Introductory Chapter to The Economics of Nonprofit Enterprises

Nonprofit organizations present the analyst with a slew of puzzles. To an economist conditioned to think in terms of objectives and constraints, even the mathematical definition of the beast is a problem. What is a nonprofit organization? How does this definition shape the elaboration of objectives and constraints?

Mortality, fertility, and persistent income inequality

Many developing countries are plagued by persistent inequality in income distribution. While a growing body of economic-demographic literature emphasizes differential fertility channel, this paper investigates differential child mortality--differences in child mortality across income groups--as a critical link through which income inequality persists. Using an overlapping generations model in which both child mortality and fertility are endogenously determined by parental choice, this paper demonstrates that differential child mortality and its interaction with differential fertility may generate an "income inequality trap." The trap is characterized by higher child mortality and lower degree of skill formation among the poorer households. The model can also explain the behavior of aggregate fertility and mortality rates for countries at various stages of development, consonant with patterns of demographic transition. The results indicate that provision of public health that raises the productivity of private health spending may be an effective way to reduce income inequality

Analysis of productive performance of crop and animal production systems : an integrated analytical framework

This article presents a two-stage analytical framework that integrates ecological crop (animal) growth and economic frontier production models to analyse the productive efficiency of crop (animal) production systems. The ecological crop (animal) growth model estimates "potential" output levels given the genetic characteristics of crops (animals) and the physical conditions of locations where the crops (animals) are grown (reared). The economic frontier production model estimates "best practice" production levels, taking into account economic, institutional and social factors that cause farm and spatial heterogeneity. In the first stage, both ecological crop growth and economic frontier production models are estimated to calculate three measures of productive efficiency: (1) technical efficiency, as the ratio of actual to "best practice" output levels; (2) agronomic efficiency, as the ratio of actual to "potential" output levels; and (3) agro-economic efficiency, as the ratio of "best practice" to "potential" output levels. Also in the first stage, the economic frontier production model identifies factors that determine technical efficiency. In the second stage, agro-economic efficiency is analysed econometrically in relation to economic, institutional and social factors that cause farm and spatial heterogeneity. The proposed framework has several important advantages in comparison with existing proposals. Firstly, it allows the systematic incorporation of all physical, economic, institutional and social factors that cause farm and spatial heterogeneity in analysing the productive performance of crop and animal production systems. Secondly, the location-specific physical factors are not modelled symmetrically as other economic inputs of production. Thirdly, climate change and technological advancements in crop and animal sciences can be modelled in a "forward-looking" manner. Fourthly, knowledge in agronomy and data from experimental studies can be utilised for socio-economic policy analysis. The proposed framework can be easily applied in empirical studies due to the current availability of ecological crop (animal) growth models, farm or secondary data, and econometric software packages. The article highlights several directions of empirical studies that researchers may pursue in the future.

How Creativity is Changing China

The question Professor Li Wuwei investigates is not 'whether' creativity is changing China - but 'how' creativity is changing China. The outcome will have a profound impact on how China develops and its economic role in the world. Creative industries maintain and protect historical and cultural heritage, improve cultural capital, and foster communities as well as individual creativity. This leads to the improvement of cultural assets of cities, the establishment of city brands and identity, the promotion of the creative economy, and overall economic and social development. In this context, creativity is changing China forever.

Editor's introduction

It is a very rare event when a book by a senior Chinese policy adviser gets published in English. More often the accepted format is biography or auto-biography, generally published once the person has retired. This book was first published by Xinhua Press in Chinese in a longer version in 2009. Initially it was directed at the Chinese reader, more specifically the Chinese cultural academic, and for this reason some of the material is not repeated in this abridged version. Nevertheless, it is important to point out that the author represents four speaking positions, and the messages that emerge from this work need to be contextualized accordingly.

An interpretation of current progress towards an industry model for Queensland's surveying and mapping industry

A strongly progressive surveying and mapping industry depends on a shared understanding of the industry as it exists, some shared vision or imagination of what the industry might become, and some shared action plan capable of bringing about a realisation of that vision. The emphasis on sharing implies a need for consensus reached through widespread discussion and mutual understanding. Unless this occurs, concerted action is unlikely. A more likely outcome is that industry representatives will negate each other's efforts in their separate bids for progress. The process of bringing about consensual viewpoints is essentially one of establishing an industry identity. Establishing the industry's identity and purpose is a prerequisite for rational development of the industry's education and training, its promotion and marketing, and operational research that can deal .with industry potential and efficiency. This paper interprets evolutionary developments occurring within Queensland's surveying and mapping industry within a framework that sets out logical requirements for a viable industry.

A Nobel Prize for governance and institutions : Oliver Williamson and Elinor Ostrom

This paper reviews the 2009 Nobel Prize in Economics jointly awarded to Oliver Williamson for his work on governance in organizations and the boundaries of the firm, and to Elinor Ostrom for her work on the governance of common pool resources. We review the careers and the research contributions of Williamson and Ostrom to the theory and analysis of economic institutions of governance. Both winners of this Prize for 'economic governance' are thoroughly deserved, yet like the Hayek- Myrdal Prize of 1974 their respective approaches, methods and findings are almost diametrically opposed. Williamson offers a top-down contracts-based solution to the incentive problems of opportunism in corporate governance, whereas Ostrom offers a bottom-up communication-based solution to the governance opportunities of community resources. We offer some critical comments on Williamson's analytic work and discussion of the potential for further application of Ostrom's case-study based experimental methodology. We conclude with a suggested third nominee to make better sense of how these two great scholars' works fit together, namely George Richardson'

Taxation of multinational banks : using formulary apportionment to reflect economic reality

The taxation of multinational banks is currently governed by general principles of international tax. However, there are characteristics exclusive to multinational banks that may warrant consideration of a separate taxing regime, as the current system does not produce a result that accurately reflects the economic source of the income or the location of the economic activity. The suggested alternative is unitary taxation using global formulary apportionment.

Australia's adoption of an international tax regime : to engage or not to engage?

On 1 November 2011 the Minister for Financial Services and Superannuation, the Honourable Bill Shorten MP, announced that Australia would be undertaking a reform of the ‘transfer pricing rules in the income tax law and Australia's future tax treaties to bring them into line with international best practice, improving the integrity and efficiency of the tax system.’ Mr Shorten stated that the reason for the reform was that ‘recent court decisions suggest our existing transfer pricing rules may be interpreted in a way that is out-of-kilter with international norms.’ Further, he stated that ‘the Government has asked the Treasury to review how the transfer pricing rules can be improved, including but not limited to how to be more in line with international best practice.’ He urged all interested parties to participate in this consultation process.

Does occupational aggregation matter in determining the size of the gender wage gap?

The traditional decomposition of the gender wage gap distinguishes between a component attributable to gender differences in productivity-related characteristics and a residual component that is often taken as a measure of discrimination. This study of data from the 1989 Canadian Labour Market Activity Survey shows that when occupation is treated as a productivity-related characteristic, the proportion of the gender wage gap labeled explained increases with the number of occupational classifications distinguished. However, on the basis of evidence that occupational differences reflect the presence of barriers faced by women attempting to enter male-dominated occupations, the authors conclude that occupation should not be treated as a productivity-related characteristic; and in a decomposition of the gender wage gap that treats occupation as endogenously determined, they find that the level of occupational aggregation has little effect on the size of the "explained" component of the gap.