bonus culture competitive pay screening and multitasking to analyze the impact of labor market competition on the structure of compensation we embed multitasking and screening within a hotelling framework competition for talent leads to an escalation of performance pay shifting effort away from long term investments risk management and cooperation efficiency losses can exceed those from a single principal who dulls incentives to extract rents as competition intensifies monopsonistic underincentivization of low skill agents first decreases and then gives way to growing overincentivization of high skill ones aggregate welfare is thus hill shaped while inequality tends to rise monotonically bonus caps can help restore balance in incentives but may generate other distortions

the effects of human resource management practices on productivity a study of steel finishing lines the authors investigate the productivity effects of innovative employment practices using data from a sample of thirty six homogeneous steel production lines owned by seventeen companies the productivity regressions demonstrate that lines using a set of innovative work practices which include incentive pay teams flexible job assignments employment security and training achieve substantially higher levels of productivity than do lines with the more traditional approach which includes narrow job definitions strict work rules and hourly pay with close supervision their results are consistent with recent theoretical models which stress the importance of complementarities among work practices

assessing the system and investor value of utility scale solar pv abstract with pressure to reduce greenhouse gas emissions from the energy and other sectors policymakers are increasingly seeking to mobilise investment in renewable electricity with support mechanisms the objective of this paper is to assess the value of utility scale solar pv using a multidisciplinary approach in many cases renewable energy strategies are developed by investors and policymakers on the basis of a relatively narrow analysis of costs however as policies should be designed to maximise societal welfare a wider paradigm is needed in decision making this paper argues for an impact assessment of renewable electricity generation that integrates its value from investor utility policy maker and end user perspectives we propose a multidisciplinary approach to the assessment combining engineering production cost estimation with financial and market analysis of utility scale solar pv in ireland the results show that while from an investor s perspective solar pv generation is and will likely remain so for the foreseeable future relatively expensive in a country with low solar irradiation such as ireland there are benefits for the electricity system in terms of reduced wind curtailment and to a lesser extent co2 emissions this demonstrates why the wider costs and benefits of integrating a renewable electricity technology to the system need to be considered in assessment of renewable policy support mechanism policy makers can then seek to maximise the system benefits while minimising the cost of any policy supports

public preferences for investments in renewable energy production and energy efficiency abstract in this paper we investigate the choices citizens make when asked to express willingness to support a proposed energy policy and are then compelled to allocate the program funds to either renewable energy or energy efficiency in a survey study based on a random sample of residents of the state of maine usa we find that citizens have preferences for specific types of renewable energy but these preferences do not yield significantly different allocation of investment funds between renewable energy and energy efficiency we find that preferences are generally consistent regardless of presentation of options i e limited ordering effects our results also indicate that personal characteristics that are understudied in the energy literature including promotion prevention focus and social fiscal leanings influence both willingness to support energy policies and also their allocation of fund choices but in different ways this suggests the importance of including multiple options in energy policy proposals and that targeted messages regarding the components of such policies is key for optimal communication

incentives and transactions costs within the firm estimating an agency model using payroll records we estimate an agency model using the payroll records of a copper mine that paid a production bonus to teams of workers we estimate the cost of incomplete information due to insurance and incentives considerations and the inefficiency caused by the simple form of the incentive contract itself at the estimated parameters the cost of worker risk aversion insurance is of similar magnitude to moral hazard incentives overall incomplete information accounted for one half of the bonus system s inefficiency relative to potential full information profits the other half is attributed to the bonus system s inefficient generation of incentives and insurance relative to the optimal incentive contract

the effect of wage subsidies on piece rate workers evidence from the penny per pound program in florida abstract this paper studies a fair trade program in which consumers provide a wage subsidy bonus to piece rate tomato pickers the total subsidy determined by sales to participating buyers is divided among workers based on their relative output a worker who produces more gets a larger share of the bonus although seemingly mimicking the existing piece rate pay scheme the mechanism associated with the bonus payment is really a relative performance evaluation as the size of total bonus is exogenous and invariant to workers effort therefore for a given sized subsidy the combined total or per worker average utility gains would become the largest if the workers keep their efforts at the pre program level empirical analysis shows that worker effort and hence productivity increases substantially in response to the program suggesting that currently workers combined gains per dollar of subsidy are not being maximized

