the hyperinflation model of money demand revisited in this paper we propose a test of the hyperinflation model of money demand which is valid under any assumption concerning agents expectations subject only to the restriction that forecasting errors are stationary it is also demonstrated that highly efficient parameter estimates can be obtained and restrictions on them tested under the same weak assumption finally it is shown how these first stage estimates can be utilized to test the stronger assumption of rational expectations the arguments are illustrated by analysis of the classic data on european hyperinflations previously analyzed by cagan 1956 barro 1970 and abel dornbusch huizinga and marcus 1979 copyright 1991 by ohio state university press

evolution of the economics of agricultural policy agricultural economists helped develop farm programs to respond to the dire economic situation of the 1920s and 1930s some early authors appreciated that such policies created problems in markets for commodities and inputs over time our understanding of agricultural issues and policies has deepened through the application of improved models and tools of analysis to more extensive data we have developed better answers to old questions and have responded to changing policy instruments market contexts and policy concerns this article traces the evolution of our deepening economic understanding of the causes and consequences of agricultural policy

the decoupling of farm programs revisiting the wealth effect recent reforms of agricultural policies in developed countries have introduced direct payments as replacements for traditional production enhancing instruments whereas these new instruments can in principle influence production through several channels current empirical studies show no significant impact on production direct payments mainly increase land values in this article we revisit the evaluation of the coupling effects passing through the wealth of agricultural households the initial wealth of these agents while mainly being in the form of land asset holding is always assumed to be fixed to the contrary we show theoretically and through an empirical simulation exercise that once the impact of farm programs on initial wealth is properly accounted for the measure of the coupling effects is not as negligible as found in previous studies copyright 2010 oxford university press

those returning to income assistance this paper presents descriptive information about returnees to income assistance in british columbia ia ia returnees are defined as those who had a spell on ia over the previous two years dropped off ia for one or more months and hence were at risk of returning and who subsequently returned to ia factual information on the ia returnee population is a potentially important input into policy discussions of how the self sufficiency prospects of those on welfare might be improved leading to desired reductions in welfare caseloads and expenditures there has been little previous research on ia returnees in canada more is known about repeat recipients of unemployment insurance ui see corak 1993 our data are described in section ii section iii provides information about the returnee population including comparisons with the population of those leaving ia our evidence suggests that it is a mistake to focus ia policy reforms mostly on single women with children important overlaps between the ia and ui programs are also documented in section iii we present estimates of the probability of return to ia for various groups this paper draws on a 1993 preliminary study by bruce bailey cragg nakamura and warburton

acreage decisions under risk the case of corn and soybeans an acreage supply response model is developed under expected utility maximization the resulting framework is used to specify and estimate a system of risk responsive acreage equations for corn and soybeans in the united states particular attention is given to the truncation effects of government price supports on the distribution of corn and soybean prices also a wealth variable is included in the acreage equations the empirical results indicate that risk and wealth variables play an important role in cornsoybean acreage decisions the analysis also shows that cross commodity risk reduction is important in acreage allocation decisions

estimating the demand for a new technology bt cotton and insecticide policies this article examines the potential demand for bt cotton in the southeast from information gathered in the first year of commercialization we combine revealed preference rp data on adoption of bt cotton varieties with stated preference sp data on willingness to adopt to estimate demand using a double bounded maximum likelihood procedure using estimated demand equations we simulate the costs of reducing conventional insecticide applications through subsidization of bt cotton results indicate that reducing cotton insecticide applications by 40 in the southeast would require a 21 acre subsidy with total annual program costs between 53 million and 60 million

incentive effects of the u s welfare system a review the author would like to acknowledge support for prior work on this topic from the u s department of health and human services and helpful comments from three anonymous referees rebecca blank howard chernick john fitzgerald irwin garfinkel peter gottschalk edward gramlich david greenberg judith gueron james heckman v joseph hotz robert hutchens michael keane frank levy larry mead michael murray robert plotnick anuradha rangarajan philip robins howard rolston jeffrey smith and daniel weinberg all opinions and errors are those of the author alone

did canadian welfare reform work the effects of new reform strategies on social assistance participation this paper measures the extent to which declines in social assistance sa participation were associated with novel and aggressive reforms referred to as new reform strategies work requirements diversion earning exemptions and time limits controlling for province specific benefit levels eligibility requirements gdp growth labour market conditions and demographics sa participation rates were more than one percentage point lower equivalent to a 13 decline in provinces with new reforms work requirements with strong sanctions had the sharpest negative associations new reform strategies explain at least 10 of observed declines in sa participation twice that of benefit levels and eligibility requirements

