inflation and the savings rate in this paper we examine two explanations of the observed positive relationship between inflation rates and savings rates in canada and the united states several models are estimated using quarterly time series data from both countries and the best of these are subjected to a variety of tests one of the two explanations appears to be broadly consistent with the data it is that the observed relationship arises primarily because in times of inflation measured income and measured savings overstate the corresponding real and perceived quantities

a framework for the analysis of evolving patron client ties in agrarian economies abstract this paper looks systematically at the various factors that can account for the disappearance or the transformation of the institution of patronage that used to structure labor and other relationships in many agrarian societies of the past it is an attempt to offer a unifying framework capable of guiding one s attention to the relevant variables and to the way they interact in this process the rather simplistic view according to which there is a unique linear path through which patronage evolves is called into question and a number of different scenarios are instead presented these alternatives are illustrated with reference to asia

diminished expectations redistributive preferences in truncated welfare states in latin america the relationship between income and support for redistribution is weak and variable despite the region s extreme income inequality this article shows that this condition is rooted in the truncated structure of many latin american welfare states heavy spending on contributory social insurance for formal sector workers flat or regressive subsidies and informal access barriers mean that social spending does far less for the poor in latin america than it does in advanced industrial economies using public opinion data from across latin america and original survey data from colombia the author demonstrates that income is less predictive of attitudes in the countries and social policy areas in which the poor gain less from social expenditures social policy exclusion leads the poor to doubt that they will benefit from redistribution thereby dampening their support for it the article reverses an assumption in political economy models that welfare exclusion unleashes demands for greater redistribution instead truncation reinforces skepticism about social policy helping the poor welfare state reforms to promote social inclusion are essential to strengthen redistributive coalitions

anticipated versus surprise inflation in household consumption behaviour abstract the purpose of this paper is to look at the question of whether it is the anticipated or surprise inflation or both that matter for household consumption and saving behaviour we use a large data sample from 23 countries covering mostly the period 1960 1979 evidence is overwhelming against the hypothesis that only the surprise part of inflation matters for household consumption and saving behaviour but is a bit mixed on the question of whether the anticipated and surprise parts of inflation affect with equal force which would justify the observed inflation as the appropriate inflation variable in household consumption and saving functions

labor tying in a poor agrarian economy a theoretical and empirical analysis in this paper we show how tied labor contrary to its common characterization as a feudal relic and as a symptom of economic stagnation may actually be strengthened by capitalist agricultural development we construct a simple two period theoretical model of a two tiered labor market to show how the proportional importance of voluntary labor tying contracts may increase with yield increasing improvements and with a tightening of the labor market we then provide in support of these hypotheses some general historical as well as more detailed econometric evidence from a variety of cross sectional data in rural india

theories of share tenancy a critical survey for the past 2 decades the problems of agricultural tenancy have attracted a great deal of attention not only from agricultural economists but also from economists in general as a typical example of agencyprincipal contract relations despite the prolific growth of literature both theoretical and empirical there has been little convergence in opinions on tenancy contracts the divergence has been especially great on the understanding of the causes and the effects of sharecropping tenancy much confusion underlying the widely divergent perspectives has stemmed from partial treatments of contractual choice which unduly limit the optimizing behavior of contracting parties and the options of contract forms this essay aims at clarifying the sources of the confusion by reviewing the past literature in light of the more general theory of agency principal relations the agency theory in order to examine the problems of various theoretical models in a unified framework in section ii we first develop the basic framework of a general model of tenancy contract in section iii we clarify in terms of the general model contradictions latent in the traditional marshallian theory which asserts that share tenancy is inefficient because of the disincentive effect of cropsharing on the tenant s work effort in section iv we attempt to show that recent efforts to reconstruct the theory based on the traditional assumption have not yet been quite successful section v draws implications and testable hypotheses from more general theories incorporating the aspects of risk and uncertainty section vi tests allocational and distributional implications of those alternative hypotheses based on the summary of evidence col

competition among officials and the abuse of power traditional economic theory suggests that competition among officials providing government goods tends to reduce corruption however empirical evidence does not yet support this view in this paper i show that a corrupt and powerful central authority can use competition among officials to amass resources for itself while competition reduces corruption at the lower level of government corruption at the higher level of government is increased to avoid widespread theft from the central authority competing officials are monitored more intensively than a monopolist hence even though competition among officials generates more consumer surplus it may reduce welfare