assessing the case for social experiments rs ecent academic debates pit two alternative approaches to policy evaluation against one another the first is the experimental approach based on the random assignment of accepted program applicants to a recipient or treatment group and a non recipient or control group the second is the nonexperimental or econometric approach that uses a variety of microdata sources statistical methods and behavioral models to compare the outcomes of participants in social programs with those of nonparticipants the central question addressed in this paper is whether or not randomized social experiments aid in securing answers to basic questions about the evaluation of social programs there are many distinct and complementary approaches to the study of the impact of public policy including full general equilibrium analysis of policy impacts tinbergen 1956 auerbach and kotlikoff 1987 shoven and whalley 1992 kydland and prescott 1991 and less ambitious partial equilibrium microeconomic structural research programs such as those designed to estimate the impact of taxes on labor supply both approaches offer answers to many interesting counterfactual policy questions but their credibility rests critically on the quality of the empirical input used to generate their answers

piece rates for professors using panel data we demonstrate a 50 increase in research productivity following a dramatic increase in the piece rate paid for articles by a major chinese university the increased productivity comes exclusively from those who were already research active

the response of worker effort to piece rates we measure the elasticity of worker effort with respect to changes in the piece rate using panel data collected from the payroll records of a british columbia tree planting firm our data contain information on daily worker productivity and the piece rate received over a five month period using a structural model to control for the endogeneity of the piece rate we estimate this elasticity to be approximately 2 14 we also calculate a nonstructural lower bound to this elasticity equal to 0 77 structural estimation also allows us to perform policy experiments and to compare firm profits under alternative compensation systems our results suggest that profits would increase by at least 17 percent were the firm to implement the optimal static contract as predicted by principal agent theory this increase in profits would be due to capturing worker rents after the revelation of private information over ability yet only a negligible proportion of these rents could be captured while inducing workers to reveal ability truthfully suggesting that dynamic considerations were important in determining the firm s actual choice of contract

on stationarity and cointegration of international health expenditure and gdp this paper examines stationarity and cointegration of health expenditure and gdp for a sample of 21 oecd countries using data for the period 1960 1997 by applying a test battery that allows robust inference to be made on the stationarity and cointegration issue trend stationarity and no cointegration are tested using new country by country and panel tests not previously applied in this setting new results for country by country and panel tests of non stationarity and cointegration are presented our unit root and trend stationarity results indicate that both health expenditure and gdp are non stationary the no cointegration and cointegration results indicate that health expenditure and gdp are cointegrated

consumer demand for green power and energy efficiency abstract this article examines reported willingness to pay for electric utility investments in renewable energy and energy efficiency resources using the results of deliberative polls conducted by electric utilities in texas 1 age education and salary tend to affect reported willingness to pay for utility investments in these resources intensive exposure to information about energy resource issues led to an increase in the number of respondents interested in paying a modest premium to support investments in both renewable energy resources and energy efficiency however average reported premiums actually declined following the polls as very high outlier responses moved to more reasonable values following the polls these results support the contention that informed dialogue about energy alternatives will result in broader interest in providing a modest level of support for these resources

willingness to pay for renewable energy primary and discretionary choice of british households for micro generation technologies this paper documents the policy context of renewable energy production in the european union the research adopts a choice experiment approach to investigate households wtp for these renewable energy technologies in the uk the micro generation technologies comprise solar photovoltaic micro wind solar thermal heat pumps and biomass boilers and pellet stoves the study compares the results from conditional and mixed logit models which estimate the distribution of utility coefficients and then derives wtp values as a ratio of the attribute coefficient to the price coefficient with a model in which the wtp distribution is estimated directly from utility in the money space the results suggest that whilst renewable energy adoption is significantly valued by households this value is not sufficiently large for the vast majority of households to cover the higher capital costs of micro generation energy technologies

the response of worker effort to piece rates evidence from the midwest logging industry using firm level payroll data from the midwest logging industry i compute a worker s productivity response to a change in piece rate pay an elasticity of effort using an empirical specification developed in paarsch and shearer 1999 maximum likelihood estimation of an agency based structural econometric model of worker choice yields elasticities ranging from 0 413 to 1 507 these estimates are smaller than but qualitatively similar to those reported in paarsch and shearer suggesting that their model has perhaps more general applicability than their british columbia tree planting example

reputation and imperfect information abstract a common observation in the informal literature of economics and elsewhere is that is multistage games players may seek early in the game to acquire a reputation for being tough or benevolent or something else but this phenomenon is not observed in some formal game theoretic analyses of finite games such as selten s finitely repeated chain store game or in the finitely repeated prisoners dilemma we reexamine selten s model adding to it a small amount of imperfect or incomplete information about players payoffs and we find that this addition is sufficient to give rise to the reputation effect that one intuitively expects

