long live the doge death as a term limit on venetian chief executives can an electorate use the projected life expectancy of a lifetime appointed chief executive to enforce binding informal term limits informal term limits based on the life expectancy of a chief executive candidate at election would enable an electorate to exercise discretion in adjusting tenure lengths to minimize expected turnover and tenure length costs while also providing a strictly binding term limit death we provide a detailed historical case study of venice from 1172 to 1797 when the ruling patricians utilized informal term limits on their chief executive the doge relying on the projected life expectancy of ducal candidates

shirking and sorting in a political market with finite lived politicians this paper analyzes principal agent slack in the context of a political market composed of voters challengers and incumbents the introduction of a last period via finite livedness in combination with voters imperfect information about politicians preferences causes time varying shirking behavior on the part of politicians political markets eventually sort out those politicians with significantly deviant policy preferences potentially providing a solution to the last period problem and enabling politicians to make credible commitments in the extreme sorting can insure that it is not worthwhile for potential shirkers to run for office a systematic relationship between political shirking and number of terms in office may exist and depends on how quickly sorting takes place we show that evidence of little if any shirking is quite consistent with politicians having diverse and strongly held policy preferences in addition if sorting is a significant feature of political markets cross sectional studies will tend to oversample little and non shirking politicians compared to longitudinal studies reinterpretations of existing empirical work are also discussed

exchange rate volatility and foreign trade evidence from thirteen ldc s this article investigates empirically the impact of real exchange rate volatility on the export flows of 13 less developed countries ldc s over the quarterly period 1973 1996 estimates of the cointegrating relations are obtained using johansen s multivariate procedure estimates of the short run dynamics are obtained for each country using the error correction technique the major results show that increases in the volatility of the real effective exchange rate approximating exchange rate uncertainty exert a significant negative effect on export demand in both the short run and the long run in each of the 13 ldc s these effects may result in significant reallocation of resources by market participants

the impact of exchange rate volatility on international trade reduced form estimates using the garch in mean model abstract in this paper we use a multivariate garch in mean model of the reduced form of multilateral exports to examine the relationship between nominal exchange rate volatility and export flows and prices the model imposes rationality on perceived exchange rate volatility unlike conventional two step strategies tests are performed for five industrialized countries over the post bretton woods era we find that the garch conditional variance has a statistically significant impact on the reduced form equations for all countries for most of the countries the magnitude of the effect is stronger for export prices than quantities in addition the estimated magnitude of the impact of volatility on exports is not robust to using the conventional estimation strategy jel f41 f31

dynastic political privilege and electoral accountability the case of u s governors 1950 2005 i introduction political dynasties which pass on public offices and other political privileges from family member to family member have been important in the united states throughout its history this paper investigates whether dynastic political privilege enhances incumbent accountability to voters as incumbents with family political capital work to maintain favorable reputations even in the incumbents last period this would mitigate last period problems in contrast with earlier empirical results in which incumbents in their last period in office deliver inferior economic results we test the hypothesis that dynastic political privilege increases accountability using data for 1950 2005 on u s governors including a new data set on the family relationships of politicians the constitution of the united states embodies the political ideals of the founders whose goal was to establish a republican national government that was responsible to the nation s people that specified the powers of the federal government that recognized the rights of the states and that incorporated checks and balances which would limit governmental power this new government was to be a direct contrast to and repudiation of monarchy in one of the most explicit repudiations of monarchy the constitution forbids the grant of titles of nobility by both the federal government and the states constitution of the united states article i sections 9 and 10 see the federalist papers number 39 for james madison s statements on the most decisive importance of the ban on titles of nobility library of congress 1961 242 interestingly however the constitution does not directly forbid hereditary office provided that the inheritor of the office is elected to it or appointed to it by constitutional means for example early in the nineteenth century the nation elected john quincy adams son of the second president as its sixth president dal bo dal bo and snyder 2009 carefully examine u s congressional dynasties from 1789 to 1996 and find that political power in the united states is self perpetuating this seems not only contrary to our nation s fundamental political principles but it also seems to hand over opportunities for rent seeking to relatives of successful politicians furthermore it is inefficiently anticompetitive because under such a system many highly qualified candidates are frozen out of office for reasons other than qualifications and anticipated productivity in office thus at first glance this process of family privilege in politics appears repugnant and contrary to the republican principles of our national political system there are however at least two other views of inherited political privilege which see it as socially useful first it is possible that political skills are actually inheritable so that dynastic political privilege may be socially productive that is relatives of office holders may gain special access to knowledge and skills that is only available to other potential office holders at much higher cost if at all the second and perhaps more important way in which inherited political privilege could be socially productive is that it may mitigate public sector principal agent problems the political system of the united states presents substantial principal agent problems as the voters cannot directly control the behavior of incumbent officials this gives office holders opportunities to act against the voters interests through corruption shirking on the job consumption at public expense promoting narrow ideology and others dynastic political privilege may make these behaviors more costly the possibility that opportunistic behavior in office may damage other family members political prospects disciplines current office holders making them more likely to exercise care in serving their constituents interests the main mechanism for voters to discipline incumbents is through elections

