consumer demand for food diversity evidence for germany abstract whereas a large number of empirical studies have been devoted to analysing consumer demand for specific products much less attention has been paid to the household s demand for product variety the number of different products consumed in a specific time period this paper analyses consumer demand for food variety in germany the econometric analysis of 4632 households suggests that variety significantly increases with income and the number of children aged between 7 and 17 years and is significantly higher if the family lives in larger cities in east germany and the housekeeping person is not additionally working full time a single male household consumes a significantly smaller number of different food products the significant and positive impact of household income on food variety is in line with the hypothesis that consumption evolves along a hierarchical order as income increases

the illusory effects of saving incentives on saving the authors evaluate research on how tax based saving incentives iras and 401 k s affect saving previous research overstates the impact of the incentives on saving by failing to account for several issues households with saving incentives have stronger tastes for saving than others saving incentives have interacted with debt nonfinancial assets financial markets and pensions and saving incentives represent pretax balances whereas taxable accounts represent posttax balances accounting for these issues essentially eliminates the impact of saving incentives on saving the authors conclude that little if any of the contributions to existing saving incentives have raised saving

the effect of pension plan type on retirement age distinguishing plan incentives from career length preferences the widespread movement from dened benet db plans to dened contribution dc plans over the past few decades has transferred much of the retirement savings risk from the institution to the individual particularly in the private sector this study uses the retirement condence

nutritional status during an economic crisis evidence from russia between 1996 and 1998 russia experienced a spectacular decline in economic activity which was followed by a dramatic rebound between 1998 and 2000 we use panel data to examine the impact of variation in household resources on six dimensions of nutritional status distinguishing longer run from short term fluctuations in resources nutritional status is very resilient to short term variation in household resources gross energy intake adult weight and child stature change very little as expenditure deviates from its long run average longer run resources have a substantively large positive and significant effect on energy intake diet quality adult weight and child stature the evidence indicates that individuals and households are able to weather short term fluctuations in economic resources at least in terms of maintaining body mass and energy intake increased globalisation has resulted in many less developed countries becoming more integrated into world markets this integration carries both benefits and costs for the populations of those countries an oft cited cost is elevated risk of exposure to economic fluctuations which has been manifest in several spectacular economic crises across the globe in the last few decades there is however little evidence on the extent to which individuals and families are able to mitigate deleterious effects of these economic upheavals on their well being in spite of its importance for understanding the consequences of globalisation this article provides new evidence on this issue specifically we examine the relationship between several dimensions of nutritional well being and variation in household resources during the russian economic crisis in the late 1990s the economies of the former soviet bloc have been especially volatile since the transition to market based economies which began in the early 1990s nowhere has this been more true than in russia where in the last half of 1998 real gdp collapsed by around 30 and then rapid growth brought the economy back to its pre crisis level by 2000 the time path of changes in gdp is closely mimicked by changes in the incomes and expenditures of russian households using extremely rich longitudinal household survey data from the russian longitudinal monitoring survey rlms we examine the impact of these large fluctuations in household resources on nutrient intake and on anthropometric markers of nutritional status at the individual level in so doing we address an important issue in the literature regarding the extent to which households in low income settings are able

how retirement saving programs increase saving this paper summarizes the authors work on the effect of ira and 401 k contributions on net personal saving they consider many different nonparametric approaches to controlling for heterogeneity in individual saving behavior and conclude that the weight of the available evidence suggests that contributions to both iras and 401 k s largely represent new saving the authors devote particular attention to reconciling their results with the findings in other studies that reach different conclusions sometimes using the same databases that the authors analyze methodological limitations that undermine the reliability of results in other studies explain many of these disparities

an emprical model of the demand for a varied diet this study attempts to measure some aspects of the household s demand for a varied die by invesigaing how he number of individual foods consumed b he household is affeced b is preferences and food expendiure a heoriical model suggesed b household production theory is adopted to empirical data from a cross section of households it is found that the number of individual foods consumed is strongly responsive to househjold expenditure on all foods

