hospital choices hospital prices and financial incentives to physicians we estimate an insurer speci c preference function which rationalizes hospital referrals for privately insured births in california the function is additively separable in a hospital price paid by the insurer the distance traveled and plan and severity speci c hospital xed eects capturing hospital quality we use an inequality estimator that allows for errors in price and detailed hospital severity interactions and obtain markedly dierent results than those from a logit the estimates indicate that insurers with more capitated physicians are more responsive to price capitated plans send patients further to utilize similar quality lower priced hospitals but the cost quality trade odoes not vary with capitation rates the patient protection and aordable care act of 2010 includes provisions to establish ac countable care organizations acos in the medicare program these are groups of health care providers that oer services to a large number of patients and are eligible to share in any cost savings they achieve for the medicare program 1 private sector acos are forming in parallel to this initiative often with very similar structures and payment arrangements the proportion of savings acos keep is linked to their performance on quality standards the goal of the initiative is to reduce health care costs in both medicare and private insurance and to improve coordination of care the tying of cost savings to quality standards is designed to mitigate the concern that an increase in incentives to control costs might lead to a decrease in the quality of care the health policy literature has noted that similar cost control incentives are currently utilized by some health maintenance organizations hmos in california and elsewhere 2 in this paper we investigate the impact of these incentives on the cost and quality of care provided to patients focusing in particular on the choice of hospital for privately insured patients giving birth we use

returns to work child labor and schooling the income vs price effects abstract this study examines the impact of returns to work for adult labor and child labor on child work and schooling outcomes we propose an empirical strategy that sheds light on the underlying income and price effects specifically we exploit variations in child labor intensity across crops and exogenous changes in crop tariffs following the 1991 indian trade liberalization exploiting pre reform district variations in crop composition we find opposite effects of tariff reductions for adult labor intensive crops and child labor intensive crops while reductions in the returns to adult labor lead to a negative income effect that reduces schooling reductions in the returns to child labor increase schooling due to the countervailing price effect we further document substantial heterogeneity across gender the price effect outweighs the income effect for boys but not for girls using a back of the envelope calculation we estimate the schooling elasticities with respect to returns to adult labor and child labor to be 0 23 and 0 86 respectively

partial vertical integration risk shifting and product rejection in the high value export supply chain the ghana pineapple sector summary high value export supply chains hold potential to improve smallholders welfare but their relative production inefficiency and moral hazard problems can cause exporters to prefer vertically integrated plantation production however pineapple exporters in ghana produce both for their own account and purchase from smallholders we hypothesize that vertical integration is only partial because exporters face large market risks that smallholders surprisingly are better able to absorb we show empirically that exporters average rejection rate of export quality fruit is high and varies in response to unanticipated fluctuations in european demand these results support the hypothesis and are consistent with theories of partial vertical integration but not the standard principal agent paradigm

the role of consumption credit in agricultural tenancy abstract in traditional agriculture it is common practice for landlords to give consumption loans to their own tenants if the tenant derives all his income from the landlord it is puzzling that the landlors needs another means of expropriating the surplus he could just raise the rent the paper suggests that consumption credit may be a side payment designed to enable the landlord to absorb the tenant s risk due to weather uncertainty without weakening his incentive to work tenancy is modelled as an agency contract designed in terms of information may be available to the landlord

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

the supply of charity services by nonprofit hospitals motives and market structure this article studies provision of charity care by private nonprofit hospitals we demonstrate that in the absence of large positive income effects on charity care supply convex preferences for the nonprofit hospital imply crowding out by other private or government hospitals extending our model to include impure altruism rivalry provides a possible explanation for the previously reported empirical result that both crowding out and income effects on indigent care supply are often weak or insignificant empirical analysis of data for hospitals in maryland provides evidence of rivalry on the supply of charity care

sharecropping and the capitalist transition in agriculture some evidence from the highlands of ecuador abstract sharecropping has been the subject of much debate among economists concerned with static efficiency and to some extent with equity this paper shifts the focus to the dynamics of structural change the research reported adds to the discussion a detailed account of a large number of sharecropping contracts and why they vary and offers a theory of the relationship between sharecropping as practised in the ecuadorian province of carchi and a particular pattern of structural change which is described as the transition to an agrarian structure dominated by capitalised family farms the prevalent use of wage labour on sharecropped land and the place of sharecropping in intergenerational asset transfers are shown to be important elements in explaining this transition

women s access to labor market opportunities control of household resources and domestic violence evidence from bangladesh summary while there are many positive societal implications of increased female labor force participation working may increase a woman s risk of domestic violence using data i collected from bangladesh i document a positive correlation between work and domestic violence but only among women with low education or young age at marriage these results suggest that women with low bargaining power face increased risk of domestic violence upon entering the labor force as their husbands seek to counteract their increased bargaining power consequently policies that increase women s baseline bargaining power will decrease the risk that they face domestic violence upon beginning work

cost sharing arrangements under sharecropping moral hazard incentive flexibility and risk this paper explains the rationale and describes the characteristics of cost sharing arrangements in rural developing economies focusing on the risk and incentive properties of alternative cost contracts and on their flexibility their ability to adapt to environmental changes it is shown that where labor inputs are difficult to monitor the rule that cost shares and output shares be equalized will not hold and is not constrained pareto efficient and that cost sharing contracts have a decided advantage over contracts which specify the level of inputs whenever there are asymmetries of information regarding production technology between the landlord and the tenant

