on International Trade by Ralph E. Gomory and William J. Baumol 261 Chapter 12: Innovation, Diffusion, and Trade by Jonathan Eaton and Samuel S. Kortum 276 PART VII: FINANCE AND INNOVATION IN THE FREE-MARKET ECONOMY Introduction and Comments by Alan S. Blinder 303 Chapter 13: Radical Financial Innovation by Robert J. Shiller 306 Chapter 14: Finance and Innovation by Burton G. Malkiel 324 PART VIII: TOWARD SOME LESSONS Introduction and Comments by Robert J. Strom 339 Chapter 15: The Economic Performance of Nations: Prosperity Depends on Dynamism, Dynamism on Institutions by Edmund S. Phelps 342 Chapter 16: Pharmaceutical Patenting in Developing Countries and R&D by Eytan Sheshinski 357 Contributors 367 Index 369
£98.10
Princeton University Press The Purchase of Intimacy
Book SynopsisIn their personal lives, people consider it essential to separate economics and intimacy. Challenging this view, this book shows how we use economic activity to create, maintain, and renegotiate important ties, especially intimate ties, to others, thus opening a window on the inner workings of the economic processes that pervade our private lives.Trade Review"Are sociologists today the best economic scientists? On the evidence of Viviana Zelizer's striking book on the mix of the sacred and profane in our lives, it seems so."--Deirdre McCloskey, The Times Higher Education Supplement "Zelizer's book does an excellent job in demystifying the intertwining of economic activity and intimacy."--Xiaoshuo Hou, Theory and Society "The theoretical importance of this book cannot be overstated, and it cannot fail to have a lasting impact on our understanding of a variety of intimate relationships, of the circulation of money, of care, of interest, and mostly of their inextricable intertwining... [T]his book is a major contribution to sociology and ... it provides a very significant challenge to the dichotomies on which sociology rests. The tight elegance of its prose and style will make it a joy to the undergraduate student, while the scope, ambition, and originality of its argument will make it indispensable to scholars."--Eva Illouz, American Journal of Sociology "Zelizer offers a perspective that focuses attention on incomplete commensurability, an essential task where markets and supposedly non market realms intersect. In doing so, Zelizer's approach gives judges, academics, lawyers, and lay people a vantage point on markets and intimacy that reflects how people actually live their lives."--Martha M. Ertman, Law & Social InquiryTable of ContentsAcknowledgments ix Prologue 1 Chapter 1: Encounters of Intimacy and Economy 7 Chapter 2: Intimacy in Law 47 Chapter 3: Coupling 94 Chapter 4: Caring Relations 158 Chapter 5: Household Commerce 209 Chapter 6: Intimate Revelations 287 References 309 Index 347
£999.99
Princeton University Press Services and Employment Explaining the
Book SynopsisWhy is Europe's employment rate almost 10 percent lower than that of the United States? Drawing on the findings of a project that examined data from France, Germany, Netherlands, United Kingdom, and the United States, this work argues that Europe's 25 million "missing" jobs can be attributed almost entirely to its relative lack of service jobs.Trade Review"The significance of this volume for public policy is that the authors' hypotheses offer a rebuttal to the more familiar explanations criticizing European labor laws and social service policies as the rationale for substantial changes in employment in the past few years."--Choice "[I]t becomes apparent from this book, which we would highly recommend reading, that the problem of contemporary developed economies is less their degree of de-industrialisation than their gap in servicisation."--Faiz Gallouj, Journal of Evolutionary Economics "Services and Employment is an impressive and stimulating book that takes an unconventional supply-side oriented look at the employment gap between the USA and Europe and offers theoretical as well as empirical insights."--Engelbert Stockhammer, InterventionTable of ContentsPreface vii Contributors ix Introduction by Mary Gregory, Wiemer Salverda, and Ronald Schettkat 1 Chapter 1: The U.S.-European Gap in Service Employment and Demand: The Research Agenda by Wiemer Salverda and Ronald Schettkat 15 Chapter 2: Reflections on the Rise of Service Sector Employment by Victor R. Fuchs 42 Chapter 3: On Mechanisms Underlying the Growing Share of Service Employment in the Industrialized Economies by William J. Baumol 63 Chapter 4: Do Demand Differences Cause the U.S.