efficient and durable decision rules with incomplete information we compare six concepts of efficiency for economies with incomplete information depending on the stage at which individuals welfare is evaluated and on whether incentive constraints are recognized an example is shown in which an incentive efficient decision rule may be unanimously rejected by the individuals in the economy we define durable decision rules which can resist such unanimous rejection and show that efficient durable decision rules exist

efficient mechanisms for bilateral trading we consider bargaining problems between one buyer and one seller for a single object the seller s valuation and the buyer s valuation for the object are assumed to be independent random variables and each individual s valuation is unknown to the other we characterize the set of allocation mechanisms that are bayesian incentive compatible and individually rational and show the general impossibility of ex post efficient mechanisms without outside subsidies for a wide class of problems we show how to compute mechanisms that maximize expected total gains from trade and mechanisms that can maximize a broker s expected profit journal of economic literature classification number 026

statistical efficiency of double bounded dichotomous choice contingent valuation the statistical efficiency of conventional dichotomous choice contingent valuation surveys can be improved by asking each respondent a second dichotomous choice question which depends on the response to the first question if the first response is yes the second bid is some amount greater than the first bid while if the first response is no the second bid is some amount smaller this double bounded approach is shown to be asymptotically more efficient than the conventional singlebounded approach using data from a survey of californians regarding their willingness to pay for wetlands in the san joaquin valley we show that in a finite sample the gain in efficiency can be very substantial

utilitarian aggregation of beliefs and tastes harsanyi s utilitarianism is extended here to savage s framework we formulate a pareto condition that implies that both society s utility function and its probability measure are linear combinations of those of the individuals an indiscriminate pareto condition has been shown to contradict linear aggregation of beliefs and tastes we argue that such a condition is not compelling society should not necessarily endorse a unanimous choice when it is based on contradictory beliefs our pareto condition is restricted to choices that involve identical beliefs only

electricity shortages and firm productivity evidence from china s industrial firms unreliable inputs to production particularly those that are difficult to store can significantly limit firms productivity leading them to react in a number of ways this paper uses a panel of 23 000 energy intensive chinese firms from 1999 to 2004 to examine how firms responded to severe power shortages in the early 2000s our results suggest that in response to electricity scarcity chinese firms re optimize among inputs to production by substituting materials for energy both electric and non electric sources a shift from make to buy of intermediate inputs to production while outsourcing can be costly chinese firms were able to avoid substantial productivity losses by doing so as a result of the increase in electricity scarcity from 1999 onward we find that unit production costs increased by eight percent

electricity outages in ghana are contingent valuation estimates valid african countries experience persistent and serious energy outages but while multiple valuation studies provide estimates of the costs of electricity outages in high income countries evidence is scarce for lower and middle income countries the few studies that assess the value of reliable energy supply rely on the contingent valuation method that is under wide scrutiny this paper aims to provide new estimates of households willingness to pay to reduce electricity outages for ghana and contributes to the debate on the validity of contingent valuation results for energy reliability our results suggest that households are willing to pay ghs 67 17 per month for reliable electricity supply equivalent to 7 of respondents income the results of tests for hypothetical bias wtp wta disparity and income effects suggest that the contingent valuation estimates from this study are robust and can support decision makers in prioritizing energy policies and investments

ex ante and ex post welfare optimality under uncertainty it is widely believed by economic theorists that if there were no transactions costs and if all information about the economy were perfectly shared by all then arrow debreu contingent commodity markets should bring about an ideal allocation the basis for this belief seems clear we have the two efficiency theorems of welfare economics which assure us that in the absence of external effects any competitive allocation is pareto efficient and that any pareto efficient allocation is competitive provided that appropriate lump sum transfers are made of course there are some reservations that need to be made local satiation and non convexities are well known to cause problems but these are not the problems i wish to discuss here to return to the usual argument the next step involves noticing how with contingent commodity markets the efficiency theorems of welfare economics carry over to an economy with uncertainty as explained for instance in chapter 7 of debreu s theorpj of value the fundamental value judgment that gives these efficiency theorems their normative interest is what may be called consumer sovereignty it is an assumption that the social welfare ordering should respect the preferences that govern consumers market behaviour it is a serious value judgment more serious than most economists have been prepared to concede but its seriousness increases when there is uncertainty we know full well that individuals misperceive the probabilities of certain events assuming that they even perceive any probabilities at all see for example kahneman and tversky 1979 nor are we always willing to accept as appropriate the attitudes to risk of individuals who seem either extremely reckless or extremely cautious societies are often willing to make some gestures towards property owners who have not insured themselves adequately against damage from fire flood or tempest and not just because of imperfect insurance markets or even misperceptions of probabilities in addition the inequalities of income that arise when some individuals take more risks than others are not necessarily seen to be desirable particularly if an individual has undertaken a useful but risky activity and has a very low income as a result of failure such gestures are examples of contingent lump sum transfers it seems clear that if such transfers occur to a sufficient extent they could supplant completely the securities markets which are usually sufficient to bring about pareto efficiency they may even be able to go further and correct the imperfections of an arrow debreu market allocation when individuals do misperceive probabilities or else have wrong attitudes to risk this is the main question i wish to consider here the idea that consumer sovereignty should not always extend to economies with uncertainty is not new it can be found in work by diamond 1967 dr6ze

climate policies in a second best world a case study on india abstract the aim of this article is to analyze the potential for synergies between climate policies and development in a case study on india focusing on the power sector sub optimalities to do so we use imaclim r a dynamic recursive energy economy model that represents a second best world with market imperfections and short run adjustments constraints along a long term growth path the analysis suggests i global carbon pricing induces prohibitive macroeconomic costs for the indian economy even in the case of significant financial transfers associated with a global cap and trade system and a contraction and convergence in 2100 allocation scheme and ii the most cost efficient climate policies are not uniform carbon pricing only the implementation of domestic policies suited to the national context for instance targeting sub optimalities in the power sector for india allows reducing significantly the macroeconomic costs induced by international mitigation policies

anarchy efficiency and redistribution this paper develops a contractarian theory of the state and the existence of redistribution the existence of rules of redistribution is explained without any recourse to the risk aversion of agents no veil of ignorance is needed this avoids obligational problems inherent in most other contractarian theories of justice hence this paper departs from the standard legitimization of redistribution as fundamental insurance and interprets it as stemming from a principle of reciprocity in trade since this paper deals with an anarchic society the implementation of redistributional rules is constrained by the assumption of self enforcement we show that this assumption changes the interpretation of the state the state is characterized by a particular design of equilibrium strategies not by the existence of enforcement agencies

greenhouse gas models and abatement costs for developing nations a critical assessment numerous ghg policy studies are reported for developing countries most use demand driven bottom up models reported abatement costs vary significantly across countries for identical options this can cause policy conflicts such as for gef financing schemes top down macroeconomic studies for developing countries are scant their model structure assumes dynamics akin to developed market economies transitional dynamics of developing countries such as underdeveloped markets and informal activities are inadequately modelled policy analysis is thus restricted to market oriented alternatives while more relevant bifurcation scenarios along alternate development patterns are ignored alterations in model structure and policy analysis are proposed to represent the realities of developing nations