insurer hospital bargaining negotiated discounts in post deregulation connecticut this paper uses unique data from the state of connecticut to examine discounting patterns in the state s hospital industry for the years following deregulation 1995 1998 the data provide a rare opportunity to study payer level differences in negotiated discounts for hospital services in addition to presenting descriptive evidence on how discounts vary across payers payer types and hospital types this study uses matched revenue data to analyze the economic determinants of discount magnitudes payer size appears to affect bargaining power but the economic significance of the effect is small the data exhibit patterns consistent with a bargaining explanation in which discount magnitudes depend critically on payers abilities to channel patients to hospitals with which favorable discounts have been negotiated

the effects of regulation and competition in the nhs internal market the case of general practice fundholder prices the 1989 reforms of the uk national health service introduced competition in supply within a tightly regulated framework the paper examines whether this competition affects the prices posted by sellers of medical services we argue that despite regulation market forces may have an impact on price we test this using the posted prices for one of the two types of buyer general practice fundholders we find the regulatory rules are not observed and some evidence of the impact of market forces on price

the influence of commodity programs on acreage response to market price with an illustration concerning rice policy in the united states farm programs influence the parameters of typically estimated supply functions we develop and apply an approach that uses detailed information about farm program incentives and constraints to identify underlying structural acreage response parameters when the data reflect behavior under complex government commodity programs we illustrate the approach with data on rice acreage response to market price in the united states for u s rice estimates that fail to appropriately incorporate the program rules under which market data were generated are three to four times smaller than the structural parameters that are useful for most policy analysis or projections under alternative policies

changing the economics of environmental degradation in madagascar lessons from the national environmental action plan process abstract this paper examines the economic logic and implicit assumptions used to develop and support the national environmental action plan neap process in madagascar the study focuses on three key issues how were the costs of the main environmental problems identified and estimated what underlying factors were identified as causing these problems and how is the neap implementation strategy designed to change these underlying factors the most difficult tasks for neaps will continue to be identifying the key specific underlying factors causing the problem and determining which of these factors are actually feasible for a neap process to change the analysis of the madagascar makes clear that key environmental problems are driven by land use decisions of large numbers of geographically dispersed rural and urban inhabitants these problems are not easy or even feasible targets for specific environmental policy changes if this is the case as it seems to be in madagascar then it is perhaps unrealistic to hope that neaps as constituted can provide a framework for both understanding and alleviating a country s key environmental problems

theories of share tenancy a critical survey for the past 2 decades the problems of agricultural tenancy have attracted a great deal of attention not only from agricultural economists but also from economists in general as a typical example of agencyprincipal contract relations despite the prolific growth of literature both theoretical and empirical there has been little convergence in opinions on tenancy contracts the divergence has been especially great on the understanding of the causes and the effects of sharecropping tenancy much confusion underlying the widely divergent perspectives has stemmed from partial treatments of contractual choice which unduly limit the optimizing behavior of contracting parties and the options of contract forms this essay aims at clarifying the sources of the confusion by reviewing the past literature in light of the more general theory of agency principal relations the agency theory in order to examine the problems of various theoretical models in a unified framework in section ii we first develop the basic framework of a general model of tenancy contract in section iii we clarify in terms of the general model contradictions latent in the traditional marshallian theory which asserts that share tenancy is inefficient because of the disincentive effect of cropsharing on the tenant s work effort in section iv we attempt to show that recent efforts to reconstruct the theory based on the traditional assumption have not yet been quite successful section v draws implications and testable hypotheses from more general theories incorporating the aspects of risk and uncertainty section vi tests allocational and distributional implications of those alternative hypotheses based on the summary of evidence col

agricultural land relations in the developing world in this paper we draw on a number of methodological approaches which have been used to explain land relations tenancy sharecropping and interlinking distress sales dualistic land ownership distributions classes and land reform and their variations over space and time we indicate that the explanatory power of theories on land relations hinges on the complexity market imperfections and distortions admitted in the analysis

market structure and prices the responses of hospitals in the uk national health service to competition abstract the internal market reforms to the uk national health service nhs are a model adopted in many health care systems they introduce competition in supply little is known about the impact of these reforms this paper examines the pricing responses of nhs suppliers to competition the incentives of the reformed system are analysed these indicate that prices should differ between buyers and markets these hypotheses are tested using data on spot market transactions between hospitals and health care buyers the results indicate considerable price variability but offer broad support for the hypotheses

determinants and consequences of land reform implementation in the philippines abstract unlike the experience of other developing countries land reform in the philippines has been successful in converting many of share tenants to land reform beneficiaries this study indicates that the implementation of land reform is positively associated with yield growth made possible by the adoption of modern seed fertilizer technology a major reason underlying such association is considered to be an increased economic interest of tenants in land reform arising from divergence of rental value of land from leasehold rent and amortization fees prescribed by law

medical interventions among pregnant women in fee for service and managed care insurance a propensity score analysis this paper extends earlier research on the effect of managed care on the receipt of four medical interventions for pregnant women ultrasound induction stimulation of birth electronic fetal monitor and caesarean delivery propensity score methods are used to account for sample selection issues regarding insurance choice managed care enrollees are more likely to receive an ultrasound which may be indicative of receiving better prenatal care managed care plans reduce the rate of caesarean deliveries but such limitations may be beneficial given the substantial medical evidence that caesarean deliveries are over utilized the results indicate that insurance coverage does influence treatment intensity but that utilization controls and provider financial incentives do not adversely affect care for pregnant women

