Knowledge that Transforms

This book is a report on a research project in which computer simulation techniques were used to test the rationality of alternative methods of priee calculation in industrial firms.Most of the work was done at the Norwegian School of Economies, with the aid of the Computation Centre of the University of Bergen.Drawing as it must from the various fields of economies, accounting, mathematics, statisties, and computer science, the book is partlya product of a rich interdisciplinary academic milieu, in which I am grateful for having had the opportunity to work.Its defects, however, may be attributed to me.The project was financed by grants from AfS Norsk Varekrigsforsikrings Fond and

In Italian: Lo Spazio nei Piani Economici, Franco Angeli Editore, Milan, 1972, 391 p. In Spanish: El Factor Espacio en la Planificación del Desarollo, Series ‘Fondo de Cultura Económica’, Fondo de Cultura Económica, Mexico, 1980, 405 p.

"Inl statistical inference proper, the model is never questioned.... The methods of mathe-matical statistics do not provide us with a means of specifying the model. " 1

T HIS study investigates within a comrnon analytical framework the determinants of firm expenditures o;n capital investment, research and development and dividends. Its two basic objectives relative to past work are: first, to probe more deeply into the forces determining these outlays by taking into account the interdependencies among them,' and second, to provide a framework for evaluating alternative assumptions regarding firm motivation. A firm maximizing stockholder objectives will exhibit different behavior in its expenditure decisions from one pursuing managerial goals. Consequently, two main variants of a model of firm expenditures, based on these rival concepts of motivation, are developed and tested.

RES (Review of Economic Studies) , January, 1971, concerning whether or not Gorman's Lemma 1 (RES, 1968) can be strengthened by re-laxing Gorman's assumption of arc-connectivity for the space of prospects to connectivity alone. A lemma is proved showing the mentioned relaxation feasible and furnishing proof for Gorman's Lemma 1. This supplies a missing foundation stone of Gorman's "Structure of Utility Functions " and generalizes the results therein.

John Hause's paper is addressed to the perplexing matters of how to disentangle the effects of and schooling on worker earnings, and of the effect of on earnings over a worker's lifetime.' His emphasis oil ability and schooling as determinants of earnings is surely not intended to deny that other variables also affect earnings or to deny that these other variables may also interact with and schooling level-but he barely touches on other variables or the possibility of interactions.

This is the publisher's version, also available electronically from http://www.jstor.org/stable/1830228?seq=1#page_scan_tab_contents

The article focuses on the Heckscher-Ohlin theorem in the multi-commodity case. Economist Ronald Jones, in his seminal paper on Heckscher-Ohlin theory, has argued that for the case of two countries, two factors and several commodities, the Heckscher-Ohlin theorem would certain valid in the following weak sense: "Ordering the commodities with respect to the capital-labor ratios employed in production is to rank them in order of comparative advantage. Demand conditions merely determine the dividing line between exports and imports, it is not possible to break the chain of comparative advantage by exporting, say the third and fifth commodities and importing the fourth when they are ranked by factor intensity" Furthermore, as Jones had pointed out if transport costs is introduced, the theorem can be revalidated. With transport costs on every commodity, commodity prices would no longer be equal across countries in trade, and therefore factor prices also could not be equalized via commodity price equalization. Thus, while a commodity in the middle of a chain of exportables may be priced out of the export market into being a non-traded good by high transportation costs, it is impossible for it to be turned into an imported good.