clean up your own mess an experimental study of moral responsibility and efficiency although market based environmental policy instruments feature prominently in economic theory and are widely employed they often face public resistance we argue that such resistance may be driven by moral responsibility where citizens prefer to tackle the environmental problems that they have caused by themselves rather than delegating the task to others by means of a market mechanism using a laboratory experiment that isolates moral responsibility from alternative explanations we show that moral responsibility induces participants to take inefficient actions that reduce the earnings of the whole group of participants we discuss the implications of this finding for the design and implementation of environmental policies

some evidence on the alchian and allen theorem the third law of demand this paper examines empirically the alchian and allen proposition that shipping charges induce consumers to opt for higher quality goods we show in a household productions framework why this holds whether goods or buyers travel using a large sample of individual consumption data for football games we find that buyers who travel the farthest purchase the best tickets in the end we believe that the alchian and allen theorem is so broad and pervasive that it qualifies as the third law of demand

focusing and framing of risky alternatives abstract this paper develops a theory of focusing and framing in an intertemporal context with risky choices we provide a selection criterion between existing theories of focusing by allowing a decision maker to choose her frame such that her attention is either drawn to salient events associated with an option or to the expected utilities an option yields in different time periods our key assumption is that a decision maker can choose her frame in a self serving manner we predict that the selected frame induces overoptimistic actions in the sense that subjects underrate downside risk but overrate upside risk and accordingly reveal overoptimistic choices hence our theory can explain phenomena such as excessive harmful consumption smoking unhealthy diet and risky investments entrepreneurship lotteries gambling in one coherent framework notably overoptimistic actions are not universal but have plausible limits we characterize under which situations overoptimistic actions are most likely to occur and under which circumstances choices should be rational or even pessimistic

salience in experimental tests of the endowment effect starting with knetsch 1989 experiments on the endowment effect thaler 1980 typically rely on a two stage procedure in the first stage subjects are endowed with a good such as a mug in the second stage the same subjects are given the opportunity to trade this good for another good of similar value such as a pen the endowment effect holds that very few subjects chose to trade sometimes as few as ten percent in related experiments subjects state selling prices for their endowment that are much higher than their buying prices for the same good these patterns are hard to reconcile with standard choice theory which predicts that about half the subjects would trade and that selling prices and buying prices are similar the common explanation of this evidence relies on prospect theory s loss aversion tversky and kahneman 1979 because the pain of parting with the endowment looms larger in the decision maker s mind than the pleasure of acquiring a good of similar value kahneman knetsch and thaler 1990 a decision maker endowed with a mug is unwilling to trade it for a

endogenous property rights regimes common pool resources and trade a model is developed where opening to trade affects a dynamic common pool resource stock and welfare through a community s voting decision to institute a property rights regime regulating the stock the model finds that resource stock levels can decline even when a markov perfect equilibrium path for labor and property rights regimes are chosen to maximize welfare thus opening to trade can be welfare maximizing even when resource stock declines experimental results show that under certain conditions subjects briefly follow a markov perfect equilibrium path for property rights regime choice but labor allocations are myopically chosen indicating that some resource dynamics may be considered by subjects

appropriation and concern for resource scarcity in the commons an experimental study abstract we use an experimental linear design and a logit probabilistic choice function to model and estimate agents concern for resource scarcity although full appropriation is the dominant strategy of the basic game whatever the resource size we expect that if agents exploiting a common pool resource feel any concern for resource scarcity they would be more likely to alter their appropriation strategy the scarcer the resource stock our results show that this expectation holds and appropriation is restrained when resources are scarce further as this result could be attributed to both agents concern for resource scarcity and calculation errors in the determination of the appropriation strategies we estimate the relevance of both

