non use values and the management of transboundary renewable resources abstract it has long been recognized in economics that individuals can derive benefits from a resource stock without directly or indirectly utilizing that resource such non use values including existence values and bequest values are often ignored in models of resource management in this paper a simple two country model of the management of a renewable resource is developed in which at least one country has a non economic interest in the conservation of the fish stock to examine the impact of such a non use value on the end of period harvest and self enforcing sharing rule the model shows that this non lucrative pursuit serves to decrease the total allowable catch for each period at the expense of the catch share of the more conservation oriented country a result that is consistent with the september 1995 decision by nafo ending the dispute between canada and the eu over turbot

a life course trajectory framework for understanding the intracohort pattern of wage inequality much research has been devoted to cross sectional and intercohort patterns of wage inequality but relatively little is known about the mechanisms for the intracohort pattern of wage inequality to fill this intellectual gap this article establishes a life course trajectory lct framework for understanding the intracohort pattern of wage inequality first the author proposes and conceptualizes three essential properties of the lct framework random variability trajectory heterogeneity and cumulative advantage that are used to establish a mathematical formalization of the lct framework both the conceptualization and the formalization imply that intracohort wage inequality will increase over the life course due to random variability trajectory heterogeneity and cumulative advantage finally the author combines the lct framework with the multilevel growth curve model then applies the model to data from the nlsy79 and finds support for the significance of random variability trajectory heterogenei

does altruism undermine existence value abstract the debate over the use of contingent valuation for existence values or passive use values has failed to explore the validity of motives for such values one potential motive altruism has conflicting implications for benefit cost analysis depending on whether the altruist is paternalistic this paper constructs models of three types of altruism and shows how benefit cost analysis responds to each type of altruism how damage assessment and restoration depend on each type and the implications of a population of heterogeneous altruists

educational assortative mating and earnings inequality in the united states1 this article investigates how changes in educational assortative mating affected the growth in earnings inequality among households in the united states between the late 1970s and early 2000s the authors find that these changes had a small negative effect on inequality there would have been more inequality in earnings in the early 2000s if educational assortative mating patterns had remained as they were in the 1970s given the educational distribution of men and women in the united states educational assortative mating can have only a weak impact on inequality and educational sorting among partners is a poor proxy for sorting on earnings

the care economy gender economic restructuring and job polarization in the u s labor market the u s job structure became increasingly polarized at the turn of the twenty first century as high and low wage jobs grew strongly and many middle wage jobs declined prior research on the sourc

educational assortative mating and household income inequality we use data from denmark germany norway the united kingdom and the united states to document the degree of educational assortative mating how it evolves over time and the extent to which it d

social class and income inequality in the united states ownership authority and personal income distribution from 1980 to 2010 this study outlines a theory of social class based on workplace ownership and authority relations and it investigates the link between social class and growth in personal income inequality since the 1980s inequality trends are governed by changes in between class income differences changes in the relative size of different classes and changes in within class income dispersion data from the general social survey are used to investigate each of these changes in turn and to evaluate their impact on growth in inequality at the population level results indicate that between class income differences grew by about 60 since the 1980s and that the relative size of different classes remained fairly stable a formal decomposition analysis indicates that changes in the relative size of different social classes had a small dampening effect and that growth in between class income differences had a large inflationary effect on trends in personal income inequality

earnings inequality and the changing association between spouses earnings increases in the association between spouses earnings have the potential to increase inequality as marriages increasingly consist of two high earning or two low earning partners this article uses log linear models and data from the march current population survey to describe trends in the association between spouses earnings and estimate their contribution to growing earnings inequality among married couples from 1967 to 2005 the results indicate that increases in earnings inequality would have been about 25 30 lower than observed in the absence of changes in the association depending on the inequality measure used three components of these changes and how they vary across the earnings distribution are explored

