adoption of new tobacco varieties in greece impacts of empirical findings on policy design abstract greece is a major international tobacco producer flue cured tobacco varieties constituted the major alternative crop to greek farmers growing certain oriental tobacco varieties diffusion of flue cured tobacco was rapid due to its high yields and the depressed market for certain oriental tobacco varieties currently the common organisation of the tobacco market is undergoing substantial changes and the farmers response will be a vital factor of success a portfolio selection model reveals that the major factors influencing the adoption decision of tobacco growers are the size of the farm measured in annual work units the farm s proximity to urban centres the farm s diversification and the farmer s age the number of contacts with institutions is surprisingly inversely related to adoption future tobacco policies impinging on factors influencing decisions to adopt new varieties or production practices may be more cost effective

factors determining intercropping by rubber smallholders in sri lanka a logit analysis abstract variables related to farmers awareness and attitudes towards intercropping of immature rubber hevea brasiliensis stands extension contacts education level and experience with farming other crops are positively associated with the probability of adoption higher levels of off farm income are associated with reduced intercropping in immature rubber stands farmers who are sole owners of the land and engaged in full or part time rubber farming show lower adoption rates than other land ownership groups social participation family size experience with farming rubber immature and mature rubber stands size and the nature of the land flat sloped do not significantly influence adoption these conclusions were obtained from a logit model estimated by employing the results of a survey of 588 smallholder rubber farmers from five major rubber growing regions in sri lanka

tenure land rights and farmer investment incentives in china the goal of this paper is to understand the nature of the property rights associated with china s land tenure systems and to study the impact of these property rights on agricultural production efficiency the results show that land tenure and associated property rights in rural china affect the production behavior of farmers the most robust finding is that the right to use land for long periods of time encourages the use of land saving investments while the results show that land tenure affects agricultural production decisions the difference between collective and private plots however is small compared to the private plotcommunal productivity gap that existed in the pre reform period 1998 elsevier science b v all rights reserved

post reform forestland markets in china land markets developed rapidly in china after agricultural land tenure reforms but not after forest reforms we surveyed farmers in three provinces to examine the post reform forestland markets and options to strengthen them using household choice experiments we estimate land market demand and supply under alternative contractual arrangements our findings are consistent with the currently thin markets but also suggest that alternative institutional and contractual conditions could support broader participation in land markets strengthening property rights on forestland emerges as an especially effective possible policy instrument we illustrate its predicted effects on equilibrium rental rates and market participation

durable goods monopolists durable goods monopolists face special problems because the sale of their products creates a secondhand market not controlled by the monopolist to the extent the monopolist is able to rent his product rather than sell it or to make binding promises about his future production such problems are ameliorated given the inability to do the above the monopolist is led to producing goods less durable than those produced by either competitive firms or monopolist returns a reverse averch johnson result that monopolist sellers may invest less in fixed costs including plant modernization and research and development than would the renters is shown it is also shown that even though sellers have less monopoly power than renters and nondurable goods monopolists it is possible that the seller will cause a greater deadweight loss than the other types of monopolies

the household responsibility system in china s agricultural reform a theoretical and empirical study the emergence and eventual prevalence of the household responsibility system which replaces the production team system as the unit of production and income distribution has brought about dramatic changes in china s rural areas since 1979 this institutional change has resulted in remarkable growth in agricultural productivity however in the literature on collective farms a theory that is capable of explaining the causes and effects of this change is yet to be developed the formal theory about collective economies developed so far by ward domar sen oi and clayton bradley maurice and ferguson cameron bonin chinn israelsen putterman and others suggests that the allocation of resources in a collective farm is efficient at least in

land rental development via institutional innovation in rural jiangsu china previous studies have demonstrated that there are two important preconditions for encouraging land rental in agriculture out migration and the enhancement of security and transferability of land rights focusing on the latter we scrutinize the impacts of institutions aimed at facilitating land use dynamism particularly the rural shareholding cooperatives rscs which have been established recently at the local level in rural china in general we find that rscs can pave the way for the extension of property rights to farmland and promote more efficient land use patterns using survey data collected from 300 village committees in rural jiangsu province we estimate the effectiveness of rscs in encouraging land rental our analysis reveals that rscs can serve as intermediate agents for reducing transaction costs associated with exchange of land use rights and thereby not only encourage land rental consolidation activities but also enable the entry of non farm household entities into the farm business

human capital producer education programs and the adoption of forward pricing methods using a sample of 509 kansas producers we evaluate factors affecting adoption of forward pricing methods we focus on producers human capital accumulation and its effect on adoption of forward pricing techniques probit models are employed to evaluate producers participation in educational programs and their forward pricing adoption decisions tobit models are employed to evaluate individual levels of adoption of these techniques in the marketing of wheat corn grain sorghum soybeans and cattle

market based empirical research in accounting a review interpretation and extension a decade and a half of the most concerted and ambitious research effort in accounting history is evaluated here it is the search into the relationship between publicly disclosed accounting information and the consequences of the use of this information by the major group of usersequity investors as such consequences are reflected in characteristics of common stocks traded in major exchanges this research effort known as market based accounting research mbar obtained its impetus from major developments in finance theory during the late 1950s and early 1960s these were the portfolio selection theory and its offspring the capital asset pricing model capm and the concept of informationally efficient capital markets ecm subsequent developments in information economics agency theory and optimal incentive signaling models were quickly incorporated into mbar while the impetus to this line of research came from other disciplines accounting was not only a beneficiary but also to a modest extent a benefactor mbar is relevant to the study of capital market efficiency the capm information economics and regulation this contribution distinguishes mbar from most accounting areas whose contributions to other disciplines are negligible in

