competition and corporate performance are people right to think that competition improves corporate performance my investigations indicate first that there are some theoretical reasons for believing this hypothesis to be correct but they are not overwhelming furthermore the existing empirical evidence on this question is weak however the results reported here based on an analysis of around 670 u k companies do provide some support for this view most important i present evidence that competition as measured by increased numbers of competitors or by lower levels of rents is associated with a significantly higher rate of total factor productivity growth

the perceived returns to education and the demand for schooling economists emphasize the link between market returns to education and investments in schooling though many studies estimate these returns with earnings data it is the perceived returns that affect schooling decisions and these perceptions may be inaccurate using survey data for eighth grade boys in the dominican republic we find that the perceived returns to secondary school are extremely low despite high measured returns students at randomly selected schools given information on the higher measured returns completed on average 0 20 0 35 more years of school over the next four years than those who were not

a major in science initial beliefs and final outcomes for college major and dropout taking advantage of unique longitudinal data we provide the first characterization of what college students believe at the time of entrance about their final major relate these beliefs to actual major outcomes and provide an understanding of why students hold the initial beliefs about majors that they do the data collection and analysis are based directly on a conceptual model in which a student s final major is best viewed as the end result of a learning process we find that students enter school quite optimistic about obtaining a science degree but that relatively few students end up graduating with a science degree the substantial overoptimism about completing a degree in science can be attributed largely to students beginning school with misperceptions about their ability to perform well academically in science copyright 2014 oxford university press

a few goodmen surname sharing economist coauthors we explore the phenomenon of coauthorship by economists who share a surname prior research has included at most three economist coauthors who share a surname ours is the first paper to have four economist coauthors who share a surname as well as the first where such coauthors are unrelated by marriage blood or current campus jel y9

foreign investment and spillover efficiency in an underdeveloped economy evidence from the mexican manufacturing industry abstract in this paper we consider the question whether differences in technical efficiency of mexican plants in part derive from spillover efficiency associated with foreign direct investment we use labour productivity as a measure of technical efficiency and relate this to capital intensity labour quality and scale of production we measure the degree of competition by different concentration indices and the final factor determining efficiency is the presence of foreign subsidiaries if there is a positive relation between efficiency of domestic plants and the foreign participation of various industries we conclude that there is a spillover of technical efficiency the empirical evidence from the study indicates that this is the case

occupations fields of study and returns to education this paper considers several possible channels behind the well documented effect of education on earnings the first channel is that education makes workers more productive on a given task as in a conventional human capital framework the second channel is based on the idea that education helps workers get assigned to higher paying occupations where output is more sensitive to skill a third and final channel is that workers are more productive and earn more when they are matched to a job related to their field of study using data from the 2005 national graduate survey and the 2006 canadian census i find that channels two and three account for close to half of the conventionally measured return to education the results indicate that the return to education varies greatly depending on occupation field of study and the match between these two factors

choosing the field of study in postsecondary education do expected earnings matter abstract this paper examines the determinants of the choice of the college major when the length of studies and future earnings are uncertain we estimate a three stage schooling decision model focusing on the effect of expected earnings on major choice we control for dynamic selection through the use of mixture distributions exploiting variations across the french business cycle in the relative returns to the majors our results yield a very low though significant elasticity of major choice to expected earnings this suggests that at least for the french university context nonpecuniary factors are a key determinant of schooling choices

college selectivity and earnings this article shows that college performance and selectivity have significant effects on earnings it suggests that work that does not include college performance overstates the effect of college se

determinants of college major choice identification using an information experiment this article studies the determinants of college major choice using an experimentally generated panel of beliefs obtained by providing students with information on the true population distribution of various major specific characteristics students logically revise their beliefs in response to the information and their subjective beliefs about future major choice are associated with beliefs about their own earnings and ability we estimate a rich model of college major choice using the panel of beliefs data while expected earnings and perceived ability are a significant determinant of major choice heterogeneous tastes are the dominant factor in the choice of major analyses that ignore the correlation in tastes with earnings expectations inflate the role of earnings in college major choices we conclude by computing the welfare gains from the information experiment and find positive average welfare gains

competitive consequences of interfirm collaboration how joint ventures shape industry profitability recent international business research on international joint ventures focuses on how firms can use such ventures for knowledge access and learning to enhance their competitiveness thereby increasing competition in the industry by contrast research in industrial organization economics has observed that firms can also use joint ventures in various ways to attenuate competition in this paper we join these two streams of research to investigate the conditions under which joint ventures reduce or enhance competition by empirically testing the effects of different types of joint ventures on industry profitability our results suggest that joint ventures can be pro competitive or anti competitive depending on whether or not they are formed between competing firms represent foreign market entry and operate in relatively concentrated industries our paper shows the importance of adopting a contingent approach to evaluating the competitive implications of joint ventures and it also points to the value of reinvigorating international business research on the competitive context and consequences of interfirm collaboration

