optimal dynamic pricing of inventories with stochastic demand over finite horizons in many industries managers face the problem of selling a given stock of items by a deadline we investigate the problem of dynamically pricing such inventories when demand is price sensitive and stochastic and the firm s objective is to maximize expected revenues examples that fit this framework include retailers selling fashion and seasonal goods and the travel and leisure industry which markets space such as seats on airline flights cabins on vacation cruises and rooms in hotels that become worthless if not sold by a specific time we formulate this problem using intensity control and obtain structural monotonicity results for the optimal intensity resp price as a function of the stock level and the length of the horizon for a particular exponential family of demand functions we find the optimal pricing policy in closed form for general demand functions we find an upper bound on the expected revenue based on analyzing the deterministic version of the problem and use this bound to prove that simple fixed price policies are asymptotically optimal as the volume of expected sales tends to infinity finally we extend our results to the case where demand is compound poisson only a finite number of prices is allowed the demand rate is time varying holding costs are incurred and cash flows are discounted the initial stock is a decision variable and reordering overbooking and random cancellations are allowed

women s property rights and gendered policies implications for women s long term welfare in rural tanzania this paper evaluates effects of community level women s property and inheritance rights on women s economic outcomes using a 13 year longitudinal panel from rural tanzania in the preferred model specification inverse probability weighting is applied to a woman level fixed effects model to control for individual level time invariant heterogeneity and attrition results indicate that changes in women s property and inheritance rights are significantly associated with women s employment outside the home self employment and earnings results are not limited to sub groups of marginalised women findings indicate lack of gender equity in sub saharan africa may inhibit economic development for women and society as a whole

new roles for marriage in urban africa kinship networks and the labor market in kenya abstract this paper explores new roles that traditionally rural kinship networks organized around the marriage institution might play in improving labor market outcomes in urban africa using new data from kisumu kenya and controlling for selection into marriage we find that marriage significantly increases employment levels and incomes in our sample of migrants at the same time marriage increases the remittances that migrants send to the extended family consistent with the view that the benefits of the network come with additional social obligations these obligations appear to be borne disproportionately by high ability individuals who consequently defer marriage the negative selection into marriage that we uncover has consequences for the future viability of the urban networks with implications for long term growth and distribution in this economy

winners and losers among a refugee hosting population abstractthe impact of a sudden mass influx of forced migrants on the hosting economy is understudied and not well understood using a household panel data set for the kagera region in tanzania we test the impact of the mass refugee presence on the welfare of the local population our identification strategy exploits variations in the timing of arrival as well as the spatial distribution of rwandese and burundi refugees we find a positive and aggregate effect but households are affected differently depending on their main initial occupation

women empowerment and economic development women empowerment and economic development are closely related in one direction development alone can play a major role in driving down inequality between men and women in the other direction empowering women may benefit development does this imply that pushing just one of these two levers would set a virtuous circle in motion this paper reviews the literature on both sides of the empowerment development nexus and argues that the interrelationships are probably too weak to be self sustaining and that continuous policy commitment to equality for its own sake may be needed to bring about equality between men and women

direct evidence on the marginal rate of taxation on dividend income abstract miller and scholes 1978 hypothesize that the marginal tax rate on dividend income may be less than the marginal rate of tax on capital gains their hypothesis is dependent upon individuals utilizing existing provisions of the code which serve to reduce the taxation of dividends in this study estimates of the marginal and effective rates of tax on dividend income for the year 1979 are presented using the statistics of income sample of returns the average marginal rate of tax on dividend income is estimated to be 40 while the average effective rate of tax is estimated to be 30

