the market for blood donating blood the gift of life is among the noblest activities and it is performed worldwide nearly 100 million times annually the economic perspective presented here shows how the gift of life albeit noble and often motivated by altruism is heavily influenced by standard economic forces including supply and demand economies of scale and moral hazard these forces shaped by technological advances have driven the evolution of blood donation markets from thin one to one marriage markets in which each recipient needed a personal blood donor to thick impersonalized diffuse markets today imbalances between aggregate supply and demand are a major challenge in blood markets including excess supply after disasters and insufficient supply at other times these imbalances are not unexpected given that the blood market operates without market prices and with limited storage length about six weeks for whole blood yet shifting to a system of paying blood donors seems a practical impossibility given attitudes toward paying blood donors and concerns that a paid system could compromise blood safety nonetheless we believe that an economic perspective offers promising directions to increase supply and improve the supply and demand balance even in the presence of volunteer supply and with the absence of market prices

the impact of private and public feedback on worker performance evidence from the lab previous empirical studies have demonstrated the positive incentive effects of private performance feedback as well as public recognition on work performance in our laboratory experiments we directly compare these two feedback schemes moreover we compare their incentive effects across two real effort tasks that differ in regard to how interesting the subjects perceive working on them we find that both feedback schemes lead to performance increases compared to the tasks respective control treatments in particular subjects ability and a positive interim feedback enhance performance competitive preferences significantly affect performance only in the less enjoyable and challenging task jel c9 j3 m1

waiting to give stated and revealed preferences we estimate and compare the effect of increased time costs on consumer satisfaction and behavior we are able to move beyond the existing literature which focuses on satisfaction and intention and estimate the effect of waiting time on return behavior further we do so in a prosocial context and our measure of cost is the length of time a blood donor spends waiting we find that relying on satisfaction data masks important time cost sensitivities namely it is not how the donor feels about the wait time that matters for return behavior but rather the actual duration of the wait consistent with theory we develop our results indicate that waiting has a significant longer term social cost we estimate that a 38 increase equivalent to one standard deviation in the average wait would result in a 10 decrease in donations per year this paper was accepted by uri gneezy behavioral economics

entrepreneurial human capital and the long run survival of firms in india abstract this paper analyses the characteristics of entrepreneurs that contribute to firms survival in less developed countries ldcs the study which relies on data collected in a 1971 survey of entrepreneurs in south india and a follow up survey of surviving firms in 1993 finds that entrepreneurial human capital greatly influences firm survival the results indicate that firms founded by older entrepreneurs in higher castes are most likely to survive but that increased education of the founding entrepreneur reduces survival these results provide evidence that opportunities of entrepreneurs outside the firm ignored in most theories are important in firm survival

consumer response to commodity specific and broad based promotion programs for fruits and vegetables generic promotion activities have traditionally been used for individual agricultural commodities yet there is renewed interest in implementing a mandatory broad based promotion program for all fruits and vegetables here we use data from an experiment that introduce subjects to various promotional efforts for fruits and vegetables to estimate the shift and rotational effects of advertising econometric results indicate that commodity specific promotional efforts may not be effective at increasing demand for fruits and vegetables after controlling for various demographic differences among treatments our results show that consumers valuation of fruits and vegetables was highest among subjects exposed to broad based advertisements copyright 2011 oxford university press

real exchange rate volatility and the price of nontradable goods in economies prone to sudden stops the dominant view in the empirical literature on exchange rates is that the high variability of real exchange rates is due to movements in exchange rate adjusted prices of tradable goods this paper shows that this dominant view does not hold in mexican data for the periods in which the country had managed exchange rate regimes variance analysis of a 30 year sample of monthly data shows that movements in the price of nontradables relative to tradables account for up to 70 percent of the variability of the real exchange rate during these periods the paper proposes a model in which this stylized fact and the sudden stops that accompanied the collapse of mexico s managed exchange rates could result from an endogenous amplification mechanism operating via nontradables prices in economies with dollarized liabilities and credit constraints the key feature of this mechanism is irving fisher s debt deflation process numerical evaluation suggests that the fisherian deflation effects on consumption the current account and relative prices dwarf those induced by the standard balance sheet effect typical of the sudden stops literature

