revisiting minimum quality standards abstract this paper revisits the issue of minimum quality standards in a model of quality uncertainty different from leland s minimum quality standards are shown to conflict with the revelation principle s truthtelling requirements thus minimum quality standards in that model cannot be a component of the constrained paretian solution outcome

revisiting the role of education for agricultural productivity while the majority of micro studies finds that rural education increases agricultural productivity various recent cross country regressions analysing the determinants of agricultural productivity were only able to detect insignificant or even surprising negative effects of schooling in this paper we argue and show that this failure to find a positive impact of education in the international context is rather a data problem related to the use of enrolment and literacy indicators using a panel of 95 developing and middle income countries from 1961 to 2002 together with the newest version of the barro lee educational attainment dataset we show that education indeed has a highly significant positive effect on agricultural productivity which is robust to changes in the control variables and in the econometric methods applied distinguishing between different levels of education further reveals that only primary and secondary schooling have significant positive impacts while tertiary education remains insignificant finally the effect of education is estimated separately for countries with different income levels results indicate that the coefficient of the education variable remains insignificant for countries from the poorest three income quintiles while it is positive and highly significant for the richest two quintiles this finding can be interpreted as support for the prominent argument claiming that education leads to higher agricultural productivity only in the presence of rapid technical change where education will help farmers to adjust more readily to the new opportunities

formal schooling and workforce participation in a rapidly developing economy evidence from compulsory junior high school in taiwan abstract using 18 consecutive household surveys this study explores the impact of taiwan s extension of tuition free education from 6 to 9 years upon schooling and labor market outcomes participation sector class of activity and work income i estimate upward shifts relative to preexisting trends of more than 0 4 years of education for males and 0 25 years for females in the first six cohorts affected by compulsory junior high schooling utilizing inter cohort variation within an instrumental variables iv strategy i find larger effects of schooling on females workforce participation and total earnings even controlling for selection

the nonparametric risk adjusted efficiency measurement an application to taiwan s major rural financial intermediaries in this article a nonparametric approach is used to incorporate risk into the measurement of technical efficiencies of the major financial intermediaries in rural taiwan risk is treated as a joint but undesirable output given the fact that various regulatory actions may prevent its free disposability three risk indicators nonperforming loans allowance for loan losses and risky assets are employed alternatively in the empirical work results suggest that all three risk constraints are binding regulations on controlling risky assets and loan loss reserves are effective but more burdensome than those on controlling loan quality

can megamergers improve bank efficiency abstract this paper uses a fitted multiproduct translog cost function to simulate mergers between pairs of us commercial banks with assets exceeding 1 billion and studies the predicted impact of such mergers on total costs thick frontier analysis reveals that variations in x efficiency dominate scale product mix and branching efficiencies ex ante financial data imply that costs could potentially be reduced in nearly half of the possible mergers except those between banks each larger than 10 billion most cost efficient mergers are across state lines apparently a result of variations in product mix

product differentiation and asymmetric information in agricultural and food market defining the role for government discussion this timely session addresses the very important issue of the role of governments in establishing standards and labeling requirements in the changing environment of the agricultural sector with product differentiation becoming a central feature of the domestic and global food system quality and quality assurances are important to both producers and consumers however if quality characteristics cannot be observed by consumers there is potential for market failure to avoid or minimize such failures standards and regulations are administered by the government however the effects of government policies addressing the potential for market failures are often difficult to assess the four papers in this session all address some aspects of food quality regulations and the role of government from the role of the usda agricultural marketing service ams in setting standards and inspections to the role of the federal trade commission ftc in regulating information passed on to consumers through advertising these papers suggest that the government does a pretty good job of regulating quality standards however there are several issues that have been largely ignored and can have significant impacts on the cost benefit evaluations of standards and regulations one important area that was mentioned only briefly in the paper by gardner is the potential for standards and regulations of creating market power market power can have significant effects on product innovation price variability and other factors

education development and wage inequality the case of taiwan abstract this article uses a multiple stage theil decomposition to examine the contribution of five development processes to wage inequality in taiwan increases in educational attainment the expansion of skill intensive industries factor specific technical change population aging and the entry of women into the labor force since the supply of skill tends to remain constant within cohorts the theil decomposition is useful in separating the effects of supply and demand related factors on the wage structure increases in educational attainment tended to reduce inequality in the 1980s but factor specific technical change increased inequality in the 1990s

