The central point of this presidential address is that the settlement and redistribution of rights, including property rights, refer to sanctioned behavioral relations among men that arise from the existence of goods and services and relate to their use. Some economic concepts such as uncertainty, information, externalities, transaction cost, internal organization, consumer liability, producer liability, etc., can be clearly understood by emphasis on ideas concerning the interconnect- edness of property rights, incentives, and economic behavior, in relation to the marketplace and other social settings.
There has been a rapid expansion of the realm of public activities in order to regulate the external effects of consumer injury and environmental pollution beyond the reach of the market mechanisms so as to protect citizens' livelihoods. The rising social costs in various fields are not fully reflected into demand and supply, thus delaying the required institutional responses including the legal aspect. Today's legal system, evolved from modern civil law, has become increasingly incompatible with realities of contemporary society in terms of utilization of the environment, consumer transactions, and individuals' dealings with organizations.
The applicability of the current standard economic theory is now somewhat limited and modifications must be made to the conventional analytical framework if its approach is still to be able to provide fundamental insights into economic problems of production, exchange and consumption. To develop and construct a model of interactions between law and institutions and economy is essential for overcoming the one-sided nature of economic analysis.
The establishment of a specific right and the enforcement and exercise thereof after its implementation would bring forth new gains or injuries to other persons, might introduce new private and social costs, or give new incentives to people to change their behaviors. The same result would follow from the implementation of a new restriction on private rights. In other words, visible costs and benefits are not the only determinants of behaviors but the right thereto is also an important determinant. The distribution of private rights or restriction thereof leads to a different structure of benefits and losses through creation of a new system of rights. Thus, there appears a system of relations between rights and economic choices.1)
The assignment of different rights leads to different incentive systems and hence decides the choices that are open to individual decision makers in the socio-economic community. Recent topics concerning characteristics of non-Walrasian equilibrium, product failure and liability rules, insurance and risk-sharing, moral hazard and adverse selection, market signalling and self-selection, market and nonmarket controls, etc., are reviewed from the standpoint that emphasises the interrelations between institutional arrangements and economic behavior.
The focus of discussion is on the institutional environment in which economic activity motivated by self-interest takes place, and on the conditions for voiding conflicts among the economic solutions based on allocative and distributive criteria and judicial solutions based on legal equity objectives. It may be necessary to extend socio-economic systems to redesign the general rules of indemnity and risk-bearing so that they can bring about economic incentives for engaging in efficient and equitable behaviors.

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Although the four-quarter change in the aggregate wage has been used as the dependent variable in most empirical wage equations, Ashenfelter and Pencavel have reported the results of including explicitly in the estimation procedure the available information on the proportion of workers receiving wage adjustments in a given quater.
The purpose of this paper is to demonstrate that the application of this model to Japanese data gives efficient estimates to her postwar Phillips curve. The additional assumption adopted here is the presence of annual wage revision, considering age and the length of the workers. We also propose a new method to adjust the effects of the variation of working hours on wage changes.

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This paper investigates whether the lending rate in the Japanese business loan market is flexible enough to equilibrate demand and supply. We employ methods of estimation for a disequilibrium market and tests of the equilibrium hypothesis which are developed in our earlier paper. First, using our consistent estimator, we find that the nominal lending rate adjusts only about 10 percent from the preceding period's rate toward the current equilibrium rate. The equilibrium hypothesis is rejected. There is a view that, instead of the nominal rate, the effective lending rate, which takes into account compensating deposits, is a more appropriate price variable for this market. Therefore, secondly, we estimated the same market using the effective lending rate. Since data of compensating deposits are not available, we take a proxy for compensating deposits and create a proxy for the effective lending rate. A proxy for the effective lending rate is estimated to adjust 15 percent toward the equilibrium rate from the preceding period's rate. A t-statistic implies that the equilibrium hypothesis is still rejected. Thirdly, we assume that the nominal rate is adjusted not only to the excess demand pressure but also the direct effect from a change in the discount rate. This specification implies that the lending rate is related to the discount rate by some institutional rigidity or by announcement effects. The estimated adjustment of the nominal rate with respect to the demand pressure is still about 10 percent and the equilibrium hypothesis is again rejected.

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The purpose of this paper is to make clear whether the bank loan market in Japan is in equilibrium or not. There have been three papers on the issue, Hamada et al. [7], Furukawa [6] and Kamae [15]. They are contradicted with each other so that the definite conclusion has not yet been reached. Hamada et al. [8] explains that the difference in conclusion comes from the difference in observation period. The present paper re-examines their estimation to show that the explanation is not correct. The re-examination indicates that their supposed supply functions have multicollinearity, causing the contradiction.
In addition, those papers are found to have following weak points:
(a) They say that excess supply periods were longer than excess demand periods in 1960's and early 70's. However, the opposite view is commonly accepted.
(b) Whether the market is in equilibrium or not is judged in those three papers by the sign condition of estimated parameters. But this method fails to give a definite answer in many cases.
The present paper suggests more appropriate way of analysis as follows:
(A) Using three indices, an adequate sample separation can be found consistent with the popular view.
(B) Chow Test [2] is applied to judge whether the market is in equilibrium or not. This method enables us to judge in any case and to assess the degree of disequilibrium quantitatively.
With these modifications, the present paper concludes that the Japanese bank loan market is in disequilibrium whichever adjustment it has, the effective interest rate or the nominal interest rate.
Futhermore, the excess demand for the bank loan and the equilibrium interest rate are estimated quantitatively, describing the market condition fairly well.

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In this paper we investigate the relationships between the real wage rate, the rate of profit and the rate of exploitation rigorously using the framework presented by Okishio and Nakatani [8] which allows for the existence of the particular type of the durable equipments, i.e., the‘constant efficiency’fixed capitals. It is shown that many results which were obtained in the framework of the circulating capital model, among others, Marxian theory of value, price and exploitation, can be extended to this particular fixed capital economy without resorting to the 'inequality approach' proposed by Morishima and Catephores [5].
In section 2 we formulate the model based on Okishio and Nakatani [8], and then clarify systematically some characteristics of this particular fixed capital economy. Section 3 and section 4 are devoted to the analyses of the problems of the‘wage-profit curve’and the‘transformation problem’which asks the relationship between the profitability and the exploitation of the surplus labour under the general framework of the model formulated in section 2. In section 5 we consider the transformation problem under the special assumption of the‘equal organic compositions of capital’, and finally in section 6 we show that the application of Sraffa [13]'s theory of the‘standard commodity’is useful in solving the problem which has been posed in section 5.

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