policy relevant treatment effects accounting for individual level heterogeneity in the response to treatment is a major development in the econometric literature on program evaluation a substantial body of empirical evidence demonstrates that econometric models fit on individual level data manifest heterogeneity in treatment effects that is present even after conditioning on observables an important distinction is the one between evaluation models where participation in the program being evaluated is based at least in part on unobserved idiosyncratic responses to treatment and models where participation is not based on unobserved idiosyncratic responses this is the distinction between selection on unobservables and selection on observables the validity of entire classes of evaluation estimators hinges on whether or not they allow agents to act on unobserved idiosyncratic responses in a wide variety of applications the available evidence suggests that not only are ex post postenrollment responses heterogeneous but that ex ante decisions to participate in programs are based in part on these heterogeneous responses heckman and vytlacil 2000b 2001

malthus living in a slum urban concentration infrastructure and economic growth abstract the link between urban concentration primacy and economic growth at country level is not straightforward as there are benefits as well as costs associated with urban primacy recent empirical evidence suggests a differential negative effect of concentration in sub saharan africa compared to the rest of the world this paper revisits the literature on urban concentration and economic growth to shed some light on these recent results the main contribution of the paper is to show how differentiated effects of urban primacy on economic growth can be accounted for by considering a role for the quality of the urban environment in terms of urban infrastructure the role of urban infrastructure is found to be robust to a long list of controls different specifications different estimation techniques and potential bias from simultaneity and measurement error

from malthusian stagnation to modern growth this paper investigates the historical evolution of the relationship among population growth technological change and standard of living the analysis focuses on two most important differences among the malthusian regime post malthusian regime and modern growth regime these were the behavior of income per capita and the relationship between the level of income per capita and the population growth rate the modern growth regime is characterized by steady growth in both income per capita and the level of technology in the malthusian regime technological progress and population growth was glacial by modern standards and income per capita was fairly constant in contrast to the modern growth regime the relationship between per capita income and population growth in the malthusian regime was positive post malthusian regime shared one characteristic with each of the two regimes in addition this paper developed and described an endogenous growth model consistent with the above mentioned transition process

anomalies risk aversion economists ubiquitously employ a simple and elegant explanation for risk aversion it derives from the concavity of the utility of wealth function within the expected utility framework we show that this explanation is not plausible in most applications since anything more than economically negligible risk aversion over moderate stakes requires a utility of wealth function that is so concave that it predicts absurdly severe risk aversion over very large stakes we present examples of how the expected utility framework has misled economists and why we believe a better explanation for risk aversion must incorporate loss aversion and mental accounting

fishermen markets and population diversity fishing impacts biodiversity on multiple levels potentially resulting in unintended feedbacks to the economic performance of the fishery over time for example targeting observable traits within a population can impact genetic diversity and targeting valuable species can impact biodiversity at the ecosystem level the bioeconomic literature however has given little attention to the effect of fishing on population diversity even though population diversity contributes to ecosystem services and estimates of population extinction rates are three orders of magnitude higher than species extinction rates here we develop a stochastic bioeconomic model that links the harvest of multiple salmon populations in a single commercial fishery to the trajectory of population diversity in a salmon stock complex we parameterize our model with biological and economic data from the copper river chinook salmon fishery we show that markets can incentivize the degradation of population diversity reducing infra marginal fishery rents and increasing variability in economic returns we also show that second best management can conserve population diversity and improve welfare furthermore depending on fishermen s time preferences this management strategy is potentially self financing

integrating behavioral choice into epidemiological models of aids increased hiv risk creates incentives for people with low sexual activity to reduce their activity but may make high activity people fatalistic leading them to reduce their activity only slightly or actually increase it if high activity people reduce their activity by a smaller proportion than low activity people the composition of the pool of available partners will worsen creating positive feedbacks and possibly multiple steady states early public health efforts may allow societies to reach more favorable steady states excerpt

