generating conditional expectations from models with selectivity bias abstract this paper discusses how conditional expectations should be generated from models with sample selectivity we argue that the conventional method ignores relevant and available information and produces unreliable results an alternative approach is suggested and the empirical example of black white wage differentials is presented

designing forest taxes with varying government preferences and budget targets abstract a model of forest policy design is constructed to examine how government preferences affect the choice of forest taxes government preferences are modelled by assuming that the government faces a binding revenue constraint and cares about the provision of public goods from forests the equilibrium is second best given the imposition of the revenue constraint on the government s decision making our results show that a revenue constrained government will make different choices than a government that does not face revenue constraints this has important implications for the choice of property and harvest taxes as well as pigouvian forest taxes

unemployment in south africa the nature of the beast abstract unemployment in south africa is so widespread that it demands an explanation this paper examines a central question about south african unemployment why do the unemployed not enter the informal sector as is common in other developing countries the data do not support the idea that unemployment is largely voluntary the policy implications that government should diminish labor market segmentation and the obstacles to entering the productive informal sector may be relevant also to other developing countries with high unemployment

measures of agricultural support policies in transition economies 1994 1997 in the pre reform period agriculture was heavily subsidized in most central and eastern european countries ceec s around 1989 most ceec s began to open up their markets liberalize prices and reduce subsidies and the level of support provided to agriculture declined drastically while not questioning the direction of economic reforms there was concern that the decline in profitability in farning would slow down the impetus for farm restructuring in particular the drive for privatization of land as demanded by potential new farmers however after pursuing rather liberal agricultural policies at the beginning of the transition period some ceec s in recent years have reintroduced higher levels of support stefan tangerman 1996 in this paper based on estimates of various support indicators for the period beginning roughly in 1994 i will address some of the more important questions regarding agricultural support what has been the impact of trade and price policy interventions on the net income of farmers and government budgets how level has the playing field been since the reintroduction of support does the current economic environment provide an appropriate and sound basis for adjustment toward a more competitive agricultural sector this analysis is part of a comparative study by the world bank which covers bulgaria poland romania ukraine and russia in progress plus germany and turkey two reference cases geographically located at the border of the ceec s for each country employing the same methodology the study considers approximately eight commodities which are representative of the country s major import competing and export products

on the transmission of world agricultural prices two questions are asked about the relationship between domestic prices and world prices of agricultural commodities are variations in world prices transmitted to domestic prices domestic prices are regressed on world prices in various forms taking into account the possible effects of exchange rates and inflation the empirical analysis is based on data from the food and agriculture organization of the united nations for 58 countries from 1968 78 and for the countries of the european community from 1961 85 the results show that most of the variations in world prices are transmitted and that they constitute the dominant component in the variations of domestic prices

producer subsidy equivalents for russian agriculture estimation and interpretation in this paper we present estimates of producer subsidy equivalents pses for russian agriculture over the 1992 94 period the estimated values are highly negative indicating that russian agriculture has been heavily taxed two types of taxation have been at work first government trade and price policies at the regional as well as the federal level have operated to keep domestic producer prices below world prices second deficient russian physical and institutional infrastructure has resulted in high domestic transaction costs for russian agricultural output since in competing with goods on the world market russian producers must bear all the costs of getting their output to final users the high transaction costs in an economic sense also tax domestic production the pse methodology was created to measure the effect on agricultural prices and incomes of government policies targeted specifically at agriculture to be consistent with standard methodology one should subtract out from the initial price gap estimates for russian agricultural output that part of the price differential caused by deficient domestic infrastructure an alternative approach though is based on recognition that the deficient infrastructure was in

sustainable forestry timber bequests future generations and optimal tax policy this paper analyzes harvesting and timber bequest behavior in a two period overlapping generations model where the government uses site productivity yield and inheritance taxation the ceteris paribus effects of forest and inheritance taxes are derived first then the paper discusses the optimal design of forest and inheritance taxes by assuming that intergenerational externalities are either absent or operative in the absence of intergenerational externalities it is optimal to use only the site productivity tax and not to introduce yield and inheritance taxes at all in the presence of intergenerational externalities the situation changes the paper demonstrates that the externality can be internalized by introducing either a yield tax or an inheritance subsidy or both if the government is able to use both at the same time it is desirable to use the yield tax to punish excessive harvesting and an inheritance subsidy to bribe to give bequests

