estimates of the returns to quality and coauthorship in economic academia salaries of academic economists are studied to determine if individuals receive differential returns to publishing articles of varying quality and to coauthored versus single authored articles estimates based on detailed data and a flexible nonlinear least squares procedure indicate that substantial returns to quality exist and that an individual s return from a coauthored paper with n authors is approximately 1 n times that of a single authored paper

a review of wta wtp studies abstract willingness to accept wta is usually substantially higher than willingness to pay wtp these constructs have been studied for roughly 30 years and with a wide variety of goods this paper reviews those studies we find that the less the good is like an ordinary market good the higher is the ratio the ratio is highest for non market goods next highest for ordinary private goods and lowest for experiments involving forms of money a generalization of this pattern holds even when we account for differences in survey design ordinary goods have lower ratios than non ordinary ones we also find that ratios in real experiments are not significantly different from hypothetical experiments and that incentive compatible elicitation yields higher ratios

arbitrary values good causes and premature verdicts abstract this paper offers an alternative interpretation of the conclusions kahneman and knetsch propose based on two contingent valuation cvm surveys the evaluation argues that while framing is important to cvm estimates the design implementation and empirical findings reported from these surveys do not support their judgments moreover with the exception of temporal embedding conventional economic descriptions of individual behavior can explain the response patterns that they suggest are at variance with standard value theory

an experimental validation of hypothetical wtp for a recyclable product using a within subject experiment we compare hypothetical andreal willingness to pay wtp for an improvement in therecyclability of a product subjects are faced with a real paymentscenario after they have responded to a hypothetical question contrary to most of the results obtained in similar studies at apopulation level there are no significant median differencesbetween actual and hypothetical stated values of wtp however within subject comparisons between hypothetical and actual valuesindicate that subjects stating a low high hypothetical wtp tendto underestimate overestimate the value of their actualcontributions

inflation proof currency the feasibility of variable commodity standards under a proposal by robert l greenfield and leland b yeager 1989 the value of currency is tied to the value of a defined basket of goods by indirect convertibility the note issuing bank offers to redeem its currency for sufficient gold to buy the basket in the market the authors find that this arrangement cannot be applied to the currency that is the medium of account for quoting prices of goods and that it would imply unlimited change in the gold price when the price of the basket deviates from unity a feedback rule with slower price adjustment may however be feasible copyright 1993 by ohio state university press

what are households willing to pay for improved water access results from a meta analysis abstract although several factors contribute to low rates of access to improved water and sanitation in the developing world it is especially important to understand and measure household demand for these services one valuable source of information regarding demand is the growing empirical literature that has applied stated preference methods to estimate households willingness to pay wtp because it is difficult to generalize and support planning based on this scattered literature we conduct a meta analysis to take stock of the worldwide sample of household wtp for improved drinking water services using 171 wtp estimates drawn from 60 studies we first describe this sample and then examine the potential factors that explain variation in wtp estimates our results suggest that households are willing to pay between approximately 3 and 30 per month for improvements in water access specifically in line with economic theory and intuition wtp is sensitive to scope the magnitude of improvement in drinking water services as well as household income and stated preference elicitation method we demonstrate how our results can be used to predict household level wtp for selected improvements in drinking water access in regions with low coverage and find that private benefits exceed the cost of provision

silicon envy how global innovation clusters hurt or stimulate each other across developed and emerging markets the authors examine intercluster dynamics among rival global clusters on monthly counts of patents startups and new product commercializations between 1999 and 2014 while controlling for numerous exogenous variables results show that rival innovation clusters facilitate rather than hinder each other s growth due to resources complementarities reverse fertilization occurs from emerging to developed clusters contrary to the received wisdom this study is the first to show intercluster dynamics as important drivers of cluster growth to explain the counterintuitive findings the authors draw upon the coopetition view which suggests mutually beneficial growth across all rival clusters rather than zero sum gains

estimation using contingent valuation data from a dichotomous choice with follow up questionnaire reply abstract our original article proposed that the two yes no willingness to pay wtp responses produced by this survey format should be viewed as a pair of jointly distributed correlated discrete random variables the comparison model the conventional approach to estimation using these types of data contained a programming error correction alters the results from the comparison model but our original claim that estimation by conventional methods can produce misleading inferences if ours is the appropriate specification still stands this is especially true if negative wtp is precluded when e wtp is calculated

does altruism undermine existence value abstract the debate over the use of contingent valuation for existence values or passive use values has failed to explore the validity of motives for such values one potential motive altruism has conflicting implications for benefit cost analysis depending on whether the altruist is paternalistic this paper constructs models of three types of altruism and shows how benefit cost analysis responds to each type of altruism how damage assessment and restoration depend on each type and the implications of a population of heterogeneous altruists

monte carlo benchmarks for discrete response valuation methods this paper argues that the belief that discrete contingent valuation cv questions yield substantially larger estimates of the mean and the median willingness to pay wtp for nonmarket resources in comparison to open ended cv questions is unfounded monte carlo experiments estimate the factors influencing the performance of wtp estimates based on discrete response models most of the error arises from the specification errors common to the empirical models in the literature these experiments suggest models where wtp is dominated by nonuse or passive use values are likely to have smaller errors than where large use values influence these decisions

entry mode organizational learning and r d in foreign affiliates evidence from japanese firms this paper develops hypotheses concerning the role of entry mode and experience based organizational learning as determinants of the r d intensity of foreign affiliates and tests these hypotheses on a sample of 420 japanese manufacturing affiliates abroad entry mode has a major impact on r d activities the r d intensities of acquired affiliates substantially exceed those in wholly owned greenfield affiliates while the r d intensities of minority owned ventures are higher if japanese parent firms lack strong r d capabilities at home for greenfield operations support is found for an incremental growth pattern of foreign r d as a function of organizational learning and affiliate capability building the results are consistent with the view that part of the explanation for japanese firms relative lack of involvement in overseas r d must be sought in their status as latecomers in the establishment of overseas manufacturing networks at the same time a number of japanese firms have actively used foreign acquisitions and joint ventures to gain access to overseas technology and to establish overseas r d capabilities at a faster pace copyright 2002 john wiley sons ltd

