altruistic egoistic and biospheric values in willingness to pay wtp for wildlife abstract we attempt to measure general attitudes and ethical beliefs towards preservation as well as the importance of each of the three considered value orientations biospheric egoistic and altruistic in wtp estimates in the present study we apply the gac scale to a contingent valuation exercise for the recovery of the common murre uria aalge in galicia spain up to now only a few studies in the field of environmental and ecological economics have analyzed value orientations under the environmental concern ec framework obtaining mixed results in the present work we conclude that ethical aspects affect the individuals decision making process and that value orientations play an important role in the pro environmental attitude formation these value orientations affect willingness to pay wtp estimates for environmental goods

dynamic matching and evolving reputations this paper introduces a general model of matching that includes evolving public bayesian reputations and stochastic production despite productive complementarity assortative matching robustly fails for high discount factors unlike in becker 1973 this failure holds around the highest lowest reputation agents for high skill low skill technologies we find that matches of likes eventually dissolve in another life cycle finding young workers are paid less than their marginal product and old workers more also wages rise with tenure but need not reflect marginal products information rents produce non monotone and discontinuous wage profiles

decentralized college admissions we study decentralized college admissions with uncertain student preferences colleges strategically admit students likely to be overlooked by competitors highly ranked students may receive fewer admissions or have a higher chance of receiving no admissions than those ranked below when students attributes are multidimensional colleges avoid head on competition by placing excessive weight on school specific attributes such as essays restricting the number of applications or wait listing alleviates enrollment uncertainty but the outcomes are inefficient and unfair a centralized matching via gale and shapley s deferred acceptance algorithm attains efficiency and fairness but may make some colleges worse off than under decentralized matching

on the sources of aggregate fluctuations in emerging economies recent research on macroeconomic fluctuations in emerging economies has advocated introducing a stochastic productivity trend or allowing for interest rate shocks and financial frictions we estimate a model that encompasses these two approaches shedding light on their relative merits and on how financial frictions affect the transmission of shocks the model accounts for aggregate fluctuations by assigning a dominant role to financial frictions in amplifying conventional temporary productivity shocks whereas trend shocks play a minor role a link between spreads and expected future productivity emerges as essential for a reasonable approximation to the data

are optimal emissions really optimal four critical issues for economists in the greenhouse although the greenhouse effect is by many considered as one of the most serious environmental problems several economic studies of the greenhouse effect most notably nordhaus s dice model suggest that it is optimal to allow the emissions of greenhouse gases ghg to increase by a factor of three over the next century other studies have found that substantial reductions can be justified on economic grounds this paper explores into the reasons for these differences and identifies four partly overlapping crucial issues that have to be dealt with when analysing the economics of the greenhouse effect low probability but catastrophic events cost evaluation methods the choice of discount rate the choice of decision criterion the paper shows that i these aspects are crucial for the policy conclusions drawn from models of the economics of climate change and that ii ethical choices have to be made for each of these issues this fact needs wider recognition since economics is very often perceived as a value neutral tool that can be used to provide policy makers with optimal policies

measuring the existence value of wildlife what do cvm estimates really show two research programs are brought together to contribute to the growing body of work on alternatives to standard welfare based approaches to environmental valuation and policy the first is the theoretical literature undermining the new welfare

price principle and the environment should preferences count as a normative discipline welfare and therefore resource economics postulates that preferences should count in the allocation of resources this postulate cannot be justified in relation to choice or to well being the nor mative qualities that attend choices e g ac countability responsibility commitment and consent explain why choices should count but not preferences which are not actions but theo retical entities constructed ad hoc from stipu lated descriptions of behavior they are then said to explain the satisfaction of preferences moreover has no demonstrable relation with any conception of welfare or well being not sim ply defined in terms of it jel a13

updating human capital decisions evidence from sat score shocks and college applications we estimate whether students update their collegepplication portfolios in response to large unanticipated information shocks generated by the release of sat scores a primary component of admissions decisions exploiting new population data on the timing of college selection and a policy that induces students to choose colleges prior to taking exam we find that the release of scores causes students to update their portfolios in terms of selectivity tuition and sector however the magnitude of updating is too modest to significantly reduce unexplained variation across students suggesting that non academic factors may be the dominant determinants of college choice

