single period multiproduct inventory models with substitution we study a single period multiproduct inventory problem with substitution and proportional costs and revenues we consider n products and n demand classes with full downward substitution i e excess demand for class i can be satisfied using product j for i j we first discuss a two stage profit maximization formulation for the multiproduct substitution problem we show that a greedy allocation policy is optimal we use this to write the expected profits and its first partials explicitly this in turn enables us to prove additional properties of the profit function and several interesting properties of the optimal solution in a limited computational study using two products we illustrate the benefits of solving for the optimal quantities when substitution is considered at the ordering stage over similar computations without considering substitution while ordering specifically we show that the benefits are higher with high demand variability low substitution cost low profit margins or low price to cost ratio high salvage values and similarity of products in terms of prices and costs

china s balance of emissions embodied in trade approaches to measurement and allocating international responsibility international trade is characterized not only by the flow of capital and goods but also by the energy and emissions embodied in goods during their production this paper investigates the evolving role that chinese trade is playing in the response to climate change by estimating the scale of emissions embodied in china s current trade pattern and demonstrating the magnitude of the difference between the emissions it produces some of which are incurred to meet the consumption demands of the rest of the world and the emissions embodied in the goods it consumes estimating china s emissions on a consumption rather than a production basis both lowers its responsibility for carbon dioxide co2 emissions in 2006 from 5 500 to 3 840mtco2 and reduces the growth rate of emissions from an average of 12 5 per cent p a to 8 7 per cent p a between 2001 and 2006 the analysis indicates that a reliable consumption based accounting methodology is feasible and could improve our understanding of which actors and states are responsible for emissions for example recent emissions reductions by developed countries may lack credibility if production has merely been displaced to countries such as china moreover in the current institutional context production methodologies encourage leakages through trade that may do more to displace than to reduce emissions both equity and efficiency concerns therefore suggest that emissions embodied in trade should receive special attention in the distribution of post kyoto abatement burdens

scale economies in factor supplies international trade and migration this paper incorporates externalities generated by human capital into the heckscher ohlin samuelson framework to examine the patterns of international trade and migration individuals endowed with different levels of human capital choose to become either unskilled or skilled workers national scale economies with respect to human capital play an important role in endogenously determining these factor supplies and yield a number of interesting patterns of trade and migration migration could reinforce comparative advantage both skilled and unskilled workers could migrate in the same direction

a two item newsboy problem with substitutability previous research on the newsboy problem is based on the assumption that in case of a shortage unsatisfied demand is lost such an assumption is inappropriate for items that have a close substitute in this paper we formulate a two item newsboy problem with substitutability tinps upper and lower bounds on the optimal order quantities of the two items are derived since analytical solutions to the problem are difficult to obtain a monte carlo simulation is used to identify the optimal solution to the tinps order quantities identified by the simulation provide higher expected profit than would have been obtainable without considering substitutability

a gravity model analysis of international migration to north america this study examines the influence of political economic and demographic factors on the size and composition of migration flows to north america a modified gravity model is specified and adjusted to include immigration regulations and characteristics specific to the origin and destination countries for empirical test of the model the time period of study is from 1976 1986 and 70 countries are covered for a total of 1540 observations of migration flows to canada and the usa the results reveal that the population of origin countries and the income of destination countries are two major determinants of migration to north america high population areas of asia and latin america provided a large share of the immigrants domestic restrictions on political and civil freedom in origin countries are found to significantly impair migration to north america

the effects of selling packaged goods on inventory decisions in this paper we study within a newsboy type modeling framework the common business practice of retail firms to sell products not only as independent items but also as part of multiproduct packets packaged goods our emphasis is on understanding the effects of such practices on the inventory decisions of the firm we provide insights on the resulting level of suboptimality when inventory decisions are made with demand information only on the independent items and without accounting for the demand substitution structure induced between independent items and packaged goods our stylized model studies an environment with two products that are not direct substitutes for each other sold either independently or as part of a packet that contains one unit of each we provide necessary and sufficient optimality conditions for this model and suggest an efficient numerical search for obtaining the optimal stocking levels an extensive computational study allowed us to provide insights on the nature of the optimal stocking policies the suboptimality of independent newsboy policies the effects of demand correlation among individual products and multiproduct packets and the determining role of induced substitution structure among products during stockout occasions on the profitability of the inventory system

immigrant participation in the welfare system this paper presents a systematic analysis of immigrant participation in the us welfare system using the 1970 and 1980 us censuses in contrast to the previous studies the researchers focused on changes in welfare use across immigrant cohorts over time for a single immigrant cohort as it assimilates to the us furthermore it develops a theoretical model of the migration decision that explicitly incorporates the income insurance aspect of the us welfare system the analysis revealed that recent immigrant cohorts use the welfare system more intensively than earlier immigrant waves also the immigrant welfare participation was greater the longer an immigrant household had resided in the us and those characteristics of the immigrants country of origin were important determinants of welfare participation in addition the theoretical model of the migration decision which explicitly incorporated the presence of a welfare system in the destination country and this model could account for some of the ways in which source country characteristics were found to affect immigrant welfare participation

how much climate policy has cost for oecd countries abstract high economic cost of climate policy has attracted critical debate since the kyoto protocol however reliable empirical evidence of the abatement cost of green house gases across countries remains scant in this study we estimate the average yearly green house gas abatement costs per capita for a panel of 28 oecd countries in years 1990 2015 the marginal abatement costs are estimated using a novel data driven approach based on convex quantile regression compared to traditional frontier estimation methods the quantile approach takes into account a broader set of abatement options and is more robust to inefficiency noise and heteroscedasticity in empirical data the comparison of oecd countries shows that the actual abatement cost per capita has been very modest much lower than predicted in the late 1990s this result has profound policy implications calling for more ambitious climate change mitigation strategy in the future

undocumented immigration and income inequality in the native born population of the us econometric evidence according to the theoretical models suggested by chiswick and others the growing presence of undocumented immigrants in the us should have a disequalizing effect on income distribution in the native born population however this proposition has not been subjected to empirical test here an econometric model of income inequality in native born households is constructed and census based estimates of the state distribution of undocumented immigrants are used to estimate model parameters the results show that such immigration has been disequalizing but that the impact has been small ranking behind several other socio economic variables