salient compromises in the newsvendor game abstract the newsvendor problem denotes the puzzle that a retailer facing an uncertain demand for some product underreacts to profit margins and hence adjusts the order quantity toward the expected demand due to its range of applications in operations management this problem has drawn much interest in recent years various articles have tried to reconcile the newsvendor problem with loss aversion under ad hoc assumptions on the underlying reference point we instead argue that the newsvendor problem is an application of the well studied compromise effect as the compromise effect is based on violations of the iia axiom we argue that models of context dependent behavior such as salience theory better explain newsvendor like behavior than loss aversion based models we conduct a novel experiment which allows us to clearly distinguish between the role of loss aversion and salience and find strong support for the latter thereby we also add to the agenda of comparing loss aversion based models and salience theory

expectations the commons and optimal group size abstract this article derives a formula for the optimal number of exploiters of a commons whose output is sold in an imperfectly competitive market and whose exploiters hold nonzero or non nash conjectures we express the optimal number of exploiters in terms of the conjecture the elasticity of input productivity and the price elasticity of market demand consistent conjectures those that agree with reality imply the full tragedy of the commons and zero profits for the exploiters

cooperation in a dynamic fishing game a framed field experiment we derive a dynamic theoretical model of renewable resource extraction in the social optimum maximum extraction occurs in the last period only while in the unique subgame perfect nash equilibrium the resource is depleted immediately the predictions are tested in a field experiment conducted at a recreational fishing pond the subjects experienced recreational fishermen face a dynamic social dilemma in which they risk depletion of the resource by overfishing we find strong support for the nash equilibrium fishermen exert as much effort in the last period as in preceding periods and effort is independent of the stock of fish

does relative thinking exist in real world situations a field experiment with bagels and cream cheese i introduction in almost every purchase decision consumers face various alternatives which usually differ in their characteristics and prices even at the same store one could usually find various types of bread soft drinks toothpastes tv sets and so on and when considering alternative stores the number of alternatives is even larger the same applies to services in most places there are many restaurants to choose from and in each restaurant a variety of items on the menu for example because the choice between differentiated goods or services is so common it is very important to understand how consumers make these choices when a consumer faces two differentiated goods and one is preferred to the other but is also more expensive utility maximization implies that he should compare the extra utility from using the better good to the utility he can derive from using the price difference to consume other goods 1 the relative price difference between the goods should not matter only the absolute price difference matters for example suppose that there are two substitute goods the price of the less preferred one is p and the consumer tells us that he is exactly indifferent between the two goods when the preferred good costs p x then if the price of the less preferred good changes to q the consumer should be indifferent between the two goods when the preferred good costs q x 2 the reason is that the difference in utility between the two goods is fixed and so is the utility the consumer can derive by using x dollars toward consumption of other goods to illustrate this idea more vividly suppose that a consumer is indifferent between two flights where one costs 209 and leaves at 7 a m and the other costs 249 and leaves at 10 a m the consumer has to wake up a few hours before the flight in order to catch it and is willing to pay up to 40 to sleep three more hours now suppose that the consumer a month later has to choose again between two flights that are identical except for their departure time and that anything else remains unchanged except that the 7 a m flight s price is 627 the consumer should be indifferent between the two flights if the 10 a m flight costs 667 because he is willing to pay up to 40 for three more hours of sleep product differentiation can come from many sources other than departure time one simple example is the location in which the goods can be purchased if one store is more conveniently located than another and the consumer is indifferent between the two when a certain good costs 20 in one store and 25 in the other then he should also be indifferent between the two stores when buying another good that costs 270 and 275 in the two stores 3 while normatively utility maximization and well defined preferences imply that consumers should exhibit this simple principle several experiments showed that people often deviate from it and exhibit relative thinking thinking about relative price differences in addition to absolute differences azar 2004 4 tversky and kahneman 1981 for example asked people whether they would drive 20 min to save 5 on a calculator when they were going to buy a calculator and a jacket when the calculator s price was 15 and the jacket s price was 125 68 of the subjects were willing to drive but when the calculator s price was 125 and the jacket s price 15 only 29 wanted to drive 20 min to save 5 on the calculator this result was later replicated in several other studies mowen and mowen 1986 showed that the effect holds similarly for student subjects and for business managers frisch 1993 showed that the effect holds also when only a calculator is being purchased ranyard and abdel nabi 1993 varied the price of the second item the jacket and obtained similar results and darke and freedman 1993 found that both the percentage discount and the absolute discount have an effect on consumer choice

