modeling the earnings and productivity of agricultural economists discussion data from the 1981 82 registry of agricultural economists sponsored by the illinois department of labor and the american agricultural economics association are used by strauss and tarr to estimate earnings and productivity parameters for agricultural economists a short run predictive model is employed to compare the earnings of agricultural economists among different employer types including educational institutions federal government state and local government private business and miscellaneous international government inferences are drawn from the different types of employers large and small educational institutions women and blacks versus whites in a 1971 paper strauss referred to a crisis caused by the failure to find the most desirable position upon entry in the market by new ph d s such a situation is occurring in the early 1980s helmberger studied the market for agricultural economists in the early 1970s concluding that an excess supply would exist throughout the 1970s and into the 1980s boulding gave attention to the need for increasing the supply of black economists generally during this period suggesting that the economics profession is culture bound boulding suggests a subculture among economists which may explain the racial sexual structure and characteristics strauss and tarr revisit the market for economists considering some market and nonmarket factors

two sided uncertainty and up or out contracts a bilateral moral hazard problem provides a rationale for up or out employment contracts the employer sets a wage higher than opportunity cost to induce the worker to invest in firm specific capital if the individual does not make the grade it is in the firm s interest ex post to fire him had the initial arrangement not included provisions for firing individuals the firm would underreport the value of the employee wrecking the incentive scheme the basic model permits both firm and worker to be risk neutral therefore it admits a straightforward multiperiod extension which we also investigate

environmental policy with endogenous plant locations in a game between the governments of two countries each chooses its own environmental policy the nash equilibria of the game are generally not pareto optimal on the one hand each country may want to attract industry giving it an incentive to choose low environmental taxes or standards on the other hand if disutility from pollution is sufficiently high each country might prefer that a firm locates only in other countries this effect tends to make the environmental policy under non cooperation stricter than it would be with cooperation

location choice by households and polluting firms an evolutionary approach this paper examines several policy regimes to deal with the problem of households suffering from environmental damage by firms in the same region we employ an evolutionary framework to analyze migration movements in the course of time since firms and households will not relocate immediately in response to payoff differentials we show that taxation gives firms and households an incentive to stay away from each other laissez faire compensation only gives households firms an incentive to stay away from firms households we find that taxation creates the right incentives to reach a local welfare maximum however when there are multiple local maxima circumstances may arise under which compensation leads to a better outcome than taxation c 2004 elsevier b v all rights reserved

renegotiation design with unverifiable information this paper considers a buyer seller relationship with observable but unverifiable investments and or random utility parameters in such situations it is known that contract renegotiation may prevent the implementation of first best outcomes in this paper we show however that efficient investments and optimal risk sharing can typically be achieved provided the initial contract is able to monitor the ex post renegotiation process specifically we focus on the following two features of renegotiation design first default options in case renegotiation breaks down second the allocation of all bargaining power to either contracting party moreover we show that these two features can be obtained in standard rubinstein bargaining games through contractual provisions such as specific performance clauses and penalties for delay or equivalently financial hostages refundable without interest

a gift is not always a gift heterogeneity and long term effects in a gift exchange experiment we study gift exchange in a field experiment where a random subsample of participants in the swiss labour force survey received vouchers to be used in adult training actual voucher redemption can be traced giving us the unique opportunity to study whether gift exchange in the form of participation in future rounds of the survey depends on the perceived usefulness of the gift the group of voucher recipients as a whole has significantly higher response rates there is considerable heterogeneity however our results point to a long lasting gift exchange relationship only for the subgroup that redeemed their vouchers

does environmental dumping lead to delocation environmental dumping is often viewed as an instrument used by some countries in the attempt to attract foreign investments stated otherwise the delocation of firms would be a major outcome of a stiff environmental policy in this paper we study the impact of a strict anti pollution policy pursued by a government on domestic firms locational decisions and determine the main variables that interact with such a policy some preliminary welfare implications are also provided

population mobility and transboundary environmental problems abstract a standard result in the literature on environmental economics is that efficient environmental policies regulating transboundary pollution will be adopted only if there is interjurisdictional coordination efficient policies can be adopted as a result of interregional treaties or mandated by a central authority the present paper demonstrates that if there is perfect population mobility between the regions affected by the transboundary pollution the efficient outcome is a nash equilibrium of the policy game between regional authorities this is true independently of what policies are available to the regional authorities however there may be more than one nash equilibrium so that policy coordination may be necessary in order to achieve the best equilibrium

