rural wheat consumption in china the share of wheat in china s overall grain production and consumption has increased since economic reform china is also a large wheat importer but imports are erratic in the literature there is disagreement over future prospects for per capita wheat consumption in china and imports most of the wheat is consumed in rural areas where the majority of the population resides and where consumers have shifted from coarse grains and potatoes to wheat we analyze rural wheat consumption using household data from two provinces we find there is evidence to support a contention that china s per capita wheat consumption may not grow very fast in the future and could actually fall

law enforcement and transition abstract we present a simple model to analyze law enforcement problems in transition economies law enforcement implies coordination problems and multiplicity of equilibria due to a law abidance and a fiscal externality we analyze two institutional mechanisms for solving the coordination problem a first mechanism which we call dualism follows the scenario of chinese transition where the government keeps direct control over economic resources and where a liberalized non state sector follows market rules the second mechanism we put forward is accession to the european union we show that accession to the european union even without external borrowing provides a mechanism to eliminate the bad equilibrium provided the accessing country is small enough relative to the european union interestingly we show that accession without conditionality is better than with conditionality because conditionality creates a coordination problem of its own that partly annihilates the positive effects of expected accession

efficiency and equity in the producer levy of india india s producer levy scheme has been considered a prime example of government market intervention to depress price incentives for farm producers analysis in this study shows that the scheme increases the average producer price for the short run with inelastic supply in this case significant improvements in income distribution can be obtained with little loss of economic efficiency if the scheme is implemented effectively however if the scheme is applied for the long run it might result in market instability more critically the scheme is likely to have an adverse effect on income distribution in the absence of effective implementation

financial contracting under extreme uncertainty an analysis of brazilian corporate debentures abstract economic volatility high transaction costs and fragile institutions hinder financial contracting in emerging markets these conditions characterize the economy of brazil yet a nascent corporate bond market thrives i analyze 50 brazilian indenture agreements and find that sample debentures are characterized by i features that mitigate inflation risk for investors ii contingent maturity mechanisms that provide periodic opportunities for exit or renegotiation iii a paucity of covenants that restrict the debtor s investment financing and dividend decisions and iv self enforcement mechanisms that avoid reliance on inefficient institutions analysis of these features enhances our understanding of contracting in emerging economies

declining nutrient intake in a growing china does household heterogeneity matter summary this paper uses chinese household data for 1989 2009 to explain why mean nutrient intake has declined despite economic growth we focus on household heterogeneity in nutrient intake response to increases in household income allowing for its endogeneity a quantile instrumental variable fixed effects panel estimation shows that rising income tends to reduce inequality in macronutrient intake in both urban and rural areas in 2004 09 this is driven by increases in nutrient intake for the urban nutrient poor and falls in nutrient intake for the rural nutrient non poor on the other hand fluctuations in prices of meat eggs and oil increase nutrition poverty

technological change rediscovering the engine of productivity growth in china s rural economy abstract this paper focuses on measuring the relative importance of the role of technology versus that of institutional innovation in china s rural economy a six equation rice sector model explaining provincial level technology adoption yield and factor demand are econometrically estimated using data from china s 13 rice growing provinces for the period 1975 1990 growth decomposition analysis identifies technology adoption as the most important determinant of rice yield growth during 1978 1984 accounting for nearly 40 percent the change institutional reform accounted for 35 percent of the growth in 1985 1990 technology accounts for all of the increase in rice yields the study demonstrates earlier studies may have over estimated the impact of decollectivization

subsidy or market reform rethinking china s farm consolidation strategy chinese food security policy is anchored increasingly on the conviction that domestic grain production should be greatly enhanced and the best way to do so is to expand farm production scale to that end an increasing stream of public investment has been directed to the grain sector in the form for example of farm expansion subsidies our purpose is to assess the potential impacts of china s farm scale expansion on both yields and per hectare economic returns analysis of a large sample of farm household production data finds with some exceptions that grain yields likely will decline as farm size grows compromising food self sufficiency targets more importantly in only isolated cases would per hectare economic returns decline with size thus an emphasis on reducing farmland transactions costs may stimulate cropland consolidation and achieve the desired long term structural transformation

home bias in equity portfolios inflation hedging and international capital market equilibrium we test whether the home bias in equity portfolios is caused by investors trying to hedge inflation risk the empirical evidence is consistent with this motive only if investors have very high levels of risk tolerance and equity returns are negatively correlated with domestic inflation we then develop a model of international portfolio choice and equity market equilibrium that integrates inflation risk and deadweight costs using this model we estimate the levels of costs required to generate the observed home bias in portfolios consistent with different levels of risk aversion for a level of risk aversion consistent with standard estimates of the domestic equity market risk premium these costs are about a few percent per annum greater than observable costs such as withholding taxes thus the home bias cannot be explained by either inflation hedging or direct observable costs of international investment unless investors have very low levels of risk aversion article published by oxford university press on behalf of the society for financial studies in its journal the review of financial studies

