Social networks are typically constructed based on explicit and well-defined relationships among individuals. In this paper, we describe another class of social networks, known as Implicit Affinity Networks (IANs), where links are implicit in the patterns of natural affinities among individuals. An effective mathematical formulation of social capital based on implicit and explicit connections i...

Using a firm-level panel data set I assess whether dynamic models of investment provide an empirically fruitful framework for analyzing tax effects on changes in capital stock. In particular I estimate a one-step error correction model (ECM) complementing the usual estimation of a distributed lag model. A correction term accounts for non-random sample attrition, which has not been considered in...

OBJECTIVE This study aimed to evaluate the cost-effectiveness of varenicline compared with the other smoking cessation interventions, bupropion, nicotine replacement therapy (NRT), and willpower. METHODS The Benefits of Smoking Cessation on Outcomes model was modified to reflect major smoking-related diseases in Korea. Transitional probabilities, resource utilization, and costs were obtained ...

This paper analyses the optimal transition from dirty to clean capital when investment is irreversible. The cost of the transition has two components: the technical cost of investing in clean capital instead of polluting capital, and a temporary irreversibility cost. With a carbon price, the irreversibility cost can be reduced by under-utilizing polluting capital. By preventing under-utilizatio...

We propose a process algebra which is concerned with processes that have an implicit computational capital. This process algebra goes along with the development that the behaviour of computer-based systems, persons and organizations is increasingly more related to money handling. It is intended to be helpful when designing systems of which the behaviour is related to money handling.

This paper analyzes the economic foundations of a one-party political regime, where the ruling bureaucracy captures rents through collective control over state property and job assignment. Stability of such a regime and the potential for endogenous institutional change are key issues in the transition to market economy and democracy in former socialist and many developing countries. Our model o...

The response of business capital to user costs is central to economic evaluations of tax and monetary policies. Despite intensive research effort though, no consensus about the size of this elasticity has been achieved. The divergence in prior estimates may arise because previous studies have neglected cointegration among capital, its user costs, and sales. Using German firm-level panel data, t...

This paper analyzes how human capital and economic uncertainty affect capital structure and managerial compensation. We model a competitive industry where wealth constrained managers provide human capital that can be transferred across firms, and where equityholders give managers access to the physical assets of the firm. Equityholders and managers bargain for the firm’s stochastic free cash fl...

In a widely cited article, DiMasi, Hansen, and Grabowski (2003) estimate the average pre-tax cost of bringing a new molecular entity to market. Their base case estimate, excluding post-marketing studies, was $802 million (in $US 2000). Strikingly, almost half of this cost (or $399 million) is the cost of capital (COC) used to fund clinical development expenses to the point of FDA marketing appr...