ecosystem services from eye opening metaphor to complexity blinder abstract what started as a humble metaphor to help us think about our relation to nature has become integral to how we are addressing the future of humanity and the course of biological evolution the metaphor of nature as a stock that provides a flow of services is insufficient for the difficulties we are in or the task ahead indeed combined with the mistaken presumption that we can analyze a global problem within a partial equilibrium economic framework and reach a new economy project by project without major institutional change the simplicity of the stock flow framework blinds us to the complexity of the human predicament the ecosystem services approach can be a part of a larger solution but its dominance in our characterization of our situation and the solution is blinding us to the ecological economic and political complexities of the challenges we actually face

from physical to human capital accumulation inequality and the process of development this paper develops a growth theory that captures the replacement of physical capital accumulation by human capital accumulation as a prime engine of growth along the process of development it argues that the positive impact of inequality on the growth process was reversed in this process in early stages of the industrial revolution when physical capital accumulation was the prime source of growth inequality stimulated development by channelling resources towards individuals with a higher propensity to save as human capital emerged as a growth engine equality alleviated adverse effects of credit constraints on human capital accumulation stimulating the growth process this research develops a growth theory that captures the endogenous replacement of physical capital accumulation by human capital accumulation as a prime engine of economic growth in the transition from the industrial revolution to modern growth the proposed theory offers a unified account for the effect of income inequality on the growth process during this transition it argues that the replacement of physical capital accumulation by human capital accumulation as a prime engine of economic growth changed the qualitative impact of inequality on the process of development in the early stages of the industrial revolution when physical capital accumulation was the prime source of economic growth inequality enhanced the process of development by channelling resources towards individuals whose marginal propensity to save is higher in the later stages of the transition to modern growth as human capital emerged as a prime engine of economic growth equality alleviated the adverse effect of credit constraints on human capital accumulation and stimulated the growth process the proposed theory unifies two fundamental approaches regarding the effect of income distribution on the process of development the classical approach and the credit market imperfection approach 1 the classical approach was originated by smith 1776 and was further interpreted and developed by keynes 1920 lewis 1954 kaldor 1957 and bourguignon 1981 according to this approach saving rates are an increasing function of wealth and inequality therefore channels resources towards individuals whose marginal propensity to save 1 the socio political economy approach provides an alternative mechanism equality diminishes the tendency for socio political instability or distortionary redistribution and hence it stimulates investment and economic growth see the comprehensive survey of benabou 1996b

education work and crime a human capital approach this article develops a model of crime in which human capital increases the opportunity cost of crime from foregone work and expected costs associated with incarceration older more intelligent and more educated adults should commit fewer street unskilled crimes white collar crimes decline less or increase with age and education predictions for age crime and education crime relationships receive broad empirical support in self report data from the national longitudinal survey of youth and arrest data from the uniform crime reports the effects of education training and wage subsidies as well as enforcement policies on criminal behavior are discussed

natural and environmental amenities a review of definitions measures and issues abstract this study investigates the notions of natural and environmental amenities in the social science literature the ways they are defined and measured and related issues we analyze 328 peer reviewed articles published over a 40 year period 1974 2013 we observe an exponential growth in publications with a small set of economics journals publishing most of the corpus despite this body of work there are still no widely acknowledged definitions of these notions research objectives have changed from an initial focus on recovering the implicit prices of natural environmental amenities to a more recent and growing interest in evaluating their impacts on regional development and quality of life regarding measurement most papers use unidimensional measures of natural attributes esp water bodies land cover use this survey leads to a discussion of prospects for future research

cheap children and the persistence of poverty this paper develops a theory of fertility that offers an explanation for the persistence of poverty within and across countries if educated individuals have a comparative advantage in raising educated children then parental fertility choice is shown to give rise to a poverty trap in which the poor choose high fertility rates with low investment in child quality moreover the impact of child quality choice on economic performance is amplified by the diluting effect of higher fertility on physical capital accumulation the theory proposes insights regarding the effects of inequality globalisation and life expectancy on economic growth and demographic transitions this paper develops a theory of fertility and child educational choice that offers an explanation for the persistence of poverty within and across countries the joint determination of the quality education and quantity of children in a household is studied under the key assumption that individuals productivity as teachers increases with their own human capital in contrast the minimum time cost associated with raising a child regardless of the child s quality the quantity cost is not affected by parental education as a result the price of child quantity relative to the price of child quality increases with individuals wages in particular for low wage individuals for whom the opportunity cost of time is low children of minimal quality are cheap this assumption therefore generates a comparative advantage for the poor in child quantity whereas high wage educated individuals have a comparative advantage in raising quality children consistent with the well known evidence poor households thus choose relatively high fertility rates with relatively low investment in their offspring s education and therefore their offspring are poor as well in contrast high income families choose low fertility rates with high investment in education and therefore high income persists in the dynasty evidence from the us provided by hanushek 1992 suggests that a trade off between quantity and quality of children does indeed exist hanushek argues that movements in family size could explain over half the variance in some test scores and that the elasticity of achievements with respect to the number of children in the family is 0 03 implying that the annual achievement growth of each child in a family will fall about 2 when a second child is added and about 0 5 when a sixth child is added 1

crime rates male youth unemployment and real income in australia evidence from granger causality tests this article applies granger causality tests to examine the relationship between seven different categories of property crime and violent crime against the person male youth unemployment and real male average weekly earnings in australia from 1964 to 2001 within a cointegration and vector error correction framework it is found that fraud homicide and motor vehicle theft are cointegrated with male youth unemployment and real male average weekly earnings however there is no evidence of a long run relationship between either break and enter robbery serious assault or stealing with male youth unemployment and real male average weekly earnings

us europe differences in technology driven growth quantifying the role of education abstract european economic growth has been weak compared to the us since the 1980s in previous work krueger and kumar 2003 nber working paper no 9410 we argued that the european focus on specialized vocational education might have been effective during the 1960s and 1970s but resulted in a growth gap relative to the us during the subsequent information age when new technologies emerged more rapidly in this paper we extend our framework to assess the quantitative importance of education policy when compared to labor market rigidity and product market regulation other policy differences more commonly suggested to be responsible for us europe differences a decomposition exercise using a calibrated version of our model assigns a major role to education policy in explaining us europe growth differences

