reaction or interaction spatial process identification in multi tiered government structures abstract this paper models horizontal and vertical fiscal externalities in a multi tiered structure of government and implements maximum likelihood and instrumental variables estimation techniques to identify the source of spatial dependence in english local government expenditures the results show that when vertical fiscal externalities among upper tier county authority and lower tier district authority expenditures are explicitly taken into account the estimated magnitude of inter district fiscal interactions is substantially reduced the observed positive spatial autocorrelation among district expenditures can consequently be attributed to a large extent to common reaction to county fiscal policies rather than to actual strategic interaction

relative versus absolute income joy of winning and gender brain imaging evidence in this paper we study the role of absolute versus relative income using functional magnetic resonance imaging fmri while being scanned in two adjacent mri scanners pairs of subjects had to simultaneously perform a simple estimation task that entailed monetary rewards for correct answers we show that a variation in the comparison subject s payment affects blood oxygenation level dependent bold responses in the ventral striatum this brain region is engaged in the prediction and registration of primary rewards such as food delivery as well as more abstract forms of rewards like money in particular we show that activation in the ventral striatum increases in absolute income and for a given level of absolute income decreases in lower relative income using a male and a female sample allows us to study whether the perception of relative and absolute incomes is gender specific we find that the effects of absolute and relative incomes are strong and relatively similar for both genders finally we analyze the importance of joy of winning i e the impact of outperforming another subject our results suggest that the mere fact of outperforming the other subject positively affects reward related brain areas

performance comparisons and dynamic incentives it is well known that comparative performance information cpi can enhance efficiency in static principal agent relationships by improving the trade off between insurance and incentives in the design of explicit contracts in dynamic settings however there may be implicit as well as explicit incentives for example managerial career concerns and the ratchet effect in regulation we show that the dynamic effects of cpi on implicit incentives can either reinforce or oppose the familiar static insurance effect and in either case can be more important for efficiency the overall welfare effects of cpi are thus ambiguous and can be characterized in terms of the underlying information structure

peer pressure and partnerships partnerships and profit sharing are often claimed to motivate workers by giving them a share of the pie but in organizations of any significant size the free rider effects would seem to choke off

new urbanism and housing values a disaggregate assessment in this paper we attempt a formal analysis of the virtues of new urbanism a movement hailed as the most significant movement in urban planning and architecture in this century we proceed using the tools of geographic information systems gis to develop quantitative measures of urban form we then incorporate those measures in a hedonic price analysis we find that our measures of urban form capture meaningful differences in the characters of urban neighborhoods that could well have direct impacts on the utility of urban residents further we find that such differences are capitalized into residential property values the results imply that some but not all of the design features of new urbanism provide benefits for which urban residents are willing to pay

testing the taxmimicking versus expenditure spill over hypotheses using english data spatial interaction among local governments in tax setting and public spending decisions is receiving increasing attention in the applied public economics literature spatial interaction models rely on the presence of an externality from local budget making in traditional public finance models external effects originate either from interjurisdictional resource flows due to tax competition for a mobile base or from local public expenditure spill overs into neighbouring jurisdictions however the recent political agency yardstick competition literature has stressed the role of informational externalities between neighbouring jurisdictions and predicted tax mimicry at the local level the actual relevance of the above hypotheses clearly needs to be assessed empirically in this paper an attempt is made at discriminating between alternative sources of local fiscal interaction by using data on the english municipal authorities budgets while both public spending levels and local property tax rates ex

the economics of urban sprawl theory and evidence on the spatial sizes of cities many commentators believe that the phenomenon of urban sprawl which is characterized by vigorous spatial expansion of urban areas is a symptom of an economic system gone awry by transforming pastoral farmland into often unattractive suburbs sprawl is thought to disrupt a natural balance between urban and non urban land uses leading to a deplorable degradation of the landscape this sentiment is often translated into policy through zoning restrictions designed to inhibit the conversion of land from agricultural to urban use see bryant and conklin 1975 the economist s view of urban expansion stands in stark contrast to this emotionally charged indictment of sprawl economists believe that urban spatial size is determined by an orderly market process which correctly allocates land between urban and agricultural uses the model underlying this view which was originally developed by muth 1969 and mills 1972 and more completely analyzed by wheaton 1974 suggests that urban spatial size is determined in a straightforward way by a number of exogenous variables by showing empirically that urban size is related to the given variables population income agricultural rent and commuting cost in the manner predicted by the model the present paper achieves two goals first the empirical results suggest that the economist s view of urban sprawl is justified rather than being determined by a process which indiscriminately consumes agricultural land urban sizes are the result of an orderly market equilibrium where competing claims to the land are appropriately balanced 2 second by confirming the urban size predictions of the underlying model the empirical results constitute yet another piece of evidence validating the basic framework of urban economic analysis 3 the plan of the paper is as follows section ii sketches the structure of the muth mills model and presents the main comparative static results relevant to urban sprawl with the model s predictions in focus section iii discusses the sample and the data and section iv presents the empirical results section v offers conclusions