racial inequality trends and the intergenerational persistence of income and family structure racial disparity in family incomes remained remarkably stable over the past 40 years in the united states despite major legal and social reforms previous scholarship presents two primary explanations for persistent inequality through a period of progressive change one highlights continuity because socioeconomic status is transmitted from parents to children disparities created through histories of discrimination and opportunity denial may dissipate slowly the second highlights change because family income results from joining individual earnings in family units changing family compositions can offset individuals changing economic chances i examine whether black white family income inequality trends are better characterized by the persistence of existing disadvantage continuity or shifting forms of disadvantage change i combine cross sectional and panel analysis using current population survey panel study of income dynamics census and national vital statistics data results suggest that african americans experience relatively extreme intergenerational continuity low upward mobility and discontinuity high downward mobility both helped maintain racial inequality yet intergenerational discontinuities allow new forms of disadvantage to emerge on net racial inequality trends are better characterized by changing forms of disadvantage than by continuity economic trends were equalizing but demographic trends were disequalizing as family structures shifted family incomes did not fully reflect labor market gains

analysis of a forecasting production inventory system with stationary demand we consider a production stage that produces a single item in a make to stock manner demand for finished goods is stationary in each time period an updated vector of demand forecasts over the forecast horizon becomes available for use in production decisions we model the sequence of forecast update vectors using the martingale model of forecast evolution developed by graves et al 1986 1998 and heath and jackson 1994 the production stage is modeled as a single server discrete time continuous state queue we focus on a modified base stock policy incorporating forecast information and use an approximate analysis rooted in heavy traffic theory and random walk theory to obtain a closed form expression for the forecast corrected base stock level that minimizes the expected steady state inventory holding and backorder costs this expression which is shown to be accurate under certain conditions in a simulation study sheds some light on the interrelationships among safety stock stochastic correlated demand inaccurate forecasts and random and capacitated production in forecasting production inventory systems

on the benefits of pooling in production inventory systems we study inventory pooling in systems with symmetric costs where supply lead times are endogenously generated by a finite capacity production system we investigate the sensitivity of the cost advantage of inventory pooling to various system parameters including loading service levels demand and production time variability and structure of the production system the analysis reveals differences in how various parameters affect the cost reduction from pooling and suggests that these differences stem from the manner in which the parameters influence the induced correlation between lead time demands of the demand streams we compare these results with those obtained for pure inventory systems where lead times are exogenous we also compare inventory pooling with several forms of capacity pooling

income inequality and income segregation this article investigates how the growth in income inequality from 1970 to 2000 affected patterns of income segregation along three dimensions the spatial segregation of poverty and affluence race specific patterns of income segregation and the geographic scale of income segregation the evidence reveals a robust relationship between income inequality and income segregation an effect that is larger for black families than for white families in addition income inequality affects income segregation primarily through its effect on the large scale spatial segregation of affluence rather than by affecting the spatial segregation of poverty or by altering small scale patterns of income segregation

valuing riverside wetlands the case of the donau auen national park abstract for two decades the establishment of the donau auen national park east of vienna has been on the political agenda in austria since 1991 concrete proposals have been worked out for several variants of a national park including hydraulic engineering concepts and hydroelectric power stations within this planning process a cost benefit analysis was carried out to estimate the economic impacts of the proposed projects one crucial question was how to value the ecological quality of wetlands these environmental goods were valued by means of a willingness to pay wtp survey two different kinds of variables were defined 1 costs and benefits depending on direct anthropocentric use including energy production with hydroelectric power stations shipping groundwater protection stabilisation of the river bed to stop channel erosion visitors benefits forestry farming fishing hunting and the costs of establishing a national park based on these variables the net present value for variants with hydroelectric power stations is higher than for variants without electricity production on the contrary the internal interest rate and the benefit cost ratio is higher for a pure national park without electricity production 2 taking also the austrians wtp for the donau auen national park as a substitute measure for ecological values into account only 20 percent of the wtp which was measured by means of contingent valuation is needed to make the net present value of the best national park variant equal to that of the best hydroelectric power variant this shows that the protection of natural goods like wetlands in a natural state might be more efficient from an economic viewpoint than development projects