the impact of incarceration on wage mobility and inequality a life course perspective on crime indicates that incarceration can disrupt key life transitions life course analysis ofoccupations finds that earnings mobility depends on stable employment in career jobs these two lines of research thus suggest that incarceration reduces ex inmates access to the steady jobs that usually produce earnings growth among young men consistent with this argument evidence for slow wage growth among ex inmates is provided by analysis of the national longitudinal survey of youth because incarceration is so prevalent one quarter of black non college males in the survey were interviewed between 1979 and 1998 while in prison or jail the effect of imprisonment on individual wages also increases aggregate race and ethnic wage inequality

earnings inequality and skill biased technological change with endogenous choice of education this article analyzes the impact of stochastic skill biased technological change on earnings inequality in a general equilibrium olg model wage dispersion is determined by the heterogeneity of skills by allowing for productivity differences due to education ability and age the model performs well in reproducing stylized facts on the time pattern of the u s wage distribution and human capital accumulation in particular it shows that slow adjustment of the supply of educated labor can itself explain the nonmonotonic time pattern of the college premium jel d31 j24 j31

public spending on education and the incentives for student achievement we build a model where homogeneous workers can accumulate human capital by investing in education schools combine public resources and individual effort to generate productive skills if skills are imperfectly compensated then in equilibrium students may under invest in effort we examine the effect on human capital accumulation of three basic education finance policies increased tuition subsidies may not be beneficial because they increase enrolment but they may lower the incentives for student achievement hence the skill level policies directed at enhancing the productivity of education or making degrees more informative are more successful at improving educational outcomes

evolution and growth this paper presents an evolutionary growth theory that captures the interplay between the evolution of mankind and economic growth since the emergence of the human species this uni ed theory encompasses the observed evolution of population technology and income per capita in the long transition from an epoch of malthusian stagnation to sustained economic growth 2001 elsevier science b v all rights reserved jel classixcation b22 e10 o11 o14 o33 o40 j10 j13

employment deterrence and crime in a dynamic model using maximum likelihood techniques and monthly panel data we solve and estimate an explicitly dynamic model of criminal behavior where current criminal activity impacts future labor market outcomes we show that the threat of future adverse effects in the labor market when arrested acts as a strong deterrent to crime moreover such forward looking behavior is estimated to be important hence policies that weaken this deterrence will be much less effective in fighting crime this suggests that prevention is more powerful than redemption since anticipated redemption allows criminals to look forward to negating the consequences of their crimes

inequality and city size between 1979 and 2007 a strong positive monotonic relationship between wage inequality and city size has developed this paper investigates the links between this emergent city size inequality premium and the contemporaneous nationwide increase in wage inequality after controlling for the skill composition of the workforce across cities of different sizes we show that at least 23 percent of the overall increase in the variance of log hourly wages in the united states from 1979 to 2007 is explained by the more rapid growth in the variance of log wages in larger locations relative to smaller locations this influence occurred throughout the wage distribution and was most prevalent during the 1990s more rapid growth in within skill group inequality in larger cities has been by far the most important force driving these city size specific patterns in the data differences in the industrial composition of cities of different sizes explain up to one third of this city size effect these results suggest an important role for agglomeration economies in generating changes in the wage structure during the study period

crime punishment and prejudice abstract we examine the link between the penalties used to punish convicted criminals and judicial prejudice against defendants in our model agents choose to commit crimes if their privately observed utility from doing so is high enough a crime generates noisy evidence and defendants are convicted when the realized amount of evidence is sufficiently strong to establish the probability of guilt beyond a fixed threshold we show that if convicted offenders are incarcerated poorer individuals face a strong prior prejudice in trials and are therefore convicted with less evidence than richer individuals at the same time they commit crimes more frequently penalties such as monetary fines can eliminate this bias but may also reverse it we fully characterize the penalty schedule that guarantees an unbiased equilbrium we extend the model such that agents also differ in characteristics such as race or gender we show biased outcomes targeted at subgroups of the population may still exist even if all members of the population are ex ante alike in their economic characteristics

migration policy african population growth and global inequality according to recent un projections more than 50 per cent of the growth in world population over the next half century will be due to population growth in africa given this any policy that influences african demography will have a significant impact on the world distribution of income in this study we discuss the potential for migration policies to affect fertility and education decisions and hence population growth in africa we present the results from different scenarios for more or less restrictive selective migration policies and derive their implications for the evolution of world inequality

intelligence social mobility and growth this study develops a model where the allocation of human resources intergenerational social mobility and technological growth are jointly determined high growth endogenously increases the equilibrium return to innate cognitive ability and makes the allocation of individuals depend more on innate ability and less on social background a social allocation based on innate ability and high growth will thus reinforce each other implying the possibility of multiple endogenous growth equilibria

anonymity efficiency wages and technological progress although the industrial revolution is often characterized as the culmination of a process of commercialisation the precise nature of such a link remains unclear this paper provides an analysis of one such link the role of commercialisation in raising wages as impersonal labour market transactions replace personalized customary relations in the presence of an aggregate capital externality we show that the resulting shift in relative factor prices will under certain conditions lead to higher capital intensity in the production technology and hence a faster rate of technological progress we provide historical evidence using european data to show that england was among the most urbanized and the highest wage countries at the onset of the industrial revolution the model highlights the effects of changes in the availability of information typical of a modernising country on efficiency wages and technological progress

educational opportunity and income inequality affordable higher education is and has been a key element of social policy in the united states with broad bipartisan support financial aid has substantially increased the number of people who complete university generally thought to be a good thing we show however that making education more affordable can increase income inequality the mechanism that drives our results is a combination of credit constraints and the signaling role of education first explored by spence 1973 when borrowing for education is difficult lack of a college education could mean that one is either of low ability or of high ability but with low financial resources when government programs make borrowing easier or tuition more affordable high ability persons become educated and leave the uneducated pool driving down the wage for unskilled workers and raising the skill premium

