socially responsible products what motivates consumers to pay a premium abstractthe motivation to pay a premium for socially responsible products is partly an expression of consumer concern for the well being of those involved in the production process buying a product with a socially responsible label and donating to a charity are similarly motivated actions while there is an extensive literature on the economics of charitable giving that examines motivations to donate as well as on the impacts of labelling on consumer demand there is little overlap between the two literatures we bridge these two literatures by investigating whether consumers have heterogeneous motivations for paying a premium through a laboratory experiment that auctions coffee with hypothetical socially responsible labels that put different weights on in kind versus cash transfers we find that those consumers who prefer an in kind transfer paternalistic altruists are willing to pay a 52 5 price premium over standard coffee those who prefer that most of the premium is paid as cash strong altruis

the impact of fair trade certification for coffee farmers in peru smallholder farmers producing for fair trade market outlets are usually considered to benefit from better prices and stable market outlets however many empirical studies verifying this impact suffer from strong selection bias this study uses a balanced sample of fair trade farmers and likewise nonfair trade producers of organic and conventional coffee from peru to compare the net effects on production income and expenditures wealth and investments and attitudes and perceptions after careful matching we find only modest direct income and production effects but significant changes in organization input use wealth and assets and risk attitudes moreover important differences between farmers with early and more recent ft affiliation are registered

endogenous entry and self selection in private value auctions an experimental study this paper presents the results of an experimental study of endogenous entry in first price independent private value auctions n potential bidders simultaneously decide whether to participate in an auction or receive a known outside option in the second stage entrants submit bids after learning their own private values and the number of entrants an equilibrium model of heterogeneous risk averse bidders implies a self selection effect where bidding in the auction is lower with endogenous entry because only less risk averse bidders enter this effect is confirmed by the experiment we also observe excessive entry relative to the theoretical model

voluntary governance mechanisms in global supply chains beyond csr to a stakeholder utility perspective poor working conditions remain a serious problem in supplier facilities in developing countries while previous research has explored this from the developed buyers side we examine this phenomenon from the perspective of developing countries suppliers and subcontractors utilizing qualitative data from a major knitwear exporting cluster in india and a stakeholder management lens we develop a framework that shows how the assumptions of conventional buyer driven voluntary governance break down in the dilution of buyer power and in the web of factors rooted in suppliers traditions beliefs local demands and resource dependency we reveal out how success in governing collaborative global supply chains often falls short within the subcontracting stage where a stakeholder management mindset is elusive to most participants we suggest that success in governing collaborative global supply chains is dependent on concepts of stakeholder utility and the presence of shared value that is often at odds with the realities of power information asymmetry and compliance reward systems inherent in the non market coordination of global supply chains our findings offer important insights for delineating the concepts of value creation from csr concepts and practices and for modifying the basic assumptions of conventional supply chain governance

learning by bidding we analyze a dynamic second price auction with an informed bidder and an uninformed bidder who upon seeing a posted price learns whether his valuation is above that price in the essentially unique equilibrium an informed bidder bids in the first period if her valuation is below some cutoff and bids only in the last period otherwise an uninformed bidder bids in every period to optimally change the price unless the price is above his valuation or he is the high bidder this model also provides a rationale behind the use of a secret reserve price in private value settings

bidding behavior in descending and ascending auctions this research examines how individual differences and institutional practices influence consumer bidding in auctions bidders may be motivated by different goals e g thrill of winning the item with minimal attention to what they pay for it versus prudence winning the item at a price at or below its perceived value also innate or auctioneer induced differences may exist in the precision and salience of bidder cognitions about the item s value we report two studies on how these motivational and cognitive factors influence bids in descending and ascending auctions respectively each study also manipulated a situational variable wait time at each price step the two auctions realized different average prices for the same item set average bids were higher in the descending versus ascending auction in several study conditions in both auction formats bidders primed with thrill versus prudence bid higher but more precise and or salient values attenuated this goal effect among other results in the descending auction longer wait times elicited higher bids from bidders primed with thrill but not prudence in the ascending auction longer wait times produced lower bids for bidders primed with prudence but not thrill these findings on consumer bidding behavior have practical implications for auction design

