prices policing and policy the dynamics of crime booms and busts in many historical episodes criminal activity displays booms and busts one clear example is the case of metal crime in the uk and elsewhere where in the face of big increases in value driven by world commodity prices thefts rose very sharply in the 2000s after which they fell this paper studies the respective roles of prices policing and policy in shaping this crime boom and bust separate study of each reveals metal crime being driven up via sizeable and significant metal crime price elasticities and driven down by changes in policing and policy a regression based decomposition analysis confirms that all three of the hypothesised factors considered in the paper prices policing and policy were empirically important in the different stages of metal theft s boom and bust

a multivariate sample selection model estimating cigarette and alcohol demands with zero observations heckman s sample selection model is generalized to the multivariate case and used to estimate demands for cigarettes beer and wine by individuals in the united states the specification allows correlations between the error terms of multiple selection and level equations and nests the popular bivariate sample selection model and two part model empirical results suggest that the proposed model performs better than the restricted specifications differentiated effects of variables on probabilities and levels of consumption also suggest rejection of the tobit system gender differences are present and demographic variables are more important than income in determining consumption of cigarettes beer and wine

time and punishment an intertemporal model of crime if an increase in the rate at which a criminal commits crimes lowers the expected time until detection the income from crime net of expected fines must be discounted at a rate that varies with the crime rate this paper models the criminal s choice of the optimal crime rate under such conditions it is shown that irrespective of the criminal s attitude toward risk an increase in the probability of detection is more likely to deter crime than a comparable increase in penalties other implications of the model for the optimal enforcement of laws are also explored

separability functional form and regulatory policy in models of interfuel substitution abstract counter intuitive results such as positive own price elasticities have been found in some studies of interfuel substitution this paper examines three possible reasons for this problem first including energy materials in petroleum and coal aggregates is found to contribute to incorrect signs second the mathematical properties of the translog function contribute to concavity violations in contrast the linear logit model of cost shares is found to provide more sensible estimates of own price elasticities across alternative model specifications finally natural gas curtailment policies and environmental regulations are found to be significant factors influencing us industrial fuel demand although omission of these factors does not directly contribute to curvature violations

determinants of violent and property crimes in england and wales a panel data analysis we examine various determinants of property and violent crimes by using police force area level pfa data on england and wales over the period of 1992 2008 our list of potential determinants includes two law enforcement variables namely crime specific detection rate and prison population and various socio economic variables such as unemployment rate real earnings proportion of young people and the gini coefficient by adopting a fixed effect dynamic gmm estimation methodology we attempt to address the potential bias that arises from the presence of time invariant unobserved characteristics of a pfa and the endogeneity of several regressors there is a significant positive effect of own lagged crime rate the own lagged effect is stronger for property crime on an average than violent crime we find that on an average higher detection rate and prison population leads to lower property and violent crimes this is robust to various specifications however socio economic variables with the exception

male unemployment and crime in england and wales this paper employs county level data to investigate the relationship between crime and male adult and youth unemployment in britain our results indicate that there is a systematic positive relationship between most crime and male unemployment regardless of age

personal indebtedness community characteristics and theft crimes becker 1968 and stigler 1970 provide the germinal works for an economic analysis of crime and their approach has been utilised to consider the response of crime rates to a range of economic criminal and socioeconomic factors until recently however this did not extend to a consideration of the role of personal indebtedness in explaining the observed pattern of crime this paper uses the becker 1968 and stigler 1970 framework and extends to a fuller consideration of the relationship between economic hardship and theft crimes in an urban setting the increase in personal debt in the past decade has been significant which combined with the recent global recession has led to a spike in personal insolvencies in the context of the recent recession it is important to understand how increases in personal indebtedness may spillover into increases in social problems like crime this paper uses data available at the neighbourhood level for london uk on county court judgments ccj s granted against residents in that neighbourhood this is our measure of personal indebtedness and examines the relationship between a range of community characteristics economic socio economic etc including the number of ccj s granted against residents and the observed pattern of theft crimes for three successive years using spatial econometric methods our results confirm that theft crimes in london follow a spatial process that personal indebtedness is positively associated with theft crimes in london and that the covariates we have chosen are important in explaining the spatial variation in theft crimes we identify a number of interesting results for instance that there is variation in the impact of covariates across crime types and that the covariates which are important in explaining the pattern of each crime type are largely stable across the three periods considered in this analysis

measuring the value of induced technological change in this paper we analyze the value of induced technological change itc for cutting the costs of reaching climate stabilization targets using techniques from the tax burden literature first itc is valuable as it increases the elasticity of emissions with respect to carbon prices and thereby it decreases the burden associated with an enforced emission reduction second under itc emission abatement may generate a positive learning dividend when the social value of the induced change in learning exceeds its costs we discuss under which assumptions we expect itc to turn out a valuable feature or not we also carry out a numerical analysis with two models one focusing on energy savings the other focusing on energy transition the models suggest that both the decreased carbon tax burden and the learning dividend gain can be substantial compared to the costs of abatement without itc

burglary and income inequality abstract in a model where risk neutral agents have differing legal incomes which may be supplemented by burglary we study the effects of income distribution on the level of burglary assuming that a detected burglar is incarcerated for a fixed term and assuming that burglars choose target houses using the signal of house quality we show how increases in income inequality may increase the level of crime in particular increases in relative differential inequality unambiguously increase burglary crime corollaries are that a more regressive income tax increases the level of crime and that richer neighborhoods may have lower crime rates