the subsidization of farming households in china s agriculture concerned about national food self sufficiency and rural household incomes in 2004 china decided to reverse its longstanding policy of taxing farm households and instead began to provide them with subsidies since 2004 annual announcements have trumpeted rises in subsidies despite the historic turnaround of policy and likely implication of this subsidy policy to china s food economy there has been little household level survey based research that has sought to understand the nature of china s subsidy programs from the viewpoint of the farmer using data from two sets of household based surveys covering tens of thousands of households and most major producing provinces and survey data from government in this paper we examine the subsidies that are directly given to farmers one of the newest and relatively high profiles components of china s subsidy programs we focus on china s grain input seed and machinery subsidy programs according to the survey based findings we show that although agricultural subsidies per farm are low on a per hectare basis the rate of subsidies is high almost all producers are receiving them subsidies are mostly being given to the land contractor not the tiller most of grain input and seed subsidies are non distorting but machinery subsidy is based on farmers actual purchase of machineries

changes in trade and domestic distortions affecting china s agriculture this paper assesses the implications of china s trade and domestic policies for incentives to producers in china it uses a price comparison methodology nominal rates of assistance at the border and the farmgate with adjustments for exchange rate distortions in the first part of the sample period 1981 1994 on average distortions to agricultural incentives have been reduced in the early 1980s on average china s domestic prices were far below international prices there were substantial variations however between imported which were being protected and exported goods during the 1980s and 1990s the gap between domestic and international prices for both imports and exports narrowed initially mainly due to the elimination of domestic policy distortions between the mid 1990s and 2004 trade liberalization policy furthered narrowed the gap between world and china farmgate prices by the mid 2000s china s agriculture was operating with only small price distortions

the contracting benefits of accounting conservatism to lenders and borrowers abstract this paper examines the ex post and ex ante benefits of accounting conservatism to lenders and borrowers in the debt contracting process i expect conservatism to benefit lenders ex post through the timely signaling of default risk as manifested by accelerated covenant violations and to benefit borrowers ex ante through lower initial interest rates consistent with these predictions i find that more conservative borrowers are more likely to violate debt covenants following a negative price shock and that lenders offer lower interest rates to more conservative borrowers

effects of agricultural market policy on crop production in china this paper investigates the effects of chinese market policy on crop production in the reform process after a brief review of the policy changes due to the reform the theoretical significance of chinese market policies for crop production is demonstrated diagrammatically it is shown that under the current market system the production of main crops is significantly influenced by both market and quota prices while relatively high quota reduces the influence of market prices on production relative price changes between competing crops will lead to shifting farmers cultivation preferences if inputs are constant empirical analysis based on cross section data for the period 1985 1997 from the province of zhejiang confirms these hypotheses the effects of policy variables however prove to be crop specific if the potential of crop production in china is to be better used an even more market oriented agricultural policy is required

food security policy options for china lessons from other countries the authors gratefully acknowledge financial support from the world bank and australia s rural industries research and development corporation

productivity net returns and efficiency land and market reform in vietnamese rice production extensive land and market reform in vietnam has resulted in dramatic increases in rice output over the past thirty years the land and market reforms in agriculture were pervasive moving the system of rice production from commune based public ownership and control to one with effective private property rights over land and farm assets competitive domestic markets and individual decision making over a wide range of agricultural activities the effect of this reform period and beyond is detailed with measures of total factor productivity tfp terms of trade and net returns in rice production in vietnam from 1985 to 2006 results show that tfp rises considerably in the major rice growing areas the mekong and red river delta areas during the early years of reform and beyond but also that there is clear evidence of a productivity slow down since 2000 the differences over time and by region speak directly to existing land use regulations and practices suggesting calls for further land and market reform to illustrate this additional frontier and efficiency model estimates detail the effects of remaining institutional and policy constraints including existing restrictions on land consolidation and conversion and poorly developed markets for land and capital estimates show that larger and less land fragmented farms farms in the major rice growing areas and those farms that are better irrigated have a greater proportion of capital per unit of cultivated land a clear property right or land use certificate and access to agricultural extension services are more efficient

structural change in the impact of income on food consumption in china 1989 1993 china is undergoing a marked transition in its diet and nutritional status patterns this study determines the structural change in the impact of income on food consumption in china during 1989 93 utilizing data from a longitudinal study of 3800 households in china evidence points to a shift in the relationship between income dietary structure and total nutrient intake at the macrolevel overall it is noted that the increase in income over time in the country coincided with a shift in the demand for inferior and normal food groups in addition there was a pronounced increase in the income elasticity for more luxury foods during the specified period while less superior goods became more inferior over this 4 year span such an increase in income elasticities for total energy and for energy from fat suggest a worsening of the composition of the diet in ways that are linked to obesity and obesity related diseases as incomes continue to rise in view of this several implications for the formulation of future nutrition policies in china are cited