a lifetime portfolio of risky and risk free sexual behaviour and the prevalence of aids abstract a lifetime portfolio of risky and risk free sexual activities is conceptually constructed in this paper people s time allocation between risky and risk free sexual activities affects and is affected by the prevalence of aids a small satisfaction differential between risky and risk free sex can lead to a significant prevalence of aids numerical simulations suggest that the reduction in the prevalence of aids generated by a 1 improvement in the sensual quality of freely distributed condoms can be 0 855 when the initial satisfaction differential between risky and risk free sex is 50 or 0 464 when the initial satisfaction differential is 100

information sharing and cooperative search in fisheries we present a dynamic game of search and learning about the productivity of competing fishing locations perfect bayesian nash equilibrium search patterns for non cooperating fishermen and members of an information sharing cooperative are compared with first best outcomes independent fishermen do not internalize the full value of information and do not replicate first best search a fishing cooperative faces a free riding problem as each coop member prefers that other members undertake costly search for information pooling contracts among coop members may mitigate but are not likely to eliminate free riding our results explain the paucity of information sharing in fisheries and suggest regulators use caution in advocating cooperatives as a solution to common pool inefficiencies in fisheries

the rise of europe atlantic trade institutional change and economic growth the rise of western europe after 1500 is due largely to growth in countries with access to the atlantic ocean and with substantial trade with the new world africa and asia via the atlantic this trade and the associatedcolonialism affected europe not only directly but also indirectly by inducing institutional change where initial political institutions those established before 1500 placed significant checks on the monarchy the growth of atlantic trade strengthened merchant groups by constraining the power of the monarchy and helped merchants obtain changes in institutions to protect property rights these changes were central to subsequent economic growth

reforming fisheries lessons from a self selected cooperative we analyze a policy experiment in an alaskan commercial fishery that assigned a portion of an overall catch quota to a voluntary co op with the remainder exploited competitively by those choosing to fish independently unlike the individual quota system advocated by many economists the policy encouraged coordinated fishing and did not require a detailed assignment of rights we model the decision to join and behavior under cooperative and independent fishing the data confirm our key predictions the co op attracted the least skilled fishermen consolidated and coordinated effort among its most efficient members and provided shared infrastructure we estimate that resulting gains in rent were at least 33 percent some independents were disadvantaged by the co op s formation however which prompted them to oppose it in court we analyze the source of their disadvantage and provide guidance for designing fishery reform that leads to pareto improvements enabling reform without losers

occupational choice and the spirit of capitalism the british industrial revolution triggered a socioeconomic transformation whereby the landowning aristocracy was replaced by industrial capitalists rising from the middle classes as the economically dominant group we propose a theory of preference formation under financial market imperfections that can account for this pattern parents shape their children s preferences in response to economic incentives middle class families in occupations requiring effort skill and experience develop patience and a work ethic whereas upper class families relying on rental income cultivate a refined taste for leisure these class specific attitudes which are rooted in the nature of preindustrial professions become key determinants of success once industrialization transforms the economic landscape i introduction the industrial revolution was more than capital accumulation and growth it also set off a social and political transformation that redefined hierarchies in society and reshaped the distribution of income and wealth before the onset of industrialization in eighteenth century britain wealth and political power were associated with the possession of land over the course of the nineteenth century a new class of entrepreneurs and businessmen emerged as the economic elite for the most part the members of this class rose from humble beginnings and had their social origins in the urban middle classes the landed elite was left behind and eventually lost its political and economic predominance many observers of the time linked this reversal in economic fortunes to differences in values attitudes and ultimately preferences across social classes there are countless examples both in scholarly and in fictional writing of portrayals of members of the landowning class as averse to work unwilling to save ill disposed tocommercialactivity andunabletoconsidermoneyassomething

malthusian dynamism and the rise of europe make war not love this paper argues that malthusian regimes are capable of sustained changes in per capita incomes shifting mortality and fertility schedules can lead to different steady state income levels with long periods of growth during the transition europe checked the downward pressure on wages through late marriage which reduced fertility and a mortality regime that combined high death rates with high incomes we argue that both emerged as a result of the black death