euvoluntariness and just market exchange moral dilemmas from locke s venditio it is a maxim of public choice that voluntary exchanges should not be interfered with by the state but what makes a voluntary market exchange truly voluntary we suggest contra much of the economics literature that voluntary exchange requires consent uncoerced by threats of harm but that this is not sufficient in particular a person pressured to exchange by the dire consequences of failing to exchange e g dying of thirst or hunger is still coerced and coerced exchange cannot be voluntary the weaker party s desperation gives the other party unconscionable bargaining power we argue for a distinction based on a neologism in the case of coercion by circumstance but not by threat exchange is still voluntary in the conventional sense but it is not euvoluntary i e truly voluntary we will argue that all euvoluntary exchanges are just while non euvoluntary exchanges may or may not be unjust that in competitive markets all exchanges are just even those that are not euvoluntary while in bilateral monopolies some exchanges are neither euvoluntary nor just we will propose a mental device the fictitious negotiation to determine the just price in non euvoluntary market exchanges a primitive version of these ideas can be found in a little known monograph by john locke which we will analyze in detail

was privateering plunder efficient abstract this paper argues that when contracts between enemies are enforceable and transaction costs are low plunderers and their victims benefit from trade that facilitates the former s ability to plunder the latter coasean plunder contracts transform part of plunder s social costs into private benefits for plunderers and their victims a significant portion of the wealth that plunder would otherwise destroy is preserved instead the result is more efficient plunder to investigate our hypothesis we consider maritime marauding in the 18th and 19th centuries privateers developed a system of ransom and parole founded on coasean plunder contracts with victim merchantmen

embracing morals in economics the role of internal moral constraints in a market economy abstract economists who adhere to the assumptions of homo economicus typically focus on altering external constraints through laws or regulations as the means of eliminating bad behavior reaching the optimal solution is simply a matter of having government adjust the price of unwanted behavior through punishments or fines but adam smith highlighted the importance of another type of constraint the internal moral constraint in recent years behavioral experimental and other economists have documented that people often do not act according the assumptions of the homo economicus model and instead appear to incorporate moral constraints into their decision making process in light of this growing body of research this article argues that many economists have placed too much emphasis on external constraints and that more emphasis should be placed on internal moral constraints after discussing possible sources of internal moral constraints the paper describes how these constraints can help strengthen cooperation in the short and long run

optimal bid selection for dichotomous choice contingent valuation surveys abstract this paper develops a model for optimal survey design for the dichotomous choice contingent valuation method that finds the bid amounts as well as the sample sizes corresponding to each bid the model uses an iterative procedure to select the survey design that minimizes the mean square error of the welfare measure a set of monte carlo simulations shows that the model produces significantly lower mean squared errors for the welfare estimate than the next best model produces survey design under alternative assumptions regarding the statistical distribution of the welfare measure is also addressed the model produced significantly different survey designs depending on whether the distribution was assumed to be symmetric or asymmetric

marginal deterrence and multiple murders this paper examines empirically the state level impact of capital punishment on multiple murder rates for the period 1995 1999 in baseline tests tests employing mixed panel data and using an estimation technique combining aspects of both fixed and random effects models we show that executions reduce the single murder rate and that the use of electrocution reduces the murder rate beyond that resulting from lethal injection these results are not unique the unique finding of our analysis is that multiple murders are not deterred by execution in any form quite possibly because the marginal cost of murders after the first is approximately zero finally we offer a brief historical analysis of how the principle of marginal deterrence has been used and suggest how it might be applied in the matter of multiple murders

cross subsidy removal in electricity pricing in india abstract in india electricity price for agriculture is cross subsidized by the industries the indian government has started a process through which the extent of cross subsidization is gradually being reduced the idea is to replace the cross subsidization by 2030 and introduce a rate structure that will increase with the amount of electricity usage this paper uses the computable general equilibrium framework to evaluate the ex ante impact of these policy changes on the indian economy the paper finds that removal of cross subsidies will increase inflation particularly food inflation resulting in a decline in household incomes more so in rural areas replacing cross subsidies with a progressive rate structure will compensate for only a small part of the negative effects of the removal of cross subsidies four other policy options are also investigated targeting household incomes food inflation and general inflation most of these options do not work as the required increase in budget deficit is unlikely to be bearable to the government the only feasible option appears to be a direct price subsidy to agricultural sector in this case food prices are held down inflation is moderate and effect on household incomes is minimal

modelling energy systems for developing countries abstract developing countries energy use is rapidly increasing which affects global climate change and global and regional energy settings energy models are helpful for exploring the future of developing and industrialised countries however energy systems of developing countries differ from those of industrialised countries which has consequences for energy modelling new requirements need to be met by present day energy models to adequately explore the future of developing countries energy systems this paper aims to assess if the main characteristics of developing countries are adequately incorporated in present day energy models we first discuss these main characteristics focusing particularly on developing asia and then present a model comparison of 12 selected energy models to test their suitability for developing countries we conclude that many models are biased towards industrialised countries neglecting main characteristics of developing countries e g the informal economy supply shortages poor performance of the power sector structural economic change electrification traditional bio fuels urban rural divide to more adequately address the energy systems of developing countries energy models have to be adjusted and new models have to be built we therefore indicate how to improve energy models for increasing their suitability for developing countries and give advice on modelling techniques and data requirements

are small firms willing to pay for improved power supply evidence from a contingent valuation study in india abstract this paper provides new estimates on indian small scale manufacturing firms willingness to pay wtp for reliable power supply almost half of indian manufacturing lies in the small scale sector and its productivity is severely affected by power outages however there is a surprising paucity of research on small firms wtp for avoiding outages we conduct a double bounded dichotomous choice contingent valuation experiment with a random sample of 260 small scale firms in the region around hyderabad we find that on average firms are willing to pay approximately 20 more for uninterrupted power supply the wtp estimates and the explanatory factors for the firms decisions were tested for robustness using both probit and bivariate probit models in addition a two step heckman correction was used to control for selection bias induced by protest responses our results are vital to understand behavior of small firms which are crucial to india s economic growth further the government s continued emphasis on power sector reforms makes the paper even more important as it provides realistic estimates for designing tariffs while keeping in mind the preferences of the small scale industry