accounting for retail land sales analysis of a mandated change abstract this study assesses the stock market s reaction to a series of events leading up to a mandated change in accounting for retail land sales evidence is found to support the conclusion that the market reacted to some of these events in a manner consistent with the effects of the accounting change on debt annagement contracts a distinctive aspect of the analysis is the efficient use of security returns data to detect market reactions and to derive empirical distributions of test statistics employed the analysis is extended by a model for grouping regression equations known as seemingly unrelated regressions however the gains from this extension are modest

knowledge diffusion input supplier s technological effort and technology transfer via vertical relationships this paper studies the effect of knowledge diffusion on the incentives for developed countries dc firms to undertake costly technology transfer to their less developed countries ldc suppliers whose cost of production varies inversely with their technological effort when the incumbent supplier s cost of improving efficiency is high diffusion of knowledge to other potential input producers encourages technology transfer as it increases upstream competition however and in sharp contrast to existing literature when technological effort is less costly knowledge diffusion discourages technology transfer by reducing the incumbent supplier s technological effort

foundations of dynamic monopoly and the coase conjecture subgame perfect equilibria are characterized for a market in which the seller quotes a price each period assume zero costs positive interest rate continuum of buyers and some technical conditions if buyers valuations are positive then equilibrium is unique buyers strategies are stationary and the price sequence is determinant along the equilibrium path but possibly randomized elsewhere otherwise a continuum of stationary equilibria can exist but at most one with analytic strategies coase s conjecture is verified for stationary strategies reducing the period length drives all prices to zero or the least valuation connections to bargaining models are described journal qf economic literature classification

bank foreign lending mandatory disclosure rules and the reaction of bank stock prices to the mexican debt crisis this paper examines the effects of the mexican debt mora torium in august 1982 on bank valuation the mexican default resulted in the passage of regulations requiring public disclosure of bank fo reign lending exposure the authors find that even in the absence of public disclosure regulations investors were able to discriminate a mong banks with different levels of exposure copyright 1987 by the university of chicago

dimensions and diversity of property rights in rural china dilemmas on the road to further reform abstract this paper contributes to the debate over land tenure in rural china by conceptualizing and measuring multiple dimensions of property rights in a way that elucidates the competing interests that are affected by the property rights regime utilizing a unique village level data set this paper argues that the regional and temporal variation in rural property rights signals a pattern in which decentralized institutional innovation occurs in response to the competing interests of the national state of local authorities and of present and possible future individual land users unlike the earlier debate concerning the household responsibility system the current property rights dilemma is intrinsically more complex because the potential conflicts of interest between individuals local collectives and the state are greater resolution of that debate will ultimately require careful exploration of the reality and substance of the tradeoffs and competing interests that make further reform of rural property rights so difficult

bank portfolio exposure to emerging markets and its effects on bank market value abstract this study estimates a model of banking company equity returns taking into consideration book value and market value measures of their exposure to emerging markets debt in this estimation general systematic market factors such as the rate of return on the s p500 stock index and yields on a constant maturity 5 year treasury note are held constant such that the exposure variables are accounting for effects due to banks exposure to emerging market debt the results although not uniform among banking companies support the hypothesis that the extent of exposure to emerging market debt are factored into the valuation of banking company equity contemporaneously the inclusion of a market value indicator adds to the explanation of equity returns of some banks it is also clear that knowing the extent of the exposure on a book value basis is important information alone that may allow investors to take account of or evaluate the effects of changes in banking company equity valuation from ldc debt exposures we also perform an event study for three major debt crises to determine whether the market recognizes the effects of these events on bank valuation the event study results show that there is little information from identifying the time period of the crises on banking company equity returns explanations for this are that the information of these possible crises has been embedded in bank changes in exposure and that the market valuation of the emerging market debt is already accounted for by our model

strategic resource dependence we consider a situation where an exhaustible resource seller faces demand from a buyer who has a substitute but there is a time to build delay for the substitute we find that in this simple framework the basic implications of the hotelling model 1931 are reversed over time the stock declines but supplies increase up to the point where the buyer decides to switch under such a threat of demand change the supply does not reflect the current resource scarcity but it compensates the buyer for delaying the transition to the substitute the analysis suggests a perspective on costs of oil dependence

a policy agenda for pro poor agricultural growth abstract sub saharan africa and parts of south asia are likely to hold large numbers of very poor rural people into the foreseeable future although both history and theory suggest a pre eminent role for agricultural growth in poverty reduction in poor agrarian economies such growth today faces new difficulties many of these difficulties are endogenous to today s poor rural areas others result from broader processes of global change but some are due to changes in the dominant policy environment emphasizing liberalization and state withdrawal examination of 20th century green revolutions suggests that active state interventions were important in supporting critical stages of agricultural market development unfortunately such interventions benefits in institutional development are easily overlooked whereas their high costs are much more visible policy implications are discussed

market evidence on the effective maturity of bank assets and liabilities the recent years increase in interest rate volatility has intensified concern over the exposure of commercial banks to interest rate or funding risk since the effect of interest rate changes on the equity value of a bank depends on the maturity or duration of the bank s assets and liabilities assessing an individual bank s interest rate risk exposure requires information about the maturity composition of its portfolio it is difficult however to assess a bank s risk exposure from balance sheet data because several important asset and liability items have theoretically ambiguous effective maturities in a frictionless market a security s effective maturity will equal its stated maturity or time to repricing with market imperfections e g depositors transaction or information costs however the equilibrium cost of some deposit items may respond sluggishly or incompletely to market rate changes see hester and pierce 1975 or flannery 1982 such liabilities market values discounted at market rates would therefore fluctuate with the level of interest rates these liabilities are sometimes called core deposits which manifest sticky responses to market rate changes we define an asset or liability s effective maturity as the maturity of a fixed rate perfectly elastically supplied security with the same market value elasticity as the bank balance sheet item under consideration naturally a balance sheet item s effective maturity is the relevant determinant of its contribution to the bank s overall interest rate risk sensitivity

