estimating residential water demand under multi part tariffs using aggregate data using a new model formulation and data from a sample of colorado utilities we investigated the price specification controversy marginal price versus average revenue when estimating residential water demand the improved statistical fit using average

the use of inputs by the federal reserve system reply in our 1983 paper we offered evidence that the law of demand operates inside the federal reserve in particular the fed faces a requirement that it return all revenues in excess of operating expenses to the treasury and this constraint lowers the price of amenities in terms of foregone profits the monetary authority accordingly buys more of the wage and nonwage perquisites of office than otherwise because we treated amenities as a monotone transformation of federal reserve system employment our theory suggested that the fed would pad its operating expenses by increasing the number of employees on its payroll moreover given that expansionary open market operations raise the interest income earned by the fed on its securities portfolio bureaucratic incentives would impart an inflationary bias to monetary policy in subsequent tests of the theory we found a positive and significant ceteris paribus relationship between changes in the monetary base and the size of the fed this result suggested that one motivation for expansions in the money supply is to finance the growth in the fed s bureaucracy we also found evidence that employment causes money in the sense of christopher sims 1972 but not the reverse and that the growth in fed employment over time does not appear to have been due to the fact that more people are required to manage larger money stocks in their comments john boyd and john strong suggest that there are methodological and empirical problems with our paper both comments focus primarily on the causality tests but each raises other issues designed to cast doubt on the strength of our results in what follows we discuss the main points raised by our critics i causality

the market value of outstanding government debt 1919 1975 abstract several new series on the market value of outstanding government debt are reported and their methods of construction described the new series on federal debt are compared with other existing estimates and are shown to be markedly superior to them

the effects of zoning on structure and land markets abstract zoning takes three general forms constraints on density lot size and allowable use this paper demonstrates that the three restrictions differ in their effects on structure and land markets density zoning is equivalent to a monopoly restriction that can be used to raise all land values allowable use restrictions affect land values differentially large lot restrictions affect the price for housing paid by individual households differentially considering externalities does not alter these basic differences the implications for empirical studies of zoning are discussed

how should control theory be used to calculate a time consistent government policy we study different solutions to a simple one dimensional linear quadratic game with a large number of private agents and a government a time consistent solution is defined as a solution to the hamilton jacobi bellman equation i e as a policy for which the government has noprecommitment capability this solution is compared to a policy where the government has an instantaneous pre commitment i e an equilibrium in which the government has a period by period leadership in both cases we show how control theory should be applied to calculate the equilibrium and how to relate these equilibria to the differential game literature

a note on price perception in water demand models a household s decision to acquire price knowledge is endogenous in the demand for utility services and may affect elasticities and consumption levels a simultaneous equation model with endogenous switching is developed to evaluate the effects of price

the federal reserve as a bureaucracy an examination of expense preference behavior in this paper the federal reserve system is viewed as a bureaucracy with a bureau s incentive to increase expenses beyond the profit maximizing point moreover the bureau consists of divisions the district banks that exhibit their own expense prefer ence behavior an empirical investigation of labor demand by the boar d and district banks reported in this paper demonstrates that the fed eral reserve has engaged in expense preference behavior and that the centralization of the monetary authority amplified this type of behav ior copyright 1988 by ohio state university press

electricity demand estimates under increasing block rates using price variables calculated at observed consumption levels this study finds significant bias in ordinary least squares estimates of price elasticities of electricity demand the bias is most severe for specifications using observed average price the finding is important for future econometric work since this type of rate structure is becoming more common the evidence indicates that inappropriate use of ordinary least squares ols overestimates that rate structure premium effect on demand and may underestimate the marginal price elasticity the use of an instrumental variables technique applied to actual rate schedules proves consistent parameter estimates regardless of the rate structure 20 references 3 tables

the market value of u s government debt monthly 1942 1980 abstract the market value of outstanding united states treasury debt is calculated on a monthly basis using price and par value data from the treasury bulletin separate series for treasury bills bonds certificates of indebtedness notes and total treasury debt are presented along with estimates of privately held treasury debt and gross federal debt the calculated market value series is compared to par value and an existing annual market value series

on the specification of price in studies of consumer demand under block price scheduling using a new model formulation and data from a sample of colorado utilities we investigated the price specification controversy marginal price versus average revenue when estimating residential water demand the improved statistical fit using average