-European Employment Gap? by Mary Gregory and Giovanni Russo 81 Chapter 5: Comparative Service Consumption in Six Countries by Adriaan S. Kalwij and Stephen Machin with Laura Blow, Marijke van Deelen, Francois Gardes, Maria-Jose Luengo-Prado, Javier Ruiz-Castillo, John Schmitt, and Christophe Starzec 109 Chapter 6: Employment Differences in Distribution: Wages, Productivity, and Demand by Andrew Glyn, Joachim Moller, Wiemer Salverda, John Schmitt, and Michel Sollogoub 141 Chapter 7: Why Was Europe Left at the Station When America's Productivity Locomotive Departed? by Robert J. Gordon 176 Chapter 8: Can Marketization of Household Production Explain the Jobs Gap Puzzle? by Richard B. Freeman 198 Chapter 9: Service Included? Services and the U.S.-European Employment Gap by Mary Gregory, Wiemer Salverda, and Ronald Schettkat 217 Bibliography 231 List of DEMPATEM Working Papers 241 Index 243
£85.50
Princeton University Press Demographic Forecasting
Book SynopsisMortality forecasting is used in a wide variety of academic fields, and for policymaking in global health, social security and retirement planning, and other areas. This title provides a framework for forecasting age-sex-country-cause-specific variables that makes it possible to incorporate information than standard approaches.Trade Review"A substantial contribution in terms of ideas and methods. This book introduces a new methodology for forecasting mortality that takes into account important predictors, formalizes the use of prior knowledge such as expert opinion, and produces estimates of forecasting uncertainty, using a Bayesian statistical framework. It also provides convincing evidence that the new methods can outperform some of the best alternatives available. The techniques have wide applicability."—Germán Rodríguez, Princeton University"This book is excellent and important."—Ronald Lee, University of California, BerkeleyTable of ContentsList of Figures xi List of Tables xiii Preface xv Acknowledgments xvii Chapter 1: Qualitative Overview 1 1.1 Introduction 1 1.2 Forecasting Mortality 3 1.2.1 The Data 3 1.2.2 The Patterns 5 1.2.3 Scientific versus Optimistic Forecasting Goals 8 1.3 Statistical Modeling 11 1.4 Implications for the Bayesian Modeling Literature 15 1.5 Incorporating Area Studies in Cross-National Comparative Research 16 1.6 Summary 18 Part I Existing Methods for Forecasting Mortality 19 Chapter 2: Methods without Covariates 21 2.1 Patterns in Mortality Age Profiles 22 2.2 A Unified Statistical Framework 24 2.3 Population Extrapolation Approaches 25 2.4 Parametric Approaches 26 2.5 A Nonparametric Approach: Principal Components 28 2.5.1 Introduction 28 2.5.2 Estimation 32 2.6 The Lee-Carter Approach 34 2.6.1 The Model 34 2.6.2 Estimation 36 2.6.3 Forecasting 36 2.6.4 Properties 38 2.7 Summary 42 Chapter 3: Methods with Covariates 43 3.1 Equation-by-Equation Maximum Likelihood 43 3.1.1 Poisson Regression 43 3.1.2 Least Squares 44 3.1.3 Computing Forecasts 46 3.1.4 Summary Evaluation 47 3.2 Time-Series, Cross-Sectional Pooling 48 3.2.1 The Model 48 3.2.2 Postestimation Intercept Correction 49 3.2.3 Summary Evaluation 49 3.3 Partially Pooling Cross Sections via Disturbance Correlations 50 3.4 Cause-Specific Methods with Microlevel Information 51 3.4.1 Direct Decomposition Methods 51 Modeling 51 3.4.2 Microsimulation Methods 52 3.4.3 Interpretation 53 3.5 Summary 53 Part II Statistical Modeling 55 Chapter 4: The Model 57 4.1 Overview 57 4.2 Priors on Coefficients 59 4.3 Problems with Priors on Coefficients 60 4.3.1 Little Direct Prior Knowledge Exists about Coefficients 61 4.3.2 Normalization Factors Cannot Be Estimated 62 4.3.3 We Know about the Dependent Variable, Not the Coefficients 64 4.3.4 Difficulties with Incomparable Covariates 65 4.4 Priors on the Expected Value of the Dependent Variable 65 4.4.1 Step 1: Specify a Prior for the Dependent Variable 66 4.4.2 Step 2: Translate to a Prior on the Coefficients 67 4.4.3 Interpretation 68 4.5 A Basic Prior for Smoothing over Age Groups 69 4.5.1 Step 1: A Prior for 69 4.5.2 Step 2: From the Prior on to the Prior on ss 71 4.5.3 Interpretation 71 4.6 Concluding Remark 73 Chapter 5: Priors over Grouped Continuous Variables 74 5.1 Definition and Analysis of Prior Indifference 74 5.1.1 A Simple Special Case 76 5.1.2 General Expressions for Prior Indifference 76 5.1.3 Interpretation 77 5.2 Step 1: A Prior for 80 5.2.1 Measuring Smoothness 81 5.2.2 Varying the Degree of Smoothness over Age Groups 83 5.2.3 Null Space and Prior Indifference 83 5.2.4 Nonzero Mean Smoothness Functional 85 5.2.5 Discretizing: