do vietnamese upland farmers benefit from high world market prices for maize for rural households in the north of vietnam maize cropping is the main source of income in the face of the world market price increases of the recent past we analyze the regional marketing chain of this commodity qualitatively and econometrically investigating to what extent smallholder farmers in developing countries are affected by international price movements vietnamese maize markets are found to be well integrated recent price hikes have fully transmitted along the regional supply chain so that farmers profited nevertheless adverse factors such as increasing input prices have neutralized these benefits resulting in a decline in real income of smallholders

food price transmission and economic development in this paper we challenge the conventional wisdom that the world s poorest countries are also the most vulnerable to spikes in international food prices we derive an inverted u shaped relationshi

does smoking affect schooling evidence from teenagers in rural china youth smoking can biologically reduce learning productivity it can also reduce youths expected returns to education and lower their motivation to go to school where smoking is forbidden using rich household survey data from rural china this study investigates the effect of youth smoking on educational outcomes youth smoking is clearly an endogenous variable to obtain consistent estimates of its impact we use counts of registered alcohol vendors and a food price index as instrumental variables since the variable that measures smoking behavior is censored for non smoking adolescents we implement a two step estimation strategy to account for the censored nature of this endogenous regressor the estimates indicate that smoking one cigarette per day during adolescence can lower students scores on mathematics tests by about 0 08 standard deviations however we find no significant effect of youth smoking on either chinese test scores or total years of schooling

women s work and economic development using a cross country dataset and microdata from india and thailand we examine how women s work status changes with economic development several clear patterns emerge women s labor force participation first declines and then rises with development women move from work in family enterprises to work as paid employees fertility declines and gender gaps in education narrow women s education levels and those of their spouses appear to be important determinants of women s labor market activities broad welfare indicators such as mortality rates and education levels indicate that women s well being improves on average with development both in absolute terms and relative to men

estimating dynamic demand for cigarettes using panel data the effects of bootlegging taxation and advertising reconsidered abstracct a dynamic demand for cigarette consumption is estimated using pooled data of 46 states over the period 1963 to 1980 a price elasticity of 0 2 and an insignificant income elasticity is found using pooled estimation techniques the bootlegging effect is modeled explicitly using neighboring price the effect is found to be significant two major policy issues are analyzed in light of these new estimates 1 cigarette taxation is found to be an effective tool for generating revenues even though there may be spillover effects to neighboring states where bootlegging is significant 2 the effects of the fairness doctrine act and the advertising ban on cigarette consumption are re examined we find mild support for the effectiveness of subsidized anti smoking messages in reducing cigarette consumption and no support for the thesis that the ban on advertising helps to increase per capita consumption

the hyperbolic consumption model calibration simulation and empirical evaluation ur preferences for the long run tend to conflict with our short run behavior when planning for the long run we intend to meet our deadlines exercise regularly and eat healthfully but in the short run we have little interest in revising manuscripts jogging on the stairmaster and skipping the chocolate souffleala mode delay of gratification is a nice long term goal but instant gratification is disconcertingly tempting this gap between long run intentions and short run actions is apparent across a wide range of behaviors including saving choices a 1997 survey found that 76 percent of respondents believe they should be saving more for retirement looking only at respondents who believed they were at an age where you should be seriously saving already the survey found that 55 percent reported being behind in their savings and only 6 percent reported being ahead farkas and johnson 1997 the report on the survey concluded t he gaps between people s atti tudes intentions and behavior are troubling and threaten increased insecurity and dissatisfaction for people when they retire americans are simply not doing what logic and their own reasoning suggests they should be doing a 1993 luntz webber merrill lynch survey found similar answers when baby boomers were asked what percentage of your annual household income do you think you should save for retirement and what percentage of your annual