privately operated water utilities municipal price negotiation and estimation of residential water demand the case of france this paper addresses the issue of price negotiation between a municipality and a private water utility operator and its implications for residential water demand estimation we use appropriate econometric procedures to estimate a water demand equation on a panel of french municipalities we find evidence that negotiated water price depends on municipality s characteristics causing endogeneity of price in the demand equation the impact of average household income housing and system features such as metering is investigated both on municipal consumption and price estimated price and income elasticities are significant and close to previous household level studies

inflationary bias of the federal reserve system a bureaucratic perspective abstract the federal reserve system does not receive a budget from congress but instead finances its operation from interest payments on its government security portfolio this peculiar financing arrangement provides the foundation for a bureaucratic model of federal reserve official behavior the empirical section tests the bureaucratic model by analysing the fed s expenditure record since 1947 and its policy actions during periods of constitutional revision

rent seeking over time the continuity of capture recently in this journal skaggs and wasserkrug 1983 presented a model of bureau monitoring and related it to federal reserve behavior central to their argument was that bureau constituencies may pressure congressmen in maintaining the monitoring status quo if competition is to be expected between self interested parties for the property rights associated with regulation and regulatory commissions then bureau monitoring or lack of it should have value the capture of a commission by others is made more costly when information on a bureau s activities is restricted in general the issues surrounding bureau monitoring bring out the dynamic nature of the capture theory of regulation once captured commissions must remain captured if benefits are to accrue to rent seekers over time empirical support for the capture perspective however only relates personal characteristics of the appointed regulators commissioners to characteristics preferred by the regulated to reveal the dynamic nature of capture one must also account for the continuity of commission membership a captured regulatory body can only remain captured if there is a continuity of desirable characteristics by compiling characteristics of appointed members previous studies have examined the output of the appointment process that resulted from competition for positions on regulatory boards however the lack of synchronization between appointments to federal regulatory commissions and presidential elections suggests that the distribution of influence among self interested groups in the selection process may vary over time thus continuous successful capture is more easily achieved if appointees remain on boards for full terms and if possible land reappointments but the process is complicated further because regulators

does the minimum lot size program affect farmland values empirical evidence using administrative data and regression discontinuity design in taiwan this study empirically assesses the causal effect of the minimum lot size program on farmland values in taiwan a unique dataset of 4 032 parcels of farmland drawn from administrative foreclosure auction profiles between 2000 and 2008 and regression discontinuity design were applied to cope with the endogeneity issue of land use regulations the results of the parametric and nonparametric estimations indicate that the minimum lot size program significantly increases farmland value by approximately 18 and 15 respectively moreover the program effect is more pronounced for farmland located in urban suburban areas in the absence of a tax effect and externality resulting from non agricultural activities the significant program effect on farmland values is likely to result from the effect of the program on farmland s option value for future development

central bankers bureaucratic incentives and monetary policy 1 central bankers bureaucratic incentives and monetary policy an introduction i structure of central bank financing and bureaucratic rents 2 monetary policy theory and practice 3 inflationary bias of the federal reserve system a bureaucratic perspective 4 preliminary evidence on the use of inputs in the federal reserve system 5 human capital and bureaucratic inertia the use of inputs by the federal reserve ii the organization of central bank bureaus and the problems of control 6 the choice of monetary instruments and the theory of bureaucracy 7 bureaucratic theory and the choice of central bank goals 8 research activities and budget allocations among federal reserve banks 9 banking sector influence on the relationship of congress to the federal reserve system iii political pressures bureaucratic incentives and monetary policy 10 politics and fed policymaking 11 central bank independence an international comparison 12 a private central bank some olde english lessons iv conclusion 13 central bankers and the issue of independence contributors

the economic consequences of regulatory taking risk on land value and development activity abstract in this paper the real options approach to land valuation is extended by i showing how land value may be adversely effected when localities threaten a regulatory taking with less than full compensation ii quantifying the resulting probability of development which may increase in an attempt to thwart the taking of development rights and iii measuring the value of lost income on an ex ante basis when an interim taking occurs we find that the economic impact of such regulation can be substantial which has implications for measuring just compensation claims as well as for general land use regulatory policy and related legal theory