what accounts for the decline in crime in this article we analyze recent trends in aggregate property crime rates in the united states we propose a dynamic equilibrium model that guides our quantitative investigation of the major determinants of observed patterns of crime our main findings can be summarized as follows first the model is capable of reproducing the drop in crime between 1980 and 1996 second the most important factors that account for the observed decline in property crime are the higher apprehension probability the stronger economy and the aging of the population third the effect of unemployment on crime is negligible fourth the increased inequality prevented an even larger decline in crime overall our analysis can account for the behavior of the time series of property crime rates over the past quarter century

incarceration length employment and earnings this paper estimates effects of increases in incarceration length on employment and earnings prospects of individuals after their release from prison i utilize a variety of research designs including controlling for observable factors and using instrumental variables for incarceration length based on randomly assigned judges with different sentencing propensities the results show no consistent evidence of adverse labor market consequences of longer incarceration length using any of the analytical methods in either the state system in florida or the federal system in california

juvenile incarceration human capital and future crime evidence from randomly assigned judges over 130 000 juveniles are detained in the united states each year with 70 000 in detention on any given day yet little is known about whether such a penalty deters future crime or interrupts social and human capital formation in a way that increases the likelihood of later criminal behavior this article uses the incarceration tendency of randomly assigned judges as an instrumental variable to estimate causal effects of juvenile incarceration on high school completion and adult recidivism estimates based on over 35 000 juvenile offenders over a 10 year period from a large urban county in the united states suggest that juvenile incarceration results in substantially lower high school completion rates and higher adult incarceration rates including for violent crimes in an attempt to understand the large effects we found that incarceration for this population could be very disruptive greatly reducing the likelihood of ever returning to school and for those who do return significantly increasing the likelihood of being classified as having an emotional or behavioral disorder jel codes k140 i210

income distribution and macroeconomics this paper analyzes the role of wealth distribution in macroeconomics through investment in human capital it is shown that in the presence of credit markets imperfections and indivisibilities in investment in human capital the initial distribution of wealth affects aggregate output and investment both in the short and in the long run as there are multiple steady states this paper therefore provides an additional explanation for the persistent differences in per capita output across countries furthermore the paper shows that cross country differences in macroeconomic adjustment to aggregate shocks can be attributed among other factors to differences in wealth and income distribution across countries

project cost comparison under the clean development mechanism to inform investment selection by industrialized countries this is the first study that comprehensively evaluates and compares the average costs of six types of 4061 registered clean development mechanism cdm projects the projects were conducted from 2005 to 2014 by industrialized countries investing in host countries that had various technology and income levels specifically this study compares the average costs of emission reduction for each type of project projects were used by industrialized countries to achieve specific emission reductions commitments the lowest average cost per ton of reduced emissions found in renewable energy projects fuel switch projects supply side energy efficiency improvements and demand side energy efficiency improvements all of which were effectively reduced emissions by less than 1 million tons in host countries with high technology levels and upper medium income levels the average cost for the other two project types methane reduction and methane avoidance showed that these projects were more effective at reducing emissions by more than 50 million tons in host countries with upper middle technology levels and upper medium income levels these lowest average costs for different project types can guide project selection by industrialized countries seeking the lowest total emission reduction costs selection of cdm project investments by industrialized countries should account not only for the technology and income levels of host countries but also for the amounts by which industrialized countries have committed to reducing their emissions

sources of earnings inequality estimates from an on the job search model of the us labor market since the early 1980s the labor market in the united states has seen a substantial increase in earnings dispersion we study the issue by developing an on the job search model of the us labor market that allows for wage and employment mobility as a result of optimal individual behavior we estimate its structural parameters on psid data at different points in time to clarify the sources of the evolution of earnings inequality and instability between 1987 and 1996 this procedure allows to compute lifetime measure of inequality on top of the usual cross sectional measure of inequality and provide counterfactual experiments that evaluate the contribution of different parameters to changes over time by taking into account some equilibrium effects we find that the increase in lifetime inequality and in cross sectional inequality have been generated by different sources and that these sources are different by skills changes in the wage offer distribution are the main determinant of the increase in inequality for skilled workers while both mobility changes and wage offer distribution changes are needed to explain changes for the unskilled

payments for ecosystem services as commodity fetishism abstract payments for ecosystem services pes economically reward resource managers for the provision of ecosystem services and are thus characterised by i an ecological function subject to trade ii the establishment of a standard unit of exchange iii and supply demand and intermediation flows between those who sell and buy ecosystem services this paper departs from the term commodity fetishism broadly understood as the masking of the social relationships underlying the process of production to illuminate three invisibilities in the commodification of ecosystem services firstly we argue that narrowing down the complexity of ecosystems to a single service has serious technical difficulties and ethical implications on the way we relate to and perceive nature secondly the commodification of ecosystem services denies the multiplicity of values which can be attributed to these services since it requires that a single exchange value is adopted for trading finally we suggest that the process of production exchange and consumption of ecosystem services is characterised by power asymmetries which may contribute to reproducing rather than addressing existing inequalities in the access to natural resources and services

should the personal computer be considered a technological revolution evidence from u s metropolitan areas the introduction and diffusion of personal computers are widely viewed as a technological revolution using u s metropolitan area level panel data this paper asks whether links between pc adoption educational attainment and the return to skill conform to a model of technological revolutions in which the speed and extent of adoption are endogenous the model implies that cities will adjust differently to the arrival of a more skill intensive means of production with the returns to skill increasing most where skill is abundant and its return is low we show that the cross city data fit many of the predictions of the model during the period 1980 2000 the pc diffusion era

financial development and wage inequality theory and evidence we argue that financial market development contributed to the rise in the skill premium and residual wage inequality in the us since the 1980s we present an endogenous growth model with imperfect credit markets and establish how improving the efficiency of these markets affects modes of production innovation and wage dispersion between skilled and unskilled workers the experience of us states following banking deregulation provides empirical support for our hypothesis we find that wages of college educated workers increased by between 0 5 1 2 following deregulation while those of workers with a high school diploma fell by about 2 2 similarly residual or within group inequality increased the 90 50 percentile ratio of residuals from a mincerian wage regression and their standard deviation increased by 4 5 and 1 8 respectively

