the effect of food stamps on labor supply a bivariate selection model abstract although there is a large literature on the effects of u s transfer programs on labor supply this is the first such study of the food stamp program we model the nonlinearity and nonconvexity of the budget constraint and use maximum likelihood methods to estimate hours of work functions for female heads of household the largest recipient group in the program we also model the joint response to afdc and food stamps and we account for the existence of a significant number of eligible households who do not participate in the programs a three equation bivariate selection model is estimated on a sample of eligible households with maximum likelihood

the effect of income taxation on labor supply in the united states the effect of income taxation on the labor supply of prime age married men and women in the united states is examined using econometric methods similar to those used in the influential work of jerry hausman male labor supply is found to be relatively invariant to the net wage and virtual income in all specifications estimated the estimated impact of taxation on the labor supply of married women depends critically on the method used to estimate the labor supply function estimated net wage and virtual income elasticities are considerably larger when data on nonparticipants are included than when the estimation is conducted conditional on hours being greater than zero

olson s exploitation hypothesis in a public good economy a reconsideration since the publication of olson s 1965 the logic of collective action the exploitation hypothesis in which the rich shoulder the provision burden of public goods for the poor has held sway despite empirical exceptions to address such exceptions we establish two alternative exploitation hypotheses based on contributors asymmetric preferences or on their productivity differences regarding the public good the classic hypothesis and its two variants are proven in a novel fashion for asymmetric preferences we also establish the exploitation hypothesis for the joint products model with private and public co benefits our theoretical insights are then illustrated by some empirical examples from the field of international public goods such as military defense and cross border pollution

the econometrics of kinked budget constraints in the last several years a branch of applied econometrics has developed which is devoted to the development of techniques for the estimation of demand and other functions when the budget constraint is piecewise linear or kinky that is when the constraint consists of a number of segments joined together at kink points such constraints most frequently arise from government tax and transfer programs for example the federal income tax imposes a piecewise linear schedule by the use of constant marginal tax rates within brackets a problem analyzed by hausman 1981 the payroll tax in the social security system likewise generates a kinked schedule inasmuch as the marginal tax rate on earnings is zero above a certain earnings maximum federal and state transfer programs for the poor result in piecewise linear constraints because transfer benefits are taxed in the sense of a negative income tax as income rises and because that tax rate falls to zero at the kink point where an individual or family loses eligibility for the benefit altogether many government transfer programs impose additional nonlinearities by altering this tax rate by discrete amounts over the range of positive benefits as well but kinked constraints sometimes arise in nongovernment contexts a well known example being the block pricing schedule commonly set by utilities and volume discounting in general kinked budget constraints create two difficulties that have several interesting facets one difficulty is that changes in tax and transfer schedules can have unexpected effects that can be exactly the opposite in sign to those expected from economic theory examples of this phenomenon are given below the second difficulty that with which this paper is mostly concerned relates to the implications of kinked budget

are entrepreneurs decisions more biased an experimental investigation of the susceptibility to status quo bias abstract entrepreneurship research has demonstrated that entrepreneurs are more susceptible to certain cognitive biases than are selected other individuals we investigate whether this finding holds for the status quo bias not yet investigated in the entrepreneurship literature the status quo bias is defined as the tendency to select a previously chosen alternative disproportionately often we compare entrepreneurs decisions with those of students and bankers in an experimental study we find that entrepreneurs are as affected by the status quo as students but less affected than bankers accounting for differences in experience and types of decision scenarios we have indirect evidence for a consistency of entrepreneurs decisions with what would be expected from a stereotypical schumpeterian entrepreneur being more open to new options than other individuals are however since entrepreneurs are frequently influenced by the status quo we discuss the pros and cons of such behavior

