design and analysis of simulated consumer choice or allocation experiments an approach based on aggregate data the authors integrate concepts in conjoint analysis and discrete choice theory in econometrics to develop a new approach to the design and analysis of controlled consumer choice or resource allocat

an aggregate model of technical change a simple aggregate growth model is presented in which technology is described by a probability distribution from which new plants are drawn especially good draws are viewed as technological innovations that shift the mean of the following period s plant distribution function the resulting technical change is endogenous random and cumulative in contrast to conventional growth models the model s growth path displays nonstationary drift rather than deterministic trend and the long run per capita growth rate has positive rather than zero sensitivity to the model s saving parameter

consumer valuation of health attributes for soy based food a choice modeling approach abstract given that soy foods possess health promoting attributes that offer the promise of reducing heart related chronic diseases this article employs choice experiments to estimate marginal willingness to pay wtp for soy attributes including taste contents of soy protein and health claim random parameter logit rpl models were estimated in consideration of potential heterogeneity across individuals in their preferences for soy food standard deviation parameters in the rpl models are highly significant indicating that individuals have widely varying preferences for soy based food products results suggest that while taste is the dominating attribute that drives consumers wtp for soy food products consumers do respond to the information provided in the health claim yet consumers do not seem to be recognizing soy protein as the link to health benefits of soy foods

the effect of business cycles on growth keynes vs schumpeter i introduction do business cycles matter the question would have seemed recherche a scant decade ago when understanding and explaining business cycle phenomena were the bread and butter of macroeconomics but recently with the revival of interest in growth theory it has become customary to argue that business cycles are an unimportant second order problem the locus classicus for this position is lucas 1987 a particularly sharp statement of it launches the recent growth textbook by barro and sala i martin 1995 4 5 if we want to understand why countries differ dramatically in standards of living then we have to understand why countries experience such sharp divergences in long term growth rates even small differences in these growth rates when accumulated over a generation or more have much greater consequences for standards of living than the kind of short term business fluctuations that have typically occupied the attention of macro economists to put it another way if we can learn about government policy options that have even small effects on the long term growth rate then we can contribute much more to improvements in standards of living than has been provided by the entire history of macroeconomic analysis of countercyclical policy and fine tuning certainly there is a superficial ring of truth to this assertion since one s standard of living today is obviously higher in a rich country in a recession than in a poor country in a boom however to infer from this that business cycles are unimportant one needs to assume additionally a dichotomy between business cycles and growth so that explaining why economies grow and why they experience fluctuations are treated as analytically distinct questions 1 if the dichotomy is granted then the conclusion follows because a policy of eliminating business cycle fluctuations would have no effect on the growth rate and so would confer a smaller welfare benefit over a long time horizon than a small increase in the growth rate over that same horizon but in our view this is a false dichotomy we believe that business cycles can affect growth granted this are business cycles good or bad for growth much of the emerging literature seems to suggest that recessions are good for growth if correct this would seem to make countercyclical stabilization policy not just unimportant but positively harmful caballero and hammour 1994a b present models in which recessions are viewed as times of cleansing or a pit stop for the economy so that recessions are good for growth aghion and saint paul 1991 argue in the same vein at first glance these models would seem to suggest that recessions and therefore business cycles are good for growth but on closer inspection there are two analytically distinct questions i are recessions good for growth and ii are business cycles good for growth suppose one accepts the caballero hammour argument that recessions are good for growth pari passu it should follow symmetrically that booms are bad for growth so that the net effect of a business cycle washes out to a first order of approximation so that a fortiori a successful countercyclical policy which eliminated business cycles would have no first order effect on growth conlisk 1989 by contrast presents a model which focuses specifically on the second question one of the few such papers of which we are aware his model is a neo schumpeterian evolutionary growth model which predicts that business cycles will be good for growth because of greater opportunities for innovation we disagree with these conclusions a more severe business cycle leads to increased uncertainty for firms which we think ought to reduce the return to capital and hence reduce the incentive to invest this should lead to reduced capital accumulation and therefore to slower growth along the transitional path and also to a smaller steady state capital labour ratio in a neoclassical growth model or lead to a slower overall growth rate in an endogenous growth model