import price elasticities reconsidering the evidence recent economic geography and trade empirical studies based on monopolistic competition suggest high levels of trade price elasticities between 3 and 1 1 however price elasticity estimations in trade equations using unit values as price proxies usually lead to lower values of around unity we show that those inconclusive results may be due to some misspecification in these equations as well as measurement errors in prices when suit able instrumental variables are used within a panel of industrialized countries we obtain high price elasticities the majority ranging from i to 13 the highest estimates correspond to industries producing homogeneous goods jel classification c2 c3 and f 1

the change of tide in political cooperation a limited information model of european integration european integration follows a puzzling stop and go pattern that traditional international reations theories cannot fully explain the predominating paradigms only account for either the achievements or the setbacks of the integration process an information based explanation makes it possible to move beyond structural accounts provided by realist and functionalist scholarship such an approach yields solid micro level foundations of international bargaining and focuses on leaders use of threats in negotiations about regional cooperation situations involving governments agreeing on the necessity of further integration but disagreeing about its level create room for strategic manipulation of information asymmetries this type of uncertainty stems from the manipulator s information and control advantages concerning domestic costs the analysis of different summit meetings demonstrates the empirical relevance of such maneuvers for the dynamics of european integration

advertising and the us market demand for beer the us per capita market demand for beer is empirically estimated to determine the effect of advertising on the demand for beer the empirical results indicate that the most important determinants of demand are the price of beer the price of substitutes demographic factors and a light beer dummy variable the positive effects of income and lagged consumption appear to be small although many have argued that advertising promotes beer consumption the empirical results of this study do not support this hypothesis

religious participation and children s education a social capital approach abstract based on the argument in both economic and sociological literature that religion is conducive to children s human capital formation this paper provides a model of religious participation and explores a mechanism that social capital affects children s education a la coleman coleman j s 1988 social capital in the creation of human capital american journal of sociology 94 s95 s120 the model generates several interesting implications which help explain some important stylized facts about education and religion further in a dynamic setting the model shows that there exists a steady state in which individuals allocate a positive amount of time and resources to religious activities thus it complements the existing literature to explain why seemingly unproductive religions can be everlasting

coordination and contagion individual connections and peer mechanisms in a randomized field experiment abstract this paper investigates peer effects at the level of individual connections leveraging the approach to shed light on peer mechanisms in a field experiment using college freshmen we elicited best friends and offered monetary incentives for gym visits to a treated subset we find large spillovers from treated subjects to treated best friends but none from treated subjects to control best friends we also find evidence of a mechanism subjects coordinate by visiting the gym with best friends indicating that the intervention harnesses complementarities in utility or commitment mechanisms results highlight subtle peer effects and mechanisms that often go undetected

managing blood donations with marketing blood banks rely on marketing to encourage donors to give blood many if not most blood banks in the united states are community based not for profit organizations with limited marketing budgets as a result blood banks increasingly use novel and inexpensive online media i e paid owned and earned poe media in their marketing efforts we propose a dynamic model to help blood bank marketing managers understand how blood donations can be managed via online poe media we analytically characterize the optimal forward looking paid media strategies taking into account the asymmetric costs related to shortage and excess of blood as well as the possibility of a cost free target donation zone we detail new advertising resource allocation rules for blood banks and show when traditional allocation recommendations do not apply additionally we discover that under certain circumstances owned earned media activities hurt the blood bank s performance despite being predominantly free we validate our analytical model by using daily donation data from a community based blood bank and measure the effects of poe media activities on the level of blood donated

stigler becker versus myers briggs why preference based explanations are scientifically meaningful and empirically important abstract economists typically object to preference based explanations of human behavior differences in preferences explain everything and therefore nothing but this argument is only correct assuming that no empirical evidence exists to discipline preference based explanations in fact over the past decade personality psychologists have produced a robust collection of stylized facts about human preferences while preferences are empirically quite stable they are far from identical and have proven predictive power for economically interesting variables the empirical challenge for future research is to jointly estimate the impact of preferences and constraints to obtain unbiased measures of their relative importance

