The Monotonicity Puzzle: An Experimental Investigation of Incentive Structures

Non-monotone incentive structures, which - according to theory - are able to induce optimal behavior, are often regarded as empirically less relevant for labor relationships. We compare the performance of a theoretically optimal non-monotone contract with a monotone one under controlled laboratory conditions. Implementing some features relevant to real-world employment relationships, our paper demonstrates that, in fact, the frequency of income-maximizing decisions made by agents is higher under the monotone contract. Although this observed behavior does not change the superiority of the non-monotone contract for principals, they do not choose this contract type in a significant way. This is what we call the monotonicity puzzle. Detailed investigations of decisions provide a clue for solving the puzzle and a possible explanation for the popularity of monotone contracts.

Political process and government growth: a theoretical and empirical investigation

A striking feature of virtually al western industrialized countries sice the middle of the past century has been the persistent growth of their government sector. From the beginning of the century to the late 1970's, the government expenditures' share of gross national product has increased from 7% to 36% in the U.S., 11% to 40% in the U.K., and 3% to 25% in Japan. In Germany, it went from 7% to 42% (1872-1978), while in France it soared from 11% to 59% (1872-1979). The evolution of the number of government employees followed a similar pattern. In the U.S., for instance, the average annual rate of growth of the government labor force over the period 1899-1974 has been 3.17%, compared to a 1.62% average annual growth rate of the working population. Less quantifiable aspects like the number and scope of regulations also refelct a growing public sector.

The Life and Times of Bills

Time is one of the scarcest resources in modern parliaments. In parliamentary systems of government the control of time in the chamber is a significant power resource enjoyed – to varying degrees – by parliamentary majorities and the governments they support. Minorities may not be able to muster enough votes to stop bills, but they may have – varying degrees of – delaying powers enabling them to extract concessions from majorities attempting to get on with their overall legislative programme. This paper provides a comparative analysis of the dynamics of the legislative process in 17 West European parliaments from the formal initiation of bills to their promulgation. The ‘biographies’ of a sample of bills are examined using techniques of event-history analysis (a) charting the dynamics of the legislative process both across the life-times of individual bills and different political systems and (b) examining whether, and to what extent, parliamentary rules and some general regime attributes influence the dynamics of this process, speeding up or delaying the passage of legislation. Using a veto-points framework and transaction cost politics as a theoretical framework, the quantitative analyses suggest a number of counter-intuitive findings (e.g., the efficiency of powerful committees) and cast doubt on some of the claims made by Tsebelis in his veto-player model.

Managing the risks of medical technology: Do hazard surveillance systems provide an early warning of medical device problems?

The Food and Drug Administration (FDA) is responsible for risk assessment and risk management in the post-market surveillance of the U.S. medical device industry. One of the FDA regulatory mechanisms, the Medical Device Reporting System (MDR) is an adverse event reporting system intended to provide the FDA with advance warning of device problems. It includes voluntary reporting for individuals, and mandatory reporting for device manufacturers. ^ In a study of alleged breast implant safety problems, this research examines the organizational processes by which the FDA gathers data on adverse events and uses adverse event reporting systems to assess and manage risk. The research reviews the literature on problem recognition, risk perception, and organizational learning to understand the influence highly publicized events may have on adverse event reporting. Understanding the influence of an environmental factor, such as publicity, on adverse event reporting can provide insight into the question of whether the FDA's adverse event reporting system operates as an early warning system for medical device problems. ^ The research focuses on two main questions. The first question addresses the relationship between publicity and the voluntary and mandatory reporting of adverse events. The second question examines whether government agencies make use of these adverse event reports. ^ Using quantitative and qualitative methods, a longitudinal study was conducted of the number and content of adverse event reports regarding breast implants filed with the FDA's medical device reporting system during 1985–1991. To assess variation in publicity over time, the print media were analyzed to identify articles related to breast implant failures. ^ The exploratory findings suggest that an increase in media activity is related to an increase in voluntary reporting, especially following periods of intense media coverage of the FDA. However, a similar relationship was not found between media activity and manufacturers' mandatory adverse event reporting. A review of government committee and agency reports on the FDA published during 1976–1996 produced little evidence to suggest that publicity or MDR information contributed to problem recognition, agenda setting, or the formulation of policy recommendations. ^ The research findings suggest that the reporting of breast implant problems to FDA may reflect the perceptions and concerns of the reporting groups, a barometer of the volume and content of media attention. ^