education choices and returns on the labor and marriage markets evidence from data on subjective expectations in this paper we analyze the role of expected labor and marriage market returns as determinants of the college enrollment decisions of mexican high school graduates moreover we investigate whether the relative weights of these factors differ by gender we use data on individuals expectations regarding future labor market outcomes which we directly elicited from the youths and two different measures of marriage market returns first marriage market returns are proxied by the net supply of potential partners in the youths local marriage markets second we use data which elicits youths beliefs about their future spouse s earnings conditional on their own education level we find that labor market as well as marriage market returns are important determinants of the college enrollment decision however boys and girls preferences differ in terms of the relative role of the two determinants in that the relative weight of labor market versus marriage market returns is larger for boys than for girls

the theory and measurement of producer response under quotas tobin and houthakker s work on consumer behavior under quantity rationing has been extended by many authors especial ly through the use of duality theory this paper uses duality theory to extend the work on demand theory under rationing to the case of producer behavior under quotas these results permit estimation of otherwise unobservable market supply and demand structures the structure of the farm economy operating under a tobacco quota system is estimated and the theory is utilized to infer that the supply elasticity of tobacco would be about 7 0 if the quotas were removed estimates such as this are not normally attainable without the theor y outlined here even though they are essential for the evaluation of policy changes copyright 1993 by mit press

on the relationship between firm size and export intensity export marketing literature supports the view that firm size is positively related to export intensity although the empirical findings have been mixed a number of theoretical arguments are used to support this proposition i e international marketing economies of scale limited managerial and financial resources of small firms decisionmaker s risk perception based on a large survey of the italian manufacturing industry the article falsifies the proposition and challenges some widely held assumptions in export marketing literature

intended college attendance evidence from an experiment on college returns and costs abstract we conduct an information experiment about college returns and costs embedded within a representative survey of us household heads baseline perceptions of college costs and benefits are substantially biased with larger biases among lower income and non college households respondents are randomly exposed to objective information about average college returns or costs we find a significant impact of the returns experiment persisting in a follow up survey two months later intended college attendance expectations increase by about 0 2 of the standard deviation in the baseline likelihood and gaps by household income or parents education decline by 20 30 we find no impact of the cost information treatment further analysis supports the information s salience as opposed to information based updating as the main channel through which the returns intervention impacts intentions

the structure of technology in brazilian sugarcane production 1975 87 an application of a modified symmetric generalized mcfadden cost function sugarcane based ethanol has become a primary automotive fuel in brazil over the past 15 years because sugarcane costs are over two thirds of the costs of ethanol production the economic efficiency of this renewable petroleum substitute hinges on the structure of technology in sugarcane production in this paper a modified symmetric generalized mcfadden sgm cost function for sugarcane is estimated and the presence of technical change and economies of scale are investigated the original sgm proposed by diewert and wales 1987 is modified to allow for fixed factors of production this allows the cost function to be applied to processes which have fixed factors the results suggest that there is no empirical evidence of economies of scale and very little technical change only in the north of brazil the implications for the future economic efficiency of this petroleum substitute are discussed

varieties in state capitalism outward fdi strategies of central and local state owned enterprises from emerging economy countries institutional diversity characterizing state owned enterprises soes from emerging economies holds critical but under examined implications for their internationalization activities different types of soes can exhibit distinct motivations strategic resources and adaptive capabilities for penetrating foreign markets to understand how such idiosyncratic differences emerge we conceptualize the heterogeneity of soes as an outcome of multiple institutional reform processes administrative and fiscal decentralization industrial restructuring and market liberalization which create diversity between soes affiliated with central and local levels of government building on the idea of institutions as configurations we elucidate how such reforms reconfigure soes constellation of resources capabilities and priorities which shape the parameters of their ability to negotiate for home and host country institutional legitimacy specifically we propose that the restructuring of central soes into national champions exposes them to stronger institutional pressures from home and host country governments while local soes which have fewer obligations to serve national strategic prerogatives display greater managerial autonomy and market orientation but lower levels of monopolistic behavior we discuss how such contrasting attributes contribute to variations in soes international business diversification patterns foreign subsidiary establishment and ownership modes and overseas location preferences recognition of soes organizational diversity holds important implications for theories on state owned multinationals

inefficiencies in the uk milk quota system abstract given that the common agricultural policy cap of the european union has imposed milk marketing quota on producers the fact that they are tradeable in the uk increases economic efficiency nevertheless significant inefficiencies remain modelling work reported here suggests that significantly more quota needed to be transferred from less to more efficient producers in 1996 97 for industry efficiency to be maximised and that a large number of vulnerable inefficient producers remained in milk production it is also shown that despite tradeable quotas a significant number of dairy farmers still achieve a poor match between available quota and production it is argued that the rules on quota trading could be changed to increase efficiency finally it is argued that uk milk producers are incurring costs for acquiring quota which add at least 12 5 to production costs a high price to pay for the market stability which quotas have brought

