ALBERT

Notizen: Among economists there has generally been a lack of agreement as to the specific relation between exports and economic growth. The hypothesis presented here is that there is a causal relationship between the two, that this relationship is one of interdependence rather than of unilateral causation, but that it is mainly a rise in exports that stimulates an increase in aggregate economic growth rather than vice versa.There are strong logical and empirical grounds supporting the hypothesis. Rising exports provide the wherewithal for increased imports, so important to economic growth. Emphasis on exports helps concentrate investment in the more efficient sectors of the economy, thus raising productivity. Efficiency is aided further by production for international markets since this permits greater economies of scale and forces firms to hold down their costs in order to remain competitive in international markets. In addition, profitable export industries stimulate additional investment, encourage an increased flow of new technology and managerrial skills, and stimulate increased consumption.The hypothesis was also tested statistically. Multiple correlations and simple least-squares regression equations were calculated for a group of 50 countries using data on average rates of growth of per capita real G. N. P., of exports, and of earnings on current account during 1953-63. The results showed: 1. that the most significant correlation was between exports and G. N. P.; 2. that for every 2 1/2per cent increase in exports, per capita real G. N. P. showed a rise of 1 per cent; and 3. that this last relationship had a high degree of statistical reliability.

Notizen: As a result of inadequacies in the traditional approach to location problems a new body of thought has emerged in recent years which centers on the notion of development poles (po̧les de croissance). This concept was first put forth systematically by F. PERROUX, though it now has come into use in many countries in both theoretical discussions and public policy programs.-The present article examines the often ambiguous uses which have been made of development pole theory and evaluates some of its principal strengths and weaknesses as a tool of economic analysis. Attention also is given to the related concepts of economic space and economic domination.Among the problems of development pole theory are its emphasis upon big industrial undertakings, its relationship to external economies of agglomeration, its relationship to public policy goals, and its need for semantic clarification. Nevertheless, the theory remains potentially valuable for conditional analysis of the process of regional development; moreover, it may be expected that French regional planning experience will provide data in the near future for refining the approach to rational spatial resource allocation to which French economists have so largely contributed.

Notizen: In this article several standard models of economic growth are considered from the point of view of Welfare Economics. As the growth models show a rather material orientation, it might be thought useful to look for the implicit assumptions that are made with respect to the behaviour pattern of consumers and producers, who ultimately govern the actual path of a process of economic growth.To do so fruitfully, the paper starts with a discussion of the role of preferences in economic theory. A distinction is made between individual and collective preferences. The opinion is expressed that up to now economic theory neglected the influence of collective preferences on main economic categories such as prices and income. The discussion of the neo-classical and Harrod-Domar growth models from the outlook of preferences leads among others, to the conclusion that the relation between imperfect competition and economic growth should be studied in more detail. All hitherto published growth models seem to start from the behaviour pattern of individuals that is compatible with perfect competition.

Notizen: The paper presents a model of interest rates structure with direct implications to the saving-investment process. The capital market is divided into private and government sectors, which operate under the constraints of an investment-opportunities function and a cost of capital function. The model provides the government with a degree of freedom to differentiate the lending rate from the borrowing rate. This allows the government to conduct a capital policy aimed at achieving a certain desired level of savings without disturbing the process of capital allocation. The technical operation of the model is based on an institutional structure existing in many developing countries. It allows thereby a direct application for empirical research. The paper is concluded by an empirical testing of the interest rate structure in Israel and of the consistency of the Israeli Government capital policy.

Notizen: Previous contributions to the theory of devaluation have concentrated on its effect on the country's balance of trade (the ‘stability conditions’) and the commodity terms of trade. This paper is concerned with the conditions under which devaluation would improve the country's incometerms of trade defined as:Percentage change in the value of exports./Percentage change in the price of imports.An algebraic formula is developed, which expresses the conditions in terms of the elasticities of export-supply and import-demand. The results are then presented in geometric terms, and applied to some current problems. It turns out that while an industrial country is likely to improve its income terms of trade by devaluing its currency, the opposite is true for a primary-materials producing country.