demand systems estimation with microdata a censored regression approach demand systems estimation increasingly makes use of household level microdata mainly to measure the effects of demographic variables data based on these household expenditure surveys present a major estimation problem for any given household many of the goods have zero consumption implying a censored dependent variable techniques which do not take this censored dependent variable into account will yield biased results we utilize a censored regression approach that is computationally simple consistent and asymptotically efficient the results are then presented and compared with those obtained using an uncensored technique

poverty food consumption and nutrition during the transition to the market economy in eastern historically average reported levels of food intake in eastern europe have been considerably higher than in most middleincome countries according to food balance sheet data average calories proteins and fats in terms of availability per capita rose continuously over the 1961 1988 period and generally exceeded the intake requirements established by the world health organization who food and agriculture organization 1991 while it may rightly be argued that these data offer little information about the effective control over food by consumers in different income groups in the case of pre reform eastern europe full employment low income inequality and low food prices generally ensured a minimal level of food intake even for those in the bottom deciles of the income distribution while undernutrition did not generally represent a problem considerable imbalances affected the diet of most people in the region particularly in urban areas and among low income groups food intake was characterized by a high consumption of cholesterol rich products such as eggs and animal fats sugar salt bread and alcohol and a low intake of good quality meat fruit and vegetables and vegetable oils the data in table 1 clearly illustrate this situation for russia and can be taken as representative of the entire region low income families consumed less food per capita while their diet was characterized by greater intake both in relative and absolute terms of bread and fats and a lower consumption of more nutritious and healthy foods the dietary imbalances implicit in this consumption pattern caused an abnormally high incidence of nutritionally related health problems including a high prevalence of overweight people cardiovascular diseases micronutrient deficiencies and anemia in addition a fairly high prevalence of low birth weight lbw and low breastfeeding rates were common in the region inadequate breastfeeding represented a critical nutritional problem for young children as milk substitutes and baby foods were generally in short supply

a test of the habit formation hypothesis using household data numerous studies have confirmed the importance of habit formation as represented by a lagged dependent variable in demand analysis although all work to date has been based on aggregate time series data this study uses household level bls interview panel data to test the habit hypothesis an interrelated demand system for seventeen goods is estimated from cross section data and compared with a similar system based on time series data the results show that the habit component is significantly different between the two data sets and much smaller in the cross section data habit effects while not as large in cross section data as time series are still highly significant several explanations are offered concerning why the two sets of estimates differ copyright 1991 by mit press

the thrifty food plan and low income households in the united states what food groups are being neglected food assistance programs in the united states provide low income households with the resources to purchase a healthy nutritious and palatable diet if they buy the market baskets of food outlined in the thrifty food plan this study compares the cost of these baskets with actual spending on food at home by low income households simulations reveal at home food spending by low income households to represent only 86 of what is needed to follow the thrifty food plan married couples with children and female headed households with children spend only 73 and 82 respectively and just 43 and 50 for at home fruits and vegetables

the evolution of engel curves and its implications for structural change theory the tendency for expenditure engel curves to flatten out at high income levels is frequently cited as evidence that major shifts in household spending patterns take place as households become more affluent empirically little has been done to examine i how pervasive this tendency is across the engel curves of different goods and services ii whether the rate at which engel curves flatten out may significantly change over time and iii how robust engel curves are in the face of changes in the income distribution of households using data from the uk family expenditure survey we find evidence that the tendency for engel curves to flatten out which we dub saturation is indeed widespread across a wide range of goods and services however a tendency for their shape to shift over time and for these shifts to co move with changes in the income distribution of households casts some doubt on whether the declining slope of engel curves can be used to predict slowdowns in the growth rate of demand for particular goods and services

how product innovation in the north may immiserize the south a new look at the ricardian model with a continuum of goods abstract the paper proposes a theoretical model investigating the welfare consequences of technological shocks in a ricardian framework a la dornbush fisher and samuelson 1977 contrary to the existing literature the model incorporates a nonhomothetic demand function whose price and income elasticities are endogenously determined by technology nonhomothetic preferences are modeled as the result of the hierarchical consumption of luxury and necessity goods the nature of technical progress determines the consumption pattern and notably the magnitude of the substitution effect between necessities and luxuries the model is applied to the case of trade between two economies with different development levels it is shown in particular that the developing country can suffer a fall in utility as a result of technical progress in the developed country biased towards luxury goods this configuration depends on the size of the development gap and reflects the fact that southern goods are less attractive the higher the range of goods consumed this result suggests that there is an optimal level of development gap to avoid ldcs being harmed by technical progress in the north

