This paper argues that existing models of urban concentrations are incomplete unless grounded in the most fundamental aspect of proximity; face-to-face contact. Face-to-face contact has four main features; it is an efficient communication technology; it can help solve incentive problems; it can...

The emergence of the so-called ¿network economy¿ and the development of project-basedwork pose a fundamental challenge to established methods of regulating the employmentrelationship. There appears to be an unsatisfied demand for its greater use, especially amongemployers, and it is argued...

This paper takes a new look at the issue of overseas sourcing of services. In framework in which comparative advantage is endogenous to agglomeration economies and factor mobility, the fragmentation of production made possible by the new communication technologies and low transportation costs...

Firms faced with the decision of whether to standardize or not prior to introducing a new network technology face a tradeoff: Compatibility improves the technology's chances of consumer acceptance, but it also means having to share the resulting profits with other sponsors of the standard. In...

Empirical evidence suggests that trade liberalization increases firm productivity. This paper offers a novel explanation for this finding. I develop a simple general equilibrium model of trade in which trade liberalization leads to outsourcing as firms focus on their core competencies in...

To analyse the consequences of the changing economic structure of the UK, we need aset of statistics broken down by industry that are consistent with the whole economymeasures available from the national accounts. The theory of growth accounting thenprovides a framework in which the contribution...

Inactivity rates among prime-age men in the UK have risen by at least five times since the early 1970s whereas unemployment rates are much the same. Furthermore, inactivity is strongly concentrated among the unskilled and those suffering from a limiting long-term illness or disability. In our...

Labor market institutions, via their effect on the wage structure, affect the investmentdecisions of firms in labor markets with frictions. This observation helps explain rising wageinequality in the US, but a relatively stable wage structure in Europe in the 1980s. Thesedifferent trends are the...

In this paper we seek to explain the emergence of different voice regimes, and to do so by using approaches from institutional economics. In particular we analyse the emergence of different voice regimes as a contracting problem; a ¿make¿ or ¿buy¿ decision on the part of the employer. A...

This paper presents a model of social learning about the suitability of local conditions for new business ventures and explores its implications for the microeconomic patterns of economic development. I show that: i) firms tend to 'rush' into business ventures with which other firms have had...