industrial sector fuel price elasticities following the first and second major oil price shocks abstract estimated fuel price elasticities are consistent with reactions following the second major oil shock having been significantly different from reactions to its predecessor in turn elasticities for both sub periods are not well represented by those estimated for 1960 1982 as a whole

youth unemployment and crime in the english regions and wales this paper investigates the relationship between unemployment and crime in england and wales taking account of both age and gender in the unemployment measures the study is for 1985 95 and is disaggregated to the regional level we allow for different types of crime and the deterrence effects of detection and punishment we also consider the relationship between ethnicity and crime in the light of the contentious public debate on this issue our results indicate that there is a systematic positive relationship between burglary rates and male unemployment regardless of age however we find that while youth unemployment is consistently and positively related to criminal damage and robbery rates there is no systematic evidence of a relationship between adult male unemployment and these specific crimes instead our evidence supports a positive link between adult unemployment and theft we find no compelling evidence of a link between ethnicity and crime

interfuel competition in the industrial sector of seven oecd countries abstract the purpose of this article is to present an analysis of interfuel substitution in the industrial sector of seven major oecd countries the united states canada japan germany france the united kingdom and italy over the 1960 1993 period translog models are used to provide estimates of price elasticities from annual data for each country results outline the weakness of price elasticities and changes in behaviour over the last 35 years and show evidence of asymmetric effects since the collapse of oil prices in 1986 substitution has stopped industrial energy demand and oil consumption have stagnated interfuel substitution is widely induced by events other than relative price changes energy policy political and institutional constraints changes in economic activity characteristics within individual country sectors

teaching tools what s wrong here what s wrong here i introduction in the interest of enhancing the economic way of thinking many professors encourage students to read the wall street journal or other business periodicals a passive role while others following kelly 1983 use business periodicals in a more specific way in both instances the objective is to inspire students to correctly apply basic economic principles to real world problems in order to make economics relevant and interesting and to increase the retention level of a conventional one year economics course research by saunders 1980 pp 10 12 supports the importance of regular reading of business periodicals for achieving the goals the passive method of using business periodicals handing out wall street journal or business week sign up sheets and occasionally making periodic references to specific articles is time efficient for the busy professor but can be counterproductive unless the professor takes time to alert students to possible errors in economic reasoning that occur more frequently than is desirable in many business articles particularly articles applying supply and demand analysis most students will make the assumption that the economic analysis reported in the press is correct in those instances where journalists or experts apply improper economic reasoning in their reporting the article may serve the undesired outcome of reinforcing similar errors in thinking by students reading the article this confusion is further compounded when in the same article errors are reported in one segment while other arguments correctly apply economic concepts the purpose of this article is to aid professors in using business periodicals in principles courses by presenting examples of three errors in applying supply and demand analysis that are frequently made both by students and authors of business articles incorrect use of supply and demand analysis as evidenced in journalistic reports has several implications that can have adverse affects on students of professors who passively use business periodicals in introductory economics courses first the student who has been careful to learn the proper terminology and logic will feel uncomfortable and begin to question their own understanding when reading from someone professional who has applied the concept incorrectly second the student who at the time of reading does not fully appreciate the principle but is attempting to apply it will unfortunately learn from the incorrect presentation and thus the article will have a negative effect on the original teaching objective finally if the error made by the author is one made frequently by students it will become harder for the student to correctly learn economic principles since the student s erroneous reasoning has been verified by the journalist or the expert while it would be impossible for a professor to monitor even the wall street journal for all cases of misreporting during a semester the professor can make the students more sophisticated readers and hopefully avoid some of the above problems by presenting examples of typical errors of reasoning students may encounter in their outside reading the professor can maintain a file of articles that have come to his her attention or use available supplements that contain examples of journalistic errors applying economic reason some brief examples of typical errors that we have recently used effectively in our classes follow ii examples the first typical error involves the failure to carefully distinguish between changes in quantity demanded quantity supplied and changes in demand supply principles of economics texts carefully distinguish between changes in quantity demanded and changes in demand the terminology when consistently applied allows a reader to easily determine whether a change in buyer behavior has resulted from a change in product price or from a change in a non price determinant of demand

