An agent-based approach to value theory and wealth distribution in economics

Any attempt to model an economy requires foundational assumptions about the relations between prices, values and the distribution of wealth. These assumptions exert a profound influence over the results of any model. Unfortunately, there are few areas in economics as vexed as the theory of value. I argue in this paper that the fundamental problem with past theories of value is that it is simply not possible to model the determination of value, the formation of prices and the distribution of income in a real economy with analytic mathematical models. All such attempts leave out crucial processes or make unrealistic assumptions which significantly affect the results. There have been two primary approaches to the theory of value. The first, associated with classical economists such as Ricardo and Marx were substance theories of value, which view value as a substance inherent in an object and which is conserved in exchange. For Marxists, the value of a commodity derives solely from the value of the labour power used to produce it - and therefore any profit is due to the exploitation of the workers. The labour theory of value has been discredited because of its assumption that labour was the only ‘factor’ that contributed to the creation of value, and because of its fundamentally circular argument. Neoclassical theorists argued that price was identical with value and was determined purely by the interaction of supply and demand. Value then, was completely subjective. Returns to labour (wages) and capital (profits) were determined solely by their marginal contribution to production, so that each factor received its just reward by definition. Problems with the neoclassical approach include assumptions concerning representative agents, perfect competition, perfect and costless information and contract enforcement, complete markets for credit and risk, aggregate production functions and infinite, smooth substitution between factors, distribution according to marginal products, firms always on the production possibility frontier and firms’ pricing decisions, ignoring money and credit, and perfectly rational agents with infinite computational capacity. Two critical areas include firstly, the underappreciated Sonnenschein-Mantel- Debreu results which showed that the foundational assumptions of the Walrasian general-equilibrium model imply arbitrary excess demand functions and therefore arbitrary equilibrium price sets. Secondly, in real economies, there is no equilibrium, only continuous change. Equilibrium is never reached because of constant changes in preferences and tastes; technological and organisational innovations; discoveries of new resources and new markets; inaccurate and evolving expectations of businesses, consumers, governments and speculators; changing demand for credit; the entry and exit of firms; the birth, learning, and death of citizens; changes in laws and government policies; imperfect information; generalized increasing returns to scale; random acts of impulse; weather and climate events; changes in disease patterns, and so on. The problem is not the use of mathematical modelling, but the kind of mathematical modelling used. Agent-based models (ABMs), objectoriented programming and greatly increased computer power however, are opening up a new frontier. Here a dynamic bargaining ABM is outlined as a basis for an alternative theory of value. A large but finite number of heterogeneous commodities and agents with differing degrees of market power are set in a spatial network. Returns to buyers and sellers are decided at each step in the value chain, and in each factor market, through the process of bargaining. Market power and its potential abuse against the poor and vulnerable are fundamental to how the bargaining dynamics play out. Ethics therefore lie at the very heart of economic analysis, the determination of prices and the distribution of wealth. The neoclassicals are right then that price is the enumeration of value at a particular time and place, but wrong to downplay the critical roles of bargaining, power and ethics in determining those same prices.

International housing market analysis based on housing commencements

Additions to the aggregate housing stock are a broad measure of the state of an economy and overall level of confidence in a particular region over a designated period. This is due to the direct and indirect effect (e.g. employment in the housing construction industry) upon on the local economy and is linked to the confidence of local households in the future direction of housing investment, the level of housing affordability by households as related to employment levels and the relationship between supply and demand in each region. Another consideration is the ability of the government to monitor and successfully intervene in the operation of the household market (e.g. mortgage interest rates) with the intent of restricting an over-supply situation which may take years to fully recover. The analysis in this section examines new housing commencements for Scotland, Australia, USA and Canada over an extended time period with the specific focus placed on the periods before, during and after the high profile global financial crisis in 2007-2008. The graph in Figure 1 was adapted from data sourced from The Scottish Government (2013) and covers the 15-year period between 1998 and 2012. With the exception of 1999 there were been relatively few years with substantial additions to the housing market. However, the effect of the GFC can clearly be observed post 2007 although by 2012 there was relatively change from the previous year.

Generic drug prices and policy in Australia: room for improvement? A comparative analysis with England

To assess the degree to which reimbursement prices in Australia and England differ for a range of generic drugs, and to analyse the supply- and demand-side factors that may contribute to these differences.