the competitive newsboy we consider a competitive version of the classical newsboy problem in which a firm must choose an inventory or production level for a perishable good with random demand and the optimal solution is a fractile of the demand distribution and investigate the impact of competition upon industry inventory a splitting rule specifies how initial industry demand is allocated among competing firms and how any excess demand is allocated among firms with remaining inventory we examine the relation between equilibrium inventory levels and the splitting rule and provide conditions under which there is a unique equilibrium our most general result is that if all excess demand is reallocated i e there is perfect substitutability then competition never leads to a decrease in industry inventory

the impact of immigration on the human capital of natives implications of the quantity number and quality skill of immigration on the destination economy are analyzed including impacts on value added wages quasi rents rates of return and the skill distribution of the native labor force quantity quality trade offs are considered for both immigrant and native workers medium and long run labor supply responses by natives to immigrant induced changes in wage rates are shown to have second order effects which substantively affect the impacts of immigrants the impact of immigration policy depends on the quality as well as quantity of immigrants the time horizon and the speed of factor market adjustment

war and pestilence as labor market shocks u s manufacturing wage growth 1914 1919 there is not a single expert machinist in the labor market today if such a one exists he will be able to command his own wages the arkansas gazette october 22 1918 1 i introduction the possibility of a worldwide influenza pandemic in the near future is of growing concern for many countries around the globe the world bank estimates that a global influenza pandemic would cost the world economy 800 kill tens of millions of people 2 researchers at the u s centers for disease control and prevention calculate that deaths in the united states could reach 207 000 and the initial cost to the economy could approach 166 billion or roughly 1 5 of gdp 3 the u s department of health and human services paints a more dire picture up to 1 9 million dead in the united states and initial economic costs near 200 billion 4 while researchers and public officials can only speculate on the likelihood of a global influenza pandemic many of the worst case scenario predictions for a current pandemic are based on the global influenza pandemic of 1918 this global pandemic often termed the spanish flu killed 675 000 people in the united states nearly 0 8 of the 1910 population and nearly 40 million people worldwide 5 only the black death of 13481351 is estimated to have killed more people roughly 60 million over a similar time period 6 the global magnitude and spread of the 1918 influenza pandemic was exacerbated by world war i which itself is estimated to have killed roughly 10 million civilians and 9 million troops nicolson 1980 not only did the mass movement of troops from around the world lead to the spread of the disease tens of thousands of allied and central power troops died as a result of the influenza rather than combat although combat deaths in world war i did increase the mortality rates for participating countries civilian mortality rates from the 1918 influenza were typically much higher for the united states estimates of combat related troop mortalities are about one tenth that of civilian mortalities from the 1918 influenza given the magnitudes and the concurrence of both the 1918 influenza pandemic and world war i one would expect volumes of research on the economic effects of each event although there does exist a significant literature on the economic consequences of world war i rockoff 2004 the scope of published research on the economic effects of the 1918 influenza pandemic is scant 8 most research that has been done has focused on the health and economic outcomes of decedents of pandemic survivors almond 2006 keyfits and flieger 1968 and mortality differences across socioeconomic classes mamelund 2006 noymer and garenne 2000 this paper contributes to the literature on the economic effects of the 1918 influenza pandemic and world war i by exploring the influence of mortalities from these concurrent events on the growth of manufacturing wages in u s states and cities over the period 1914 1919 9 the general conceptual foundation for the paper is that ceteris paribus both of these events resulted in a large number of deaths which constituted a significant negative shock to manufacturing labor supply and thereby would have increased wages in the manufacturing sector immediately following both events a similar conceptual framework has been used in studies that explored the economic effects of the black death campbell 1997 karakacili 2004 and the effects of immigration on labor markets borjas 1987 card 1990 greenwood and mcdowell 1986 the analysis presented here is the first to separate the potential manufacturing labor market effects of world war i and the 1918 influenza this is an interesting exercise given that mortalities from the 1918 influenza were nearly ten times greater than world war i combat mortalities but world war i combat mortalities were more likely men aged roughly 18 44 prime ages for manufacturing workers

social security and migration with endogenous skill upgrading abstract the aim of the paper is to investigate the joint redistributive effects of migration and pensions and to reassess the sustainability issue raised in the existing economic literature the paper first develops a theoretical framework to analyse the impact of international migration on the labour market the model allows for heterogeneity across native born individuals and for migrants to affect both the wages and the education decision in the recipient country it then explicitly focuses on pensions under alternative migration scenarios the analysis shows that migration causes redistributive effects which increase across group wage inequality however the endogenous educational response by residents partially offsets the redistributive impact of migration while creating additional interest groups migration helps the financial sustainability of the pension scheme but the interaction between migration and pensions causes complex inter and intragenerational redistributive conflicts which are analysed in the paper

international factor movements in the presence of a fixed factor abstract to the basic model of international factor mobility is added a third immobile factor unlike the basic model the factor flows that result from a policy of free mobility are now uniquely determined additionally a large variety of privately optimal national policies is predicted each dependent upon the country s endowment pattern and the fiscal instruments available to it several of the predicted policies e g subsidies paid to migrant factors and simultaneous restrictions on the export of both factors are incompatible with the basic model

carbon pricing revenues could close infrastructure access gaps introducing a price on greenhouse gas emissions would not only contribute to reducing the risk of dangerous anthropogenic climate change but would also generate substantial public revenues some of these revenues could be used to cover investment needs for infrastructure providing access to water sanitation electricity telecommunications and transport in this way emission pricing could promote sustainable socio economic development by safeguarding the stability of natural systems which constitute the material basis of economies while at the same time providing public goods that are essential for human well being for a scenario that is consistent with limiting global warming to below 2 c we find that domestic carbon pricing without redistribution of revenues across countries has substantial potential to close existing access gaps for water sanitation electricity and telecommunication however for the majority of countries carbon pricing revenues would not be sufficient to pave all unpaved roads and for most countries in sub saharan africa they would be insufficient to provide universal access to all types of infrastructure except water if some fraction of the global revenues of carbon pricing is redistributed e g via the green climate fund more ambitious infrastructure access goals could be achieved in developing countries our paper also bears relevance for the design of climate finance mechanisms as it suggests that supporting carbon pricing policies instead of project based finance might not only permit cost efficient emission reductions but also leverage public revenues to promote human development goals

