does sports activity improve health representative evidence using local density of sports facilities as an instrument abstractusing representative and geocoded data from the swiss household panel and the swiss business census we estimate the effect of sports activity on health ols models show that sports activity significantly decreases overweight sleeping problems headaches back problems and perceived health impediments in everyday activities and significantly increases health satisfaction because sports activity is likely to be misreported and correlated with unobserved determinants of health we use the number of sports facilities within 6 miles of the individual s residence as an instrument for sports activity although the instrument is powerful in explaining sports activity the second stage effects on health are mostly statistically insignificant due to the high ses of the iv estimates

repeated rounds with price feedback in experimental auction valuation an adversarial collaboration it is generally thought that market outcomes are improved with the provision of market information as a result the use of repeated rounds with price feedback has become standard practice in the applied experimental auction valuation literature we conducted two experiments to determine how rationally subjects behave with and without price feedback in a second price auction results from an auction for lotteries show that subjects exposed to price feedback are significantly more likely to commit preference reversals however this irrationality diminishes in later rounds results from an induced value auction indicate that price feedback caused greater deviations from the nash equilibrium bidding strategy our results suggest that while bidding on the same item repeatedly improves auction outcomes this improvement is not the result of price feedback

informational asymmetries strategic behavior and industrial organization one of the most active and exciting areas of economic research over the last several years has been the use of noncooperative games of incomplete information to model industrial competition this work has yielded not only a remarkable number of papers but also several new insights on and explanations of fundamentally important issues the purpose of this paper is to attempt an appreciation and evaluation of this work because most of our individual and joint work since about 1979 has been in this mode it will come as no surprise that we are proponents of this line of research however there are several questions and potential problems that we see as arising in connection with this methodology and we will attempt to address these first a disclaimer we are not attempting a survey of the applications of asymmetric information games aig to industrial organization although we will refer in a highly selective fashion to a number of prominent strands in this literature in particular where any references are provided at all they are typically only to the earliest contributions to a subject even more we do not deal with work in which informational asymmetries are important but the analysis is not game theoretic for example search and price dispersion or the early work on the lemons problem and on moral hazard and adverse selection in insurance markets or with game theoretic treatments that assume complete information i aig methods and applications

resolving differences in willingness to pay and willingness to accept reply gwendolyn c morrison 1997 raises a logical point regarding our experimental test of the divergence between willingness to pay wtp and willingness to accept wta measures of economic value shogren et al 1994 she argues that our design does not provide a true test of the existence of a fundamental endowment effect since we did not control for the potential of a pivoting indifference map daniel kahneman et al 1990 she concludes that even though our ev idence shows that the mean wtp and wta bids for market goods with close substitutes e g candy bars and coffee mugs converge after market experience the endowment effect might still be alive and well albeit at statisti cally insignificant levels

long run effects of public sector sponsored training in west germany between 1991 and 1997 west germany spent on average about 3 6 bn euro per year on public sector sponsored training programmes for the unemployed we base our empirical analysis on a new administrative data base that plausibly allows for selectivity correction by microeconometric matching methods we identify the effects of different types of training programmes over a horizon of more than seven years using bias corrected weighted multiple neighbours matching we find that all programmes have negative effects in the short run and positive effects over a horizon of about four years however for substantive training programmes with duration of about two years gains in employment probabilities of more than 10 points appear to be sustainable but come at the price of large negative lock in effects

information costs and incentives to shirk disability compensation of air traffic controllers it has become fashionable in recent years to level charges of abuse at a variety of social welfare programs unemployment insurance and certain disability compensation programs come to mind as targets of a barrage of criticism based on inherent work disincentives and sloppy administration no doubt there is an element of truth in many of the criticisms however it is one thing to allege the existence of disincentives and quite another to predict the ways in which they will alter observable behavior this paper attempts the latter task numerous authors have noted that the incentives imbedded in any contract are a function of the contractual provisions and enforcement by its very nature a contract governing exchange between two parties constrains their behavior each contractual provision or restriction attempts to limit the responses of both parties however if the restrictions are not perfectly enforced the constraints are not binding which lowers the costs of contractual violations depending upon the type of contract these violations may be labeled default cheating shirking fraud negligence or moral hazard as a case in point consider the analysis by armen alchian and harold demsetz 1972 of the possibility that individuals might shirk contractual responsibilities if benefits exceeded the costs recall that the theory of shirking was originally couched in terms of a utility maximizing employee s laborleisure tradeoff labor time yields a pecuniary reward in the form of income leisure may be thought of as its own reward or as the time devoted to the individual s other desired pursuits given a time constraint an individual will allocate his labor to equate the gains from income with the gains from leisure at the margin if labor rewards are not perfectly correlated with productive effort then the incentive to produce is diminished shirking results if shirking could be costlessly detected neither party to a contract would have an incentive to shirk since the full costs of shirking could be brought to bear on the guilty party through renegotiations of the terms of trade however if detecting shirking through some monitoring mechanism is costly the guilty party will not generally be forced to bear the full costs of his behavior monitoring will only be undertaken so long as the marginal gains from reduced shirking equal or exceed the marginal costs of detection less than perfect monitoring implies some shirking incentives remain strickly speaking shirking may be defined as the act of seeking to avoid performance of contractual duty although alchian and demsetz developed the theory to explain organizations of employer employee relationships it is clear that it can be applied to any contract their results are now well known contractual violations are an increas university of delaware and purdue university respectively we are indebted to the carthage foundation and the krannert graduate school at purdue university for financial support we thank numerous colleagues at the university of delaware and purdue university for intellectual support in particular thanks must go to jack barron james chelius robert clower and an anonymous referee for their helpful comments on earlier drafts while much of the data used for testing came from owcp the faa and lengthy interviews with individuals in the air traffic control industry none of these groups encouraged or funded this study the views expressed here are solely our own the individual still adjusts at his labor leisure margin positive detection costs imply that each person will be induced to take more leisure because the effect of relaxing on his realized reward rate of substitution between output and leisure will be less than the effect on the true rate of substitution his realized cost of leisure will fall more than the true cost of leisure so he buys more leisure i e more nonpecuniary reward alchian and demsetz p 780