an experiment on the pure theory of consumer s behaviour by checking whether consumer demand satisfies the axioms of revealed preference one can test the empirical validity of the neoclassical theory of consumer behaviour however applying the axioms to actual consumer purchase data is difficult if not impossible since it poses serious problems of both a methodological and a practical nature after commenting on the few existing empirical studies in this field we summarise the results from an experimental approach to revealed preference theory data were obtained through a controlled experiment that involved real consumption of the goods chosen we find that most subjects violated the axioms

demand shifts due to salience effects experimental evidence we conduct a laboratory experiment that tests two fundamental predictions unique to salience theory if an agent purchases one of two vertically differentiated products salience theory makes the following two distinct predictions first it hypothesizes that a higher expected price level for both products shifts demand toward the more expensive high quality product second it predicts that demand for the high quality product is larger if the price level is expectedly high than if it is unexpectedly high in our experiment subjects purchased fast or slow internet access at different price levels our results strongly support both predictions of salience theory

environmental versus human induced scarcity in the commons do they trigger the same response we study appropriation strategies in common pool resources where extinction is a credible threat here we present an experimental study of the appropriation of common pool resources in a dynamic setting where resource availability depends on the initial environmental characteristics of the common resource and on human induced resource depletion due to users appropriation patterns our results show that initial resource scarcity limits appropriation by inducing an initial caution among users that persists throughout of the game additionally we find that subjects restrain their appropriation strategies when scarcity increases however this concern for resource scarcity is not enough to prevent resource depletion agents do not counteract the previous rounds appropriation strategies but follow the appropriation trend high appropriation levels are followed by higher appropriation strategies thus promoting the well known tragedy of the commons often concern for resource preservation is not great enough to limit appropriation

salience and consumer choice we present a theory of context dependent choice in which a consumer s attention is drawn to salient attributes of goods such as quality or price an attribute is salient for a good when it stands out among the good s attributes relative to that attribute s average level in the choice set or more broadly the choice context consumers attach disproportionately high weight to salient attributes and their choices are tilted toward goods with higher quality price ratios the model accounts for a variety of disparate evidence including decoy effects and context dependent willingness to pay it also suggests a novel theory of misleading sales

exchange asymmetries for bads experimental evidence abstract this study provides the first incentivized test of exchange asymmetries for unpleasant items the so called bads while prospect theory predicts an endowment effect for goods and bads attention based theories predict an endowment effect for goods but a reverse exchange asymmetry that is a particularly high willingness to switch for bads the investigation of exchange asymmetries for bads is a key element to distinguish between the validity of loss aversion and attention based theories as we find a strong endowment effect for bads our results speak in favor of prospect theory

the commons and the optimal number of firms the problem of the commons is a frequently cited example of market failure in which exploiters pursuit of profits does not lead to the attainment of a social or pareto optimum in particular a free access equilibrium induces an unrestricted number of exploiters or firms to equate the variable input s average product instead of its marginal product to the input s real rental rate hence the rents of the variable input are driven to zero haveman 1973 1 when the number of firms in a commons is unrestricted the scarce factor e g the fishery the hunting ground is not imputed a rent a social optimum can be achieved if a single firm exploits a commons and sells its output in a perfectly competitive market weitzman 1974 the purpose of this note is to derive an expression for the optimal number of firms exploiting a commons when the resulting output is sold in an imperfectly competitive market 2 since demand inelasticity due to monopoly power leads to overconservation while an increase in the number of exploiting firms typically leads to underconservation a finite number of firms for a commons can be found corresponding to a social or pareto optimum in particular the optimum number of firms depends directly on the elasticity of the input productivity and inversely on the price elasticity of market demand