gender parity and schooling choices abstractwe examine the determinants of gender differences in schooling choices using data on 290 000 secondary school applicants in ghana over a quarter of female students choose home economics as their preferred field of study compared to two per cent of males we find that schooling choices vary significantly with academic performance and educational norms higher performing female students and those from districts with a history of gender parity in educational attainment are less likely to choose home economics differences across geographic areas account for more of the variation in schooling choices than observable individual family and school level characteristics can explain

randomized evaluations of educational programs in developing countries some lessons this paper reviews recent randomized evaluations of educational programs in developing countries including programs to increase school participation to provide educational inputs and to reform education it then extracts some lessons for education policy and for the practice and political economy of randomized evaluations

contract choice and enforcement in an agrarian community agricultural tenancy in upland java this study explores the conditions under which a certain contract is preferred to others through an intensive survey of an upland village in west java despite an obvious difficulty in enforcing the terms of share contract in a highly complex intercropping system no significant difference in allocative efficiency was found between share tenancy and other forms of land tenure the results indicate that share tenancy was chosen only by the landlords who had the ability to enforce contractual terms at a low opportunity cost

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

nonprofit hospital mergers and the exercise of market power government challenges to mergers within the hospital industry have become more frequent many of those mergers involve nonprofit organizations rather than the for profit firms that are the norm in most other industries this difference in ownership has made no apparent difference in the antitrust agencies approach to proposed hospital mergers in this article i test the proposition that nonprofit and for profit hospitals price differently in response to the structure of the markets in which they compete based on a cross sectional analysis of california hospitals i find that estimated merger effects on hospital prices do vary by type of ownership in response to either higher market share or to the joint combination of higher share and higher market concentration private nonprofit hospital prices are statistically significantly lower than for profit hospital prices and on balance in this sample there is no evidence of any systematic price increasing effect on private nonprofit hospitals

land and the transition from a dual to a modern economy tenurial contracts in agriculture can be an initial source of wealth accumulation for dynasties of poor credit constrained individuals the income from such contracts can be invested in education of offspring who then can find work in the formal manufacturing sector this process allows the economy to develop into a modern economy with a large manufacturing sector an excessive number of poor individuals competing for scarce land however drives up the rental price of land which then slows the process of accumulation and forces the economy to converge to a less efficient dual equilibrium in such cases a policy of land redistribution coupled with a temporary education subsidy may be needed to push the economy to a modern equilibrium

the relationship between hospital mortality rates and hospital market and patient characteristics this study analyses the relationship between hospital outcome specifically mortality rates and various hospital and market characteristics the data are for all general acute care hospitals in california in 1991 that had at least 50 medicare cases selected by the health care financing administration hcfa for their computation of 1991 observed and predicted mortality rates the dependent variable was constructed from these mortality rates hospital and market characteristics were obtained from california s office of statewide health planning and development 1991 tapes the american hospital association s annual 1991 report 1990 census data and hcfa s 1991 medicare hospital mortality information report highly significant results p 0 01 were found for three of the predictor variables improved mortality rates were associated with a lower proportion of medicaid patients with a larger market and with a higher prior year profit margin other factors that contributed to improved mortality rates p

permanent labour and land tenancy contracts in agrarian economies an integrated analysis extending the existing models of land and labour contracts this study attempts to build a general model of long term agrarian contracts the model implies that where tenancy is an available option the fixed wage permanent labour contract will not be chosen if it is chosen under institutional constraints on tenancy contracts resulting resource allocations will be inefficient empirical relevance of the model is tested on data from the philippines

price and concentration in hospital markets the switch from patient driven to payer driven competition perhaps the most widely accepted paradigm of industrial organization i o is that competition lowers prices or alternatively that price cost margins are lower in less concentrated markets 1 the applicability of this paradigm for hospital markets has been questioned for example in united states vs carilion health system and roanoke valley hospital the district and appellate courts accepted evidence that hospital prices are lower in more concentrated markets and thereby approved a merger between the two largest hospitals in a three hospital market 2 the view that competition has a weak or perverse effect on hospital prices is shared by a number of researchers 3 is a common theme in newspaper stories

economic growth and the demand for education is there a wealth effect abstract human capital investment in developing countries is thought to be significantly constrained by household resources this paper studies the relationship between household resources and the demand for education using recent household survey data from vietnam the data cover a period 1993 1998 of exceptional income growth in vietnam during which secondary school enrollment rose substantially using consumption expenditures to measure household wealth we find a positive and significant relationship between changes in wealth and changes in the demand for education this wealth effect persists even after controlling for locality specific factors such as changes in education returns and the supply and quality of schools and for the opportunity costs of schooling

the equilibrium vector of pairwise bargained agency contracts with diverse actors and principals owning a fixed resource abstract the equilibrium vector of agency contracts where actors on both sides of the market are heterogenous and principals own a fixed resource is characterized and analyzed here auction markets are replaced by simultaneous multiple pair wise bargaining between principals and agents it is shown that the traditional analysis focusing on a single contract may lead to serious errors in addition the present analysis yields results concerning the equilibrium matching of principals and agents resource allocation across contracts and intercontract organizational externalities the latter are shown to create system inefficiencies

education human capital and growth a personal perspective this article reviews the literature on the relationship of economic growth to the education levels of the labor force the emphasis is on yoram ben porath s contribution to some of the issues in this field the endogeneity of schooling the role of the public sector as an absorber of educated labor and the importance of personal human capital created by investments in reputation and personal relationships the f connection