the effect of fair trade affiliation on child schooling evidence from a sample of chilean honey producers we evaluate the impact of fair trade ft affiliation on child schooling within a sample of chilean honey producers with a retrospective panel data approach from a theoretical point of view we argue that ft should have a positive effect on child schooling since it generates a short run pure income effect together with a medium run productivity effect on both adult and child wages on the other hand because of the higher productivity generated by the medium run effect the opportunity cost of child education increases if they work with their parents the direction of the impact of ft affiliation on child schooling is therefore uncertain and requires empirical testing our econometric findings document a positive and significant impact of affiliation years on child schooling after controlling for endogeneity and heterogeneity between the treatment and control sample

industry self regulation without sanctions the chemical industry s responsible care program industry self regulation the voluntary association of firms to control their collective action has been proposed as a complement to government regulation proponents argue that the establishment of

e pluribus unum legitimacy issues and multi stakeholder codes of conduct regulatory schema has shifted from government to governance based systems one particular form that has emerged at the international level is the multi stakeholder voluntary code of conduct msvc we argue that such codes are not only simply mechanisms by which various stakeholders attempt to govern the action of the corporation but also systems by which each stakeholder attempts to gain or retain some legitimacy goal each stakeholder is motivated by strategic legitimacy goal to join the code and once a member is also required to assist in maintaining the institutional legitimacy of the code resulting in networked legitimacy we begin our analysis of these systems by first exploring the growth and structure of such msvcs and then building an analytical framework using strategic and institutional legitimacy as they apply to such msvcs we contribute to the codes of conduct literature by developing the construct of networked legitimacy from strategic and institutional legitimacy we then apply our framework to the united nations global compact one of the predominant msvcs today in doing so we 1 demonstrate how different stakeholders are pursuing different types of legitimacy through their participation in the code 2 examine the specific opportunities and risks in terms of what we have called networked legitimacy posed by the institutional design of actual msvcs and 3 create an argument for three pillars supporting the legitimacy of msvcs

faith based charity and crowd out during the great depression abstract interest in religious organizations as providers of social services has increased dramatically in recent years churches in the u s were a crucial provider of social services through the early part of the twentieth century but their role shrank dramatically with the expansion in government spending under the new deal in this paper we investigate the extent to which the new deal crowded out church charitable spending in the 1930s we do so using a new nationwide data set of charitable spending for six large christian denominations matched to data on local new deal spending we instrument for new deal spending using measures of the political strength of a state s congressional delegation and confirm our findings using a different instrument based on institutional constraints on state relief spending with both instruments we find that higher government spending leads to lower church charitable activity crowd out was small as a share of total new deal spending 3 but large as a share of church spending our estimates suggest that benevolent church spending fell by 30 in response to the new deal and that government relief spending can explain virtually all of the decline in charitable church activity observed between 1933 and 1939