blood donations and incentives evidence from a field experiment abstract there is a longstanding concern that material rewards might undermine pro social motivations thereby leading to a decrease in blood donations this paper provides an empirical test of how material rewards affect blood donations in a three month large scale field experiment and a fifteen month follow up period involving more than 10 000 previous donors we examine the efficacy of a lottery ticket as a reward vis a vis a standard invitation an appeal and a free cholesterol test the offer of a lottery ticket on average increases the probability to donate blood during the experiment by 5 6 percentage points over a baseline donation rate of 46 we find that this effect is driven by less motivated donors moreover no reduction in donations is observed after the experiment

addiction and discounting abstract in 1988 becker and murphy becker g s murphy k m 1988 a theory of rational addiction journal of political economy 96 675 700 launched a theory in which they proposed that the perspective of rational decision making could be applied also to cases of addictive behaviour this paper discusses the theory s assumptions of interpersonal variation and stability in time preferences on the basis of estimates derived from three groups of people with different consumption levels of illegal intoxicants we find that active injectors of heroin and amphetamine have a higher discount rate than a group reporting that they have never used the substances of greater interest though not in accordance with becker and murphy s assumption of stability we also find that the discount rate among active and former users differs significantly these findings raise the question of whether a high time preference rate leads to addiction or whether the onset of an addiction itself alters people s inter temporal equilibrium

rational behavior and economic theory abstract nowadays it seems almost universally presumed that the fundamental characteristic of homo oeconomicus is his rationality we analyze the role played by the concept of rationality in economic theory and demonstrate that it is necessarily constrained to be an essentially contentless notion we show that the main body of economic theory is firmly grounded and that some contrasting approaches to rationality although leading to heated debates and vivid confusion have no fundamental significance for economics with a refereshed view on the essence of economics we argue that the principles of economic theory form an essential methodological guide for the emergent line of research based on the use of so called evolutive models

entrepreneurship social mobility and income redistribution in south india development economists have been preoccupied with the problem of increasing the size of the gnp pie to the relative neglect of its distribution despite the recent disenchantment with the viewpoint that all classes share in the benefits of industrial growth empirical data on the distribution of income business opportunity and economic power are in short supply many of the studies on entrepreneurship and economic development when they are not apologetics for ruthless capitalist exploitation as paul baran suggests extol the achievements of the capitalist entrepreneur without examining class origins and monopoly advantage joseph schumpeter sees entrepreneurs irrespective of class origin as heroic figures with the dream and will to found a private kingdom to conquer adversity to achieve success for its own sake and to experience the joy of creation for gustav papanek 1967 the private entrepreneur who is frugal diligent far sighted remarkably able and willing to take political risks is in large part responsible for the success of pakistan in achieving rapid industrialization

excusing selfishness in charitable giving the role of risk decisions involving charitable giving often occur under the shadow of risk a common finding is that potential donors give less when there is greater risk that their donation will have less impact while this behaviour could be fully rationalized by standard economic models this article shows that an additional mechanism is relevant the use of risk as an excuse not to give in a laboratory study participants evaluate risky payoffs for themselves and risky payoffs for a charity when their decisions do not involve tradeoffs between money for themselves and the charity they respond very similarly to self risk and charity risk by contrast when their decisions force tradeoffs between money for themselves and the charity participants act more averse to charity risk and less averse to self risk these altered responses to risk bias participants towards choosing payoffs for themselves more often consistent with excuse driven responses to risk additional results support the existence of excuse driven types

international passenger transport and climate change a sector analysis in car demand and associated co2 emissions from 2000 to 2050 abstract the paper provides global regionalized projections of passenger car demand use and associated co 2 emissions from 11 world regions the study is based on empirical data that have been originally collated from international sources for the purpose of modeling region specific car stock demand derived demands serve as indicator of car related fuel consumption and associated co 2 emissions which are calculated on the basis of behavioral and technological scenarios the obtained co 2 emission paths are sectoral baseline scenarios that identify region specific potentials of growth in car induced co 2 emissions assuming that current trends continue to prevail the study adopts a multi model approach to car demand by applying two methodologies rooted in the economics of consumption utility maximization and single equation models the utility maximization method for modeling car demand is driven by the preferences of the representative consumers of each world region subject to exogenous price and income trajectories the latter is adopted from an optimal growth model this is a novel approach to projecting global regionalized sectoral car demands the study is complemented by the application of single equation income consumption models based on logistical gompertz functions and non linear regression techniques to compare model results

