what determines the duration of a fiscal consolidation program abstract this paper assesses the determinants of the length of fiscal consolidation using annual data for 17 industrial countries over the period 1978 2009 relying on a narrative approach to identify fiscal consolidation episodes we show that fiscal variables such as the budget deficit and the level of public debt and economic factors such as the degree of openness the inflation rate the interest rate and per capita gdp are crucial for the fiscal consolidation process additionally we employ duration analysis over a set of consolidation spells and find that as time goes by the likelihood of a fiscal consolidation ending is higher however the hazard function is not monotonic indeed it increases until the eighth or ninth year and starts decreasing afterwards we also find that i spending driven consolidations are shorter than tax driven consolidations ii both types of consolidation are longer in non european countries than for european countries and iii the size of the consolidation program in percentage of gdp does not significantly affect duration all in all our results support the importance of cuts in government spending as a way of bringing economies into a sustainable path for public debt moreover they highlight the role played by a fiscal framework that imposes discipline in governments as a device to credibly shorten the length of fiscal consolidation episodes

school choice programs and location choices of private schools this paper studies how the school choice policies that subsidize private school attendance using public funds affect the spatial distribution of private schools in the united states private school choice programs enacted between 1997 and 2010 are examined and linked to private school provision 2 years later the paper finds that school choice policies lead to more private schools where the input to public schools is lower and the pool of students with special needs is larger yet the introduction of means tested school choice programs does not necessarily lead private schools to locate in low income neighborhoods jel i2 h4 r3

do better schools matter parental valuation of elementary education the evaluation of numerous school reforms requires an understanding of the value of better schools given the difficulty of calculating the relationship between school quality and student outcomes i turn to another method and use house prices to infer the value parents place on school quality i look within school districts at houses located on attendance district boundaries houses then differ only by the elementary school the child attends i thereby effectively remove the variation in neighborhoods taxes and school spending i find that parents are willing to pay 2 5 percent more for a 5 percent increase in test scores this finding is robust to a number of sensitivity checks

valuing english primary schools this paper provides the first empirical evidence for the uk on the effect of primary school performance on property prices we find that on average a one percentage point increase in the neighbourhood proportion of children reaching the government specified target grade pushes up neighbourhood property prices by 0 67 at 2000 property prices we calculate the social valuation of a sustained 1 improvement in primary school performance to be up to 90 per child per year our instrumental variable and semi parametric approach avoids the problems of school quality endogeneity and omitted neighbourhood variables that occur in typical property value models

agriculture in recent development theory abstract this paper is a critical review of recent contributions to the literature on agriculture in development theory it considers and compares the main lines of advance made within neoclassical neo marxian and structuralist approaches recent neo marxian and structuralist studies of agrarian development reveal that traditional agriculture is neither stationary nor efficient that resource allocation cannot be separated from wealth distribution or production organization that forms of surplus appropriation do not necessarily follow the dictates of efficiency that the social relations of production may inhibit accumulation and determine the forms of technological change that the state s role in primitive accumulation is more economic than explicitly coercive political and that political and macroeconomic constraints preclude a simple get the prices right view of the intersectoral terms of trade the thrust of these developments is to challenge both neoclassical and some orthodox marxian formulations of agrarian development issues and add to the insights to be gleaned from a political economy of development

house prices and the provision of local public services capitalization under school choice programs abstract while the theoretical public finance literature argues that house prices should be influenced by the demand for local public services there is little direct evidence concerning changes in house prices when these services are altered previous empirical studies have relied on cross sectional identification of the relationship between house prices and variables that may proxy for the perceived quality of local public services this paper instead examines a policy change the adoption of a public school choice program to identify the capitalization effects associated with the diminished importance of school district boundaries using data from inter district choice in minnesota i find that residential properties appreciate significantly in school districts where students are able to transfer to preferred school districts whereas residential property values decline in districts that accept transfer students these general equilibrium effects also influence school districts local property tax revenues mitigating the incentive for schools to improve in order to attract or retain students

valuing school quality using boundary discontinuities abstract existing research shows that house prices respond to local school quality as measured by average test scores however higher test scores could signal higher academic value added or higher ability more sought after intakes in our research we show that both school value added and student prior achievement linked to the background of children in schools affect households demand for education in order to identify these effects we improve the boundary discontinuity regression methodology by matching identical properties across admissions authority boundaries by allowing for boundary effects and spatial trends by re weighting our data towards transactions that are closest to district boundaries by eliminating boundaries that coincide with major geographical features and by submitting our estimates to a number of novel falsification tests our results survive this battery of tests and show that a one standard deviation change in either school average value added or prior achievement raises prices by around 3

school board politics school district size and the bargaining power of teachers unions this paper presents a public choice theory of the bargaining power of teachers unions the theory predicts that the power of the unions rises with the size of a district the theory is tested by examining the relationship between district size and various bargaining outcomes for a sample of 771 california school districts in 1999 2000 as hypothesized teachers salaries rise and the ratio of teachers per pupil falls with increasing district size the paper also considers several alternative explanations for these results

capitalization and the theory of local public finance the tiebout literature is incomplete this paper argues because it has not fully accounted for the capitalization of local fiscal variables into house values the paper explains why capitalization arises why it persists in long run equilibrium how it affects both residential location and the outcome of local voting and why it interferes with the efficiency of a system of local governments the analysis which is based on the main tiebout assumptions plus a property tax combines a model of household bids in a housing market with a median voter model of local public service determination

