Quantum Propensity in Economics

This paper describes an approach to economics that is inspired by quantum computing, and is motivated by the need to develop a consistent quantum mathematical framework for economics. The traditional neoclassical approach assumes that rational utility-optimisers drive market prices to a stable equilibrium, subject to external perturbations or market failures. While this approach has been highly influential, it has come under increasing criticism following the financial crisis of 2007/8. The quantum approach, in contrast, is inherently probabilistic and dynamic. Decision-makers are described, not by a utility function, but by a propensity function which specifies the probability of transacting. We show how a number of cognitive phenomena such as preference reversal and the disjunction effect can be modelled by using a simple quantum circuit to generate an appropriate propensity function. Conversely, a general propensity function can be quantized, via an entropic force, to incorporate effects such as interference and entanglement that characterise human decision-making. Applications to some common problems and topics in economics and finance, including the use of quantum artificial intelligence, are discussed.

Social Innovation for Work Inclusion – Contributions of Swedish Third Sector Organizations

The innovative contributions of third sector organizations (TSOs) to tackle work-related societal challenges are increasingly acknowledged in policy and research, but rarely in Nordic working life studies. The article helps fill this knowledge gap by an empirical mapping of efforts by Swedish TSOs to promote work inclusion among people considered disadvantaged in the regular labor market, due to age, disabilities, origin, etc. Previous studies of social innovation help distinguish their innovativeness in terms of alternative or complementary ways to perceive and promote work inclusion in regard to Swedish labor market policies. By combining various measures for providing and preparing work opportunities, addressing their participants through individualistic and holistic approaches, and managing work inclusion by varying organization, funding, and alliances, the mapped cases seem to innovatively compensate for government and market failures in the work inclusion domain to some extent, while also being limited by their own voluntary failures.

Catch-Up Development VS. Forward-Looking Development: from Theoretical Models to Developmental State Practices

The presented article was carried out within the framework of scientific project dedicated to Russia's participation in the export and import of institutions. The solid question arose that the conditions and specificity of Russia's place in these processes are related to its position in the global world economy. These problems are considered within the framework of competing concepts of catch-up and forward-looking development in the economic literature. Comparative characteristics of methodological foundations, provisions and normative recommendations of these concepts are highlighted in the article. The analysis shows that there is no ground to justify the absolutization of their differences. Representatives of competing approaches came to the conclusion that it was necessary to search for the optimal configuration of imported and genuine institutions at the level of specific problems of development of countries that were largely on the periphery of the modern global economy. This configuration provides productive orientation of economic actors and creation of favorable conditions for the development of Schumpeterian type innovations. The solution of these tasks is linked with the formation and activities of developmental state. The functions of such a state are fundamentally different from compensating market failures that is characteristic of developed market economy. Such a state acts as a subject that forms the basic institutions of the economic system. Fundamental importance is its ability to ensure the combination of selective imports of institutions with the modification of genuine institutions that have historical and cultural specificity. Characteristics of the reasons and conditions for the successful solution of these tasks by countries such as Japan, Taiwan and South Korea, are highlighted in the article. The success stories are compared to the experience of partial failure of developmental state in Brazil. The fulfilled study is of interest not only for positive analysis, but also for the elaboration of normative recommendations for the formation of optimal configuration of imported and genuine institutions in contemporary Russia.

Broadband Connectivity, Government Policies, and Open Innovation: The Crucial IT Infrastructure Contribution in Scotland

Broadband connectivity is now essential to ensure a competitive advantage for any business. The analysis of Scotland’s crucial IT infrastructure contribution supported the authors’ thesis that the Government plays a decisive role in Open Innovation ecosystems. Indeed, IT infrastructures are a clear case of market failure where remote areas will never be served by adequate connectivity without public support. The main contribution is the demonstration that the benefits of public intervention are sometimes required and beneficial to correct market distortions and generate positive spillovers in terms of collaboration in Open Innovation ecosystems. Another relevant contribution is a comprehensive analysis of the consistency of the evolution of the public policies that supported the IT Infrastructure in Scotland. Therefore, pivotal is the study of this case study that can be easily generalised to many other contexts where the Government addressed market failures and, at the same time, contributed to generating collaborative environments.

Environmental Regulations and CO2 Mitigation for Sustainability: Panel Data Analysis (PMG, CCEMG) for BRICS Nations

The relationship between income and pollution is contested, yet wealth alone is insufficient to regulate emissions, which necessitates environmental regulations. Even if inadequate environmental laws may overcome market failures produced by pollution’s negative externality, a thorough examination of their function in pollution management is critical. This research takes a step forward in offering a fresh viewpoint on the function of environmental laws in pollution reduction for BRICS (Brazil, Russia, India, China, and South Africa) nations to better understand the role of environmental regulations in CO2 emission mitigation. The research presented here uses panel data econometric methodologies to achieve this goal, using data from 1995 to 2018. In addition, to provide country-specific findings, the research employs a completely modified ordinary least squares estimator. Environmental laws provide a beneficial influence in reducing carbon emissions. According to the empirical findings, the present environmental regulation positively meets pollution reduction objectives in chosen nations. The environment Kuznets curve (EKC) between pollution and income is controlled by environmental restrictions. Climate change mitigation in BRICS nations is driven by strong environmental policies and economic growth.