can empirical demand models assist in con comparative reviews a case study in florida certificate of need con programs for new hospital construction are intended to foster the best selection among competing hospital applications given demands for hospital care in the community yet the merits of con depend in part on the quality of the comparative review process this article examines a case study in florida to illustrate the utility of empirical evaluations using patient choice models i estimate such models to show how patients would respond to a change in hospital choices by simulating the welfare effects of the proposed hospitals i can further predict how prices of hospital care differ by applicant results suggest that empirical analysis using data on patient choice of hospitals may better inform the review process at the same time however it may not give a unique ranking without additional analysis of the fixed costs of proposed services in the context of existing marketwide capacity

abusa the structural history of an economic contract this speculative essay seeks an interpretation of abusa a share cropping arrangement which has been of fundamental importance in the development of the ghanaian cocoa industry according to theoretical expectations such an arrangement is both inefficient and inequitable a pre modern or pre capitalist productive relationship which will inevitably yield to a pattern of fixed rents and wage labour here the role of abusa in the spectacular growth of the cocoa economy and in its recent decline is examined with reference to the development of individual contracts it is argued that this ontogenetic development of abusa is structured by the changing domestic circumstances of farm owner and farm worker their competing interests in a maturing cocoa farm are negotiated and expressed in a sequence of contractual arrangements which gives the worker increasing access to the land and the product of his own labour it is suggested that if the evolution of productive relations towards more evidently capitalist

managed care s price bargaining with hospitals research has shown that managed care mc slowed the rate of growth in health care spending in the 1990s primarily via lower unit prices paid however the mechanism of mc s price bargaining has not been well studied this article uses a unique panel dataset with actual hospital prices in massachusetts between 1994 and 2000 to examine the sources of mc s bargaining power i find two significant determinants of price discounts first plans with large memberships are able to extract volume discounts across hospitals second health plans that are more successful at channeling patients can extract greater discounts patient channeling can add to the volume discount that plans negotiate

do labor market opportunities affect young women s work and family decisions experimental evidence from india do labor market opportunities for women affect marriage and fertility decisions we provided three years of recruiting services to help young women in randomly selected rural indian villages get jobs in the business process outsourcing industry because the industry was so new at the time of the study there was almost no awareness of these jobs allowing us in effect to exogenously increase women s labor force opportunities from the perspective of rural households we find that young women in treatment villages were significantly less likely to get married or have children during this period choosing instead to enter the labor market or obtain more schooling or postschool training women also report wanting to have fewer children and to work more steadily throughout their lifetime consistent with increased aspirations for a career copyright 2012 oxford university press

aid policies and growth the authors of this paper use a new database on foreign aid to examine the relationships among foreign aid economic policies and growth of per capita gdp in panel growth regressions for 56 developing countries and 6 four year periods 1970 93 they find that the policies that have a great effect on growth are those related to fiscal surplus inflation and trade openness they construct an index for those three policies and have that index interact with foreign aid they have instruments for both aid and aid interacting with policies they find that aid has a positive impact on growth in developing countries with good fiscal monetary and trade policies in the presence of poor policies aid has no positive effect on growth this result is robust in a variety of specifications which include or exclude middle income countries include or exclude outliers and treat policies as exogenous or endogenous they examine the determinants of policy and find no evidence that aid has systematically affected policies either for good or for ill they estimate an aid allocation equation and show that any tendency for aid to reward good policies has been overwhelmed by donors pursuit of their own strategic interests in a counterfactual they reallocate aid reduce the role of donor interests and increasing the importance of policy such a reallocation would have a large positive effect on developing countries growth rates

incentives work getting teachers to come to school we use a randomized experiment and a structural model to test whether monitoring and financial incentives can reduce teacher absence and increase learning in india in treatment schools teachers attendance was monitored daily using cameras and their salaries were made a nonlinear function of attendance teacher absenteeism in the treatment group fell by 21 percentage points relative to the control group and the children s test scores increased by 0 17 standard deviations we estimate a structural dynamic labor supply model and find that teachers respond strongly to financial incentives our model is used to compute cost minimizing compensation policies jel i21 j31 j45 o15

the future of personnel economics personnel economics is defined as the application of microeconomic principles to human resources issues that are of concern to most businesses the field now about 20 years old arose for three reasons first those of us who were teaching standard labour economics to business students encountered a disinterested audience business students believe that labour supply and demand unemployment investment in education and other topics which are of primary concern to labour economists are almost irrelevant to their future business careers their boredom with what we had to sell signalled that a change in the product might be warranted second the issues studied by human resources specialists were of interest to economists but the approach taken by the non economist was unsatisfying it was loose unfocused and ad hoc and lacked the general rigorous framework to which economists have grown accustomed the economist s reaction was to enter an industry where it was believed rents existed third the technology of economics changed as a result of some breakthroughs particularly those dealing with agency and contract theory economists were better equipped to tackle problems that had evaded them in the past

contractual structure in agriculture abstract this paper develops a generalized double sided moral hazard model of contract choice in agricultural production with mutual monitoring of each other by the landlord and the tiller who generally have different levels of farming efficiency and are risk averse using this model we formally prove that the optimal contract maximizes the output net of the risk bearing and agency costs of both the parties and carry out a simulation exercise which helps explain many of the tenancy related issues the difference in the farming efficiency of the two sides often ignored in previous analysis turns out to be the principal determinant of the contract offered to a tiller

