general equilibrium with price intervention policies a computational approach abstract three alternative formulations of general equilibrium under price intervention policies are presented in a computational framework in the first minimum or ceiling prices are supported by a government marketing agency revenues are recycled to consumers in the minimum price case and losses covered by lump sum taxes in the ceiling case similarities to general equilibrium with taxes are stressed in the second sector specific minimum prices are considered similar to harris todaro equilibria in the third government price supports operate through market interventions existence is discussed numerical examples presented and possible policy applications outlined

the effect of time pressure on consumer choice deferral this article investigates the effect of time pressure on choice deferrai recent research suggests that the likelihood of deferral is contingent on the ease of making the selection decision which option to choose as well as the overali attractiveness of the selected alternative we focus on how time pressure systematically impacts choice deferral by increasing the use of noncompensato ry decision rules in the selection decision and by increasing the relative emphasis placed on the unique features in the deferral decision whether to choose consistent with the hypotheses we find over a series of five studies that time pressure 1 decreases choice deferral when choice involves high conflict but not when conflict is low 2 reduces the impact of shared features on choice deferral and 3 decreases choice deferral for sets with common bad and unique good features approach approach conflict but not for sets with common good and unique bad features avoidance avoidance conflict we further show that greater attention to the unique features is not a general property of decision making under time pressure but rather a consequence of the primacy of the selection decision over the deferral decision consistent with this premise time pressure did not decrease the relative attention paid to common features when the task was described as purely a deferral decision the theoretical and practical implications of the findings are discussed

markets under price controls in partial and general equilibrium abstract when parallel markets arise in the face of price or other controls two aspects of agents behavior become crucial in analyzing market outcomes first sellers risk will rise with increases in illegal sales but may also fall with increases in legal sales if the latter is true the parallel market price will induce higher output second if consumers can be given access to the price controlled good without incurring search queuing and other transaction costs due to rationing production of the controlled good will be higher these effects are demonstrated in both partial and general equilibrium

a measurement error approach for modeling consumer risk preference von neumann morgenstern vn m utility theory is the dominant theoretical model of risk preference recently market researchers have adapted vn m theory to model consumer risk preference but most applications assess utility functions by asking just n questions to specify n parameters however any questioning format especially under market research conditions introduces measurement error this paper explores the implications of measurement error on the estimation of the unknown parameters in vn m utility functions and provides procedures to deal with measurement error we assume that the functional form of the utility function but not its parameters can be determined a priori through qualitative questioning we then model measurement error as if question format and other influences cause the consumer to choose the unknown risk parameter from a probability distribution and to make his decisions accordingly we provide procedures to estimate the unknown parameters when the measurement error is eith

consumer preference for a no choice option the traditional focus in the decision making literature has been on understanding how consumers choose among a given set of alternatives the notion that preference uncertainty may lead to choice deferral when no single alternative has a decisive advantage is tested in seven studies building on recent research the article shows that the decision to defer choice is influenced by the absolute difference in attractiveness among the alternatives provided and is not consistent with trade off difficulty or the theory of search these findings are then extended to show that choice deferral can also be modified for the same alternatives by manipulations that make them appear more similar in attractiveness or that decrease the need to differentiate among them the results are consistent with the notion that preference uncertainty results in a hesitation to commit to any single action since small differences in attractiveness among the alternatives are potentially reversible consistent with this premise the effect of attractiveness difference on choice deferral decreased significantly when subjects were first allowed to practice making monetary trade offs among the available alternatives

reform in eastern europe a general equilibrium model with distortions in relative prices and factor markets this paper presents an analysis of reforms using a simple general equilibrium model with production the model illustrates some of the distortions remaining in the eastern european countries as they adopt market oriented policies and it shows that price reforms should take priority if simultaneous reform is not possible specifically the authors examine reforms of relative prices of output goods and liberalization of the capital market the model is solved numerically showing that restrictions on capital mobility should be retained until after price distortions have been removed

general equilibrium analysis of black and white markets a computational approach abstract this paper explores the inter relationship between black and white markets and presents a formulation in which equilibrium conditions hold separately for each type of market for each product with linking conditions across market types using a traditional goods and factor general equilibrium model the simultaneous operation of price controls on white markets and surveillance with penalties for those caught trading on black markets is modelled a numerical example of such an economy is presented using data for india and equilibria under coexistence are reported

a computational general equilibrium model with endogenous unemployment an analysis of the 1980 fiscal reform in mexico abstract in this paper we develop a general equilibrium model of the mexican economy in which unemployment and government deficits play important roles the unemployment rate depends on a downwardly rigid real wage in the urban sector the government runs a deficit simply by selling bonds that consumers consider perfect substitutes for physical capital as savings instruments the model is used to analyze the impact of the 1980 fiscal reform the presence of the rigid real wage and alternative specifications of government policies regarding the size of the deficit are found to have significant effects on the comparative statics results whether or not the reform improves the welfare of rural households compared to urban households for example depends on whether government policy is to keep the deficit constant or keep expenditures constant in response to changes in tax revenues