testing for rational bubbles with exogenous or endogenous fundamentals the german hyperinflation once more abstract the presence of rational price bubbles during the german hyperinflation is tested under two different structural assumptions on the money process if the money supply is constrained to be exogenous to the current inflation rate the hypothesis of no bubble can be rejected however this is no longer found to be true when a feedback rule from inflation to money creation is allowed the analysis contradicts previous results presented in the literature

decoupled farm payments and the role of base acreage and yield updating under uncertainty we analyze the coupling effect of expectations about base acreage and yield updating in future farm policy on production decisions in the presence of price yield and policy uncertainty for a risk averse farmer producing a single crop the farmer receives market revenue and government payments using stochastic dynamic programming optimum decisions under present value calculations positively link current acreage and fertilizer decisions to future government payments through expected updates of base acreage and yield in the future regime moving from a zero probability of updating to a probability of one increases optimum acreage and yield by 6 25 and 0 134 respectively copyright 2010 oxford university press

an alternate method of estimating the cagan money demand function in hyperinflation under rational expectations abstract an alternate method of estimating the cagan money demand function under rational expectations is presented the technique utilizes the side assumptions that 1 accurate contemporaneous information on the price level and money stock is available to individuals and 2 unobservable noise in the portfolio balance schedule is neglible the procedure has three main virtues first it is implemented without imposing restrictions on the money supply process second the procedure is extremely simple and economical third it admits a simple test of a restriction implied by the cagan money demand function results are related to issues in recent hyperinflation studies

the effects of policy expectations on crop supply with an application to base updating we develop a dynamic model to assess the effects of policy expectations on crop supply and illustrate the approach with estimates of the effects of base updating in u s crop programs for corn and soybeans in the corn belt the effect of base updating is relatively small because relevant crop alternatives are subject to similar policies and the alternatives are substitutes in production increasing acreage of one program crop to capture future payments from base updating reduces future payments from the alternative crop we also use our model to assess the effect of base updating on acreage response to prices

cointegration and cagan s model of hyperinflation under rational expectations when money and prices are integrated of order two philip cagan s 1956 model of hyperinflation will give rise to two different levels of cointegration in most of the literature on the german hyperinflation one of these cointegrating relationships has been ruled out a priori by assuming that velocity shocks follow a random walk using data from the german hyperinflation the author finds this assumption to be unjustified based on a straightforward extension of the cointegrated var approach suggested by john y campbell and robert j shiller 1987 a method to evaluate the cagan model under rational expectations and no bubbles is proposed and implemented to the german data copyright 1993 by ohio state university press

analyzing the length of welfare spells abstract this paper studies the determinants of the length of individual spells of welfare focusing on how the length of a spell affects the probability of its termination the analysis utilizes six years of monthly data on time spent in the afdc program among female household heads a variety of duration dependence models are estimated monthly afdc participation does not show strong evidence of duration dependence two distinct groups appear to utilize welfare one with a very low and constant probability of leaving welfare and a second group which is more affected by time on the program

disability insurance rejection rates and the labor supply of older workers abstract we investigate the effects of trying to mitigate moral hazard in the disability insurance di program by raising the stringency of the screening process for applicants we do so by studying a dramatic increase in rejection rates for the di program in the late 1970s which varied substantially across the us states we find that each 10 rise in denial rates led to a statistically significant 2 8 fall in labor force non participation among 45 64 year old males we also find that the denial rate increases effectively targeted their incentive effects to more able individuals according to an anthropometric measure of disability

an untold story the characteristics of welfare use in british columbia the dynamics of welfare participation are analyzed using a unique longitudinal data set derived from provincial administrative records over the period 1980 92 the principal findings are that the majority of welfare spells are experienced by single men and women without children and that while most welfare spells are short there is a high incidence of recidivism although continuous long term use and dependence on welfare is not characteristic of most recipients experiences the program does not provide an effective route to financial independence since most users periodically return to the program

the effects of farm subsidies on farm exports in the united states we estimate the elasticity of u s farm exports to u s farm subsidies using a gravity model of state level farm exports to 100 major trading destinations for the period 1999 to 2011 our identification strategy exploits the within state variation that is free of endogeneity bias in the levels and trends of farm subsidies and farm exports we find that a 1 decrease in farm subsidies would reduce u s farm exports by 0 40 per annum this equivalently means that the complete abolishment of the farm subsidy program would reduce u s farm exports by approximately 15 3 billion per year importantly we document robust evidence that amber box subsidy programs such as counter cyclical payments and marketing loan gains have the strongest effect on farm exports while green box subsidy payments such as direct payments have negligible effects finally subsidy payments affect exports only in agricultural commodities not in livestock our subsidy elasticity estimates are statistically significant stable and economically meaningful and are vitally needed by u s and global policymakers in the face of critical domestic and international developments