anarchy the market and the state the characteristics of private and public goods and the conditions defining the pareto optimal allocation of each are as opposite as are anarchy and dictatorship pareto optimality with private goods requires the horizontal summation of demand schedules the equation of each individual s marginal rate of substitution to the price ratio pareto optimality with public goods requires vertical summation of demand schedules the equation of the summation of marginal rates of substitution to the price ratio increasing the number of buyers and sellers improves the allocation of private goods as does increasing their mobility the orderly anarchy of the market achieves a pareto optimal allocation of resources for pure private goods if there is either a large number of buyers and sellers or perfect mobility into and out of all markets in contrast pareto optimality in the anarchic provision of a pure public good can be assumed with certainty only in the trivial case of a community of one once crusoe is joined by friday public goods provision becomes a prisoners dilemma with non pareto outcomes likely with small numbers pareto optimality may still emerge in an anarchic prisoners dilemma game if the same players repeat the game indefinitely through the familiar logic of the prisoners dilemma supergame 12 ch 2 1 thus small numbers and immobility favor the anarchic achievement of pareto optimality for public goods provision just as large numbers and high mobility favor the anarchic achievement of pareto optimality in private goods markets this dichotomous view of the potential for a pareto optimal allocation of resources under anarchy has the obvious twin implication that the case for government intervention is strongest when the numbers of buyers and sellers of private goods are small and mobility absent and for public goods when numbers are large and mobility high although this dichotomous depiction of the allocation problem is highly simplified it does provide some insight into where we can should expect to find governments intervening where we can should not now consider the further implication the characteristics of a community in terms of the number of members and their mobility are usually the same with respect to both private goods allocation and public goods allocation a medieval village consisted of a small number of families most of whose members never traveled more than a few kilometers from the village throughout their lives this same small group of people would confront each other in the many public good prisoners dilemma situations a community faces as they would in whatever market transactions that took place one expects from the discussion above that the provision of public goods in a medieval village e g law and order and the resolution of other prisoners

utilitarianism egalitarianism and the timing effect in social choice problems two theorems are derived about social choice functions which are defined on comprehensive convex subsets of utility allocation space theorem 1 asserts that a linearity condition together with pareto optimality implies that a social choice function must be utilitarian theorem 2 asserts that a concavity condition together with pareto optimality and independence of irrelevant alternatives implies that a social choice function must be either utilitarian or egalitarian these linearity and concavity conditions have natural interpretations in terms of the timing of social welfare analysis before or after the resolution of uncertainties and its impact on social choices

power sector reform in south asia why slow and limited so far although south asian developing countries had initiated some form of electric power sector reform in the 1990s often under external lending agency pressures not much progress has been made so far and there is hardly any noteworthy example of a successful reform in the region this paper provides a brief review of power sector reform efforts in five south asian countries and uses an institutional economics framework to identify the factors shaping the success of power sector reforms four factors namely instability of rule makers poor overall acceptance slow adaptation and poor transition management are identified and their effect on the reform process of south asia are analysed the paper finds that political instability has affected the power sector reform of the region making hard decisions difficult to take slow progress of reform has also affected the sector viability as signs of adverse effects on the power sector investment and performance are already visible

adam smith and the prisoners dilemma in ordinary life we engage in many transactions with other people in which there is potential profit for both parties from some kind of cheating normally we do not see much of this cheating i have no doubt that the merchant will put in the package the merchandise which i buy or which i ordered even though if he put in something else cheaper it is quite dubious that i would be able to win a lawsuit on my part if i decide i did not like the product and returned it with the remark that it was defective having first damaged it so that it is indeed defective i could get a gain neither i nor the merchant worries particularly about this kind of behavior although the merchant worries more than i do for reasons that will become plain below if we worried about it we would both take precautions with the result that socially we would be worse off by the cost of these precautions we have here what appears to be a prisoners dilemma matrix but the two parties are behaving cooperatively what adam smith called the discipline of continuous dealings takes care of the matter the point of this article is to work out adam smith s insight in the terminology of a modern game theory we shall see that smith was right and there are some cases indeed practically very important cases where what appears to be a prisoners dilemma in fact leads to cooperative behavior consider the prisoners dilemma game shown in figure i it is orthodox that if a and b are playing a single turn of this particular game they will end up in the lower right hand corner with a net loss of one dollar each if we go from a single game to a long series of games played by the same players however there is no agreed upon solution experimental evidence seems to indicate that the players play a mixed strategy with some cooperative plays and some noncooperative plays and the mixture can be modified by changing the payoffs 2 all of these situations are simplifications of the real world and it is a point of this article to suggest that if we make the game more like many real world

trade with heterogeneous prior beliefs and asymmetric information no trade theorems have shown that new information will not lead to trade when agents share the same prior beliefs this paper explores the structure of no trade theorems with heterogeneous prior beliefs it is shown how different notions of efficiency under asymmetric information ex ante interim ex post are related to agents prior beliefs as well as incentive compatible and public versions of those efficiency concepts these efficiency results are used to characterize necessary and sufficient conditions on agents beliefs for no trade theorems in different trading environments

public choice and the economic analysis of anarchy a survey public choice economists began studying anarchy in the 1970s since then the amount of research on anarchy has burgeoned this article surveys the important public choice contributions to the economics of anarchy following early public choice economists many economists are researching how individuals interact without government from non public interested explanations of the creation of government to historical studies of internalizing externalities under anarchy public choice scholars are arriving at a more realistic perspective of human interaction with and without government although the economics of politics receives more attention the economics of anarchy is an important area of research in public choice

elasticities of electricity demand in urban indian households abstract in the past several electricity demand studies have been published for india based on aggregate macro data at the country or sub national state level since the underlying theory of consumer demand is based on the behaviour of individual agents the use of micro data which reflects individual and household behaviour more closely can shed greater light on the nature of consumer responses in this paper seasonal price and income elasticities of electricity demand in the residential sector of all urban areas of india are estimated for the first time using disaggregate level survey data for about 30 000 households three electricity demand functions have been econometrically estimated using monthly data for the winter monsoon and summer season in order to understand the extent to which factors like income prices household size and other household specific characteristics influence variations observed in individual households electricity demand the results show electricity demand is income and price inelastic in all three seasons and that household demographic and geographical variables are significant in determining electricity demand

the effect of regulatory governance on efficiency of thermal power generation in india a stochastic frontier analysis abstract this paper investigates the impact of institutional quality typified as regulatory governance on the performance of thermal power plants in india the indian power sector was reformed in the early 1990s however reforms are effective only as much as the regulators are committed in ensuring that they are implemented we hypothesize that higher the quality of regulation in a federal indian state higher is the efficiency of electric generation utilities a translog stochastic frontier model is estimated using index of state level independent regulation as one of the determinants of inefficiency the dataset comprises a panel of 77 coal based thermal power plants during the reform period covering over 70 of installed electricity generation capacity the mean technical efficiency of 76 7 indicates there is wide scope for efficiency improvement in the sector results are robust to various model specifications and show that state level regulators have positively impacted plant performance technical efficiency is sensitive to both unbundling of state utilities and regulatory experience the policy implication is that further reforms which empower independent regulators will have far reaching impacts on power sector performance

