annual and cropping season environmental production conditions effects on smallholder technical efficiency in sub saharan africa evidence from ethiopia this article investigates the impact of environmental production conditions on smallholder farmers technical efficiency in ethiopia for wheat maize and sorghum farming we use a household panel data set with annual and cropping season environmental production conditions to estimate the technical efficiency scores the results show that including environmental production conditions in the stochastic frontier has a significant impact on farmers technical efficiency scores technical efficiency scores improve when environmental production conditions are incorporated in the stochastic frontier thus accounting for environmental production conditions reduces the inefficiencies that otherwise may be attributed to the characteristics of smallholder farmers

market contagion evidence from the panics of 1854 and 1857 to test a model of contagion where individuals hear some bad news and communicate it to their acquaintances who then pass it on leading to a market panic requires a knowledge of the information networks of participants something hitherto unavailable for two panics in the 1850s this paper examines the behavior of irish depositors in a new york bank as recent immigrants their social network was determined largely by their place of origin in ireland and where they lived in new york during both panics this social network turns out to be the prime determinant of behavior

a nonparametric cost approach to scale efficiency starting with farrell fieldhouse 1962 a host of notiparametric models have been developed for calculation of scale efficiency a common property of these models is that they are specified in terms of input output data duality theory has taught us that technological characteristics may be analyzed from either the primal or the dual cost side the purpose of this paper is to introduce a nonparametric dual method of calculating scale efficiency

optimal income taxation with adverse selection in the labour market this article studies optimal linear and non linear redistributive income taxation when there is adverse selection in the labour market unlike in standard taxation models firms do not know workers abilities and competitively screen them through non linear compensation contracts unobservable to the government in a miyazaki wilson spence equilibrium adverse selection leads to different optimal tax formulas than in the standard mirrlees 1971 model because of the use of work hours as a screening tool by firms which for higher talent workers results in a rat race and for lower talent workers in informational rents and cross subsidies the most surprising result is that if the government has sufficiently strong redistributive goals welfare is higher when there is adverse selection than when there is not policies that endogenously affect adverse selection are discussed the model has practical implications for the interpretation estimation and use of taxable income elasticities which are central to optimal tax design

farm household production efficiency evidence from the gambia this article investigates the economic efficiency of farm households with an application to the gambia the efficiency analysis is conducted not at the farm level but at the household level thus capturing the importance of off farm activities output based measures of technical allocative and scale efficiency are generated using nonparametric measurements an econometric analysis of factors affecting the efficiency indexes is then conducted using a tobit model technical efficiency is fairly high indicating that access to technology is not a severe constraint for most farm households the cost of scale inefficiency is modest allocative inefficiency by contrast is found to be important for the majority of farm households on the basis of the tobit results imperfections in markets for financial capital and nonfarm employment contribute to significant allocative inefficiency

supply response in ethiopia accounting for technical inefficiency few empirical studies of supply response using the profit function have accounted for technical inefficiency using farm level panel data from ethiopia this study examines the effect of incorporating technical inefficiency in estimating the supply response of peasant farmers two systems of output supply and input demand equations are estimated and compared the conventional model in which technical efficiency is assumed and another in which technical inefficiency is explicitly incorporated the model with technical inefficiency is preferred on grounds of theoretical consistency and improved estimates although model comparison tests are not conclusive incorporation of inefficiency generally increases the magnitudes and the statistical significance of own price elasticities substantially so in the case of fertilizer and fertilizer intensive crops and alters the priority attached to nonprice factors an important result is that only the specification with inefficiency reveals a significant effect of access to extension services on output only this specification finds that output increases with household size which one expects as the farms in the sample are largely subsistence and producing for own consumption furthermore the results demonstrate that farmers response to incentives is considerably restricted by inefficiency suggesting that the traditional model would overstate response by excluding the efficiency variable

estimating the open market desk s daily reaction function this paper presents the results of an empirical investigation into the proximate determinants of the federal reserve s daily open market operations using information available each morning at the fed conference call the author models the open market desk s choice of both the quantity and the type of operation using a friction model for the former and a multinomial logit framework for the latter different types of operations are shown to send different signals to the market about the underlying thrust of fed policy and open market operations in recent years are shown to have become increasingly keyed to the federal funds rate copyright 1993 by ohio state university press

