beyond gdp the quest for a measure of social welfare this paper critically examines the various approaches to the measurement of individual well being and social welfare that have been considered for the construction of alternatives to gdp special attention is devoted to recent developments in the analysis of sustainability in the study of happiness in the theory of social choice and fair allocation and in the capability approach it is suggested in the conclusion that although convergence toward a consensual approach is not impossible for the moment not one but three alternatives to gdp are worth developing jel i31 e23 e01

women work and divorce in this paper the author presents evidence that adds support to the economic approach to divorce and shows that the divorce rate is significantly and substantially affected by the earning ability of women in market work data are drawn from the u s farm sector after a brief overview of the economic theory of divorce and its relevance to the farm sector data sources and regression specifications are discussed excerpt

competition wages and teacher sorting lessons learned from a voucher reform this paper studies how local school competition affects teacher wages at markets where wages are set via individual wage bargaining using regional variation in private school entry generated by a swedish reform which allowed private schools to enter freely and a comprehensive matched employer employee data covering all high school teachers in sweden over 16 years i analyze the effects of competition on wages as well as labor flows the results suggest that competition translates into higher wages also for teachers in public schools while the average increases are modest new teachers gain 2 percent and high ability teachers in math and science receive 4 percent higher wages in the most competitive areas compared to areas without any competition from private schools several robustness checks support a causal interpretation of the results which together highlight the potential gains from school competition through a more differentiated wage setting of teachers

a note on national income in a dynamic economy abstract we review the properties of the static measure of changes in economic welfare national income in a dynamic economy it is possible to establish attractive welfare properties by rather simple arguments and this can be estimated from current data its welfare properties are preferable to those of net national product and comparable to those of the state valuation function

social indicators and comparisons of living standards abstract construction of an international index of standards of living incorporating social indicators and economic output typically involves scaling and weighting procedures that lack welfare economic foundations revealed preference axioms can be used to make quality of life comparisons if we can estimate the representative household s production technology for the social indicators this method is applied to comparisons of gross domestic product gdp and life expectancy for 58 countries neither gdp rankings nor the rankings of the human development index hdi are consistent with the partial ordering of revealed preference a method of constructing a utility consistent index incorporating both consumption and life expectancy is suggested

using maimonides rule to estimate the effect of class size on scholastic achievement the twelfth century rabbinic scholar maimonides proposed a maximum class size of 40 this same maximum induces a nonlinear and nonmonotonic relationship between grade enrollment and class size in israeli public schools today maimonides rule of 40 is used here to construct instrumental variables estimates of effects of class size on test scores the resulting identiecation strategy can be viewed as an application of donald campbell s regression discontinuity design to the class size question the estimates show that reducing class size induces a signiecant and substantial increase in test scores for fourth and efth graders although not for third graders when asked about their views on class size in surveys parents and teachers generally report that they prefer smaller classes this may be because those involved with teaching believe that smaller classes promote student learning or simply because smaller classes offer a more pleasant environment for the pupils and teachers who are in them mueller chase and walden 1988 social scientists and school administrators also have a longstanding interest in the class size question class size is often thought to be easier to manipulate than other school inputs and it is a variable at the heart of policy debates on school quality and the allocation of school resources in many countries see e g robinson 1990 for the united states ofsted 1995 for the united kingdom and moshel ravid 1995 for israel this broad interest in the consequences of changing class size

valuing school quality using boundary discontinuities abstract existing research shows that house prices respond to local school quality as measured by average test scores however higher test scores could signal higher academic value added or higher ability more sought after intakes in our research we show that both school value added and student prior achievement linked to the background of children in schools affect households demand for education in order to identify these effects we improve the boundary discontinuity regression methodology by matching identical properties across admissions authority boundaries by allowing for boundary effects and spatial trends by re weighting our data towards transactions that are closest to district boundaries by eliminating boundaries that coincide with major geographical features and by submitting our estimates to a number of novel falsification tests our results survive this battery of tests and show that a one standard deviation change in either school average value added or prior achievement raises prices by around 3

productivity in public services abstract this paper discusses issues arising in the measurement of productivity in public services compared to measuring productivity in the private sector difficulties arise because the output of public services is often unpriced and because some public services are consumed collectively a key problem is measuring the full range of outputs and quality improvements delivered by public sector organizations that are valued by society without comprehensive measures of output productivity statistics may be misleading i outline methods used in the measurement of both private and public sector productivity and discuss the measurement of public sector productivity in practice finally i discuss studies that examine factors underlying productivity differences and productivity growth in public and private sector organizations public sector reforms and the use of pilot schemes in public sector organizations present opportunities for research to identify causal effects on productivity

the effect of charter schools on achievement and behavior of public school students abstract charter schools have seen dramatic growth over the last decade however we know little about how they affect traditional public schools i look at how charters affect student outcomes in public schools using data from a large urban school district in the southwest unlike prior work that relies on school fixed effects i address the endogenous location of charter schools using an instrumental variables strategy that relies on plausibly exogenous variation in local building supply results show that charters induce modest but statistically significant drops in math and language test scores particularly for elementary students however results for middle and high school students show improvements in discipline

an economic model of cohabitation and divorce abstract the positive correlation between the rates of cohabitation and divorce has long been established this paper seeks to determine the direction of causation between these two variables a simultaneous equations model is specified with cohabitation and divorce rates as endogenous variables and using data aggregated to the state level for 1990 this procedure suggests that the divorce rate is a significant factor in explaining variations across states in the cohabitation rate and that the divorce rate is itself influenced by cohabitation behavior this finding strengthens the results put forth by various economic and sociological single equation studies this synthesis of information and data provided by sociologists with economic theory and methodology suggests further research in modelling demographic variables as joint outcomes of the same process

