the box spread arbitrage conditions theory tests and investment strategies this paper develops and tests arbitrage bounds for a combination of two option spread positions known as a box spread this strategy involves the simultaneous use of four options and creates a position that is equivalent to riskless lending the no arbitrage conditions are compared to existing arbitrage bounds and are tested using chicago board options exchange data article published by oxford university press on behalf of the society for financial studies in its journal the review of financial studies

the structure of financial equilibrium with exogenous yields the case of incomplete markets1 this paper presents an analysis of the structure of competitive equilibrium in a model whose principal feature is incomplete financial markets formulated in the spirit of arrow specifically the overall payoffs or returns from financial instruments are assumed to be fixed or predetermined independently of the operation of the economy and these instruments are assumed to be fewer in number than required to span all potential spot markets for commodities our main result establishes that market incompleteness generates a corresponding degree of allocation indeterminateness suppose there are n 1 spot markets but only 0 m n linearly independent financial instruments so that the deficiency in financial markets is 0 n n m n then subject to some relatively innocuous technical qualifications the set of equilibrium allocations contains a smooth n dimensional submanifold we also indicate how real indeterminacy may increase when returns for example the market price and promised interest on an ordinary bond are treated as variables rather than parameters

martingales and arbitrage in securities markets with transaction costs abstract we derive the implications from the absence of arbitrage in dynamic securities markets with bid ask spreads the absence of arbitrage is equivalent to the existence of at least an equivalent probability measure that transforms some process between the bid and the ask price processes of traded securities into a martingale the martingale measures can be interpreted as possible linear pricing rules and can be used to determine the investment opportunities available in such an economy the minimum cost at which a contingent claim can be obtained through securities trading is its largest expected value with respect to the martingale measures journal of economic literature classification numbers g11 g12 g13 d52 and d90

towards a political economy approach to the convention on biological diversity international conventions are seldom reviewed in the literature devoted to environmental policy instruments however coordination is needed at a global level for global environmental problems characterised by scientific controversies uncertainty irreversibility long term impacts economic and geopolitical dimensions the convention on biological diversity is a good illustration in this regard the rules it promotes are clearly inspired by mainstream economics it has therefore been celebrated as a textbook example of sound environmental policy however its success has been limited so far and its position within the international conservation regime is challenged we argue that an alternative analytical approach to environmental global policies is needed and that the french theories of conventions and regulation open up promising prospects in this respect

deforestation and the rule of law in a cross section of countries relationships between deforestation and population pressure income growth and insecure property rights are examined with data from 120 countries insecure property rights are hypothesized to arise from two sources government instability or inability to enforce ownership and an absence of government accountability the former source is captured by measures of general lawlessness such as guerrilla warfare revolution and frequent constitutional change the latter is proxied by variables indicating the type of government executive frequency of political purges and the existence of an elected legislature general support is indicated for the property rights hypothesis and for the effects of population growth

bio cooperation and the benefits of crop genetic resources the case of mexican maize abstract concern for equity and conservation has prompted the creation of bio prospecting contracts for biological resources from less developed countries one potential type of contract is between farmers who provide crop genetic resources and seed companies or agencies that use these resources theoretically bio contracts will reward peasant farmers for preserving genetic resources and balance equities between farmers and seed companies using maize from mexico as a case study this paper concludes that contracting is problematic on both efficacy and equity grounds bio cooperation is presented as an alternative institutional support and licensing agreements that support human capital development are proposed as alternatives

financial innovation in a general equilibrium model abstract we develop a model of financial innovation in which intermediaries can issue new financial securities against collateral in the form of standard securities intermediaries have to market their innovations and marketing is costly we show that the equilibrium asset structure may exhibit redundancies as frequently observed on financial markets we give conditions for efficiency of financial innovation and show that with small innovation costs the indeterminacy of equilibrium allocations has small utility consequences journal of economic literature classification numbers d52 g10

