risk sharing and internal migration over the past two decades more than half the population in rural tanzania migrated within the country profoundly changing the nature of traditional institutions such as informal risk sharing mass internal migration has created geographically disperse networks on which the authors collected detailed panel data by quantifying how shocks and consumption co vary across linked households they show how migrants unilaterally insure their extended family members at home this finding contradicts risk sharing models based on reciprocity but is consistent with assistance driven by social norms migrants sacrifice 3 to 7 percent of their very substantial consumption growth to provide this insurance which seems too trivial to have any stifling effect on their growth through migration

extending a lifeline or cutting losses the effects of conflict on household receipts of remittances in pakistan summary i examine the causal effects of long term exposure to conflict measured at the micro level on households receipt of remittances among households residing in areas affected by the 2010 floods in pakistan using a dataset of 7802 households representative of all flood affected areas of pakistan in 2010 i employ iv estimation to overcome the endogeneity of conflict exposure and remittance receipts and control for a range of confounding factors i find that contrary to the literature from country level case studies long term exposure to conflict reduces households likelihood of receiving any remittances at all as well as the average amounts of remittances received however for households in the lowest food consumption expenditure quintile conflict has a positive effect on the likelihood of remittance receipts which provides evidence for the existence of heterogeneous effects as well as a significant micro macro gap in understanding the causal effects of conflict on remittance receipts

efficiency in repeated prisoner s dilemma with private monitoring abstract this paper analyzes repeated games with private monitoring where in each period each player receives a signal of the other player s action in the previous period and that signal is private information previous literature on discounted repeated games with private monitoring has not shown whether or not nearly efficient equilibria exist for a repeated prisoner s dilemma satisfying a certain assumption regarding stage game payoffs we show that there exists a nearly efficient sequential equilibrium provided that imperfectness of signals is small and players are patient journal of economic literature classification number c73

family and community networks in mexico u s migration a household s decision to send migrants is based on infornation it has on the entry costs expected returns and risks of migration information and assistance flow from both family migrant networks and community migrant networks using data from a national survey of rural mexican households we show the importance of networks in both the decision to migrate and the level of migration we find that community and family networks are substitutes in assisting migration suggesting that once migration is well established in a community family networks become less important in addition the development of strong community networks erases the role of household characteristics in migration allowing those initially least favored to also participate in migration finally we show that network density at points of destination in the united states strongly affects where individuals choose to migrate

optimal partnership in a repeated prisoner s dilemma this paper studies informational partnerships in a repeated prisoner s dilemma with random matching assuming that players observe the play within but not across partnerships we find the surprising result that the relation between the observability of actions and the sustainability of cooperation is non monotonic increasing partnerships beyond a certain optimal size hardens cooperation although it improves observability d 2005 elsevier b v all rights reserved

communication in repeated games with private monitoring abstract the paper considers repeated games where each player can be observed by only a subset of the other players and where players can make public announcements about the behavior of the players they observed we address the following question what is the minimal level of observability that is required to obtain efficient outcomes the main result is that the limit set of sequential equilibrium payoffs when the discount factor tends to one contains the set of individual rational payoffs whenever each player is observed by at leasttwoother players journal of economic literatureclassification number c73

labor market performance as a determinant of migration in a comparison of migrants with nonmigrants both observed and unobservable productivity factors are relevant this paper focuses more on the unobservable factors and their correlation between places of origin and destination a human capital model of migration demonstrates that more productive workers at the origin would choose to migrate only if the correlation between origin and destination factors is strongly positive longitudinal data drawn from the cote d ivoire living standards survey 1985 86 are used to examine the pattern of migration in the light of labor market performance both of wage employees and non farm self employed workers it is found that indeed the more productive workers migrate furthermore the general direction of migration is toward cities the conclusion is therefore that rural areas lose their productive workers and that urban areas may gain in productivity from the geographical shifts in population

remittances and household wealth after conflict a case study on urban burundi few studies have researched the use of remittances in conflict affected contexts this study analyzes unique data from burundi testing three hypotheses relative deprivation investment and insurance derived from new economics of labor migration studies employing propensity score matching results show that remittances are common among wealthier households rejecting the relative deprivation hypothesis remittances have strong effects on non productive assets such as living conditions and food security and weak effects on productive assets such as asset ownership poorer households invest mostly in non productive assets suggesting that remittances are insurance for the poor whereas wealthier households seem largely unaffected by remittances

contractual responses to the common pool prorationing of crude oil production this paper examines bargaining among firms to mitigate rent dissipation following the major oil discoveries of 1926 35 because of high bargaining costs firms chose prorationing instead of consolidation and unitization and success varied the analysis also shows that prorationing took the form it did because concession such as per well quotas were required to draw in small operations and the quotas led to predictable responses regarding rent dissipation prorationing despite its costs controlled total field production and costs conserved natural reservoir energies and lengthened field life when private agreements failed the parties successfully appealed for state enforcement since similar heterogeneities influnce regulations elsewhere in the economy detailed analysis of bargaining among firms is essential for insight into the emergence of various institutional forms 33 references 3 tables

remittances and inequality in this paper the authors propose a framework and develop techniques for analyzing the impact of migrant remittances on the distribution of rural income by size and subsequently its impact on rural welfare household data are used to assign numerical coefficients to the impact of net remittances from both internal and international migrants on income inequality in 2 mexican villages the impact of migrant remittances on the distribution of rural income by size depends critically on the degree to which migration opportunities become diffused through the village population on the returns to human capital embodied in remittances and on the distribution of potentially remittance enhancing skills and education across village households our empirical findings demonstrate that in a village where many households contain internal migrants but few have experience migrating to the u s remittances from mexico to us migrants have an unequalizing impact on village incomes while remittances from internal migrants have a favorable effect on the village income distribution by contrast in a village with a long historyh of sending migrants to the us and hence a more ready access to us labor markets us to mexico remittances have an equalizing impact on incomes remittances from internal migrants in this village however embody a large human capital component and are highly correlated with household income hence internal migrant remittances account for a comparatively large share of inequalities in the 2nd village the overall effect of remittances on income inequality is favorable in both villages migration type migration stage and interaction terms all appear to play a role in this context the effects of small changes in remittances upon income inequality and rural welfare in the 2 villages are explored and some implications for migration and rural development policy are considered authors modified

