sustainability as a fair bequest an evaluation challenge abstract in contrast to conventional approaches the conceptualisation of sustainability as fair bequest makes it possible to consider a finite time horizon valuation is necessary to determine whether the bequest package that is passed on from one generation to the next is fair acknowledging the merits as well as the limitations of economic price theory this paper differentiates between three classes of valuables the essential the useful and the unique it is argued that a fair bequest package should contain items from each of the classes because the three classes are incommensurable fairness of the bequest cannot be expressed by a single figure like a non declining total value of the package we then discuss which methods are appropriate for describing a bequest package with respect to its fairness

evolution of population resource dynamics models abstract this paper provides a comprehensive analysis of brander and taylor s 1998 model and its descendants from the following perspectives population growth substitutability innovation capital accumulation property rights and institutional designs and modeling approach this survey aims to contribute to a better understanding of population and resource dynamics models in general and facilitate further application of the model framework to relevant circumstances although often treated as exogenous in optimal growth models making population growth an endogenous function allows us to analyze broader effects of economic activities on population the issues of substitutability innovation and capital accumulation are intertwined allowing a model to address the effect of an endogenous technological change on substitutability between natural and man made capital facilitates our analyses of sustainability issues to address internalizing inter generational externalities in resource use incorporating property right changes and institutional designs to this type of model is a useful exercise but careful attention is needed for the consistency between such an arrangement and the mathematical representation of the depicted economy finally although the common criticism regarding convenient mathematical assumptions applies to the existing bt type models the use of computer simulation can relax such assumptions to better represent the intended relationships between the relevant variables

human and nature dynamics handy modeling inequality and use of resources in the collapse or sustainability of societies abstract there are widespread concerns that current trends in resource use are unsustainable but possibilities of overshoot collapse remain controversial collapses have occurred frequently in history often followed by centuries of economic intellectual and population decline many different natural and social phenomena have been invoked to explain specific collapses but a general explanation remains elusive in this paper we build a human population dynamics model by adding accumulated wealth and economic inequality to a predator prey model of humans and nature the model structure and simulated scenarios that offer significant implications are explained four equations describe the evolution of elites commoners nature and wealth the model shows economic stratification or ecological strain can independently lead to collapse in agreement with the historical record the measure carrying capacity is developed and its estimation is shown to be a practical means for early detection of a collapse mechanisms leading to two types of collapses are discussed the new dynamics of this model can also reproduce the irreversible collapses found in history collapse can be avoided and population can reach a steady state at maximum carrying capacity if the rate of depletion of nature is reduced to a sustainable level and if resources are distributed equitably

strategic pricing signalling and costly information acquisition abstract consider a market where an informed monopolist sets the price for a good or asset with a value unknown to potential buyers upon observing the price buyers may pay some cost for information about the value before deciding on purchases under a belief restriction which generalizes the idea of the cho kreps intuitive criterion we establish a version of the grossman stiglitz paradox there is no separating equilibrium with fully revealing prices yet we also resolve the paradox there is a unique equilibrium and as the cost of information becomes small the equilibrium approaches the full information outcome and prices become perfectly revealing

evolutionary theories in environmental and resource economics approaches and applications recent advances in evolutionary theory have important implications for environmental economics a short overview is offered of evolutionarythinking in economics subsequently major concepts and approaches inevolutionary biology and evolutionary economics are presented andcompared attention is devoted among others to darwinian selection punctuated equilibrium sorting mechanisms lamarckian evolution coevolution and self organization basic features of evolution such assustained change irreversible change unpredictability qualitativechange and disequilibrium are examined it is argued that there are anumber of fundamental differences as well as similarities betweenbiological and economic evolution next some general implications ofevolutionary thinking for environmental economics are outlined this isfollowed by a more detailed examination of potential uses ofevolutionary theories in specific areas of environmental economics including sustainability and long run development theories technologyand environment ecosystem management and resilience spatial evolutionand environmental processes and design of environmental policy