nonuse values in benefit cost analysis benefit cost analysis bca is a pragmatic realization of the theory of welfare economics much of the research associated with bca has sought to expand the types of benefits that can be measured in dollar terms with this research there has been a progressive movement of goods and services from the set without measures usually designated as intangibles in bca terminology to the set with for example the recreational services provided by projects associated with dams for hydroelectric power or flood control were regarded as intangible until the development of the travel cost model for estimating the demand for outdoor recreation sites one of the current frontiers in bca research is associated with modeling and measuring nonuse benefits in contrast to the past efforts with intangibles research on this topic has remained controversial with few direct effects on the practice of applied welfare economics there are two principal reasons for this outcome first there has not been an accepted set of definitions for nonuse benefits and second applied studies with empirical estimates of nonuse benefits have until recently been non existent clearly these problems are related a consistent set of definitions is a necessary prerequisite for empirical implementation i will argue that consistent definitions for nonuse benefits have been elusive because the conceptual frameworks used in the literature to describe its primary components option value and existence values are not mutually consistent in the process of demonstrating this result i will describe the elements of a consistent framework for treating both use and nonuse benefits and apply it in explaining some of the problems with the available empirical estimates of nonuse benefits

family change employment transitions and the welfare state household income dynamics in the united states and germany since the demise of modernization theory social scientists have sought explanations for persisting differences in the stratification of industrialized societies primarily by studying how educational and labor market institutions shape the life chances of individuals this approach undervalues two key features of any stratification system family dynamics and the welfare state employment changes changes in household composition and changes in the employment situation of a spouse or partner can all trigger large shifts in income and material well being the impact of these events is mediated by public tax and transfer mechanisms and by private actions taken by household members this comparative analysis of household income dynamics in the united states and germany shows that variations in welfare state policy produce distinct societal patterns of income mobility and furthermore shows that the relative importance of labor market events family change and welfare state policies for income dynamics depends on gender the strong interrelationship between individual incentives and the structure of opportunity produces an asymmetry in the long term impact of events the negative effects of events that reduce income generally decay over time while the effects of positive events generally persist

the impact of the changing us family structure on child poverty and income inequality this paper analyses links between rising income inequality child poverty and one parent families in the united states from 1971 to 1989 one test reallocated weights so that 1989 proportions of children by mothers marital status resembled the 1971 distribution a second method used 1 simulated marriages among unmarried men and unmarried mothers in 1989 to reproduce 1971 marital patterns and 2 earnings responses induced by the simulated marriages the results indicate that the trend away from marriage accounted for almost half the increase in child income inequality and more than the entire rise in child poverty rates excerpt

the role of inventory in delivery time competition the paper operationalizes the notion of shortage cost by considering the behavior of customers and competing firms and examines the role of inventory in response time competition we start with a single firm production control model in which customers are characterized by their preferences of price quality and delivery time the optimal production inventory policy and the optimal choice between make to order and make to stock operations are determined in simple newsboy like formulas the basic model is then extended to an n firm market game in which firms compete for orders from the aspect of early delivery one could think of this setting as an oligopoly racing market the analysis shows that competition can breed a demand for produce to stock just as other economic phenomena such as economies of scale uncertainty or seasonality can induce make to stock and that delivery time competition increases the buyer s welfare while decreasing the producer s welfare

anti poverty policy for families in the next century from welfare to work and worries this paper reveals that recent changes in social policy have included both sharp cutbacks in welfare for non working families and dramatic increases in supports for low income working families it explores the reasons for these changes and documents how they have radically changed work incentives for some persons notable single mothers the result has been a large increase in work by low wage single parents the paper concludes by examining several potential dangers of this new direction and explores the challenges that remain for the next century