government spending composition technical change and wage inequality in this paper we argue that government spending played a significant role in stimulating the wave of innovation that hit the u s economy in the late 1970s and in the 1980s as well as the simultaneous increase in inequality and in education attainments since the late 1970s u s policymakers began targeting commercial innovations more directly and explicitly we focus on the shift in the composition of public demand toward high tech goods which by increasing the market size of innovative firms functions as a de facto innovation policy tool we build a quality ladders non scale growth model with heterogeneous industries and endogenous supply of skills and show that an increase in the technological content of public spending stimulates r d raises the wage of skilled workers and at the same time stimulates human capital accumulation a calibrated version of the model suggests that government policy explains between 12 and 15 of the observed increase in wage inequality in the period 1976 1991 jel e62 j31 o33 o41

the impact of education expansion on wage inequality abstarctthe findings on education expansion and income inequality have important implications for policymakers to implement effective policies to reduce income inequality this study attempts to explain how education expansion affects income inequality by education distribution and the rate of return to education we decompose the effect of education expansion on wage gaps into price effect and structure effect we compare the income inequality from 2002 to 2013 using the chinese household income project chip 2002 and chip2013 survey data and employ ffl decomposition method our findings suggest that income inequality increased in 2013 and that income inequality among the high income groups increased even more significantly the structure effect of education expansion on income inequality is negative when average education increases one year the income gap between 80th and 20th will decrease 1 2 in other words education expansion decreases income inequality by allowing a wide range of individuals t

ban the box convictions and public employment ban the box btb policies mandate deferred access to criminal history until later in the hiring process however these policies chiefly target public employers the study is the first to focus on the primary goal of btb reform by measuring the impact of btb policies on the probability of public employment for those with convictions to execute the analyses the study uses data from the national longitudinal survey of youth 1997 cohort 2005 2015 and difference in difference dd estimation the study finds that btb policies raise the probability of public employment for those with convictions by about 30 on average some scholars argue that btb policies encourage statistical discrimination against young low skilled minority males the study employs triple difference ddd estimation to test for statistical discrimination but uncovers no evidence to support the hypothesis jel j15 j71 j78 k4

complementary credit networks and macroeconomic stability switzerland s wirtschaftsring abstract the swiss wirtschaftsring economic circle credit network founded in 1934 provides residual spending power that is highly counter cyclical individuals are cash short in a recession and economize by greater use of wir credits a money in the production function mipf specification implies that transactions in wir form a stabilizing balance that makes up for the lack of ordinary currency thus unlike the ordinary money wir money is negatively correlated with gdp in the short run this implication is confirmed by empirical estimates such credit networks play a stabilizing role that should be considered in monetary policy

a socio economic model of stigma and related social problems abstract recent years have seen a rapid expansion of economic literature on stigma a notion that had been widely studied in sociology in relation to social deviance yet the economic literature overlooks the original sociological intuition that certain consequences of stigmatization could be socially inefficient this paper formalizes this intuition by developing a model of community behavior which mimics a classic sociological setting concerning the rehabilitation of a former criminal offender the conditions under which a socially inefficient equilibrium arises are derived some of those conditions are shown to be consistent with the findings from micro labor studies on crime

the macroeconomics of specificity specific quasi rents arise in a variety of economic relationships and are exposed to opportunism unless fully protected by contract rent appropriation has important macroeconomic consequences resources are underutilized factor markets are segmented production suffers from technological sclerosis job creation and destruction are unbalanced recessions are excessively sharp and expansions run into bottlenecks while depending on the shock expansions may require reinforcement or stabilization recessions should typically be softened in the long run institutions may evolve to alleviate the problem by balancing appropriation technology choice will also be affected with the appropriated factor partially excluding the other from production to reduce appropriation

understanding the evolution of the us wage distribution a theoretical analysis in this paper we propose an analytically tractable overlapping generations model of human capital accumulation and study its implications for the evolution of the us wage distribution from 1970 to 2000 the key feature of the model and the only source of heterogeneity is that individuals differ in theirabilitytoaccumulatehumancapital therefore wageinequalityresultsonlyfromdifferencesin human capital accumulation we examine the response of this model to skill biased technical change sbtc theoretically we show that in response to sbtc the model generates behavior consistent with some prominent trends observed in the us data including i a rise in overall wage inequality both in the short run and long run ii an initial fall in the education premium followed by a strong recovery leading to a higher premium in the long run iii the fact that most of this fall and rise takes place among younger workers iv a rise in within group inequality v stagnation in median wage growth and a slowdown in aggregate labor productivity and vi a rise in consumption inequality that is much smaller than the rise in wage inequality these results suggest that the heterogeneity in the ability to accumulate human capital is an important feature for understanding the effects of sbtc and interpreting the transformation of the us labor markets since the 1970s jel e21 e24 j24 j31

public schooling college subsidies and growth abstract how does the mix of public education expenditures across primary and secondary k 12 education and post secondary college education influence economic growth to address this i build an overlapping generations endogenous growth model human capital is accumulated through compulsory k 12 education and through optional college education government uses tax revenue to provide quality in k 12 schooling and to subsidize college tuition when total expenditures are small all funds should provide k 12 quality when expenditures are above a critical value a positive share should subsidize tuition the share should increase with total expenditures and with the degree of complementarity of human capital accumulated through the two types of education also increased education spending is more likely to increase growth when a larger share subsidizes tuition

product cycles endogenous skill acquisition and wage inequality this paper presents an endogenous product cycle overlapping generations model where the supply of skilled labour is endogenously determined this is used to examine how production shifts through imitation by developing countries affect the do mestic wage differential and supply of skilled labour in developed countries in the model production shifts increase the demand for researchers in developed countries and cause higher relative wages for skilled labour this leads to more individuals acquiring the skills as a consequence the model helps to explain the simultaneous increase in the domes tic wage gap and in the supply of skilled labour observed in developed countries jel classification f16 j31