human capital adjustments in subjective probabilities and the demand for pest controls in addition to risk aversion farmer behavior in an uncertain environment is governed by subjective probability estimates of random events the estimates given here lend support to the idea that human capital development can improve farmers ability to estimate pest damage probabilities more accurate assessment of subjective probabilities leads to lower pesticide use and increases the use of labor intensive pest controls the human capital variables with the largest effects are formal schooling and farmer experience with smaller impacts from field scouting and extension schools

adoption of agricultural innovations in developing countries a survey this paper reviews various studies which have provided a description and possible explanation to patterns of innovation adoption in the agricultural sector the survey points out that the tendency of many studies to consider innovation adoption in dichotomous terms adoption nonadoption may not be appropriate in many cases where the actual decisions are defined over a more continuous range more attention needs to be given to the socio cultural and institutional environment in area studies so that their interrelation with economic factors affecting adoption can be inferred the presence of several interrelated innovations is another aspect that needs to be considered more carefully in future research since a number of simultaneous decisions may be involved furthermore the possibility of regular sequential patterns in adopting components of a new technological package should be specifically addressed in future studies finally the impact of differential adoption rates on land holding distribution merits attention in future research

on the past and future of china s township and village owned enterprises abstract this paper proposes an explanation of the historical success of industrial enterprises owned by township and village governments in china i argue that conditions peculiar to china s prereform economy fostered the growth of a skilled workforce and high savings created unusual market niches and encouraged entrepreneurial undertakings by local political elites especially in areas adjacent to certain cities i then discuss the allocative and technical efficiency of local public enterprises in china from a theoretical standpoint and review some relevant econometric findings finally i consider proposals for reform of town and village enterprise tve ownership and discuss the possible advantages of cooperative forms

market expectations of the effects of the tax reform act of 1986 on banking organizations abstract this study investigates market expectations regarding the effect of the tax reform act of 1986 on the banking industry the evidence shows that overall the tax reform did not adversely affect the stocks of banking institutions the findings suggest that overall banking organizations were expected to largely mitigate any negative effects of the tax reform on their cash flow by rebalancing and or repricing their portfolios of assets and liabilities the most significant provision of the new act was the limitation on foreign tax credits interestingly the markets did not expect any adverse valuation effects from the recapture of loan loss reserves or the elimination of the interest deductibility for carrying tax exempt securities

endowments technology and factor markets a natural experiment of induced institutional innovation from china s rural reform the induced institutional innovation hypothesis postulates that new institutions are innovated to exploit profitable opportunities arising from institutional disequilibrium the removal of legal restrictions on factor market exchanges after recent reforms in china resulted in institutional disequilibrium this paper utilizes data from a household survey in china to explore i the relationship between the emergence of land labor and rental markets in a region and the distribution of factor endowments across rural households in that region and ii the impact of hybrid rice on the emergence of factor markets in that region the results are consistent with the induced institutional innovation hypothesis

how much expropriation hazard is too much the effect of land reallocation on organic fertilizer usage in rural china in china land is reallocated on either a full scale or a partial basis by employing a unique farm survey that deliberately draws a distinction between full scale and partial land reallocations and by decomposing their respective expropriation risk effects we find that the significantly negative effect of expropriation risk on organic fertilizer usage is driven solely by full scale reallocation consistent with this finding a reduction in the predicted expropriation hazard rate by half leads to a sizable increase of 491 in organic fertilizer usage in villages with a history of full scale reallocation and has an estimated productivity effect of 19 1

the diversity of land markets and regulations in europe and some of its causes abstractthe creation of optimal land institutions attracted renewed attention in the 1990s because of its central role in the transition process in former communist countries in the former soviet union and eastern europe and more recently because of large scale land investments in developing countries this article documents the existence of large variations in land institutions markets and regulation using current and historical data from western and eastern europe it then offers explanations for these differences and draws implications for the role and optimality of land institutions in development with special reference to the current debate on large scale land acquisitions

productivity consequences of alternative land division methods in china s decollectivization an econometric analysis abstract in this paper we examine the productivity effect of the manner of distributing collective land to households under the chinese economic reforms of the 1980s during that period land was distributed by a formula putting weight on both household size and household labor force and land and labor markets were absent or underdeveloped in most regions a simple model of household decision making is developed for this case and a basic result is that agricultural output is concave in the proportion of land distributed according to workforce as opposed to household size this hypothesis is tested on data for 61 production teams of a township formerly commune in hebei province under a quadratic specification grain output displays the expected concave relationship with the land distribution parameter our results provide some evidence of congruence between equality in the distribution of resources and incentives for productivity

land allocation in hyv adoption models an investigation of alternative explanations microeconomic theory provides four competing explanations for partial land allocation to new and traditional seed varieties in hyv adoption decisions input fixity portfolio selection safety first behavior and learning testing a general model that contains each as a special case suggests that they are jointly most likely to explain land allocation in the hyv adoption decisions of malawian smallholders yet when each explanation is tested to the exclusion of the others as is usually the case in the literature competing hypotheses are individually significant results suggest that employing approaches based on single explanations may lead to inappropriately narrow conclusions

land tenure choice in chinese villages the rational versus the political model the rational and political decision models are developed and tested for the land tenure choice in rural china a novelty of the test is to link the collective decision with general relative factor scarcities competing hypotheses are developed for the two models and tested with panel data collected on 83 chinese villages the results show that neither model is strongly rejected although the political model fares slightly better in more sophisticated econometric testing this suggests that popular political participation is emerging in chinese villages implications of this finding to chinese land policy are discussed