rural urban migration household vulnerability and welfare in vietnam summary this paper investigates the interaction of migration vulnerability to poverty and welfare of rural households in three provinces in central vietnam it addresses three questions 1 to what extent do shocks motivate rural household members to move to urban areas 2 are migrants in the new urban settings better off in terms of working conditions and quality of life and 3 what is the effect of migration on rural household s welfare and vulnerability to poverty the analysis uses panel data of 2200 households from rural vietnam covering the period 2007 2010 and a tracking survey of 299 migrants from 2010 the empirical evidence from a probit model shows that migration especially migration for employment is a livelihood support strategy for households exposed to agricultural and economic shocks migration for education is more likely observed among households with higher human capital and being financially better off nevertheless the probability of migration decreases with the employment opportunity in the village migrants perceive themselves to be better off at the place of destination but income losses from shocks of their rural households may reduce their employment quality the results from difference in difference specifications with propensity score matching techniques suggest that migration has positive income growth effects and that these effects are more pronounced in provinces with fewer job opportunities these effects help not only migrant households moving out of poverty but it also improves the poverty situation in rural areas

international migration and income distribution in the philippines the author uses data on remittances from migrants to determine the effects of migration on household income and its distribution in the philippines i briefly describe the evolution of household income distribution using fies the family income and expenditure survey and the characteristics of households that receive income from migrants and those that do not i discuss the analytical framework that is used and outline the changes in incomes and inequality that emigration causes excerpt

labor market participation of chinese agricultural households empirical evidence from zhejiang province abstract this work is devoted to the analysis of the different labor market participation regimes of chinese farm households over the reform process in the 1980s and 1990s using household data over the period 1986 2002 from the province zhejiang we apply a multinomial logit model to empirically examine household farm and regional characteristics affecting the probability that farmers participate in one of four alternative labor market regimes as generally accepted off farm participation is the dominant form of farm households labor market participation but rural households show additionally a significant impact on rural employment mainly linked with non agricultural household business results suggest that labor market decisions are significantly related to several family farm and village characteristics in particular we find education to be a key determinant of participation furthermore results point to a higher probability of female household members to take up off farm work

capture and ideology in the economic theory of politics the economic theory of regulation long ago put public interest theories of politics to rest these theories have correctly been viewed as normative wishings rather than explanations of real world phenomena they have been replaced by models of political behavior that are consistent with the rest of microeconomics anthony downs 1957 james buchanan and gordon tullock 1965 george stigler 1971 sam peltzman 1976 recently however debate has arisen over whether some version of a public interest theory of regulation will have to be readmitted to our thinking about actions and results in the political arena what is at issue is the empirical importance of the altruistic publicly interested goals of rational actors in determining legislative and regulatory outcomes james kau and paul rubin 1979 kalt 1981 peltzman 1982 this study assesses the nature and significance of publicly interested objectives in a particular instance of economic policymaking u s senate voting on coal strip mining regulations the existence of such objectives is of course no contradiction of the economic view of human behavior kenneth arrow 1972 gary becker 1974 and may well be rooted in genetic biological history becker 1976 jack hirshleifer 1978 generally however individuals altruistic publicly interested goals have been given little attention this reflects the judgment that such goals are so empirically unimportant as to allow the use of occam s razor in positive models or well founded apprehensions that these goals are unusually difficult to identify measure and analyze notwithstanding the latter problem we find that approaches which confine themselves to a view of political actors as narrowly egocentric maximizers explain and predict legislative outcomes poorly the tracking and dissecting of the determinants of voting on coal strip mining policy suggest that the economic theory of politics has been prematurely closed to a broader conception of political behavior

national wage trends and migration in a chinese village economy a micro level modeling approach based on a composite utility function china s economy is experiencing a regime shift away from a fully elastic supply of labor from a large pool of rural surplus labor and toward a situation of increasing labor scarcity and rising wage rates moreover faster wage increases in the regions of origin of many rural urban migrants are likely to affect the dynamics of inter regional migration these wage trends have implications at the local level in particular in a setting in which migration connects rural communities to the national labor market and in which migration is of high importance for the livelihoods of rural households taking a village perspective this article develops a village computable general equilibrium model to study local impacts of current wage trends in china as a central piece of the model the role of access to migration for household livelihoods is recognized access to migration is linked to household demographics and included in the model through a composite utility function that captures household preferences and disutilities associated with alternative off farm activities simulation results illustrate how households utility considerations affect migration responses to national wage changes statements about possible impacts on village level labor supply land use and agricultural production are made when migration wages and local off farm wages are simulated to increase an overall increase in household and village migration and a higher supply of labor to local off farm labor markets is accompanied by a contraction of farm production although land is reallocated between households with different migration responses total agricultural output declines

the folk theorem for repeated games with observation costs abstract the folk theorem literature has been relaxing the assumption on how much players know about each other s past action here we consider a general model where players can buy precise information every period each player decides whether to pay a cost to accurately observe the actions chosen by other players in the previous period when a player does not pay the cost he obtains only imperfect private signals observational decisions are unobservable to others known strategies such as trigger strategies do not work since they fail to motivate players to pay for information this paper shows that the folk theorem holds for any level of observation costs unlike existing folk theorems with private monitoring ours imposes virtually no restriction on the nature of costless imperfect signals the theorem does not use explicit or costless communication thereby having implications on antitrust laws that rely on evidence of explicit communication the main message is that accurate observation alone however costly enables efficient cooperation in general repeated games