values elicited from open ended real experiments abstract the idea that preferences are only revealed by real incentives is deeply embedded in economists worldview consequently evidence from hypothetical experiments has not readily permeated economic thinking one method for determining whether hypothetical experiments provide useful information about preferences is to compare them to similar real goods experiments this study looks at responses elicited by three real experiments we examine the proportion of responses that meet a series of criteria that range from a broad appeal of plausibility to a narrow restriction based on quasi concavity of preferences we argue that these proportions are unreasonably low

price principle and the environment should preferences count as a normative discipline welfare and therefore resource economics postulates that preferences should count in the allocation of resources this postulate cannot be justified in relation to choice or to well being the nor mative qualities that attend choices e g ac countability responsibility commitment and consent explain why choices should count but not preferences which are not actions but theo retical entities constructed ad hoc from stipu lated descriptions of behavior they are then said to explain the satisfaction of preferences moreover has no demonstrable relation with any conception of welfare or well being not sim ply defined in terms of it jel a13

a satisfactory benefit cost indicator from contingent valuation abstract standard economic concepts are used to develop a model of individual behavior when subject to the constraints of the contingent valuation choice context the model yields refutable consequences that are consistent with previously reported empirical findings including some that have been thought to be anomalous the model is used to show that different contingent valuation formats have predictably different performance characteristics notably the hicksian compensating measures are satisfactory benefit cost indicators when elicited using any one of several formats identified in the text of the formats examined one form of a policy referendum appears to have the most satisfactory characteristics overall we conclude that contingent valuation is a progressing research program

who gets what in environmental policy this paper shows how anticipated impacts of environmental projects and policies can be valued in terms of money as a common denominator and costs and benefits assigned in an acceptable distribution to that effect a new mechanism design of situational contracting is introduced that generates information on willingness and ability to pay or to cooperate in a realization focused capability approach to fairness the situational contract reveals preferences and merit considerations of the relevant stakeholders and deals with market failure in a structured combination of political guidance expert opinions and co production

do contingent valuation estimates pass a scope test a meta analysis abstract this paper considers the scope test proposed to judge the internal consistency of contingent valuation estimates the test is shown to be quite sensitive to the maintained hypotheses required to derive fairly precise expectations for the properties of wtp functions and therefore a different approach may be needed in gauging the reliability of cv this paper describes an approach that relies on a weight of the evidence criterion and uses meta analysis to develop a systematic appraisal of what the economic values of changes in amenity resources are the approach is illustrated for the case of estimating people s willingness to pay for improving or maintaining visibility at the national parks

effect of distance on the preservation value of water quality in the past dozen years an extensive body of literature has developed on the willingness to pay for water quality in particular its recreation use and nonuse preservation values this paper illustrates a procedure for estimating the effect of distance on the preservation value of environmental quality using the contingent valuation approach the case considered is the potential degradation of water quality due to coal mining activity in the flathead river drainage system montana the analysis supports a negative association for this particular study area the effect of distance on preservation value was considered both directly and indirectly through its effect on visits 36 references 2 tables

understanding the consequences of consequentiality testing the validity of stated preferences in the field this study pursues the external validation of stated preference methods by comparing survey responses from verified voters with the outcome of a parallel public referendum on a conservation and preservation program to be funded by a local property tax surcharge the majority of respondents were unaware of the upcoming referendum and the experimental design allows us to control for referenda related information effects as well as respondents perceptions regarding the consequentiality i e the potential policy impact of their survey votes we find the survey under predicts yes referendum votes at the precinct level these differences go away however if we focus only on respondents who perceived their survey vote to be consequential negative hypothetical bias among inconsequential survey respondents is also evident in the estimation of willingness to pay and controlling for consequentiality increases construct validity

yea saying in contingent valuation surveys a number of recent papers have provided estimates of willingness to pay derived in contingent valuation surveys exceeding those revealed in experimental or real life markets one possible explanation for the overestimation of values is the presence of yea saying with the objective of reducing the occurrence of yea saying a new elicitation format referred to as the dissonance minimizing d m format is proposed an empirical comparison of the dm format with the conventional dichotomous choice dc format and the ambivalence reducing polychotomous choice pc format suggested by ready whitehead and blomquist 1995 is made results are encouraging for the dm

why are prices sticky preliminary results from an interview study this paper reports preliminary results from a large research project on business pricing which is currently underway the idea is to use interviews with actual price setters to assess the validity of a dozen theories of price stickiness the rather unorthodox for economists methodology is defended the research design is described briefly and a few results based on the first 72 interviews out of a projected 200 are presented this sample suggests that the median firm changes its price annually and that price adjustments typically lag 3 4 months behind shocks to demand or cost this abstract was borrowed from another version of this item

safe nests in global nets internationalization and appropriability of r d in wireless telecom this paper documents the case of the wireless telecom industry to bring new empirical evidence to the debate on the internationalization of research and development r d activities us patent statistics on the four industry leaders ericsson motorola nokia and qualcomm illustrate the growing trend of the internationalization of r d over the 1990s yet we show that the most critical r d projects related to the development of wireless standards remain homebound the paper then leverages qualitative data collected through interviews with informed managers to provide a fresh interpretation for the homeboundedness of critical industrial r d the stickiness of core r d projects to domestic locations is related not only to organizational inertia and the unripe maturation of subsidiaries as suggested by prior literature but particularly to the headquarters centralization of intellectual property ip management which offers a high level of appropriability of r d results the unequal distribution of appropriability across corporate r d networks is at the base of the formation of safe nests domestic r d centers that are sheltered from the forces of globalization because they offer a desirable setting for the exploitation of technologies deriving from a stronger coordination of inventive activities with the management of ip