identifying the effect of unemployment on crime abstract in this paper we analyze the relationship between unemployment and crime using u s state data we estimate the effect of unemployment on the rates of seven felony offenses we control extensively for state level demographic and economic factors and estimate specifications that include state specific time trends state effects and year effects in addition we use prime defense contracts and a state specific measure of exposure to oil shocks as instruments for unemployment rates we find significantly positive effects of unemployment on property crime rates that are stable across model specifications our estimates suggest that a substantial portion of the decline in property crime rates during the 1990s is attributable to the decline in the unemployment rate the evidence for violent crime is considerably weaker however a closer analysis of the violent crime of rape yields some evidence that the employment prospects of males are weakly related to state rape rates

optimal higher education enrollment and productivity externalities in a two sector model abstract we analyze the optimal share of the skilled workforce over the course of development with two sectors using skilled and unskilled labor respectively and technological spillovers from higher education enrollment productivity in each sector depends on the average quality of workers and the size of the workforce when skill biased technological change prevails this structure of externalities coupled with the endogenous ability sorting of workers may well produce a pattern of overenrollment in early and late stages of development and underenrollment in between our normative analysis is followed by a positive analysis exploring how policy would differ under alternative political objectives

new foundations for ecological economics abstract ecological economics has been repeatedly described as transdiciplinary and open to including everything from positivism to relativism i argue for a revision and rejection of this position in favour of realism and reasoned critique looking into the ontological presuppositions and considering an epistemology appropriate for ecological economics to meaningfully exist requires rejecting the form of methodological pluralism which has been advocated since the start of this journal this means being clear about the differences in our worldview or paradigm from others and being aware of the substantive failures of orthodox economics in addressing reality this paper argues for a fundamental review of the basis upon which ecological economics has been founded and in so doing seeks improved clarity as to the competing and complementary epistemologies and methodologies in part this requires establishing serious interdisciplinary research to replace superficial transdisciplinary rhetoric the argument places the future of ecological economics firmly amongst heterodox economic schools of thought and in ideological opposition to those supporting the existing institutional structures perpetuating a false reality of the world s social environmental and economic systems and their operation

finance inequality nexus the long and the short of it financial development affects income inequality differently in the short and in the long term investigating oecd countries from 1870 2011 we find in the short run an improvement in financial development tends to reduce inequality while in the long run more finance contributes to more inequality the short run effect concurs with theories advocating financial development increases the availability of financial services primarily for the poor however this effect becomes nil within a few years results thus imply that policies aimed at reducing inequality through improving access of the poor to finance need to be carefully designed to ensure longevity of impact

how unregulated is the u s labor market the penal system as a labor market institution1 comparative research contrasts the corporatist welfare states of europe with the unregulated u s labor market to explain low rates of u s unemployment in the 1980s and 1990s in contrast this article argues that the u s state made a large and coercive intervention into the labor market through the expansion of the penal system the impact of incarceration on unemployment has two conflicting dynamics in the short run u s incarceration lowers conventional unemployment measures by removing able bodied working age men from labor force counts in the long run social survey data show that incarceration raises unemployment by reducing the job prospects of ex convicts strong u s employment performance in the 1980s and 1990s has thus depended in part on a high and increasing incarceration rate

education technologies wages and technological progress abstract we analyze the worker s incentives to acquire skills under technological progress when the costs of education are endogenous and depend on the wage distribution we show that the agent s intergenerational elasticity of substitution plays then a relevant role in determining how incentives and the long run wage distribution react to technological progress moreover whenever poverty traps of unskilled workers exist higher rates of technological progress can even decrease the incentives of low skill workers to acquire skills we also analyze the effects of educational subsidies in contrast with previous analytical findings we obtain that subsidies always decrease the long run skill premium finally we study the efficiency of the resulting competitive equilibria

the effect of arrests on the employment and earnings of young men many young men commit crime and many are arrested i estimate the effect of arrests on the employment and earnings of arrestees using a large longitudinal data set constructed by merging police records with ui earnings data i find that the effects of arrests are moderate in magnitude and rather short lived

changes in the structure of earnings during the polish transition abstract we document changes in the structure of earnings during the economic transition in poland we find that inequality in labor earnings increased substantially from 1988 to 1996 a common view is that the reallocation of workers from a public sector with a compressed wage distribution to a private sector with much higher wage inequality accounts for the bulk of increased earnings inequality during transition see e g the models of aghion and commander 1999 aghion philippe commander simon 1999 on the dynamics of inequality in the transition economics of transition 7 275 2898 and commander and tolstopiatenko 1998 commander simon tolstopiatenko andrei 1998 the role of unemployment and restructuring in the transition in commander simon ed enterprise restructuring and unemployment in models of transition the world bank washington pp 169 192 however our decomposition of the sources of the increase in inequality suggests that this compositional effect accounts for only 39 of the increase fully 52 of the increase is due to the increase in the variance of wages within sectors that is earnings inequality within both the private and public sectors grew substantially and by similar amounts this is consistent with prior work suggesting that even state owned enterprises in poland moved towards competitive wage setting as they restructured see e g pinto et al 1993 pinto brian belka marek krajewski stefan 1993 transforming state enterprises in poland evidence on adjustment by manufacturing firms brookings papers on economic activity 213 70 commander and dhar 1998 commander simon dhar sumana 1998 enterprises in the polish transition in simon commander ed enterprise restructuring and unemployment in models of transition the world bank washington pp 109 142 a substantial part of the increase in earnings inequality was between group due largely to increased education premiums however changes in inequality within education experience gender groups account for about 60 percent of the increase in overall earnings inequality the increases in within group inequality were very different across skill groups with much larger increases for highly educated workers these patterns hold in both the private and public sectors although increases in education premiums were somewhat greater in the private sector

