blessing or curse impacts of the brazilian pre salt oil exploration abstract the discoveries of oil and gas in the so called pre salt layer have triggered a lot of discussions about their economic effect in this paper we discuss in detail a less discussed dimension the impact of pre salt layer in the structure of the brazilian economy especially the composition of the industry and exports similar consequences in the country of dutch disease and deindustrialization due to revenues from oil exports are evaluated the methodology used is a dynamic global general equilibrium model with specific features for the treatment of the issues raised

micro data heterogeneity and the evaluation of public policy nobel lecture this paper summarizes the contributions of microeconometrics to economic knowledge four main themes are developed 1 microeconometricians developed new tools to respond to econometric problems raised by the analysis of the new sources of micro data produced after the second world war 2 microeconometrics improved on aggregate time series methods by building models that linked economic models for individuals to data on individual behavior 3 an important empirical regularity detected by the field is the diversity and heterogeneity of behavior this heterogeneity has profound consequences for economic theory and for econometric practice 4 microeconometrics has contributed substantially to the scientific evaluation of public policy

equilibrium valuation of natural resources the purpose of this paper is to provide a theoretical investigation of equilibrium spot and futures price behavior in a nonrenewable commodity market the underlying commodity is nonrenewable in the sense that the reserve level of the commodity is expected to decline over time in the absence of successful discoveries of additional reserves i wish to understand how the nonrenewable nature of the commodity influences the intertemporal extraction of the commodity equilibrium spot price behavior and the prices of derivative assets traded on the nonrenewable commodity there is considerable disagreement among economists whether resources are exhaustible in the sense of resource constraints becoming binding on our society in the foreseeable future some economists have argued that natural resources are being depleted at

stochastic convenience yield and the pricing of oil contingent claims this paper develops and empirically tests a two factor model for pricing financial and real assets contingent on the price of oil the factors are the spot price of oil and the instantaneous convenience yield the parameters of the model are estimated using weekly oil futures contract prices from january 1984 to november 1988 and the model s performance is assessed out of sample by valuing futures contracts over the period november 1988 to may 1989 finally the model is applied to determine the present values of one barrel of oil deliverable in one to ten years time

characterising deindustrialisation an analysis of changes in manufacturing employment and output internationally deindustrialisation is typically conceptualised as a decline in manufacturing as a share of total employment from a kaldorian perspective deindustrialisation could have negative implications for long run growth given the special growth pulling properties of manufacturing however defining deindustrialisation purely in terms of employment share is conceptually limiting given that some of the kaldorian processes operate primarily through output rather than employment as well as blunting empirical analysis by not focussing enough on changes in manufacturing share of gross domestic product gdp this study develops a new method using decomposition techniques to analyse changes in manufacturing employment levels and shares in 48 countries over periods of deindustrialisation the analysis separates out changes in the levels and shares of employment manufacturing into components associated with changes in the share of manufacturing in gdp the growth of manufacturing value added the labour intensity of manufacturing production and economic growth the results indicate that in most cases the decline in manufacturing employment is associated primarily with falling labour intensity of manufacturing rather than an overall decline in the size or share of the manufacturing sector we suggest that deindustrialisation should appropriately be defined in terms of a sustained decline in both the share of manufacturing in total employment and the share of manufacturing in gdp copyright the author 2008 published by oxford university press on behalf of the cambridge political economy society all rights reserved oxford university press

absorbing a windfall of foreign exchange dutch disease dynamics abstract the permanent income rule is seldom the optimal response to a windfall of foreign exchange such as that from a resource discovery absorptive capacity constraints require domestic investment and investment in structures requires non traded inputs the supply of which is constrained by the initial capital stock this particularly when combined with intra sectoral capital immobility delays adjustment and creates short run dutch disease symptoms as the real exchange rate sharply appreciates and overshoots its long run value optimal revenue management requires investing in the domestic non traded goods sector and a slow build up of consumption accumulation of foreign assets adjusts to accommodate the time paths of domestic consumption and investment