optimal strategies for a three level contract farming supply chain with subsidy abstract we consider a three level contract farming supply chain with a risk averse farmer a risk neutral supplier and a risk neutral distributor in which the farmer faces a yield uncertainty and the government offers agricultural subsidy to the farmer the cvar criterion is used to describe the risk averse behavior of the farmer we derive the optimal strategies of the supply chain and perform some sensitivity analysis to investigate the effects of the government subsidy and other factors the results indicate that as the subsidy increases the farmer s total target production increases further analysis shows that the total production increase is mainly from the increased farm size and the farmer s endeavor actually decreases in addition the results indicate that the profits of the supplier and the distributor both increase with respect to the subsidy however the impact of the subsidy on the farmer s profit depends on the farmer s degree of risk averse in particular the impact of the subsidy to the farmer s profit tends to be positive for farmers with high degree of risk averse and the impact tends to be negative for those with low degree of risk averse the sensitivity analysis is also performed for the level of yield uncertainty in term of the standard deviation

lobbying and agricultural trade policy in the united states the authors study whether political campaign contributions influence agricultural protection in the united states in the manner suggested by the political economy model of grossman and helpman 1994 this is the first attempt to test this model using agricultural data the authors test the model using a detailed cross sectional data set of agricultural protection subsidies and political action committee pac contributions in the late 1990s the model is qualitatively affirmed by the data they make a novel attempt to solve a puzzle about the model s quantitative implications also found in recent studies this solution makes the simple model consistent with the complicated decisionmaking process in real world government the results imply the underpinnings of a political economy equilibrium that will be hard to dislodge

reform without losers an interpretation of china s dual track approach to transition this paper develops a simple model to analyze the dual track approach to market liberalization as a mechanism for implementing efficient pareto improving economic reform that is reform achieving efficiency without creating losers the approach based on the continued enforcement of the existing plan while simultaneously liberalizing the market can be understood as a method for making implicit lump sum transfers to compensate potential losers of the reform the model highlights the critical roles of enforcement of the plan for achieving pareto improvement and full liberalization of the market track for achieving efficiency we examine how the dual track approach has worked in product and labor market liberalization in china

china s food economy to the twenty first century supply demand and trade this paper accounts for the structural changes now taking place in china and suggests that china is not likely to become either an enormous importer or exporter of grain ultimately though china s grain balances will depend on decisions made by chinese policymakers rather than natural resource constraints p v this abstract was borrowed from another version of this item

discussion of financial globalization governance and the evolution of home bias kets generally referred to as home bias is a well established empirical reg ularity french and poterba 1991 cooper and kaplanis 1994 tesar and werner 1995 lewis 1999 and many others the original findings have been replicated across a wide spectrum of countries and investor types var ious explanations have been examined over the years beginning with trans action costs and frictions then moving into informational costs kang and stulz 1997 suh 2001 ahearne griever and warnock 2004 doidge karolyi and stulz 2004 despite this long and persistent history of empir ical investigation the literature in the area has difficulty providing a robust explanation for this pervasive phenomenon financial globalization governance and the evolution of home bias by kho stulz and warnock 2008 henceforth ksw provides a potential explanation for the home bias and investigates that explanation with tests based on two different data sets they suggest that the observed home bias is a result of an optimal corporate ownership theory where firms in poor governance countries are heavily owned by insiders or large shareholders with the ability to monitor both types of shareholdings reduce the float

cross subsidization due to inframarginal support in agriculture a general theory and empirical evidence a general theory of cross subsidization due to inframarginal support is developed two sources of output distortion are identified exit deterrence and extramarginal output some firms would not be in business without the subsidy cost savings due to declining average costs are always greater than the losses incurred where price equals marginal cost moreover it is theoretically possible for inframarginal subsidies to expand output more than equivalent fully coupled subsidies empirical analysis of u s dairy subsidies isolates these components of cross subsidization and finds distortions from inframarginal support to be substantial with implications for trade negotiations dispute settlement and policy formulation copyright 2008 oxford university press

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

what drives china s new agricultural subsidies summary china s agricultural policy has undergone a fundamental transformation in the four decades since the introduction of market reforms in 1978 and now involves a wide array of policy instruments that range from output and input subsidies to public infrastructure expenditures this article analyzes the political economic determinants of china s agricultural subsidy changes using producer subsidy equivalents pses drawn from annual data from 1984 to 2015 on 16 agricultural commodity sectors that include multiple policy instruments empirical results indicate that national factors such as high rates of economic growth and a lower share of agriculture in the economy have been the primary drivers of increases in pses and that larger more geographically concentrated agricultural sectors are more likely to be subsidized at a higher pse rate finally china s joining the world trade organization in december 2001 led to significant increases in pses that were not already explained by internal national or commodity specific factors in essence china s agricultural subsidy programs and levels increasingly resemble those of developed countries primarily as a result of economic transformation and the ability to structure agricultural policies within the wto rules moreover this article predicts that agricultural subsidies will trend slightly upward in the next decade and that the strongest opportunities to export to china will be in animal products or grains that are utilized for feed or processed foods where the levels of subsidies are predicted to increase but remain lower than for traditional food crops

plan and market in china s agricultural commerce this article examines interactions between markets and state commercial planning in the context of china s agricultural sector it begins with a discussion of recent trends in agricultural planning and commerce in china and then presents a theoretical model that analyzes the way that a mixed commercial system of the sort observed in china functions the theoretical analysis suggests that a mixed system is sustainable and can have desirable efficiency and distributional effects markets however limit the range of sustainable plans and in the presence of markets state planning may no longer directly influence production and consumption behavior