a dea study to evaluate the relative efficiency and investigate the reorganization of the credit department of farmers associations in taiwan in this study data envelopment analysis models were applied to evaluate the relative efficiencies of the credit departments of farmers associations cdfas in taiwan the findings show that the overall efficiency scores are not best and scale for cdfas in taiwan is relative small it implies that the reorganization of the cdfas may be appropriate if more efficient organization is to be pursued thus this study investigated cdfas reorganization to increase the efficiency the proposed cdfas reorganization alternatives have higher average efficiency scores than the current cdfas

nutrition and labor producvivity in agriculture estimates for rural south india using panel data for rural south india a fixed effects individual wage equation and farm production function are estimated that have calorie intake and nutritional status weight for height of workers as their arguments neither market wages nor farm output are observed to be responsive to changes in the daily energy intake of workers however both are highly elastic with respect to weight for height these results suggest that while the human body can adapt to inadequate nutrition in the short run it cannot adapt as readily to chronic malnutrition that eventually results in loss of weight for height copyright 1988 by mit press

the impact of education in rural ghana examining household labor allocation and returns on and off the farm most of the human capital literature pertaining to developing countries focuses on the returns to education in either farm work or wage work few studies examine how education affects the allocation of time between these activities this paper estimates the returns to education in farm and off farm work and consequently the role of education in determining the allocation of labor the results from this study show that off farm work has a much higher return to education than does farm work and suggest that this divergence in returns affects the allocation of labor in farm households between farm and off farm work

the relationship between education and adult mortality in the united states prior research has uncovered a large and positive correlation between education and health this paper examines whether education has a causal impact on health i follow synthetic cohorts using successive u s censuses to estimate the impact of educational attainment on mortality rates i use compulsory education laws from 1915 to 1939 as instruments for education the results suggest that education has a causal impact on mortality and that this effect is perhaps larger than has been previously estimated in the literature copyright 2005 wiley blackwell

rent seeking in international trade the great tomato war this paper presents a model of international rent seeking activities by producers in both exporting and importing nations the model is applied to the winter vegetable trade between the united states and mexico an analysis is made of the attempts to form export import coalitions reasons for these failures are given due to past failures to impede trade essentially free trade in winter vegetables between the two countries exists

impacts of minimum quality standards imposed through marketing orders or related producer organizations we analyze the impacts of minimum quality standards mqs imposed by producers acting collectively through a producer organization such as a marketing order mqs imposed in a competitive market can never enhance social welfare because in general an mqs creates two deadweight losses one due to inefficient enhancement of product quality and a second due to wastage of the low quality product any mqs that a competitive industry implements based upon a profit criterion causes all consumers in the market to be harmed however an mqs may be preferred relative to supply control as a second best instrument for transferring income to producers

applying data envelopment analysis in analysing the organizational change for credit departments of farmers associations in taiwan this study attempts to apply the data envelopment analysis to approach the performance of the credit departments of farmers associations in taiwan based on the structure of the data envelopment analysis approach this study measures the relative efficiency for credit departments of farmers associations in taiwan via resource redistribution when the amount of resource is fixed it can be distributed to each unit within an organization in a better way it is intended to find the possible improvements for those inefficient credit departments of farmers associations the empirical results show that the overall efficiency scores of the teams indicate is not best and scale for credit departments of farmers associations in taiwan is relatively small it implies that the reorganization of the credit departments of farmers associations may be appropriate if more efficient organization is to be pursued finally the reorganization of the credit departments of farmers associations are studies evidences show

investments in the schooling and health of women and men quantities and returns this paper surveys the evidence on recent trends in the growth of human capital investments in women that raised womens productivity in thus century in most countries patterns in school investments in men and women across regions and across birth cohorts within countries indicate that expected years of school enrollment is converging between low and high income countries to where the gaps have closed from about seven years in 1950 to five years in 1985 women today are receiving nearly as many years of education as men in industrially advanced high income countries latin america south east and east asia are relatively similar to the high income countries at the other extreme in most of the countries of south and west asia and north and sub saharan africa women receive about two fifths to three fourths the number of years of schooling as men do in every region however the ratio of female to male expected years of enrollment increased from 1950 to 1985 gender differences in mortality and nutritional status reveal that there has been a dramatic but largely unexplained advance in female longevity relative to male in the 20th century in most countries with the exception of certain countries in south asia this development is associated with the shift of populations from dependence on agriculture to working in urban areas these changes are a major source of decreasing inequality within and between countries in this century market failure could be responsible for families investing less than the socially efficient amount in girls than boys there are problems in measuring without bias these private and social return empirical patterns across countries in estimated returns to schooling illustrate that private returns at the primary secondary and higher education levels can vary for women and men