willingness to pay attitudes and fundamental values on the cognitive context of public preferences for diversity in agricultural landscapes abstract our study set out to investigate if and how willingness to pay both hypothetical and actual might reflect individuals wider cognitive networks we draw on the idea of cognitive hierarchies i e the notion that concrete preferences and attitudes are embedded in networks of more abstract beliefs and values and explore if willingness to pay wtp as expressed through contingent valuation can be understood as part of such hierarchies to this end we elicited stated and actual wtp in a survey of public preferences and attitudes towards the establishment of an agri environmental payment scheme in northeim germany that rewards farmers for the provision of riparian buffer strips two main findings emerged from the study first only a very small proportion of those stating positive wtp did actually transfer the money second contrary to our hypotheses results from a structural equation model suggest that stated wtp was only poorly connected to attitudes towards the payment scheme and other potentially relevant more abstract beliefs and values this casts doubts on the meaningfulness of such statements of the ten different fundamental value types included only universalism and conformity played a significant role in the cognitive hierarchy and informed generalised environmental beliefs as well as attitudes towards the payment scheme as attitudes seemed to be better integrated in the cognitive network than wtp we discuss if surveys of public preferences should rely on attitude statements rather than solely on monetary values

sharing a ride on the commodities roller coaster common factors in business cycles of emerging economies fluctuations in commodity prices are an important driver of business cycles in small emerging market economies emes this paper documents how these fluctuations correlate strongly with the business cycle in emes a commodity sector is then embedded into a multi country emes business cycle model where exogenous fluctuations in commodity prices follow a common dynamic factor structure and coexist with other driving forces the estimated model assigns to commodity shocks 42 percent of the variance in income of which a considerable part is linked to the common factor a further amplification mechanism is a spillover effect from commodity prices to risk premia

nature roads or hospitals an empirical evaluation of sustainable development preferences while a key proposition is that a sustainable path is one where wealth does not decline whether losses in natural capital can be compensated in wellbeing terms by more produced social or natural capital remains an area of controversy in this paper we seek to better understand preferences for different combinations of assets that comprise part of the asset portfolio of a nation in a study of coastal and marine natural assets we test for the existence of weak or strong sustainability preferences using different compensation options respectively produced capital and natural capital offered to a sample of the public in spain in the case of possible future oil spills as a further element of this test we provide an empirical reflection on aldred 2002 2006 and turner 2007 who speculate that individuals may not view money as compensating for certain environmental losses whereas investments in social assets may offer a more acceptable compensation option our results do appear to circumscribe in some way the acceptability of investing in produced capital and reveal a tendency towards a preference for social capital compensation nevertheless the size of the oil spill and the environmental beliefs of respondents also influence choices over the natural capital compensation option

democratizing access to higher education in russia the consequences of the unified state exam reform this is the first paper that evaluates the effects of a reform requiring russian universities to make admission decisions based on the results of a national high school exam we show the reform led to a threefold increase in geographic mobility rates among high school graduates from small cities and towns to start college this is robust to different techniques samples and specifications the reform was also accompanied by increases in students expectations to attend university parental transfers and educational expenditures there is no evidence the reform affected parental labor supply divorce and employment outcomes of graduates who did not move

public goods self selection and optimal income taxation using the self selection approach to tax analysis this paper derives a modified samuelson rule for the provision of public goods when the government deploys an optimal nonlinear income tax this approach gives a straightforward interpretation of the central result in this area generalises it and provides a simple characterisation of optimal policy in a wide range of circumstances the analysis also emphasises and clarifies the significance of the choice of numeraire for the optimality of decentralising public spending decisions it is well known that the famous samuelson rule for the provision of public goods may not be applicable when the tax revenues used to finance the public goods come from distorting taxes the principle was recognized as long ago as pigou 1947 long before the samuelson rule was devised pigou saw that in addition to the resource cost involved in transferring funds from the private to the public sector there was a deadweight loss involved from this insight he suggested that the criterion for providing public goods should be more stringent than the samuelson rule would later suggest in particular one might expect that the inclusion of the deadweight loss of taxes as part of the cost of providing a public good would lead to a reduction in its optimal provision relative to a situation in which lump sum taxes were available the problem was investigated more systematically by atkinson and stern 1974 who considered the case in which a public good is financed by a set of optimal commodity taxes all individuals were assumed to be identical so efficiency alone dictated the objective they found that no prima facie case could be made for the pigou position that the use of distortionary taxes called for a reduction in the supply of the public good their analysis clearly showed that there were two influences at work when the financing of a public good was by distorting taxes on the one hand