existence of nontrivial equilibria in repeated games with imperfect private monitoring abstract we consider finitely repeated games with imperfect private monitoring and provide several sufficient conditions for such a game to have an equilibrium whose outcome is different from repetition of nash equilibria of the stage game surprisingly the conditions are consistent with uniqueness of the stage game equilibrium a class of repeated chicken is shown to satisfy the condition

dissipation of contestable rents by small numbers of contenders the theory of rent seeking with its origins in the observations of gordon tullock 1967 or to use jagdish bhagwati s 1982 proposed term the theory of directly unproductive profit seeking activities is concerned with the potentially adverse effects on resource allocation of incentives to cap ture and defend artificially contrived rents and transfers the scope for so cial loss proposed by the theory derives from the relation between the value of a contestable prize and the value of the resources attracted into the con test to determine the beneficiary of the prize underlying this social loss is a specification of how rational behavior by optimizing agents links the value of the prize sought to the resources expended it has been traditional to assume competitive behavior in describing the activities of lobbying and influence seeking then if some further condi tions are satisfied l the total value of the resources expended precisely equals the value of the prize sought so dissipation is complete 2 conse quently the social cost associated with contestability of a rent can be in ferred from the value of the rent itself and the detailed and hard to come by information on individual outlays made in the course of the contest be comes unnecessary by basing their analyses on competitive dissipation contributors to the rent seeking literature see the review by robert tollison 1982 have been able to presume that the observed value of a contested rent is an exact measure of the associated social cost of monopoly power or regu lation similarly in the trade theoretic literature where the rights contested are to quota premia or revenues from trade taxes krueger 1974 bhagwati

long term partnership in a repeated prisoner s dilemma with random matching abstract we consider a repeated prisoner s dilemma with random matching according to the unanimity principle players can continue their long term partnership the folk theorem holds on the assumption that strategies are time and history independent

efficiency results in n player games with imperfect private monitoring abstract we demonstrate that efficiency is achievable in a certain class of n player repeated games with private almost perfect monitoring our equilibrium requires only one period memory and can be implemented by two state automata furthermore we show that this efficiency result holds with any degree of accuracy of monitoring if private signals are hemiindependent whereas most existing research focuses on two player cases or only a special example of n player games our results are applicable to a wide range of n player games of economic relevance such as trading goods games and price setting oligopolies

collusion with almost no information we analyze noncooperative collusion in an infinitely repeated bertrand game where each of the n firms receives a privately observed i i d cost shock in each period and firms only and privately observe whether they have won the unit mass of consumers no other information is available and no communication is allowed we prove that there exist equilibria in private strategies approximating first best profits when firms are sufficiently patient in particular productive efficiency obtains in the limit

beliefs and private monitoring this paper develops new recursive set based methods for studying repeated games with private monitoring for any nite state strategy prole we nd necessary and sucient conditions for whether there exists a distribution over initial states such that the strategy together with this distribution form a correlated sequential equilibrium also for any given correlation device for determining initial states including degenerate cases where players initial states are common knowledge we provide necessary and sucient conditions for the correlation device and strategy to be a correlated sequential equilibrium or in the case of a degenerate correlation device for the strategy to be a sequential equilibrium we also consider several applications in these we show that the methods are computationally feasible show how to construct and verify equilibria in a secret price setting game

rent seeking in natural resource quota allocations this paper examines the incentives for rent seeking in the allocation of natural resource quotas to competing user groups by political bodies the political body has discretion in making the allocation and competing user groups rent seek to influence the allocation we investigate ways in which the governmental body can affect the behavior of the players by setting the ground rules for the competition a political body can affect an allocatively pareto efficient outcome by choosing an appropriate default pre rent seeking policy surprisingly an allocatively efficient default policy is unlikely to minimize social costs however winner take all default policies are likely to maximize not minimize rent seeking a competitive post allocation market reduces rent seeking but is not either itself or in combination with an efficient default policy capable of minimizing social costs however forcing winners in political redistributions to fully compensate losers both lowers the rent seeking levels relative to a potential compensation criterion and when used together with an efficient default policy is capable of obtaining the first best solution of an allocatively efficient allocation with zero rent seeking

social norms and random matching games abstract nash equilibrium has been tremendously useful in understanding economic problems in which strategic behavior is important the theoretical foundations of the solution concept often include the assumption that the game to be played is common knowledge an unrealistic assumption in games with many players we introduce the concept of norm equilibrium for random matching games a norm equilibrium is a nash equilibrium that relies on substantially less information than common knowledge of the game we use norm equilibria to provide a folk theorem for random matching games and to analyze increasing numbers of players in a random matching game journal of economic literature classification numbers c70 c72

does migration raise agricultural investment an empirical analysis for rural mexico the effect of remittances on capital accumulation remains a contested topic this paper uses a panel data set from rural mexico to investigate the impact of remittances on agriculture and livestock investments after controlling for the endogeneity of migration through an instrumental variable estimation our empirical results show that international migration has a significantly positive effect on the accumulated agricultural assets but not on livestock capital this suggests that households use the capital obtained from international migration only to overcome liquidity constraints for subsistence production whereas migration itself seems to be the superior investment option compared to other productive activities such as livestock husbandry

asymmetry of customer loss and recovery under endogenous partnerships theory and evidence this article is inspired by real world phenomena that firms lose customers based on imprecise information and take a long time to recover if consumers are playing an ordinary repeated game with fixed partners there is no clear reason why recovery happens slowly however if consumers are playing an endogenously repeated game a class of simple efficient equilibria exhibits the asymmetry of fast loss and slow recovery of customers after a bad signal exit is systematic but formation of a new partnership is random we also give empirical evidence of our equilibria at an individual firm level