multinationals and industrial policy are there benefits to the host country from multinational investments does potential value from these investments make active industrial policy worthwhile we answer the first question affirmatively having reviewed economic principles and evidence concerning the effects of projects locating in or not being off shored from a country on the second policy can have a limited effect in influencing location decisions but it is doubtful that it is cost effective implementation faces lack of information risk of capture and in many cases non rigorous processes competition between jurisdictions means that much policy is investment diversion not investment creation there is a case for supra national controls as with eu state aid regulations for policy to be used only for well defined market failures and for better implementation and more rigorous ex ante appraisal and ex post evaluation copyright 2013 oxford university press

diseconomies of size with fixed managerial ability managerial ability has important implications for farm growth in this article we first show in a production model that increasing output with a fixed level of managerial ability can lead to a decrease in profits next we discuss the effect that managerial ability has on economies of size in the empirical part economies of size are estimated for a sample of dairy farms using a proxy for managerial ability which is calculated as a technical efficiency index the results show that increasing farm size while holding managerial ability constant can be an important source of diseconomies of size copyright 2003 oxford university press

entry exit and farm size assessing an experiment in dairy price policy this article models and estimates the forces behind farm exits and changes in herd size among connecticut dairy farms under the new england dairy compact a model of sunk costs and farm capital investment is used to specify two econometric estimations a random effects probit model of farm entry and exit and an autocorrelated generalized least squares panel data model of farm size the dairy compact s price strategy reduced farm exits and moderately increased cow numbers in contrast development pressures and historically low unemployment rates increased farm exits

forming wage expectations through learning evidence from college major choices abstract how do college students choose their majors and what role does the family play in their choices i use data from two major longitudinal surveys to develop and estimate a model in which students learn about earning opportunities associated with different majors through the wages of older siblings and parents the probability of a student choosing a major that corresponds to the occupation of a family member is strongly correlated with the family member s wage at the time the major choice is made this correlation remains strong after controlling for family correlated abilities or preferences and additional empirical evidence suggests that the observed correlation arises through a family based wage information channel

stated and revealed heterogeneous risk preferences in educational choice abstract we develop a structural microeconometric model of educational choice with unobserved heterogeneity in risk aversion and estimate the model parameters using panel survey data we assess the credibility of the model by linking the estimated structural parameters of risk aversion to the self reported willingness to take risks which is directly elicited in the survey the risk aversion parameters revealed from educational choices decrease with the willingness to take risks stated by the survey respondents this indicates consistency between stated and revealed risk preferences we suggest that this method could be applied more generally to support or reject the joint validity of structural models and survey measures of preferences

foreign investment and productive efficiency the case of mexico this paper examines whether the relative performance of firms within mexican manufacturing industries varies systematically with the presence of foreign subsidiaries it also analyzes how foreign entry influences the technological structure in host country industries the findings suggest that 1 foreign presence in an industry is positively correlated with structural efficiency and 2 foreign entry is related to structural changes only in the modern part of the industries the most important source of spillover efficiency is found to be in the competitive pressure induced by the foreign firms i introduction a widely held view among economists studying foreign investment is that one of the important contributions to the host country is likely to stem from external effects or spillovers the spillovers can be of different kinds the foreign firms may influence the productivity and growth of the domestically owned firm they may change the nature and evolution of concentration they may alter financing marketing and technological and managerial practices in the industries that they enter et cetera because of great methodological difficulties in investigating these effects empirically in addition to lack of data few empirical investigations appear in the literature three available econometric studies deal with the influence of foreign investment on the technical efficiency of host country firms one focuses on australia caves 1974 one on canada globerman 1979 and one on mexico blomstrom and persson 1983 all three find some support for the spillover benefit hypothesis but none of the studies analyzes the nature of spillover efficiency in depth the present paper is an attempt to identify through what mechanisms the spillover efficiency of foreign investment takes place by analyzing the effects of foreign investment on the productive efficiency of the industrial structure in mexico we will examine whether the relative performance of firms within an industry varies systematically with the presence of foreign subsidiaries we will also analyze the impact of foreign investment on structural change that is how foreign entry influences the technological structure in host country industries

investment over the business cycle insights from college major choice this paper examines the relationship between individuals personal exposure to economic conditions and their investment choices in the context of human capital focusing on bachelor s degree recipients we find that birth cohorts exposed to higher unemployment rates during typical schooling years select majors that earn higher wages that have better employment prospects and that more often lead to work in a related field much of this switching behavior can be considered a rational response to di erences in particular majors labor market prospects during a recession however higher unemployment leads to other meaningful changes in the distribution of majors conditional on changes in lifetime expected earnings recessions encourage women to enter male dominated fields and students of both genders pursue more dicult majors such as stem fields these findings imply that the economic environment changes how students select majors possibly by encouraging them to consider a broader range of possible degree fields finally in the absence of this compensating behavior we estimate that the average estimated costs of graduating in a recession would be roughly ten percent larger jel e32 i23 j22 j24