Notizen: Basing-point pricing is not forbidden in the European Coal and Steel Community and, more important, the provisions of Article 60 of the ECSC-Treaty require a pricing behavior which is analogous to the behavior of oligopolists who have established a multiple basing-point system. This can be most clearly shown by distinguishing three functions of a privately organized basing-point system:1. The control function results from the nondiscrimination principle and the open-price system as required by Articles 60 and 70 and as organized by the High Authority.2. The vent function of a basing-point system is granted in the ECSC by the right to align prices on the lower quotations of competitors who establish their price schedules on the basis of a different location.3. The defense function can also be fulfilled by alignment (punitive bases). As far as the enforcement of the ECSC pricing rules is concerned, non-conforming firms are disciplined by the High Authority.Competitive pressures from the outside and an enduring rivalry between national groups prevented a smooth functioning of the system. Increasingly private enterprise has substituted for the Treaty rules by reviving cartels and other forms of cooperation.

Notizen: It is desirable and important in the discussions on international monetary arrangements to assess the future trends of gold production under different assumptions. The article reviews past gold production, showing that there has been a large increase in physical gold production in the Free World, but despite the addition of substantial Russian sales, the increments to official monetary stocks has dwindled to nothing, because of the increasing amounts added to unofficial stocks.In the absence of any price change Free World gold production is likely to fall rapidly after 1971, and with the propensity to add to hoards unchanged official monetary stocks are likely to fall. With a revaluation of gold through doubling its price adequate increments to official monetary stocks are likely to be available from new production and releases from unofficial stocks until after 1980, after allowing for the resumption of hoarding in the traditional fashion. There is no reason to believe that with an adequate price adjustment gold production will not be sufficient to feed official monetary stocks.

Notizen: Book reviewed in this ArticleAnstey, Vera, and Martin, Anne. An Introduction to Economics-For Students in India and Pakistan.Baxa, Jakob. Adam Müllers Lebenszeugnisse.Bergler, Reinhold (Ed.). Psychologische Marktanalyse.Campbell, Robert W. Soviet Economic PowerCohen, Benjamin J. Adjustment Costs and the Distribution of new ReservesCoutsoumaris, G., Westebbe, R. M., Psilos, D., Michalakis, A., and Xanthakis, N. Analysis and assessment of the economic effects of the U. S. -PL 480 Programm in GreeceFriedmann, Karen J. German Grain Policies and Prices:Gurvitch, Georges. The Spectrum of Social Time.Heide, Holger. Die langfristige Wirtschqftsplanung in SchwedenHelleiner, Karl F. The Imperial LoansHershlag, Z. Y. Introduction to the Modern Economic History of the Middle East. LeidenHicks, John. Capital and Growth.ISEA. Planification et analyse économiquesJohri, C. K. Monetary Policy in a Developing EconomyJoint Economic Committee (Congress of the United States). New Directions in the Soviet EconomyKiss, Gábor. Gibt es eine ≪marxistische≫ Soziologie?Lebrecht, Robert G. Automatische Konjunkturstabilisatoren oder be-wusste Konjunkturpolitik ?Leontief, Wassily. Input-Output Economics.Malinvaud, E. Statistical Methods of EconometricsMartin, Alfred VON. Mensch und Gesellschaft heute.Neufeld, Maurice F. Poor Countries and Authoritarian Rule.Ølgaard, Anders. Growth, Productivity and Relative Prices.OulÈs, F. Economic Planning and Democracy.Popper, Karl R. Logik der Forschung.Robinson, Joan. Economics—An Awkward Corner.SachverstÄndigenrat zur Begutachtung DER GESAMTWIRTSCHAFTLICHEN Entwigklung. JahresgutachtenSeitz, Tycho. Preisführerschaft im Oligopol.Tamagna, Frank. Central Banking in Latin America.Theil, Henri. Economics and Information TheoryTilly, Richard. Financial Institutions and Industrialization in the RhinelandTouraine, A. (et al.). Workers’ Attitudes to Technical ChangeTullock, Gordon (Hrsg.). Papers on Non-Market Decision Making.Yeager, Leland B. International Monetary Relations; Theory, History and Policy.Young, John Parke. United States Gold Policy: The Case for Change