complexity effects in choice experiment based models abstract many firms rely on choice experiment based models to evaluate future marketing actions under various market conditions this research investigates choice complexity i e number of alternatives number of attributes and utility similarity between the most attractive alternatives and individual differences in decision time as key factors that affect the predictive performance of models based on choice experiments both within and between complexity conditions the results show that complexity and individual decision time not only affect the error in consumer choice models but also consumers decision strategy and systematic utilities the authors introduce a complexity adjusted mixed logit cam logit model to capture the various influences of complexity in choice experiment based models they illustrate the consequences of complexity on choice behavior with market share predictions of the cam logit model for different complexity conditions

the effect of local consideration sets on global choice between lower price and higher quality a set of alternatives under consideration is often divided into subsets or local sets by some external e g product display format at the store or internal e g a decision rule factor we propose that the manner in which a global set of alternatives varying in price and quality is divided into local sets can have a systematic effect on consumer choice between a lower price alternative and a higher quality alternative three such effects are investigated 1 consumers who first choose from pairs of products a b b c a c and then choose from the set of all three products a b c are more likely to prefer the cheapest alternative than consumers who only choose from the complete set 2 the choice share of a low price low quality brand is greater when alternatives varying in price quality and features are displayed by brand i e each display presents different models of one brand as compared to a display by feature level i e each display presents comparable models of different brands and 3 consumers considering a pair of two option local sets each consisting of different brands and feature levels e g a feature enhanced model of a low quality brand vs a basic model of a high quality brand are more likely to select a feature enhanced model from the global set of four options than those who consider the same alternatives in other local set configurations or consider only the global set these predictions were supported in seven studies which also provided insights into the boundaries of the effects focusing on the paired comparison effect we discuss the theoretical and practical implications of the findings

general equilibrium analysis of price controls a computational approach this paper presents a computational general equilibrium framework for evaluating the welfare costs associated with economy wide price controls other than traditional commodity specific partial equilibrium analyses most empirical literature on price controls concentrates on macroeconomic issues such as the impact on inflation and unemployment here we seek to reorient empirical literature on the effects of these controls towards efficiency losses from resource misallocation by providing a framework which can be used to address the issue of how large these economic inefficiencies are and who gains and who loses from them in this paper we present a general equilibrium computational framework for evaluating the welfare costs associated with economy wide price controls price controls have been employed by governments all over the world during war and peace in response to all manners of threats both real and imaginary and in all ages 2 other than traditional commodity specific partial equilibrium analyses most empirical literature on price controls concentrates on macroeconomic issues such as the impact on inflation and unemployment despite the fact that the main attack on price controls is usually in terms of their efficiency losses from resource misallocation here we seek to reorient the empirical literature on the effects of the controls by providing a framework which can be used to address the issue of how large these economic inefficiencies are and who gains and who loses from them we use a general equilibrium model in which the equilibrium mechanism in the presence of price controls is endogenously determined search costs these yield additional welfare losses under price controls beyond those associated with more traditional tax or tariff models the argument is that in an economy with price controls the greater the difference between controlled and market clearing prices the costlier it is for buyers and sellers to find each other and transact a similar approach has been taken recently in two other papers in which we have been involved see nguyen 1985 nguyen and whalley 1986 the difference here is that unlike these earlier papers we explicitly incorporate production and apply our approach to the issue of economy wide controls using data for an actual economy since either the buying or selling side of a price controlled market can be

the influence of serotonin deficiency on choice deferral and the compromise effect abstractpsychological and physiological states such as mood hunger stress and sleep deprivation are known to affect decision making processes and therefore crucially influence consumer behavior a possible biological mechanism underlying the observed variability of consumer behavior is the context sensitive variation in the levels of neuromodulators in the brain in a series of four experimental studies the authors pharmaceutically reduce the levels of the neurotransmitter serotonin in the brain to diminish the availability of subjects cognitive resources in doing so they study how serotonin brain levels influence 1 subjects tendency to avoid buying and 2 consumers preference for product options positioned as a compromise in a given choice set rather than for more extreme alternatives i e the compromise effect using realistic product choice scenarios in a binding decision framework they find that a reduction of brain serotonin levels leads to choice deferral and decreases the compromise