calculating levels of protection is it always appropriate to use world reference prices based on current trading status abstract protection measures such as the nominal protection coefficient npc the effective protection coefficient epc the producer subsidy equivalent pse and the consumer subsidy equivalent cse are conventionally calculated using world reference prices based on current trading status under certain conditions the conventional approach can lead to incorrect estimation of the degree and sometimes even the direction of protection this paper spells out the conditions under which use of world reference prices based on current trading status is incorrect and presents data for wheat in pakistan to illustrate how failure to consider these conditions can lead to misleading policy recommendations

the transfer efficiency and trade effects of direct payments all the different ways governments use to provide financialsupport to farmers can potentially distort trade and reduce net economic welfare however there are some types of support that are less trade distorting and more efficient than others this article reports the results of an analysis that examined different policy measures providing support to crop producers to rank them in terms of their effects on a selection of indicators with a particular focus on trade distortion and income transfer efficiency 1 we begin with an analysis of the differences in policy impacts among the three main categories of support provided to crop producers in oecd countries market price support payments based on land use and payments based on use of purchased inputs oecd 2001c that analysis is based on a two region model of equilibrium in the world market for a representative crop analytical solutions to this modelare devel oped to compare the production trade and income effects of the different support measures following procedures used in cahill and in moro and sckokai comparisons are of impact ratios using market price support as the reference category these ratios measure the effect on production trade or farm income of a given joe dewbre jesus anton and wyatt thompson are economists in the agricultural directorate of the organization for economic cooperation and development where the underlying analysis was undertaken the views expressed are our own and not necessarily those of the oecd secretariat or its member countries we thank our secretariat colleagues ken ash carmel cahill wilfrid legg and michele patterson for helpful comments on an earlier draft and stephane guillot for computer programming assistance this article was presented in a principal paper session at the aaea annualmeeting chicago il august 2001 the articl es in these sessions are not subjected to the journal s standard refereeing process 1

male labour force participation following illness or injury this paper develops a model of the disabled individual s labour force participation decision following illness or injury and confronts it with data on the financial consequences of ill health a utility function is specified which allows for the effect of changes in health on work leisure preferences and is evaluated in relation to a household budget constraint estimation is through maximization of the appropriate likelihood function correcting for self selection bias within a switching regression model results are presented showing significant effects of financial variables on participation and these are seen to vary with age disability and income

the value of youth equalizing age differentials in marriages the objective of this paper is to present a model of constrained utility maximizing behaviour which is able to explain serveral features of marriage the model predicts that individuals meet in the

policy relevant nonconvexities in the production of multiple forest benefits abstract this paper challenges common assumptions about convexity in forest rotation models which optimize timber plus nontimber benefits if a local optimum occurs earlier than the globally optimal age policy based on marginal incentives may achieve suboptimal results policy relevant nonconvexities are more likely if i nontimber benefits dominate for young stands while the optimal age depends primarily on timber benefits or ii nontimber benefits dominate for mature stands and also determine the optimal age nonconvexities may create either temporary or persistent difficulties policymakers may improve efficiency by exploiting the relationship between the timber only optimum and the global optimum

taxation bequests and short and long run timber supplies an overlapping generations problem this paper uses an overlapping generations model with one sided altruism to study the effects of several forest taxes that target bequests and affect timber supply unlike previous work we investigate bequests and timber supply in both the short and long run when bequests are costly e g taxed the landowner s problem is examined in the short run while the government s problem is examined in the long run assuming the existence of a steady state we also consider taxes targeting harvests growth savings and bequests several new results are established concerning the interactions of taxes that might be used by a government to alter short and long run forest capital stocks i the presence of a forest bequest tax affects the neutrality of harvest tax in both the short and long run ii in the long run the bequest tax decreases bequests and timber supplies when the bequest tax is not present the capital income tax is neutral with respect to bequest and timber supply while the harvest tax is neutral only if forest productivity is also not taxed finally iii in the short run the substitution and total effects of taxes in landowner decisions generally depend on the presence of the bequest tax the results have implications for pigouvian tax design and second best tax choice

government management of village commons comparing two forest policies abstract when monitoring or enforcement is difficult governments may find it impossible to manage village forest commons directly village level institutions might be better able to manage these commons yet villagers management objectives may not coincide with those of the state this article considers the effects of two different government policies on the local management of village commons one policy tool attempts to induce villagers to conserve forest commons by giving them a share of the timber harvest we investigate the question of whether or not this scheme joint forest management jfm is preferred either by the villagers or the government to a simple benchmark policy under which the government harvests at random we show that when villagers are sufficiently patient for any equilibrium jfm policy there exists a benchmark policy which gives villagers the same level of utility however whether the government is similarly indifferent between these two arrangements depends on the villagers ability to enforce collective agreements and on the curvature of villagers utility functions