capital gains taxation and stock market activity evidence from ipos prior to the tax reform act of 1986 tra 86 long term capital gains were taxed at a lower rate than short term gains presenting investors with an opportunity to increase their after tax return by delaying the sale of appreciated assets until after they qualified for long term status and selling depreciated assets prior to long term qualification using a sample of initial public offerings i find that stocks that appreciated prior to long term qualification exhibit increased volume and decreased returns just after their qualification date while stocks that depreciated prior to long term qualification exhibit these effects just prior to their qualification date it is generally acknowledged that capital gains taxes influence investor behavior slemrod 1982 dyl 1979 chaplinsky and seyhun 1990 and others agree that individuals rationally respond to specific provisions of the tax code in attempting to reduce the tax liability of investment income recently this view has entered the public policy debate concerning the effective date of a proposed capital gains tax cut for example the wall street journal reported that congress has considered making proposed capital gains tax cuts retroactive to avoid possible market disruptions that might come from investors delaying transactions in anticipation of a future effective date wsj february 19 1997 despite the consensus view that capital gains taxes influence investment behavior specific distortions in behavior are difficult to document empirically one reason for the lack of evidence regarding the distortionary effect of capital gains taxes is that it is extremely difficult for researchers to determine the initial cost and the date of purchase of an asset without that information it is impossible for the investigator to know when an investor is trading a longterm or short term asset and whether he is realizing a gain or a loss one class of assets for which it is possible to obtain this information is initial public offerings of common stock ipos by definition ipos are not available for purchase prior to their offer date on the offer date shares are

relationships among three assumptions in revenue management this note discusses the relationships among three assumptions that appear frequently in the pricing revenue management literature these assumptions are mostly needed for analytical tractability and they have the common property of ensuring a well behaved revenue function the three assumptions are decreasing marginal revenue with respect to demand decreasing marginal revenue with respect to price and increasing price elasticity of demand we provide proofs and examples to show that none of these conditions implies any other however they can be ordered from strongest to weakest over restricted regions and the ordering depends upon the region

adult mortality and consumption growth in the age of hiv aids the authors use a 13 year panel of individuals in tanzania to assess how adult mortality shocks affect both short and long run consumption growth of surviving household members using unique data which tracks individuals from 1991 to 2004 they examine consumption growth controlling for a set of initial community household and individual characteristics the effect is identified using the sample of households in 2004 which grew out of baseline households the authors find robust evidence that an affected household will see consumption drop 7 percent within the first five years after the adult death with high growth in the sample over this time period this creates a 19 percentage point growth gap with the average household there is some evidence of persistent effects of these shocks for up to 13 years but these effects are imprecisely estimated and not significantly different from zero the impact of female adult death is found to be particularly severe

dividends and taxes evidence on tax reduction strategies this article investigates two aspects of dividend tax avoidance not addressed by prior research first it examines the aggregate dividend tax savings provided to individuals through tax exempt and tax deferred accumulators using the internal revenue service individual income tax model it then proceeds to determine whether specific provisions of the internal revenue code such as the preferential treatment of capital gains the investment interest limitation and the 100 dividend exclusion affect the individual s choice of investment income finally it provides a direct estimate of the average marginal tax rate on dividends that takes into account tax favored accumulators copyright 1990 by the university of chicago

temperature changes household consumption and internal migration evidence from tanzania large rural urban wage gaps observed in many developing countries are suggestive of barriers to migration that keep potential migrants in rural areas using long panel data spanning nearly two decades i study the extent to which migration rates are constrained by liquidity constraints in rural tanzania the analysis begins by quantifying the impact of weather variation on household welfare the results show how household consumption co moves with temperature rendering households vulnerable to local weather events these temperature induced income shocks are then found to inhibit long term migration among men thus preventing them from tapping into the opportunities brought about by geographical mobility

competing premarital investments this paper studies premarital parental investments in children s wealth where spousal wealth is a public good in marriage by investing in their children s wealth parents increase the wealth of their children and the quality of the spouses that their children can marry in large marriage markets the hedonic return to investment internalizes all the external benefits of premarital investment in wealth so that the competitive equilibrium is efficient marriage market competition also increases investments in small marriage markets relative to no competition but equilibrium investments are not efficient