on visible choice sets and scope sensitivity abstract in this paper we argue that the burgeoning empirical debate over scope sensitivity within contingent valuation studies is fundamentally incomplete in that it has neglected a systematic examination of certain effects of study design upon observed scope sensitivity in particular we highlight the fact that in certain study designs the choice set initially offered or visible to respondents is changed in a stepwise manner as they progress through a valuation exercise while other designs involve advance disclosure regarding the full extent of the final visible choice set prior to any choices or values being elicited the issue of changes in the visible choice set is alluded to by smith j environ econom manage 22 1 71 who identifies this as a primary challenge to kahneman and knetsch s j environ econom manage 22 1 57 well known experimental results kahneman and knetsch contend that it seems highly implausible that this minor procedural change would significantly alter results p 61 but do not test this assertion we present experimental and field tests of the impact upon contingent values of varying the visible choice set through stepwise and advance disclosure these dimensions of design are interacted with changes in the order in which nested goods are presented bottom up versus top down when a stepwise disclosure procedure is adopted the observed scope sensitivity is substantially and significantly affected by the order in which goods are presented but such procedural variance is not observed within advance disclosure designs conjectures regarding the origin and implications of such findings are presented

how network externalities can exacerbate intergroup inequality the authors describe a common but largely unrecognized mechanism that produces and exacerbates intergroup inequality the diffusion of valuable practices with positive network externalities through social networks whose members differentially possess characteristics associated with adoption the authors examine two cases the first to explore the mechanism s implications and the second to demonstrate its utility in analyzing empirical data in the first the diffusion of internet use network effects increase adoption s benefits to associates of prior adopters an agent based model demonstrates positive monotonic relationships given externalities between homophily bias and intergroup inequality in equilibrium adoption rates in the second rural urban migration in thailand network effects reduce risk to persons whose networks include prior migrants analysis of longitudinal individual level migration data indicates that network homophily interacts with network externalities to induce divergence of

inequality among american families with children 1975 to 2005 from 1975 to 2005 the variance in incomes of american families with children increased by two thirds in attempting to explain this trend labor market studies emphasize the rising pay of college graduates while demographers typically highlight the implications of family structural changes across time in this article we join these lines of research by conceiving of income inequality as the joint product of the distribution of earnings in the labor market and the pooling of incomes in families we develop this framework with a decomposition of family income inequality using annual data from the march current population survey our analysis shows that disparities in education and single parenthood contributed to income inequality but rising educational attainment and women s employment offset these effects most of the increase in family income inequality was due to increasing within group inequality which was widely shared across family types and levels of schooling

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

inequality and poverty in united states the effects of rising dispersion of men s earnings and changing family behaviour using semiparametric density estimation techniques we analyse the effect of rising dispersion of men s earnings and related changes in family behaviour on increasing inequality in the distribution of family income in the united states for the period 1969 1989 the growing dispersion of men s earnings and changing family structure can account for most of the rise in family income inequality by contrast the increase in labour force participation by women offset this trend inequality grew at a slower rate in the 1990s than in earlier decades largely because of stabilization in the relative earnings of men from low income families

setting base stock levels using product form queueing networks a manufacturing facility produces multiple products in a make to stock manner and unsatisfied demand is backordered a simple production control policy is analyzed when the amount of work in process inventory plus finished goods inventory for a particular product falls below a base stock level then release another unit of that product onto the shop floor assuming that the work in process inventory has a steady state distribution and that there are different costs incurred for carrying in process completed and backordered units we show that the cost minimizing base stock level for each product is a critical fractile of the steady state distribution of the product s total work in process inventory by exploiting the relationship between the make to stock system and an open queueing network we identify specific formulas for the base stock levels under standard product form assumptions for the lost sales case a similar relation to a closed queueing network can be used to characterize the optimal cont

skill biased technological change and wage inequality evidence from a plant retooling1 one of the most popular explanations for the increased wage inequality that has occurred since the late 1970s is that technological change has resulted in a downward shift in the demand for low skill workers this pattern is also alleged to account for the growth in racial inequality in wages over the same period this article reports on a case study of the retooling of a food processing plant a unique longitudinal multimethod design reveals the nature of the technological change the changes in job requirements and the mechanisms by which the changes affect the wage distribution for hourly production workers this research finds that indeed the retooling resulted in greater wage dispersion and that the changes have also been associated with greater racial inequality in wages however contrary to the claims of advocates of the skill bias hypothesis organizational and human resources factors strongly mediated the impact of the changing technology absent these high road organizational choices th

