CRIME AND UNEMPLOYMENT IN TURBULENT TIMES

We use the exceptional variation in municipality‐level unemployment in Sweden during the 1990s to identify the effect of unemployment on crime. Our findings are as follows: (i) There is a statistically and economically significant effect of general unemployment on the incidence of burglary, auto theft, and drug possession; (ii) we find no evidence for the popular view that youth unemployment matters for crime; (iii) prime‐aged unemployment is robustly correlated with main categories of youthful crimes, a finding consistent with the idea that unstable life conditions of parents have adverse spillover effects on the life‐choices of their children. (JEL: J00, K4)     

YOUTH UNEMPLOYMENT AND CRIME IN FRANCE

In this paper we examine the influence of unemployment on property crimes and on violent crimes in France for the period 1990 to 2000. This analysis is the first extensive study for this country. We construct a regional‐level data set (for the 95 départements of metropolitan France) with measures of crimes as reported to the Ministry of Interior. To assess social conditions prevailing in the département in that year, we construct measures of the share of unemployed as well as other social, economic, and demographic variables using multiple waves of the French Labor Survey. We estimate a classic Becker‐type model in which unemployment is a measure of how potential criminals fare in the legitimate job market. First, our estimates show that in the cross‐section dimension, crime and unemployment are positively associated. Second, we find that increases in youth unemployment induce increases in crime. Using the predicted industrial structure to instrument unemployment, we show that this effect is causal for burglaries, thefts, and drug offenses. To combat crime, it appears thus that all strategies designed to combat youth unemployment should be examined. (JEL: J19, K42, J64, J65)     

POLICE PATROL BEAT DESIGN: ALLOCATION OF EFFORT AND EVALUATION OF EXPECTED PERFORMANCE*

This paper describes an iterative process for deploying police patrol force manpower. An application of the process is described as a case study of the St. Louis County Police Department (Missouri). The application is based on the county geographic information system (COGIS) and uses the hypercube queuing model (HQM). The procedures presented illustrate the generation of performance characteristics associated with a specific beat deployment. The application results indicate that the iterative model presented is a reliable and valid instrument for allocating police patrols.     

AN APPROXIMATION TO THE HYPERCUBE MODEL WITH PATROL-INITIATED ACTIVITIES: AN APPLICATION TO POLICE

This paper applies the patrol-initiated-activity hypercube queuing model to historical data from a police agency. The model allows servers to handle both calls assigned by a central dispatcher and activities initiated by the servers. By duplicating a fairly complex dispatch strategy, the model was found to predict both assigned and server-initiated work loads accurately for the overall system and individual servers. The model is apparently ineffective in predicting small unit-travel-time differences for this police agency.     

ONE APPROACH TO REALLOCATING INSTRUCTIONAL RESOURCES: THE HOUSTON MODEL

In this paper a model for deciding which instructional departments should receive and surrender new or reallocatable resources is developed. It combines a two-dimensional assessment of resource needs based on instructional characteristics and the academic priority of the department to arrive at resource allocation priorities. Unusual features of the model are its reliance on judgments of departmental centrality to institutional mission as the discriminating variable in ascribing academic priorities and the careful avoidance of “halo effects” through independent assessment of resource needs and academic priorities. The model is sensitive enough to discriminate between competing claims for scarce resources while retaining a simplicity of logic that makes its mechanics understandable to those with little grounding in the decision sciences.     

A PLURALITY MAXIMIZING APPROACH TO THE ALLOCATION OF CAMPAIGN RESOURCES

An important problem in the planning of political campaigns is the allocation of resources to precincts and other geographical voting units in order to maximize a candidate's plurality. Essentially, parties may increase candidate plurality by engaging in registration drives, midcampaign activities such as canvassing and candidate appearances, and get-out-the-vote drives. Based on previous work which has related voter response to party identification, the authors develop a model for the optimal allocation of campaign resources to these activities. The computational feasibility of the solution procedure is made possible by a decomposition across activities.     