unconventional adjustment strategies for rural households in the less developed areas in greece abstract international competition in agricultural production is intensifying following the implementation of the 1993 accord of the general agreement on tariffs and trade the production of conventional farm products in surplus is being discouraged by means of indirect economic disincentives the common agricultural policy has already adjusted to unprotected national markets within the european union and greater market orientation is being achieved mainly through price reductions farmers in the less developed areas in greece where agricultural activity is still the main source of income and employment have been responding to policy reforms by seeking part time employment and income in non farm enterprises the adoption of alternative unconventional farm enterprises that use farm resources in an innovative and quantitatively different way does have the potential for bringing in a new source of income to farm business for the purpose of this research three adjustment strategies were recognised the conventional no change pathway is based on traditional region specific products production methods and services the adoption of the new crop pathway refers to the redeployment of resources into new agricultural products whereas farms on the market integration pathway redeploy resources into new marketing services and agricultural product processing on the farm the new crop and the market integration pathways are identified as unconventional adjustment strategies results derived from multinomial logit analysis highlight the major constraints and opportunities associated with the adoption of new crops and market integration practices farmers who have adopted unconventional practices are influenced by factors external to the farm such as contacts with institutions and have a high probability of having higher debts these farmers are likely to depend heavily on seasonal labour and rented land the fact that market integration activities are associated with smaller farms in conjunction with off farm work signifies the importance of establishing an integrated rural development policy approach public policy involvement in enhancing dissemination of information concerning unconventional enterprises is emphasised

reputation in bargaining and durable goods monopoly this paper analyzes durable goods monopoly in an infinite horizon discrete time game we prove that as the time interval between successive offers approaches zero all seller payoffs between zero and static monopoly profits are supported by subgame perfect equilibria this reverses a well known conjecture of coase alternatively one can interpret the model as a sequential bargaining game with one sided incomplete information in which an uninformed seller makes all the offers our folk theorem for seller payoffs equally applies to the set of sequential equilibria of this bargaining game

the supply side of co2 with country heterogeneity several recent articles have analyzed climate policy paying explicit attention to the fact that carbon resources are non renewable in most of this body of literature the economy is treated as a single unit and in the context of climate policy it seems reasonable to interpret this as the whole world however carbon taxes and other climate policies differ substantially across countries with such heterogeneity the effects on the emission paths of changes in taxes costs and subsidies might be very different from what is found for a hypothetical world of identical countries

the household responsibility system reform and the adoption of hybrid rice in china abstract this paper studies the diffusion of hybrid rice before and after the recent institutional change from the collective team system to the household based farming system in rural china a simple model which treats the adoption of hybrid rice as a portfolio selection problem is presented the model is tested against time series cross county data collected from hunan province in south china the empirical evidence suggests that 1 adoption behavior in the collective system was not consistent with the predictions of the theoretical model this evidence indicates the existence of administrative intervention in influencing production decisions in the collective system 2 there was a significant change in the structure of the adoption function following the transition from the collective system to the household based system and 3 adoption behavior in the household system is consistent with the predictions of the theoretical model

quasi maximum likelihood estimation of multivariate probit models farm couples labor participation joint estimation of farmers farm and off farm work participation requires a multivariate probit model in which the number of equations is twice the number of household members where there are more than two such equations i suggest a quasi maximum likelihood method which requires only two levels of numerical integration the method maximizes the use of sample information given this numerical feasibility condition it is used for estimating a joint participation model of farm couples farm and off farm work the model yields conclusions about comparative advantages of men and women in farm off farm and housework which cannot be obtained with a more limited setup

household resources transaction costs and adjustment through land tenancy this paper examines the role of household endowments of imperfectly tradeable factors of production e g male female child labor and draft animals on land leasing an explicit attempt is made to account and test for the role of transaction costs on the incidence and extent of adjustment taking place through the land lease market the econometric model is implemented using pooled data from six villages in the semiarid region of india the results confirm the significant role of nontradeable family endowments and indicate the presence of frictions in the land tenancy market

coase and hotelling a meeting of the minds in this paper we tie together the two literatures of durable goods monopoly and exhaustible resource pricing we show that the intertemporal no arbitrage condition that arises if the durable good monopolist seller can commit to a price path mirrors the intertemporal no arbitrage condition if the monopsonist buyer of an exhaustible resource can commit to a price path the intuition is that the durable good monopolist initially announces high future prices to get high valuation buyers to buy early and subsequently lowers the price to attract additional buyers on the other hand the monopsonist buyer of the exhaustible resource initially announces low future prices to encourage sellers to supply their units early and subsequently as the stock of the resource declines raises the price to call forth additional supply as the period of commitment shrinks to zero the durable good s price drops to its marginal cost and the exhaustible resource s price jumps to its choke level all in a twinkling of the eye a

adoption of agricultural innovations as a two stage partial observability process in this paper we reconsider the appropriateness of certain statistical analyses in innovation adoption studies and suggest that partial observability models may sometimes be more useful the proposed models allow for a flexible specification of the process of adoption from one stage to two stages facilitate the modelling of non adopters and remedy the violation of the assumption of full information an application to the adoption of organic cultivation in greece demonstrates the relative merits of the proposed analysis

federal deposit insurance regulatory policy and optimal bank capital this paper seeks to explain the combination of explicit and implicit pricing for deposit insurance employed by the fdic essentially the fdic sells two products insurance and regulation to span the product space it must and does set two prices we argue that the need to establish regulatory disincentives to bank risk taking is the heart of the controversy over the adequacy of bank capital and that the ability to close risky banks before exhausting their charter value i e the value of their right to continue in business stands at the center of these disincentives and in front of the fdic s insurance reserves just as a book shouldn t be judged by its cover a government agency shouldn t be judged by the words behind its initials with the fdic federal deposit insurance corporation the agency s name describes only part of its formal operations the fdic is quasi governmental has a regional structure and sells deposit insurance however the initials fail to convey the fdic s critical place in the governmental regulatory structure as the sole federal overseer of the approximately 8900 state chartered commercial banks that have chosen not to belong the federal reserve system reflecting the federal reserve s membership problem the number of these banks is growing year by year besides selling deposit insurance at bargain explicit rates the fdic performs four regulatory functions 1 entry regulation it passes on new banks applications for deposit insurance and on branch and merger proposals as well thereby protecting the value of existing bank charters 2 examination two thirds of fdic employees are concerned with inspecting bank records and supervising managerial activity 3 regulation of deposit rates and conditions for withdrawal by tradition fdic policies on these matters conform entirely with regulations applicable to federal reserve member banks and 4 disposition of failed banks when an insured bank fails the fdic usually chooses not to liquidate it 2

