We analyze an infinite horizon difference game between four aggregated industries-production of producer goods, production of consumption goods, federation of labor unions, and commercial banking sector. Consumers do ...We analyze an infinite horizon difference game between four aggregated industries-production of producer goods, production of consumption goods, federation of labor unions, and commercial banking sector. Consumers do not behave strategically. They make their decisions on the basis of maximization of average discounted utility. Therefore, we do not include them in the set of players in the game. The payoffof each production industry and the commercial banking sector is equal to the average discounted sum of real dividends of its owners. The payoff of the federation of labor unions is equal to the average discounted sum of real wages and real unemployment benefits. A strict strong perfect general equilibrium is the applied solution concept for the game. It requires that there does not exist a coalition of players that can weakly Pareto improve the vector of continuation payoffs of its members in some subgame by a coordinated deviation. It is a refinement of Rubinstein＇s concept of a strong perfect equilibrium. We formulate and prove the sufficient condition for its existence. It is based on the assumption that no one of the aggregated industries can have a positive output without using some minimal amount of output of each other aggregated industry as an input. By definition, in each subgame, the equilibrium payoff vector in a strict strong perfect general equilibrium is strictly Pareto efficient. Thus, if each consumer either has only income from wage and unemployment benefit or receives dividend from only one aggregated industry, and his nominal income in each period along the equilibrium path exceeds social minimum, it is not possible to weakly Pareto improve the vector of consumers＇ average discounted real incomes. This holds not only for the whole game but also for each subgame starting in the first phase of some period.展开更多
This paper examines the appropriateness of the adoption of Anglo-American type of reorganization provisions into national bankruptcy law using Thailand as a sample. It argues that such adoption shall be cautious. Sinc...This paper examines the appropriateness of the adoption of Anglo-American type of reorganization provisions into national bankruptcy law using Thailand as a sample. It argues that such adoption shall be cautious. Since Thailand started to accommodate such provisions, reorganization, apparently, has limited usefulness--benefitting only large-scale debtors because it does not fit with the nature of Thai business culture, i.e., the borrowing-lending relationship and less-than-arm＇s length business connections. On average, only every one in 200 bankruptcy cases employs reorganization; the rest goes for liquidation but the average outstanding debt in reorganization is over 30 times higher than liquidation. Interestingly, the adjudication rate of reorganization is faster than those of liquidation. Debtors＇ strategic use of the law and the procedural bias are suspected. Debt restructuring led by the central bank in cooperation with commercial banks, instead, is overwhelmingly more successful, equally efficient, and effective because any ailing firm can renegotiate its borrowing contract rather easily in the low transaction cost environment. Debt restructuring outperformed reorganization roughly 800 and two times in terms of cases and debt amount respectively. Thus, the adoption of non-indigenous provisions shall be made prudently. This argument applies towards the standardization of insolvency legislation. Standardizing bankruptcy procedures shall be made carefully and national economic conditions including local business nature and uniqueness are worth examined before any enactment or amendment. Otherwise, benefits of international trade and investment would be achieved at the expense of economic efficiency.展开更多
文摘We analyze an infinite horizon difference game between four aggregated industries-production of producer goods, production of consumption goods, federation of labor unions, and commercial banking sector. Consumers do not behave strategically. They make their decisions on the basis of maximization of average discounted utility. Therefore, we do not include them in the set of players in the game. The payoffof each production industry and the commercial banking sector is equal to the average discounted sum of real dividends of its owners. The payoff of the federation of labor unions is equal to the average discounted sum of real wages and real unemployment benefits. A strict strong perfect general equilibrium is the applied solution concept for the game. It requires that there does not exist a coalition of players that can weakly Pareto improve the vector of continuation payoffs of its members in some subgame by a coordinated deviation. It is a refinement of Rubinstein＇s concept of a strong perfect equilibrium. We formulate and prove the sufficient condition for its existence. It is based on the assumption that no one of the aggregated industries can have a positive output without using some minimal amount of output of each other aggregated industry as an input. By definition, in each subgame, the equilibrium payoff vector in a strict strong perfect general equilibrium is strictly Pareto efficient. Thus, if each consumer either has only income from wage and unemployment benefit or receives dividend from only one aggregated industry, and his nominal income in each period along the equilibrium path exceeds social minimum, it is not possible to weakly Pareto improve the vector of consumers＇ average discounted real incomes. This holds not only for the whole game but also for each subgame starting in the first phase of some period.
文摘This paper examines the appropriateness of the adoption of Anglo-American type of reorganization provisions into national bankruptcy law using Thailand as a sample. It argues that such adoption shall be cautious. Since Thailand started to accommodate such provisions, reorganization, apparently, has limited usefulness--benefitting only large-scale debtors because it does not fit with the nature of Thai business culture, i.e., the borrowing-lending relationship and less-than-arm＇s length business connections. On average, only every one in 200 bankruptcy cases employs reorganization; the rest goes for liquidation but the average outstanding debt in reorganization is over 30 times higher than liquidation. Interestingly, the adjudication rate of reorganization is faster than those of liquidation. Debtors＇ strategic use of the law and the procedural bias are suspected. Debt restructuring led by the central bank in cooperation with commercial banks, instead, is overwhelmingly more successful, equally efficient, and effective because any ailing firm can renegotiate its borrowing contract rather easily in the low transaction cost environment. Debt restructuring outperformed reorganization roughly 800 and two times in terms of cases and debt amount respectively. Thus, the adoption of non-indigenous provisions shall be made prudently. This argument applies towards the standardization of insolvency legislation. Standardizing bankruptcy procedures shall be made carefully and national economic conditions including local business nature and uniqueness are worth examined before any enactment or amendment. Otherwise, benefits of international trade and investment would be achieved at the expense of economic efficiency.