the influence of ethical attitudes on the demand for environmental recreation incorporating lexicographic preferences abstract this article examines the relationships between different ethical attitudes toward environmental quality and the use values obtained from the environment in particular we consider individuals who have duty based ethical attitudes that lead to lexicographic preferences for environmental quality we show that individuals with duty based ethical attitudes have recreation demand functions that are kinked exhibiting perfectly inelastic behavior over some range of income however the kinks cannot be identified from typical cross sectional data and to the extent that observed recreation demand for these individuals differs from those with neoclassical preferences such differences could be captured empirically through a proxy variable that measures ethical attitudes a more fundamental issue is that changes in welfare for duty based individuals cannot be determined from their estimated demand function while an exogenous rise in environmental quality is likely to increase the demand for recreation by these individuals additional recreation is not the reason for an improvement in well being an empirical model to identify the effect of ethical attitudes on recreation is illustrated using survey data on stated preferences for visits to urban parks

limits of floating exchange rates the role of foreign currency debt and import structure abstract a traditional argument in favor of flexible exchange rates is that they insulate output better from real shocks because the exchange rate can adjust and stabilize demand for domestic goods through expenditure switching this argument is weakened in models with high foreign currency debt and low exchange rate pass through to import prices the present study evaluates the empirical relevance of these two factors we analyze the transmission of real external shocks to the domestic economy under fixed and flexible exchange rate regimes for a broad sample of countries in a panel var and let the responses vary with foreign currency debt and import structure we find that flexible exchange rates do not insulate output better from external shocks if the country imports mainly low pass through goods and foreign indebtedness is high

consumer and citizen roles and motives in the valuation of agricultural genetic resources in finland this study analysed consumer and citizen roles in contingent valuation of a conservation programme of agricultural genetic resources and a native breed product the willingness to pay wtp for the conservation programme 48 was mainly driven by perceived taxpayer responsibility and existence and use motives while the wtp for the product price premium of 14 was to a larger extent associated with perceived purchaser responsibility we identified four respondent groups those who emphasized citizens or consumers roles indifferent and negative which differed in terms of their conservation motivations responsibility perceptions and wtp furthermore the results emphasize that citizen and consumer roles overlap and individuals may act as either or both in the context of a purchasing decision and a taxpayers decision of policy support although the conservation programme received more support future conservation could partly be based on the consumption of specialty products

a general equilibrium analysis of state and private colleges and access to higher education in the u s abstract we develop a general equilibrium model of the market for undergraduate higher education that captures the coexistence of public and private colleges the large degree of quality differentiation among them and the tuition and admission policies that emerge from their competition for students a quantitative version of the model matches well estimates of enrollment elasticities variation in need based and merit based institutional aid with respectively student income and ability and aggregate characteristics of u s higher education including college attendance in public and private schools tuition levels and the provision of federal aid predictions about the provision of federal aid and the distribution of students across colleges by ability and income match the empirical counterparts well we use the model to examine the consequences of federal and state aid policies a one third increase in the maximum federal aid increases college attendance by 6 of the initial college population most of the increase being in state colleges and mainly of poor students elite private colleges reduce institutional aid and use the net funding gain to spend more on educational inputs and to substitute some highly able poor students for less able rich students reductions in federal or state aid result in substantially reduced attendance mainly by poor students reductions of support to state colleges induce private colleges to increase enrollments modestly and improve in quality as demand shifts toward them

reaching out access to and use of banking services across countries the authors 1 present new indicators of banking sector penetration across 99 countries based on a survey of bank regulatory authorities 2 show that these indicators predict household and firm use of banking services 3 explore the association between the outreach indicators and measures of financial institutional and infrastructure development across countries and 4 relate these banking outreach indicators to measures of firms financing constraints in particular they find that greater outreach is correlated with standard measures of financial development as well as with economic activity controlling for these factors the authors find that better communication and transport infrastructure and better governance are also associated with greater outreach government ownership of financial institutions translates into lower access while more concentrated banking systems are associated with greater outreach finally firms in countries with higher branch and atm penetration and higher use of loan services report lower financing obstacles thus linking banking sector outreach to the alleviation of firms financing constraints