debt and growth new evidence for the euro area abstract against the background of the euro area sovereign debt crisis our paper investigates the relationship between public debt and economic growth and adds to the existing literature in the following ways first we use a dynamic threshold panel methodology in order to analyse the non linear impact of public debt on gdp growth second we focus on 12 euro area countries for the period 1990 2010 therefore adding to the current discussion on debt sustainability in the euro area our empirical results suggest that the short run impact of debt on gdp growth is positive and highly statistically significant but decreases to around zero and loses significance beyond public debt to gdp ratios of around 67 this result is robust throughout most of our specifications in the dynamic and non dynamic threshold models alike for high debt to gdp ratios above 95 additional debt has a negative impact on economic activity furthermore we can show that the long term interest rate is subject to increased pressure when the public debt to gdp ratio is above 70 broadly supporting the above findings

self employment and self selection in developing country labor markets labor markets in less developed countries ldcs have traditionally been characterized as non competitive this view is expressed in well known models in the development economics literature for example the labor surplus model of lewis 16 asserts that labor in rural areas of ldcs in early stages of development is so abundant that if the wage rate were determined competitively it would be below the subsistence level hence institutions are assumed to arise to determine the wage rate non competitively and to provide the resulting excess supply of labor to agriculture with a subsistence level of living the harristodaro 11 model of rural urban migration asserts that labor unions minimum wage laws public sector hiring practices and other institutional factors tend to keep formal sector wages in urban areas above labor market clearing levels the resulting excess supply of labor in urban areas is assumed to survive at a subsistence level by becoming selfemployed in the low productivity informal sector recent empirical studies provide little support for the non competitive view of ldc labor markets evidence from india thailand malaysia kenya and guatemala suggests that labor markets are much less imperfect than often assumed an important empirical finding in several of these studies is that self employed workers appear to have higher earnings than their wage employee counterparts in urban areas 2 this fact is inconsistent with the notion that self employment is typically a low productivity occupation engaged in by individuals who are searching for scarce well paying formal sector jobs the purpose of this study is to analyze and estimate a model of individual choice between wage and self employment in the ldc context the model incorporates a production function in the self employment sector that includes managerial ability as an input analysis of the influence of managerial ability on the choice of self employment leads to a theory that can explain the observed pattern of earnings of the urban self employed compared to wage employees implications of the model for estimation of production function

fiscal policy in real time in this paper i estimate the ex ante or intentional cyclical stance of fiscal policy in oecd countries i use the fiscal plans reported at the time of budgeting together with other information available to fiscal policy makers in real time indeed fiscal plans might be significantly different from ex post outcomes because governments do not have complete control over their implementation which is influenced by several exogenous factors when fiscal policy rules are estimated using real time data i show in this paper that oecd countries have often planned a counter cyclical fiscal stance especially during economic expansions this contrasts with conventional findings based on actual data which tend to point towards a cyclicality or pro cyclicality forecast errors for the government structural balance and the output gap play a central role in explaining the differences between estimates based on ex ante and ex post data

financial markets shutdown and reaccess we employ a discrete time parametric duration model on a group of 121 countries over the period 1970 2011 and find that the probability of the end of financial markets shutdown and reaccess falls as these events become longer we also show that 1 shutdown episodes are longer when economic prospects are poor and the degree of financial openness falls the chief executive has been in office for long periods and the country has a default history and 2 spells of reaccess tend to be longer when economic growth improves and financial openness increases there are neither government crises nor government instability and the country did not default in the past jel c41 g15

seasonal adjustment in a market for female agricultural workers this article explores seasonal adjustment in the market for temporary agricultural labor we estimate a model of participation allowing for unobserved heterogeneity and endogeneity selection bias using daily observations from chilean panel data and a model of daily earnings results indicate that seasonal wage variation is an important aspect of labor market adjustment contributing to a large change in labor force participation the labor force participation rate of women is significantly more elastic to changes in the expected wage than is that for men nonetheless we find evidence of substantial open unemployment during the slack season especially for females probably due to frictional and efficiency wage effects

school district and housing price responses to fiscal stress labels evidence from ohio abstract this paper examines the effect of the ohio fiscal stress labeling system on school district outcomes and housing prices under this policy financially troubled districts are labeled and required to implement financial recovery plans in response to these plans districts increase local tax revenues and decrease capital and operating expenditures although these recovery plans lead to better long term financial health for school districts there appear to be some negative impacts on welfare in these districts during the duration of the label i find that residential home sale prices fall following fiscal stress label receipt but rise again once the label is removed these districts also undergo substantial restructuring including reductions in enrollments teachers and schools which coincide with a transitory reduction in math proficiency rates following label receipt

fiscal policy and monetary integration in europe fiscal policy economists policy makers and the media often argue that the maastricht treaty and the stability and growth pact make it difficult for governments of emu countries to stabilize their economies with appropriate fiscal policy and to provide adequate public investment our empirical analysis offers little support to this view discretionary budget deficits have actually become more counter cyclical in emu countries after the maastricht treaty as well as in the other eu and non eu industrialized countries we study and while public investment has declined recently in emu countries a similar tendency is apparent in other countries and started well before the maastricht treaty was signed jordi gali and roberto perotti