anarchy and autarky endogenous predation as a barrier to trade this article presents a general equilibrium two country ricardian trade model with endogenous transactions costs that arise from individual utility maximizing allocation of labor to production and piracy in the absence of institutions for risk sharing and coordination of defense autarky obtains over most of the parameter space when both trade and predation are supported in equilibrium terms of trade effects can make security immiserizing in that case paradoxically predation creates trade

an arrgh chy the law and economics of pirate organization this article investigates the internal governance institutions of violent criminal enterprise by examining the law economics and organization of pirates to effectively organize their banditry pirates required mechanisms to prevent internal predation minimize crew conflict and maximize piratical profit pirates devised two institutions for this purpose first i analyze the system of piratical checks and balances crews used to constrain captain predation second i examine how pirates used democratic constitutions to minimize conflict and create piratical law and order pirate governance created sufficient order and cooperation to make pirates one of the most sophisticated and successful criminal organizations in history

interruptible electricity contracts from an electricity retailer s point of view valuation and optimal interruption we consider interruptible electricity contracts issued by an electricity retailer that allow for interruptions to electric service in exchange for either an overall reduction in the price of electricity delivered or for financial compensation at the time of interruption we provide a structural model to determine electricity prices based on stochastic models of supply and demand we use stochastic dynamic programming to value interruptible contracts from the point of view of an electricity retailer and describe the optimal interruption strategy we also demonstrate that structural models can be used to value contracts in competitive markets our numerical results indicate that in a deregulated market interruptible contracts can help alleviate supply problems associated with spikes of price and demand and that competition between retailers results in lower value and less frequent interruption

incentives to invest in liberalised electricity industries in the north and south differences in the need for suitable institutional arrangements the issue of investment is all too often underplayed in deregulation reforms focused on market rules and de integration measures this presentation criticises first the optimistic approach of the theory of investment incentives through market signals when it is applied to deregulated electricity industries the greater part of the investment in base load and peak equipment should be made profitable by income from very high prices during peak and extreme peak periods that raises a problem of political acceptability the problem is then addressed in the context of the mature electricity industries in the north given the maturity of markets there a number of modifications to the pure market model could be envisaged to strengthen incentives to invest but none of them is perfect the main way is to focus on adaptation of market rules on the supply of power at peaks and extreme peaks by considering capacity adequacy as a public good with three solutions capacity payment reserve obligations centralised procurement by auctioning for peak capacity observation of reforms suggests also the validity of some other solutions based on a limitation of the competition by allowing long term contracts and vertical integration between production and supply finally the question is extended to the specific problem of developing countries characterised by irregular growth it is argued that reforms must be designed in view of the importance of the need for investment through long term coordination and reduction of investment risks indeed experiences of latin american liberalised industries show that they have to include a number of competition based imperfections and to allow ongoing exercise of market power in order to allow prices to rise above competition prices the single buyer model or some variants of it appear to be good alternatives if one wishes to avoid the twists and turns of the competition paradigm the difficulty with this model arises from the institutional conditions necessary to make it efficient and not overcostly c 2005 elsevier ltd all rights reserved

anarchy and its breakdown anarchy defined as a system in which participants can seize and defend resources without regulation from above is not chaos but rather a spontaneous order however anarchy is fragile and may dissolve either into formless amorphy or into a more organized system such as hierarchy under anarchy each contestant balances between productive exploitation of the current resource base and fighting to acquire or defend resources anarchy is sustainable only when there are strongly diminishing returns to fighting effort the decisiveness parameter is sufficiently low and incomes exceed the viability minimum these considerations explain many features of animal and human conflict

market failure government failure and the private supply of public goods the case of climate controlled walkway networks two opposing models of public goods undersupply are those of market failure and government failure empirical work on the relative explanatory power of these two frameworks has been limited by the scarcity of acceptable data the case of climate controlled walkways in major urban cores is a rare instance where such difficulties can be overcome we investigate the supply of ccws in 55 large city cores in north america we find that 1 ccw networks are well supplied by market forces when 2 such forces are not frustrated by government policy we also find evidence that 3 rules based regimes dominate discretion based regimes these results are consistent with the position that the government failure paradigm is a viable alternative to the traditional market failure paradigm

might makes rights a theory of the formation and initial distribution of property rights this paper is a theoretical and empirical investigation into the formation and initial distribution of property rights violence is singled out as a major constraint on this formation process its role is explicitly modeled in a choice theoretic framework and some of the implications are tested using data collected from contracts written during the california gold rush of 1848

modeling energy and development an evaluation of models and concepts most global energy models are developed by institutes from developed countries focusing primarily on issues that are important in industrialized countries evaluation of the results for asia of the ipcc sres models shows that broad concepts of energy and development the energy ladder and the environmental kuznets curve can be observed in the results of the models however improvements can be made in modeling the issues that underlie these concepts like traditional fuels electrification economic structural change income distribution and informal economies given the rapidly growing importance of energy trajectories of developing countries for global sustainability the challenge for the future is to develop energy models that include all these aspects of energy and development

the impact of firm specific assets and the interaction of uncertainty an examination of make or buy decisions in public and private hospitals abstract this study examines the impact of uncertainty as articulated in the transaction cost economics framework and its interaction with asset specificity in determining make or buy decisions our analysis of a sample of over 2900 transactions supports the view that in the presence of specific assets increased uncertainty will induce firms to integrate at lower levels of asset specificity we also find that transaction cost explanations are subject to contextual factors in particular the results support transaction cost predictions for private hospitals but not for public hospitals where market efficiency pressures are not as strong

anarchy self governance and legal titling scholars and policymakers prescribe legal titling to improve prospects for economic development and political order however a public choice literature exists that has long recognized that self governance often works well and that the state may not be able to improve upon local economic institutions at reasonable cost although the implication that legal titling should proceed with caution is seemingly straightforward the literature on legal titling does not take anarchy seriously as a policy option in addition there is a public choice literature that presumes the state is the most important source of property rights this essay fills this gap in the property rights literature by applying the concept of efficient anarchy to legal titling in afghanistan original fieldwork evidence from rural afghanistan suggests that anarchy of land governance is a better option than legal titling the essay concludes by opening up the black box of state building by explaining why it often makes sense to sequence improvements in political capacity and political constraints prior to investing in legal titling

edward stringham ed anarchy state and public choice is anarchy a viable desirable form of organization of society anarchy intrigues economists as the limit of the process of privatization can all government s functions be turned over to market forces in the early 1970s winston bush led an exploration of anarchy at the public choice center at virginia tech the new book anarchy state and public choice edited by edward stringham brings together some of the old school public choice contributions with contemporary research the book consists of seven papers reprinted from gordon tullock s edited volumes explorations in the theory of anarchy and further explorations in the theory of anarchy along with six modern responses and four original retrospective prospective papers the reprinting of some of the earlier papers should provide new life into this research and the paired contemporary papers illustrate that significant progress has been made in the intervening decades a paper by winston bush from explorations on equilibrium in an anarchy model and a response by jason osborne lead off the volume bush s paper is a now familiar description of the equilibrium in an anarchy economy emphasizing the natural distribution of income resulting from comparative advantage in predation osborne offers an intriguing two part response the first examines the impact of a contract enforcer on relative well being in the bush anarchy economy while the second considers the implications of research on contingent cooperation in a prisoner s dilemma recent research emphasizes the benefits of contingent cooperation and how well developed abilities to detect cheating allow the prisoner s dilemma to be overcome without third party enforcement increasing the potential for a workable anarchy the next two papers from explorations by gordon tullock and j patrick gunning and the contemporary responses by christopher coyne and peter leeson deal with contract enforcement tullock and gunning argue that government must enforce contracts particularly deals over time or when one party has a lot at stake the replies by coyne and leeson draw