risky business the decline of defined benefit pensions and firms shifting of risk since the early 1980s employment in the united states has undergone significant transformation as the large corporations that once safeguarded employees with stable jobs and rewards for loyalty have replaced these employment relationships with ones based on cost containment and flexibility one important consequence of these developments is that firms have abdicated their role as a critical risk bearer in society although evidence suggests that firms have increasingly shifted market risks onto their workforce to date there have been few detailed analyses exploring what factors have driven this phenomenon this study adds to our understanding of why firms have transferred risk to their employees by examining the decline of a highly institutionalized practice wherein large u s firms used to bear retirement risk the defined benefit db pension plan through a detailed analysis i show that variance in the presence power and interests of shareholders and employees at the firm level differentially affect a firm s willingness to shift the risk of retirement onto its workers specifically i demonstrate empirically that different types of shareholders have differential effects on a firm s retirement practices suggesting that the changing equity ownership structure of large u s firms has played a key role in how risk is allocated between workers and firms declines in employee power have also played a role because firm levels of unionization positively affect rates of db participation for both unionized and nonunionized workers

population growth density and the costs of providing public services recent policy interest in managing local population growth has drawn attention to the fiscal pressures that population growth imposes on local governments this paper uses 1985 data for 247 large c

spatial patterns in local taxation tax mimicking or error mimicking this paper tests for mimicry in local tax setting by using a panel data set of the english non metropolitan districts in the 1980s when property tax rate variability across districts was highest the results confirm the presence of large and significant spatial interactions among districts even after allowing for district specific and time effects a district appears to be significantly affected by its neighbours policies a 10 increase in the local property tax rate of a district s neighbours leads to an increase of 4 5 in its own property tax rate on the other hand the absence of correlation in tax rates between lower tier district authorities and upper tier county authorities suggests that the spatial pattern in district tax rates is not simply driven by spatially auto correlated shocks

peer effects and incentives in a multi agent setting individuals often compare own performance with that of their peers these comparisons influence agents incentives and lead to a noncooperative game even if the agents have to complete independent tasks i show that depending on the interplay of the peer effects agents efforts are either strategic complements or strategic substitutes but the informativeness principle always applies i solve for the optimal monetary incentives that complement the peer effects in case of limited liability the principal may prefer to implement inefficiently large efforts although agents earn positive rents that increase in the respective agent s effort level

the electoral budget cycle on municipal waste collection expenditure abstractthis article analyses the determinants of municipal waste collection expenditure specifically the effects of electoral cycles on municipal waste collection expenditure we use a database with information on spanish municipalities with more than 1000 inhabitants for the period 2002 2011 our results reveal that incumbents adopt an opportunistic behaviour increasing spending on waste in the preelection year and reducing it in the election and post election years therefore we confirm an electoral budget cycle on waste collection expenditures in spain additionally we find that the levels of income unemployment and upper level governments transfers have a positive impact on waste collection spending finally population density level of urbanization average age of the population of the municipality and less fragmented governments negatively influence waste collection spending

what happened to long term employment the role of worker power and environmental turbulence in explaining declines in worker tenure recent declines in the average length of time that u s workers spend with a given employer represent an important change in the nature of the employment relationship yet it is one whose causes are poorly understood i explore those causes using current population survey data on the tenure of men aged 30 65 from the years 1979 2008 i argue that long term employment relationships primarily occur when workers pressure employers to close off employment from market competition reducing the attractiveness of external mobility relative to internal opportunities and increasing employment security i then explore how two changes in organizations environments a decline in union strength and increased turbulence from changes in technology and globalization might have affected workers ability to secure such closed employment relationships over the last 30 years my results support the argument that declines in tenure reflect the reduced power of workers to secure closed employment relationships recent declines in tenure have been concentrated in large organizations and many of those declines are explained by controlling for the changing levels of industry unionization i find little evidence that foreign competition or technological change affected mobility the results are robust to measures of changing industry growth rates and within industry reorganization supplementary analyses suggest that layoffs are associated with different industry pressures than tenure and that voluntary mobility may have played an important role in declines in tenure