renewables portfolio individual preferences and social values towards res technologies abstract the massive deployment of renewable energy sources represents a high priority for greece in order to comply with the directive 2009 28 ec on the promotion of the use of energy from renewable sources by 2020 in this perspective aegean islands especially lesvos are endowed with a considerable potential of a portfolio of renewables a fact that the entrepreneurial interest has already been targeted however regulatory attempts for a massive penetration of renewables do not take seriously into account preferences and risk perceptions of local communities where the proposed projects are to be installed the aim of this study is to investigate individual preferences and social values towards specific technologies of renewables in lesvos island we apply an open ended contingent valuation survey in order to analyze factors shaping public attitudes towards a portfolio of renewable technologies and estimate the economic welfare willingness to pay of the preferred technologies we argue that such information is relevant for energy policy design and the establishment of effective measures for the promotion of renewable energy sources

bailing out expectations and public health expenditure we use a natural experiment the fiscal adjustment of italy in the 1990s to meet the maastricht criteria to test a simple model of soft budget constraint that closely resembles the intergovernmental relationships in the italian public health care sector we show that the link between the ex ante financing by the central government and the health expenditure by regions was stronger when regional expectations of future bailing outs were presumably lower confirming previous research we also prove that more fiscally autonomous regions were more financially responsible and that a political alignment effect was present with friendly regional governments controlling more expenditure than unfriendly ones our results suggest that at least in italy bailing out expectations by regions may be the missing variable emphasised by culyer a j 1988 health care expenditures in canada myth and reality canadian tax papers 82 for empirical models explaining health expenditure our results also raise some worries about the outcome of the current decentralization process in europe

the role of sales agents in information disclosure evidence from a field experiment with a large nationwide retailer we run a natural field experiment to measure the effects of energy use information disclosure customer rebates and sales agent incentives on demand for energy efficient durable goods although a combination of large rebates plus sales incentives substantially increases market share information and sales incentives alone each have zero statistical effect and explain at most a small fraction of the low baseline market share sales agents strategically comply only partially with the experiment targeting information to more interested consumers but not discussing energy efficiency with the disinterested majority these results suggest that seller provided information is not a major barrier to energy efficiency investments at current prices in this context data as supplemental material are available at http dx doi org 10 1287 mnsc 2015 2327 this paper was accepted by john list behavioral economics

do professionals choke under pressure high rewards or the threat of severe punishment provide strong motivation but also create psychological pressure which might induce performance decrements by analyzing the performance of professional football players in penalty kick situations the paper provides empirical evidence for the existence of detrimental incentive effects two pressure variables are considered in particular 1 the importance of success and 2 the presence of spectators there are plenty of situations in which pressure arises in the workplace knowing how individuals perform under pressure conditions is crucial because it has implications for the design of the workplace and the design of incentive schemes

the existence of self enforcing implicit contracts implicit contracts are nontrivial nash equilibria to the post hiring trading game between a worker and the employer these are supported by intrafirm rather than labor market reputations the existence of an implicit contract that supports efficient trade is proved in a simple model

gift giving and worker productivity evidence from a firm level experiment abstract we present results from a field experiment designed to measure worker response to a monetary gift from their employer the experiment took place inside a tree planting firm paying its workforce incentive contracts firm managers told a crew of tree planters they would receive a pay raise for one day as a result of a surplus not attributable to past planting productivity we compare planter productivity the number of trees planted per day on the day the gift was handed out with productivity on previous and subsequent days of planting on the same block and thus under similar planting conditions we find direct evidence that the gift had a significant and positive effect on daily planter productivity controlling for planter fixed effects weather conditions and other random daily shocks

piece rates fixed wages and incentives evidence from a field experiment data from a field experiment are used to estimate the gain in productivity that is realized when workers are paid piece rates rather than fixed wages the experiment was conducted within a tree planting firm and provides daily observations on individual worker productivity under both compensation systems unrestricted statistical methods estimate the productivity gain to be 20 since planting conditions potentially affect incentives structural econometric methods are used to generalize the experimental results to out of sample conditions the structural results suggest that the average productivity gain outside of the experimental conditions would be at least 21 7

the incentive effects of tournaments revisited evidence from the european pga tour this analysis of data from the 1987 european men s professional golf association pga tour strongly supports the hypothesis that the level and structure of prizes in pga tournaments influence players performance specifically players performance appears to vary positively with both the total money prizes awarded in a tournament and the marginal return to effort in the final round of play a value that varies among players largely depending on how the prize money is allocated among finishers of different ranks the authors suggest that these results together with the similar results of their earlier study of the 1984 u s men s pga tour may have implications for the design of compensation systems for certain groups of workers such as corporate executives college professors and salespeople