teaching tools on journalists use of macroeconomic concepts teaching tools on journalists use of macroeconomic concepts five macroeconomic concepts are presented which are prominent in the business sections of newspapers but which are not given equivalent prominence in macroeconomic textbooks these are the discouraged worker phenomenon the use of inventories in forecasting the effect of changes in the money supply on the bond market and the effects of inflation and nominal interest rates in the foreign exchange market these concepts are presented via news clips illustrating the way they typically appear in the press instructors are urged to place extra emphasis on these concepts i introduction it has become common for economics textbooks and instructors to use newspaper clippings to illustrate the application of economic concepts to the real world in addition to several readings books of newspaper articles a modest journal literature has appeared on this topic kelley 1983 advocates having students make up their own economics newspaper by cutting and pasting from regular news sources wood 1985 discusses many facets of the connection between news coverage of economic events and economic education drawing on his experience as a former reporter grunin and lindauer 1986 describe a course in economic journalism boynton and deissenberg 1987 extract a macroeconomic model implicit in newspaper commentary and cochran and brown 1989 warn instructors to be alert to journalists errors for example this literature tries in a variety of ways to address a common complaint expressed cogently by fels 1970 41 we neither try nor succeed in training students to use economic principles to evaluate critically what they read in the popular press this paper extends this literature in a new direction one of the many good reasons for supplementing economic instruction with newspaper clippings is to ensure that students can interpret and evaluate newspaper commentary on economic issues it is therefore important that economic concepts prominent in news articles be given adequate stress by instructors and in a way which illustrates how these concepts are used in newspapers in this paper i note five applications of macroeconomic concepts which play prominent roles in the financial pages of newspapers primarily because of their practical implications for the business world but which are not given an equally prominent treatment by textbooks since so many of our students will find themselves in the business world after graduation and so many more will retain contact with macroeconomics solely through newspaper commentary these five concepts seem worthy of extra emphasis by instructors a second point i wish to stress is that it is not enough to provide this extra emphasis within the context of the traditional textbook development of these macroeconomic concepts the traditional presentation must be supplemented with concrete examples illustrating how they are used in newspaper commentary with particular reference to their practical implications it is not unusual for journalists to write in a cryptic metaphor laden style that can disguise the macroeconomic concept being exploited and unlike textbooks explanations are seldom offered for this reason i present these five concepts accompanied by one or two sentence newspaper clips 1 illustrating the way they typically appear in the press most of the macroeconomic concepts playing prominent roles in newspaper commentary such as the multiplier monetary policy and the phillips curve play equally prominent roles in macroeconomics textbooks the five macroeconomic concepts discussed below were singled out because their textbook treatments are not commensurate with their importance in news reports and do not stress the potential roles these concepts can play in the interpretation of business world events

unemployment and crime rates in the post world war ii united states a theoretical and empirical analysis using annual time series data for the united states 1946 1982 two hypotheses are tested 1 the level of the unemployment rate in any given year will have a negative partial contemporaneous effect on detrendedfluctuations increases or decreases in seven index crime rates homicide rape aggravated assault robbery burglary larceny theft and motor vehicle theft in that year 2 unemployment rate fluctuationsfrom one year to the next will have a positive partial effect on detrended crime rate fluctuations in the next year these hypotheses are developed from a theoretical model that identifies the former with a criminal opportunity effect and the latter with a criminal motivation effect of aggregate unemployment on crime for burglary robbery and larceny theft empirical support is found for the expected pattern of partial effects however the relative sizes of the effects are such that the total impacts of unemployment through both partial effects are negative in addition only the negative levels effect is exhibited for homicide and motor vehicle theft while rape and aggravated assault show no consistent association with either levels orfluctuations in the unemployment rate interpretations for these findings are discussed

unconventional energy taxation and interstate welfare an analysis of pennsylvania s severance tax policy abstract natural gas production from unconventional sources has increased over the past decade a significant portion of this increase has come from output in the marcellus region of pennsylvania this output has altered gas markets and repositioned pennsylvania as a major gas exporter it has also put pennsylvania at odds with other states as it is one of a few without a formal severance tax on extractive resources in this paper we combine results from a structural demand model with a two sector trade model to analyze the interstate welfare impacts of pennsylvania s current severance tax proposal our results demonstrate that most of the welfare losses from this proposed policy are likely to be shifted to residents in other states we also demonstrate how fluctuations in gas prices can substantially reduce tax revenue these findings have important implications for both pennsylvania and u s energy policy given the significant rise in energy production from new sources throughout the u s

a dynamic analysis of interfuel substitution for swedish heating plants abstract this paper estimates a dynamic model of interfuel substitution for swedish heating plants we use the cost share linear logit model developed by considine and mount considine t j mount t d 1984 the use of linear logit models for dynamic input demand systems review of economics and statistics 66 434 443 all estimated own price elasticities are negative and all cross price elasticities are positive the estimated dynamic adjustment rate parameter is small however increasing with the size of the plant and time indicating fast adjustments in the fuel mix when changing relative fuel prices the estimated model is used to illustrate the effects of two different policy changes