measuring benefits from a marketing cooperative in the copper river fishery the degradation of product quality is one form of rent dissipation resulting from incomplete property rights in fisheries industry structure and information asymmetries can also lead to underinvestment in product quality even when property rights are well defined in this article we empirically examine whether the voluntary formation of a marketing cooperative was able to mitigate market failures that led to the production of inferior quality fish specifically we use a difference in differences estimation strategy to measure the impact that the copper river fishermen s cooperative an alaskan salmon marketing cooperative had on ex vessel salmon prices and salmon quality measures we find that the cooperative was able to improve product quality as well as attract and sustain a higher price for its salmon our findings provide empirical support for many of the key tenets of cooperative theory specifically we find evidence that marketing cooperatives can address existing market failures that marketing cooperatives can have advantages in high quality product markets and that over time as a result of their success marketing cooperatives may lead to lasting producer benefits even though they become obsolete due to nonmember free riding

the cambridge history of capitalism this review essay of the two volume cambridge history of capitalism 2014 edited by larry neal and jeffrey g williamson is divided into three parts first i describe three chapters from the second volume that i recommend for all economists to add depth to their understanding of the world economy today robert c allen analyzes the world distribution of income randall morck and bernard yeung discuss the history of business groups and peter lindert surveys private and public programs to help the poor in each case they analyze historical backgrounds that illuminate current issues second i criticize the definition of capitalism used in these volumes as too expansive to be useful i argue that this definition mars the essays in first volume by stimulating a fruitless search for capitalism in the millennium before the industrial revolution third i describe the essays in this reference work starting from the most recent and ending with those about antiquity

peasants procreation and pensions producers and consumers durable goods yielding a stream of benefits which are compared with a stream of costs births occur if the present value of the benefits exceeds the present value of the costs the theory has been used by malthusians to rationalize the casual observation that population growth rates increase during the early stages of economic development and then perhaps fall later on as

how the west invented fertility restriction europeans restricted their fertility long before other parts of the world did so by raising the marriage age of women and ensuring that a substantial proportion remained celibate the european marriage pattern emp reduced childbirths by up to 40 we analyze the rise of this first socio economic institution in history that limited fertility through delayed marriage our model emphasizes changes in agricultural production following the black death the production of meat wool and dairy pastoral products increased while grain production declined women had a comparative advantage producing pastoral goods they often worked as servants in husbandry where they remained unmarried long after they had left the parental household in a malthusian world this translated into lower population pressure raising average wages by up to a quarter the black death thus set into motion a virtuous circle of higher wages and fertility decline that underpinned europe s high per capita incomes we demonstrate the importance of this effect in a calibration of our model

product aggregation market integration and relationships between prices an application to world salmon markets relationships between prices of goods offer motives of interest in at least two areas market integration and product aggregation there is a close relationship between market integration and aggregation which may increase the usefulness of market integration studies in this article these relationships are developed and illustrated by an application to the world salmon market it is shown that the law of one price holds for an international market with five salmon species this result has significant implications for the world salmon market regarding both product aggregation in demand analyses and international trade policy

the future of u s agricultural cooperatives a neo institutional approach thirty years ago helmberger speculated that industrialization of agriculture would lead to the demise of farmer cooperatives helmberger 1966 p 1434 in responding to helmberger s prediction abrahamsen countered by suggesting that as industrialization of agriculture evolved cooperatives would increasingly become the farmer s integrating agency abrahamsen p 1442 in this paper i examine these two divergent opinions by a briefly describing the structural and strategic evolution of u s farmer cooperatives since the helmberger and abrahamsen h a forecasts b utilizing recent developments in neo institutional economic organizational economic theory to generate hypotheses regarding structural and strategic shifts in u s agricultural cooperatives and c further applying neo institutional economics to speculate what the future might hold for u s producerowned and controlled agricultural cooperatives

dynamics and stagnation in the malthusian epoch this paper examines the central hypothesis of the influential malthusian theory according to which improvements in the technological environment during the pre industrial era had generated only temporary gains in income per capita eventually leading to a larger but not significantly richer population exploiting exogenous sources of cross country variations in land productivity and the level of technological advancement the analysis demonstrates that in accordance with the theory technological superiority and higher land productivity had significant positive effects on population density but insignificant effects on the standard of living during the time period 1 1500 ce