the voluntary provision of a pure public good the case of reduced cfc emissions and the montreal protocol abstract this paper applies the theory of the voluntary provision of a pure public good to the behavior of nations to curb chlorofluorocarbon cfc emissions during the late 1980s by devising an empirical test we determine that these cutbacks in emissions are consistent with nash behavior when taste parameters are controlled the relationship between emission cutbacks and national income is nearly linear as implied by the theory if the sample is purged of potential outliers then the linear relationship results a significant taste parameter is the extent of political and civil freedoms while a marginally significant parameter is geophysical position in terms of latitude

the estimation of a joint wage hours labor supply model in this paper the standard cross sectional static model of labor supply is modified to make the wage endogenous and a joint wage hours model is estimated the econometric technique addresses the non linearity of the budget constraint by approximating the constraint by a series of discrete points the results show that the budget constraint is indeed nonlinear that hours affect the wage quadratically that true wage elasticities are lower as a result and that the model fits the hours distribution much better than the standard tobit model

identifying the free riders a simple algorithm for determining who will contribute to a public good abstract when a heterogeneous group of people provide themselves with a pure public good the resulting nash equilibrium outcome will divide the group into contributors and free riders this paper proposes a general algorithm for discovering which individuals in the group fall into which of these two classes the algorithm is based on identifying for each individual how much of the public good must be provided by others to drive that individual s contribution to zero

how income transfer programs affect work savings and the income distribution a critical review for helpful comments on earlier drafts we thank without implicating moses abramovitz yves balcer john bishop alan blinder richard burkhauser michael darby irwin garfinkel alan gustman daniel hamermesh martin holmer george jakubson robert lampman paul menchik robert moffitt michael murray joseph quinn timothy smeeding eugene smolensky barbara wolfe and two anonymous referees

simultaneously modeling the supply of weeks and hours of work among female household heads this paper explores the differential nature of labor supply decisions regarding weeks of work per year and hours of work per week among female household heads a model of labor supply that separates the weeks hours decision is presented and estimated allowing for simultaneity in the weeks hours decision as well as for the presence of either fixed costs or weeks and hours constraints the results indicate that not only are weeks and hours decisions separate from the labormarket participation decision but they are also quite different from each other although they appear to be simultaneously determined

pure public goods versus commons benefit cost duality sandler and arce 1 pure public goods versus commons benefit cost duality by todd sandler school of international relations university of southern california von kleinsmid center 330 los angeles ca 90089 0043 tsandler usc edu 213 740 9695 213 742 0281 fax and daniel g arce m department of economics rhodes college 2000 n parkway memphis tn 38112 1690 arce rhodes edu 901 843 3121 901 843 3736 fax final revision november 2002 sandler is the robert r and katheryn a dockson professor of international relations economics university of southern california and arce is the robert d mccallum distinguished professor of economics business rhodes college sandler s and arce s research was funded through the dockson and mccallum endowments respectively we have profited from the helpful comments of two anonymous referees

employment contracts job search theory and labour turnover preliminary empirical results summary the empirical implications of a model in which a worker participates in a labour market in which a job offer consists of a wage hour pair are examined here hours are not freely adjustable and the wage rate is typically different from the marginal value of leisure a theoretical model is proposed some natural conjectures on effects of wage changes are shown not to hold and a preliminary empirical investigation based on denver income maintenance experiment data is undertaken the persistence of business cycles has led economists to consider explicitly potential sources of stickiness in wage and price adjustments particularly stickiness of nominal wages one explanation of slow adjustments of wages to shocks is that information arrives too rapidly with too much volatility or too much asymmetry for workers wages and hours to adjust so that the worker s wage is always equal to the value of his marginal product of labour and simultaneously to his marginal value of leisure time to avoid continuous adjustment workers and firms engage in implicit or explicit employment contracts azariadis 1975 modelled underemployment equilibria in a model with contracts baily 1977 studied a model in which certain fixed costs induce layoffs as firms respond to demand fluctuations more recent work by burdett and mortensen 1980 has considered the terms of equilibrium contracts in the labour market hart 1983 reviews the theory of optimal employment contracts emphasizing the role of asymmetric information fischer 1977a and implicitly phelps and taylor 1977 considered the effects of multiperiod contracts in dynamic macroeconomic models and found that certain policy neutrality results of the new classical macroeconomics could be invalidated under certain conditions it is worth mentioning at this point that keynes clearly recognized that the link between the real wage paid to workers and the value of their leisure time had to be broken before macropolicy of the keynesian type would be effective indeed keynesian macroeconomic problems arise because this link is broken keynes repeatedly refers to nominal wage bargains as providing the rigidity he wanted to model the importance of implicit or explicit employment agreements in economic theory has led to a small number of empirical studies which explicitly allow for divergence between the wage keynes 1936 ch 2 and 18 malinvaud 1977 provides a related discussion in some models contracts serve only to introduce a somewhat arbitrary rigidity barro 1977 notes that rational agents are unlikely to write contracts the provisions of which make all parties worse off see also the comment by fischer 1977b