does smart growth matter to public finance this paper addresses four fundamental questions about the relationship between smart growth a fiscally motivated anti sprawl policy movement and public finance do low density spatially extensive land use patterns cost more to support if so how large an influence does sprawl actually have how does the influence differ among types of spending and how does it compare with the influence of other relevant factors the analysis which is based on the entire continental us and uses a series of spatial econometric models to evaluate one aggregate total direct and nine disaggregate education fire protection housing and community development libraries parks and recreation police protection roadways sewerage and solid waste disposal measures of spending provides the most detailed evidence to date of how sprawl affects the vast sum of revenue that local governments spend every year

economic contests comparative reward schemes contests are situations in which an individual s reward depends on his performance relative to others students are graded on a curve the candidate with the most votes gets the political office the underling who performs best is promoted to the executive position contests are useful in dealing with indivisible rewards reducing monitoring costs and minimizing risks from common uncertainties they are employed to sort potential participants and once they have entered to induce appropriate effort from them with monitoring precision and prize spreads as potential choice variables optimal contest structures are derived for fair and unfair contests among equal and unequal participants the converse problems of climbing low ability individuals enter the contest designed for high ability candidates and slumming are shown to be manageable

here a chief there a chief the rise of the cfo in the american firm this article examines the rise of the chief financial officer cfo position among american firms during the period 1963 2000 building on event history models of cfo adoptions among a sample of some 400 large corporations this analysis documents two stages in the diffusion of the cfo model that occurred prior to its ultimate embodiment of the shareholder value ideal the cfo function originated as part of the conglomerate ideal to handle the funding of diversifying acquisitions in response to an ambiguous regulatory change in accounting rules in 1979 which threatened to reduce reported earnings further at a time when corporate earnings already were under great strain corporate leaders and finance professionals reconstructed the cfo as a solution the cfo s popularity quickly surged as a result and the role kept expanding in the following years to focus on managing shareholders and stock prices

the importance of local fiscal conditions in analyzing local labor markets a new test of the compensating wage differential model is proposed the logic behind roback s model which shows how differences in nonproduced amenities may be reflected in intercity wage differentials is extended to the case of differences in local fiscal conditions represented by tax rates and publicly produced services results show that differences in local tax rates and services provisions do generate compensating wage differentials across cities the effects of a particularly large set of taxes and effective services output measures are examined differences in local fiscal conditions are shown to play important roles in explaining the variance in intermetropolitan wages

causes of sprawl a portrait from space we study the extent to which u s urban development is sprawling and what determines differences in sprawl across space using remote sensing data to track the evolution of land use on a grid of 8 7 billion 30 30 meter cells we measure sprawl as the amount of undeveloped land surrounding an average urban dwelling the extent of sprawl remained roughly unchanged between 1976 and 1992 although it varied dramatically across metropolitan areas ground water availability temperate climate rugged terrain decentralized employment early public transport infrastructure uncertainty about metropolitan growth and unincorporated land in the urban fringe all increase sprawl

financialization and u s income inequality 1970 2008 focusing on u s nonfinance industries we examine the connection between financialization and rising income inequality we argue that the increasing reliance on earnings realized through financial channels decoupled the generation of surplus from production strengthening owners and elite workers negotiating power relative to other workers the result was an incremental exclusion of the general workforce from revenue generating and compensation setting processes using time series cross section data at the industry level we find that increasing dependence on financial income in the long run is associated with reducing labor s share of income increasing top executives share of compensation and increasing earnings dispersion among workers net of conventional explanations such as deunionization globalization technological change and capital investment the effects of financialization on all three dimensions of income inequality are substantial our counterfactual analysis suggests that financial