price and income elasticities of disaggregated import demand results from uecms and an application this paper presents an empirical analysis of the demand for maize milk powder butter and rice imports in cyprus using annual time series data covering the period 1975 1994 none of these products is produced in cyprus and all the necessary quantities are imported to meet domestic demand the primary objective of the paper is to derive long run price and income elasticities of import demand that can be used to analyse the impact of various policies such as the adoption of the common agricultural policy cap when and if the republic of cyprus joins the european union eu in so doing the paper takes on board some recent developments in time series econometrics the cointegration test used the bounds test is a recent test and is based on the estimation of an unrestricted error correction model uecm parsimonious models were derived using hendry s general to specific approach the estimated elasticities were subsequently used to quantify some of the implications for cyprus had the cap been ope

a cointegration analysis of seafood import demand in caribbean countries cointegration analysis and error correction model are used to estimate seafood import demand for selected caribbean countries the results show that seafood import is price elastic exchange rate has a negative effect while gross domestic product gdp and tourism have positive effects on seafood imports import and domestic production do not have a short run causal relationship the increase in caribbean seafood imports is primarily due to decreasing import price and increasing domestic demand the decline of domestic fisheries production has other causes than import competition however imports and domestic production have a negative long run equilibrium relationship tariff and production expansion policies both help producers but tariff may reduce total economic surplus while supply expansion can increase total economic surplus

group utility in the micro motivation of collective action the case of membership in the aarp abstract the fundamental assumption of human rationality in neo classical economic analysis is the maximization of individual utility as economic analyses are being widely used in political science under the broad rubric of public choice one cannot escape the logical inconsistency between theory and reality arising from the free rider problem in the preference for collective goods recent literature argues that a way out of this dilemma is to recognize the existence of motivations other than self interest this paper demonstrates the need to enlarge the assumption of economic rationality by explicitly taking into account the factors of group utility with the help of survey data on the preference for membership in the american association of retired people aarp this study adds to the mounting empirical evidence for the fact that for a proper understanding of collective action the existence of a collective identity should be recognized

international fish trade and exchange rates an application to the trade with salmon and fishmeal international fish trade is growing and fish exports represent an important source of foreign currency for many countries for a few countries the exports are also an essential part of the economy we revisit the seminal paper of richardson 1978 that addresses the issue of exchange rate pass through in commodity markets but in a multivariate cointegration framework the multivariate cointegration framework allows us to test common assumptions like exchange rate pass through leading price central markets and exogeneity of exchange rates this approach is particularly suited when studying markets for primary products we provide empirical examples using salmon imports to japan and fish meal exports from peru to germany

selective recognition how to recognize donors to increase charitable giving recognizing donors by revealing their identities is important for increasing charitable giving we conducted a field experiment to examine how different recognition methods impact giving and found that all forms of recognition that we examined had a positive impact on increasing donations whereby recognizing only highest donors positive recognition and recognizing only lowest donors negative recognition had the most pronounced effect we argue that selective recognition both positive and negative creates tournament like incentives recognizing the highest donors activates the desire to seek a positive prize of prestige thus increasing the proportion of donors who contribute large amounts recognizing the lowest donors activates the desire to avoid a negative prize of shame thus decreasing the proportion of donors who do not contribute or contribute very little therefore selective recognition is an effective tool that can be used in the field by charities to increase donations

terrorism the relevance of the rational choice model terrorism in general and suicidal terrorism in particular is popularly seen as irrational but many economists and political scientists argue otherwise this paper distinguishes three different senses of irrationality unresponsiveness to incentives deviation from narrow self interest and failure of rational expectations it concludes that an intermediate position on the rationality of terrorism is appropriate the typical terrorist sympathizer deviates only slightly from homo economicus but active terrorists arguably stray from narrow self interest and rational expectations and suicidal terrorists probably violate both deterrence remains a viable anti terrorism strategy but deviations from rational expectations increase the potential of persuasion and appeasement

social image concerns and prosocial behavior field evidence from a nonlinear incentive scheme abstract using longitudinal data on the entire population of blood donors in an italian town we examine how donors respond to a nonlinear award scheme that rewards them with symbolic prizes medals when they reach certain donation quotas our results indicate that donors significantly increase the frequency of their donations immediately before reaching the thresholds for which the rewards are given but only if the prizes are publicly announced in the local newspaper and awarded in a public ceremony the results are robust to several specifications sample definitions and controls for observable and unobservable heterogeneity our findings indicate that social image concerns are a primary motivator of prosocial behavior and that symbolic prizes are most effective as motivators when they are awarded publicly we discuss the implications of our findings for policies aimed at incentivizing prosocial behavior