equilibrium wage and dismissal processes i develop and estimate an equilibrium model of the labor market in which inefficient employees are systematically eliminated from the sector of the market characterized by asymmetric information and moral hazard systematic selection on the distribution of productivity characteristics produces wage sequences that are increasing in tenure for employees never previously terminated even in the absence of long term contracting between employees and individual firms i provide sufficient conditions for there to exist a unique termination contract type of equilibrium and i estimate the equilibrium model using microlevel data from the national longitudinal survey of youth panel

recent theoretical work on the soft budget constraint the soft budget constraint is a syndrome that was identified and studied by janos kornai in his analysis of centrally planned economies see kornai 1980 the syndrome is said to arise when a seemingly unprofitable enterprise is bailed out by the government or the enterprise s creditors in other words the enterprise is not held to a fixed budget but finds its budget constraint softened by the infusion of additional credit when it is on the verge of failure kornai viewed the soft budget constraint as a crucial ingredient for explaining the salient features of socialist economic performance in particular the pervasiveness of shortages one interesting puzzle is why centrally planned economies have been particularly susceptible to the influence of the soft budget constraint the capitalist world is hardly immune as the recent financial crisis in asia attests but on the whole it has proved less vulnerable indeed the very origin of the soft budget constraint and the mechanism by which it gives rise to shortages and other undesirable effects are also obviously important questions although kornai s work has long been well known and appreciated answers to these associated theoretical questions have been hazarded only recently in maskin 1996 i surveyed some of the initial efforts in this direction including mathias dewatripont and maskin 1995 which argues that centralization of credit can give rise to soft budget constraints because it facilitates the refinancing of

the suite smell of success personnel practices and firm performance the authors use a panel of more than 1 500 new zealand firms from a diverse range of industries to examine how the adoption of human resource management hrm practices affects firm performance the panel is based on managerial responses to mandatory surveys of management practices in 2001 and 2005 administered by the national statistical office linked to objective longitudinal firm performance data the authors find that after controlling for time invariant firm characteristics and changes in a wide range of business practices and firm developments a suite of general hrm practices has a positive impact on firm labor and multifactor productivity conversely these practices tend to have no effect on profitability in part because the adoption of performance pay systems raises average wages in the firm

green investment scheme experience and results in the czech republic abstract the key goal of this study was to analyse application of the green investment scheme in the czech republic through the green savings programme finalising in 2015 the programme was evaluated in terms of aspects of both reduction effectiveness and economic aspects of the basic subsidy categories a insulation b low energy houses c biomass boilers d solar thermal systems and e heat pumps the essential results of the programme were also covered including the number of projects supported the total volume of emission reduction and the volume of financial funding the basic evaluation was based on selected indicators including abatement costs greening ratio payback period and subsidy share of investment costs the primary data for calculating originated from the database of the information system of the green savings programme by the state environmental fund of the czech republic the calculated value of abatement cost was between 12 heat pumps and biomass boilers and 272 t co 2 1 low energy houses the shortest payback time periods were calculated for insulation at 11 2 and 3 8 years respectively without and including the provided subsidy on the contrary there was no economic payback in the case of biomass boilers due to transition to an economically costlier fuel

salaries or piece rates on the endogenous matching of harvest workers and crops the objective of this paper is to determine whether the choice of payment schemes hourly vs piece rates is systematically related to the workers risk aversion and ability we derive the equilibrium relationship between agents risk aversion and ability and the power of incentives payment scheme in a market where many heterogeneous principals and agents are endogenously matched the equilibrium matching between principals and agents depends on the traits and is critical in determining the contract choice using confidential data from the national agricultural workers survey naws we find evidence of matching between agricultural workers and the riskiness of their jobs crops they harvest based on workers risk aversion and no matching based on ability when controlling for matching we find strong evidence that high risk averse workers choose hourly rates and low risk averse workers choose piece rates we also found that high ability types choose piece rates and low ability types choose hourly rates but the evidence is weaker jel j33 d82 q12

understanding the soft budget constraint we propose a clarification of the notion of a soft budget constraint a concept widely used in the analysis of socialist transitional and market economies our interpretation is broad enough to embrace most existing approaches to soft budget constraint phenomena and provides a classification of their causes and consequences in light of this interpretation we then review the theoretical literature on the subject and compare it with those on other dynamic commitment problems in economics

the provision of incentives in firms i ncentives are the essence of economics despite many wide ranging claims about their supposed importance there has been little empirical assessment of incentive provision for workers the purpose of this paper is to critically overview existing work on the provision of incentives since the interests of workers and their employers are not always aligned a large theoretical literature has emphasized how firms design compensation contracts to induce employees to operate in the firm s interest this literature has reached into many areas of compensation and has pointed to a multitude of different mechanisms that can be used to induce workers to act in the interests of their employers these include piece rates options discretionary bonuses promotions profit sharing efficiency wages deferred compensation and so on my objective here is to evaluate this literature in the light of a growing empirical literature on compensation where possible i will address the literature from two perspectives first an underlying assumption of this literature is that individuals respond to contracts that reward performance accordingly i consider whether agents behave in this way and whether these responses are always in the firm s interest second i address whether firms write contracts with these responses in mind in other words do contracts look like the predictions of the theory incentives are provided to workers