critical factors for transforming creativity into sustainability abstract although creativity and sustainability have received considerable attention in the literature there is limited research considering both particularly in relation to co existing organizational factors which facilitate the transformation of creativity into sustainable products this paper explores this gap through an analysis of six case studies of commercial organizations presenting both successful and unsuccessful implementation of sustainable products services across types of firms and industries the research framework focuses on three general facets 1 leadership 2 boundaries where different aspects of internal and external firm s activities enable a diversity of opinions and stakeholder engagement and 3 economic alignment instrumentality in which the goal of wealth creation is present and supported by a firm s capabilities the main finding of the paper is that appropriate leadership along with effective boundary spanning and clear profit orientation are simultaneously necessary conditions for successful transformation of creative business ideas into successful sustainable products services by business organizations this implies a steep discounting of success prospects if any of the above factors is lacking the work contributes to the development of general theoretical frameworks and approaches for achieving organizational success based on co creating social and economic value at the same time

overcoming barriers to innovation and diffusion of cleaner technologies some features of a sustainable innovation policy regime despite a deepening understanding of systems and processes by which the innovation and diffusion of cleaner technologies occurs relatively little attention has been given to the development of policy processes that reflect this deeper understanding a set of guiding principles for improving sustainable innovation policy processes has been formulated and disseminated by the authors and colleagues in research drawing on theoretical and empirical analysis including a case study of low carbon energy innovation in the uk and interactions with policy makers and other stakeholders through a series of workshops this paper elaborates on two of the guiding principles 1 stimulating the development of a sustainable innovation policy regime bringing together innovation and environmental policy regimes 2 applying systems thinking engaging with the complexity and systemic interactions of innovation systems and policy making processes to promote a transition to sustainability

social welfare in a common property oligopoly output in a markov nash cournot equilibrium to a noncooperative differential game in which in oligopolists extract a common property nonrenewable resource is bounded by the output of in firm and in i firm static oligopolies we discuss the welfare effects of the number of firms and of the divergence between private and social discount rates we compare extraction under the markov and open loop equilibria and then offer an explanation for the possibility that the resource is exhausted instantaneously in a continuous time game this explanation does not depend on the fact that the period of commitment is infinitesimal this essay models the extraction by an oligopolistic industry of a common property nonrenewable resource we characterize the markov perfect equilibrium mpe in a game amongst firms and then provide general conditions under which the resource is exhausted instantaneously if there is unrestricted access to a resource agents perceive its shadow value to be 0 and extract too rapidly when access is restricted to a finite number of agents in none of whom possess exclusive property rights an additional complication may arise if firms behave as oligopolists in the product market they have an incentive to extract the resource too slowly in order to increase the price thus where m firms exploit a resource in the absence of property rights there are conflicting tendencies the absence of property rights encourages excessive exploitation whereas the finite number of firms encourages insufficiently rapid exploitation there are a number of situations where the lack of property rights and the presence of market power coexist examples include i national fisheries which are large enough to affect fish populations and output prices ii common exploitation of aquifers or rivers where individual use affects the price of an agricultural output or of another input iii production by oligopolistic firms which degrades the environment we consider the case of nonrenewable resources such as oil this implies a simple equation of motion for the stock of the resource and emphasizes the role of the number of firms and the stock size such models are often appropriate even if the resource is not literally nonrenewable for example tropical forests or groundwater aquifers are potentially renewable given enough time as indeed oil deposits may be however the rate of replenishment may be insignificant given

common pool equities an arbitrage based non cooperative solution to the common pool resource problem abstract it is proposed that a new type of property right termed a common pool equity can solve the common pool resource problem this equity may be presented to any firm that extracts from the resource for a share in profits it is shown that a profit arbitrage condition ensures that the market and socially efficient solutions correspond whenever market power is absent the cost externalities are fully internalized

decision making in patchy resource environments spatial misperception of bioeconomic models abstract we investigate the performance of subjects in a patchy resource environment in the experimental laboratory to expand the concept of stock misperception into spatial and non spatial components results indicate that substantial heterogeneity exists in the decision heuristics employed that can be used to identify subject types steady state and pulse fishing strategists while steady state strategists are only subject to spatial misperceptions pulse strategists are subject to both forms of misperception both subject groups overallocate effort to regions within the fishery that possess the highest rates of emigration inducing a spatial externality these spatial misperceptions are exacerbated by the spatial structure present