Promoting gender equality in responses to climate change: The case of Kenya

The paper discusses how Kenyan policies and organisations address gender equality in climate change-related responses. The political support for gender issues is reflected in presidential directives on various actions for achieving gender equality such as the establishment of gender desk officers and ensuring 30 per cent female representation in government. Despite the well-advanced gender mainstreaming policy in Kenya, few policies focus on climate change and even fewer on its inter-linkages with gender. At the field level, encrusted traditions, inadequately trained staff, limited financial resources, and limited awareness of the inter-linkages between gender and climate change remain major challenges to promoting gender equality in the work of government organisations. The paper thus proposes measures for addressing these challenges and strengthening gender equality in responses to climate change.

Capacity building in the use of geospatial tools for natural resource management in Tajikistan: Final Report

The Swiss Swiss Consultant Trust Fund (CTF) support covered the period from July to December 2007 and comprised four main tasks: (1) Analysis of historic land degradation trends in the four watersheds of Zerafshan, Surkhob, Toirsu, and Vanj; (2) Translation of standard CDE GIS training materials into Russian and Tajik to enable local government staff and other specialists to use geospatial data and tools; (3) Demonstration of geospatial tools that show land degradation trends associated with land use and vegetative cover data in the project areas, (4) Preliminary training of government staff in using appropriate data, including existing information, global datasets, inexpensive satellite imagery and other datasets and webbased visualization tools like spatial data viewers, etc. The project allowed building of local awareness of, and skills in, up-to-date, inexpensive, easy-to-use GIS technologies, data sources, and applications relevant to natural resource management and especially to sustainable land management. In addition to supporting the implementation of the World Bank technical assistance activity to build capacity in the use of geospatial tools for natural resource management, the Swiss CTF support also aimed at complementing the Bank supervision work on the ongoing Community Agriculture and Watershed Management Project (CAWMP).

Capitalisation of Experiences of the Swiss Support to Sustainable Management of Natural Resources (SMNR) in Bulgaria

Following the collapse of the communist regime in 1989, Bulgaria has undergone dramatic political, economic and social transformations. The transition process of the past two decades was characterized by several reforms to support democratisation of the political system and the functioning of a free-market economy. Since 1992, Switzerland has been active in Bulgaria providing assistance to the transition process, with support to Sustainable Management of Natural Resources (SMNR) starting in 1995. The SMNR Capitalisation of Experiences (CapEx) took place between March and September 2007, in the context of SDC phasing out its programmes in Bulgaria by the end of 2007 due to the country’s accession to the European Union. The CapEx exercise has culminated in the identification of 17 lessons learned. In the view of the CapEx team, many of these lessons are relevant for countries that are in the process of joining the EU, facing similar democratisation challenges as Bulgaria. Overall, the Swiss SMNR projects have been effective entry points to support areas that are crucial to democratic transitions, namely participation in public goods management, decentralisation, human capacity development in research and management, and preparation for EU membership. The specificity of the Swiss support stems from an approach that combines a long-term commitment with a clear thematic focus (forestry, biodiversity conservation and organic agriculture). The multistakeholder approach and diversification of support between local, regional and national levels are also important elements that contributed to make a difference in relation to other donors supporting the Bulgarian transition. At the institutional level, there are a number of challenges where the contribution of SMNR activities was only modest, namely improving the legal framework and creating more transparency and accountability, both of which are time and resource-consuming processes. In addition, the emergence of competent and sustainable non-government organisations (NGOs) is a complex process that requires support to membership based organisations, a challenge that was hardly met in the case of SMNR. Finally, reform of government institutions involved in management of natural resources is difficult to achieve via project support only, as it requires leverage and commitment at the level of policy dialogue. At the programme management level, the CapEx team notes that corruption was not systematically addressed in SMNR projects, indicating that more attention should be given to this issue at the outset of any new project.

