Voting after the bombing: Can terrorist attacks change the outcome of democratic elections?

Economists have recently turned their attention to the effects of terrorism. One much debated effect of terrorist attacks is its impact on the results of democratic elections. We use the electoral consequences of the terrorist attacks of the 11-M in Madrid to analyze this issue. We consider this particular experiment since the attack took place only three days before the 2004 Congressional Election, which allows the use of credible identification criteria. In particular, we use the advance voting by Spanish residents abroad, who cast their vote before the terrorist attack, to identify the effect of the bombing. We exploit this macabre natural experiment to run a difference-in-differences estimation using data on three consecutive Congressional elections. Our empirical results indicate that a terrorist attack can have a large impact on the outcome of democratic elections.

Organisational values as "attractors of chaos": An emerging cultural change to manage organisational complexity

Business organisations are excellent representations of what in physics and mathematics are designated "chaotic" systems. Because a culture of innovation will be vital for organisational survival in the 21st century, the present paper proposes that viewing organisations in terms of "complexity theory" may assist leaders in fine-tuning managerial philosophies that provide orderly management emphasizing stability within a culture of organised chaos, for it is on the "boundary of chaos" that the greatest creativity occurs. It is argued that 21st century companies, as chaotic social systems, will no longer be effectively managed by rigid objectives (MBO) nor by instructions (MBI). Their capacity for self-organisation will be derived essentially from how their members accept a shared set of values or principles for action (MBV). Complexity theory deals with systems that show complex structures in time or space, often hiding simple deterministic rules. This theory holds that once these rules are found, it is possible to make effective predictions and even to control the apparent complexity. The state of chaos that self-organises, thanks to the appearance of the "strange attractor", is the ideal basis for creativity and innovation in the company. In this self-organised state of chaos, members are not confined to narrow roles, and gradually develop their capacity for differentiation and relationships, growing continuously toward their maximum potential contribution to the efficiency of the organisation. In this way, values act as organisers or "attractors" of disorder, which in the theory of chaos are equations represented by unusually regular geometric configurations that predict the long-term behaviour of complex systems. In business organisations (as in all kinds of social systems) the starting principles end up as the final principles in the long term. An attractor is a model representation of the behavioral results of a system. The attractor is not a force of attraction or a goal-oriented presence in the system; it simply depicts where the system is headed based on its rules of motion. Thus, in a culture that cultivates or shares values of autonomy, responsibility, independence, innovation, creativity, and proaction, the risk of short-term chaos is mitigated by an overall long-term sense of direction. A more suitable approach to manage the internal and external complexities that organisations are currently confronting is to alter their dominant culture under the principles of MBV.

North-south trade and directed technical change

In a world where poor countries provide weak protection for intellectual propertyrights, market integration shifts technical change in favor of rich nations. Throughthis channel, free trade may amplify international income differences. At the sametime, integration with countries where intellectual property rights are weakly protectedcan slow down the world growth rate. A crucial implication of these results is thatprotection of intellectual property is most beneficial in open countries. This prediction,which is novel in the literature, finds support in the data on a panel of 53 countriesobserved in the years 1965-1990.

Skill-biased technological change and the business cycle

Over the past two decades, technological progress in the United States hasbeen biased towards skilled labor. What does this imply for business cycles?We construct a quarterly skill premium from the CPS and use it to identifyskill-biased technology shocks in a VAR with long-run restrictions. Hours fallin response to skill-biased technology shocks, indicating that at least part of thetechnology-induced fall in total hours is due to a compositional shift in labordemand. Skill-biased technology shocks have no effect on the relative price ofinvestment, suggesting that capital and skill are not complementary in aggregateproduction.

Embodied technical change and the fluctuations of wages and unemployment

The paper shows that a matching model where technological change is partially embodied in the job match is successful in explaining the variability of unemployment and vacancies. If we incorporate long-term wage contracts into the model, it also explains a number of stylized facts on the dynamics of real wages, which have been found in the empirical labor literature.

Interest rate restrictions in a natural experiment: loan allocation and the change in the usury laws in 1714

This article studies the effects of interest rate restrictions on loan allocation. The British governmenttightened the usury laws in 1714, reducing the maximum permissible interest rate from 6% to5%. A sample of individual loan transactions reveals that average loan size and minimum loan sizeincreased strongly, while access to credit worsened for those with little social capital. Collateralisedcredits, which had accounted for a declining share of total lending, returned to their former role ofprominence. Our results suggest that the usury laws distorted credit markets significantly; we findno evidence that they offered a form of Pareto-improving social insurance.