consumer s surplus as an exact approximation when prices are appropriately deflated a canonical price normalized form is proposed as a generalization of the ordinary consumer s surplus expression commonly used to evaluate changes in economic welfare this familiar looking formula it is proved can be rigorously interpreted as representing the first and second order terms of a taylor series expansion for the equivalent variation or willingness to pay function of a single consumer in principle the lowly consumer s surplus triangle and rectangle methodology can be rigorously defended as an exact approximation to a theoretically meaningful measure as long as prices are appropriately deflated the appropriate price deflator is derived and some implications are discussed

the quantity and quality of life and the evolution of world inequality gdp per capita is usually used to proxy for the quality of life of individuals living in different countries welfare is also affected by quantity of life however as represented by longevity this paper incorporates longevity into an overall assessment of the evolution of cross country inequality and shows that it is quantitatively important the absence of reduction in cross country inequality up to the 1990s documented in previous work is in stark contrast to the reduction in inequality after incorporating gains in longevity throughout the post world war ii period health contributed to reduce significantly welfare inequality across countries this paper derives valuation formulas for infra marginal changes in longevity and computes a full growth rate that incorporates the gains in health experienced by 96 countries for the period between 1960 and 2000 incorporating longevity gains changes traditional results countries starting with lower income tended to grow faster than countries starting with higher income we estimate an average yearly growth in full income of 4 1 percent for the poorest 50 percent of countries in 1960 of which 1 7 percentage points are due to health as opposed to a growth of 2 6 percent for the richest 50 percent of countries of which only 0 4 percentage points are due to health additionally we decompose changes in life expectancy into changes attributable to 13 broad groups of causes of death and three age groups we show that mortality from infectious respiratory and digestive diseases congenital perinatal and ill defined conditions mostly concentrated before age 20 and between ages 20 and 50 is responsible for most of the reduction in life expectancy inequality at the same time the recent effect of aids together with reductions in mortality after age 50 due to nervous system senses organs heart and circulatory diseases contributed to increase health inequality across countries

longitudinal studies of human growth and health a review of recent historical research longitudinal studies of health this paper reviews recent literature using stature and weight as measures of human welfare with a particular interest in cliometric or historical research we begin with an overview of anthropometric evidence of living standards and the new but fast growing field of anthropometric history this literature is always implicitly and often explicitly longitudinal in nature we then discuss i systematic empirical research into the relationship between conditions in early life and later life health and mortality and ii historical evidence on the relationship between body mass morbidity and mortality we conclude with a discussion of the importance of historical sources and understandings to health economics and population health

welfare analysis of tax reforms using household data abstract this paper discusses a methodology for calculating the distribution of gains and losses from a policy change using data for a large sample of households estimates are based on the equivalent income function which is money metric utility defined over observable variables this enables calculations to be standardised and a computer program to compute the statistics presented in the paper is available for a general demand system equivalent income is related to measures of deadweight loss and standard errors are computed for each of the welfare measures an application to u k data for 5 895 households is given which simulates a reform that involves eliminating housing subsidies

on measuring deprivation and the standard of living in a multidimensional framework on the basis of aggregate data in measuring social deprivation in a multidimensional framework ideally one should first measure each individual s overall deprivation and then aggregate the overall deprivation levels of all individuals however given only aggregate data one is often forced to measure social deprivation in terms of each attribute separately and then to aggregate them so as to get the overall social deprivation this paper shows that it is only under extremely stringent conditions that this procedure would always yield the same result as the conceptually sound procedure referred to earlier a similar difficulty also arises in measuring a society s standard of living

testing crime and punishment abstract the recent passage of the no child left behind act of 2001 solidified a national trend toward increased student testing for the purpose of evaluating public schools this new environment for schools provides strong incentives for schools to alter the ways in which they deliver educational services this paper investigates whether schools may employ discipline for misbehavior as a tool to bolster aggregate test performance to do so this paper utilizes an extraordinary data set constructed from the school district administrative records of a subset of the school districts in florida during the 4 years surrounding the introduction of a high stakes testing regime it compares the suspensions of students involved in each of the 41 803 incidents in which two students were suspended and where prior test scores for both students are observed while schools always tend to assign harsher punishments to low performing students than to high performing students throughout the year this gap grows substantially during the testing window moreover this testing window related gap is only observed for students in testing grades in summary schools apparently act on the incentive to re shape the testing pool through selective discipline in response to accountability pressures

a general proposition on the design of a neutral business tax abstract a simple and general means of levying a business tax that is neutral in the sense that it does not affect the firm s decisions at the margin is discussed in particular we analyze the effect of a business tax of our design on the investment decision of the firm the well known imputed income and immediate write off methods of levying a neutral business tax are found to be special cases of our general tax design the implication of our results is that a neutral pure profits tax can be levied without the informational difficulties of the imputed income method or the cash flow disadvantages of the immediate write off method

aggregate deadweight loss and money metric social welfare an econometric approach to the measurement of aggregate deadweight loss is proposed that does not require restrictive assumptions about preferences for validity the measure can be interpreted as the loss in allocative efficiency and is independent of the distribution of individual welfare an approach that is pervasive in the literature is to sum the individual measures of deadweight loss and interpret the resulting index as a measure of social welfare the author shows that this approach is invalid unless individual preferences or the social ordering are severely restricted an alternative method of evaluating money metric social welfare that does not require these restrictions is presented copyright 1991 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

exact and superlative welfare change indicators an exact welfare change indicator is defined to be a known function of the price and quantity data for two periods for a utility maximizing consumer which is exactly equal to the hicksian equivalent variation a welfare change indicator is termed superlative if it is exactly equal to the equivalent variation for an expenditure function which has a second order approximation property the paper exhibits a number of superlative welfare change indicators and also reviews the earlier attempts of hicks and weitzman to obtain equivalent variation measures that had a second order approximation property

