from shadow to green linking environmental fiscal reforms and the informal economy in the past few decades many papers have analysed in some depth different environmental tax reforms and the double dividend hypothesis i e the possibility of improving not only the environment but also the economy through the reduction of distortions in the tax system recently more stress has been placed on testing empirically what effects a reduction in labour taxes may have on unemployment when accompanied by a carbon or other environmental tax however such studies have not modelled the effects of the presence of a shadow economy even though informal markets account for a significant and growing part of gdp in many developed economies this paper analyses this link using an applied general equilibrium model for the case of spain which has one of the highest unemployment rates in the world and one of the biggest informal economies of any wealthy country we conclude that our analysis strengthens the case for an environmental tax reform in spain if revenues from a co2 tax are recycled via a labour tax reduction

co2 emissions and income dynamics what does the global evidence tell us this paper analyzes the co evolution of two major determinants of social welfare namely income and carbon emissions in particular by using a distribution dynamics approach based on markov chains we investigate the shape and behavior of the joint distribution of per capita income and carbon dioxide emissions we arrive at several interesting conclusions especially in the context of international negotiations on climate change first evidence does not support theoretical models predicting the existence of a poverty environment trap specifically in the long run two main groups of countries will emerge poor versus polluting countries second the typical development path leads initially to high emission levels and subsequently to high income third the convergence process towards the stationary distribution is very slow finally for carbon emissions whenever it is observed the environmental kuznets curve seems to be only a transitory phenomenon

did unilateral divorce laws raise divorce rates a reconciliation and new results application of the coase theorem to marital bargaining suggests that shifting from a consent divorce regime to no fault unilateral divorce laws should not affect divorce rates each iteration of the empirical literature examining the evolution of divorce rates across us states has yielded different conclusions about the effects of divorce law liberalization i show that these results reflect a failure to jointly consider both the political endogeneity of these divorce laws and the dynamic response of divorce rates to a shock to the political regime taking explicit account of the dynamic response of divorce rates to the policy shock i find that liberalized divorce laws caused a discernible rise in divorce rates for about a decade but that this increase was substantially reversed over the next decade that said this increase explains very little of the rise in the divorce rate over the past half century both administrative data on the flow of new divorces and measures of the stock of divorcees from the census support this conclusion these results are suggestive of spouses bargaining within marriage with an eye to their partner s divorce threat

green goals and full employment are they compatible abstract two empirical correlations are studied one between economic growth and environmental impacts and the other between the lack of economic growth and unemployment it is demonstrated that at a global level economic growth is strongly correlated with environmental impacts and barriers to fast decoupling are large and numerous on the other hand low or negative growth is highly correlated with increasing unemployment in most market economies and strategies to change this lead to difficult questions and tradeoffs the coexistence of these two correlations which have rarely been studied together in the literature on green growth degrowth and a growth justifies ambivalence about growth to make key environmental goals compatible with full employment the decoupling of environmental impacts from economic output has to be accompanied by a reduction of dependence on growth in particular strategies to tackle unemployment without the need for growth several of which are studied in this article need much more attention in research and policy

panel tests of okun s law for ten industrial countries donald g freeman i introduction okun s law describes an empirical regularity between unemployment and real output growth each extra percentage point in the unemployment rate above four percent i e full employment has been associated with about a three percent decrement in real gnp okun 1962 9 1 okun s law has proved to be one of the more durable relationships in modern macroeconomics and is now often presented as an element of core beliefs as in textbooks by hall and taylor 1993 77 and in policy discussions by blinder 1997 durability and simplicity being relatively scarce commodities in macroeconomics okun s law is appealing as a shorthand guide to policy outcomes whether okun s law travels well is another question cross country comparisons of the relationship between unemployment and output have been estimated for other countries by knoester 1986 paldam 1987 and moosa 1997 among others but magnitudes vary depending on country and time period estimates in these papers of the increase in output growth associated with unemployment reduction of one percent range from a low of around two percent in the u s and canada to three to five percent in europe to more than 10 percent in japan with estimates for europe tending to be higher for more recent time periods because of the way that okun s law is framed tests of its proposition involve two imposing empirical problems first as usually stated the law refers to the relationship between departures of real gdp 2 and unemployment from their long run or equilibrium trends often referred to as potential gdp and the natural rate of unemployment respectively these equilibrium trends must be estimated either by time series methods as in moosa 1997 or by construction using a modified production function approach in which potential output is estimated using fully employed inputs as in gordon 1984 or adams and coe 1989 either of these fapproaches invites considerable criticism of assumptions and methods see for example the comments of clark 1984 and of baily 1984 on gordon 1984 second in formulating his law okun seems clearly not to be referring to a ceteris paribus relationship between changes in the unemployment rate and changes in real gdp writing later okun posited that other factors and inputs would be changing pari passu with employment the 3 percent result from a reduction of one percent in the unemployment rate implies that considerable output gains in a period of rising utilization rates stem from some or all of the following induced increases in the size of the labor force longer average weekly hours and greater productivity okun 1970 p 140 thus a complete specification of the effect of changing unemployment rates on output would include factors such as capital inputs labor hours and participation rates all measured as deviations from long run trends this article addresses these two obstacles by using a recent trend cycle decomposition developed by baxter and king 1999 to measure gaps in output unemployment capital stock and the labor force the baxter king bandpass filter extracts the trend component of economic time series by eliminating both high frequency those less than two years and low frequency more than eight years components it is both flexible and easy to implement by using the bandpass filter to filter all the time series using the same methodology this paper departs from previous research of prachowny 1993 and attfield and silverstone 1997 incorporating capital and labor to augment estimates of okun s law additionally using the bandpass filter allows the estimates in this article to incorporate more timely data reflecting the shift to lower levels of unemployment in the u s and higher levels of unemployment in europe and japan during the 1990s the latest year of observation for the constructed data sets of gordon and of adams and coe used for example by prachowny 1993 and attfield and silverstone 1997 is 1988

