preserving religious identity through education economic analysis and evidence from the us abstract this paper models the decision of religious parents to send their children to private religious schools as reflecting their desire to shield their children from external influences and thus preserve their religious identity it follows that when the share of the minority in the local population grows and outside influences become less threatening the demand for separate religious schooling among the members of the religious group decreases this pattern implies concavity in the relationship between enrollment in private and religious schooling and the share of the religious group in the population we present empirical evidence from united states county data on catholic and private school enrollment that strongly supports our theory the paper contributes to a better understanding of the demand for religious education

financial returns under uncertainty for conventional and reduced impact logging in permanent production forests of the brazilian amazon abstract reduced impact logging ril techniques are designed to improve the efficiency of timber harvesting while mitigating its adverse effects on the forest ecosystem research on ril in select tropical forest regions has demonstrated clear ecological benefits relative to conventional logging cl practices while the financial competitiveness of ril is less conclusive we conduct a comparative analysis of financial returns to one and two cutting cycle logging entries for representative ril and cl operations of the eastern amazon observed variability in harvest efficiency and uncertainties of forest productivity are introduced in a stochastic simulation of future biological and financial returns to the alternative logging systems despite the perceived investment risks ril harvesting operations generate competitive or superior returns relative to cl for a wide range of discount rates due to gains in harvest efficiency and forest conservation

data watch research data in the economics of education economists have developed a wide variety of policy relevant empirical research projects that address the role of education in promoting individual and social welfare recent examples include studies on the impact of school spending on educational outputs the differences between public and private schools the effects of competition among schools the determinants of teacher quality the impact of unions on schools and the consequences of education finance reform one reason for the proliferation of such empirical studies has been the emergence of high quality micro level data on education in this paper we discuss three broad types of data sets data on educational institutions data on educational outcomes at the individual level and data sets from school reforms and experiments in each section we summarize some of the leading surveys discuss the general availability of the data and identify some but certainly not all of the research that has utilized these data this review is by no means exhaustive we have restricted our attention to analyses of data sets describing primary and secondary education moreover we emphasize data sets that are excellent sources of information but are less wellknown and utilized by economists in particular two obvious omissions from this review are the national longitudinal survey of youth nlsy and the panel study of income dynamics psid both are broad based studies that track people over periods of time gathering information both on educational attainment and on many other issues as well

the earnings and human capital of american jews this paper analyzes the earnings and returns from human capital investments of second generation american jews compared with non jews jewish men have 16 percent higher earnings other things the same a 20 percent higher rate of return from schooling and a steeper experience earnings profile these patterns persist even after controlling for occupation self employment status and geographic concentration in the new york area there are no systematic differences among jews by parents country of birth the findings suggest that american jews are more productive in creating and using human capital and that this has encouraged greater investments in human capital

the quality of schooling quantity alone is misleading although much research discusses the quantity of schooling as an effective impact on productivity and earnings most such research leaves out the idea of the quality of schooling which may cause biases in the estimated returns to schooling this paper consequently attempts to extend the standard mincerian approach to incorporate school quality as well as quantity it demonstrates how exclusion of quality in the standard procedure may cause biases in the estimated returns to years of schooling probably in the upward direction the paper explores the implications of this extension of the standard model for the case of young brazilian males it shows that the estimate of the private return to years of schooling using the preferred quality inclusive specification is only one half the estimate using the standard procedure indicating substantial upward bias in the standard estimates it further outlines a method for estimating a social return to quality and finds that it exceeds substantially the social return to quantity the paper then shows why this in turn suggests there may be an equity productivity trade off in schooling investments