perfectly discriminatory policy towards international capital movements in a dynamic world a large country is able to affect its trading partners accumulation of capital and so it can alter future market conditions capital movements can be regulated by perfectly discriminatory policy to maximize the welfare of the large country by exploiting this link this policy implies that resource allocation is efficient along the optimal path in contrast to the use of perfectly discriminatory policy in a static world it is not always optimal for the large country to fully exploit its market power copyright 1989 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

a static approximation for dynamic demand substitution with applications in a competitive market we propose a static approximation of dynamic demand substitution behavior based on a fluid network model and a service inventory mapping this approximation greatly enhances our ability to analyze the interdependent inventory service price and product assortment decisions in noncompetitive and competitive scenarios with demand substitution we demonstrate that the approximation is well behaved and then apply it to two previously intractable applications first we study a price and service competition between single product retailers after establishing a unique pure strategy nash equilibrium we find that competition results in lower price higher demand and a higher level of inventory we also observe that the aggregate profit and inventory level increase to positive constants as the number of retailers goes to infinity second we study a duopolistic competition on price service and product assortment we establish a pure strategy nash equilibrium for the product assortment competition and identify a condition for uniqueness we find that competition on both price and product assortment results in lower price and less variety for each competitor but the total number of products and the aggregate inventory level in a duopoly market are both likely to be higher than in a monopolistic market

deterministic eoq with partial backordering and correlated demand caused by cross selling abstract there has been much work regarding the deterministic eoq with partial backordering the majority of these studies assume no correlation in sales so independent demands across items is applied in the models however it is generally recognized that cross selling effects between items often appear in real contexts thus incorporating such effects in the inventory model in the form of correlated demands makes it of more practical relevance in this paper the authors address a two item inventory system where the demand of a minor item is correlated to that of a major item because of cross selling we firstly present a two item eoq model with identical order cycles where the unmet demand of the major item can be partially backordered with lost sales whereas the demand of the minor item must be met without stockouts this model is further extended to fit a more practical case where the order cycle of the major item is an integer multiple of that of the minor item the optimal solutions of the two models as well as the inventory decision procedures are also developed comparative analysis on these two eoq models has been drawn in the computational study which presents some insights into the parameter effect on the optimal inventory policy

income inequality and international migration the purpose of this paper is to analyse the impact of international factor movements on the personal distribution of income in order to get clearcut results we use a simple model of trade and migration in which there are two traded goods and three factors for any given country one of the traded goods corresponds to exports and the other to imports the three factors include capital and two types of labour skilled and unskilled we focus mainly on the alternative results of international migration of the two types of labour the geographical focus is worldwide excerpt

diverging patterns with endogenous labor migration abstract the standard neoclassical model cannot explain persistent migration flows and lack of cross country convergence when capital and labor are mobile here we present a model where both phenomena may take place assuming increasing returns and perfect capital mobility the driving forces behind labor migration are the size and the composition of the workforce the size of the workforce produces divergence a larger workforce in one country implies higher wages the wage gap induces in migration and this makes the wage gap even larger in this case migration is only beneficial for the labor importing country the evolution in the composition of the workforce due to migration may have opposite effects in one case in migration keeps the wage of skilled workers high enough to induce people to qualify for skilled jobs this improves the composition of labor in the receiving country only and it makes divergence a likely outcome in another case labor migration keeps the relative wage of unskilled workers in the rich country high enough to induce all migrants to take unskilled jobs and reduce the skilled to unskilled ratio in that country then migration is beneficial to the country which was first exporting labor

the choice between international labour and capital mobility in a dynamic model of north south trade abstract in a dynamic model of trade between two regions producing different products and having dissimilar labour market structures the impact of movements of capital and labour is examined it is shown that mobility of either factor of production benefits the full employment solow type economy in contrast an inflow of capital is detrimental to a labour surplus lewis type economy while labour outflow is beneficial

revealing the political decision toward chinese carbon abatement based on equity and efficiency criteria abstract china s economic reform over the past 30 years has allowed the free market to drive economic development however government still plays a key role in the energy sector by allocating energy conservation and emissions abatement how does the government make an equity decision as a tradeoff to market efficiency this is an unanswered question the purpose of this paper is to illustrate the government s preference toward equity and efficiency using the provincial level co 2 intensity allocation data we investigate the political decision that the government made based on the equity and efficiency criteria we find that the equity index plays a more important role than the efficiency index in determining the co 2 intensity target in addition political factors such as social stability are found to be important factors

an equity assessment of introducing uncertain forest carbon sequestration in eu climate policy large emissions of greenhouse gases are expected to cause major environmental problems in the future european policy makers have therefore declared that they aim to implement cost efficient and fair policies to reduce carbon emissions the purpose of this paper is to assess whether the cost of the eu policies for 2020 can be reduced through the inclusion of carbon sequestration as an abatement option while equity is also improved the assessment is done by numerical calculations using a chance constrained partial equilibrium model of the eu emissions trading scheme and national effort sharing targets where forest sequestration is introduced as an uncertain abatement option fairness is evaluated by calculation of gini coefficients for six equity criteria to policy outcomes the estimated gini coefficients range between 0 11 and 0 32 for the current policy between 0 16 and 0 66 if sequestration is included and treated as certain and between 0 19 and 0 38 when uncertainty about sequestration is taken into account and policy makers wish to meet targets with at least 90 per cent probability the results show that fairness is reduced when sequestration is included and that the impact is larger when sequestration is treated as certain

geographical spread of global emissions within country inequalities are large and increasing abstract in spite of the extensive literature on greenhouse gas emission inequalities at the world wide level most of the evidence so far has been based on country level data however the within country dimension matters for both the implementation and the policy formation of climate policies as a preliminary step towards a better understanding of within country inequalities this paper measures their extent for the two major greenhouse gases co2 and ch4 over the 1970 2008 period using theil index decompositions we show that within country inequalities account for the bulk of global inequality and tend to increase over the sample period in contrast with diminishing between country inequalities including differences across sectors reveals that between sector inequalities matter more than between country inequalities and between sector inequalities become the dominant source of global inequality at the end of the sample period in the co2 case finally estimated social tensions arising from the disconnection between emissions and future damages turn out to be increasing as soon as within country disparities are taken into account these orders of magnitude should be kept in mind while discussing the efficiency and fairness of alternative paths in combating global warming