dividends taxes and common stock prices the ex dividend day behavior of common stock prices before the income tax this study examines the ex dividend day behavior of common stock prices before the enactment of the federal income tax on ex dividend days during the pre tax period stock prices fell on average by the full amount of the dividend the data are consistent with the hypothesis that i investors in the pre tax period value dividends and capital gains as perfect substitutes and ii the differential taxation of dividends and capital gains has since caused investors to discount the value of taxable cash dividends in relation to capital gains

optimal pricing and production in an inventory model abstract this paper deals with the problem of simultaneously determining the optimal price policy and production rate over a given planning horizon for nonlinear demand functions and convex inventory and shortage cost functions the optimal solution paths are derived by using optimal control theory the treatment of linear nonsmooth cost functions requires the use of a generalized maximum principle the solution method is a phase portrait analysis providing insight into the optimal pricing and production policies as well as the resulting inventory paths moreover it is shown that in the case of nonsmooth piecewise linear cost functions the equilibrium is approached within finite time although the model is nonlinear in the control variables finally it is illustrated that exogenous fluctuations in the demand rate seasonal demand pattern amount to cyclical optimal solutions

periodic pricing of seasonal products in retailing this paper studies intertemporal pricing policies when selling seasonal products in retail stores we first present a continuous time model where a seller faces a stochastic arrival of customers with different valuations of the product for this model we characterize the optimal pricing policies as functions of time and inventory we use this model as a benchmark against which we compare more realistic models that consider periodic pricing reviews we show that the structure of the optimal pricing policies in this case is consistent with the procedures observed in practice retail stores successively discount the product during the season and promote a liquidation sale at the end of the planning horizon we also show that the loss experienced when implementing periodic pricing reviews instead of continuous policies is small when the appropriate number of reviews is chosen several interesting economic insights emerge from our analysis for example uncertainty in the demand for new products leads to higher prices larger discounts and more unsold inventory finally we study the effect of announced discount policies on prices and profits we show that stores that have adopted this type of strategy usually set prices such that with high probability the merchandise is sold during the first periods and the largest discounts rarely take place

dividend taxation in firm valuation new evidence in this paper we develop a residual income model showing how taxes on dividends affect the relative valuation of retained earnings versus contributed equity as well as the value of expected future earnings tests of predictions from our model for a sample of compustat firms from 197594 suggest that overall firm value and the relative valuation weights investors assign to retained earnings contributed equity and current earnings all critically depend on dividend taxes the findings also suggest that investors take a proprietary perspective in valuation and impute an unrecorded shareholder level tax liability on retained earnings the u s tax system subjects retained earnings to dividend taxes upon distribution to shareholders while contributed equity is returned to shareholders as a nontaxable return of capital from the shareholder s proprietary perspective therefore retained earnings should be valued on

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

descent rules and strategic transfers evidence from matrilineal groups in ghana abstract traditional descent systems can roughly be divided into patrilineal and matrilineal in the latter a man s heir is not his own child but rather his sister s son the paper examines the implications of this social norm for the pattern of inter vivos transfers using household level data from rural ghana where the largest ethnic group is traditionally matrilineal in particular it tests the predictions of a model of strategic behavior according to which children should respond to the threat of disinheritance by increasing transfers to their parents during lifetime to induce a donation of land before the default matrilineal inheritance is enforced i find that the credibility of customary norms enforcement as proxied by the presence of a nephew in the father s household significantly increases the probability of receiving transfers from children for akans but not for the other groups the effect is specific to nephews and not to other co resident boys this pattern of behavior can affect asset accumulation decisions across generations

female migration for marriage implications from the land reform in rural tanzania summary using the longitudinal household panel data drawn from rural tanzania 1991 2004 this study investigates impacts of the land reform on women s marriage motivated relocation during the period under study several villages that initially banned a widow s land inheritance abolished this discrimination taking a differences in differences approach this study finds that the probability of males marrying in a village increased by altering its customary land inheritance rule in favor of widows in the light of the traditional system favoring exogamous and patrilocal marriage this finding indicates that females relocate at marriage in response to the favorable land tenure system at the destination