how robust are popular models of nominal frictions this paper analyzes three popular models of nominal price and wage frictions to determine which best ts post war u s data we construct a dynamic stochastic general equilibrium dsge model and use maximum likelihood to estimate each model s parameters because previous research nds that the conduct of monetary policy and the behavior of in ation changed in the early 1980s we examine two distinct sample periods using a bayesian pseudo odds measure as a means for comparison a sticky price and wage model with dynamic indexation best ts the data in the early sample period whereas either a sticky price and wage model with static indexation or a sticky information model best ts the data in the late sample period our results suggest that price and wage setting behavior may be sensitive to changes in the monetary policy regime if true the evaluation of alternative monetary policy rules may be even more complicated than previously believed

markets under price controls in partial and general equilibrium abstract when parallel markets arise in the face of price or other controls two aspects of agents behavior become crucial in analyzing market outcomes first sellers risk will rise with increases in illegal sales but may also fall with increases in legal sales if the latter is true the parallel market price will induce higher output second if consumers can be given access to the price controlled good without incurring search queuing and other transaction costs due to rationing production of the controlled good will be higher these effects are demonstrated in both partial and general equilibrium

smuggling and price disparity abstract this paper proposes a model of smuggling consistent with the coexistence of smuggling legal trade and price disparity defined as a domestic price which exceeds is less than the return from legal export import these phenomena have been found to characterize indonesian smuggling a framework is presented in which legal trade is used to cloak smuggling activity with the implication that the greater the volume of legal trade the less the costs of smuggling this model is then used to explain the observation noted above and to show that smuggling may be welfare increasing vis a vis the non smuggling situation and that even if the suppression of smuggling is costless tax revenue maximization may require a positive level of smuggling in addition the model is applied to coffee and rubber exports from indonesia

the ethiopian commodity exchange and spatial price dispersion abstract in this article we study the impact of an institutional intervention on market efficiency in ethiopia more specifically we analyze to what extent the ethiopian commodity exchange ecx in combination with regional warehouses have contributed to a reduction in price spreads between regional markets our hypothesis is that warehouses connected to the ecx reduce the dispersion between export prices and local retail prices in different coffee growing areas as well as the dispersion between export prices and local retail prices in different coffee growing areas by doing so the ecx has the potential to improve the market efficiency to identify the causal effect we combine retail price data with information on the gradual rollout of warehouses connected to the ecx from 2007 to 2012 our results suggest that when two markets both have access to an operating warehouse the average price spread is 0 86 1 78 etb lower than it is for markets where at least one part lacks warehouse access this is a substantial reduction considering that the average price spread over the full period is 3 33 etb the main results are robust to various econometric specifications and our analysis thus suggests that local warehouses connected to the ecx have indeed improved market efficiency

how efficient is maize production among smallholder farmers in zimbabwe a comparison of semiparametric and parametric frontier efficiency analyses the controversial fast track land reform programme in zimbabwe that redistributes commercially owned farmland to smallholder households has caused concerns about the efficiency of agricultural prod

evaluating the impact of agricultural extension on farms performance in crete a nonneutral stochastic frontier approach this article attempts to integrate the production and the efficiency based approaches for evaluating the impact of extension on farms performance for this purpose the nonneutral production frontier model is used and the empirical analysis refers to a sample of farms from crete greece the empirical results support the proposed formulation instead of either the production or the efficiency based formulations as extension was found to have a statistically significant effect on closing both the technology and management gaps public and private extension services were found to be competitive in the production function and complementary in the technical inefficiency effect function in addition farms using both public and private extension services achieved a higher degree of technical efficiency than those using either public or private extension services and farms with no extension services were found to be the least efficient

black markets illegality information and rents abstract the analysis of black markets typically treats illegality only in reduced form as an additional cost per transaction we argue that this misses the essential feature of black markets that the risk of detection depends upon the dissemination of information because the cost of information is increased traders will change marketing technology from advertising to sequential approaches to potential customers the trader s decision problem is his offer price as he raises it he must expect to make more approaches per sale and thereby increase detection risk this behavior is important because of its implications at the market level the optimal offer price will be set at a level at which excess demand persists would be consumers are not always able to bid themselves into supplies hence black markets are not sufficient to eliminate the shortages which arise from price controls in an earlier paper the authors established that peasant supply response to crop prices would be perverse in the presence of shortages black markets therefore need not restore normal responses the paper includes evidence from rural tanzania