agricultural land values and the value of rights to future land development we investigate the inuence of fu ture land development on current agricultural land values from a theoretical model of land markets we derive a reduced form expression for agricultural land values in terms of observable variables this result dictates the speci cation of our econometric model and we nd strong sup port for the model in an application to new york state the estimated model together with a spa tial interpolation algorithm is used to generate a surface of estimated development rights values for orange county this approach overcomes several problems that arise with the use of stan dard appraisal methods to value conservation easements jel q24

the use of inputs by the federal reserve system comment in a recent article in this review 1983 william shughart and robert tollison s t argue that an important motivation for expansion of the money supply is to finance the growth of the fed s bureaucracy specifically that the level of fed employment is a determinant of the nominal monetary base using a public choice framework they present a money supply equation which yields a positive and statistically significant relationship between the monetary base and the total employment of the federal reserve system while this conclusion is certainly interesting the analysis suffers from a number of important conceptual empirical and methodological problems shughart tollison point out that the revenue side of the federal reserve s budget is closely linked to its monetary policy operations through open market purchases of securities the fed generates a stream of interest payments because monitoring of this income stream is difficult and costly congress has elected to impose the constraint that excess revenues be returned to the treasury as a result the fed pays its current operating expenses out of this current interest income and then turns over the remainder to the treasury because the central bank cannot retain the profits it generates s t argue that the fed will exhibit a form of expense preference behavior in purchasing more amenities than are justified by costminimizing money production in particular by expanding fed employment in addition since expansionary monetary policy increases opportunities for this profit amenities tradeoff fed policies are likely to have a built in inflationary bias to test this hypothesis s t develop a regression model that estimates the monetary base as a function of fed employment real gnp a number of financial variables and linear and nonlinear time trend variables using annual time series data from 1915 to 1981 they find that the employment variable is a significant determinant of the money supply with their model explaining about 95 percent of the variation in the monetary base to check that employment causes monetary expansion and not the other way around s t employ the test of causality developed by c w j granger 1969 and christopher sims 1972 this test estimates two sided

bureaucracy altruism and monetary policy it has recently been argued that the fiscal relationship between the federal reserve and the treasury by which the fed keeps a portion of its earnings imparts an inflationary bias to monetary policy because that relationship gives the fed an incentive to increase its earnings by increasing the monetary base this hypothesis is tested within the framework of a federal reserve objective function incorporating bureaucratic and social goals and no evidence is found to support it

monetary policy theory and practice in respect of the theory of monetary policy i am reminded of the comment that jacob viner made many years ago at a meeting of the american economic association about alfred marshall s economics what is new is highly unlikely at this late date also to be true and significant 1 consequently i shall restrict my remarks on theory to trying to summarize what i regard as the present intellectual position

a discrete continuous choice approach to residential water demand under block rate pricing reply waldman is quite correct in noting that the microeconomic theory of block rate pricing in hewitt and hanemann hh 1995 is given for the general case of a k block rate structure whereas the econometric theory is largely confined to the case of exactly two blocks the extension in waldman to the more general case of k blocks is correct although the extension itself could be even more general if it addressed the nonnegativity of demand as is demonstrated below that no apparent attention was paid to the nonnegativity of demand in hh may be attributed to the fact that the need to do so was negated by a fortuitous assumption in the earlier work although that assumption that the errors are multiplicative and lognormally distributed was only maintained and not tested in hh i now estimate two models with the more common assumptions of linear demand and additive and normally distributed errors both with and without a modification for

zoning and the distribution of location rents an empirical analysis of harris county texas the coase theorem presents two criteria for evaluating regulation regulations efficiency relative to private solutions and how the regulation affects the distribution of wealth previous studies of the impact of municipal zoning have focused on coase s first criteria whether zoning raises land values overall this study estimates the transfer of wealth between owners of existing homes that results from the creation of a municipal zoning ordinance we find that property best suited to residential use gains in value while property with relatively higher potential as commercial property experiences a decline in the value we find that zoning is distributive

