scholarly journals Restrictions for different functional forms of the matching function

SERIEs ◽  
2019 ◽  
Vol 11 (1) ◽  
pp. 105-113
Author(s):  
Ausias Ribó ◽  
Montserrat Vilalta-Bufí
Keyword(s):  
Upper Bound ◽  
Returns To Scale ◽  
Matching Function ◽  
Free Entry ◽  
Filling Rate ◽  
Increasing Returns To Scale ◽  
Functional Forms ◽  
Search And Matching Model ◽  
Job Finding ◽  
Constant Returns To Scale

Abstract We provide bounds on the parameters of matching functions such that the job-finding rate and the vacancy-filling rate are below 1. We do that in the context of the canonical search and matching model with a Pissarides-type free-entry condition. We find that the restrictions for a Cobb–Douglas matching function with increasing returns to scale are rather restrictive, involving an upper bound to future expected profits and the number of job searchers. In contrast, for functional forms with constant returns to scale (Cobb–Douglas, CES) the restrictions involve only parameters or an upper bound to the future expected profits. The paper also investigates when a job-finding rate (vacancy filling rate) below one can restrict the vacancy filling rate (job-finding rate) to be below and strictly bounded away from one. We provide the bounds implied by these “interior equilibria.”

scholarly journals Indirect Network Effects and Adoption Externalities

2008 ◽  
Vol 7 (3) ◽  
Author(s):  
Jeffrey Church ◽  
Neil Gandal ◽  
David Krause
Keyword(s):  
Network Effects ◽  
Returns To Scale ◽  
Social Benefit ◽  
Software Systems ◽  
Free Entry ◽  
Private Benefit ◽  
Increasing Returns To Scale ◽  
Indirect Network Effects ◽  
The Social ◽  
Consumption Benefits

Can indirect network effects lead to adoption externalities? If so, when? We show that in markets where consumption benefits arise from hardware/software systems, adoption externalities will occur when there are (i) increasing returns to scale in the production of software, (ii) free entry in software, and (iii) consumers have a preference for software variety. The private benefit of the marginal hardware purchaser is less than the social benefit since the marginal hardware purchaser does not internalize the welfare improving response of the software industry, particularly the increase in software variety, on inframarginal purchasers when the market for hardware expands.

Comment on ‘Competition Tests with a Non-Structural Model: The Panzar–Rosse Method Applied to Germany’s Savings Banks’

2011 ◽  
Vol 12 (2) ◽  
pp. 239-241
Author(s):  
Manfred Neumann
Keyword(s):  
Public Interest ◽  
Structural Model ◽  
Monopolistic Competition ◽  
Returns To Scale ◽  
Increasing Returns ◽  
Free Entry ◽  
Recent Issue ◽  
Increasing Returns To Scale ◽  
The Public ◽  
Savings Banks

Abstract In a recent issue of this journal Gischer and Stiele (2009) applied the ‘Test for ‘‘Monopoly’’ Equilibrium’ advanced by Panzar and Rosse (1987) to German savings banks and came up with the claim that savings banks maximize profits under conditions of monopolistic competition in the meaning of Edward Chamberlin. Their proposition is not conclusive since it would require free entry and for savings banks to operate under increasing returns to scale. Available evidence, however, shows them being subject to constant or decreasing returns to scale. The empirical findings of Gischer and Stiele can more convincingly be explained by assuming savings banks abide by their legal goals to pursue the public interest.

scholarly journals Breaking Say’s law in a simple market economy model

2020 ◽  
Vol 39 (81) ◽  
pp. 897-918
Author(s):  
Carlos Humberto Ortiz Quevedo ◽  
Rodrigo Castillo Rentería
Keyword(s):  
Market Economy ◽  
Economic Activity ◽  
Capital Accumulation ◽  
Aggregate Demand ◽  
Returns To Scale ◽  
Increasing Returns ◽  
Market Size ◽  
Increasing Returns To Scale ◽  
Production Factors ◽  
Constant Returns To Scale

This paper analyses a multi-sector market economy where preferences are non-homothetic and satiable. Capital and labour are the production factors. Food and manufactured goods are produced with a constant-returns-to-scale technology and an increasing-returns-to-scale technology, respectively. Results include: an original capital accumulation process is required for manufacturing industrialization to take place, a minimum market size is needed for the economy to operate, and capital property concentration diminishes aggregate demand. Full general equilibrium is possible for intermediate degrees of capital concentration, but the price system collapses under high degrees as an economy regulator, labour unemployment is unavoidable, and a minimum wage is justified to enhance economic activity.

scholarly journals ARE VACCINATION SITES IN BANGLADESH SCALE EFFICIENT?