the effects of exchange rate volatility on exports some new estimates investigations of the impact of exchange rate volatility on exports have not allowed for the integrated non stationary of the variables employed in estimation the results reported in this note are suggestive that in the context of an error correction framework real exchange rate volatility has a significant impact on exports

adoption of agricultural innovations in developing countries a survey this paper reviews various studies which have provided a description and possible explanation to patterns of innovation adoption in the agricultural sector the survey points out that the tendency of many studies to consider innovation adoption in dichotomous terms adoption nonadoption may not be appropriate in many cases where the actual decisions are defined over a more continuous range more attention needs to be given to the socio cultural and institutional environment in area studies so that their interrelation with economic factors affecting adoption can be inferred the presence of several interrelated innovations is another aspect that needs to be considered more carefully in future research since a number of simultaneous decisions may be involved furthermore the possibility of regular sequential patterns in adopting components of a new technological package should be specifically addressed in future studies finally the impact of differential adoption rates on land holding distribution merits attention in future research

insurance market efficiency and crop choices in pakistan this paper tests the efficiency of insurance markets in the pakistan punjab by examining how crop choices are affected by the presence of price and yield risk we estimate reduced form and structural models of crop choices although we cannot reject the hypothesis that village members efficiently share risk among themselves production choices are shown to depend on risk existing risk sharing and selfinsurance mechanisms thus imperfectly protect punjab farmers against village level shocks results also indicate that households respond to consumption price risk thereby suggesting that empirical and theoretical work on risk should avoid putting an exclusive emphasis on yield and output price risk

does electoral accountability affect economic policy choices evidence from gubernatorial term limits this paper analyzes the behavior of u s governors from 1950 to 1986 to investigate a reputation building model of political behavior we argue that differences in the behavior of governors who face a binding term limit and those who are able to run again provides a source of variation in discount rates that can be used to test a political agency model we find evidence that taxes spending and other policy instruments respond to a binding term limit if a democrat is in office the result is a fiscal cycle in term limit states which lowers state income when the term limit binds

are currency devaluations effective a panel unit root test abstract using a panel unit root test with real exchange rate volatility measures this paper shows that currency devaluation leads to a short run contractionary effect for the crisis affected asian economies in addition devaluation is ineffective in the long run in influencing aggregate output

risk efficiency and the adoption of modern crop varieties evidence from the philippines efficiency among farmers of less developed countries has been the focus of numerous studies since t w schultz hypothesized that farmers in developing agricultures are poor but efficient 1 a growing body of literature supports schultz s argument that farmers in developing agricultures have low incomes not because they use their resources inefficiently but because they lack the technology and resources they need to realize higher productivity and thus higher incomes a high priority in agricultural development assistance since the 1960s has been the generation of technology that would enable farmers to increase their productivity much research has been devoted to the causes of low agricultural productivity and the longer term productivity gains that may be forthcoming from modern technology but less attention has been devoted to the process of technology adoption by low income farmers as noted in the recent survey of adoption of agricultural innovations by g feder r e just and d zilberman there have been efforts to model adoption in the context of risk but there is a dearth of empirical evidence on the ways that farmers respond over time as a new production technology is introduced in a risky environment 2 in this article we address the empirical analysis of technical efficiency as farmers adopt new production technology taking into account production risk and learning we utilize recently developed efficiency criteria applicable when production is risky and implement these criteria using an approximation to a representative farmer s decision model 3 pooled time series and cross sectional data collected by the international rice research institute are used to investigate the

heteroscedasticity or production risk a synthetic view two veins of literature namely production risk literature and stochastic frontier analysis are examined both fields are concerned of output variation the former due to exogenous shocks the latter due inefficiency by covering the literature from both the fields this review suggests that the concept of heteroscedasticity can be utilized to build a synthesis between these mainly separate branches of literature however the synthetic approach brings a challenge how to differentiate between different sources of output variation this challenge is identified as the main obstacle to meaningfully combine the two approaches