licensing information goods abstract a significant amount of research on patent licensing and the diffusion of knowledge is organized around static frameworks of analysis patent holders however may face a dynamic problem namely the intertemporal consistency problem of the durable goods monopolist that is induced by durability on the demand side licensing practices such as exclusive licensing contracts and most favored customer clauses allow patentees to solve or mitigate this dynamic consistency problem there are situations however where these practices are not possible either due to the nature of the patent the case of information goods or due to compulsory patenting laws we study the effects of the intertemporal consistency problem on patent licensing in these situations relative to the existing literature we obtain the following main results i all of the firms that remain in the industry will be using the innovation ii royalty licensing may be superior to fixed fee or auction licensing from the licensor s point of view iii social welfare and consumer surplus may be lower than when the patent holder can commit not to make additional sales iv even for non drastic innovations the price of the good that is produced may be lower than the competitive price corresponding to the initial situation before the innovation was discovered

financial intermediation and delegated monitoring this paper develops a theory of financial intermediation based on minimizing the cost of monitoring information which is useful for resolving incentive problems between borrowers and lenders it presents a characterization of the costs of providing incentives for delegated monitoring by a financial intermediary diversification within an intermediary serves to reduce these costs even in a risk neutral economy the paper presents some more general analysis of the effect of diversification on resolving incentive problems in the environment assumed in the model debt contracts with costly bankruptcy are shown to be optimal the analysis has implications for the portfolio structure and capital structure of intermediaries

regional reciprocal interstate banking the supreme court and the resolution of uncertainty abstract in 1985 the supreme court affirmed the ability of the states to enter into regional reciprocal compacts in northeast bancorp inc et al v board of governors of the federal reserve system the current study tests the hypotheses that the court s decision exerted a material influence on the wealth of shareholders in bank holding companies bhcs operating within regional banking compacts and that shareholder reactions were affected by the size of their bhc as a proxy for the likelihood that a bhc would be an acquiror vs a target in the new legislative climate the analysis uses a sample of 52 bhcs that were members of regional interstate banking compacts and a control sample of 107 bhcs based in states that had not passed such enabling legislation as of the event date both portfolios of bhcs exhibited a statistically significant average positive reaction to the supreme court decision further there is evidence that the average bhc in each group reacted significantly differently to that event the reactions of bhcs in regional compacts were associated negatively with their relative size within their respective regional compact but related positively to their absolute size interestingly the reactions of bhcs in the control sample were also negatively associated with their relative size within their home office s state but also positively related to their absolute size all in all shareholders viewed the interstate banking opportunities brought by the supreme court decision to be consistent with their interests

economics for sustainable rural systems abstract critics often reproach the discipline of economics for supporting developments that result in environmental and social degradation this article identifies where such censure is valid but proceeds to argue that the rationale underlying economic techniques is at fault rather than the techniques themselves within the rural context we suggest that economics can make a valuable contribution to the design and achievement of sustainable ways of living valid criticism of economics focuses on its assumptions about value since this has led to emphasis of favourable effects of markets and laissez faire policies exposing rural areas to more rigorously competitive market conditions encourage their transformation by increasing mechanisation industrialisation and a less sustainable use of resources new approaches and policies are required if different outcomes are to be achieved an initial step is to identify desirable outcomes a matter of social choice however society makes multiple demands on rural resources and such issues cannot be adequately captured within a neo classical welfare model an alternative hierarchical framework in the tradition of systems thinking capable of analysing the complex relations associated with rural resource use provides appropriate emphasis to the economic links between goals at different levels within the system and appears to have some heuristic value an empirical counterpart of the hierarchical framework input output analysis generates information to support social choices and can also contribute to the understanding of economic systems and their interaction with the wider social cultural ethical and environmental universe the article concludes with some revised economic policy prescriptions to promote rural sustainability

tenancy and family resources a model and some empirical analysis abstract in this paper we discuss with the help of a simple model the role of family resource endowments in determining the extent of land leased in or leased out by a household this becomes important when the market for some of these resources is either not functioning at all or is functioning imperfectly we focus on three such resources which have some relevance in indian agriculture these are 1 the family s managerial skill 2 its endowment of human labour and 3 its endowment of draft animal labour household level data from six villages of maharashtra and andhra pradesh are also utilized to test some of the hypotheses

bank capital regulation and the valuation effects of latin american debt moratoriums abstract we examine effects of the mexican and bolivian debt moratoriums on bank share prices and analyze whether bank capital regulation influences these returns we hypothesize that investors perceived that capital deficient banks with exposure to this debt would sustain greater regulatory costs due to increased pressure from regulators to strengthen their capital bases or to reduce leverage consistent with this hypothesis we find that the impact of these debt moratoriums on bank stock returns is more unfavorable for capital deficient banks than for banks that met regulatory standards of capital adequacy