technology and the demand for imports in the pure theory of international trade traded goods are generally viewed as finished products this is in sharp contrast with the fact that the bulk of world trade is in intermediate products to reconcile theory with facts a number of models of trade in intermediate products have been proposed in recent years most of these models have been used to investigate the validity of well known trade theorems in the presence of intermediate products 2 hence most of these models are rather complex generally allowing for two factors of production and two final goods as well as for one or two pure intermediate products 3 another feature common to most of these models and that is borrowed from standard trade theory is the assumption that production is nonjoint in input quantities 4 this assumption leads to a number of remarkable theoretical results but it also greatly increases the number of possible patterns of production and of interindustry flows and it thus adds to the complexity of the models furthermore if the number of goods is larger than the number of factors nonjointness leads to indeterminacy unless additional assumptions are made 6 these assumptions typically are that some goods are not produced domestically 7 or that some goods are not traded internationally 8 this further multiplies the number of possible cases and it explains perhaps why none of the models proposed so far has emerged as the benchmark model much in the same way as for

does immigration induce native flight from public schools into private schools abstract the paper tests whether native born american families respond to inflows of immigrants by sending their children to private school the analysis uses 1980 and 1990 census data from 132 metropolitan areas for primary school students no significant relation between immigration and private school enrolment is found for secondary schools a significant link emerges for every four immigrants who arrive in public high schools it is estimated that one native student switches to a private school white students account for most of this flight natives appear to respond mainly to immigrant children who speak a language other than english at home

comparing public and private schools the puzzling role of selectivity bias recent articles using the same data and variants of the same estimation technique report conflicting estimates of the relative quality of education provided by public and catholic schools this article explains the reasons for the conflict in so doing the article clarifies the assumptions underlying the increasingly popular two step methods for controlling selectivity bias and highlights the hazards of using these methods when the assumptions are not satisfied the article also illustrates an alternative method for detecting the presence of selectivity bias

religion religiosity and educational attainment evidence from the compulsory education system in england this paper investigates the effect of religion on the educational attainment of pupils in their final year of compulsory education in england the results show that pupils that identify with any re

protestantism and education reading the bible and other skills during industrialization protestants were more literate than catholics this paper investigates whether this fact may be led back to the intrinsic motivation of protestants to read the bible and to what extent other education motives might have been involved as well we employ a historical data set from switzerland which allows us to differentiate between different cognitive skills reading numeracy essay writing and swiss history we develop an estimation strategy to examine whether the impact of religious denomination was particularly large with respect to reading capabilities we find support for this hypothesis however we also find evidence which is consistent with the view that protestants education motives went beyond acquiring reading skills jel i20

a theory of anticipated utility abstract a new theory of cardinal utility with an associated set of axioms is presented it is a generalization of the von neumann morgenstern expected utility theory which permits the analysis of phenomena associated with the distortion of subjective probability

does school quality matter returns to education and the characteristics of public schools in the united states this paper estimates the effects of school quality measured by the pupil teacher ratio average term length and relative teacher pay on the rate of return to education for men born between 1920 and 1949 using earnings data from the 1980 census we find that men who were educated in states with higher quality schools have a higher return to additional years of schooling rates of return are also higher for individuals from states with better educated teachers and with a higher fraction of female teachers holding constant school quality measures however we find no evidence that parental income or education affects average state level rates of return

relative price effects and the demand for imports this paper addresses the issue of data selection in the estimation of import demand functions little attention is generally devoted to the choice of price and activity variables in empirical work yet this question is of crucial importance when estimated elasticities are used for instance to assess the effect of import price changes in a partial equilibrium framework or when elasticity estimates drawn from different sources are compared with each other throughout the paper imports are treated as intermediate products and the relationship between price and quantity elasticities corresponding to various specifications is established for constant and variable returns to scale prix relatifs etfonctions d importations ce m6moire examine le probleme du choix des donnees quand on veut faire la calibration de fonctions d importations le choix des indicateurs de prix et de niveau d activite ne regoit habituellement que peu d attention dans les travaux empiriques cette question est pourtant de grande importance quand on veut utiliser les mesures d elasticit6 qu on en tire pour evaluer les effets d un changement des prix a l importation dans le cadre d un modele d equilibre partiel ou lorsqu on d6sire comparer entre elles des mesures d elasticite construites a partir de sources differentes dans ce m6moire les importations sont considerees comme des biens intermediaires et l on etablit a la fois pour les cas de rendements a 1 echelle constants et variables la relation qui existe entre l lasticite par rapport au prix et l 6lasticite par rapport aux quantites pour un 6ventail de specifications du modele