variety prices and food status in low income households the basic premise of this paper is that a household receives utility directly from the status of a food composite good which is created by combining a household s skill and creativity in preparing foods other inputs and the kinds and amounts of foods available we proceed to investigate the factors influencing the demand for and prodcution of this composite good the demand for food status in influenced most by the following characteristics race education houshold size homeownership region of household residence and income direct price effects were minor estimates of a food status production function imply that the production of food status is not much a matter of the quantities of foods consumed but rather the types of food purchased variety and the creativity of the homemaker

new evidence on pensions social security and the timing of retirement using a unique dataset that links the economic and demographic information of households with the details of their pension formulas i estimate the combined effect of social security and pension benefits on the probability of retirement in a cross section of the population near retirement age the accrual rate of retirement wealth is shown to be a significant determinant of the probability of retirement simulations of extensions in pension coverage comparable to those that occurred in the early postwar period can account for one fourth of the contemporaneous decline in labor force participation rates 1998 elsevier science s a all rights reserved

an analysis of the principal agent problem most analyses of the principal agent problem assume that the principal chooses an incentive scheme to maximize expected utility subject to the agent s utility being at a stationary point an important paper of mirrlees has shown that this approach is generally invalid we present an alternative procedure if the agent s preferences over income lotteries are independent of action we show that the optimal way of implementing an action by the agent can be found by solving a convex programming problem we use this to characterize the optimal incentive scheme and to analyze the determinants of the seriousness of an incentive problem

hierarchic demand and the engel curve for variety ahstract the usual treatment of consumer demand theory assumes a solution to the demand equations with positive quantities of all commodities this paper characterises a class called hierarchic demand systems for which only a subset of commodities are in the purchased set the hierarchic linear expenditure svstem is used to illustrate interesting properties of such systems the empirical section shows how the number of commodities purchased expands with total expenditure both in aggregate and for commodity groups the data clearly establish the empirical importance of corner solutions and of the purchase decision in demand studies

how will 401 k pension plans affect retirement income two decades ago most workers with pensions had a defined benefit db plan the employer made necessary contributions and investments to meet promised pension benefit payments when the employee retired by 1993 the tide had turned more than half of covered employees participated primarily in defined contribution dc pensions such as 401 k plans employee benefit research institute ebri 1997 this dramatic shift was associated as well with growing concerns about the emerging 401 k plans some viewed 401 k plans as a crisis waiting to happen when current generations having made minimal or no contributions to their dc plan retired with inadequate pension asset balances karen ferguson and kate blackwell 1995 anne willette 1995 another concern was that workers switching jobs would use the lump sum distributions for houses boats or other purchases rather than reinvesting them in another retirement account ellen e schultz 1995 u s department of labor usdol 1998a in a similar vein newly retired workers may not roll over the assets into an annuity and therefore risk spending down their retirement wealth too early e g jeffrey r brown and mark j warshawsky 2001 the most serious charge against 401 k plans

promotional programmes and consumer purchasing decisions pecan demand models a generalized heckman model of purchase decisions is estimated incorporating perceived consumer quality attributes ease of purchase and familiarity with marketing outlets as factors influencing pecan purchases economic implications for evaluating consumer purchase decisions and the design of commodity promotion programmes for the pecan industry are addressed key marketing variables such as the variety of uses for nut products the number of outlets used to purchase pecans and consumer perceptions of positive quality features of pecans are significant in promoting purchases applications of a trade off analysis examine key variables considered by the pecan industry in developing promotional programmes both to stabilize pecan purchases and to maintain the probability of pecan purchases