how do markets manage water resources an experiment we experimentally test how a private monopoly a duopoly and a public utility allocate water of differing qualities to households and farmers most of our results are in line with the theoretical predictions overexploitation of the resources is observed independently of the market structure stock depletion for the public utility is the fastest followed by the private duopoly and private monopoly on the positive aspects of centralized public management we find that the average quality to price ratio offered by the public monopoly is substantially higher than that offered by the private monopoly or duopoly

entry deterrence in the commons the authors analyze a common property resource model with a single incumbent firm that faces future potential entry of a rival the cost of harvest from the resource is a function of the stock size by drawing down current stock sufficiently which lowers future stock the incumbent can make entry unprofitable the authors analyze the conditions under which the incumbent firm would deter entry and when entry would be allowed further they analyze the effect that potential entry has on the harvest rate both before and after the date of potential entry and whether or not potential entry is welfare improving copyright 1994 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

a model of focusing in economic choice we present a generally applicable theory of focusing based on the hypothesis that a person focuses more on and hence overweights attributes in which her options dier more our model predicts that the decisionmaker is too prone to choose options with concentrated advantages relative to alternatives but maximizes utility when the advantages and disadvantages of alternatives are equally concentrated in intertemporal choice because the relative concentrations of an option s costs and benets can be dierent from the perspective of a single period and the perspective of the entire choice problem the decisionmaker often exhibits a form of time inconsistency she is present biased when the costs of current misbehavior are distributed over many future dates such as in harmful consumption but future biased when the benet of many

putting on a tight leash and levelling playing field an experiment in strategic obfuscation and consumer protection the paper reports the results of an experiment where asymmetric sellers of a product can obfuscate the market we show that policy measures may have unintended effects of increasing obfuscation incentives we find that policies that limit the effectiveness of obfuscation and policies that promote parity between firms can lead less prominent firms to increase their obfuscation efforts despite this unintended effect however the former type of policies is effective in boosting consumer welfare

salience competition and decoy goods we consider a brand manufacturer who can offer next to its high quality product also a decoy good and faces competition by a competitive fringe that produces low quality we show that the brand manufacturer optimally provides a decoy good to boost the demand for its main product if consumers purchasing decisions are distorted by salient thinking the optimal decoy good is designed such that the superior quality of the brand manufacturer s main product and the unattractive feature of the fringe product are salient

sustainable innovations in the corporate sector the empirical evidence from ibex 35 firms abstract sustainable innovation practices those which simultaneously contribute to environmental social and economic value creation have drawn increased attention from academics industry leaders and policy makers around the globe there is a general agreement that innovation is a very important part of the puzzle in achieving long term sustainability thus a critical question to be answered is what factors actually differentiate and appear to contribute to sustainable innovations si at the firm level this paper addresses the question by examining empirical evidence from the ibex 35 companies from the years 2010 2015 our results obtained from multivariate regression model indicate that the intensity of a firm s si activity is strongly and statistically significantly associated with the sector in which a given firm operates with a rising level of environmental footprint acting as a stimulant for innovation additionally firms characterized by higher net profit margins and returns on equity were also much more likely to introduce sis the findings also suggest that factors like size and age of a given company as well as level of competition in a sector in which it operates are not significant predictors for the implementation of sustainable innovations overall this study contributes to our understanding of the main characteristics of companies active in the area of si

sorting through affirmative action three field experiments in colombia the use of affirmative action policies to promote female employment remains debated do affirmative action policies attract female applicants and does that come at the expense of deterring highly

taxation and product quality new evidence from generic cigarettes in this journal barzel 1976 theorized that per unit taxes should increase the average quality of a product whereas ad valorem taxes may either lower product quality or leave it unaffected there are several different ways to present the logic behind this theory barzel stresses that per unit taxes do not tax all attributes of a commodity causing a substitution from the taxed attributes quantity into the others quality 1 another way is to draw an analogy to the alchian and allen 1964 theorem where the addition of a fixed fee causes a decrease in the relative price of the higher quality version of the product 2 because ad valorem taxes add the same percentage to the prices of both the highand low quality versions of the product they do not distort relative prices thus ad valorem taxes should