business cycle implications of rising household credit market participation in emerging countries abstract a small open emerging economy model is extended with a household sector financial constraint to investigate business cycle implications of a rise in household access and use of financial services estimating the model on mexican data and consistent with empirical findings this paper finds that a rise in household credit market participation 1 yields larger aggregate consumption volatility and 2 amplifies the effects of shocks in the domestic economy particularly those transmitted through the interest rate channel the estimated model also highlights that 3 the lesser financial frictions are the lower is the increase of consumption growth and trade balance volatility driven by a rise in household credit market participation and 4 trend productivity shocks become a more relevant source of business cycle fluctuations finally standard measures of predictive accuracy suggest that the extended model outperforms the baseline emerging market model

sorting through search and matching models in economics toward understanding assortative matching this is a self contained introduction to research on search and matching we first explore the nontransferable and perfectly transferable utility matching paradigms and then a unifying imperfectly transferable utility matching model motivated by some unrealistic predictions of frictionless matching we flesh out the foundational economics of search theory we then revisit the original matching paradigms with search frictions we finally allow informational frictions that often arise such as in college student sorting

the value of biodiversity markets society and ecosystems the value of biodiversity is discussed at different levels including market value non market values to humans and the value of biodi versity to ecosystems the main conclusion is that although market exchange values of environmental services may be used to justify biodiversity protec tion measures it must be stressed that exchange value constitutes a small portion of total biodiver sity value the total value of existing biodiversity is largely unknown but indications are that it is essen tial to human existence the various levels of biodi versity value point to the need for a hierarchical and pluralistic methodology to determine appropri ate policies for its preservation jel q21 i introduction among ecologists there is a general con sensus that biodiversity1 is of critical impor tance to the health of ecosystems and even for the long term survival of the human species there is also a consensus that bio diversity is being lost at a rate which is a cause for concern 2 economists on the other hand generally view biodiversity as just an other good which is to be placed in the basket of market choices just as any other the discussion of the specifics of biodiver sity policy has been unsatisfactory partly because of the different meanings of the word value used by economists and ecolo gists many ecologists fail to understand the logic of market allocation and why biologi cal resources are used in seemingly irra tional ways many economists fail to ap preciate the narrowness of the concept of economic value as indicated by relative prices determined by market exchange fol lowing anderson 1966 and brown 1984 the discussion below considers economic measures of value to be species of the genus assigned value which belongs to the family value many biologists and paleontologists be lieve that we are at a critical point in the history of the human species and perhaps even in the 600 million year history of com plex multicelled life on earth if the paleon tologists and biologists who study the phe nomenon of mass extinction are correct the current human induced mass extinction may be of the same order of magnitude as the five other major extinction episodes which destroyed between 20 and 96 percent of existing species on the planet ehrlich and ehrlich 1992 ward 1994 wilson 1992 we are living in a truly remarkable period in earth s 41 billion year history the valua tion decisions our species has made in the recent past and will make during the next few decades will determine the fate of life on earth for the next tens of millions of years it is critical to clarify the language and concepts we use to estimate the value of biodiversity and thus policies leading to its destruction or preservation the importance attached to the issue of biodiversity preservation necessarily in volves ethical judgments about duty to fu ture generations and responsibility toward the nonhuman natural world although in dividuals hold a variety of conflicting beliefs about human responsibility to the natural world this does not mean that policy choices

altruism in cost benefit analysis it has recently been argued that altruistic motives for paying for a public sector project should be ignored in a cost benefit analysis the reason is that including altruism would mean a kind of double counting of the project s benefits this paper takes a look at these arguments and derives cost benefit rules which cover different kinds of altruism the paper also provides some recommendations for the treatment of altruism in studies using the contingent valuation method

matching with noise and the acceptance curse abstract this paper explores matching with both search and information frictions specifically everyone observes only a noisy signal of the true type of any potential mate in this context matching decisions must incorporate not only information about a partner s attribute conveyed by the noisy signal but also as in the winner s curse in auction theory information about a partner s type contained in his or her acceptance decision we show that there exists an equilibrium exhibiting a stochastic positive assorting of types generalizing becker j polit economy 81 1973 813 846 in equilibrium selection is adverse being accepted reduces an agent s estimate of a potential partner s type a phenomenon that we call the acceptance curse effect