a foundation for markov equilibria in sequential games with finite social memory we study stochastic games with an infinite horizon and sequential moves played by an arbitrary number of players we assume that social memory is finite every player except possibly one is finitely lived and cannot observe events that are sufficiently far back in the past this class of games includes games between a long run player and a sequence of short run players and games with overlapping generations of players an equilibrium is purifiable if some close by behaviour is consistent with equilibrium when agents payoffs in each period are perturbed additively and independently we show that only markov equilibria are purifiable when social memory is finite thus if a game has at most one long run player all purifiable equilibria are markov

a belief based approach to the repeated prisoners dilemma with asymmetric private monitoring abstract this paper extends the belief based approach to the repeated prisoners dilemma with asymmetric private monitoring we first find that the previous belief based techniques t sekiguchi efficiency in repeated prisoners dilemma with private monitoring j econ theory 76 1997 345 361 v bhaskar i obara belief based equilibria in the repeated prisoners dilemma with private monitoring j econ theory 102 2002 40 69 cannot succeed when players private monitoring technologies are sufficiently different we then modify the previous belief based approach by letting the player with smaller observation errors always randomize between cooperate and defect along the cooperative path of the play we show that with vanishing observation errors efficiency and a folk theorem can be approximated using our modified belief based strategies

individual learning and cooperation in noisy repeated games we investigate whether two players in a long run relationship can maintain cooperation when the details of the underlying game are unknown specifically we consider a new class of repeated games with private monitoring where an unobservable state of the world influences the payoff functions and or the monitoring structure each player privately learns the state over time but cannot observe what the opponent learned we show that there are robust equilibria in which players eventually obtain payoffs as if the true state were common knowledge and players played a belief free equilibrium we also provide explicit equilibrium constructions in various economic examples copyright 2014 oxford university press

nash equilibrium and the history of economic theory john nash s formulation of noncooperative game theory was one of the great breakthroughs in the history of social science nash s work in this area is reviewed in its historical context to better understand how the fundamental ideas of noncooperative game theory were developed and how they changed the course of economic theory

economic effects of migration on the left behind in cambodia abstractusing propensity score matching this study examines the effects of migration on various indicators of household wellbeing in cambodia the results indicate that migration would reduce poverty headcount rate by 3 7 percentage points and decrease the depth of poverty migration is also found to reduce by 5 10 per cent the hours worked by members left behind the impact of migration on labour participation may be however vulnerable to unobservable factors nevertheless the study suggests that important heterogeneous effects which differ from the average impact exist the analysis is conducted separately by internal and international migration

collective rent dissipation the theory of rent seeking was initiated by tullock 1967 1980 followed by krueger 1974 and posner 1975 and more recently extended in various directions by allard 1988 appelbaum and katz 1986a b c gradstein and nitzan 1989 hillman and katz 1984 1987 hillman and samet 1987 hillman and riley 1989 katz et al 1990 long and vousden 1987 ursprung 1990 and varian 1989 the purpose of this paper is to extend this theory by introducing the possibility of collective group rent seeking with voluntary individual decisions regarding their extent of participation in the collective rent seeking efforts

the folk theorem with imperfect public information the authors study repeated games in which players observe a public outcome that imperfectly signals the actions played they provide conditions guaranteeing that any feasible individually rational payoff vector of the stage game can arise as a perfect equilibrium of the repeated game with sufficiently little discounting the central condition requires that there exist action profiles with the property that for any two players no two deviations one by either player give rise to the same probability distribution over public outcomes the results apply to principal agent partnership oligopoly and mechanism design models and to one shot games with transferable utilities copyright 1994 by the econometric society

causes of u s farm commodity programs this paper i s an attempt to explain variations by commodity in producer protection afforded by farm price support programs since the1930s particularly emphasized are theideas that these programs are essentially income redistributional measures and that given political forces the programs are attempts to redistribute efficiently variables associated with the cost to producers of generating political pressure and the social cost deadweight losses of redistribution are both found to be empirically important copyright 1987 by university of chicago press

dynamic rent seeking abstract a dynamic model of the political process is presented under conditions of uncertainty as in an earlier model by becker several interest groups vie for political influence exerted in the form of taxes and subsidies some results of the static single interest group theory of rent seeking are given slightly modified interpretations among other things it is shown that a group s rent seeking activity is negatively related to the rate of growth of national income to the group s relative position in the income distribution and to measures of how deserving it is the importance of voting is modelled explicitly it is also found that policies tend to be adopted which minimize the deadweight welfare losses from rent seeking

robustness of public equilibria in repeated games with private monitoring a repeated game with private monitoring is close to a repeated game with public monitoring or perfect monitoring when i the expected payoff structures are close and ii the informational structures are close in the sense that private signals in the private monitoring game can be aggregated by some public coordination device to generate a public signal whose distribution is close to the distribution of the public signal in the public monitoring game we provide a sufficient condition for the set of uniformly strict perfect public equilibria for a public monitoring game to be robust in nearby private monitoring games in the sense that they remain equilibria with respect to the public signal that is generated by such public coordination devices with truthful reporting our sufficient condition requires that every player is informationally small in a well defined sense

cooperation in community interaction without information flows we study cooperative behaviour in communities where the flow of information regarding past conduct is limited or missing players are initially randomly matched with no knowledge of each other s past actions they endogenously decide whether or not to continue the repeated relationship there is incomplete information regarding player types a subset of the population is myopic while the remainder have discount factors that permit cooperation in principle we define social equilibrium in such communities such equilibria are characterized by an initial testing phase followed by cooperation if the test is successful it is precisely the presence of myopic types that permit cooperation by raising barriers to entry into new relationships we examine the implications of increased patience which takes two forms an increase in the number of non myopic types and an increase in the discount factor of non myopic types these two notions turn out to have strikingly different implications for the degree of cooperation that can be sustained