when does privatization work the impact of private ownership on corporate performance in the transition economies this paper compares the performance of privatized and state firms in the transition economies of central europe while controlling for various forms of selection bias it argues that privatization has different effects depending on the types of owners to whom it gives control in particular privatization to outsider but not insider owners has significant performance effects where privatization is effective the effect on revenue performance is very pronounced but there is no comparable effect on cost reduction overlooking the strong revenue effect of privatization to outsider owners leads to a substantial overstatement of potential employment losses from postprivatization restructuring

the use of criminal record in employment decisions the rights of ex offenders employers and the public the evidence suggests that employers discriminate against ex offenders in the labour market the problem is potentially serious as it involves a substantial proportion of the population especially the male population since research has shown that most people with prior convictions stop offending by their late 20s or early 30s the validity of selection based on criminal record remains questionable this paper examines the need for legal protection of ex offenders by limiting employers access to and use of information on criminal background the rights and interests of the various parties involved employers ex offenders and the general public are discussed approaches to the legal protection of ex offenders in australia are reviewed and legislative changes proposed

the transition from school to jail youth crime and high school completion among black males abstract in this paper we study the relationship among schooling youth employment and youth crime the framework a multinomial discrete choice vector autoregression provides a comprehensive analysis of the dynamic interactions among a youth s schooling work and crime decisions and arrest and incarceration outcomes we allow for observable initial conditions unobserved heterogeneity measurement error and missing data we use data from the nlsy97 on black male youths starting from age 14 the estimates indicate important roles both for heterogeneity in initial conditions and for stochastic events that arise during one s youth in determining outcomes as young adults

trends in quality adjusted skill premia in the united states 1960 2000 this paper presents new evidence that increases in college enrollment lead to a decline in the average quality of college graduates between 1960 and 2000 resulting in a decrease of 8 percentage points in the college premium the standard demand and supply framework katz and murphy 1992 card and lemieux 2001 can qualitatively account for the trend in the college and age premia over this period but the quantitative adjustments that need to be made to account for changes in quality are substantial furthermore the standard interpretation of the supply effect can be misleading if the quality of college workers is not controlled for to illustrate the importance of these adjustments we reanalyze the problem studied in card and lemieux 2001 who observe that the rise in the college premium in the 1980s occurred mainly for young workers and attribute this to the differential behavior of the supply of skill between the young and the old our results show that changes in quality are as important as changes in prices to explain the phenomenon they document

local labor markets and criminal recidivism abstract this paper estimates the impact of local labor market conditions on criminal recidivism using administrative prison records on four million offenders released from 43 states between 2000 and 2013 exploiting the timing of each offender s release from prison i find that being released to a county with higher low skilled wages significantly decreases the risk of recidivism the impact of higher wages on recidivism is larger for both black offenders and first time offenders and in sectors that report being more willing to hire ex offenders these results are robust to individual and county level controls such as policing and corrections activity and do not appear to be driven by changes in the composition of released offenders during good or bad economic times

the effect of employment frictions on crime this article provides estimates on how long it takes for released inmates to find a job and when they find a job how less likely they are to be incarcerated an on the job search model with crime is used to model criminal behavior derive the estimation method and analyze policies including a job placement program the results show that the unemployed are incarcerated twice as fast as the employed and take on average 6 months to find a job the article demonstrates that reducing the average unemployment spell of previously incarcerated criminals by 3 months reduces crime and recidivism by more than 5

the race between man and machine implications of technology for growth factor shares and employment we examine the concerns that new technologies will render labor redundant in a framework in which tasks previously performed by labor can be automated and new versions of existing tasks in which labor has a comparative advantage can be created in a static version where capital is fixed and technology is exogenous automation reduces employment and the labor share and may even reduce wages while the creation of new tasks has the opposite effects our full model endogenizes capital accumulation and the direction of research towards automation and the creation of new tasks if the long run rental rate of capital relative to the wage is sufficiently low the long run equilibrium involves automation of all tasks otherwise there exists a stable balanced growth path in which the two types of innovations go hand in hand stability is a consequence of the fact that automation reduces the cost of producing using labor and thus discourages further automation and encourages the creation of new tasks in an extension with heterogeneous skills we show that inequality increases during transitions driven both by faster automation and introduction of new tasks and characterize the conditions under which inequality is increasing or stable in the long run

the effect of drug prohibition on drug prices evidence from the markets for cocaine and heroin this paper examines the effect of drug prohibition on the black market prices of cocaine and heroin the paper examines the ratio of retail to farmgate price for cocaine heroin and several legal goods and it compares legal versus black market prices for cocaine and heroin the results suggest that cocaine and heroin are substantially more expensive than they would be in a legalized market but to a lesser degree than suggested in previous research

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

ecosystem services as technology of globalization on articulating values in urban nature the paper demonstrates how ecosystem services can be viewed and studied as a social practice of value articulation with this follows that when ecosystem services appear as objects of calculated va

make money surfing the web the impact of internet use on the earnings of u s workers much research on the digital divide presumes that adults who do not use the internet are economically disadvantaged yet little research has tested this premise after discussing several mechanisms that might produce differences in earnings growth between workers who do and do not use the internet we use data from the current population survey to examine the impact of internet use on changes in earnings over 13 month intervals at the end of the internet boom our analyses reveal robustly significant positive associations between web use and earnings growth indicating that some skills and behaviors associated with internet use were rewarded by the labor market consistent with human capital theory current use at work had the strongest effect on earnings in contrast to economic theory which has led economists to focus exclusively on effects of contemporaneous workplace technology use workers who used the internet only at home also did better suggesting that users may have benefited from superior

contracting productivity growth in this paper we analyze the interactions between growth and the contracting environment in the production sector allowing incompleteness in contracting implies that viable production relationships for firms and workers and therefore the profitability of industries depend on the rates of innovation and growth the speed at which new innovations arrive in turn depends on the profitability of production for the usual reasons examined in the endogenous growth literature we show that these interactions can have important implications which are consistent with observed phenomena in both the micro and macro environment in particular we demonstrate that a technological shock increasing productivity of research can through this interaction lead to a productivity slowdown and a shift in labor market contracts away from firms providing implicit guarantees of lifetime employment and towards shorter term contractor type arrangements we show the consistency of an increase in the proportion of the labor force under short term employment increased relative returns of workers in high productivity sectors and increased income inequality with a productivity slowdown of finite duration