accountability incentives and behavior the impact of high stakes testing in the chicago public schools the recent federal education bill no child left behind requires states to test students in grades 3 to 8 each year and to judge school performance on the basis of these test scores while intended to maximize student learning there is little empirical evidence about the effectiveness of such policies this study examines the impact of an accountability policy implemented in the chicago public schools in 1996 1997 using a panel of student level administrative data i find that math and reading achievement increased sharply following the introduction of the accountability policy in comparison to both prior achievement trends in the district and to changes experienced by other large urban districts in the mid west however for younger students the policy did not increase performance on a state administered low stakes exam an item level analysis suggests that the observed achievement gains were driven by increases in test specific skills and student effort i also find that teachers responded strategically to the incentives along a variety of dimensions by increasing special education placements preemptively retaining students and substituting away from low stakes subjects like science and social studies

estimating consumption economies of scale adult equivalence scales and household bargaining power how much income would a woman living alone require to attain the same standard of living that she would have if she were married what percentage of a married couple s expenditures are controlled by the husband how much money does a couple save on consumption goods by living together versus living apart we propose and estimate a collective model of household behaviour that permits identification and estimation of concepts such as these we model households in terms of the utility functions of its members a bargaining or social welfare function and a consumption technology function we demonstrate generic non parametric identification of the model and hence of a version of adult equivalence scales that we call indifference scales as well as consumption economies of scale the household s resource sharing rule or members bargaining power and other related concepts copyright 2013 oxford university press

fair production and allocation of an excludable nonrival good we study fairness in economies with one private good and one partially excludable nonrival good a social ordering function determines for each profile of preferences an ordering of all conceivable allocations we propose the following free lunch aversion condition if the private good contributions of two agents consuming the same quantity of the nonrival good have opposite signs reducing that gap improves social welfare this condition combined with the more standard requirements of unanimous indifference and responsiveness delivers a form of welfare egalitarianism in which an agent s welfare at an allocation is measured by the quantity of the nonrival good that consumed at no cost would leave her indifferent to the bundle she is assigned

the social cost of living index abstract household cost of living indexes reflect household preferences analogous indexes for groups of households require a corresponding concept of group preferences in this paper i investigate the social cost of living index a group index based on the bergson samuelson social welfare function i first define the index and examine its properties under the assumption that the investigator constructing it expresses his distributional judgments in an explicit bergson samuelson social welfare function i then examine the maximizing society and the independent society two cases in which the index can be constructed from the information contained in the market demand functions in these two cases a laspeyres index i e the fixed weight index based on the reference consumption pattern is an upper bound on the exact social cost of living index in general however the assumptions required to place bounds on the social cost of living index are much more likely to be satisfied than those required to place analogous bounds on a household s cost of living index

a democratic measure of household income growth theory and application to the united kingdom this paper develops a price and quantity system of indicators structured round atkinson s concept of inequality aversion a democratic indicator of income growth weighting each household s growth experience equally is shown to result when prais democratic price index is used to deflate the geometric mean of equivalised household income a welfare interpretation of the democratic indicator of income growth is provided and it is shown that with heterogeneous but homothetic preferences the deflator can serve as a common scaling social cost of living index when applied to income as well as to consumption application to united kingdom household data suggests that over the interval 2005 6 2015 6 democratic real equivalised household income grew by 0 20 per cent per annum while the plutocratic equivalent grew by 0 52 per cent per annum

charter school entry and school choice the case of washington d c this paper develops and estimates an equilibrium model of charter school entry and school choice in the model households choose among public private and charter schools and a regulator authorizes charter entry and mandates charter exit the model is estimated for washington d c according to the estimates charters generate net social gains by providing additional school options and they benefit non white low income and middle school students the most further policies that raise the supply of prospective charter entrants in combination with high authorization standards enhance social welfare

does nnp growth indicate welfare improvement abstract we show that instantaneous increases in real nnp over time are an accurate indicator of true dynamic welfare improvements this highlights a connection between the theory of green or comprehensive national income accounting and the theory of real price indices

does competition among public schools benefit students and taxpayers tiebout choice among districts is the most powerful market force in american public education naive estimates of its effects are biased by endogenous district formation i derive instruments from the natural boundaries in a metropolitan area my results suggest that metropolitan areas with greater tiebout choice have more productive public schools and less private schooling little of the effect of tiebout choice works through its effect on household sorting this finding may be explained by another finding students are equally segregated by school in metropolitan areas with greater and lesser degrees of tiebout choice among districts

good principals or good peers parental valuation of school characteristics tiebout equilibrium and the incentive effects of competition among jurisdictions good principals or good peers parental valuation of school characteristics tiebout equilibrium and the incentive effects of competition among jurisdictions by j esse m r othstein school choice policies may by aligning admin istrators incentives with parental demand yield improved efficiency in educational production milton friedman 1962 john e chubb and terry m moe 1990 but eric a hanushek 1981 cautions if the efficiency of our school systems is due to poor incentives for teachers and admin istrators coupled with poor decision making by consumers it would be unwise to expect much from programs that seek to strengthen market forces in the selection of schools p 35 empha sis added poor decision making is not required parents may rationally choose schools with pleasant surroundings athletic facilities cultural advantages ibid p 34 over those that most efficiently pursue academic performance they may prefer poorly run schools with good peer groups over those that are more effective but en roll worse students j douglas willms and frank h echols 1992 1993 or they may simply be unable to identify effective schools thomas j kane and douglas o staiger 2002 any factor that leads parents to choose any but the most effective available schools will tend to dilute the incentives for efficient management that choice might otherwise create this study examines the distribution of stu dent outcomes across schools within metropol itan housing markets for evidence on parental demand economists have long noted that par ents choices among residential locations are potentially informative about how more com plete choice systems may operate charles m tiebout 1956 melvin v borland and roy m howsen 1992 caroline m hoxby 2000 rothstein 2005 1 i ask whether school effec tiveness plays a sufficiently important role in these decisions to create meaningful incentives for more productive school management i adopt a specific understanding of effective ness appropriate to the question at hand a substantial portion of between school differ ences in student performance can be attributed to differences in student body composition this portion includes the effects of individual stu dent characteristics on their own test scores any direct peer group effects and any indirect ef fects of a school s composition on the quality of its instruction if wealthy schools attract better teachers joseph r antos and sherwin rosen 1975 or more parental involvement this is for my purposes a peer effect it depends on the quality of the school s administration only via school composition a school administrator cannot attract demand by offering a school with wealthy students as these can be offered only if wealthy families demand the school in the first place only the remaining portion of a school s contribution to test scores is effectiveness 2 department of economics and woodrow wilson school princeton university wallace hall 3 rd floor princeton nj 08544 e mail jrothst princeton edu i thank alan auerbach tom davidoff caroline hoxby jus tin mccrary rob mcmillan john quigley cecilia rouse emmanuel saez till von wachter four anonymous refer ees editor robert moffitt seminar participants at several institutions and especially david card for helpful sugges tions i am grateful to the college board for essential data and to a national science foundation graduate research fellowship and the fisher center for real estate and urban economics at uc berkeley for funding see cecilia elena rouse 1998 julie b cullen et al 2005 william g howell et al 2002 and alan b krueger and pei zhu 2004 for analyses of several existing nonresidential choice programs though none focuses on the particular issue studied here this definition avoids the need to find observable de terminants of effectiveness which have proved elusive hanushek 1986 my definition however ignores a school s contribution to nontest outcomes e g sports or music if such outcomes motivate parental choices i will conclude that parents do not demand effective schools of