decomposition of productivity growth using distance functions the case of dairy farms in three european countries within an output distance function framework the total factor productivity growth index is decomposed into four components technical change technical and allocative efficiency and scale component we estimate stochastic translog output distance functions using panel data from dairy farms over the period 1991 94 for three european countries germany the netherlands and poland results indicate that the change in the productivity growth index in germany 6 and poland 5 are mainly dictated by the technical change component in contrast the productivity growth index in the netherlands 3 is influenced by allocative efficiency components

the importance of tax adjustments when evaluating wage expectations using elicited expectations of future gross salaries we evaluate characteristics causing german students to make larger or smaller estimation errors while students seem to underestimate actual salaries by 18 percent we show that these errors are highly attributable to misconceptions of the progressive income tax developing a suitable adjustment procedure we correct students estimates and find that errors decline by 12 percentage points conducting regression analyses we reveal strong connections with students age gender work experience secondary school track and knowledge about student loans these results change notably if not controlling for students misconceptions of the tax system

the economics of schooling production and efficiency in public schools n recent years public and professional interest in schools has been heightened by a spate of reports many of them critical of current school policy these policy documents have added to persistent and long standing concerns about the cost effectiveness and fairness of the current school structure and have made schooling once again a serious public issue as in the past however any renewed interest in education is likely to be short lived doomed to dissipate as frustration over the inability of policy to improve school practice sets in this frustration about school policy relates directly to knowledge about the educational production process and in turn to underlying research on schools although the educational process has been extensively researched clear policy prescriptions flowing from this research have been difficult to derive 2 there exists however a consistency to the research findings that does have an immediate application to school policy schools differ dramatically in quality

fdi spillovers over time in an emerging market the roles of entry tenure and barriers to imitation in this study we examine how foreign direct investment fdi spillovers to domestic firms in an emerging market occur over time from the organizational learning perspective we propose that as entry tenure of foreign firms in an industry increases domestic firms can learn from the foreign firms over time and improve their productivity we further build upon the competitor imitation argument to propose that this effect will be stronger when barriers to imitation faced by the domestic firms are lower based upon a comprehensive panel dataset on manufacturing firms in china in 1998 2007 our findings strongly support these arguments we find that entry tenure of foreign firms in an industry has a positive relationship with the productivity of individual domestic firms in the same industry albeit at a diminishing rate we also find that this positive relationship is stronger when the foreign firms have lower export intensity lower intangible asset intensity and have followed a more rhythmic i e less irregular entry pattern situations characterizing lower barriers to imitation

survey measures of family decision processes for econometric analysis of schooling decisions in this article we consider the collection of novel subjective data on family processes of schooling decisions in particular we review recent progress on survey measurement of expectations information and locus of decision of american families within the context of secondary schooling and we discuss possible future developments by providing concrete examples from recent exploratory efforts we argue that collection of data on adolescents and parents perceptions of the available school options and the application and admission rules their subjective expectations about short and long term consequences of alternative choices and their assessments of the locus of decision making within families could greatly enhance economic modeling and contribute to effective econometric analysis of schooling decisions jel c83 d19 d79 d83 d84 i21 i26 j24

foreign direct investment and host country productivity the american automotive component industry in the 1980s although several studies have shown that inward foreign direct investment fdi often leads to greater host country productivity researchers have yet to determine the relative importance of direct technology transfer and competitive pressure to assess the relative importance of the two channels we examine the us auto component industry between 1979 and 1991 during this period japanese automobile assemblers began to produce vehicles in north america and began to purchase inputs from us auto component manufacturers those us manufacturers that sold components to japanese transplants would be the direct recipients of any technologies transferred from the japanese although we find that the direct investment by japanese assemblers was associated with overall productivity improvement in the us auto component industry we find little evidence of direct technology transfer the productivity growth of us suppliers affiliated with japanese assemblers was no greater than that of other non affiliated us suppliers further we find that the japanese assemblers tended to purchase components from less productive us suppliers and moreover that low productivity suppliers that sold goods to japanese assemblers had a higher survival rate than low productivity suppliers that did not sell to japanese firms the results suggest that increased competitive pressure in the auto sector was the main cause of overall productivity improvement at least during the initial stages of fdi of the 1980s

ex ante returns and occupational choice using data from duke university undergraduates we make three main contributions to the literature first we show that data on earnings beliefs and probabilities of choosing particular occupations