general equilibrium with endogenously incomplete financial markets abstract the present paper studies a class of general equilibrium economies with imperfectly competitive financial intermediaries and price taking consumers intermediaries optimally choose the securities they issue and the bid ask spread they charge financial intermediation is costly and hence markets are endogenously incomplete an appropriate equilibrium concept is developed and existence is proved competitive equilibria for this class of economies display full indexation of securities payoffs and monetary neutrality even if intermediaries are restricted to issue nominal securities and financial markets turn out to be incomplete this is in sharp contrast with the indeterminacy and non neutrality results established in the literature for incomplete markets economies with exogenously given nominal securities journal of economic literaturclassification numbers d52 g20

changing the economics of environmental degradation in madagascar lessons from the national environmental action plan process abstract this paper examines the economic logic and implicit assumptions used to develop and support the national environmental action plan neap process in madagascar the study focuses on three key issues how were the costs of the main environmental problems identified and estimated what underlying factors were identified as causing these problems and how is the neap implementation strategy designed to change these underlying factors the most difficult tasks for neaps will continue to be identifying the key specific underlying factors causing the problem and determining which of these factors are actually feasible for a neap process to change the analysis of the madagascar makes clear that key environmental problems are driven by land use decisions of large numbers of geographically dispersed rural and urban inhabitants these problems are not easy or even feasible targets for specific environmental policy changes if this is the case as it seems to be in madagascar then it is perhaps unrealistic to hope that neaps as constituted can provide a framework for both understanding and alleviating a country s key environmental problems

financial market innovation and security design an introduction abstract the article describes in the context of theory and practice this special issue of the journal of economic theory on financial market innovation and security design the main focus is on security design in incomplete financial markets possibly with asymmetrically informed traders we first survey the general equilibrium literature which emphasizes the spanning role of securities we then provide a unified framework encompassing the literature that employs a cara guassian setting to study the impact of financial innovation on risk sharing and information aggregation journal of economic literature classification numbers g10 d52

a step back as donors shift institution building from the public to the private sector abstract frustrated with public sectors in developing countries donors have shifted support to nonprofit nongovernmental organizations this paper questions the preferability of the nonprofit or public sector from the donor and host country perspectives case study experience from agriculture and natural resource institutions in ecuador and the dominican republic is presented to expand upon current thinking about the role of the nonprofit sector nonprofits are found to possess substantially increased flexibility for donor purposes and avoid many of the pitfalls of the political process they are however subject to free rider problems and bear no responsibility to the general public

optimal security design how should new securities be designed traditional theories have little to say on this the literature on capital structure and general equilibrium theories with incomplete markets take the securities firms issue as exogenous this paper explicitly incorporates the transaction costs of issuing securities and develops a model where the instruments that are traded are chosen optimally and the economy s market structure is endogenous among other things it is shown that the firm s income stream should be split so that in every state all payoffs are allocated to the security held by the group that values them most this abstract was borrowed from another version of this item

coordination issues in policy implementation networks an illustration from madagascar s environmental action plan abstract policy implementation brings together multiple agencies and groups to work in concert to achieve a set of objectives making these joint arrangements function effectively depends upon multiactor linkages and coordination drawing upon the interorganizational and policy network literature this article discusses these issues and applies them to national environmental action plans neaps the article looks specifically at madagascar examining the implementation structure of the neap and how coordination problems are manifested the essay concludes with some recommendations directed toward improving the effectiveness of madagascar s neap but which have wider applicability to managing coordination among policy implementation actors in general

commission revenue maximization in a general equilibrium model of asset creation abstract a general equilibrium model of endogenous asset formation is given in which a monopolistic agent called the designer can create any types of assets and charage commissions as long as the total number of the types of assets does not exceed some given constant when the designer can create at most two assets a commission revenue maximizers always exists otherwise it may not moreover the so called maximizers may be badly behaved a profit maximiser may not exist even when the number of types of assets is endogenously determined from a positive fixed costs of creating an asset journal of economic literature classification numbers d52 d80

ambiguity aversion and incompleteness of financial markets it is widely thought that incomes risks can be shared by trading in financial assets but financial assets typically carry some risk idiosyncratic to them hence disposing incomes risk using financial assets will involve buying into the inherent idiosyncratic risk however standard theory argues that diversification would reduce the inconvenience of idiosyncratic risk to arbitrarily low levels this argument is less robust than what standard theory leads us to believe ambiguity aversion can exacerbate the tension between the two kinds of risks to the point that classes of agents may not want to trade some financial assets thus theoretically the effect of ambiguity aversion on financial markets is to make the risk sharing opportunities offered by financial markets less complete than it would be otherwise

