cash transfer programs with income multipliers procampo in mexico abstract cash transfer programs create multiplier effects when recipients put the money they receive to work to generate further incomes when this is the case the ultimate income effects are multiples of the amounts transferred we analyze the procampo program in mexico that was introduced to compensate farmers for the anticipated negative effect of nafta on the prices of basic crops the transfer rules and the timing of the panel data collected allow unique control of biases in this impact analysis we find that the multiplier among ejido sector recipients is in the range 1 5 2 6 multipliers are higher for households with medium and large farms low numbers of adults in the household nonindigenous backgrounds and located in the center and gulf regions high multipliers reflect income opportunities that had remained unrealized due to liquidity constraints that are relaxed by the transfers opportunities come from the asset endowments that these households received through the land reform particularly irrigated land and they are enhanced by access to technical assistance

piketty and the growth dilemma revisited in the context of ecological economics 2017 elsevier b v piketty s capital has provoked considerable debate regarding inequality the existence of increasing inequality creates a challenge for ecological economics in this paper we set out some of the problems inherent in piketty s approach and how they are addressed from the point of view of ecological economics we use jackson and victor s response as a point of departure to make several points piketty s work involves an unreconciled inconsistency between his laws and the institutional context which becomes problematic when one starts to think about inevitability he simply assumes away ecological problems to make future forecasts for inequality as such his forecasts are undermined since ecological issues are fundamental to any viable future economy furthermore piketty effectively reproduces rather than contests the mainstream practice of delegating ecological issues to a sub discipline jackson and victor meanwhile focus on the mainstream economic aspect of piketty s work and construct a model to contest a model in so doing they provide an ideational response to what is also a problem of ideological frameworks though it can be important to contest an idea they inadvertently through family resemblance contribute to the reproduction of the problematic position of ecological concerns within dominant ways of conceiving economics

forward looking contrast explanation illustrated using the great moderation in reorienting economics lawson introduces the concept of contrast explanation initially defined using the question form why x rather than y where it is a surprising or unexpected outcome that motivates the search for an explanation of the contrast in the following paper i elaborate upon the initial question form asking why the perpetuation of y rather than an alternative possible x this question focuses on relative stability but can be a sceptical or contrarian form from a realist perspective any stability expressed in events as regularity is highly conditional as such underlying the question form is an invitation to explore the instability or vulnerability of order with a view to the ways that order might break down this motivates a forward looking focus of investigation that is particularly appropriate for looking at systemic issues in economics i use the global financial crisis to illustrate the potential here copyright oxford university press

contrast explanation in economics its context meaning and potential in this article we place tony lawson s account of contrast explanation in context lawson s development of it is given meaning both by the roots of the approach in his work on social ontology and the state of economics that provides the grounds for the critique contained in that social ontology this is important because such an approach to explanation is not new most notably van fraassen and garfinkel have developed it in particular ways and for particular purposes within the philosophy of science and social theory setting out the different ways in which the contrastive approach has been developed is useful for identifying what is different about lawson s approach its potential and limits lawson s proposal is more modest and focusses on causal investigation in a manner that flows from his approach to social ontology contrast explanation provides a substitute for controlled experiments and facilitates identifying social mechanisms it also enables exploration of the manifold presuppositions of our explanatory questions we argue that this is a useful and important contribution to overcoming some of the many problems economics faces

from maize to haze agricultural shocks and the growth of the mexican drug sector understanding how economic incentives affect illegal drug production is essential for crafting policies in response to the international drug trade policymakers typically face a choice between two strategies targetingcriminalgroupsvialawenforcement andofferingproducersincentivestoengage in alternate activities yet little is known about how the returns to alternate legal activities affect drug supply we contribute to this literature by examining how shocks to legal commodity prices affect the drug trade in mexico our analysis exploits exogenous movements in the mexican maize price stemming from weather conditions in u s maize growing regions as well as exports of other major maize producers using data on over 2200 municipios spanning 1990 2010 we show that lower prices differentially increased the cultivation of both marijuana and opium poppies in municipios

the dismantling of conasupo a mexican state trader in agriculture in the 1990s mexico gradually dismantled and ultimately liquidated conasupo its state enterprise in agriculture conasupo was a typical less developed country ldc parastatal exacting control over an important component of mexico s food chain this paper examines the demise of conasupo in the context of domestic economic reforms and trade liberalisation it documents the process by which conasupo was eleminated the political environment that made this possible and the implications for agricultural production and trade the paper concludes by distilling lessons from mexico s experience for other ldcs as the liberalisation of domestic and international markets continues to unfold