a simple tax structure for competitive equilibrium and redistribution in insurance markets with asymmetric information in their influential paper rothschild and stiglitz 6 demonstrated that the existence of nash equilibrium is not a general property of insurance markets when buyers have private information about their riskiness and firms face free entry and exit conditions this paper presents a simple and implementable system of taxes and subsidies applied to firms which permits a nash equilibrium always to exist we also show that more than one nash equilibrium is open to the regulator in particular government can effect risk discriminating redistribution without a priori knowledge of any individual buyer s riskiness hence it is not the case that the inability to distinguish between types of buyers rules out compensation risk discriminating transfers even in principle as claimed by schmalensee 7 442 finally we show that even when a nash equilibrium exists without government intervention there are always alternative and under some circumstances pareto superior equilibria open to the regulator since these alternative equilibria entail cross subsidization from low risk to high risk buyers our results suggest that the well known cross subsidization enforced through current regulatory practices is consistent with economic efficiency we conclude that the informational asymmetry assumed by rothschild and stiglitz poses distinct efficiency and distribution problems as do more conventional non informational situations of market failure and that regulators can influence the allocation of insurance through conventional instruments of intervention without assuming dictatorial control of the market

value and quantity data in economic and technical efficiency measurement this paper calls attention to the implications of using value data in efficiency measurement through data envelopment analysis dea the main contributions are twofold i it provides a reconciliation of the previous literature on analysing issues of quantity and value data in efficiency measurement ii it provides some guidelines on what to do when these issues arise in a data set

technology shocks structural breaks and the effects on the business cycle abstract it is shown that time series of us productivity and hours are apparently affected by a structural break in the late 60s moreover the importance of technology shocks over the business cycle has sharply decreased after the break

technical efficiency and productivity of maize producers in eastern ethiopia a study of farmers within and outside the sasakawa global 2000 project abstract this paper investigates the technical efficiency of two samples of maize producers in eastern ethiopia one involving farmers within the sasakawa global 2000 project and the other involving farmers outside this program the study uses stochastic frontier production functions in which the technical inefficiency effects are assumed to be functions of the age and education of the farmers together with the time spent by extension advisers in assisting farmers in their agricultural production operations for the cross sectional data obtained for the 1995 96 agricultural year cobb douglas stochastic frontiers are found to be adequate representations of the data given the specifications of the translog stochastic frontiers for farmers within and outside the project the empirical results indicate that farmers within the sg 2000 project are more technically efficient than farmers outside the project relative to their respective technologies the mean frontier output of maize for farmers within the sg 2000 project is significantly greater than that for the farmers outside the project

ex post impacts of improved maize varieties on poverty in rural ethiopia public agricultural research has been conducted in africa for decades while many studies have examined its aggregate impacts few have investigated how it affects the poor this paper helps fill this gap by applying a new procedure to explore the ex post impacts of improved maize varieties on poverty in rural ethiopia plot level yield and cost changes due to adoption are first estimated using instrumental variable and marginal treatment effect techniques where possible heterogeneity is carefully accounted for a backward derivation procedure is then developed to link treatment effect estimates with an economic surplus model to identify the counterfactual household income that would have existed without improved maize varieties poverty impacts are finally estimated by exploiting the differences between observed and counterfactual income distributions improved maize varieties have led to a 0 8 1 3 percentage drop of poverty headcount ratio and relative reductions of poverty depth and severity however poor producers benefit the least from adoption due to the smallness of their land holdings

estimation of profit functions when profit is not maximum this paper deals with derivation and implications of profit functions when profit is not maximum due to the presence of either technical inefficiency or allocative inefficiency or both we show that input demand and output supply elasticities and returns to scale are in general affected by these inefficiencies we also show that the overall profit efficiency is not necessarily the product of technical and allocative efficiencies meaning that technical and allocative inefficiencies are not necessarily independent estimation techniques are developed for both cross sectional and panel data models working of the model is illustrated using a panel of 60 salmon farms copyright 2001 oxford university press

permanent and transitory policy shocks in an empirical macro model with asymmetric information abstract an empirical model that allows for shifts in the inflation target and imperfect policy credibility is estimated imperfect credibility defined by differences between the perceived and actual inflation target obtains because private agents cannot correctly distinguish between permanent target shocks and transitory funds rate shocks learning affects responses to structural shocks important features include the absence of a price puzzle permanent nominal effects of aggregate supply shocks due to partial policy accommodation and the ability to examine responses to a permanent target change and expectations shocks perceptions of permanent target shocks explain sizable movements in bond yields and inflation