optimal financial market integration and security design 1 we study 2 period pure exchange capital asset pricing model capm economies with incomplete financial markets and restricted participation we characterize the optimal financial market structure and efficient innovations consisting of both the introduction of new assets and the integration of segmented markets welfare gains from innovations are maximal when the endowments of affected agents are negatively correlated uncoordinated innovations lead to efficient market structures if all assets have identical participation structure or the markets being integrated trade identical assets however coordination failure in the introduction of new assets may result when assets have participation structures that overlap only partially

the costs of land degradation in sub saharan africa the overriding question that this article addresses is what are the immediate and future costs of land degradation for a nation the objectives of the analysis are to find appropriate measures to express the national level costs of land degradation and suitable methods to estimate such measures furthermore the aim is to document and interpret the results of existing studies to meet these objectives a set of 12 studies from sub saharan africa ssa is reviewed using a consistent cross study analytical framework derived from the objectives above with regard to measures of the cost of land degradation this article identifies ten different dimensions which illustrate the importance of qualifying statements about the costs of land degradation by rigorous clarification of what type of measure has been used furthermore with regard to methods of deriving costs of land degradation this article illustrates a spectrum of approaches one sub group has used a replacement cost approach while a productivity loss approach has been used in the majority of the studies reviewed the latter approach is further sub divided into five different categories ranging from the most informal to the most rigorous it is evident that very few original estimates exist of soil loss yield decline functions in sub saharan africa hence some of the basic work in this area is recycled for use in areas that may exhibit quite different conditions finally with regard to study results there is considerable variance of cost estimates pertaining even to the same country these differences can be explained however and a rational assessment allows a choice of the most appropriate results results across countries are reasonably well clustered in terms of their productivity impact per soil loss unit with local knowledge of soil conditions but in the absence of local yield loss data this provides a useful interval of reasonable assumptions as one would expect the national costs of land degradation vary considerably across countries this sometimes leaves room for considerable investment in soil and water conservation but should not invoke images of a rapidly approaching doomsday

property rights issues involving plant genetic resources implications of ownership for economic efficiency the economic theory of property rights is applied to the issue of the conservation of plant genetic diversity an issue often discussed in terms of benefit sharing in order to demonstrate that the assignment of property rights is important for reasons of efficiency as well as for equity given the existence of transaction costs within an industry the location of a property rights assignment is a crucial factor determining the incentives for efficient levels of investment at various levels of that industry in the context of plant genetic resources this means that property rights that are located at the retail end of the pharmaceutical and plant breeding industries may not have sufficient effect to generate the incentives to supply adequate amounts of plant genetic resources to the research and development sectors at the base of these industries

one market stocks futures and options during october 1987 we provide new evidence regarding the degree of integration among markets for stocks futures and options prior to and during the october 1987 market crash where previous analyses have resulted in recommendations for the implementation of circuit breakers the coordination of margin requirements across markets and changes in regulatory jurisdiction our analysis indicates that delinkage between markets during the crash was primarily caused by an antiquated mechanism for processing stock market orders the results suggest that market integration may be better served by efficient order execution than by further restricting markets

inflation debt and indexation these twelve essays cover topics on the frontier of indexation and practice an often proposed and debated tool of economic policy they range from highly theoretical discussions to practical experiences in brazil and europe rudiger dombush is ford international professor of economics at mit mario henrique simonsen is director of the postgraduate school of economics getulio vargas foundation rio de janeiro and former minister of finance and planning brazil

the convention on biological diversity a conventionalist approach the erosion of biological diversity pertains to the category of problems that are brought to the fore in debated universes there are scientific controversies about their definition import and possible solutions and they involve opposing economic interests and political strategies a convention commonly shared values set of definitions rules and norms implying a compromise among various actors and groups is needed to define and enforce policies the convention on biological diversity can be seen as an attempt to define such a middle ground the rights and policy orientations it promotes are however challenged by overlapping norms and rules enacted in other arenas such as the wto the purpose of this paper is to take up a conventionalist stance on the complex international regime that governs biodiversity management and conservation policies