the ams in agricultural trade negotiations a review abstract this article reviews the role of the aggregate measure of support ams in the agricultural trade negotiations of the uruguay round contrary to expectations at the start of these negotiations the ams only occupies a subsidiary position in the final agreement in order to explain this first an economic analysis is presented of the producer subsidy equivalent pse the basic ams concept in the gatt discussions secondly the political ams debate is described and analysed using information from unpublished gatt documents although the pse concept is based on simple assumptions its measurement already meets a number of difficult problems policy coverage product coverage external reference prices currency once these are solved the concept may offer a brief insight into actual governmental support in agriculture however the calculations do not provide a sound measure of the trade distortions caused by agricultural policies mainly for that reason the idea of a pure aggregated approach based on the ams proved unsuccessful in the negotiations instead the contracting parties accepted the framework of making binding agreements on three separate areas internal support market access and export support while important and very specific commitments were made in the areas of agricultural imports and exports the ams has only found application in the internal support area

the theory of taxation for developing countries tax policy has far reaching implications for economic development and public administration this book which presents a modern theory of public finance brings together many of the most distinguished economists who have written on the subject they provide coherent principles for tax design and a systematic framework for the analysis of practical questions of tax reform and pricing policy in developing countries the book is especially timely as countries experience increasing shortages of government revenue and the distortions brought about by poorly designed tax systems it pays particular attention to the special problems of developing countries such as the taxation of agriculture the aim throughout is to develop techniques that can be quantitatively applied given the data available and empirical case studies illustrate the methods in action the authors analyze the links between tax theory social cost benefit analysis and the pricing of publicly supplied goods and services they also explore the empirical and econometric problems of identifying the tradeoffs between equity and efficiency other topics treated include the analysis of labor markets the taxation of foreign private investment and of fuel and the pricing of education although the models used concentrate on developing countries most of the methods and discussion apply as well to the problems of more affluent countries

virtual price approach to short term timber supply under credit rationing abstract duality and virtual prices are used in a fisherian two period savings consumption model to simplify the analysis of nonindustrial private timber supply under credit rationing a possible way to measure the degree of credit rationing perceived by nonindustrial private forest owners is proposed slutsky type decompositions for the derivatives of the credit rationed timber supply function are calculated and the credit rationed derivatives are related to corresponding derivatives in a perfect capital market further the impact of the degree of credit rationing on the substitution and income effects of the exogenous variables are discussed and it is shown that the total effects are independent of the degree of credit rationing the results help to interpret parameter estimates of private nonindustrial timber supply functions especially if micro data are available

bequest intentions of forest landowners theory and empirical evidence this article studies in an overlapping generations forest economy the conditions under which money and or timber bequests occur across generations assuming the usual case of one sided altruism we assume nonindustrial landowners have preferences for consumption and for amenities from unharvested forest stock within this framework we examine conditions under which landowners choose to leave timber or money bequests and we show how taxation is important to these conditions empirical evidence from bequests decisions for a cross section sample of nonindustrial landowners in virginia is then used to investigate the hypotheses suggested by the model with regard to the motive to leave bequests the results are broadly consistent with the theoretical findings

forestry and the bequest motive abstract with an overlapping generations model for trees and humans it is shown that in a small open timber producing economy both in a setting where the economy is planned in order to maximize an intertemporal social welfare function and in a decentralized market economy long term forest investments should be evaluated by their net present value this is so provided that the existing generation has some if even very small concern for the well being of the next generation a review of empirical studies among nonindustrial private forest owners in the u s and in sweden gives support to the suggestion that this mechanism based on a tinge of altruism may be more important in promoting long term silvicultural investments than the incentives given by existing land markets

use of the producer subsidy equivalent as a measure of support to agriculture in transition economies measurements of total support or assistance to agriculture using the producer subsidy equivalent pse have become a standard tool of policy analysts in the last decade from its initial use by josling at the food and agriculture organization fao josling fao the pse grew in popularity in parallel with the gatt uruguay round agricultural trade negotiations failure in previous gatt rounds to bring agriculture adequately within gatt rules and disciplines had been attributed in particular to difficulties in capturing the effects of the multiplicity of domestic measures and nontariff barriers to trade in agricultural products grogan pp 297 306 a common yardstick capturing the effects of all these policy measures was needed the organization for economic cooperation and development oecd developed the methodology and applied it progressively to all oecd countries and recently to economies in transition see oecd 1994 1995c and 1995d