the spillover effects of state spending abstract this paper estimates the extent to which state spending is influenced by the spending of neighboring states examining several different metrics of neighborliness in order to better identify the channels for interstate spillovers it improves on previous studies by taking advantage of exogenous shocks to state medical spending to abstract from correlated local conditions and by allowing for spatial autocorrelation focusing on mandated increases in medical spending the analysis shows that each dollar of state spending causes spending in neighboring states to increase by almost 90 cents the most predictive measure of neighborliness is the degree of population mobility between states suggesting that rational concerns about adverse migration may drive the interdependence of state spending policy

testing the theory of tournaments an empirical analysis of broiler production broiler chickens are raised by contract growers whose rewards depend explicitly upon relative performance we use data on the performance of broiler producers facing both tournament and linear performance evaluation compensation structures to test three predictions from the theory of tournaments that changes in the level of prizes that leave prize differentials unchanged will not affect performance that in mixed tournaments more able players will choose less risky strategies and that tournament organizers will attempt to handicap players of unequal ability or reduce mixing to avoid the disincentive effects of mixed tournaments our evidence is consistent with each prediction

managerial incentive problems a dynamic perspective the paper studies how a person s concern for a future career may influence his or her incentives to put in effort or make decisions on the job in the model the person s productive abilities are revealed over time through observations of performance there are no explicit output contingent contracts but since the wage in each period is based on expected output and expected output depends on assessed ability an implicit contract links today s performance to future wages an incentive problem arises from the person s ability and desire to influence the learning process and therefore the wage process by taking unobserved actions that affect today s performance the fundamental incongruity in preferences is between the individual s concern for human capital returns and the firm s concern for financial returns the two need be only weakly related it is shown that career motives can be beneficial as well as detrimental depending on how well the two kinds of capital returns are aligned it is well understood by now that informational externalities may place special demands on the organization of economic exchange simple price mediated markets will frequently fail in the presence of asymmetric information in that case more elaborate contractual arrangements have to be used as substitutes for the price system lately considerable effort has been devoted to the analysis of contracting under incomplete information with the objective to understand the range of economic institutions that emerge in response to the failure of the price system the analysis of moral hazard has played a prominent role in this development moral hazard problems arise when for some reason or another transacting parties cannot contract contingent on the delivery of the good for instance in buying labour services it may be that the amount of labour supplied is not directly observable precluding a simple exchange of wage for labour as a partial remedy to this problem an imperfect mutually observed signal about the supply of labour can be used as a proxy in the contract frequently output is taken as such a proxy the drawback is that output is often influenced by other factors than labour input which induce undesirable risk into the contract one is therefore faced with a tradeoff between allocating risk associated with incomplete observability and providing incentives for a proper supply of labour gaining insight into this tradeoff is important not only for understanding contracting in the small e g managerial incentive schemes but also because it is closely related to the fundamental tension between equity and efficiency in the society as a whole while our understanding of moral hazard has advanced a lot in past years it is clear that much work remains an important question that has received little attention until

the impacts of state growth management programmes a comparative analysis this paper examines the impact that alternative state planning frameworks have on five dimensions of urban development density the spatial extent of urbanised land area property value public ex

budget spillovers and fiscal policy interdependence evidence from the states abstract this paper formalizes and tests the notion that states expenditures depend on the spending of similarly situated states we find that even after allowing for fixed state effects year effects and common random shocks among neighbors a state government s level of per capita expenditure is positively and significantly affected by the expenditure levels of its neighbors ceteris paribus a one dollar increase in a state s neighbors expenditures increases its own expenditure by over 70 cents

asymmetric tournaments equal opportunity laws and affirmative action some experimental results this paper assesses whether affirmative action programs and equal opportunity laws affect the output of economic agents more precisely we find that equal opportunity laws and affirmative action programs always benefit disadvantaged groups equal opportunity laws also increase the effort levels of all subjects and hence the profits of the tournament administrator usually the firm the effects of affirmative action programs depend on the severity of a group s cost disadvantage when the cost disadvantage is severe these programs significantly increase effort levels and hence profits the opposite is true when the disadvantage is slight

unions norms and the rise in u s wage inequality from 1973 to 2007 private sector union membership in the united states declined from 34 to 8 percent for men and from 16 to 6 percent for women during this period inequality in hourly wages increased by over 40 percent we report a decomposition relating rising inequality to the union wage distribution s shrinking weight we argue that unions helped institutionalize norms of equity reducing the dispersion of nonunion wages in highly unionized regions and industries accounting for unions effect on union and nonunion wages suggests that the decline of organized labor explains a fifth to a third of the growth in inequality an effect comparable to the growing stratification of wages by education