on the theory of growth controls numerous empirical studies have examined the effect of growth controls on housing prices these studies have used many different techniques ranging from hedonic price model estimation to paired comparisons but have all come to the same conclusion growth controls raise the price of housing in theory there are both demand and supply side explanations which need not be mutually exclusive for these observed price differences on the supply side housing caps zoning restrictions limitations on the amount of developable land and other forms of growth control may reduce the supply of housing over time this in turn may produce scarcity effects which manifest as shifts or other changes in the housing supply curve and attendant price increases on the demand side to the extent that growth controls may reduce or internalize expected negative externalities and or congestion costs associated with growth controls may also produce amenity effects such amenity effects manifest as changes in the demand curve and likewise may be capitalized in land values and wages e g the price of a house rises as commute time falls

alternate price specifications for estimating residential water demand with fixed fees using a new model formulation and data from a sample of colorado utilities we investigated the price specification controversy marginal price versus average revenue when estimating residential water demand the improved statistical fit using average revenue as the price variable was shown to be an artifact of the unitary elastic identity created when monthly rate schedules contain a fixed fee when the fixed fee was purged from the data average price was not significant but marginal price remained significant in the preferred double log marginal price model estimated price elasticity was 0 3 and conservation programs had no significant effect on water use

long run study of residential water consumption the estimation of dynamic models and themeasure of long run effects arerare in residential water demand studies weshow in this paper that a dynamicmodel of water consumption can be derived froma structural optimisation programsolved by local communities thisnonlinear model is estimated on asample of french municipalities and is foundasymptotically equivalent to a dynamic panel data model that is linear in theparameters the latter includes anoriginal error component structure that allowsfor a flexible heterogeneity pattern including both the usual idiosyncraticeffect and an additional individualeffect affected by a multiplicative time varyingparameter as usual gmm estimators for panel data are not consistent inthis case we propose a new gmmprocedure that yields consistent and efficientestimates of short and long runprice elasticities respectively 0 26 and 0 40

government borrowing and monetary accommodation this paper re examines the relationship between treasury borrowing and monetary growth examined previously with annual data by barro niskanen and hamburger and zwick our analysis based on quarterly data produces evidence of a positive and significant impact of total treasury borrowing upon the growth of the monetary base for the 1954 i 1961 ii and 1961 iii 1974 iv periods but an insignificant coefficient for the barro expenditure variable when the coefficient instability during the 1961 iii 1980 iv period is corrected by a dummy variable technique thy debt coefficient is positive and significant and remains stable for this two decade period

an empirical survey of residential water demand modelling abstract the increased reliance on demand side management policies as an urban water consumption management tool has stimulated considerable debate among economists water utility managers regulators consumer interest groups and policymakers in turn this has fostered an increasing volume of literature aimed at providing best practice estimates of price and income elasticities quantifying the impact of non price water restrictions and gauging the impact of non discretionary environmental factors affecting residential water demand this paper provides a synoptic survey of empirical residential water demand analyses conducted in the last 25 years both model specification and estimation and the outcomes of the analyses are discussed

bureaucracy altruisme and monetary policy a note from a forecasting perspective sets over the period 1916 1987 their structured critique is consistent with the earlier work of strong 1984 boyd 1984 allen mccrickard cartwright and delorme 1988 mester 1994 and others in general all question the findings of toma 1982 shughart and tollison 1983 boyes mounts and sowell 1988 and others that bureaucratic effects and institutional incentives have had a significant impact on the development and conduct of monetary policy an underlying issue in this debate is whether variables proxying bureaucratic or institutional effects emanating from the incentives contained in the structure

demand and distributional effects of water pricing policies abstract worldwide water scarcity threatens delivery of water to urban centers water pricing is often recommended to reduce demand in this paper demand and distributional effects of water pricing policies are examined in a block pricing model that is applied to the metropolitan region of sao paulo water demand functions are estimated using marginal and average price models based on monthly data for the period 1997 2002 price elasticities of water demand range between 0 45 and 0 50 and income elasticities between 0 39 and 0 42 for the current combined regressive progressive block price system the poor spend almost 4 2 to 4 7 of their income on water the rich only pay 0 4 to 0 5 of their income whereas they consume more than twice as much a progressive block price or an income dependent price system may result in a more equalized income distribution however the analysis shows that there is a trade off between a more equalized income distribution and revenues earned by the water company more pro poor pricing systems may result as well in lower revenues for the water company