us consumers willingness to pay for green electricity abstract we analyze us consumers demand for environmental attributes of deregulated residential electricity services using results from a survey designed to elicit consumers willingness to pay for such attributes and using results from a hedonic analysis of actual price premiums charged for green electricity in several deregulated markets survey results suggest that many population segments are willing to pay for decreased air emissions even if there is no alteration in fuel source furthermore several groups are willing to pay significantly more when emissions reductions stem from increased reliance upon renewable fuels the hedonic analysis suggests that several product features not considered in the survey help explain real price premiums including fuel mix from newly created renewable generation capacity green e certification brand name and state of offer while survey and hedonic results are not easily compared due to limitations of the survey both point to similar values for key environmental attributes though the survey results are likely to overstate actual willingness to pay in sum the results suggest that consumer driven purchases can in part support the future of renewable generation capacity in the united states though reliance upon other policy alternatives may be needed if energy prices spike

gender differences in motivational crowding out of work performance this paper shows that prior financial incentives induce a crowding out effect when incentives are discontinued in our real effort experiment workers receive a piece rate before monetary incentives are substituted by a one time payment in this case workers performance significantly drops when receiving the one time payment the effect is driven by a fraction of men who reduce effort substantially whereas women constantly perform well we find that this motivational crowding out effect disappears when men do not have prior experience of a piece rate in a series of control treatments we discard several alternative explanations besides motivational crowding out jel c91 j16 m54

playing for keeps pay and performance in the nba i introduction a basic insight of agency theory is that properly designed incentive contracts can align the interests of agents with those of the principal and recent empirical work shows that workers do indeed respond to financial incentives 1 contractual incentives however are not the only force motivating workers workers also have incentives to vary effort at different points of their contract cycle to increase effort just before a new contract is signed to lock in a more lucrative deal and then reduce it after a multi year contract is secured these types of contract related incentives create clear moral hazard problems but have received little empirical attention the motivating hypothesis in this paper is that imperfect information and multi year contracts create an implicit incentive for workers to strategically alter effort over the contract cycle in the year prior to signing the contract their contract year workers may exert above average effort to convince employers that they are high quality and thus raise long term compensation once the contract is signed however workers may exert less effort because wages are effectively independent of contemporaneous performance an empirical difficulty is that this moral hazard may be obscured by two factors a selection effect may lead only high quality workers to receive contracts and career concerns may provide additional incentives and dampen the post contract decline 2 this paper employs a unique dataset for professional basketball players in the national basketball association nba from 1988 to 2002 to examine the contract related incentive effects the data include contract information year signed length of contract and value of contract for every active player in 2000 and performance measures points scored rebounds assists etc throughout each player s career contract related incentive effects are estimated from changes in individual performance over the contract cycle if performance systematically improves just before signing a new contract and falls afterward some of the fluctuation is likely due to contract related incentives i also examine the traditional link between pay and past performance which is necessary for these types of incentives to be relevant the critical advantage of this data is the detailed information on individual performance individual contract status and individual pay 3 in contrast previous work on individual incentives for example lazear 2000 paarsch and shearer 2000 and shearer 2004 studied changes infirmwide compensation plans while the empirical literature on executive pay and performance for example murphy 1985 1986 jensen and murphy 1990 gibbons and murphy 1992 kaplan 1994 and hall and liebman 1998 typically examined the link between individual pay and firm performance the individual level data constructed here have the critical variation across individuals which is needed to identify the impact of these contract related incentive effects the empirical work begins with a test of the link between pay and performance which is necessary for contract related incentives to be operational not surprisingly better performers in the nba are rewarded with higher salaries and longer contracts more relevant to the incentive issue players are strongly rewarded for improvements in performance in their contract year a one point increase in a player s scoring average for example is associated with an annual salary increase of over 300 000 this link provides the crucial motivation for the hypothesis that players will exert additional effort in their contract year to lock in the better contracts that they expect to follow the data then provide strong evidence of contract related incentive effects as overall performance does in fact improve relative to a player s long run average in the contract year and then declines after a long run contract is signed