why do only the g7 2 countries among united nations members discuss about international public goods a simulation study abstractthis article investigates why only the group of 7 plus china and russia g7 2 countries among 194 united nations members discuss about international public goods by simulating the heterogeneity of income prices and preference parameters on the total provisions and the number of free riders we find that the number of contributors for international public goods is 15 under the 194 member countries while the others are free riders in addition the contributors are the top 15 powerful countries with largest dropout value over the world then the discussion with only 15 countries for public goods is meaningful as large as the heterogeneity of parameters is the number of contributors becomes closer to g7 2

married women in part time employment this research deals with three aspects of the part time employment pattern of working wives 1 the wives characteristics 2 the level and structure of their earnings in part time jobs and 3 the duration of their employment when part time jobs are available to them this study improves upon previous research by using multivariate analysis to determine if the variation in the incidence of part time work consistently found in other studies persists when earnings potential fertility family income and other factors that may vary by age or race are held constant it differs further by including a data source that contains direct measures of market wages and experience for a large sample of married working women the authors find that husband s income family size and the wife s health race and previous work experience are among the variables that influence the probability that the wife works part time they also find that the level of wages and returns to some investments in human capital are rela

the econometrics of piecewise linear budget constraints a survey and exposition of the maximum likelihood method in this article maximum likelihood techniques for estimating consumer demand functions when budget constraints are piecewise linear are exposited and surveyed consumer demand functions are formally derived under such constraints and it is shown that the functions are themselves nonlinear as a result the econometric problems in estimating such functions are exposited and the importance of the stochastic specification is stressed in particular the specification of both unobserved heterogeneity of preferences and measurement error econometric issues in estimation and testing are discussed and the results of the studies that have been conducted to date are surveyed

female labor supply with a discontinuous nonconvex budget constraint incorporation of a part time full time wage differential this paper incorporates the well documented part time full time wage differential into an empirical labor supply model with both a heterogeneity and a random error term and estimates that model fo

the sensitivity of an empirical model of married women s hours of work to economic and statistical assumptions this study undertakes a systematic analysis of several theoretic and statistical assumption s used in many empirical models of female labor supply using a singl e data set psid 1975 labor supply data the author is able to replic ate most of the range of estimated income and substitution effects fo und in previous studies in this field he undertakes extensive specif ication tests and finds that most of this range should be rejected du e to statistical and model misspecifications the two most important assumptions appear to be the tobit assumption used to control for sel f selection into the labor force and exogeneity assumptions on the wi fe s wage rate and her labor market experience copyright 1987 by the econometric society