economic effects of immigrants on native and foreign born workers complementarity substitutability and other channels of influence the authors use standard metropolitan statistical area smsa data constructed from 1980 census microdata files and other sources to estimate a structural model of native foreign born labor demand and labor supply which distinguishes the effects upon real wages of each type of labor and on the employment of natives the authors specify econometrically estimate and simulate the structural model which incorporates not only a production structure channel through which immigrants influence area real wages and employment but also demand and native labor supply channels it is noted that while these are not the only channels through which immigrants may affect native workers the model nonetheless constitutes a step in the direction of a general equilibrium approach in the production structure channel immigrants and natives are found to be substitutes in production immigration lowers foreign born wage rates and leads to lower wages for natives the negative effects of the production channel usually are ameliorated through the demand channel further immigrants add to local demand through their earnings and potentially through non labor income while also lowering unit costs and local prices which enhances real incomes and potentially net exports and thus the demands for local output and area labor the author discusses findings of interest from the simulation results based upon an analysis of all areas

trade theory distribution of income and immigration this paper examines the impact of mass immigration utilizing the analytical framework of so called trade theory as such its emphasis is on general equilibrium effects and on the constraints imposed by the openness of the economy on such effects the analysis will center on the distributional impact of unskilled labor immigration excerpt

some economic determinants of third world professional immigration to the united states 1972 87 abstract we estimate reduced form equations for immigration to the united states by engineers natural and social scientists and physicians from 18 third world countries explanatory variables include income real gdp growth graduation in the united states and study in each country of origin additional explanatory variables are foreign student enrollment in the united states lagged immigration total immigration from each country and a dummy variable which accounts for implementation of restrictions on permanent visas in 1972 1973 results generally conform to expectations but differ across occupations and with model specification most income statistics are unexpected however and the strong correlation of us income with graduation in the united states suggests that there is a simultaneity problem in models which include income because immigration appears to respond to labor shortages in the united states and surpluses in countries of origin our results suggest that us immigration quotas have not prevented third world professionals from responding to economic incentives

on the macroeconomic and welfare effects of illegal immigration abstract this paper uses a dynamic general equilibrium model with labor market frictions to explore the economic consequences of illegal immigration in the baseline model native workers and illegal foreign workers compete for jobs in the same market but serve as imperfect substitutes in production the calibrated model generates a u shaped relationship between long run domestic consumption and the population share of illegal immigrants after taking into account both consumption and leisure i found that an increase in illegal immigration can generate significant welfare gains for the natives the baseline model is then extended to include heterogeneous workers in the domestic population

migration of professionals from fiji to new zealand a reduced form supply demand model abstract in this study we estimate a reduced form equation for migration of highly skilled and professionally trained workers from fiji to new zealand during 1987 1990 explanatory variables include previous period s migrants occupational income in new zealand the supply of graduates in new zealand and political instability in fiji using a reduced form supply demand model to estimate the determinants of migration the study finds that the number of professional migrants from fiji was significantly and positively related to previous year s migrants the real income in new zealand and political instability in fiji

time preference and international labor migration abstract this paper analyzes the pattern and welfare implications of international labor migration within a dynamic general equilibrium model in a two country overlapping generations world labor migrates unilaterally from the high low to the low high time preference country if both countries under over invest relative to the golden rule bilateral migration a theoretical novelty occurs if the countries are on opposite sides of the golden rule steady state welfare analysis is conducted where in contrast to existing results unilateral migration immiserizes non migrants in the immigration country while making non migrants in the immigration country at least as well off bilateral migration may improve world welfare

exploring the schemes for green climate fund financing international lessons summary as a key issue in recent international climate summits the green climate fund gcf is confronted with the problem of insufficient financing this paper intends to explore several schemes for raising the public finance of the gcf among developed countries lessons from three main ongoing international financing mechanisms have been drawn including the united nations un membership dues official development assistance oda and the global environment facility gef the indexes that reflect historical emission responsibility hr and ability to pay ap are also used to share the burden results reveal that the ongoing international financing mechanisms vary in their burden sharing results and the shares of existing donors are driven by highly complex reasons weighting the hr un and gef approaches with the preference score compromises psc method could yield a compromise scheme in which the regional contributions are highly similar to those under the gcf initial resource mobilization from 2015 to 2018 gcf financing heavily depends on contributions from the developed countries even if the donor parties are extended to emerging economics this paper also finds that the decision of the united states to withdraw from climate finance will significantly increase the burden for other donors particularly for the european union the contribution share of which is predicted to increase to nearly 14 percentage points the schemes proposed in this study can provide a useful reference for gcf financing

equity in international greenhouse gases abatement scenarios a multicriteria approach abstract the climate change problem involves long term global efforts through sustainable development the international burden sharing of greenhouse gases ghg abatement constitutes a controversial debate equity is an important issue to be considered in the mitigation policies to insure the participation of as many developing countries as possible the main purpose of this research is to allocate equitable international ghg emission entitlements using several criteria there are many equity definitions and some are conflicting a dynamical multicriterion method is proposed to compare various alternatives and to find a compromise solution if the decision making process can take into account interests and preoccupations of every country significant progress could be made to achieve a world consensus several burden sharing schemes are proposed then modeling abatement scenarios using the times world energy model will allow us to determine the cost effectiveness opportunities

stocking retail assortments under dynamic consumer substitution we analyze a single period stochastic inventory model newsboy like model in which a sequence of heterogeneous customers dynamically substitute among product variants within a retail assortment when inventory is depleted the customer choice decisions are based on a natural and classical utility maximization criterion faced with such substitution behavior the retailer must choose initial inventory levels for the assortment to maximize expected profits using a sample path analysis we analyze structural properties of the expected profit function we show that under very general assumptions on the demand process total sales of each product are concave in their own inventory levels and possess the so calleddecreasing differences property meaning that the marginal value of an additional unit of the given product is decreasing in the inventory levels of all other products for a continuous relaxation of the problem we then show via counterexamples that the expected profit function is in general not even quasiconcave thus global optimization may be difficult however we propose and analyze a stochastic gradient algorithm for the problem and prove that it converges to a stationary point of the expected profit function under mild conditions finally we apply the algorithm to a set of numerical examples and compare the resulting inventory decisions to those of some simpler naive heuristics the examples show that substitution effects can have a significant impact on an assortment s gross profits the examples also illustrate some systematic distortions in inventory decisions if substitution effects are ignored in particular under substitution one should stock relatively more of popular variants and relatively less of unpopular variants than a traditional newsboy analysis indicates