revenue management of a make to stock queue motivated by recent electronic marketplaces we consider a single product make to stock manufacturing system that uses two alternative selling channels long term contracts and a spot market of electronic orders at time 0 the risk averse manufacturer selects the long term contract price at which point buyers choose one of the two channels the resulting long term contract demand is a deterministic fluid while the spot market demand is modeled as a stochastic renewal process an exponential reflected random walk model is used to model the spot market price which is correlated with the spot market demand process the manufacturer accepts or rejects each electronic order and long term contracts and accepted electronic orders are backordered if necessary the manufacturer s control problem is to select the optimal long term contract price as well as the optimal production i e busy idle and electronic order admission policies to maximize revenue minus inventory holding and backorder costs under heavy traffic conditions the problem is approximated by a diffusion control problem and analytical approximations are used to derive a policy that is simple and reasonably accurate and robust

inequality in children s contexts income segregation of households with and without children past research shows that income segregation between neighborhoods increased over the past several decades in this article i reexamine income segregation from 1990 to 2010 in the 100 largest metropolitan areas and i find that income segregation increased only among families with children among childless households two thirds of the population income segregation changed little and is half as large as among households with children i examine two factors that may account for these differences by household composition first i find that increasing income inequality identified by past research as a driver of income segregation was a much more powerful predictor of income segregation among families with children among whom income inequality has risen more second i find that local school options delineated by school district boundaries contribute to higher segregation among households with children compared to households without rising income inequality provided high income households more resources

existence values in benefit cost analysis and damage assessment existence values for obscure resources should not be ruled out a priori because consumers have limited time and resources for information gathering furthermore to the extent that environmental good things are highly substitutable existence values must be cautiously interpreted when evaluating public choice alternatives but similar concerns do not arise in damage assessments issues associated with adding up existence values across resources high per unit values and property rights in the existence of resources are also addressed

the role of property rights in economic research on u s wetlands policy abstract the purpose of this essay is to define the role of resource economics in the development of u s wetlands policy i argue that the optimal pollution model based on maximation of net benefits of wetland protection is for the most part not directly applicable to the creation of wetlands policy for two reasons 1 the delineation of property rights among wetland owners and the general public as opposed to the maximization of net benefits is the more fundamental political issue and therefore drives policy making 2 the predominant public benefits of wetlands fall into the economic category of nonuse values which are very difficult to define and measure in a policy relevant way and the public s legal rights to them have not been established these conclusions indicate that resource economics research that focuses upon 1 the economic significance to interested parties of alternative delineations of property rights 2 development of policy tools appropriate for each possible property rights delineation and 3 the relative cost effectiveness of these policy tools is most useful for policy making

test retest reliability of the contingent valuation method a comparison of general population and visitor responses the reliability of the contingent valuation method is evaluated by resurveying the same general households and visitors nine months after their original survey test retest correlations on willingness to pay are statistically significant and ranged from 422 for the general population sample to 782 for the visitor sample using a paired t test there was no statistical difference between an individual s first and second reported willingness to pay chow tests comparing the original and resurvey willingness to pay functions showed no statistical difference at the 01 level reported willingness to pay is reasonably stable over the time period surveyed

the case for diminishing marginal existence values abstract this study addresses the debate over sensitivity of existence values measured by contingent valuation to scope tests we reconcile much of the debate within one theoretical model if marginal wtp for existence goods is diminishing then a study that tested for sensitivity to scope over a range for which marginal wtp is high would be more likely to detect sensitivity to scope than a study that focused on a range for which marginal wtp is much lower an empirical model demonstrates this point for existence value of remote wilderness parks these results have significant implications for future contingent valuation work