the performance and competitive effects of school autonomy this paper studies a recent british reform that allowed public high schools to opt out of local authority control and become autonomous schools funded directly by the central government schools seeking autonomy had only to propose and win a majority vote among current parents almost one in three high schools voted on autonomy between 1988 and 1997 and using a version of the regression discontinuity design i find large achievement gains at schools in which the vote barely won compared to schools in which it barely lost despite other reforms that ensured that the british education system was by international standards highly competitive a comparison of schools in the geographic neighborhoods of narrow vote winners and narrow vote losers suggests that these gains did not spill over

improving human development a long run view abstract the pessimistic flavour of the human development reports appears to be in contradiction with their own numbers as developing countries fare comparatively better in human development than in per capita gdp terms this paper attempts to bridge this gap by providing a new improved human development index ihdi informed by welfare economics the ihdi is presented here alongside the united nations development programme s undp hdi for the world and its main regions since the late 19th century social dimensions in the ihdi are derived following kakwani journal of development economics 41 1993 pp 307 336 with a convex achievement function whereas a geometric average is employed to combine its dimensions longevity knowledge and income thus the ihdi does not conceal the gap between rich and poor countries and casts a much less optimistic view than the conventional undp index while it fits with the undp concern for international differences the paper s findings highlight main weaknesses in human development dimensions of present day developing countries

your money or your life green growth policies and welfare in 2050 this paper proposes a simple index of economic progress that weighs in the monetary cost induced by climate change mitigation policies as well as the health benefits arising from the reduction in local air pollution the shadow price of pollution is calculated indirectly through its impact on life expectancy taking into account the health benefits of mitigation policies significantly reduces their monetary cost in china and india as well as in countries with large fossil based energy producing sectors australia canada and the united states

the opportunity criterion consumer sovereignty without the assumption of coherent preferences this paper proposes a formulation of consumer sovereignty for use in normative economics which does not presuppose individuals preferences to be coherent the fundamental intuition that opportunity and responsibility have moral value is formalised as a responsibility criterion for assessing opportunities in an economic system a model of an exchange economy is presented in which rational arbitrageurs compete to make profits by trading with non rational consumers in equilibrium this economy satisfies the responsibility criterion one interpretation of this result is that in a competitive environment the overall effects of money pumps are benign even if individuals preferences are persistently incoherent

the public choice of educational choice the very small literature explaining i how citizens have voted in two california voucher referenda ii how legislators have voted on voucher bills in the state of florida and the us congress and iii the variation across states in charter school provisions is summarized new empirical evidence documenting the cross state variation in the success of voucher referenda and voucher bills is examined voucher bill characteristics and state characteristics play important roles voucher bills have been passed only in the more conservative republican states and almost all of the successful voucher programs have been targeted at large struggling school districts

the electoral dynamics of human development this paper analyses the impact of elections on the dynamics of human development in a panel of 82 countries over the period 1980 2013 the incidence of partisan and political support effects is also taken into account a gmm estimator is employed in the empirical analysis and the results point out to the presence of an electoral cycle in the growth rate of human development majority governments also influence it but no clear evidence is found regarding partisan effects the electoral cycles have proved to be stronger in non oecd countries in countries with less frequent elections with lower levels of income and human development in presidential and non plurality systems and in proportional representation regimes they have also become more intense in this millennium

decentralization and access to social services in colombia decentralization is meant to improve access to public services but relatively few studies examine this question empirically we explore the effects of decentralization on access to health and education in colombia using an original database covering over 95 of colombian municipalities we show that decentralization improved enrollment rates in public schools and access of the poor to public health services in both sectors improving access was driven by the financial contributions of local governments small increases in own shares of spending led to surprisingly large increases in the access of the poor in both sectors our theoretical model implies that where local information dominates productive efficiency elected local governments will provide services better tailored to local needs decentralizing such services should increase their use by the public together theory and empirics imply that decentralization made the colombian state more accountable it provided local officials with the information and incentives they need to allocate resources in a manner responsive to voters needs and improve the impact of public expenditures

corrupting learning evidence from missing federal education funds in brazil abstract this paper examines if money matters in education by looking at whether missing resources due to corruption affect student outcomes we use data from the auditing of brazil s local governments to construct objective measures of corruption involving educational block grants transferred from the central government to municipalities using variation in the incidence of corruption across municipalities and controlling for student school and municipal characteristics we find a significant negative association between corruption and the school performance of primary school students students residing in municipalities where corruption in education was detected score 0 35 standard deviations less on standardized tests and have significantly higher dropout and failure rates using a rich dataset of school infrastructure and teacher and principal questionnaires we also find that school inputs such as computer labs teaching supplies and teacher training are reduced in the presence of corruption overall our findings suggest that in environments where basic schooling resources are lacking money does matter for student achievement