modelling entrepreneurship unifying the equilibrium and entry exit approach two approaches can be distinguished with respect to modelling entrepreneurship i the approach focusing on the net development of the number of entrepreneurs in an equilibrium framework and ii the approach focusing on the entries and exits of entrepreneurs in this paper we unify these approaches to arrive at a model explaining the equilibrium and actual number of entrepreneurs and the entry and exit rate of entrepreneurs simultaneously and consistently we apply our unified approach to the netherlands using self employment data for the 1960 1999 period we find error correction of about 20 per year and a very different situation in terms of disequilibrium before and after the early 1980s periods of high unemployment appear to be characterized by both high entry and high exit rates

defined contribution plans defined benefit plans and the accumulation of retirement wealth abstract the private pension structure in the united states once dominated by defined benefit db plans is currently divided between defined contribution dc and db plans wealth accumulation in dc plans depends on a participant s contribution behavior and on financial market returns while accumulation in db plans is sensitive to a participant s labor market experience and to plan parameters this paper simulates the distribution of retirement wealth under representative db and dc plans it uses data from the health and retirement study hrs to explore how asset returns earnings histories and retirement plan characteristics contribute to the variation in retirement wealth outcomes we simulate dc plan accumulation by randomly assigning individuals a share of wages that they and their employer contribute to the plan we consider several possible asset allocation strategies with asset returns drawn from the historical return distribution our db plan simulations draw earnings histories from the hrs and randomly assign each individual a pension plan drawn from a sample of large private and public defined benefit plans the simulations yield distributions of both dc and db wealth at retirement average retirement wealth accruals under current dc plans exceed average accruals under private sector db plans although dc plans are also more likely to generate very low retirement wealth outcomes the comparison of current dc plans with more generous public sector db plans is less definitive because public sector db plans are more generous on average than their private sector db counterparts

empirical age earnings profiles the human capital earnings function in which earnings are expressed as a quadratic in potential experience is probably the most widely accepted empirical specification in economics in spite of its widespread acceptance the human capital earnings function provides a very poor approximation of the true empirical relationship between earnings and experience the standard formulation understates early career earnings growth by about 30 50 and overstates midcareer growth by 20 50 however simple alternative specifications that fit the data are available

what the stock market decline means for the financial security and retirement choices of the near retirement population this paper investigates the effect of the current recession on the retirement age population data from the health and retirement study suggest that those approaching retirement age early boomers ages 53 to 58 in 2006 have only 15 2 percent of their wealth in stocks held directly or in defined contribution plans or iras their vulnerability to a stock market decline is limited by the high value of their social security wealth which represents over a quarter of the total household wealth of the early boomers in addition their defined contribution plans remain immature so their defined benefit plans represent sixty five percent of their pension wealth simulations with a structural retirement model suggest the stock market decline will lead the early boomers to postpone their retirement by only 1 5 months on average health and retirement study data also show that those approaching retirement are not likely to be greatly or immediately affected by the decline in housing prices we end with a discussion of important difficulties facing those who would use labor market policies to increase the employment of older workers

institutional and individual investors saving for old age this paper brings together the academic literature on individual and institutional investors in order to understand the nature of difficulties faced by them and set the background for the special issue this introductory article and the papers in the special issue contribute to the debate on how to support individuals in their savings commitments and investment decision making and whether and how institutional investors have fulfilled their role in supporting the development of the funded pension industry there are three main conclusions i individual investors are not ready for the role that has been assigned to them in the pension industry ii institutional investors are a long way short of establishing healthy relational contracts and trustworthy relationships with their clients and iii more effective regulation may be needed

access to variety contributes to dietary diversity in china in the canonical consumer demand problem an agent makes a decision about quantities to consume under the assumption that all varieties can be accessed at zero cost in reality the cost of accessing variety may not be zero in this paper we study the effect of variety access cost on the consumption of food variety and its role in explaining regional differences in dietary diversity in china we find that a higher cost of access negatively affects the individual s ability to diversify her diet in terms of both the total counts and the balancing of varieties consumed the primary policy implication of this research is that attempts to create a healthy food environment in china must be differentiated along rural and urban lines in rural communities where consumers have been limited in their ability to diversify food baskets by high electricity and transportation costs infrastructure development and modernization may effectively improve nutritional balance for more urbanized communities where the cost of consuming additional food variety is relatively low food policies might instead focus on interventions that promote healthy eating to mitigate the burden of over nutrition