investment crowding out firm level evidence from northern germany michalek j ciaian p and kancs d a investment crowding out firm level evidence from northern germany regional studies the main objective of this paper is to estimate the extent to which firm investment is substituted crowded out by investment support policies granted under the european union rural development programme rdp the empirical analyses employed the difference in difference propensity score matching approach which allows several important sources of bias to be addressed such as selection bias simultaneity bias and functional form misspecification from which many previous studies suffer using panel data of 1333 firms from the schleswig holstein region in germany it is found that the crowding out effect of the rdp is close to 100 implying that firms use public support to substitute for private investments furthermore no evidence was found that due to the rdp programme support firms would have brought forward their investments planned originally for a later period rejecting t

peasant supply response in rationed economies abstract when peasants do not have reliable access to goods on the black market government price controls may result in rationing of peasants demand for consumer goods we show that supply response is then perverse and that the economy may collapse as exports fall and rural shortages intensify such a crisis may initially be disguised as peasants sell export goods to build up money stocks we consider the policy options for governments facing such problems

the spanish beef sector in the 1990s impact of the bse crisis on efficiency and profitability the beef sector has undergone a series of changes as a result of successive food scares and agricultural policy reforms the purpose of the paper is to analyse technical efficiency and profitability in spanish livestock enterprises during the 1990s focusing on the possible impact of the bse crisis and the 1992 cap reform on each of these variables the main findings reveal the existence of technical inefficiency during the sample period some factors have a positive impact others a negative impact on efficiency as far as the effects of cap reform and the bse crisis are concerned the results show the ineffectiveness of agricultural policy regulation to promote efficiency in the sector and the improvement in the efficiency as a consequence of the bse crisis the profitability analysis reveals the importance of direct subsidies however in their absence a large percentage of holdings is unable to remunerate either own or rented factors analysis shows therefore that there are two counteracting effec

farm household efficiency in bangladesh a comparison of stochastic frontier and dea methods this study compares estimates of technical efficiency obtained from the stochastic frontier approach and the data envelopment analysis dea approach using farm level survey data for rice farmers in bangladesh technical inefficiency effects are modelled as a function of farm specific socioeconomic factors environmental factors and irrigation infrastructure the results from both the approaches indicate that efficiency is significantly influenced by the factors measuring environmental degradation and irrigation infrastructure

imperfect information and the equitability of competitive prices in many markets sellers have imperfect information about the costs of sales to different buyers and the pattern of competitive pricing depends on the information available in order to analyze the equity implications of public policies requiring information suppression non utilitarian measures of the horizontal and vertical dimensions of pricing inequity caused by cross subsidization are proposed and examined better information generally reduces vertical inequity but if information about buyers is initially poor additional imperfect information may increase horizontal inequity if information is initially good more information generally lowers both dimensions of inequity

the concept and measurement of horizontal inequity abstract this paper discusses the concept of horizontal equity and presents three formal principles as a basis for making comparisons of the extent of horizontal inequity produced by different redistributions a condition analogous to the lorenz criterion used for inequality comparisons is established under which the horizontal inequities of redistributions can be ranked without recourse to a cardinal measure of inequity ordinal comparisons are not possible in many cases the three principles suggest three properties that reasonable measures of horizontal inequity should possess a class of measures which satisfies the properties is proposed most other existing measures are found not to satisfy them

an empirical study of cereal crop production and technical efficiency of private farmers in ethiopia a mixed fixed random coefficients approach in this paper we use a fixed random coefficients regression model to analyse data for cereal growing small scale farmers in efficiency results show that land size is a major constraint and only small changes in cultivated area and land quality yield relatively high increments to output larger farms are relatively less productive everything else being equal human capital in the form of literacy and experience are found to affect productivity positively our findings show a high degree of farm specific technical inefficiency with regard to the inputs we find high degrees of input specific technical inefficiency especially so for labour and fertilizer the age structure of the household environmental factors and education are found to be weakly correlated with efficiency furthermore sharecropping is found to be positively correlated with technical efficiency

promoting high input maize technologies in africa the sasakawa global 2000 experience in ethiopia and mozambique abstract critics argue that high external input technologies heit are too costly for african farmers and that programs to promote them are economically unsustainable this paper assesses sasakawa global 2000 programs in ethiopia and mozambique using financial and economic analysis yield models and subsector analysis the sg 2000 technology was much more profitable in ethiopia than in mozambique but varied depending on production location fertilizer and transport costs domestic and international prices regional surplus or deficit conditions and production as import substitute or export the case studies provide further evidence that high input technologies can be successfully introduced through well funded high profile programs but not conclusive evidence that such programs can be scaled up and sustained five major implications are discussed concerning 1 prospects for scaling up and sustaining heit adoption 2 the need for expanded profitability analysis 3 the role of trade prospects and policies 4 institution building requirements and 5 infrastructure investments to reduce marketing costs