the baby boom and world war ii a macroeconomic analysis we argue that one major cause of the u s postwar baby boom was the rise in female labor supply during world war ii we develop a quantitative dynamic general equilibrium model with endogenous fertility and female labor force participation decisions we use the model to assess the impact of the war on female labor supply and fertility in the decades following the war for the war generation of women the high demand for female labor brought about by mobilization leads to an increase in labor supply that persists after the war as a result younger women who reach adulthood in the 1950s face increased labor market competition which impels them to exit the labor market and start having children earlier the effect is amplified by the rise in taxes necessary to pay down wartime government debt in our calibrated model the war generates a substantial baby boom followed by a baby bust

competition between farmed and wild salmon the japanese salmon market this article examines the japanese market for salmon this market is of interest since it is the largest and most diversified salmon market in the world with wild and farmed species from europe and south and north america competing in the same market in contrast to the european union eu and u s markets there have been neither trade conflicts nor trade restrictions the japanese market can hence provide information about the impact of bringing substantial quantities of a new product into a market and the effect of large scale aquaculture on traditional fisheries in this article market integration between wild and farmed salmon on the japanese market is examined using both bivariate and multivariate cointegration analysis tests for the law of one price are also conducted the results indicate that the species are close substitutes on the market and that the expansion of farmed salmon has resulted in price decreases for all salmon species

markets and rent dissipation in regulated open access fisheries abstract using a model of regulated open access resource use with markets we illustrate the potential complexity of interactions between markets product quality excess effort and regulatory behavior in fisheries our model assumes two product types one of which is processed and storable the model describes the equilibrium that results when effort responds to open access incentives and when regulators respond to effort growth by mitigating its potential harmful effects on biomass safety we use numerical simulations to demonstrate a mechanism by which market growth leads to the diversion of raw inputs into the inherently inferior market the result is a scenario in which rents are dissipated not only because excessive inputs raise costs but also because inferior product types reduce revenues we conclude with an illustrative decomposition of rent gains into revenue and cost savings gains from rationalizing a hypothetical fishery demonstrating the potential significance of market side rents

the three horsemen of riches plague war and urbanization in early modern europe how did europe escape the iron law of wages we construct a simple malthusian model with two sectors and multiple steady states and use it to explain why european per capita incomes and urbanization rates increased during the period 1350 1700 productivity growth can only explain a small fraction of the rise in output per capita population dynamics changes of the birth and death schedules were far more important determinants of steady states we show how a major shock to population can trigger a transition to a new steady state with higher per capita income the black death was such a shock raising wages substantially because of engel s law demand for urban products increased and urban centers grew in size european cities were unhealthy and rising urbanization pushed up aggregate death rates this effect was reinforced by diseases spread through war financed by higher tax revenues in addition rising trade also spread diseases in this way higher wages themselves reduced population pressure we show in a calibration exercise that our model can account for the sustained rise in european urbanization as well as permanently higher per capita incomes in 1700 without technological change wars contributed importantly to the rise of europe even if they had negative short run effects we thus trace europe s precocious rise to economic riches to interactions of the plague shock with the belligerent political environment and the nature of cities

long term determinants of the demographic transition 1870 2000 abstract this paper analyzes the long term economic determinants of the demographic transition using a large panel of countries since 1870 a simple theoretical framework accounts for the possibly nonmonotonic variations of fertility in the course of economic development as predicted by unified growth theory i find that primary schooling rather than income or health related variables is the most robust determinant of the fertility transition as regards the health transition both education and income are significant determinants of mortality rates but education alone accounts for the bulk of their time variation over the twentieth century thus education can be viewed as the main long term determinant of the demographic transition