economics as a moral science economists frequently make judgments about economic welfare but there is today little discussion of the foundations of welfare economics it is assumed either that there is unanimity of interests or that there is general acceptance of utilitarianism this means that economics cannot address many key policy issues and that important differences in ethical views cannot be recognized this paper argues that it is a legitimate exercise of economic analysis to examine the consequences of different ethical positions taking case studies of employment as a macroeconomic objective and the role of capabilities in the measurement of economic performance

signalling product quality when is price relevant abstract price has long been regarded as performing a dual role in the demand for products with unknown quality it represents the opportunity cost of the product and is one of several signals which indicate quality we argue that when quality signals are stochastic not all of them will be used in particular there will be a critical price above below which price is used not used to signal quality at this price an individual s demand curve will be characterised by a reverse kink this helps explain recent results from demand analysis including those reported by abbe decarroux in this journal

trade ins mental accounting and product replacement decisions when a consumer who already owns a durable type product in a category faces the opportunity to upgrade to a new higher quality product the replacement purchase decision is driven by both normative economic factors and psychological factors as a normative decision maker s he considers the purchase price of the new alternative but s he additionally considers the mental cost of retiring the old product before s he has gotten his her money s worth out of it during ownership of a product a consumer mentally depreciates the initial purchase price thus creating a mental book value for the product the write off of this mental book value is felt as the mental cost of a replacement purchase based on the principles of mental accounting and mental depreciation i provide a theoretical explanation for this mental cost and why an individual s replacement purchase decision may be more sensitive to the mental cost than the marginal cost when applied appropriately mental accounting can serve a useful purpose

systemic crises in hierarchical ecological economies human beings are both the slaves and the masters of the ecosystems in which they live this paper examines the interrelationship be tween economic decision making hierarchies and ecological hierarchies conditions under which dis continuous changes can occur are presented both for top down and bottom up causes appropriate institutional arrangements for minimizing ecological disruption are analyzed and depend on the nature of the relationship between the economic and eco logical hierarchies in some cases this will involve self managed economic units operating at the ap propriate level of the ecological hierarchy jel q20

resource use institutions and sustainability a tale of two pacific island cultures this paper examines two pacific island cultures easter island and tikopia and the relationship between natural resource systems human made capital population growth and institutional change easter island followed a preindustrial society pattern of overshoot and collapse however tikopia evolved cultural practices leading to zero population growth and sustainable resource use using a modified lotka volterra predator prey model we find 1 investment in human made capital does not necessarily eliminate the boom and bust cycles of economic activity and population observed in many past societies and 2 institutional adaptation and resource conservation can be critical in achieving population stability

a complex systems approach to the value of ecological resources a theory of value sits at the core of every school of economic thought and directs the allocation of resources to competing uses ecological resources complicate the modem neoclassical approach to determining value due to their complex nature considerable non market values and the difficulty in assigning property rights application of the market model through economic valuation only provides analytical solutions based on virtual markets and neither the demand nor supply side techniques of valuation can adequately consider the complex set of biophysical and ecological relations that lead to the provision of ecosystem goods and services this paper sets out a conceptual framework for a complex systems approach to the value of ecological resources this approach is based on there being both an intrinsic quality of ecological resources and a subjective evaluation by the consumer both elements are necessary for economic value this conceptual framework points the way towards a theory of value that incorporates both elements so has implications for principles by which ecological resources can be allocated c 2005 elsevier b v all rights reserved