the provision of public goods via advertising existence of equilibria and welfare analysis abstract this paper considers an economy where a public good is provided via advertising the consumers preferences are represented using the characteristics approach and the advertising has a potentially enhancing effect on the characteristics content of a given commodity we define competitive equilibria and show they exist the welfare properties of the resulting allocations are analyzed and conditions for over and under production of the public good are provided

the effects of banning advertising in junk food markets we develop a structural model to analyze the eects of banning advertising on market equilibria and welfare in junk food markets we consider the impact on demand and prices and show how to quantify welfare eects when advertising might lead consumers to take decisions that are inconsistent with their underlying preferences we use transaction level data on the potato chips market and nd that banning advertising leads to a direct reduction in demand but also toughens price competition leading to lower prices and increased demand welfare increases as consumers benet from no longer making distorted

group consumption free riding and informal reciprocity agreements we examine conditions under which group consumption is likely to involve informal reciprocity agreements rather than a price system our model shows that reciprocity agreements are used when transactions costs are high the good is inexpensive demand is inelastic the group continues to interact over time the consumers are patient the time between interactions is short and the group is small and homogeneous further the results suggest that reciprocity agreements are likely to involve goods that are consumed along with other group benefits such as companionship we use the model to analyze overlapping social networks and investments in social capital

genetic variation in financial decision making individuals differ in how they construct their investment portfolios yet empirical models of portfolio risk typically account only for a small portion of the cross sectional variance this paper asks whether genetic variation can explain some of these individual differences following a major pension reform swedish adults had to form a portfolio from a large menu of funds we match data on these investment decisions with the swedish twin registry and find that approximately 25 of individual variation in portfolio risk is due to genetic variation we also find that these results extend to several other aspects of financial decision making

low income and poor health choices the example of smoking people with low incomes tend to make less healthy consumption choices than do high income people in the case of food agricultural economists have investigated whether this is due to the cost of a healthy diet studies of various aspects of the nutrition income nexus have generally been inconclusive we investigate a different possibility motivated by the fact that low income individuals are most likely to be smokers which cannot be due to limited budgets drawing on a body of related literature we develop a model in which income serves not only as a budget constraint but also as a source of future utility we test the model by estimating logistic models of beginning and quitting smoking we find support for the idea that low income consumers make less healthy choices because they face lower costs in terms of foregone future utility

emergent extremism in a multi agent model of religious clubs i introduction religious extremism is as old as religion itself but the tendency to promote militancy and terrorism from within extremist religions appears to be much more common now than in times past juergensmeyer 2001 stern 2003 wiktorowicz 2005 1 today s terrorists routinely frame their objectives in religious terms and organize their activities within religious movements this shift is not due to increased militancy within religion as a whole not even within the stricter subset of religious groups commonly labeled sectarian or fundamentalist bromley and melton 2002 marty and appleby 1995 rather groups with militant objectives are increasingly leveraging the latent potential for violence within extremist religion krueger and maleckova 2003 and krueger 2007 have shown that contrary to popular hypotheses regarding the salience of poverty and education it is instead institutional conditions such as civil liberties that contribute to the origination of terrorists within a country religious extremism has been shown to be a potentially powerful input into the production of terrorism berman 2004 2 and the origination of terrorists has been empirically connected to civil liberties we seek to complete the triangle and connect religious extremism to social conditions in an extension of existing theory and test the predictions of the model in an empirical context with an eye toward civil liberties this paper extends previous models of religious clubs to better account for observed patterns of extremism across different settings and test policies most likely to reduce the appeal of extremism economists at first blush should have trouble explaining the survival of groups that demand large sacrifices from their members successful religious groups however routinely impose all sorts of apparently unproductive costs on their members iannaccone 1992 introduced a formal model of religious clubs within which apparently irrational sacrifice and stigma enhances the individual and collective utility his model demonstrated the feasibility of extremist groups but does less to explain the relative prevalence of extremism across time and place further the original model allows for only corner solutions and as such the viability of extreme groups is indistinguishable from the viability of the more moderate groups they must compete with for members in the religious marketplace in section ii we revisit analyze and extend the club model of religion we push the analysis of the original model exploring sacrifice substitutability of club and private goods and their relationships to member commitment and the viability of extremist groups in this preliminary analysis we illustrate not only the potential insights of the club theory of religion into the strength and viability of extremist groups but also the limitations inherent to the representative agent model we proceed by extending the model in a multi agent ma computational framework this framework permits us to analyze the distributions of agents and clubs that make up a religious economy the computational nature of the model is critical because it allows for sufficient heterogeneity of agents and clubs and given this heterogeneity agent decision making absent closed form solutions via nash equilibria extremists groups emerge as just one segment the high cost tail of a distribution of religious clubs that range across the full spectrum of potential group imposed sacrifice and stigma extremism is identifiable and comparable in the model because it exists within a full spectrum of clubs by varying the parameters of the model that control the distribution of secular wages across agents and the degree of substitutability between religious and secular commodities we can better explain where and when religious extremism is most popular its strength relative to more moderate groups and which economic policies reduce its prevalence