The Brazilian and the french private equity sectors from 2006 to present: a comparative analysis

Private equity, ou o ato de fundos ou investidores de investir em empresas não cotadas em bolsa pública, assumiu uma importância crescente no mundo financeiro nos últimos anos. De fato, enquanto o surgimento de um setor de private equity (PE) tem sido um grande fenômeno em mercados emergentes desde meados dos anos 2000, a crise financeira mundial enfraqueceu private equity no mundo desenvolvido. Assim, esta pesquisa vai se concentrar em dois países com dinâmicas supostamente muito diferentes em relação a este sector: França e Brasil. O objetivo será o de discernir padrões gerais de comportamento em ambos os sectores de PE durante todo o período compreendido 2006-2013, e tentar determinar em que medida eles são comparáveis. Utilizando a literatura como fonte conceitual para o quadro comparativo a ser desenvolvido, será analisado se as condições do mercado e do ambiente institucional evoluíram durante o período estudado na França e no Brasil, se comparar, e se eles impactaram o nível de atividade de private equity - oferta e demanda de fundos - em ambos os países. Para identificar esses padrões, a pesquisa contará com uma análise de dados exploratória qualitativa, com base em um quadro dos determinantes do setor de PE identificados e retirados da literatura acadêmica. Esta pesquisa trazera sua contribuição para o trabalho acadêmico existente sobre private equity, graças à sua natureza comparativa e para a sua conclusão sobre a relevância dos determinantes acima mencionados sobre a atividade de private equity na França e no Brasil.

Structural change and productivity growth, 20 years later: old problems, new opportunities

Includes bibliography

SMEs in the environmental goods and services market: identifying areas of opportunity, policies and instruments: case studies: Argentina, Chile, Colombia and Mexico

Includes bibliography

Structural change and productivity growth 20 years later: old problems, new opportunities. Summary

Includes bibliography

Latin American supply and major world market demand for the principal metals, 1970-1990: aluminium, copper, iron, nickel, lead, zinc, tin

Includes bibliography

Development of an integrative cessation program for co-smokers of cigarettes and cannabis: demand analysis, program description, and acceptability

Abstract Background Tobacco and cannabis use are strongly interrelated, but current national and international cessation programs typically focus on one substance, and address the other substance either only marginally or not at all. This study aimed to identify the demand for, and describe the development and content of, the first integrative group cessation program for co-smokers of cigarettes and cannabis. Methods First, a preliminary study using expert interviews, user focus groups with (ex-)smokers, and an online survey was conducted to investigate the demand for, and potential content of, an integrative smoking cessation program (ISCP) for tobacco and cannabis co-smokers. This study revealed that both experts and co-smokers considered an ISCP to be useful but expected only modest levels of readiness for participation.Based on the findings of the preliminary study, an interdisciplinary expert team developed a course concept and a recruitment strategy. The developed group cessation program is based on current treatment techniques (such as motivational interviewing, cognitive behavioural therapy, and self-control training) and structured into six course sessions.The program was evaluated regarding its acceptability among participants and course instructors. Results Both the participants and course instructors evaluated the course positively. Participants and instructors especially appreciated the group discussions and the modules that were aimed at developing personal strategies that could be applied during simultaneous cessation of tobacco and cannabis, such as dealing with craving, withdrawal, and high-risk situations. Conclusions There is a clear demand for a double cessation program for co-users of cigarettes and cannabis, and the first group cessation program tailored for these users has been developed and evaluated for acceptability. In the near future, the feasibility of the program will be evaluated. Trial registration Current Controlled Trials ISRCTN15248397

Food waste along the supply chain. An analysis of nowadays food supply chain challenges in the italian and english contexts