econometric estimation of producers risk attitudes general methods are proposed for the identification and econometric estimation of the parameters of the distribution of risk attitudes in a producer population the proposed methods also provide the basis for the development of statistical tests of model specification and of behavioral hypotheses econometric risk attitude estimation is shown to be possible under less restrictive conditions than previously believed a moment based version of the general model is applied to indian data and the econometrically estimated risk attitudes are presented and compared to experimental results for a similar group of producers

attendance rates political shirking and the effect of post elective office employment attendance rates political shirking and the effect of post elective office employment i introduction political shirking the degree to which a politican s actions deviate from the wishes of his constituents can take many different dimensions economists e g amacher and boyes 1978 davis and porter 1989 dougan and munger 1989 kalt and zupan 1984 lott 1987d nelson and siberberg 1987 and peltzman 1984 have debated whether shirking exists in how a politician votes when he does vote this divergence is measured through some particular special interest voting ratings e g american conservative union americans for democratic action etc however shirking can obviously take as many forms as there are outputs that a politician produces besides how he votes he also produces services for his constituents involving everything from being personally available to listen to the constituents grievances to ensuring effective handling of case work by his staff see for example fiorina 1977 fenno 1978 and cain et al 1987 1 one dimension that has not been sufficiently examined is the extent to which politicians shirk by failing to vote on pending legislation 2 no attention has been given to which mechanisms will make this particular type of shirking relatively more costly most economists agree that opportunitic behavior by politicians is limited by the threat of reelection e g amacher and boyes 1978 barro 1973 kalt and zupan 1984 nelson 1976 and telser 1976 3 by implication the level of shirking should be the greatest when a politician decides to leave office however this opportunistic behavior might be reduced to the extent that political parties or constituencies impose costs for shirking through affecting politicisns post elective office career or the careers of their children thus a politicians last term in elective office may not represent his last period in any meaningful sense the next section outlines the differing views on how politicians act when they no longer face the threat of reelection section iii describes some empirical evidence on what mechanisms may prevent this last period problem the final section discusses the impliactions of these results ii the last period whether economists view politicians as ideologues e g kau and rubin 1979 and kalt and zupan 1984 or as simply attempting to maximize political support e g barro 1973 ferejohn 1986 nelson 1976 and peltzman 1984 the threat of reelection is seen as preventing shirking as kalt and zupan 1984 298 phrase it it appears that the proximity of the next election inhibits ideological shirking even those who do not view the last period as affecting how a politician votes argue that it will affect how often he votes lott 1987a 1987b has argued that if voters can determine and elect politicians that have ideological preferences corresponding exactly to the wishes of constituents politicians voting patterns should continue to reflect those values even when the cost of shirking in terms of forgone future votes is low the penalty to ideologues of not votingfor their constituency in the last period when they no longer face reelection is the forgone utility from not doing what they personally value assuming that politicians also desire leisure politicians should continue to vote for what they believe in but they should vote less frequently since they no longer receive the additional return of larger future support mechanisms to overcome this last period problem have been suggested by becker and stigler 1974 9 10 they argue that opportunistic behavior can be controlled if officeholders face the loss of a pension or equivalently a posted bond in the event of opportunistic behavior in their last term however the actual pension system does not effectively eliminate the last period for politicians since retirement payments are not based on cheating in the last period

term limits time horizons and electoral accountability term limits have been known to reduce electoral accountability by removing the possibility of reelection thus affecting economic policy choices i e the lame duck effect we show that the magnitude and statistical significance of this effect is influenced by the expected length of a future career by using incumbent age as a proxy for expected career length we find that the lame duck effect is statistically observable only among those politicians with long careers ahead using data on us governors from 1950 to 2005 we find evidence that the influence of term limits is heterogeneous primarily influencing young incumbents who hope to have long careers and thus have stronger incentives to remain accountable to voters indeed we find little evidence of a lame duck effect among older incumbents suggesting that their already shortened time horizons may offset the term limit effect