energy growth and evolution towards a naturalistic ontology of economics in recent years new approaches to the integration of economics and thermodynamics have been developed which build on the physics of open non equilibrium systems the so called maximum entropy production principle i review these contributions in the light of the implications for economic ontology i e the question what the fundamental constituents of real world economic phenomena are i argue in favor of the naturalization of economic ontology using the phenomenon of economic growth as my workhorse and i explore the implications for the cross disciplinary foundations of ecological economics the paper shows how economic growth can be conceived as a natural process that is driven by fundamental physical forces the argument proceeds in three steps after a short review of recent research on the linkage between energy and growth i establish the connection with bioeconomic theories about evolution that allow restating the role of lotka s maximum power principle mpp as a property of open non equilibrium flow systems with sufficient degrees of freedom of structural adaptation the mpp is then related to the recent literature on maximum entropy production mep especially as deployed in the earth sciences economic growth can be seen as resulting from evolutionary adaptations of flow gradients in economic systems that increase throughputs of exergy and generation of work and which thereby enhance the capacity of the earth system to maximize entropy production this framework offers fresh perspectives on a number of issues in research and policy which i discuss in the conclusion

economics and sustainability balancing trade offs and imperatives the concept of sustainability has been increasingly invoked in scholarly and public policy debates discussion has been hampered however by uncertainty and lack of uniformity in the meaning of sustainability this paper seeks to identify some common ground among economists ecologists and environmen tal ethicists two issues seem salient require ments for intergenerational and the defi nition of social capital to be provided to future generations a concept of safe minimum standard which has received at least some recognition in the ecology philosophy and eco nomics literatures may provide the beginnings of a common ground for debate about sus tainability jel q2

quality price advertising and published quality ratings economic literature contains several sometimes contradictory hypotheses concerning the relationships among quality price and advertising we investigate the impact of published quality ratings on these relationships and find that quality and advertising are much more likely to be positively related in the presence of quality ratings

ecological thresholds a survey abstract the existence of ecological discontinuities and thresholds has been recognised by ecological economics as a key feature to take into account in the study of environment economy interactions this paper reviews some theoretical developments and empirical studies dealing with ecological phenomena involving non linear dynamics the literature about this issue reveals that there is abundant evidence of discontinuities and threshold effects as the consequence of human perturbations on ecological systems however due to the complexities involved the predictive capacity of ecology is limited and large uncertainties still remain

getting more organs for transplantation the united states and most other nations suffer from a shortage of human organs for transplant in the united states over 120 000 people are on waiting lists for organ transplant and every year over 10 000 people die while waiting organ procurement and transplantation network there are a number of fronts on which research has made progress to address this shortage but there is still significant work to be done we describe how organs are acquired and allocated strategies that have been implemented to increase the number or organ donations for transplantation from living donors and work we are conducting to understand how we can recover more organs from deceased donors for example how organs are allocated can moderate their scarcity not just through efficiencies in allocation but also through changes in donor behavior we will describe a market design being explored in israel to increase organ donor registration by providing priority on organ waiting lists for individuals who previously registered as organ donors we will also report results that raise concern over policies that have recently been implemented in the united kingdom and several us states namely changing the way the organ registration question is asked to a mandated choice frame organs for transplant can be recovered from living donors and deceased donors living donors give an organ while alive living donation of kidneys which represented 96 per cent of all us living organ donations in 2012 optn is possible since humans have two kidneys but can live a healthy life with only one allowing the other to be removed and donated

on the intergenerational allocation of natural resources it is known hartwick and others that under standard assumptions a society that invests in reproducible capital the competitive rents on its current extraction of exhaustible resources will enjoy a consumption stream constant in time it is shown here that this result can be interpreted as saying that an appropriately defined stock of capital including the initial endowment of resources is being maintained intact and that consumption can be interpreted as the interest on that patrimony this seems like a useful rule of thumb for policy

indicators of sustainable development some lessons from capital theory abstract interest in sustainable development has prompted a search for suitable indicators that might complement or supplant the traditional measures of economic success although there is no agreement about the precise meaning of sustainable development one idea which is increasingly in good currency is that sustainable development requires that the stock of capital that one generation passes on to the next be maintained or enhanced further this stock of capital is seen by some to comprise two elements manufactured capital and natural capital the extent to which these are believed to be substitutes or complements is one factor which separates the neoclassical school from some of its critics a premise of this paper is that if capital theory is relevant to sustainable development then it should also be helpful in developing indicators however even within the normal confines of economics capital theory is not a homogeneous body of analysis therefore an exploration of capital theory and its relevance to sustainable development can be expected to generate various perspectives on those measures most useful for gauging the sustainability of economic activity it is these linkages between capital theory in various schools of thought and possible indicators of sustainable development that are the subject of this paper