farmers health and agricultural productivity agriculture is one of the most hazardous productive sectors around the world most previous studies have focused on health issues of farmers in developing countries while little attention has been paid to farmers health problems in developed countries the present study assesses the effect of farmers health conditions on agricultural productivity in norway employing stochastic frontier regression techniques we conclude that differences in farmers health help to explain the variance in agricultural production efficiency

education and economic growth in taiwan a case of successful planning abstract taiwan s education system had three features which were instrumental to its spectacular economic success first it had an infrastructure already built up by 1950 for basic education that extended fairly broadly among the population second a ready supply of highly educated labor arrived in 1949 50 from the mainland to replace the japanese and to begin the process of building the local economy most important the education system was planned to grow in a manner that closely matched the changing requirements of the growing economy the compulsary basic education was raised from six to nine years the secondary level curriculum was shifted more toward vocational fields the supply of university graduates was strictly limited and the university curriculum changed to emphasize science and engineering subjects the levels above basic junior high level were expanded but disproportionately into the private sector so they were not as costly to the government

the causal effect of education on farm related disability evidence from a compulsory schooling reform in taiwan we investigate the causal effect of education on the incidence and severity of farm related disability our dataset is comprised of 75 708 farmers drawn from the taiwanese agriculture census supplemented with administrative data on farmer disability approximately 46 of the farmers in our sample were affected by legislation expanding compulsory schooling from the primary school level to the junior high school level utilizing the compulsory schooling reform as a natural experiment for identification we estimated an instrumental variable two part model of the incidence and severity of disability where the latter is measured using the number of disabled days for farmers aged from 35 to 45 we find that greater educational attainment significantly reduced the likelihood of farm related disability as well as the severity of disability two potential mechanisms for this effect were fewer on farm work days and less use of chemical inputs to farm production among more educated farmers

changes in the returns to education in costa rica abstract i document patterns in the returns to education in costa rica from 1976 to 1992 the most important change during this period was that from the late 1970s to the mid 1980s the return to education fell by about one fourth i construct demand and supply indices within a fixed manpower requirements framework to estimate demand and supply shifts i find a significantly positive relationship between measures of demand for education and a significantly negative relationship between measures of supply for education these findings suggest that calculations based on the returns to education such as the returns to social investments in education must take into account future changes in the returns to education as supply and demand conditions develop

the general validity of the heckscher ohlin theorem despite a number of attempts to extend it the heckscher ohlin theorem remains woefully restricted in terms of the generality of the assumptions needed for its proof in its traditional form as a statement about the commodity composition of trade the theorem is valid only in the highly abstract environment of the two factor two good twocountry model that has been the mainstay of trade theory for half a century a weaker version of the theorem involving the factor content of trade rather than its commodity composition has been proved for any number of factors goods and countries but this generality has so far been bought only at the cost of other and perhaps equally restrictive assumptions 2 the purpose of this paper is to provide statements and proofs of the heckscher ohlin h o theorem that are more general than those currently available the approach taken is similar to that used in my 1980 article for an extension of the theory of comparative advantage in terms of correlations between autarky prices and trade in section i i lay out the assumptions on which the analysis is based these assumptions provide the outlines of a reasonably general model in which there may be any numbers of goods and factors and in which factor prices may be equalized or not trade impediments in the form of tariffs or export taxes are permitted though transportation costs are not 3 in section ii i discuss the difficulty of inferring the factor content of trade in a world of unequal factor prices and i provide several alternative definitions of that concept for use later in the paper these together with the assumptions of section i are used in section iii to prove a theorem on the value at autarky prices of the factor content of trade in section iv this theorem is used to prove a first corollary that makes a more direct statement about the pattern of trade it says that worldwide there must be a negative correlation between the factor content of trade by factor and country and the corresponding autarky factor prices it is precisely these autarky factor prices that constitute the ohlin measure of factor scarcity therefore the corollary provides a formal statement of the general idea that countries tend to export the services of those factors which they have in relative abundance and it may be regarded as a generalization of the factor content version of the h o theorem finally a generalization of the commodity version of the theorem is proved in section v the concept of a covariance is generalized university of michigan i have benefitted greatly from the comments of paul degrauwe wolfgang mayer michael mussa carl simon and robert stern as well as others who participated in seminars at the universities of michigan chicago and cincinnati and at the national bureau of economic research an anonymous referee also made valuable comments with additional goods and factor price equalization the theorem runs afoul of the indeterminacy of production and trade noted by paul samuelson 1953 and james melvin 1968 without factor price equalization trade impediments and intermediate production can cause reversals of the pattern of trade as shown in my 1979 article if additional factors and countries are also added it becomes difficult even to state the theorem let alone to prove it 2melvin stated such a theorem for the three good two factor case and jaroslav vanek 1968 proved it for the general case but only by assuming factor price equalization trent bertrand 1972 and jon harkness 1979 were able to drop the factor price equalization assumption but replaced it with restrictions on consumption of either goods or factors by country of origin it is unclear to me however that these restrictions can ever be met in a model that is otherwise plausible harkness 1978 has also used the factor content version of the theorems as the motivation for a regression equation relating commodity trade to factor intensities this bears some resemblance to my analysis below in section v see however james anderson 1981 and edward leamer and harry bowen 1981 who have criticized his result with a reply by harkness 1981 3for ease of exposition i do not allow here for transportation costs these were included in an earlier version of this paper following the technique in my 1980 article