teaching tools a public goods experiment for the classroom teaching tools a public goods experiment for the classroom george stigler wrote in the american economic review twenty seven years ago that the typical student in an introductory college economics course would memorize a few facts diagrams and policy recommendations and ten years later be as untutored in economics as the day he entered the class 1963 657 and later in the journal of economic education stigler argued that economics belongs in everyone s education once we have learned how to teach it 1970 80 as we enter the nineties academic economists continue groping for methods and techniques that will improve the way in which principles courses are taught the proliferation of commercially available materials in the form of textbooks workbooks software telecourses e g economics usa and transparencies provides evidence of the increasing interest and expenditure aimed at improving the teaching of economics however there exists at least one very promising teaching technique that continues to see relatively limited action in the typical economics classroom while experimental economic methods have become quite familiar to academic economists as a legitimate and powerful research tool their usefulness for the economics classroom has not yet been generally recognized 1 in this article i describe a simple yet powerful public goods experiment for use in microeconomics or public finance courses since it is likely that many instructors in economics are reluctant to use experimental methods without sufficient preparation 2 enough detail on experiment administration and suggested post experiment discussion is provided to assist even the novice experimenter with getting started instructors interested in additional information on experimental economics or experiments for the classroom should consult the references listed in the concluding section i experiment description 3 a theoretical concept that introductory students often find hard to understand is the vertical summation of individual demand curves to obtain the market demand for a public good the typical student also fails to fully appreciate how a free rider can cause underinvestment in public goods the experiment outlined below provides a simple yet powerful technique to teach not only the vertical addition and the free rider problems but also an ideal way to construct a prisoner s dilemma game and discuss the resulting underinvestment in the public good students are placed into n teams where a team may be as few as one person each team is endowed with t tokens and must choose in each of the decision making rounds whether to invest these tokens in the private account or the group account the private account will pay the team 0 30 per token invested each round the group account will earn for the entire society 0 50 per token invested each round from the group account each team will then receive 0 50 g sub i n where g sub i equals the total number of tokens invested in the group account in round i by all n teams note that regardless of how many tokens any single team places into the group account all n teams receive the same payout from the group account teams must invest all t tokens in each round and tokens cannot carry over from one round to the next finally earnings from previous rounds are not allowed to be reinvested in the future ii example experiment assume a representative class of sixty students 4 assume the instructor divides the class into twenty teams n 20 of three students each each team is endowed with t 25 tokens per round the teams read the instructions overhead transparency while the instructor distributes to each team i the team record sheet and ii the team decision ballots one for each round 5 for each round once all the team ballots have been submitted the instructor sums the tokens invested in the group account and reports this number and the dollar payout per team to the entire class

inequality reducing and inequality preserving transformations of incomes symmetric and individualistic transformations abstract this paper analyzes the redistributive effect of transformations of incomes when the same transformation is applied to all incomes following marshall and olkin lnequalities a theory of majorization and its applications academic press new york 1979 we consider two competing families of nested inequality criteria all of which are consistent with the lorenz ordering looking at the transformations that reduce the inequality of incomes we show that within each family all the criteria generate exactly the same class of transformations we next identify those transformations that preserve or convert a given inequality ranking into a finer ranking we finally find necessary and sufficient conditions to be imposed on a pair of transformations for the inequality ranking of distributions to be preserved journal of economic literature classification number d31 d63 h24

modeling energy demand some emerging issues abstract the proliferation of papers on energy demand modeling has offered different dimensions both in terms of methodology and estimation while this development has strengthened our understanding of the subject it may render the identification of gaps in the literature arduous for future research thus this study sets out to document some emerging issues that seem to have engendered new directions on energy demand modeling ranging from asymmetric price responses time varying demand parameters triangulation analyses to seasonal and climate change effects it is hoped that access to this review complemented with the previous ones will facilitate the comprehension of the extant literature as well as areas of future research in energy demand modeling

major oecd country industrial sector interfuel substitution estimates 1960 1979 abstract a range of static and dynamic translog based expenditure shares models are estimated for non energy producing industrial sectors of the major seven countries of the oecd area sectoral energy volume and fuel efficiency bias variables are shown to be significant over and above individual prices in explaining individual fuel expenditure shares statistically significant own price and cross price elasticities of demand are presented for individual countries with some magnitudes varying considerably across alternative model specifications

fossil fuel producing economies have greater potential for industrial interfuel substitution abstract this study analyzes industrial interfuel substitution in an international context using a large unbalanced panel dataset of 63 countries we find that compared to other countries fossil fuel producing economies have higher short term interfuel substitution elasticities this difference increases further in the long run as fossil fuel producing countries have a considerably longer adjustment of their fuel using capital stock these results imply lower economic cost for policies aimed at climate abatement and more efficient utilization of energy resources in energy intensive economies

interfuel substitution a meta analysis interfuel substitutability has been of longstanding interest to the energy economics and policy community however no quantitative meta analysis has yet been carried out of this literature this paper fills this gap by analyzing a broad sample of studies of interfuel substitution in the industrial sector manufacturing industry or subindustries or macro economy of a variety of developed and developing economies publication bias is controlled for by including the primary study sample size in the meta regression results for the shadow elasticities of substitution between coal oil gas and electricity for forty six primary studies show that at the level of the industrial sector there are easy substitution possibilities between all the fuel pairs with the exception of gas electricity and coal electricity substitution possibilities seem more constrained at the macro level and less constrained in sub industries estimates also vary across countries publication bias does not seem to be present but model and data specification issues very significantly affect the estimates derived by each individual study estimates from cross section regressions are generally largest fixed effects panel estimates intermediate in magnitude and time series estimates are mostly much smaller econometric research suggests that the fixed effects estimates are likely the best among the existing studies though biased downwards

adult labour market implications of antisocial behaviour in childhood and adolescence findings from a uk longitudinal study while antisocial behaviour in younger age groups is largely viewed as a public externality issue there are also reasons for expecting less favourable life course outcomes for those individuals who follow antisocial developmental pathways data from a uk longitudinal study of delinquent development in a cohort of working class boys are used to model the adult labour market implications of different antisocial developmental pathways to age 32 a series of probit estimations suggests that children identified as troublesome by peers and teachers at an early age and who subsequently engaged in delinquent behaviour throughout their adolescence had a significantly higher probability of experiencing long periods of time out of the workforce prior to age 32 and lengthy periods of unemployment and or low paid work at both age 18 and at age 32 a heckman selectivity model estimated on weekly earnings at age 32 does not provide evidence that antisocial development in children and adolescents is associated with a l