the multi item newsvendor model with cross selling and the solution when demand is jointly normally distributed abstract products are often demanded in tandem because of the cross selling effect the demand for an item can increase if sales of its cross selling associated items are achieved or decrease when the associated items are out of stock resulting in lost sales therefore a joint inventory policy should be pursued in a cross selling system this paper introduces customer driven cross selling into centralized and competitive newsvendor nv models by representing an item s effective demand as a function of other items order quantities we derive first order optimality conditions for the centralized model in addition to pure strategy nash equilibrium conditions and uniqueness conditions of the equilibria for the competitive model we further develop gradient based gb and iteration based ib algorithms to solve the centralized and competitive models respectively a computational study verifies the effectiveness of the proposed algorithms the computational results show that a larger cross selling effect leads to a larger order quantity in a centralized nv model but a smaller order quantity in a competitive nv model and a larger positive correlation between items demands leads to higher profits with smaller order quantities in both models moreover nvs will order more items if the demand variance is greater however resulting in lower profits in a competitive situation one will prefer smaller order quantities than in a centralized decision situation

the impact of host country schooling on earnings a study of male immigrants in the united states immigrants in the united states who acquire u s schooling earn higher wages than other immigrants using data from the u s censuses and the national longitudinal survey of youth we show that this wage advantage results from both greater educational attainment and higher returns to education the higher returns are not the consequence of ability bias or greater english proficiency of those who acquire u s schooling returns to years of non u s education are higher for immigrants who complete their schooling in the united states consistent with the view that u s schooling upgrades or certifies education received in the source country for those without u s schooling returns are higher for immigrants from highly developed countries and countries for which english is an official language

migration and labour markets in oecd countries a panel cointegration approach this article examines the interaction between immigration and the host labour market of 14 organization for economic co operation and development oecd countries using nonstationary panel data methodology we estimate a trivariate vector error correction model vecm and derive causality tests to simultaneously assess the long and short term macroeconomic impact of newcomers on wages and unemployment levels in the host country the results suggest that an increase of migrants is likely to increase wages in the destination countries in the short run but to increase them in the long run there is no evidence of adverse effects on unemployment due to immigration in short and long term except for anglo saxon countries in the short term our findings also show that immigration is conditioned by levels of unemployment and wages especially in anglo saxon countries

illegal immigration in an efficiency wage model abstract this paper studies illegal immigration using an efficiency wage dual labor market model the illegal immigrants are endogenously sorted completely or incompletely into secondary labor markets the effects of immigration on native workers are more complex than in standard models of factor mobility as illegals first enter the country natives may gain because the number of primary sector jobs rises with enough illegals in the country natives are hurt because the migrants increasingly take those primary sector jobs enforcing immigration laws by deporting migrants who work in primary sector jobs is pareto superior to other forms of enforcement

newsvendor problem with clearance pricing abstract the newsvendor nv problem assumes that the salvage clearance price at which the leftover inventory is disposed of is a given parameter of the problem in this paper we relax this assumption and consider the nv problem with the salvage clearance price as a decision variable we have drawn from the literatures on the nv problem and clearance markdown dynamic pricing to develop three stochastic models in this paper in the first model we assume that while the seasonal demand is exogenous and stochastic the end of season demand is endogenous and deterministic the second model extends the first model by assuming that the end of season demand is endogenous and stochastic finally the third model considers that both the seasonal and end of season demands are endogenous and stochastic we have provided solution procedures for solving the stochastic optimization problems we have also performed sensitivity analyses to assess the sensitivity of the optimal expected profit and order quantity to different problem parameters specifically we have found that the optimal expected profit is most sensitive to the variable cost per unit mean seasonal demand and market potential of end of season demand our models will be useful for retailers of products with a short selling season and a short end of season period for clearance sale of leftover inventory such that there is a single replenishment opportunity at the beginning of the season and a single opportunity for setting the salvage price for clearance sale based on the leftover inventory and end of season demand pattern the paper is concluded with possible directions for future research

revenue management through dynamic cross selling in e commerce retailing we consider the problem of dynamically cross selling products e g books or services e g travel reservations in the e commerce setting in particular we look at a company that faces a stream of stochastic customer arrivals and may offer each customer a choice between the requested product and a package containing the requested product as well as another product what we call a packaging complement given consumer preferences and product inventories we analyze two issues 1 how to select packaging complements and 2 how to price product packages to maximize profits we formulate the cross selling problem as a stochastic dynamic program blended with combinatorial optimization we demonstrate the state dependent and dynamic nature of the optimal package selection problem and derive the structural properties of the dynamic pricing problem in particular we focus on two practical business settings with the emergency replenishment model and without the lost sales model the possibility of inventory replenishment in the case of a product stockout for the emergency replenishment model we establish that the problem is separable in the initial inventory of all products and hence the dimensionality of the dynamic program can be significantly reduced for both models we suggest several packaging pricing heuristics and test their effectiveness numerically

the ramaswami proposition and the choice among labor capital and technology flows abstract this paper examines the choice between labor and capital flows in the context of a one good two country model where the two countries differ in their levels of disembodied technology in contrast to the ramaswami proposition it is shown that a country may prefer an optimal outflow of its abundant factor to an optimal inflow of its scarce factor it is also shown that for sufficiently small differences in technology the labor rich technology inferior country will benefit more from an optimal outflow of labor than from a gift of superior technology

assimilation changes in cohort quality and the earnings of immigrants this paper reexamines the empirical basis for two facts that seem to be found in most cross section studies of immigrant earnings 1 the earnings of immigrants grow rapidly as they assimilate into the united states and 2 this rapid growth leads to many immigrants overtaking the earnings of the natives within 10 15 years after immigration using the 1970 and 1980 u s censuses this paper studies the earnings growth experienced by specific immigrant cohorts during the period 1970 80 it is found that within cohort growth is significantly smaller than the growth predicted by cross section regressions for most immigrant groups this differential is consistent with the hypothesis that there has been a secular decline in the quality of immigrants admitted to the united states

people flows in globalization the policy debate over globalization in the past decade has largely bypassed the international mobility of labor restrict trade and cries of protectionism resound suggest linking labor standards to trade and it s protectionism in disguise limit capital flows and the international monetary fund is on your back but restrict people flows that s just an accepted exercise of national sovereignty during the last few decades when most countries reduced barriers to trade in goods and services and liberalized financial capital markets most also sought to limit immigration in this essay i examine what we know about the causes and consequences of immigration i argue that people flows are fundamental to creating a global economy and that the interplay among immigration capital and trade is essential to understanding the way globalization affects economies i consider ways to reduce barriers to immigration that could improve the well being of workers around the world