genuine progress indicator 2 0 pilot accounts for the us maryland and city of baltimore 2012 2014 abstract for over thirty years the genuine progress indicator gpi has been used to evaluate economic performance quantify benefits and costs of growth and predict effects of policy changes on economic wellbeing the popularity and use of the metric is increasing partially in response to new global demands for metrics that go beyond gross domestic product gdp however because the basic gpi accounting protocols have yet to be consistently updated to respond to theoretical critiques new valuation methods and new data sources a proliferation of studies at the global national and sub national level contain widely divergent methodologies because of this gpi practitioners have called for a new consistent framework to guide future gpi studies gpi 2 0 this paper is an attempt to operationalize some of the concepts that have emerged from gpi 2 0 deliberations online and at recent workshops in the form of gpi 2 0 pilot accounts for the us state of maryland and city of baltimore the goal is to demonstrate the feasibility of multi scale gpi accounts that provide a more accurate measure of current economic welfare than gdp and that incorporate new methods and sources of information to replace many of the outdated aspects of the prevailing gpi approach

on the welfare significance of national product under interest rate uncertainty abstract this paper examines the effects of uncertainty on the relationship between comprehensive nnp and sustainable equivalent consumption it is shown that the classical identity continues to hold in expectations when the discount factor is a stochastic diffusion process taking the form of geometric brownian motion with drift such a result may be useful as a point of departure for classifying the effects that various forms of uncertainty have on the welfare significance of national product

private school vouchers and student achievement an evaluation of the milwaukee parental choice program in 1990 wisconsin began providing vouchers to a small number of low income students to attend nonsectarian private schools controlling for individual fixed effects i compare the test scores of students selected to attend a participating private school with those of unsuccessful applicants and other students from the milwaukee public schools i find that students in the milwaukee parental choice program had faster math score gains than but similar reading score gains to the comparison groups the results appear robust to data imputations and sample attrition although these deficiencies of the data should be kept in mind when interpreting the results

the impact of school choice on student outcomes an analysis of the chicago public schools we explore the impact of school choice on student outcomes in the context of open enrollment within the chicago public schools cps roughly half of the students opt out of their assigned high school to attend a different cps school and these students are much more likely than those who remain in their assigned schools to graduate to determine the source of this apparent benefit we compare outcomes across i similar students with differential access to schooling options and ii travelers and non travelers within the same school the results suggest that other than for students who select career academies the observed cross sectional benefits are likely spurious

does management matter in schools we collect data on management practices in over 1 800 high schools in eight countries we show that higher management quality is strongly associated with better educational outcomes the uk sweden canada and the us obtain the highest management scores followed by germany with a gap before italy brazil and india we also show that autonomous government schools government funded but with substantial independence like uk academies and us charters have higher management scores than regular government or private schools almost half of the difference between the management scores of autonomous and regular government schools is accounted for principal leadership and governance there are major disparities in the quality of education within and between countries oecd 2012 school managerial practices may be an important reason for such differences unfortunately understanding the role of management in schools within and across countries has been held back by a lack of robust and comparable instruments to systematically measure management practices and thus a lack of good data the key purpose of this article is to develop an international management index for schools and present descriptive evidence on management quality and education outcomes across schools of different types within and across countries we used double blind telephone interviews with school principals to collect information on management practices for over 1 800 schools across eight countries to construct our management index we average across 20 basic management practice measures in four areas of management operations monitoring target setting and people each question is evaluated against a scoring grid that ranges from one worst practice to five best practice our management index for each school represents the average of these scores we also constructed measures of school level pupil outcomes for these schools when data were available from examination results across regions and countries creating a matched management pupil outcome international data set at the school level these data allow us to document some stylised facts first we show that the adoption of basic managerial practices varies significantly across and within countries the uk sweden canada and the us obtain the highest average scores followed by germany italy and brazil while india has the lowest scores about half of the variance in school management is at the country level this share is larger in education than we have

aggregate consumer behavior and the measurement of social welfare this paper describes a new approach to normative economics combining the theory of social choice with econometric modeling of aggregate consumer behavior we first derive a system of aggregate demand functions by exact aggregation over individual demand functions we then construct measures of individual welfare from systems of individual demand functions finally we incorporate these measures into a social welfare function introducing ethical assumptions based on horizontal and vertical equity to illustrate the application of this approach we consider the u s standard of living and its cost over the period 1947 1985 the purpose of this paper is to describe a remarkable convergence that has occurred between economic theory and econometrics over the past decade this conjunction has taken place between the theory of social choice and econometric modeling of aggregate consumer behavior the confluence of these two streams of research has produced a new approach to normative economics this approach has been successfully applied to the evaluation of economic policy the measurement of poverty and inequality and the assessment of the standard of living and its cost a common problem in the modeling of consumer behavior and social choice is the representation of individual preferences in the econometric modeling of aggregate consumer behavior the primary emphasis has been on simplifying aggregate demand functions the most familiar approach to this problem is the model of a representative consumer this model is required to justify applications of the theory of individual consumer behavior to aggregate data on prices and quantities consumed the simplest version of the model is based on identical homothetic preferences for all individuals under identical homothetic preferences aggregate quantities consumed are functions of aggregate expenditure and prices these functions have precisely the same properties as demand functions in the theory of individual consumer behavior the condition of identical homothetic preferences was weakened by gorman 1953 to permit displacements from the origin for individual demand functions gorman showed that a necessary and sufficient condition for aggregate demand functions to depend on aggregate expenditure is that all individu

equality of opportunity theory and measurement during the last third of the twentieth century political philosophers actively debated about the content of distributive justice the ruling ethical view of utilitarianism was challenged by various versions of equality of opportunities economists formulated several ways of modeling these ideas focusing upon how individuals are placed with respect to opportunities for achieving various outcomes and what compensation is due to individuals with truncated opportunities after presenting a review of the main philosophical ideas section 2 we turn to economic models sections 3 and 4 we propose a reformulation of the definition of economic development replacing the utilitarian measure of gdp per capita with a measure of the degree to which opportunities for income acquisition in a nation have been equalized finally we discuss issues that the econometrician faces in measuring inequality of opportunity briefly review the empirical literature section 6 and conclude section 7