the paradox of technological capabilities a study of knowledge sourcing from host countries of overseas r d operations we investigate the factors that influence the extent to which a multinational corporation s headquarters mnc hq sources knowledge from the host countries of its r d labs we propose that the technological capabilities held by mnc hqs present a paradox on the one hand they enhance mnc hqs learning capabilities on the other hand they reduce mnc hqs motivations to outsource knowledge from host countries we also argue that it is important to consider both relative and absolute levels of technological capabilities because relative levels can influence mnc hqs motivations to source knowledge from host countries statistical findings generally support our arguments

evaluation of nonmarket goods recovering unconditional preferences a new approach is proposed for the evaluation of nonmarket goods starting from a complete or incomplete conditional demand system for market goods which is observable and depends on nonmarket goods this information is not sufficient to recover the underlying preference ordering of the representative consumer the central idea is to employ additional marginal willingness to pay functions for the nonmarket goods since they can be estimated either together with the demand system or in a separate step they are less arbitrary than the assumptions or hypotheses usually made if the entire system is weakly integrable the underlying ordering and appropriate welfare measures can be derived in this article i investigate the relationship between conditional and unconditional demand systems present sufficient conditions for weak integrability and demonstrate the practicability of the procedure proposed by means of three examples

the case for diminishing marginal existence values abstract this study addresses the debate over sensitivity of existence values measured by contingent valuation to scope tests we reconcile much of the debate within one theoretical model if marginal wtp for existence goods is diminishing then a study that tested for sensitivity to scope over a range for which marginal wtp is high would be more likely to detect sensitivity to scope than a study that focused on a range for which marginal wtp is much lower an empirical model demonstrates this point for existence value of remote wilderness parks these results have significant implications for future contingent valuation work

r d scope economies and plant performance in this article i present an alternative specification of knowledge production and derive a structural econometric model with some desirable properties i provide a simple and less data intensive framework for empirical studies of the relationship between firm performance and r d the main empirical findings are as follows i r d has a positive effect on performance ii the appropriable part of knowledge capital depreciates at a rate of 2 iii there are significant spillover effects of r d across lines of business within a firm and iv there are significant spillovers in r d across firms that belong to the same interlocking group of firms

is indirect convertibility impossible comment norbert schnadt and john whittaker 1993 criticize proposals for defining the dollar by a broad basket of goods but making money redeemable otherwise than directly in this composite medium of account indirect redemption would be more convenient for all parties involved each dollar of face value of banknotes and deposits would be redeemable in whatever changeable quantity of some specified redemption medium had an actual market value equal to the total value of the dollar defining basket this convertibility into a basket s worth of redemption medium would keep a one dollar banknote or deposit always equal in value to the basket itself in challenging this idea sw and schnadt and whittaker we and others devoted a session to it at the january 1992 american economic association meetings this worry turns out to be a red herring in the central meaning of that metaphor following the earlier literature s w suppose that a bank redeems each dollar of notes and deposits in enough gold to be worth at its market price the total market price of the composite medium of account they recognize that if this basket s total price somehow came to exceed 1 gold s hitherto prevailing market price would exceed in the same proportion its price implied by the quantity of gold delivered for each dollar bill at the bank s redemption window gold s market price they ar

diagnosing insensitivity to scope in contingent valuation sensitivity to scope is considered a desirable property of contingent valuation studies and often treated as a necessary condition for validity we first provide an overview of scope insensitivity explanations put forth in the environmental valuation literature then we analyze data from a contingent valuation survey eliciting willingness to pay to prevent oil spills of four different magnitudes in arctic norway in the baseline analysis the scope inference is ambiguous there is only statistical difference in willingness to pay to avoid a very large versus small oil spill nok 1869 and nok 1086 respectively however further explorations show that several confounding factors suggested in the literature influence the scope inference the scope sensitivity improves when we control for subjective probabilities of amenity provision exclude respondents based on the debriefing questions take into consideration the sample sizes and impose diminishing marginal utility overall the analysis supports an emerging view in the contingent valuation literature suggesting that statistical scope insensitivity is not a sufficient reason for deeming a study invalid

natural resource federalism preferences versus connectivity for patchy resources we examine the efficiency of centralized versus decentralized management of spatially connected renewable resources when users have heterogeneous preferences for conservation versus extraction resource mobility induces a spatial externality while spatial preference heterogeneity drives a wedge between users privately optimal extraction rates we first address these market failures analytically and show that the first is most efficiently handled with centralized planning while the second is best tackled with decentralized management except in special cases neither approach will be first best but which arises as second best depends on the relative strength of preference heterogeneity versus spatial mobility of the resource we illustrate the theory and test its robustness with a numerical example

utilization of r d results in the home and foreign plants of multinationals this paper analyzes the utilization of r d results in the home and foreign plants of swedish multinational enterprises mnes the findings indicate that firms r d undertaken in the home country is used as an input in both the home and foreign plants of the mnes this suggests that technology is transferred to the foreign plants around four fifths of the gain in value added attributed to home r d was realized in the mnes home plants while the remaining fifth benefitted the foreign plants r d in foreign affiliates does not appear to be used as an input in home plants

explaining organizational diseconomies of scale in r d agency problems and the allocation of engineering talent ideas and effort by firm size the comparative efficiency and success of small firms in r d remains largely unexplained this paper empirically examines scale diseconomies in offering employment contracts as an explanation for diseconomies of scale in r d the paper argues that small firms more efficiently resolve the severe agency problems of hidden information and hidden behavior in r d small firms more efficiently offer contracts that reward performance than large firms and consequently small firms attract and retain engineers with higher ability and skill further small firms through these more performance contingent contracts induce higher levels of effort than large firms the study tests and generally confirms these hypotheses using data collected from 912 current and former engineering employees of two large high technology companies