incorporating one way substitution policy into the newsboy problem with imprecise customer demand this paper presents an approach for solving an inventory model for single period products with maximizing its expected profit in a fuzzy environment in which the retailer has the opportunity for substitution though various structures of substitution arise in real life in this study we consider the fuzzy model for two item with one way substitution policy this one way substitutability is reasonable when the products can be stored according to certain attribute levels such as quality brand or package size again to describe uncertainty usually probability density functions are being used however there are many situations in real world that utilize knowledge based information to describe the uncertainty the objective of this study is to provide an analysis of single period inventory model in a fuzzy environment that enables us to compute the expected resultant profit under substitution an efficient numerical search procedure is provided to identify the optimal order quantities in which the utilization of imprecise demand and the use of one way substitution policy increase the average expected profit the benefit of product substitution is illustrated through numerical example

international factor mobility and national advantage abstract in this paper we prove rigorously v k ramaswami s proposition that in bilateral trade between two countries sharing the same technology represented by a strictly concave production function with positive marginal productivities of capital and labor the policy active country can gain more by importing monopsonistically the relatively scarce factor than by placing monopolistic restrictions on the export of the relatively abundant one we show that what matters is not the location but the constraints within which maximization takes place hence the monopsonistic results can be replicated by appropriate export arrangements the analysis is extended to consider the welfare implications to the policy passive country

human capital investment and migration in an integrated europe the short and longer term regional consequences of migration for european aggregate supply are examined in a simple model in which human capital enters the production function externally the planner chooses a reallocation of population across east and west that cannot be replicated by the market without taxes or subsidies the market solution in this model with free migration is always associated with an efficiency loss and might lead to the mezzogiorno syndrome in the east excerpt

immigration and wages evidence from construction to identify relative wage impacts of immigration we make use of certification and licensing requirements in the norwegian construction sector that give rise to exogenous variation in immigrant employment shares across trades individual panel data reveal substantially lower wage growth for workers in trades with rising immigrant employment than for other workers selective attrition from the sector masks the causal wage impact unless accounted for by individual fixed effects for low and semi skilled workers effects of new immigration are comparable for natives and older immigrant cohorts consistent with perfect substitutability between native and immigrant labor within trade finally we present evidence that immigration reduces price inflation as price increases over the sample period were significantly lower in activities with growth in the immigrant share than in activities with no or small change in immigrant employment

choice between international capital and labor mobility for diversified economies abstract this paper ranks two international economic regimes free trade plus free international capital mobility and free trade plus free international labor mobility from the viewpoint of two countries which are under diversified production in a two factor two good general equilibrium model in which production technologies are internationally different it shows that a country s preference toward the two regimes is determined by relative factor endowments relative factor intensities and inter country difference in labor productivity and that under some circumstances both countries unanimously prefer the same regime but under other circumstances they prefer different regimes

the effect of naturalization on wage growth a panel study of young male immigrants for young male immigrants naturalization facilitates assimilation into the u s labor market following naturalization immigrants gain access to public sector white collar and union jobs and wage growth accelerates consistent with removal of employment barriers the faster wage growth of immigrants who naturalize might alternatively result from greater human capital investment prior to naturalization stemming from a long term commitment to u s labor markets but there is no evidence that wage growth accelerates or the distribution of jobs improves until citizenship is attained finally the gains from naturalization are greater for immigrants from less developed countries and persist when we control for unobserved productivity

an extension of partial backordering eoq with correlated demand caused by cross selling considering multiple minor items abstract zhang et al 2011 proposed the partial backordering eoq with correlated demand caused by cross selling where a portion of the sales of a minor item is associated with those of a major item in this paper we extend their model to make it more applicable to dealing with the inventory replenishment problem for multiple associated items we formulate the model as a mixed integer nonlinear programming minlp problem and develop a global optimum search procedure with the fill rate given we further employ a one dimensional search on the fill rate to obtain the minimum total inventory cost within a predetermined precision which enjoys polynomial computational complexity

equity in climate change an analytical review how global emissions reduction targets can be achieved equitably is a key issue in climate change discussions this paper presents an analytical framework to encompass contributions to the literature on equity in climate change and highlights the consequences in terms of future emissions allocations of different approaches to equity progressive cuts relative to historic levels for example 80 percent by industrial countries and 20 percent by developing countries in effect accord primacy to adjustment costs and favor large current emitters such as the united states canada australia oil exporters and china in contrast principles of equal per capita emissions historic responsibility and ability to pay favor some large and poor developing countries such as india indonesia and the philippines but hurt industrial countries as well as many other developing countries the principle of preserving future development opportunities has the appeal that it does not constrain developing countries in the future by a problem that they did not largely cause in the past but it shifts the burden of meeting climate change goals entirely to industrial countries given the strong conflicts of interest in defining equity in emission allocations it may be desirable to shift the emphasis of international cooperation toward generating a low carbon technology revolution equity considerations would then play a role not in allocating a shrinking emissions pie but in informing the relative contributions of countries to generating such a pie enlarging revolution

immigrants in the u s labor market 1940 80 this paper explores the extent and causes of the decline in immigrant skills in the united states during the postwar period prior to 1965 immigration to the united states was guided by the national origins quota system this visa allocation system awarded visas to countries based on the representation of the national origin group in the u s population as of 1920 the 1965 amendments abolished the national origins formula thus redistributing visas across source countries and established a system where visas are mainly given to relatives of u s citizens or residents the empirical analysis shows that a single factor the changing national origin mix of the immigrant flow is mainly responsible for the decline in immigrant skills excerpt

the impact of product substitution on retail merchandising abstract we analyze the impact of product substitution on two key aspects of retail merchandising order quantities and expected profits to perform this analysis we extend the basic news vendor model to include the possibility that a product with surplus inventory can be used as a substitute for out of stock products this extension requires a definition and an approximation for the resulting effective demand under substitution a service rate heuristic is developed to solve the extended problem the performance of this heuristic is evaluated using an upper bound generated by solving the associated lagrangian dual problem our analysis suggests that this heuristic provides a tractable and accurate method to determine order quantities and expected profits under substitution we apply this heuristic to examine how the level of demand uncertainty and correlation and the degree of substitution between products affect order quantities and expected profits under substitutable demand in addition we use the heuristic to better understand the mechanism by which substitution improves expected profits