design innovation and fashion cycles a model of fashion cycles is developed in which designs are used as a signaling device in a dating game a monopolist periodically creates a new design over time the price of the design falls as it spreads across the population once sufficiently many consumers own the design it is profitable to create a new design and thereby render the old design obsolete this paper gives conditions under which all consumers would be better off by banning the use of fashion competition among designers may lead to less frequent changes in fashion and to higher prices than monopoly copyright 1995 by american economic association

embedded altruism blood collection regimes and the european union s donor population 1 blood donation is often cited as a perfect example of altruism but blood must be collected as well as donated and the organizational basis of the blood supply has been largely neglected this article is a comparative study of blood collection regimes in europe regimes are found to affect donation rates and donor profiles when the red cross collects blood donation is tied to religious activity and other volunteering unlike state and blood bank systems this study argues that collection regimes produce their donor populations by providing differing opportunities for donations the analysis contributes to an institutional perspective on altruism and highlights the need to attend to the socially embedded nature of altruistic as well as self interested action

attitudes and allocations status cognitive dissonance and the manipulation of attitudes abstract economic studies of social status have typically focused on individuals engaging in relative comparisons based on certain characteristics e g consumption wealth without considering why these characteristics are deemed status worthy in this paper individuals choose a status earning characteristic in order to reduce mental discomfort dissonance as a result those individuals with the highest marginal utility from income are often the first to misconstrue or abandon these incentives in favor of alternate forms of seeking status the model provides an explanation for endogenous class formation and highlights the role of redistributive taxation in manipulating individuals attitudes towards status

the robot the party animal and the philosopher an evolutionary perspective on deliberation and preference this paper examines the evolutionary fitness of a variety of ways of reaching decisions in early hunter gatherer societies in order to derive insights about how economists should view modern consumers it challenges conclusions reached by mainstream economists robson rayo and becker about why hunter gatherers needed sensory rewards and about the kinds of preference systems that would have conferred evolutionary fitness it argues that evolution favours those with a variety of ways of reaching decisions programmed deliberative intuitive and go with the flow and that the prospect of sensory rewards serves an evolutionary role by diverting people from thinking too much about what they are doing in situations in which deliberation might interfere with survival or reproduction the evolutionary role of a reluctance or failure to make trade offs is also considered along with the benefits of developing a relatively fixed identity rather than being all things to all men

towards sustainable consumption economic modelling of mobility and heating for austria abstract the paper focuses on economic modelling and empirical analysis of sustainable structures in private consumption and strives to extend conventional economic consumption models the model analysis of sustainable consumption in the areas heating and transport for austria attempts to depart from traditional measurement of consumption in national accounts and economic consumption models the focus of the analysis is laid on consumer services derived from a combination of stocks e g building stock transport systems and flows mainly energy this approach intends to illustrate that a concentration on flows in consumption models lacks important aspects of sustainable consumption the economic analysis of sustainable consumption patterns aims to highlight the effects related to the substitution of flows by stocks in the consumption areas transport and heating e g improvements in thermal quality of buildings more energy efficient transport systems relevant too in this respect is the role that can be played by technological innovation improvements in energy efficiency of stocks the potential for specific incentives to promote new technologies two essential factors are crucial in the context of sustainable consumption the demand shifts concerning the consumer services desired and the composition of the stock flow mix necessary for the service provision