sequencing strategies in large competitive ascending price automobile auctions an experimental examination this paper reports on a large scale field experiment testing strategies available to a seller participating in simultaneous competitive sequential ascending price automobile auctions every other week the seller offered approximately 120 vehicles for sale in an auction environment in which several competitive sellers offered on the order of 3 000 vehicles the experiment tested various sequences in which the seller could offer the vehicles such as high values first or low values first surprisingly and contrary to intuition drawn from the theory of single item and single seller auctions the worst performing sequence from those tested is for the seller to order vehicles from highest to lowest values the best sequence is to group the vehicles by type and offer the low valued vehicles first and then move to offer the higher valued vehicles our conjecture is that this sequence reduces the competition with other sellers for the attention of specialized buyers

crime rates and labor market opportunities in the philippines 1970 2008 abstract the paper estimates the impact of labor market variables on crime in the philippines using national level time series and regional level panel data the evidence suggests that wage rate and labor force participation rate have stronger effect on crime than criminal deterrence variables

differences and changes in wage structures preface introduction and summary richard b freeman lawrence f katz 1 a comparison of changes in the structure of wages in four oecd countries lawrence f katz gary w loveman david g blanchflower 2 international differences in executive and managerial compensation john m abowd michael l bognanno 3 the gender earnings gap some international evidence francine d blau lawrence m kahn 4 international wage curves david g blanchflower andrew j oswald 5 the changing structure of male earnings in britain 1974 1988 john schmitt 6 real wages employment and wage dispersion in u s and australian labor markets robert g gregory francis vella 7 labor markets and economic growth lessons from korea s industrialization 1970 1990 dae il kim robert h topel 8 wage differentials in italy market forces institutions and inflation christopher l erickson andrea c ichino 9 the swedish wage structure the rise and fall of solidarity wage policy per anders edin bertil holmlund 10 getting together and breaking apart the decline of centralized collective bargaining richard b freeman robert s gibbons 11 earnings inequality in germany katharine g abraham susan n houseman 12 a comparative analysis of east and west german labor markets before and after unification alan b krueger jorn steffen pischke contributors author index subject index

occupational mobility and wage inequality in this article we argue that wage inequality and occupational mobility are intimately related we are motivated by our empirical findings that human capital is occupation specific and that the fraction of workers switching occupations in the u s was as high as 16 a year in the early 1970 s and had increased to 21 by the mid 1990 s we develop a general equilibrium model with occupation specific human capital and heterogeneous experience levels within occupations we find that the model calibrated to match the level of occupational mobility in the 1970 s accounts quite well for the level of within group wage inequality in that period next we find that the model calibrated to match the increase in occupational mobility accounts for over 90 of the increase in wage inequality between the 1970 s and the 1990 s the theory is also quantitatively consistent with the level and increase in the short term variability of earnings copyright wiley blackwell

the brain drain and the world distribution of income abstract skilled emigration or brain drain from developing to developed countries is becoming the dominant pattern of international migration today such migration is likely to affect the world distribution of income both directly through the mobility of people and indirectly as the prospect of migration affects the rate of return to education in both the sending and receiving economies this migration pattern will therefore affect human capital accumulation and fertility decisions in both the sending and receiving economies this paper analyzes these effects in a dynamic two country model of the world economy where agents in both countries make optimal fertility and human capital decisions the implications of the analysis for the world distribution of income are derived in the light of recent empirical findings of the brain drain literature the analysis shows that the current trend towards predominantly skilled emigration from poor to rich countries may in the long run increase inequality in the world distribution of income as relatively poor countries grow large in terms of population in the short run however it is possible for world inequality to fall due to rises in gdp per capita in large developing economies with sufficiently low skilled emigration rates

labor market institutions and wage inequality the authors investigate how labor market institutions such as unemployment insurance unions firing regulations and minimum wages have affected the evolution of wage inequality among male workers results of estimations using data on institutions in eleven oecd countries indicate that changes in labor market institutions can account for much of the change in wage inequality between 1973 and 1998 factors found to have been negatively associated with male wage inequality are union density the strictness of employment protection law unemployment benefit duration unemployment benefit generosity and the size of the minimum wage over the 26 year period institutional changes were associated with a 23 reduction in male wage inequality in france where minimum wages increased and employment protection became stricter but with an increase of up to 11 in the united states and united kingdom where unions became less powerful and in the united states minimum wages fell

ability biased technological transition wage inequality and economic growth thispaper develops a growthmodel characterizedbyability biasedtechnological transition in which the evolution of technology education attainment and wage inequality is consistent with the observed pattern in the united states and other advanced countries over the past several decades it argues that an increase in the rate of technological progress raises the return to ability and simultaneously generates an increase in wage inequality between and within groups of skilled and unskilled workers an increase in average wages of skilled workers a temporary decline in average wages of unskilled workers an increase in education and a productivity transitory slowdown

international competition downsizing and wage inequality a country with cournot competition and free entry experiences an increase of its market size either due to economic growth or international integration of its goods markets this implied increase in competition leads to shrinking mark ups and forces firms to reduce overhead costs relative to output this implies a reallocation at the aggregate level from administrative to productive activities relative factor rewards change and wage inequality increases the factor which loses in relative terms can even lose in real terms from a quantitative perspective international competition is demonstrated to be the more plausible cause of rising wage inequality c 2007 published by elsevier b v

firm heterogeneity in capital labour ratios and wage inequality author s leonardi marco abstract this paper documents the increasing dispersion of capital labor ratios across firms in the us and provides some empirical evidence of a positive correlation at the two digit industry level between the dispersion of capital labor ratios across firms and residual wage inequality to explain this empirical fact the paper adopts a search model where firms differ in their optimal capital investment the exogenous decline in the relative price of equipment capital makes the distributions of capital labor ratios more dispersed in a frictional labor market this force generates wage dispersion among identical workers ols estimates of the relationship between capital dispersion and the relative price of equipment capital support the main hypothesis of the model