schools and housing markets an examination of school segregation and performance in connecticut this paper estimates a dynamic model of price level school performance and school racial and ethnic composition in the state of connecticut the paper finds that increasing minority representation in a labor market area reinforces the existing pattern of school segregation changes in segregation appear to be influenced by demographic trends in urban areas and by the labour market factors that determine those trends there is no evidence however to suggest that this process affects housing prices rather the housing market appears to adjust relatively quickly

access to capital and agrarian production organisation there are two problems both universal that entrepreneurs in any economy must contend with firstly an agent generally has access only to a limited amount of working capital secondly workers hired by an agent are subject to moral hazard and this necessitates their supervision this paper models for an agrarian economy the constraints imposed on entrepreneurs activities by these two problems and endogenously determines the various organisational forms of production as well as the allocation of resources that will obtain with a simple model we endeavour to explain a diverse set of empirical observations pertaining to the less developed countries in terms of the general processes that determine the distribution of income among the various agents and the hierarchical relationships that develop among them agricultural production typically involves a period of several months between the time the inputs are purchased and the time the output is marketed access to working capital and hence to the credit market thus plays an important role in a farmer s production decisions the distribution of access to credit in turn tends to be an important determinant of income distribution in poor agrarian economies credit is invariably rationed according to the ability to offer collateral the amount of working capital a farmer can mobilise therefore depends on the amount of land he owns which is often a good proxy for his overall wealth and thus his ability to offer collateral further since hired hands have a propensity to shirk they need to be supervised and therefore the

returns to education a further international update and implications this paper updates evidence on the returns to investment in education by adding estimates for new countries and refining existing estimates to bring the total number of country cases to over 60 the new cross country evidence confirms and reinforces earlier patterns namely that returns are highest for primary education the general curricula the education of women and countries with the lowest per capita income the findings have important implications for directing future investment in education which for efficiency and equity purposes should concentrate on these priority areas

housing demand and community choice an empirical analysis abstract housing demand reflects the household s simultaneous choice of the neighborhood whether to own or rent the dwelling and the quantity of housing services demanded existing literature emphasizes the final two factors but overlooks the choice of community this paper develops an econometric model that incorporates all three components and then estimates this model using a sample of tampa florida households incorporating community choice increases the price elasticity of demand and reduces the differential between white and comparable nonwhite households the results are robust to the inclusion of permanent income and taxes

reassessing discretionary fiscal policy in 1992 president bush proposed legislation intended to speed up the recovery from the 1990 91 recession congress rejected this proposal for countercyclical fiscal policy stimulus in early 1993 president clinton proposed his own stimulus package but congress rejected this proposal too many reasons were given for deciding against these two discretionary fiscal policy proposals but perhaps the most common one was the large federal budget deficit in the early 1990s with the rapid disappearance of budget deficits in recent years this reason to vote against a discretionary fiscal stimulus is unlikely to be mentioned in the next economic cycle discretionary countercyclical fiscal policy again appears to be a politically feasible option but should america use it after so many years of disuse much has happened in macroeconomics since the 1960s and 1970s when discretionary countercyclical fiscal policy was last considered a serious option in the united states first monetary policy making has changed substantially over the last two decades the federal reserve s interest rate decisions have become more explicit more systematic and more reactive to changes in both inflation and output the fed has placed a greater emphasis on keeping inflation low the experience with this new policy has been very favorable inflation has been low since the early 1980s and the real economy has been more stable the 1980s and 1990s saw two lengthy expansions separated by a relatively short and mild recession in terms of the tradeoff between output variability and inflation

monetary policy rules based on real time data this paper examines the magnitude of informational problems associated with the implementation and interpretation of simple monetary policy rules using taylor s rule as an example i demonstrate that real time policy recommendations differ considerably from those obtained with ex post revised data further estimated policy reaction functions based on ex post revised data provide misleading descriptions of historical policy and obscure the behavior suggested by information available to the federal reserve in real time these results indicate that reliance on the information actually available to policy makers in real time is essential for the analysis of monetary policy rules

fiscal policy in central and eastern europe with real time data cyclicality inertia and the role of eu accession this article evaluates the cyclicality inertia and effect of eu accession on fiscal policy in central and eastern europe cee using a real time dataset budget balances are found to react in a stabilizing way to economic activity every extra percentage point of economic growth is associated with an improvement in the budget balance of 0 3 percentage points of gross domestic product gdp and there is no evidence of an asymmetric reaction to the cycle balances are much less inert than is typically found in western europe however there is clear evidence of a fiscal loosening in the run up to eu accession this began in 1999 in larger central european countries often identified as front runners the other seven began loosening in 2001 after the nice treaty was agreed for both sets of countries this loosening cumulatively amounts to some 3 of gdp

the demands for funds by agricultural households evidence from rural india this study presents estimates of borrowing functions based on rural household data for india it improves upon existing work in three key areas first it is shown that existing studies have used an inappropriate definition of the demand for funds which when rectified produces quite different results second the interaction between agricultural technical change and the rural finance market is examined and it is shown that farmers in a position to benefit from technical change tend both to borrow more and to face lower interest rates third it is shown that farm specific interest rates when introduced endogenously are quite sensitive to personal and locational characteristics and are significant determinants of borrowing