when the money runs out do cash transfers have sustained effects on human capital accumulation this study examines the medium term effects of a two year cash transfer program targeted to adolescent girls and young women significant declines in hiv prevalence teen pregnancy and early marriage among recipients of unconditional cash transfers ucts during the program evaporated quickly two years after the cessation of transfers however children born to uct beneficiaries during the program had significantly higher height for age z scores at follow up on the other hand conditional cash transfers ccts offered to out of school females at baseline produced a large increase in educational attainment and a sustained reduction in the total number of births but caused no gains in health labor market outcomes or empowerment the findings point to both the promise and the limitations of cash transfer programs for sustained gains in welfare among young women

school subsidies for the poor evaluating the mexican progresa poverty program abstract this paper evaluates how the progresa program which provides poor mothers in rural mexico with education grants has affected enrollment poor children who reside in communities randomly selected to participate in the initial phase of the progresa are compared to those who reside in other control communities pre program comparisons check the randomized design and double difference estimators of the program s effect on the treated are calculated by grade and sex probit models are also estimated for the probability that a child is enrolled controlling for additional characteristics of the child their parents local schools and community and for sample attrition to evaluate the sensitivity of the program estimates these estimates of program short run effects on enrollment are extrapolated to the lifetime schooling and the earnings of adults to approximate the internal rate of return on the public schooling subsidies as they increase expected private wages

tenancy and family resources a model and some empirical analysis abstract in this paper we discuss with the help of a simple model the role of family resource endowments in determining the extent of land leased in or leased out by a household this becomes important when the market for some of these resources is either not functioning at all or is functioning imperfectly we focus on three such resources which have some relevance in indian agriculture these are 1 the family s managerial skill 2 its endowment of human labour and 3 its endowment of draft animal labour household level data from six villages of maharashtra and andhra pradesh are also utilized to test some of the hypotheses

credit and sharecropping in agrarian societies this paper considers a model of linkage between land labor and credit transactions in the context of sharecropping the paper s objectives are a to derive and characterize the equilibrium in a model of a land scarce labour abundant economy under sharecropping given an infinitely elastic supply of identical sharecroppers at a reservation utility and b to demonstrate that in an imperfect market a landlord may offer credit to his tenant sometimes even at a subsidized rate of interest without necessarily insisting that the sharecropper borrow only from him precluding an involuntary linkage between credit and land transations it has been demonstrated that regardless of the presence or absence of linkage or any other control by the landlord as long as he can vary the size of the plot given to a tenant and there are enough potential tenants in equilibrium contracts a tenants utility under sharecropping will be the same as that which he could have obtained as a full time wage laborer this result implies that policies other than land reform will not affect the welfare of tenants

what explains the stagnation of female labor force participation in urban india female labor force participation rates in urban india between 1987 and 2011 are surprisingly low and have stagnated since the late 1980s despite rising growth fertility decline and rising wages and education levels married women s labor force participation hovered around 18 percent analysis of five large cross sectional micro surveys shows that a combination of supply and demand effects have contributed to this stagnation the main supply side factors are rising household incomes and husband s education as well as the falling selectivity of highly educated women on the demand side the sectors that draw in female workers have expanded least so that changes in the sectoral structure of employment alone would have actually led to declining participation rates

monopoly monopsony and contestability in health insurance a study of blue cross plans i introduction blue cross and blue shield plans the plans have historically occupied a unique niche in health care pauly 1987 notes that the plans serve both as sellers of health insurance and as buyers of health services marmor 1991 described the plans development of health insurance concepts in the 1930s their role as innovators permitted them to occupy a dominant market share position in most geographic areas as a result blair ginsburg and vogel 1975 believe they have traditionally received favorable regulatory treatment including non profit organization status and exemption from taxation potentially the plans have dual market power 1 monopoly power in the market for health insurance and monopsony power in the market for health services this may result in operating inefficiencies and may produce adverse welfare consequences monopsony theory posits that the plans will reduce payments to providers and may stifle innovation in the market for health services this occurs as the result of the plans dominant market shares generated from the fact that they were often the first in the market for insurance and from their ability to enforce a credible threat to reduce providers business should providers refuse to provide reduced cost services the plans dominant market share and their advantage in the market for health services permit them to maintain a competitive advantage in the market for health insurance 2 monopoly theory suggests that the plans advantage in the market for medical services due to regulatory and tax advantages will cause them to i raise premium prices ii sell only a limited range of health insurance policies iii offer policies with more complete coverage than consumers demand 3 iv reduce innovation in the health insurance market and v demonstrate unduly high administrative costs in the 1970s empirical work supported these predictions however the 1980s has been an era of growth of competition and the potential for even more competition in the market for health insurance baumol panzar and willig 1982a noted that a credible threat of entry can produce competitive market conditions in a concentrated market resulting in reduced prices increased quantity and more efficient administrative cost structures if pauly is correct that there are no inherent scale economies in the health insurance market and if the market for health insurance is contestable the plans will pass advantages along to subscribers as reduced premiums and will tolerate fewer administrative cost inefficiencies accordingly the plans present an opportunity to study market structure and its impact in both the market for health care and the market for health care insurance to date no study has evaluated this interplay greater understanding of these interactions is important not only to deal with the phenomena of the plans for instance more appropriate regulatory policies but also to refine the single payer debate and to consider operating standards for health alliances and health plans included in the administration s health care reform package outlined by the white house domestic policy council 1993 section ii of this paper evaluates prior studies of the plans section iii motivates the model for plan behavior section iv describes the results of our empirical study of the plans premium pricing provider payment and administrative costs section v contains our conclusions ii prior studies of plan behavior a number of prior studies have evaluated the plans unique position in the market for health insurance and in the market for health care most focus on the plans monopsony power and payments to providers most important they evaluate markets that have gone through substantial change as health maintenance organizations and preferred provider organizations hmos and ppos have replaced fee for service plans several assess market power and administrative costs