robustness of bidder preferences among auction institutions i introduction the answer to the question of how bidders choose to enter one auction versus an alternative competing auction is important to understand in providing a complete picture of the nature of endogenous entry decisions into auctions the issue of how a bidder chooses which among alternative auctions to enter as well as whether to enter an auction at all is of substantial importance to auctioneers attempting to attract bidders to their auctions there is a growing literature addressing issues in endogenous entry in auctions there are several papers such as engelbrecht wiggans 1993 pevnitskaya 2004 and palfrey and pevnitskaya 2008 that consider the decision of whether to enter an auction or not and study the effect of endogenous entry on bidding behavior there is a much larger group for example harstad 1990 engelbrecht wiggans 1993 levin and smith 1994 mcafee 1993 and mcafee and mcmillan 1987 that considers competition between auctioneers in which the auctioneers are competing along some characteristic such as entry price we consider the case in which auctioneers may be competing with each other based on the choice of auction mechanism our interest is in the degree to which the auction mechanism itself might impact the entry decisions of potential bidders of course there would be a direct pecuniary impact of the mechanism in that bidders should be more likely to enter auction mechanisms that they believe allow them to get lower prices but there may be other cognitive issues in regard to the structure of the mechanism that may also impact the choice behavior in ivanova stenzel and salmon iss 2004a we introduced an experimental design aimed at eliciting and measuring preferences subjects might possess for different auction institutions and applied the design to testing bidder preferences between ascending a dynamic mechanism and sealed bid first price a static mechanism auctions it seems reasonable to expect bidders to have preferences between these two auction mechanisms due to the strategic differences between them in a first price auction the winner pays a price equal to his own bid whereas in the ascending auction he pays a price that is an increment above the second highest bid these differences might result in difficulty of deciding how to bid and in the possibility of experiencing some form of regret 1 the design involved having subjects make a choice between entering into a two bidder sealed bid first price auction versus a two bidder ascending auction each with different entry prices by varying the entry prices we could measure the subjects willingness to pay for either auction our main finding in the paper was that while subjects exhibited strong preferences for the ascending auction at equal entry prices they were not willing to pay up to the expected profit difference between the two auctions to participate in an ascending auction thus they ended up entering the supposedly less preferred sealed bid first price auction even in situations in which they would expect to make a higher net surplus including the cost of the entry fee by entering into the ascending auction instead that paper proposed one possible answer to the puzzle that involved assuming that bidders were risk averse in their bidding behavior and then risk averse to the same degree in their auction choice behavior this explanation worked because neither risk averse nor approximately risk neutral bidders should be expected to pay much to enter into an ascending auction instead of a sealed bid first price auction just as we observed in the experiment for the most risk averse bidders this is because while they bid the highest in the first price auction and therefore expected little surplus in the event that they win they consequently end up winning with higher probability than less risk averse bidders this is a trade off risk a verse bidders are willing to accept and consequently it is easy to show that highly risk averse bidders should not be willing to pay much to get into the more lucrative though risky ascending auction

challenges to legitimacy at the forest stewardship council the forest stewardship council fsc is a global private governance system overseeing the sustainability and biodiversity of the world forestry system through certification of forests and forestry processes and products and is perceived as the strongest of the various certification schemes available domask globalization and ngos transforming business government and society 2003 gulbrandsen global environmental politics 2004 it has seen more success in developed than developing countries in terms of amount of forest certified and number of chain of custody certificates issued raising questions as to its ability to promote biodiversity gulbrandsen global environmental politics 2004 a number of challenges have risen to the pragmatic and moral legitimacy of the fsc as a global governance system alternative certification schemes output and market access cost of certification plantations and illegal logging i examine each of these challenges as they pertain to the dimensions of pragmatic and moral legitimacy of the fsc i conclude with a discussion of theoretical implications for global governance systems using ecolabel schemes as well as a discussion of practical implications for the fsc in particular

english auctions with resale an experimental study i design and test a simple english auction and two english auctions with resale but with different informational backgrounds all three treatments theoretically have the same equilibrium i find however that the possibility of resale alters behavior significantly in the two treatments with resale subjects deviated from both the nash prediction and the common results about bidding behavior in english auctions subjects tend to overbid when they are certain they can reap the whole surplus in the resale market i employ different models like qre and levels of reasoning and conclude that overbidding can be explained as a rational response to the noisy environment in markets with human participants that is as rational decision making when anticipating others to make errors when the outcome of the resale market is not certain there is significant signaling behavior and auction prices tend to be lower than the nash prediction

consumers valuation of sustainability labels on meat there are various sustainability certifications and claims for food products that focus on environmental or ethical benefits these claims empower consumers to make informed purchasing decisions that take environmental and ethical considerations into account this paper compares consumers preferences for four types of sustainability claims related to organic meat free range animal welfare and carbon footprint using a choice experiment on a chicken breast product our results show that nine in every ten belgian consumers favor free range claims which are also valued the most highly attracting premiums ranging from 43 to 93 our study also shows that a vast majority of consumers 87 would welcome the introduction of an eu level animal welfare label the carbon footprint labels and the organic labels are less appealing to consumers who have lower willingness to pay for these labels belgian consumers prefer the national belgian organic food logo certified by a private organization to the newly introduced eu organic food logo