From Age to Age Groups 85 5.2.6 Interpretation 86 5.3 Step 2: From the Prior on to the Prior on ss 92 5.3.1 Analysis 92 5.3.2 Interpretation 92 Chapter 6: Model Selection 94 6.1 Choosing the Smoothness Functional 94 6.2 Choosing a Prior for the Smoothing Parameter 97 6.2.1 Smoothness Parameter for a Nonparametric Prior 98 6.2.2 Smoothness Parameter for the Prior over the Coefficients 100 6.3 Choosing Where to Smooth 104 6.4 Choosing Covariates 108 6.4.1 Size of the Null Space 109 6.4.2 Content of the Null Space 110 6.5 Choosing a Likelihood and Variance Function 112 6.5.1 Deriving the Normal Specification 112 6.5.2 Accuracy of the Log-Normal Approximation to the Poisson 114 6.5.3 Variance Specification 120 Chapter 7: Adding Priors over Time and Space 124 7.1 Smoothing over Time 124 7.1.1 Prior Indifference and the Null Space 125 7.2 Smoothing over Countries 127 7.2.1 Null Space and Prior Indifference 128 7.2.2 Interpretation 130 7.3 Smoothing Simultaneously over Age, Country, and Time 131 7.4 Smoothing Time Trend Interactions 132 7.4.1 Smoothing Trends over Age Groups 133 7.4.2 Smoothing Trends over Countries 133 7.5 Smoothing with General Interactions 134 7.6 Choosing a Prior for Multiple Smoothing Parameters 136 7.6.1 Example 139 7.6.2 Estimating the Expected Value of the Summary Measures 141 7.7 Summary 144 Chapter 8: Comparisons and Extensions 145 8.1 Priors on Coefficients versus Dependent Variables 145 8.1.1 Defining Distances 145 8.1.2 Conditional Densities 147 8.1.3 Connections to "Virtual Examples" in Pattern Recognition 147 8.2 Extensions to Hierarchical Models and Empirical Bayes 148 8.2.1 The Advantages of Empirical Bayes without Empirical Bayes 149 8.2.2 Hierarchical Models as Special Cases of Spatial Models 151 8.3 Smoothing Data without Forecasting 151 8.4 Priors When the Dependent Variable Changes Meaning 153 Part III Estimation 159 Chapter 9: Markov Chain Monte Carlo Estimation 161 9.1 Complete Model Summary 161 9.1.1 Likelihood 162 9.1.2 Prior for ss 162 9.1.3 Prior for si 162 9.1.4 Prior for T 163 9.1.5 The Posterior Density 164 9.2 The Gibbs Sampling Algorithm 164 9.2.1 Sampling s 165 The Conditional Density 165 Interpretation 165 9.2.2 Sampling T 166 The Conditional Density 166 Interpretation 166 9.2.3 Sampling ss 167 The Conditional Density 167 Interpretation 168 9.2.4 Uncertainty Estimates 169 9.3 Summary 169 Chapter 10: Fast Estimation without Markov Chains 170 10.1 Maximum A Posteriori Estimator 170 10.2 Marginal Maximum A Posteriori Estimator 171 10.3 Conditional Maximum A Posteriori Estimator 172 10.4 Summary 173 Part IV Empirical Evidence 175 Chapter 11: Illustrative Analyses 177 11.1 Forecasts without Covariates: Linear Trends 178 11.1.1 Smoothing over Age Groups Only 178 11.1.2 Smoothing over Age and Time 181 11.2 Forecasts without Covariates: Nonlinear Trends 182 11.3 Forecasts with Covariates: Smoothing over Age and Time 187 11.4 Smoothing over Countries 189 Chapter 12: Comparative Analyses 196 12.1 All Causes in Males 197 12.2 Lung Disease in Males 200 12.2.1 Comparison with Least Squares 202 12.2.2 Country-by-Country Analysis 203 12.3 Breast Cancer in Females 205 12.3.1 Comparison with Least Squares 205 12.3.2 Country-by-country Analysis 205 12.4 Comparison on OECD Countries 206 12.4.1 Transportation Accidents in Males 208 12.4.2 Cardiovascular Disease in Males 210 Chapter 13: Concluding Remarks 211 Appendixes 213 A Notation 215 A.1 Principles 215 A.2 Glossary 216 B Mathematical Refresher 219 B.1 Real Analysis 219 B.1.1 Vector Space 219 B.1.2 Metric Space 220 B.1.3 Normed Space 221 B.1.4 Scalar Product Space 222 B.1.5 Functions, Mappings, and Operators 223 B.1.6 Functional 224 B.1.7 Span 224 B.1.8 Basis and Dimension 224 B.1.9 Orthonormality 225 B.1.10 Subspace 225 B.1.11 Orthogonal Complement 226 B.1.12 Direct Sum 226 B.1.13 Projection Operators 227 B.2 Linear Algebra 229 B.2.1 Range, Null Space, Rank, and Nullity 229 B.2.2 Eigenvalues and Eigenvectors for Symmetric Matrices 232 B.2.3 Definiteness 234 B.2.4 Singular Values Decomposition 234 Definition 234 For Approximation 235 B.2.5 Generalized Inverse 236 B.2.6 Quadratic Form Identity 238 B.3 Probability Densities 239 B.3.1 The Normal Distribution 239 B.3.2 The Gamma Distribution 239 B.3.3 The Log-Normal Distribution 240 C Improper Normal Priors 241 C.1 Definitions 241 C.2 An Intuitive Special Case 242 C.3 The General Case 243 C.4 Drawing Random Samples 246 D Discretization of the Derivative Operator 247 E Smoothness over Graphs 249 Bibliography 251 Index 259
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