valuing public goods with the contingent valuation method a critique of kahneman and knetsch the social stakes in the use and abuse of the contingent valuation method cvm are very high recent developments in environmental law have elevated the cvm to the status of a refutable presumption in cases brought under certain statutes it is no longer adequate for economists to sniff at the continued popularity of the cvm in such cases it is instead incumbent on economists to come to some conclusions as to the domain under which the cvm may or may not be correctly applied one should not expect a simple thumbs up or thumbs down assessment in this matter such an expectation would be naive with respect to the inherent complexity of the issue not to mention the financial incentives that expert witnesses might have to breed as if controversy in an adversarial legal system in this context the strong admonitions of kahneman and knetsch 3 kk against the casual use of the cvm must be carefully examined they present what they believe to be evidence to support the claim that the cvm suffers from an embedding effect and that any reported willingness to pay wtp is best interpreted as the purchase of moral satisfaction rather than as a measure of the value associated with a particular public good i argue that their evidence is insufficient to test the implied hypotheses that it is incorrectly reported and that it is in large measure fully consistent with received economic theory

an experimental test of response consistency in contingent valuation we compare hypothetical and observed experimental willingness to pay wtp for a gradual improvement in the environmental performance of a marketed good an office table first following usual practices in marketing research subjects stated wtp for the improvement is obtained second the same subjects participate in a real reward experiment designed to replicate the scenario valued in the hypothetical question our results show that independently of the degree of the improvement there are no significant median differences between stated and experimental data however subjects reporting extreme values of wtp low or high exhibit a more moderate behavior in the experiment

location decentralization and knowledge sources for innovation when firms seek to innovate they must decide where to locate their innovation activity this location choice requires firms to make a simultaneous choice about the organizational structure of innovation activity almost by definition multiple locations per firm imply some degree of decentralization we compare predictions of the knowledge based view with the predictions of organizational economics regarding the location and decentralization of r d using firm level data on r d locations in finland we examine the conditions under which firms with multiple r d locations also have greater innovation output our results indicate that multilocation of r d activity is positively associated with imitative innovation output and is strongly correlated with greater external knowledge sourcing we also find that the positive association between multiple r d locations and innovative output does not apply to new to the market innovations the results are consistent with the interpretation that multilocation of r d enables firms to access a broad set of external sources of knowledge in pursuit of imitative rather than new to the market innovation moreover these findings imply heterogeneity in r d strategies between firms pursuing new to the market innovation and firms pursuing imitative innovation it is thus important to distinguish between new to the market and imitative innovations because their determinants may differ

the value of water supply reliability in urban water systems abstract reliability is an important dimension of urban water supply while out of pocket losses appear small water customers place high values on reliability this demand for reliability can be measured by contingent valuation methods while the costs of providing various levels of reliability can be estimated through hydrologic simulation a framework for optimizing reliability is presented and the contingent valuation survey is described results from three colorado towns are presented

the contingent valuation debate why economists should care t he contingent valuation method involves the use of sample surveys questionnaires to elicit the willingness of respondents to pay for generally hypothetical projects or programs the name of the method refers to the fact that the values revealed by respondents are contingent upon the constructed or simulated market presented in the survey a spirited and occasionally mean spirited battle over such methods is currently being waged involving competing factions within the federal government economists and lawyers representing business and environmental groups and interested academics as well at issue is a seemingly quite specific question should environmental regulations currently under development at both the department of the interior and the department of commerce sanction the use of the contingent valuation method in estimating the damage done by spills of oil chemicals or other substances covered by federal law more generally the debate raises broad questions about what economists have to say about the values that individuals place on public or private goods the two papers that follow this one make cases for and against the use of the contingent valuation method my aim here is to provide an overview of the technique and the debate surrounding it i also want to suggest why this debate should matter to economists both professionally and in their roles as citizens and consumers

the mechanics of indirect convertibility this paper sets out the mechanics and equilibrating processes of indirectly convertible monetary systems in which currency issuing banks redeem their currency with redemption media of the same value as the commodity or commodity basket that defines the dollar it goes on to investigate the paradox of indirect convertibility and suggests that indirect convertibility is feasible despite the paradox finally it assesses the systems of fisher hall and others that have been suggested as alternatives to indirect convertibility but concludes that these alternative systems are open to serious objections copyright 1995 by ohio state university press

non users willingness to pay for a national park an application and critique of the contingent valuation method bateman i j and langford i h 1997 non users willingness to pay for a national park an application and critique of the contingent valuation method reg studies 31 571 582 a great deal of the ongoing academic debate concerning the contingent valuation cv method has focused upon whether or not the method is suitable for assessing non use values this paper presents results from a study examining non users values for preserving the norfolk broads a wetland area of recognized international importance from the threat of saline flooding discussion of results centres upon the validity of the cv method for eliciting unbiased estimates of non use value a graphical representation of findings from a variety of studies is presented to suggest that such results are logically ordered across goods and valuation scenarios however as the paper concludes logicality and validity are not necessarily synonymous bateman i j et langford i h 1997 la volonte des non usagers de payer les parcs nationaux

do protest responses to a contingent valuation question and a choice experiment differ it is suggested that the number of protest responses in stated preference surveys depends inter alia on the valuation method used choice experiments ce are said to generate a lower number of protest responses than contingent valuation cv however no comparison of both methods with respect to protest responses has been conducted to date we used both ce and cv in a survey on forest biodiversity in two german regions protest beliefs were measured for all respondents irrespective of whether they were willing to pay or not the results show no clear pattern of differences between ce and cv regarding protest beliefs and protest responses using an attitude scale based on respondents protest beliefs we see a significant negative effect of this attitude on willingness to pay in both methods however in one of the two study regions the effect is weaker in ce than in cv