real time data and fiscal policy analysis a survey of the literature abstractthis paper surveys the empirical research on scal policy analysis based on real timedata this literature can be broadly divided in three groups that focus on 1 the statisticalproperties of revisions in scal data 2 the political and institutional determinants of scaldata revisions and of one year ahead projection errors by governments and 3 the reactionof scal policies to the business cycle it emerges that rst scal data revisions are largeand initial releases are biased estimates of nal values second the presence of strong scalrules and institutions leads to relatively more accurate releases of scal data and smalldeviations of scal outcomes from government plans third the cyclical stance of scalpolicies is estimated to be more counter cyclical when real time data are used instead ofex post data finally more work is needed for the development of real time datasets for scalpolicy analysis in particular a comprehensive real time dataset including scal variablesfor industrialized and possibly developing countries published and maintained by centralbanks or other institutions is still missing

the desegregating effect of school tracking this paper makes the following point detracking schools that is preventing them from allocating students to classes according to their ability may lead to an increase in income residential segregation it does so in a simple model where households care about the school peer group of their children if ability and income are positively correlated tracking implies that some high income households face the choice of either living in the areas where most of the other high income households live and having their child assigned to the low track or instead living in lower income neighbourhoods where their child would be in the high track under mild conditions tracking leads to an equilibrium with partial income desegregation where perfect income segregation would be the only stable outcome without tracking

profits from self employment the case of cote d ivoire abstract in the past self employed workers were often viewed as less productive individuals yet recent research has indicated that the nonagricultural self employed fill a niche in the economy that large industry cannot the goods and services they produce may well be a necessary part of the infrastructure within which large scale industry can flourish this paper examines the productivity of nonagricultural family enterprises in cote d ivoire marginal returns to self employed labor are somewhat less than the wage rate of equivalent salaried workers capital yields extremely high returns in self employment possibly above 100 per month assuming limited access to credit the self employed may do well by establishing enterprises and gaining the large returns to capital that offset the somewhat lower returns to labor

can firms location decisions counteract the balassa samuelson effect this paper examines the determinants of relative prices in a model combining a harrod balassa samuelson hbs mechanism and an endogenous location of traded good producers besides the standard hbs effect asymmetric productivity improvements in the traded good sector push new firms to enter the market this benefits local consumers who save on trade costs and exerts an upward pressure on relative wages as a consequence relative prices in the traded good sector either increase or fall in general equilibrium in a panel cointegration framework the wage effect is shown to dominate this means the hbs effect is strengthened by the relocation of traded good producers

an oligopsonistic model of wage determination in agrarian societies the theory of rural wages in less developed countries is itself only partially developed three major explanations have been put forward but none of these can account for observed variations in nominal wages over time over regions and across individuals it is therefore time to take a fresh look at the problem and to develop new models which are more in accord with the data this task is undertaken in section ii where a model of heterogeneous labour is used to analyse rural labour markets and explain the wage payments system section i contains a brief summary of existing theory and its deficiencies in order to derive the main properties of the model quickly formal proofs of assertions are relegated to the technical appendix and most of the discussion of the assumptions and detailed explanations are left to section iii this section also contains general conclusions as well as a discussion of some of the more controversial issues

tiebout choice and universal school vouchers abstract this paper examines who is likely to gain and who is likely to lose under a universal voucher program following epple and romano d epple r e romano competition between private and public schools vouchers and peer group effects american economic review 88 1998 33 62 d epple r e romano neighborhood schools choice and the distribution of educational benefits in c m hoxby ed the economics of school choice the univ of chicago press chicago 2003 pp 227 286 and nechyba t j nechyba mobility targeting and private school vouchers american economic review 90 2000 130 146 t j nechyba introducing school choice into multidistrict public school systems in c m hoxby ed the economics of school choice the univ of chicago press chicago 2003 pp 145 194 we focus on the idea that gains and losses under a universal voucher depend on two effects changes in peer group composition and changes in housing values we show that the direction and magnitude of each of these effects hinge critically on market structure i e the amount of school choice that already exists in the public sector in markets with little or no tiebout choice potential changes in peer group composition create an incentive for high socioeconomic ses households to vote for the voucher and for low ses households to vote against voucher in contrast in markets with significant tiebout choice potential changes in housing values create an incentive for high ses households to vote against the voucher and for low ses households to vote for the voucher using data on vote outcomes from california s 2000 voucher initiative we find evidence consistent with those predictions

wage and employment effects of malawi s fertilizer subsidy program this article uses three waves of nationally representative household level panel data from malawi to estimate how a large scale fertilizer subsidy program impacts the agricultural labor market known as ganyu in that country i find that when looking across the entire population of smallholders receiving an additional 100 kg of subsidized fertilizer causes the average household to supply about three fewer days of ganyu the fertilizer subsidy program also has a small positive effect on the probability that a household demands agricultural labor with the results approaching statistical significance in addition a 10 kg increase in the average amount of subsidized fertilizer acquired per household in a community boosts the median agricultural wage rate by 1 4 in that community the increase in wage rates translates to a us 1 40 per year increase in average household income in the years after malawi s subsidy program was scaled up and a us 1 86 per year increase in average household income for those who sold their labor before the subsidy program was scaled up this finding suggests that households who sell their labor off farm may experience some small spillover benefit from the program in the form of higher agricultural wage rates