2003 ◽  
Vol 19 (4) ◽  
pp. 692-697 ◽  
Author(s):  
Vivian Valdmanis ◽  
Damian Walker ◽  
Julia Fox-Rushby
Keyword(s):  
Data Envelopment Analysis ◽  
Cost Effectiveness ◽  
Returns To Scale ◽  
Increasing Returns ◽  
Data Envelopment ◽  
Dhaka City ◽  
Increasing Returns To Scale ◽  
Multiple Outputs ◽  
Expanded Program On Immunization ◽  
Constant Returns To Scale

Objectives: The overall aim of this study is to discern whether and to what degree vaccination sites exhibit constant returns to scale.Methods: Data Envelopment Analysis is used to compare all the facilities in the sample in terms of input costs used to produce multiple outputs. The application considers the Expanded Program on Immunization (EPI), which operated in Dhaka City, Bangladesh, during 1999.Results: A preponderance of EPI sites were determined to be operating at increasing returns to scale.Conclusions: Our findings question the applicability of cost-effectiveness analyses that assume constant returns to scale.

scholarly journals Efficiency in Utilization of the Resources Allocated to Lower Level Health Facilities in Uganda: a Case Study of Health Centre IVs

2021 ◽  
Author(s):  
Expeditus Ahimbisibwe ◽  
Ezrah Trevor Rwakinanga ◽  
Christine Tashobya Kirunga
Keyword(s):  
Average Length ◽  
Health Centre ◽  
Returns To Scale ◽  
Health Sector ◽  
Increasing Returns ◽  
Scale Efficiency ◽  
Increasing Returns To Scale ◽  
Catchment Population ◽  
Quality Life ◽  
Constant Returns To Scale

Abstract Background: Everyone has a right to quality life with good health of the household and, thus, health sector financing should be a top priority because when the population is healthy, it is very productive and wealthy. In Uganda, Health Centre IVs (HCIVs) created under Uganda National Minimum Health Care Package provide curative, prevention and promotion services. The efficiency of these HCIVs is as critical as people’s health and this paper measures efficiency in utilization of resources allocated to them.Methods: The study used Hospital and HCIV Census data for 2014 and health sector data for FY2015/16 reported by MOH in the Annual Health Sector Performance Report. STATA software was used to perform Data Envelopment Analysis for a preferred model was out-put oriented that optimizes variable returns to scale. In this way, efficiency scores for every HCIV were calculated. Also, a Tobit regression model was run to estimate the factors contributing to the adjusted inefficiency scores for HCIVs.Results: Overall, 7 HCIVs (23.3%) were operating under constant returns to scale, implying that they were efficient (both pure technical and scale efficiency) while the 19 (63.3%) were operating under increasing returns to scale, implying that their health service outputs would increase by a greater proportion compared to any proportionate increase in health services if more inputs were added in the facility. Four HCIVs (13.3%) were operating at decreasing returns to scale meaning an additional input to the HCIVs would produce a less proportional change of outputs. The study identified catchment population, average length of stay, bed occupancy rate, and outpatient department visits as a proportion of inpatient days as the main factors of efficiency among HCIVs.Conclusions: This study has shown how Data Envelope Analysis methods can be applied at the HCIV level of the health system to gain an insight into variation in efficiency across health centers using routinely available data. And, with the majority of HCIVs operating at increasing returns to scale, it showed that there is a need to increase inputs like staff, medicines and beds to achieve the desired optimal scale in case of constant returns to scale.

scholarly journals Do traders learn to select efficient market institutions?

2021 ◽  
Author(s):  
Carlos Alós-Ferrer ◽  
Johannes Buckenmaier ◽  
Georg Kirchsteiger
Keyword(s):  
Returns To Scale ◽  
Production Costs ◽  
Switching Behavior ◽  
Double Auction ◽  
Trading Behavior ◽  
Market Institutions ◽  
Market Institution ◽  
Simple Rules ◽  
Rules Of Thumb ◽  
Constant Returns To Scale

AbstractWhen alternative market institutions are available, traders have to decide both where and how much to trade. We conducted an experiment where traders decided first whether to trade in an (efficient) double-auction institution or in a posted-offers one (favoring sellers), and second how much to trade. When sellers face decreasing returns to scale (increasing production costs), fast coordination on the double-auction occurs, with the posted-offers institution becoming inactive. In contrast, under constant returns to scale, both institutions remain active and coordination is slower. The reason is that sellers trade off higher efficiency in a market with dwindling profits for biased-up profits in a market with vanishing customers. Hence, efficiency alone might not be sufficient to guarantee coordination on a single market institution if the surplus distribution is asymmetric. Trading behavior approaches equilibrium predictions (market clearing) within each institution, but switching behavior across institutions is explained by simple rules of thumb, with buyers chasing low prices and sellers considering both prices and trader ratios.

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