two tier land tenure system and sustained economic growth in post 1978 rural china abstract the two tier land tenure system has been widely blamed for the problems in land allocation and in land specific investment observed in the postreform rural china greater privatization of property rights in land has been proposed to enable productive farmers to acquire more land to promote land circulation to improve farmers access to credit and to encourage farm investment it is argued here that in the presence of multiple market distortions land privatization is unlikely to provide a solution to the agricultural problems rather an approach which refines the existing framework of the two tier ownership system offers more promise

participation in rural land rental markets in sub saharan africa who benefits and by how much evidence from malawi and zambia we use nationally representative household level panel survey data in two neighboring countries in southern africa zambia and malawi to characterize the current status of rural land rental market participation by smallholder farmers and their subsequent welfare impacts rural rental market participation is much higher in densely populated malawi than in lower density zambia reflecting the role of land scarcity in driving rental market development consistent with previous literature we find evidence that rental markets contribute to efficiency gains within the smallholder sector by facilitating the transfer of land from less able to more able producers on average in both countries furthermore we find that rental markets serve to re allocate land from relatively land rich to land poor households we examine the impacts of participation on a number of welfare outcomes and find evidence for generally positive returns to renting in land in both countries on average however our analysis also indicates that the returns to renting in land vary strongly with scale of production tenants who produce more have larger returns to renting in and many of the smaller producers who rent in do so at an economic loss the impacts of renting out i e participating in markets as landlords are decidedly more mixed with overall negative returns to landlords in malawi and negligible returns to landlords in zambia the findings in this article highlight the need for researchers and policymakers in sub saharan africa to stay attuned to how land rental market participation and its impacts evolve in the near future

price support acreage controls and efficient redistribution this study is concerned with the combination of target price and acreage controls as the two major mechanisms of farm policy acreage controls are shown to enhance the efficiency of redistribution under a target price program more specifically this study demonstrates that if the traditional cobb douglas production function is assumed acreage controls do not enhance the efficiency of target price programs in the process of redistributing income to the farm sector the study proves that if the elasticity of substitution between land and all other inputs is less than one then the income redistributional costs are likely to be reduced moreover by using an empirical estimate of the elasticity of substitution and farm data for the time period 1984 88 this study demonstrates that acreage control programs have drastically reduced the deadweight losses associated with income redistribution flowing from target price programs these results lend strong support to the public choice notion that politicians favo

land distribution and international agricultural productivity the unequal distribution of agricultural land is often cited as a source of inefficiency in agriculture previous cross country studies of agricultural productivity differences though have not considered land inequality this article addresses this issue by using cross country data on inequality in operational holdings of agricultural land from deininger and squire 1998 in an estimation of an agricultural production function the gini coefficient for land holdings is found to have a significant negative relationship with productivity this is consistent with the existence of heterogeneity in productivity by farm size within countries a one standard deviation drop in the gini coefficient implies an increase in productivity of 8 5

hospital investment decisions and the cost of capital this study addresses two issues conceptually and empirically how does hospital ownership type affect hospital investment choices how do differences in the way hospitals are paid cost versus charge based reimbursement affect hospital investment the authors compute cost of capital measures for both for profit and not for profit hospitals whether or not hospital dependence on cost based payment stimulates investment depends on the generosity of such payment relative to the economic cost of capital empirically they find that for profit hospital exit entry decisions are guided by the generosity of payment to a greater extent than the not for profits copyright 1989 by the university of chicago

the administrative costs of non profit health insurers interest in the efficiency or inefficiency of non profit firms has spawned research on the administrative costs of blue cross and blue shield plans relying on plausible implications of the property rights theory of the firm both blair ginsburg and vogel 1975 and vogel 1977 noted some evidence of inefficiency in these firms our analysis however utilizing their models and more recent data reveals little convincing evidence for the view that blue shield plans are inefficient

contestability vs competition analyzes the ultra free entry as normative contribution to industrial organization ultra free entry in context of the evolving field of industrial organization assessment of the conceptual validity of william baumol elizabeth bailey john panzar and robert willig s analysis in representing the nature of competition empirical issues in measuring and testing ultra free entry ebsco

sharecropping and the interlinking of agrarian markets one of the often noted features of less developed agrarian economies is the existence of interlinkages among the land labor credit and product markets the landlord is often the supplier of credit he frequently purchases and markets the output of the tenant farmers and often sells raw materials and even consumption goods to his tenant farmers how can this phenomenon be explained what are the welfare consequences of attempts to restrict these practices which often seem to constitute restraints on free trade these are the questions to which this paper is addressed a general set of arguments applicable to both competitive and noncompetitive environments are presented to situations where all the terms of the contract are determined in an optimal way as well as to situations where many of the terms are specified institutionally section i examines interlinked credit and tenancy contracts section ii examines interlinked marketing and tenancy contracts section iii points out the possible interlinking between labor contracts and consumption goods markets and section iv presents the different equilibrium frameworks discussed in the paper such as monopoly monopsony competition and equilibria with surplus labor