specification of block rate price variables in demand models using a new model formulation and data from a sample of colorado utilities we investigated the price specification controversy marginal price versus average revenue when estimating residential water demand the improved statistical fit using average

price determinants of foreclosed urban land foreclosure proceedings are the primary cause of real estate auction sales in the us given the added legal constraints and risk associated with foreclosure proceedings it is an empirical question as to whether the resulting prices are a function of the usual underlying factors of physical characteristics locational benefits and neighbourhood effects which motivate normal market sale pricing using a hedonic pricing model common in the analysis of market sale prices we find systematically determined price behaviour which replicates market pricing

land values in a newly zoned city the introduction of a new zoning ordinance to chicago in 1923 offers a natural experiment that allows us to determine the effects of zoning on relative land value growth rates policymakers claimed at the time that land use zoning would raise aggregate land values by reducing negative externalities associated with mixed land use after controlling for initial land use and the endogeneity of zoning decisions we find that residential zoning led to higher land value growth rates than commercial zoning

price knowledge in household demand for utility services a household s decision to acquire price knowledge is endogenous in the demand for utility services and may affect elasticities and consumption levels a simultaneous equation model with endogenous switching is developed to evaluate the effects of price knowledge and other sources of heterogeneity results indicate informed households were more responsive to average and marginal price signals informed households also use less water but this is due to heterogeneity rather than price knowledge controlling for heterogeneity price knowledge actually increases monthly water usage the implications of accounting for differences in price knowledge in utility demand modeling and demand management policy are discussed

monetary aggregates as monetary targets a statistical investigation in this paper the authors analyze statistical properties of the monetary base m1 and m2 for the postwar u s data record the authors are specifically interested in answering three policy related questions first to what extent do these monetary aggregates contain information useful for predicting movements in prices and real output second how do the aggregates rank as to their predictive usefulness third how do these aggregates rank as to the stability of their relationship to the macroeconomy copyright 1992 by ohio state university press

historical considerations property rights and budgets a comment on the use of inputs by the federal reserve when considered in an alternative historical setting with a property right perspective the extended public choice model found in amcd offers strong confirmation for the s t view of monetary authority behavior

urban residential demand for water in the united states further discussion using a new model formulation and data from a sample of colorado utilities we investigated the price specification controversy marginal price versus average revenue when estimating residential water demand the improved statistical fit using average

large lot zoning and subdivision costs a test abstract this paper tests two hypotheses 1 that large lot zoning is a binding constraint on the residential land market and 2 that subdivision costs are inversely related to lot size the paper shows that in general the two hypotheses are not mutually exclusive but that they can be distinguished in the case of a test conducted across tracts of unsubdivided vacant land a hedonic price model for vacant land is developed and then estimated using disaggregate data from a new york city suburb

capitalization of exclusive agricultural zoning into farmland prices development in agricultural areas coughlin et al 1981 this exclusive agricultural zoning differs from traditional rural zoning in that it limits development and is often strictly enforced economists have argued that conceptually agricultural zoning lowers land values by restricting non farm development and three recent empirical studies support the hypothesis knaap 1985 vaillancourt and monty 1985 nelson 1988 but in fact economic theory predicts both positive and negative price effects distributed differentially among farmland parcels depending on parcel characteristics the purpose of this research is to test the hypothesis that the price effect of exclusive agricultural zoning varies with the characteristics of parcel subject to the regulations the research results suggest that economists investigating the land price effects of zoning should use methodologies that distinguish between positive and negative price effects deriving from parcel characteristics

central bank independence and macroeconomic performance some comparative evidence this note uses information on a sample of sixteen oecd countries to assess the relationship between central bank independence and macroeconomic performance as previous work suggests politically controlled central banks are more likely to pursue policies that lead to high and variable inflation however the authors find little evidence that political control of central bank policy has any impact on measures of the level or variability of growth unemployment or the ex ante real interest rate copyright 1993 by ohio state university press

deficits and money growth in the united states a comment joines 1985 argues that the federal reserve accommodates war induced deficit spending but not non war induced deficit spending using a first difference form of a reaction function to obtain a stationary time series of the monetary base we find that the federal reserve has accommodated federal government deficit spending in the post world war ii period

the influence of elections on federal reserve behavior a political business cycle is tested in a monetary reaction function positive evidence is a result of the 1930s and 1940s and not post war elections in addition there is no evidence of such a cycle in a rational expectations model