economic impacts of the california one variety cotton law the california one variety cotton law is an important example of technological regulation in this case intended to serve as a de facto quality control and to mitigate externalities in production that can arise from the mixing of cottonseed at the gin this paper describes and interprets the economic history of the law presents a theoretical model of its economic effects and provides quantitative estimates of the impacts on output prices and economic welfare following a partial deregulation under a 1978 amendment to the law the analysis shows that large social costs have arisen from concentrating control over the genetic base for california cotton production in the hands of a single government cotton breeder and restricting production to the use of a single selection of a single variety some of these costs have been eliminated by the partial deregulation in 1978 to permit private breeders to compete in the provision of genetic material but production is still restricted to the acala variety of cot

a generalized model of rent seeking behavior in this paper i present a formal analysis of rent seeking games in which the players valuations for the prize are represented as vectors the players in this game are risk neutral and may not be indifferent to who wins the contestable rent if it is someone else both tullock s original rent seeking model and the public goods rent seeking model by katz et al turn out to be special cases of this more general model

communication in repeated games with imperfect private monitoring this paper examines repeated games in which each player observes a private and imperfect signal on the actions played and in which players are allowed to communicate using public messages providing incentives for players to reveal their observations generates revelation constraints that combined with signal imperfections may be a source of inefficiencies however by delaying the revelation of their observations players may economize on the cost of deterring deviations and thereby avoid these inefficiencies because a player would not want to trigger a sanction that would penalize him too revelation constraints also tend to make sanctions difficult to enforce however with at least three players detecting deviations may not require that all the players reveal their observations in that case we obtain a nash threat version of the folk theorem with two players we do not obtain a similar result nevertheless we show that an efficient outcome can almost always be approximated

short term labour migration from the republic of armenia to the russian federation we explore the determinants of short term labour migration from armenia to russia based on a unique panel dataset a dynamic switching regression model with endogenous switching is applied our evidence pinpoints migration experience the expected individual income gap from migration low job opportunities in armenia and the possibility of diversifying income risks as the most important determinants family ties turn out to be insignificant the hypothetical income gap is about 280 per cent several explanations are provided for the fact that some individuals do not migrate in spite of a large income gap

environmental stressors and migration evidence from vietnam the argument that environmental change is an important driving force of migration has experienced a strong revival in the climate change context while various studies predict large environmental migration flows due to climate change and other environmental events the ex post empirical evidence for this phenomenon is inconclusive we contribute to the extant literature by focusing on the micro level we examine whether and how individual perceptions of different types of environmental stressors induce internal migration the analysis relies on original survey data from vietnam including both migrants and non migrants the results suggest that individual perceptions of long term environmental events such as droughts significantly reduce migration while perceptions of sudden onset environmental events such as floods significantly increase the likelihood of migration controlling for other determinants of migration these findings also imply that improving the targeting of aid to environmental disaster affected areas and the financial and technical support for adaptation to environmental change could be the most productive policy options policymakers thus need to implement a wide range of developmental policies in combination with environmental ones in order to improve society s ability to effectively cope with environmental change and minimize its effect on migration

a robust folk theorem for the prisoner s dilemma we prove the folk theorem for the prisoner s dilemma using strategies that are robust to private monitoring from this follows a limit folk theorem when players are patient and monitoring is sufficiently accurate but private and possibly independent any feasible individually rational payoff can be obtained in sequential equilibrium the strategies used can be implemented by finite randomizing automata journal of economic literature classification numbers c72 c73 d82

risk aversion time preferences and out migration experimental evidence from ghana and indonesia abstract it has long been hypothesized that migrants and non migrants differ in their individual risk and time preferences due to a lack of reliable data on migrants preferences empirical evidence however is scarce therefore this paper has sought to advance research on preferences and migration decisions by using original household survey data from two developing countries that are both characterized by a longstanding tradition in regional migration in coastal communities in ghana and indonesia individual risk and time preferences have not only been elicited through survey questions but also through experimental tasks with real and relatively large monetary payoffs there is evidence that out migrants from both study regions are significantly less risk averse and have a lower time preference than non migrants overall the results indicate that the considered individual preferences are as important as employment status education or networks which have mainly been the focus of migration theories

on perfect rent dissipation if economists are united on anything it is the proposition that monopoly prices reduce economic welfare by preventing the realization of the maximum gains from trade in any market the extent of such distortions to efficiency are often called harberger costs after arnold harberger s 1954 provocative attempt to measure the extent of these losses in the u s economy more recent analysis has revealed that when monopoly power is achieved via regulation at least part of the monopoly rents so gained will not be simple transfers from consumers to producers but will be dissipated by producers rent seeking activity since such activity employs real resources there are additional costs to monopolization beyond the harberger costs as emphasized by gordon tullock 1967 and richard posner 1975 indeed posner and others have argued that if competition for the monopoly rents is perfect all of the expected rents from regulation will be converted to welfare losses while franklin fisher s 1985 comment has qualified this conclusion somewhat the upshot of the debate is that the rent seeking or tullock costs may greatly exceed the harberger costs 1 another recent strand of the analysis concerns the time pattern over which monopoly returns are dissipated by competition to gain and hold the monopoly right robert mccormick et al 1984 emphasize that to the extent such expenditures are sunk they are forever lost and not recoverable by deregulation while conceding the point martin cherkes et al 1986 argue that most rentseeking expenditures are recurring not sunk and therefore large gains from deregulation remain the purpose of this essay is to point out that recurring or sunk even the largest specification of the harberger and tullock costs of regulatory monopolization may fall far short of the actual welfare costs this is because the analysis concentrates on the rent seeking tullock costs and largely ignores the parallel rent defending2 tullock costs a proper assessment of such rent defending tullock costs might more than double the maximum welfare costs of regulation suggested by posner