institutional reforms and dynamics of agricultural growth in china abstract the collective farming system the state monopolized procurement and marketing system and the grain self sufficient policy formed in the early 1950s made the rapid development of heavy industries possible in china however they were detrimental to farmers incentives and resulted in a serious misallocation of resources consequently despite sharp improvements in technology and increases in the use of modern inputs grain production in china barely kept up with population growth before the 1979 reform the shift from the collective farming system to the household based farming system in 1979 greatly improved farmers incentive and resulted in a sharp increase of grain output in the early 1980s in the late 1980s grain production stagnated again because the incompleteness of procurement system reform made the production of grain unprofitable for producing enough grain to feed china s ever increasing popualation it is imperative for the chinese government to liberalize the grain procurement and marketing system and to invest in yield improvement research it is also desirable for china to adjust her trade policy and to import more grain for meeting domestic grain demands

land inheritance and market transactions in uganda studies on the role of nonmarket land transactions remain limited this paper addresses two questions is land inheritance driven by underdeveloped land markets how does land inheritance influence land disposal and acquisition we use a switching regression model on household data from rural uganda we find that the initially landless or near landless households due to little or no land inheritance obtain land through land markets while those that are land rich dispose of land through land sales and bequests the results suggest that a process of land equalization is unfolding within the sample

the reaction of bank stock prices to the international debt crisis abstract in this paper we develop a cross sectional regression approach to estimate the impact of foreign loan exposure on the pricing of u s bank stocks a new approach is required because news about foreign loan problems may arrive incremently over time rather than reaching the market on a few specific dates the way earnings and dividend announcements do consistent with this interpretation we find that foreign loan exposure had a significant impact on the pricing of u s bank stocks during the years 1982 and 1983 but that the stock prices adjusted continually over the two year period rather than jumping on a few particular days

education and innovation adoption in agriculture evidence from hybrid rice in china this paper uses the diffusion of f1 hybrid rice as a case for examining the effects of education on the adoption of new technology in china a simple behavioral model that treats the adoption of hybrid rice as a portfolio selection problem is presented the implications of the model are tested with farm level data collected from a sample of 500 households in hunan province the results from a dichotomous probit model and a two limit tobit model are consistent with the hypothesis that education has a positive impact on the adoption of new technology

on capturing oil rents with a national excise tax this paper argues that since the supply of oil in the ground is inelastic the incidence of a sales tax on oil maintained forever at a fixed rate would fall entirely on the oil suppliers in the world economy however the elasticity of supply of oil to a single country depends on that country s imports as a share of world output and on the elasticity of demand for that country the paper calculates optimal tax rates for a country as a function of these variables and estimates optimal oil tax rates for the u s for some oecd countries separately and for the u s plus the oecd collectively current u s tax rates are shown to be far below optimal values

rural reforms and agricultural growth in china this paper employs province level panel data to assess the contributions of decollectivization price adjustments and other reforms to china s agricultural growth in the reform period decollectivization is found to improve total factor productivity and to account for about half of the output growth during 1978 84 the adjustment in state procurement prices also contributed positively to output growth its impact came mainly from the responses in input use the effect of other market related reforms on productivity and output growth was very small reasons for slowdown in agricultural growth after 1984 are also analyzed copyright 1992 by american economic association

the international debt crisis and bank security returns in 1982 this research investigates the reaction of bank security returns to the 20 august 1982 mexican request for the rescheduling of its external debt empirical results show that the reaction of bank stocks was rapid and significantly negative within six days of the published announcem ent prices had adjusted to reflect levels of individual bank exposure which re futes the much longer time impliedin other studies of this event the authors c onclude that the marketreaction was essentially efficient rational and orderly copyright 1987 by ohio state university press

toward a theory of induced institutional innovation in this paper we elaborate a theory of institutional innovation in which changes in the demand for institutional innovation are induced by changes in relative resource endowments and by technical change we illustrate from agricultural history how changes in resource endowments and technical change have induced changes in private property rights and in the development of non market institutions we also consider the impact of advances in social science knowledge and of cultural endowments on the supply of institutional change in a final section we present the elements of a model of institutional innovation that maps the relationships among resource endowments cultural endowments technology and institutions

collectivization and china s agricultural crisis in 1959 1961 the agricultural crisis in china in 1959 61 after the initial success of the collectivization movement resulted in 30 million extra deaths in this paper a game theory hypothesis proposes the main cause of this catastrophe i argue that because of the difficulty in supervising agricultural work the success of an agricultural collective depends on a self enforcing contract in which each one promises to discipline oneself a self enforcing contract however can be sustained only in a repeated game in the fall of 1958 the right to withdraw from a collective was deprived the nature of the collectivization was thus changed from a repeated game to a one time game as a result the self enforcing contract could not be sustained and agricultural productivity collapsed the empirical evidence is consistent with this hypothesis

the development of the land lease market in rural china this paper examines the development of the land lease market in rural china special attention is paid to productive heterogeneity among farmers and the openness of the labor market in activating the land lease market a theoretical model is employed to explore the underlying connections an econometric model is implemented using a two period panel data set gathered in three counties of china s zhejiang province the results show that productive heterogeneity and a freer labor market do promote more land leases the implications for the institutional change literature are discussed

global warming prices versus quantities from a strategic point of view abstract this paper investigates how the choices of the instruments affect the interactions in a stock externality game global warming between cartelized fossil fuel suppliers and consumers more precisely the paper studies the equilibria in markov strategies in a dynamic game with each player choosing either the quantity or the price strategy including short run first mover advantages indeed opec and its opponent iea have tried both instruments in the past and play currently in quantities given such a non competitive setting both players should prefer the price instrument therefore both players are expected to switch back to price and tax policies if global warming will be treated effectively

disadvantageous oil tariffs and dynamic consistency a large importer who places relatively greater weight on future than current oil consumption will import less oil in the future than if it were able to commit itself in advance to future tariffs and may find itself worse off than if it were unable to impose tariffs at all futures markets and storage modify these adverse effects and may avoid the problem of dynamic inconsistency copyright 1990 by american economic association