are we willing to pay enough to back the bid valuing the intangible impacts of london s bid to host the 2012 summer olympic games using a contingent valuation survey this paper provides the first empirical test of the proposition that intangible impacts might justify hosting major sporting events on cost benefit grounds respondents drawn from london manchester and glasgow were asked for their willingness to pay wtp to host the 2012 olympic games in london on the basis of the intangible impacts that this event might provide annual mean wtp is 22 12 and 11 per year for 10 years in these 3 uk cities respectively an illustrative total uk wtp for intangible impacts is in the region of 2 billion statistical analysis of wtp determinants reveals a range of plausible explanatory factors such as respondents degree of support for the bid

inter firm reverse technology transfer the home country effect of r d internationalization one consequence of the internationalization of rd these results are robust to the exclusion of examiner citations we find that this technology transfer process is explained by the degree of home country embeddedness of the multinational firm the us subsidiaries engagement in asset augmenting activities and the presence of a technology gap between the united states and the home country these results point to an alternative understanding of foreign direct r d investment and its implications for the home country s technological activity and general competitive performance copyright 2009 the author 2009 published by oxford university press on behalf of associazione icc all rights reserved oxford university press

sequencing and valuing public goods abstract this paper establishes several propositions concerning the importance of context in valuing public goods it first provides necessary and sufficient conditions for the value of a public good to be independent of context utility constant valuation sequences are considered where public goods are systematically made available or taken away for the case of strict hicksian substitutes willingness to pay for an increase in one of the public goods is strictly decreasing the farther out in a sequence it is valued for the destruction of public goods the reverse is true for willingness to accept compensation sequencing has opposite implications for the assessment of the benefits of providing public goods than for the assessment of the damage from destroying them

are french consumers ready to pay a premium for eco labeled seafood products a contingent valuation estimation with heterogeneous anchoring could the future french eco label for fresh seafood products find its place in the french market this study employs a contingent valuation method to estimate french consumers willingness to pay wtp for eco labeled fresh seafood products we exploit original data from a survey carried out in 2010 where 626 participants responded to a double bounded dichotomous choice model through an ascending or descending bid system controlling for shift and anchoring effects in random effect probit models we significantly improve estimation of wtp and its determinants for the three species studied monkfish lobster sole in particular when using heterogeneous anchoring we show that wtp is positively correlated to respondents income and also to their environmental concern to living alone to living far from the coast and to trusting ngos or public institutions more than producer organizations to implement an eco label we also show that the mean price premiums do not differ between species finally on average the maximum premium consumers accepted to pay is approximately 10 of the product price

a laissez faire approach to monetary stability this paper develops some diverse hints for a new monetary system offered separately by fischer black eugene fama and robert e hall for reasons that will become evident though we should perhaps say payments system instead of monetary system none of the economists mentioned has actually proposed the particular system set forth here nor examined all its properties and we call it the bfh system not to implicate them but only to give credit for some component ideas and to have a convenient label l regardless of who if anyone may actually advocate the system contemplating it is instructive it illuminates by contrast some characteristics of our existing and recent systems

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

contingent valuation a new perspective after several decades of academic research on the contingent valuation cv method a consistent behavioral explanation of hypothetical bias is still lacking based on evidence from economics economic psychology and the political sciences i propose an explanation that is based on two simple working hypotheses about respondent behaviour in contingent valuation surveys the first hypothesis is that survey respondents are unable to form consistent preferences about unfamiliar goods unless the choice context offers reliable informative cues that can be rationally exploited in simplified heuristics the second hypothesis is that the probability and impact of strategic responses in dichotomous choice questions about public goods depends on the extent to which the presented hypothetical costs differ from the actual costs the literature on hypothetical bias is revisited in the light of these behavioral hypotheses i find that the hypotheses are generally supported by the empirical data moreover the hypotheses are able to explain several important empirical phenomena that previous research has not been able to explain in particular they solve the puzzle that pre election polls but not cv surveys are able to predict actual referendum outcomes and they explain why income effects on willingness to pay are lower in cv responses than in actual votes if confirmed by further studies the hypotheses will have important implications for future research and practice first the hypothetical costs presented in the dichotomous choice question should to be close enough to the actual costs to be credible to all respondents this can be achieved by specifying the costs as a percentage rather than absolute change in taxes second the respondents should be given the option to answer based on information about the positions of large parties and interest groups with known political orientation rather than based on the raw policy information theory and evidence suggest that this new survey paradigm largely eliminates the fundamental problems of the conventional stated preference methods

why are companies offshoring innovation the emerging global race for talent this paper empirically studies determinants of decision by companies to offshore innovation activities it uses survey data from the international offshoring research network project to estimate the impact of managerial intentionality past experience and environmental factors on the probability of offshoring innovation projects the results show that the emerging shortage of highly skilled science and engineering talent in the us and more generally the need to access qualified personnel are important explanatory factors for offshoring innovation decisions moreover contrary to drivers of many other functions labor arbitrage is less important than other forms of cost savings the paper concludes with a discussion of the changing dynamics underlying offshoring of innovation activities suggesting that companies are entering a global race for talent

contingent valuation controversies and evidence contingent valuation cv has become one of the most widely used non market valuation techniques cv s prominence is due to its flexibility and ability to estimate total value including passive use value its use and the inclusion of passive use value in benefit cost analyses and environ mental litigation are the subject of a contentious debate this paper discusses key areas of the debate over cv and the validity of passive use value we conclude that many of the alleged problems with cv can be resolved by careful study design and implementation we further conclude that claims that empirical cv findings are theoretically inconsistent are not generally supported by the literature the debate over cv however has clarified several key issues related to nonmarket valuation and can provide useful guidance both to cv practitioners and the users of cv results