macroeconomics after the crisis time to deal with the pretense of knowledge syndrome the recent financial crisis has damaged the reputation of macroeconomics largely for its inability to predict the impending financial and economic crisis to be honest this inability to predict does not concern me much it is almost tautological that severe crises are essentially unpredictable for otherwise they would not cause such a high degree of distress what does concern me about my discipline is that its current core by which i mainly mean the so called dynamic stochastic general equilibrium approach has become so mesmerized with its own internal logic that it has begun to confuse the precision it has achieved about its own world with the precision that it has about the real one this is dangerous for both methodological and policy reasons to be fair to our field an enormous amount of work at the intersection of macroeconomics and corporate finance has been chasing many of the issues that played a central role during the current crisis including liquidity evaporation collateral shortages bubbles crises panics fire sales risk shifting contagion and the like however much of this literature belongs to the periphery of macroeconomics rather than to its core i will discuss the distinction between the core and the periphery of macroeconomics as well as the futile nature of the integrationist movement that is the process of gradually bringing the insights of the periphery into the dynamic stochastic general equilibrium structure i argue that the complexity of macroeconomic interactions limits the knowledge we can ever attain and that we need to place this fact at the center of our analysis we should consider what this complexity does to the actions and reactions of the economic agent and seek analytical tools and macroeconomic policies that are robust to the enormous uncertainty to which we are confined

the uk research assessment exercise and the narrowing of uk economics the aim of this paper is to delineate an empirically grounded structure causal going concern recursive model of uk economics that in the context of the rae and local department decision making explains the progressive elimination of heterodox economics the progressive homogenization of mainstream economics from 1992 to the present and the continued rise to dominance of a select group of departments and indicates whether these regularities will continue under the research excellence framework selectivity exercise in 2014

intergenerational transfers as social insurance abstract in an overlapping generations model with stochastic population changes a social security scheme with a fixed level of payments to the retired can be interpreted as providing social insurance against the risks of demographic change

tantalus on the road to asymptopia my first reaction to the credibility revolution in empirical economics authored by joshua d angrist and jorn steffen pischke was wow this paper makes a stunningly good case for relying on purposefully randomized or accidentally randomized experiments to relieve the doubts that afflict inferences from nonexperimental data on further reflection i realized that i may have been overcome with irrational exuberance moreover with this great honor bestowed on my con article i couldn t easily throw this child of mine overboard as angrist and pischke persuasively argue either purposefully randomized experiments or accidentally randomized natural experiments can be extremely helpful but angrist and pischke seem to me to overstate the potential benefits of the approach i begin with some thoughts about the inevitable limits of randomization and the need for sensitivity analysis in this area as in all areas of applied empirical work i argue that the recent financial catastrophe is a powerful illustration of the fact that extrapolating from natural experiments will inevitably be hazardous i discuss how the difficulties of applied econometric work cannot be evaded with econometric innovations offering as examples some under recognized difficulties with instrumental variables and robust standard errors i conclude with comments about the shortcomings of an experimentalist paradigm as applied to macroeconomics and some warnings about the willingness of applied economists to apply push button methodologies without sufficient hard thought regarding their applicability and shortcomings

managing food price risks and instability in a liberalizing market environment overview and policy options abstract managing food price risks and instability is a major challenge in the midst of ongoing food market reforms key findings from the papers in this special volume revolve around five broad areas i the sources and magnitudes of food price instability in different country contexts ii the economic and social costs stemming from price instability iii the lessons from food market reforms to date iv the design of policy reforms in ways that promote efficient and stable market development and protect the interests of the poor and v potential policy responses to food price instability in a liberalizing market environment

intergenerational risk sharing abstract in this paper we examine government debt and tax transfer policies that can be improve the allocation of risk between generations markets cannot allocate risk efficiently between two generations whenever the two generations are not both alive prior to the occurence of a stochastic event this implies that government policies transferring risk between generations have the potential to create first order welfare improvements our model provides a non keynesian justification for the debt finance of wars and recessions as well as an added rationale for social security type tax transfer schemes which aid unlucky generations e g the depression generation at the expense of luckier generations

the credibility revolution in empirical economics how better research design is taking the con out of econometrics since edward leamer s memorable 1983 paper let s take the con out of econometrics empirical microeconomics has experienced a credibility revolution while leamer s suggested remedy sensitivity analysis has played a role in this we argue that the primary engine driving improvement has been a focus on the quality of empirical research designs the advantages of a good research design are perhaps most easily apparent in research using random assignment we begin with an overview of leamer s 1983 critique and his proposed remedies we then turn to the key factors we see contributing to improved empirical work including the availability of more and better data along with advances in theoretical econometric understanding but especially the fact that research design has moved front and center in much of empirical micro we offer a brief digression into macroeconomics and industrial organization where progress by our lights is less dramatic although there is work in both fields that we find encouraging finally we discuss the view that the design pendulum has swung too far critics of design driven studies argue that in pursuit of clean and credible research designs researchers seek good answers instead of good questions we briefly respond to this concern which worries us little