Venture capital and government involvement from a qualitative systematic literature review perspective

The financing of young start-up companies is hindered by market failures that prompt governments around the world to intervene at the venture capital market. The aim of this paper is to give a comprehensive overview on this research field based on sound systematic literature review methodology, which was never done before. We found three major themes: pure governmental venture capital involvement, governmental-private venture capital cooperation, and governmental involvement in the financing of pre-seed startups. The evaluation of the governmental efforts varies according to these themes and also the investigated geographic location. Generally, pure governmental venture capital is the most controversial theme, the government-private cooperation is mostly viewed in a positive light, while the authors almost unanimously praise the government’s efforts when financing pre-seed startups. We found that the success of governmental venture capital should not be judged based on the realized return of its investments, since profit maximalization is not its goal. The governments try to alleviate market failures at the venture capital market and transition financed startup companies to private financing. Thus, we advise researchers to use the number of this type of successful transitions as the success criteria of governmental investments.

Productive Development Policies in the Mining Value Chain: Policy Opportunity and Alignment

Natural resources are an important source for development, and Latin America is one of the regions with the highest endowment. This calls for a reconsideration of resource-based development. Ambitious countries are moving toward high-value activities and more diversified economies to continue moving up the development ladder. In this sense, the resurgence of industrial policy can correct market failures and lead to the implementation of mission-oriented policies. This document analyzes opportunities to design and implement integrated policies through a revised taxonomy of mining-related policies, applying it to Australia, South Africa, and Chile. The mining sector has been a fertile field, characterized by high technology niches, growth, and innovation. Demand and supply policies can shape the path for development within the sector and across the economy due to the potential of vertical and horizontal linkages.

Cooperative Development: Sustainability Agricultural Planning Viewed Through Cooperative Equilibrium Management Theory in Togo, Africa

Cooperative economics looks at market failures as areas for development. The cooperative development process, however, requires member engagement or cohesion in the process according to the Cooperative Management Equilibrium Theory. This cohesion requires an awareness and understanding by the cooperative members of the market failure to develop the capacity to address the failure. This article looks at the effects of government agricultural programs on economic, environmental and social sustainability. The questions we ask is how does a focus on economic development push against social and environmental sustainability within the agricultural sector in Togo? Does member cohesion within a cooperative represent a form of Polanyian double movement through social and environmental cohesion? The current development models utilize what Sen refers to as an austere mode of development which forgoes social or environmental considering them luxuries. Does the focus of economic development build capacity only for economic performance within the Togo agricultural sector at the expense of social and environmental sustainability? Utilizing Deep Participatory Indicator Approach (DPIB) approach this paper examines the economic, environmental and social indicators within two prefectures in the Plateaux Region of Togo. Indicators were separated to show the differences between individual or cooperative producers. As cooperatives it was anticipated that a greater emphasis on social and environmental sustainability would be created through cohesive social action. This study found that the emphasis on economic development included in government programs built development capacity within cooperatives emphasizing their cooperative market cohesion.

Business Cycles and Apprenticeships

The economic reasons why firms engage in apprenticeship training are twofold. First, apprenticeship training is a potentially cost-effective strategy for filling a firm’s future vacancies, particularly if skilled labor on the external labor market is scarce. Second, apprentices can be cost-effective substitutes for other types of labor in the current production process. As current and expected business and labor market conditions determine a firm’s expected work volume and thus its future demand for skilled labor, they are potentially important drivers of a firm’s training decisions. Empirical studies have found that the business cycle affects apprenticeship markets. However, while the economic magnitude of these effects is moderate on average, there is substantial heterogeneity across countries, even among those that at first sight seem very similar in terms of their apprenticeship systems. Moreover, identification of business cycle effects is a difficult task. First, statistics on apprenticeship markets are often less developed than labor market statistics, making empirical analyses of demand and supply impossible in many cases. In particular, data about unfilled apprenticeship vacancies and unsuccessful applicants are paramount for assessing potential market failures and analyzing the extent to which business cycle fluctuations may amplify imbalances in apprenticeship markets. Second, the intensity of business cycle effects on apprenticeship markets is not completely exogenous, as governments typically undertake a variety of measures, which differ across countries and may change over time, to reduce the adverse effects of economic downturns on apprenticeship markets. During the economic crisis related to the COVID-19 global pandemic, many countries took unprecedented actions to support their economies in general and reacted swiftly to introduce measures such as the provision of financial subsidies for training firms or the establishment of apprenticeship task forces. As statistics on apprenticeship markets improve over time, such heterogeneity in policy measures should be exploited to improve our understanding of the business cycle and its relationship with apprenticeships.