talent and publicity as determinants of superstar incomes empirical evidence from the motion picture industry by drawing on the two prevailing economic stardom theories the paper investigates the sources of superstardom in the us movie industry for the econometric analysis we use income and popularity d

paying attention or paying too much in medicare part d we study whether people became less likely to switch medicare prescription drug plans pdps due to more options and more time in part d panel data for a random 20 percent sample of enrollees from 2006 2010 show that 50 percent were not in their original pdps by 2010 individuals switched pdps in response to higher costs of their status quo plans saving them money contrary to choice overload larger choice sets increased switching unless the additional plans were relatively expensive neither switching overall nor responsiveness to costs declined over time and above minimum spending in 2010 remained below the 2006 and 2007 levels

on the cultural transmission of preferences for social status abstract we study the formation of preferences for social status as the result of intergenerational transmission of cultural traits we characterize the behavior of parents with preferences for status in terms of socialization of their children to this particular cultural trait we show that degenerate distributions of the population whereby agents have either all status preferences or all non status preferences are dynamically unstable moreover under some conditions there exists a unique stationary distribution which is non degenerate in which both status and non status preferences co exist in the population and this distribution is locally stable finally we study the dependence of the stable stationary distribution of status preferences on institutional technological and policy parameters which affect agents economic conditions

the market for preferences learning processes are widely held to be the mechanism by which boundedly rational agents adapt to environmental changes we argue that this same outcome might also be achieved by a different mechanism namely specialisation and the division of knowledge which we here extend to the consumer side of the economy we distinguish between high level preferences and low level preferences as nested systems of rules used to solve particular choice problems we argue that agents while sovereign in high level preferences may often find it expedient to acquire in a pseudo market the low level preferences in order to make good choices when purchasing complex commodities about which they have little or no experience a market for preferences arises when environmental complexity overwhelms learning possibilities and leads agents to make use of other people s specialised knowledge and decision rules

how similar are alcohol drinkers international evidence stigler and becker 1977 argue that tastes neither change capriciously nor differ importantly between people it is differences in prices and incomes that determine differences in behaviour in this paper we analyse the alcohol consumption patterns of drinkers from 8 industrialized countries we identify a number of empirical regularities and verify stigler and becker s hypothesis that income and price elasticities of demand are international constants by showing that alcohol consumption patterns in the eight countries exhibit intriguing similarities the income and price elasticities of alcohol are found to be about 0 8 and 0 6 respectively in all eight countries

crowding out in the labor market a prosocial setting is necessary recent studies mostly from prosocial settings suggest that monetary rewards may crowd out effort exertion by economic agents we design a field experiment with data entry workers to investigate the extent of such crowding out effects in a labor market using simple variations in the job description of a task we induce a natural work setting under the work frame and emphasize social preference under the social frame we find that crowding out of labor participation critically depends on framing whereas small monetary rewards reduce the participation rate under the social frame the participation rate is nondecreasing in the wage rate under the work frame moreover among the workers who participate in the task those who receive a positive wage perform a considerably higher amount of work than those who are paid zero wage under either frame thus there is weak evidence of crowding out only when the task is explicitly given a prosocial flavor and not under a regular work setting furthermore emphasizing social preference in the labor market in such a way reduces the overall labor supply and seems to have an adverse effect on the quality of work data as supplemental material are available at http dx doi org 10 1287 mnsc 2013 1807 this paper was accepted by john list behavioral economics

purchasing power parity and real factors it is acknowledged that purchasing power parity ppp fails in empirical tests the position adopted is that real factors are an omitted variable from the ppp relationship and are the cause of divergences from ppp the real exchange rate as being determined by supply and demand shift factors as in stockman 1987 and neary 1988 is modelled we then empirically estimate a real exchange rate equation and use the fitted value as a generated regressor in tests of ppp it is demonstrated that when changes in the real exchange rate are incorporated into the ppp relationship ppp improves