estimating demand under block rates electricity and water many empirical studies of the demand for electricity under declining block tariffs have been conducted but few have produced results consistent with traditional demand theory nordin bell j economics 7 719 21 1976 explains this in part by pointing out that most of those studies failed to take into account the income effects caused by intramarginal price differences the authors show here that nordin s suggestion involves the inappropriate use of ordinal level statistics ols they propose a method by which consistent estimates of the demand parameters can be obtained when a household s rule for selecting a block can be estimated 19 references 1 figure

the use of inputs by the federal reserve system an extended model recently it has been argued that bureaucratic incentives play an important role in the formulation of policy and the inflationary bias of the federal reserve system shughart and tollison 1983 hereafter s t 1 in particular s t maintain that the fed can retain profits denominated in amenities but not in dollars as a result of the congressional constraint that excess profits be returned to the treasury this constraint provides bureaucratic incentives for the fed to purchase more amenities than a for profit organization and ex plains s t 1983 291 in part the fed s apparent inflationary bias expansionary monetary policy then enlarges the fed s profit amenities choices and allows it to pursue its goal of bureaucratic enhancement s t assume that the dollar value of these amenities is a monotonic transformation of fed employment using this public choice framework they develop a model in which the monetary base is a function of a number of variables including employment in the federal reserve system sysemp

the use of inputs by the federal reserve system comment in a recent issue of this review 1983 william shughart and robert tollison s t hypothesize that the fed pursues a bureaucratic objective which results in an inflationary bias in monetary policy they test this hypothesis empirically and conclude that it is supported by the data this comment however shows that their statistical procedures are flawed and when corrected provide little support for the inflationary bias theory the data actually suggest a different but not very interesting or surprising interpretation

comparing residential water demand estimates under decreasing and increasing block rates using household data using a new model formulation and data from a sample of colorado utilities we investigated the price specification controversy marginal price versus average revenue when estimating residential water demand the improved statistical fit using average

welfare and distribution effects of water pricing policies in this paper distribution and welfare effects of changes in block price systems are evaluated a method is discussed to determine for a marshallian demand function equivalent variation in case of a block price system the method is applied to compare for the metropolitan region of sao paulo alternative pricing policies on the basis of their demand welfare and distribution effects of changing water prices results show that there is a trade off between average welfare and income distribution a pro poor price system may result in lower average welfare than a flat price system but in higher individual welfare for the poor moreover there is a trade off between revenues for the water company and income distribution even though pro poor price systems may not be as good for average welfare as flat price systems their direct effects on poverty are important introducing pro poor price systems however may have financial consequences for the water companies

an analysis of minimum frontage zoning to preserve lakefront amenities the development of lakefront property in northern wisconsin has prompted in several towns minimum frontage zoning stricter than the state standard such zoning generates an economic loss by constraining development development effect and an economic gain by preserving environmental amenities amenity effect estimation of a hedonic price function for lakefront property in northern wisconsin quantifies these competing effects the estimation indicates that at the current margin the economic loss from the development effect is negligible and the economic gain from the amenity effect may be considerable raising frontage prices by an average of 21 5

do agricultural land preservation programs reduce farmland loss evidence from a propensity score matching estimator more than 80 governmental entities concerned about sprawl open space and farmland have implemented purchase of development rights pdr programs preserving 2 23 million acres at a cost of 5 47 billion are pdr programs effective in slowing the rate and acres of farmland loss employing propensity score matching methods and a 50 year 269 county data set for six mid atlantic states we find empirical evidence that pdr programs have had a statistically significant effect on farmland loss having a pdr program decreases a county s rate of farmland loss by 40 to 55 and decreases farmland acres lost by 375 to 550 acres per year