THE RISE OF THE EAST AND THE FAR EAST: GERMAN LABOR MARKETS AND TRADE INTEGRATION

We analyze the effects of the unprecedented rise in trade between Germany and “the East” (China and Eastern Europe) in the period 1988–2008 on German local labor markets. Using detailed administrative data, we exploit the cross‐regional variation in initial industry structures and use trade flows of other high‐income countries as instruments for regional import and export exposure. We find that the rise of the East in the world economy caused substantial job losses in German regions specialized in import‐competing industries, both in manufacturing and beyond. Regions specialized in export‐oriented industries, however, experienced even stronger employment gains and lower unemployment. In the aggregate, we estimate that this trade integration has caused some 442,000 additional jobs in the economy and contributed to retaining the manufacturing sector in Germany. This is almost exclusively driven by the rise of Eastern Europe, not by China. We also conduct an analysis at the individual worker level, and find that trade had a stabilizing overall effect on employment relationships.     

LINKING PROCESS CHOICE WITH PLANT-LEVEL DECISIONS ABOUT CAPITAL AND HUMAN RESOURCES

We examine how process choice links with design decisions about capital and human resources. Our analysis confirms empirically most expected differences between process- and product-focused plants for these decisions. What is unexpected is how top-performing plants resemble other plants within the same process choice category in most respects, while distinguishing themselves on a few selected process attributes. For example, better performing process-focused plants not only achieve higher machine flexibility levels and lower overhead costs as expected, but also have more intensive preventive maintenance programs. Similarly, product-focused plants that achieve certain hallmarks of process-focused plants also enjoy superior performance.     

CIVIL SOCIETY AND THE STATE: THE INTERPLAY BETWEEN COOPERATION AND MINIMUM WAGE REGULATION

In a cross‐section of countries, state regulation of labor markets is negatively correlated with the quality of labor relations. In this paper, we argue that these facts reflect different ways of regulating labor markets, either through the state or through the civil society, depending on the degree of cooperation in the economy. We rationalize these facts with a model of learning of the quality of labor relations. Distrustful labor relations lead to low unionization and high demand for direct state regulation of wages. In turn, state regulation crowds out the possibility for workers to experiment negotiation and learn about the potential cooperative nature of labor relations. This crowding out effect can give rise to multiple equilibria: a “good” equilibrium characterized by cooperative labor relations and high union density, leading to low state regulation; and a “bad” equilibrium, characterized by distrustful labor relations, low union density, and strong state regulation of the minimum wage.     

TPM: PLANNED AND AUTONOMOUS MAINTENANCE: BRIDGING THE GAP BETWEEN PRACTICE AND RESEARCH

Competitive pressures and changing production management paradigms have, in recent years, increased the importance of reliable and consistent production equipment. Initially, the Japanese, and now others, have espoused the virtues of a management philosophy known as total productive maintenance (TPM). We are interested in the maintenance-investment decisions for TPM. This paper (1) describes the basic elements of TPM programs, (2) categorizes the relevant research literature using a practitioner's framework for autonomous and planned maintenance activities, and (3) identifies the current gaps between practitioner needs and academic research in the area of TPM and offers suggestions to close the gaps.     

TRANSFER-PRICING AND OUTPUT DECISIONS: THE DYNAMIC INTERACTION

This paper is concerned with the dynamic interactions between output and transferprice decisions in a three-country model for a multinational firm when profits taxation and ad valorem tariffs are applied simultaneously. A numerical example is used to illustrate that the three-country model modifies considerably conclusions reached in the traditional two-country, two-goods framework.     

LIQUIDITY AND CONTAGION: THE CRISIS OF 1763

The financial crisis that swept across northern Europe in 1763 bears a strong resemblance to more recent episodes of financial distress. The combination of the specific contractual arrangements at the time, interlocking credit relationships, and the high leverage of market participants triggered distress sales of assets, leading to a severe liquidity crisis. Hence, the crisis is an early instance of contagion on the asset side of the balance sheet. We highlight the salient features of the 1763 crisis and propose a stylized model of the events. While the financial institutions have changed fundamentally in the intervening 200 or so years, the underlying problems appear to be universal. (JEL: 6621, E44, N23)     