beauty and the labor market the authors examine the impact of looks on earnings using interviewers ratings of respondents physical appearance plain people earn less than average looking people who earn less than the good looking the plainness penalty is 5 to 10 percent slightly larger than the beauty premium effects for men are at least as great as for women unattractive women have lower labor force participation rates and marry men with less human capital better looking people sort into occupations where beauty may be more productive but the impact of individuals looks is mostly independent of occupation suggesting the existence of pure employer discrimination copyright 1994 by american economic association

the effects of prior beliefs and learning on consumers acceptance of genetically modified foods abstract new food products using genetically modified crops appeared in u s supermarkets starting in 1996 and consumers perceived some risks this paper examines the role of consumers prior beliefs about genetic modification and of diverse new information on their willingness to pay for foods that might be genetically modified we use data from economics experiments and show that participants who had informed prior beliefs discounted gm labeled food products more highly than those who had uninformed prior beliefs uninformed participants were especially susceptible to information from interested and third parties in contrast informed participants were generally not affected significantly by new information

the impact of obesity on wages abstract previous studies of the relationship between body weight and wages have found mixed results this paper uses a larger data set and several regres sion strategies in an attempt to generate more consistent estimates of the effect of weight on wages differences across gender race and ethnicity are explored this paperjnds that weight lowers wages for white females ols esti mates indicate that a difference in weight of two standard deviations roughly 65 pounds is associated with a difference in wages of 9 percent in absolute value this is equivalent to the wage effect of roughly one and a half years of education or three years of work experience negative cor relations between weight and wages observed for other gender ethnic groups appear to be due to unobserved heterogeneity i introduction several previous studies have found among females a negative cor relation between body weight and wages there exist three broad categories of ex planations for this finding the first explanation is that obesity lowers wages for example by lowering productivity or because of workplace discrimination the sec ond is that low wages cause obesity this would be true if poorer people consume

long run labour market and health effects of individual sports activities abstract this microeconometric study analyzes the effects of individual leisure sports participation on long term labour market variables health and subjective well being indicators for west germany based on individual data from the german socio economic panel study gsoep 1984 2006 econometric problems due to individuals choosing their own level of sports activities are tackled by combining informative data and flexible semiparametric estimation methods with a specific way to use the panel dimension of the data the paper shows that sports activities have sizeable positive long term labour market effects in terms of earnings and wages as well as positive effects on health and subjective well being

an experimental approach to valuing new differentiated products abstract an experimental store was created to evaluate initial demand for locally produced and guaranteed tender steak products as a more realistic alternative to contingent valuation cv and dichotomous choice experimental methods strengths of the approach are incentive compatibility a realistic consumption set and a familiar choice environment consumers selected among usda choice premium quality lean guaranteed tender and locally produced strip steaks a double hurdle count data model indicated initial willingness to pay wtp for locally produced steak comparable to prior cv results but demand was highly elastic demand for premium quality steak crowded out demand for the guaranteed tender product contrasting with prior dichotomous choice experimental results

endowments at birth and parents investments in children do parents invest more in higher quality children or do they compensate for lower quality by giving more to children with lower endowments we answer this question in the context of a large scale iodine supplementation programme in tanzania we find that children with higher programme exposure were more likely to receive necessary vaccines and were breastfed for longer siblings of treated children were also more likely to be immunised fertility behavior and investments at the time of birth were unaffected

consumers willingness to pay for the color of salmon a choice experiment with real economic incentives in most retail markets sellers post the price and consumers choose which products to buy we designed an experimental market with posted prices to investigate consumers willingness to pay for the color of salmon salmon fillets varying in color and price were displayed in twenty choice scenarios in each scenario the participants chose which of two salmon fillets they wanted to buy to induce real economic incentives each participant drew one binding scenario the participants then had to buy the salmon fillet they had chosen in their binding scenario the choice data were analyzed with a mixed logit model