macroeconomic policy in an oil exporting economy with foreign exchange controls the sudden and sharp increases in oil prices during the past decade and the discovery and extraction of oil in the north sea have recently contributed to a renewal of interest in the macroeconomic problems of oil exporting countries in general and those of industrialized and semi industrialized oilexporting countries such as the uk and mexico in particular the economic implications of the north sea oil revenues for the british economy have been hotly debated by forsyth and kay 1980 1981 worswick 1980 barker 1981 corden 1981 and byatt et al 1982 the effects of oil and gas revenues on the economies of canada mexico the netherlands norway and the uk have also been the subject of analysis and discussion in barker and brailovsky 1981 despite their important contribution these studies fall short of formulating a comprehensive theoretical framework for the study of macroeconomic policy in oil exporting countries in general the resurgence of interest in the macroeconomics of oil exporting economies and the lack of a satisfactory theoretical framework emphasize the need for the explicit introduction of an oil sector into macroeconomic models of the open economy the more recent studies by buiter and purvis 1983 eastwood and venables 1982 corden and neary 1982 and neary and purvis 1982 have gone some way towards meeting this need but they are better suited to the study of macroeconomic policy in developed oil exporting countries such as the united kingdom where highly developed financial markets already exist 1 without exception all these studies assume that the economy under consideration operates with a floating exchange rate and that the private capital is internationally mobile they also invariably ignore the short term and the long term financial repercussions of changes in oil income that operate via the government budget constraint and the asset position of the private sector these assumptions are however inappropriate for most oil exporting countries in the middle east africa and latin america the purpose of this paper is to examine the short run and long run macroeconomic consequences of an increase in oil revenues in an oil exporting country characterized by strict foreign exchange controls on private capital flows we attempt to do this in the context of a keynesian underemployment model of the type analysed for example by turnovsky and kaspura 1974 branson 1976 and argy and salop 1979 but with domestic prices set according to a mark up rule along the lines advocated for example by fetherston and godley 1978 1981 unlike argy and salop but in line with other recent contributions to the macroeconomic theory of open economies the present paper explicitly allows for the existence of the government budget constraint and analyses the macroeconomic effects of changes in oil revenues both in the short run when

modeling heterogeneous farm responses to european union biofuel support with a random parameter multicrop model although there is now widespread evidence of substantial variability in economic agents responses to economic drivers in many applied economics fields this variability has been largely overlooked by econometric agricultural production models this article sets out to fill this gap by providing methodological contributions and empirical results first we consider panel data multicrop models featuring random intercept and slope parameters to account for the heterogeneous responses of crop producers to economic drivers second we show that monte carlo expectation maximization algorithms are particularly well suited to estimating this type of model third based on an application of our empirical modeling framework with a sample of french grain crop producers we demonstrate substantial variability in farmers responses to economic incentives fourth we use the estimated model and a simple statistical calibration procedure to build farm specific simulation models which are then used to evaluate the effects of the rapeseed price increase induced by european union eu biofuel support our simulation results demonstrate that ignoring the variability in the considered farmers responses to the economic incentives results in significant overestimation of the increases in rapeseed yield levels and variable input use levels induced by eu biofuel support as well as significant underestimation of the variability in the congruent increases in rapeseed acreages

toward efficiency in the crude oil market the official opec prices of crude oil before the collapse in the oil market in the mid 1980s can be interpreted as contract prices and analysed on the basis of the theory of futures or forward markets this paper uses the generalized method of moments estimation technique to test for efficiency in the relationship between the official prices and the ex post spot prices at the time of delivery efficiency is rejected for the sample period 1978 1985 as a whole but evidence is found of improvements over time further the gmm wald and hansen tests although asymptotically equivalent are shown to differ greatly when applied to a small sample of monthly oil price data

estimating the environmental impact of land and production decisions with multivariate selection rules and panel data we propose an estimation procedure dealing with multivariate selection and dynamics in land choice and unobserved heterogeneity in structural and crop selection equations the method is applied to a multi output profit function with multiple corner solutions and farm level panel data estimation results reveal that the single selection rule associated with the tobit procedure is rejected in favor of our multivariate selection treatment inconsistent estimates are expected with the tobit procedure or if farmer fixed effects are omitted which can have important consequences for policy recommendations as illustrated in an evaluation of nitrogen runoff elasticities with respect to economic variables copyright 2011 oxford university press