critical natural capital revisited ecological resilience and sustainable development abstract the maintenance of critical natural capital is an important objective of sustainable development critical natural capital represents a multidimensional concept as it mirrors the different frameworks of various scientific disciplines and social groups in valuing nature this article revisits the concept of critical natural capital and examines its relation to the concept of ecological resilience i propose that ecological resilience can help a great deal in specifying the ecological criticality of specific renewable parts of the natural capital more specifically i suggest that the degree of ecological resilience is inversely related to the degree of threat ecosystems are prone to the concept of ecological resilience may complement other measures such as integrity or vulnerability in estimating the degree of threat specific ecosystems are exposed to the empirical estimates of ecological resilience add a further criterion in order to build a comprehensive and clear conception of critical natural capital

the effect of subsistence on collapse and institutional adaptation in population resource societies abstract we extend the brander taylor model of population and resource development in an isolated society by adding a resource subsistence requirement to people s preferences this improves plausibility amplifies population overshoot and collapse and can destabilize the steady state and allows for complete cessation of non harvesting activities in line with archaeological evidence for many societies we then use bifurcation techniques to give a global analysis of four types of institutional adaptation an ad valorem resource tax and quotas on total resource harvest total harvest effort and per capita effort in all cases we find that a higher subsistence requirement makes it harder or often impossible for adaptation to avoid overshoot and collapse

quality indicators in theory and in fact abstract in recent literature it has been suggested that consumers need have no knowledge of product quality as a number of quality indicators or signals may be used as substitutes very little attention has been paid to the empirical verification of these studies the present paper is devoted to the issue of how well these indicators perform using market data provided by consumer magazines from 3 countries the results strongly indicate that price is a poor quality indicator the paper also presents some evidence which suggests that seller reputation and easily observable characteristics are also poor indicators

national accounts and environmental resources in the paper optimal growth theory is used to derive the appropriate definition of the net national product concept when there are environmental resources and environmental damage to take into account the basic conclusions are that conventional defined np should be corrected by deducting environmental damage and adding the value of the net change of all resources

coupled societies are more robust against collapse a hypothetical look at easter island inspired by the challenges of environmental change and the resource limitations experienced by modern society recent decades have seen an increased interest in understanding the collapse of past societies modelling efforts so far have focused on single isolated societies while multi patch dynamical models representing networks of coupled socio environmental systems have received limited attention we propose a model of societal evolution that describes the dynamics of a population that harvests renewable resources and manufactures products that have positive effects on population growth collapse is driven by a critical transition that occurs when the rate of natural resource extraction passes beyond a certain point for which we present numerical and analytical results applying the model to easter island gives a good fit to the archaeological record subsequently we investigate what effects emerge from the movement of people goods and resources between two societies that share the characteristics of easter island we analyse how diffusive coupling and wealth driven coupling change the population levels and their distribution across the two societies compared to non interacting societies we find that the region of parameter space in which societies can stably survive in the long term is significantly enlarged when coupling occurs in both social and environmental variables

towards an ecological economics of sustainability abstract persistent disagreement both as to the interpretation to be given to sustainability and as to the relation between ecological and economic sustainability has hindered the development of an ecological economics of sustainable resource use this paper identifies the main concepts of sustainability deriving from the two disciplines in order to explore the difference implied by an ecological approach to the problem it is argued that present economic and ecological approaches are largely disjoint and that they address basically different phenomena by combining the efficiency requirements of what is usually thought of as economic sustainability with the stability requirements of an ecological approach it is shown that an intertemporally efficient allocation of resources that satisfies the conditions for constant levels of consumption is not necessary to assure ecological sustainability ecological sustainability requires that the allocation of economic resources should not result in the instability of the economy environment system as a whole