an econometric estimation of industrial water demand in france this study investigates the structure of industrial water demand byestimating the derived demand for water on a sample of industrialestablishments located in the south west of france productiontechnologies are represented by short term variable cost functions andapproximated by a translog form industrial water use is modeled ashaving three components the quantity of water bought to a waterutility the quantity of autonomous water and the quantity of watertreated prior to use we include in this framework water effluents which are considered as a by product of the production process emittedby firms each of the three water components is treated as a separateinput and all are estimated as a system of simultaneous equations themodel is estimated on a sample of 51 industrial plants in the girondedistrict observed from 1994 to 1996 using seemingly unrelated regression sur and feasible generalized least squares fgls results ofestimations show that industrial firms are sensitive to water priceinputs network water elasticity is estimated at 0 29 it variesfrom 0 10 to 0 79 according to the type of industryconsidered autonomous water price elasticity is not significant elasticity for treated water is evaluated at 1 42 at themean sample and varies from 0 90 to 2 21 according to theindustry considered

growth controls real options and land development abstract many urban growth controls attempt to check sprawl by restricting allowable new housing densities however land may be undeveloped to preserve its real option value real options in land markets arise from uncertainty as to the optimum use of a site by limiting allowable development choices growth controls can narrow real options and potentially accelerate investment this paper examines the effect of price volatility a generator of option value on the timing of development after the imposition of an urban growth boundary ugb around seattle while the net effect of the ugb is to lower the likelihood of new housing outside the boundary by between 28 and 39 price volatility is no longer a deterrent to development

monetary policy signaling from the administration to the federal reserve this chapter employs the index of monetary policy signaling from the administration to the federal reserve safer that was developed in chapter two the safer index is a simple weekly sum of articles that appeared in the wall street journal in which administration officials expressed a desire for easier 1 or tighter 1 monetary policy a key assumption is that systematically over time the financial media capture the essence of communication that is going on between the executive branch and federal reserve officials 1 the signaling index is employed in ordinary least squares regressions for the period from january 1964 to november 1991 cumulative values of the safer index over a three week period as an explanatory variable are found to have a statistically significant effect on the average federal funds rate during the third week as the dependent variable further evidence suggests that the safer index is granger causal with respect to the federal funds rate after classifying the signals by sources within the administration oval office council of economic advisers treasury and other and unidentified sources it is shown that for the overall 1964 1991 period signals from the treasury department and from other and unidentified sources have a statistically significant effect on the federal funds rate while signals from the oval office and the council do not when the data are segmented according to who was the chairman of the federal reserve board at the time ordinary least squares results indicate that the federal reserve did not systematically respond to executive branch signaling in a statistically significant way when william mcchesney martin g william miller and alan greenspan were chairmen but did respond statistically significantly to administration signaling during portions of the periods during which arthur burns and paul volcker were chairmen

do zoning regulations rob rural landowners equity zoning regulations are land use control tools used to conserve resource land limit negative externalities from high density development and achieve agglomeration benefits from conserving large blocks of land however the passage of low density zoning is often challenged by landowners who claim that through it they lose their land s equity due to lower land values we investigate whether low density zoning impacts rural land value using arm s length sales in maryland s nine eastern shore counties using both a propensity score matching method and an instrumental variable approach we find that low density zoning has differentiated impacts resource parcels land values are unaffected and non resource parcels values decrease by 20 50

instrumental variables approach to rural water service demand interest in empirical studies of the demand for goods sold through discrete pricing structures has grown since nordin suggested a modification of taylor s demand model 24 29 the bulk of early empirical research centered on residential electricity demand however econometric studies of water demand have proliferated in recent years some articles have been concerned in part with the proper theoretical specification of demand equations incorporating block rate pricing schedules taylor specified price as being composed of the marginal price associated with the block in which consumption occurs and an average price 29 nordin modified taylor s specification by demonstrating utility maximizing consumers with perfect information respond to marginal price along with a lump sum income effect associated with intramarginal prices and price schedule breakpoints 24 there is a potential problem in the estimation of demand for goods sold through block rate pricing schemes because of the possibility of correlation between price variables and the error structure 29 there are then two issues associated with the study of demand for goods sold under discrete pricing mechanisms the first issue is whether if consumers are aware of block pricing structures and respond to marginal price and the lump sum income change or rate premium or are aware of only total spending and total consumption and respond to an average price 11 5 9 26 the second issue is the choice of estimating technique 4 14 20 31 25 these two issues are not unrelated since empirical validation of consumer behavior