the design of direct taxation and family benefits abstract the subject of this paper is the design of the personal income tax and social security benefits that vary with the size of the family it is concerned with the analytical problems of policy design that arise from constraints on the instruments which may be used from differences in social judgements about the desirability of redistribution and from differences of view about the disincentive effects of taxation the paper considers these issues in the context of the french tax benefit system and the implications of the french system being harmonised towards certain features of the british system

electric utilities fuel use and responsiveness to fuel prices this research tests the impact of changes in fuel price to explain fuel use by electric utilities we employ a three stage least squares model that explains changes in fuel use as a function of changes in three fuel prices this model is repeated across sub samples of data aggregated at the plant level and operating holding company level we expect that plants and holding companies reduce fuel use when fuel prices rise several fuel substitution effects within and across plants and holding companies are demonstrated as well as several frictions at the plant level higher prices of natural gas lead to less natural gas consumption less coal consumption and more fuel oil consumption at the operating holding company level results demonstrate the inelasticity of coal use and the increases of natural gas in response to higher coal prices subsamples demonstrate heterogeneity of results across different plants results emphasize that technological market and regulatory frictions may hinder the performance of energy policies

is there a consensus among economists in the 1990 s in a 1976 survey kearl et al 1979 hereafter the 1976 survey concluded that the then widespread perception that there was little agreement among professional economists on matters of theory or policy was simply wrong however the most casual empiricism namely the continuing popularity of jokes about disagreements among economists suggests the perception of noneconomists has not changed much since the 1970 s what is the present state of consensus among economists this question is of interest because more than a decade has elapsed since the 1976 survey and during this time many issues confronting economists and the composition of the profession have changed 1 benjamin m friedman and lawrence h summers 1991 p ix for example have asserted that economic thinking in many subfields of the discipline now differs markedly from what it was in 1970 consensus among european economists has been examined by bruno s frey et al 1984 martin ricketts and edward shoesmith 1990 1992 focus exclusively on british economic opinion this paper provides the first general analysis of opinions of u s economists in more than a decade i the survey and questionnaire

the use of linear logit models for dynamic input demand systems this paper demonstrates that a linear logit model with appropriate constraints can be used to specify a system of cost share equations that satisfy neoclassical economic conditions unlike many other flexible functional forms the logistic function is particularly well suited for incorporating dynamic adjustment mechanisms the empirical results suggest that the use of static models overstates short run own price elasticities and understates the corresponding long run price effects

modelling oecd industrial energy demand asymmetric price responses and energy saving technical change abstract the industrial sector embodies a multifaceted production process consequently modelling the derived demand for energy is a complex issue made all the more difficult by the need to capture the effect of technical progress of the capital stock this paper is an exercise in econometric modelling of industrial energy demand using panel data for 15 oecd countries over the period 1962 2003 exploring the issue of energy saving technical change and asymmetric price responses although difficult to determine precisely it is tentatively concluded that the preferred specification for oecd industrial energy demand incorporates asymmetric price responses but not exogenous energy saving technical change

modelling energy demand of developing countries are the specific features adequately captured abstract this paper critically reviews existing energy demand forecasting methodologies highlighting the methodological diversities and developments over the past four decades in order to investigate whether the existing energy demand models are appropriate for capturing the specific features of developing countries the study finds that two types of approaches econometric and end use accounting are commonly used in the existing energy demand models although energy demand models have greatly evolved since the early seventies key issues such as the poor rich and urban rural divides traditional energy resources and differentiation between commercial and non commercial energy commodities are often poorly reflected in these models while the end use energy accounting models with detailed sectoral representations produce more realistic projections as compared to the econometric models they still suffer from huge data deficiencies especially in developing countries development and maintenance of more detailed energy databases further development of models to better reflect developing country context and institutionalizing the modelling capacity in developing countries are the key requirements for energy demand modelling to deliver richer and more reliable input to policy formulation in developing countries

examining the link between crime and unemployment a time series analysis for canada we use national and regional canadian data to analyse the relationship between economic activity as reflected by the unemployment rate and crime rates given potential aggregation bias we disaggregate the crime data and look at the relationship between six different types of crimes rates and unemployment rate we also disaggregate the data by region we employ an error correction model in our analysis to test for short run and long run dynamics we find no evidence of long run relationship between crime and unemployment when we look at both disaggregation by type of crime and disaggregation by region lack of evidence of a long run relationship indicates we have no evidence of the motivation hypothesis for selected types of property crimes we find some evidence of a significant negative short run relationship between crime and unemployment lending support to the opportunity hypothesis inclusion of control variables in the panel analysis does not alter the findings qualitatively or quantitatively

industrial sector interfuel substitution following the first major oil shock abstract strict conditions for a two stage translog expenditure shares model are violated a single stage homothetic symmetry equality model is rejected in favour of a non homothetic equality model international own price elasticities derived from the latter for oil gas coal and electricity are 0 26 0 81 0 97 and 0 02 little changed from 0 24 0 71 1 35 and 0 09 for the former