population technology and growth from malthusian stagnation to the demographic transition and beyond this paper develops a unied growth model that captures the historical evolution of population technology and output it encompasses theendogenous transitionbetween three regimes that have characterized economic development the economy evolves from amalthusianregime wheretechnologicalprogressis slow andpopulationgrowthprevents anysustainedriseinincomepercapita intoapost malthusianregime wheretechnological progress rises and population growth absorbs only part of output growth ultimately a demographic transition reverses the positive relationship between income and population growth andtheeconomyentersamoderngrowthregimewithreducedpopulationgrowth

changing world prices women s wages and the fertility transition sweden 1860 1910 this time series analysis examines during 1860 1910 the impact of changes in local prices of agricultural commodities on wages among men and women in sweden and the impact of changes in wages on fertility decline child mortality urbanization and improved social conditions linear ordinary least squares models are set up to determine whether demand induced increases in womens wages relative to mens are significant factors in explaining swedish total fertility rates data are obtained from 25 counties and the city of stockholm among pooled observations for six time periods during 1860 64 and 1910 14 this period is marked by a total fertility decline of 28 a marital fertility decline of 26 and a child mortality decline of 52 explanatory variables are the relative prices of main agricultural outputs employment outside of agriculture the proportion of urban population and the child mortality rate findings indicate a significant relationship between child mortality and total fertility and specific fertility rates among women aged 20 39 years a doubling of the male real wage rate was significantly associated with earlier marriage higher birth rates among women aged 15 29 years and lower birth rates among women aged 35 49 years the ratio of male wages to female wages was associated with a decline in birth rates at all ages with the exception of teenagers 66 of fertility increase was due to declines in child mortality but this increase was counterbalanced by fertility decline among older women child mortality and urbanization depressed marital fertility male wages increased the proportion married a 10 increase in the male female wage rate was associated with a 25 reduction in the total fertility rate another 25 increase in the male female wage rate was associated with a 50 reduction in child mortality it is concluded that the value of womens time had a key impact on the swedish fertility transition

how relevant is malthus for economic development today the malthusian model of population and economic growth has two key components first there is a positive effect of the standard of living on the growth rate of population resulting either from a purely biological effect of consumption on birth and death rates or a behavioral response on the part of potential parents to their economic circumstances second because of the existence of some fixed resource such as land there is a negative feedback from the size of population to the standard of living these two components generate a number of predictions specifically in the absence of technological change or expansion in the stock of the fixed resource population will be stable around a constant level second without changes in the function generating population growth technological improvements or increases in the stock of resources will eventually result in more people but not a higher standard of living as a description of population income interactions the malthusian model had a long period of success covering most of human history in most of the world until the beginning of the industrial revolution in this paper we ask whether the model has any relevance to the world today for the first part of the model the positive causality running from income to population growth the answer is clearly no for reasons that have not fully been determined countries that get richer now see falling rather than rising rates of population growth regarding the second part of the model whether higher population lowers the standard of living some further clarification is required before we can even pursue this issue first it important to differentiate among the different channels through which population affects economic outcomes we will characterize as non malthusian those channels that work through the growth rate or demographic structure of the population these include the effect of population growth in diluting capital per worker the effect of the population age structure itself a function of fertility on the ratio of working age adults to dependents the association of lower fertility with higher human capital investment via a quality quantity mechanism and the effect of lower fertility in freeing up female labor for output production we reserve the term malthusian for channels having to do with the size of the population such as the congestion of fixed resources this channel was the one malthus thought about and it is also the only one that pins down the level of population in steady state which matches historical experience thus in our typology it is perfectly possible for reductions in population growth to raise income per capita even though the malthusian channel is irrelevant a second issue to be clarified is at what geographic scale we are looking it is possible that in a world with trade a high level of population in a single country will not lower that country s income relative to others but that a world with more people will be worse off because of congestion of productive resources or the environment we do not pursue that possibility here instead we ask whether there are countries or subnational regions in the world where the local version of malthusianism hold true the likeliest place to look for malthusian effects is among poor countries for several reasons first poor countries have had and are continuing to have the largest increases in population the population of africa is expected to multiply by a factor of 9 8 between 1950 and 2050 in india during the century of most rapid population growth 1920 2020 population is expected to multiply by a factor of 5 5 by contrast in europe over the period 1800 1900 roughly the century of fastest population growth population increased by a factor of 2 2 if the initial population in these regions represented some equilibrium in the relation between population and resources given available technology the more rapid population growth is more likely to result in a disequilibrium in this relationship second poor countries are least able to use trade as a means of avoiding resource constraints finally as discussed further below poor countries empirically have much higher shares of natural resource rents in national income than do rich countries the idea that poor countries might suffer negative economic effects from overpopulation has a long pedigree however in recent decades the malthusian perspective has fallen out of favor among development economists who have stressed the substitutability of technology capital and labor for fixed factors as well as the productive benefits of density per se or of the technological and institutional changes induced by population pressure see allen c kelley 2001 we take as an operative test of the malthusian channel the answer to the question if a country had fewer people but was otherwise unchanged in terms institutions human and physical capital per capita productivity terms of trade etc would it be significantly better off in per capita terms