capturing the pharmaceutical value of biodiversity in a developing country the conservation of biodiversity is increasingly being defined as a process made up of three components saving studying and sustainably using biodiversity if the conservation of process is expanded to incorporate the need for both the protection of biodiversity either in situ or ex situ and the generation of valuable information about biodiversity an important issue is the correct balance of investment in these two types of activities this paper explores this issue by focusing on efforts in a developing country to capture the pharmaceutical potential of biodiversity and species information a model of biodiversity investment choice is developed and an analysis of royalty returns to effort in biodiversity protection taxonomic information and the collection of biotic samples is conducted based on data from costa rica the results suggest that although a country can be adequately compensated for its investment in the generation of taxonomic information it is unlikely that pharmaceutical prospecting alone will cover the high opportunity costs of biodiversity protection

a characterization of the daily and intraday behavior of returns on options the daily and intraday behavior of returns on chicago board options exchange options is examined option returns contain systematic patterns even after adjusting for patterns in the means and variances of the underlying assets this is consistent with the hypothesis that informed trading in options can make the order flow in the options market informative about the value of the underlying asset making options nonredundant the intraday patterns in adjusted option return variances are further consistent with a model of strategic trading by informed and discretionary liquidity traders this paper examines the daily and intraday behavior of returns on options we have two goals our first objective is to identify systematic patterns in the means and variances of daily and intraday returns on options our second objective is to decompose option returns into patterns that are related to the means and variances of the underlying stocks and by inference those patterns that are independent of patterns in the means and variances of the underlying assets 1 our work is important for a number of reasons first options have become as important as common stocks yet there is no detailed investigation of the behavior of returns on options second it is important to identify similarities and differences in return patterns across different securities and market structures an understanding of these similarities and differences would allow us to develop better models of returns that capture these properties closely related to this it is instructive to examine option returns in light of the partial equilibrium models we use to value them specifically are the return patterns in options driven exclusively by the underlying stocks or do option returns contain patterns of their own identifying independent yet similar patterns in options returns may lead to an identification of factors that are common across two different market structures the new york

trade related intellectual property rights north south trade and biological diversity in the trade related intellectual property rights trips agreement of gatt 1 january 1995 it was agreed to harmonise intellectual property rights ipr on an international level and to include the option for patent protection for all life forms such as plants and animals article 27 3 b patenting however leads to considerable conflicts between international trade and protection of biological diversity which can be illustrated by the example of seed production we make use of a three stage game to show the strategic incentives for implementation of two different property rights regimes patents and farmers rights on competition and biodiversity we show that the southern government has no incentive to acknowledge international patents even if farmers rights do exist the northern producer will always dominate in the output market if patents are applied but without farmers rights biodiversity will not be maintained by the southern government thus total payoff of the northern firm is maximized if both ipr regimes are implemented however if only farmers rights are valid biodiversity will be maximal

regulation school and environment theoretical proposals and avenues of research abstract the article explores the relevance of a particular approach of the institutionalist movement regulation theory to deal with the relationship between the economy and the environment regulation theory which appeared in france at the end of the 1970s is mainly interested in macroeconomic issues in contrast until now it has tended to neglect environmental questions by taking several key concepts of this theory accumulation regime mode of regulation institutional forms we have sought to assess its significance vis a vis the environmental field more precisely from the perspective of establishing an environmental regulationist theory we propose considering the economic relation to the environment as the articulation of three forms a transhistorical form a general capitalist form and a specific capitalist form the latter being variable in capitalist time and space we give several illustrations of the variability of the relation to the environment depending on the different accumulation regimes and the different modes of regulation two principal avenues of research are proposed historical analyses for given economic areas and comparative analyses relating in particular to different capitalist areas

