Property Rights and Welfare Economics: Miller et al. v. Schoene Revisited
The authors of the present comments have directed their attention to several points in our analysis of the case of Miller et al. v. Schoene. The purpose of our attempt at a diagrammatic exposition of the case was to ultimately illuminate the nature of choices open to society in utility space. While both have valid criticisms, it is unfortunate that neither attempted to fully explore and demonstrate the implications of their recommendations and suggestions on the grand utility frontiers. Following their lead we will specificially respond to their several comments sequentially:
Property Rights and Welfare Economics: Miller et al. v. Schoene Revisited: Comment
In a recent article in this journal (Mercuro and Ryan 1980), the authors (hereafter M-R) claim to demonstrate with the aid of a numerical example that the 1914 Cedar Rust Act of the Virginia legislature (hereafter the Act) could have resulted in a twist of the product transformation curve. M-R then demonstrated that a twist in the product transformation curve would also cause the pre-Act and post-Act utility frontiers to cross. This led them to conclude that the Act:
Complexity, Network-Decisions And Alternative Risk Premia: Some New Theories Of Structural Change And Portfolio Decisions.
Structural Change is the basis for many decisions such as government fiscal and monetary policies, government interventions, corporate-expenditure decisions, corporate strategic decisions, portfolio management decisions in finance; household allocation decisions, etc.. Structural change in industries and national economies is increasingly more difficult to detect partly because of the growth and dominance of Complex Systems and “Networks” in modern industries and economies – such Networks and Complex Systems include GVCs (global value chains), retail store networks; franchising networks; internet networks; services networks; credit-chains in industries; online social networks; etc.. The relationship between Complexity and Structural Change is well established in the physics, applied math and economic dynamics literatures. Traditional definitions and modeling of structural change have erroneously focused on changes in labor, technological progress, market share, and or capital – which are grossly inadequate in the new economy and post- global financial crisis (as confirmed by changes in the global retailing and housing industries and other industries). Also the modeling of structural change seems to be constrained by the availability of data, and often omits the relationship between structural change on one hand, and globalization, financial stability and international financial contagion. This article: i) introduces the Operations Strategy Model of structural change, explains how it differs from the Lewis Model of Structural Change; and explains the often omitted relationship between operations strategy (of companies and government agencies) and structural change; ii) introduces other new Complexity-based models/theories of Structural Change in industries; iii) reviews the relationships among Operations Research, Complexity and Structural Change; iv) explains the symbiotic relationship between structural change on one hand, and economic growth, financial stability, financial contagion and globalization; v) discusses the significant gap between academic research and practice and explains some issues and factors that should be considered in the development and testing of structural change models; vi) explains how alternative risk premia can be generated from new models of Structural Change.