institutional differences and international private debt markets a test using mandatory ifrs adoption institutional differences between countries result in additional information risks between borrowers and lenders in cross border private loans this study examines the effect of these information risks on the structure of optimal debt contracts in international cross border versus domestic private debt markets using mandatory ifrs adoption as an indicator for institutional changes that reduced differences between countries i compare attributes of international versus domestic loans before and after ifrs adoption i find that in the pre ifrs period international loans are associated with a higher credit spread a weaker relationship between the bank and the borrower a more diffuse loan syndicate and less reliance on accounting based covenants than domestic loans these results are consistent with incremental information risks in international debt markets that make it more costly for lenders to screen and monitor borrower credit quality resulting in a more arm s length relationship between borrowers and lenders many of these associations attenuate after ifrs adoption suggesting that the pre ifrs differences in contract terms are driven by incremental information risks related to institutional differences between countries my findings imply that incremental information risks result in a different optimal contract in international debt contracts compared to domestic debt contracts

performance pricing in bank debt contracts abstract performance pricing links bank debt interest rate spreads to a borrower s performance via two options interest decreasing performance pricing reduces spreads if credit quality improves it is more common when prepayment is more likely or costly and when adverse selection costs are higher and is less common when multiple performance measures better predict credit quality interest increasing performance pricing increases spreads if credit quality deteriorates it is more common when lenders reduce interest rates to add this provision when downgrades are more likely and when moral hazard costs are higher we find lower spreads for contracts with interest increasing performance pricing

marketing reforms market development and agricultural production in china abstract chinese agricultural reforms have consisted of two transitional stages initially decollectivization in the late 1970s followed by market liberalization in the mid 1980s while much research has been conducted on the initial stage of increasing the incentives for farmers in collective cultivation little quantitative evidence exists on how marketing reforms and the development of rural markets has affected agricultural production decisions using more accurate and disaggregated measures of the reform and market development components of liberalization than previous research this study examined the effects of these liberalization policies on the agricultural production decisions in shaanxi province procurement quota levels were found to be positively associated with the area planted to grain crops thus quotas represent an effective way of increasing grain production and thereby also a means of achieving food self sufficiency which remains an important policy objective for the chinese government the involvement of state grain stations in free market grain trade and the expansion of rural markets has increased the area planted to the two potential cash crops soybeans and wheat and reduced the sown area of the subsistence crop corn reflecting the reduced need to plant corn as a self insurance mechanism for smoothing consumption an increase in procurement quotas increases fertilizer use on grain crops due to the policy of linking quotas to access to below market priced fertilizer but decreases the use of labor which shifts to other more profitable enterprises market development has increased these off farm employment opportunities and the earnings associated with them thereby promoting the shift of labor out of crop production and increased the use of fertilizer which has also become more available

distributional consequences of rural food levy and subsidized urban rations abstract governments in many developing countries have imposed food levies on farmers to provide subsidized food to urban consumers the resulting price discrimination between individuals has general equilibrium effects so that the welfare consequences of such a policy for different socio economic groups have been controversial we relate the distributional consequences to the parameters of the economy and identify systematic relationships among different partitions of the outcomes we show for instance that if the policy helps hurts richer city dwellers then it hurts helps poorer farmers

poverty reduction through land transfers the world bank s titling reforms and the making of subsistence agriculture abstract the world bank emphasizes land reform as a key pro poor intervention expecting the transfer of land to the rural poor to trigger a straight transition from poverty and subsistence to entrepreneurial and commercial smallholder farming this article asks how and why world bank prescriptions change in response to developments on the ground that contradict initial expectations to show that the transition to commercialization is hardly a straight one as it involves contradictory elements it builds on an analysis of close to twenty years of world bank reports on land reform in four post communist countries to show how and why the transfer of land and commercialization end up contradicting rather than mutually supporting each other the analysis shows that as a result of this contradiction wb inspired policies prioritize commercialization over poverty reduction and their underlying understanding of poverty has changed from poverty as lack of farmland to poverty as lack of alternatives to farming for the world bank the problem in these countries is not so much the failure of having pro poor results but the decreasing control over smallholders perceived to have responded to insufficient reforms by withdrawing from markets into subsistence yet the analysis further suggests that even though presently seen as a sign of underdevelopment the subsistence capacity of local populations following land transfers was in earlier reports encouraged as it was believed to have the effect of supporting the commercialization of the sector and relieving welfare systems this aspect of reforms is now relatively rarely mentioned and subsistence is assumed to be an effect of anything but reforms cast instead as a sign of insufficient market creation

rawlsian justice as the core of a game it is suggested that the ethical notion of social contract can be formally modeled using the well studied concept of the core of a game this provides a mathematical technique for studying social contracts and theories of justice the idea is applied to rawlsian justice here this abstract was borrowed from another version of this item