agricultural household models extensions applications and policy this book presents the basic model of an agricultural household that underlies most of the case studies undertaken so far the model assumes that households are price takers and is therefore recursive the decisions modeled include those affecting production and the demand for inputs and those affecting consumption and the supply of labor comparative results on selected elasticities are presented for a number of economies the empirical significance of the approach is demonstrated in a comparison of models that treat production and consumption decisions separately and those in which the decisionmaking process is recursive the book summarizes the implications of agricultural pricing policy for the welfare of farm households marketed surplus the demand for nonagricultural goods and services the rural labor market budget revenues and foreign exchange earnings in addition it is shown that the basic model can be extended in order to explore the effects of government policy on crop composition nutritional status health saving and investment and to provide a more comprehensive analysis of the effects on budget revenues and foreign exchange earnings methodological topics primarily the data requirements of the basic model and its extensions along with aggregation market interaction uncertainty and market imperfections are discussed the most important methodological issues the question of the recursive property of these models is also discussed

the potential for using excise taxes to reduce smoking we examine the potential for reducing cigarette smoking through increases in cigarette excise taxes by estimating the price elasticity of demand for cigarettes using information on individual smoking behavior from the 1976 health interview survey we estimate the adult price elasticity of demand for cigarettes to be 0 42 we find that price has its greatest effect on the smoking behavior of young males and that it operates primarily on the decision to smoke rather than via adjustments in the quantity of cigarettes smoked an excise tax increase would discourage smoking by successive cohorts of young adults and those reduced smoking levels would be reflected in aggregate smoking as these cohorts mature

a farm household model for agri food policy analysis in developing countries application to smallholder farmers in sierra leone this paper presents a generic farm household model for use in the context of developing countries to gain knowledge on food security and rural poverty alleviation under different policy options it is a static positive programming model which simultaneously solves a set of microeconomic farm models reproducing the behaviour of representative individual farm households this model is designed to capture key features of developing countries agriculture such as the non separability of production and consumption decisions due to market imperfections the inter linkage between transaction costs and market participation decisions the interaction among farm households for factor markets and the seasonality of resource use model use is illustrated in this paper by simulating the impact of rice seed policy on the livelihood of representative smallholder farmers in sierra leone results show that the seed policy would improve farm productivity and boost household income but that it is not sufficient to fight poverty since 90 of the surveyed farm households would continue to live below the extreme poverty line of 1 usd equivalent per person per day

is addiction rational theory and evidence this paper makes two contributions to the modeling of addiction first we provide new and convincing evidence that smokers are forward looking in their smoking decisions using state excise tax increases that have been legislatively enacted but are not yet effective and monthly data on consumption second we recognize the strong evidence that preferences with respect to smoking are time inconsistent with individuals both not recognizing the true dife culty of quitting and searching for self control devices to help them quit we develop a new model of addictive behavior that takes as its starting point the standard rational addiction model but incorporates time inconsistent preferences this model also exhibits forward looking behavior but it has strikingly different normative implications in this case optimal government policy should depend not only on the externalities that smokers impose on others but also on the internalities imposed by smokers on themselves we estimate that the optimal tax per pack of cigarettes should be at least one dollar higher under our formulation than in the rational addiction case

tax incidence when individuals are time inconsistent the case of cigarette excise taxes abstract one of the most cogent criticisms of excise taxes is their regressivity with lower income groups spending a much larger share of their income on goods such as cigarettes than do higher income groups we argue that traditional quantity based measures of incidence are only appropriate under a very restrictive time consistent model of consumption of sin goods a model that is much more consistent with existing evidence on smoking decisions is a time inconsistent formulation where excise taxes on cigarettes serve a self control function that is valued by smokers who would like to quit but cannot this self control function benefits lower income groups more since they have a significantly higher price sensitivity of smoking calibrations show that as a result cigarette taxes are much less regressive than previously assumed and are even progressive for a wide variety of parameter values

how do export controls affect price transmission and volatility spillovers in the ukrainian wheat and flour markets abstract this study investigates the impact of export controls implemented on ukrainian wheat during two periods of significant commodity price spikes and volatility first we investigate the equilibrium price relationship between wheat and flour prices to identify whether export restrictions dampened the price transmission from the wheat market to the flour market second we estimate an asymmetric vec bekk garch model to characterize the nature of short run price adjustments and volatility spillovers between the ukrainian wheat and flour markets the results indicate that export controls insulated the flour market from price shocks in the wheat market by reducing the transmission elasticity by 25 we also find evidence that suggests export controls lead to increased volatility in the flour market in the periods immediately before and after the export controls however we find no evidence that the export controls increase the time invariant i e the constant part of volatility of wheat or flour prices lastly we do not observe asymmetric spillover effects in the flour market but we do find that the wheat market is more volatile when experiencing positive shocks than negative ones