search costs and adaptive consumers short time delays do not affect choice quality using online price comparison and shopping platforms makes experiencing slow connections lags and waiting times for information an unfortunate reality however little attention has been paid to analyzing the effects of such delayed display of information on product choice behavior this article explores the effect of time delays in a multi attribute choice laboratory experiment by not providing information immediately when requested but after short time delays increasing these waiting times reduced the amount of information looked up but did not affect choice quality higher time delays made decision makers use more deliberate search processes whereas low time delays induced inefficient over searching

stock market efficiency in thin trading markets the case of the vietnamese stock market this article reviews developments in the stock trading centre stc in ho chi minh city vietnam the main stock market in the country since its start in 2000 it presents information about developments in the number of stocks traded trading activity and stock price developments this article focuses on the question whether the market is weak form efficient an important element of the investigation concerns the possible bias of the results caused by the thin trading that characterizes the stc stock market returns are corrected for this the main conclusion is that the stc is not efficient in the weak form

the behaviour of hong kong stock prices the primary function of a stock market is to allocate resources to the most profitable investment opportunities if stock prices provide accurate signals for resource allocation firms are able to make correct production investment decisions and investors are able to choose the most suitable stocks for investment these choices are only possible if the market is efficient that is if stock prices fully reflect all available information hong kong is now an international financial centre although hong kong s stock market is ranked as one of the five largest in the world in terms of turnover little research has been devoted to the behaviour of its stock prices this is a study of the efficiency of hong kong s stock market it is based upon two widely accepted statistical tests namely serial correlation analysis and runs tests data used cover the daily prices of 28 major hong kong stocks over a period of four years from 1977 to 1980 the evidence is mixed it does not provide clear support for the e

retrospectives the origins of the representative agent this paper examines alfred marshall s invention of the representative firm marshall first used the representative firm in order to describe an industry supply curve for an industry with heterogeneous firms despite marshall s limited use of the notion the representative agent was extensively criticized as an ephemeral useless construct that was unable to account for economic growth and that ignored important heterogeneities the criticisms succeeded in banishing the representative agent from economics these initial criticisms are also shown to apply to modern uses of the representative agent as well

time for revisionism on rent control economists traditional hostility to rent contols is based on models that treat the housing market as perfectly competitive and on the experience with hard controls in new york city and many european countries following world war ii the current soft rent control systems in north america are varied and qualitatively different from earlier hard controls the theoretical case against them is weak particularly when the housing market is viewed as imperfectly competitive the empirical case against them is weak too economists should reconsider their blanket opposition to current rent control systems and evaluate them on a case by case basis

equilibrium under price controls with endogenous transactions costs abstract in this paper we present an equilibrium model for an exchange economy with fixed prices and endogenously determined search or transactions costs given the fixed prices endogenously determined equilibrium buying and selling prices which include transactions costs result these costs occur on either the demand or supply side of each market but not both we see an eventual application of this approach to an evaluation of welfare costs of either economy wide wage and price controls or sector specific price controls such as energy in the final section we present some simple numerical examples which illustrate the approach

impact of state and civil institutions on the operation of rural market and nonmarket configurations abstract the approach undertaken in this study is based on the concept of configurations configurations are shaped by specific combinations of characteristics of the following elements the item transacted the actors and the underlying physical technological cultural and policy environment configurations can be either market or nonmarket configurations in turn transactions are endogenously determined within given configurations the impact of government intervention on the performance of a number of prototypical rural configurations and agrarian institutions such as the food and cash crops market configurations the farm household sharecropping and the rural official and unofficial credit markets is evaluated critically

the parallel market of illegal aliens a computational approach abstract this paper develops the notion of illegal aliens as a parallel market in coexistence with the regular market of legal labor in the presence of both price controls on legal labor by minimum wage legislation and quantity controls on illegal aliens by immigration laws illegal aliens involve not only rural urban migration but also tax evasion and deportation costs we develop an analytical equilibrium structure which links markets for legal labor and illegal aliens illustrate how much an equilibrium can be computed and explore some implications of the linkage using united states data

optimal conflict in preference assessment conflict arises indecision making when the choice alternatives present strong advantages and disadvantages over one another that is when the trade offs involved are large conflict affects human response to choice in particular it increases decision difficulty and response unreliability on the other hand larger trade offs i e higher conflict reveal more information about an individual s preferences and mitigate the influence of measurement unreliability on preference model estimation this suggests somewhat counterintuitively that there may exist some optimal level of conflict for efficient measurement of preferences how to determine this level this issue is examined from behavioral and analytical angles we outline a general analysis of the interaction between trade off size and modeling accuracy and demonstrate its application on a simple example the kind of analysis developed here can be conveniently implemented in a computer spreadsheet and would be especially valuable when large amounts of preference data are to be collected as in consumer preference studies experimental research and contingent valuation surveys