cooperative and noncooperative r d in duopoly with spillovers contrary to the usual assumption made in most oligopoly models relations among firms are seldom of a wholly cooperative or noncooperative type in many situations they compete in some fields while they cooperate in others an important example is the case of cooperative research efforts bringing fierce competitors together two types of agreement are observed first r d cooperation can take place at the so called precompetitive stage companies share basic information and efforts in the r d stage but remain rivals in the market place 1 a second type of agreement involves an extended collusion between partners creating common policies at the product level the usual justifications of this extension are the difficulties of protecting intellectual property the idea is then to allow partners who have achieved inventions together to also control together the processes and products which embody the results of their collaboration in order to recuperate jointly their r d investments 2 what could be expected from these types of agreement is a reduction in r d expenditures because of less wasteful duplication and a reduction of total production because of more reprinted from the american economic review 78 5 1133 1137 1988 center for operations research econometrics 1348 louvain la neuve belgium we are grateful to jean

strategic trade policy intellectual property rights protection and north south trade abstract in this paper we analyze the issue of optimal tariffs when the northern and southern firms compete in quantities in an imperfectly competitive northern market and there are potentially varying degrees of intellectual property rights ipr violation by the south ipr violation is reflected through the leakage of technological knowledge spillovers from the northern to the southern firm creating unit cost reduction it is shown that optimal tariffs in this framework are always higher than in the simple duopoly model since they serve here not only as profit shifting devices but also as instruments that influence domestic innovative activity generate scale economies and countervail the ipr violation of the south the other notable difference from the standard duopoly model is that positive tariffs may be desirable from the world welfare point of view

credit market constraints consumption smoothing and the accumulation of durable production assets in low income countries investments in bullocks in india in this paper we formulate and estimate a finite horizon structural dynamic model of agricultural investment behavior that incorporates the major features of low income agricultural environments income uncertainty constraints on borrowing and rental markets and the use of investment assets to generate income and smooth consumption the model is fit to longitudinal indian household data on farm profits bullock stocks and pump sets the estimated structural parameters are used to assess the effects on the life cycle accumulation of bullocks agricultural profits and welfare associated with complete markets and bullock liquidity and with second best policies that provide assured sources of income to farmers and weather insurance

household coping in war and peacetime cattle sales in rwanda 1991 2001 abstract the economic literature has given due attention to household coping strategies in peacetime in contrast little is known about such strategies in wartime this paper studies the use of cattle as a buffer stock by rwandan households during 1991 2001 a period characterized by civil war and genocide it is found that the probability of selling cattle increases upon the occurrence of both peacetime and wartime covariant adverse income shocks the peacetime cattle sales are largely explained by shifts in the household asset portfolio in contrast in 1994 the year of the genocide almost half of the cattle sales were motivated by the need to buy food however we argue that the effectiveness of this coping strategy was severely reduced due to the wartime conditions first during the year of ethnic violence cattle prices plummeted to less than half of their pre genocide value second we find that households most targeted in the violence did not sell cattle we discuss several explanations for this latter finding

extreme weather and civil war does drought fuel conflict in somalia through livestock price shocks climate change leads to more frequent and more intense droughts in somalia in a global context weather shocks have been found to perpetuate poverty and fuel civil conflict by relating regional and temporal variations in violent conflict outbreaks and drought incidence and severity we show that this causality is also valid for somalia at the local level we find that livestock price shocks drive drought induced conflicts through reducing the opportunity costs of conflict participation our estimation results indicate that a temperature rise of around 3 2 degree celcius corresponding to the median ipcc scenario for eastern africa by the end of the century would lower cattle prices by about 4 percent and in turn increase the number of violent conflict by about 58 percent hence climate change will further aggravate somalia s security challenges and calls for decisive action to strengthen both drought and conflict resilience especially in pastoralist and agropastoralist livelihoods

agricultural production amid conflict separating the effects of conflict into shocks and uncertainty abstract this paper examines the effect of conflict on agricultural production of small farmers first an inter temporal model of agricultural production is developed in which the impact of conflict is transmitted through violent shocks and uncertainty brought about by conflict we test the model using a unique household survey applied to 4800 households in four micro regions of colombia our findings suggest households learn to live amid conflict albeit at a lower income trajectory when presence of non state armed actors prolongs farmers shift to activities with short term yields and lower profitability from activities that require high investments if violence intensifies in regions with presence of non state armed actors farmers concentrate on subsistence activities

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

unequal treatment of identical agents in cournot equilibrium oligopoly models where prior actions by firms affect subsequent marginal costs have been useful in illuminating policy debates in areas such as antitrust regulation environmental protection and international competition we discuss properties of such models when a cournot equilibrium occurs at the second stage aggregate production costs strictly decline with no change in gross revenue or gross consumer surplus if the prior actions strictly increase the variance of marginal costs without changing the marginal cost sum therefore unless the cost of inducing second stage asymmetry more than offsets this reduction in production costs the private and social optima are asymmetric

the cost of fear the welfare effect of the risk of violence in northern uganda although the effects of insecurity are believed to be important these have never been directly measured previous estimates of the costs of conflict have only captured the joint effect of violence and insecurity the distinction is important for understanding the origins of the costs and for policy design spatially disaggregated measures of insecurity are created based on the spatial temporal variation in the placement of violence these are used to generate the first estimates of the relative causal contributions of the risk and experience of violence the article also provides the first micro data based counterpart to the cross country literature on the costs of conflict