explaining efficiency differences among large german and austrian banks cost efficiency scale efficiency and productivity change are estimated by data envelopment analysis and cost efficiency is regressed on explanatory variables no evidence is found for average productivity responding to deregulation over the period studied state owned banks are found to be more cost efficient likely owing to cheaper funds and cooperative banks to be about as cost efficient as private banks increasing economies of scale but decreasing economies of scope provide rationale for m as among banks with similar product portfolios interbank and capital market funding is found to be more cost efficient than deposits when the cost of retail networks is controlled

changing returns to education in taiwan 1978 1991 abstract we find that private rates of return in taiwan are highest for higher education levels for example university and lowest for lower education levels for example junior high school and that private returns are higher for women than men at all education levels unlike most other studies of changing returns to education over time in developing countries we find that private returns for all education levels are remarkably stable during 1978 1991 in taiwan

factor content functions and the theory of international trade this paper introduces the concepts of direct and indirect factor trade utility functions and uses them to derive marshallian and hicksian factor content functions which express the quantities of factors of production embodied in net imports as functions of the exogenous variables facing the economy the properties of these functions are discussed and they are used to derive a number of new results in particular it is shown that in certain circumstances the existence of gains from trade is sufficient for the heckscher ohlin theorem to hold in its factor content form

estimating average and local average treatment effects of education when compulsory schooling laws really matter the change to the minimum school leaving age in the united kingdom from 14 to 15 had a powerful and immediate effect that redirected almost half the population of 14 year olds in the mid twentieth century to stay in school for one more year the magnitude of this impact provides a rare opportunity to a estimate local average treatment effects late of high school that come close to population average treatment effects ate and b estimate returns to education using a regression discontinuity design instead of previous estimates that rely on difference in differences methodology or relatively weak instruments comparing late estimates for the united states and canada where very few students were affected by compulsory school laws to the united kingdom estimates provides a test as to whether instrumental variables iv returns to schooling often exceed ordinary least squares ols because gains are high only for small and peculiar groups among the more general population i find instead that the benefits from compulsory schooling are very large whether these laws have an impact on a majority or minority of those exposed

marketing orders as nontariff trade barriers previous analysis shows that under autarky all groups must lose from minimum quality standards with symmetric information we find that with international trade it is possible for one country to gain by introducing minimum quality standards however it is not possible for both countries to gain from the standards this result implies that minimum quality standards are nontariff trade barriers using the walter and baldwin criteria

the welfare implications of minimum quality standards previous analysis of the social welfare implications of minimum quality standards has yielded no decisive results in this paper the specific nature of consumer and producer responses to quality standards is incorporated into the analysis both consumer and producer gains are shown to be impossible when consumers can perceive quality before purchase even if low quality produce is diverted to secondary markets standards unambiguously reduce net social benefits the paper explores the possibility that minimum quality standards are a form of rent seeking behavior