the emergence of cooperation among egoists this article investigates the conditions under which cooperation will emerge in a world of egoists without central authority this problem plays an important role in such diverse fields as political philosophy international politics and economic and social exchange the problem is formalized as an iterated prisoner s dilemma with pairwise interaction among a population of individuals results from three approaches are reported the tournament approach the ecological approach and the evolutionary approach the evolutionary approach is the most general since all possible strategies can be taken into account a series of theorems is presented which show 1 the conditions under which no strategy can do any better than the population average if the others are using the reciprocal cooperation strategy of tit for tat 2 the necessary and sufficient conditions for a strategy to be collectively stable and 3 how cooperation can emerge from a small cluster of discriminating individuals even when everyone else is using a strategy of unconditional defection

non prisoner s dilemma abstract all prisoner s dilemma experiments pre select contestants prevents them from communicating and changing partners in the middle of things this brief experiment changes all three of these conditions and gets a very high degree of cooperation

two bandits or more the case of viking age england the olsonian distinction between roving and stationary bandits outlines the rationale behind the transition from anarchy to the emergence of the predatory state this two bandit model may however be expanded to include more bandit types in the case of viking age england local english kings were unable to monopolize violence and defend their realms against competing viking raiders as the vikings time horizon grew so did the accumulated value of more formal taxation and bandit types evolved in four steps the first step is the olsonian roving bandit who executed viking hit and run attacks and plunders during the second half of the tenth century the second step is the gafol bandit gafol is payment for leaving paid to among others swein forkbeard the third step is the heregeld bandit heregeld is a tax to support an army for hire most notably thorkell the tall s the fourth step is the olsonian stationary bandit i e the strongest military leader among the vikings cnut the great settled down as the new king overall the olsonian two bandit model can be expanded to a four bandit staircase model in which the new gafol and heregeld bandit types explain the steps from anarchy and short run raiding to long run formal taxation in a predatory state

the transaction costs driving captive power generation evidence from india the 2003 indian electricity act incentivizes captive power production through open access in an attempt to harness all sources of generation yet we observe that only some firms self generate while others do not in this paper we give a transaction cost explanation for such divergent behavior using a primary survey of 107 firms from india we construct a distinct variable to measure the transaction specificity of electricity use the make or buy decision is then econometrically tested using probit model results are highly responsive to transaction specificity and the likelihood of captive power generation is positively related to it at the industrial level this explains why food and chemical firms are more likely to make their own electricity since the burden of poor grid supply is highest on smaller sized and high transaction specific firms the grid access policies need to account for firm level characteristics if government wants to incentivize captive power generation

optimal designs for discrete choice contingent valuation surveys single bound double bound and bivariate models this paper finds the designs for discrete choice contingent valuation surveys which maximize the precision of a statistic of interest about the public s willingness to pay wtp for a change in the environmental quality such as median wtp an optimization problem is set up in which the efficiency of the estimate of median wtp or a related concept is the objective function to optimize with respect to the survey design i e the set of bids offered to the respondents in deriving the optimal designs we consider alternative econometric models such as the basic single bound model that uses the responses to the first payment question the traditional interval data or double bound model for surveys with a follow up payment question and the recently proposed bivariate binary response model simulations are carried out to compare the alternative design principles and assess their performances with respect to the statistic of primary interest median wtp and other welfare measures such as mean wtp other designs that are constructed ad hoc are also examined

appropriation violent enforcement and transaction costs a critical survey this paper focuses on the extension of transaction costs to appropriative activity and coercive power in the property rights approach it has been argued that including the costs of appropriation and violent enforcement in transaction costs is based on the assumption that coaseian bargaining can be extended to any institutional scenario i e voluntary as well as coercive exchange however voluntary transactions cannot capture the logic of coercive power this means that the assumption of an efficient political market is not valid and that the political coase theorem lacks the logical consistency to provide a cornerstone for political theory

cost of unserved power in karnataka india this paper proposes an empirical analysis concerning the cost of unserved energy cue or value of lost load in agriculture and industrial sectors and provides insights that can provide useful inputs in designing effective policies for the power sector about 500 manufacturing units and 900 farmers were surveyed in the south indian state of karnataka using a two stage random sampling to provide interval estimates of cue for the industrial and agricultural consumers the results from the survey help in providing guidance on consumer perceptions and their willingness to pay different or higher tariffs the estimated economic loss due to power outage in the agriculture sector varies from 1 9 to 3 6 of total state domestic product sdp i e rs 950 billion at 1999 2000 prices while in industry the economic loss varies between 0 04 and 0 17 of total sdp depending upon the size of industry during the study period in 1999

does it matter when a power outage occurs a choice experiment study on the willingness to pay to avoid power outages using a choice experiment survey the marginal willingness to pay wtp among swedish households for reductions in power outages is estimated the results from the random parameter logit estimation indicate that the marginal wtp increases with the duration of the outages and is higher if the outages occur during weekends and during winter months moreover the random parameter logit model allows us to estimate a sample distribution of wtp and we find a significant unobserved heterogeneity in some of the outage attributes given that households have negative welfare effects from outages it is important that policy makers consider these negative impacts on household utility when regulating the swedish electricity market

let s agree that all dictatorships are equally bad this paper shows that a minimal degree of consideration for other people s well being enables society to agree that one social policy is the best i offer axioms that imply that this best policy maximizes a weighted sum of individual utilities the weight of each individual is the inverse of his or her maximal possible utility from social endowments the suggested policy is not sensitive to the choice of the von neumann morgenstern utilities the key axiom is that individuals agree that giving all the endowments always to one person is as bad as giving them to any other person

protest beliefs in contingent valuation explaining their motivation abstract the definition and treatment of protest responses in contingent valuation cv can have a significant influence on the estimated values of the good in question if these responses are censored in order to understand how protest responses are motivated in a cv about forest biodiversity in germany we used an item battery to identify respondents protest beliefs the items were measured for all respondents irrespective of their willingness to pay wtp in principle then a scale based on these beliefs is taken as a dependent variable of regression analyses in addition to environmental concern we used norms the warm glow of giving and dilemma concern as further explanatory variables the latter focuses on cooperation problems in protecting the environment our results show that protest beliefs are significantly influenced by the explanatory factors furthermore the protest beliefs themselves have a significant effect on the decision to be wtp as well as on the amount of money stated by those who are wtp the censoring of protest responses may therefore be indefensible