box spread arbitrage profits following the 1987 market crash real or illusory we examine market efficiency before and after the 1987 market crash using the box spread strategy implemented with european style s p 500 index spx options before the crash apparent arbitrage opportunities were rare and simulated trades were unprofitable assum ing a one minute execution delay after the crash apparent arbitrage opportunities were frequent and simulated trades were profitable even assuming a five minute execution delay our analysis makes the routine assumption that quotes are good until updated to construct a time series of prevailing quotes sampled at 30 second intervals if this assumption is valid then arbitrage profits were actually available if this assumption is invalid then such profits could have been illusory either scenario however implies that spx market effi ciency decreased following the crash prevailing price quotes repeatedly failed to satisfy the fundamental parity relation underlying the box spread

moral hazard and nonexclusive contracts we study equilibria for economies with hidden action in environments in which the agents contractual relationships with competing financial intermediaries cannot be monitored or are not contractible upon we fully characterize equilibrium allocations and contracts for such economies as well as discuss their welfare properties depending on the parameters of the economy either the optimal action choice is not sustained in equilibrium or if it is agents necessarily enter into multiple contractual relationships and intermediaries make positive profits even under free entry conditions the main features and implications of these environments are consistent with several stylized facts of markets for unsecured loans

between economic loss and social identity the multi dimensional cost of avoiding deforestation in eastern madagascar this paper exhibits the multiple dimensions of the cost of stopping the main driver of deforestation in madagascar slash and burn agriculture tavy as well as being a major component of the economic livelihoods of most local households living at the edge of forests tavy has been described by anthropologists as an important cultural practice in this paper we show that stopping tavy does not only entail an economic cost for local households the loss of the cultural dimension of tavy would come at an additional cultural cost for some our results suggest that a viable cessation of deforestation in madagascar would require going beyond simple compensation of the opportunity costs of avoiding deforestation

biodiversity poverty and development biodiversity is crucial for the production of a range of marketed and non marketed ecosystem goods and services this paper reviews the empirical evidence for the role of terrestrial biodiversity and biodiversity conservation in economic development and poverty at both the macro e g country and micro e g farm scales it first examines general relationships between biodiversity and economic development before showing how biodiversity influences ecosystem services second future scenarios and challenges for biodiversity and development are examined given projections for further changes in global population economic growth and consumption third the relationship between biodiversity protection and incomes is investigated two specific policies protected areas and bioprospecting are reviewed with respect to their impacts on the welfare of the resource dependent poor in conclusion improvements in policy design and implementation could help minimize the possibility of earth s sixth mass extinction event at least within a few generations while ensuring that the poor are not made worse off as a result of policy implementation

real indeterminacy with financial assets abstract it is shown that in a two period general equilibrium securities model where assets pay in money the generic dimension of the set of equilibrium allocations in the incomplete market situation is s 1 where s is the number of assets hence the degree or real indeterminacy is independent of the number of assets this result requires beyond fewer assets than states that the number of traders be larger than the number of securities and that the asset return matrix be in general position the generic dimension for arbitrary returns matrix is also obtained it is argued in addition that the presence of real or mixed assets does not by itself lower the degree of indeterminacy

the convention on biological diversity and agriculture implications and unresolved debates1 summary the convention on biological diversity addresses two controversies that surround plant genetic resources pgrs one debate has been over property rights governing pgrs and the distribution of benefits from their use the second has been over the adequacy of measures to maintain crop genetic diversity this paper examines how these two debates are linked and reviews previous multilateral attempts to address them the convention signals wider international acceptance of stricter property rights over pgrs and the need for multilateral assistance for pgr conservation however current proposals to implement the convention appear too limited in scope to achieve their stated conservation objectives while several areas of controversy remain these include debates over i intellectual property protection for biological inventions ii control over pgrs in international gene banks iii the international biosafety protocol regulating biotechnology iv mechanisms to finance pgr conservation and v the allocation of funds between in situ and ex situ conservation q 1998 elsevier science ltd all rights reserved

on the non neutrality of money with incomplete markets abstract in this paper we show that if markets are incomplete and there are nominal assets whose payoff is denominated in money monetary policy will be in general non neutral the mechanism through which monetary policy operates is a change in the structure of the rates of return by changing the level of money prices monetary policy affects the payoffs of nominal assets this differs from previous arguments for non neutrality we also show that a consideration of this effect of monetary policy may allow us to claim the superiority from a welfare point of view of a random money growth rate over a deterministic one journal of economic literature classification numbers d52 e50 g10