can personal gasoline permit trading be effective an investigation into permit demand this study proposes a personal gasoline permit trading scheme to limit the total gasoline consumption thus reducing its environmental impact we studied the effectiveness of this scheme by analyzing the permit demand of a gasoline driven vehicle in transportation sector a general utility optimization model is formulated and a cobb douglas utility function is further assumed to analyze the response of permit demand to its price changes with the slutsky decomposition of price effects the results when defined in economic terms indicate that the permit demand of consumers in higher income groups are negatively related to permit price permit demand are also negatively related to permit price for consumers in medium income groups but with positive income effect and the direct relationship between permit demand of lower income groups and the price is defined as a giffen good effect that is for those low income groups when the permit price rises their demand for permits would also increase then us and singapore household expenditure data are used to show comparable results of a pilot personal gasoline permit trading scheme further some regulations on critical parameters such as permit allocation and permit prices in the policy design are proposed to make the scheme feasible in different income groups based on these results implications limitation and suggestions for future study are discussed

price information and bidding behavior in repeated second price auctions examining panel data on bidding behavior in over forty second price auction markets with repeated trials we observe that i posted prices influence the behavior of the median naive bidder ii posted prices do not affect the behavior of the median experienced bidder or the bidder for familiar goods and iii anticipated strategic behavior wanes after two trials the results suggest that while affiliation might exist in auctions for new goods the repeated trial design with nonprice information removes the correlation of values and provides the experience that bidders need to understand the market mechanism

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

testing commitment cost theory in choice experiments in choice experiments it is commonly assumed that individuals make choices in static and certainty decision making conditions real world choices however are usually made in a dynamic setting committing a purchase decision under conditions of uncertainty might have a commitment cost cc in this study we test cc theory using a nonhypothetical choice experiment specifically we test whether choice behavior and willingness to pay estimates differ when individuals have the option to gain present or delayed information or reverse the transaction our results suggest that the construction of a dynamic decision context can be relevant in the design of choice experiments

willingness to pay versus expected consumption value in vickrey auctions for new experience goods over the past two decades vickrey auctions have been widely used to elicit willingness to pay for new food products this article shows that in a multiperiod context it can be optimal for consumers to bid higher than the expected consumption value for a new experience good to obtain information about how the new good fits into their preference set the degree of uncertainty about the consumption value the purchasing frequency and expected future market prices affect both the expected value of the quality information and the subgame perfect bidding strategy in vickrey auctions for new experience goods

consumer willingness to pay to reduce the probability of retail foodborne pathogen contamination abstract the us department of agriculture applies a cost of illness approach to value reductions in morbidity which may understate the projected benefits from proposed food safety improvements by ignoring costs such as pain suffering and worry we use a national survey with a hypothetical food choice experiment to estimate a more comprehensive measure of consumer willingness to pay for food safety improvements our approach differs from previous evaluations of food safety improvements because we 1 provide the respondent with information about the promised change in the probability of pathogen contamination in retail food packages rather than changes in the probability of becoming ill 2 elicit changes in respondents subjective probability of becoming ill and 3 elicit predicted changes in the quantity demanded for products that have enhanced food safety properties we estimate the consumer s choice between a safety enhanced and an existing product the change in subjective probability of contracting foodborne illness associated with the enhanced product and the change in demand for the enhanced product in a manner that recognizes the correlation among unobserved elements the aggregated results suggest benefit estimates that are significantly larger than previous estimates for similar improvements

combining participatory crop trials and experimental auctions to estimate farmer preferences for improved common bean in rwanda abstract participatory crop improvement raises the prospects for developing seed varieties that meet the needs of subsistence farmers but may face challenges regarding preference elicitation particularly in complicated policy environments we integrate binding experimental auctions with participatory variety selection to elicit farmers preferences for improved common bean varieties in rwanda we find that auctions reveal farmer preferences more accurately than stated nonbinding rankings in this context and that participatory on farm crop research is essential to understanding how farmers evaluate tradeoffs between multiple crop attributes we also find that farmers highly value intercrop yield despite government policy that encourages farmers to monocrop

posted prices and bid affiliation evidence from experimental auctions in most experimental auctions researchers ask participants to bid on the same item in multiple po tentially binding rounds posting the price submitted by the top bidder or bidders after each of those rounds if bids submitted in later rounds are affiliated with posted prices from earlier rounds this practice could result in biased value estimates in this article we discuss the results of an experiment designed explicitly to test whether posted prices affect bidding behavior we find that for familiar items high posted prices lead to increased bids in subsequent rounds our results have implications for researchers conducting experimental auctions article advances the literature in several im portant ways first we report the design and results of the only study designed specifically to control for the effects of posted prices on bids in subsequent rounds we do this with the aid of confederate bidders who were instructed to bid within a certain narrow range thus we have multiple treatments that vary only by the presence or absence of confederate bidders al lowing for what we believe to be the cleanest possible test of the effect of posted prices on bidding behavior in later rounds while list and shogren 1999 model bids in round t as a function of the posted price in round t 1 through our use of confederate bidders to con trol posted prices we are able to test whether exposure to high posted prices has an effect that accumulates over the course of multiple rounds leading to a gradual increase in mean bids second our methods of analysis are more complete than previous work examining bid af filiation we not only compare summary statis tics from early and late rounds but we also use panel data analysis to understand how in dividual participants bids are affected by the presence of confederate bidders focusing on individuals rather than summary statistics al lows us to understand how individual specific characteristics influence affiliation and it also allows us to better understand the role of out liers