Choosing the path of austerity: how parties and policy coalitions influence welfare state retrenchment in periods of fiscal consolidation

What are the conditions under which some austerity programmes rely on substantial cuts to social spending? More specifically, do the partisan complexion and the type of government condition the extent to which austerity policies imply welfare state retrenchment? This article demonstrates that large budget consolidations tend to be associated with welfare state retrenchment. The findings support a partisan and a politico-institutionalist argument: (i) in periods of fiscal consolidation, welfare state retrenchment tends to be more pronounced under left-wing governments; (ii) since welfare state retrenchment is electorally and politically risky, it also tends to be more pronounced when pursued by a broad pro-reform coalition government. Therefore, the article shows that during budget consolidations implemented by left-wing broad coalition governments, welfare state retrenchment is greatest. Using long-run multipliers from autoregressive distributed lag models on 17 OECD countries during the 1982–2009 period, substantial support is found for these expectations.

Managing social policy under federalism: The challenges of hybrid funding and program delivery

This paper discusses generally the question of the level of government that should be used to administer different social policies. The chapter focuses on the Medicaid program, looking at recent state-level changes in health insurance for the poor and long-term care policy. Particular attention will be paid to the question of how states have used their new freedoms to outsource public insurance to the private sector and on the consequent differences in outcomes across states. Notably, this paper will be drawn from my forthcoming book “The American Myth of Markets in Social Policy” (Palgrave, MacMillan, November, 2015).

The Optimal Response to Default: Renegotiation or Extended Maturity?

This paper reinforces the argument of Harding and Sirmans (2002) that the observed preference of lenders for extended maturity rather than renegotiation of the principle in the case of loan default is due to the superior incentive properties of the former. Specifically, borrowers have a greater incentive to avoid default under extended maturity because it reduces the likelihood that they will be able to escape paying off the full loan balance. Thus, although extended maturity leaves open the possibility of foreclosure, it will be preferred to renegotiation as long as the dead weight loss from foreclosure is not too large.

HOUSE-TO-HOUSE SURVEY OF ACCESS TO AND USE OF PUBLIC HEALTH FACILITIES IN METROPOLITAN LAGOS, NIGERIA

One of the broad objectives of the Nigerian health service, vigorously being pursued at all levels of government, is to make comprehensive health care available and accessible to the population at the lowest possible cost, within available resources. Some state governments in the federation have already introduced free medical service as a practical way to remove financial barriers to access and in turn to encourage greater utilization of publicly funded care facilities.^ To aid health planners and decision makers in identifying a shorter corridor through which urban dwellers can gain access to comprehensive health care, a health interview survey of the metropolitan Lagos was undertaken. The primary purpose was to ascertain the magnitude of access problems which urban households face in seeking care from existing public facilities at the time of need. Six categories of illness chosen from the 1975 edition of the International Classification of Disease were used as indicators of health need.^ Choice of treatment facilities in response to illness episode was examined in relation to distance, travel time, time of use and transportation experiences. These were graphically described. The overall picture indicated that distance and travel time coexist with transportation problems in preventing a significant segment of those in need of health care from benefitting in the free medical service offered in public health facilities. Within this milieu, traditional medicine and its practitioners became the most preferred alternative. Recommendations were offered for action with regard to decentralization of general practitioner (GP) consultations in general hospitals and integration of traditional medicine and its practitioners into public health service. ^