opportunism and ngos entrepreneurship and green north south transfers abstract through the lens of entrepreneurship this paper applies the new institutional economics to examine two case studies of environmental nongovernmental organizations ngos in latin america to clarify their political economic roles southern ngos that rely on northern donors are viewed as entrepreneurial economic entities producing international public goods these nonprofit ngos take their place alongside for profit firms as contributors to economic production employment institutional innovation and technology transfer the theoretical framework proposed assumes that self interested behavior coexists with loyalty commitment and altruism as well as opportunism

prospects for a heterodox economics of the environment and sustainability this paper introduces a special issue on heterodox economics of the environment and sustainability at present humanity faces several challenges such as resource scarcity biodiversity loss and climate change and yet we would argue contributions from traditional heterodox schools of thought such as post keynesianism marxism and to a lesser extent institutionalism have had relatively little to say about them instead the economic analysis of environmental issues has been dominated by approaches inspired by neoclassical economics and latterly by ecological economics the special issue is part of an effort to stimulate more heterodox work on the environment and to explore connections between existing groups of scholars particularly between ecological and heterodox economists

technology transfer licensing contracts and incentives for further innovation technology licensing is common in agricultural and natural resource sectors an important characteristic of technology licenses is that they provide incentives for further innovation on the part of the buyer this paper develops a risk sharing model to analyze how risk preferences and expectations about further innovation possibilities alter technology payments and the incentives for complementary local innovation higher buyer risk aversion which is associated with lower fixed payments reduces the technology buyer s level of innovation sellers are generally better off when innovation is anticipated but buyers are generally better off when innovation is unanticipated although less innovation may be realized

competition among exchanges does competition among e nancial intermediaries lead to excessively low standards to examine this question we construct a model where intermediaries design contracts to attract trading volume taking into consideration that traders differ in credit quality and may default when credit quality is observable intermediaries demand the right amount of guarantees a monopolist would demand fewer guarantees private information about credit quality has an ambiguous effect in a competitive environment when the cost of default is large small private information leads to higher lower standards we exhibit examples where private information is present and competition produces higher standards than monopoly does i introduction in spite of the general acceptance of the competitive mechanism as an allocation scheme many observers consider e nancial intermediation an exception competition is thought to lead to a race to the bottom in which e nancial intermediaries settle for excessively low levels of contractual guarantees in an attempt to increase volume evaluating futures exchanges a joint report from the treasury and the federal reserve board written in the wake of the 1987 crash states that t here is sufe cient possibility that at some point sros self regulatory organizations might establish margins that were inconsistent enough to present market problems or set them at levels that might present potential costs to other parties that regulatory approval should be established in all markets 1

nominal rigidities in wage setting by rational trade unions many rational wage setting schemes such as the trade unions paradigm are usually thought to lead to pure real rigidities in this article the author constructs a model where a rational trade union without any kind of money illusion sets wage schedules in an economy subject to real and monetary shocks he makes the realistic assumption that wages can be conditioned on prices it is found that although the trade union has the option of fully insulating workers from nominal disturbances it will rationally choose not to do so and therefore nominal rigidities will be present in the economy copyright 1995 by royal economic society

the october 1987 s p 500 stock futures basis five minute changes in the s p 500 index and futures contract are examined over a ten day period surrounding the october 1987 stock market crash since nonsynchronous trading problems are severe in these data new index estimators are derived and used the estimators use the complete transaction history of all 500 stocks nonsynchronous trading explains part of the large absolute futures cash basis observed during the crash the remainder may be due to disintegration of the two markets even after adjustment for nonsynchronous trading the index displays more autocorrelation than does the futures and the futures leads the index

arbitrage short sales and financial innovation the authors describe a model of general equilibrium with incomplete markets in which firms can innovate by issuing arbitrary costly securities when short sales are prohibited firms behave competitively and equilibrium is efficient when short sales are allowed these classical properties may fail if unlimited short sales are allowed imperfect competition may persist even when the number of potential innovators is large if limited short sales are allowed perfect competition may obtain in the limit but equilibrium can be inefficient because of the presence of an externality the private benefits of innovation for firms differ from the social benefits copyright 1991 by the econometric society