keep it local and fish friendly social acceptance of hydropower projects in switzerland hydropower is the largest source of renewable electricity in the world but despite being a mature and clean energy technology it has also been the subject of ecological and social conflict literature suggests that the social acceptance of renewable energy can be increased by respecting procedural justice fair participatory planning processes and distributional justice fairly allocating costs and benefits however empirical evidence about how justice considerations are related to the expansion of hydropower is scarce pre existing studies being mostly qualitative in nature we contribute to filling the gap in the current literature by describing in this paper how choice experiments with 1004 swiss residents were undertaken to explore the influence of procedural and distributional justice on acceptance relative to other attributes of hydropower projects we find that while considerations about justice do play a role in decisions to accept respondents in switzerland care most about ecological impacts and secondly about local ownership

sequencing and nesting in contingent valuation surveys abstract the term embedding is ill defined and has been applied to distinct phenomena some predicted by economic theory and others not this paper lays out a theoretical framework for looking at these phenomena and provides a set of well defined terms included is a discussion of survey design problems which may induce spurious evidence in favor of the hypothesis that respondents are insensitive to the scope of the good being valued an empirical example of the component sensitivity is provided this test rejects the hypothesis that respondents are insensitive to the scope of the good being valued

linking fdi motivation and host economy productivity effects conceptual and empirical analysis we develop a taxonomy that relates foreign direct investment fdi motivation technology and cost based to its anticipated effects on host countries domestic productivity we then empirically examine the effects of fdi into the united kingdom on domestic productivity and find that different types of fdi have markedly different productivity spillover effects which are consistent with the conceptual analysis the uk gains substantially only from inward fdi motivated by a strong technology based ownership advantage as theory predicts inward fdi motivated by technology sourcing considerations leads to no productivity spillovers

testing for temporal reliability in contingent valuation with time for changes in factors affecting demand we develop a temporal reliability test of the contingent valuation method separate random samples were administered the same telephone survey five years apart in the retest respondents have less favorable attitudes toward the environment given this result a temporally reliable contingent valuation would find lower willingness to pay we find that the estimates are temporally reliable after accounting for attitudes which have changed over the five year period values are not significantly different five years apart this study provides additional evidence that use of the contingent valuation method can provide useful information for environmental policy analysis

is there a paradox of indirect convertibility a paradox allegedly plagues systems in which money is only indirectly not directly convertible or redeemable we use the words interchangeably knut wicksell w william woolsey john whittaker and norbert schnadt tyler cowen and randall kroszner and hans michael trautwein have described scenarios in which indirect convertibility would have catastrophic consequences 21 23 17 18 19 3 20 currency deposits and checks are indirectly convertible when they are not redeemed directly in the medium of account the latter term is niehans s it means the commodity or commodity bundle of which some specified quantity defines the unit of account 16 1 money is redeemable instead in some redemption medium some other commodity or even some security in amounts equal in value to the quantity of medium of account defining the unit recent proposals combine indirect convertibility with free banking promising to stabilize the price level and avoid monetary disequilibrium that would disturb income and employment 13 12 25 26 27 28 4 in this bfh system so named perhaps misleadingly to acknowledge ideas borrowed altered and recombined from writings of fischer black eugene fama and robert hall government money is forbidden only competing private banks issue notes coins and checking accounts earlier proposals assumed government issue of currency simon newcomb and aneurin williams advocated money convertible into whatever variable amount of gold as redemption medium had a fixed general purchasing power 15 22 irving fisher citing their proposals argued that the dollar could be stabilized through convertibility into an amount of gold equal in value to a bundle of goods 10 331 2 indirect convertibility is not the same as fisher s betterknown proposal for a compensated dollar 8 337 47 10 494 502 11 95 7 in place of his earlier brief suggestion for indirect convertibility fisher later envisaged periodic discrete adjustments in the gold content of the dollar that is in the official price of gold prompted by deviations

the globalization of r d results of a survey of foreign affiliated r d laboratories in the usa abstract this paper examines the globalization of innovation and the phenomenon of foreign direct investment fdi in research and development to do so it draws from a survey of foreign affiliated r d laboratories in the united states while the literature on foreign direct investment has emphasized the role of markets in driving off shore investments the main conclusion of this research is that the globalization of innovation is driven in large measure by technology factors of particular importance is the objective of firms to secure access to scientific and technical human capital

the returns to foreign r d extant research on research and development r d internationalization has not examined how effective foreign r d investments are in generating positive returns for the investing firms in particular in comparison and conjunction with the effects of domestic r d investments we examine the effectiveness of international knowledge sourcing through foreign r d in an empirical analysis of the productivity effects of foreign and domestic r d investments in a large panel of firms based in the netherlands we argue that foreign and domestic r d will exhibit complementarity in their effects on productivity but that the roles of domestic and foreign r d depend on the relative position of the home country with respect to the global technology frontier and the related relative opportunities for knowledge sourcing abroad we estimate a dynamic panel data model derived from a knowledge stock augmented production function framework allowing for productivity convergence and declining returns to r d we confirm that for firms active in industries in which the home country is behind the global technology frontier foreign r d provides positive returns and has a complementary relationship with domestic r d for industries at the global technology frontier in contrast domestic r d is the primary source of productivity growth

research trends in environmental and resource economics insights from four decades of jeem abstract this paper provides a contemporary analysis of how research issues have developed in the journal of environmental economics and management jeem over the four decades of its existence we have classified the articles in the journal along five dimensions content methods environmental media the regional dimension of studies and cross cutting issues while up to about 10 years ago non market valuation and cost benefit analysis natural resource economics and environmental policy instruments represented the lion s share of articles published in the journal more recently we observe a significant shift towards a more diversified array of research areas with climate change and energy issues finding their way into the journal in addition increasing methodological plurality becomes apparent reflected in a significant shift away from economic theory and towards empirical approaches we also analyze key distinctions between the major environmental economics journals finally we analyze jeem s external influence on leading general economics a journals we find that a citations are positively correlated with a focus on climate change economics market based environmental policies and policy comparisons the use of econometric and statistical methods or experimental approaches and negatively correlated with a focus on water pollution and other pollutants such as pesticides