international environmental agreements as evolutionary games this paper applies evolutionary game theory to international environmental agreements ieas contrary to stage game models barrett in j theor politics 11 519 541 1999 eur econ rev 45 1835 1850 2001 in an evolutionary equilibrium ee no signatory prefers to be outside the iea and the ee is robust to trembles with two populations there is a unique interior ee when there is decreasing returns to abatement and small asymmetry in the externality differences across populations at the interior ee transfers from the poor to the rich can increase payoffs for all nations but come at the expense of greater payoff inequality transfers can also eliminate the basin of attraction for the payoff inferior ee with decreasing returns to abatement and large asymmetry thus ieas such as the kyoto treaty predicated on the polluter pays and ability to pay principles may result in pareto inferior outcomes

is firm sponsored education viable abstract this paper challenges the commonly held human capital assumption that profit maximizing firms cannot invest in their employees general training we argue that general training is provided to equilibrate a hostage type relationship that exists when firms and workers share investments in specific training and that the firm s investment in general training is not necessarily subject to poaching hazards we then test the viability hypothesis empirically using data from a longitudinal survey of natural and social scientists and engineers our results suggest that 1 firm investments in general training programs are not necessarily paid for by foregone earnings and 2 turnover rates do not rise as a function of firm sponsored general training these results are discussed in terms of the current policy debate over corporate education expenditures

spreading versus concentrating damages environmental policy in the presence of nonconvexities abstract this paper examines the role of nonconvexities in externality control from a policy perspective nonconvexities can arise from a number of sources and can significantly alter the optimal solution to an externality problem for instance it may be socially desirable to concentrate externality damages in one area and prohibit them in another rather than spread the effects of the externality across a number of sites if this solution is optimal a pollution tax will not achieve the social optimum but a system of marketable permits will

worker reciprocity and employer investment in training standard economic theory predicts that firms will not invest in general training and will underinvest in specific training empirical evidence however indicates that firms do invest in general training of their workers evidence from laboratory experiments points to less underinvestment in specific training than theory predicts we propose a simple model in which a firm invests the socially optimal amounts in general and specific training if the worker is sufficiently motivated by reciprocity a reciprocal worker may be willing to give the firm a full return on its investment we present empirical evidence that supports the proposed mechanism workers with a high sensitivity to reciprocity have 15 higher training rates than workers with a low sensitivity to reciprocity

why do firms train theory and evidence this paper offers a theory of training whereby workers do not pay for the general training they receive the superior information of the current employer regarding its employees abilities relative to other firms creates ex post monopsony power and encourages this employer to provide and pay for training even if these skills are general the model can lead to multiple equlibria in one equilibrium quits are endogenously high and as a result employers have limited monopsony power and provide little training while in another equilibrium quits are low and training is high using microdata on german apprentices we show that the predictions of our model receive some support from the data

trade and transboundary pollution spatial separation reconsidered abstract copeland and taylor 1999 j int econ 47 137 168 show that trade allows the spatial separation of two incompatible industries concentrating the polluting industry in one country eliminates its degenerative effects in the other this paper extends the analysis by allowing for transboundary pollution thus specialization has indirect repercussions on the level of pollution in the other country we show i how cross national differences in exposure to pollution emissions can generate comparative advantage and ii under what condition the resulting trading pattern combined with transboundary pollution can increase pollution exposure with negative effects on productivity and welfare in both countries

dynamic instability of a mixed city in the presence of neighborhood externalities it has been often asked whether a city currently accommodating a variety of economic social and racial groups will continue to be a mixed city or will become exclusively occupied by a single group particularly poor blacks with all other groups moving out of the city in the long run in order to answer this question properly it seems essential to develop a long run dynamic model of a city with emphasis on socioeconomic factors like neighborhood externalities within or among various groups of residents as well as spatial factors like the individual choice of residential space and location it might be safely said that in the literature the only theoretical work which employs a long run dynamic approach to this kind of problem is a paper on dynamic models of segregation by thomas schelling 197 1 although his socioeconomic analysis has revealed some of the dynamic properties of a racially mixed area with neighborhood externalities his model itself is quite unsatisfactory from the economic point of view since it lacks individual utility functions and thereby disregards the aspect of the individual choice of space and location within the city 2 as a result he failed to analyze the effect of spatial segregation within the city on the long run nature of the residential composition of the city in this paper i develop a long run dynamic model of an open city which accommodates two groups of households for example blacks and whites rich and poor young and old with their utility functions depending on a consumption good and residential space i also assume two kinds of neighborhood externalities the first is called negative intergroup externalities that is the utility level of a typical household in one group is adversely affected by an increase in the number of households in the other group living in the city the second is called positive intragroup externalities that is the utility level of a typical household in one group is positively affected by an increase in the size of its own group in in the city first i define a mixed city equilibrium as a long run equilibrium which allows the two groups to coexist in the city in the long run and then introduce a dynamic adjustment process of household movement into and out of the city it is proved that the mixed city equilibrium is always unstable in the presence of negative intergroup externalities and or positive intragroup externalities if residential land is perfectly homogeneous and there is no differential transport cost incurred within the city it turns out however that in the case of a monocentric city with positive transport cost the mixed city equilibrium may be stable or unstable depending on the degree of neighborhood externalities because of the stabilizing effect of spatial segregation between the two groups within the city