motivations of south african emigrants reasons for emigration from south africa particularly of professionals are investigated using data from a recent survey the authors conclude that although direct fear of potential violence is not a major factor emigrants are concerned about changes in living standards resulting from economic problems or changes in government structure annotation

factor rewards and the international migration of unskilled labor a model with capital mobility abstract conventional economic wisdom holds that the migration of unskilled labor from less developed countries to neighboring developed countries should be expected to narrow the wage gap between those countries and thereby reduce the incentive for further migration if capital is mobile internationally this reasoning may be inappropriate instead emigration of unskilled labor out of the less developed country provides an incentive for capital to leave the country too as a consequence wage rates move in the same direction in each country and the gap between wage rates across countries even may increase

optimal policy toward international factor movements with a country specific factor abstract this paper examines the optimal taxation of factor movements in a three factor model where two factors are potentially mobile results emphasize the role of substitutability or complementarity between factors in determining the optimal pattern of factor flows in particular a result analogous to the ramaswami result on the desirability of factor importing over factor exporting will hold if factors are complements but may not hold if they are substitutes also a capitalexporting country that cannot tax imported labor should allow labor imports when capital and labor are substitutes but may not allow labor imports if they are complements

job search and immigrant assimilation an earnings frontier approach this study examines labor market assimilation by measuring the information utilized by immigrants during job search assimilation is assumed to occur whenever such information increases with length of residence in the united states and repeated job searches the authors assert that information utilized during job search reduces differentials between actual and potential maximum attainable earnings coauthors are henry w herzog jr richard a hofler and alan m schlottmann copyright 1992 by mit press

the parallel market of illegal aliens a computational approach abstract this paper develops the notion of illegal aliens as a parallel market in coexistence with the regular market of legal labor in the presence of both price controls on legal labor by minimum wage legislation and quantity controls on illegal aliens by immigration laws illegal aliens involve not only rural urban migration but also tax evasion and deportation costs we develop an analytical equilibrium structure which links markets for legal labor and illegal aliens illustrate how much an equilibrium can be computed and explore some implications of the linkage using united states data

the newsvendor problem review and directions for future research in this paper we review the contributions to date for analyzing the newsvendor problem our focus is on examining the specific extensions for analyzing this problem in the context of modeling customer demand supplier costs and the buyer risk profile more specifically we analyze the impact of market price marketing effort and stocking quantity on customer demand how supplier prices can serve as a coordination mechanism in a supply chain setting integrating alternative supplier pricing policies within the newsvendor framework and how the buyer s risk profile moderates the newsvendor order quantity decision for each of these areas we summarize the current literature and develop extensions finally we also propose directions for future research

factor content functions and the theory of international trade this paper introduces the concepts of direct and indirect factor trade utility functions and uses them to derive marshallian and hicksian factor content functions which express the quantities of factors of production embodied in net imports as functions of the exogenous variables facing the economy the properties of these functions are discussed and they are used to derive a number of new results in particular it is shown that in certain circumstances the existence of gains from trade is sufficient for the heckscher ohlin theorem to hold in its factor content form

analyzing trade offs in international climate policy options the case of the green climate fund summary we investigate the trade offs between economic growth and low carbon targets for developing and developed countries in the period up to 2035 policy options are evaluated with an original version of the dynamic cge model gdyne abatement costs appear to be strongly detrimental to economic growth for developing countries we investigate options for reducing these costs that are consistent with the current negotiations we show that the green climate fund financed through a levy on carbon taxation can benefit all parties and large benefits are associated with investment of the green climate fund to foster energy efficiency in developing countries

the use of transfer payments by immigrants this paper uses data from the 1976 survey of income and education to compare the receipt of transfers by families headed by male and female immigrants and those headed by native born americans the average level of transfers is found to be considerably higher among families headed by immigrants but this is almost entirely the result of the higher average age of family members among the immigrant group a reflection of the large inflows of immigrants into the u s during the pre 1924 period when age and other factors are held constant immigrant families are found to be considerably less likely to rely on welfare than native families and their receipts from social insurance programs are found to be only slightly higher

are international trade and factor mobility substitutes abstract this paper analyzes whether factor flows and commodity trade are substitutes or complements i e whether increasing the level of one impacts adversely or favorably on the volume of the other it derives with the aid of a new general equilibrium framework of the world which allows possible differences in factor endowments tastes and technologies across the two trading countries the necessary and sufficient condition for substitutability and complementarity the results are then further examined in two special cases a survey of different concepts of substitutability and complementarity which have appeared in the literature is also given

convergence of carbon dioxide performance across swedish industrial sectors an environmental index approach the overall objective of the paper is to analyze convergence of co2 emission intensity across manufacturing sectors in sweden our approach differs from previous work on carbon convergence in that

productivity of highly skilled immigrants economists in the postwar period larry d singell jr prior work finds declining immigrant quality in the postwar period that is linked to source country and skill composition changes associated with the 1965 immigration act this paper uses a unique panel of foreign and native born american economic association members to show that the highly skilled experienced a similar shift away from european migrants toward those from asia however the findings do not indicate that this change in source country composition has been accompanied by a decline in quality rather the most recent cohorts of foreign born economists appear to be more productive than their native counterparts jel j61 i introduction this article is the first systematic analysis of the attributes and abilities of foreign born u s economists since a descriptive study of the brain drain by grubel and scott 1967 it also provides some of the first formal evidence for the largely theoretical proposition in earlier work by bhagwati and rodriquez 1975 that the united states draws the best skilled workers from abroad however recent immigration literature has not focused on the brain drain but has generated considerable debate concerning whether the 1965 immigration and nationality act has reduced the skill quality of u s immigrants in particular descriptive evidence in borjas 1987 and greenwood 1983 respectively indicates that the 1965 law shifted the composition of u s immigrants toward non european nations and increased the number of low skilled migrants to the united states our article extends this work by examining whether there has been a post 1965 change in the source country mix of ph d economists and whether such chan ges impact the productivity of the foreign born in comparison to their native counterparts most empirical studies of immigrant productivity have focused on earnings early cross sectional studies of immigrant earnings including chiswick 1978a concluded that the age earnings profile of immigrants is steeper than that of comparable native born workers and though initially lower crosses the native profile 10 to 15 years after immigration these results are consistent with the widely held belief that the immigration process self selects the highly motivated and industrious from their respective source countries thus immigrants although they initially enter the united states with relatively low levels of human capital eventually become more productive than their native counterparts more recent work by borjas 1985 1987 has contested these conclusions arguing that it is not possible to separately identify assimilation and cohort effects using a single cross sectional data set in particular the positive correlation between earnings and years since migration in cross sectional data may be due to immigrant assimilation or a cohort effect that arises from the declining skill quality of more recent immigrant groups borjas combines multiple cross sectional data sets to separately identify assimilation and cohort effects and finds evidence indicating that earlier cohorts of immigrants do relatively better than both natives and more recent immigrant cohorts suggesting a decline in immigrant quality although chiswick 1986 challenges the contention of declining immigrant quality and funkhouser and trejo 1995 find evidence that immigrant quality may have increased during the 1980s borjas 1995 contends that the empirical evidence consistently shows that immigrant quality has declined for most of the postwar period however the decline in immigrant quality has not necessarily been found within specific groups of immigrants in particular greenwood and mcdowell 1986 find that the change in skill quality is related to the shift in the source country composition of immigrants away from european nations toward those from asia and latin american after the 1965 immigration act thus explanations for the relatively poor performance of recent immigrants including those in lalonde and topel 1991 1992 and borjas 1992 focus on the post 1965 changes in the incentives to migrate to the united states that have increased the number of low skilled non european immigrants