wage functions and occupational selection in a rural less developed country setting economists are just beginning to develop empirical knowledge about the basic relationships that determine the distribution of incomes and allocation of resources in the poor rural regions of the world understanding interactions between agriculture and the rest of the economy is particularly important in this context this paper empirically investigates the allocation of human resources between farm work and other jobs and the compensation received by individuals for their work in agriculture and elsewhere specifically two related tasks are undertaken in this paper 1 the estimation of wage functions and 2 the estimation of functions determining the allocation of time among occupations there have been a series of papers which estimate the earnings function using data from poor countries for examples see blaug 1974 chiswick 1977 and valdes 1971 however this study focuses not on total earnings but on the wage rates a person may earn in labor market work because the wage rate is the relevant price of time for many allocative decisions for example in dividing the work year between self employed farming and work as an employee off the farm a key price is the potential wage rate the person can earn in the labor market for discussion and evidence on this issue see sumner 1978 recently a few studies have appeared which illustrate the importance of understanding potential wage variations across individuals in less developed countries rosenzweig 1978 uses wage estimates from aggregate indian data in a model determining the impact of land reform bardhan 1979 develops wage functions from a sample survey in rural india as a step in estimating labor supply for rural households kusnic and davanzo 1980 use wage functions to impute potential incomes and to measure the full income distribution these previous studies illustrate the importance of understanding the determinants of market wages the present paper develops wage functions in more detail focusing especially on industrial differentials in many rural areas employment opportunities may be usefully categorized into 1 self employment mainly on small farms 2 work for wages on large farms and 3 work for wages in non farm industries the combination of selfemployment and work as an employee is also important in many rural areas in both rich and poor countries this paper examines the impact of personal characteristics on the choice to participate in work for wages and on the choice of industry these estimates also form a basis for studying industrial wage differentials tentative estimates of the dependence of participation on expected wages are also presented below the empirical analysis in this paper is based on a 1974 sample of five villages in central guatemala see corona 1978 and stein 1978 one village petapa is larger richer and more urban than the others it lies south of guatemala city within commuting distance of the capital the other villages are outside the capital city region the population sampled is almost exclusively ladino spanish culture as opposed to indian data are available on the earnings hours of work industry age schooling literacy and village of 1 005 male heads of households approximately one third of the sample work as both self employed farmers and hired workers and most of these men work on fincas large plantations another quarter of the sample work as self employed farmers and do no work for wages the suburban village has mostly nonagricultural workers whereas the four other villages have predominantly farmers and farm employees in received for publication june 21 1979 revision accepted for publication december 31 1980 north carolina state university research on this paper began while i was a rockefeller foundation supported post doctoral fellow in the labor and population group of the economics department of the rand corporation and continued at north carolina state university supported by the agricultural research service at rand robert newman served as my research assistant and at n c state james cochell provided able assistance i have benefited from the comments of colleagues at both institutions and from members of the labor economics workshop at the university of north carolina at chapel hill i also thank two anonymous referees for useful suggestions this is paper number 6558 of the journal series of the north carolina agricultural research service raleigh n c

hedonic markets and sorting equilibria bid function envelopes for public services and neighborhood amenities abstract hedonic regressions with house value as the dependent variable are widely used to study public services and neighborhood amenities this paper builds on the theory of household bidding and sorting across communities to derive bid function envelopes which provide a form for these regressions this approach allows for household heterogeneity and multiple amenities yields estimates of the price elasticity of amenity demand directly from the hedonic without a rosen two step procedure and provides tests of hypotheses about sorting an application to cleveland area data from 2000 yields price elasticities for school quality and neighborhood ethnic composition and supports the sorting hypotheses

government policies and graft in an economy with endogenous labor supply abstract this paper is an extension of marcouiller and young s am econ rev 85 1995 630 paper which shows that in a two good economy with constant labor supply the government can always increase graft by squeezing the formal sector out of existence in this paper we find that if individuals choose the amount of labor they supply the government can increase graft by eliminating formal production in relatively rare cases

land inheritance and market transactions in uganda studies on the role of nonmarket land transactions remain limited this paper addresses two questions is land inheritance driven by underdeveloped land markets how does land inheritance influence land disposal and acquisition we use a switching regression model on household data from rural uganda we find that the initially landless or near landless households due to little or no land inheritance obtain land through land markets while those that are land rich dispose of land through land sales and bequests the results suggest that a process of land equalization is unfolding within the sample

labor markets and poverty in village economies we study how women s choices over labor activities in village economies correlate with poverty and whether enabling the poorest women to take on the activities of their richer counterparts can set them on a sustainable trajectory out of poverty to do this we conduct a large scale randomized control trial covering over 21 000 households in 1 309 villages surveyed four times over a seven year period to evaluate a nationwide program in bangladesh that transfers livestock assets and skills to the poorest women at baseline the poorest women mostly engage in low return and seasonal casual wage labor while wealthier women solely engage in livestock rearing the program enables poor women to start engaging in livestock rearing increasing their aggregate labor supply and earnings this leads to asset accumulation livestock land and business assets and poverty reduction both accelerating after four and seven years these gains do not come at the expense of others non eligibles livestock rearing businesses are not crowded out and wages received for casual jobs increase as the poor reduce their labor supply in such labor activities our results show that i the poor are able to take on the work activities of the non poor but face barriers to doing so and ii one o interventions that remove these barriers lead to sustainable poverty reduction

valuing school quality better transport and lower crime evidence from house prices housing prices within urban areas exhibit highly localized variation that cannot be explained solely by differences in the physical attributes of dwellings we consider the role of local amenities and disamenities in generating price variation within urban areas focusing on three highly policy relevant urban issues transport accessibility school quality and crime our survey of the recent empirical literature highlights what is known and what is not known on these issues and considers the relevance and reliability of this evidence for policy design and evaluation although there are serious empirical challenges we argue that research on housing values based on careful research designs can offer credible estimates of the social value of place specific attributes and amenities