farm productivity and efficiency in rural bangladesh the role of education revisited this article reassesses the debate over the role of education in farm production in bangladesh using a large dataset on rice producing households from 141 villages average and stochastic production frontier functions are estimated to ascertain the effect of education on productivity and efficiency a full set of proxies for farm education stock variables are incorporated to investigate the internal as well as external returns to education the external effect is investigated in the context of rural neighbourhoods our analysis reveals that in addition to raising rice productivity and boosting potential output household education significantly reduces production inefficiencies however we are unable to find any evidence of the externality benefit of schooling neighbour s education does not matter in farm production we discuss the implication of these findings for rural education programmes in bangladesh

high and volatile real interest rates where does the fed fit in the federal reserve s new procedures for the conduct of monetary policy introduced on october 6 1979 have been the subject not only of considerable academic and political interest but also of intense debate b friedman 1982 roley 1982 walsh 1982 1984 mascaro and meltzer 1983 among others the fed s new operating procedures generally are perceived to have resulted in abnormally high and volatile real interest rates and thus to have contributed to if not been totally responsible for the deepest recession in postwar history in this paper we address the following question was the advent of the increased volatility and level of the real rate of interest concurrent with the fed s october 1979 change in operating procedures that is was the real rate of interest high and more volatile immediately after the october 1979 change in policy procedures in which case we might infer a connection between the fed s change in policy procedures and the increased volatility and level of the real rate or did the real rate become high and more volatile some time following the policy change which might lead us to conclude that the increased volatility and the increased level of the real rate was connected to some other event s occurring after the october 1979 policy change

the new econometrics of structural change dating breaks in u s labor productivity we have seen the emergence of three major innovations in the econometrics of structural change in the past fifteen years 1 tests for a structural break of unknown timing 2 estimation of the timing of a structural break and 3 tests to distinguish unit roots from broken time trends these three innovations have dramatically altered the face of applied time series econometrics in this paper we review these three innovations and illustrate their application through an empirical assessment of u s labor productivity in the manufacturing durables sector

monetary policy rules based on real time data this paper examines the magnitude of informational problems associated with the implementation and interpretation of simple monetary policy rules using taylor s rule as an example i demonstrate that real time policy recommendations differ considerably from those obtained with ex post revised data further estimated policy reaction functions based on ex post revised data provide misleading descriptions of historical policy and obscure the behavior suggested by information available to the federal reserve in real time these results indicate that reliance on the information actually available to policy makers in real time is essential for the analysis of monetary policy rules

supply demand and technology in a multiproduct industry texas field crops the purpose of this paper is to examine the structure of agricultural production for six texas field crops cotton grain sorghum wheat corn rice and hay which account for nearly 95 of recent field crop value specific objectives are to a test the structure of technology to determine i if output and input utilization choices for individual products are independent of production decisions about other outputs and ii if products and or inputs can be consistently aggregated b estimate a coherent set of interrelated supply functions for the six commodities and input demand functions for fertilizer and hired labor because the empirical focus of this paper is specific to one state the results will be of limited value for interpreting specific production relationships elsewhere however the problem is of common interest in production agriculture and the techniques used demonstrate an important application of dual modeling