voluntary dis saving and expected inflation savings behavior under inflationary conditions is receiving increasing attention in the literature one example is deaton s 2 investigation of the positive impact of unanticipated inflation on personal involuntary saving this paper will develop and test a model to explain the relationships between expected inflation and personal voluntary dis saving these two variables will be connected by means of anticipated real wealth effects where real wealth is defined to include both storeable commodities and financial or liquid assets expected future inflation may result in an anticipated loss of future real wealth in order to offset this loss and retain anticipated real wealth at its desired level nominal wealth must be either rearranged or increased this means that expected inflation can have either a negative or a positive effect on personal voluntary saving it is useful by way of explanation to distinguish between durables which are storable and are a form of real wealth and non durables and services which are non storable and are not a form of real wealth durables are consequently not included in consumption rather they are included in purchases the national accounts definition of expenditure refers to purchases not consumption purchases of durables and personal saving are treated separately however because as explained below they are substitute means of retaining anticipated real wealth at its desired level there is thus a three way division of income into personal saving purchases of durables and purchases of non durables and services this seems to be the easiest solution to the treatment of durables moreover it follows the national accounts definition consequently this paper will refer to purchases and expenditure functions rather than consumption and consumption functions on the one hand given the expected future price of non durables and services expected increases in the future price of durables may make it worthwhile for an individual to purchase durables and store them for future use through dissaving thus anticipated real wealth is retained at the desired level by the accumulation of real assets durables and the reduction of financial assets saving nominal wealth is thereby rearranged durable purchases and saving in the form of financial assets are substitute means of retaining anticipated real wealth at its desired level consequently there should be a negative relationship between expected inflation of the price of durables and the personal savings rate on the other

determinants of private savings behaviour in turkey this study investigates the effects on private saving rates of a number of policy and non policy variables the analysis covers the period 1968 1994 the empirical private saving model for turkey is estimated the findings support the hypothesis that private saving rates have strong inertia the evidence indicates that government saving does not tend to crowd out private savings and the ricardian equivalence does not hold strictly income level has a positive impact on private saving rate and growth rate of income is not statistically significant from a policy point of view financial depth and development measures in turkey suggest that countries with deeper financial systems tend to have higher private saving rates private credit and real interest rates try to capture the severity of the borrowing constraints and the degree of financial repression for turkey moreover the negative impact of life expectancy rate lends support to the life cycle hypothesis the precautionary motive for saving is suppor

limited liability and the existence of share tenancy abstract the paper considers the problem confronting an absentee landlord who can lease out his land on a fixed rent contract share rent contract or a mixture of the two it is argued that in poor areas it is natural to have each contract underwritten by an implicit limited liability clause which allows a person to forego paying rent under extreme crop failures in the presence of such an implicit clause a certain tension appears between a tenant and a landlord with the former preferring risky projects and the latter preferring safe ones it is shown that in such a case share tenancy turns out to be the dominant system from among the class mentioned above because it minimises the tension between the landlord and the tenant the result is then used to discuss conditions under which share tenancy will tend to wither away

interlocking transactions obstacles precursors or instruments of agrarian capitalism abstract rural labor arrangements often change rapidly and in ways that prevailing theories cannot explain explicit understanding of the exercise of power in rural society sheds considerable light on how and why rural labor arrangements change in the course of economic development this paper shows how different labor tying arrangements embody exclusionary mechanisms that can serve as instruments of both labor management and social control macro political and economic conditions shape the ways in which these mechanisms operate and are in turn influenced by them viewing labor arrangements in this way helps resolve problems confronted by the prevailing theories and allows for a broader understanding of dynamic processes