the cyclical behaviour of fiscal policy evidence from the oecd this paper addresses the topic of cyclicality in scal policy in particular we show that the level of cyclicality varies across spending categories and across oecd countries in line with leading theories of scal cyclicality we show that countries with volatile output and dispersed political power are the most likely to run procyclical scal policies wage government consumption is highlighted as the most important channel by which these variables affect scal cyclicality

swings in commercial and residential land prices in the united states abstract we use a large dataset of land sales dating back to the mid 1990s to construct land price indexes for 23 msas in the united states and for the aggregate of those msas the price indexes show a dramatic increase in both commercial and residential land prices over several years prior to their peak in 2006 2007 and a steep descent since then these fluctuations have exceeded those in well known indexes of home prices and commercial real estate prices because those indexes price a bundle of land and structures this comparison implies that land prices have been more volatile than structures prices over this period this result is a key element of the land leverage hypothesis which holds that home prices and commercial property prices will be more volatile all else equal in areas where land represents a larger share of real estate value

sticking to fiscal plans the role of institutions the rules based fiscal framework of the emu relies heavily on the development of medium term fiscal plans by the eu governments in this paper i present an empirical analysis of the deviations from the plans presented in the annual stability and convergence programs i focus on projections for real gdp growth and general government balances revenues and spending at different time horizons i show that deviations from the projections presented in these programs since 1999 can be explained by institutional factors i e the form of fiscal governance and the stringency of fiscal rules

mobility housing markets and schools estimating the effects of inter district choice programs abstract in theoretical models of residential sorting a household s location decision is closely linked to its demand for local public services such as schooling since school choice programs weaken the link between residential location and schooling options they have the potential to affect both property values and residential location choices results derived from computable general equilibrium models suggest these effects could be large but there is limited empirical evidence concerning whether they actually occur this paper develops and tests predictions concerning the impact of inter district choice programs on housing values and residential location decisions our empirical results strongly confirm our theoretical predictions and the findings of the computable general equilibrium literature after their states adopt inter district choice programs districts with desirable nearby out of district schooling options experience relatively large increases in housing values residential income and population density

which school attributes matter the influence of school district performance and demographic composition on property values abstract increasing levels of segregation in american schools raises the question do home buyers pay for test scores or demographic composition this paper uses connecticut panel data spanning eleven years from 1994 to 2004 to ascertain the relationship between property values and school district attributes such as student test scores and the racial and ethnic composition of the student body town and census tract fixed effects are included to control for neighborhood unobservables the effect of changes in school district attributes is also examined over a decade long time frame in order to focus on the effect of long run changes which are more likely to be capitalized into prices the study finds strong evidence that increases in percent hispanic have a negative effect on housing prices in connecticut but mixed evidence concerning the impact of test scores on property values student test scores also appear to have increased in importance for explaining housing prices in recent years while the importance of percent hispanic has declined finally the study finds that estimates of property tax capitalization increase substantially when the analysis focuses on long run changes

real wage determination in bangladesh agriculture an econometric investigation thsi paper develops and estimates a real wage model for the agricultural sector in bangladesh for the period 1973 2 1985 4 the model is developed within the framework of the market theory of labour demand and labour supply the empirical results are supportive of the market theory of wages

rural wages labor supply and land reform a theoretical and empirical analysis land reform is one of the most mentioned of the theoretical policy instruments discussed in the development literature yet relatively little attention has been paid to the wage rate consequences of such a program despite the fact that perhaps more than one half of rural families in a developing country receive a substantial proportion of their income from wage earnings in agriculture one reason for this lacuna may be that the determination of wages and family labor supply in the agricultural sector of ldcs has also been somewhat neglected particularly in the context of a heterogeneous labor force 2 the subsistence or institutional wage models of w arthur lewis john fei and gustav ranis and gerald rodgers for instance offer no theory of how rural wage levels or differentials are set and thus provide little guidance on how wage rates would be affected by changes in land ownership patterns more recently pranab bardhan and t n srinivasan david newbery and clive bell and pinhas zusman who formulate general equilibrium market or bargaining models determining endogenously the rental share paid by tenant sharecroppers have assumed that agricultural wage rates are exogenous or determined only by nonagricultural factors all of these models assume that rural labor is homogeneous another reason why the potential wage impact of a land reform program may have received little attention is that models of peasant family behavior such as those of a k sen dipak mazumdar and robert mabro typically embody two restrictive assumptions which would tend to make the equalization of landholdings appear wage augmenting although this implication has never been formally derived these assumptions are that 1 agriculture is dualistic with small farm families facing lower shadow prices of labor leisure than large farm landlords because of impediments to labor mobility and 2 agricultural households are dichotomous small farmers employ family labor and maximize utility while large farms only utilize wage labor and maximize profits data from a 1970 71 allindia survey of over 5 000 households collected by the national council of applied economic research3 indicate however that almost all cultivator households large and small participate actively in the labor market as either buyers or sellers of labor services with almost 88 percent of households cultivating a gross cropped area less than 1 5 acres utilizing some hired labor seventynine percent of these small farm households associate professor yale ujniversity the research embodied in this paper was supported in part by a grant from the ford and rockefeller foundations program in support of social science and legal research on population policy and with funds from the u s agency for international development under order no aid otr 1432 helpful suggestions and comments were provided by james l mccabe mark gersovitz an anonymous referee the managing editor and members of the economic growth center yale university i am also grateful to the members of the research program in development studies princeton university for the use of their facilities research assistance was provided by james devine anne morgan and roberta robson inotable exceptions are r albert berry mark gersovitz and m a rahman all of these authors however employ geometric analyses with differing assumptions leading to wholly different predictions regarding wage effects none consider the heterogeneity of agricultural labor pay attention to questions of stability or attempt to apply their models to data 2lnformation on the differential impact of alternative agricultural policies including land reform on sex or age specific wage rates is not only important in settling income distribution and equity issues but as suggested in an article by the author and robert evenson may have significant implications for population growth and schooling as well 3for a more detailed discussion of these data see the author