exact consumer s surplus and deadweight loss consumer s surplus is a widely used tool in applied welfare economics both economic theorists and cost benefit analysis often use consumer s surplus despite its somewhat dubious reputation the basic idea is to evaluate the value to a consumer or his willingness to pay for a change in price of a good from say pricep to pricep because price changes affect consumer welfare an evaluation of this effect is often a key input to public policy decisions yet consumer s surplus is probably the most controversial of widely used economic concepts both paul samuelson and ian little conclude that the economics profession would be better off without it it is my feeling of the situation that substantial agreement exists on the correct quantities to be measured the amount the consumer would pay or would need to be paid to be just as well off after the price change as he was before the price change the quantities correspond to john hicks compensating variation measures an alternative measure which takes ex post price change utility as the basis of comparison is hicks equivalent variation the controversy arises in the measurement of these quantities the usual measurement procedure is to use the area to the left of the marshallian market demand curve between two price levels jules dupuit originated this measure of welfare change and alfred marshall and hicks derived appropriate conditions for its use the primary condition for the area to the left of the demand curve to correspond to the compensating variation is to have constant marginal utility of income marshall gave this condition and if it holds the same quantity will be derived as the area to the left of the compensated hicksian demand curve this area to the left of the compensated demand curve is exactly what the compensating variation and equivalent variation measure thus the constant marginal utility of income is a sufficient condition for marshallian consumer s surplus to be equal to hicks consumer s surplus in this case arnold harberger s plea to use the welfare triangle as one half times the product of the price change times the quantity change to measure deadweight loss corresponds to the correct theoretical amount of welfare change in a recent paper robert willig derives bounds for the percentage difference between the correct measure of either the compensating or equivalent variation and the marshallian measure derived form the market demand curve his bounds which depend on the income elasticity of demand for the single good in the region of price change being considered as well as the proportion of the consumer s income spent on the good demonstrate that the marshallian consumer s surplus is often a good approximation to hicks consumer s surplus the fact that the proportion of the consumer s income spent matters as well as the income elasticity was first pointed out by harold hotelling willig contends that the approximation error will be less than the errors involved in estimating the demand curve thus he hopes to remove the need for apology that applied economists often need to give to theorists who remark on the inappropriateness of using marshallian consumer s surplus to measure welfare change however in this paper i show that for the case primarily considered by willig of a single price change which is also the situation in which consumer s surplus is often used in applied work no approximation is necessary professor of economics massachusetts institute of technology and research associate national bureau of economic research i would like to thank peter diamond erwin diewert daniel mcfadden robert merton robert solow hal varian joel yellin and the referees for help and comments research support from the national science foundation is acknowledged the reason that we still have two rather than one of samuelson s six measures of consumer s surplus arises from an index number problem of the correct basis for the welfare comparison i will give both measures but plan to concentrate on the compensating variation

heterogeneous sports participation and labour market outcomes in england based on a unique composite dataset measuring heterogeneous sports participation labour market outcomes and local facilities provision this article examines for the first time the association between different types of sports participation and employment and earnings in england clear associations between labour market outcomes and sports participation are established through matching estimation while controlling for some important confounding factors the results which are supplemented and supported by a formal sensitivity analysis suggest a link between different types of sports participation to initial access to employment and then higher income opportunities with ageing however these vary between the genders and across sports specifically the results suggest that team sports contribute most to employability but that this varies by age across genders and that outdoor activities contribute most towards higher incomes

welfare gains from quality certification of infant foods results from a market experiment in mali in low income countries malnutrition is often most severe among infants of six to twenty four months they need higher density foods than the family diet but density is a credence attribute we hypothesize that the premium now paid for heavily advertised brands reflects demand for quality assurance which could be provided at lower cost to competing firms through third party certification we use a new market experiment to find that mothers average willingness to pay for certification is about 1 75 kg or four times its cost so that total economic surplus gains from introducing certification to mali would be on the order of 1 million annually