federalism fiscal restraints and european monetary union a prominent feature of the maastricht treaty on european union is the restrictions it places on fiscal policy under the provisions of the excessive deficit procedure or edp the success of member states in avoiding excessive deficits during the transition to economic and monetary union emu is one of four criteria governing admission to the monetary union once monetary union has begun member states are unconditionally required to avoid excessive deficits a state has an excessive deficit when it is so declared by the european council upon a report by the european commission and a judgment by the monetary committee the edp is set in motion if a country s deficit and general government debt respectively exceed 3 percent and 60 percent of gdp the justification for these procedures is that member states participating in the monetary union must be restrained from overborrowing to avoid destabilizing the common currency if excessive deficits cause a debt crisis the european central bank ecb will come under pressure to bail out the imperiled government the bailout could be ex post in which case the ecb would monetize the government s debt or ex ante in which case it would keep interest rates low to lighten the debt service burden either way unfettered fiscal policies could create inflationary pressures that the ecb will find difficult to resist

distribution of transfers and soft budget spending behaviors evidence from italian regions this paper examines empirically the strategic interactions among central and subcentral governments when incomplete information forces the subcentral government to form expectations about the amount of transfers that it will receive from the central one the empirical analysis features a wide array of proxies for transfer expectations and uses an autoregressive modeling technique to estimate them on a sample of 20 italian regions for the 1995 2009 time interval the analysis shows that transfer expectations are a quantitatively important component of local government spending revealing evidence of soft budget spending behavior

piece rates fixed wages and incentive effects statistical evidence from payroll records we develop and estimate an agency model of worker behavior under piece rates and fixed wages the model implies optimal decision rules for the firm s choice of a compensation system as a function of working conditions our model also implies an upper and lower bound to the incentive effect the productivity gain realized by paying workers piece rates rather than fixed wages that can be estimated using regression methods using daily productivity data collected from the payroll records of a british columbia tree planting firm we estimate these bounds to be an 8 8 and a 60 4 percent increase in productivity structural estimation which accounts for the firm s optimal choice of a compensation system suggests that incentives caused a 22 6 percent increase in productivity however only part of this increase represents valuable output because workers respond to incentives in part by reducing quality

piece rates principal agent models and productivity profiles parametric and semi parametric evidence from payroll records this paper uses data on the wages received by piece rate workers to estimate worker productivity profiles the data were collected from the payroll records of a british columbia copper mine the advantage of these data is the close link between observed wages and worker productivity an explicit model is used to control for worker effort as a function of observable worker characteristics and the parameters of the compensation system the model implies a censored wage distribution the parameters of which can be estimated using well known econometric techniques semi parametric estimation allows for the relaxation of the distributional assumptions of the model results suggest that while productivity profiles were increasing concave functions of tenure they were also very flat i relate these results to historical arguments on the skill saving nature of technological change in the mining industry at the end of the nineteenth century

the regional impact of health care expenditure the case of italy decentralization invests the subcentral authorities of a country with autonomy in political and economic power the exercise of which may widen interregional divergence and inequality this paper provides evidence demonstrating that in the case of italy the central government s policies for rationalization and containment of the growth of health care expenditure in combination with decentralization in the administration and provision of health care have resulted in interregional inequality aggravating the existing regional divergence

decentralization as a constraint to leviathan a panel cointegration analysis this paper extends the empirical literature about the effects of fiscal decentralization on the growth of government along three dimensions it distinguishes between the effects of the level of decentralization from the way local governments finance their expenditures common pool versus own resources it uses a panel cointegration approach to separate the long run effects of decentralization from the short run dynamics and it extends and revises the datasets generally used in these empirical analyses the results show that the amount of revenue raised by sub national governments leads to a long term fall in the size of government but grants have the opposite effect in addition a greater decentralization of expenditure leads to greater overall spending when the short term is considered these influences work slowly as the speed of adjustment towards the desired government size is relatively sluggish in addition in the short run there is also a clear effect from the role of local revenue raising powers that stimulates the growth of government these results appear robust to changes in the composition of the variables countries and periods included the sample

evidence on incentive effects of subjective performance evaluations the authors investigate the effect of managerial performance evaluation styles on employee work effort using panel data on 4 080 employees in a swiss unit of an international company for the period 1999 2002 they test two hypotheses using paid and unpaid overtime work as effort indicators the company applies two performance based remuneration mechanisms an individual surprise bonus and one in which salary is affected by the extent to which an individual has reached personalized targets the authors hypothesize that effort is higher in departments in which individual performance evaluations are more flexible over time as well as when surprise bonuses are used more frequently both hypotheses are supported and the estimated effects are substantial increases in rating flexibility or bonus payments by one standard deviation above the mean increase average overtime hours by more than 20 the findings are robust and suggest that surprise bonuses and flexible performance evaluations over time provide ef