the determinants of earnings a behavioral approach we survey the determinants of earnings and propose a framework for understanding labor market success we suggest that the advantages of the children of successful parents go considerably beyond the benefits of superior education the inheritance of wealth or the genetic inheritance of cognitive ability we suggest that noncognitive personality variables such as attitudes towards risk ability to adapt to new economic conditions hard work and the rate of time preference affect both earning and the transmission of economic status across generations

estimating the peace dividend the impact of violence on house prices in northern ireland this article exploits data on the pattern of violence across regions and over time to estimate the impact of the peace process in northern ireland on house prices after establishing a negative correlation between killings and house prices we estimate the parameters of a markov switching model with conflict and peace as latent states we use the model to estimate the size of the peace dividend as captured in house price changes jel d74 r23 r31 conflict in ireland has a long history even after the republic of ireland was created as an independent state in 1920 the status of the mainly protestant north remained contested from the late 1960s a violent conflict flared up which claimed around 3 500 lives only more than two decades later from 1993 onwards emerged a peace process which while initially fragile culminated in a cessation of violence and a return to devolved government by 2007 the conflict was a major source of social and economic dislocation but as peace took hold this has begun to be repaired this paper assesses the impact of peace by using variation in violence within northern ireland to study one important economic aspect of the peace process and the dividend that it brought to residents of northern ireland the impact on house prices houses are assets whose prices reflect the present and future expected attrac tiveness of living in an area even during the height of the conflict in northern ireland violence was not uniform for example belfast the capital city of the province of northern ireland was particularly hard hit looking for economic consequences of the peace process we would therefore expect benefits to be concentrated among areas where violence was most prevalent we exploit within region variability in violence and house prices over time having such variation is rare in studies of the economic consequences of conflict our specific measure of violence is conflict related deaths these have been well documented by sutton 1994 and the conflict archive on the

microcredit and adjustment to environmental shock evidence from the great famine in ireland the great famine of ireland from 1845 to 51 ranks as one of the most lethal of all time claiming approximately one eighth of the country s population utilizing famine relief commission reports to develop a micro level dataset of blight severity i find that in the short run districts more severely infected by blight experienced larger population declines and accumulations of buffer livestock by small to medium sized farms in the medium and long runs however worse affected districts experienced greater substitutions toward other tillage crops and grazing livestock particularly by small to medium sized farms using annual reports of the irish loan funds i further find that access to microfinance credit was an important factor in non demographic adjustment to blight worse affected districts with at least one microfinance fund during the famine experienced substantially smaller relative population declines and larger relative increases in buffer livestock during and immediately after the famine and greater relative medium and long run substitutions toward other crops and grazing livestock than worse affected districts without a fund

the importance of noncognitive skills lessons from the ged testing program it is common knowledge outside of academic journals that motivation tenacity trustworthiness and perseverance are important traits for success in life thomas edison wrote that genius is 1 percent inspiration and 99 percent perspiration most parents read the aesop fable of the tortoise and the hare to their young children at about the same time they read them the story of the little train that could numerous instances can be cited of high iq people who failed to achieve success in life because they lacked self discipline and low iq people who succeeded by virtue of persistence reliability and self discipline the value of trustworthiness has recently been demonstrated when market systems were extended to eastern european societies with traditions of corruption and deceit it is thus surprising that academic discussions of skill and skill formation almost exclusively focus on measures of cognitive ability and ignore noncognitive skills the early literature on human capital e g gary becker 1964 contrasted cognitive ability models of earnings with human capital models ignoring noncognitive traits entirely the signaling literature e g michael spence 1974 emphasized that education was a signal of a one dimensional ability usually interpreted as a cognitive skill most discussions of ability bias in the estimated return to education treat omitted ability as cognitive ability and attempt to proxy the missing ability by cognitive tests most assessments of school reforms stress the gain from reforms as measured by the ability of students to perform on a standardized achievement test widespread use of standardized achievement and ability tests for admissions and educational evaluation are premised on the belief that the skills that can be tested are essential for success in schooling a central premise of the educational testing movement since its inception much of the neglect of noncognitive skills in analyses of earnings schooling and other lifetime outcomes is due to the lack of any reliable measure of them many different personality and motivational traits are lumped into the category of noncognitive skills psychologists have developed batteries of tests to measure noncognitive skills e g robert sternberg 1985 these tests are used by companies to screen workers but are not yet used to ascertain college readiness or to evaluate the effectiveness of schools or reforms of schools the literature on cognitive tests ascertains that one dominant factor g summarizes cognitive tests and their effects on outcomes no single factor has yet emerged to date in the literature on noncognitive skills and it is unlikely that one will ever be found given the diversity of traits subsumed under the category of noncognitive skills studies by samuel bowles and herbert gintis 1976 rick edwards 1976 and roger klein et al 1991 demonstrate that job stability and dependability are traits most valued by employers as ascertained by supervisor ratings and questions of employers although they present no direct evidence on wages and educational t discussants susan mayer university of chicago cecilia rouse princeton university nan maxwell california state university hayward janet currie university of california los angeles

reaping what you sow an empirical analysis of international patent harmonization abstract this paper extends analysis of the gatt uruguay round by quantifying the impact of international patent harmonization as implied by the trips agreement patent harmonization has the capacity to generate large transfers of income between countries the us being the major beneficiary developing countries are major contributors to these transfers but canada the uk and japan also make sizable contributions