the estimated ex ante economic impact of bt cowpea in niger benin and northern nigeria genetically modified gm crops could increase economic growth and enhance living standards in africa but political issues have slowed the use of biotechnology this is the first study that assesses the potential impact of gm crops in africa while considering the preferences of producers and consumers towards gmos as well as the income and price risks they face the study uses a choice experiment to estimate the ex ante economic impact of a novel technology bacillus thuringiensis bt cowpea on producers and consumers in benin niger and northern nigeria the experiment involves the simulation of a market transaction similar to those in open air markets in west africa during the market simulation respondents are informed about the advantages and disadvantages including health risks of bt cowpea the results from the study suggest that cowpea growers and consumers in benin and northern nigeria prefer bt to conventional cowpea for health safety reasons the results estimate that social welfare in benin niger and northern nigeria would increase by at least us 11 82 per capita annually with bt cowpea if seed sectors are operating smoothly with inefficiencies in seed sectors and the potential for cowpea acreage increase the estimated social welfare increase in the region would be about us 1 26 per capita annually

potential health benefits of golden rice a philippine case study abstract golden rice has been genetically modified to produce beta carotene in the endosperm of grain it could improve the vitamin a status of deficient food consumers especially women and children in developing countries this paper analyses potential impacts in a philippine context since the technology is still at the stage of r d benefits are simulated with a scenario approach health effects are quantified using the methodology of disability adjusted life years dalys golden rice will not completely eliminate the problems of vitamin a deficiency such as blindness or increased mortality therefore it should be seen as a complement rather than a substitute for alternative micronutrient interventions yet the technology could bring about significant benefits depending on the underlying assumptions annual health improvements are worth between us 16 and 88 million and rates of return on r d investments range between 66 and 133 due to the uncertainty related to key parameters these results should be treated as preliminary

sequential causal models for the evaluation of labor market programs this article reviews inverse selection probability weighting to estimate dynamic causal effects a distribution theory based on sequential generalized method of moments estimation is proposed and the method is applied to a reevaluation of some parts of the swiss active labor market policy to obtain new results and discuss several issues about the implementation of the estimation procedure

workers compensation and moral hazard in tunisia abstractmoral hazard is a problem of asymmetric information that plays a central role in numerous contractual relationships and may lead to suboptimal resource allocation both ex ante and ex post moral hazard problems in workers compensation wc have been extensively analysed in developed countries the main objective of this paper is to test the presence of ex post moral hazard in the tunisian context to our knowledge this is the first analysis on this topic in a developing country tunisia it is particularly important to study moral hazard problems in developing countries since the negative impacts of such problems could be exacerbated in the developing world dionne and st michel 1991 have developed a methodology for testing for the presence of ex post moral hazard in the context of a more generous wc regime in quebec the tunisian institutional context that we study is similar to that prevailing in quebec that is in 1995 there was a significant increase in the generosity of the wc regime

which deceptive practices if any should be allowed in experimental economics research results from surveys of applied experimental economists and students deceptive experimental practices are banned in some professions but are standard in others recently the journals of the agricultural and applied economics association introduced guidelines that allow researchers to publish articles that use some forms of deception however in their present form these guidelines leave room for interpretation this situation is not ideal for researchers and a clearer definition of which deceptive practices should be banned could be beneficial our aim is to help provide greater clarity and potential guidance for journal policies regarding deception by using the results of surveys of both researcher and student subjects evaluating ten potentially deceptive experimental techniques we find consistent support for banning certain practices while allowing others

comparing open ended choice experiments and experimental auctions an application to golden rice we use two experimental valuation methods to estimate consumer demand for genetically modified golden rice the first is an open ended choice experiment oece where participants name the quantities of golden rice and conventional rice demanded at each of several price combinations one of which will be randomly chosen as binding this allows us to estimate market demand by aggregating demand across participants this estimate of market demand also allows us to estimate own price elasticity and consumer surplus for golden rice comparing willingness to pay wtp estimates from the oece with those from a uniform price auction we find that oece wtp estimates exhibit less affiliation across rounds and the effects of positive and negative information under the oece are more consistent with prior expectations and existing studies we also find that while auction wtp estimates more than double across five rounds oece wtp estimates are stable across rounds and are always roughly equal to those from the final auction round

the impact of deal proneness on wtp estimates in incentive aligned value elicitation methods even after controlling for hypothetical biases some incentive aligned value elicitation methods still produce different willingness to pay wtp estimates in this study we compare wtp estimates from three incentive aligned value elicitation methods real choice experiment rce real double bounded dichotomous contingent valuation rcvm and becker degroot marschak auction bdm we find that participants aggressiveness in obtaining low prices i e deal proneness influences wtp estimates in the bdm auction but not those elicited from the rce and rcvm the participants with higher levels of deal proneness tend to submit lower bids in the bdm auction the discrepancies in wtp estimates between different incentive aligned procedures are narrower for participants with lower levels of deal proneness our results indicate that the bids in bdm auctions may be understated and the auction mechanism may induce the gambling behavior of people who are deal prone that is whether the bdm auction is truly incentive aligned is again called into question we also discuss the practical implications for food retailers