a contribution to the theory of welfare accounting a kind of unified theory is proposed as a dynamic generalization of the standard consumer surplus methodology for evaluating welfare changes the unified theory allows rigorous dynamic welfare comparisons to be inferred between any two economic situations from just knowing current incomes and observing a short run market demand schedule essentially the change in present discounted future utility is exactly captured by the formula difference in current income plus consumer surplus this well known formula is thereby shown to cover a far wider class of welfare comparisons than is customarily treated in the textbook static case

looking through the dataquadrate characterizing the human environment relationship through economic hedonic ecological and demographic measures abstract this paper introduces the concept of plotting four dimensional data in two dimensions without loss of information namely the dataquadrate concept here objects are represented as quadrates instead of points in a practical 4 axis cartesian coordinate system this procedure helps us imagine and analyze complex relations where four different non negative variables influence processes this tool is of high utility for analyzing specific human environment issues here we analyze a monetary measure gross domestic product gdp a hedonic measure subjective wellbeing a limiting measure ecological footprint and a demographic measure human population our system adds new insights to the de growth debate discussed in a journal of cleaner production special issue vol 18 2010 and systematically illuminates lots of confusing paradoxes such as the downward sloping part of the environmental kuznets curve the jevons paradox and the easterlin paradox in this paper all these phenomena are analyzed for the usa and for china in 1990 and in 2007 by utilizing such methodology when mitigating environmental problems we are not limited to negative restrictive messages but are enabled to create new strategic ways of problem solving about how to optimize the human celestial footprint the ratio of human wellbeing to human environmental load

school vouchers a survey of the economics literature we review the theoretical computational and empirical research on school vouchers with a focus on the latter our assessment is that the evidence to date is not sufficient to warrant recommending that vouchers be adopted on a widespread basis however multiple positive findings support continued exploration specifically the empirical research on small scale programs does not suggest that awarding students a voucher is a systematically reliable way to improve educational outcomes and some detrimental effects have been found nevertheless in some settings or for some subgroups or outcomes vouchers can have a substantial positive effect on those who use them studies of large scale voucher programs find student sorting as a result of their implementation although of varying magnitude evidence on both small scale and large scale programs suggests that competition induced by vouchers leads public schools to improve moreover research is making progress on understanding how vouchers may be designed to limit adverse effects from sorting while preserving positive effects related to competition finally our sense is that work originating in a single case e g a given country or in a single research approach e g experimental designs will not provide a full understanding of voucher effects fairly wide ranging empirical and theoretical work will be necessary to make progress

fiscal decentralization and natural hazard risks at least to some extent due to pressure from international donors many countries have become more fiscally decentralized the underlying premise being that greater decentralization might improve the provision of local public goods and services we test this proposition by determining whether relatively more decentralized countries fare better when natural disasters strike in terms of its effects on the population overall we find evidence supporting our maintained hypothesis though the effect appears much more robust in developing countries

performance pay and teachers effort productivity and grading ethics this paper presents evidence about the effect of individual monetary incentives on english and math teachers in israel teachers were rewarded with cash bonuses for improving their students performance in high school matriculation exams the main identification strategy is based on measurement error in the assignment to treatment variable that produced a randomized treatment sample the incentives led to significant improvements in test taking rates conditional pass rates and mean test scores improvements were mediated through changes in teaching methods enhanced after school teaching and increased responsiveness to students needs no evidence was found of manipulation of test scores by teachers

longitudinal studies of human growth and health a review of recent historical research this paper reviews recent literature using stature and weight as measures of human welfare with a particular interest in cliometric or historical research we begin with an overview of anthropometric evidence of living standards and the new but fast growing field of anthropometric history this literature is always implicitly and often explicitly longitudinal in nature we then discuss i systematic empirical research into the relationship between conditions in early life and later life health and mortality and ii historical evidence on the relationship between body mass morbidity and mortality we conclude with a discussion of the importance of historical sources and understandings to health economics and population health

good and bad growth the human development reports abstract the 1996 human development report undp 1996 is about economic growth and human development in keeping with past reports in the series it emphasizes the diversity of country performance in improving human development indicators at given rates of growth this article reviews what the human development reports have said on this topic looking at how well the main messages have been supported by data and analysis and how compelling they are as a basis for public action

the possibility of social choice the subject of social choice includes within its capacious frame various problems with the common feature of relating social judgments and group decisions to the views and interests of the individuals who make up the society or the group some challenges and foundational problems faced by social choice theory as a discipline are discussed social choice theory is a subject in which formal and mathematical techniques have been very extensively used voting based procedures are entirely natural for some kinds of social choice problems such as elections referendums or committee decisions they are however altogether unsuitable for many other problems of social choice impossibility results in social choice theory led by the pioneering work of arrow 1951 have often been interpreted as being thoroughly destructive of the possibility of reasoned and democratic social choice including welfare economics that view is argued against

evaluating projects and assessing sustainable development in imperfect economies we are interested in three related questions 1 how should accounting prices be estimated 2 how should we evaluate policy change in an imperfect economy 3 how can we check whether intergenerational well being will be sustained along a projected economic programme we do not presume that the economy is convex nor do we assume that the government optimizes on behalf of its citizens we show that the same set of accounting prices should be used both for policy evaluation and for assessing whether or not intergenerational welfare along a given economic path will be sustained we also show that a comprehensive measure of wealth computed in terms of the accounting prices can be used as an index for problems 2 and 3 above the remainder of the paper is concerned with rules for estimating the accounting prices of several specific environmental natural resources transacted in a few well known economic institutions