the condition of the working class in england 1209 2004 i use building workers wages for 1209 2004 and the skill premium to consider the causes and consequences of the industrial revolution real wages were trendless before 1800 as would be predicted for the malthusian era comparing wages with population however suggests that the break from the technological stagnation of the malthusian era came around 1640 long before the classic industrial revolution and even before the arrival of modern democracy in 1689 building wages also conflict with human capital interpretations of the industrial revolution as modeled by gary becker kevin murphy and robert tamura oded galor and david weil and robert lucas human capital accumulation began when the rewards for skills were unchanged and when fertility was increasing

the micro evidence for the malthusian system france 1670 1840 abstract i test the assumptions of the malthusian model at the individual cross sectional level for france 1650 1820 using husband s occupation from the parish records of 41 french rural villages i assign three different measures of status there is no evidence for the existence of the positive check infant deaths are unrelated to status however the preventive check operates strongly acting through female age at first marriage the wives of rich men are younger brides than those of poorer men this drives a positive net fertility gradient in living standards however the strength of this gradient is substantially weaker than it is in pre industrial england

technological change and inequality in the very long run abstract in this paper we investigate the impact of technological change on inequality in the presence of a landed elite using a standard unified growth model we measure inequality by the ratio between land rent and wages and show that before the onset of the fertility transition technological progress increased inequality directly through land biased technological change and indirectly through increasing population growth the fertility transition and the child quantity quality trade off eventually disabled the malthusian mechanism and technological progress triggered education and benefited workers if the elasticity of substitution between land and labor is sufficiently high the rent wage ratio declines such that inequality is hump shaped in the very long run we use the publication of new farming book titles as a measure of technological progress in agriculture and provide evidence for technology driven inequality in britain between 1525 and 1895 we confirm these results for a panel of european countries over the period 1265 1850 using agricultural productivity as a measure of technology finally using patents in the period 1800 1980 we find a technology driven inequality reversal around the onset of the fertility transition

information asymmetry as a reason for food industry vertical integration three trends that have been subject to recent discussion are a movement away from undifferentiated agricultural commodities toward more specialized products reduced reliance on open markets for raw agricultural products and a movement toward agricultural industrialization recent research suggests that demographic trends may be causing the first trend while the other two are closely related phenomena this research suggests that information externalities arising from uncertainty concerning the nature of food quality and problems in detecting quality may be reasons why vertical coordination is being used to circumvent the marketplace

malthus to solow a unified growth theory is developed that accounts for the roughly constant living standards displayed by world economies prior to 1800 as well as the growing living standards exhibited by modern industrial economies our theory also explains the industrial revolution which is the transition from an era when per capita incomes are stagnant to one with sustained growth the authors use a standard growth model with several technologies the first denoted the malthus technology requires land labor and reproducible capital as inputs the second denoted the solow technology does not require land the authors show that in the early stages of development only the malthus technology is used and due to population growth living standards are stagnant despite technological progress eventually technological progress causes the solow technology to become profitable and both technologies are employed at this point living standards improve since population growth has less influence on per capita income growth in the limit the economy behaves like a standard solow growth model excerpt