estimating distortions in the chinese economy a general equilibrium approach a computable general equilibrium model is constructed to simulate the chinese economy under a system of free markets and is estimated using a calibration procedure coupled with econometric estimation for key parameters the equilibrium solution of the model indicates substantial distortions in prices and resource allocation in the 1983 chinese economy labour was found to be overpaid and capital underpaid in most non agricultural sectors two fifths of the agricultural labour force would have been employed by the non agricultural sectors had china been a market economy the elimination of these distortions would imply a significant improvement in allocative efficiency and a redistribution of income from labour to capital from households to the state and from urban to rural households china embarked upon its economic reform programme in the late 1970s over the period 1979 83 there were dramatic reforms in the rural agricultural sector including the dismantling of the three level ownership of communes the dis tribution of land to peasant households and the relaxation of controls over labour transfer from the agricultural sector to the rural non agricultural sector in contrast in the urban economy and especially in the state industrial sector reforms were confined to modest improvements in incentives for enterprises and workers notably through the introduction of profit retention schemes and bonus systems in 1983 much of the traditional mechanism of resource alloca tion remained essentially intact the problem of distortions in the price system and in resource allocation in centrally planned economies cpes has long been a concern of economists and there has been a considerable interest in empirical modelling of distortions in cpes thornton 1971 estimated potential efficiency gains from equalizing the return to capital for different branches of soviet industry in the early 1960s desai and martin 1983 provided similar estimates using econometrically esti mated production functions portes and winter 1980 estimated excess demand in the aggregated consumption goods market for a number of pre reform eastern european economies using the technique of econometric dis equilibrium modelling podkamine 1988 calculated free market demands and prices in the absence of rationing for consumption goods markets in poland during 1965 86 by transplanting demand systems estimated for market econ omies into the quantity constrained polish economy chow 1985 investigated the efficiency of labour allocation in chinese state industry by comparing the average wage rate with the value of the marginal product of labour all these studies however involve partial equilibrium analysis in the sense that they are concerned only with examining the distortion in a specific market and therefore have tended to ignore distortions in the rest of the economy and a

a transitional institution for the emerging land market in urban china chinese economic reforms since 1978 have been a continuous process of fundamental institutional change the new institution of ambiguous property rights over state owned urban land evolves from the

quantifying the structure of food demand in china an econometric approach this article examines food demand structure and its dynamics for 11 commodities in urban china the analysis is based on household level expenditure survey data for two cross sectional surveys of chinese households pertaining to food expenditure patterns during 1995 and 2003 pre committed components of commodity demands that are insensitive to economic variables are explored we use the generalized quadratic almost ideal demand system gqaids for its empirical superiority to the generalized almost ideal demand system gaids and estimate the associated parameters via full information maximum likelihood procedure fiml accounting for endogeneity of total expenditures on food for home consumption fah we also use quality adjusted commodity unit values to control for quality differences resulting from commodity aggregation and food choice furthermore we derive gqaids elasticity formulas and estimate income elasticities without restrictions the results partially support the hypothesis that an average chinese household has incorporated elements of western diet fine grains into traditional chinese food diet over time moreover the outcome of a simple test developed here points to possible preference changes for a majority of food staples under study

grain policy in chinese villages yield response to pricing procurement and loan policies this paper assesses the effects of pricing procurement and loan policies on china s grain economy a dynamic control model of the village leader is specified parameters of structural and control equations are estimated using time series cross section data simulation results show that pricing and procurement policies are not effective in raising yields because of conflicting objectives of local officials loan policies can increase yields the paper concludes that rural policies often have contradictory effects that can arise for a number of reasons an important reason is the fact that local officials in a reforming economy have greater decision making discretion than higher level officials and execute policies to meet their own objectives

redistribution tax under non benevolent governments i analyze redistribution policies of majority governments in one kind of representative voting system i employ these assumptions members gain special benefits in the majority parties act strategically by using redistribution transfers the member s utility function is given in a quasi linear function the government s objective functions are the weighted summation of utilities and i classify governments according to the weight the four main results are a stable majority dose not support myopic government the stable redistribution policy of benevolent government is expressed by a scope of transfers the stable transfer of non benevolent governments depends on private utilities of the majority and opportunity costs of the minority and the altruistic government is not displayed by any other majority because it offers the total welfare of the majority to the minority as a subsidy

investor protection and corporate governance recent research has documented large differences among countries in ownership concentration in publicly traded firms in the breadth and depth of capital markets in dividend policies and in the access of firms to external finance a common element to the explanations of these differences is how well investors both shareholders and creditors are protected by law from expropriation by the managers and controlling shareholders of firms we describe the differences in laws and the effectiveness of their enforcement across countries discuss the possible origins of these differences summarize their consequences and assess potential strategies of corporate governance reform we argue that the legal approach is a more fruitful way to understand corporate governance and its reform than the conventional distinction between bank centered and market centered financial systems

negotiated measurement rules in debt contracts this paper investigates contractual definitions of net income and net worth and the cross sectional variation in definitions of net income in a large sample of private debt contracts to shed light on the debt contracting demand for accounting numbers the descriptive evidence indicates that removing transitory earnings is one principal concern in the measurement of earnings but not in the measurement of net worth in the extreme contracts are never written on comprehensive income as an earnings concept whereas accumulated other comprehensive income is included in net worth in most contracts in contrast conservative adjustment in the sense of including certain types of negative earnings but not the corresponding positive earnings does not seem to be a primary consideration in measuring net income and net worth cross sectionally i find that net income is more likely to be defined differently from the gaap when net income plays a more important role in a contract when the loan maturity is longer and when transitory earnings are less useful for debt contracting collectively the evidence shows that debt contracting parties choose contracting variables in a manner consistent with efficient contracting and that transitory earnings are relatively less useful in measuring firm performance for debt contracting