policy uncertainty and the sequence of entry by japanese firms 1980 1998 we extend the stages model of internationalization to incorporate a sophisticated consideration of temporal and cross national variation in the uncertainty of the policy environment using a sample of 6465 international expansions of 665 japanese manufacturing firms in 49 countries we develop arguments from internationalization and bargaining power perspectives to show how japanese firms manage policy uncertainty in host country environments through the within country sequencing of investments although a distribution to manufacturing entry sequence tends to prevail in countries with low levels of policy uncertainty as uncertainty in the policy environment increases initial entry by distribution is increasingly likely to be eschewed in favor of an initial entry by a joint venture manufacturing plant we suggest that this change in investment sequence occurs as firms shift from an emphasis on developing knowledge about local markets and consumers in low hazards markets to an international expansion strategy in uncertain policy environments that places knowledge development of the policy environment at the forefront of a firm s strategy

the dynamics of the liability of foreignness a global study of survival in financial services we study the impact of foreignness on survival in interbank currency trading worldwide over the period 1974 93 in particular we develop hypotheses on the behavior of the liability of foreignness over time and on the consequences of evolving sources of firm level competitive advantage on this liability we test these hypotheses on the population of 2667 market making trading rooms located in 47 countries worldwide that either existed in 1974 or entered the industry between 1974 and 1993 the results show that there is a liability of foreignness and that it changes over time further strategic and organizational factors such as the adoption of technology by these firms and their mode of internal control significantly influenced survival as did location related factors such as the intensity of local and foreign competition 1997 by john wiley sons ltd

technology and efficiency in a panel of italian dairy farms an sgm restricted cost function approach this article employs a short term specification of the symmetric generalised mcfadden sgm cost function capable of accommodating quasi fixed factors and variable returns temporary equilibrium and scale economies are investigated while maintaining the consistency of the estimated model with microeconomic theory and approximation properties it also makes use of a two step procedure to estimate first the technology parameters and then time varying efficiency at farm level no distributional assumptions are required on efficiency as we consider a fixed effect model a balanced panel of italian dairy farms during the years from 1980 to 1992 serves as the case study the results suggest a rigid productive structure during the pre and post quota period moreover italian milk producers are found to exhibit considerable excess capacity and rather low input technical efficiency

college choice as a collective decision although the choice between colleges can be thought of as being made collectively by a family models of educational choice almost universally portray the decision as made by the student alone using a novel experimental method for identifying collective decision functions i find that students have more influence than parents over the decision but not exclusive control students care more than parents about classroom experience and future earnings ignoring the dual agent nature of the decision can weaken predictions and lead to poorly targeted policy designs jel i21 j24 d13

the price is right updating inflation expectations in a randomized price information experiment abstract using a unique randomized information experiment embedded in a survey this paper investigates how consumers inflation expectations respond to new information we find that respondents on average update their expectations in response to certain types of information and do so sensibly in a manner consistent with bayesian updating as a result of information provision the distribution of inflation expectations converges toward its center and cross sectional disagreement declines we document heterogeneous information processing by gender and present suggestive evidence of respondents forecasting under asymmetric loss our results provide support for expectation formation models in which agents form expectations rationally but face information constraints

preference for the workplace investment in human capital and gender we use a hypothetical choice methodology to estimate preferences for workplace attributes from a sample of high ability undergraduates attending a highly selective university we estimate that women on average have a higher willingness to pay wtp for jobs with greater work flexibility and job stability and men have a higher wtp for jobs with higher earnings growth these job preferences relate to college major choices and to actual job choices reported in a follow up survey four years after graduation the gender differences in preferences explain at least a quarter of the early career gender wage gap

quota prices as indicators of comparative advantage in supply managed industries the canadian farm products agencies act 2012 requires that comparative advantage be used to guide the allocation of new quota under supply management this requirement however has not been met in practice agricultural economists have proposed several ways of making this legal requirement operational we review and evaluate these proposed approaches and find that quota prices are the only direct measure of comparative advantage in supply managed industries we develop an agent based general equilibrium model of quota exchange to illustrate the use of quota prices as indicators of comparative advantage our approach complements the proposal by meilke 2009 to use quota prices as indicators of comparative advantage in supply managed industries and also addresses the concerns of larue and gervais 2008 that quota prices may not be theoretically consistent with comparative advantage we also discuss potential practical challenges of using quota prices as indicators of comparative advantage in the canadian supply managed industries finally we provide an example of calculating provincial shares of new quota using recent quota price data according to two prototype decision rules this abstract was borrowed from another version of this item

earnings expectations revisions and realizations during the spring and the fall of 1993 respondents to a national household survey were asked to report expectations of spring 1994 weekly earnings elicited in the form of subjective probabilities these data are potentially much more informative than are typical reports of economic expectations subjective probability distributions of future weekly earnings are estimated for each respondent based on his or her reports of a series of subjective probabilities this paper analyzes the cross sectional variation in expectations revisions of expectations between the spring and the fall of 1993 and the relationship between 1993 expectations and the distribution of spring 1994 earnings realizations generally positive findings on the validity of the data bode well for the prospects of eliciting expectations in future surveys