information and consumer willingness to pay for biofortified yellow cassava evidence from experimental auctions in nigeria in this article we use the becker degroot marschak mechanism to estimate consumer demand for biofortified yellow cassava varieties in two states of nigeria imo in the southeast and oyo in the southwest these two states exhibit distinct habitual product color preferences for staple food made with cassava we estimate the effect of nutrition information campaigns and nature of planting material delivery institutions on consumer demand willingness to pay estimations account for the effect of product endowment censoring in bids and nonpayment in oyo consumers are willing to pay a premium for light yellow cassava variety even in the absence of nutrition information the article finds that nutrition information results in a large and significant price premium for biofortified cassava in both states and the nature of delivery institution has no significant effect

disability insurance benefits and labor supply some additional evidence this article examines the effects of a change in the canada quebec pension plan c qpp disability benefits on the labor supply of older canadian workers i obtain my estimates by exploiting a large increase in benefits that only occurred in the qpp program which only operates in quebec while benefits in the cpp program which operates in the rest of canada were unaffected unlike the existing estimates from the united states as well as earlier canadian obtained by gruber i find that disability benefits are not associated with a large increase in the nonparticipation of older men

searching for the opportunity cost of an individual s time a traditional assumption made in the literature is that the value of an individual s time spent in any activity is equal to his or her wage rate this result stems from the derivation of the value of leisure time in the context of the standard labor supply model this paper pre sents some reasons why the relationship be tween the wage rate and the value of time does not hold suggestions for what to do when the relationship breaks down and the investigator needs some value to impute to the individual are given in the final section of the paper

multidimensional welfare distributions empirical application to household panel data from vietnam this article explores the empirical application of theoretical multidimensional welfare distribution analysis techniques to real household welfare distributions the article operationalizes recent conceptual developments in multidimensional distribution theory and assesses their usefulness for the measurement of multidimensional household inequality the results strongly highlight the importance of bringing nonmonetary aspects of household welfare into the forefront of inequality analysis agreement over the various approaches to the measurement of multidimensional inequality entails however nontrivial decisions that may limit the practical usefulness of these measures we suggest that the use of multidimensional inequality ranges and the application of restrictive dominance criteria to multidimensional welfare distributions may open significant scope for further developments in the empirical analysis of multidimensional inequality

effects of cheap talk on consumer willingness to pay for golden rice a large body of literature suggests willingness to pay is overstated in hypothetical valuation questions as compared to when actual payment is required recently cheap talk has been proposed to eliminate the potential bias in hypothetical valuation questions cheap talk refers to process of explaining hypothetical bias to individuals prior to asking a valuation question this study explores the effect of cheap talk in a mass mail survey using a conventional value elicitation technique results indicate that cheap talk was effective at reducing willingness to pay for most survey participants however consistent with previous research cheap talk did not reduce willingness to pay for knowledgeable consumers

workers compensation moral hazard and the composition of workplace injuries this paper provides evidence that workers compensation insurance wc affects not only the occurrence but also the composition of reported injuries in our theoretical approach wc is the source of two interrelated moral hazard problems underprovision of accident preventing efforts by the insured worker ex ante moral hazard and false reporting of injuries ex post moral hazard our model predicts that under certain assumptions the impact of wc benefits is stronger on the probability of reporting a difficult to diagnose injury than on the probability of reporting an injury that is easy to diagnose panel data on 9 800 workers in the quebec construction industry over each month of the period 1977 86 combining administrative data from the quebec construction board with data from the quebec workers compensation board are used for the estimates the parameters of the model are estimated using a threealternative logit kernel hybrid multinomial probit mnp framework with individual random effects our results confirm our theoretical pre

are valuations from nonhypothetical choice experiments different from those of experimental auctions due to the importance of comparability and external validity of results nonhypothetical experimental methods are increasingly used to elicit consumers willingness to pay for various goods two of the increasingly popular preference elicitation methods are the nonhypothetical choice experiments and experimental auctions we conduct experiments to compare willingness to pay estimates elicited from both methods our results generally suggest that valuations elicited from experimental auctions can differ from those obtained from nonhypothetical choice experiments copyright 2011 oxford university press

effects of physical activity on earnings in the brazilian labor market abstract this article investigates the effects of physical activity on earnings in the brazilian labor market analyzing workers aged between 30 and 50 years to that end quantile regression was applied to analyze microdata from the 2008 national household sample survey pnad the results showed that workers who engage in regular physical exercise exhibit better social and economic conditions compared to sedentary individuals sedentary lifestyles are typically more common among female employees than their male counterparts and this is reflected in earnings in the labor market the impact of physical activity on wages varied from 15 0 to 31 0 and was greater among the highest quantiles the lowest salaries were recorded among non white sedentary women