land markets and land access among female headed households in northwestern tanzania summary land markets can potentially improve land access for female headed households if markets exhibit less restrictive gender norms around land ownership as compared with non market based systems of allocation at the same time land markets may not operate in a gender neutral manner with restrictions beyond the market continuing to influence the options of female headed households using both qualitative data and household survey data collected in 2014 and 2015 this paper explores the extent and manner in which female heads participate in the sales and rental markets in northwestern tanzania a qualitative analysis reveals that female heads do engage with the market although they find it most difficult to mobilize the necessary capital to participate as buyers or renters women also seem to face unique restrictions on selling land regression results show that female heads use the market to augment a small land endowment left from their marriage and this is particularly true for divorced or separated women however female headed households remain somewhat marginalized in terms of market participation our study shows that female heads in tanzania are far from sidelined in the land market though the rules of market engagement are decidedly nuanced

women as agents of change female income and mobility in india economic globalization will give many women in developing countries access to steady and relatively remunerative employment for the first time potentially shifting bargaining power within their households and changing the choices that are made for their children this paper exploits a unique setting a group of tea plantations in south india where women are employed in permanent wage labor and where incomes do not vary by caste to anticipate the impact of globalization on mobility across social groups in the future the main result of the paper is that a relative increase in female income weakens the family s ties to the ancestral community and the traditional economy but these mobility enhancing effects are obtained for certain historically disadvantaged castes alone although the paper provides a context specific explanation for why the women from these castes emerge as agents of change the first general implication of the analysis is that the incentive and the ability of women to use their earnings to influence household decisions depends importantly on their social background the second implication is that historically disadvantaged groups may in fact be especially responsive to new opportunities precisely because they have fewer ties to the traditional economy to hold them back

dividend taxation and household dividend portfolio decisions evidence from the u s jobs and growth tax relief reconciliation act of 2003 abstractthis study examines the dividend clientele hypothesis by focusing on the preferential tax treatment of qualified dividends provided by the 2003 jobs and growth tax relief reconciliation act jgtrra in the united states using the public use tax file data the author finds that the ratios of dividends to long term capital gains before the 2003 tax act significantly declined with household tax rate differentials between dividends and long term capital gains but such a negative tax effect on the ratios disappears afterwards this seemingly tax inefficient composition of dividends and long term capital gains after the tax act arises from households ability to reduce their tax burdens on stocks by exploiting the new preferential tax treatments on qualified dividends under jgtrra that is households in the upper tax bracket hold significantly greater shares of qualified dividends relative to ordinary dividends after the tax act

consumption smoothing migration and marriage evidence from rural india a significant proportion of migration in low income countries particularly in rural areas is composed of moves by women for the purpose of marriage we seek to explain these mobility patterns by examining marital arrangements among indian households in particular we hypothesize that the marriage of daughters to locationally distant dispersed yet kinship related households is a manifestation of implicit interhousehold contractual arrangements aimed at mitigating income risks and facilitating consumption smoothing in an environment characterized by information costs and spatially covariant risks analysis of longitudinal south indian village data lends support to the hypothesis marriage cum migration contributes significantly to a reduction in the variability of household food consumption farm households afflicted with more variable profits tend to engage in longer distance marriage cum migration the hypothesized and observed marriage cum migration patterns are in dissonance with standard models of marriage or migration that are concerned primarily with search costs and static income gains

reprint of migration and development research is moving far beyond remittances summary research on migration and development has recently changed in two ways first it has grown sharply in volume emerging as a proper subfield second while it once embraced principally rural urban migration and international remittances migration and development research has broadened to consider a range of international development processes these include human capital investment global diaspora networks circular or temporary migration and the transfer of technology and cultural norms for this special issue we present a selection of frontier migration and development research that instantiates these trends