the econometrics of nonlinear budget sets traditional empirical analysis of consumer demand has usually made the assumption of linear budget sets that is the consumer is assumed to purchase any desired quantity at a constant price subject to a budget constraint the major exception to this framework is the analysis of demand when some goods are rationed 2 in the rationed case the price is constant up to a quantity limit in contrast to the rationed case here i consider the situation where the price varies with the amount of the good purchased empirical situations with nonconstant prices come readily to mind and of course they have received much recent attention from theorists since mirrlees 44 paper on optimal nonlinear taxation the following examples are meant to give a partial listing of cases when nonlinear budget sets occur i electricity prices many electric utilities engage in declining block pricing that is the marginal price of successive kwh s of electricity decrease at a given number of points determined by total demand thus the budget set is piecewise linear houthakker 36 was the first to propose an approach to this problem taylor 51 analyzes the problem at length and hausman kinnucin and mcfadden 31 use an instrumental variables estimator to provide consistent estimates of the demand function

united nations global compact the promise performance gap the united nations global compact ungc was created in 2000 to leverage un prestige and induce corporations to embrace 10 principles incorporating values of environmental sustainability protection of human rights fair treatment of workers and elimination of bribery and corruption we review and analyze the gc s activities and impact in enhancing corporate social responsibility since inception first we propose an analytical framework which allows us to assess the qualities of the ungc and its principles in the context of external and internal elements that influence code effectiveness and implementation second we analyze ungc performance in encouraging companies to become signatory members and bring about demonstrable change in corporate csr sustainability activities in its 10 year report ungc has proclaimed growth in both membership and program activity however all credible and publicly available data and documentation conclusively demonstrate that the ungc has failed to induce its signatory companies to enhance their csr efforts and integrate the 10 principles in their policies and operations the result has been a loss of public trust and support of ungc from important constituencies among civil society organizations and those individuals and groups adversely impacted by corporate activities and resultant negative externalities this diminished credibility has also made ungc largely dependent on the corporate sector for its very survival we conclude that this dependence has in turn impaired and would continue to hinder ungc s ability to fulfill its mission such an outcome raises serious questions as to the viability usefulness and continued existence of ungc

assessing the impact of management buyouts on economic efficiency plant level evidence from the united kingdom we assess the total factor productivity of 35 752 manufacturing establishments before and after management buyouts mbos mbo plants are less productive than comparable plants before the transfer of ownership they experience a substantial increase in productivity after a buyout which appears to be due to measures undertaken by new owners to reduce the labor intensity of production via outsourcing of intermediate goods and materials these findings which are pervasive across industries imply that mbos reduce agency costs and enhance economic efficiency our evidence is consistent with jovanovic and rousseau 2002 who suggest that ownership changes shift resources to more efficient uses and to better managers