Notizen: Rather than to approach technology within the framework of production function as a type of residual factor input, this paper attempts to develop transfer of technology functions. Using data based on post-war experience of Japan, the issue is raised: how to facilitate the transfer of technology (absorption function). At the same time, an effort is made to identify and measure the relationship between the growth of output produced by the application of new borrowed technology and a group of significant explanatory variables (impact function).The absorption regression indicates that explanatory variables which facilitate a society's ability to absorb technology are mainly some combination of quantifiable measures of: 1. educational and technological niveau, 2. society's planned and predetermined effort to raise this niveau, 3. coordinated policies of government guidance in the induction of productive types of technology, as well as 4. availability of channels for intake of information about foreign technology and markets for new goods abroad (i. e. antennae). Findings of the two impact functions indicate a strong correlation between the growth in foreign and domestic sales of goods produced with new borrowed technology and two major explanatory inputs. On the one side, a nation's own effort to elevate the technological level of production processes stands out prominently; on the other hand, the visible indicators of induced technology (e. g. import of technically advanced machinery and raw materials reflecting new productive processes) figure prominently as major contributory factors. The question of which input contributes more or less to technological transfer and its impact is not being raised, because it is in some sense irrelevant. What is held, in effect, is that the transfer of technology is governed by a complex of factors which create a setting or an institutional milieu conducive to the transfer mechanism and its impact.

Notizen: In this paper an effort is made to pull together different strands of thinking on the subject of portfolio selection in recent literature. In order to make explicit relationships which are difficult to state verbally a simple model is set up which accounts for a number of factors influencing portfolio selection. The model is a certainty-equivalence type model as developed by Tobin and by Markowitz. With its aide it is possible to indicate the general directions of shifts in portfolio composition if there are changes in the market rate of interest (effect stressed by the so-called ‘New Theory of Credit Control’), a change in the yield differential between á low-yield, low-risk security and a high-yield, high-risk security (effect investigated by Warren L. Smith), a change in risk aversion (effect investigated by D. E. Farrar and others) and a change in total loanable funds available (effect investigated by B. G. Malkiel and J. Kane). In addition, the effect of a proportionate income tax with and without loss-offset provisions on portfolio composition is shown.

Notizen: Book reviewed in this ArticleAbraham, C., et Thomas, A. MicroéconomieBaldwin, John W., and Greenfield, Kent Roberts (eds.). Venice and HistoryCoontz, Sydney H. Productive Labour and Effective DemandGeorgesgu-Roegen, N. Analytical Economics — Issues and Problems —Goldfeld, Stephen M. Commercial Bank Behavior and Economic Activity —Gordon, R. A., und Klein, L. R. (Hrsg.). Readings in Business Cycles.Heuss, Ernst. Allgemeine Markttheorie.Hobhouse, L. T. Sociology and Philosophy —JaffÉ, William (Hrsg.). Correspondence of Léon Walras and Related Papers.Jensen, Finn B., and Walter, Ingo (Eds.). Readings in International Economic Relations. New York 1966. Ronald Press Company, 528 pp. $6.50Kantzenbach, Erhard. Die Funktionsfähigkeit des WettbewerbsKrippendorff, Ekkehart (Hrsg.). Political Science —Landwehrmann, Friedrigh. Organisationsstrukturen industrieller Grossbetriebe.Linnemann, HansAn Econometric Study of International Trade Flows.Linnemann, H., Pronk, J. P., and Tinbergen, J. Convergence of Economic Systems in East and West.Lipsey, Richard G., and Steiner, Peter O. Economics.Little, I. M. D., and Clifford, J. M. International AidLowe, Adolph. On Economic KnowledgeMitchell, Broadus. Great Economists in Their Times.Morgenstern, Oskar. Spieltheorie und Wirtschqftswissenschaft.Mueller, M. G. (Hrsg.). Readings in Macroeconomics. New York, Chicago, San Francisco, Toronto, London 1966. Holt, Rinehart and Winston. 402 S. $ 5.95Pontifical Academy OF Sciences. The Econometric Approach to Development Planning.Rieber, Heinrich, und Kölner, Lutz (Hrsg.). Währungspolitik in der europäischen Integration.Schaller, Howard G. (Hrsg.). Public Expenditure Decisions in the Urban Community.Schneider, Erich (Hrsg.). Internationale WährungsproblemeSchneider, Erich (Hrsg.). Probleme der EinkommenspolitikShonfield, Andrew. Modern CapitalismStolper, Wolfgang F. Planning Without FactsThalberg, BjÖrn. A Trade Cycle Analysis. The Market Economy in Western European Integration.Triffin, Robert (et al.). International Trade and FinanceTriffin, Robert. The World Money MazeVosgerau, Hans-JÜrgen. Über optimales wirtschaftliches Wachstum.