market failure and control of labour power towards an explanation of structure and change in indian agriculture part 1 1 although existing approaches do on occasion shed light on certain specific aspects of indian agriculture in general they run into problems of methodology or content or more frequently both in particular it is misleading to treat indian agri culture in peasant economy no markets or neoclassical perfect market terms and problematic to view it as semi feudal markets subordinate to extra economic factors 2 analysis of the relationships between farm size land productivity sharecropping and mechanisation suggest the need for an integrated model which emphasises both the unemployment and poverty of poor peasants and the problems of supervision and control of wage labour and tenants 3 proper appreciation of the interlinked role of these factors can help to explain the system s inability to combine the abundant labour of the poor with resources owned largely by the rich it can also go on to explain institutional responses like sharecropping as partial solutions to the problem of intensifying labour use and technological ones such as mechanisation as a means of delinking large farm growth from the need to intensify labour use 4 the tensions and choices between these responses underlie both the problem of stagnation and the phenomenon of switches from sharecropping to mechanisation 5 for associated reasons more rapid growth in indian agriculture is unlikely without major institutional changes to create much new employment and is likely to be more capital intensive than is usually assumed

does immigration undermine public support for social policy there has been great interest in the relationship between immigration and the welfare state in recent years and particularly since alesina and glaeser s 2004 influential work following literatu

permanent labour and land tenancy contracts in agrarian economies an integrated analysis extending the existing models of land and labour contracts this study attempts to build a general model of long term agrarian contracts the model implies that where tenancy is an available option the fixed wage permanent labour contract will not be chosen if it is chosen under institutional constraints on tenancy contracts resulting resource allocations will be inefficient empirical relevance of the model is tested on data from the philippines

an efficiency and welfare classification of rationing by waiting in the presence of bribery abstract governments often allocate commodities at low prices and on a first come first served basis rationing by waiting while bureaucrats who distribute the commodities usually take bribes a model is developed to classify the efficiency implications of bribery and socially optimal pricing schemes in rationing by waiting if the rationed good and individual income spent on other goods other income are complements then bribery may enhance allocative efficiency and a dual pricing scheme can augment social welfare however if the rationed commodity and other income are substitutes then bribery may not improve allocative efficiency and distributing the rationed commodity free is socially optimal

water allocation inefficiency and inequity in a government irrigation system abstract efficient and equitable allocation of irrigation water in a large multi user system must consider spatial temporal and seasonal differences in farm water use in developing countries centralized government management of canal systems typically allocates water according to simple fixed rules water allocation over a six year period is analyzed for a philippine government system and compared with estimated variability in farmer water utilization inflexibility of the present allocation is found to be inefficient with inequitable distribution of irrigation benefits among farmers

explaining social policy preferences evidence from the great recession to what extent do personal circumstances as compared to ideological dispositions drive voters preferences on welfare policy addressing this question is difficult because a person s ideological position can be an outcome of material interest rather than an independent source of preferences the article deals with this empirical challenge using an original panel study carried out over four years tracking the labor market experiences and the political attitudes of a national sample of americans before and after the eruption of the financial crisis the analysis shows that the personal experience of economic hardship particularly the loss of a job had a major effect on increasing support for welfare spending this effect was appreciably larger among republicans than among democrats a result that was not simply due to a ceiling effect however the large attitudinal shift was short lived dissipating as individuals employment situations improved the results indicate that the personal experience of an economic shock has a sizable yet overall transient effect on voters social policy preferences

the system of administrative and political corruption canal irrigation in south india the paper describes how some irrigation engineers raise vast amounts of illicit revenue from the distribution of water and contracts and redistribute part to superior officers and politicians it argues that the corruption system which is centred on control of personnel transfers is an important supply side reason for poor performance of canal irrigated agriculture insofar as the same system operates in other government departments it may be more important for understanding indian politics and the political influences on economic development than has previously been realised

tenure systems in traditional china i a general equilibrium model of tenure preference classical marginalists at least after john clark provide an unequivocal solution for the conventional factor market where people sell the productive services of their resources to producers the productexhaustion theorem says that if factors are priced according to their marginal products incomes of all resource owners will exactly exhaust the value of total products in the long run competitive equilibrium this holds true regardless of which factor is variable and which is fixed and regardless of which group of resource owners perform as producers who buy productive services of other resources in the market and claim residuals for themselves in an agrarian economy with land and labor as the inputs a land owner may cultivate his land and purchase the labor input from outside paying a wage rate in accordance with labor s marginal product the land owner is then the residual claimant alternatively he may lease out his land and receive a fixed rental rate per unit of area equal to the marginal product of land in this case the tenant is the producer and claims the residual income distribution between the two parties remains the same under each land arrangement wage and rent are therefore identical conceptually the classical marginal analysis has not presented a satisfactory theory of share tenancy which instead of being a seller buyer transaction in a conventional factor market is essentially a partnership arrangement between two persons who own complementary factors hence the term land renting will hereafter denote the fixed rent system exclusively in fact the direct application of marginal analysis to share tenancy has created considerable confusion in early economic literature only recently some general equilibrium models of land tenure systems have been developed for better understanding of the