consumption smoothing and debtor protections abstract protections for defaulting debtors are a widely used form of consumption insurance this paper evaluates the costs and benefits of this insurance both inside and outside of bankruptcy first i show that consumption declines by 6 upon default revealing a potential role for greater debtor protections to smooth consumption second i use changes in states laws to estimate the impact of one type of debtor protection asset exemptions on repayment in default and interest rates while higher exemptions smooth consumption by reducing collection in default the interest rate cost is large relative to the benefits adapting a sufficient statistics formula from the literature the estimates imply that the cost of additional exemption protection exceeds what debtors are willing to pay

a classical model of the class struggle a game theoretic approach the class struggle is formalized as a differential game in a strictly supply side model an approach that synthesizes the models of lancaster and goodwin four different steady state equilibria are derived each corresponding to different assumptions about the degree to which each class is organized to promote its own interests in particular the goodwin growth cycle is shown to emerge from a world characterized by unorganized capitalists and workers in which individuals ignore the effects of their own actions on economywide variables more relevant for discussion of modern capitalism are the hierarchical equilibria especially the codetermination equilibrium in which the existence of a full employment equilibrium turns out to be problematic finally comparative statics results suggest that the incentives for technological change differ widely among the four regimes

power shifts the dynamics of energy efficiency induced technical change is crucial for tackling the problem of timing in environmental policy however it is by no means obvious that the state has the ability to impose its will concerning technical change on the other relevant actors therefore we conceptualize power in a non linear model with social conflict and induced technical change the model shows how economic growth business cycles and innovation waves interact in the dynamics of energy efficiency we assess three different ways of government control energy taxes energy and labor subsidies and energy caps energy taxes help to select more energy efficient technologies however a successful selection of such technologies presupposes that they are available in the pool of technologies as for energy subsidies their existence helps to explain why in contemporary economies labor productivity grows faster than energy efficiency with an energy cap the social network of the relevant agents may be stabilized via social norms it seems plausible that innovation waves comprise several business cycles and that such a wave is currently in the making proposals to postpone policies for improving energy efficiency increase the risk of energy inefficient lock in effects

economic growth and conflict over the distribution of income abstract a thorough analysis of economic growth inflation and fluctuations resulting from the class struggle is presented the paper begins with the formulation of an extended predator prey model and pays attention to population growth technical progress differential saving consumption out of wealth trade union activity inflation labour hoarding affluence and the inherent contradictions of capitalism the paper proceeds with a neo classical reformulation to allow for smooth substitution possibilities in production and for time taken to recruit and fire labour an alternative extension of the model based on maximising the reduction in unit costs subject to kaldor s technical progress function is also provided

from production based to consumption based national emission inventories abstract under the united national framework convention of climate change unfccc countries are required to submit national emission inventories nei to benchmark reductions in greenhouse gas ghg emissions depending on the definition and system boundary of the nei the mitigation options and priorities may vary the territorial system boundary used by the unfccc has been critiqued for not including international transportation and potentially causing carbon leakage to address these issues past literature has argued in favour of using consumption based nei in climate policy this article discusses several issues in moving from the standard production based nei to consumption based nei first two distinct accounting approaches for constructing consumption based nei are presented the approaches differ in the allocation of intermediate consumption of imported products second a consistent method of weighting production based and consumption based nei is discussed this is an extension of the previous literature on shared responsibility to nei third due to increased uncertainty and a wide system boundary it may be difficult to implement consumption based nei directly into climate policy several alternative options for incorporating consumption based inventories into climate policy are discussed

okun s law theoretical foundations and revised estimates okun s law has been accepted as an empirical regularity that predicts a 3 percentage point increase in output for every 1 point reduction in the unemployment rate but only because other facts such as weekly hours induced labor supply and productivity tend to rise as well when output gaps are estimated for the u s economy with a production function approach using two different data sets for potential output and nairu it is found that the marginal contribution of a 1 point reduction in unemployment is only about two thirds percent increase in output changes in weekly hours and capacity utilization have independent effects on the output gap copyright 1993 by mit press