demand for beef from cattle administered growth hormones or fed genetically modified corn a comparison of consumers in france germany the united kingdom and the united states we compare consumer valuations of beef ribeye steaks from cattle produced without growth hormones or genetically modified corn in france germany the united kingdom and the united states results suggest that french consumers place a higher value on beef from cattle that have not been administered added growth hormones than u s consumers however valuations of non hormone treated beef are statistically indistinguishable across germany the united kingdom and the united states results also suggest that european consumers place a much higher value on beef from cattle that have not been fed genetically modified corn than u s consumers copyright 2003 oxford university press

are choice experiments incentive compatible a test with quality differentiated beef steaks this study compares hypothetical and nonhypothetical responses to choice experiment questions we test for hypothetical bias in a choice experiment involving beef ribeye steaks with differing quality attributes in general hypothetical responses predicted higher probabilities of purchasing beef steaks than nonhypothetical responses thus hypothetical choices overestimate total willingness to pay for beef steaks however marginal willingness to pay for a change in steak quality is in general not statistically different across hypothetical and actual payment settings

opportunities incentives and the collective patterns of technological change in a few pages in the introductory article for this debate vernon ruttan succeeds in the unlikely task of flagging many issues at the core of the economic interpretation of technological change and by doing so he implicitly addresses also a few sensitive spots for the economic discipline at large here i will not attempt to provide any thorough view of what i consider the achievements and limitations of the current state of the art see however freeman i 994 for a critical survey which i largely share rather i shall put forward a series of remarks which hopefully could be seen as part of a much wider and still largely unexplored research programme as a premise just note that some form of attention to technology related phenomena has spread over the last 20 30 years from small enclaves of heterodox economists and economic historians to become an important concern even for quite mainstream theories of e g the firm industrial organisation macroeconomics trade growth etc from patent races all the way to new trade and new growth theories and even real business cycle macro models technical change has drawn a consideration which is less by default than it was say in robert solow s original growth models orjoe bain s barriers to entry views on industrial structures and in parallel empirical studies at the levels of specific technologies firms sectors and countries have boomed for overviews cf dosi i988 nelson i993 freeman i982 i 994 cohen i 995 and granstrand i 994 among others so at least in this sense those decreasing returns to the economics of technical change suggested by ruttan do not seem to have set in however ruttan s paper raises also substantive questions about the relative success of three interpretative perspectives which he calls induced evolutionary and path dependent in the following i shall argue that an evolutionary perspective broadly defined can easily accommodate both inducement effects and path dependent patterns of technical change let me start from what i consider the major building blocks of an

the dynamic effects of aggregate demand and supply disturbances we interpret fluctuations in gnp and unemployment as due to two types of disturbances disturbances that have a permanent effect on output and disturbances that do not we interpret the first as supply disturbances the second as demand disturbances demand disturbances have a hump shaped mirror image effect on output and unemployment the effect of supply disturbances on output increases steadily over time peaking after two years and reaching a plateau after five years

contract farming configuration smallholders preferences for contract design attributes while contract farming cf can enhance smallholders income in developing countries empirical research on the motivation of smallholders to participate in cf is scarce this paper explores farmer preferences for particular contract design attributes we combined analytical hierarchy process and discrete choice experiments to investigate the importance of contract design attributes on the basis of data collected among potato farmers in ethiopia we found that input market uncertainty is more important than output market uncertainty in smallholders decision to participate farmers tend to minimize their risk by opting for the buyer firm above the state and ngos as providers of seed inputs and technical assistance the results imply that the success of a cf scheme depends on the willingness of the firm to incorporate the preferred contract design attributes institutional intervention in the input market could induce agribusiness firms to offer attractive contracts for smallholders

dynamic oligopoly in the rice export market a linear quadratic dynamic oligopoly model is used to estimate the competitiveness of the rice export market the model nests various market structures using either open loop or feedback strategies the estimated feedback model implies a less competitive market structure than the estimated open loop model the rice export market is oligopolistic but it is closer to competitive than collusive copyright 1989 by mit press

do hypothetical and actual marginal willingness to pay differ in choice experiments application to the valuation of the environment abstract in this paper we test the validity of choice experiments with donations for environmental projects in particular we test whether or not there are differences in preferences between a hypothetical and an actual choice experiment our experiments indicate no differences in addition internal tests of validity indicate transitive and stable preferences in both experiments although there are some indications of possible learning effects during the experiment