cooperation in the commons with unobservable actions we model a dynamic common property resource game with unobservable actions and non linear stock dependent costs we propose a strategy profile that generates a worst perfect equilibrium in the punishment phase thereby supporting cooperation under the widest set of conditions we show under what set of parameter values for the discount rate resource growth rate harvest price and the number of resource users this strategy supports cooperation in the commons as a subgame perfect equilibrium the strategy profile that we propose which involves harsh punishment after a defection followed by forgiveness is consistent with human behavior observed in experiments and common property resource case studies

mitigating the tragedy of the commons through cooperation an experimental evaluation abstract in a commons each firm s costs rise with industry output this externality can be mitigated if firms jointly restrict harvests but higher prices result repeated interaction usually facilitates cooperation that lowers harvest rates increased cooperation suggests there should be more firms in the socially optimal market structure using experimental markets with two to five firms we observe the influence of industry size on harvest rates cooperation increases the socially optimal number of firms in markets when there are static externalities but not for dynamic externalities finally even when the initial stock is low there is little tendency toward resource extinction

contracting problems and regulation the case of the fishery the inefficiencies of common property fisheries are of continuing concern to economists the early work by scott gordon 1954 and anthony scott 1955 outlined the problem and later studies by james crutchfield and giulio pontecorvo 1969 and frederick bell 1972 provided empirical estimates of the losses that result those studies were followed by the dynamic models of colin clark 1976 and james quirk and vernon smith 1970 of optimal harvest rates and the use of corrective taxes or quotas to achieve them but in spite of a large and growing literature and the persuasiveness of the outlined efficiency criteria most fisheries retain common property aspects with overcapitalization and excessive labor input why those conditions persist and the failure of the regulatory response to them are the issues addressed in this paper we examine a number of fisheries but focus on the texas shrimp industry which is one of the nation s most valuable fisheries for a single species and which shares the common property characteristics observed elsewhere it is considered overcapitalized and catch per unit of effort is falling 2 examination of the fishery reveals the many margins along which rent dissipation occurs and the nature of the regulations necessary for controlling fishing effort to avoid those losses the regulatory environment in texas is complicated by conflict within the fishery between inshore and offshore fishermen the latter assert that bay shrimping reduces the number of shrimp that successfully migrate to the gulf the inshore fishery is highlighted by another issue the recent resettlement of some 30 45 000 vietnamese refugees including many fishermen along the texas coast marine advisory service paul starr their entry has been met by hostility and violence from existing shrimpers who recognize that they are in an environment characterized by the absence of property rights bay shrimpers have lobbied the texas legislature for broad limits on new entrants yet ironically the sale of additional boats by individual shrimpers to the vietnamese has facilitated entry of the refugees into the fishery regulations in the texas shrimp and other fisheries are incomplete leaving many options for rent dissipation uncontrolled because of high contracting costs among fishermen and political factors that mold government actions contracting costs are high among heterogeneous fishermen who vary principally with regard to fishing skill 3 montana state university and texas a m university respectively we benefitted from comments by terry anderson raymond c battalio gardner brown oscar burt micha gisser wade griffin john r moroney anthony d scott peter temin and participants in workshops at texas a m university and the university of washington research assistance was provided by scott barnhart and phil mizzi funding was provided by sea grant texas a m university throughout this paper we use the terms common property and open access interchangeably here the terms describe a situation where no property rights group or individual exist s for the resource 2catch per unit of effort in the inshore texas gulf and federal gulf waters is presented for 1963 77 by w l griffin c g tydlacka and w e grant they show catch per unit of effort generally falling in inshore and offshore waters while catch per unit of effort fluctuates from year to year it falls from approximately 360 kg shrimp per unit of effort to 220 kg from 1963 to 1977 the common property nature of the fishery is reflected in the following statistics since 1975 the number of vessels has grown by 23 percent nelson swartz for fish houses the record of entry is similar between 1970 a d 1977 the number of firms grew from 259 to 287 though during that period many left the industry as others entered the number of fish houses was calculated from license data supplied by the texas parks and wildlife department the record of entry by fish houses suggests that monopsony as discussed by colin clark and gordon munro is absent in the fishery 3there may be minor differences in labor leisure choices and capital but our statistical evidence and discussions with fishermen indicate that catch variations are largely due to skill government regulations in the texas bays restrict capital and our empirical evidence shows boats to be relatively homogeneous