Notizen: The public good ‘internal security’ is not absolutely indivisible. To a certain degree it is possible to differentiate between the actual good, its supply and demand, just as to exclude from consumption. This opens a door to a widely neglected efficiency analysis in this classical field of state activity.Neither the private market mechanism nor the political decision-making process seem to be practicable instruments. A solution based on a social welfare function appears equally unsuited. Therefore cost-benefit must be applied as a means of calculating efficiency, if the public good ‘internal protection’ is sensibly defined in the broadest sense that is according to functional, personal, regional, temporal, and sociological viewpoints or in terms of purveyor and recipient of public security, expressed in monetary or technical units.Success or failure in calculating efficiency of internal order and protection depend above all on whether(a) the particular kinds of public safety (life, health, honesty, freedom and property) are comprehensible and definable;(b) the several components (projects) are comparable and(c) the indices of cost and benefit stand in reasonable relationship to each other, which of course does not mean that this connection must be ‘monocausaP and linear.The author evaluates criteria for measuring the benefits and costs. Some empirical analyses reveal the possibilities and limitations of these quantitative methods and legal institutions. At the end, in the field of police, the author shows the ways and means to increase efficiency in the political and administrative process.

Notizen: At present regional economics does not yet possess the theoretical tools needed to solve the problems of unequal regional growth arising in the context of the development of backward countries. According to the so-called ‘Equalization Doctrine’ the elimination of the spatial differences in economic growth is possible only by the adoption of a policy tackling with all regions and sectors in one all-embracing action. Regarding the limited resources of the developing countries, however, this advice seems not to be of practical value.-With this state of affairs it is tempting to enquire for inducement-mechanisms conveying impulses of economic development from ‘leading regions’ or ‘growing points’ of a country to its lagging areas. Starting from HIRSCHMAN'S general ideas on unbalanced development, the author embarks on a discussion of PERROUX’‘Theory of Development-poles’. An attempt is made to make PERROUX’ hypothesis more workable in defining effects of economic, institutional, psychological, and geographical polarization. The role of these effects as inducement-mechanisms stimulating regional economic development is broadly analyzed. Special attention is paid in this context to the complementarity-effects which are characterized as being powerful sequences of industrialization either in their working via technological interrelations or via market-decisions. Comments concerning the possibilities of promoting small-scale industries in the ‘polarized region’ and some remarks on the maximization of polarization-effects by optimizing the development-pole's set of industries constitute the final part of this essay in unbalanced regional development.

Notizen: Leontief's test of factor proportions was based on the assumption that, within each U. S. industry, the same factor proportions are used to produce exports, domestic goods, and import substitutes. However, if the Heckscher-Ohlin theorem is valid, then, within each industry, commodities exported by the U. S. would be charac terized by a higher capital-labour ratio than those produced to replace imports. Unless the industry classification used is such that it does not allow for both exports and import substitues to be grouped together, the validity of the Heck scher-Ohlin theorem precludes the possibility of factor proportions being homo geneous in the manner assumed by Leontief.In support of this argument it is claimed that Leontief's own data can be consistent with the traditional theorem. Using Israel input-output data it is shown also that the strength of the Paradox increases with the degree of aggregation.