the impossibility of a paretian rational a bayesian perspective abstract if a group takes a collective decision on the basis of separately aggregated group judgments on the probabilities of independent events there may not exist any anonymous aggregation rule that respects individuals unanimous outcome preferences at all profiles of beliefs

is property crime caused by drug use or by drug enforcement policy the relationships among drug offenses prorperty crime and the allocation of police resources are investigated in a structural model using data from florida countries law enforcement resources are scarce and as efforts to combat drug crime increase the amount of these resources allocated to property crime is reduced this reallocation of police resources results in reduced deterrence for property crime and as a result an increase in these crimes the evidence presented suggests that rising property crimes in florida are at least partially the result of drug enforcement policy

use esteem and profit in voluntary provision toll roads in california 1850 1902 i introduction sometimes individuals form an enterprise not in anticipation of handsome residual returns but rather for their own use if the user group is large and the project requires numerous contributors there may be an incentive to free ride the group might overcome the free rider problem by virtue of social pressure reputational incentives participatory impulses philanthropy and so on in brief out of some form of esteem especially the reciprocal esteem of neighbors during the nineteenth century americans undertook many improvement projects not primarily for residual returns but rather for use and esteem voluntary action helped to finance schools libraries hospitals churches canals dredging companies wharves water companies railroads highways and so on goodrich 1948 1 we call the set of motivations behind such efforts use and esteem in contradistinction to the quest for residual returns in studying the history of toll road companies in california we see motives of both use and esteem and residual returns some road companies were initiated as business enterprises aiming squarely at dividends for other road companies use and esteem motivations inspired a large number of community members to contribute this we call community enterprise also there are the cases of use and esteem motives inducing a small number of wealthy parties to finance a road which we call coterie enterprise in comparison to the earlier toll road movements in the eastern united states the california toll road experience showed less of the community enterprise model and more of the business enterprise and coterie enterprise models why should an enterprise ever be undertaken in the manner of use and esteem rather than organized as a business use and esteem methods must stand in for the normal profit motive when an enterprise is unable to exclude nonpayers or charge appropriate prices bruce benson 1994 examines the private provision of policing and highways in old england and argues that obstacles to private provision stemmed from government policy rather than underlying technological conditions for example by barring toll taking on highways the government created a free access common pool benson further argues that even once government policy has blocked the business enterprise there still may be potency in the use and esteem methods of voluntary provision this paper presents a historical typology of voluntary organizations taking the stock corporation form in our study of toll roads we indeed see the business enterprise hamstrung by government policy but the road companies even though often unprofitable and motivated by use and esteem still operated with the possibility of positive residual returns thus the road companies took advantage both of financing appeals from use and esteem and of organizational efficiencies due to residual claimant incentives this is a potent combination that today s law has eliminated by the legal bifurcation of not for profit and for profit enterprises ii the toll road heritage in the 1790s americans began building turnpikes toll roads surfaced with gravel or earth and over the next half century easterners built more than 600 of them most with private funds exclusively turnpikes were popular throughout the middle west and to a lesser extent the south later the toll road returned as plank road fever swept the nation between 1847 and 1853 private initiative built better than 1 000 wooden roads not ideology but pragmatics led americans to privatize town county and state governments were strapped for cash and bad at building roads and the spirit of development led all states to release private initiative to the task compared to government road care the turnpike company offered numerous organizational advantages turnpikes connected multiple towns or counties so management transcended local government limitations and organizers could appeal to prospective contributors along the entire route

a positive theory of the predatory state while the distinction between public and private goods is essential in developing a normative theory of non predatory states the focus of this article is on a positive theory of predatory states since the predatory relationship between the state and its subjects depends on the power of the state to grab or to appropriate coercively and the subject s ability to escape or hide the boundaries of the state are decided by the nature of the assets that can be taken more or less easily accordingly i will introduce a new distinction between captive and fugitive assets that positively captures the frontiers of a state space the us railroading in the nineteenth century provides an illustration regarding the explanatory power of an asset appropriating perspective of the state compared to a public goods approach

the social contract in the laboratory an experimental analysis of self enforcing impartial agreements social contract theories are based on the idea of the consent of the governed according to which norms rules and institutions constitutions in particular must be based on the general consensus or unanimous consent of the individuals who are subject to the regulation the article reports the results of an experiment aimed at identifying the conditions for the emergence of a self enforcing social contract in the laboratory our main result is that spontaneous compliance with a non self interested norm of distribution is likely to occur if individuals have been part of the same process of ex ante agreement on the distributive norm under a veil of ignorance to which the emergence of reciprocal expectations of conformity is also related this is in line with rawls s idea of an endogenous sense of justice stabilizing ex post institutions that would have been ex ante chosen in the original position

anarchy in the laboratory and the role of the state abstract a recent literature on the economics of conflict provides conditions under which groups of individuals divide up between producers and predators an anarchic equilibrium as well as conditions under which a government agent is empowered to make collective action choices that can completely deter predation we test these theoretical predictions in a laboratory experiment in the absence of a government agent groups of subjects choose actions consistent with the anarchic equilibrium the introduction of a government agent charged with maximizing the consumption of producers enables subjects to achieve nearly perfect coordination on the pareto superior equilibrium where all individuals choose to be producers

the voluntary provision of public goods the turnpike companies of early america the voluntary provision of public goods the turnpike companies of early america i the heroic role of the agent called government in the simple public goods model is clear enough but the relevance of the model is still in dispute a long history of doubters has challenged the premises that the government has the needed information acts efficiently and acts in the public interest also doubters have contended that the free rider problem of many social services is not as ineluctable as others often seem to suggest historical studies have shown the potency of voluntary association in such fields as lighthouse provision coase 1974 education high ellig 1988 bee pollination cheung 1973 law and order anderson hill 1979 benson forthcoming neighborhood infrastructure beito 1990 agricultural research majewski 1989 among others see cowen 1988 wooldridge 1970 to help weigh the relevance of the simple public goods model i discuss the american experience of private turnpike roads the turnpike companies got started in the 1790s and were in sharp decline in the 1830s though many turnpikes were operating at the turn of our century 1 i treat turnpikes in new england new york pennsylvania new jersey and maryland the last four are called the middle atlantic states except in pennsylvania 2 the turnpikes were almost entirely financed by private subscription to stock 3 while those in most other states were mixed enterprises 4 extreme publicness marked the turnpikes both in jointness of consumption and in nonexcludability 5 the excludability problem was partly the result of legal restrictions on toll collection these restrictions were one cause of turnpike unprofitability which was discovered quickly the turnpikes afforded enormous indirect and external benefits however to the nearby farms landholdings and businesses since unprofitability was usually foreseen stock subscription necessary to construct the road was essentially a means of paying for road benefits there were two excludability problems people could use the road without paying a toll and people could indirectly benefit from the road without buying stock though related the latter is the crux of the public goods problem at hand 6 ii turnpike creation and operation the end of the 18th century saw a transition in road management until then the roads were built and maintained poorly by towns and counties as settlement expanded and the large eastern centers sought improved trade routes pressure for road improvement brought forth a radical alternative turnpikes a pay as you go means of financing a number of publicly operated turnpikes were organized patterned after the british turnpike trusts of the day 7 but even this method of road improvement demanded too much from the existing public administration states turned to private initiative 8 the turnpike companies were legally organized like corporate businesses of the day the first connecting philadelphia and lancaster was chartered in 1792 opened in 1794 and proved a significant advantage in the competition for trade regional rivalries led state legislatures to take a favorable view toward petitions to establish turnpikes by 1800 sixty nine companies had been chartered in the states under investigation 9 while legislators readily sanctioned road provision by private associations they wrote extensive regulation into company charters charters usually specified the company s total stock but this merely reflected the company s recommendation and could be changed easily powers of eminent domain were stipulated existing trails or public roadbeds were usually granted to the companies and monopoly assurance against new parallel routes was sometimes granted details for construction were given and of course toll rates and toll collection were tightly controlled