group decision making with uncertain outcomes unpacking child parent choice of the high school track predicting group decisions under uncertainty requires disentangling individual members utilities over the consequences of choice their expectations for uncertain outcomes and their choice process as a group i estimate simple bayesian models of child parent choice of high school track with subjective risk and unilateral or bilateral nonstrategic decisions by combining families actual choices with novel survey information about children s and parents subjective probabilities over choice consequences their individually preferred choices and their decision roles a set of policy counterfactuals confirms the importance of introducing the beliefs and decision roles of individual members in models and policy analysis of group decisions

determinants differentiation and development of short term marginal costs in dairy production an empirical analysis for selected regions of the eu this work provides evidence on the determinants cost differentiation and development of short term marginal costs of dairy farms in important production regions of the european union the empirical study is based on the estimation of multi input multi output symmetric generalized mcfadden cost functions using an unbalanced panel data set of the european farm accountancy data network the results show considerable regional differences in the impact of the outputs input prices and fixed factors on marginal costs strong evidence can be found that marginal costs decrease over time and is further underlined by the development of derived regional aggregated short term supply curves marginal cost elasticities and correlation coefficients validate the hypotheses that a high degree of farm specialization large milk output and low milk prices are associated with lower marginal costs furthermore the marginal cost spread in the data sample is analyzed we show that milk output milk yield herd size labor input and fodder production can be attributed to significant marginal cost differentiation of farms whereas for crop and animal output grassland stock of other animals and depreciation only minor differentiation can be found

do peers influence occupational preferences evidence from randomly assigned peer groups at west point abstract there is substantial variation across occupations in outcomes such as earnings job satisfaction and health yet little is known about how occupational preferences are shaped and evolve this paper assesses a channel that may influence occupational preferences peer effects by exploiting unique institutional features and a natural experiment at west point to document the way students i e cadets occupational preferences evolve and to test for peer effects after graduation cadets must enter the u s army as an officer in one of 16 occupational branches and are required to rank order their preferences for the branches repeatedly over four years west point randomly assigns cadets to social groups both at broad company and narrow roommate levels we leverage the timing of the randomization and preference elicitations to test for peer effects at the company roommate and older peer levels with the possible exception of the first few weeks of exposure we find little evidence of peer effects we also use a survey of cadets to explore mechanisms and find evidence that peer information may not be credible in this case but rather cadets rely on mentors and job characteristics when making this decision

correlation consumption confusion or constraints why do poor children perform so poorly the economic and social mobility of a generation may be largely determined by the time it enters school given early developing and persistent gaps in child achievement by family income and the importance of adolescent skill levels for educational attainment and lifetime earnings after providing new evidence of important differences in early child investments by family income we study four leading mechanisms thought to explain these gaps an intergenerational correlation in ability a consumption value of investment information frictions and credit constraints in order to better determine which of these mechanisms inf uence family investments in children we evaluate the extent to which these mechanisms also explain other important stylized facts related to the marginal returns on investments and the effects of parental income on child investments and skills

knowledge seeking and location choice of foreign direct investment in the united states to what extent do firms go abroad to access technology available in other locations this paper examines whether and when state technical capabilities attract foreign investment in manufacturing from 1987 1993 we find that on average state r d intensity does not attract foreign direct investment most investing firms are in lower tech industries and locate in low r d intensity states suggesting little interest in state technical capabilities in contrast we find that firms in research intensive industries are more likely to locate in states with high r d intensity foreign firms in the pharmaceutical industry value state r d intensity the most at a level twice that of firms in the semiconductor industry and four times that of electronics firms interestingly not only firms from technically lagging nations but also some firms from technically leading nations are attracted to r d intensive states this suggests that beyond catching up firms use knowledge seeking investments also to source technical diversity

partial market liberalization and the efficiency of policy reform the case of the european dairy sector this article analyzes the efficiency of partial market liberalization and policy reform with an application to the european dairy sector in a second best world partial moves toward market liberalization are not always efficiency improving we develop a general equilibrium model to investigate the efficiency implications of discrete changes in government policy the analysis covers price and quantity instruments used in both domestic and trade policy we derive simple conditions under which partial market liberalization is efficiency improving we apply the approach to agricultural policy reform in the european dairy sector and identify market liberalization scenarios that are not efficiency improving

perspectives on multinational enterprises in emerging economies multinational enterprises mnes play a pivotal role in the development of many emerging economies in consequence they became the focus of scholarly research by economists and policy analysts in contrast international business scholars have been comparatively uninterested in analysing this role of mnes yet they could make important contributions to these debates first studies taking the individual firms as starting point would enhance understanding of the interaction between mnes and the local environment second theories and research methodologies developed in international business research could provide new insights into the dynamics of mnes in emerging economies the objective of this paper is to motivate more international business scholars to engage in research on positive and negative spillovers from foreign direct investment fdi in emerging economy societies to advance this research agenda scholars need to analyse the specific activities and capabilities of the firms involved and the impact of fdi on the broader social and environmental context for management this agenda raises the ethical question to what extent ought businesses to care about their local stakeholders