the political economy of food price volatility the case of vietnam and rice this article argues that the structure of the vietnamese rice export system is in political economy terms a rational response to the volatility present in the international rice market in particular it is argued that the vietnamese food agency along with vinafood 1 and vinafood 2 have been structured so that they can benefit from the domestic demands for export restrictions anticipated to occur as a consequence of international price volatility and the psychological demand of consumers for price stability in turn the actions of these agencies also contribute to international price volatility and the resulting demand for export restrictions since the political and economic elite in vietnam obtain both political and economic power from this system it is unlikely to be replaced with more effective and efficient policies to combat domestic price volatility thus continued volatility in the price of rice can be expected

cigarette smoking and self control this paper empirically studies time inconsistent preferences in the context of cigarette smoking behavior with hyperbolic discounting an individual has time inconsistent preferences which give rise to a lack of self control i e she may perpetually postpone the execution of a plan this implies that a smoker who wants to quit has a demand for control devices e g a smoking ban in public areas or a hike in cigarette excise taxes this paper empirically tests this implication using a sample that is based on survey data from taiwan the estimation results indicate that a smoker s intention to quit has a positive effect on the smoker s support for smoking bans and a cigarette excise tax increase these results lend support to the validity of the time inconsistent preferences in the context of cigarette smoking behavior this casts doubt on the validity of the assumption that individuals have time consistent preferences in becker and murphy s becker g s murphy k m 1988 a theory of rational addiction journal of political economy 96 4 675 700 rational addiction model

subsistence and semi subsistence farming in selected eu new member states factor and cluster analysis are used to analyse the attitudes and perceptions of agricultural households in five eu new member states towards farming commercialisation and barriers to and drivers for an increased integration in agricultural markets the contribution of unsold output to the total household income is valued a stepwise linear regression is employed to detect important variables explaining the degree of agricultural market integration of farm households the analysis indicates that subsistence farming is of utmost importance for the rural poor and particularly in bulgaria and romania the proportion of consumption from own production manual cultivation techniques and distance to an urban centre negatively affect output sales rural development policies targeted at rural physical and market infrastructure might relieve some of these constraints

a theory of rational addiction we develop a theory of rational addiction in which rationality means a consistent plan to maximize utility over time strong addiction to a good requires a big effect of past consumption of the good on current consumption such powerful complementarities cause some steady states to be unstable they are an important part of our analysis because even small deviations from the consumption at an unstable steady state can lead to large cumulative rises over time in addictive consumption or to rapid falls in consumption to abstention our theory also implies that cold turkey is used to end strong addictions that addicts often go on binges that addicts respond more to permanent than to temporary changes in prices of addictive goods and that anxiety and tensions can precipitate an addiction

price policy poverty and power within rural west african households abstract this paper explores the impact of agricultural price policy on poverty in west africa a region in which prices are an important tool for raising rural household incomes a game theoretic collective model of household income generation and resource allocation is developed that incorporates three features typical of west african rural households preference heterogeneity among women and men individual resource control and power mediated bargaining over resource control in the face of changes in households economic environments to explore price effects the model is used to simulate the income impacts of large increases in cotton prices accompanying fast paced agricultural liberalisation in burkina faso in the 1980s the paper shows that where resources are controlled individually by household members rather than pooled pareto efficiency in income generation does not hold the impact of agricultural price policy on poverty is mediated by bargaining over resource control within households bo

re evaluating the role of energy efficiency standards a behavioral economics approach abstract the economic models that prescribe pigovian taxation as the first best means of reducing energy related externalities are typically based on the neoclassical model of rational consumer choice yet consumer behavior in markets for energy using durables is generally thought to be far from efficient giving rise to the concept of the energy efficiency gap this paper presents a welfare analysis of energy policies that is based on a behavioral model of temptation and self control introduced by gul and pesendorfer 23 24 we find that in the presence of temptation i pigovian taxes alone do not yield a first best outcome ii when viewed as substitutes energy efficiency standards can dominate pigovian taxes and iii a policy combining standards with a pigovian tax can yield higher social welfare than a pigovian tax alone implying that the two instruments should be viewed as complements rather than substitutes