valuing environmental functions tropical wetlands recent studies have suggested that tropical wetland systems may have a crucial economic role to play in development the following paper provides an overview of these benefits using the general framework of cost benefit analysis as the methodological approach to assessing wetland values an analysis of trade offs between conserving or converting tropical wetlands demonstrates that taking into account the opportunity cost of wetland loss leads to a lower level of conversion than would otherwise be the case finally the paper discusses the extensions and limitations of the production function approach as applied to valuing nonmarketed wetland benefits

the price of a price on the crowding out and in of social norms we study the impact of financial incentives on social approval showing that in a society with altruists and egoists who all care about social approval introducing financial incentives to agents to contribute to a socially desirable outcome may actually decrease the number of contributions withdrawing the financial incentive does not restore the norm to contribute and may reduce the level of contributions even further when the norm has disappeared it may be possible to restore voluntary contributions by first introducing high price and then reducing it but such an operation is costly and its success uncertain

entitlements missing markets and environmental uncertainty reply abstract at one level dore and ward seem intent on immunizing received doctrine they say that i did not prove that rights violated nozick s principles of justice and that i did not prove that missing markets were the problem more telling they allege i did not prove that my story was better than the particular story favored by dore and ward that is they argue that there is an alternative approach based on the theory of public economics which is indeed operational 3 they then use the bulk of their comment to explain and defend this alternative model they hope to convince the reader that the model of public economics survives intact in the face of my alternative model to the extent that their model allows one to define the problem away it is not difficult to see why they find it so compelling more seriously dore and ward fail to make a coherent argument about the concept of rights and duties and the logic of a particular rights structure that happens to prevail they seem concerned that my article was tampering with some sacred social construct the status quo rights structure and that my article threatened the received wisdom of both public economics and paretian walrasian bliss indeed theirs seems to be a genuine fear that if economists release their grip on the certitude of received orthodoxy the floodgates will be open to all manner of bumbling regulators seeking to shift rights and wealth positions across generations my article is apparently threatening because it seems to suggest that the received wisdom may at times be misleading

institutional ecological economics abstract new institutional economics and its forerunners have we argue made important contributions to the evolving agenda of ecological economics the conceptualisation of environmental problems as instances of interdependence and the acknowledgement of positive transaction costs are key insights into the nature of environmental problems we also discuss how plurality of behavioural motivations and limited cognitive capacity have important implications for environmental decision making and its analysis we show how evolutionary and collective action theories offer complementary takes on the choice and change of environmental governance institutions and how the concept of social capital can enrich analyses of environmental governance we conclude that an emerging institutional ecological economics has the greatest relative advantage in analysing the design implementation and effectiveness of environmental governance solutions

when individual preferences defy sustainability can merit good arguments close the gap in this paper we discuss how merit good arguments may contribute to discussions about sustainability to this end we clarify how merit good arguments deviate from individual preferences and relate the justification for deviations from individual preferences to two conceptions of well being an informed preference satisfaction and a perfectionist conception building on this framework we analyze how merit good arguments can be helpful for discussing sustainability as justice what challenges merit good arguments pose to future generations and whether they can serve as a normative justification for green nudges the analysis yields two main insights first a reflection on the concept of merit goods is helpful in sorting out the different justifications that sustainability interventions may rely on in particular it allows separating the challenges of redistribution internalization of externalities and increasing individual consumption of particular merit goods such as health care or education more clearly second the precise notion of merit goods by itself however only offers a limited contribution and does not represent a blank check to justify deviations from individual preferences

