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perfection has been achieved the individual will aim for higher quality since the effort is more likely to be worthwhile. Because … standards may nonetheless decline. This mechanism is captured in an oligopoly model, where the failure rate and the quality are …
Persistent link: https://www.econbiz.de/10005666828
This paper surveys major empirical regularities concerning changes in earnings inequality in Europe and the US over the past 25 years. Next, it indicates which of these regularities can be explained within the competitive demand-supply framework of analysis and what is left unexplained. Finally,...
Persistent link: https://www.econbiz.de/10005792213
wage countries will export goods intensive in skilled labor (a hierarchy is proposed from 'expensive', skilled …
Persistent link: https://www.econbiz.de/10005666823
We propose and solve a simple model of firm-level decisions to offshore production stages of lower skill intensity than that of activities that remain in the domestic location. In theory, offshoring is optimal only for the more productive among heterogeneous firms if it entails a fixed cost. In...
Persistent link: https://www.econbiz.de/10005792450
Gains from productivity and knowledge transmission arising from the presence of foreign firms has received a good deal of empirical attention, but micro-foundations for this mechanism are weak. Here we focus on production by foreign experts who may train domestic unskilled workers who work with...
Persistent link: https://www.econbiz.de/10005124316
We apply a simple method to study the relative quality of Chinese versus European products exported in the clothing … change of export prices and quantities sold in narrowly defined product categories as an indicator of quality shifts. Using … indication of China moving up the quality ladder in its clothing exports relative to the EU. While European ‘core’ products in …
Persistent link: https://www.econbiz.de/10009399710
This paper characterizes price competition between an expert and a non-expert. In contrast with the expert, the non-expert’s repair technology is not always successful. Consumers visit the expert after experiencing an unsuccessful match at the non-expert. This re-entry affects the behaviour of...
Persistent link: https://www.econbiz.de/10005662068
providers of contents incentives to invest in higher quality and, as a result, force competitors to reduce their prices …
Persistent link: https://www.econbiz.de/10005789055
We present a model of optimal contracting between a purchaser and a provider of health services when quality has two … dimensions. We assume that one dimension of quality is verifiable (dimension 1) and one dimension is not verifiable (dimension 2 … quality 1 increases or decreases the provider's marginal disutility and the patients' marginal benefit from quality 2 (i …
Persistent link: https://www.econbiz.de/10005791404
-stage model with quality choice made before price competition takes place, we show that EU anti-dumping policy that takes the form … impact of the A-D policy on quality choices is taken into account, European Welfare as well as profits accruing to the …
Persistent link: https://www.econbiz.de/10005791460