the role of pensions in the labor market a survey of the literature because employer sponsored group pension plans entail agreements between workers and their employers explicitly linking future payment and employment they offer an unusual window into long term employment relationships this review of recent research on pensions explores how pensions influence employee compensation retirement turnover and other matters central to the determination of labor s price and quantity over time the authors also outline some unanswered questions and difficult to reconcile findings because the pension promise involves an explicit and relatively well documented set of statements regarding future contingent payment and employment an examination of the design and operation of employersponsored group pension plans can yield important insights into the long term employment relationship specifically pension research illuminates some important labor market questions in two ways it offers insight into an important element of compensation in its own right and it furthers our understanding of labor markets in which long term

business ties and proxy voting by mutual funds abstract the magnitude of mutual funds business ties with their portfolio firms is documented and is linked to funds proxy votes at specific firms and to overall voting practices aggregate votes at the fund family level indicate a positive relation between business ties and the propensity to vote with management votes at specific firms however reveal that funds are no more likely to vote with management of client firms than of non clients because the votes took place when funds knew their votes would be publicly scrutinized fund families with a larger client base may have adopted voting policies that led to less frequent opposition to management at all firms

expenditure spillovers and fiscal interactions empirical evidence from local governments in spain abstract the paper presents a framework for measuring spillovers resulting from local expenditure policies we identify and test for two different types of expenditure spillovers i benefit spillovers arising from the provision of local public goods and ii crowding spillovers arising from the crowding of facilities by residents in neighboring jurisdictions benefit spillovers are accounted for by assuming that the representative resident enjoys the consumption of a local public good in both his own community and in those surrounding it crowding spillovers are included by considering that a locality s consumption level is influenced by the population living in the surrounding localities we estimate a reaction function with interactions between local governments occurring not only between expenditure levels but also between neighbors populations and expenditures the equation is estimated using data on more than 2500 spanish local governments for the year 1999 the results show that both types of spillovers are relevant

do new brooms sweep clean when and why dismissing a manager increases the subordinates performance abstract if a manager stays in office for a long time he will have learned much about his subordinates thus competition among them will be weak as the manager has made up his mind who is suited best for which position with a new manager the race for favorable tasks is restarted leading subordinates to exert higher effort but for the firm owner the trade off arises that with a new manager effort is larger but the quality of task allocation is worse since information is lost the optimal dismissal policy will be nonmonotonic in the expected heterogeneity of the subordinates abilities

fringe benefits and labor mobility interindustry factor mobility is a crucial determinant of the income distribution effects of exogenous changes in relative commodity prices this examination of interindustry variation in wages and profits using data from manufacturing industries from

revenge of the managers labor cost cutting and the paradoxical resurgence of managerialism in the shareholder value era 1984 to 2001 institutional changes associated with the rise of shareholder value capitalism have had seemingly contradictory effects on managers and managerialism in the united states economy financial critiqu

work incentives hierarchy and internal labor markets this paper argues that contracts with payment based on a ranking of employee performance can provide performance incentives even under asymmetric information that prevents payment based on individual performance only being enforceable such contracts also fit with five features of labor markets that have aroused considerable interest 1 hierarchical wage structures 2 internal promotion 3 wage rates that rise with seniority and experience more than productivity 4 the variance of earnings increasing with experience and 5 wage rates attached to jobs rather than individuals with differentials set by administrative procedures rather than by reference to external market wages

is there discretion in wage setting a test using takeover legislation anecdotal evidence suggests that uncontrolled managers let wages rise above competitive levels testing this popular perception has proven difficult however because independent variation in the extent of managerial discretion is needed in this paper we use states passage of anti takeover legislation as a source of such independent variation passed in the 1980s these laws seriously limited takeovers of firms incorporated in legislating states since many view hostile takeovers as an important disciplining device these laws potentially raised managerial discretion in affected firms if uncontrolled managers pay higher wages we expect wages to rise following these laws using firm level data we find that relative to a control group annual wages for firms incorporated in states passing laws did indeed rise by 1 to 2 or about 500 per year the findings are robust to a battery of specification checks and do not appear to be contaminated by the political economy of the laws or other sources of bias our results suggest that discretion significantly affects wages they challenge standard theories of wage determination which ignore the role of managerial preferences