tightening a welfare system the effects of benefit denial on future welfare receipt abstract we derive local average treatment effect estimates of the impact of welfare benefit denial on future receipt using a unique experiment involving reassessment of some applicants who were originally slated to receive benefits we find evidence of considerable heterogeneity among applicants our results support a model with a peripheral group who exhibit scarring effects from being granted benefits and a core group who do not the core group moves quickly back onto welfare when they are denied benefits even for the peripheral group benefit denial has intermediate term but not permanent impacts

do counter cyclical payments in the 2002 us farm act create incentives to produce analytical results in the literature suggest that counter cyclical payments create risk related incentives to produce even if they are decoupled under certainty hennessy d a 1998 the production effects of agricultural income support polices under uncertainty am j agric econ 80 46 57 this paper develops a framework to assess the risk related incentives to produce created by commodity programmes like the loan deficiency payments ldps and the counter cyclical payments ccps in the 2002 us farm act because ccps are paid based on fixed production quantities they have a weaker risk reducing impact than ldps the latter have a direct impact through the variance of the producer price distributions while the impact of ccps is due only to the covariance between the ccp and the producer price distributions the methodology developed by chavas j p holt m t 1990 acreage decisions under risk the case of corn and soybeans am j agric econ 72 3 529 538 is applied to calculate the appropriate variance covariance matrix of the truncated producer price distributions under the 2002 farm act risk premia are computed showing that the risk related incentives created by ccps are significant and do not disappear for levels of production above the base production on which ccps are paid

multi country tests for price level bubbles abstract flood and garber 1980 have examined data from the german hyperinflation to test for a price level bubble in this paper we extend this research to other episodes of hyperinflation by testing for a simultaneous bubble across countries we implement the conceptual experiment proposed by flood and garber to derive asymptotic distributions for the test statistics

supply response to countercyclical payments and base acre updating under uncertainty an experimental study we design an experiment to simulate how people make agricultural production decisions under three policy scenarios each incorporating direct payments dps a price uncertainty without countercyclical payments ccps b price uncertainty with ccps and c price uncertainty ccps and uncertainty regarding base acreage updating results are the ccp program and perceived possibility of future base updating created incentives for subjects to invest more in program base crops despite payments being decoupled from current production decisions those choosing to reduce revenue risk by increasing plantings of base crops may face reduced incomes suggesting the efficiency of crop markets may be diminished

the impact of decoupled payments on farm choices conceptual and methodological challenges abstract in this paper we review the methodological framework for analysing decoupled payments in models of agricultural production market and technological uncertainty farm efficiency credit constraints farm household choices involving extra agricultural decisions policy uncertainty and long run impact of decoupling on investment and land values are the relevant issues that should be pursued by methodological and empirical analysis future research should refine the analysis of decoupled payments mainly trying to provide results that can be useful for policy simulation to bridge the gap between analysis at the individual level and sector policy models

who was affected by new welfare reform strategies microdata estimates from canada abstracta heterogeneous mix of aggressive welfare reforms took effect in different provinces and years starting in the 1990s welfare participation rates subsequently declined previous investigations of these declines focused on cuts in benefits and stricter eligibility requirements this article focuses instead on work requirements diversion earning exemptions and time limits referred to jointly as new welfare reform strategies while controlling for benefit levels eligibility requirements province specific labour market conditions and gdp growth as well as individual level socio economic information province year specific variation in new reform strategies produce estimates implying that their presence is associated with a large decline in welfare participation of 1 3 percentage points 14 relative to the unconditional mean participation rate of 9 2 our coding scheme generates new measures of policy variation that distinguish reductions in benefit levels and tighter eligibility restriction

the high scope perry preschool program cost benefit analysis using data from the age 40 followup this paper presents an updated cost benefit analysis of the high scope perry preschool program using data on individuals aged 40 children were randomly assigned to a treatment or control group program costs are compared against treatment impacts on educational resources earnings criminal activity and welfare receipt net present values are calculated for participants the general public and society the treatment group obtains significantly higher earnings for the general public higher tax revenues lower criminal justice system expenditures and lower welfare payments easily outweigh program costs they repay 12 90 for every 1 invested however program gains come mainly from reduced crime by males