do it service centers promote school enrollment evidence from india abstract globalization has changed job opportunities in much of the developing world in india outsourcing has created a new class of high skill jobs which have increased overall returns to schooling existing evidence suggests education may broadly respond to this change we use microdata to evaluate the impact of these jobs on local school enrollment in areas outside of major it centers we merge panel data on school enrollment from a comprehensive school level administrative dataset with detailed data on information technology enabled services ites center location and founding dates using school fixed effects we find that introducing a new ites center causes a 5 increase in the number of children enrolled in primary school this effect is localized to within a few kilometers we show the effect is driven by english language schools consistent with the claim that the impacts are due to changes in returns to schooling and is not driven by changes in population or income resulting from the ites center supplementary survey evidence suggests that the localization of the effects is driven by limited information diffusion

small fields big money two successful programs in helping small farmers make the transition to high value added crops abstract this paper compares two successful programs one in present day thailand and one in taiwan during the 1960s in which small rice farmers were helped to make the transition to growing high value added horticultural crops during the off season the key to the success of both programs appears to have been the flexible and creative interplay between government and the private sector of special interest to the debate over the proper role of government in furthering development is taiwan s planned production and marketing system where officials consulted with industry and set mandatory production quotas which were allocated to each township and cannery

competition between non profit and for profit health insurers this study investigates the effects of tax regulatory and reimbursement policies and other factors exogenous to the health insurance market on the relative price to commercial insurers paid by blue cross plans for hospital care their administrative expense and accounting profits premiums and ultimately blue cross market share we specify and estimate a simultaneous equation model to assess interrelationships among these variables we conclude that premium tax advantages enjoyed by the blues have virtually no effect on the blues premiums or their market shares a blue cross plan s market share has a positive effect on the discount it obtains from hospitals as does coverage of blue shield charges by a state mandated rate setting plan an upper bound on the effect on the blue cross market share of covering blue cross under rate setting but excluding the commercials from such coverage is seven percentage points tests for administrative slack in the operation of blue cross plans yield mixed results

the effects of market structure and bargaining position on hospital prices ppos and hmos have gained widespread acceptance due in part to the belief that excess capacity and competitive market conditions can be leveraged to negotiate lower prices with health care providers we investigated prices obtained in different types of markets by the largest ppo in california our findings indicate that greater hospital competition leads to lower prices furthermore as the importance of a hospital to the ppo in an area increases the price rises substantially our testing of alternative methods for defining hospital geographic markets reveals that the common practice of using counties to define the market leads to an underestimate of the price increasing effects of a merger

credit and land contracting a test of the theory of sharecropping author s das n de janvry a sadoulet e abstract 2019 the author s 2019 published by oxford university press on behalf of the agricultural and applied economics association all rights reserved for permissions please email journals permissions oup com choice of a share vs fixed rent land rental contract has figured prominently in the theory of industrial organization this theory tells us that while a share contract is inefficient in a first best world it may be the preferred option under second best conditions it has thus predicted the existence of sharecropping as the potentially preferred contract under conditions of liquidity constraint rigorous empirical evidence is however still lacking on this basic contribution of theory we use a randomized experiment in a credit program for landless workers and marginal farmers organized by brac in bangladesh to show that increased access to credit has a large positive effect on the choice of fixed rent over share rent contracts both in terms of number of contracts and area contracted as predicted by theory the magnitude of this shift away from sharecropping is enhanced when the tenant is less exposed to risk development programs that facilitate access to credit to potential tenants can thus help them take more efficient land rental contracts

limited liability wealth differences and tenancy contracts in agrarian economies abstract an explanation is provided for two observations concerning variations in the choice of tenants and their welfare differences in tenants wealth imply corresponding differences in liability when default is possible on fixed rental commitments in this context the inability of landlords to specify their tenants effort lead to effort choices that vary with the type of contract offered the selection of tenants and the contract terms they receive thus depend on wealth with wealthier tenants being preferred and receiving fixed rent contracts these results also predict that wealthier tenants earn higher profits on their leased plots

do landlord tenant relationships influence rental contracts for farmland or the cash rental rate a considerable portion of north america s farmland is rented out by nonfarmer landlords our survey of farmers in southern ontario canada provides a refined understanding of who these landlords are and whether variations in landlord tenant relationships influence rental contract choice and or the magnitude of cash rent we find that crop share arrangements are more likely to emerge among family relations however we do not find strong evidence that family relations explain variation in the magnitude of cash rental rates

schooling and labor market consequences of school construction in indonesia evidence from an unusual policy experiment between 1973 and 1978 the indonesian government engaged in one of the largest school construction programs on record combining differences across regions in the number of schools constructed with differences across cohorts induced by the timing of the program suggests that each primary school constructed per 1 000 children led to an average increase of 0 12 to 0 19 years of education as well as a 1 5 to 2 7 percent increase in wages this implies estimates of economic returns to education ranging from 6 8 to 10 6 percent

food insecurity income inequality and the changing comparative advantage in world agriculture i would like to argue in this article that in the process of economic development in land poor countries in asia agriculture faces three distinctly different problems food insecurity sectoral income inequality and the declining food self sufficiency associated with the declining comparative advantage in agriculture at the high income stage massive imports of food grains to asia if they occur will aggravate the world food shortage which will have significant implications for the poverty incidence in the world i argue that in order to avoid such a tragedy asia should expand farm size to reduce labor cost by adopting large scale mechanization sub saharan africa should realize a green revolution in grain production and latin america should further expand its grain production capacity