policy adjustments to the oil boom and their evaluation the dutch disease in indonesia abstract this paper analyzes the effects of two policy adjustments namely exchange rate devaluation and the accumulation of budget surpluses to the oil export boom in indonesia by using a simple simulation model our results indicate that exchange rate adjustment had a significant impact on expansion of tradable sectors especially the manufacturing sector by reversing the real exchange rate while officially maintaining the balanced budget principle the government exercised delicate operations whereby the budget surpluses were covertly accumulated as government deposits such operations were executed as a necessary demand management policy to ensure that the effect of devaluation was persistent these policy adjustments were consistent from a macroeconomic management point of view and have contributed to avoiding the dutch disease that indonesia otherwise might have suffered because of its oil bonanza

structural agricultural land use modeling for spatial agro environmental policy analysis this paper develops a spatially disaggregated structural econometric model of agricultural land use and production based on the joint multi output technology representation introduced by chambers and just 1989 starting from a flexible specification of the farm profit function we derive land use allocation input application crop yield and livestock intensity equations in a joint and theoretically consistent framework to account for the presence of censored observations in micro level data the model is estimated as a system of two limit tobit equations via quasi maximum likelihood we present an empirical application using fine scale spatial data covering the entirety of england and wales and including the main economic policy and environmental drivers of land use change in the past forty years a simulation of the effects of diffuse pollution reduction measures illustrates how our approach can be applied for agro environmental policy appraisal

a continuous time equilibrium model of forward prices and futures prices in a multigood economy abstract this paper is a theoretical investigation of equilibrium forward and futures prices we construct a rational expectations model in continuous time of a multigood identical consumer economy with constant stochastic returns to scale production using this model we find three main results first we find formulas for equilibrium forward futures discount bond commodity bond and commodity option prices second we show that a futures price is actually a forward price for the delivery of a random number of units of a good the random number is the return earned from continuous reinvestment in instantaneously riskless bonds until maturity of the futures contract third we find and interpret conditions under which normal backwardation or contango is found in forward or futures prices these conditions reflect the usefulness of forward and futures contracts as consumption hedges

futures markets price stabilization and efficient exploitation of exhaustible resources markets for natural resource futures contracts and cash forward contracts experience a rapid growth according to theory this should result in more efficient resource depletion implying that price formation is more consistent with hotelling s rule the rationale of this stabilization effect is briefly discussed next we analyze the impact of expanding futures markets on the behaviour of individual resource owners trading on the cash market using a simple pulse extraction model we demonstrate that the expected time of depletion can shift to the present or the future and that utility of exploitation can go up or down as market prices are stabilized

multicrop production models with multinomial logit acreage shares the main objective of this paper is to show that the multinomial logit mnl framework can be used for deriving simple acreage share models more specifically we show that mnl acreage choice models can be defined as parts of consistent multicrop models when coupled with suitably designed crop production models e g a specific parameterization of the standard quadratic yield function the parameters of these multicrop models are easily interpreted and estimated although mnl acreage choice models are usually derived by aggregating crop choices defined at the plot level we show that these models can also be derived by considering a profit maximisation problem at the farm level this provides a simple theoretical background for the standard mnl acreage share model as well as for simple extensions of these models the nested mnl acreage share models an empirical application on french farm level data over the period 1996 2007 investigates the empirical performances of the multicrop econometric models based on the proposed mnl framework for modelling acreage choices

impacts of federal crop insurance on land use and environmental quality this article integrates economic and biophysical models to assess how federal crop revenue insurance programs affect land use cropping systems and environmental quality in the u s corn belt region the empirical framework includes econometric models that predict land conversion and crop choices at the parcel level based on expectation and variance of crop revenues land quality climate conditions and physical characteristics at each site the predictions are then combined with site specific environmental production functions to determine the effect of revenue insurance on nitrate runoff and leaching soil water and wind erosion and carbon sequestration results suggest that federal crop insurance has on average a small effect on conversions of non cropland to cropland and somewhat more significant impacts on crop choice and crop rotation these changes in cropping systems have on average small impacts on agricultural pollution