the value of free water analyzing south africa s free basic water policy this paper analyzes south africa s free basic water policy under which households receive a free water allowance equal to the world health organization s recommended minimum of 6 kiloliters per month i structurally estimate residential water demand evaluate the welfare eects of free water and provide optimal price schedules derived from a social planner s problem i use a unique dataset of monthly metered billing data for 60 000 households for 2002 2008 from a particularly disadvantaged suburb of pretoria the dataset contains rich price variation across 18 dierent nonlinear tarischedules and includes a policy experiment which removed the free allowance i nd that without government subsidy the mean monthly consumption would decrease from 12 6 to 5 6 kiloliters which is below the clean water consumption recommended by the who however it is possible to reallocate the current subsidy to form an optimal tari without a free allowance which would increase welfare while leaving the water provider s revenue unchanged this optimal tariwould also reduce the number of households consuming below the who recommended level

household responses to increased water rates during the california drought this paper explores the use of fixed effects and maximum likelihood techniques to es timate household responses to water price in creases during the california drought estimates are based on bimonthly meter readings from 599 single family households in the alameda county water district over the period 1982 1992 before and after the introduction of a steeply increasing block rate price structure i find that household and monthly fixed effects models are not success ful in modeling water demand with these data however maximum likelihood models that ex plicitly consider the household s response to the rate structure result in plausible estimates of wa ter demand jel q25

factors affecting monetary policy in an era of inflation abstract a money supply reaction function is developed and estimated within the context of an is lm framework to test the responsiveness of the federal reserve to the government budget restraint and certain parameters of the model the results reveal that a large portion of the recent expansion of the monetary base may be attributed to increases in government debt and provide an essential first step in quantifying the inflationary impact of deficits the monetary base is also expanded in response to increases in inflationary expectations and previous increases in the monetary base but is not statistically correlated to changes in the unemployment rate or potential national income or to rises in interest rates caused by sources other than higher inflationary expectations previous monetary policy or the treasury borrowing requirement

evidence on the specification of price in the study of domestic water demand the development of lakefront property in northern wisconsin has prompted in several towns minimum frontage zoning stricter than the state standard such zoning generates an economic loss by constraining development development effect and an economic

deficits and money growth in the united states 1872 1983 abstract this paper reports empirical evidence on the relation between government budget deficits and the growth of high powered money in the united states high powered money growth appears to be positively related to war spending during periods when such spending is a substantial fraction of gnp there is little evidence that the growth of high powered money is related to the non war government deficit measured either in cash or in real terms after controlling for the level of overall economic activity

on stabilization plans and central bank independence we argue that the benefits of appointing an independent central banker may go beyond low inflation rates within a government debt stabilization framework and with a decentralized policy making where the government acts as a stackelberg leader delegating monetary policy to an indepenent authority monetary policy to an independent authority turns out to be a discipline for the government and overall this leads to better results

the qualitative economics of development control abstract this paper examines space supply restrictions and containment policies in the context of a monocentric urban model with several classes results are obtained concerning the qualitative effects of such policies on space i e land values and locations of the various groups

residential water demand in the northwest of spain a panel of monthly aggregate data from the northwest of spain is used to estimate domestic water demand functions under linear and non linear tariffs price billing climatic and sociodemographic variables are used as explanatory variables the use of intraannual data constitutes a relevant contribution in the european context overall marginal price elasticity estimates lie between 0 12 and 0 17 summer only elasticities and elasticities associated with uses beyond the effectively free allowances seem significantly higher climatic variables significantly affect monthly use although probably less than in other wealthier and drier areas domestic water use appears to be a normal good

credibility and stabilization the paper deals with stabilization as a one shot problem to ask what credibility means in a world where programs will succeed with probability one a model is spelled out where the equilibrium program has some ex ante probability of failure the model draws attention to the factors that raise or lower the probability of success of a stabilization program and thus offers a positive theory of stabilization reputation that emerges as a central element in repeated games has no role in this model

the impact of nearly universal insurance coverage on health care utilization evidence from medicare the onset of medicare eligibility at age 65 leads to sharp changes in the health insurance coverage of the u s population these changes lead to increases in the use of medical services with a pattern of gains across socioeconomic groups that varies by type of service while routine doctor visits increase more for groups that previously lacked insurance hospital admissions for relatively expensive procedures like bypass surgery and joint replacement increase more for previously insured groups that are more likely to have supplementary coverage after 65 reflecting the relative generosity of their combined insurance package under medicare