Mauro Rota

The long-run determinants of British capital exports, 1870–1913

Unlike recent contributions in the field, which discuss the geography of British overseas investments, this article focuses on the growth of capital exports from Great Britain during the period 1870–1913. Using a broader concept of foreign investments, which includes foreign direct investments (FDIs), and refocusing on the push and pull factors emphasised in earlier literature, we propose a framework able to capture the long-run determinants of British capital exports. Moreover, the framework includes elements suggested by early and recent works such as the institutional setup of the international economy and the evolution of world trade. The most relevant result, in an error correction model environment, is that the timing of British overseas investments in the long run seems to be related to the evolution of world trade, domestic growth and to the role of India as a colony. On the other hand, the attraction elements of the borrowing countries, captured by the risk-adjusted realised rates of return abroad, have been proven to matter in the short run.

Effects of Law-Enforcement Efficiency and Duration of Trials in an Oligopolistic Competition Among Fair and Unfair Firms

Building on differential game theory involving asymmetric agents, an oligopoly game between two distinct groups of firms is analyzed and solved under open-loop information. One group develops Research & Development to reduce its marginal production costs and behaves fairly, whereas the other one violates intellectual property rights of the rival, using the stolen technology to reduce its own marginal costs. We investigate the effects of law enforcement in this setup, by discussing the appropriate fine to be determined and the profitability of unfair behavior. Finally, we assess how the duration of related trials can affect efficiency of enforcement policy.