liberalisation consumption heterogeneity and the dynamics of energy prices in this study the methodology var and the cointegration analysis are used to examine the dynamic interaction among the energy prices of the competitor energy sources in a liberalised market data from the uk market were applied and models for the residential and industrial sectors were developed our results indicate the existence of long run relationships between the energy prices before and after the liberalisation implying the possibility of substitution among the different forms of energy however the results appear to be also largely influenced by external variables not included in the models that may be reducing the importance of the energy prices over their own evolution and offsetting the basic substitution relationships the general results of the impulse response functions both for the residential and industrial sectors present low statistical significance which seems to be due to the still slow rate of adjustment of the energy market to price changes along with the immaturity of the liberalisation process taking into consideration the results some routes for future research are pointed out namely the need to include in the analysis variables which would proxy the general state of the economy

international evidence on aggregate short run and long run interfuel substitution in this paper we build on recent work by serletis et al 2010 in press and report short and long run estimates of aggregate interfuel substitution for a number of oecd and non oecd countries in doing so we use recent pooled intercountry data since 1980 and state of the art advances in microeconometrics including duality theory and flexible functional forms also motivated by the widespread practice in the empirical energy demand literature of ignoring theoretical regularity we estimate our model subject to global curvature but not monotonicity using methods developed by diewert and wales 1987 we provide inference and also a policy perspective using parameter estimates that are consistent with the theoretical regularity conditions of neoclassical microeconomic theory

domestic burglaries and the real price of audio visual goods some time series evidence for britain this paper explores the relationship between the real price of audio visual goods and domestic burglaries using british data our findings suggest that the falling real price of these consumer goods has contributed to a reduction in domestic burglary activity

a pooled dynamic analysis of interfuel substitution in industrial energy demand by the g 7 countries a dynamic version of considine s 1990 linear logit model is used to obtain theoretically consistent estimates of long run price elasticities from pooled intercountry data on industrial energy consumption this model also provides a rare direct estimate of the important rate of dynamic adjustment revealing a median lag of ten years the long run demands for oil and coal are the most elastic and the strongest channels for interfuel substitution are between oil and natural gas with no significant evidence of complementarity between fuels

firing the furnace an econometric analysis of utilities fuel choice abstract this paper attempts to estimate how the fuel mix of german electricity producers does react to fuel price changes the empirical analysis is based on panel data 1968 1998 of major utilities two different aspects of fuel choice are distinguished at the one hand the construction of usually fuel specific capacities for electric power generation i e investment decisions that determine the fuel mix in the long run at the other fuel use conditional on existing generation capacities i e short run inter fuel substitution according to the results from panel unit root tests both the econometric models which describe these two aspects are specified in changes rather than levels the partly discrete nature of investment decisions is taken into account by constructing a discrete model of capacity adjustment our estimation results suggest that the fuel mix of electric utilities is price inelastic either if long term investment or short term inter fuel substitution is considered finally the empirical results are used to predict the potential impacts of co 2 emissions trading on fuel choice in the german electric power industry

criminals response to changing crime lucre how do criminals respond to changes in the benefit from committing a successful crime this question is relevant for understanding the effectiveness of crime fighting policies that reduce demand for illegal goods disrupt black markets and otherwise eliminate cheaper avenues to illicit gain however the literature has not sufficiently addressed this question partly because finding a reliable measure of crime lucre is difficult using proprietary data on cargo theft i match historical prices of various goods with their thefts and estimate the price elasticity of theft to be 1 225 over a cumulative 7 month horizon jel k42

dynamic interfeed substitution implications for incorporating ethanol byproducts into feedlot rations abstractthis study examines interfeed substitution with a focus on the relationship between distiller s dried grain with solubles ddgs and traditional feed grains the dynamic linear logit model is used for the empirical analysis of interfeed substitution the estimation results reveal that an increase in livestock and poultry outputs reduces the relative shares of corn and soybean meal to ddgs the estimated adjustment rate indicates that the demand for feed grains is responsive in the short run with about 37 of the long run response this study also finds that the demand for corn and soybean meal remains inelastic even in the long run showing the possibilities that livestock and poultry producers face high feed costs in response to an increase in the prices of corn and soybean meal the pressures on feed costs can be alleviated by the substitutable relationship between ddgs and corn but the substitution of ddgs for corn has a potential to provide livestock and poultry with different nutritional con

personal indebtedness spatial effects and crime there is a long and detailed history of attempts to understand what causes crime one of the most prominent strands of this literature has sought to better understand the relationship between economic conditions and crime an economic argument is that in an attempt to maintain consumption in the face of unemployment people may resort to sources of illicit income in a similar manner we might expect ex ante that increases in the level of personal indebtedness would be likely to provide similar incentives to engage in criminality in this paper we seek to understand the spatial pattern of property and theft crimes using a range of socioeconomic variables including data on the level of personal indebtedness

crime during the business cycle urban rural differences abstractdespite the abundant literature on how crime evolves over the business cycle no consensus has arisen whether crime increases or decreases during recessions the literature provides both po