migration risk and liquidity constraints in el salvador abstract this article utilizes panel data from el salvador to investigate the use of transnational migration as an ex post risk management strategy i show that adverse agricultural conditions in el salvador increase both migration to the united states and remittances sent back to el salvador i show that in the absence of any agricultural shocks the probability that a household sent members to the united states would have decreased on average by 24 26 i also show that the 2001 earthquakes reduced net migration to the united states a one standard deviation increase in earthquake damage reduced the average probability of northward migration by 37 11 the evidence suggests that the effects of the earthquakes had more to do with households retaining labor at home to cope with the effects of the disaster than with the earthquakes disrupting migration financing

a limit characterization of belief free equilibrium payoffs in repeated games abstract the present paper studies repeated games with private monitoring and characterizes the set of belief free equilibrium payoffs in the limit as the discount factor approaches one and the noise on private information vanishes contrary to the conjecture by ely et al j c ely j horner w olszewski belief free equilibria in repeated games econometrica 73 2005 377 415 the equilibrium payoff set is computed by the same formula no matter how many players there are as an application of this result a version of the folk theorem is established for n player prisoner s dilemma games

perfect communication equilibria in repeated games with imperfect monitoring this paper introduces an equilibrium concept called perfect communication equilibrium for repeated games with imperfect private monitoring this concept is a refinement of myerson s myerson r b 1982 optimal coordination mechanisms in generalized principal agent problems j math econ 10 67 81 communication equilibrium a communication equilibrium is perfect if it induces a communication equilibrium of the continuation game after every history of messages of the mediator we provide a characterization of the set of corresponding equilibrium payoffs and derive a folk theorem for discounted repeated games with imperfect private monitoring

are rents fully dissipated students of rent seeking have erred in focusing their attention exclusively on the analysis of competitions for exogenously specified transfers when redistributive policies are treated as endogenous choices it is clear that there are both incentives and opportunities for policymakers to design them in ways that prevent the wasteful dissipation of a large proportion of the intended transfers an analytical framework that treats policy design in this way is capable of explaining a variety of common attributes of redistributive policies that are apparent anomalies under the traditional approach to rent seeking furthermore we predict and find supporting evidence that authoritarian regimes tend to be associated with higher ratios of government revenue to total income than do democracies we attribute this tendency to the substantially greater potential for dissipative competition for revenues under democracy than under dictatorship finally available estimates of lobbying expenditures and rents transferred under the recent federal crude oil controls contradict the hypothesis that rents are fully or almost fully disspated through political competition

community enforcement of trust with bounded memory we examine how trust is sustained in large societies with random matching when records of past transgressions are retained for a finite length of time to incentivize trustworthiness defaulters should be punished by temporary exclusion however it is profitable to trust defaulters who are on the verge of rehabilitation with perfect bounded information defaulter exclusion unravels and trust cannot be sustained in any purifiable equilibrium a coarse information structure that pools recent defaulters with those nearing rehabilitation endogenously generates adverse selection sustaining punishments equilibria where defaulters are trusted with positive probability improve efficiency by raising the proportion of likely re offenders in the pool of defaulters

the new economics of labor migration this paper reviews selected theoretical and empirical developments in the field of labor migration economics the migration behavior of individuals differs in accordance with their perceived relative deprivation those who are relatively more deprived tend to have stronger incentive to migrate than those who are relatively less deprived moreover a reference group characterized by more income inequality is likely to generate more relative deprivation highly skilled workers are also more likely to migrate migration decisions are often made jointly by the migrant and nonmigrant with a contractual arrangement regarding the sharing of costs and returns the exchange of commitments to share income provides coinsurance of particular interest are the determinants of the speed of adoption of migration as an innovation and the characteristics associated with the delay in the adoption of innovation new econometric techniques including techniques for the analysis of qualitative dependent variables techniques that correct for sample selection bias and those for the analysis of longitudinal data have substantially benefited empirical research in this area new methods that can correct for the biased estimate of the wages particular individuals would receive at 2 or more locations at the same point in time allow researchers to test locational decsion making models estimates of these structural models of labor migration support the hypothesis that individuals respond to income incentives in making the decsion to migrate further research is needed on the pazzling observation that migrant workers earn less than native born workers with similar characteristics during the 1st few years after migration but more thereafter other topics that need further research include the macroeconomic effects of migration the microeconomic and macroeconomic relationships between aging and labor migration and the migration behavior of dual earner families

efficient redistribution through commodity markets efficiency in redistribution is measured in terms of deadweight loss generated per dollar of economic surplus transferred between consumers and producers of a commodity by means of market intervention the implications of supply and demand elasticities for efficiency in redistribution are examined with special attention to the comparison of production control and deficiency payment programs the results may be used to aid in the evaluation of commodity programs and as a basis for consideration of the hypothesis that observed policies are efficient given the political power of interest groups

the impact of international remittances on child outcomes and household expenditures in nepal abstractnepal has one of the highest ratios of international remittances to gross domestic product in the world we examine whether the massive inflow of international remittances affects child schooling child labour and household expenses controlling extensively for a host of observed characteristics of households and migrants and using an instrumental variable approach this research finds no effect of international remittances on child education or child labour in nepal however it does find a significant increase in non food expenditures including education spending due to international remittances despite increased expenditure on child education educational outcomes are not improving because of international remittances

optimal cartel equilibria with imperfect monitoring abstract there exist optimal symmetric equilibria in the green porter model 4 8 having an elementary intertemporal structure such an equilibrium is described entirely by two subsets of price space and two quantities the only production levels used by firms in any contingency the central technique employed in the analysis is the reduction of the repeated game to a family of static games

rent seeking for pure public goods in this paper we present a formal analysis of rent seeking for public goods by two or more groups with different numbers of individuals we begin by considering equally wealthy groups under risk neutrality a case which constitutes our basic model several surprising and interesting results emerge from the analysis of this basic case the problem is then extended to deal with a groups with different wealth levels and b risk aversion this last extension brings about a further crop of interesting and useful results