post uruguay round price linkages between developed and developing countries the case of rice and wheat markets the uruguay round agreement on agriculture attempted to lower distortions in global agricultural markets however the significant fall in commodity prices in the late 1990s may have reduced the incentives for both developed and developing countries to better integrate into world markets this study analyzes price linkages and adjustment between developed and developing countries during the post uruguay round period prices of two key commodities long grain rice and medium hard wheat are assembled for major exporters and producers results of multivariate cointegration analysis suggest partial market integration between developed and developing countries in the post uruguay round period developed countries are found to be price leaders in these two markets and in most cases changes in their prices have relatively large impacts on those of the developing countries developing countries e g vietnam and argentina have faced considerable price adjustment due to changes in the developed countries prices

an incentive compatible conjoint ranking mechanism a simple method for making ranking based conjoint analysis incentive compatible is proposed the incentive compatible mechanism involves people purchasing a product profile with a probability proportional to its assigned rank in an empirical application related to consumer preferences for beef attributes we find that the forecasted market share for a new pasture raised steak obtained using incentive compatible rankings was significantly greater than that implied from traditional hypothetical conjoint rankings people s rankings of ground beef products were not affected by the mechanism or by information about pasture raised beef copyright 2008 oxford university press

using choice experiments to value the environment this paper we outline the choice experiment approach to environmental valuation this approach has its roots in lancaster s characteristics theory of value in random utility theory and in experimental design we show how marginal values for the attributes of environmental assets such as forests and rivers can be estimated from pair wise choices as well as the value of the environmental asset as a whole these choice pairs are designed so as to allow efficient statistical estimation of the underlying utility function and to minimise required sample size choice experiments have important advantages over other environmental valuation methods such as contingent valuation and travel cost type models although many design issues remain unresolved applications to environmental issues have so far been relatively limited we illustrate the use of choice experiments with reference to a recent uk study on public preferences for alternative forest landscapes this study allows us to perform a convergent validity test on the choice experiment estimates of willingness to pay

on consumers willingness to purchase nutritionally enhanced genetically modified food this study assesses consumers willingness to purchase genetically modified gm food products with two different types of benefits an input i e reduced pesticides and an output trait benefit i e nutritionally enhanced data were collected using a telephone survey of an italian households sample discrete choice approach is used to elicit the purchase intentions of the respondents four separate probit models are estimated to examine the effect of various factors on choices results suggest that majority of italians are not willing to buy gm food products even if they are nutritionally enhanced however more consumers are willing to buy a nutritionally enhanced plant based gm product than a traditional plant based gm with input trait benefit willingness to buy for a nutritionally enhanced animal based gm product and for a traditional animal based gm product with input trait benefit are similar consumers unwilling to buy gm food would not buy it even if it is nutritionally enhanced and has lo

valuing wetland attributes an application of choice experiments abstract the interest for wetlands is increasing not only because of the possibility of a cost efficient uptake of nutrients but also because wetlands can be designed to provide other services what values that are supplied depend largely on the design there are numerous different design options and different actors may promote different alternatives whether we want to design a wetland for nutrient retention alone or one that also serves other interests policy makers need information about the value of different options conducting a choice experiment we are able to identify attributes that increase and decrease citizens perceived value of wetlands using a random parameter model we find that biodiversity and walking facilities are the two greatest contributors to welfare while a fenced waterline and introduction of crayfish decrease welfare

convergent validity of attribute based choice questions in stated preference studies the application of attribute based choice questions is well established in the marketing literature but there are unique aspects of the design that warrant investigation to assess their validity for economic welfare estimation three design issues are investigated in this paper 1 the placement of the monetary stimulus policy cost to respondents in the sequence of attributes 2 the number of policy alternatives respondents are asked to consider in choice questions two versus three and 3 the inclusion versus exclusion of a status quo alternative in choice questions the data used to implement these investigations are from a survey designed to estimate the value maine residents place on a farmland conservation easement program tests of convergent validity indicate that the placement of the monetary stimulus first versus last in the list of attributes did not affect estimates of preference parameters significant differences between questions with three versus two alternatives did occur and the inclusion exclusion of a status quo alternative did not affect preference parameters