Scopo. Lo scopo di questo studio è esaminare il problema degli sprechi nelle moderne food supply chain, così da consentire una piena comprensione delle principali cause di inefficienza sistemica nell’industria alimentare e individuare potenziali opportunità di miglioramento. Approccio e Metodologia. Per raggiungere gli obiettivi prefissati la presente trattazione si propone di implementare una ricerca empirica basata sull’analisi di due realtà industriali operanti nel settore alimentare. Nello specifico verranno studiate due aziende integrate rispettivamente nel contesto economico italiano e in quello inglese e operanti a due stadi diversi e complementari della filiera alimentare, quello della produzione e quello della distribuzione. Questo studio incrociato consentirà, auspicabilmente, di portare alla luce quegli elementi chiave necessari per una lettura chiara ed esaustiva delle maggiori sfide che le moderne supply chain si trovano a dover affrontare, in una prospettiva di minimizzazione degli sprechi e di accrescimento del valore per il consumatore. Risultati. I risultati che si prevede di ottenere dall’implementazione di questo studio sono fondamentalmente quattro: 1.Piena comprensione del concetto di spreco nell’industria alimentare. 2.Identificazione dei principali fattori chiave che dovrebbero essere attentamente monitorati con lo scopo di conseguire un’efficace riduzione degli sprechi lungo la filiera alimentare. 3.Analisi critica di quelle che sono le più utilizzate pratiche manageriali e operative nelle moderne aziende alimentari. 4.Individuazione dei potenziali sviluppi che potrebbero essere implementati attraverso l’utilizzo delle più recenti ICT in termini di efficienza della supply chain. Valore della Ricerca. Seppure mediante un’analisi prevalentemente di tipo qualitativo, questa trattazione si prefigge di fornire un contributo nell’ambito del food supply chain management che, data la rilevanza del problema relativo agli sprechi, risulta oggi più attuale che mai. L’originalità di questo studio risiede principalmente nelle fonti dei dati che ne hanno costituito le fondamenta: da un lato la ricerca teorica sviluppata nel Regno Unito, dove lo studio della supply chain è ormai da decenni approfondito nelle più importanti Università; dall’altro la ricerca empirica sviluppata sia presso una delle più importanti e moderne aziende alimentari italiane, che presso uno dei più famosi logistics service provider a livello mondiale.

Price risk management in the copper market using commodity derivatives and options strategies

Metals price risk management is a key issue related to financial risk in metal markets because of uncertainty of commodity price fluctuation, exchange rate, interest rate changes and huge price risk either to metals’ producers or consumers. Thus, it has been taken into account by all participants in metal markets including metals’ producers, consumers, merchants, banks, investment funds, speculators, traders and so on. Managing price risk provides stable income for both metals’ producers and consumers, so it increases the chance that a firm will invest in attractive projects. The purpose of this research is to evaluate risk management strategies in the copper market. The main tools and strategies of price risk management are hedging and other derivatives such as futures contracts, swaps and options contracts. Hedging is a transaction designed to reduce or eliminate price risk. Derivatives are financial instruments, whose returns are derived from other financial instruments and they are commonly used for managing financial risks. Although derivatives have been around in some form for centuries, their growth has accelerated rapidly during the last 20 years. Nowadays, they are widely used by financial institutions, corporations, professional investors, and individuals. This project is focused on the over-the-counter (OTC) market and its products such as exotic options, particularly Asian options. The first part of the project is a description of basic derivatives and risk management strategies. In addition, this part discusses basic concepts of spot and futures (forward) markets, benefits and costs of risk management and risks and rewards of positions in the derivative markets. The second part considers valuations of commodity derivatives. In this part, the options pricing model DerivaGem is applied to Asian call and put options on London Metal Exchange (LME) copper because it is important to understand how Asian options are valued and to compare theoretical values of the options with their market observed values. Predicting future trends of copper prices is important and would be essential to manage market price risk successfully. Therefore, the third part is a discussion about econometric commodity models. Based on this literature review, the fourth part of the project reports the construction and testing of an econometric model designed to forecast the monthly average price of copper on the LME. More specifically, this part aims at showing how LME copper prices can be explained by means of a simultaneous equation structural model (two-stage least squares regression) connecting supply and demand variables. A simultaneous econometric model for the copper industry is built: {█(Q_t^D=e^((-5.0485))∙P_((t-1))^((-0.1868) )∙〖GDP〗_t^((1.7151) )∙e^((0.0158)∙〖IP〗_t ) @Q_t^S=e^((-3.0785))∙P_((t-1))^((0.5960))∙T_t^((0.1408))∙P_(OIL(t))^((-0.1559))∙〖USDI〗_t^((1.2432))∙〖LIBOR〗_((t-6))^((-0.0561))@Q_t^D=Q_t^S )┤ P_((t-1))^CU=e^((-2.5165))∙〖GDP〗_t^((2.1910))∙e^((0.0202)∙〖IP〗_t )∙T_t^((-0.1799))∙P_(OIL(t))^((0.1991))∙〖USDI〗_t^((-1.5881))∙〖LIBOR〗_((t-6))^((0.0717) Where, Q_t^D and Q_t^Sare world demand for and supply of copper at time t respectively. P(t-1) is the lagged price of copper, which is the focus of the analysis in this part. GDPt is world gross domestic product at time t, which represents aggregate economic activity. In addition, industrial production should be considered here, so the global industrial production growth that is noted as IPt is included in the model. Tt is the time variable, which is a useful proxy for technological change. A proxy variable for the cost of energy in producing copper is the price of oil at time t, which is noted as POIL(t ) . USDIt is the U.S. dollar index variable at time t, which is an important variable for explaining the copper supply and copper prices. At last, LIBOR(t-6) is the 6-month lagged 1-year London Inter bank offering rate of interest. Although, the model can be applicable for different base metals' industries, the omitted exogenous variables such as the price of substitute or a combined variable related to the price of substitutes have not been considered in this study. Based on this econometric model and using a Monte-Carlo simulation analysis, the probabilities that the monthly average copper prices in 2006 and 2007 will be greater than specific strike price of an option are defined. The final part evaluates risk management strategies including options strategies, metal swaps and simple options in relation to the simulation results. The basic options strategies such as bull spreads, bear spreads and butterfly spreads, which are created by using both call and put options in 2006 and 2007 are evaluated. Consequently, each risk management strategy in 2006 and 2007 is analyzed based on the day of data and the price prediction model. As a result, applications stemming from this project include valuing Asian options, developing a copper price prediction model, forecasting and planning, and decision making for price risk management in the copper market.