the impact of natural disasters on household income expenditure poverty and inequality evidence from vietnam natural disasters are expected exacerbate poverty and inequality but little evidence exists to support the impact at household level this article examines the effect of natural disasters on household income expenditure poverty and inequality using the vietnam household living standard survey in 2008 the effects of a natural disaster on household income and expenditure corrected for fixed effects and potential endogeneity bias are estimated at 6 9 and 7 1 declines in vietnamese household per capita income and expenditure respectively natural disasters demonstrably worsen expenditure poverty and inequality in vietnam and thus should be considered as a factor in designing poverty alleviation policies

the macroeconomic consequences of disasters abstract natural disasters have a statistically observable adverse impact on the macro economy in the short run and costlier events lead to more pronounced slowdowns in production yet interestingly developing countries and smaller economies face much larger output declines following a disaster of similar relative magnitude than do developed countries or bigger economies a close study of the determinants of these adverse macroeconomic output costs reveals several interesting patterns countries with a higher literacy rate better institutions higher per capita income higher degree of openness to trade and higher levels of government spending are better able to withstand the initial disaster shock and prevent further spillovers into the macro economy these all suggest an increased ability to mobilize resources for reconstruction financial conditions also seem to be of importance countries with more foreign exchange reserves and higher levels of domestic credit but with less open capital accounts appear more robust and better able to endure natural disasters with less adverse spillover into domestic production

oil price shocks and policy responses in the post reform chinese economy this study analyses the impact of the 1986 oil price shock on china and the policy options for accommodating the shock a computable general equilibrium model is used to capture the complex interactions in the chinese economy in response to the shock interpreted in the theoretical framework of the booming sector model the results of the model provide insights on both the real and monetary effects of the shock and suggest that a combination of policy instruments such as a cut in real absorption depreciation of the official exchange rate and tight monetary control are required to facilitate adjustment

an option perspective on generating and maintaining plant variety rights in china notwithstanding the ambiguous research and productivity promoting effects of plant variety protections pvps even in developed countries many developing countries have adopted pvps in the past few years in part to comply with their trade related aspects of intellectual property rights trips obligations seeking and maintaining pvps reserves options to an expected revenue stream from the future sale of protected varieties the value of which varies for a host of reasons in this article we empirically examine the pattern of pvp applications in china since its pvp laws were first introduced in 1997 we place those pvp rights in the context of china s present and likely future seed markets to identify the economic incentives and institutional influences on decisions to develop and apply for varietal rights

impact of eliminating government interventions on china s rice sector abstract china s economy has undergone fundamental changes since 1978 agriculture industry and services are being transformed into market economies marketing and domestic trade have also been reformed to take into account regional comparative advantages the government however still controls input supply and output procurement to some extent china is currently negotiating with the gatt in regard to gaining membership conditions for china s reentering the gatt are to eliminate the government interventions on domestic production and consumption and international trade this may affect china s comparative advantages in international markets and therefore may result in changes in the structure of imports and exports will china continue to export rice or will it start to import rice under free trade and if china continues to export how much will china export this paper attempts to model the potential effects of eliminating all government interventions on china s rice sector we construct a rice industry model to facilitate our analysis the model has three components i e supply demand and price linkages the estimated results are consistent with theory and are evaluated using several techniques results from model validation indicate that both static and dynamic models are reasonable and can be used to simulate effects of various government policies simulations are conducted to project china s rice economy to the year 2000 two scenarios are compared 1 continued current policy and 2 elimination of all government interventions eliminating all government interventions would increase production stocks and exports domestic consumption would decline due to the higher domestic prices from eliminating government subsidies on rice consumption china would export more than 1 6 million metric tonnes of milled rice if there were no government interventions in the year 2000

collectivization and china s agricultural crisis in 1959 1961 the agricultural crisis in china in 1959 61 after the initial success of the collectivization movement resulted in 30 million extra deaths in this paper a game theory hypothesis proposes the main cause of this catastrophe i argue that because of the difficulty in supervising agricultural work the success of an agricultural collective depends on a self enforcing contract in which each one promises to discipline oneself a self enforcing contract however can be sustained only in a repeated game in the fall of 1958 the right to withdraw from a collective was deprived the nature of the collectivization was thus changed from a repeated game to a one time game as a result the self enforcing contract could not be sustained and agricultural productivity collapsed the empirical evidence is consistent with this hypothesis