eliciting and utilizing willingness to pay evidence from field trials in northern ghana we utilize the becker degroot marschak 1964 mechanism to estimate the willingness to pay for clean drinking water technology in northern ghana the bdm mechanism has attractive properties for empirical research allowing us to directly estimate demand compute heterogeneous treatment effects and study the screening and causal effects of prices with minor modifications to a standard field experiment setting we demonstrate the implementation of bdm along these three dimensions compare it to the standard take it or leave it method for eliciting willingness to pay and discuss practical issues for implementing the mechanism in true field settings jel classifications c93 d12 d82 l11 l31

long term outlook of energy use and co2 emissions from transport in central and eastern europe a forecast of transport activity energy consumption and carbon dioxide emissions from transportation carried out under business as usual economic assumptions is presented for the 10 countries of central and eastern europe that have acquired the status of accession countries to the european union energy demand is projected under considerations of the dynamic evolution of transport modes and their use the evolution of automotive fuel prices which are assumed to gradually converge with western european price levels within the current decade and assumptions on efficiency improvements in all transport modes according to current technological trends and european regulations the results showing transportation energy demand to double and co2 emissions to be 70 higher in 2030 compared to 2000 are compared with other published forecasts and discussed with a view to potential future energy and environmental impacts in these countries outlining major policy implications r 2002 elsevier science ltd all rights reserved

monetary rewards and decision cost in experimental economics a survey of thirty one experimental studies which report data on the comparative effects of monetary rewards and opportunity cost shows 1 several studies in which increased rewards shift the central tendency of the data toward the predictions of rational models 2 in virtually all cases rewards reduce the variance of the data around the predicted outcome this is consistent with a model in which rewards are balanced against decision cost in agent behavior and explicates the argument that when rational models fail it can be attributed to low opportunity cost of deviations from the rational prediction

factors shaping aggregate energy intensity trend for industry energy intensity versus product mix understanding the mechanisms of change of energy consumption in industry has attracted much attention since the 1973 world oil crisis a popular line of research has been to decompose changes in the aggregate energy intensity of industry to give the relative impacts arising from energy intensity change and product mix change using a decomposition technique many empirical studies covering a large number of countries have been reported the main objective of this paper is to put together the empirical results reported in these studies in a coherent framework and identify possible systematic features of particular interest are the basic trends in this line of research the relative importance of energy intensity change and product mix change possible variations over time and between country groups in the energy impacts of these changes and inconsistencies in findings among studies an overview of the decomposition technique including its strengths weaknesses and role in industrial energy consumption studies is also presented

corporations and ngos when accountability leads to co optation interactions between corporations and nonprofits are on the rise frequently driven by a corporate interest in establishing credentials for corporate social responsibility csr in this article we show how increasing demands for accountability directed at both businesses and ngos can have the unintended effect of compromising the autonomy of nonprofits and fostering their co optation greater scrutiny of ngo spending driven by self appointed watchdogs of the nonprofit sector and a prevalence of strategic notions of csr advanced by corporate actors weaken the ability of civil society actors to change the business practices of their partners in the commercial sector to counter this trend we argue that corporations should embrace a political notion of csr and should actively encourage ngos to strengthen downward accountability mechanisms even if this creates more tensions in corporate ngo partnerships rather than seeing ngos as tools in a competition for a comparative advantage in the market place corporations should actively support ngo independence and critical capacity