controlling contradictions among regulations the decade of the 1970s imposed environmental and health and safety regulations throughout the economy adding to the economic regulation equal opportunity regulation and other prior government regulation different parts of the environmental protection agency dictate how a company will handle its liquid gaseous and solid wastes while the occupational safety and health administration requires that workers be protected against harmful exposures to the chemicals although the depressed auto industry received national attention many other aspects of the economy are subject to contradictory regulations generated by the one at a time approach of congress to externalities although the more general analysis proposed by the author is more difficult to implement the effort is necessary 8 references

information and the divergence between willingness to accept and willingness to pay abstract there is considerable empirical and experimental evidence that there is a divergence between willingness to accept compensation to give up a good and willingness to pay to obtain a good this divergence persists even when the good in question is small relative to income a result in apparent conflict with standard economic theory this paper develops a theoretical bidding model with costly information acquisition to explain this divergence the model generates a gap between offers to sell and bids to buy consistent with the experimental results we argue that the model does a better job of explaining empirical and experimental data than either of the two commonly invoked theoretical explanations the endowment effect and the substitution effect

consumer s surplus without apology the purpose of this paper is to settle the controversy surrounding consumer s surplus and by so doing to validate its use as a tool of welfare economics i will show that observed consumer s surplus can be rigorously utilized to estimate the unobservable compensating and equivalent variations the correct theoretical measures of the welfare impact of changes in prices and income on an individual i derive precise upper and lower bounds on the percentage errors of approximating the compensating and equivalent variations with consumer s surplus these bounds can be explicitly calculated from observable demand data and it is clear that in most applications the error of approximation will be very small in fact the error will often be overshadowed by the errors involved in estimating the demand curve the results in no way depend upon arguments about the constancy of the marginal utility of income consequently this paper supplies specific empirical criteria which can replace the apologetic caveats frequently employed by those who presently apply consumer s surplus moreover the results imply that consumer s surplus is usually a very good approximation to the appropriate welfare measures to preview below i establish the validity of these rules of thumb for a

in search of complementarity in innovation strategy internal r d and external knowledge acquisition empirical research on complementarity between organizational design decisions has traditionally focused on the question of existence of complementarity in this paper we take a broader approach to the issue combining a productivity and an adoption approach while including a search for contextual variables in the firms strategy that affects complementarity analysis of contextual variables is not only interesting per se but also improves the productivity test for the existence of complementarity we use our empirical methodology to analyze complementarity between innovation activities internal research and development r d and external knowledge acquisition our results suggest that internal r d and external knowledge acquisition are complementary innovation activities but that the degree of complementarity is sensitive to other elements of the firms strategic environment we identify reliance on basic r dthe importance of universities and research centers as an information source for the innovation processas an important contextual variable affecting complementarity between internal and external innovation activities

willingness to pay and willingness to accept how much can they differ comment i agree with the point made by edoh y amiran and daniel a hagen 2003 that there can be a substantial or even infinite divergence between the wta and wtp for a public good even where there is a nonzero elasticity of substitution between market goods and the public good provided that the indifference curves are asymptotically bounded with respect to market goods in the manner they describe this is an important point they are also correct to point out that the elasticity of substitution is a local concept whereas their asymptotic boundedness condition applies also for discrete changes my 1991 paper used a local analysis because it was following the structure of the analysis in robert d willig 1976 and alan randall and john r stoll 1980 i wanted to show that while randall and stoll appeared to extend willig s local result on wta versus wtp from price changes to changes in the quantity of a public good the relevant elasticity was in fact different and involved the substitution elasticity as well as the income elasticity i view these points by amiran and hagen as not two separate results but essentially the same result their asymptotic boundedness condition generalizes my zero elasticity of substitution condition to discrete changes the asymptotic boundedness condition can be expressed as follows assuming a bivariate utility function u x q and given a reference point x q associated with a reference utility level u u x q there exists some q q such that for all q q there exists no x such that u x q u in other words no amount of x can substitute for the reduction in public good from q to q q in the case of a zero elasticity of substitution q q but as amiran and hagen show in their theorem 1 this is unnecessarily restrictive when dealing with a discrete reduction in q furthermore their theorem 2 can be viewed as a special case of their theorem 1 in which q 0 which makes q an essential commodity it is well known in consumer theory that the wta to avoid the loss of an essential market good is infinite their theorem 2 extends this result to the case of an essential nonmarket good but as their theorem 1 shows essentialness is not necessary for an infinite wta the boundedness condition is the key and this implies a fundamental lack of substitutability between money market goods and the public good

offshoring of r d looking abroad to improve innovation performance the offshoring of knowledge services has become a phenomenon of increasing importance for firms but many of its implications are yet to be discussed thoroughly this paper analyzes whether r d offshoring contributes to enhancing firms innovation capabilities specifically the study distinguishes between two governance models of offshoring captive offshoring and offshore outsourcing and two types of innovation outcomes product and process innovations we suggest that r d offshoring has different impacts depending on the innovation results and governance models considered the study empirically tests these relationships using the spanish technological innovation panel this survey contains information on a large sample of firms from diverse sectors for the period 2004 2007 the empirical findings allow us confirm our hypotheses and highlight the strategic importance of r d offshoring the empirical evidence reveals a positive relation between offshoring and innovation performance with a greater effect on product than on process innovations the results for different governance models show that captive offshoring has a greater effect on innovation outcomes than offshore outsourcing these findings lead us to conclude that firms that look overseas can benefit from location specific and specialization advantages to improve innovation performance