food demand in rural china evidence from rural household survey abstract the recent rural reforms in china have had great effects on agricultural production and productivity as well as rural household consumption while much has been written on production and productivity effects of these reforms very few chinese studies have attempted to analyze the changes in rural consumption patterns this paper uses a dynamic aids model to estimate various food demand parameters for chinese rural households using rural household survey data recently released by the china state statistical bureau the results show that all important food commodities including rice wheat coarse grains vegetables meat tobacco and alcohol have positive expenditure elasticities rice wheat and coarse grains are necessities while meat vegetables alcohol and tobacco are luxuries the expenditure elasticities for rice coarse grains and tobacco are declining but those for wheat meat vegetables and alcohol are increasing as per capita income rises and population increases the demand for these items will continue to increase therefore china must continue to increase its food production by a greater rate in the future in order to avoid food shortages

success and failure of reform insights from the transition of agriculture this paper analyzes the linkages between the reform strategies in transition countries and economic performance the authors focus on agriculture because of the sharpness of the policy changes fundamental differences among countries and relative simplicity of agricultural relationships the authors document post reform performance in the transition countries of asia and europe the authors show how a pricing reform and subsidy reductions b land rights reform and policies that affect farm restructuring and c the presence institutions that facilitate exchange either markets or market substitutes affect output and productivity the paper ends with general lessons on reforms and transition

structure of agricultural protection in industrial countries abstract the nominal rates of agricultural protection in ten industrial countries from 1955 to 1980 are estimated with the same commodity coverage and data definitions a regression analysis is conducted to explain variations in the measured level of agricultural protection in terms of political as well as economic factors nearly 80 percent of the variations is accounted for by differences in agriculture s comparative advantage agriculture s share in total economy the international terms of trade between agricultural and manufactured commodities regionalism eec and food security consideration associated with non military alliance

china s nutrient availability and sources 1950 1991 abstract the rapid changes in china s economy and data availability have led to the need for a quantitative assessment of its food and nutrient situation this paper first reports estimates of china s average per capita daily energy protein and fat availability through yearly food balance sheets for the period 1950 1991 then policy impacts on the nutrient changes are examined results suggest that china s nutritional status has improved significantly over the period especially since the 1978 economic reforms government policy has been a key factor influencing the nutrient changes since 1950 and will continue to play an important role in china s nutritional improvement

food prices and the efficiency of public intervention the case of the public distribution system in india abstract as public intervention is a pervasive influence on food prices this paper asks whether and how the inefficiency of state institutions matters to food prices in the context of the wheat subsidy scheme in india the paper models the implications of quality differences between public and private grain supply as both are procured at similar prices the lower quality of public grain marks the inefficiency of government operations the paper proposes and empirically validates a method to test for demand switches that occur as a result of quality preference as a result a reduction in food subsidies increases food prices and hurts the poor even when they are not major recipients of the subsidy this seeming paradox is contingent on the inefficiency of public interventions thus the outcome will be different if the reduction in food subsidy were to be accompanied by reforms in the associated state agencies

evaluating the impact of tax for fee reform fei gai shui on water resources and agriculture production in the zhanghe irrigation system china this article questions the effectiveness and viability of rural tax for fee reform fei gai shui on water resources and agriculture production taking the zhanghe irrigation system of china as a case study example the fei gai shui reform has been heralded as a possible solution for reducing the excessive fiscal burden on peasants while the reform may achieve in relieving peasant burdens significantly the initial impact of fei gai shui on water resources and agricultural production indicate least satisfactory trends the policy shows significant impact on rice yield and area it might also have profound impact on cropping pattern but it has yet to be seen dependence on local water resources such as ponds show significant increase after fei gai shui as it discouraged farmers to rely on regional water sources although the lower regional water use under fei gai shui reduced the water charges paid by farmers the savings were mostly offset by increasing pumping costs in accessing water from local ponds without any adjustments the fei gai shui is likely to cause serious predicament in agricultural sector it is visioned that local water resources such as water ponds will continue to play an important role in sustaining agricultural production

political institutions and international patterns of agricultural protection this paper analyzes the influence of political systems and rights in patterns of agricultural protection across commodities countries and over time four political systems and a qualitative index of political rights account for differences in political institutions the analysis incorporates the effects of development of constraints on tax collection feasibility and of comparative advantages and terms of trade pluralistic systems are associated with higher agricultural protection levels although in a nonlinear fashion access to pluralism appears to be important although further democratization partly dissipates protection copyright 1994 by mit press

giffen behavior and subsistence consumption this paper provides the first real world evidence of giffen behavior i e upward sloping demand subsidizing the prices of dietary staples for extremely poor households in two provinces of china we find strong evidence of giffen behavior for rice in hunan and weaker evidence for wheat in gansu the data provide new insight into the consumption behavior of the poor who act as though maximizing utility subject to subsistence concerns we find that their elasticity of demand depends significantly and nonlinearly on the severity of their poverty understanding this heterogeneity is important for the effective design of welfare programs for the poor jel d12 012