the impact of imperfectly categorizing risks on income inequality and social welfare the use of imperfect information to categorize risks is a pervasive and controversial phenomenon in the insurance industry although this activity reduces the average extent of vertical price discrimination it is shown in this paper that both highand low risk types may prefer ex ante to knowing the category to which they will be assigned that such information be suppressed furthermore for the lorenz criterion it is shown that under certain restrictive demand conditions the imperfect categorization of risks leads to an increase in inequality the paper employs the wilson e2 equilibrium concept l impact d une categorisation imparfaite des risques sur l inegalite du revenu et le bien etre social l utilisation de renseignements imparfaits pour categoriser les risques est un probleme important qui porte a controverses dans l industrie de i assurance meme si ce phenomene reduit le degre de discrimination verticale par les prix en moyenne i auteur montre que a la fois les personnes dont le coefficient de risques est faible et elev6 et ce avant de savoir a quelle categorie on va les assigner peuvent fort bien preferer que cette information soit supprimee de plus 1 auteur montre que sous certaines conditions de demande restrictives la categorisation imparfaite des risques conduit a un accroissement du degre d inegalite mesure par le critere de lorenz ce memoire utilise le concept d equilibre dit de wilson e2 if insurance firms are unable to distinguish between the risk types of their clients but consumers know their own probability of loss i e if asymmetric information persists then the complication of adverse selection may arise adverse selection occurs when the class of risks or set of classes that purchases insurance differs adversely from that anticipated by the firm for example if a firm offers a contract to low risk types at their actuarially fair rate then high risk types will also purchase it with the result that the firm will earn expected losses hence the problem of adverse selection restricts the ability of firms to offer efficient insurance contracts to low risk types it has been demonstrated by rothschild and stiglitz 1976 that provided the proportion of high risk types in the population is above some critical level a this paper is a revised version of chapter 3 of the author s phd thesis entitled the economics of risk classification in insurance london school of economics and political science 1982 i am indebted to my supervisor lucien foldes and an anonymous referee for useful comments the author alone is responsible for any errors herein canadian journal of economics revue canadienne d economique xvil no 3 august aotlt 1984 printed in canada imprimd au canada 0008 4085 84 557 568 1 50 c canadian economics association this content downloaded from 157 55 39 215 on wed 31 aug 2016 04 39 57 utc all use subject to http about jstor org terms

policy regime changes judgment and taylor rules in the greenspan era this paper investigates policy deviations from linear taylor rules motivated by the risk management approach followed by the fed during the greenspan era we estimate a nonlinear monetary policy rule via a logistic smoothing transition regression model where policy makers judgment proxied by economically meaningful variables drives the transition across policy regimes we find that ignoring judgment induced nonlinearities while estimating taylor rules has remarkable costs in terms of fit above 250 bps in 10 quarters although linear taylor rules describe well the broad contours of monetary policy they fail to detect relevant policy decisions driven by policy makers judgment

understanding preferences for income redistribution abstract recent research suggests that income redistribution preferences vary across identity groups we employ statistical learning methods that emphasize pattern recognition classification and regression trees cart and random forests randomforests to uncover what these groups are using data from the general social survey we find that out of a large set of identity markers only race gender age and socioeconomic class are important classifiers for income redistribution preferences further the uncovered identity groupings are characterized by complex patterns of interaction amongst these salient classifiers we explore the extent to which existing theories of income redistribution can explain our results but conclude that current approaches do not fully explain the findings

peasant household behaviour with missing markets some paradoxes explained a model of peasant household behavior under varying degrees of household specific food and labor market failures is constructed to show that these structural features can explain several well known patterns of peasant response which have often been attributed to peculiar motives presumed specific to peasants the model explains sluggish response to cash crops prices and high instability in perceived food and labor scarcities the key role of manufactured consumer goods prices in stimulating peasants effort in cash crops production the effectiveness of taxation as opposed to incentives in stimulating cash crops production and the key role of technological change in food production to enhance cash crop production results are obtained analytically in the case of one market failure and by numerical simulation with more than one

bad luck bad policy and learning a markov switching approach to understanding postwar u s macroeconomic dynamics abstract this paper evaluates the role of monetary policy in understanding the u s post war macroeconomic fluctuations we construct a medium size dsge model in which the central bank through a real time learning process can make mistakes in estimating key elasticities between macroeconomic aggregates and the central banks objectives may change over time the model also features time varying volatilities of non policy shocks we find that misperceptions of the persistence of inflation and the slope of the phillips curve could affect optimal monetary policy decision making therefore their accurate prediction is key for achieving successful monetary policy outcomes in addition we argue that the monetary policy shift geared toward inflation stabilization in the late 1970s changed the composition of output making the marginal efficiency of investment shock that proxies for the functioning of the financial sector the most important contributor to the business cycle

the value of screening mechanisms under alternative insurance possibilities abstract this paper investigates the welfare implications of symmetrical improvements in information and accompanying screening mechanisms which allow for improved matching of individuals to their respective risk classes unlike previous models used to investigate this phenomenon this paper allows for the possibility that individuals differ not simply according to exogenously specified unequal loss probabilities but rather that individuals possess different self protection technologies moreover various insurance contracting possibilities are also considered it is demonstrated that the structural form of the heterogeneity of technologies and the type of insurance contracts available in the market determine in an interactive way the value of information which improves the matching of individuals to risk class