Expertise and finance: Mergers motivated by technological change

This paper argues that a large technological innovation may lead to a merger wave by inducing entrepreneurs to seek funds from technologically knowledgeable firms -experts. When a large technological innovation occurs, the ability of non-experts (banks) to discriminate between good and bad quality projects is reduced. Experts can continue to charge a low rate of interest for financing because their expertise enables them to identify good quality projects and to avoid unprofitable investments. On the other hand, non-experts now charge a higher rate of interest in order to screen bad projects. More entrepreneurs, therefore, disclose their projects to experts to raise funds from them. Such experts are, however, able to copy the projects and disclosure to them invites the possibility of competition. Thus the entrepreneur and the expert may merge so as to achieve product market collusion. As well as rationalizing mergers, the model can also explain various forms of venture financing by experts such as corporate investors and business angels.

Technological change and the wealth of nations

We discuss a unified theory of directed technological change and technologyadoption that can shed light on the causes of persistent productivity differencesacross countries. In our model, new technologies are designed in advanced countries and diffuse endogenously to less developed countries. Our framework is richenough to highlight three broad reasons for productivity differences: inappropriatetechnologies, policy-induced barriers to technology adoption, and within-countrymisallocations across sectors due to policy distortions. We also discuss the effectsof two aspects of globalization, trade in goods and migration, on the wealth ofnations through their impact on the direction of technical progress. By doing so,we illustrate some of the equalizing and unequalizing forces of globalization.

Managing by values in the next milenium: Cultural redesign for strategic organizational change

The system of beliefs and values, that shaped the model for management and organizations during the 20th century, is just not good enough today. In order to keep a business functioning well and competing successfully in markets that are increasingly more global, complex, professionally demanding, constantly changing and oriented towards quality and customer satisfaction a new model is needed. In this paper, we will propose that both Management by Instructions (MBI) and Management by Objectives (MBO) today give notoriously inadequate results. By contrast, description of a new approach labeled: Management by Values (MBV), seem to be emerging as a strategic leadership tool. The paper outlines this approach and discusses the implementation of MBV as a tool to redesign culture in organizations and prepare them for the next millenium.

Small scale underwater change detection

In this paper, we present a method to deal with the constraints of the underwater medium for finding changes between sequences of underwater images. One of the main problems of underwater medium for automatically detecting changes is the low altitude of the camera when taking pictures. This emphasise the parallax effect between the images as they are not taken exactly at the same position. In order to solve this problem, we are geometrically registering the images together taking into account the relief of the scene

Cationic Diffusion in La2/3Ca1/3MnO3 Thin Films Grown on LaAlO3 (001) Substrates.

Microstructural features of La2/3Ca1/3MnO3 layers of various thicknesses grown on top of 001 LaAlO3 substrates are studied by using transmission electron microscopy and electron energy loss spectroscopy. Films are of high microstructural quality but exhibit some structural relaxation and mosaicity both when increasing thickness or after annealing processes. The existence of a cationic segregation process of La atoms toward free surface has been detected, as well as a Mn oxidation state variation through layer thickness. La diffusion would lead to a Mn valence change and, in turn, to reduced magnetization.

Fine speckle contrast in InGaAs/InP systems: Influence of layer thickness, missmatch, and growing temperature

This work is focused on the study of the fine speckle contrast present in planar view observations of matched and mismatched InGaAs layers grown by molecular beam epitaxy on InP substrates. Our results provide experimental evidence of the evolution of this fine structure with the mismatch, layer thickness, and growth temperature. The correlation of the influence of all these parameters on the appearance of the contrast modulation points to the development of the fine structure during the growth. Moreover, as growth proceeds, this structure shows a dynamic behavior which depends on the intrinsic layer substrate stress.

Technological Change and Immigration

We develop a simple model where two technologies are available to produce the same good, and we study under what conditions both will be used. We use the model to analyze the consequences of the simultaneous use of two different technologies for the economic variables and economic growth. Finally, we explore how migrations of factors affect the technological change and the performance of the economy.