pareto optimal electricity tariff rates in the republic of armenia abstract the economic impact of electricity tariff rates on the residential sector of yerevan armenia is examined the effect of tariff design on revenue generation and equity measures is considered and the combination of energy pricing and compensatory social policies which provides the best mix of efficiency and protection for poor households is examined an equity measure is defined in terms of a cumulative distribution function which describes the percent of the population that spends x or less of their income on electricity consumption an optimal pareto efficient tariff is designed based on the analysis of survey data and an econometric model and the armenian tariff rate effective 1 january 1997 to 15 september 1997 is shown to be non optimal relative to this rate

do fair trade and eco labels in coffee wake up the consumer conscience abstract in this study a face to face survey was conducted in order to reveal consumer preferences for ethical and environmentally sound labeling programs in coffee valuation questions regarding the fair trade shade grown and organic coffee labels were asked using a payment card format after consumers were previously informed about each of the labeling programs results suggest that consumers are very receptive toward both fair trade and shade grown coffee labels and consequently are willing to pay higher premiums for these labeling programs than for the organic coffee

directed giving evidence from an inter household transfer experiment abstract we investigate the determinants of giving in a lab in the field experiment with large stakes study participants in urban mozambique play dictator games where their counterpart is the closest person to them outside their household when given the option dictators do a large fraction of giving in kind in the form of goods rather than cash in addition they share more in total when they have the option of giving in kind compared to giving that can only be in cash qualitative post experiment responses suggest that this effect is driven by a desire to control how recipients use gifted resources standard economic determinants such as the rate of return to giving and the size of the endowment also affect giving but the effects of even large changes in these determinants are significantly smaller than the effect of the in kind option our results support theories of giving where the utility of givers depends on the composition not just the level of gift recipient expenditures and givers thus seek control over transferred resources

rationalizable bidding in first price auctions abstract we analyze the consequences of strategically sophisticated bidding without assuming equilibrium behavior in particular we characterize interim rationalizable bids in symmetric first price auctions with interdependent values and affiliated signals we show that 1 every nonzero bid below the equilibrium is rationalizable 2 some bids above the equilibrium are rationalizable 3 the upper bound on rationalizable bids of a given player is a nondecreasing function of her signal in the special case of independent signals and quasi linear valuation functions i the least upper bound on rationalizable bids is concave hence ii rationalizability implies substantial proportional shading for high valuations but is consistent with negligible proportional shading for low valuations we argue that our theoretical analysis may shed some light on experimental findings about deviations from the risk neutral nash equilibrium

an experimental investigation of the seller incentives in the epas emission trading auction the clean air act requires the epa to conduct annual auctions of emission allowances under the discriminative auction rules sellers with the lowest asking prices receive the highest bids this paper studies an inverted version of this auction in which buyers face the same incentives as sellers in the epa auction consistent with theoretical predictions buyers bid above their valuation auction outcomes are inefficient and increasing the number of buyers increases bids buyers facing human opponents compete more aggressively than the risk neutral prediction but bids do not differ systematically from this prediction when buyers face computerized nash robots copyright 1995 by american economic association

pathology of path dependency the ilo and the challenge of new governance using archival sources the authors study strategic and organizational change in the international labour organization ilo over the last twenty years they focus specifically on the ilo s efforts to incorporate certain elements of the new governance model into its policies and organizational practices which include the shift from standards expressed as detailed legal norms to soft law the active involvement of civil society organizations other than trade unions and employer associations in regulatory activities and the introduction of quantitative indicators of compliance with labor standards they argue that the efforts of the ilo leadership have been waylaid by the organization s corporatist structure which gives employer associations and trade unions veto power over policy developments at a time in which these actors are increasingly unable to agree on concrete policy measures finally the authors ask whether this corporatist structure accurately reflects the ilo s self defined mission prov