CIGARETTE SMOKING AMONG HIGH SCHOOL STUDENTS IN RURAL AREAS OF THAILAND

The purpose of this study was to identify the smoking prevalence among high school students in rural areas of Thailand and the factors associated with their smoking habits. The sample population was comprised of 946 volunteer students of both sexes enrolled in the twelfth grade classes of the 1981-82 school year in randomly chosen regional public high schools throughout the country. Data were obtained from a formal self-administered questionnaire survey. The comparisons were treated by classified smoking habits as "non-smoker," "trier," "ex-smoker," and "smoker."^ The study presented the low rate of cigarette smoking habits among female students, compared to male students. Significant differences of smoking-related habits were found among those who had exemplar models for smoking habits; fathers, siblings and peers were their reference groups. Parental approval was found to be a significant factor associated with students' smoking habits. The awareness of health hazards, the perceptions of the influence of cigarette advertisement, and the attitudes toward the concerns of government in cigarette manufacturing were also factors associated with cigarette smoking habits of high school subjects. ^

THE RELATIONSHIP BETWEEN ATTITUDE ASSESSMENT/ROLE PERCEPTION AND THE FINANCIAL PERFORMANCE OF HOSPITAL DEPARTMENT MANAGERS

Much of the current healthcare financial literature addresses the concern of government officials, the public, and healthcare providers regarding the need for control of health care costs. The literature suggests that attitudes of hospital department managers toward their role in financial management affects their ability to effect favorable financial results.^ There were several objectives of the dissertation: (1) To identify whether or not there exists a relationship between the attitude/role perception of hospital managers and the financial performance of their departments. (2) To compile a descriptive survey data base of key factors identified in the financial literature from individual hospitals. (3) To compile a brief descriptive survey of hospital managers' financial management background and training (both formal and informal). (4) To conduct an attitude assessment/role perception survey regarding the importance or relevance of a suggested financial management role set (i.e., issues discussed in the current literature) as viewed by the selected hospital managers and their matched administrators. (5) To propose plausible theoretical models and statistical tests of seven proposed hypotheses.^ The statistical results of a variety of methods generally suggested, for the sample population, that the null hypothesis should not be rejected concerning the relationships between a department manager's financial attitudes and role perceptions and the resultant financial performance.^ The fact that the results of this study did not suggest that there was a significant relationship which existed between role perception and financial performance does not necessarily indicate that the theories supporting such a relationship in literature are false, not that such a relationship does not exist. Several alternative theories were postulated to explain the apparent lack of statistical relationship, and suggestions for refinement and/or improvement of further research were discussed. ^

The role of municipalities in air toxics regulation: The Houston experience

The federal regulatory regime for addressing airborne toxic pollutants functions fairly well in most of the country. However, it has proved deficient in addressing local risk issues, especially in urban areas with densely concentrated sources. The problem is especially pronounced in Houston, which is home to one of the world's biggest petrochemical complexes and a major port, both located near a large metropolitan center. Despite the fact that local government's role in regulating air toxics is typically quite limited, from 2004-2009, the City of Houston implemented a novel municipality-based air toxics reduction strategy. The initiatives ranged from voluntary agreements to litigation and legislation. This case study considers why the city chose the policy tools it did, how the tools performed relative to the designers' intentions, and how the debate among actors with conflicting values and goals shaped the policy landscape. The city's unconventional approach to controlling hazardous air pollution has not yet been examined rigorously. The case study was developed through reviews of publicly available documents and quasi-public documents obtained through public record requests, as well as interviews with key informants. The informants represented a range of experience and perspectives. They included current and former public officials at the city (including Mayor White), former Texas Commission on Environmental Quality staff, faculty at local universities, industry representatives, and environmental public health advocates. Some of the city's tools were successful in meeting their designers' intent, some were less successful. Ultimately, even those tools that did not achieve their stated purpose were nonetheless successful in bringing attention and resources to the air quality issue. Through a series of pleas and prods, the city managed to draw attention to the problem locally and get reluctant policymakers at higher levels of government to respond. This work demonstrates the potential for local government to overcome limitations in the federal regulatory regime for air toxics control, shifting the balance of local, state, and federal initiative. It also highlights the importance of flexible, cooperative strategies in local environmental protection.^