dynamic relationships between us and thai rice prices abstract relationships between the united states department of agriculture s usda estimated world market price the thai milled rice price us transportation adjusted cash rough rice price and the chicago rice and cotton exchange rough rice futures price are examined for the 1987 1991 marketing years specifically a cointegration analysis is used to address the pricing and informational efficiency of the respective markets testing indicates the system is described by two cointegrating vectors the analysis preformed herein provides insight into the pricing performance of several world rice markets

consumer willingness to pay for genetically modified food in kenya genetically modified gm crops are popular in many regions of the world but their deployment in africa is hindered by safety concerns and regulatory issues although the continent is in dire need of boosting its food production although consumers acceptance of gm food has been analyzed in many continents no such studies have been conducted in africa therefore a survey of 604 consumers was conducted in nairobi kenya in 2003 to gauge consumers awareness of gm crops their willingness to pay wtp for gm food and the factors that influence their wtp consumers knowledge of gm crops was limited and only 38 of the 604 respondents were aware of gm crops people in higher education and income groups were more aware than others regardless people were generally appreciative of the technology and a large majority 68 would be willing to buy gm maize meal at the same price as their favorite brand consumers were however concerned about possible side effects especially on the environment and biodiversity wtp was estimated using a double bounded dichotomous choice model and the mean wtp was found to be 13 8 higher than the average price of non gm maize meal perceptions of health risk and ethical and equity concerns had a negative influence on the likelihood of purchasing gm maize meal whereas trust in government to ensure food quality had a positive influence on wtp people with at least some secondary education and those in the high income category were more likely to purchase gm maize meal at the same price the study concludes that because awareness is still low appropriate communications are needed to involve the consumer in the debate consumers acceptance in this study was high but the research needs to be expanded to rural areas where most consumers live and other survey methods need to be explored

recent evolutionary theorizing about economic change this famous passage from marshall s principles of economics it first appeared in the fifth edition which came out in 1907 nicely brings out two issues which are as germane to economics today as they were when marshall wrote the first is the heavy reliance by economists in their formal theorizing on the notion of equilibrium the other is the appeal that biological conceptions3x201d have for many economists particularly when their focus is on economic change

choice modelling and its potential application to tropical rainforest preservation abstract loss of rainforest occurs in part because of a global market failure problem markets routinely transmit signals about international demands for forest products such as timber but fail to transmit signals about demands for preservation to make efficient resource allocation choices decision makers need some framework to estimate the non use values that might be held by an international community for rainforest preservation non market valuation techniques can be used for this purpose but framing and other problems limit the application of the contingent valuation method cvm an alternative technique choice modelling cm appears to hold some promise because it can be used to model complex situations and to frame choices consistent with real life choices in this paper a cm experiment to assess the values that australians hold for rainforest conservation in vanuatu is reported the experiment disguises effectively the issue of interest rainforest conservation in vanuatu within a pool of other conservation locations also the experiment demonstrates that choice tradeoffs may involve a variety of environmental and socio economic factors rather than be concentrated on some monetary tradeoff the results demonstrate that a variety of predictive and valuation tools can be gained from a cm experiment and suggest that further development is warranted

the dynamics of international differentiation a multi country evolutionary model the paper presents some admittedly preliminary results on evolutionary modeling of open economies interactions the dynamics is microfounded in a multiplicity of boundedly rational agents who imperfectly learn how to innovate in environments characterized by notionally unlimited opportunities micro discoveries is shown can generate persistent system level effects despite the absence in the model of any institutional specificity of individual countries processes of innovative exploration and imitation yield international divergence less often convergence catching up and falling bebind

a comparison of stated preference methods for environmental valuation this paper presents an empirical comparison of contingent valuation cvm and choice experiments which are used to value environmental quality changes both of these methods require individuals to state their preferences for environmental qualities however choice experiments differ from cvm in that environmental attributes are varied in an experimental design which requires respondents to make repeated choices between bundles of attributes the empirical application involved the effect of environmental quality changes arising from forest management practices on recreational moose hunting values significant differences were found between the values derived from the two methods however detailed examination of the implied choice behaviour suggested that respondents ignored substitute recreation areas in the cvm question restricting the choice experiment model to consider only the one site where quality was varied resulted in welfare estimates similar to the cvm model this highlights the importance of substitutes in environmental valuation and suggests that choice experiments may be more appropriate than cvm in some cases