incumbent performance and electoral control in the pure theory of electoral competition citizens compare the platforms of the candidates and vote for the one whose platform is preferred candidate strategies are identified with promises about future performance in office models of this sort have been developed in both static mckelvey 1975 and dynamic kramer 1977 i settings and all appear to have the property that if the set of alternatives is large enough in some sense equilibrium platforms rarely exist but these models have another feature that is quite as disturbing as their instability in the static setting discussed by mckelvey little attention is paid to the possibility that once in office the politician s preferences may diverge from those of his constituents and that he may therefore choose policies at variance from his platform instead it is simply assumed that promises will be kept whether or not such behavior is congruent with the interest of the officeholder it is sometimes argued that an enforcement mechanism may exist to discipline politicians for failing to keep promises but without a specification of the mechanism it is not obvious that it would be in the interests of the

export promotion through exchange rate policy exchange rate depreciation or stabilization exchange rate movements affect exports in two ways rate depreciation and rate variability risk a depreciation raises exports but the associated exchange rate risk could offset that positive effect the present paper investigates the net effect for eight asian countries using a dynamic conditional correlation bivariate garch m model that simultaneously estimates time varying correlation and exchange rate risk depreciation encourages exports as expected for most countries but its contribution to export growth is weak exchange rate risk contributes to export growth in malaysia and the philippines leading to positive net effects exchange rate risk generates a negative effect for six of the countries resulting in a negative net effect in indonesia japan singapore and taiwan and a zero net effect in korea and thailand exchange rate movements affect exports in two ways rate depreciation and rate volatility risk the two effects have received considerable attention since the collapse of fixed exchange rates in the early 1970s but no research considers the net total effect on exports of the two potentially offsetting effects this paper investigates the net effect for eight asian countries with engle s 2002 dynamic conditional correlation dcc bivariate garch m model that simultaneously estimates time varying correlation and exchange rate risk the net effect relates to the goal of a foreign exchange intervention depreciation lowers the foreign currency price of exports and probably increases the quantity of exports and export revenue in domestic currency conditions may exist however where export revenue falls highly inelastic foreign import demand leads to falling export revenue ambiguity also arises if export production incorporates high import content since the domestic cost or price of exports rises with depreciation during periods of appreciation exporters might price to market lowering their domestic currency price to maintain export market share theory and empirical evidence exhibits ambiguity as to the effect of the exchange rate on exports and export revenue junz and rhomberg 1973 and wilson and takacs 1979 find that devaluation

production risk and optimal fertilizer rates a random coefficient model risk as an impediment to progress is a recurrent theme among development practitioners wharton galbraith lipton in the context of the new rice technology it has been argued that the full potential of modern varieties mvs has not been realized because year toyear variability in crop response has caused farmers to use less than the economically optimal level of inputs barker et al over the years a growing body of literature has emerged quantifying the effect of risk aversion on input use particularly fertilizer the evidence is conflicting and the controversy continues while moscardi and de janvry and ryan and perrin conclude that risk aversion substantially lowers input levels roumasset and rosegrant and herdt show that the low observed levels of input use cannot be attributed to risk

production risk risk aversion and the determination of risk attitudes among spanish rice producers agricultural production is subject to risk and the attitudes of producers toward risk will influence input choices insofar as these affect production risk risk attitudes in turn may be affected by certain socioeconomic characteristics of producers using 2004 survey data from a cross section of 130 spanish rice farms we estimate risk aversion coefficients of farmers and investigate the influence of a series of socioeconomic variables on their risk attitudes our results show that farmers exhibit risk averse behavior and that risk attitudes are related to a series of socioeconomic characteristics in particular the belief that the farm will continue after the producer retires is found to increase the degree of risk aversion while age is found to have nonlinear effects on risk aversion off farm income especially from nonagricultural activities is found to reduce risk aversion neither the educational level of the producer nor the presence of dependents on the household is found to have an effect on risk preferences regarding the production technology we find that land labor and fitosanitary products are risk reducing inputs whereas capital seeds and fertilizer all increase risk

favorite sons intergenerational wealth transfers among politicians in this paper we investigate the degree of occupational following in politics and its impact upon the career success and behavior while in office of both sons and fathers we find that sons follow into their politician fathers footsteps to a degree surpassed in the general population only among farmers and self employed proprietors there is substantial indirect evidence which suggests that following is motivated to a large extent by the transfer of valuable name recognition and voter loyalty