population uncertainty social insurance abstract uncertainty in the size of the working population leads to uncertainty in wages and in the return to capital and to the possible desirability of an insurance contract between unborn workers and future retirees however green 1977 1988 finds that an insurance contract is unlikely to benefit both generations we show that a worker has two potential sources of actuarial bias green s result is due to workers in his model being of different types and some workers having only one source of bias a representative worker must have both sources of bias and an insurance contract will benefit both generations the results are generalized

applied economics contrast explanation and asymmetric information the purpose of this paper is to illustrate the workings of an explanatory method for applied economics it is a method that is rarely explicitly examined or defended in the discipline but which i believe has a lot of promise for the sorts of contexts that economists must address my strategy is to show that and how the method in question effectively underpins at least one study already widely regarded as explanatorily successful copyright the author 2008 published by oxford university press on behalf of the cambridge political economy society all rights reserved oxford university press

social security and private transfers in developing countries the case of peru do social security systems crowd out private transfers from younger to older generations this question has generated much theoretical discussion but little empirical work exists to confirm or refute this crowding out hypothesis we investigate the connection between social security and private transfers in peru using the peruvian living standards survey and find that private transfers from young to old would have been nearly 20 percent higher without social security benefits this indicates that the peruvian social security system is less effective at delivering benefits to the elderly than a simple assignment of government expenditures would suggest social security s displacement of private transfers while significant is less than that predicted by models with widespread altruistic transfers

what can we learn from past price stabilization policies and market reform in mexico abstract this paper reviews experience with policy reforms in the maize sector in mexico beginning in the 1980s with particular reference to impacts on price variability it analyses mexico s transition from past price stabilization policies under a state trading enterprise to market reforms implemented during the 1990s the nature extent and costs to producers and consumers of maize policies is discussed for both the pre reform and the reform periods although wide ranging reforms have been introduced impacts on efficiency and fiscal outlays have been less than expected

the great crash of 2008 and the reform of economics the 2008 economic crash led to remarkable shifts of opinion among world leaders does this crisis create favourable conditions for the reform and revitalisation of economics itself from a subject dominated by mathematical techniques to a discipline more oriented to understanding real world institutions and actors and why were warnings of financial collapse not heeded recent shortcomings are partly related to the global triumph of market individualist ideology and partly to the exaggerated roles of modelling and quantification these failures of economics are partly peculiar to the discipline and also a result of other wider institutional and cultural forces

motives for private transfers over the life cycle an analytical framework and evidence for peru abstract this paper tests for the motives for private income transfers we consider two motives altruism and exchange the question of private transfer motives is important because such motivation can influence the effects of public income transfers on the distribution of income using a household survey for peru we find that transfer amounts received increase with recipient pre transfer income which contradicts a key prediction of the strong form of the altruism hypothesis but is consistent with exchange we also find that capital market imperfections are likely to be an important cause of private transfers and that social security benefits crowd out the incidence of private transfers

maize and the free trade agreement between mexico and the united states setting the price of maize in rural mexico above the world price is inefficient and likely to have negative distributional effects because many subsistence producers and all landless workers are net buyers in fact it screens out the relatively poor rather than the relatively rich the policy objective therefore should be to move toward free trade this would yield large gains in efficiency the free trade agreement provides an ideal opportunity to pursue this objective it will provide freer entrance into the united states for other agricultural products as well as a broad range of manufactured products ensuring secure and sustained access for labor intensive agricultural and manufactured products can help ease the impact on the labor market of a transition away from subsistence maize cultivation