competition in financial innovation this paper examines the incentives to innovate securities provided by frictionless competitive markets with short sales to entrepreneurs in economies with symmetric investor utilities we provide the conditions under which a rm s market value is maximized by a complete nancial structure that is when the mechanism that gives rise to market incompleteness is the one illustrated in the classical example of allen and gale 1991 the foundation for incompleteness in that case is derived from innovation costs and free riding among entrepreneurs for the class of preferences where an incomplete nancial structure maximizes the rms market values markets are incomplete with a probability of one even when innovation is cost free in this sense we provide an alternative to allen and gale s foundation for market incompleteness

property rights genetic resources and biotechnological change it is well recognized that wild genetic resources the genetic constitutions of plants and animals have substantial social and economic value as repositories of genetic information today genetic information provides direct and indirect inputs into plant breeding programs the development of natural products including drugs and pharmaceuticals and increasingly sophisticated applications of biotechnology 2 recognition of the potential of wild genetic resources in the development of drugs has led the national cancer institute to initiate a massive plant collection project 3 which is a follow up to an earlier 1970s project that sought to identify drugs effective against a variety of cancers and to look at the immune system effects of various drugs it is estimated that 70 percent of the 3 000 species known to have anticancer properties are found in the tropical forests 4 in recent years a number of widely used drugs have been developed from plants including two important anticancer drugs derived from the rosy periwinkle found in tropical madagascar with the recent major breakthroughs in biotechnology the future potential of these resources seems limitless species that have no current commercial application have useful natural chemicals or are as yet undiscovered never

spillovers from high value agriculture for exports on land use in developing countries evidence from madagascar high value agriculture for exports is increasingly important in developing countries in a case study of contract farming for exports of vegetables from madagascar strong spillover effects of these trade opportunities on land use are found to exist using a matched plot sampling design the productivity of rice the main domestically consumed staple is shown to be two thirds higher on fields that were contracted during the off season for the production of vegetables this increase in yields is linked to an increase of soil fertility due to the application of fertilizer and compost which farmers did not use prior to the contracts although agricultural output goes up significantly labor productivity stays the same suggesting that there is greater labor absorption on existing land and the diffusion of this type of technology at a larger scale throughout madagascar would be expected to substantially decrease incentives to deforest by increasing wages and to boost productivity of existing lands relative to newly deforested ones

grassroots organizations and ngos in rural development opportunities with diminishing states and expanding markets abstract this article undertakes to deal systematically with nongovernment organizations ngos and grassroots organizations gros usually treated as a residual category ten levels for development decision making and action are identified in the tradition of central place theory three of these are considered local or grassroots because of their collective action possibilities then three sectors are delineated instead of the usual two ngos are part of the collective action sector which differs from the public and private sectors in theoretically consistent ways a careful distinction is made between institutions and organizations usually conflated in the literature examples of accelerated rural development through grassroots organizations and ngos are discussed form asia africa and latin america

the stork the plow rural social structure and tropical deforestation in poor countries abstract several authoritative sources attribute deforestation in poor countries to the actions of the rural poor others argue that this is tantamount to blaming the victim and directing attention away from the fundamental causes inequality in landholding tenure insecurity and landlessness of deforestation unfortunately there are no statistical tests of the impact of these rural political economy variables on deforestation this paper uses a model of deforestation based on rural household labor allocation decisions to empirically assess how those decisions interact with the structure of rural political economy to determine the extent of deforestation in poor countries cross country multiple regression equations suggest that policies to intensify smallholder agriculture can slow population movement to the agricultural frontier but regression results also show that this outcome depends on the degree of equality in the distribution of landholdings and the extent of rural rootlessness these findings have two important implications for public policy first they suggest that efforts to slow deforestation must start with an understanding of the behavior of the millions of small farmers who now deforest second they suggest that political economy interpretations of deforestation need to taken more seriously by those trying to conserve forested areas