intellectual property rights violations and spillovers in north south trade abstract the article examines the role of technological spillovers when northern and southern firms compete in quantities on the common world market and when only the northern firm is supposed to conduct innovative activity the intensity of spillovers is interpreted as an indicator of the strength of intellectual property rights ipr protection in this light the paper reconsiders the questions raised in the recent economic analysis of ipr protection in north south relations when and whether the southern countries benefit in welfare terms from protecting ipr how the north fares in this story how large is the conflict between the north and south and what is the optimal level of ipr protection at the world level the paper shows that the common belief that the south generally benefits from relaxing ipr protection while the north is worse off does not carry over in the applied duopoly model with spillovers in this respect the congruence of interests between north and south with respect to southern ipr protection regime should not be an exceptional or even impossible state of affairs

the consequences of child soldiering abstract little is known about the impacts of military service on human capital and labor market outcomes due to an absence of data as well as sample selection recruits are self selected screened and selectively survive we examine the case of uganda where rebel recruitment methods provide exogenous variation in conscription economic and educational impacts are widespread and persistent schooling falls by nearly a year skilled employment halves and earnings drop by a third military service seems to be a poor substitute for schooling psychological distress is evident among those exposed to severe war violence and is not limited to ex combatants

why understanding smoking bans is important for estimating their effects california s restaurant smoking bans and restaurant sales i introduction a voluminous literature has sought to quantify the effect of smoking bans typically on the quantity of smoking but also on the performance of affected businesses 1 various time periods have been explored types of bans considered locales examined and specifications employed nonetheless the majority of studies share two common failings first smoking bans of a given type e g a restaurant ban are treated as homogenous when in fact such bans have been enacted at various jurisdictional levels municipality county or state at various times in various orders and in various combinations with other types of smoking bans and with similar bans at other jurisdictional levels second empirical specifications do not adequately control for preexisting trends in the dependent variable as a result many studies arrive at fundamentally wrong conclusions we illustrate these points in an investigation of how california s restaurant smoking bans have affected restaurant sales we analyze the effect of smoking bans on restaurant sales for two reasons first the issue plays a role in the policy debate more than 150 studies many published in refereed journals and others in consulting reports undertaken for municipalities have explored whether smoking bans help or hinder restaurants scollo and lal 2005 yet few of these studies properly account for the effects of preexisting trends or changes in trends for the closely related question of ban endogeneity or for ban heterogeneity second restaurant sales data are very rich well measured available by municipality by quarter and over an extended period therefore we can identify effects that would be obscured by cruder data e g periodic survey responses enabling us to draw lessons applicable to studies of the effect of other types of smoking bans e g workplace bans in other dimensions e g smoking prevalence we investigate 267 california municipalities for which the california state board of equalization provides quarterly taxable restaurant sales 2 we begin by employing naive specifications which treat bans as homogenous and control simplistically for trends representative of those typically estimated in the literature the results of our naive specifications indicate that smoking bans have a large negative effect on restaurant revenues however when we examine municipal and state bans separately we find a positive association between municipal bans and restaurant sales and a negative association between the state ban and restaurant sales finally when we control properly for preexisting trends in the dependent variable we find no substantial evidence of any causal relationship running from either municipal bans or the state ban to restaurant sales thus we reach two main conclusions the first is that california s municipal restaurant smoking bans are endogenous in a critical way restaurant sales growth or something correlated with restaurant sales growth appears to cause restaurant bans not vice versa the second is that because communities are heterogenous one must analyze the effect of a ban taking into account the level at which the ban was enacted pooling data and treating smoking bans as homogenous as many studies do is inappropriate cities that impose bans on themselves are likely to differ systematically from those that have bans forced on them by a higher jurisdiction county or state relatedly analyzing and or instrumenting for smoking bans using state level data again as many studies do may fail to capture the relevant variation when the bans have force at a lower level of jurisdiction e g a municipal ban our analysis although focused on restaurant bans and sales has implications for the more extensive literature on how smoking bans influence smoking behavior most importantly it demonstrates the crucial nature of identifying and controlling for trends in the dependent variable whether restaurant revenue as in our data set or smoking rates

do asset transfers build household resilience abstract we estimate the impact of an asset transfer program on household resilience we measure resilience as the probability that a household will sustain at least the threshold asset level required to support consumption above the poverty line using six rounds of data collected over 42 months in rural zambia we construct a measure of resilience based on households conditional welfare distributions to estimate program impacts we find that the program increased household resilience beneficiaries likelihood of being non poor in future periods increased by 44 the program both increased mean assets and decreased variance signaling an upward shift in households conditional asset distributions our method demonstrates the added value of the resilience estimation compared with a conventional impact assessment numerous households classified as non poor are unlikely to remain non poor over time and the relationship between wealth and resilience is driven by changes in both the conditional mean and the conditional variance

saving and economic shocks in rural pakistan abstract this paper adapts the recent methodology of paxson to study saving rates in rural pakistan particular attention is paid to differences in marginal rates of financial and physical saving and how these vary across income groups and by direction of income shocks households exhibit more difficulty in smoothing consumption after successive shocks than with a single shock the study also observes marginal rates of saving out of international remittances and lump sum pensions unlike domestic remittances international remittances appear to be treated much as transitory income shocks