optimal diversity increasing returns versus recombinant innovation abstract choices regarding diversity play an important role in economics and innovation management but often remain implicit once made explicit the objectives of efficiency and diversity are usually posed as in conflict as efficiency relates positively and diversity negatively to various increasing returns to scale in markets such a perspective however neglects the benefits of diversity in terms of realizing system improvements through recombinant innovation or spillovers the latter implies a contribution of diversity to long term efficiency dominant economic approaches that address diversity such as option value and real options theories regard benefits of diversity as exogenous this paper proposes a simple model of variable endogenous diversity to analyse the optimal balance between increasing returns to scale and recombinant innovation it is discussed under which conditions one of four solutions is optimal complete specialization regardless of which option complete specialization in one specific option symmetric diversity perfect balance and asymmetric diversity the results give rise to a number of policy insights

if you tourist behave irrationally i ll find you abstract when departures from rational behavior can potentially be expected modeling should allow for their identification and their quantification in this regard prices in tourism might have effects that may not be as apparent as economic theory predicts this article incorporates the sticker shock formulation into the mixed logit model without imposing consistency with consumer theory to accommodate any possible positive or negative price effects by allowing the parameters of price and sticker shock term to take any value negative or positive we detect abnormal behaviors in the tourist demand not only is the negative relationship between price and demand inverted for some people but also some tourists might be willing to accept higher than expected prices the non well behaved groups shares are estimated

problems in valuing the benefits of biodiversity protection this paper considers two problems in valuing the benefits of biodiversity protection these are firstly that preferences for biodiversity protection may be lexicographic rather than utilitarian the more individuals for whom this is true the less is cost benefit analysis validated as a means of decision making for biodiversity protection since lexicographic preferences are incompatible with the kaldor hicks compensation test secondly people may be poorly informed about the meaning of biodiversity complicating the use of contingent valuation as a means of measuring preservation benefits this paper first discusses the meaning of biodiversity and trends in diversity over time we offer some empirical evidence with regard to lexicographic preferences consider the implications of having poorly informed consumers and then report the results of a contingent valuation study of biodiversity protection with varying levels of information we find that willingness to pay for biodiversity protection increases with the level of information provided

price and advertising signals of product quality we present a signaling model based on ideas of phillip nelson in which both the introductory price and the level of directly uninformative advertising or other dissipative marketing expenditures are choice variables and may be used as signals for the initially unobservable quality of a newly introduced experience good repeat purchases play a crucial role in our model a second focus of the paper is on illustrating an approach to refining the set of equilibria in signalling games with multiple potential signals

trust law sustainability and responsible action abstract the problem of managing for sustainability is marked by the need to make decisions on behalf of others and by the uncertainties that attend such decisions however the economic literature on sustainability has paid scant attention to how decisions on behalf of others might differ from decisions on behalf of oneself and when risk has been modeled explicitly the expected utility hypothesis has generally been used a generation acts sustainably if the expected value of the next generation s utility is not less than the present s this paper investigates how we think about responsibly acting on another s behalf by looking to the united states law of trusts because in important respects the current generation views its responsibility to the future as a trust relationship trust law illuminates responsible decision making under both risk and uncertainty even under conditions of risk more conservative action than would be suggested by the expected utility hypothesis is warranted because it emphasizes preservation of trust principal and disavows profit maximization trust doctrine indicates that special caution should be exercised in conditions of uncertainty finally resource economic concepts of strong sustainability the precautionary principle and the safe minimum standard of conservation are interpreted according to trust principles

alternative approaches to economic environmental interactions abstract the key questions raised by recent developments in resource and environmental economics have been what useful economic functions does the environment provide and how are these functions affected by the process of economic environmental interaction this paper distinguishes between two different formal approaches to answering these questions the more conventional approach which is concerned with the optimal allocation of economically valuable exhaustible resources and an alternative analysis that considers the trade off between on the one hand environmental quality and on the other resource depletion and waste generation by the economic process to illustrate and extend the latter approach a model is constructed to show how this trade off might lead to continuously declining environmental quality and a future ecological constraint society must therefore optimally allocate output between consumption and services to improve the environment and choose between increased capital accumulation and environmental degradation although strict application of such a model may be limited it has wider implications for the role of technological change and the value of the environment in any system experiencing deteriorating environmental quality