public policies on corporate social responsibility the role of governments in europe over the last decade corporate social responsibility csr has been defined first as a concept whereby companies decide voluntarily to contribute to a better society and cleaner environment and second as a process by which companies manage their relationship with stakeholders european commission 2001 nowadays csr has become a priority issue on governments agendas this has changed governments capacity to act and impact on social and environmental issues in their relationship with companies but has also affected the framework in which csr public policies are designed governments are incorporating multi stakeholder strategies this article analyzes the csr public policies in european advanced democracies and more specifically the eu 15 countries and provides explanatory keys on how governments have understood designed and implemented their csr public policies the analysis has entailed the classification of csr public policies taking into consideration the actor to which the governments policies were addressed this approach to the analysis of csr public policies in the eu 15 countries leads us to observe coinciding lines of action among the different countries analyzed which has enabled us to propose a four ideal typology model for governmental action on csr in europe partnership business in the community sustainability and citizenship and agora the main contribution of this article is to propose an analytical framework to analyze csr public policies which provide a perspective on the relationships between governments businesses and civil society stakeholders and enable us to incorporate the analysis of csr public policies into a broader approach focused on social governance

energy use in a transitional economy the case of poland abstract this paper provides a sectoral analysis of how energy use has changed in poland since the 1970s with particular emphasis on changes since the country began its transition from a centrally planned to a market economy in 1990 total final energy use in 1991 was 25 below that in 1988 and the lowest since the mid 1970s the most important factors behind the large decline in polish energy use in 1990 were a sharp fall in industrial output and a huge drop in residential coal use driven by higher prices energy use declined by only 2 in 1991 which was less than the fall in gdp of 8 key factors that lessened the decrease in energy use after 1989 were a rise in energy intensity in many heavy industries and a shift toward greater use of cars and trucks in passenger and freight transport higher energy prices have had an evident impact on residential coal use but in industry there was relatively little sign of energy conservation in 1991

theory and misbehavior of first price auctions recent experimental evidence appears to reject simple nash equilibrium models of bidding behavior in first price auctions the author presents a methodological critique of this evidence existing tests have concentrated on deviations of subjects from predictions in the message space of the action bid deviations the author suggests that it is more natural to evaluate subject behavior in expected payoff space he concludes that the evidence against the simple models is not significant enough to warrant their rejection copyright 1989 by american economic association

multi dimensional reference dependent preferences in sealed bid auctions how most laboratory experiments differ from the field abstract we study bidding behavior in first and second price sealed bid auctions with loss averse agents our model predicts overbidding in first price induced value auctions consistent with evidence from most laboratory experiments substantially different bidding behavior could result in commodity auctions where money and auction item are consumed along different dimensions of the consumption space differences also result in second price auctions our study thereby indicates that transferring qualitative behavioral findings from induced value laboratory experiments to the field may be problematic if subjects are loss averse

manufacturing energy use in eight oecd countries decomposing the impacts of changes in output industry structure and energy intensity this paper examines trends in manufacturing energy use in eight oecd countries decomposing the changes that occured between 1973 and 1987 into the effects of changes in aggregate manufacturing activity industry structure and energy intensities measured at the industry group level while manufacturing production grew in every country except the uk the rate of growth was variable from nation to nation structural change led to modest reductions in energy use in most countries although in norway structural change led to substantial growth in energy use the reduction in energy intensities was strikingly uniform across all nations ranging from 20 norway to 36 japan over the period of the analysis while other studies have used divisia decomposition techniques we use an alternative method based on laspeyres indices a comparison of the two techniques shows that they yield closely similar empirical results although the laspeyres approach is more easily interpreted while the interactions between changes in structure and intensity are arbitrarily assigned to the two factors by the divisia approach the lapeyres method yields interaction terms that explicitly account for such effects

the corporate social performance financial performance link strategic managers are consistently faced with the decision of how to allocate scarce corporate resources in an environment that is placing more and more pressures on them recent scholarship in strategic management suggests that many of these pressures come directly from sources associated with social issues in management rather than traditional arenas of strategic management using a greatly improved source of data on corporate social performance this paper reports the results of a rigorous study of the empirical linkages between financial and social performance corporate social performance csp is found to be positively associated with prior financial performance supporting the theory that slack resource availability and csp are positively related csp is also found to be positively associated with future financial performance supporting the theory that good management and csp are positively related 1997 by john wiley sons ltd