general equilibrium treatment effects a study of tuition policy this paper defines and estimates general equilibrium treatment effects the conventional approach in the literature on treatment effects ignores interactions among individuals induced by the policy interventions being studied focusing on the impact of tuition policy and using estimates from our dynamic overlapping generations general equilibrium model of capital and human capital formation we find that general equilibrium impacts of tuition on college enrollment are an order of magnitude smaller than those reported in the literature on microeconomic treatment effects the assumptions used to justify the late parameter in a partial equilibrium setting do not hold in a general equilibrium setting policy changes induce two way flows we extend the late concept to a general equilibrium setting we present a more comprehensive evaluation to program evaluation by considering both the tax and benefit consequences of the program being evaluated and placing the analysis in a market setting this abstract was borrowed from another version of this item

consumption and income seasonality in thailand many households in developing countries rely on seasonal agriculture for their incomes this paper investigates whether household consumption expenditure tracks income across seasons using data from thailand i contrast the seasonal consumption patterns of households with different seasonal income patterns and estimate the responsiveness of seasonal consumption to seasonal income i find little evidence that consumption tracks income over the course of the year the findings suggest that observed seasonal consumption patterns are the result of seasonal variations in preferences or prices common to all households rather than an inability of households to use savings behavior to smooth consumption

why do southern countries have little incentive to protect northern intellectual property rights instead of focusing on the conflict of interests between north and south the author studies the conflict of interests among southern countries and provides an alternative answer to the question why do southern countries have little incentive to protect northern intellectual property rights owing to the incentive of each southern country to free ride on other southern countries with respect to providing protection the overall protection they provide is not sufficient therefore a new source of mutual gains exists among southern countries and also between north and south a joint effort of southern countries is required to exploit these gains

saving and liquidity constraints this paper is concerned with the theory of saving when consumers are not permitted to borrow and with the ability of such a theory to account for some of the stylized facts of saving behavior the models presented in the paper seem to account for important aspects of reality that are not explained by traditional life cycle models copyright 1991 by the econometric society

endogenous r d and intellectual property laws in developed and emerging economies the incentive of providing protection of intellectual property has been analyzed both for an emerging economy as well as for a developed economy the optimal patent length and the optimal patent breadth within a country are found to be positively related to each other for a fixed structure of laws abroad moreover a country can respond to stronger patent protection abroad by weakening its patent protection under certain circumstances and by strengthening its patent protection under other circumstances these results depend upon the curvature of the r d production function finally we investigate the impact of an increase in the willingness to pay in the emerging economy and find conditions under which there is an improvement in both patent length as well as patent breadth in the emerging economy

consumption versus asset smoothing testing the implications of poverty trap theory in burkina faso abstract despite solid theoretical foundations for the notion that poor borrowing constrained households will intertemporally manage assets to smooth consumption the consumption smoothing hypothesis has not always withstood empirical scrutiny this paper reassesses the intertemporal asset management problem with a poverty trap model and shows that we would expect to see asset smoothing not consumption smoothing in the neighborhood of critical asset levels at which optimal accumulation behavior bifurcates we then employ threshold estimation techniques to empirically confirm the co existence of consumption and asset smoothing regimes using a household panel data set from west africa households above the estimated threshold almost completely insulate their consumption from weather shocks whereas those below the threshold do not these results not only indirectly provide evidence of the existence of poverty traps but also speak to the level and incidence of the costs of uninsured risk

effects of conflict on agriculture evidence from the boko haram insurgency abstract we investigate the effects of conflict on agriculture using the boko haram insurgency as a case study we identify the output input infrastructure and human capital effects as direct effects and the loss of talent and other environmental factors as indirect effects identified market effects include effects on product and input prices and increased risk premiums by combining a nationally representative panel dataset on nigerian agriculture with armed conflict data we find that the increased intensity of boko haram attacks significantly reduces total output and productivity but not land use and reduces the outputs of specific staple crops such as sorghum cassava soya and yam conflict is also found to reduce the hours of hired labor for men and women but does not affect the use of family labor agricultural wages are however significantly affected because it reveals if why and how conflict affects agriculture this study has important implications for post crisis recovery and agricultural development

alcohol marketing adolescent drinking and publication bias in longitudinal studies a critical survey using meta analysis this paper presents a meta analysis of prospective cohort longitudinal studies of alcohol marketing and adolescent drinking which accounts for publication bias the paper provides a summary of 12 primary studies of the marketing drinking relationship each primary study surveyed a sample of youth to determine baseline drinking status and marketing exposure and re surveyed the youth to determine subsequent drinking outcomes logistic analyses provide estimates of the odds ratio for effects of baseline marketing variables on adolescent drinking at follow up using meta regression analysis two samples are examined in this paper 23 effect size estimates for drinking onset initiation and 40 estimates for other drinking behaviours frequency amount bingeing marketing variables include ads in mass media promotion portrayals brand recognition and subjective evaluations by survey respondents publication bias is assessed using funnel plots that account for missing studies bivariate regressions and multivariate meta regressions that account for primary study heterogeneity heteroskedasticity data dependencies publication bias and truncated samples the empirical results are consistent with publication bias omitted variable bias in some studies and lack of a genuine effect especially for mass media the paper also discusses dissemination bias in the use of research results by primary investigators and health policy interest groups

welfare effects of global patent protection this paper uses a simple model of invention and patent protection to examine the welfare effects of extending patent protection from the country where invention takes place to another country that is only a consumer of invented products it is shown that while the welfare of the inventing country certainly rises with the extension of patent protection that of the other country probably falls and may well fall by more than the increase in welfare of the inventing country in particular as patent protection is extended to a larger and larger portion of the world the effect on the welfare of the world as a whole of extending it to the rest of the world becomes negative

