infonet-economy

This is a very colorful paper that makes for interesting reading. The author shows that the U. S. Food and Drug Administration (FDA) increasingly does not decide about market access to drugs only, but influences the innovation process as a whole. And although "information" does not appear in the title of the paper, the distribution of knowledge as affected by the FDA plays an important role at several stages of this process. For this reason, the body of this commentary is arranged according to the stages of the innovation process.

One important motive for deregulating social health insurance is to encourage product innovation. For the first time, the cost savings achieved by non-US managed care plans that are attributable to product innovation are estimated, using a novel approach. Panel data from a major Swiss health insurer permits to infer health status, which can be used to predict health care expenditure. The econometric evidence suggests that the managed care plans benefit from risk selection effects. In the case of the health maintenance organization (HMO) plan, however, the pure innovation effect may account for as much as two-thirds of the cost advantage.

A nonparametric data envelopment analysis (DEA) is performed on hospitals in the federal state of Saxony (Germany) and in Switzerland. This study is of interest from three points of view. First, contrary to most existing work, patient days are not treated as an output but as an input. Second, the usual DEA assumption of a homogeneous sample is tested and rejected for a large part of the observations. The proposed solution is to restrict DEA to comparable observations in the two countries. The finding continues to be that hospitals of Saxony have higher efficiency scores than their Swiss counterparts. The finding proves robust with regard to modifications of DEA that are motivated by differences in hospital planning in Germany and Switzerland.

Rational agents can express discontent with a given distribution of income by threatening to disrupt an economy, if such a threat is profitable. This paper describes such circumstances in a two-class model. Social stability constraints define the acceptable set of income distributions, the range of which is determined by the extent to which income-generating abilities are vulnerable to disruption. Opportunities for disruption vary across stages of economic development. There is possibly no stable distribution in a low developed economy, whereas in an advanced economy, characterized by complex and interdependent production, stable distributions exist. This distinction provides a basis for the observed increasing significance of social stabilization by redistributive policy in the course of economic development.

This paper presents a model in which final goods producers outsource intermediate input
production. Intermediate inputs are differentiated and their production can be located at home or abroad. The model is used to examine competitive location policy in a (two-country) free trade area (FTA). It is shown that national public infrastructure investment has a positive effect on both the
number of intermediate input producers and the return to the immobile factor in the home country. International outsourcing from home declines. Opposite effects are triggered in the partner country. In a welfare analysis we characterize national infrastructure policies that aim to maximize national income (net of tax costs) and compare the non-cooperative FTA-equilibrium with optimal policies from an integrated point of view. We show whether or not there is a need for policy coordination.
Firm subsidies are discussed as an alternative to public infrastructure investment.

We present a model in which workers must be educated to get a good job and firms must innovate in order to increase productivity. Education as well as innovation and production require skilled labor as inputs. This, together with the fact that learning opportunities differ across workers, determine simultaneously the long-run level of skilled employment and the long-run rate of growth. We study the impact of changes in the factors which affect the education of workers and the incentives to innovate, and discuss the growth and employment effects of labor market policy measures.

DEUTSCH: Dieser Beitrag setzt sich zum Ziel, zwei miteinander verbundene Fragen zu
beantworten: 1. Was ist der Auftrag der Krankenversicherung? Oder in anderen
Worten: Warum gibt es eine Nachfrage nach sozialer (bzw. staatlicher)
Krankenversicherung? Ist sie der Grund dafu¨ r, dass in den meisten entwickelten
La¨ndern die private Krankenversicherung ein Schattendasein fu¨hrt?
2. Wo liegen die Grenzen der Sozialen Krankenversicherung? Kann man
sagen, es gebe ein Zuviel an Sozialer Krankenversicherung in mindestens
einer der beiden Dimensionen? Sollte ihre Vorherrschaft zu Gunsten der
privaten Krankenversicherung gebrochen werden? Ist das heutige Ausmaß
der Deckung zu hoch?

ENGLISH: This contribution seeks to answer two questions, (1) What are the reasons for a demand for social health insurance (SHI)?, and (2) What are the limits to the growth of SHI? A review of the reasons for the existence of SHI reveals that while economists have emphasized the possible contribution of SHI to efficiency, the available evidence points to public choice reasons, which also seem to explain better the growth of SHI. Indeed, since private insurance redistributes as well (albeit governed by chance), it is tempting for politicians to use SHI for systematic redistribution (the extent of which cannot easily be detected by net payers). Turning to the supply of SHI, two dimensions are studied in some detail, viz. efforts at product innovation and at risk selection. Competing suppliers of SHI, while hampered by risk adjustment which sanctions innovators for attracting the young, are predicted to invest in innovation. A monopolistic public SHI scheme, by way of contrast, does not need to select risks and, on the other hand, it is predicted to refrain from product innovation. This is but one limit to the growth of SHI; the ultimate one is citizens' lack of willingness to pay for its continuing expansion, about which some evidence for the case of Switzerland is presented.

Probleme der Finanzierung sind für die Marktdiffusion innovativer Energietechnologien ebenso wichtig wie ihre technischen Eigenschaften oder der erwartete Nutzen aus der Technologieanwendung. Welche Rolle spielt dabei die Eigentümerstruktur des Innovators? Welchen Einfluss hat die Finanzierungsform des Investitionsvorhabens—und damit das finanzielle Risiko—auf die Attraktivität einer Energieinvestition?

The macro evidence of increased adjustment pressure since the early 1970s suggests that job mobility should have increased. Hence, retrospective and spell data from the German Socio-Economic Panel are combined in order to test the hypothesis that job stability for German workers declined between 1974 and 1994. Using count data regression models in which we control for labour market experience, various demographic factors, and occupation, we find that job stability did not decrease, but if anything increased, between 1974 and 1994. Our finding suggests that labour market inflexibility is an important factor in explaining the European unemployment problem.