testing for strategic interaction among local governments the case of growth controls this paper helps to fill a gap in the public economics literature by providing empirical evidence on strategic interaction among local governments using the methodology of case et al journal of public economics 52 285 307 1993 the paper focuses on the adoption of growth control measures by cities in california and looks for evidence of policy interdependence in these choices the data are drawn from an elaborate survey of growth control practices in california cities conducted by glickfeld and levine regional growth local reaction lincoln institute of land policy cambridge ma 1992 the survey results are used to compute an index of the stringency of growth controls in each city which serves as the dependent variable for the study

in search of yardstick competition a spatial analysis of italian municipality property tax setting this paper uses italian local government data to test for fiscal interaction arising from yardstick competition to discriminate yardstick competition from competing theories of strategic interaction we account for the incentives and constraints generated by the electoral system in particular for the presence of term limits and the size of the majorities supporting the mayors estimation of a local property tax setting equation uncovers positive spatial auto correlation in local tax rates of jurisdictions where the mayors run for re election in uncertain contests while interaction is absent where either mayors face a term limit or are backed by large majorities

progressive taxation in a tournament economy abstract not enough is known about the responsiveness of individuals in particular those who work under different incentives to changes in marginal tax rates we ask whether changes in tax rates are less distortionary for workers engaged in a contest to examine this potential rationale for a more progressive tax code we first model the effort decisions of workers faced with progressive taxation under tournaments and piece rates because of the difficulty identifying any distortion that may be induced by the tax code in naturally occurring data we then report on the results of a real effort experiment based on this model consistent with a behavioral approach to public finance we find that competitive tournament workers are less sensitive and hint in our discussion at the possible welfare benefits of progressive taxation in tournament economies

infrastructure financing and urban development abstract historically additions to public infrastructure necessitated by urban growth have been financed under a cost sharing approach in the last several decades however financing of growth has increasingly relied on land use exactions where new residents pay for the cost of incremental infrastructure despite the emergence of a formal growth control literature there has been virtually no formal analysis of the connection between infrastructure financing and urban development to provide such an analysis this paper investigates three different schemes for financing incremental infrastructure within an urban growth model the analysis compares an impact fee scheme to two types of cost sharing schemes deriving the effects on urban growth and land values of switching to the impact fee scheme the efficient financing scheme is also identified

executive compensation and tournament theory empirical tests on danish data this article adds to the empirical literature on tournament theory as a theory of executive compensation i test several propositions of tournament models on a rich data set containing information about 2 600 executives in 210 danish firms during a 4 year period i ask are pay differentials between job levels consistent with relative compensation is pay dispersion between levels higher in noisy environments is the dispersion affected by the number of tournament participants is average pay lower in firms with more compressed pay structures does wider pay dispersion enhance firm performance most of the predictions gain support in the data

choice under uncertainty problems solved and unsolved ffifteen years ago the theory of choice under uncertainty could be considered one of the success stories of economic analysis it rested on solid axiomatic foundations it had seen important breakthroughs in the analytics of risk risk aversion and their applications to economic issues and it stood ready to provide the theoretical underpinnings for the newly emerging information revolution in economics 1 today choice under uncertainty is a field in flux the standard theory is being challenged on several grounds from both within and outside economics the nature of these challenges and of our profession s responses to them is the topic of this paper

promotions and incentives the case of multistage elimination tournaments promotions play an important role for the provision of incentives in firms we analyze incentives in multistage elimination tournaments with controlled laboratory experiments in our two main treatments we compare a two stage tournament to a one stage tournament subjects in the two stage treatment provide excess effort in the first stage both with respect to nash predictions and compared to the strategically equivalent one stage tournament additional control treatments confirm that excess effort in early stages is a robust finding and suggest that above equilibrium effort might be driven by limited degrees of forward looking behavior and subjects deriving nonmonetary value from competing