assassinations evaluating the effectiveness of an israeli counterterrorism policy using stock market data since the outbreak of the intifada in september 2000 the israeli government has extensively employed a policy of assassinating members of palestinian terrorist organizations theoretically the net effect of an assassination on future terrorism is indeterminate because it embodies two conflicting effects the assassination of a terrorist hurts his organization s capabilities but may increase the motivation for future attacks our indirect empirical evaluation of the effectiveness of assassinations for isreali counterterrorism is based on israeli stock market reactions to news of such operations we rely on the fact that terrorism has had significant adverse effects on the israeli economy and claim that the stock market should react positively to news about effective counterterrorism measures but negatively to news about counterproductive ones we find that the market does not react to assassinations of low ranked members of palestinian terrorist organizations the market does react strongly however to the assassinations of senior leaders of terrorist organizations it declines following assassinations targeting senior political leaders but rises following assassinations of senior military leaders to the extent that these reactions reflect expectations regarding future levels of terrorism they imply that the market perceives the first type of assassinations as counterproductive but the second as an effective measure in combating terrorism

endogenous research and development and intellectual property laws in developed and emerging economies author affiliation aniruddha bagchi abagchi kennesaw eduabhra roy aroy1 kennesaw edu acknowledgment this paper was presented at the international industrial organization conference may 2008 and we thank the conference participants we would also like to thank two anonymous referees who helped us in substantially improving the paper 1 introductionthere has been a recent literature summarized in maskus 2000 that analyzes the determinants of the intellectual property ip laws this article builds on this literature by examining the incentive of a country in providing ip protection when research and development r d effort is endogenously determined we analyze this incentive both for a developed economy and for an emerging economy it is natural to conjecture that in a two country model if one country improves its patent protection then the other country would free ride and reduce its own level of patent protection scotchmer 2004a p 330 this conjecture generally holds if r d effort is assumed to be exogenous however we show that if r d effort is endogenized then such a conclusion can hold only under certain circumstances indeed it is possible to show that there are situations under which an improvement in ip laws in the developed economy can lead to a simultaneous improvement of such laws in the emerging economy our analysis can therefore be used to determine conditions under which countries can free ride on each other in framing ip laws and conditions under which they cooperate interestingly in our model such cooperation can be achieved by countries acting in their best interest and not because of international treaties we also use our model to analyze conditions for convergence of ip laws between developed and emerging economies from the perspective of ip laws the most important differences between developed and emerging economies are that emerging economies have lower incomes and a lower level of research capability one can conjecture that if there is a convergence between the developed and emerging economies in both of these dimensions then there should be a convergence of their ip laws as well but in that case it is not clear if the convergence in ip laws is because of the convergence of incomes or because of the convergence of research capabilities however the role of each of these dimensions can be isolated if there is a convergence in only one of these dimensions to do so we focus on the impact on ip laws if there is convergence in incomes without a commensurate convergence in research capabilities 1 therefore in our framework the main difference between an emerging and a developed country is that the former has a domestic firm that engages in r d while the latter has a domestic firm that only imitates a new technology whenever possible while we agree that there are many points of difference between an emerging economy and a developed economy we focus on this difference since it seems to be the most relevant for the purpose of analyzing the different ip regimes that would emerge in equilibrium in either type of economy 2 further throughout the analysis ip laws refer to the choice of patent length and breadth in the model we analyze the solution to the following questions on the structure of ip laws i what is the relationship between the optimal patent length and the optimal patent breadth in a country given a fixed structure of ip laws in other countries in other words if a change in circumstances necessitates an improvement in the degree of patent protection in a particular country given a fixed degree of ip protection abroad how is this improvement achieved ii what is the relationship of the patent regimes across countries in other words if one country strengthens its patent laws should the other country s best response be to weaken its patent laws

is informal risk sharing less effective for the poor risk externalities and moral hazard in mutual insurance abstract poor farm households are less keen to adopt high risk high return technologies than rich households yet the poor are more vulnerable to income shocks we develop a model of endogenous risk taking to explain these facts in autarky poor households adopt less risky production plans and obtain lower expected returns but face higher relative risk than the rich the introduction of risk sharing generates negative risk externalities between agents at the first best the social planner imposes a homogeneous level of risk taking in the group at the second best risk taking is not enforceable and increases with insurance generating moral hazard interestingly the poor s risk taking behavior is more sensitive to insurance the social planner thus mitigates risk taking by applying a lower insurance coverage in poor groups the introduction of risk sharing therefore reinforces the gap between rich and poor in terms of expected income and absolute risk while the effect on relative risk is ambiguous

the displacement effect of reemployment bonus programs we develop a partial equilibrium matching model of the labor market in order to examine whether adoption of a reemployment bonus would displace workers not offered the bonus we examine the displacement effect for a unemployment insurance ui eligible workers who are offered but do not find a job in time to qualify for a bonus and b ui ineligible workers who are never offered a bonus the model predicts minimal displacement of the former group but for the latter group the model predicts an increase in unemployment duration of 2 4 week and an increase in unemployment of up to 2 per thousand

famine and household coping strategies abstract households faced with risks to their entitlement to food will plan strategically to minimize their impact the task of doing this will be particularly demanding during famines this paper reviews the evidence on household strategies for coping with famine in africa and identifies some distinctive patterns in these strategies which can be used to examine household objectives at times of crisis the management of resources to meet these objectives and limits to the effectiveness of coping strategies in particular it examines the role of asset management and trade offs between maintaining current food consumption levels and protecting the future income generating capacity of the household