oil shocks and the dynamics of substitution adjustments of industrial fuels in the us this paper investigates substitution among such alternate fuels as coal natural gas and electricity during the actual oil price increases of 1970s these substitution adjustments are assumed to be dynamic and modelled by a partial adjustment structure this dynamic structure is incorporated into a translog cost technology short and long run price elasticities are estimated by identifying inter and intra industry variations the models are estimated with a sample of 88 pooled observations including distillate and residual oils purchased by eleven 2 digit manufacturing groups 1974 81 models are estimates are strictly negative these own price elasticities range from long to short run 2 93 to 2 55 for distillate oil 0 698 to 1 53 for residual oil 0 533 to 0 011 for coal 0 235 to 0 213 for natural gas to 0 888 to 0 845 for electricity estimastes of both short run and long run cross price elasticities suggest that coal and electric energy are the prominent substitutes for fuel oils w

crime and economic incentives we explore the role that economic incentives particularly changes in wages at the bottom end of the wage distribution play in determining crime rates we use data on the police force areas of england and wales between 1975 and 1996 and find relative falls in the wages of low wage workers lead to increases in crime we carry out a number of experiments with different wage measures including a wage measure that accounts for the effects of changes in the composition of employment these reinforce the picture of a strong association between the low wage labor market and crime the result that incentives play a central role is reinforced further by the strong impact on crime of deterrence measures and of a measure of the returns to crime

the link between crime risk and property prices in england and wales evidence from street level data this paper uses street level data on property sales and crime rates for england and wales to investigate compensating differentials for crime risk my identification strategy relies on the use of non parametric regional time trends on various levels of spatial aggregation as well as various fixed effects for streets and wider areas to control for unobserved amenities and regional economic conditions the data comes from transaction data collected by the land registry and recently published crime maps for the whole of the uk my estimates which are robust to a range of sensible specification changes suggest that each case of anti social behaviour per ten population in the same street leads to an approximately 0 6 0 8 drop in property prices while a corresponding increase in violent crime decreases prices by roughly 0 6 1 6 and a corresponding increase in non violent crime by about 0 2 0 4 the majority of estimates are at the upper end of these intervals estimates for robbery burglary and vehicle c

the changing returns to crime do criminals respond to prices to what extent does crime follow the pattern of potential gains to illegal activity this article presents evidence on how criminals respond to this key incentive by reporting crime price elasticities estimated from a comprehensive crime dataset containing detailed information on stolen items for london between 2002 and 2012 evidence of significant positive crime price elasticities are shown for a panel of 44 consumer goods and for commodity related goods jewellery fuel and metal crimes the reported evidence indicates that potential gains are a major empirical driver of criminal activity and a crucial part of the economic model of crime the changing structure of goods prices helps to explain over 10 15 of the observed fall in property crime across all goods categories and the majority of the sharp increases in the commodity related goods observed between 2002 and 2012

new evidence from the misery index in the crime function abstract we propose a parsimony model which is clear from multicollinearity and specification problems in the standard crime function this study examines the relationship between the misery index and the crime rate in the unites states from 1960 to 2005

the urban rural divide regional disaggregation and the convergence of crime potential regional variation in crime rates has been recognized as an issue of clear importance given its implications for the development and evaluation of theories of criminal activity determining the appropriate level of disaggregation at which to undertake empirical analyses of crime and whether crime fighting policies should be constructed at a national or local level consequently a literature has evolved examining the similarities in us regional crime rates and whether a national trend exists or is emerging the present article extends the recent research into the emergence of a national trend by considering convergence in alternative classifications of crime using a data set subject to a higher degree of disaggregation than considered hitherto the results obtained overturn previous findings obtained using more highly aggregated data indicating the detection of convergence to be dependent upon the level of disaggregation considered in addition the extent of convergence detected is shown to va

a market clearing classroom experiment this paper describes a classroom experiment demonstrating the price mechanism and the clearing of markets in an endowment economy participants receive random endowments of two goods they may trade in order to maximize a given utility function a market clearing price is reached when no mutually beneficial trades are possible the outcome is truly endogenous with no reservation prices or willingness to trade imposed on the participants a problem set allows the participants to study the equilibrium outcome analytically the experiment can be used in intermediate micro and macroeconomic courses

teaching tools teaching methods in undergraduate economics i introduction in 1970 nobel laureate george stigler argued that economics belongs in everyone s education once we have learned how to teach it but because the logic of economics is not easy to learn or teach he concluded that economics is not yet ready to be made a part of the basic curriculum of all educated men p 80 we now have new models for teaching economics in fact as in other areas of economics we have competing models with new approaches being offered to supplement extensively if not replace entirely the lecture pedagogy used nearly exclusively by economists at the time stigler s comments were published yet in major commission and committee reports and daily conversations held in faculty lounges around the world alternatives to the lecture approach in which the teacher often serves as a preacher and students as passive receptacles into which great thoughts and wisdom are poured still appear to be either unknown or tacitly dismissed as unworkable in this journal for example mccloskey 1992 tells of an exchange between george stigler and milton friedman friedman argued that while individuals pursue their self interest they are often ignorant and require education to see that something they thought was in their personal or national interest was not e g tariffs and quotas stigler called friedman a preacher he argued that people find their own self interest with or without education and that no amount of preaching or lecturing about economics would change that self interest in the report of the commission on graduate education in economics by krueger et al 1991 considerable attention was given to bringing real world issues into the classroom but the commission s assumed instructional mode was still the lecture it is our impression that most ph d programs devote little or no attention to teaching or encouraging the development of expository skills we suspect the lack of emphasis on communication in most ph d programs reflects partly the scarcity of teaching time partly instructors lack of confidence in their ability to teach communications skills and partly a judgment that the appropriate style of professional communication is something students can figure out for themselves by watching their teachers p 1049 the report of the committee on college faculty by kasper et al 1991 representing the nation s premiere liberal arts colleges emphasized the need for breadth in content coverage in economists graduate training but did not even mention the need for breadth in instructional methods or training in those areas despite these intentional or unintentional slights in literature from the past twenty five years we found that many economists have spent a great deal of time developing and applying new teaching methods to actively engage students in the learning process in what follows we summarize those alternative approaches to make it easier for others to consider and access these articles on innovative instructional methods in economics ii classroom games simulations and laboratories although edward chamberlin and others working in the area of imperfect competition were developing artificial markets in the classroom as early as the 1940s joseph and saunders 1970 were perhaps the first economists to publish an extensive account on how to use such games to teach basic economic concepts the approach soon proved to be quite popular at least with the developers of these activities the national council on economic education then known as the joint council on economic education published the first edition of its guide to games and simulations for teaching economics in 1971 written by lewis and wentworth with references to some ninety different activities and publications in recent years commercially published games and simulations in economics have continued to appear often featuring mainframe econometric models or microcomputer programs written specifically as a classroom simulation