investment in general training the role of information and labour mobility following the seminal work of becker i964 it is widely accepted in the literature that firms will be unwilling to finance training which workers may use in other firms this paper takes issue with this prediction and suggests that firms will frequently share in the cost of such general training 1 becker argues that a firm which pays for the training of workers in skills of potential use to other firms will lose these workers since other firms bear none of the costs of general training they can attract a worker with such training by outbidding the firm which trained him recognising this absence of property rights over an investment in general training firms will refuse to provide it hence if general training is to take place the trainee will have to pay for it if potential trainees are unwilling or unable to pay general training will not take place a shortage in general training is likely to emerge this may be especially pronounced in developing countries 2 in contrast the outlook for

reciprocity and wage undercutting it is well documented that employers refuse to hire workers who o er their services at less than the prevailing wage the received explanation is that workers are motivated by reciprocity they desire to reward kindness and punish hostility to refuse an outsider s underbid is viewed as a kind choice that is met with good e ort a low wage is viewed as an insult that is met with shirking we have developed a general theory of reciprocity which in this paper is applied to a wage setting game played by an employer and two workers we show that when workers are motivated by reciprocity equilibrium behaviour accords well with the aforementioned stylized facts 2000 elsevier science b v all rights reserved jel classixcation d63 e24 j41

the existence and uniqueness of optimal pollution policy in the presence of victim defense measures abstract it is to be expected that rational people defend themselves against pollution externalities at the very least through spatial separation from the source but even in the simplest models defensive behaviour generates nonconvexities multiple optima and inconclusive policy guidance this raises serious questions for the theory of environmental policy which have been largely ignored this paper derives a sufficient condition for a uniquely optimal emissions level in the presence of defensive activity the condition has an intuitive and in principal empirically testable interpretation two strategies for implementation are discussed an iterative tax rule and a non iterative demand revealing mechanism

direct regulation of a mobile polluting firm abstract we compare noncooperative regional environmental policy to cooperative national policy for direct regulation of a mobile firm the national government can always reach its first best with commitment but not with time consistent policy with commitment regional policy results in a game of chicken with too little output or in not in my backyard without commitment regional policy may improve upon national policy this happens when regional policy discourages the investment whereas the welfare reducing investment does take place with national policy