estimating housing demand with an application to explaining racial segregation in cities we present a three stage nonparametric estimation procedure to recover willingness to pay for housing attributes in the first stage we estimate a nonparametric hedonic home price function in the second stage we recover each consumer s taste parameters for product characteristics using first order conditions for utility maximization finally in the third stage we estimate the distribution of household tastes as a function of household demographics as an application of our methods we compare alternative explanations for why blacks choose to live in center cities while whites suburbanize

the promise and pitfalls of using imprecise school accountability measures in recent years most states have constructed elaborate accountability systems using school level test scores however because the median elementary school contains only 69 children per grade level such measures are quite imprecise we evaluate the implications for school accountability systems for instance rewards or sanctions for schools with scores at either extreme primarily affect small schools and provide weak incentives to large ones nevertheless we conclude that accountability systems may be worthwhile even in states with aggressive financial incentives the marginal reward to schools for raising student performance is a small fraction of the potential labor market value for students

intra household labour allocation migration and remittances in rural el salvador abstractmigration can affect labour participation decisions back home either by stimulating work to replace foregone labour or reducing it through the role of remittances using evidence from a r

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

has u s monetary policy changed evidence from drifting coefficients and real time data despite the large amount of empirical research on monetary policy rules there is surprisingly little consensus on the nature or even the existence of changes in the conduct of u s monetary policy three issues appear central to this disagreement 1 the specific type of changes in the policy coefficients 2 the treatment of heteroskedasticity and 3 the real time nature of the data used this paper addresses these issues in the context of forwardlooking taylor rules with drifting coefficients the estimation is based on real time data and accounts for the presence of heteroskedasticity in the policy shock the findings suggest important but gradual changes in the rule coefficients not adequately captured by the usual split sample estimation in contrast to orphanides 2002 2003 i find that the fed s response to the real time forecast of inflation was weak in the second half of the 1970s perhaps not satisfying taylor s principle as suggested by clarida gali and gertler 2000 however the response to inflation was strong before 1973 and gradually regained strength from the early 1980s onward moreover as in orphanides 2003 the fed s response to real activity fell substantially and lastingly during the 1970s

property tax capitalization in a model with tax deferred assets standard deductions and the taxation of nominal interest previous property tax capitalization studies assume that families itemize that they save in taxable assets and that real interest income is taxed however many families do not itemize many families invest in tax deferred assets and nominal interest income is taxed as a consequence prior studies likely misspecify the property tax capitalization equation for roughly ninety percent of their samples taking federal tax provisions into account increases the precision of our estimated capitalization rate in addition our results suggest that biases in prior studies likely contribute to the variety of capitalization estimates in the literature

tiebout bias and the demand for local public schooling institute of university of ii business and california economic research berkeley center for real estate and urban economics working paper series working paper 86 109 tiebout bias and the demand for local public schooling by daniel l rubinfeld perry shipiro judith roberts these papers are preliminary in nature th urpose 39 to stimulate 39 ussion comment therefore they are not t cited or quoted 39 ny p ation wit express permissio the author graduate school of business administration

offered wage and recipient attribute wage functions for rural labour in india abstract wage functions are estimated for daily hire labour in two village markets in india through a single equation procedure with the dependent variable defined to yield a true measure of offered wage in the presence of censorship wages for males rise with age up to forty but decline thereafter for females by contrast reward for experience is relatively unimportant but there is a positive association between offered wage and economic status these findings differ from those reported so far in the literature without correction for censorship bias and challenge the assumed homogeneity of rural labour in much theorising about factor markets in less developed countries

the off farm labor supply of farmers theoretical and empirical models are developed to examine the off farm wages labor force participation and hours of work of farmers econometric estimates use data from a 1971 survey of illinois farmers the off farm wage depends on farmer human capital and the local labor market the major result confirms the sensitivity of off farm work to economic incentives a 10 increase in the off farm wage entails an 11 increase in hours of off farm work holding farm characteristics constant results also indicate effects of seasonality risk and life cycle factors on off farm work

inequality in children s contexts income segregation of households with and without children past research shows that income segregation between neighborhoods increased over the past several decades in this article i reexamine income segregation from 1990 to 2010 in the 100 largest metropolitan areas and i find that income segregation increased only among families with children among childless households two thirds of the population income segregation changed little and is half as large as among households with children i examine two factors that may account for these differences by household composition first i find that increasing income inequality identified by past research as a driver of income segregation was a much more powerful predictor of income segregation among families with children among whom income inequality has risen more second i find that local school options delineated by school district boundaries contribute to higher segregation among households with children compared to households without rising income inequality provided high income households more resources