a model for the federal funds rate target this paper is a statistical analysis of the manner in which the federal reserve determines the level of the federal funds rate target one of the most publicized and anticipated economic indicators in the financial world the paper introduces new statistical tools for forecasting a discrete valued time series such as the target and suggests that these methods in conjunction with a focus on the institutional details of how the target is determined can significantly improve on standard vector autoregression forecasts of the effective federal funds rate we further show that the news that the fed has changed the target has statistical content substantially different from the news that the fed failed to make an anticipated target change causing us to challenge some of the conclusions drawn from standard linear var impulse response functions

evidence on adverse selection equilibrium signaling and cross subsidization in the insurance market the configuration of equilibrium in the market for automobile collision insurance is examined empirically by representing the premium deductible menu and the demand function as a standard hedonic system using contractual data from a representative insurer we estimate a reduced form hedonic premium equation and the inverse of the marginal bid equation for insurance coverage the data reveal an equilibrium with adverse selection and market signaling but lead us to reject the hypothesis that high risks receive contracts subsidized by low risks

a nonparametric approach to expenditure constrained profit maximization a nonparametric approach to expenditure constrained profit maximization is developed a deterministic frontier profit function is constructed with and without expenditure constraints foregone profit is used as dual evidence for the existence of expenditure constraints individual evaluations on performance and expenditure constraints are produced empirical analysis is based on survey data for california rice farms seventeen of the eighty two surveyed farms experience profit loss as a result of expenditure constraints

multiple regimes in u s monetary policy a nonparametric approach we use two different nonparametric methods to determine whether there were multiple regimes in u s monetary policy over the period 1955 2003 we model monetary policy using two different versions of taylor s rule for the nominal interest rate target by contrast with parametric tests for regime changes the nonparametric methods we use allow the data to determine the dimensions on which to split the sample for purposes of estimating the coefficients of the taylor rule we find evidence for a few structural breaks and consistent agreement between our two nonparametric methods on the dating of those breaks

a generalized production frontier approach for estimating determinants of inefficiency in u s dairy farms this article investigates farm level efficiency of u s dairy farmers by estimating their technical and allocative efficiency technical inefficiency is assumed to be composed of a deterministic component that is a function of some farm specific characteristics and a random component by doing this we extend the stochastic frontier methodology in which determinants of technicial inefficiency are explicitly introduced in the model given the inputs variations in efficiency of farms are then explained by both deterministic and random components of technical inefficiency the empirical results indicate that a levels of education of the farmer are important factors determining technical inefficiency and b large farms are more efficient technically than small and medium sized farms both technical and allocative inefficiency are found to decrease with increase in the level of education of the farmer

factors affecting the technical efficiency among smallholder farmers in the slash and burn agriculture zone of cameroon abstract this paper estimates technical efficiency among small holder farmers in the slash and burn agriculture zone of cameroon and identifies sources of inefficiency using detailed survey data obtained from 450 farmers over 15 villages throughout 2001 2002 growing season we find that the mean levels of technical efficiency are 77 73 and 75 respectively for groundnut monocrop maize monocrop and maize groundnut farming systems suggesting existence of substantial gains in output and or decreases in cost with available technology and resources the efficiency differences are explained significantly by credit soil fertility social capital distance of the plot from the access road and extension services policy recommendations are drawn from these findings

term structure evidence on interest rate smoothing and monetary policy inertia abstract numerous studies have used quarterly data to estimate monetary policy rules or reaction functions that appear to exhibit a very slow partial adjustment of the policy interest rate the conventional wisdom asserts that this gradual adjustment reflects a policy inertia or interest rate smoothing behavior by central banks however such quarterly monetary policy inertia would imply a large amount of forecastable variation in interest rates at horizons of more than 3 months which is contradicted by evidence from the term structure of interest rates the illusion of monetary policy inertia evident in the estimated policy rules likely reflects the persistent shocks that central banks face

general equilibrium with parallel markets for goods and foreign exchange theory and application to ghana abstract this paper presents a simple model of a distorted economy with parallel markets which is motivated by the ghanaian experience the model has simultaneous illegal trade in goods and foreign exchange markets its general equilibrium determines the black market foreign exchange rate and the price of consumer goods after determining some comparative statics the predictions are tested on ghanaian monthly data from 1982 1983 the empirical results are shown to be consistent with those from the theoretical model

income portfolios in rural ethiopia and tanzania choices and constraints the article analyses the different income portfolios of households using survey data from rural ethiopia and rural tanzania it suggests that the different portfolios held by households cannot be e