Notizen: This lecture on some problems araising from the international economic relations of developing countries, delivered in a developing country aims at giving a concise compendium of the principal propositions and findings of recent international trade theory. Particular emphasis is lied on the importance of pulling together commercial policy, foreign exchange policy and fiscal policy (internal taxes and subsidies) in a comprehensive scheme which was qualified by HarryH. Bell, Research Director of the UNCTAD, as a ‘unified theory of protection’. In fact, the author, who is working in the praxis of international monetary and financial questions but likes personally to make ‘excursions’ to international trade theory and public finance, felt compelled to break down the artificial compartmentalization between the various sub-disciplines of political economy. A first attempt of this kind necessarily cannot go down into all details and necessarily rests to be completed.On this conceptual background the paper deals with the influence of inflation on development, fixed versus floating rates, tariff arguments, the attempt to construct a scientific tariff, the costs of selfsufficiency, the combined net effective rate of protection, quantitative restrictions and monetary trade biasing, the question whether import restriction or export promotion, invisibles in a unified theory of protection, capital movements and multiple exchange rates, the influence of the taxation system on relative prices and exchanges and last but not least the skeleton of a typical reform program. Admittedly, in praxis there will be as long difficulties concerning the application of the projected scientific system of protection as long as no one seems to have elaborated a satisfying empirical method in which tariffs, exchange rates and fiscal instruments are all expressed in terms of comparable units on a comparable scale. But does this matter? Praxis will follow theory.

Notizen: That advertising and other sales promotion increases consumption and the propensity to consumes is commonly assumed by both economists and trade apologists. But because promotion demonstrably increases demand for particular products and brands is not sufficient evidence that it increases aggregate demand. Rather, promotion might only redistribute purchases among products and brands. This paper considers the plausibility of the possibilities that promotion does and does not affect the propensity to consume, adducing both argument and empirical evidence. There is a slight amount of shaky evidence to suggest that, on balance, promotion does affect consumption levels.

Notizen: In comparing Marshallian and Walrasian stability criteria, opposite stability conditions are found when both demand and supply curves are downward sloping. This paper resolves the inconsistency by considering a behavioral model of the firms in a competitive industry and then specifying the conditions under which the relevant instantaneous adjustment processes will result in stability at the industry level.It turns out that the concept of the representative firm is inadequate for a considerations of the stability of industry equilibrium. Moreover, for different reasons the Walrasian adjustment process is applicable only when all firms are operating on the rising portion of their marginal cost curves. Hence, in the only situation in which the Walrasian and Marshallian processes adequately represent the dynamics of competitive industry (namely rising marginal cost curves for all firms) they lead to identical stability conditions.

Notizen: Book reviewed in this ArticleArndt, H. Mikrookonomische TheorieArrow, K. J. Aspects of the theory of risk bearing.Baran, P. A., und Sweezy, P. M. Monopoly Capital. An Essay on the American Economic and Social Order.Beckerman, W., und andere. The British Economy inBrÉmaud, Guy. Etude structurelle de la croissance en économie ouverte.CEMLA. Aspectos financieros de las economias latinoamericanasClaassen, Emil M. (Ed.). Les fondements philosophiques des systèmes économiquesCornelisse, Peter A. The Educational Structure of the Labor Force: A Statistical Analysis.Dell, Sidney. A Latin American Common Market?Fellner, William; Machlup, Fritz; Triffin, Robert, and Eleven Others. Maintaining and Restoring Balance in International Payments.Fleischmann, G. Nationalökonomie und sozialwissenschaftliche Integration.Hanumantha Rao, C. H. Taxation of Agricultural Land in Andhra Pradesh.Harrod, Roy F. Reforming the World's Money.Huppert, Walter. Internationale IndustriekonzerneJanocha, Peter. Intervention und Kooperation der Zentralbanken auf den Devisenmärkten nach dem Zweiten Weltkrieg.Jarghow, Hans-Joachim. Theoretische Studien zum Liquiditätsproblem.KÖhler, Heinz. Welfare and Planning—An Analysis of Capitalism Versus Socialism.Krzyzaniak, Marian (Ed.). Effects of Corporation Income Tax—Kuby, Heinz. Provokation EuropaMarglin, Stephen A. Public Investment Criteria - Benefit-Cost Analysis for Planned Economic GrowthMeyer, Hans. Die kurzfristige internationale Kredithilfe.Musgrave, Richard A. Finanztheorie -O. E. C. D. The Public Employment Services and Management.Pallmann, Martin. Der Kibbuz —Pareto, V. Statistique et économie mathématique.Schnee, Heinrich. Die Hoffinanz und der moderne Staat.Schneeweiss, Hans. Entscheidutigskriterien bei Risiko.Sik, Endre. The History of Black AfricaStegemann, Klaus. Wettbewerb und Harmonisierung im Gemeinsamen Markt.Vernon, Raymond (Ed.). How Latin America Views the U. S. Investor.Wilkinson, Bruce W. Studies in the Economics of Education.Yakemtchouk, Romain. Assistance économique et pénétration industrielle des pays de l'Est en Afrique.