does welfare conditionality reduce democratic participation the past 20 years have witnessed a shift to work based welfare conditionality within the advanced welfare states as access to social benefits are increasingly predicated on individuals agreeing to behavioral conditions related to participation in the labor market existing literature on the political consequences of this shift offers contradictory expectations while new paternalists claim that it should increase political participation among benefit recipients others argue that it has a depressive effect the majority of existing studies rely on cross sectional analyses which leaves them open to charges of selection bias utilizing multiple longitudinal research designs this article finds that conditionality has a depressive effect on patterns of democratic engagement welfare conditionality reduces political and civic participation political interest and efficacy and personal efficacy in disaggregating conditionality s effects across two client groups the article finds largely positive effects a

preferences in context micro preferences macro contexts and the demand for social policy political economists have increasingly looked to understand social welfare policy as a product of individual level demand for social spending this work hypothesizes that individuals with riskier j

saving and inflation some international evidence abstract this note contains empirical results for the disequilibrium saving function specification in which uncertainty about relative prices in a cross section sense plays a major role quarterly time series evidence from several oecd countries over the period 1967 ii 1980 iii lies in striking conformity with the view suggested particularly by deaton that there is a positive relationship between unanticipated inflation and the saving ratio

state retrenchment and the exercise of citizenship in africa what explains the varied ways that africans practice citizenship on an everyday basis and how does the extent of state building or neoliberal unbuilding in a particular context affect the way in

irrigation reform in conditions of populist anarchy an indian case abstract it is true that the performance of india s canal irrigated agriculture could be substantially and cheaply improved by change in canal operating and maintenance procedures but current procedures allow some farmers and state officials to capture disproportionate benefits for themselves through a well institutionalised system of corruption these beneficiaries of the status quo make up powerful interes groups against reform the paper illustrates just how intensely political irrigation reform can be by tracing what happened when an attempt was made to carry out an apparently simple improvement in water allocation rules under a south indian canal the events suggest a wider process of cumulative causation making for low rates of growth of food production and weaker political authority the process is not inevitable however and the paper ends with some suggestions about how in the irrigation context public policy might help to offset the decline

from poverty to perversity ideas markets and institutions over 200 years of welfare debate to understand the rise of market fundamentalism from the margins of influence to mainstream hegemony we compare the u s 1996 personal responsibility and work opportunities reconciliation act and the english 1834 new poor law two episodes in which existing welfare regimes were overturned by market driven ones despite dramatic differences across the cases both outcomes were mobilized by the perversity thesis a public discourse that reassigned blame for the poor s condition from poverty to perversity we use the term ideational embeddedness to characterize the power of such ideas to shape structure and change market regimes the success of the perversity thesis is based on the foundations of social naturalism theoretical realism and the conversion narrative in the poverty to perversity conversion narrative structural blame for poverty is discredited as empiricist appearance while the real problem is attributed to the corrosive effects of welfare s perverse incentives on poor people themselves

a closer look at small hydropower projects in india social acceptability of two storage based projects in karnataka abstract associated with being green clean and small scale small hydroelectric power shp projects generally enjoy a positive image in india shp promises answers to issues such as meeting a growing electricity demand facilitating lucrative investment opportunities and climate change considerations the features of being green clean and small scale have contributed to the assumption of shp as an essentially uncontested technology empirical studies questioning this assumption are scarce research on shp has so far remained rather hypothetical and policy level focused this article investigates the social acceptability of small hydroelectric plants in india by empirically looking at how people engage with these plants it thereby underlines the importance of studying technologies in their local context based on a detailed case study analysis of two shp projects in karnataka india the article shows how shp projects are contested on the local level the engagement of local people played a crucial role in the contestation of the plants and led to significant and unexpected outcomes and effects the article highlights the importance of having a broader perspective in the development of shp that goes beyond a mindset of technological fixes this includes taking account of existing water infrastructure and a broader range of water users the article shows that the implementation of shp projects does not take place in a void rather complex existing physical and social realities on the ground matter for the development and performance of shp