the efficiency effects of categorical discrimination in the insurance industry recent public policy debate has focused concern on the equity dimensions of categorical discrimination based on sex age or race in insurance and similar markets we consider the efficiency effects of such discrimination and establish that costless imperfect categorization always enhances efficiency when categorization entails a nonnegligible resource cost however no unambiguous efficiency ranking of informational regimes is possible when categorization is costless we demonstrate that government having no better information than market participants can effect redistribution without assuming dictatorial control of the market implying that a market equilibrium with costless categorization is potentially pareto superior to one without it when categorization is costly however the market may categorize when pareto improvements are not possible

frontier production functions and technical efficiency a survey of empirical applications in agricultural economics abstract the modelling and estimation of frontier production functions has been an important area of econometric research during the last two decades forsund lovell and schmidt 1980 and schmidt 1986 present reviews of the concepts and models involved and cite some of the empirical applications which had appeared to their respective times of publication this paper seeks to update the econometric modelling of frontier production functions associated with the estimation of technical efficiency of individual firms a survey of empirical applications in agricultural economics is an important part of the paper

development of agriculture in ethiopia since the 1975 land reform abstract a stated objective of the ethiopian government since it came to power in 1975 has been to increase the production of crops for both domestic consumption and export consequently a number of plans and programs have been proposed and implemented to bring about such development in ethiopian agriculture this paper mainly focuses 011 a macro review of the general course of ethiopian agricultural development since the land reform of 1975 the food production in ethiopia has lagged behind the population growth as evidenced by the gap between the growth rates of population 3 and food production 1 8 over the period from 1970 to 1983 recently this situation has perhaps further deteriorated seventy one percent of the total land mass is estimated to be suitable for agriculture but only about 19 is cultivated this suggest an underutilisation of land moreover ethiopia has a persistent subsistence production problem in agriculture agricultural research and education which are essential to development have not been given due attention by the policy makers as a result the agricultural technologies used by farmers have changed little in this century moreover small scale farmers although still the most potent economic force in the country have not been given the incentives necessary to expand production and currently receive less than adequate support from the central government some 85 50 and 79 of total agricultural credit fertiliser and improved seeds respectively go directly to socialist enterprises state farms and producers cooperatives which up to 1985 have jointly accounted for only 5 of the total cultivated land and 4 of the national crop production the favouring of large scale and capital intensive state owned farming enterprises with credit subsidies and fiscal incentives while neglecting smallholders has contributed to the stagnation of agricultural production in ethiopia overall the analysis indicates that there has been no significant development of agriculture in ethiopia following the 1975 land reform

smuggling and supply response coffee in ethiopia abstract during the 1980s substantial smuggling of coffee has been taking place in ethiopia the recent devaluation has raised hopes that substantial quantities of coffee will flow back to the official channels in this study data on the incentives to supply to the different channels are collated a model of official supplies is formulated which nests an empirical test between the smuggling models by bhagwati and hansen 1973 and by pitt 1981 the econometric results favor the latter and show a small but significant effect of the premium in the black market and a positive total supply response relative to the main competing crop chat the results imply that the increases in export earnings from the devaluation will be quite limited

economic reform growth and the poor evidence from rural ethiopia abstract a new decomposition of poverty changes is developed to analyse the determinants of poverty changes during a period of economic reform 1989 1995 in villages in ethiopia poverty fell substantially but with diverse experiences across villages shocks mattered but the main factors driving consumption changes were relative prices changes resulting in changes in the returns to land labour human capital and location the experience of the poor is mixed one group of the poor in 1989 with relatively good land and location outperformed all other households while another group with much poorer endowments and location experienced virtually unchanged and persistent poverty

biased screening and discrimination in the labor market the traditional economic analysis of discrimination is based on gary becker s study of taste discrimination by employers employees and consumers more recent work by kenneth arrow 1972 1973 has attempted to interpret intergroup wage differences in an alternative framework as a rational reaction to uncertainty in labor markets his model of statistical discrimination demonstrates that when the screening process used to determine a worker s qualifications is costly and prior expectations of productivity differ across race or sex groups then wage differentials may arise between workers of identical productivity by implicitly assuming a perfect screening process arrow ignores a potentially important source of wage differentials namely the fact that the screening process might be a more reliable predictor of productivity for one group than for another our paper generalizes the arrow model in two ways first in contrast to arrow we assume that all groups have identical distributions of productivity secondly the screening process used by the firm to determine an applicant s productivity is biased in the sense that a members of various groups may pass the test in different proportions despite their identical productivity distributions and b the predictive power of the test might vary across groups our objective is to analyze the effects of these types of biases in the screening process on the wage differentials between different population groups