consumer s surplus without apology the purpose of this paper is to settle the controversy surrounding consumer s surplus and by so doing to validate its use as a tool of welfare economics i will show that observed consumer s surplus can be rigorously utilized to estimate the unobservable compensating and equivalent variations the correct theoretical measures of the welfare impact of changes in prices and income on an individual i derive precise upper and lower bounds on the percentage errors of approximating the compensating and equivalent variations with consumer s surplus these bounds can be explicitly calculated from observable demand data and it is clear that in most applications the error of approximation will be very small in fact the error will often be overshadowed by the errors involved in estimating the demand curve the results in no way depend upon arguments about the constancy of the marginal utility of income consequently this paper supplies specific empirical criteria which can replace the apologetic caveats frequently employed by those who presently apply consumer s surplus moreover the results imply that consumer s surplus is usually a very good approximation to the appropriate welfare measures to preview below i establish the validity of these rules of thumb for a

wage gains associated with height as a form of health human capital height is consulted as a latent indicator of early nutrition and lifetime health status height is observed to increase in recent decades in populations where per capita national income has increased and public health activities have grown height is determined by genetic make up and realized in part through satisfactory nutrition and health related care and conditions alternative instrumental variables iv are explored which proxy price and income constraints which are expected to influence the latter reproducible human capital investments in height i report ols and iv estimates of the partial effect of height on log hourly wages in recent national surveys from three countries ghana brazil and the united states i conclude that the human capital productivity effect of height estimated by parent education ivs in the us and ghana are many times larger than the ols estimates and in ghana and brazil the regional price ivs estimates also imply a substantially larger human capital wage effects of height compared with the ols estimates the ols estimates of height effects on wages are dominated by the genetic variation in height and appear to understate substantially the human capital returns to health and nutrition inputs which increase adult height this abstract was borrowed from another version of this item

estimating a household production function heterogeneity the demand for health inputs and their effects on birth weight the household production literature emphasizes that technical or biological processes condition input selection by households in their production activities along with prices and income exogenous variations in health to the extent that they are perceived by individuals heterogeneity lead to correlations between inputs and health outcomes that cannot be used to derive causal conclusions therefore estimates of health technology must be obtained from a behavioral model in which health inputs are themselves choices consistent estimates are reported of the effect of endogenous inputs such as medical care smoking and fertility on birth weight and fetal growth in the presence of health heterogeneity

a microeconometric evaluation of the active labour market policy in switzerland in the second part of the 1990 s switzerland conducted an ambitious active labour market policy almp encompassing a wide variety of programmes we evaluate the effects of these programmes on the individual employment probability of potential participants our econometric analysis uses unusually informative data origi nating from administrative unemployment and social security records we apply a matching es timator adapted for the case of multiple programmes we find substantial positive effects for one particular programme that is a unique feature of the swiss almp it consists of a wage subsidy for temporary jobs in the regular labour market that would otherwise not be taken up by the unemployed we also find large negative effects for traditional employment programmes oper ated in sheltered labour markets for training courses the results are mixed doi 10 1111 1468 0297 00072 download internet appendix pdf 2 590 kb

the effect of adolescent experience on labor market outcomes the case of height taller workers receive a wage premium net of differences in family background the disparity is similar in magnitude to the race and gender gaps we exploit variation in an individual s height over time to explore how height affects wages controlling for teen height essentially eliminates the effect of adult height on wages for white men the teen height premium is not explained by differences in resources or endowments the teen height premium is partially mediated through participation in high school sports and clubs we estimate the monetary benefits of a medical treatment for children that increases height

using laboratory experimental auctions in marketing research a case study of new packaging for fresh beef this paper illustrates the use of laboratory experimental auctions in a pretest market research program for new products we review the experimental auctions literature discuss the range of auction mechanisms available and present the advantages and disadvantages of using a particular mechanism for a laboratory pretest market we then present a step by step example of how a theoretically incentive compatible auction mechanism fifth price sealed bid was used in a laboratory pretest market for vacuum packaged beef based on the illustration we discuss the potential for using laboratory experimental auctions in pretest market research we present the limitations that may be encountered in such applications and outline research aimed at improving the behavioral properties of the technique

preference learning in consecutive experimental auctions this paper explores the origins of the strikingly high price premia paid for new food products in lab valuation exercises our experimental design distinguishes between two explanations of this phenomenon novelty of the experimental experience versus the novelty of the good i e preference learning bids reflect a person s desire to learn how an unfamiliar good fits into their preference set subjects bid in four consecutive experimental auctions for three goods that vary in familiarity candy bars mangos and irradiated meat our results suggest that preference learning is the main source of the high premia and that novelty of the experimental experience does not in itself artificially inflate valuations copyright 2000 oxford university press

population growth and human capital investments theory and evidence this paper presents evidence from empirical studies that test hypotheses derived from models of household behavior pertaining to the interrelationships among population growth human capital and economic development these studies have exploited quasi natural experiments embodied in the cross area variability in the wage rates of children in a number of low income countries the intercouple variation in the biological propensity to conceive and the geographically selective introduction of new high yielding seed varieties in india in the period 1961 71 the different varieties of evidence support the hypotheses that alterations in the returns to human capital associated with exogenous technical change lead simultaneously to increases in human capital investments and to reductions in fertility and that the costliness of fertility control is a significant but modest factor in inhibiting human capital investments