analysing agricultural policy reforms under transition in bulgaria abstract the elaboration of an appropriate incentive system including measures of agricultural price and trade policy has important consequences for bulgarian agriculture this paper offers a brief picture of the process of reform towards the establishment of a market economy in bulgaria as well as of the main developments in its agricultural sector an analysis is then presented of the impact of alternative agricultural price and trade policy scenarios for the period up to 2002 the results show that the impact of price and trade policies is modest when compared to that of technological change and the increase in incomes adoption of the cap will stimulate production decrease demand and have strong adverse effects on consumers and taxpayers and wider negative effects on the competitiveness of the food industry thus the issue of extending financial support for structural policies rather than granting direct aid requires further investigation

a dynamic theory of factor taxation many important questions in macroeconomics concern the impact of taxation and spending policies on private resource allocation one approach typified by robert hall 1971 and william brock and stephen turnovsky 1981 is to use dynamic general equilibrium models to address basic issues in fiscal and tax policy the objective is to explicitly examine macroeconomic issues without embracing the market imperfections fixed prices missing markets money illusion etc found in conventional macroeconomic analysis there is currently great interest in dynamic fiscal policy problems this decade has already seen two major adjustments in tax policy and many attempts to substantially alter spending patterns the result of this tumult has been unprecedented peacetime deficits and much uncertainty about what measures will ultimately be used to bring the budget into balance in this paper i discuss the impact of alternative fiscal policies in a dynamic general equilibrium model i examine the shortrun effects of fiscal policy changes the efficiency cost of alternative dynamic tax policies the effects of uncertain policy formation and the redistributive effects of factor taxation

price knowledge in household demand for utility services a household s decision to acquire price knowledge is endogenous in the demand for utility services and may affect elasticities and consumption levels a simultaneous equation model with endogenous switching is developed to evaluate the effects of price knowledge and other sources of heterogeneity results indicate informed households were more responsive to average and marginal price signals informed households also use less water but this is due to heterogeneity rather than price knowledge controlling for heterogeneity price knowledge actually increases monthly water usage the implications of accounting for differences in price knowledge in utility demand modeling and demand management policy are discussed

how useful is the pse in determining agricultural support the support of the agricultural sector in developed countries plays a major role in the international policy agenda the producer support estimate pse is one of the best known measures which has been developed by oecd and is used all over the globe in the pse all types of support are aggregated and one of the main components 70 at oecd level is the market price support mps here we show by means of characteristic examples that the mps has no clear relation to basic economic measures determining support for producers as a consequence of policy intervention the mps overestimates the consequences of tariffs and export subsidies and underestimates the consequences of quota systems in determining producer support misperception of the size and directions of support may affect policy decision making wrongly the paper indicates that weighted average producer prices corrected for quantity restrictions may be more useful than the reference prices and quantities used by oecd

producer subsidy equivalents and evaluation of support to russian agricultural producers since many of the conditions taken for granted in mature market economies cannot be assumed for transition economies such as russia the validity of producer subsidy equivalents pse measures is questionable the authors calculate pses for russia being careful in the selection of appropriate farm prices and reference prices and conduct a sensitivity analysis to indicate how the results could be influenced by changes in key assumptions they also provide appropriate interpretations of pse estimations for major agricultural commodities

assessing the relationship between government policy and deforestation abstract the effects of public policies on deforestation are assessed in a general equilibrium framework a forest can be left in its natural state to provide a consumption benefit such as biodiversity or carbon absorption in its natural state it is subject to free access however alternatively it can be converted to a market input needed to produce a valuable final product the utility of consumers depends on the amount of the forest left standing on consumption of the forest using commodity and on consumption of a numeraire that is produced from non forest inputs only final commodities are traded with the outside world at constant prices the model is used to evaluate claims in the literature regarding the effects of government policies on deforestation in developing countries the polices examined include transportation improvements taxes and royalties on timber harvests controls on log exports a variety of agricultural policies tax incentives to promote domestic processing industries and employment opportunity enhancement