okun s law and productivity innovations a long tradition in macroeconomics dating back to arthur okun 1965 and walter oi 1962 regards cyclical productivity fluctuations as an artifact a residual generated from the incomplete and lagged response of employment and labor hours to demand driven fluctuations in real output in okun s version a one percent decline in output relative to trend is divided up into a reduction of 1 3 point in productivity and 2 3 point in aggregate hours the latter is further subdivided into a reduction of 1 3 point in the employment rate with the remaining adjustment taking the form of lower hours per employee and in the labor force participation rate hereafter lfpr yet this tradition of regarding cyclical productivity fluctuations as a byproduct of demand driven output cycles has been almost forgotten over the past three decades as a result of widespread adoption of the real business cycle rbc model in which productivity shocks are treated as exogenous as unexplained as unrelated to aggregate demand and as the sole driver of business cycles even in the more enlightened modern macro work on dynamic stochastic general equilibrium models aggregate demand and sticky prices have reappeared but most recent papers still include an autonomous technology shock as one of several causes of short term business cycle fluctuations revisiting and rethinking the business cycle

bankruptcy as implicit health insurance this paper examines the implicit health insurance that households receive from the ability to declare bankruptcy exploiting multiple sources of variation in asset exemption law i show that uninsured households with a greater financial cost of bankruptcy make higher out of pocket medical payments conditional on the amount of care received in turn i find that households with greater wealth at risk are more likely to hold health insurance the implicit insurance from bankruptcy distorts the insurance coverage decision using a microsimulation model i calculate that the optimal pigovian penalties are three quarters as large as the average penalties under the affordable care act

the family as an incomplete annuities market families can self insure against uncertain dates of death through implicit or explicit agreements with respect to consumption and interfamily transfers interfamily transfers need have nothing to do with altruistic feelings they may simply reflect risk sharing behavior of completely selfish family members although family annuity markets are incomplete even small families can substitute by more than 70 percent for perfect market annuities given adverse selection and transaction costs family risk pooling may be preferred to public market annuities in the absence of public annuities these risk sharing arrangements provide powerful incentives for marriage and family formation

personal bankruptcy and credit supply and demand this paper examines how personal bankruptcy and bankruptcy exemptions affect the supply and demand for credit while generous state level bankruptcy exemptions are probably viewed by most policy makers as benefiting less well off borrowers our results using data from the 1983 survey of consumer finances suggest that they increase the amount of credit held by high asset households and reduce the availability and amount of credit to low asset households conditioning on observable characteristics thus bankruptcy exemptions redistribute credit toward borrowers with high assets interest rates on automobile loans for low asset households also appear to be higher in high exemption states

environment versus growth a criticism of degrowth and a plea for a growth in recent debates on environmental problems and policies the strategy of degrowth has appeared as an alternative to the paradigm of economic growth this new notion is critically evaluated by considering five common interpretations of it one conclusion is that these multiple interpretations make it an ambiguous and rather confusing concept another is that degrowth may not be an effective let alone an efficient strategy to reduce environmental pressure it is subsequently argued that a growth i e being indifferent about growth is a more logical social aim to substitute for the current goal of economic growth given that gdp per capita is a very imperfect indicator of social welfare in addition focusing ex ante on public policy is considered to be a strategy which ultimately is more likely to obtain the necessary democratic political support than an ex ante explicit degrowth strategy in line with this a policy package is proposed which consists of six elements some of which relate to concerns raised by degrowth supporters

consumer bankruptcy a fresh start consumer bankruptcy provides partial insurance against bad luck but by driving up interest rates makes life cycle smoothing more difficult we argue that to assess this trade off one needs a quantitative model of consumer bankruptcy with three key features life cycle component idiosyncratic earnings uncertainty and expense uncertainty exogenous negative shocks to household balance sheets we find that transitory and persistent earnings shocks have very different implications for evaluating bankruptcy rules more persistent shocks make the bankruptcy option more desirable larger transitory shocks have the opposite effect our findings suggest the current us bankruptcy system may be desirable for reasonable parameter values jel d14 d91 k35

understanding carbon lock in abstract this paper narrative argues that industrial economies have been locked into fossil fuel based energy systems through a process of technological and institutional co evolution driven by path dependent increasing returns to scale it is asserted that this condition termed carbon lock in creates persistent market and policy failures that can inhibit the diffusion of carbon saving technologies despite their apparent environmental and economic advantages the notion of a techno institutional complex is introduced to capture the idea that lock in occurs through combined interactions among technological systems and governing institutions while carbon lock in provides a conceptual basis for understanding macro level barriers to the diffusion of carbon saving technologies it also generates questions for standard economic modeling approaches that abstract away technological and institutional evolution in their elaboration the question of escaping carbon lock in is left for a future paper

endogenous technical change with externalities in a classical growth model abstract a growth model with three inputs capital labor and land extends foley and michl s d foley t r michl s growth and distribution harvard university press cambridge ma 1999 classical accumulation model by adding a goodwin r goodwin a growth cycle in c h feinstein ed socialism capitalism and economic growth cambridge university press cambridge 1967 labor market and a model of endogenous technical change that can represent either dumenil and levy s metroeconomica 46 1995 213 j econ behav org this issue or kennedy s econ j 74 295 1964 541 models when land is priced there is a stable steady state growth path with desirable allocational properties when land is not priced no steady state exists and the growth path leads to a catastrophe these results hold when the elasticity of substitution between capital and labor is less than unity