the optimal number of firms in the commons a dynamic approach we consider a common property resource sold in imperfectly competitive markets there is a dynamic externality current harvests lower future stocks raising future harvest costs and a static crowding externality increasing industry size raises costs but lowers prices thus it has ambiguous welfare effects the optimal industry size typically changes over time so that a first best outcome cannot be obtained with a fixed number of firms single firm exploitation is optimal only under special circumstances the socially optimal open loop steady state industry size corresponds to the static optimum both generally differ from the closed loop steady state optimum

comparing regulations to protect the commons an experimental investigation in a laboratory experiment we test three regulations imposed on a common pool resource game with heterogeneous users an access fee and subsidy scheme transferable quotas and non transferable quotas we calibrate the game so that all regulations improve users profits compared to free access extraction we compare the regulations according to five criteria resource preservation individual profits profit difference pareto improvement from free access and sorting of the most efficient users one of the main findings is that even though it performs better in sorting out the most efficient subjects the fee and subsidy scheme is not more profitable than tradable quotas

price vs quantity competition in a vertically related market this paper demonstrates that the standard conclusions regarding the comparison of cournot and bertrand competition are reversed in a vertically related market with upstream monopoly and trading via two part tariffs in such a market downstream cournot competition yields higher output lower wholesale prices lower final prices higher consumers surplus and higher total welfare than bertrand competition

spatial externalities and the common pool resource mechanism abstract this paper expands the common pool resource cpr game of walker et al 1990 to incorporate spatial structure with two spatially linked common pool resources subjects participated in a five player common pool resource game under three alternative spatial structures non spatial bi directional and uni directional linkages within the experiment results indicate that behavior in the uni directional cpr game yielded the highest average yields whereas those in the bi directional game were lower than in the non spatial game furthermore investment patterns in the uni directional game were proportionally lower in the sink cpr than those in the source cpr this behavior is consistent with the individual incentives of the game and highlights the importance of understanding the spatial structure present within our natural resources

asymmetric decoy effects on lower quality versus higher quality brands meta analytic and experimental evidence prior research demonstrates that adding decoys to choice sets can increase choice shares of brands similar to decoys while reducing shares of brands dissimilar to decoys such effects have been dubbed attraction effects and violate the principles of independence of irrelevant alternatives ha and regularity we report a meta analysis that in addition to revealing heretofore unsupported range effects demonstrates an effect of brand quality decoys reduce shares of lower quality competitors more than they reduce shares of higher quality competitors moreover whereas iia is violated throughout regularity is violated only when higher quality brands are targeted decoys increase shares of higher quality brands but typically do not increase shares of lower quality brands to assess the generalizability of the meta analytic pattern we tested decoy effects on two distinct populations in a large experiment the more traditional population replicated the meta analytic pattern standard asymmetry while the more nontraditional population reversed it these findings suggest that while the standard asymmetry is replicable it may not generalize to all market segments

training wages and sample selection estimating sharp bounds on treatment effects this paper empirically assesses the wage effects of the job corps program one of the largest federally funded job training programs in the u s even with the aid of a randomized experiment the impact of a training program on wages is difficult to study because of sample selection a pervasive problem in applied microeconometric research wage rates are only observed for those who are employed and employment status itself may be affected by the training program this paper develops an intuitive trimming procedure for bounding average treatment effects in the presence of sample selection in contrast to existing methods the procedure requires neither exclusion restrictions nor a bounded support for the outcome of interest identification results estimators and their asymptotic distribution are presented the bounds suggest that the program raised wages consistent with the notion that the job corps raises earnings by increasing human capital rather than solely through encouraging work the estimator is generally applicable to typical treatment evaluation problems in which there is nonrandom sample selection attrition copyright wiley blackwell