price support acreage controls and efficient redistribution this study is concerned with the combination of target price and acreage controls as the two major mechanisms of farm policy acreage controls are shown to enhance the efficiency of redistribution under a target price program more specifically this study demonstrates that if the traditional cobb douglas production function is assumed acreage controls do not enhance the efficiency of target price programs in the process of redistributing income to the farm sector the study proves that if the elasticity of substitution between land and all other inputs is less than one then the income redistributional costs are likely to be reduced moreover by using an empirical estimate of the elasticity of substitution and farm data for the time period 1984 88 this study demonstrates that acreage control programs have drastically reduced the deadweight losses associated with income redistribution flowing from target price programs these results lend strong support to the public choice notion that politicians favo

introduction to repeated games with private monitoring abstract we present a brief overview of recent developments in discounted repeated games with imperfect private monitoring the literature explores the possibility of cooperation in a long term relationship where each agent receives imperfect private information about the opponents actions although this class of games admits a wide range of applications such as collusion under secret price cutting exchange of goods with uncertain quality and observation errors it has fairly complex mathematical structure due to the lack of common information shared by players this is in sharp contrast to the well explored case of repeated games under public information with the celebrated folk theorems and until recently little had been known about the private monitoring case however rapid developments in the past few years have revealed the possibility of cooperation under private monitoring for some class of games journal of economic literature classification numbers c72 c73 d43 d82 l13 l41

long run equilibrium and total expenditures in rent seeking the lure of excess profits or rents associated with monopoly power gives rise to expenditures to obtain these rents competitive rent seeking behavior is recognized as a factor which must be included among the wastes associated with monopoly power tullock 1967 posner 1975 1 the expenditures are aimed at transferring wealth rather than its creation and the use of resources to obtain this transfer is a loss to society how important rent seeking is as a part of the total monopolistic waste hinges on the size of the total expenditures induced by a given level of excess profits

migration and economic mobility in tanzania evidence from a tracking survey this study explores the extent to which migration has contributed to improved living standards of individuals in tanzania using longitudinal data on individuals the authors estimate the impact of migration on consumption growth between 1991 and 2004 the analysis addresses concerns about heterogeneity and unobservable factors correlated with both income changes and the decision to migrate the findings show that migration adds 36 percentage points to consumption growth during a period of considerable growth in consumption these results are robust to numerous tests and alternative specifications unpacking the findings the analysis finds that moving out of agriculture is correlated with much higher growth than staying in agriculture although growth is always higher in any sector if one physically moves economic mobility is strongly linked to geographic mobility the puzzle is why more people do not move if returns to geographic mobility are high the evidence is consistent with models in which exit barriers are set by home communities through social and family norms that prevent migration of certain categories of people

repeated games with private monitoring two players we investigate two player infinitely repeated games where the discount factor is less than but close to unity monitoring is private and players cannot communicate we require no condition concerning the accuracy of players monitoring technology we show the folk theorem for the prisoners dilemma with conditional independence we also investigate more general games where players private signals are correlated only through an unobservable macro shock we show that efficiency is sustainable for generic private signal structures when the size of the set of private signals is sufficiently large finally we show that cartel collusion is sustainable in price setting duopoly

a theory of competition among pressure groups for political influence this paper presents a theory of competition among pressure groups for political influence political equilibrium depends on the efficiency of each group in producing pressure the effect of additional pressure on their influence the number of persons in different groups and the deadweight cost of taxes and subsidies an increase in deadweight costs discourages pressure by subsidized groups and encourages pressure by taxpayers this analysis unifies the view that governments correct market failures with the view that they favor the politically powerful both are produced by the competition for political favors

microeconomic uncertainties facilitate cooperative alliances and social welfare abstract we show that microeconomic chaotic variations of payoffs in the prisoner s dilemma game maintain cooperation over a broad range of defection temptation values where otherwise economic stalemate reigns thus unpredictability at micro scales impedes mutual defection that inflicts social poverty

the cost of rent seeking evidence from cellular telephone license lotteries the inventors of the theory of rent seeking used an analogy with competitive markets to conclude that all monopoly rents would be dissipated in the competition to obtain the property rights to them 23 29 subsequent theorists showed that this conclusion is quite sensitive to assumptions about foresight risk aversion conjectures and bias 15 21 30 since little quantitative information about actual rent seeking competitions is available the theory has developed in an empirical vacuum in this paper we attempt to fill that vacuum with an estimate of rent seeking expenditure by applicants in the federal communications commission s fcc cellular telephone license lotteries held between 1986 and 1989 we go on to compare expenditures with estimates of the value of the licenses at stake these lotteries constitute a unique natural experiment any u s citizen was eligible to enter each geographic lottery once and only once for an expense which we calculate as modest the lotteries were widely publicized and heavily entered there were over 320 000 applications one per market filed for 643 cellular licenses and third party application preparers entered the market rapidly because licenses were awarded sequentially prospective participants in later lotteries could find out that expected net returns from earlier lotteries were positive because of undersubscription the value of the prize was known because sales of previously awarded licenses had begun to take place before later lotteries were held and market analysts were using such sale prices to value licenses not yet awarded the later lotteries seem almost optimally contrived to maximize the dissipation of rents yet comparing the resources invested in entry the price of a fully prepared application with the rents available the market value of cellular telephone licenses shows that dissipation was far short of complete

the repeated prisoner s dilemma with imperfect private monitoring abstract in this paper i study a repeated prisoner s dilemma game in which monitoring is private and imperfect a partial folk theorem is proved for the case of almost perfect monitoring