contingent valuation and social choice the contingent valuation method for estimating the existence value of natural resources is examined for psychophysical robustness statistical reliability and economic sensibility extensions of standard models for willingness to pay and suitable econometric techniques for analyzing these models are developed the analysis is applied to a series of experiments on the value of preserving wilderness areas in the western united states the results call into question the reliability of the cv method for estimating existence values

how firms innovate through r d internationalization an s curve hypothesis abstract this article examines the effects of r d internationalization and organizational slack on innovation performance we suggest that there is an s shaped relationship between r d internationalization and innovation performance innovation performance increases in the decentralization stage decreases in the transition stage and increases again in the recentralization stage in addition organizational slack is hypothesized to have a negative moderating effect on the s shaped relationship longitudinal data on 210 taiwanese firms in the information technology sector during a 10 year period is collected to test the hypotheses the findings support our prediction managerial implications and future research directions are discussed

real options and foreign affiliate divestments a portfolio perspective this paper develops a real options portfolio perspective on foreign affiliate divestments affiliates are less likely to be divested in response to adverse environmental change if they represent growth or switch option value to the multinational firm under conditions of macroeconomic uncertainty however the affiliate is partially redundant to the option value of the multinational firm s affiliate portfolio if the affiliate shares the manufacturing platform role in the host country with other affiliates or if macroeconomic conditions of the host country are highly correlated with those of other countries in which the multinational firm operates affiliates we find strong support for these arguments in tests on a comprehensive sample of 1078 asian manufacturing affiliates of japanese electronics multinationals

public good valuation and intra family allocation i derive values of marginal changes in a public good for two person households measured alternatively by household member i s willingness to pay wtp for the good on behalf of the household wtp i h or by the sum of individual wtp values across family members wtp c households are assumed to allocate their resources in efficient nash bargains over private and common household goods wtp i h is then defined by trade offs between the public good and the household good and wtp c by trade offs of between the public good and private goods wtp i h is found to be higher lower than wtp c when member i has a relatively high low marginal valuation of the public good but tends on average to equal wtp c as a consequence individuals tend to represent households correctly on average when questioned about the household s wtp for a public good even when they are purely selfish and answer truthfully adding all members wtp answers on behalf of the household then leads to double counting pure and paternalistic altruism the latter attached to consumption of the public good move each member s wtp on behalf of the household closer to the true sum of individual wtp but only paternalistic altruism raises this sum

the drivers of foreign direct investment into research and development an empirical investigation this paper examines the determinants of foreign direct investment fdi in research and development laboratories by 32 multinational enterprises in the pharmaceutical and electronics industries the paper applies a dichotomous set of motives for fdi results from an econometric analysis of 136 laboratory investments show that relative market size and relative strength of a country s science base determine whether fdi in research and development is carried out in order to exploit existing firm specific advantages or in order to build up new firm specific advantages this holds true in similar form for japanese european and u s firms and across the two industries

the relationship between the income elasticities of demand and willingness to pay abstract the relationship between income and willingness to pay for collectively provided public environmental goods is investigated we show that while the income elasticity of willingness to pay and the ordinary income elasticity of demand are related knowledge of one is insufficient to determine the magnitude or even the sign of the other the income elasticity of willingness to pay is influenced by additional factors which are generally unobservable examples are provided to illustrate the degree to which the two income elasticities may diverge our results indicate that even when goods are demand luxuries they may or may not have income elasticities of willingness to pay which are greater than one

testing the internal consistency of contingent valuation surveys abstract for an internal consistency check one can examine wtp responses to different surveys holding an environmental problem constant concave preferences imply wtpconcavein the success of a remedy the same preferences imply wtpconvexin the magnitude of an environmental problem assuming a successful remedy having opposite signed curvature of these two wtp patterns is general not requiring concave preferences for an adding up test an environmental commodity can be divided then wtp for one part plus wtp for the second part conditional on already having the first part equals wtp for the whole adjusted by an income effect

test retest reliability of contingent valuation with independent sample pretest and posttest control groups test retest the standard method used to investigate reliability of contingent valuation is limited because when the time period between the two surveys is relatively short the study may exhibit testing recall conversely when the time between the two surveys increases there is an increased chance the true value will change the test retest design cannot isolate these effects independent pretest and posttest control groups allow testing of reliability even when recall occurs or the true value changes using this design we found ex post estimates of hicksian surplus are reliable regardless of whether respondents have direct experience with an activity

test retest reliability of the contingent valuation method a comparison of general population and visitor responses the reliability of the contingent valuation method is evaluated by resurveying the same general households and visitors nine months after their original survey test retest correlations on willingness to pay are statistically significant and ranged from 422 for the general population sample to 782 for the visitor sample using a paired t test there was no statistical difference between an individual s first and second reported willingness to pay chow tests comparing the original and resurvey willingness to pay functions showed no statistical difference at the 01 level reported willingness to pay is reasonably stable over the time period surveyed

the multinational enterprise as a source of international knowledge flows direct evidence from italy this paper examines the determinants of technology transfer between parent firms and their international affiliates and of knowledge spillovers from those affiliates to host country firms using a unique data set of foreign multinational enterprise mne affiliates based in italy we find that affiliate investment in r d and investment in capital embodied technology plays a significant role in determining the nature of intra firm technology flows however the basis for any spillovers arising from mne affiliates does not originate from codified knowledge associated with r d but rather from the productivity of the affiliate

the forerunners of new monetary economics proposals to stabilize the unit of account note this paper critically evaluates the monetary policy regimes proposed by arthur kitson 1917 and henry meulen 1934 contrary to the assertion of tyler cowen and randall kroszner 1987 the unit of account envisioned by these earlier theorists was not at all like recent proposals by proponents of the new monetary economics it is also demonstrated that the compensated dollar plans of aneurin williams 1892 and irving fisher 1920 are closer forerunners to the recent new monetary economics proposals copyright 1990 by ohio state university press