the new keynesian transmission mechanism a heterogenous agent perspective we present a tractable heterogeneous agent version of the new keynesian model that allows us to study the interaction between inequality and monetary policy though formulated as a precautionary saving model a la huggett aiyagari its reduced form is a two agent model with a highly concentrated wealth distribution when prices are sticky and wages flexible as in the textbook representative agent model monetary policy affects the distribution of consumption but has no effect on output as workers choose not to change their hours worked in response to wage movements this highlights a transmission mechanism of the textbook model that we find implausible in response to a monetary stimulus the representative worker s labor supply is greatly affected by the profits she receives first the lower profits induced by higher wages raise labor supply through a wealth effect and secondly the mere presence of profits reduces the negative income effect of a wage rise when wages are rigid in contrast our model exhibits plausible responses of output and hours worked to monetary policy shocks

decentralization effects in ecological fiscal transfers a bayesian structural time series analysis for portugal portugal has a unitary system in which the central government transfers funds to lower government levels for their public functions in 2007 portugal introduced ecological fiscal transfers eft where municipalities receive transfers for hosting protected areas pa we study whether introducing eft in portugal incentivized municipalities to designate pa and has led to a decentralization of conservation decisions we employ a bayesian structural time series approach to estimate the effect of introducing eft in comparison to a simulated counterfactual time series quantitative results show a significant increase in the ratio of municipal and national pa designations following portugal s eft introduction which we infer to be a causal consequence the analysis furthermore places emphasis on the importance of relevant municipal conservation competencies for the functioning of the instrument results have important implications for conservation policy making in terms of allocating budgets and competencies in multi level governments

aggregation and deliberation in valuing environmental public goods starting from a distinction between kantian principle based and utilitarian preference based approaches in political theory this essay argues that we may understand normative judgments individuals make about policy to express principled views of the public interest or purpose not private preferences about their own consumption opportunities these judgments in other words state opinions about what we ought to do as a society rather than report preferences about what i want as a utility maximizer this essay then argues that contingent valuation can take into account these kinds of judgments which dominate public discourse about the environment only if it moves toward a deliberative discursive jury like research method emphasizing informed discussion leading toward a consensus based on an argument about the public interest

world shocks world prices and business cycles an empirical investigation abstract svar models that include a single world price such as the terms of trade predict that world shocks explain a small fraction of movements in domestic output typically less than 10 this paper presents an empirical framework in which multiple commodity prices transmit world disturbances estimates on a panel of 138 countries over the period 1960 2015 indicate that world shocks explain on average 33 of output fluctuations in individual economies this figure doubles when the model is estimated on post 2000 data the findings reported here suggest that one world price specifications significantly underestimate the importance of world shocks for domestic business cycles

asset market participation monetary policy rules and the great inflation this paper argues that limited asset market participation is crucial in explaining u s macroeconomic performance and monetary policy before the 1980s and their changes thereafter in an otherwise conventional sticky price model standard aggregate demand logic is inverted at low enough asset market participation interest rate increases become expansionary passive monetary policy ensures equilibrium determinacy and maximizes welfare this suggests that federal reserve policy in the pre volcker era was better than conventional wisdom implies we provide empirical evidence consistent with this hypothesis and study the relative merits of changes in structure and shocks for reproducing the conquest of the great inflation and the great moderation

student portfolios and the college admissions problem we develop a decentralized bayesian model of college admissions with two ranked colleges heterogeneous students and two realistic match frictions students find it costly to apply to college and college evaluations of their applications are uncertain students thus face a portfolio choice problem in their application decision while colleges choose admissions standards that act like market clearing prices enrollment at each college is affected by the standards at the other college through student portfolio reallocation in equilibrium student college sorting may fail weaker students sometimes apply more aggressively and the weaker college might impose higher standards applying our framework we analyse affirmative action showing how it induces minority applicants to construct their application portfolios as if they were majority students of higher caliber

do existence values for cost benefit analysis exist the use of the contingent valuation method to generate estimates of existence value for input to cost benefit analysis requires that individuals have utility functions defined over the relevant arguments the validity of the assumption that the required utility functions generally exist has been questioned it has been argued that some individuals will respond on the basis of lexicographic preference orderings it has also been argued that some individuals do not consider that market or individual willingness to pay criteria are appropriate where existence value type issues are at stake the paper considers survey evidence bearing upon these arguments it is concluded that the evidence is consistent with the view that it is incorrect to proceed on the assumption that individuals generally satisfy the assumptions required for the existence of existence values for use in cost benefit analysis