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

belief based equilibria in the repeated prisoners dilemma with private monitoring abstract we analyze repeated prisoners dilemma games with imperfect private monitoring and construct mixed trigger strategy equilibria such strategies have a simple representation where a player s action only depends upon her belief that her opponent s are continuing to cooperate when monitoring is almost perfect the symmetric efficient outcome can be approximated in any prisoners dilemma game while every individually rational feasible payoff can be approximated in a class of such games the efficiency result extends when there are more than two players it requires that monitoring be sufficiently accurate but does not require very low discounting when a public randomization device is available journal of economic literature classification numbers c73 d82

are remittances a substitute for credit carrying the financial burden of health shocks in national and transnational households summary this paper tests for the assumption that remittances are a substitute for credit by comparing the response to health related shocks among national and transnational households using mexican household panel data while the occurrence of serious health shocks that required hospital treatment doubled the average debt burden of exposed households compared to the control group households with nuclear family members a parent child or spouse in the us did not increase their debts due to health shocks this finding is consistent with the view that remittances respond to households demand for financing emergencies and make them less reliant on debt financing

interest group competition over policy outcomes dynamics strategic behavior and social costs this paper analyzes a two period model of interestgroup competition between two groups to affect thepolicy outcome the paper characterizes the subgameperfect equilibrium and considers the welfareimplications of the model the subgame perfectequilibrium to this game is allocatively efficient ifand only if the initial equilibrium is allocativelyefficient and interest groups are equally adept atproducing political pressure when rent seeking isconstitutionally protected the notion of rent seekingconstrained efficiency is defined as the cooperativesolution to the rent seeking game it is shown that arent seeking constrained efficient equilibrium isattainable by forcing winners in political competitionto fully compensate losers

land retirement and nonfarm labor market participation an analysis of china s sloping land conversion program summary china s sloping land conversion program pays more than 32 million households to plant trees on highly erodible cropland and has effected major land use changes farmers retire land indefinitely but receive time limited subsidies after which they in principle enter nonfarm employment we analyze annual data we collected on over 3 000 individuals and plots from 1998 2006 which contain variation in enrollment timing and alternative measures of enrollment and conclude enrollment has a small but significant and robust positive effect on nonfarm employment it arises not from alleviating constraints as recent papers have suggested but rather from simple farm to nonfarm labor substitution

flights towards defection in economic transactions we show that levy distributed variations of payoffs in the prisoner s dilemma game impede cooperation as the frequency of rare events increases levy flights thus facilitate defection but also uphold the evolutionary process arguably maintaining a healthy level of competitiveness amongst the agents

brain drain from turkey an investigation of students return intentions the emigration of skilled individuals from turkey attracted greater media attention and the interest of policymakers in turkey particularly after the experience of recurrent economic crises that have led to an increase in unemployment among the highly educated young this study estimates a model of return intentions using a data set compiled from an internet survey of turkish students residing abroad the findings of this study indicate that as expected higher salaries offered in the host country and lifestyle preferences including a more organized environment in the host country increase the probability of student nonreturn however the analysis also points to the importance of prior return intentions and the role of the family in the decision to return to turkey or stay overseas it is also found that the compulsory service requirement attached to government scholarships increases the probability of student return turkish student association membership also increases return intentions longer sta

defying the law of gravity the political economy of international migration bilateral flows of international migrants exhibit tremendous variance both across destination countries and over time to explain this variance studies of international migration tend to focus on economic determinants such as income differentials or on social conditions such as the presence of coethnics in certain destination countries the authors argue that migration is driven not solely by economic or social determinants rather the political environment across destinations plays a substantively large role in influencing bilateral migration flows they test the importance of the political environment citizenship rights and the prominence of right wing parties using data on migration flows from 178 origin countries into 18 destination countries over the period 1980 2006 they find even after controlling for a variety of economic social policy and international variables that variation in political environments across time and destination plays a key role in observed patterns of international migration

global talent local careers circular migration of top indian engineers and professionals despite heightened interests from policy makers in the notion of brain circulation the discussion around the issue has remained largely theoretical drawing upon unique data of the alumni of a leading indian university this study examines how migration dynamics unfold within a highly educated population whose emigration is considered as a classic example of brain drain we adopt an integrative framework bringing together macro level push and pull influences and individual level selectivity we find that disparity in economic development between countries drives migration flows in both directions while host country demand has a stronger impact on out migration than on return migration we also detect significant selection effects at the individual level top students are more likely to emigrate and less likely to return in out migration flowing out of the country appear to be the best and the brightest amongst the highly educated talent pool in return migration negative selection is manifested in multiple aspects including ability post migration human capital investment and income we also find that the influences of macro forces vary amongst individuals higher ability individuals appear to be less affected by demand changes the findings have important policy implications for both source countries and receiving countries

fishing and nonfishing income decisions the role of human capital and family structure resource dependent households often diversify their income we model demand for remittances and supply of off resource labor as a joint decision and discuss household trade offs we extend the off farm labor supply literature to a rural fishery contrasting our results to common findings in the farm literature and providing empirical evidence of the interdependence between education and family structure in determining income diversification using a unique dataset from malaysia we find that more educated households are less likely to diversify their income with caveats depending on family composition policy implications for resource management in a remittance economy with alternative livelihoods are discussed

john nash and the analysis of strategic behavior abstract this essay describes one economist s view of how four extraordinary papers by john nash two on non cooperative game theory proceedings of the national academy of sciences usa 36 1950b 48 49 annals of mathematics 54 1951 286 295 and two on the theory of bargaining econometrica 18 1950a 155 162 econometrica 21 1953 128 140 influenced the development of game theory as a tool for analyzing strategic behavior

the dynamics of lobbying a differential game this paper presents a dynamic model on lobbying the interactions between two competing lobbies who attempt to influence regulations and legislation are modelled as a differential game we consider for this game first a time consistent and then a subgame perfect equilibrium in linear markov strategies the subgame perfect equilibrium lowers considerably lobbying activity and expenses this provides a partial explanation of the puzzle that rent seeking expenses are often small compared with the prize sought