the pricing of oil and gas some further results the hotelling valuation principle hvp implies that the unit value of an exhaustible natural resource can be written as a function of its current price net of extraction costs other variables such as interest rates have no additional explanatory power the results of earlier tests using data from 1979 1981 strongly support the hvp this paper presents a series of follow up tests using time series cross section data covering the period august 1981 to december 1983 because the variance of petroleum prices in this period was substantially less than in the earlier period the follow up sample proved generally noninformative the sample also contains some observations on oil and gas royalty trusts tests of the hvp using these trust data yielded generally satisfactory results although given the limited sample size the results must be viewed with caution the purpose of this paper is to present follow up tests of the hotelling valuation principle hvp for exhaustible resources the hvp and the earlier tests are described in detail in an earlier paper miller and upton 5 and we will limit ourselves here to a brief summary the principle that the unit price of an exhaustible natural resource less the marginal cost of extraction will tend to rise at the rate of interest was first stated by harold hotelling 2 it follows from intertemporal profit maximization on the part of a price taking owner of an exhaustible natural resource if the unit price of resources net of extraction costs is expected to rise by less than the rate of interest why not extract it now and if it will rise by more why extract any today the hotelling principle has become the standard paradigm for natural resource economics although perhaps more from the absence of any viable alternative than from strong empirical validation earlier tests of the hotelling principle generally based on time series of resource prices have yet to provide convincing support

commodity price volatility with endogenous natural resources abstract natural resource reserves are exogenous in models of small commodity exporters changes in the stock of reserves play no role in the macroeconomy including in business cycle volatility trade dynamics or exchange rate volatility we consider richer supply dynamics and model exploration and depletion we show that an endogenous supply of reserves is important for capturing the stylised facts associated with commodity price shocks including a commodity currency the crowding out of non commodity activity dutch disease and a volatile business cycle we also consider how exploration and depletion affect the ranking of optimal monetary and taxation policies when natural resource reserves are held fixed monetary policy is an efficient tool for stabilising the effects of commodity price shocks however when exploration and depletion are accounted for using interest rates to stabilise the effects of commodity price changes becomes inefficient using taxes on the resource sector specifically an ad valorem royalty remains efficient

exploration for petroleum and the inventory of proven reserves abstract this paper addresses the following question does the number of proven petroleum reserves on the norwegian continental shelf justify the current level of exploratory effort the paper argues that this effort should be curtailed for some time to come it also provides a framework within which the recurrent problem of selecting an appropriate level of exploratory effort can be analysed

industrial policy and exchange rate scepticism the aim of the present paper is to put in historical perspective the development thinking on the relationship between industrial and exchange rate policies the first section focuses on the thought of the so called pioneers of development economics specifically their preference for protectionism and their belated recognition that an exchange rate policy could act as a substitute to it in the second one we analyze the exchange rate skepticism that arises out of the theories that identify a foreign constraint to growth in addition to the one revealed by the pioneers the third section briefly complements the previous discussion with reference to macroeconomic formulations that allow for short run contractionary effects of a devaluation reinforcing the skepticism in question in the fourth section we discuss the revival of development thinking in the 1980s and its discussion about east asian trajectories a literature that placed great emphasis on industrial policy finally in the fifth section we discuss the new historical facts and the new development macroeconomics models that are putting an end to exchange rate skepticism

on monopoly power in extractive resource markets abstract potential monopoly power in extractive resource markets is reduced by the depletability of reserves this paper examines the dependence of monopoly power on resource rent and on uncertainty over future reserve levels a model is developed that treats reserves as inventories that fluctuate stochastically over time as a result of exploration development and production activities solutions of the model illustrate how output and monopoly power vary with the elasticity of demand rent as a fraction of price and the variance of reserve fluctuations it is shown that uncertainty over future reserves can speed up production and by reducing resource rent restore part of the monopoly power otherwise lost because of depletion antitrust implications are discussed with reference to several resources

equilibrium exhaustible resource price dynamics we develop equilibrium models of exhaustible resource markets with endogenous extraction choices and prices our analysis demonstrates how adjustment costs can generate oil and gas forward price dynamics with two factors consistent with the behavior these commodities exhibit in the schwartz and smith 2000 calibration our two factor model predicts that stochastic volatility will arise in these markets as a natural consequence of production adjustments however and we provide supporting empirical evidence differences between endogenous price processes from our general equilibrium model and exogenous processes in earlier papers can generate significant differences in both financial and real option values