demand for food variety in an emerging market economy using food intake survey data collected in bulgaria in 1997 this study identified socioeconomic and demographic factors affecting demand for varied diet as measured by the count of food items and entropy index consumer preference for food variety exhibited different patterns depending on the length of time allowed for consumption estimated correlation coefficients indicated that daily variety deviated from that measured weekly and monthly regression analysis showed that regional effects differed across the three periods of time illustrating that the length of time allowed for consumption is an important element in measuring the demand for food variety

foreign profits and domestic investment abstract the paper considers investment incentives in corporate tax systems which grant an imputation credit to shareholders when dividends are distributed from domestic sources an increase in the dividend tax rate which is induced by lowering the shareholders imputation rate is shown to potentially depress domestic investment this result is common to old view models which assume that new equity is the marginal source of firms finance in this paper however the result is derived in a tax capitalization framework where retentions are the marginal source of finance and dividend tax rates are usually regarded as neutral

the demand for varied diet with econometric models for count data a negative binomial model was used to study the relationships between food expenditures household characteristics and the demand for different food items the results show that increases in food expenditure increase the number of food items consumed at home and the number of food items consumed at home is positively related to increases in the number of household members this change in the number of food items consumed at home increases at a decreasing rate as household size increases and becomes negative when household size becomes large

taxation portfolio choice and debt equity ratios a general equilibrium model this paper explores the portfolio behavior of investors differing with respect to both tax rates and risk aversion emphasizing the role of constraints on individual and firm behavior in ensuring the existence of and characterizing portfolio equilibrium under certain conditions on the securities available in the market which also are necessary for shareholders to be unanimous in supporting firm value maximization investors will be segmented by tax rate into two groups one specialized in equity and the other in debt though the relative wealths of the two groups determine the aggregate debt equity ratio each firm will be indifferent to its financial policy

the consumer s demand for diversity abstract the consumer s demand for diversity is measured either by the entropy or by the hirschman herfindahl index of the budget shares this notion including the income elasticity of the demand for diversity is applied to per capita consumption data of 30 countries

the assessment financial liberalization financial systems and economic growth the report addresses four sets of issues mac roeconomic policy to promote growth the role of financial liberalization govemmentinterventionin credit markets and the design of financial systems it puts forward the following blueprint for reform reform should start by getting the fiscal deficit under control and establishing macroeconomic stability the government should then scale down its directed credit programs and adjust the level and pattern of interest rates to bring them into line with inflation and other market forces in the initial stage of reform the govern ment should also try to improve the foundations of finance that is the accounting and legal systems procedures for the enforcement of contracts disclosure requirements and the structure of prudential regulation and supervision it should encourage managerial au tonomy in financial institutions if institutional insol vency is widespread the government may need to re structure some financial institutions in the early stages of reform world bank 1989 p 127

recent developments in the theory of corporate finance the field of corporate finance is a vast one in order to keep this paper manageable i shall focus on two well known puzzles of corporate finance the first has been described by black 1976 as the dividend puzzle and the second by myers 1984 as the capital structure puzzle underlying these two puzzles are similar considerations both originate in the application of competitive equilibrium analysis to corporate financial behaviour in two classic papers by modigliani and miller modigliani and miller 1958 miller and modigliani 1961 modigliani and miller showed that if firms and investors enjoy the same financial opportunities then under conditions of perfectly competitive capital markets no asymmetries of information between different agents and no variations in the tax treatment of different forms of finance corporate financial policy is irrelevant the value of a firm is determined entirely by its real decisions and is completely unaffected by the ratio of debt to equity finance in its capital structure or by the amount of dividends it pays out for a given investment plan the stark contrast between modigliani and miller s theoretical analysis and empirical observations of the importance attached to capital structure and dividend decisions by both firms and investors is part of the capital structure and dividend puzzles but it is not all for it remains true that nearly thirty years after the original modigliani miller paper was first published despite enormous efforts on the part of many researchers a proper understanding of what determines companies borrowing and dividend decisions is still elusive