risk preferences and the economics of contracts t he literature of risk aversion and risk preference is one of the richest sources of ad hoc assumptions concerning tastes n o significant behavior has been illuminated by assumptions of differences in tastes such theories have been a convenient crutch to lean on when the analysis has bogged down they give the appearance of considered judgement yet really have only been ad hoc arguments that disguise analytical failures george j stigler and gary s becker 1977 p 89

the power of tv cable television and women s status in india cable and satellite television have grown rapidly throughout the developing world the availability of cable and satellite television exposes viewers to new information about the outside world which may affect individual attitudes and behaviors this paper explores the effect of the introduction of cable television on gender attitudes in rural india using a three year individual level panel dataset we find that the introduction of cable television is associated with improvements in womens status we find significant increases in reported autonomy decreases in the reported acceptability of beating and decreases in reported son preference we also find increases in female school enrollment and decreases in fertility primarily via increased birth spacing the effects are large equivalent in some cases to about five years of education in the cross section and move gender attitudes of individuals in rural areas much closer to those in urban areas we argue that the results are not driven by pre existing differential trends these results have important policy implications as india and other countries attempt to decrease bias against women authors

the agent agents problem payment by relative output this paper begins an investigation into the incentive problems at a firm when the effort of the employer and the employees combines to determine final output the major conclusion is that optimal reward functions in this circumstance will in general value the performance of a worker relative to that of his peers the paper thus joins a growing literature associated with the work of lazear and rosen on rank order tournaments

collective agricultural production a solution for transition economies abstract the paper examines theoretical reasons and provides examples for productivity differences between agricultural service cooperatives and collectives service cooperatives can utilize economies of scale enhance competitiveness and provide technical information advantages that often outweighed problems of free riding low investment and excessive political intervention agricultural collectives while not adding substantial advantages are in addition associated with problems of supervision and effort supply tendencies to substitute casual workers or mechanization for regular members and low investment incentives while collective forms of organization in transition economies respond to high risk and market imperfections they do so inefficiently policies that create conditions for service cooperatives to compete may lead to large productivity gains

hospital profits the effects of reimbursement policies this paper provides a theoretical and empirical analysis of the effect of cost based reimbursement cbr on hospital costs and charges it takes issue with previous analyses which have treated cbr as paying economic costs plus a mark up and have concluded that the mark up is too small to significantly distort hospital decision making the basic thesis here is that if reimbursement is based on costs accounting costs become a price to cost paying patients and will be optimized to maximize revenue a hospital serving both cost and charge paying private patients can set two price schedules accounting profits ratio of charges to costs are not a measure of economic profit but of relative prices to these two groups of patients in the absence of constraints from regulation or patient co payment the optimum level of accounting costs would be infinite in practice the medicare reimbursement formula links allowable costs to charges received from charge paying patients this formula creates incentives for the hospital to raise charges above the single price profit maximizing monopoly level this inflationary effect of the medicare formula does not presuppose that medicare pays less than full cost the empirical analysis of hospital laboratory costs and charges generally supports the predictions for other departments the conclusions are consistent but more tentative because of data limitations overall evidence suggests minimal cross subsidy between cost and charge paying patients comparisons of cost and charge levels in for profit voluntary non profit and government hospitals are presented but it is emphasized that inferences about relative efficiency and profitability cannot be drawn from accounting data given the incentives created by cbr

consumption smoothing migration and marriage evidence from rural india a significant proportion of migration in low income countries particularly in rural areas is composed of moves by women for the purpose of marriage we seek to explain these mobility patterns by examining marital arrangements among indian households in particular we hypothesize that the marriage of daughters to locationally distant dispersed yet kinship related households is a manifestation of implicit interhousehold contractual arrangements aimed at mitigating income risks and facilitating consumption smoothing in an environment characterized by information costs and spatially covariant risks analysis of longitudinal south indian village data lends support to the hypothesis marriage cum migration contributes significantly to a reduction in the variability of household food consumption farm households afflicted with more variable profits tend to engage in longer distance marriage cum migration the hypothesized and observed marriage cum migration patterns are in dissonance with standard models of marriage or migration that are concerned primarily with search costs and static income gains

college entry by blacks since 1970 the role of college costs family background and the returns to education college enrollment of black 18 19 year old high school graduates declined from 1980 through 1984 and then rebounded after 1984 this paper presents data from a time series of cross sections of 18 19 year old youths from 1973 through 1988 to test the role of family background direct college costs local economic conditions and returns to college in driving these trends the evidence suggests that on the one hand increases in direct college costs were driving enrollment rates downward throughout the eighties on the other hand dramatic increases in average parental education for black youths exerted upward pressure on college enrollment by blacks particularly in the latter half of the decade the net effect of these two factors contributed to the pattern of decline and recovery observed during the eighties

market share and the illusion of power can blue cross force hospitals to discount researchers in health care financing have claimed that large private insurers like blue cross frequently exercise monopsony power to obtain discounts from normal hospital charges they claim that the monopsony power derives from a large blue cross share of a given hospital cost shifting whereby hospitals offset the discount by raising charges to less powerful customers this paper re examines both theoretically and empirically the conditions necessary for a private insurer to extract discounts from a hospital we demonstrate that the theoretical conditions necessary for blue cross to force a discount do not exist in the indiana market using revenue data from 110 indiana hospitals we reject the traditional claim that blue cross pays less than other insurers as a function of market share