historical roots for ecological economics biophysical versus allocative approaches abstract a number of economists today are aware that the results of their science are more or less at variance with concrete fact and are alive to the necessity of perfecting it they go wrong rather in their choice of means to that end they try obstinately to get from their science alone the materials they know are needed for a closer approximation to fact whereas they should resort to other sciences and go into them thoroughly not just incidentally for their bearing on the given economic problem until economic science is much farther advanced economic principles are less important to the economists than the reciprocal bearings of the results of economics and the results of the other social sciences many economists are paying no attention to such interrelations for mastery of them is a long and fatiguing task requiring an extensive knowledge of facts whereas anyone with a little imagination a pen and a few reams of paper can relieve himself of a chat on principles pareto 1935 para 2022

reframing the moral limits of markets debate social domains values allocation methods what should and what should not be for sale in a society this is the central question in the moral limits of markets mlm debate which is conducted by a group of business ethicists and liberal egalitarian political theorists these mlm theorists which we will dub market moralists all put forward a specific version of the argument that while the market is well suited to allocate some categories of goods and services it is undesirable for the allocation of other such categories we argue that the current mlm debate is too much framed in terms of a market non market dichotomy moreover authors tend to distinguish insufficiently between values such as freedom equality and efficiency and allocation methods such as the market the queue and rationing we introduce a new conceptual scheme consisting of societal domains values and allocation methods to provide a better structure for this debate the argument is illustrated from the education and healthcare domains

resilience weather and dynamic adjustments in agroecosystems the case of wheat yield in england the paper presents an investigation of agroecosystem dynamics with an application to wheat yield data in england over the period 1885 2012 the analysis relies on a threshold quantile autoregressive model the model allows for lag effects to vary across quantiles of the distribution as well as with the values taken by the lagged variables the analysis documents the dynamics and persistence of yield adjustments to shocks the estimates indicate the presence of dynamic instability in the lower quantile of the distribution the analysis shows that after controlling for the role of technological trend wheat yield exhibits resilience to adverse weather shocks

the deadweight loss of christmas when economists comment on holiday gift giving it is usually to condone the healthy effect of spending on the macroeconomy however an important feature of gift giving is that consumption choices are made by someone other than the final consumer a potentially important microeconomic aspect of gift giving is that gifts may be mismatched with the recipients preferences in the standard microeconomic framework of consumer choice the best a gift giver can do with say 10 is to duplicate the choice that the recipient would have made while it is possible for a giver to choose a gift which the recipient ultimately values above its price for example if the recipient is not perfectly informed it is more likely that the gift will leave the recipient worse off than if she had made her own consumption choice with an equal amount of cash in short gift giving is a potential source of deadweight loss this paper gives estimates of the deadweight loss of holiday gift giving based on surveys given to yale undergraduates i find that holiday gift giving destroys between 10 percent and a third of the value of gifts while these recipients may be unrepresentative of the u s population their gifts are not necessarily unrepresentative holiday expenditures average 40 billion per year implying that a conservative estimate of the deadweight loss of christmas is a tenth as large as estimates of the deadweight loss of income taxation i also explore how deadweight loss and the tendency to give cash gifts vary with the relationship and age difference between giver and recipient i find that gifts from friends and significant others are most efficient while noncash gifts from members of the extended family are least efficient and destroy a third of their value i develop a simple expected utility model to explain the decision to give cash as opposed to in kind gifts the data are consistent with the model cash gifts are most common from the sorts of givers whose noncash gifts have the lowest expected value to recipients given their cost and high variability in recipient valuation

sustainability constraints versus optimality versus intertemporal concern and axioms versus data sustainable sustained or survivable development are defined here as distinct sustainability constraints on intertemporal distribution in a context which ignores uncertainty environmental and intratemporal concerns such constraints are neither self contradictory nor redundant for they can conflict with maximizing the present value of utility optimality nor inferior since the axioms underlying optimality are ethically arbitrary and refuted by empirical psychological data axiomatic arguments may clarify but cannot resolve debates about intertemporal concerns data suggest that sustainability constraints are not respected and that intertemporal welfare functions containing a preference for sustained improvement may better reflect what bodies politic mean by sustainability