marriage and divorce reply in the popular press and among policymakers the effect of no fault divorce laws on divorce rates remains an issue see e g new york times 23 july 1991 in my 1986 article in this review i show that the adoption of one form of no fault divorceunilateral divorce does not lead to a significant increase in divorce rates the theoretical model that is consistent with this empirical evidence would imply that the new law does not decrease the costs of divorce it merely redefines which party has the right to terminate the marriage

working time reduction policy in a sustainable economy criteria and options for its design abstract reducing per capita consumption particularly amongst high income groups is often deemed necessary to reduce the environmental impacts of the global economy far from implying a necessary reduction in wellbeing some research suggests this could actually improve it as reduced expenditure means a reduced need for income and hence paid work then there is the possibility for average working hours to fall providing increased leisure time in which to pursue happiness through less consumption intensive but more time consuming ways to date however there has been little critical discussion of the details of what policy might need to cover to allow and encourage substantial working time reduction in a way that successfully reconciles these environmental and wellbeing goals this article addresses this gap in the literature it begins by reviewing the conditions under which working time reduction could bring environmental and wellbeing benefits it then presents examples of innovative voluntary working time policies from the netherlands and belgium drawing these elements together the article presents a new green life course approach for working time policy design it argues that as a complement to more conventional working time policies this could be a valuable tool to combine environmental and wellbeing goals

goodwin s mks system a baseline macro model we extend goodwin s distributive cycle by effective demand forces and endogenous process innovations driven by the evolution of the employment rate of workers in the sphere of production and its consequences for the income distribution between capital and labour we show that the extended dynamics can create persistent fluctuations in employment income distribution and productivity growth if their balanced growth path is surrounded by an unstable multiplier accelerator process a basic variant of its well known goodwin formulation our integration of global stability through a marxian reserve army mechanism with locally destabilising keynesian demand and schumpeterian process innovations provides a basic model of what goodwin describes as the mks system approach to the understanding of the evolution of capitalism

pseudo goodwin cycles in a minsky model goodwin cycles result from the dynamic interaction between a profit led demand regime and a reserve army effect in income distribution the paper proposes the concept of a pseudo goodwin cycle we define this as a counter clockwise movement in output and wage share space which is not generated by the usual goodwin mechanism in particular it does not depend on a profit led demand regime to illustrate this a simple minsky type model is extended by a reserve army distribution adjustment in this model the cycle is generated by the interaction of financial fragility and demand the wage share rises at higher levels of output but this generates no feedback so that by design demand does not react to changes in income distribution but the model does exhibit a pseudo goodwin cycle in the output wage share space this holds true even if we introduce a wage led demand regime this demonstrates that the existence of a counter clockwise movement of output and the wage share cannot be regarded as proof of the existence of a goodwin cycle and a profit led demand regime

the economics of degrowth economic degrowth is ecologically desirable and possibly inevitable but under what conditions can it become socially sustainable how can we have full employment and economic stability without growth what will happen to public spending and to public debt how would production be organised in a degrowing economy and under what plausible socio political conditions could such grand changes happen standard economic theories and models ignore these questions for them economic growth is an axiomatic necessity this article reviews recent contributions in the economics of degrowth and identifies research avenues for ecological economists

an analysis on the structural stability of okun s law a cross country study okun s law postulates an inverse relationship between movements of the unemployment rate and the real gross domestic product gdp this article investigates okun s law for 15 oecd countries and checks for its the structural stability by using data on employment and the labour force whether structural instability is caused either from the demand side or supply side is inferred

did unilateral divorce raise divorce rates evidence from panel data since early 1996 at least eight states have begun to consider rolling back unilateral and no fault divorce a major reversal of the liberalizing trend in divorce laws which began around 1970 the proponents of tightening the divorce regime often argue that making divorce more difficult will strengthen families however both theoretical and empirical evidence is decidedly mixed over whether the no fault revolution actually contributed to the sharp increase in divorce rates in the united states observed over the last 30 years in this paper i address the dispute by using a panel of state level divorce rates including state specific trends allows unobserved state divorce propensities to trend linearly and even quadratically over time and reveals that unilateral divorce raised divorce rates significantly and strongly excerpt

environmental awareness consumption and labor supply empirical evidence from household survey data abstract what is the effect of environmental awareness on the households consumption of polluting goods and labor supply decisions we answer this question using household survey data from the united states and measuring environmental awareness with the decision to make environmental donations we find that environmental awareness has a negative and economically significant effect on labor supply the respective impact on the consumption of polluting goods is also negative but less robust in terms of statistical significance our results highlight the importance of understanding the foundations of household behavior related to environmental quality indeed environmentally aware households are willing to tradeoff work hours with improved environmental quality and less so to change their consumption habits

okun s law asymmetries and jobless recoveries in the united states a markov switching approach abstract prevailing markov regime switching approaches to asymmetries in okun s law assume either asymmetry between unemployment and output across regimes or asymmetry within a regime we combine both approaches and give an insight into the 1991 and 2001 united states jobless recoveries