global market shocks and poverty in vietnam the case of rice world food prices have experienced dramatic increases in recent years these shocks affect food importers and exporters alike vietnam is a major exporter of rice and rice is also a key item in domestic production employment and consumption accordingly rice price shocks from the world market have general equilibrium impacts and as such their implications for household welfare are not known ex ante in this paper we first present a simple framework for understanding the direct and indirect welfare effects of a global market shock of this kind second we quantify the transmission of the price shock from global indicator prices to domestic markets third we then we use an applied general equilibrium age model to simulate the effects of domestic price changes in more detail fourth a recursive mapping to a large nationally representative living standards survey permits us to identify in detail the ceteris paribus effects of the shock on household incomes and welfare in this analysis interregional and intersectoral adjustments in the labor market emerge as key channels transmitting the effects of global price shocks across sectors and among households

social influence and collective action effects on farm level soil conservation effort in rural kenya abstract this paper analyzes the effects of social influence and participation in collective action initiatives on soil conservation effort among smallholder farmers in lake naivasha basin kenya we apply binary and ordered probit models in a two stage regression procedure to cross sectional data collected through a household survey among randomly selected smallholder farmers smallholder farming systems in the research area are associated with practices that render farmlands susceptible to soil erosion causing negative impacts on land and the environment therefore strategies that encourage soil conservation are likely to also offer solutions for dealing with agri environmental challenges and poverty alleviation results indicate that social capital facilitates participation in collective action initiatives which then influence individual soil conservation efforts neighborhood social influences subjective norms gender education level farm size access to credit and livestock ownership also emerge as key determinants of soil conservation effort policy implications drawn by this study encourage strategies to increase participation and effectiveness in collective action initiatives as a boost to soil conservation implementation of soil conservation practices could also be encouraged through awareness increasing instruments facilitating access to agricultural micro credit and paying attention to gender related challenges on knowledge access and rights over land and other natural resources

inefficiency of male and female labor supply in agricultural households evidence from uganda this article analyzes the efficiency of the intra household allocation of female and male labor inputs in agricultural production in a collective household model spouses optimal on farm labor supply is such that the marginal rate of technical substitution between male and female labor is equated over different crops using the uganda national household survey 2005 06 we test whether this condition holds by estimating production functions and controlling for endogeneity using a method proposed by gandhi navarro and rivers 2009 we find that women are less productive than men that there is more female labor input on low productivity parcels and that men are relatively more productive on female controlled plots compared with male controlled plots total farm output could be higher and pareto improvements could be possible if male labor was reallocated to female controlled plots and or female labor was reallocated to male controlled plots

ignorance in a multi agent setting abstract i extend the demski and sappington 1984 model to the case where the agents are with some exogenous probability ignorant i show that an ignorant agent either is not exposed to risk or he receives a lower transfer when the other agent is the informed type the principal wants to discourage choosing the contract designed for an ignorant agent

discounting the distant future an experimental investigation we use a laboratory experiment to elicit discount rates over a 20 year time horizon using government savings bonds as a payment vehicle when using a constant exponential discount rate function we find an implied average discount rate of 4 9 which is much lower than has been found in previous experimental studies that used time horizons of days or months however we also find strong support for non constant declining discount rates for longer time horizons with an extrapolated implied annual discount rate approaching 0 5 in 100 years there is heterogeneity in discount rates and risk preferences in that people with more optimistic beliefs about technological progress have higher discount rates these findings contribute to the debate over the appropriate discount rate to use in comparing the long term benefits of climate change mitigation to the more immediate costs

the impact of food price increases on caloric intake in china world food prices have increased dramatically in recent years we use panel data from 2006 to examine the impact of these increases on the consumption and nutrition of poor households in two chinese provinces we find that households in hunan suffered no nutrition declines households in gansu experienced a small decline in calories though the decline is on par with usual seasonal effects the overall nutritional impact of the world price increase was small because households were able to substitute to cheaper foods and because the domestic prices of staple foods remained low due to government intervention in grain markets