analysis of part time pay in canada this paper analyses the difference between part time and full time wages in canada using the 1981 survey of work history since part time and full time workers are distinguished by hours worked and since hours worked and wages are interdependent selectivity bias occurs if ordinary least squares regression is used a modification of heckman s procedure to account for the fact that part time hours are doubly truncated is used to correct this problem the results indicate that adjusting for differences in characteristics the wage differential between part time and full time workers is 10 per cent or one third the unadjusted differential results vary somewhat by sex and marital status analyse de la remuneration du travail d temps partiel au canada ce memoire analyse les differences entre les salaires pour le travail a temps plein et a temps partiel au canada a partir des resultats de l enquete sur l activite en 1981 puisque les travailleurs a temps plein et a temps partiel sont definis par le nombre d heures de travail et puisque le nombre d heures de travail et les niveaux de salaire sont interdependants il y a biais de selectivite quand on utilise la methode des moindres carres ordinaires dans l analyse de regression l auteur utilise une modification de la technique de heckman pour tenir compte du fait que le nombre d heures de travail a temps partiel est doublement tronque pour corriger le probleme les resultats montrent que apres avoir tenu compte des differences dans les caracteristiques des personnes on observe un differentiel de niveau de salaire de 10 pourcent entre les travailleurs a temps plein et a temps partiel soit le tiers du differentiel brut avant les ajustements pour tenir compte de caracteristiques differentes ces resultats varient quelque peu selon le sexe et selon la situation familiale the trend towards part time employment has generally escaped the attention and scrutiny of economists part time employment in canada grew at an annual rate of 4 1 per cent between january 1972 and january 1984 compared 1 one exception is nakamura and nakamura 1983 who examine related labour supply issues for married females canadian journal of economics revue canadienne d economique xix no 4 november novembre 1986 printed in canada imprim6 au canada 0008 4085 86 798 807 1 50 0 canadian economics association this content downloaded from 207 46 13 159 on sat 22 oct 2016 04 29 38 utc all use subject to http about jstor org terms analysis of part time pay in canada 799 with a growth rate of only 2 4 per cent for full time employment as a result 15 4 per cent of jobs were part time as of january 1984 compared with 13 per cent in january 1972 2 the growth of part time employment raises a number of issues in particular labour canada 1983 argues that the hourly wage differential between full time and part time workers reached 26 3 per cent in 1981 it is not clear however that this gross wage differential between full time and part time workers is a useful figure a number of accepted measurable characteristics that determine wage differentials among workers may confound this comparison unless full time and part time workers have identical characteristics it would therefore be useful from a policy standpoint to eliminate these effects to identify part time effects and the gravity of the part time pay problem per se this paper analyses the differences between part time and full time wages to try to distinguish part time effects whatever the source from other established bases for differentials in the first section a standard model for wage comparison among workers is considered the source of selectivity bias is identified and a consistent estimation technique is described the second section uses this technique to analyse the differences in part time and full time wages using microdata from the 1981 survey of work history used by labour canada 1983 the third section summarizes the results and provides suggestions for further research a model for wage comparison with selectivity bias consider a standard model used extensively for union and non union wage comparisons lee 1978 duncan and leigh 1980 robinson and tomes 1984 simpson 1985 let wf be a vector of observations on the natural logarithm of hourly wages paid to full time workers and let x be a matrix of observations on measurable worker characteristics commonly used in such models namely educational attainment age sex union status public vs private sector status and region let wp and x be the corresponding observations for part time workers let h be the maximum hours of work permitted for classification as a part time worker then we specify wf xff3f if if h h 1

who are the members of the international club this article proposes pragmatic methods that incorporate recent contributions to public good theory to identify the members of the international club and how they select new members this article also suggests simple applications to the recent problems in international clubs such as the euro and nato

the definition of part time employment a switching regression model with unknown sample selection rejecting the standard less than thirty five hours per week categorization of part time workers this paper offers an empirically justified definition of the part time employed the definition is based on the distinction through wage payments that employers make between a high hours full time and a low hours part time group of workers a switching regression model of wage equations with deterministic but unknown sample selection is estimated resulting in a significant split between high hours and low hours workers that is higher than the standard definition wage differentials are calculated and decomposed and estimates from the structural choice model are presented copyright 1991 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

strategic information acquisition and the mitigation of global warming abstract we consider the strategic role of uncertainty and information acquisition for the mitigation of global warming before the countries decide on their contribution to a mitigation of global warming they may invest in information about the country specific benefit of reductions of the emissions of greenhouse gases we show that information acquisition has a substantial strategic value countries may prefer not to learn their benefit of climate protection even if information acquisition does not involve a direct cost this strategic information choice may further decrease the efficiency of the public good provision

theoretical incentive properties of contingent valuation questions do they matter in the field abstract green et al 1998 green d jacowitz k e kahneman d mcfadden d 1998 referendum contigent valuation anchoring and willingness to pay for public goods resource and energy economics 20 2 85 116 show theoretically that stated preference questions about public services can be framed in such ways that if the subjects accept the frame the payoff maximizing behavior will be to answer truthfully one key element of such a theoretically incentive compatible framing is that the hypothetical decision rule specified in the survey instrument is understood to be a majority rule rather than the efficiency rule typically used in cost benefit analysis we conducted field experiments in germany and switzerland to test if a referendum framing as suggested by green et al is effective in reducing strategic misrepresentation in a contingent valuation setting we did not find the expected effects of the framing treatments on stated willingness to pay or on individuals stated beliefs about the social choice context the results do not support hopes that a theoretically incentive compatible framing could be purposefully used to invoke the specific beliefs about the linkage between responses and policy implementation that would make stated preference questions incentive compatible