a simple structural model of the swiss franc us dollar exchange rate this paper presents a simple structural model of exchange rate determination for switzerland 1976i 1982iv the model consists of four behavioural equations and four identities and it is estimated by full information maximum likelihood the model is well suited to simulate the effect on the swiss franc of domestic and foreign real and monetary shocks a number of simulation results are reported it appears that overshooting can be substantial particularly for real shocks

production theory technological change and the demand for imports aggregate import demand functions for switzerland 1948 1976 are estimated jointly with the supply and or demand functions for domestic outputs and inputs joint estimation not only yields more efficient estimates than single equation methods but it also ensures that the derived demand and supply functions are consistent with the underlying technology two specifications are examined one of them stressing the smallness and openess of the swiss economy as well as its flexible immigration policy the generalized leontief functional form is used in both cases special attention is devoted to the interpretation of the estimated price elasticities and various hypotheses of technological change are tested for

strength of preference and risky choice this paper provides conditions under which a utility function under risk can be legitimately interpreted to measure strength of preference between consequences these conditions require that if a decision maker regards the preference difference between acts a and b to be the same as the preference difference between acts a and b for every state of the world then the preference difference between a and b should be regarded as equivalent to the preference difference between a and b a key assumption is that a decision maker s preference differences between acts given one state of the world should be independent of common consequences given other states of the world usefulness of this result is discussed

risk and forest policy issues and recent trends in the u s abstract recent forest policy trends in the united states have implications for the nature timing and incidence of risk to which the public is exposed policy makers face enormous uncertainty both about what forests can do and be and about what people want forest policy that places a premium on shortrun predictability in the flow of commodity outputs is being replaced with policy that allows disturbances such as fire that are consistent with long run naturalness scientists advocate adaptive management the introduction of planned variation in order to enhance learning within the bounds of safety a concept that can only be understood in the context of public feelings and perceptions of risk this paper reviews economic models of choice under uncertainty and discusses issues that are relevant for understanding risk perceptions and preferences the definition of probabilities and the many attributes of risk and it examines the margins on which trade offs in risk are made in new forest policy arguing that because new forest policy shifts from public to private risk and from future to current risk it may enhance the common good finally this paper calls for policy to address uncertainty explicitly in a way that acknowledges public feelings and preferences about risk recognizes risk perceptions of experts and of lay persons and encourages developments in forest policy that allow for flexibility in the face of new knowledge

attractive compounds of unattractive investments and gambles a compound of many independent replicas of an investment or gamble may be attractive to some risk averters who do not accept the individual investment or gamble this can happen if there is a chance that the compound leads to a wealth level where the degree of risk aversion is lower than at the initial wealth level it can also happen if the investor has some sort of limited liability the von neumann morgenstern utility functions with the property that sufficiently long sequences of repetitions of any fair gamble are preferred to all finite wealth levels are characterized in this paper

choice under uncertainty problems solved and unsolved ffifteen years ago the theory of choice under uncertainty could be considered one of the success stories of economic analysis it rested on solid axiomatic foundations it had seen important breakthroughs in the analytics of risk risk aversion and their applications to economic issues and it stood ready to provide the theoretical underpinnings for the newly emerging information revolution in economics 1 today choice under uncertainty is a field in flux the standard theory is being challenged on several grounds from both within and outside economics the nature of these challenges and of our profession s responses to them is the topic of this paper