mobility and the return to education testing a roy model with multiple markets self selected migration presents one potential explanation for why observed returns to a college education in local labor markets vary widely even though u s workers are highly mobile to assess the impact of self selection on estimated returns this paper first develops a roy model of mobility and earnings where workers choose in which of the 50 states plus the district of columbia to live and work available estimation methods are either infeasible for a selection model with so many alternatives or place potentially severe restrictions on earnings and the selection process this paper develops an alternative econometric methodology that combines lee s 1983 parametric maximum order statistic approach to reduce the dimensionality of the error terms with more recent work on semiparametric estimation of selection models e g ahn and powell 1993 the resulting semiparametric correction is easy to implement and can be adapted to a variety of other polychotomous choice problems the empirical work which uses 1990 u s census data confirms the role of comparative advantage in mobility decisions the results suggest that self selection of higher educated individuals to states with higher returns to education generally leads to upward biases in ols estimates of the returns to education in state specific labor markets while the estimated returns to a college education are significantly biased correcting for the bias does not narrow the range of returns across states consistent with the finding that the corrected return to a college education differs across the u s the relative state to state migration flows of college versus high school educated individuals respond strongly to differences in the return to education and amenities across states

optimal taxation timber and externalities abstract the paper presents a model of the relationship between timber taxation and externalities optimal pigouvian taxation formulas are derived within this framework for common taxes a simulation model of douglas fir is used to estimate the size and direction of these effects the results show that taxation policy can have a marked impact on the production of externalities depending on tree species and land productivity

optimal forest rotation with in situ preferences abstract this study develops a utility maximization infinite horizon forest rotation model that includesin situvalues and the forest owner s consumption savings decision making the value of forest land becomes owner specific and depends on property rights related toin situbenefits the length of the rotation period depends e g on the wealth of the forest owner and may evolve in time a forest owner with accumulating nonforest assets never continues harvesting forever in contrast with decreasing nonforest assets the rotation period converges toward the faustmann solution in a multiple stand version of the model the harvesting decisions regarding different stands are linked together via the budget constraint and the dependence of an individual stand sin situvalue on the age structure of the whole forest numerical simulation with two stands suggests that within the class of concavein situvaluation functions the optimal solution yields convergence toward forests with increasing heterogeneity of age structures

exchange rate effects on inputs and outputs in canadian agriculture in a seminal piece of work schuh demonstrates using a single market partial equilibrium model that exchange rates have a large impact on the price received for farm products he argued that the overvalued u s dollar reduced export demand and the domestic price of u s grains since then much of the work on estimating the impact of exchange rate changes on agriculture has implicitly assumed that inputs to the agricultural sector come from the nontraded sector we argue this assumption can result in an error in the estimation of the effects of exchange rates in an examination of the passthrough of changes in the us cdn exchange rate we find the data from 1975 to 1989 are consistent with the hypothesis of a complete passthrough of exchange rates for many important variable inputs to canadian agricultural production this analysis indicates that while exchange rates may have had significant impacts on the return to fixed factors and farm income they have had little effect on grain production in the case of livestock feeding in canada exchange rate devaluations may actually reduce production and reduce the return to fixed factors because inputs especially grain are more tradeable than outputs finally we examine the potential welfare impact on nontradeables such as land from changes in the exchange rate theoretical model

exchange rate alignment and producer support estimates pses for india this article examines the effects of exchange rate alignment during 1985 2002 on agricultural producer support estimates pses for india based on several time series techniques the equilibrium exchange rate of the indian rupee and the corresponding misalignment of the actual rate are estimated and applied to recent pse calculations our results show that the exchange rate was substantially misaligned before a financial crisis and macroeconomic reform in the early 1990s with subsequent indirect effects on the pses we find a relatively high pass through of exchange rate movements to domestic agricultural prices so that removal of the exchange rate misalignment would have improved incentives to indian farmers during this period more recently this indirect exchange rate effect is smaller than the direct effect in the pses indicating the dominance of sectoral specific policies over economy wide policies

heteroskedastic sample selection and developing country wage equations many researchers have dealt with potential selectivity bias in developing country wage equations by employing heckman s 1979 two step method or related techniques despite the potential for such methods to produce misleading results if the assumptions on which they are based are incorrect this paper argues that the results produced even by parametric easy to implement selectivity bias correction methods can inspire more confidence than the typical applications to date when model selection testing is used to select from a specified diverse set assumptions for which there is support in the data and when sensitivity analysis is used to identify parameters whose estimates are robust across a wide range of assumptions in particular it highlights the importance of allowing for the nonlinearities implied by selection rule heteroskedasticity there is economic reason to suspect heteroskedasticity and econometric reason to believe that the nonlinearities it introduces into the first stage will improve