heterogeneous preferences toward landscape externalities of wind turbines combining choices and attitudes in a hybrid model abstract expanding the share of renewable energy sources might substantially increase externalities as for example wind turbines may disturb the landscape and negatively affect biodiversity this paper investigates the public s sensitivities towards these externalities by using discrete choice experiments and shows how preferences differ across inhabitants of our study region as a further insight into the sources for these variations a hybrid choice model is employed in order to incorporate individuals latent attitudes in the estimated model our latent class structure allocates individuals to classes according to underlying latent attitudes that also influence the answers to attitudinal questions we show that these underlying attitudes are a function of a number of socio demographic characteristics with young people men with low income and those living closer to turbines having a stronger pro wind power generation attitude the inclusion of the attitudes in the class allocation component of the latent class model leads to a richer picture of people s valuations revealing for example antagonistic preferences of two distinct groups of respondents i e advocates and opponents of wind power generation

college assignment as a large contest abstract we develop a model of college assignment as a large contest wherein students with heterogeneous learning costs compete for seats at vertically differentiated colleges through the acquisition of productive human capital we use a continuum model to approximate the outcomes of a game with large but finite sets of colleges and students the continuum approximation lends tractability to a rich model for studying investment incentives in rank order competitions by incorporating two common families of affirmative action mechanisms into our model admissions preferences and quotas we can show that legal admissions preference schemes and illegal quotas have the same sets of equilibria including identical outcomes and investment strategies

the structure of motivation for contingent values a case study of lake water quality improvement abstract critics of the contingent valuation cv method have argued that individuals apply noneconomic motives in responding to cv questions implying that elicited values are not valid measures of the economic benefit of environmental improvement this study examines the role of such motives by using measures of attitude and motive strength to interpret willingness to pay wtp values for a set of nested environmental goods with potential use and nonuse benefits motivational structure is found to be more complex than suggested by the simple distinction between valid economic theoretic and noneconomic motives social motivations possibly associated with the benefit of contributing to a public good rather than the benefits of the good itself are potentially relevant to the wtp decision but do not give rise to separable values the strength of perceived personal responsibility for provision of the good is significantly associated with wtp but also with the theoretically desirable property of enhanced scope sensitivity wtp is not found to be associated with the extent to which the individual feels under some general moral obligation to contribute to good causes motives arising from ethical concerns for the environment and altruism are also potentially relevant to wtp but are closely related to underlying motives associated with existence and personal use values respectively it is suggested that the cv debate should be informed by further empirical investigation of the extent to which motives for wtp can be treated as separable

ecosystems contingent valuation and ethics the case of wetland re creation this paper addresses a current issue in environmental valuation namely the extent to which environmental preferences depart from the usual economic paradigm to incorporate some lexicographic elements after a theoretical discussion the paper reviews attempts to explore this question empirically by supplementing contingent valuation analyses with an exploration of the motives behind willingness to pay responses including zero bids and refusals to answer this is followed by the presentation of new evidence investigating respondents willingness to pay for the creation of a wetland taken from 713 personal interviews of the british public 2000 elsevier science b v all rights reserved

small differences that matter mistakes in applying to college in 1997 the act increased the number of free score reports it provided to students from three to four maintaining a 6 marginal cost for each additional report in response to this 6 cost change act takers sent many more score reports and applications relative to sat takers they widened the range of colleges they sent scores to and low income act takers attended more selective colleges back of the envelope calculations suggest that the policy substantially increased low income students expected earnings this sizable behavioral change in response to such a small cost change suggests that in this setting small policy perturbations can have large effects on welfare

market power and price discrimination in the u s market for higher education the main purpose of this paper is to estimate an equilibrium model of private and public school competition that can generate realistic pricing patterns for private universities in the u s we show that the parameters of the model are identified and can be estimated using a semi parametric estimator given data from the npsas we find substantial price discrimination within colleges we estimate that a 10 000 increase in family income increases tuition at private schools by on average 210 to 510 a one standard deviation increase in ability decreases tuition by approximately 920 to 1 960 depending on the selectivity of the college discounts for minority students range between 110 and 5 750