the effects of grants in aid on state and local expenditures abstract this paper develops econometric methods to estimate the effect of the piecewise linear budget constraints created by grant formulas in which the subsidy rate is not constant over expenditures e g closed end grants the methods are applied to the afdc program the results show that because of the kinked nature of the grant formula 1 the present federal formula actually increases cross state inequality in afdc benefits 2 several subsidy rates in the formula actually reduce benefits and 3 the so called flypaper effect disappears

a model of female labour supply in the presence of hours restrictions abstract we develop a discrete choice model of female labour supply in finland using a data set constructed by merging the 1980 labour force survey and housing and population census this contains observations on the perceived incidence of constraints in the labour market and allows us to identify the effects of such constraints on observed labour supply approximately one in five women appears to be seriously constrained in her choice of hours of work our estimated model implies that the response of labour supply to variation in tax and wage rates is rather small

effects of technology transfers on the provision of public goods in this paper we examine the viability ofcooperative policies oriented to the resolution oftransboundary pollution problems using the theory ofprivate provision of public goods in a two countrymodel we analyze the effects on economic welfare ofvoluntary technological transfers oriented to reducingthe emission of pollutants

international issues in entrepreneurship in recent decades there has been a substantial increase in private and public investment in entrepreneurship this trend has important managerial financial and public policy implications there is also considerable interest in understanding the financial practices of early stage companies the recent global resurgence of leveraged buyouts and the concomitant rise of private equity markets have also heightened interest in entrepreneurship e g cumming et al 2007 in this essay we provide focused summaries of the papers in this special issue which address these issues

international aid from the recipient perspective public or private good input assistance abstractthis article proposes a theoretical model from the recipient perspective that considers what type of assistance a donor country should provide public good assistance or private good assistance we investigate the effects of migration and free riders under both types of assistance we empirically apply this model to the rapidly growing economies and a large official development assistance disbursement for east asia

child care costs and family labor supply this paper presents a theoretical and empirical analysis of the effects of child care costs on family labor supply and the demand for market child care the model is a framework for cross section estimation of the effects of child care costs on labor supply and child care use it applies to households having young children requiring continuous care and in which both the mother and 1 other potential child care provider are present the 3 potential sources of child care are the mother the potential informal provider and the market using data from the 1980 baseline household survey of the employment opportunity pilot projects this empirical analysis uses a subsample of 6170 households in which there is a married woman under age 45 with her spouse present at the time of the survey at least 1 child under age 14 and nonmissing data on key variables results show that 1 higher market child care costs discourage women from working even when an informal source of care is available indicating that such informal care is an imperfect substitute for market care 2 a higher wage rate for the mother encourages her to work thus a higher wage rate increases the probability of using market child care 3 the number of children requiring care has a negative impact on the probability of the women working with the largest impact caused by younger children 4 nonwage income has a negative impact on the probability of the woman working and 5 black women are more likely to work than whites and are statistically more likely than whites to use market child care if they do work this family labor supply model predicts that the cost of market child care will affect household decisions on labor supply and child care use estimates of a qualitative choice model provide strong confirmation that child care costs affect such decisions the responsiveness of the labor supply of mothers to child care costs demonstrated in this study indicate that such subsidies do have their intended effect of encouraging labor supply the fact that a large proportion of current child care subsidies benefit primarily middle and upper income families via the income tax credit suggests that the labor supply effets of such subsidies may in practice be stronger for less needy families than for low income families employer subsidized child care may become an increasingly popular tool for attracting mothers into the labor force