the economic analysis of international migration a generalization this note examines and extends the following two propositions that finite international factor movements are beneficial to the nationals of the destination country but detrimental to those left behind in the source country and that marginal movements do not have such welfare effects using some newly developed techniques the propositions are found to be valid irrespective of the number of goods and factors if the economy starts from the autarky position when only one factor can flow the gain of the nationals loss of those left behind will be positively dependent upon the amount of inflow outflow however if goods trade and or factor flow are initially present the propositions are in general not true summary in fre excerpt

on the choice between international capital and labor mobility abstract this paper examines the choice of international factor mobility it proves in a two country two factor one commodity model that the policy setter when it maximizes its own welfare by following the ramaswami policy of monopsonistic import of its scarce factor impoverishes the passive country furthermore the paper studies the choice of mobility in a two commodity model and shows that the optimality of the monopsonistic import policy extends to a situation with trade in goods lastly it addresses the welfare effects in the passive country in the two commodity model

a global compass for the great divergence emissions vs production centers of gravity 1820 2008 we construct the world s centres of gravity for human population gdp and co2 emissions by taking the best out of five recognised data sources covering the last two centuries on the basis of a novel distortion free representation of these centres of gravity we find a radical western shift of gdp and co2 emission centres in the nineteenth century in sharp contrast with the stability of the demographic centre of gravity both gdp and emissions trends are reversed in the first half of the twentieth century after world war i for co2 emissions after world war ii for gdp since then both centres are moving eastward at an accelerating speed these patterns are perfectly consistent with the lead of western countries starting the industrial revolution the gradual replacement of coal by oil and gas as alternative sources of energy and the progressive catch up of asian countries in the recent past

perspectives on buy outs and the ramaswami effect abstract in a simple two factor one commodity model in which foreign labor can be hired at low foreign wage rates and technology is common to both countries optimal strategy at home involves hiring almost all factors abroad at their autarky prices a buy out strategy this paper shows that when technologies differ partial or times complete buy out of factors from the technologically superior country may still be optimal alternatively a partial buy out may be appropriate when there exists a third internationally immobile productive factor

the work effort and the consumption of immigrants as a function of their assimilation positive self selection has been used to explain the superior economic performance of some immigrant groups even if immigrants and natives are identical however the former face different incentives in particular they bear costs not incurred by natives including monetary costs of moving costs of staying in touch with family and obligations to those left behind nonmonetary costs include stress and loss of location specific human capital the focus of this paper is on how these costs influence the decisions of immigrants relative to those of natives particular attention is given to the role of assimilation

a political economic analysis of labor migration and income redistribution we present a two country political economic model of income redistribution with internationally mobile labor migration can be exogenous and or endogenous i e determined by labor income differentials political influence is determined by the size and homogeneity of the groups where the latter can be affected by immigration we show that immigration can increase the transfers to and the income of the mobile group we also investigate the possibility of migration regulation tax transfer policy competition and coordination and finally coordination of regulation policies it is shown that the selection of any of those regimes will depend on the particular distribution of political influence among the relevant social groups in the two countries

on the strategic choice between capital and labor mobility abstract this paper analyzes the strategies of two governments when choosing between capital and labor mobility for each type of factor mobility the nash equilibria under both income taxes and quotas on factor flows are derived from each country s point of view an income tax dominates a quota the paper also shows that in a strategic environment ramaswami s result that a country prefers the restricted inflow of a scarce factor to the restricted outflow of an abundant factor continues to hold for some initial factor endowments but the opposite result may obtain for other factor endowments

on the choice between capital and labour mobility trade theorists since the pioneering work of kemp 1966 have considered the question of national advantage from international factor mobility by considering only one factor to be so mobile kemp analyzed elegantly the question of optimal policies in 2 x 2 x 2 model and showed that since monopoly power could exist in both the goods and factor markets in consequence of international capital mobility the optimal policy intervention would generally involve two policy instruments tariffs cum subsidies on goods and duties cum subsidies on international capital flows jones 1967 subsequently extended kemp s argument to the secondbest context by examining the optimal level of one of these instruments when the other was arbitrarily set at zero elsewhere in this issue brecher 1983 shows in an elegant and original contribution that the jones policy problem is in fact a third best rather than a second best problem as generally believed and that if only one of the tariff and capital mobility taxes cumsubsidies can be used it is generally possible to improve welfare further by admitting an altogether different domestic policy instrument namely a production or consumption tax cum subsidy as the case may be the research of bhagwati was supported by the german marshall fund grant no l 34015 the problem analyzed in the paper was posed in bhagwati 1979 and an early ingenious and neglected analysis in ramaswami 1968 was noted by bhagwati we have profited greatly from these contributions also from reading webb 1970 ramaswami 1970 and a recent paper of calvo and wellisz 1983 on this problem this result is in consonance with the results of bhagwati ramaswami and srinivasan 1969 for the case without international capital mobility but the consonance is intuitive only after the result was established for the case with international capital mobility