technical efficiency and co2 abatement policies in the dutch glasshouse industry this paper develops a short run microeconomic simulation model of the dutch glasshouse industry in order to investigate the relation between technical efficiency and marginal abatement costs of co2 emission the model is also used to determine the effects of an emission tax and systems of tradable and non tradable quota for groups of firms with different rates of technical efficiency the results show that marginal abatement costs are very responsive to changes in technical efficiency furthermore it is found that firms with a low technical efficiency are faced with a higher profit reduction under different abatement policies than firms with a high technical efficiency

the swiss payment for milk processed into cheese ex post and ex ante analysis we make use of both an ex post and an ex ante evaluation to analyze the swiss payment for milk processed into cheese this payment for each kilogram of raw milk processed into cheese is issued to milk producers through dairy processors in the ex post evaluation by applying a vector autoregressive model we estimate the effects of reductions of the payment for prices of raw milk used to produce emmentaler gruyere and industrial cheese past declines in the payment have only been partially transmitted to raw milk prices the rate of transmission is higher for milk used for the production of industrial cheese than for artisan cheeses in the ex ante impact evaluation we use a partial equilibrium model and develop a counterfactual scenario in which the payment is removed the payment for milk processed into cheese is found to have effects on cheese production and exports but also has important indirect effects on other dairy products our findings suggest that about two thirds of the payment are benefiting milk producers at the same time the overall welfare losses resulting from the elimination of the aid are smaller than the budget allocated to this measure suggesting a net welfare gain from elimination

explaining differences in milk quota values the role of economic efficiency this paper explores the relationship between milk quota values and economic efficiency in order to analyze current government interventions in quota allocations among producers for this purpose we estimate a short run variable cost function using a panel of spanish dairy farms quota values are then decomposed into economic efficiency price and scale effects in order to assess the relative influence of these factors on quota values we find that efficiency is important in explaining quota values but is uncorrelated with observable farm characteristics this casts doubts on the government s ability to allocate quotas to efficient farms in the way a well functioning quota market does

grade inflation and course choice a conflict exists between the incentives offered to students and the institutional goal of increased science and math education students make their course choices in response to a powerful set of incentives grades these incentives have been systematically distorted by the grade inflation of the past 25 years as a consequence of inflation many universities have split into high and low grading departments economics along with chemistry and math tends to be low grading art english philosophy psychology and political science tend to be high grading this paper presents evidence from nine colleges and universities that grade inflation has led to a divergence among departments in grading policies we then discuss the results of an econometric study we conducted at williams college of the influence of grading policies on course choice the impact that differences in grading policies across departments have on the distribution of enrollments was also estimated and policy implications of the findings are discussed

subjective and projected returns to education abstract there is significant heterogeneity over high school students in the wage and employment rate returns to education i evaluate this heterogeneity using subjective returns derived from a data set of high school juniors and seniors in washington state variation over observables in projected returns estimated using observed data is uncorrelated with variation in subjective returns elicited by directly asking students about their beliefs these results mean that returns estimated using observed data are likely a very weak proxy for student beliefs

biases in frontier estimation due to heteroscedasticity abstract this paper investigates the effects of heteroscedasticity on the parameters in frontier regression models a monte carlo experiment is employed to determine that heteroscedasticity leads to overestimation of the intercept and underestimation of the slope coefficients

beauty job tasks and wages a new conclusion about employer taste based discrimination using novel data from the berea panel study we show that the beauty wage premium for college graduates exists only in jobs where attractiveness is plausibly a productive characteristic a large pr

changes in college skills and the rise in the college wage premium the college wage premium for new labor market entrants rose sharply during the 1980s we ask how much of this change arose from changes in the skill level of the typical college graduate we find that skills attained prior to college as measured by standardized test scores and high school grades had no effect on the change in the college wage premium for men in contrast the returns to math ability rose considerably for women failing to account for math skills thus substantially overstates the growth in the female college wage premium skills acquired in college as reflected in the distribution of students across majors had important effects on the relative wages of men the trend away from low skill subjects such as education and toward high skill subjects such as engineering accounts for one fourth of the rise in the male college wage premium

university differences in the graduation of minorities in stem fields evidence from california the low number of college graduates with science degrees particularly among underrepresented minorities is of growing concern we examine differences across universities in graduating students in different fields using student level data on the university of california system during a period in which racial preferences were in place we show significant sorting into majors based on academic preparation with science majors at each campus having on average stronger credentials than their non science counterparts students with relatively weaker academic preparation are significantly more likely to leave the sciences and take longer to graduate at each campus we show the vast majority of minority students would be more likely to graduate with a science degree and graduate in less time had they attended a lower ranked university similar results do not apply for non minority students