analysis of food demand in vietnam and short term impacts of market shocks on quantity and calorie consumption a complete demand system for vietnam was estimated using household survey data results showed that demand for rice with respect to prices and expenditure is relatively inelastic compared to other foods demand for food in general tends to be less elastic at higher levels of income and for urban households in the short term a market shock such as a 10 decrease in income or a 30 increase in rice prices forces households to spend a larger portion of their expenditure on rice at the expense of other foods low income households face a higher risk of undernourishment as their daily calorie intake is more negatively affected by the shocks than high income households the results suggest the importance of policies that provide necessary safety net programs for the poor

production externalities and two way distortion in principal multi agent problems this paper studies an otherwise standard principal agent problem with hidden information but where there are positive production externalities between agents the output of any agent depends positively on the effort expended by other agents it is shown that the optimal contract for the principal exhibits two way distortion the effort of any agent is oversupplied relative to the first best when his marginal cost of effort is low and undersupplied taken his marginal cost of effort is high this pattern of distortion cannot otherwise arise in optimal single or multi agent incentive contracts unless there are countervailing incentives however unlike the countervailing incentives case the pattern of distortion we find is robust to the precise form of the externality journal of economic literature classification numbers d21 d28 c 2000 academic press

discount rates inferred from decisions an experimental study two hundred and four students of economics and finance participated in an intertemporal choice experiment which manipulated three dimensions in a 4 4 4 factorial design scenario postponing a receipt postponing a payment expediting a receipt expediting a payment time delay 0 5 1 2 and 4 years and size of cashflow 40 200 1000 and 5000 individual discount rates were inferred from the responses and then used to test competitively four hypotheses regarding the behavior of discount rates the classical hypothesis asserting that the discount rate is uniform across scenarios time delays and sums of cashflow was flatly rejected a market segmentation approach was found lacking the results support an implicit risk hypothesis according to which delayed consequences are associated with an implicit risk value and an added compensation hypothesis which asserts that individuals require compensation for a change in their financial position

rice prices and income distribution in thailand a non parametric analysis rice is a staple crop in thailand significantly entering both household production and consumption this paper examines the effect of rice prices on the distribution of real income across households taking into account household characteristics and geographical location the data set is a large scale survey of 11 893 households simple nonparametric techniques for regression and density estimation are used these methods depend on few assumptions and generate flexible graphical results that are directly informative about the problem at hand the main results are that higher rice prices should benefit all rural households but the largest benefits accrue to rural households in the middle of the income distribution copyright 1989 by royal economic society

does traditional price policy work for achieving low smoking rate empirical and theoretical evaluation based on the united states aggregate data in the united states smoking has been strictly restricted by both federal and state governments almost all the policies have imposed high tax on cigarettes for decreasing the number of smokers i

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

global rice trade competitiveness a shift share analysis changes in country shares of global rice exports from 1997 to 2008 are analyzed using an econometric shift share analytical framework this framework estimates growth rates and disaggregates these rates of change into geographical structure effects and performance effects the performance effect is further decomposed into two subeffects accounting for adaptation to changes in the geographical structure of the marketplace and a competitiveness effect a restricted weighted two way fixed effects model is specified for estimating the geographical structure and performance effects results indicate a growing concentration among a few exporting countries in the global rice market and the competitiveness effect is often significant government policies affecting rice trade and the competitiveness of trading partners are important factors for the shifts in rice trade patterns in particular vietnam is an emerging major player in global rice trade in competition with thailand

world food prices and poverty incidence in a food exporting country a multihousehold general equilibrium analysis for thailand a multisectoral multihousehold general equilibrium model of the thai economy is used to analyze the implications of recent increases in international food prices higher food prices especially staple grains worsen poverty incidence in thailand despite the presence of large numbers of poor farmers many of whom benefit from higher prices the positive effect on the welfare of poor farmers is dominated by the negative effect on poor consumers of the recent price increases for rice sugar cassava maize soybeans urea and petroleum the increases in rice prices raise poverty incidence the most despite thailand being the world s largest rice exporter