a conceptual exploration and critical inquiry into the theoretical foundation s of economic welfare measures abstract economic welfare measures ewm such as the isew and the gpi are often argued to lack a sound theoretical foundation however we observe that the initial ewm were jointly inspired by hicksian and fisherian income welfare s experiential nature is fisherian inspired whereas seeing the consumption of community capital e g the ecosystem as a cost is hicksian inspired as most scholars do not recognize this double theoretical foundation two distinct welfare interpretations with different time and boundary dimensions are often conflated ewm can be seen as either capturing the benefits and costs experienced or as reflecting the benefits and costs of present economic activities bcpa the former interpretation excludes future costs costs shifted abroad and capital changes as they are not experienced in the present while the latter includes them recent developments reveal that ewm are converging toward the ex post established experiential fisherian foundation formulated by lawn 2003 yet this is not the only way forward as the bcpa view offers an alternative to account for for instance the costs of present activities shifted abroad or to the future whether they are experienced or not to avoid inconsistencies ewm s standardization would greatly benefit from making explicit in future studies which interpretation is taken

beyond gdp an analysis of the socio economic diversity of european regions abstractthis paper aims to analyze the socioeconomic diversity of the european union eu 28 regions from a dynamic perspective for that purpose we combine a series of exploratory space time anal

blending top down federalism with bottom up engagement to reduce inequality in ethiopia donors increasingly fund interventions to counteract inequality in developing countries where they fear it can foment instability and undermine nation building efforts to succeed aid relies on the principle of upward accountability to donors but federalism shifts the accountability of subnational officials downward to regional and local voters what happens when aid agencies fund anti inequality programs in federal countries does federalism undermine aid does aid undermine federalism or can the political and fiscal relations that define a federal system resolve the contradiction internally this study explores this paradox via the promotion of basic services program in ethiopia the largest donor financed investment program in the world using an original panel database comprising the universe of ethiopian woredas districts the study finds that horizontal geographic inequality decreased substantially donor financed block grants to woredas increased the availability of primary education and health care services in the bottom 20 percent of woredas weaker evidence from household surveys suggests that vertical inequality across wealth groups within woredas also declined implying that individuals from the poorest households benefit disproportionately from increasing access to and utilization of such services the evidence suggests that by combining strong upward accountability over public investment with extensive citizen engagement on local issues ethiopia s federal system resolves the instrumental dissonance posed by aid funded programs to combat inequality in a federation

female earnings and the divorce rate a simultaneous equations model economists have contributed a great deal of research both theoretical and empirical to the study of marital formation and dissolution many empirical examinations of marriage and divorce rates exist based on becker s seminal contributions to the literature all of these divorce studies are single equation models with female earnings assumed exogenous as discussed by becker 1981 however causality may run in the opposite direction as well the divorce rate may influence female earnings this paper estimates a simultaneous equations model in which divorce rates and female earnings are the jointly endogenous variables data are by state for 1960 1970 1980 and 1990 the state wide divorce rate equation is an extension of waters and ressler 1999 and the specification of a state wide earnings equation follows standard human capital theory the specification of joint endogeneity between female earnings and the divorce rate allows valid inferences to be made regarding the effect of female earnings on

a non simplistic approach to composite indicators and rankings an illustration by comparing the sustainability of the eu countries composite indicators are very popular despite being affected by several problems that often result in lack of robustness of the rankings involved the aim of this paper is to show that composite indicators can be safely used provided that rankings are built via uncertainty analysis rather than using a single composite for this purpose the approach we follow first combines different normalisation aggregation rules and weighting systems to calculate many different composites and then derives the rankings from the frequency distribution of the rankings of each competitor according to each composite such an approach appears to be a good compromise between the need for a more concise overview when looking at many variables and the loss of relevant information occurring when indicators are aggregated into a single composite indicator to illustrate the approach we rank eu countries in terms of their sustainability

independent schools and long run educational outcomes evidence from sweden s large scale voucher reform this paper evaluates average educational performance effects of an expanding independentschool sector at the compulsory level by assessing a radical voucher reform that was implemented in sweden in 1992 starting from a situation where all public schools were essentially local monopolists the degree of independent schools has developed very differently across municipalities over time as a result of this reform we regress the change in educational performance outcomes on the increase in the share of independent school students between swedish municipalities we find that an increase in the share of independent school students improves average performance at the end of compulsory school as well as long run educational outcomes we show that these effects are very robust with respect to a number of potential issues such as grade inflation and pre reform trends however for most outcomes we do not detect positive and statistically significant effects until approximately a decade after the reform this is notable but not surprising given that it took time for independent schools to become more than a marginal phenomenon in sweden we do not find positive effects on school expenditures hence the educational performance effects are interpretable as positive effects on school productivity we further find that the average effects primarily are due to external effects e g school competition and not that independent school students gain significantly more than public school students

does greater school autonomy make a difference evidence from a randomized natural experiment in south korea abstract we exploit the unique features of high schools in seoul to study the effects of school autonomy on student outcomes under south korea s equalization policy both private and public schools in seoul admit students that are assigned randomly to them receive equal government funding charge identical fees and use similar curricula however private schools have greater flexibility in personnel decisions and their principals and teachers face stronger incentives to perform we find that private high schools have better student outcomes than public high schools our results suggest that autonomy in personnel decisions explains the positive student outcomes in private schools

accountability and flexibility in public schools evidence from boston s charters and pilots charter schools are publicly funded but operate outside the regulatory framework and collective bargaining agreements characteristic of traditional public schools in return for this freedom charter schools are subject to heightened accountability this paper estimates the impact of charter school attendance on student achievement using data from boston where charter schools enroll a growing share of students we also evaluate an alternative to the charter model boston s pilot schools these schools have some of the independence of charter schools but operate within the school district face little risk of closure and are covered by many of same collective bargaining provisions as traditional public schools estimates using student assignment lotteries show large and significant test score gains for charter lottery winners in middle and high school in contrast lottery based estimates for pilot schools are small and mostly insignificant the large positive lottery based estimates for charter schools are similar to estimates constructed using statistical controls in the same sample but larger than those using statistical controls in a wider sample of schools the latter are still substantial however the estimates for pilot schools are smaller and more variable than those for charters with some significant negative effects