crop supply dynamics and the illusion of partial adjustment we use field level data to estimate the response of corn and soybean acreage to price shocks our sample contains more than 8 million observations derived from satellite imagery and includes every cultivated field in iowa illinois and indiana we estimate that aggregate crop acreage responds more to price shocks in the short run than in the long run and we show theoretically how the benefits of crop rotation generate this response pattern in essence farmers who change crops due to a price shock have an incentive to switch back to the previous crop to capture the benefits of crop rotation our result contradicts the long held belief that agricultural supply responds gradually to price shocks through partial adjustment we would not have obtained this result had we used county level panel data standard econometric methods applied to county level data produce estimates consistent with partial adjustment we show that this apparent partial adjustment is illusory and we demonstrate how it arises from the fact that fields in the same county are more similar to each other than to fields in other counties this result underscores the importance of using models with appropriate micro foundations and cautions against inferring micro level rigidities from inertia in aggregate panel data our preferred estimate of the own price long run elasticity of corn acreage is 0 29 and the cross price elasticity is 0 22 the corresponding elasticities for soybean acreage are 0 26 and 0 33 our estimated short run elasticities are 37 larger than their long run counterparts

valuation and management of fishing resources under price uncertainty the traditional expected net present value methods cannot properly capture the management flexibility and strategic value aspects of a fishery and may understate its value instead this paper develops a real options model to conceptualize and evaluate fishery exploitation flexibility specifically general models to value the opportunity to either exploit or invest in a fishery are presented they suffice to determine not only these values but also the optimal policy for opening closing delaying and setting its harvest rate the sustainable case in which the harvest rate equals the natural net growth function is also considered concerning the exploitation decision it is found that as could be expected the higher the resource price the higher the value of this opportunity in both models general and sustainable however the resource stock affects both models differently as to the investment opportunity its value is always lower than the exploitation opportunity because of investment costs finally numerical simulations are run in order to illustrate the nature of the solution sensitivity analysis concerning the influence of the tax rate convenience yield risk free interest rate and price volatility on the value of the fishery is also reported

the political economy of chile s fast economic growth an olsonian interpretation a conceptual framework inspired by mancurolson s contributions to political economyis used to explain chile s recent economicand political performance with particularemphasis on the hidden hand politicalstability rent seeking policy makingquality institutions cultural attitudesand cultural change fortunate historicalaccidents critical masses and virtuouscircles and other positive loops theanalysis combines very long term withshort term perspectives examining the warof arauco basque immigration open economypolicies families educational investment economic technocrats female labour forceparticipation managerial perceptions oflabour and other old myth shattering some future trends are also predicted

booming sector and de industrialisation in a small open economy this paper presents a theoretical analysis of the dutch disease the phenomenon whereby a boom in one traded goods sector squeezes porfitability in other traded goods sectors both by directly bi

interpreting suboptimal business outcomes in light of the coase theorem lessons from sidmouth international festival abstract the management team of the world famous sidmouth festival resigned in 2004 after failing to secure bad weather underwriting worth 200 000 and amidst widespread fears that the festival was doomed while claims of a local economic impact of 5 million are seriously flawed it is highly likely that the local economy did benefit by at least several times the amount of the required insurance failure to capture these net positive benefits is linked to ill defined property rights rising transaction costs incomplete information from unreliable sources and actual or feared free riding these conditions prevented the type of efficient bargaining solution in the face of externalities envisioned by the coase theorem practically all of the problems preventing the ideal coasean solution could have been addressed by granting key stakeholders individual ownership rights hence while the coase solution was not applicable the theorem s predictions or its corollary s predictions were confirmed

the varieties of resource experience natural resource export structures and the political economy of economic growth many oil mineral and plantation crop based economies experienced a substantial deceleration in growth following the commodity boom and bust of the 1970s and early 1980s this article illustrates how countries dependent on point source natural resources those extracted from a narrow geographic or economic base such as oil and minerals and plantation crops are predisposed to heightened economic and social divisions and weakened institutional capacity this in turn impedes their ability to respond effectively to shocks which previous studies have shown to be essential for sustaining rising levels of prosperity analysis of data on classifications of export structure controlling for a wide array of other potential determinants of governance shows that point source and coffee and cocoa exporting countries do relatively poorly across an array of governance indicators these governance effects are not associated simply with being a natural resource exporter countries with natural resource exports that are diffuse relying primarily on livestock and agricultural produce from small family farms do not show the same strong effects and have had more robust growth recoveries

endogenous growth with a limited fossil fuel extraction capacity campbell 1980 and following authors have discussed a limited resource extraction capacity as an augmentation of the well known hotelling model we integrate a limited extraction capacity and related investments in the endogenous growth model of tsur and zemel 2005 to study its effect on economic development the capacity constraint gives rise to three effects on the one hand higher energy costs and the reallocation of production towards capacity investments decrease production available for consumption research and or capital investments energy costs and reallocation effect on the other hand research investments may increase which boosts available production research effect depending on the capital endowment and the strength of the effects long run consumption may be boosted or depressed in particular the capacity constraint may render everlasting consumption growth non optimal in a resource rich economy furthermore we find that capacity investments may be postponed to later points in time if the capital endowment is high