evidence on the determinants of canadian provincial government health expenditures 1965 1991 abstract real per capita provincial government expenditures on health care over the period 1965 1991 are examined using pooled time series cross section regression analysis key determinants of real per capita provincial government expenditures on health care over the period 1965 1991 are real provincial per capita income the proportion of the provincial population over age 65 and real provincial per capita federal transfer revenues established program financing had a negative and significant impact on real per capita provincial government health expenditures in newfoundland and quebec an income elasticity of 0 77 implies that health care is not a luxury good

introduction do compensation policies matter excerpt the papers in this volume should give the reader a sense of the exciting empirical research that has recently taken place on compensation related issues as a set these papers considerably expand our empirical evidence on the effects of compensation policies several papers show that executive compensation is structured in a way that at least implicitly ties executive compensation changes to measures of corporate performance and crucially that doing so leads to improved corporate performance leonard murphy gibbons abowd others show that compensation systems that pay workers for performance in the sense of providing explicit or implicit incentives for high levels of performance can motivate individuals to increase their effort levels ehrenberg bognanno hamermesh asch kahn sherer still others show that high wage policies do have some of the effects that proponents of efficiency wage theories claim for them krueger groshen holzer finally one shows that profit sharing plans appear at least weakly to increase employment stability chelius smith

electoral goals and center state transfers a theoretical model and empirical evidence from india we construct a model of redistributive politics where the central government is opportunistic and uses its discretion to make transfers to state governments on the basis of political considerations these considerations are the alignment between the incumbent parties at the central and state levels and whether a state is a swing state or not a testable prediction from the model is that a state that is both swing and aligned with the central government is especially likely to receive higher transfers we test this prediction using indian data for 14 states from 1974 75 to 1996 97 we find that a state which is both aligned and swing in the last state election is estimated to receive 16 higher transfers than a state which is unaligned and non swing

field experiments in the developed world an introduction field experiments represent a relatively new area in economics to understand the causal links from one variable to another they have been used by academics to help answer interesting and policy relevant questions in the developed world relating to educational attainment tax avoidance consumer finance negative externalities charitable giving and labour market contracts in this paper we bring together the key ideas behind the different variants of field experiments how field experiments have been used to test theory their limitations and the new areas currently being opened up by field experiments

beyond the fiction of federalism macroeconomic management in multitiered systems recent research on federalism is extremely divided while some tout the benefits of market preserving federalism others point to the fragmentation and incoherence of policy in federal states this research bridges the divide by analyzing the political and fiscal structures that are likely to account for the highly divergent economic experiences of federal systems around the world to test these propositions the authors use an original data set to conduct analyses of budget balance and inflation in fifteen federations around the world from 1978 through 1996 the empirical research suggests that the level of fiscal decentralization the nature of intergovernmental finance and vertical partisan relations all influence macroeconomic outcomes the findings have broad implications for the widespread move toward greater decentralization and for the theoretical literatures on federalism and macroeconomics

valuation for renewable energy a comparative review abstract environmental cost benefit analysis is applied for the evaluation of renewable energy projects since some benefits and costs do not have monetary values economic valuation techniques are applied to estimate them this paper reviews the literature on the valuation evaluation of renewable energy resources and summarizes the methods used in them it discerns four main streams of valuation in renewable energy the first is economic welfare oriented and comprises stated and revealed preference methods the second is the financial option analysis with a financial background the third is emergy analysis which is mostly an ecological engineering based method with capable economic links and the fourth is again economic but not welfare based the paper discusses the main directions discerned in these studies and recognizes first that proper valuation takes place only in the first method while the other methods describe only evaluation procedures and second that there is a research gap that has yet to be filled in as compared to other areas of environmental resource and energy economics

on the relevance and composition of gifts within the firm evidence from field experiments we investigate the economic relevance and the composition of gifts within a firm where output is contractible we develop a structural behavioral model that identifies workers optimal reaction to monetary gifts received from their employer we estimate the model using data from two separate field experiments conducted within a tree planting firm we use the estimated structural parameters to generalize beyond the experiment simulating how workers would react to different gifts on the part of the firm within different labor market settings we find that gifts have a role to play within this firm increasing in importance when the workers outside alternatives deteriorate profit maximizing gifts would increase profits within slack labor markets by up to 10 on average and by up to 17 for certain types of workers