POWER INSIDE THE FIRM AND THE MARKET: A GENERAL EQUILIBRIUM APPROACH

Recent years have witnessed an enormous amount of reorganization of the corporate sector in the United States and Europe. This article examines the role of market competition in this trend of corporate reorganization. We find that, at intermediate levels of competition, the CEO of the corporation decides to have less power inside the firm and to delegate control to lower levels of the firms' hierarchy. Workers' empowerment and the move to a flatter organizational structure emerge as an equilibrium when competition is not too tough and not too weak. The model predicts merger waves or waves of outsourcing when countries become more integrated in the global economy as the corporate sector reorganizes in response to an increase in international competition. (JEL: F12, D23, L22, L1)     

RATIONING DISCRETIONARY ECONOMIC RESOURCES: A MULTIOBJECTIVE APPROACH

Prior research involving capital rationing has focused on capital budgeting issues: given a limited resource pool, which major long-lived fixed assets should be acquired? However, capital rationing can be extended to include not only new fixed-asset purchases but also expenditures for any other discretionary activity such as advertising, research and development, or maintenance. In this broader situation, measuring the contributions of certain discretionary activities to a single objective (e.g., maximize profits) or to multiple objectives often is hindered by a lack of reliable revenue estimates. This problem severely hampers the usefulness of traditional mathematical programming approaches to capital rationing. In this paper, we modify the usual multiobjective capital rationing procedures by treating each discretionary activity as an objective in itself. In this manner, we can mitigate the difficulties associated with revenue measurement problems and allow a decision maker systematically to explore the various trade-offs between competing discretionary investments.     

A GOAL PROGRAMMING MODEL FOR ALLOCATING HUMAN RESOURCES FOR THE GOOD LABORATORY PRACTICE REGULATIONS

The Food and Drug Administration's final Good Laboratory Practice regulation will have a far-reaching effect on testing laboratories that are conducting nonclinical laboratory safety tests. This paper develops a goal programming decision model suitable for setting objectives, meeting budgetary and operational constraints, planning personnel utilization, and evaluating different proposals for allocating laboratory personnel to implement a program.     

OIL AND THE MACROECONOMY: A QUANTITATIVE STRUCTURAL ANALYSIS

We model an open economy where macroeconomic variables fluctuate in response to oil supply shocks, as well as aggregate demand and supply shocks generated domestically and abroad. We use several robust predictions of the model to identify five fundamental shocks underlying the fluctuations of the (real) oil price, the US activity and the global business cycle. The estimates show that supply shocks generated in the global economy explain the largest fraction of the oil price fluctuations, about four times more than canonical oil supply shocks. The correlation between oil prices and the US activity varies with the type of shock.     

OPTIMAL AGING AND DEATH: UNDERSTANDING THE PRESTON CURVE

Does prosperity lead to greater longevity? If so, what is the strength of the income channel? To address these questions we develop a life cycle model in which households are subject to physiological aging. In modeling aging we draw on recent research in the fields of biology and medicine. The speed of the aging process, and thus the age of death, are endogenously determined by optimal health investments. A calibrated version of the model accounts well for the observed nonlinear cross‐country link between longevity and income, also known as the Preston curve.     

THE SYNTHESIS OF HIERARCHICAL STRUCTURES: TECHNIQUE AND APPLICATIONS

Hierarchical structures are an important property of all complex systems and play an important role in the decision and policy sciences. The methodology described in this paper provides a systematic and efficient approach to the synthesis of hierarchies, regardless of their size or intricacy. Two applications are briefly discussed, and other applications are suggested.     

THE LEARNING CURVE: HISTORICAL REVIEW AND COMPREHENSIVE SURVEY

The use of the learning curve has been receiving increasing attention in recent years. Much of this increase has been due to learning curve applications other than in the traditional learning curve areas. A comprehensive survey of developments in the learning curve area has never been published. The closest thing to a survey was by Asher in 1956. His study focused exclusively on military applications during and immediately after World War II. This paper summarizes the learning curve literature from World War II to the present, emphasizing developments since the study by Asher. Particular emphasis is given to identifying the new directions into which the learning curve has made recent inroads and identifying fruitful areas for future research.