Notizen: Using data from Egypt's first five year plan the consequences of five different economic policies are explored. The model used is stochastic programming, the output/labor and output/capital ratios are considered as independently distributed normal random variables. The optimal allocation policy appears to be very close to the actual policy advocated for the plan.

Notizen: In this paper an attempt is made to use the methodology of economics and operations research for determining the optimum allocation of resources among different methods of preventing or curing diseases.First, after comparing the different indices proposed to measure the output of health services, a very simple one is adopted: the number of deaths. The objective of health planning is assumed to be the minimization of the number of deaths.Next, the optimum distribution of resources between prevention and cure of one particular disease is studied in some detail, and a numerical example is presented. Finally, the generalization of this model to include several diseases, under both static and dynamic conditions, is considered.

Notizen: The paper explores the incidence of restrictive monetary policy on firms of different market structures. It is argued that in the period of tight money, firms with backlogs are less likely to suffer a loss of sales or profit than those without backlogs because of the ability of the former to shift future production to the current period. Since firms with backlogs can only be found in the oligopolistic sector, we conclude that the burden of the restrictive monetary policy is more likely to fall on the firms in the competitive sector than those in the oligopolistic one.

Notizen: The main problem of underdeveloped countries consists in an inflexible productive structure which makes it difficult to adopt to changes in world markets. There are three important instruments to improve their flexibility.The first instrument are the investments - not investments in general (this is only of interest in the context of stabilization policies) but specific investment projects or programs. The author distinguishes directly and indirectly productive investments, which require separate investment criteria. For the latter especially the fact ought to be taken account of that they cause large future current expenditures, therefore absorbe future resources ahead of creating them.The second instrument is the budget. In underdeveloped countries its task is not only to finance the public services but also to accumulate savings. It becomes the link between the public and the private sectors as well as between directly and indirectly productive investments, and, by this, the main instrument for development.The third instrument is the balance of payment policy: avoidance of balance of payment crises and efficient use of export receipt. Its further tasks consist in creating public savings—a task that is very often underestimated compared to the infant industry argument or the directing of import and export.In the last part the author scrutinizes a special problem of planning a specific investment project: shadow or accounting prices (wages, interest rates, exchange rate). The theory implies that all investments are directly productive, which ist too simple. When shadow prices are adopted, the budgetary consequences are neglected. E.g. a project is chosen on grounds of low shadow wages, nevertheless market wages have to be paid. The difference is a charge on the budget. The possibilities of productive investment are reduced, the composition of directly and indirectly productive investments altered in favour of the latter, and economic growth diminished. The author therefore concludes that the adoption of shadow prices calculated from a static system might prove disastrous to future growth.The solution would consist in realizingall investment projects the rate of return of which would exceed the interest rate of, say, the World Bank (more or less opportunity cost of capital), and limiting investment in indirectly productive activities to what the budget can stand, in particular to an amount that does not foreclose future savings.