anarchy warfare and social order comment on hirshleifer in a recent article in this journal hirshleifer 1995 sought to provide an economic analysis of anarchy and in particular of the circumstances in which anarchy would break down into other forms of social order he did so by setting out an economic model of conflict and then investigating the stability of the resulting conflict equilibrium the problem with this approach is that it deals only with a particular form of anarchy i e one in which disputes are settled by violence but not all anarchies are violent hirshleifer s article thus fails to consider peaceful anarchy yet peaceful anarchy is important for two reasons 1 the parties involved in disputes have incentives often strong ones to resolve them by peaceful means and there is no necessary reason why they should rely on the state to do so a natural outcome is then an anarchy characterized by a preponderance of peaceful over violent conflict resolutions and by the absence of any authority to impose order conflict and anarchy are consequently not the same 2 there are many historical examples of peaceful anarchy they include among others the law merchant that governed mercantile dealings in medieval europe and the relatively peaceful private order that arose in the western frontier of the united states in the late nineteenth century in short anarchy is not as conflict prone or fragile as hirshleifer s treatment might lead one to believe

the theory of the firm as governance structure from choice to contract the propositions that organization matters and that it is susceptible to analysis were long greeted by skepticism by economists one reason why this message took a long time to register is that it is much easier to say that organization matters than it is to show how and why the prevalence of the science of choice approach to economics has also been an obstacle as developed herein the lessons of organization theory for economics are both different and more consequential when examined through the lens of contract this paper examines economic organization from a science of contract perspective with special emphasis on the theory of the firm

criminal justice institutions as a common pool the 19th century analysis of edwin chadwick abstract modern research into criminal justice focuses on optimal enforcement and on changes including forms of privatization that could bring efficiency into the system edwin chadwick 19th century economist and utilitarian reformer analyzed received anglo saxon justice circa 1829 1841 as an evolved publicly provided good with open access common pool characteristics with an aim of crime prevention and the reduction of type i and ii errors contemporary goals as well and while neglecting the possibilities contained in private solutions chadwick developed clear recommendations for interrelated incentive alterations to both the enforcement and penal systems the system described by chadwick is fundamentally the one that exists in the us today and his exceedingly modern analysis speaks to contemporary problems and has implications for possible reforms

the veil of public ignorance abstract a theory of cooperative choice under incomplete information is developed in which agents possess private information at the time of contracting and have agreed on a utilitarian standard of evaluation governing choices under complete information the task is to extend this standard to situations of incomplete information our first main result generalizes harsanyi s j polit econ 63 1955 309 classical result to situations of incomplete information assuming that group preferences satisfy bayesian coherence and interim pareto dominance these axioms are mutually compatible if and only if a common prior exists we argue that this result partly resolves the impossibility of bayesian preference aggregation under complete information

the spontaneous evolution of commercial law jeremy bentham contended that property and state made law are born and must die together before the state s law there was no property take away the law all property ceases 4 309 most economists have taken this argument to heart clearly some system of defining and then protecting and enforcing property rights property law and rules of exchange contract law is needed for a market system to develop but does the state have to develop and enforce property and contract law one purpose of the following presentation is to demonstrate that the commercial sector is completely capable of establishing and enforcing its own laws a second purpose is to illustrate that modern commercial law is in fact largely made by the merchant community despite governmental efforts to take over provision of such law commerce is an evolving process of interaction and reciprocity which is simultaneously facilitated by and leads to an evolving system of commercial law carl menger 17 proposed that the origin formulation and the ultimate process of all social institutions including law is essentially the same as the spontaneous order adam smith 20 described for markets markets guided by smith s invisible hand coordinate interactions and so does customary law 6 7 these systems develop because perhaps through a process of trial and error it is found that the actions they are intended to coordinate are performed more effectively under one institutional arrangement or process than under another the more effective institutions and practices replace the less effective in the case of customary commercial law traditions and practice evolve to produce the observed spontaneous order as hayek explained however while smith s and menger s insights are firmly established in economics the study of jurisprudence has been almost completely unaffected by their arguments 9 101 one reason of course is that the invisible hand explanation for the emergence of market order is highly plausible because there is an obvious mechanism the mechanics of individual but interrelated market prices which provides the necessary coordination we call the price system the mechanism of evolution for a legal order is much less obvious thus the legal positivist view which holds that law is the product of deliberate design has a strong following among economists another major purpose of this discussion of commercial law therefore is to demonstrate that the rules of property and contract necessary for a market economy which most economists and legal scholars feel must be imposed have evolved without the

rational bandits plunder public goods and the vikings the paper applies and extendsinsights from mancur olson s study of statemaking to the vikings in a world ofroving bandits a sub optimal provision ofpublic goods exists most notably ofsecurity roving banditry leads toover plundering and zero profits for theplunderers which makes stationary banditryprofitable the most efficient banditsmonopolize violence begin to tax andprovide some amounts of public goods inorder to stimulate economic growth theanalysis demonstrates how the vikings activities and settlements are consistentwith such an explanation with the dynamicsof the process being reflected in thevariation in the number of raids and theamount of wealth extracted

innovating with infrastructure how india s largest carmaker copes with poor electricity supply abstract conventional wisdom suggests that self generation is a high cost and inefficient but often unavoidable solution to unreliable public power supply in developing countries this article examines the power problem from the perspective of a large industrial user and its upstream supplier firms in india it analyzes the innovative generation and power sharing system that this firm has devised to solve both its own power problems as well as those facing some of its suppliers this research finds not only that self generation is economical but also that self generation combined with power sharing serves as a model that policy makers can replicate to ameliorate the power problems plaguing firms in developing countries