optimal targeting under budget constraints in a humanitarian context the combination of conflict food insecurity and displacement generates competing claims for financial resources that stretch the donors ability to provide funding and the humanitarian organizations capacity to provide social assistance the paper uses receiver operating characteristic curves and related indexes to determine the optimal targeting strategy of a food voucher program for refugees the estimations focus on the 2014 food vouchers administered by the world food programme to syrian refugees in jordan the analysis uses data collected by the united nations high commissioner for refugees based on a poverty model receiver operating characteristic curves are used to optimize coverage and leakage rates under budget constraints the paper shows how policy makers can use these instruments to fine tune targeting using coverage rates budgets or poverty lines as guiding principles to increase the overall efficiency of a program as humanitarian organizations operate under increasing budget constraints and increasing demands for efficiency the proposed approach addresses both concerns

child health and conflict in cote d ivoire we examine the impact of the 2002 07 civil conflict in cote d ivoire on children s health status measured by height for age we use pre and post war survey data coupled with information on the location of violent incidents to capture exposure to the conflict of children born during 1997 2007 our results indicate that children from regions more affected by the conflict suffered significant health setbacks compared with children from less affected regions further household level victimization such as war related economic stress health stress and displacement has a large and negative effect on child health in conflict affected regions

heterogeneity of southern countries and southern intellectual property rights policy we develop a model with one innovating northern firm and heterogeneous southern firms that compete in a final product market we assume southern firms differ in their ability to adapt technology and study southern incentives to protect intellectual property rights we find that in a non cooperative equilibrium governments resist ipr protection but collectively southern countries benefit from some protection we show that in general countries with more efficient firms prefer higher collective ipr protection than those with less efficient firms given the aggregate level of ipr protection it is more efficient if the more efficient countries have weaker ipr protection les auteurs developpent un modele dans lequel coexistent une entreprise innovatrice du nord et des entreprises heterogenes du sud qui se concurrencent dans un marche de produit final on postule que les entreprises du sud different dans leur capacitea adopter la technologie et on etudie les differentes incitations au sud a proteger les droits de propriete intellectuelle dpi il appert que dans un equilibre sans cooperation les gouvernements resistent a la pression pour qu on protege les dpi mais que collectivement ils beneficient de cette protection on montre qu en general les pays dont les entreprises sont les plus efficaces supportent une protection collective des dpi plus robuste que ne le font les pays dont les entreprises sont moins efficaces le niveau general de protection des dpi etant donne c est plus effectif si les pays les plus efficaces ont des niveaux de protection des dpi plus faibles

is consumption insured against illness evidence on vulnerability of households to health shocks in rural ethiopia abstract low and volatile incomes and absence of well developed financial markets make consumption smoothing an important issue in low income countries based on the theory of full insurance and using 2 years of panel data this study examines the impact of illness on the consumption of rural households and the capacity of existing risk sharing mechanisms in insuring consumption against health shocks in the rural areas of ethiopia the results show that illness has a statistically significant negative impact on the stability of consumption and the capacity of households or existing intra and interhousehold risk sharing arrangements in insuring consumption against illness varies across different consumption items the regression results show that the hypothesis of consumption insurance cannot be rejected in the case of total food consumption implying that basic items that come from own production and from external sources gifts are better insured and insensitive to the illness of the head however the

the north s intellectual property rights standard for the south abstract we build a multi sectoral north south trade model to analyze international intellectual property rights ipr protection by comparing the nash equilibrium ipr protection standard of the south the developing countries with that of the north the developed countries we find that the former is naturally weaker than the latter moreover we show that both regions can gain from an agreement that requires the south to harmonize its ipr standards with those of the north and the north to liberalize its traditional goods market this demonstrates the merits of multi sectoral negotiations in the gatt wto

income and livelihoods in the war in afghanistan we explore the impact of the insurgency and military deployment on the livelihoods of local communities in afghanistan we use monthly wages and commodity prices at the provincial level over the period 2003 09 and look for their response to conflict events and isaf deployment overall we find that prices are more sensitive to deployment than to attacks commodity prices are not significantly affected by insurgent violence which is consistent with coping strategies already in place on the opposite military deployment is associated with an increase in the levels of wages and commodity prices as isaf is a new source of uncertainty

using weather variability to estimate the response of savings to transitory income in thailand this paper measures the extent to which farmers are able to use savings and dissavings to smooth consumption in response to unexpected shocks to income time series information on regional rainfall is used to construct estimates of transitory income due to rainfall shocks the relationship between these measures of transitory income and savings indicates that farm households save a significantly higher fraction of transitory income than nontransitory income jel d91 016 the incomes of farm households in developing countries are notorious for being both low and uncertain policies that increase the incomes of farmers may well be different