salary patterns of agricultural economists in the early 1980s systematic explanation of wages in the service sector typically has been hampered by the absence of information on physical productivity of service workers frequently the analyst must rely on input information and make strong assumptions about the transformation of inputs and cost into outputs to model the long run pattern of wages in the service sector it may be sufficient to look primarily at relative wages and long term demand factors such as income and population a number of professions in the service sector have been successfully modeled using the familiar cobweb formulation for example hansen et al report the results of estimating a multiequation model of the long run supply and demand for economists generally and conclude among other things that the real salary of new ph d s will fall throughout this decade short run analysis of academic wages usually focuses on various sorts of earnings functions in which the natural log of earnings is regressed against a variety of human capital variables there is an extensive literature on the determinants of general economists salaries and on the determinants of salaries for agricultural economists on salary determinants see for example boddy hansen weisbrod and strauss strauss tolles and melichar and tuckman gapinski and hagemann among others which have examined various aspects of the general market for economists for agricultural economists salaries see for example broder and ziemer 1980 1982 fuller helmberger lane lee lundeen and clausen melichar peck and babb schotzko schrimper ziemer broder and spurlock and redman the more recent literature has emphasized the importance of using actual productivity measures such as publications in explaining variations in earnings along with human capital variables a deficiency in some of this second type of research involves the absence of a welldefined theoretical justification for particular statistical specifications and the reliance on single equation models the objective of this study is to take advantage of a new relatively underutilized data source on agricultural economists in order to examine the general characteristics of agricultural economists and to examine the determinants of their salaries in the early 1980s in particular we examine the 1981 registry of agricultural economists maintained by the american agricultural economics association and the illinois department of labor the registry when examined in conjunction with melichar and unpublished 1976 tabulations of the association s membership list indicate that it is broadly representative of the profession the plan of the paper is as follows the next section describes the data base and provides some general characteristics of agricultural economists in the early 1980s then we examine salary patterns of agricultural economists in various types of employment and focus in more detail on the salaries of academicians especially those who are from and at educational institutions with doctoral programs which have been ranked in terms of the quality of their faculty and in terms of the quality of their graduate programs special attention is paid to the salaries of female agricultural economists and differences in salaries attributable to the race ethnicity of agricultural economists we conclude with a prospectus on outstanding research issues robert p strauss is a professor of economics and public policy school of urban and public affairs carnegie mellon university michael j tarr is a student at cornell university the authors wish to express their gratitude to the aaea and dr emanuel melichar for making unpublished data available for this study and to farm foundation for financial support responsibility for the views and any errors in this paper rests solely with the authors

trade spatial separation and the environment we develop a simple two sector dynamic model to show how pollution can provide a motive for trade by spatially separating incompatible industries we assume that the production of smokestack manufactures generates pollution which lowers the prod uctivity of an environmentally sensitive sector farming two identical unregulated countries will gain from trade if the share of world income spent on smokestack goods is high in contrast when the share of world income spent on the dirty good is low trade can usher in a negatively reinforcing process of environmental degradation and real income loss for the exporter of smokestack goods 1999 elsevier science b v all rights reserved

projected replacement needs for agricultural economists comment in the august 1980 issue of this journal schotzko reported that the number of ph d s in agricultural economics required to offset anticipated retirements and deaths would increase during the next decade this finding is in contrast to recent concerns about overproduction and overeducation in the united states considering the rapid expansion of graduate enrollments in most fields cartter freeman implications of growth in the number of ph d s in agricultural economics during the 1970s were noted by helmberger boddy warned however that the scare talk about the current and prospective general ph d glut is greatly overdrawn in economics and agricultural economics the prospects are far less discouraging than in most other fields p 724 the primary purpose of this comment is to note some problems with schotzko s analysis a second purpose is to discuss some changes in the characteristics and aggregate number of ph d s granted in agricultural economics in the united states during the last two decades

the economics of private sector training a survey of the literature abstract this survey organizes and summarizes existing theoretical work on private sector training the theoretical models focus on investment efficiency finance and turnover recent developments in the on the job training literature are characterized by strategic interaction between employers and employees and emphasize market imperfections

worker financed versus firm sponsored training how are skilled workers supplied to the economy a search and matching model of general human capital is developed to contrast worker financed training with firm sponsored training to evaluate which type of training might prevail in the economy it will be shown that firm sponsored training is more likely to occur when there is greater friction in the labour market whereas worker financed training prevails in a less frictional market moreover the model has multiple equilibria in labour markets with intermediate friction comparative statistics exercises tell us that reductions in labour market friction result in less firm sponsored training in the economy but encourage worker financed training

employability miles and worker employability awareness this article studies the use and impact of a employability miles voucher scheme these vouchers could be used for participation in a restricted number of training courses which all aim to stimulate employees to develop a more active attitude towards their own employability using data from two surveys of one firm s workforce we find that voucher use is related to various personality traits and personal characteristics in particular a worker s ambition goal setting and education level are positively related to voucher use in addition workers with longer tenure spend their vouchers more often conversely workers with a more positive self image as well as those who are negatively reciprocal spend their vouchers less often the negative relation between voucher use and negative reciprocity suggests that workers who are more negatively reciprocal perceive the voucher as an hr tool for outplacement further we find that voucher use positively affects worker employability awareness and willingness t

negative externalities and evolutionary implementation in this paper we model externality abatement as an implementation problem our model incorporates techniques from evolutionary game theory assuming that agents dynamically adjust their choices in response to the incentives they currently face we offer a simple condition on aggregate payoffs under which a planner with limited information about preferences can nevertheless ensure that efficient behaviour is globally stable finally we present a series of applications that show that our sufficient condition holds in a variety of models involving negative externalities