a survey of energy policy priorities in the united states energy supply security economics and the environment security environment and economic concerns are commonly identified as three major objectives of energy policy state and federal governments have set aggressive targets for carbon emissions reductions and for alternative fuel use and increased vehicle efficiency to reduce petroleum consumption moreover jobs creation and gdp growth are often cited as key drivers for energy policies previous studies on energy policy decision making have examined the process for developing and evaluating options using multi criteria decision analysis tools in addition energy opinion polls have either elicited preferences between two goals or whether the public supports a specific policy action in this article we report results from a survey of 884 members of professional membership organizations on how the u s should prioritize energy policy across the goals of energy supply security environment and climate and economics and job creation the majority favor policymaking that is balanced across all three security and economic concerns increase with age for male respondents whereas environment is the highest priority for females regardless of age unlike previous surveys that target the general public and focus on a particular objective or technology these results provide an example of eliciting a portfolio allocation across multiple energy policy goals from targeted constituents

implicit contracts incentive compatibility and involuntary unemployment this paper considers the enforceability of employment contracts when employees performance cannot be verified in court so that piece rate contracts are not legally enforceable part i shows that there exists a variety of self enforcing implicit contracts modelled as perfect equilibria in a repeated game and characterizes all the wage and performance outcomes that can be implemented implementation requires a strictly positive surplus from employment the form of the contract depending on how this surplus is divided between firm and employee piece rate contracts and contracts with an informally agreed bonus can be made self enforcing but the use of severance pay and bonding does not extend the set of implementable allocations the resulting contracts resemble actual labor contracts more than do the contracts in standard principal agent models part ii analyses market equilibrium with these contracts also modelled as perfect equilibria in a repeated game and shows that many such equilibria exist unfilled vacancies and unemployed workers can co exist despite the existence of contracts that are potentially mutually beneficial for those jobs that are filled any division of the potential surplus is possible so that the market can have at the same time involuntary unemployment and vacancies that are unfilled despite filled jobs earning positive profits as a criterion for selecting equilibria a notion of renegotiation proofness is applied then either all workers are employed or all jobs filled but any division of the potential surplus is still possible the paper explores what further restrictions on beliefs give rise to a walrasian outcome in which all the potential surplus goes to the short side of the market and to an efficiency wage type outcome in which the potential surplus goes to the long side

regulatory focus regulatory fit and the search and consideration of choice alternatives this research investigates the effects of regulatory focus on alternative search and consideration set formation in consumer decision making results from three experiments yield two primary findings first promotion focused consumers tend to search for alternatives at a more global level whereas prevention focused consumers tend to search for alternatives at a more local level second promotion focused consumers tend to have larger consideration sets than do prevention focused consumers building on these two primary findings it is additionally shown that whereas promotion focused consumers attach relatively greater value to options chosen from hierarchically structured sets prevention focused consumers attach relatively greater value to options chosen from nonhierarchically structured item lists finally whereas promotion focused consumers attach significantly greater value to options chosen from larger sets than to options chosen from smaller sets prevention focused consumers do not attach significantly less value to options chosen from larger sets than to options chosen from smaller sets

what makes people seal the green power deal customer segmentation based on choice experiment in germany abstract consumers have the power to contribute to creating a more sustainable future by subscribing to green electricity tariffs in order to reach consumers beyond the eco niche identifying the drivers that positively influence the adoption of green electricity is of fundamental importance this paper examines various factors that help to explain the extent to which green electricity subscribers differ from those that display strong preferences towards green electricity but have not yet walked the talk by making use of a latent class segmentation analysis based on choice based conjoint data this paper identifies three groups of potential green electricity adopters with varying degrees of preference for renewable energy findings indicate that socio demographic factors play a marginal role in explaining the differences between green electricity subscribers and potential adopters with the exception that actual adopters tend to be better educated analysis of psychographic and behavioral features reveals that adopters tend to perceive consumer effectiveness to be higher place more trust in science tend to estimate lower prices for green electricity tariffs are willing to pay significantly more for other eco friendly products and are more likely to have recently changed their electricity contract than non adopters policy recommendations associated with these findings are provided

citizens preferences on nuclear and renewable energy sources evidence from turkey abstract based on data from a face to face survey of 2422 residents from urban turkey this paper presents an analysis of citizens preferences in turkey on nuclear and renewable energy sources findings indicate that opposition to nuclear power was strong and only a small number of respondents endorsed it by listing it in their top two choices conversely almost two thirds of the sample endorsed investment in renewable energy sources such as wind and solar and only a small minority was opposed to it econometric analyses revealed that knowledge of the climate change problem was a common factor that explained endorsement of both nuclear and renewables yet high levels of concern for the environment and a negative perception regarding its future differentiated the endorsers of renewables from those of nuclear energy endorsers of nuclear energy were found to be males who were knowledgeable about climate change and engaged in environmental issues but less concerned about the environment and optimistic about its future nuclear opponents on the other hand were found to be concerned about the environment pessimistic about its future and not fully relying on technology