a structural retirement model the life cycle model analyzed here constrains most work on the main job to be full time partial retirement entails a wage reduction and frequently a job change maximum likelihood estimates of utility function parameters are designed to incorporate information on the age of leaving full time work and the age of full retirement the model closely tracks retirement behavior including peaks in retirement activity at 62 and 65 the paper explores the relation of these peaks to nonlinearities in the budget constraint created by various retirement programs policy analyses based on this and on earlier models with simpler structures are compared the retirement choice is one of the more prominent manifestations of life cycle behavior the decision is the result of an interplay between an individual s preferences and a set of incentives which change in complicated ways as the individual progresses through his or her late 50 s and 60 s the purpose of this study is to formulate and estimate a structural model which incorporates in a fundamental way this interplay between lifetime preferences and incentives and to illustrate how such a model may be used to investigate retirement behavior a structural model of this type is essential for analyzing potential policy changes which can be expected to affect incentives in varying ways over a number of years in the life cycle the current study incorporates two structural features which have frequently been omitted from previous studies first the model requires that an individual who wishes to reduce work effort below full time must accept a reduced hourly wage rate in order to do so this reflects empirical evidence from micro data sets which indicates that around one third of older individuals engage in part time work at one time or another and that regardless of whether or not these older workers change jobs to obtain part time work they usually take wage cuts as compared to their previous full time work 2 the fact that an individual is willing to accept a lower wage rate in return for the opportunity to work fewer than full time hours contains important information about the preferences of the

assessing the effectiveness of saving incentives concluding that iras and 401 k s do increase saving this text provides a fresh cost benefit approach for analyzing the success of savings incentives it compares the new savings to the government tax revenue lost through contributions to iras and 401 k s

estimation of complete demand systems from household budget data the linear and quadratic expenditure systems in this paper we explore two issues in empirical demand analysis the estimation of complete systems of demand equations using household budget data section i and the incorporation of demographic characteristics into such systems section ii although there are numerous studies which use time series data to estimate complete demand systems and many which estimate engel curves from household budget data there are virtually none which combine budget data from different periods to estimate complete systems since each budget study corresponds to a single price situation one might conjecture that estimation of complete systems would not be possible unless budget studies were available from a large number of periods this is incorrect in section i we argue that interesting complete demand systems can be estimated from a small number of budget studies despite the limited price variability represented in such data to demonstrate this we use budget study data for two periods to estimate a pair of related demand systems the familiar linear expenditure system les and a quadratic expenditure system qes a generalization of les in which the demand equations are quadratic in total expenditure the inclusion of demographic variables in the analysis of household consumption patterns is desirable because there are likely to be systematic differences in the consumption behavior of households with different demographic characteristics but the effects of demographic characteristics have seldom been studied within the framework of complete demand systems in section ii we propose translating as a general method for incorporating demographic variables into complete systems of demand equations this method has not previously been discussed as a general technique for bringing demographic variables into demand systems although it has been employed in several studies to improve the estimates of the les and the qes presented in section i we reestimate these two systems using translating to incorporate family size

the cross price effect on willingness to pay estimates in open ended contingent valuation abstract previous literature has shown that potential buyers use a reference price or product to form their opinion about the value of a new product therefore the pricing decision is an interactive process we investigate the two generalizations of the cross price effect the neighborhood price effect and the asymmetric price effect on consumer willingness to pay wtp for multiple similar products in an open ended contingent valuation context results show that the cross price effect on wtp is prominent with the neighborhood price effect holding in contingent valuation no conclusions are reached about the asymmetric price effect

the quantity and variety of households meat purchases a censored demand system approach this study investigates the demand for 10 disaggregated meat products by u s households a censored demand system which imposes budget constraints in both observed and latent shares is estimated along with a detailed explanation of the estimation procedure additional details about the methodology not provided in previous studies should help researchers to empirically apply the model an innovation of the study is to introduce the censored demand system model for studying the variety of a household s food purchases most households buy between seven and eight different products and hardly change the variety of their purchases with changes in meat expenditure