measuring and explaining scale efficiency with the parametric approach the case of greek tobacco growers estimates of technical and scale inefficiencies of tobacco farms in greece during the period 1991 1995 are obtained by using the parametric approach the degree of technical efficiency was found to be lower than the degree of scale efficiency and thus a greater portion of overall inefficiency is due to producing below the production frontier than to producing at an inefficient scale in addition the vast majority of farms in the sample exhibited suboptimal scale implying that output should be expanded to reach the optimal scale empirical results are provided to determine the impact of various socioeconomic demographic and geoclimatic indicators on technical and scale efficiency

impacts of capital and land constraints on the economics of new livestock technology in western kenya abstract the introduction of new forages and milk marketing improvements was projected to permit even the smallest modeled farms in a western kenya region to adopt dual purpose goats and thereby improve family income and nutrition expanded credit permitted modeled medium and large farms especially to vigorously exploit these innovations credit also expanded income more than did goat management improvements because credit extension assistance marketing improvements and new forages will leave projected incomes of small farmers below those of medium and large farmers in the study region development of off farm jobs may still be necessary to supplement the incomes of this fast growing group the marginal value of capital for medium and large farmers with new livestock technology was high this suggests that government subsidized credit might be unnecessary with proper infrastructural and legal support private capital markets might develop as new livestock technology and marketing improvements expand the demand for borrowing

the brazilian default announcement and the contagion effect hypothesis abstract in this paper we use stocl market data to test several hypotheses regarding possible investor reaction to the february 20 1987 brazilian default both the traditional event study approach and a generalized least squares regression using brazilian exposure as an explanatory variable for abnormal returns are used a sample of 46 bank holding companies all listed on the new york or american srock exchanges is divided into groups of no low and high brazilian exposure we find that the initial stock market reaction to the default represents a rational investor response to new bank specific information however the stock market reaction also reveals that not all relevant information was contained in the disclosure announcement further we find some evidence of a contagion effect related to size

farmer to farmer transfer of new crop varieties an empirical analysis on small farms in uganda farmer to farmer transfer or dissemination of technologies is a neglected area of research even though successful diffusion of many researcher and farmer developed technologies is highly dependent upon farmers private initiatives this is particularly true in many developing countries where formal market mechanisms used in dissemination are often ineffective successful dissemination of new technologies to marginal farmers require greater knowledge and use of indigenous dissemination methods the determinants of farmer to farmer transfer of new bean varieties experimented with by small scale farmers in uganda are investigated farmers were experimenting with new varieties received through earlier on farm trials and were transferring small quantities of grain to other farmers for experimental purposes on farm trials may thus be an effective but limited method for diffusing new varieties factors directly associated with the transfer decision were farm size and variables identifying a willingness to experiment with new varieties the production risk reducing strategies of intercropping and sowing of a larger number of non climbing bean varieties were negatively associated with the probability to transfer grain the quantity of grain available to transfer was not associated with the transfer decision farmers were not transferring grain of the five varieties at different rates even though significant differences in yield were found

subsistence first farm allocation decisions in senegal abstract this paper examines a problem suggested by the senegalese experience but common to many countries of joint production of a subsistence crop millet which is subject to stringent marketing constraints and a cash crop groundnuts sold through established channels empirical implications for the intertemporal pattern of land allocation are drawn and evidence is provided to support the proposed approach

unraveling effects of coal output cut policy on air pollution abatement in china using a cge model abstract recently frequent hazy weather in china caused by pm2 5 is mainly attributed to irrational energy consumption structure so the policies cutting coal output and promoting electric power substitution were initiated facing some resistance in the policy implementation what the proper target of cutting coal output is or whether there is a need to cut electricity prices for electric power substitution are still unknown or debatable to exploring this knowledge gap this paper set the eight action plan policy scenarios in which the coal output cut is set from 3 to 10 respectively further in order to observe whether the policy of cutting electric price will reduce the negative effects of action plan policy scenarios the eight enhanced action plan policy scenarios were also set in which the coal output cut is set from 3 to 10 respectively with the hypothetical electric price cut 3 by using the developed computable general equilibrium cge model the policy scenarios are simulated and the economic and environmental effects are tested the results showed that first in most policy scenarios the environmental and economic effects were changing synchronously in inverted u shapes but the policy to cut coal output would lead to positive environmental effects and negative economic effects second cutting electricity price could contribute to promoting electricity substitution though it couldn t be conducive to improving the electricity structure third the reduction of electricity price could also help to reduce the resistance in policy implementation consequently for optimal environmental effects and economic resistance it is recommended to set the policy target of cutting coal output as 6 while the moderate reduction of electricity price is needed and set as 3

the potential of land rental markets in the process of economic development evidence from china abstract we develop a model of land leasing with agents characterized by unobserved heterogeneity in ability and presence of an off farm labor market in this case decentralized land rental may contribute to equity and efficiency goals and may have several advantages over administrative reallocation the extent to which this is true empirically is explored using data from three of china s poorest provinces land rental markets and administrative reallocation reallocate land to those with lower endowments but the former are more effective in doing so and have a bigger productivity enhancing effect information on hypothetical market participation suggests that reducing transaction costs in land rental markets could help to realize significant additional productivity gains

taxing incumbent monopoly to foster entry abstract this paper investigates whether it is welfare enhancing to tax the output of a monopoly in order to foster cost inefficient entry this question is of particular concern in the energy markets dominated by cartel like affiliations opec and oil russia s gas exports to europe and the interest and practice to stimulate the development of alternative fuels making the realistic assumption that none of the players can commit to future policies subsidies are not a viable strategy for the government a tax cannot be first best but can be second best if the government cannot force the incumbent monopoly to sell its output at no profit and if the incumbent s profit is discounted however stimulating supply by improving the conditions for entry is not the prime concern of taxation after all it lowers aggregate supplies and may even lower the entrant s supply but to accrue parts of the monopoly rent