the effects of financial development in the short and long run theory and evidence from india abstract although many view financial access as a means of reducing poverty or increasing growth empirical studies have produced contradictory results one problem is that most studies cover only a short time frame and do not consider dynamic effects i show that introducing credit in a general model of intertemporal consumption creates a boom in consumption and reduces poverty initially but eventually reduces mean consumption because credit substitutes for precautionary wealth using new consistent consumption data that cover a much longer time period than most studies my empirical findings show that increased access to bank branches in rural india increased consumption initially and reduced poverty but consumption later fell and poverty rose the long term effect is still positive however suggesting that credit may have a beneficial role beyond consumption smoothing

limited asset markets participation monetary policy and inverted aggregate demand logic abstract this paper incorporates limited asset markets participation in dynamic general equilibrium and develops a simple analytical framework for monetary policy analysis aggregate dynamics and stability properties of an otherwise standard business cycle model depend nonlinearly on the degree of asset market participation while moderate participation rates strengthen the role of monetary policy low enough participation causes an inversion of results dictated by conventional wisdom the slope of the is curve changes sign the taylor principle is inverted optimal welfare maximizing discretionary monetary policy requires a passive policy rule and the effects and propagation of shocks are changed however a targeting rule implementing optimal policy under commitment delivers equilibrium determinacy regardless of the degree of asset market participation our results may justify fed s behavior during the great inflation period

adjusting for cultural differences in international benefit transfer values for non market goods can be expected to be sensitive to variations in the cultural contexts of beneficiaries however little progress has been made to date in adapting benefit transfer bt procedures for cultural variations using information from a study that ranked 62 societies with respect to nine attributes of their cultures we develop an index that is then used to re weight multiple coastal ecosystem service value estimates we examine whether these culturally adjusted bt estimates are statistically different than simply transferring the income adjusted mean transfer estimates for each coastal ecosystem service from international study sites to the policy site we find that once differences in income levels have been accounted for the differences in cultural dimensions between study and policy sites actually have little impact on the magnitude of our transfer estimates this is not a surprising result given that the majority of the study site estimates are derived from countries that share many ethnic linguistic and other cultural similarities to the policy site however benefit adjustments based on cultural factors could have a much higher impacts in settings different to that investigated here

pricing and matching with frictions suppose that n buyers each want one unit and m sellers each have one or more units of a good sellers post prices and then buyers choose sellers in symmetric equilibrium similar sellers all post one price and buyers randomize hence more or fewer buyers may arrive than a seller can accommodate we call this frictions we solve for prices and the endogenous matching function for finite n and m and consider the limit as n and m grow the matching function displays decreasing returns but converges to constant returns we argue that the standard matching function in the literature is misspecified and discuss implications for the beveridge curve

the evolution of preferences why sovereign preferences may not lead to sustainable policies and what to do about it abstract the conventional economic paradigm assumes that tastes and preferences are exogenous to the economic system and that the economic problem consists of optimally satisfying those preferences tastes and preferences usually do not change rapidly and in the short term this assumption makes sense sustainability is an inherently long term problem and in the long run it does not make sense to assume tastes and preferences are fixed and given if preferences are expected to change over time and under the influence of education advertising changing cultural assumptions etc the old assumption of consumer sovereignty is not adequate different criteria of optimality are needed how preferences change how they relate to the goal of sustainability and how they can or should be actively influenced to satisfy the new criteria needs to be determined ecological economics has emphasized the three rank ordered goals of ecological sustainability fair distribution and allocative efficiency this paper examines how preferences evolve and change over time and the implications of this for developing policies that meet these three goals in democratic societies

does policy process influence public values for forest water resource protection in florida abstract forest ecosystems play a critical role in protecting water resources yet the neoclassical stated preference assumption is that willingness to pay wtp for forest conservation is solely a function of the ecosystem services provided by these lands thus little attention has been paid to the importance of policy processes as potentially influential drivers of wtp using a statewide web based survey in florida us and a relatively novel valuation approach i e best worst choice we examine public preferences for clean water benefits e g recreation drinking water resources as well as common conservation policy processes such as land acquisition and financial assistance for landowners we found forest water protection programs provide an annual average of 154 230 million in clean water benefits and a significant portion of that value was associated with the policy process attitudes and beliefs about whom forests should be managed for and who should manage forests were also found to influence wtp behaviors we conclude that including policy process information in the valuation survey allows respondents to better determine changes in utility among realistic policy alternatives our findings have important implications for wtp estimation techniques and public participation in environmental policy design