electric vehicles the future we made and the problem of unmaking it the uptake of battery electric vehicles bevs subject to bottlenecks seems to have reached a tipping point in the uk and this mirrors a general trend globally bevs are being positioned as one significant strand in the web of policy intended to translate the good intentions of article 2 of the conference of the parties 21 paris agreement into reality governments and municipalities are anticipating that a widespread shift to bevs will significantly reduce transport related carbon emissions and therefore augment their nationally determined contributions to emissions reduction within the paris agreement however matters are more complicated than they may appear there is a difference between thinking we can just keep relying on human ingenuity to solve problems after they emerge and engaging in fundamental social redesign to prevent the trajectories of harm bevs illustrate this the contribution to emissions reduction per vehicle unit may be less than the public initially perceive since the important issue here is the lifecycle of the bev and this is in no sense zero emission furthermore even though one can make the case that bevs are a superior alternative to the fossil fuel powered internal combustion engine the transition to bevs may actually facilitate exceeding the carbon budget on which the paris agreement ultimately rests whether in fact it does depends on the nature of the policy that shapes the transition if the transition is a form of substitution that conforms to rather than shifts against current global scales and trends in private transportation then it is highly likely that bevs will be a successful failure for this not to be the case then the transition to bevs must be coordinated with a transformation of the current scales and trends in private transportation that is a significant reduction in dependence on and individual ownership of powered vehicles a radical reimagining of the nature of private conveyance and of public transportation

the contemporary relevance of a cambridge tradition economics as political economy political economy as social theory and ethical theory in this review essay i set out key aspects of nuno martins the cambridge revival of political economy in so doing i also provide some comments on the current state of economics since these provide some context for an appreciation of what martins is trying to achieve martins is focused on making the positive case for classical political economy cpe as a form of theory that is quite different from the modern mainstream for martins that difference is based on its approach to the distribution of a surplus expressed through a social ontology that is based on historical open systems and in which the key aspect of open systems is the institutional and hence deliberative activity by which the surplus is decided which is ultimately an issue for ethics it is through a cambridge tradition focusing on sraffa keynes lawson and sen that cpe a classical social theory and ethical deliberation are brought together bringing them together is an act of synthesis and i conclude by providing a constructive critique of the terms of this synthesis

the pay as you go pension system as fertility insurance and an enforcement device a paygo system may serve as insurance against not having children and as an enforcement device for ungrateful children who are unwilling to pay their parents a pension in fact the latter was bismarck s historic motive for introducing this system it is true that the paygo system reduces the investment in human capital but if it is run on a sufficiently small scale it may nevertheless bring about a welfare improvement if on the other hand the scale of the system is so large that parents bequeath some of their pensions to their children it is overdrawn and creates unnecessarily strong disincentives for human capital investment

the shallow or the deep ecological economics movement ecological economics and its policy recommendations have become overwhelmed by economic valuation shadow pricing sustainability measures and squeezing nature into the commodity boxes of goods services and capital in order to make it part of mainstream economic financial and banking discourses there are deeper concerns which touch upon the understanding of humanity in its various social psychological political and ethical facets the relationship with nature proposed by the ecological economics movement has the potential to be far reaching however this is not the picture portrayed by surveying the amassed body of articles from this journal or by many of those claiming affiliation a shallow movement allied to a business as usual politics and economy has become dominant and imposes its preoccupation with mainstream economic concepts and values if instead ecological economists choose a path deep into the world of interdisciplinary endeavour they will need to be prepared to transform themselves and society the implications go far beyond the pragmatic use of magic numbers to convince politicians and the public that ecology still has something relevant to say in the 21st century author s abstract

pension design when fertility fluctuates the role of education and capital mobility this study compares alternative designs of an unfunded pension system convex combinations between a fixed contribution rate and a fixed benefit rate are considered the objective is to maximize the expected ex ante welfare under stochastic fertility the model is a three period cge framework where the financing of education and effects on factor prices are accounted for factor prices depend on the degree of capital mobility for low degrees of capital mobility it is optimal to have a fixed benefit rate in the pension system but for the small open economy a fixed contribution rate is optimal if the education system has a fixed benefit rate in this case individuals in the small open economy are unaffected by fertility fluctuations

diversification and labor market effects of the mexican coffee crisis this paper analyses how coffee producing households responded to the low coffee prices prevailing around 2003 we provide theory on differential responses in regions dedicated to coffee growing compared to more diversified or better accessible regions we show how labor market effects can explain why in the former regions value adding activities processing certification are undertaken while in the latter regions off farm activities are adopted farm size favors value adding activities as well as on farm diversification these findings call for policy responses to low prices that distinguish between specialized regions and diversified or well connected regions

market access by smallholder farmers in malawi implications for technology adoption agricultural productivity and crop income abstract in malawi maize is the major crop and food staple given limited off farm employment opportunities much needed increases in household income for improving food security must come from gains in agricultural productivity through better technology and more profitable crops in the past hybrid maize and more recently tobacco were promoted by policy for increasing smallholder income an analysis of determinants of adoption of these two crops and related income effects is presented apart from factor endowment and exposure to agroecological risks differences in the household s access to financial and commodity markets significantly influence its cropping shares and farm income