inter provincial migration and inequality during vietnam s transition abstract vietnam s economic boom during the transition to a market economy has centered on very rapid growth in some sectors and provinces yet poverty has diminished across the entire country with capital investments highly concentrated by province and sector geographic labor mobility may be critical in spreading the gains from growth conversely rising income inequality may be attributable in part to impediments to migration we first use census data to investigate migration patterns and determinants we then examine the role of migration as an influence on income ratios between pairs of provinces the former analysis robustly confirms economic motives for migration but also suggests the existence of poverty related labor immobility at the provincial level examination of income ratios between pairs of provinces reveals that the impact of migration on inequality can be either negative or positive a robust inequality reducing impact of migration is found for migration flows into provinces where most of vietnam s trade oriented industrial investments are located

implications of higher global food prices for poverty in low income countries in many poor countries the recent increases in prices of staple foods raise the real incomes of those selling food many of whom are relatively poor while hurting net food consumers many of whom are also relatively poor the impacts on poverty will certainly be very diverse but the average impact on poverty depends upon the balance between these two effects and can only be determined by looking at real world data results using household data for ten observations on nine low income countries show that the short run impacts of higher staple food prices on poverty differ considerably by commodity and by country but that poverty increases are much more frequent and larger than poverty reductions the recent large increases in food prices appear likely to raise overall poverty in low income countries substantially

a simpler mechanism that stops agents from cheating abstract this note considers a principal multi agent model of a firm subject to adverse selection with just the usual optimal incentive constrained contracts being offered there exist multiple bayes nash equilibria in the agents subgame moreover from the agents perspective there exists an equilibrium that pareto dominates the equilibrium desired by the principal by exploiting the structure of the model this note develops a new approach for eliminating unwanted equilibria while retaining the desired equilibrium the approach when compared to existing approaches employs a simpler mechanism one with a smaller message space and makes weaker assumptions about the agents behavior journal of economic literature classification numbers c72 d82

implications of high food prices for poverty in pakistan the study estimates the impacts of rising world food prices on poverty in rural and urban areas of pakistan household income and expenditure data for 2004 2005 is used to estimate compensated and uncompensated price and expenditure elasticities using the linear approximation of the almost ideal demand system taking the unexpected component of higher domestic food prices in 2007 2008 own and cross price compensated elasticities are used to derive the changes in the quantity consumed food expenditure and impacts on poverty assuming the food crisis happened in 2004 2005 the results indicate that poverty increased by 34 8 severely affecting the urban areas where poverty increased by 44 6 as compared to 32 5 in rural areas the estimates show that 2 3 million people are unable to reach even one half of poverty line expenditures while another 13 7 million are just below and 23 9 million are just above the poverty line in the short run it is important to ensure food availability to these people in the long run the policy environment of subsidizing urban food consumers by keeping wheat prices lower than the international price needs to be reconsidered to provide the right incentives to increase food availability

taxation regulation and addiction a demand function for cigarettes based on time series evidence this work analyzes the effects of prices taxes income and anti smoking regulations on the consumption of cigarettes in california a 25 cent per pack state tax increase in 1989 enhances the usefulness of this exercise analysis is based on monthly time series data for 1980 through 1990 results show a price elasticity of demand for cigarettes in the short run of 0 3 to 0 5 at mean data values and 0 5 to 0 6 in the long run we find at least some support for two further hypotheses that antismoking regulations reduce cigarette consumption and that consumers behave consistently with the model of rational addiction

an empirical analysis of milk addiction we show the estimable rational addiction model tends to yield spurious evidence in favor of the rational addiction hypothesis when aggregate data are used direct application of the canonical model yields results seemingly indicative that non addictive commodities such as milk eggs and oranges are rationally addictive monte carlo simulation demonstrates that such results are likely to obtain whenever the commodity under scrutiny exhibits high serial correlation or when even a small amount of the variation in prices is endogenous or when overidentified instrumental variables estimators are used or when commonly imposed restrictions are employed we conclude that time series data will often be insufficient to differentiate rational addiction from serial correlation in the consumption series