Monetarism - The Unfinished Business
Scientific Research Programmes and the Prediction of Corporate Behaviour
The theory of contestable markets and the transaction cost analysis of corporate strategy are argued to imply the need for a change in methodology that their proponents mostly do not seem to have perceived namely, a need to develop workable ways of anticipating the behavior of actual firms if economists are to be able to anticipate industrial evolution. The paper then explores the possibility of modeling corporate decision processes as if firms operate in ways akin to academic sciences as depicted by Kuhn and Lakatos. Firms are depicted as behaving differently essentially because they have different corporate philosophies, different methodologies for survival in a world of uncertainty and complexity. This meta-framework is complementary to literature on corporate culture; both appear to be of practical use to economists advising on industrial policy.
Public Sector Growth: Modelling Intertemporal Goverment Behaviour
In this paper the time pattern of public sector size and growth is the context of Wagner's law. The hypothesis advanced is that a modern multi-objective government adjusts the size of the public sector to the desired level only partially each period, so that its allocative function does not interfere with its stabilization goal. For this purpose, a dynamic model of government behavior has been developed and applied to the U.K. case over the period 1954-83. The findings confirm our basic hypothesis. The average period of adjustment has ranged between 1.3 and 2 years, depending upon the macroeconomic state of the economy.
Supply Response of Greek Annual Crops and the Cap Effect
The present paper reports an attempt to estimate the supply response of eleven major Greek annual crops to the EEC membership using a modified Nerlovian model. The effect of the CAP, the policy used for intervention in the agricultural sector, was found to be either non-significant or negative. Such a result supports the hypothesis that the CAP was inadequate, probably due to the fact that its restrictive measures dominated over the expanding ones.