reconciling chinese meat production and consumption data with more than one fifth of the world s population and only 7 of the world s arable land china has the potential to become a major importer of land intensive products such as feed grains this development would be of particular interest to the united states and canada which together have more than 17 of the world s arable land but only 5 of the world s population 1 per capita private consumption in china has been increasing at an average annual rate of 6 8 over the past decade given the low average income level in china consumption of feedgrain intensive products such as meat dairy products and alcohol can be expected to increase with continued income growth these factors take on greater significance given the fact that china has applied to join the world trade organization and trade liberalization may soon occur use of grain intensive products should increase if china liberalizes its agricultural markets and china should eventually reverse the current trade situation and begin to import large quantities of feed grains and meats the combination of these observations has stimulated interest in china s agricultural data and the research and policy prescriptions based on these data are greatly affected by the data s quality to understand why this is important consider the following examples official chinese and u s data show that per capita pork consumption in china is about 5 kilograms per person greater than it is in the united states 2 if this is true then it might be argued that chinese pork consumption is reaching a saturation level alternatively one might argue that the enormous increase in per capita pork consumption in the past several years implies a large expenditure elasticity any attempt to use this expenditure elasticity for projection of future meat demand in conjunction with strong growth in projected per capita income would imply a large percentage increase in consumption from a base that is already very high because feed grain consumption is directly dependent on livestock

accounting standards and debt covenants has the balance sheet approach led to a decline in the use of balance sheet covenants abstract recent years have seen a sharp decline in the use of balance sheet based covenants in private debt contracts i hypothesize that changes in accounting standards can explain part of this decline standard setting has shifted towards a balance sheet approach which i predict has made the balance sheet less useful for contracting i measure the effect of the balance sheet approach on specific borrowers using a volatility ratio i find that borrowers with greater volatility ratios are less likely to have balance sheet based covenants this evidence is consistent with reductions in the contracting usefulness of the balance sheet being associated with reductions in balance sheet covenants

the benefits of lending relationships evidence from small business data this paper empirically examines how ties between a firm and its creditors affect the availability and cost of funds to the firm we analyze data collected in a survey of small firms by the small business administration the primary benefit of building close ties with an institutional creditor is that the availability of financing increases we find smaller effects on the price of credit attempts to widen the circle of relationships by borrowing from multiple lenders increases the price and reduces the availability of credit in sum relationships are valuable and appear to operate more through quantities rather than prices

economic justice and economic power an inquiry into distributive justice and political stability we characterize and study the relationship between income redistributions that are just and stable we assume that for a given economy there exists a set of possible income redistributions the constitution of the economy the choice of redistribution is in the hands of the agents who decide by majority vote a stable redistribution is one that majority vote cannot alter when each agent tries to maximize his income

control in a dynamic village economy the reforms and unbalanced development in china s rural economy abstract a dynamic control framework is used to model the chinese village economy in order to explain the rural sector s unbalanced growth in the post reform period village leaders are assumed to maximize a multi attribute utility function by manipulating local policy instruments subject to the structural relationships in the economy the model s parameters are estimated econometrically using a data set from forty villages in eastern china the empirical results identify important linkages between agriculture and rural industry in village economies unbalanced growth can partially be explained by the way economic incentives induce individuals in rural areas to move resources toward the rural industrial sector and away from agriculture

the impacts of india s food security policies on south asian wheat and rice markets we quantify the extent to which india s success in stabilizing its wheat and rice markets affects other countries in south asia we deal with the variability of indian trade and price policies by a

rural taxation and government regulation in china this paper places the problem of chinese rural taxation in the context of government regulation and seeks to present an integrated theoretical framework of chinese rural development in the past two decades our theoretical framework reconciles the seemingly contradictory facts that the average level of rural taxation relative to rural net income did not increase quickly from 1990 but rural taxation became a very serious problem in this period our findings suggest that this is in large part due to increases in rural income disparity from 1990 and uneven tax distribution among different income groups we argue that differentiated enforcement of government regulations such as grain procurement and birth control play an important role in the rural taxation problem and more generally the problem of local government expansion and rising rural income disparity the empirical findings support our hypotheses

the importance of accounting changes in debt contracts the cost of flexibility in covenant calculations abstract in this paper we examine how the exclusion of voluntary and mandatory accounting changes from the calculation of covenant compliance affects the interest rate charged on the loan after controlling for self selection bias and other factors known to affect loan spreads we find that the rate charged is 84 basis points lower when voluntary accounting changes are excluded and 71 basis points lower when mandatory accounting changes are excluded our results suggest that borrowers are willing to pay substantially higher interest rates to retain accounting flexibility that may help them avoid covenant violations and to avoid duplicate record keeping costs

developmental drivers of nutritional change a cross country analysis summary we utilize a rich cross country data set to understand within country changes in nutrition with a focus on the role of general developmental factors we find that economic growth is a strong predictor of nutritional performance as is growth in food production although only in more food insecure countries we find no evidence that infrastructure is directly important but greater asset ownership improved access to health services higher rates of female secondary education and lower fertility rates are all strong predictors of improvements in nutrition we show that national success stories are largely consistent with these findings

missing women and the price of tea in china the effect of sex specific earnings on sex imbalance economists have long argued that the sex imbalance in developing countries is caused by underlying economic conditions this paper uses exogenous increases in sex specific agricultural income caused by post mao reforms in china to estimate the effects of total income and sex specific income on sex differential survival of children increasing female income holding male income constant improves survival rates for girls whereas increasing male income holding female income constant worsens survival rates for girls increasing female income increases educational attainment of all children whereas increasing male income decreases educational attainment for girls and has no effect on boys educational attainment