durable goods monopoly with entry of new consumers this paper analyzes a model of a dynamic monopolist who produces at constant unit cost each period a new cohort of consumers enters the market each entering cohort is identical consumers within a cohort have different tastes for the good my main results are if players are sufficiently patient any positive average profit less than the maximum feasible level can be attained in a subgame perfect equilibrium in the subset of subgame perfect equilibria in which players use stationary strategies the seller cannot make sales at prices significantly greater than the lowest willingness to pay when period length goes to zero and the seller attains the maximum profit when commitment is feasible by charging the same static monopoly price in every period this paper analyzes a model of a dynamic monopolist who operates in a market in which there is a regular flow of new consumers the seller produces a durable good at constant unit cost each period a new cohort of consumers enters the market consumers wish to buy exactly one unit of the item but are willing to wait resales are not allowed each entering cohort is identical

durable goods monopoly with discrete demand we analyze a dynamic game between consumers and the sole seller of a durable good unlike previous analyses we assume that there exists a finite collection of buyers rather than a continuum none of the main conclusions of the literature on durable goods monopoly survives this change in assumption coase s conjecture that a durable goods monopolist cannot earn supracompetitive profits in the continuous time limit bulow s proposition that renting a durable is always more profitable than selling it and stokey s proposition that precommitting to a time path of prices is always optimal are all false when the set of buyers is finite thus the assumption of a continuum of consumers so innocuous and useful a simplification in other contexts has proved misleading in the context of durable goods monopoly

rural industry and labor market integration in eastern china abstract this paper tests the competitiveness of the labor market in a semi industrialized county located in eastern china labor market segmentation is linked to the degree of government interventions and the management structures of the local enterprises and two forms of rationing labeled entrance and time rationing are identified a test based on income maximizing behavior is developed to find the form of rationing that is consistent with the data the results show that the labor market is not competitive and time rationing prevails in the county in addition industrial wages are not responsive to experience and education but strongly biased against women and varying to government interventions

an econometric technique for comparing median voter and oligarchy choice models of collective action the case of the nato alliance this paper devises an empirical methodology for discriminating between the median voter model and the oligarchy choice model when applied to the collective provision of a public good in particular an empirical methodology is engineered so that a nested test procedure can evaluate competing models the authors apply this methodology to examine the demand for military activities of ten members of the nato alliance a two stage least squares procedure corrected for autocorrelation is used to estimate the demand equations test results vary some allies abide by the median voter model others by the oligarchy model and still others by neither copyright 1991 by mit press

durable good monopolies with rational expectations and replacement sales a monopoly producer of a durable good is examined under the previously uninvoked assumption that the good depreciates and hence that replacement sales must occur if a fixed stock of the good is to be maintained we find two ways in which the no depreciation result that the monopoly will always at least eventually produce a stock equal to that produced by a competitive market may not hold if the length of the trading period is nonzero the limiting stock produced by the firm will be lower than the competitive stock to ensure the profitability of future replacement sales if the firm is able to constrain its production capacity it may choose a constraint that always binds in the sense that it will be impossible for the firm to achieve a stock equal to the competitive stock

noncooperative collusion in durable goods oligopoly coase conjectured that a durable goods monopolist who can make offers to sell arbitrarily frequently will lose the ability to extract positive profits this result which has now been proved can be attributed to the inability of the monopolist to commit to maintaining sufficiently high prices in the near future for the case of durable goods oligopoly we show that letting the firms make offers arbitrarily frequently enhances their ability to commit to high prices and in the limit enables the firms to enjoy total market profits equal to the full commitment one shot monopoly profit

labor migration and returns to rural education in china this paper provides an answer to the following question why do empirical studies find low returns to schooling in rural china and yet the schooling rates are high i find that schooling played a significant role in raising the accessibility of urban formal employment to rural people in the late 1970s and early 1980s in the face of the government s restrictive policy on labor migration from rural to urban areas the large urban rural income difference provided a strong incentive for senior high school education the theory also explains the drop in the senior high school attendance in the mid 1980s

food insecurity income inequality and the changing comparative advantage in world agriculture i would like to argue in this article that in the process of economic development in land poor countries in asia agriculture faces three distinctly different problems food insecurity sectoral income inequality and the declining food self sufficiency associated with the declining comparative advantage in agriculture at the high income stage massive imports of food grains to asia if they occur will aggravate the world food shortage which will have significant implications for the poverty incidence in the world i argue that in order to avoid such a tragedy asia should expand farm size to reduce labor cost by adopting large scale mechanization sub saharan africa should realize a green revolution in grain production and latin america should further expand its grain production capacity

land rental markets in transition theory and evidence from hungary summary this paper analyzes the determinants of household farms participation in land rental markets in transition countries we derive several hypotheses on the impact of households human capital land endowment land quality and prices transaction costs rural credit and labor market constraints our empirical analysis uses data from a representative survey of more than 1 400 hungarian household farms and hungarian official statistics land rental markets reallocate land to households with better farm management capacities households combine buying and renting of land to extend their farms land ownership is fragmented and land consolidation occurs through renting the domination of corporate farms in some regions restricts households access to land

induced institutional change or transaction costs the economic logic of land reallocations in chinese agriculture abstract the communal land rights system in china which combines individualised farming with periodic land reallocations provides a good case for testing the economic logic of land reallocations analysis of the results of a unique village survey reveals that a village s choice of land reallocation type partial or large in scale is significantly affected by transaction cost considerations which vary according to village topography and size rather than concerns for economic efficiency tenure security the latter of which is a proxy for the theory of induced institutional change more specifically villages with complex topographies tend to favour partial land reallocation whereas larger settlements tend to reallocate land more thoroughly