With increasing networking and globalization of the market, it becomes increasingly difficult to understand value in production of goods and services. This paper presents a new methodology for modelling value creation based on the concept of Emergent Synthesis. In consideration of interaction among producers, customers, and the environment, the methodology classifies value creation into three m...

An important element of the cost of distance is time taken in delivering final and intermediate goods. We argue that time costs are qualitatively different from direct monetary costs such as freight charges. The difference arises because of uncertainty. Unsynchronised deliveries can disrupt production, and delivery time can force producers to order components before demand and cost uncertaintie...

This paper develops the idea that obsolescence acts as an incentive device to provide quality for experience goods. The argument is that obsolescence affects the frequency at which consumers repurchase products and may punish producers for a lack of quality. A higher rate of obsolescence enables a firm to convince its consumers that it provides high quality. We identify a trade–off between qual...

We construct a Schumpeterian growth model of a common market with following properties. Households can stay as workers or become researchers at some cost. Workers are employed in production and researchers in R&D. Workers are unionized. Intermediate goods are substitutes and their producers are strategically interdependent. The main findings are as follows. Both union power and economic integra...

This paper investigates a claim of Hicks that the area to the left of a market demand curve—calculated by assuming that other markets are in equilibrium—is equal to the aggregate overall Dupuit–Marshall consumers’ surplus together with producers’ surplus in other markets, and extends it to general equilibrium in an economy with a competitive private sector. The usefulness of the result is quest...

We show that introducing an external capital market with information asymmetry into a product market model reduces opportunistic substitution of sub-standard goods and encourages producers to concentrate on long-run reputation building. We test this result with a laboratory experiment. We find that, when the problem of product market opportunism is moderate, i.e., reputation formation equilibri...

1. Global declines in biodiversity have stimulated much research into the consequences of species loss for ecosystems and the goods and services they provide. Species at higher trophic levels are at greater risk of human-induced extinction yet remarkably little is known about the effects of consumer species loss across multiple trophic levels in natural complex ecosystems. Previous studies have...

Recent results on the relationship between external economies and local public goods may be summarised as follows. Marshallian are at core of paths development in vital productive systems, such industrial districts or similar forms. They partly to resources organized by single specialised firms largely dependent embeddedness firm system its various forms division labour. Exchanges need integrat...

This paper tests the proposition that Russian nominal prices were distorted to support bankrupt sectors, which is the foundation of the virtual economy. The input-output table for 1997 is converted from rubles into dollars using American prices as shadow values. Three sectors belonging to the intermediate stage of processing are found to have negative value-added. An alternative measure of the ...

This paper considers the implications of relationship-specific investment within keiretsu for policies aimed at opening the Japanese market for intermediate goods, such as auto-parts. Both VIEs applied to parts and VERs restricting Japanese exports of autos cause the keiretsu to import a wider range of parts, but of a relatively unimportant type, such as seat covers. Since keiretsu investment a...