generating conditional expectations from models with selectivity bias comment abstract plugging identical values of the mills ratio into estimates of selectivity adjusted wage regressions for men and women generates wage predictions that pertain to men and women with identical unobserved characteristics only under highly restrictive conditions this calls into question the suggestion of vella 1988 and the details of several gender gap decomposition studies

a behavioral model of timber supply abstract a dynamic behavioral model of timber supply is developed the diverse motivation of forest owners is recognized and the implications for optimal harvest patterns is explored this model is particularly relevant for the non industrial private forest nipf sector and has possible uses for public forest management properties of the optimal nipf timber supply curve are established and the effects of various taxes are examined to explore a more structured model simulations are conducted based upon data from a typical redwood region the projections provide indicative results for tax and other timber land policies these results are seen to depend crucially on the forms of the landowner s utility function and upon the function relating standing timber to non income outputs of the forest directions for needed empirical research are then indicated

decomposing changes in agricultural price gaps an application to russia the article develops a method for decomposing changes in agricultural price gaps defined as the difference between a commodity s domestic producer and border prices we use oecd s procedure for decomposing changes in the market price support part of producer support estimates as the starting point for our decomposition method and our method provides a basis for critiquing oecd s decomposition approach the transmission of changes in border prices world prices and the exchange rate to domestic prices is a key element in the decomposition the method is demonstrated using russian agricultural price gaps the results support the argument that for russian agriculture during the transition period the main cause of changes in price gaps has been incomplete transmission of changes in the exchange rate to domestic prices and where the weak transmission results mainly not from policy intervention but rather from deficient market conditions in particular poor market infrastructure the policy implication is that underdeveloped infrastructure has strongly limited the benefits to the russian economy from agricultural trade liberalization

further evidence on the job search theory abstract the prediction of the job search theory that there is a negative correlation between reservation wage and the re employment probability is tested it is found that the unemployed who find a job are a self selecting group of individuals with a relatively low reservation wage

an analysis of selected property tax exemptions for timber recent work in forest tax theory has stimulated renewed discussion of local government taxes on forests several authors for differing reasons have found fault with the traditional fairchild 1935 conclusion that the annual property tax on full market value is always biased against deferred yield forestry trestrail 1969 klemperer 1974 pasour and holley 1976 yet the conclusion among many researchers remains that such a tax is likely to be biased against certain types of forest land use bentick 1979 1980 klemperer 1978 the proper forest property tax modification however is still a topic of much debate some suggest that property taxes be levied only on forest land while exempting timber zivnuska 1969 cartwright and dowdle 1979 as done in several states including tennessee north carolina iowa and alabama carlan 1978 other approaches give partial timber exemptions or replace property taxes with a yield tax at harvest date this article aims to describe the nature and magnitude of property tax biases against certain land uses assuming that tax policy should seek to avoid gross nonneutralities which could distort market allocation of resources this study evaluates potential adjustments in forest property taxes that would achieve greater neutrality the approach will be to review theoretical land use impacts of a property tax on full value of 1 land and improvements for forest and nonforest uses 2 forest land only while taxing land and improvements for other uses and 3 the value of forest land plus forest establishment costs 1 it is found that case 1 would be biased against land uses with long payoff periods or high ratios of improvements to land value and case 2

the surge in capital inflows to developing countries an analytical overview after being excluded from world capital markets during the debt crisis many developing countries have experienced large capital inflows during the past five years the challenges that these inflows pose for domestic policy in recipient countries have generated a substantial literature this article presents an overview of that literature describing the characteristics of the new inflows analyzing the policy issues they raise assessing their causes and likely sustainability and evaluating potential policy responses the desirable policy response is tied to characteristics of the flows themselves as well as to the characteristics of the recipient economy

international comparisons of pricing to market behavior this paper measures the degree of price discrimination across export destinations that is associated with exchange rate changes using u s u k german and japanese industry level data given the industries sampled more price discrimination across destinations is observed in the u k german and japanese data for industries that match across source countries however behavior is very similar across source countries furthermore destination specific price adjustment on exports to the united states from germany and japan is similar to price adjustment observed on shipments to other destinations most variation in the data appears to be related to industry copyright 1993 by american economic association