Greasing the wheels? The impact of regulations and corruption on firm entry

This paper investigates the question of whether corruption might ‘grease the wheels’ of an economy. We investigate whether and to what extent the impact of regulations on entrepreneurship is dependent on corruption. We first test whether regulations robustly deter firm entry into markets. Our results show that the existence of a larger number of procedures required to start a business, as well as larger minimum capital requirements are detrimental to entrepreneurship. Second, we test whether corruption reduces the negative impact of regulations on entrepreneurship in highly regulated economies. Our empirical analysis, covering a maximum of 43 countries over the 2003–2005 period, shows that corruption facilitates firm entry in highly regulated economies. For example, the ‘greasing’ effect of corruption kicks in at around 50 days required to start a new business. Our results thus provide support for the ‘grease the wheels’ hypothesis.

Lock, stock, and barrel: a comprehensive assessment of the determinants of terror

We assess the robustness of previous findings on the determinants of terrorism. Using extreme bound analysis, the three most comprehensive terrorism datasets, and focusing on the three most commonly analyzed aspects of terrorist activity, i.e., location, victim, and perpetrator, we re-assess the effect of 65 proposed correlates. Evaluating around 13.4 million regressions, we find 18 variables to be robustly associated with the number of incidents occurring in a given country-year, 15 variables with attacks against citizens from a particular country in a given year, and six variables with attacks perpetrated by citizens of a particular country in a given year.

Evaluation of cumulative externality: environmental economics, oligopoly and the private provision of public goods

This paper evaluates environmental externality when the structure of the externality is cumulative. The evaluation exercise is based on the assumption that the agents in question form conjectural variations. A number of environments are encompassed within this classification and have received due attention in the literature. Each of these heterogeneous environments, however, possesses considerable analytical homogeneity and permit subscription to a general model treatment. These environments include environmental externality, oligopoly and the analysis of the private provision of public goods. We highlight the general analytical approach by focusing on this latter context, in which debate centers around four issues: the existence of free-riding, the extent to which contributions are matched equally across individuals, the nature of conjectures consistent with equilibrium, and the allocative inefficiency of alternative regimes. This paper resolves each of these issues, with the following conclusions: A consistent-conjectures equilibrium exists in the private provision of public goods. It is the monopolistic-conjectures equilibrium. Agents act identically, contributing positive amounts of the public good in an efficient allocation of resources. There is complete matching of contributions among agents, no free-riding, and the allocation is independent of the number of members within the community. Thus the Olson conjecture—that inefficiency is exacerbated by community size—has no foundation in a consistent-conjectures, cumulative-externality, context (212 words).

Public values for badgers, bovine TB reduction and management strategies

This paper applies an attribute-based stated choice experiment approach to estimate the value that society places on changes to the size of the badger population in England and Wales. The study was undertaken in the context of a rising incidence of bovine tuberculosis (bTB) in cattle and the government's review of current bTB control policy. This review includes consideration of culling badgers to reduce bTB in cattle, since badgers are thought to be an important wildlife reservoir for the disease. The design of the CE involved four attributes (size of badger population, cattle slaughtered due to bTB, badger management strategy and household tax) at four levels with eight choice sets of two alternatives presented to respondents. Telephone interviews were undertaken with over 400 respondents, which elicited their attitudes and preferences concerning badgers, bTB in cattle and badger management strategies. The study estimated a willingness to pay of 0.10 pound per household per year per 100,000 badgers and 1.52 pound per household per year per 10,000 cattle slaughtered due to bTB which aggregated to 22 per badger and 3298 pound per bTB slaughtered animal for all households in England and Wales. Management strategy toward badgers had a very high valuation, highlighting the emotive issue of badger culling for respondents and the importance of government policy towards badgers.

Healthcare providers in the English National Health Service: public, private or hybrids?

In recent years it has been noted that boundaries between public and private providers of many types of welfare have become blurred. This paper uses three dimensions of publicness to analyse this blurring of boundaries in relation to providers of healthcare in England. The authors find that, although most care is still funded and provided by the state, there are significant additional factors in respect of ownership and social control which indicate that many English healthcare providers are better understood as hybrids. Furthermore, the authors raise concerns about the possible deleterious effects of diminishing aspects of publicness on English healthcare. The most important of these is a decrease in accountability

Public values and community energy: lessons from the US and UK

This paper examines some of the normative aspects of community energy programmes — defined here as decentralized forms of energy production and distributed energy technologies where production decisions are made as close as possible to sources of consumption. Such projects might also display a degree of separation from the formal political process. The development of a community energy system often generates a great deal of debate about both the degree of public support for such programmes and the values around which programmes ought to be organized. Community energy programmes also raise important issues regarding the energy choice problem, including questions of process, that is, by whom a project is developed and the influence of both community and exogenous actors, as well as certain outcome issues regarding the spatial and social distribution of energy. The case studies, drawn from community energy programmes in both the United States and the United Kingdom, allow for a careful examination of all of these factors, considering in particular the complex interplay and juxtaposition between the ideas of 'public value' and 'public values'.

