Theory presupposes that firms limit their financial needs when undertaking profitable ventures in nonfinancial activities. According to Jan Toporowski, firms may hold excess capital (in financial assets) relative to the capital needed to undertake production in order to manage liquidity. Thus, the internal liquidity of large companies, not monetary policy, is the key factor in nonfinancial business investment. In a financially advanced economy, interest is a purely monetary phenomenon.

The ideas in this paper are connected to the industrial economics of Michal Kalecki and Hyman P. Minsky, as well as the monetary economics of Kalecki. The author’s analysis extends the view of excess capital held by John Maynard Keynes.

Gender affects household spending as a result of female bargaining power and in terms of spending on children. Research Scholar Thomas Masterson assesses the impact of objective and subjective gender patterns on intrahousehold decision-making processes related to education expenditures in Paraguay. He observes what appears to be a pro-male bias, but his findings are inconsistent between rural and urban areas, and between age groups. Also, gender patterns seem to be more pronounced at the household level than at the individual level—a result that is contrary to a similar study conducted in India by Geeta Gandhi Kingdon in 2005.

More information about asset ownership and decision making is needed before there can be effective policy interventions, says Masterson. It is difficult to see the relationship between women’s economic empowerment within the household and their bargaining power, at least in terms of spending on education.

The inverse relationship between farm size and yield per acre has crucial and far-reaching implications for rural development policy; for example, it may provide economic justification for redistributive land reforms. Despite more than 40 years of research, however, there is no consensus on what causes the inverse relationship.

This paper by Research Associate Fatma Gül Ünal affirms that there is a very strong inverse size-yield relationship in Turkey. The relationship is driven by labor input per decare (1,000 square meters, or .25 acre), where land fragmentation appears to have a positive impact on productivity. The author’s findings negate recent “market-friendly” agricultural reforms, while favoring land redistribution supported by technical and financial assistance for farmers. Given current macroeconomic policy, she foresees rising inequality and poverty in the country.

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