are public goods really common pools considerations of the evolution of policing and highways in england figures omitted a series of property rights alterations made by the english government undermined individuals incentives to cooperate in the production of both policing and road maintenance ultimately leading to government production the result is more accurately characterized as a free access common pool than as a public good common pool analysis suggests an array of possible policy prescriptions involving the internalization of costs and benefits through privatization of rights in contrast the public goods concept appears to be simply an ex post justification for claiming that the only efficient policy is public provision of these services at zero money prices i introduction policing and highways are frequently cited as important examples of production of public goods and it is often contended that private provision of these public goods will not occur as in samuelson and nordhaus 1985 48 49 and 713 according to tullock 1970 83 84 and samuelson and nordhaus 1985 49 for instance private sector production of policing and or highways generates non exclusionary external benefits for which private suppliers are unable to charge thus creating free rider incentives and non cooperative behavior i offer an alternative explanation for this lack of cooperation however which fits the historical evolution of public policing and highways in england the fact is that public policing and highways evolved because of changes in property rights which undermined private incentives to cooperate in the provision these services indeed these services are like the television signals discussed by minasian 1964 in that different institutional arrangements create different incentives for the allocation of resources 1 however my presentation goes beyond simply providing two supporting examples for minasian s 1964 77 contention that the public goods concept is misleading by proposing a more appropriate analytical tool for at least some allocation issues labeled as public good free rider problems in the case of policing for example before english kings began to concentrate and centralize power individuals had rights to a very important private benefit arising from successful pursuit and prosecution victims received restitution effective collection of restitution required the cooperation of witnesses and of neighbors to aid in pursuit but anyone who did not cooperate with victims could not obtain similar support when victimized and therefore could be excluded from this very important benefit of law enforcement policing was carried out by neighborhood associations and free riding did not appear to be a problem because anyone who did not cooperate was ostracized by the group in other words policing was not a public good in medieval england the primary benefits were private and or internal to small groups and non contributors were excluded one consequence of the development of monarchical government was the creation of criminal law as a source of royal revenues criminalization took away the private right to restitution and significantly reduced the incentives to voluntarily cooperate in law enforcement a very different set of institutions evolved as a consequence today rights to many attributes of public policing can be accessed by anyone as in a common pool although effective public policing still requires a substantial commitment of private resources including victim and witness cooperation 2 incentives for individuals to underinvest in the commons are substantial relative to incentives to invest in the production of any private benefits that remain in other words policing is not a public good today either its publicly produced aspects are generally treated as free access common pools and private individuals underinvest in their maintenance as demonstrated below the same is true of highways it might be argued that non excludable public goods and free access common pools are simply two terms for the same concept

the structure of the climate debate first best climate policy is a uniform carbon tax which gradually rises over time civil servants have complicated climate policy to expand bureaucracies politicians to create rents environmentalists have exaggerated climate change to gain influence other activists have joined the climate bandwagon opponents to climate policy have attacked the weaknesses in climate research the climate debate is convoluted and polarized as a result and climate policy complex climate policy should become easier and more rational as the paris agreement has shifted climate policy back towards national governments changing political priorities austerity and a maturing bureaucracy should lead to a more constructive climate debate

estimations of the economic model of crime using aggregate and individual level data much has happened in the economics of crime since becker s 1 seminal paper of two decades ago the theory has been refined by among others ehrlich 10 11 12 block and lind 4 5 block and heinke 3 and schmidt and witte 30 attempts to test the model empirically began immediately the most cited including ehrlich 10 11 12 sjoquist 31 carr hill and stern 7 phillips and votey 26 witte 38 and myers 22 23 interest continues with recent work including layson 19 sandelin and skogh 29 ehrlich and brower 13 cover and thistle 9 viscusi 36 and tauchen witte and griesinger 33 there has been some controversy however concerning the type of data more suitable to the estimation of the economic model of crime most of the work has used aggregate data in which the unit of observation is a political jurisdiction but the use of aggregate data has been sharply criticized the alternative is individual data few attempts have been made to use individual data probably because an ideally constructed data set representative of a general population would be far too costly for most research budgets most of the studies that have been done have used data on releasees from prison or other criminal justice programs they are in effect recidivism studies based on the economic model of crime

distributional impacts of climate change mitigation in indian electricity the influence of governance abstract studies that examine the distributional impacts of climate change mitigation policies often neglect the influence of institutions that implement these policies this study examines the short term consumption side distributional impacts of expanding low carbon electric supply in the state of maharashtra india with a focus on the influence of regulatory discretion in pricing households welfare impacts from economy wide electricity price shocks are simulated against a baseline that is calibrated to actual household economic and electricity service conditions including actual electricity budgets block tier prices and supply rationing industrial price impacts are propagated to households using a leontief input output analysis regulatory pricing decisions are evaluated based on social welfare metrics for economic efficiency and income inequality the analysis reveals new linkages between climate change mitigation electricity policy and income distribution low income households can be shielded from mitigation impacts without losses in aggregate welfare to the extent that regulators can recover mitigation costs through industrial price increases regulators flexibility to distribute costs across households is constrained by industrial customers migration off the grid reduced supply interruptions to the rural poor from the resulting demand contraction are a potential co benefit of mitigation distributional impacts therefore depend on other electricity policies that are driven by the political economy of the sector

toward a macroeconomics of the medium run these days macroeconomics has become more respectable than it used to be i can remember when many economists liked to say microeconomics is not problematic but i just don t understand macroeconomics there was a definite implication that something must be wrong with macroeconomics not with the observer of course macroeconomics cannot be exact it has to work by rough analogy and empirical compromise maybe a certain raffishness is inevitable most economists work on microeconomic problems with increasing use of new microeconomic data but now it is widely understood that macroeconomics is at the heart of economics it will not do to be snooty about it this centrality will continue for the best possible reason the need to understand current events especially unfavorable ones and to formulate policies even benign neglect is a policy to

the determinants of electricity theft an empirical analysis of indian states abstract more than 20 of the electricity generated in india is lost to rampant thefts drawing data from 28 states of india over a time span of five years 2005 2009 this paper examines the role played by socio economic and governance factors in determining the extent of electricity thefts in indian states results from the feasible generalised least squares fgls model demonstrate that lesser corruption higher state tax to gdp ratio greater collection efficiency of electricity bills by state utilities higher share of private installed capacity lesser poverty greater literacy and greater income are closely associated with lesser power thefts a better understanding of the key determinants of thefts in electricity distribution is vital for policy makers for designing policies

from the econometrics of capital punishment to the capital punishment of econometrics on the use and abuse of sensitivity analysis the academic debate over the deterrent effect of capital punishment has intensified again with a major policy outcome at stake about two dozen empirical studies have recently emerged that explore the issue donohue and wolfers 2005 claim to have examined the recent studies and shown the evidence not to be robust to specification changes we argue that the narrow scope of their study does not warrant this claim moreover focusing on our two studies that they have examined we show the deterrence findings to be robust while their work has serious flaws and their reporting appears to be selective the selectivity is biased towards showing no deterrence