The experimetrics of public goods: inferring motivations from contributions

In public goods experiments, stochastic choice, censoring and motivational heterogeneity give scope for disagreement over the extent of unselfishness, and whether it is reciprocal or altruistic. We show that these problems can be addressed econometrically, by estimating a finite mixture model to isolate types, incorporating double censoring and a tremble term. Most subjects act selfishly, but a substantial proportion are reciprocal with altruism playing only a marginal role. Isolating reciprocators enables a test of Sugden’s model of voluntary contributions. We estimate that reciprocators display a self-serving bias relative to the model.

Interpersonal interaction and economic theory: the case of public goods

Interpersonal interaction in public goods contexts is very different in character to its depiction in economic theory, despite the fact that the standard model is based on a small number of apparently plausible assumptions. Approaches to the problem are reviewed both from within and outside economics. It is argued that quick fixes such as a taste for giving do not provide a way forward. An improved understanding of why people contribute to such goods seems to require a different picture of the relationships between individuals than obtains in standard microeconomic theory, where they are usually depicted as asocial. No single economic model at present is consistent with all the relevant field and laboratory data. It is argued that there are defensible ideas from outside the discipline which ought to be explored, relying on different conceptions of rationality and/or more radically social agents. Three such suggestions are considered, one concerning the expressive/communicative aspect of behaviour, a second the possibility of a part-whole relationship between interacting agents and the third a version of conformism.

Do consumers want public or private bodies to monitor animal friendly production and marketing schemes? And does trust matter?

Producing according to enhanced farm animal welfare (FAW) standards increases costs along the livestock value chain, especially for monitoring certified animal friendly products. In the choice between public or private bodies for carrying out and monitoring certification, consumer preferences and trust play a role. We explore this issue by applying logit analysis involving socio-economic and psychometric variables to survey data from Italy. Results identify marked consumer preferences for public bodies and trust in stakeholders a key determinant.

Public real estate and the term structure of interest rates: a cross-country study

Using a variation of the Nelson-Siegel term structure model we examine the sensitivity of real estate securities in six key global markets to unexpected changes in the level, slop and curvature of the yield curve. Our results confirm the time-sensitive nature of the exposure and sensitivity to interest rates and highlight the importance of considering the entire term structure of interest rates. One issue that is of particular of interest is that despite the 2007-9 financial crisis the importance of unanticipated interest rate risk weakens post 2003. Although the analysis does examine a range of markets the empirical analysis is unable to provide definitive evidence as to whether REIT and property-company markets display heightened or reduced exposure.

Impact of externalities on sustainable development: evidence from public-private partnerships in Kazakhstan and Russia

Purpose – This paper aims to investigate the influence of public-private partnerships (PPPs) on social and economic conditions in Kazakhstan and Russia from a public economics perspective, namely, through the lens of a market failure and PPPs’ negative externalities. Design/methodology/approach – Drawing on the concept of a market failure and using the externalities perspective, the paper investigates whether partnerships are instrumental in solving market problems, which is illustrated by the evidence from ongoing PPP projects in Kazakhstan and Russia. Findings – Results show that citizens face expansion of monopolistic trends in the service provision and decreased availability of public services. Additionally, the government support to partnerships recreates a negative externality in the form of a higher risk premium on loan interest rates that banks use to finance PPPs. The partnerships’ impact on sustainable development often appears detrimental, as they significantly intensify the struggle between sub-national governments for increased transfers from the national budget. Practical implications – The government agencies must incorporate the appraisal of the PPP externalities and their effects on the society in the decision-making regarding the PPP formation. Originality/value – The authors suggest that, although government is interested in PPPs’ positive externalities, in reality many negative externalities may offset the positive spillover effects. As a result, the partnerships’ contributions to economic and social sustainability remain controversial. Extending the value-for-money concept to incorporate the assessment of PPP externalities might significantly enhance the partnership conceptualisation by more comprehensive and accurate assessment of PPPs’ economic and social value.