the benefits of storage and non renewable resource price dynamics both the theory of storage and the hotelling model play a prominent role in the study of non renewable resource prices this paper combines these approaches by modifying the hotelling model to allow firms to hold inventory in addition to in ground reserves contributing three new results first inventory is more likely to be held if future demand and or the marginal cost of extraction are uncertain second the market price of the commodity is based on the theory of storage when inventory is held third the optimal extraction of the resource is based on the hotelling model a la fois la theorie de l entreprosage et le modele d hotelling jouent un role important dans l etude du prix des ressources non renouvelables le present memoire combine ces approches en modifiant le modele d hotelling pour permettre aux entreprises de detenir des inventaires en plus de reserves souterraines cela produit trois resultats d abord on est davantage susceptible de detenir des inventaires si la demande future et ou le cout marginal de l extraction sont incertains ensuite le prix du marche de la ressource est fonde sur la theorie de l entreposage quand inventaire il y a enfin l extraction optimale de la ressource est basee sur le modele d hotelling

accounting for heterogeneity in multicrop micro econometric models implications for variable input demand modeling this article aims to show that if the farm sample under consideration is characterized by significant heterogeneity recovering output specific input uses or modeling farm level input uses may be more complicated than previously recognized the article theoretically investigates the problems implied by farm heterogeneity in input allocation equations and multicrop econometric models proposes an empirically tractable solution for overcoming these problems and assesses the empirical relevance of the theoretically identified problems the results demonstrate that heterogeneity matters but that the revealed heterogeneity bias has a limited impact on the empirical results copyright 2012 oxford university press

behaviour of non renewable natural resource firms under uncertainty optimizing or ad hoc abstract this paper tests the assumption of optimizing behaviour by natural resource firms in the framework of an intertemporal model of non renewable resource development and production using data from the petroleum industry it is argued that the presence of geological and price uncertainty presents a situation in which standard objections to non optimizing behaviour may not hold as an alternative it is proposed that firms use an ad hoc rule of thumb to update decisions as the values of variables change econometric results support ad hoc behaviour as opposed to intertemporal profit maximization

resource boom wages and unemployment theory and evidence from the norwegian petroleum experience the effects of norwegian petroleum activities on nominal wages and the rate of unemployment are analyzed in this paper the theoretical model is based on standard theory of segmented labor markets increased nominal wages in the petroleum sector will unambiguously increase the wage level and the rate of unemployment increased petroleum employment will under realistic assumptions also raise the wage level the effect on the rate of unemployment in this case is ambiguous the empirical model is embedded in reduced forms of the theoretical model and the estimated parameters are consistent with the theoretical results

optimal pricing use and exploration of uncertain natural resource stocks abstract units of natural resources to be called mines are assumed distributed over an unexplored territory according to a poisson process in space at any moment total reserves and unexplored land are given society can determine the rate of consumption and the rate of exploration reserves are drawn down by consumption and increased by discoveries made during exploration the amount of unexplored land is decreased by exploration at any moment the payoff of society is a concave function of consumption less a linear function of exploration with future payoffs discounted optimal policies are considered and in particular it is shown for a large amount of unexplored land the shadow prices of reserves and of unexplored land move in random cycles but show only a slight upward tread thereby casting some light on the failure of mineral prices to rise at the market rate of interest

panel data estimation techniques and farm level data models econometric models wishing to estimate relevant parameters for agricultural policy analysis are increasingly relying on unbalanced panels of farm level data since in the agricultural economics literature such models have often been estimated through simplified approaches in this paper we try to verify whether the adoption of more sophisticated panel data techniques may impact the estimation results for this reason the policy model by moro and sckokai 1999 has been re estimated using techniques recently developed in the econometric literature the preliminary results show a strong impact on the estimations this seems to suggest that the adoption of proper panel data techniques is likely to be very important in order to obtain reliable estimates of some key policy parameters