the paretian liberal paradox and ecological economics abstract two of the most basic considerations in collective choice are the pareto principle and some minimal protection of individual rights in his impossibility theorem sen 1970 shows that there is a potential inconsistency between preference sovereignty as expressed by the pareto condition and the protection of minimal rights a liberal or liberty condition the paretian liberal paradox plp and the extensive debate surrounding it prompts serious reconsideration of the traditional welfare economics approach the critique of welfarism made by the plp is of central importance for environmental issues given pervasive externalities missing markets uncertainty and potential irreversibilities making collective choice decisions on these issues may require using explicit non utility information and restricting individual preference sovereignty we explore the implications of the plp for long term environmental policy and the transdisciplinary field of ecological economics as a simple pedagogical device relying on sparse principles the plp stimulates an increased awareness of the potential conflict between preferences and rights recognition of the plp focuses attention on what counts as admissible information in collective choice rules for example consideration of the plp illuminates differences in the informational requirements of alternative sustainability concepts

the conditions for achieving environmentally sustainable development this paper is interested in the narrower interpretation the relationship between environmental quality and sustainable economic activity the latter is interpreted as that level of economic activity which leaves the environmental quality level intact with the policy objective corresponding to this notion being the maximization of net benefits of economic development subject to maintaining the services and quality of natural resources over time 3

limits to substitution and irreversibility in production and consumption a neoclassical interpretation of ecological economics abstract there are many methodological approaches within ecological economics one of the principal modes of analysis is a modified version of the standard neoclassical model this paper examines the parallels which emerge between the ideas of some ecological economists concerning production and the ideas of others concerning consumption when these ideas are interpreted in the neoclassical paradigm it is well known that ecological economics is characterized by arguments concerning limits to substitution between inputs energy natural capital etc vs manufactured capital labor etc in production and the implications these have for sustainability however various authors have also expressed concerns regarding limits to substitution in consumption either between environmental assets and other goods or between basic needs commodities and other goods though the specific reasons for non substitution are different in the production and consumption cases the underlying theme is that individual commodities and other inputs have unique physical or other properties which make them poor substitutes ideas about irreversibility in production and economic development are also prominent in ecological economics likewise many authors have argued for similar irreversibilities in consumption behavior in analogy to the term technological change i coin the term preferential change to describe these phenomena the linking themes in this case are that the economy environment system is evolutionary in character and that external effects intended and unintended consequences of actions or processes imposed on other parties or resources are all pervasive

market reasoning as moral reasoning why economists should re engage with political philosophy abstract in my book what money can t buy the moral limits of markets 2012 i try to show that market values and market reasoning increasingly reach into spheres of life previously governed by nonmarket norms i argue that this tendency is troubling putting a price on every human activity erodes certain moral and civic goods worth caring about we therefore need a public debate about where markets serve the public good and where they don t belong in this article i would like to develop a related theme when it comes to deciding whether this or that good should be allocated by the market or by nonmarket principles economics is a poor guide deciding which social practices should be governed by market mechanisms requires a form of economic reasoning that is bound up with moral reasoning but mainstream economic thinking currently asserts its independence from the contested terrain of moral and political philosophy if economics is to help us decide where markets serve the public good and where they do

tough love and intergenerational altruism this chapter develops and studies a tough love model of intergenerational altruism we model tough love by modifying the barro becker standard altruism model in two ways first the child s discount factor is endogenously determined so lower childhood consumption leads to a higher discount factor later in life second the parent evaluates the child s lifetime utility with a constant high discount factor our model predicts that parental transfers will fall when the child s discount factor falls this is in contrast with the standard altruism model which predicts that parental transfers are independent of exogenous changes in the child s discount factor