imperfect capital markets and the monetarist black box liquidity constraints inflation and the asymmetric effects of interest rate policy in this paper we examine the effects of unanticipated changes in interest rates on consumers expenditure in a model in which capital markets are imperfect we show that where constraints exist on the amounts individuals can borrow individuals may rationally choose to borrow up to the limits of such constraints over part of their lifetimes such liquidity constrained individuals in general have a higher marginal propensity to consume out of changes in current income than is the case with liquidity unconstrained individuals changes in interest rates which have the effect of redistributing income between liquidity constrained monetary debtors and liquidity unconstrained creditors will thus have a net effect on aggregate consumption we further show that this effect operates asymmetrically in the sense that an increase in interest rates will have a larger net impact than a fall formally we examine the impact of a change in the interest rate which we assume exogenous on the behaviour of an individual consumer the analysis is thus independent of the source of the interest rate shock 2 but we believe an important application of the model concerns the transmission mechanism through which monetary policy operates in this paper we do not consider the relationship between the supply of money and interest rates but simnply follow standard economic theory in assuming that monetary policy operates through the impact of interest rates on expenditure it is the mechanism linking interest rate changes to expenditure that has proved hard to identify and it is in this respect that our analysis may be relevant in suggesting a process through which interest rates can affect expenditure which appears to have been neglected hitherto the model provides a possible channel of transmission of monetary policy different from those usually considered 3 in so doing the model may offer some insight into the transmission processes within the monetarist black box and indeed suggests that the efficacy of monetary policy may in part depend on the existence of capital market imperfections

savings in new zealand during inflationary times measurement determinants and implications real rates of return predominantly as a result of in model of saving behavior is constructed to test the role creased price inflation and slow rates of economic growth for instance deane 1980 stated that inflation taxation and interest rate variables play in determining saving the estimation results are then the behaviour ofsaven in times of inflation is still one of the unsolved used to identify the implications for future economic mysteries of economics to the surprise of economists in the early growth in new zealand in terms of saving assuming 1970s when inflation was accelerating sharply in most western nations consumers saved a higher than expected percentage of the stressed in the literature their income p 377 that of releasing factors for capital formation

an inquiry into quasi credit contracts the role of reciprocal credit and interlinked deals in small scale fishing communities in agrarian village societies beset with many hazards and uncertainties people evolve various means of coping with risk what is perhaps less known is that credit transactions can sometimes serve the function of reducing risk in such societies this article is concerned with examining several insurance motivated credit arrangements in small scale fishing communities a hunger insurance mechanism of reciprocal credit and a system of interlinked contracts aimed at insuring against risks in the spheres of labour and marketing relations will be extensively dealt with moreover the concept of triadic relationships will be shown to have special relevance in the case of traditional insurance arrangements aiming at controlling problems of moral hazard

the market for public office why the indian state is not better at development abstract how and why officials are transferred from one post to another can in india does have far reaching consequences for the effectiveness of public service organizations such as irrigation agriculture forestry and soil conservation departments the transfer mechanism used in many departments of indian states involves a kind of internal labor market a truer market than in the way that term is often used by labor market economists it allows pressures for corrupt behavior to bear down on the incumbents of certain posts and itself amplifies those pressures frequently the pressures on officials to be corrupt cause them to behave in ways contrary to the ostensible objectives of their departments why is the indian state not better at promoting development to an important degree because of the corruption transfer mechanism and its effects on bureaucratic initiatives

a public transformed welfare reform as policy feedback this article analyzes the strategic use of public policy as a tool for reshaping public opinion in the 1990s progressive revisionists argued that by reforming welfare liberals could free the democratic party of a significant electoral liability reduce the race coding of poverty politics and produce a public more willing to invest in anti poverty efforts connecting this argument to recent scholarship on policy feedback we pursue a quantitative case study of the potential for new policies to move public opinion our analysis reveals that welfare reform in the 1990s produced few changes in mass opinion to explain this result we propose a general framework for the analysis of mass feedback effects after locating welfare as a distant visible case in this framework we advance four general propositions that shed light on our case specific findings as well as the general conditions under which mass feedback effects should be viewed as more or less likely