admission tuition and financial aid policies in the market for higher education we present an equilibrium model of the market for higher education our model simultaneously predicts student selection into institutions of higher education financial aid educational expenditures and educational outcomes we show that the model gives rise to a strict hierarchy of colleges that differ by the educational quality provided to the students we also develop a new estimation procedure that exploits the observed variation in prices within colleges identification is based on variation in endowments and technology it does not rely on observed variation in potentially endogenous characteristics of colleges such as peer quality measures and expenditures we estimate the structural parameters using data collected by the national center for education statistics and aggregate data from peterson s and the national science foundation

in state versus out of state students the divergence of interest between public universities and state governments abstract this paper examines the divergence of interest between universities and state governments concerning standards for admitting in state versus out of state students we find that public universities set lower minimum admission standards for in state than out of state applicants presumably in response to state pressure while private universities treat both groups equally however we also find that favoring in state applicants goes against states long term financial interest this is because marginal out of state students pay higher tuition than marginal in state students pay more in future state taxes and are equally influenced in whether they locate in the state after graduation by attending public university there

commodity booms and busts in emerging economies abstract emerging economies particularly those dependent on commodity exports are prone to highly disruptive economic cycles this paper proposes a small open economy model for a net commodity exporter to quantitatively study the triggers of these cycles the economy consists of two sectors one of which produces commodities with prices subject to exogenous international fluctuations these fluctuations affect both the competitiveness of the economy and its borrowing terms as higher commodity prices are associated with lower spreads between the country s borrowing rate and world interest rates both effects jointly result in strongly positive effects of commodity price increases on gdp consumption and investment and a negative effect on the total trade balance furthermore they generate excess volatility of consumption over output and a large volatility of investment besides explicitly incorporating a double role of commodity prices the model structure nests the various candidate sources of shocks proposed in previous work on emerging economy business cycles estimating the model on argentine data we find that the contribution of commodity price shocks to fluctuations in post 1950 output growth is in the order of 38 in addition commodity prices account for around 42 and 61 of the variation in consumption and investment growth respectively we find transitory productivity shocks to be an important driver of output fluctuations exceeding the contribution of shocks to the trend which though smaller is not negligible

the importance of ethics in environmental economics with a focus on existence values the importance of ethics and fundamental value judgments in environmental economics is high lighted by discussing the controversial concept of existence values the social value depends crucially on the social objective which is not necessarily self evident e g since some individuals tend to value nature intrinsically it is shown that the motives behind willingness to pay figures matter for the social value and the conventional view that people respond to cv questions solely in order to maximize their own utility or well being is questioned the importance of being explicit about value judgments is emphasized and it is argued that environmental economics should consider non conventional assumptions which take the social context into account to a larger degree

on the economics of philanthropy friedman says that he accepts this argument as justifying governmental action to alleviate poverty economists will be familiar with this kind of argument someone takes as a premise that a particular activity is the subject of altruistic concern by individuals he shows that if matters are left to unco ordinated private philanthropy a free rider problem will arise and then he claims that this problem can be solved by some kind of intervention by government this strategy has been used to justify many kinds of intervention including compulsory transfers of income through the tax system hochman and rodgers i969 public policy to stimulate saving and investment marglin i963 sen i967 and the subsidisation or public provision of health care arrow i963 lindsay i969 culyer i976 this whole line of argument rests on a particular theory of private philanthropy which in turn relies on three principal assumptions first there is the publicness assumption the charitable activity in question say the relief of poverty or the provision of health care is a common argument in many individuals utility functions and so is a public good in the theoretical sense samuelson i954 in some cases of private philanthropy it is indisputable that the charitable activity is a public good from which donors derive utility consider for example the case of yachtsmen contributing to the royal national lifeboat institution or potential cancer victims contributing to the cancer research campaign in other cases the assumption takes on a rather different character rich britons contribute towards famine relief in cambodia childless old age pensioners contribute towards the care of handicapped children in such cases one would have to be extremely cynical to believe that the charitable activity furthers the self interest of the donor in any significant way but one might suggest that for purely altruistic reasons the donor derives utility from knowing that less fortunate people are being made better off such an effect will be called an altruistic externality friedman along with all of the other writers quoted in the first paragraph of this paper relies on altruistic externalities to justify the publicness assumption the second assumption is that of utility maximisation each individual s decisions concerning his philanthropic