an assessment of causal inference in smoking initiation research and a framework for future research i introduction the causal factors underlying youth smoking initiation are central to the challenge of developing effective smoking prevention programs and the shaping of many other types of smoking related policies these causal factors specifically the ones that potentially may be influenced by the conduct of cigarette manufacturers also have been a central issue in much of the recent smoking related litigation these high profile legal cases have focused on the claim that tobacco company conduct significantly influenced youth smoking initiation rates in particular cigarette advertising and tobacco company public reluctance to acknowledge the health risks of smoking have been purported to be key factors influencing youth smoking decisions 1 in this paper we examine the basic principles of empirical scientific investigation that have been adopted to establish causal relationships and apply these principles to evaluate the evidence underlying the link between cigarette advertising and youth smoking initiation the causal link between tobacco company marketing and youth smoking generally has been accepted as empirically established outside the economics literature despite the fact that the underlying evidence fails to meet commonly applied econometric standards we review some of these papers in the public health literature that have been cited as evidence supporting the causal link between cigarette advertising and youth smoking and explain why these papers fail to support this causal link further we also review the economics literature that provides evidence for a multicausal model for youth risky behaviors including smoking we identify studies in which researchers have found that many characteristics affecting choices to participate in risky behaviors are formed at very early ages empirical demonstration of causation is fundamental to guiding effective development of interventions in many areas of social life scientific principles are especially important for developing smoking related policies as enormous resources currently are being devoted to develop programs that attempt to reduce youth smoking propensities however many of these policies and suggested policies focus on causal factors that have not been scientifically established but rather merely assumed to affect smoking initiation more effective policies potentially could be developed by distinguishing causal factors through more reliable empirical methodologies without identifying factors that lead to smoking initiation through sound estimation techniques current prevention efforts may turn out to have little or muted benefits 2 ii causal factors of smoking initiation and the scientific model an important goal of policy analysis is to identify and measure causal relationships as many confounding correlations exist which do not reflect structural relations underlying actual outcomes understanding these underlying structural relations allows empirical versions of estimated models to more accurately forecast the effects of interventions as is well recognized in the econometrics literature precise identification and measurement of causal effects is a difficult task in the area of human choice since input parameters of investigated relationships may reflect unobserved individual characteristics and choices thus correlations between endogenous input parameters and observed outcomes may simply represent individual sorting on latent characteristics rather than structural relations between input and output variables many times in other disciplines biases associated with endogeneity do not hinder estimation of structural models because observed variables are not affected by individual choice for example to evaluate the effect of a particular drug on a particular disease researchers may be able to perfectly control factors such as the presence of other diseases dosage regimens alternative drug usage and diet

forced displacement and technology adoption an empirical analysis based on agricultural households in bosnia and herzegovina we use the bosnian living standards measurement study lsms survey to show that conflict induced displacement of agricultural households dramatically affects the adoption of new technologies in agriculture we exploit the heterogeneity in the level of violence in the pre war location to account for selection bias this natural experiment seems to be a source of exogenous variation in our case because violence aims at ethnic cleansing without economic consideration we find that the displaced are less likely than stayers to adopt fertiliser and pesticide

displacement due to violence in colombia a household level analysis abstract civil wars and ethnic conflicts have resulted in an estimated number of approximately 35 million refugees and internally displaced persons worldwide understanding the determinants of forced migration is an important prerequisite for the definition of appropriate policies of prevention assistance and relocation we develop a conceptual framework for the empirical analysis of displacement decisions at the household level while similarities to conventional migration theories exist there are also important differences implied by the presence of violent conflict for example risk aversion and lack of information may hamper conventional migration but enhance displacement factors such as landholdings and social capital at the place of origin may not only reduce displacement in the conventional sense of raising opportunity costs but may also spur displacement indirectly by increasing the household s likelihood of becoming the victim of direct threats for the case of colombia we conduct an econom

the duration of the smoking habit i introduction most smokers smoke out of habit once the habit is ended many of smoking s most harmful effects decline rather quickly preventing and ending cigarette addiction is therefore the straightest path toward preventing the health damage done by cigarette smoking consequently the related questions of why people start smoking and why they quit are central to formulating and evaluating effective antismoking policies duration or hazard models are designed to measure the probability of transition between states and are thus ideal for investigating the structural determinants of the transition between addiction and non addiction nevertheless most previous work in the economics literature uses the aggregate smoking participation rate defined as the percentage of people who currently smoke or an individual s probability of participation rather than a hazard rate to measure the attractiveness of habitual smoking this paper models the hazard rates of both starting and quitting the cigarette smoking habit the starting hazard rate is the probability that an individual will start smoking in a given time period conditional on being a nonsmoker until then the quitting hazard rate is the probability of quitting smoking in a given time period conditional on being a smoker since the starting date both of these rates should rise and fall in response to changes in the attractiveness of smoking the two rates will respond differently to different stimuli since the starting hazard reflects the point of view of nonsmokers and the quitting hazard reflects the point of view of smokers hazard or duration models possess several advantages over smoking participation models most obviously smoking participation rates cannot directly distinguish between increased starting rates and decreased quitting rates but the hazard models can also in a participation rate model it is difficult to control for the effect of the duration of the habit whereas duration models are designed specifically to allow for and measure the dependence of the hazard rate on duration another advantage is that the participation rate at any one time will oversample the number of long term smokers relative to those who had a short term habit whereas a duration model is designed to avoid this source of bias one drawback however is that because of their inherent panel nature the data requirements of duration models are somewhat more difficult to satisfy as shall be seen the only previous work in the economics literature that estimates the hazard rate of starting smoking is douglas and hariharan 1994 my paper improves upon douglas and hariharan in at least three important ways first it estimates the hazard rate of quitting smoking as well as that of starting second it takes into account variation in state level regulation third its time varying covariate model allows hazard rates to respond dynamically to changes in cigarette price regulation and information variables the use of time varying covariates is important because it brings the empirical model into much closer accord with theory the decision whether or not to start or quit smoking is an ongoing decision made one day at a time on the basis of current information the hazard of starting is greatest when the cost of the habit appears lowest and its benefit appears highest this comparison of cost and benefit changes through time as price information income and life cycle variables change while douglas and hariharan 1994 used price information from the potential smoker s most vulnerable age on the theory that its marginal effect is greatest at that time the model used in this paper allows each individual s hazard rate to respond to changes in price and public information as they occur the leading theoretical model of the decision to smoke is the rational addiction model of becker and murphy 1988 which assumes that consumers of addictive goods begin smoking only after fully weighing the costs and benefits of the habit