economic rents under supply controls with marketable quota we analyze the distribution of economic rent between owners and renters of marketable production quotas and examine how this distribution changes with increases in marginal costs while quota owners unambiguously lose because of a marginal cost increase quota renters may gain depending on whether the marginal cost shift is divergent parallel or convergent using output and input prices county production quotas and quota rental rate data we estimate a marginal cost function for north carolina flue cured tobacco to demonstrate how wage increases affect owners and renters welfare

the demand for and return to education when education outcomes are uncertain this article treats education as a sequential choice that is made under uncertainty a simple model is used to explore the effects of ability high school preparation preferences for schooling the borrowing rate and ex post payoffs to college on the probability of various post secondary college outcomes and the ex ante return to starting college the model motivates an empirical method of accounting for uncertainty about educational outcomes and for nonlinearity in the relationship between years of education and earnings when estimating the expected return to the first year of college

choice of specialization do peers matter social influence is an important factor in learning and decision making we estimate peer influence on student choice of specialization using data on undergraduate students of a russian university information about individual social ties has been gathered from a questionnaire survey we show that specialization choice is significantly influenced by friends as well as by study partners the strongest effect is produced by friends who are study partners and those who have similar academic achievements reciprocal friendship ties have a stronger influence on the choice than nonreciprocal ones also the decision is affected by classmates with similar academic achievement the results allow us to better understand the mechanisms of peer effects in the specialization choice

the effect of credit constraints on the college drop out decision a direct approach using a new panel study a serious difficulty in determining the importance of credit constraints in education arises because standard data sources do not provide a direct way of identifying which students are credit constrained this paper differentiates itself from previous work by taking a direct approach made possible by unique longitudinal data from the berea panel study the results from our study of berea college students suggest that while credit constraints likely play an important role in the drop out decisions of some students the large majority of attrition of students from low income families should be primarily attributed to reasons other than credit constraints jel i21 i22

quota mobility and quota values abstract the institutional arrangements governing quota mobility influence quota prices and the structural development of the dairy sector this article considers milk quotas in a number of oecd countries where they are applied under different conditions and with various policy goals pressure to free quota markets and to increase quota mobility is inherent in a quota system in a market economy unless very strict government rules are applied this implies that quota rights are capitalized in quota prices which increases the financial burden of new producers among others improving quota mobility by organizing quota trade or leasing will speed up structural development empirical research tends to confirm economic theory about the factors which determine quota values larger and or more efficient farms increase their share in milk production by trading or leasing

spillovers in education choice abstract this paper examines how skills are shaped by social interactions in families we show that older siblings causally affect younger sibling s educational choices and early career earnings we focus on critical course choices in high school and overcome the identification challenges of estimating spillover effects in education by exploiting exogenous variation in choice sets stemming from a pilot program the pilot induced an essentially random subset of older siblings to choose advanced math science at a lower cost while not directly affecting the course choices of younger siblings we find that younger siblings are 2 3 percentage points more likely to choose math science if their older sibling unexpectedly could choose math science at a lower cost we argue that the main influence of the pilot program on the younger siblings may be attributed to the social influence of the older sibling spillovers are strongest among closely spaced siblings in particular brothers and they have a lasting impact on the career outcomes of younger brothers we argue that competition is likely one of the driving forces behind younger siblings conforming to their older siblings choices

parental beliefs about returns to educational investments the later the better in this paper we study parental beliefs about the returns to parental investments made during different periods of childhood using two independent samples we document that parents perceive the returns to different late investments to be higher than the returns to early investments and that they perceive investments in different time periods as substitutes rather than complements we show that parental beliefs about the returns to investments vary substantially across the population and that individual beliefs are predictive of actual investment decisions moreover we document that parental beliefs about the productivity of investments differ significantly across socioeconomic groups perceived returns to early parental investments are positively associated with household income thereby potentially contributing to the intergenerational persistence in earnings

field of study earnings and self selection why do individuals choose different types of post secondary education and what are the labor market consequences of those choices we show that answering these questions is difficult because individuals choose between several unordered alternatives even with a valid instrument for every type of education instrumental variables estimation of the payoffs require information about individuals ranking of education types or strong additional assumptions like constant effects or restrictive preferences these identification results motivate and guide our empirical analysis of the choice of and payoff to field of study our context is norway s post secondary education system where a centralized admission process covers almost all universities and colleges this process creates credible instruments from discontinuities which effectively randomize applicants near unpredictable admission cutoffs into different fields of study at the same time it provides us with strategy proof measures of individuals ranking of fields taken together this allows us to estimate the payoffs to different fields while correcting for selection bias and keeping the next best alternatives as measured at the time of application fixed we find that different fields have widely different payoffs even after accounting for institutional differences and quality of peer groups for many fields the payoffs rival the college wage premiums suggesting the choice of field is potentially as important as the decision to enroll in college the estimated payoffs are consistent with individuals choosing fields in which they have comparative advantage we also test and reject assumptions of constant effects or restrictive preferences suggesting that information on next best alternatives is essential to identify payoffs to field of study