re spending rebound a macro level assessment for oecd countries and emerging economies abstract it is well known that energy conservation can lead to rebound effects that partly offset the original energy savings one particular rebound mechanism is re spending of money savings associated with energy savings on energy intensive goods or services we calculate the average magnitude of this re spending rebound for different fuels and countries and for both energy and carbon co2 emissions we find that emerging economies neglected in past studies typically have larger rebounds than oecd countries since such economies play an increasingly important role in the global economy the re spending rebound is a growing concern the re spending effect is generally larger for gasoline than for natural gas and electricity paradoxically stronger financial incentives to conserve energy tend to increase the rebound this suggests that with climate regulation and peak oil the re spending rebound may become more important we discuss the policy implications of our findings

growth in global materials use gdp and population during the 20th century the growing industrial metabolism is a major driver of global environmental change we present an assessment of the global use of materials since the beginning of the 20th century based on the conceptual and methodological principles of material flow accounting mfa on the grounds of published statistical data data compilations and estimation procedures for material flows not covered by international statistical sources we compiled a quantitative estimate of annual global extraction of biomass fossil energy carriers metal ores industrial minerals and construction minerals for the period 1900 to 2005 this period covers important phases of global industrialisation and economic growth the paper analyses the observed changes in the overall size and composition of global material flows in relation to the global economy population growth and primary energy consumption we show that during the last century global materials use increased 8 fold humanity currently uses almost 60 billion tons gt of materials per year in particular the period after wwii was characterized by rapid physical growth driven by both population and economic growth within this period there was a shift from the dominance of renewable biomass towards mineral materials materials use increased at a slower pace than the global economy but faster than world population as a consequence material intensity i e the amount of materials required per unit of gdp declined while materials use per capita doubled from 4 6 to 10 3 t cap yr the main material groups show different trajectories while biomass use hardly keeps up with population growth the mineral fractions grow at a rapid pace we show that increases in material productivity are mostly due to the slow growth of biomass use while they are much less pronounced for the mineral fractions so far there is no evidence that growth of global materials use is slowing down or might eventually decline and our results indicate that an increase in material productivity is a general feature of economic development

okun s law in panels of countries and states this article contributes to the empirical literature of okun s law in three respects first in contrast to the limited data used in the existing studies we employ two extensive across countries and across states i e within a country panel data sets to investigate the validity of okun s law second the use of the pooled mean group pmg estimator permits us not to pre filter the data as often done in the current literature and can take into account the possibility of cointegration between unemployment and output third in addition to the short run relationship or cyclical components between unemployment and output we also estimate the long run linkage between these two important variables empirical results show that unemployment and output are long run cointegrated irrespective of using country or state level data moreover the unemployment output linkages are found to be negative and highly significant both in the short and long run our results not only confirm the validity of okun s law

economic growth trade and energy implications for the environmental kuznets curve abstract the environmental kuznets curve ekc hypothesis asserts that pollution follows an inverted u path with respect to economic growth the ekc has been explained in terms of structural changes in the composition of economic output and increased environmental regulation at higher income levels while some authors have incorporated the impact of trade policy orientation on the ekc the impact of the actual movement between countries of goods that embody pollution has not been considered this paper attempts to econometrically quantify the effect using pooled cross country and time series data the ekc hypothesis is examined with respect to commercial energy consumption the source of many serious environmental problems it was found that while both industrializing and industrialized countries have added to their energy requirements by exporting manufactured goods the growth has been substantially higher in the former at the same time industrialized countries have been able to reduce their energy requirements by importing manufactured goods exports of manufactured goods by industrialized countries has thus been an important factor in generating the upward sloping portion of the ekc and imports by industrialized countries have contributed to the downward slope

ghg emissions gdp growth and the kyoto protocol a revisit of environmental kuznets curve hypothesis abstract the kyoto protocol attempts through political negotiations to guide participating industrialized countries greenhouse gas ghg emissions from a positive growing trend to reach a peak point or turning point and then be reduced to a negative growth that means the relationship between decreasing ghg emissions and economic growth may be described by an inverted u curve or called a bell shaped curve which is consistent with the concept of the environmental kuznets curve ekc hypothesis this research observed that the economic development and ghg emissions in economies in transition eits exhibit a hockey stick curve trend or called quasi l shape curve that also generates a lot of hot air which is significant to the implementation of the kyoto protocol in addition through the analysis of single country time series data and gdp data this research demonstrated that statistical data for most of the annex ii countries do not possess evidence that supports the ekc hypothesis for ghg emissions the results from this study also indicated that the 38 industrialized countries are unable to meet their targets under the kyoto protocol within the specified time period which are probably caused by the econometric method s inability to predict accurately the extents and development of innovative technologies and clean development mechanism cdm projects if the international community truly wants to reduce the ghg emissions the effectiveness of the existing international framework for emissions reduction needs to be reconsidered seriously and the global cooperation mechanism also needs to be greatly enhanced

divorce rates and bankruptcy exemption levels in the united states abstractalthough increasing bankruptcy exemption levels protects consumers from negative asset shocks an unintended consequence of this policy that remains unexplored is the effect on divorce rates this effect arises from reducing the benefits of marital risk sharing i establish conditions under which increases in exemption levels lead to more divorce and investigate using data from vital statistics of the united states i estimate that increases in exemption levels occurring between 1989 and 2005 resulted in more than 200 000 additional divorces during this period and that the effect on divorce rates in 2005 is comparable in magnitude to that found for the introduction of unilateral divorce laws by wolfers