natural disasters and labor markets abstract while it is clear that natural disasters have serious welfare consequences for affected populations less is known about how local labor markets in low income countries adjust to such large shocks combining data from the indonesia family life survey the desinventar database the u s geological survey and district level employment indicators this paper explores how a large earthquake in indonesia affected labor market outcomes in particular the evolution of wages across sectors i find that the earthquake had a positive effect on wage growth for workers who were employed in the agricultural sector at baseline i propose two mechanisms for this result a higher growth rate of the price of rice and a downward shift in the supply of workers in the agricultural sector i show that evidence mainly supports the latter labor shifted out of the agricultural sector into the construction sector raising the marginal product of labor in agriculture

market government and malaysia s new economic policy leading economic institutions such as the world bank have argued that liberalisation holds the key to growth poverty alleviation and redistribution even recent efforts to model increasing returns within the framework of new growth theories have not resulted in prescriptions for stronger roles for governments the fast growing southeast asian economies are still being used to demonstrate causation between liberalisation and growth poverty alleviation and redistribution using malaysia as an example this paper argues that growth poverty alleviation and redistribution in the country was achieved under circumstances of both interventionist policies as well as market coordination throughout the new economic policy nep period 1970 90 strong incentives were offered to both the import substitution and exportoriented manufacturing sectors and the state made strong forays into the market to redress poverty and inequality the paper also argues that poorly coordinated government intervention generated substantial unproductive rent seeking

a test of the hotelling valuation principle time series tests of the hotelling r percent rule for natural resource prices have not been strongly supportive but the tests and the data are subject to serious difficulties we propose here an alternative testing strategy based on another but less widely known implication of the hotelling model we test this implication which we call the hotelling valuation principle by regressing the market values of the reserves of a sample of u s domestic oiland gas producing companies on their estimated hotelling values we find that the estimated hotelling values account for a significant portion of the observed variations in market values and that the hotelling measures are better indicators of the market values of petroleum properties than two widely cited publicly available alternative appraisals

the relation between forward prices and futures prices abstract this paper consolidates the results of some recent work on the relation between forward prices and futures prices it develops a number of propositions characterizing the two prices these propositions contain several testable implications about the difference between forward and futures prices many of the propositions show that equilibrium forward and futures prices are equal to the values of particular assets even though they are not in themselves asset prices the paper then illustrates these results in the context of two valuation models and discusses the effects of taxes and other institutional factors

information and exhaustible resources a bayesian analysis abstract we develop a continuous time bayesian model of investment in information about an exhaustible resource because of the way that information affects expectations the deterministic hotelling rule turns out to be more appropriate as a description of how resource owners forecast the value of their stocks than as a predictor of observed changes in the resource price a flow of information generates both unanticipated changes in expectations which cause the mean rate of change in the resource price to deviate systematically from the deterministic hotelling rule and reductions in uncertainty which do not affect the hotelling prediction

oligopoly extraction of a common property natural resource the importance of the period of commitment in dynamic games the theory of noncooperative dynamic games has provided an extremely powerful framework for studying many of the classic questions in industrial organization for example questions about resource extraction advertising research and development investment in new capacity and barriers to entry where interactions over time among few firms are involved however an important methodological issue arises when economic competition over time is modeled as a dynamic game the issue is the appropriate formulation of the players strategy spaces

uncertainty and the convenience yield in crude oil price backwardations abstract this study examines why firms hold stocks of crude oil particularly during price backwardations when spot prices exceed prices for forward delivery using a stochastic control model this paper shows that the equilibrium value of inventories contains the conventional hotelling principle the convenience yield from the classical theory of storage and an option value related to price uncertainty our empirical results suggest that a convenience yield and risk premium are important elements of crude oil price backwardations

commodity currencies and the real exchange rate abstract this paper shows that a change in the terms of trade of a commodity exporting country could cause the relative price of nontraded goods to rise or fall depending on the strength of income and substitution effects

explaining the rain the rise and decline of nations after 25 years in the quarter century since the publication of mancur olson s rise and decline of nations a large literature has evolved testing the central hypothesis regarding olson s thesis on institutional sclerosis these tests have taken the form of both econometric regression analysis involving a sample of various nations and detailed narrative case studies of specific nations tests have appeared in both economics and political science journals as well as in collected volumes and independent books performed primarily by authors from america and europe a review of over 50 separate works reveals that on the whole the theory of institutional sclerosis is generally but certainly not universally supported no systematic bias in favor of or opposition to olson is found to have arisen on the basis of methodology publication outlet or authorship location