the convoluted influence of robbins s thinking on the emergence of economics imperialism this article analyses the influence of robbins s thought on the subsequent development of economics imperialism first the analysis of some passages that have been overlooked up to the present in which the author explicitly expresses his disbelief in the omnipotence of the economic method makes it possible to argue that robbins did not share the confidence exhibited by the advocates of economics imperialism in the capacity of economics to explain non economic phenomena second this article shows that robbins describes the influence of real scarcity on human behaviour in terms of a static constrained maximization problem thereby confusing issues of method and scope in his writings this confusion facilitated the view that economics is a method without a proper subject matter and its later expansion into other fields in conclusion although robbins cannot be counted as an earlier promoter of economics imperialism the misunderstandings implicit in his writings paved the way for the emergence of this intellectual movement

world food demand long term projections of global food demand are heavily dependent on which functional form of the food demand equation is used given that real incomes can change substantially over the long term key elements are the dependence of the income elasticity on income which ensures that the food budget share always lies within the 0 1 range and the role of income inequality this article analyzes these issues proposes a new functional form that deals with them and presents estimates of income and price elasticities for food in 138 countries copyright 2012 oxford university press

unlocking amenities estimating public good complementarity abstract public goods may exhibit complementarities that are essential for determining their individual value our results indicate that improving safety near parks can turn them from public bads to goods ignoring complementarities may lead to i undervaluing the potential value of public goods ii overestimating heterogeneity in preferences and iii understating the value of public goods to minority households recent reductions in crime have unlocked almost 7 billion in property value in chicago new york and philadelphia still two fifths of the potential value of park proximity 10 billion remains locked in

consumers with differing reaction speeds scale advantages and industry structure abstract the development of an industry is seen as the outcome of a differential game in which market shares flow in response to price differences it is hypothesized that while all consumers eventually react to price differences some are slower than others if scale advantages have some influence on marginal costs around average market share then under reasonable conditions only skewed size distributions can be locally stable steady states in addition and contrary to common belief the largest firm need not eventually monopolize the industry

fiscal year ends and nonlinear incentive contracts the effect on business seasonality salesperson and executive compensation contracts typically specify a nonlinear relationship between firm revenues and pay these agents therefore have incentive to manipulate prices influence the timing of customer purchases and vary effort over their firms fiscal years this paper empirically establishes results consistent with agents focusing on performance over the fiscal year most notably in addition to varying with the calendar business cycle manufacturing firms sales are higher at the end of the fiscal year and lower at the beginning than they are in the middle further evidence is found in fiscal year price movements and patterns in the industry variation of fiscal year effects

saving power to conserve your reputation the effectiveness of private versus public information environmental damage is often an unseen byproduct of other activities disclosing environmental impact privately to consumers can reduce the costs and or increase the moral benefits of conservation behaviors while publicly disclosing such information can provide an additional motivation for conservation cultivating a green reputation in a unique field experiment in the residence halls at the university of california los angeles we test the efficacy of detailed private and public information on electricity conservation private information was given through real time appliance level feedback and social norms over usage and public information was given through a publicly visible conservation rating our analysis is based on 7 120 daily observations about energy use from heating and cooling lights and plug load for 66 rooms collected over an academic year our results suggest that while private information alone was ineffective public information combined with private information motivated a 20 percent reduction in electricity consumption achieved through lower use of heating and cooling public information was particularly effective for above median energy users

gary becker as teacher this paper looks at the work of gary s becker american economist professor of sociology friend and colleague of kevin m murphy murphy discusses the traditional approach of becker s teaching and ideas as they were expressed through his wealth of content and style in course design his discussions on the role of preferences technology and constraints as they influence household production and his emphasis on the importance of markets and desire for more murphy recognizes becker s teaching style as groundbreaking unapologetic and pure economics

loopholes undermine donation an experiment motivated by an organ donation priority loophole in israel article i nfo giving registered organ donors priority on organ waiting lists as has been implemented in israel and singapore pro vides an incentive for registration and has the potential to increase the pool of deceased donor organs however the implementation of a priority rule might allow for loopholes as is the case in israel in which an individual can reg ister to receive priority but avoid ever being in a position to donate organs we experimentally investigate how such a loophole affects donation and find that the majority of subjects use the loophole when available the existence of a loophole completely eliminates the increase in donation generated by the priority rule when information about loophole use is made public subjects respond to others use of the loophole by withholding donation such that the priority system with a loophole generates fewer do nations than an allocation system without priority 2013 published by elsevier b v