schooling health knowledge and obesity the connection between schooling and health is well documented an important empirical issue that needs to be examined however is whether schooling s effects are due to individual health knowledge differences this empirical study examines this issue with an increasingly important health indicator obesity since provision of health knowledge is a major tool of public agencies promoting health this empirical study uses a new direct measure of health knowledge to test this hypothesis the results show that knowledge is inversely related to the probability that an individual is obese schooling s effects on relative weight and the probability of being obese are explained by differences in knowledge this result may imply that schooling s effect on the allocative efficiency of the household production of health is the main reason schooling is linked to health behaviour the result also may imply that the most effective method of health education is to highlight the disease element of poor dietary habits a

alcohol and earnings does drinking yield a wage premium this paper examines the relationship between alcohol consumption and earnings for prime age males wage differentials for non moderate and heavy drinkers are estimated using a polychotomous choice model which accounts for the endogenous relationship be tween drinking and earnings we find that moderate alcohol consumption leads to increased earnings relative to abstention however heavy drinking leads to reduced earnings relative to moderate drinking heavy drinkers possess flatter age earnings profiles and attain lower returns for higher education than non and moderate drinkers these results are in contrast to previous research on substance abuse which finds no earnings drop off for heavy users

the adding up test in an incentivized value elicitation mechanism the role of the income effect in the context of testing the construct validity of stated preference studies some researchers advocate the use of an adding up test designed to gauge whether elicited values are sufficiently sensitive to a change in the scope i e size of a good crucial to the applicability of this test in practice which relies on endowing a subsample of respondents with a good free of charge is that the income effects due to endowment are negligible in this study we apply the adding up test in an experimental value elicitation format to examine the potential effect of endowment as part of the test design on the adding up property of elicited values the results show that the adding up property can be affected by free provision of part of the bundle

the incentive effects of tournaments with positive externalities among workers much recent research concerning work incentives has analyzed tournaments or contests between workers for rewards based on a comparison of their relative performance 3 5 8 9 12 bull schotter and weigelt 2 2 argue that tournaments are empirically pervasive characterizing incentives for many salespeople competing for bonuses managers vying for high level positions academics striving for limited tenured positions and politicians whose election hinges on relative votes received contrarily nalebuff and stiglitz 12 40 suggest that tournaments are rare for example many employees face incentives produced by upward sloping age earnings profiles 6 individual piece rates profit sharing or group bonus schemes 14 or potential firing 11 responding to this lack of agreement over the pervasiveness of tournaments recent theoretical research has begun to identify circumstances where tournaments fail or succeed the corpus of such work generalizes the conditions under which tournaments are optimal for example tournaments can respond effectively to common environmental shocks to productivity 5 12 heterogeneous workers 13 employee and employer moral hazard problems 3 monitoring difficulties 9 and inefficiencies associated with firing as an incentive 11 less work has addressed circumstances where tournaments may fail the question which concerns us here to date three circumstances where tournaments fail have been identified first as lazear and rosen noted in their seminal article on tournaments such incentives fail if individual effort can be measured perfectly or precisely inferred from output as they put it a difference of opinion is necessary for a horse race 8 845 if the winner is known before the race only the winner will run and slowly at that second lazear 7 analyzes circumstances where agents can engage in sabotage or increase the probability of winning by reducing their opponent s measured output tournaments then fail because the saboteur can reduce his or her own output while

unemployment and infant health times series evidence from the state of tennessee this is the first study that decomposes unemployment into its structural and cyclical components and investigates their impact on income distribution controlling for the influence of inflation increases in structural unemployment have a substantial

prenatal care demand and birthweight production of black mothers infant mortality in the united states has declined by one half in the past 20 years for both blacks and whites though the black infant mortality rate has steadily remained twice the white rate helen wallace 1994 the incidence of low birthweight unfortunately has remained almost unchanged over the same time period again with the black rate being twice the white rate wallace 1994 these two trends taken together suggest that the reduced mortality rate is due entirely to medical advances which allow more small weak and sick newborns to survive this paper investigates the health of newborns using the approach of mark rosenzweig and paul schultz 1982 1983 see also eugene lewit 1983 their work is extended by incorporating the number of visits and a visitsxdelay interaction term into prenatal care demand the goal is to obtain consistent estimates of the impact of prenatal care on infant birthweight these estimates can then be used to design interventions aimed at reducing the incidence of low birthweight

a market based approach to child nutrition mothers demand for quality certification of infant foods in bamako mali this paper analyses the potential impact of introducing quality certification to the market for infant foods in a very low income country where malnutrition is widespread using an experimental economics approach we find that a program to sample test and certify the nutrient density of products could promote a more competitive market for low cost fortified foods and be implemented on a self financing basis yielding net economic benefits on the order of us 1 million per year in the city of bamako we find that mothers demand for quality information rises with their education and income level but is higher than the estimated cost of certification even among the very poor and uneducated