law property and marital dissolution this paper challenges the view that legal rights are not important in affecting whether people divorce but it puts as much emphasis on property rights given for example by the law on alimony as on dissolution rights in the united states the paper sets out two stylised models of marriage and examines the consequences of fuller compensation for economic sacrifices made during marriage if the dominant economic issue in a marriage is who undertakes household tasks then a law giving fuller compensation makes divorce more likely if the dominant issue is child custody divorce is less likely excerpt

growth cycles with induced technical change this paper concerns itself with two related topics the relative shares of workers and capitalists in the national income and the labour augmenting bias of technical change both have been dealt with in contrasting fashion in two seminal papers on distribution theory kennedy i964 attempts to explain the then observed constancy of relative shares with the help of the now famous invention possibility frontier however the wage and profit rates are exogeneous to his model goodwin i967 on the other hand presents a model of cycles in growth rates in which the share of labour the wage rate and the profit rate are endogenously determined however unlike the kennedy analysis technical change is assumed to be constant and exogeneously given given that these pioneering works have addressed themselves to important questions it seems a worthwhile task to build a model in which the shares of labour and capital the wage rate the profit rate and technical change are all endogenously determined the perspective we have chosen here introduces the key element of kennedy s perception induced technical change into the goodwin scheme and the consequences of so doing are traced out in the following terse account there are two classes in the economy workers and capitalists only one good q t is produced and it can be either consumed or invested capital stock k t is homogeneous and for simplicity also assumed to be non depreciating the capital output ratio at time t is denoted by o t labour i t is also homogeneous and its productivity at time t a t q t l t improves at the rate ac t labour s share in the national income denoted by u t is

the relationship between production and unemployment in japan okun s law in comparative perspective abstract this paper studies the question whether the celebrated okun s law a relation between excess capacity and unemployment applies to the postwar japanese economy though the fitness of estimation is weak the coefficient that measures the responsiveness of the output gap to the unemployment rate is very large reaching 28 this large coefficient can be attributed to the elastic response in the female participation ratio to flexible working hours to the slow adjustment in employment and to changes in industrial structures the results are compared with those in the united states

the household bankruptcy decision personal bankruptcy filings have risen from 0 3 percent of households per year in 1984 to around 1 35 percent in 1998 and 1999 transforming bankruptcy from a rare occurrence to a routine event lenders lost about 39 billion in 1998 due to personal bankruptcy filings but economists have little understanding of why households file for bankruptcy or why filings have increased so rapidly until very recently studying the household bankruptcy decision was very difficult because no household level data set existed that included information on bankruptcy filings in this paper we use new data from the panel study of income dynamics which includes information on bankruptcy filings to estimate a model of households bankruptcy decisions we find support for the strategic model of bankruptcy which predicts that households are more likely to file when their financial benefit from filing is higher our model predicts that an increase of 1 000 in households financial benefit from bankruptcy would result in a 7 percent increase in the number of bankruptcy filings our model also predicts that if the 1997 national bankruptcy review commission s proposed changes in bankruptcy exemption levels were implemented there would be a 16 percent increase in the number of bankruptcy filings each year but if the 100 000 cap on homestead exemptions recently passed by the u s senate were adopted our model predicts that there would be only a negligible effect on the number of filings we find little support for the nonstrategic model of bankruptcy which predicts that households file when adverse events occur which reduce their ability to repay finally controlling for state and time fixed effects our model shows that households are more likely to file for bankruptcy if they live in districts with higher aggregate filing rates

is the environmental kuznets curve for deforestation a threatened theory a meta analysis of the literature abstract although widely studied deforestation remains a common research topic the relationship between economic development and deforestation is still in question this paper presents a meta analysis of environmental kuznets curve ekc studies for deforestation using 69 studies offering 547 estimations we shed light on why ekc results differ we investigate the incidence of choices made by authors such as econometric strategy measure of deforestation geographical area and presence of control variables on the probability of finding an ekc after a phase of work corroborating the ekc we find a turning point after the year 2001 building on our results we conclude that the ekc story will not fade until theoretical alternatives are provided

is there a core of practical macroeconomics that we should all believe with emphasis on the adjective practical and the normative verb should my answer to the question of this session is a resounding yes indeed i spent a good deal of time between january 1993 and january 1996 acting on the belief that there is such a core macro model so i certainly hope it exists this believable core model falls well short of perfection leaves many questions unanswered and is subject to substantial stochastic errors nonetheless it is both useful and extensively used in policy analysis where contact with reality is a necessity and you cannot beat something with nothing it also closely resembles but does not quite match the way macroeconomics is taught to beginning and intermediate but not to graduate students in this short presentation i will describe briefly the main practical elements that i think we should agree on without worrying too much about their theoretical underpinnings then i will turn to two critical failings of the standard macro model which cry out for theoretical and empirical repair my organizing principle is the textbook exposition that has been standard though not universal in teaching intermediate macroeconomics for years the question is how does it differ from the core model used in policy analysis