revealing ecological processes or imposing social rationalities the politics of bounding and measuring ecosystem services ecosystem service es frameworks have been developed to characterize and model the relationships between ecological processes and human benefits some argue that these relationships should be specified through expert derived analytical i e top down frameworks in order to organize accumulated knowledge and create ready made framings for communities on the ground in contrast arguments for the participatory construction of es assessments emphasize the need for place sensitive and deliberative i e bottom up approaches in this paper we draw on a novel water planning exercise in new zealand to examine the tensions that arise when expert produced categories intersect with diverse stakeholder worldviews and aspirations expert derived es categories and analyses intervene in local valuation contexts in a range of ways narrowing the scope of which ecological processes might be considered as relevant or legitimate bounding as well as affecting how these processes are described and compared measuring the practices of bounding and measuring es in scientific and planning assessments should thus be conceptualized as involving political work and not just scientific judgment this reframes the role of ecological science and scientists in es debates and this presents cautions as well as opportunities for future es work relating to policy

does incarceration length affect labor market outcomes abstractthis paper studies how longer incarceration spells affect offenders labor market outcomes by using a reform that increased incarceration lengths by approximately 1 month i use detailed register data for offenders who predominantly serve incarceration spells of 1 2 months i analyze the sample for several years prior to and after incarceration and show that the reform led to an exogenous increase in incarceration lengths i find that the longer incarceration spells result in lower unemployment rates and higher earnings possibly because marginal increases in short incarceration spells improve conditions and incentives for rehabilitation while the costs of jail related to these outcomes are unaffected i show that the estimates are robust to different econometric specifications and further provide evidence that my results are not driven by changes in macroeconomic conditions

college entry by blacks since 1970 the role of college costs family background and the returns to education college enrollment of black 18 19 year old high school graduates declined from 1980 through 1984 and then rebounded after 1984 this paper presents data from a time series of cross sections of 18 19 year old youths from 1973 through 1988 to test the role of family background direct college costs local economic conditions and returns to college in driving these trends the evidence suggests that on the one hand increases in direct college costs were driving enrollment rates downward throughout the eighties on the other hand dramatic increases in average parental education for black youths exerted upward pressure on college enrollment by blacks particularly in the latter half of the decade the net effect of these two factors contributed to the pattern of decline and recovery observed during the eighties

how we come to value nature a pragmatist perspective abstract valuation studies have been mobilized to demonstrate the importance of nature to society and to incorporate concerns about nature into decision making although increasingly popular in ecosystem service research such studies have also been criticized in particular tensions between the assumptions of valuation methods and the real life processes of valuing have been identified this article argues that a process based pragmatist approach to valuing helps to evaluate the relevance of valuation studies results pragmatism proposes a focus on activities through which people come to value natural elements in their everyday life rather than on the outcomes of valuing processes using this approach we examine three empirical cases 1 restoration of natural springs in finland 2 protection of the bearded vulture in the french alps and 3 management of urban biodiversity in the city of grenoble france through these cases we demonstrate how nature s value to people emerges from commonplace ways of engaging with natural elements such as domestication inheriting and community building we conclude by discussing the usefulness of acknowledging this kind of processes in nature conservation

imprisonment and labor market outcomes evidence from a natural experiment because of racially disproportionate imprisonment rates the literature on mass incarceration has focused on the labor market consequence of imprisonment and the implications of those effects for r

technical progress and early retirement this paper claims that technical progress induces early retirement of older workers it presents a model where human capital is technology specific so that technical progress erodes some existing human capital this affects mostly older workers who have a smaller incentive to learn the new technology since their career horizon is shorter hence they tend to work less we find support to this erosion effect in hrs data which shows that retirement and unemployment of older workers are positively related to technical progress in their sectors unlike the effect across sectors the model is ambiguous about the aggregate effect of technical progress on labor supply of older workers while in sectors with many innovations it falls due to the erosion effect in other sectors it increases due to higher wages to examine which effect dominates we run a time series test using us data and find that the rate of average technical progress reduces aggregate labor force participation by the old namely the erosion effect dominates

the diffusion of computers and the distribution of wages abstract when the costs are decreasing workers adopt technology at the point where the costs equal the increased productivity output per worker increases immediately while productivity benefits increase only gradually if costs continue to fall as a result workers in computer adopting labor market groups experience an immediate fall in wages due to increased supply on the other hand adopting workers experience wage increases with some delay this model explains why increased computer use does not immediately lead to higher wage inequality more specifically the results of the model are shown to be consistent with the question why within group wage inequality among skilled workers as a result of computer technology adoption in the united states increased in the 1970s while between group wage inequality and within group wage inequality among the unskilled did not start to increase until the 1980s the model also predicts that the more compressed german wage structure leads to a lagged diffusion of computer technology along with smaller changes in wage inequality our empirical analysis suggests that this is consistent with the actual developments in germany since the 1980s finally the theoretical predictions seem to be of the right magnitude to explain the empirical quantities observed in the data

wage inequality and the new economy many economists have argued that the observed increase in wage inequality in developed economies over the past 30 years is due to skill biased technical progress in this paper we put forward a somewhat different technology based argument namely that the increased inequality was caused by technical change linked to the pervasive innovation wave associated with the new economy this technical change was not skill biased in the usual sense but rather raised the reward to adaptability this alternative approach based on the notion of general purpose technology can shed light on a number of outstanding puzzles on the evolution of wage inequality both between and within educational groups

labour market discrimination against former juvenile delinquents evidence from a field experiment in view of policy action to integrate ex offenders into society it is important to identify the underlying mechanisms of the negative relationship between criminal record on the one hand and later employment and earnings on the other hand in this study we identify hiring discrimination against former juvenile delinquents in a direct way to this end we conduct a field experiment in the belgian labour market we find that labour market discrimination is indeed a major barrier in the transition to work for former juvenile delinquents labour market entrants disclosing a history of juvenile delinquency get about 22 less callback compared to their counterparts without a criminal record this discrimination is heterogeneous by the occupation for which one applies