factor substitution and energy productivity fluctuation in china a parametric decomposition analysis abstract technical research on energy productivity can support government officials as they evaluate practical energy policies for the future this study proposed a parametric method to decompose china s energy productivity rate of change into six factors based on a theoretical stochastic frontier analysis the method was applied to conduct an empirical study using inter provincial panel data in china from 1995 to 2012 the results highlighted three key points first the general rate of change in energy productivity was mainly influenced by a steady positive rate of change in technical progress combined with a steady negative rate of change in technical efficiency the core factors causing fluctuations in energy productivity included a positive rate of change in the substitution of capital and energy and a negative rate of change in the substitution of labor and energy second from a geographic perspective provinces with a high rate of change in technical progress experienced a weaker deterioration in technical efficiency however the rate of change in technical efficiency tends to decline as the rate of change in technical progress increases third there is a similar changing trend between the substitution of capital and energy and the substitution of labor and energy

the market for street crime an economic analysis of victim offender interaction abstract this paper views the economic explanation of crime rates from a new perspective by explicitly deriving an economic model of the behavior of potential victims and considering the interaction of the behavior of potential victims with the behavior of offenders crime is produced through offenders supplying time in search of victims and victims demanding to expose themselves to the environment a model is set up in which the crime rate the probability of being a victim per unit of exposure time and the probability of finding a victim per unit of offenders search time are simultaneously determined the model leads us to distinguish the real crime rate the probability of being a victim per unit of exposure time from the nominal crime rate the number of crimes per capita the nominal crime rate can be inversely related to the real crime rate

a general equilibrium model of crime commission and prevention abstract the model developed in this paper features a general equilibrium specification of the relationships among criminals victims of crime and a law enforcement agency these relationships are employed to endogenously derive an explicit intuitively appealing technology of crime commission and prevention the solution to the present model is therefore obtained with a set of more elementary assumptions than the previous literature where arbitrary curvature assumptions are invoked

the optimal use of fines and imprisonment abstract this paper examines the use of fines and imprisonment to deter individuals from engaging in harmful activities these sanctions are analyzed separately as well as together first for identical risk neutral individuals and then for two groups of risk neutral individuals who differ by wealth when fines are used alone and individuals are identical the optimal fine and probability of apprehension are such that there is some underdeterrence if individuals differ by wealth then the optimal fine for the high wealth group exceeds the fine for the low wealth group when imprisonment is used alone and individuals are identical the optimal imprisonment term and probability may be such that there is either underdeterrence or overdeterrence if individuals differ by wealth the optimal imprisonment term for the high wealth group may be longer or shorter than the term for the low wealth group when fines and imprisonment are used together it is desirable to use the fine to its maximum feasible extent before possibly supplementing it with an imprisonment term the effects of risk aversion of these results are also discussed

crime and local inequality in south africa the authors examine the effects of local inequality on property and violent crime in south africa their findings are consistent with economic theories relating inequality to property crime and also with sociological theories that imply that inequality leads to crime in general burglary rates are 20 30 percent higher in police station jurisdictions that are the wealthiest among their neighbors suggesting that criminals travel to neighborhoods where the expected returns from burglary are highest the authors do not find evidence that inequality between racial groups fosters interpersonal conflict at the local level

how do banks adjust to changing input prices a dynamic analysis of u s commercial banks before and after the crisis abstract the 2000 2013 period was characterized by substantial regulatory monetary and technological change especially after the onset of the global financial crisis this study assesses the total impact of these policy shifts and technological changes on u s commercial banks short run and long run substitution elasticities an endogenous break test divides the sample into a pre crisis period and a post crisis period during the former period banks inputs tend to be inelastic substitutes after the onset of the crisis particularly the long run substitutability of most input factors decreases to even lower levels due to changes in both cost technology and economic conditions at the same time banks response to input price changes becomes more sluggish hence especially after the onset of the crisis banks have little flexibility regarding input factor usage and are thus sensitive to input price changes from a cost perspective