EXAMINING POLICY CAPACITY INITIATIVES WITHIN CLIMATE CHANGE FRAMEWORKS IN THREE US AND CANADIAN SECTORS USING NVIVO CONTENT ANALYSIS

The climate change narrative has changed from one of mitigation to one of adaptation. Governments around the world have created climate change frameworks which address how the country can better cope with the expected and unexpected changes due to global climate change. In an effort to do so, federal governments of Canada and the United States, as well as some provinces and states within these countries, have created detailed documents which outline what steps must be taken to adapt to these changes. However, not much is mentioned about how these steps will be translated in to policy, and how that policy will eventually be implemented. To examine the ability of governments to acknowledge and incorporate the plethora of scientific information to policy, consideration must be made for policy capacity. This report focuses on three sectors: water supply and demand; drought and flood planning; and forest and grassland ecosystems, and the word ‘capacity’ as related to nine different forms of policy capacity acknowledged in these frameworks. Qualitative content analysis using NVivo was carried out on fifty four frameworks and the results obtained show that there is a greater consideration for managerial capacity compared to analytical or political capacity. The data also indicated that although there were more Canadian frameworks which referred to policy capacity, the frameworks from the United States actually considered policy capacity to a greater degree.

Avoidable hospitalizations in Switzerland: a small area analysis on regional variation, density of physicians, hospital supply and rurality.

BACKGROUND Avoidable hospitalizations (AH) are hospital admissions for diseases and conditions that could have been prevented by appropriate ambulatory care. We examine regional variation of AH in Switzerland and the factors that determine AH. METHODS We used hospital service areas, and data from 2008-2010 hospital discharges in Switzerland to examine regional variation in AH. Age and sex standardized AH were the outcome variable, and year of admission, primary care physician density, medical specialist density, rurality, hospital bed density and type of hospital reimbursement system were explanatory variables in our multilevel poisson regression. RESULTS Regional differences in AH were as high as 12-fold. Poisson regression showed significant increase of all AH over time. There was a significantly lower rate of all AH in areas with more primary care physicians. Rates increased in areas with more specialists. Rates of all AH also increased where the proportion of residences in rural communities increased. Regional hospital capacity and type of hospital reimbursement did not have significant associations. Inconsistent patterns of significant determinants were found for disease specific analyses. CONCLUSION The identification of regions with high and low AH rates is a starting point for future studies on unwarranted medical procedures, and may help to reduce their incidence. AH have complex multifactorial origins and this study demonstrates that rurality and physician density are relevant determinants. The results are helpful to improve the performance of the outpatient sector with emphasis on local context. Rural and urban differences in health care delivery remain a cause of concern in Switzerland.

The coal future : economic and technological analysis of initiatives and innovations to secure fuel supply independence /

Includes bibliographies.

Geohydrology and model analysis for water-supply management in a small area of west-central Kansas /

Mode of access: Internet.