social criteria for evaluating population change an alternative to the blackorby donaldson criterion abstract an ethical objection is raised against the blackorby donaldson criterion of optimum population maximizing the sum total of utilities in excess of some critical level since it may disprefer a social state with more people and with more worthwhile lives however the criterion may serve as a practicably reasonable compromise between maximizing total and average utility nevertheless an alternative compromise the maximization of number dampened total utility is proposed that is free from the above objection

ecological sufficiency individual liberties and distributive justice implications for policy making we investigate the prospects of voluntary ecological sufficiency for environmental and climate policy under the constraints implied by political liberalism we find that freedom of choice restricts sufficiency to rather wealthy societies and that a sufficiency threshold cannot be derived by referring to the poor sufficiency can be in conflict with the demands of social justice i e if the sufficiency threshold is below the social minimum implied by social justice benefits from sufficiency are highly related to individual perceptions such benefits cannot be expressed in a standard preference framework consequently alternative measures of welfare and inequality are required if sufficiency is a significant phenomenon in society standard environmental policies can have a pronounced interaction with voluntary sufficiency i e if quantity regulation is present overall the voluntary notion of sufficiency causes a dilemma as sufficiency is largely a matter of civil society however voluntary sufficiency is expected to make important contributions to the preservation of ecological resources if properly balanced with social and environmental policies and framed by public discursive control

informing climate adaptation a review of the economic costs of natural disasters abstract this paper reviews the empirical literature on the economic impacts of natural disasters to inform both the modeling of potential future climate damages and climate adaptation policy related to extreme events it covers papers that estimate the short and or long run economic impacts of weather related extreme events as well as studies identifying the determinants of the magnitude of those damages including fatalities the paper also reviews the small number of empirical papers on the potential extent of adaptation in response to changing extreme events

revenue recycling and the welfare effects of road pricing the authors explore the interaction between taxes on work related traffic congestion and preexisting distortionary taxes in the labor market a congestion tax raises the overall costs of commuting to work and discourages labor force participation at the margin when revenues are returned in lump sum transfers the resulting efficiency loss in the labor market can be larger that the pigouvian efficiency gains from internalizing the congestion externality by contrast if congestion tax revenues are used to reduce labor taxes the net impact on the labor supply is positive and the efficiency gain in the labor market can raise the overall welfare gains of the congestion tax by as much as 100 percent recycling congestion tax revenues in public transit subsidies produces a positive but smaller impact on the labor supply in short the authors results indicate that the presence of preexisting tax distortions and the form of revenue recycling can crucially affect the size and possibly even the sign of the welfare effect of road pricing schemes the efficiency gains from recycling congestion tax revenues in other tax reductions can amount to several times the pigouvian welfare gains from congestion reduction

the hartwick rule myths and facts we shed light on the hartwick rule for capital accumulation and resource depletion by providing semantic clarifications and investigating the implications and relevance of this rule we extend earlier results by establishing that the hartwick rule does not indicate sustainability and does not require substitutability between man made and naturalcapital we use a new class of simple counterexamples i to obtain the novel finding that a negative value of net investments need not entail that utility is unsustainable and ii to point out deficiencies in the literature

revisiting isew valuation approaches the case of spain including the costs of energy depletion and of climate change abstract this paper develops an index of sustainable economic welfare for spain from 1970 to 2012 and seeks to update valuation approaches to a number of items two approaches have proven particularly controversial over recent decades the costs of energy depletion and of climate change the valuation implications in measuring present welfare have proven problematic as both include future sustainability consequences arising from resource depletion and environmental impacts this study includes a transition cost approach to energy depletion a modified approach to costs of climate change and water pollution and removes the cost of ozone depletion the results illustrate that while gdp per capita increased significantly the isew per capita shows a widening gap household labour contributes strongly but income distribution energy depletion and costs of climate change limit improvement sensitivity analysis shows that accumulating climate change costs and escalating energy depletion costs have significant effects nevertheless the new valuation approaches do not alter conclusions that welfare has shown little improvement the isew provides a useful alternative to current indicators such as gdp subject to awareness of limitations it is a measure of welfare that uses sustainability accounting methods when estimating costs but is not an indicator of whether welfare is actually sustainable

international comparisons of living standards by equivalent incomes we propose a measure of living standards for international comparisons based on gdp per capita the measure incorporates corrections for international flows of income labor risk of unemployment healthy life expectancy household demography and inequalities the method for comparing populations that differ in some non income dimension consists of computing the equivalent variation of income that would make each population indifferent between its current situation and a reference situation with respect to the non income dimension this is applied to 24 oecd countries the obtained ranking of countries differs substantially from the gdp ranking

capabilities as menus a non welfarist basis for qaly evaluation quality adjusted life years qalys are the most widely used measure of health in economic evaluations of health care within a welfarist framework qalys are consistent with people s preferences under stringent assumptions several authors have argued that qalys are a valid measure of health within an extra welfarist framework this paper studies the applicability of qalys within the best known extra welfarist framework sen s capability approach we propose a procedure to value capability sets and provide a foundation for qalys within sen s capability approach we show that under appropriate conditions the ranking of capabilities can be represented locally by a qaly measure and that a willingness to pay for qalys can be defined the validity of qalys as a general measure of health requires the same stringent conditions as in a welfarist framework

a review article the case against the use of the sum of compensating variations in cost benefit analysis this paper presents a case against the use of the sum of compensating varia tions as a cost benefit test we argue that 1 the ethical judginents implied by the test are not defensible 2 positive sums of compensating variations occur without potential pareto improvements resulting in social preference reversals without simultaneous scitovsky re versals 3 when lump sum transfers are feasible a positive sum of compensating variations is necessary but not sufficient for a potential pareto improvement 4 in order to eliminate preference reversals and intransitivities all households must have almost identical quasi homothetic preferences a condition that is not satisfied in real economies