technological change and risk management an application to the economics of corn production the paper investigates the linkages between technological change and production risk with an application to corn the effects of technology on risk exposure are analyzed we define technological progress to be risk increasing risk decreasing if it increases decreases the relative risk premium the analysis is applied to panel data from wisconsin research stations conditional moments including mean variance and skewness of corn yield grain moisture and corn profit are estimated for different sites we investigate how the trade off between expected return and the risk premium varies over time and over space the empirical results indicate that technological progress contributes to reducing the exposure to risk as well as downside risk in corn production although this effect varies across sites they also stress the role of the relative maturity of corn hybrids as a means of managing risk

a century long perspective on agricultural development this article strategically surveys the past century s literature on agricultural development we organize the discussion around three grand themes that reveal the richness of agricultural development as an intellectual endeavor first we explore the role of agriculture in the broader development process from a macroeconomic and political economy perspective we then examine the role of technological and institutional change in successful agricultural development finally the focus turns to a microeconomic perspective on agricultural household decision making and the problems of imperfect and missing markets asymmetric information and transactions costs that lead to widespread apparent inefficiency and disequilibrium

time to change what to sow risk preferences and technology adoption decisions of cotton farmers in china this paper examines the role of individual risk attitudes in the decision to adopt a new form of agricultural biotechnology in china i conducted a survey and a field experiment to elicit the risk preferences of chinese farmers who faced the decision of whether to adopt genetically modified bt cotton a decade ago in my analysis i expand the measurement of risk preferences beyond expected utility theory to incorporate prospect theory i find that farmers who are more risk averse or more loss averse adopt bt cotton later farmers who overweight small probabilities adopt bt cotton earlier

pesticides productivity and farmer health a philippine case study health is recognized as one of the most important components of the human capital of rural people in developing countries there is a growing body of literature showing the productivity effects of health associated with nutrition e g bliss and stern 1978 strauss 1986 deolalikar 1988 pitt rosenzweig and hassan 1990 in this literature the productivity effects of health are inferred either by correlating health indicators with wages or by including health indicators in an agricultural production function the human capital literature also has demonstrated that farmer education plays an important role in the allocative and technical efficiency of farmers welch 1970 schultz 1975

farmer to farmer transfer of new crop varieties an empirical analysis on small farms in uganda farmer to farmer transfer or dissemination of technologies is a neglected area of research even though successful diffusion of many researcher and farmer developed technologies is highly dependent upon farmers private initiatives this is particularly true in many developing countries where formal market mechanisms used in dissemination are often ineffective successful dissemination of new technologies to marginal farmers require greater knowledge and use of indigenous dissemination methods the determinants of farmer to farmer transfer of new bean varieties experimented with by small scale farmers in uganda are investigated farmers were experimenting with new varieties received through earlier on farm trials and were transferring small quantities of grain to other farmers for experimental purposes on farm trials may thus be an effective but limited method for diffusing new varieties factors directly associated with the transfer decision were farm size and variables identifying a willingness to experiment with new varieties the production risk reducing strategies of intercropping and sowing of a larger number of non climbing bean varieties were negatively associated with the probability to transfer grain the quantity of grain available to transfer was not associated with the transfer decision farmers were not transferring grain of the five varieties at different rates even though significant differences in yield were found

the role of exchange rates in a popular model of international trade abstract this paper examines the empirical relationship between the real effective exchange rate and the aggregate real trade balance for five major oecd countries in the post bretton woods era a variety of parametric and non parametric techniques are used there is little evidence that the exchange rate significantly affects the trade balance

consequences of a coexistence policy on the adoption of gmht crops in the european union this article examines the adoption of genetically modified herbicide tolerant gmht crops in the european union eu prior to its commercial release a set of potential drivers including the implementation of coexistence measures by farmers farmers own motivational factors e g economic environmental and technical factors and perceived social pressure to accept or reject adoption may influence european union farmers willingness to adopt gmht oilseed rape and gmht maize the analysis includes economic and sociological factors results show that coexistence measures may hamper gmht adoption in the eu

exchange rate pass through abstract the pass through relationship between exchange rate and prices of manufactured exports is examined for korea it is found that exporters take competitors prices at the prime mover of price setting and let profits bear the brunt of adjustment to the exchange rate changes

time series evidence on shirking in the u s house of representatives this paper presents time series evidence on the voting behavior of members of the u s house of representatives from 1975 to 1990 the empirical results indicate that voting behavior of individual congressmen is remarkably stable over time we find no evidence of economically significant last term effects on voting behavior nor are there important effects of legislative tenure on voting patterns the most significant deviations in voting behavior occur for congressmen who failed to win their reelection bid suggesting that sizable deviations from previous policy positions may result in swift retribution by constituents in the district