shocks and asset dynamics in ethiopia abstractthis article uses household survey panel data of 416 rural households to study asset dynamics in the northern highlands of ethiopia and the response of assets to shocks the period under examination 1996 2003 was marked by severe environmental shocks including a series of droughts the article empirically studies the nature of household asset paths over time using as the point of departure the theory on precautionary savings behavior results indicate that the response of assets to weather shocks the differential effect of these shocks on liquid and less liquid forms of wealth holdings and the nature of asset dynamics are all consistent with the implications of a precautionary motive for holding wealth

asset market perspectives on the israeli palestinian conflict this paper locates turning points in the israeli palestinian conflict since the late 1980s using asset market data from israel and the palestinian authority pa we find that major escalations in violence such as the outbreak of the intifada in 2000 lead to significant declines in asset prices in both israel and the pa conversely major peace initiatives such as the oslo accords in 1993 and the road map plan in 2003 lead to substantial increases in asset prices on both sides of the conflict an additional novel finding is that asset markets respond positively to the success of politicians who favour a negotiated settlement to the conflict

international protection of intellectual property we study the incentives that governments have to protect intellectual property in a trading world economy we consider a world economy with ongoing innovation in two countries that differ in market size and in their capacities for innovation after describing the determination of national patent policies in a non cooperative regime of patent protection we ask why is intellectual property better protected in the north than in the south we also study international patent agreements by deriving the properties of an efficient global regime of patent protection and asking whether harmonization of patent policies is necessary or sufficient for global efficiency jel o34 f13 during the 1980 s and early 1990 s the united states and several european countries expressed strong dissatisfaction with what they deemed to be inadequate protection of intellectual property in many developing countries the developed countries made the upgrading of intellectual property rights iprs one of their highest priorities for the uruguay round of trade talks their efforts bore fruit in the agreement on traderelated aspects of intellectual property rights trips which was approved as part of the final act of the uruguay round trips establishes minimum standards of protection for several categories of intellectual property for example in the area of new technology it essentially harmonizes

monotone comparative statics under uncertainty this paper analyzes monotone comparative statics predictions in several classes of stochastic optimization problems the main results characterize necessary and sufficient conditions for comparative statics predictions to hold based on properties of primitive functions that is utility functions and probability distributions the results apply when the primitives satisfy one of the following two properties i a single crossing property which arises in applications such as portfolio investment problems and auctions or ii log supermodularity which arises in the analysis of demand functions affiliated random variables stochastic orders and orders over risk aversion

diamonds are forever wars are not is conflict bad for private firms this paper studies the relationship between civil war and the value of firms in a poor resource abundant country using microeconomic data for angola we focus on diamond mining firms and conduct an event study on the sudden end of the conflict marked by the death of the rebel movement leader in 2002 we find that the stock market perceived this event as bad news rather than good news for companies holding concessions in angola as their abnormal returns declined by 4 percentage points the event had no effect on a control portfolio of otherwise similar diamond mining companies this finding is corroborated by other events and by the adoption of alternative methodologies we interpret our findings in light of conflict generated entry barriers government bargaining power and transparency in the licensing process jel d74 g32 o13 o17 q34

civil war crop failure and child stunting in rwanda economic shocks at birth have lasting effects on children s health several years after the shock the authors calculate height for age z scores for children under age five using data from a rwandan nationally representative household survey conducted in 1992 they exploit district and time variation in crop failure and civil conflict to measure the impact of exogenous shocks that children experience at birth on their height several years later they find that boys and girls born after the shock in regions experiencing civil conflict are both negatively affected with height for age z scores 0 30 and 0 72 standard deviations lower respectively conversely only girls are negatively affected by crop failure with these girls exhibiting 0 41 standard deviation lower height for age z scores and the impact is worse for girls in poor households results are robust to using sibling difference estimators household level production and rainfall shocks as alternative measures of crop failure

precautionary saving in the small and in the large the theory of precautionary saving is shown to be isomorphic to the arrow pratt theory of risk aversion making possible the application of a large body of knowledge about risk aversion to precautionary saving and more generally to the theory of optimal choice under risk in particular a measure of the strength of the precautionary saving motive analogous to the arrow pratt measure of risk aversion is used to establish a number of new propositions about precautionary saving and to give a new interpretation of the dreze modigliani substitution effect copyright 1990 by the econometric society

patent protection southern innovation and welfare in a north south trade model in a north south trade model we analyse the implications of southern patent protection on southern innovation profits and welfare southern patent protection may make the northern firm worse off and the southern firm better off by increasing the southern firm s incentive for innovation and affecting the nature of competition in the world market the impact of southern patent protection on a country s welfare and on world welfare depends on the cost of southern innovation and the degree of product substitutability we provide important insights into the outcomes of international negotiations regarding patent enforcement in the southern countries