marriage and divorce informational constraints and private contracting the relationship between divorce rates in the united states and laws regulating divorce are analyzed using data from a special current population survey undertaken in 1979 with particular reference to the adoption by many states of no fault divorce laws the author utilizes a contract theoretic framework to examine the impact of both legal and informational constraints on several aspects of the marriage relationship 1 the probability of divorce 2 compensation at divorce i e the terms of the divorce settlement 3 the probability of entering marriage and 4 incentives for investment in marriage specific capital two different models are developed the first assumes that ex post information about the value of each spouses opportunites at divorce is symmetric and that since divorce would only occur if the joint benefits outweigh the joint costs the law has no effect on the divorce rate the second model asserts that the existence of asymmetric information results in a fixed wage marriage contract and that divorce would be higher in states that allow unilateral divorce the evidence supports the first of these hypotheses excerpt

the impact of tfp growth on steady state unemployment theoretical predictions of the impact of total factor productivity tfp growth on unemployment are ambiguous and depend on the extent to which new technology is embodied in new jobs we evaluate a model with embodied and disembodied technology capitalization and creative destruction effects in econometric estimates with a panel of industrial countries we find a large negative impact of tfp growth on unemployment which implies that embodied technology and creative destruction play no role in the steady state dynamics of unemployment capitalization effects explain some of the estimated impact but a part remains unexplained

growth degrowth and climate change a scenario analysis article i nfo article history the paper proceeds with a discussion of the interplay of scale and intensity in determining greenhouse gas emissions this is followed by the presentation of several macroeconomic scenarios using lowgrow a simulation model of the canadian economy the scenarios considered are business as usual which is a projection into the future of past trends selective growth in which differential growth rates are applied to parts of the economy according to their direct and indirect greenhouse gas emissions and degrowth where the average gdp capita of canadians is reduced towards a level more consistent with a world economy the size of which respects global environmental limits the paper ends with a comparison of the scenarios 2011 published by elsevier b v

marriage and divorce comment the author comments on an article by h elizabeth peters concerning the impact of state laws particularly no fault divorce laws on divorce rates in the united states a reply by peters is included pp 686 93 annotation

taking the u out of kuznets a comprehensive analysis of the ekc and environmental degradation unlike most environmental kuznets curve ekc studies which focus on narrow measures of pollution as proxies for environmental quality we test the validity of the ekc using the ecological footprint ef a more comprehensive measure of environmental degradation we find no empirical evidence of an ekc relationship between the ef and economic development and only limited support for such a relationship among the components of the ef in addition we discover that energy is largely responsible for the lack of an ekc relationship and that energy consumption levels would have to be cut by over 50 in order for a statistically significant ekc relationship to emerge from the data overall these results suggest that growth alone will not lead to sustainable development

strategic or nonstrategic the role of financial benefit in bankruptcy i introduction personal bankruptcy rates have increased at an annual rate of 3 9 since 1990 from about 718 thousand non business bankruptcies in 1990 to about 1 5 million in 2010 partly as a response to this increase the congress passed the bankruptcy abuse prevention and consumer protection act bapcpa of 2005 the largest overhaul of bankruptcy laws since 1980 although recent data are too sparse to determine the longer term effectiveness of the law we know that there was a spike in bankruptcy filings in 2005 just before the law took effect on october 17 2005 and a corresponding decline in 2006 since then bankruptcies have continued to rise reaching a level of about 1 5 million in 2010 the same level as in 2004 the bankruptcy rate has also begun to creep up to the earlier levels one of the major purposes of the new bankruptcy law was to cut down on abusive or fraudulent uses of the bankruptcy system or in other words strategic use of the law therefore it is important to understand the motivations of consumers who file for bankruptcy what constitutes strategic use of bankruptcy law and how widespread is its incidence in the literature there is no clear definition of what constitutes a strategic bankruptcy filing we shall consider strategic behavior to be a conscious decision to benefit from bankruptcy law to make this tractable consider a simple two period model of decision making in the first period consumers receive a noisy signal of experiencing a financial shock in the second period based on this signal consumers may update their probability of an adverse shock and choose their debt level in the second period the shock is realized and consumers decide whether to file for bankruptcy or not a strategic consumer is one who in the first period chooses her debt level after conditioning on the signal that is a strategic consumer takes on debt after accounting for the chance of filing for bankruptcy in other words a strategic consumer is one who is fully rational and takes decisions to maximize her benefit a nonstrategic consumer is one who chooses debt level without conditioning on the signal he plans to repay his debt in the absence of adverse events such a consumer is myopic and may be exhibiting rational inattention as described below consistent with this view we may distinguish between strategic and nonstrategic behavior by testing whether consumers make their debt and filing decision jointly or not strategic behavior is consistent with a joint decision whereas nonstrategic behavior is not in terms of empirical strategy this is implemented by testing whether financial benefit is endogenous to the filing decision or not our test is different from the one in the study by fay hurst and white 2002 henceforth fhw in that approach a positive relationship between filing for bankruptcy and financial benefit from filing ceteris paribus is taken as evidence of strategic behavior and a positive relationship between filing for bankruptcy and adverse events such as divorce health shocks employment shocks etc is taken as evidence of nonstrategic behavior using data from the panel study of income dynamics psid fhw show that financial benefit is positively and significantly related to the filing decision and after controlling for financial benefit adverse event variables do not affect the bankruptcy decision except for a marginally significant positive effect of divorce 1 this simple empirical relationship between bankruptcy filing and financial benefit does not consider more realistic relationships among financial benefit adverse events and strategic behavior for example financial benefit from filing may go up due to adverse events regardless of whether a consumer is trying to abuse bankruptcy law or not that is financial benefit goes up when a consumer consciously increases unsecured debts before filing consistent with strategic behavior and it also goes up when she uses unsecured debt e