edge versus center finding common ground in the capitalization debate abstract a continuing debate questions whether capitalization of taxes and public services into house price occurs the current study argues for an inverse relationship between housing supply elasticity and capitalization rates a sample is split into houses on the interior and edge of the urban area capitalization of schooling and crime occurs everywhere but it is weaker toward the edge of an urban area where housing supply elasticities and developer activity are greater tax results are less robust but the capitalization rates of crime and school quality are roughly twice as strong on the interior than on the urban fringe

real time fiscal forecasting using mixed frequency data the sovereign debt crisis has increased the importance of monitoring budgetary execution we employ real time data using a mixed data sampling midas methodology to demonstrate how budgetary slippages can be detected early on we show that in spite of using real time data the year end forecast errors diminish significantly when incorporating intra annual information our results show the benefits of forecasting aggregates via subcomponents in this case total government revenue and expenditure our methodology could significantly improve fiscal surveillance and could therefore be an important part of the european commission s model toolkit

oligarchic land ownership entrepreneurship and economic development abstract this paper develops a theory in which oligarchic ownership of land or other natural resources may impede entrepreneurship in the manufacturing sector and may thereby retard structural change and economic development we show that due to oligopsony power of owners in the agricultural labor market higher ownership concentration depresses entrepreneurial investments by landless credit constrained households whose investment possibilities depend on the income earned in the primary sector we discuss historical evidence from latin america india taiwan and south korea which supports our theory

does school district and municipality border congruence matter research on zoning typically assumes that city planners aim to maximise housing prices with their land use decisions either explicitly for public choice reasons or implicitly through the approval of land uses that create local net benefits noncongruence of school district and municipality borders severs the link between costs and benefits in the eyes of the median voter however which could result in excessive residential development and fiscal externalities that lower property values this paper uses a hedonic approach to indirectly observe the presence of these externalities border congruency between school districts and municipalities in ohio is measured using gis data and matched with a data set of 56 717 home sales the hedonic results indicate that noncongruence is associated with lower housing prices while the degree of noncongruence is positively related for most school districts the negative effect of noncongruency dominates my results are robust and consistent across different model spec

making negotiated land reform work initial experience from colombia brazil and south africa abstract the paper describes background initial experience and future challenges associated with a new negotiated approach to land reform this approach has emerged as following the end of the cold war and broad macroeconomic adjustment many countries face a second generation of reforms to address deep rooted structural problems and provide the basis for sustainable poverty reduction and economic growth it reviews possible theoretical links through credit market or political channels between asset ownership and economic performance program characteristics in each country as well as lessons for implementation and implications for monitoring and impact assessment are discussed

the effects of economic development on life cycle wage rates and labor supply behavior in malaysia abstract this paper uses retrospective earnings and work history data on a sample of malaysian married couples to estimate the determinants of earnings and family labor supply the sample data are merged with aggregate time series data on the malaysian economy so that the effects of both individual and aggregate determinants of wage rates are explored dissaggregation of the analysis by cohort education and race permits estimation of the differential impact of ecomomic development on different groups the results syggest substantial variation in the extent of participation by different groups in the development process

hedonic prices and implicit markets estimating demand and supply functions for differentiated products in choosing the level of quality to purchase the buyer of a differentiated product also chooses a point on the marginal price schedule for that product hence in general the demand functions for product characteristics cannot be consistently estimated by ordinary least squares market equilibrium results in a matching of characteristics of demanders and suppliers this matching restricts the use of buyer and seller characteristics as instruments when estimating demand and supply functions for product characteristics the paper develops these issues a stochastic structure for hedonic equilibrium models is then proposed identification results are presented and estimation procedures are outlined

the value of school in urban china a spatial quantile regression with housing transactions in beijing this study adopts microdata of individual housing transactions in beijing to explore the value that households place on high quality schools it is among the first to match exactly the housing unit

capitalising the value of free schools the impact of supply characteristics and uncertainty there has been a growing literature in both the us for example haurin and brasington 1996 and black 1999 and the uk for example gibbons machin 2003 that estimates the way in which school quality is capitalised into house prices cheshire and sheppard 1995 and 1999 estimated hedonic models in which the quality of the secondary school to which a household was assigned was a significant variable which provided evidence that secondary school quality was being capitalised into the price of houses in contrast gibbons and machin concluded that primary schools were more significant each of these analyses is predicated on the assumption that the value of local schools should be reflected in the value of houses we argue here that this is rather too simple we should expect variation in the capitalised price of a given school quality at either primary or secondary level according to the elasticity of supply of school quality in the local market the certainty with which that quality can be expected to be maintained over time and the suitability of the dwelling to accommodate children these factors will vary systematically between and perhaps within cities this paper explores the sources and the impact of such variations as well as the impact of model specification the results provide new evidence on the complex and subtle ways in which housing markets capitalise the value of local public goods such as school quality and perhaps most importantly suggest that this is highly non linear houses in the catchment areas of only the best state schools command substantial premiums but such capitalised values can be very substantial indeed

international comparisons of living standards by equivalent incomes we propose a measure of living standards for international comparisons based on gdp per capita the measure incorporates corrections for international flows of income labor risk of unemployment healthy life expectancy household demography and inequalities the method for comparing populations that differ in some non income dimension consists of computing the equivalent variation of income that would make each population indifferent between its current situation and a reference situation with respect to the non income dimension this is applied to 24 oecd countries the obtained ranking of countries differs substantially from the gdp ranking