the importance of relative performance feedback information evidence from a natural experiment using high school students we study the effect of providing relative performance feedback information on performance under piece rate incentives a natural experiment that took place in a high school offers an unusual opportunity to test this effect in a real effort setting for one year only students received information that allowed them to know whether they were above below the class average as well as the distance from this average we exploit a rich panel data set and find that the provision of this information led to an increase of 5 in students grades moreover the effect was significant for the whole distribution however once the information was removed the effect disappeared to rule out the concern that the effect may be driven by teachers within the school we verify our results using national level exams externally graded for the same students and the effect remains

spatial interaction model of spillovers from locally provided public services lundberg j 2006 spatial interaction model of spillovers from locally provided public services regional studies 40 631 644 this paper tests the hypotheses that recreational and cultural services provided at the local government level in sweden are associated with spillovers between municipalities a representative voter model is derived and the demand for recreational and cultural services is estimated using spatial sur techniques the result suggests a negative correlation between recreational and cultural services provided by neighbouring municipalities that indicate that these services are associated with spillovers in terms of strategic behaviour this result suggests that these services are strategic substitutes moreover the results provide week evidence that recreational and cultural services provided by local governments are complements lundberg j 2006 un modele d interaction geographique des retombees des services publics locaux regional studies 40 631 644 cet article cherche a test

through the contested terrain implementation of downsizing announcements by large u s firms 1984 to 2005 since the 1980s leading u s firms have announced massive downsizing plans in the name of maximizing shareholder value but some observers are skeptical about how serious firms are in implementing

public open space conservation under a budget constraint abstract this paper analyzes the fiscal and land value impacts of public open space conservation in a budget constrained city it derives the necessary and sufficient conditions for open space conservation to increase the level of municipal services and the total land value within the city the theoretical results together with the empirical evidence found in the literature suggest that open space conservation can increase the level of municipal services and total land value in a significant share of american cities even if it generates no amenities open space conservation will likely increase total land values and municipal services in metropolitan areas that have stringent land use regulations high development densities and relatively little open space but will likely reduce municipal services and total land values in small lightly regulated cities surrounded by rural land and fiscally constrained in providing essential public goods h4 r3 q2

growing apart the changing firm size wage premium and its inequality consequences wage inequality in the united states has risen dramatically over the past few decades prompting scholars to develop a number of theoretical accounts for the upward trend this study argues that large firms have been a prominent labor market institution that mitigates inequality by compensating their low and middle wage employees with a greater premium than their higher wage counterparts large u s firms reduced overall wage dispersion yet broader changes to employment relations associated with the demise of internal labor markets and the emergence of alternative employment arrangements have undermined large firms role as an equalizing institution using data from the current population survey and the survey of income and program participation we find that in 1989 although all private sector workers benefited from a firm size wage premium the premium was significantly higher for individuals at the lower end and middle of the wage distribution compared to those at the higher end between 1989 and

the loser s curse if the value of a commodity is unknown a prospective buyer must realize that a bid based on an overestimate of its value is likely to be accepted in this situation merely finding out that one s bid is accepted may cause one to reduce the estimate of a commodity s value so winning an auction can bring a feeling of regret 1 acceptance of a bid is an informative event and failure to incorporate this contingent information into the bidding strategy can lead to excessive bids and subsequent losses a result widely known as the winner s curse 2 there is considerable anecdotal evidence that bidders for a prize of uncertain value fall prey to the winner s curse and persistent overbidding has also been observed in laboratory experiments 3 there is a second factor that can also induce overbidding the thrill of winning this raises the possibility that overbidding is due to a utility of winning instead of being the result of an irrational failure to anticipate the informational content of a bid s acceptance one way to distinguish these explanations is to examine a situation in which the winner s curse effect is neutralized to see if bids are still too high in order to neutralize the winner s curse we identify an opposing bias a situation in which a failure to anticipate the informational content of a bid s acceptance will cause one to bid below the optimal bid resulting in a loser s curse since the loser s curse produces underbidding its effect is the opposite of that arising from the winner s curse

emotions in tournaments abstract we introduce a concept of emotions that emerge when agents compare their own performance with the performances of other agents assuming heterogeneity among the agents the interplay of emotions and incentives is analyzed within the framework of rank order tournaments which are frequently used in practice tournaments seem to be an appropriate starting point for this concept because a tournament induces incentives by making agents compare themselves with their opponents we identify certain conditions under which the principal benefits from emotional agents furthermore the concept of emotions is used to explain the puzzling findings on the oversupply of effort in experimental tournaments