more leisure or higher pay a mixed methods study on reducing working time in austria working time reduction has become a central topic in the debate on social ecological transformation as it has the potential to mitigate unemployment improve well being and reduce environmental pressures this article analyses which groups of employees want to reduce their working time and for which reasons a novel working time policy in austria the leisure option provides a unique possibility to examine this question this policy enables employees to choose between a wage increase and more leisure time we use a mixed methods approach to analyse employees preferences and the decision to reduce working time with two empirical parts run in parallel a binary logit regression based on austrian microcensus 2012 data investigates factors associated with a preference for reduced working time qualitative interviews are conducted among employees at a firm in the electronics industry that offers the leisure option our results suggest that working time preferences are to a large extent shaped by social norms such as the full time working norm and gender roles we also find that the desire to work less is strongly moulded by personal values placed either on leisure and family time or on financial security

goodwin cycles and the bopc growth paradigm a macrodynamic model of growth and fluctuations abstract the paper builds a non linear macrodynamic model to study the relation between the functional distribution of income technological progress and economic growth in the short term the interaction between the productivity regime the demand regime and the distributive conflict generates cyclical paths a la goodwin in the long term output growth rate is constrained by the balance of payments a la thirlwall in which the elasticities of foreign trade are modeled as a function of the complex relation between the wage share and the innovation capabilities of theeconomy

a further critique of growth economics is aggregate physical growth still economic as it was in the empty world or has it become uneconomic as we have moved into the full world era first i discuss why this critical question has been ignored by mainstream economists and policy makers second i consider 11 fallacies or anomalies that confuse reasoning about economic growth and undercut the current policy presumption in its favor

the economics of the marriage contract theories and evidence abstract we analyze the role of the marriage contract we first formalize three prominent hypotheses on why people marry marriage provides an exogenous payoff to married partners it serves as a commitment device and it serves as a signaling device for each theory we analyze how a reduction in the costs of divorce affects the propensity to divorce for couples at any given duration of marriage we then use individual marriage and divorce certificate data from the united states to bring these alternative views of the marriage contract to bear on the data we exploit variations in the timing of the adoption of unilateral divorce laws across states to proxy a one off and permanent reduction in divorce costs the results suggest that the dominant reason that couples enter into a marriage contract is that it serves as a commitment device

the political economy of property exemption laws abstract exemption laws enable people who default on loans to protect certain assets from liquidation every state has its own set of exemption laws and they vary widely the 1978 federal bankruptcy law contains a set of national exemptions which debtors in bankruptcy are permitted to use instead of their state s exemptions unless the state has formally opted out of the federal system we contend that states decisions to opt out shed light on their exemption levels we find that states are more likely to opt out if their state exemption is lower than the federal exemption and that states are more likely to opt out if they also have a high bankruptcy filing rate and transfer little money to the poor these latter findings suggest that studies that examine the impact of exemptions on for example the bankruptcy rate should not treat exemption levels as exogenous variables

work sharing during the great depression did the president s reemployment agreement promote reemployment the president s reemployment agreement pra of 1933 directed firms to reduce workweeks during the great depression so existing jobs could be spread into additional employment opportunities similar work sharing policies have recently been implemented across europe in hopes of reducing unemployment i find that ceteris paribus the work sharing aspects of the pra created nearly 2 5 million new employment opportunities in around four months however the programme also required firms to raise hourly wage rates offsetting close to half of these gains furthermore most of the remaining employment gains were wiped out after cartel oriented industry specific codes of fair competition supplanted the pra

the sufficiency strategy would rich world frugality lower environmental impact abstract one alleged weapon against unsustainable environmental impact is for the wealthy to consume less this sufficiency strategy is to complement the efficiency strategy of lowering ratios of resource inputs to economic outputs the former would reduce the affluence factor in i pat the latter the technology factor that the latter strategy suffers from a consumption rebound is widely recognized this paper identifies a similar rebound when the affluence factor is autonomously lowered the lower initial demand lowers prices which in turn stimulates new demand by others the strategy moreover addresses only the rich raising questions of its theoretical maximum efficacy its proponents usually conflate frugality with the north south dichotomy and intra generational with inter generational equity moreover there are difficulties with the supporting arguments that frugality is good for one s own sake as well as for the environment and that the rich should lead the way to living more lightly personal behaviour change is furthermore not a substitute for international political efforts finally since all changes in right side factors of the i pat equation change other right side factors such indirect attacks on impact should be abandoned in favor of supply and emissions quotas