note further tests of aspiration level effects in risky choice behavior this note extends the work reported in payne laughhunn and crum payne j w d j laughhunn r crum 1980 translation of gambles and aspiration level effects in risky choice behavior management sci 26 1039 1060 on the need to incorporate a target return reference point or aspiration level concept in the analysis of risky choice behavior two experiments are reported the first experiment provides a more complete test of the model of reference point effects developed by payne laughhunn and crum a translation of outcomes procedure which adds a constant to all outcomes was used to vary the relationship of pairs of gambles to an assumed target or reference point the results fully support the model the second experiment provides evidence of the conceptual validity of the model by using explicit instructions to vary the target levels of managers while holding gamble values constant

the effects of cognitive ability and high school quality on college entry decisions nonparametric estimation of parameters of interest the decisions to attend college are analysed and nonparametric predictions compared to those obtained from the widely used logit model the impacts of measured cognitive ability and proxies for high school quality on the decisions to attend college are examined for a sample of white and black males and females from the usa two different parameters of interest which isolate the effects of ability and high school quality on college entry decisions are described and estimated by integrating out the effect of other covariates it is found that measured cognitive ability is an extremely important determinant of college entry for all race and gender groups at the same point in the ability distribution blacks are more likely to select into college than whites and females more likely than males of the same racial group proxies for high school quality such as teacher education student teacher ratios school enrolment and library size are shown to have little or no effects on the likelihood of college entry

the marginal cost of species preservation the northern spotted owl abstract because species survival is not certain the decision to save a species is not an all or nothing choice but rather a marginal one the appropriate unit for both benefit and cost functions is the likelihood of survival and the appropriate question is how certain we want to be of species survival the intensity of the species preservation debate is also fired by strong equity concerns we illustrate these points for the case of the northern spotted owl by constructing a marginal cost curve for its survival and by disaggregating welfare loss by region and by market level

the marginal utility of income does not increase borrowing lending and friedman savage gambles there has been a great deal of discussion about whether the marginal utility of income rises with income most notably milton friedman and leonard j savage argued in their classic paper that the willingness to gamble implies that the marginal utility of income is rising over a range the discussions of rising marginal utility and of friedman savage gambles have proceeded independently of the literature on time preference although the issues are in fact related logically drawing on this logical relationship we shall show 1 that at least when intertemporal utility is separable the stable levels of consumption that are usually observed imply that the marginal utility of income decreases as income rises 2 even if the marginal utility of income does increase friedman savage gambles normally will not maximize utility saving and dissaving can attain the levels of consumption which generate the most utility per dollar of income at a lower cost than gambles unless imperfections in the capital market are severe 3 even when the utility function is not temporally separable repeated gambling cannot be a rational way of dealing with a rising marginal utility of income we therefore conclude that observed gambling is seldom if ever explained by the logic set out in friedman and savage s seminal paper in view particularly of the stability of consumption levels and the lack of friedmansavage gambles we conclude that marginal utility of income does not rise with income i a conceptual framework

a risk return model with risk and return measured as deviations from a target return two attribute risk and return models are very popular in the economics and finance literature for analyzing decisions under uncertainty their popularity stems primarily from the intuitive appeal of the dichotomy into risk and return and from the ease with which the concepts can be diagrammed in two dimensions the most commonly used risk return model is the mean variance model in which risk is measured as the variance and return by the mean of the probability distribution over outcomes the mean variance model has a number of shortcomings which are widely known but of particular concern here are the facts that 1 mean variance dominance is neither necessary nor sufficient for second degree stochastic dominance 2 unless the form of the probability distribution is restricted mean variance is consistent with von neumann morgenstern utility theory only if the utility function is quadratic and 3 as peter fishburn has noted

school quality and black white relative earnings a direct assessment the wage differential between black and white men fell from 40 percent in 1960 to 25 percent in 1980 it has been argued that this convergence reflects improvements in the relative quality of black schools to test this hypothesis we assembled data on pupil teacher ratios annual teacher pay and term length for black and white schools in the eighteen segregated states from 1915 to 1966 these data are linked to estimated returns to education for southern born men from different cohorts and states in 1960 1970 and 1980 improvements in the relative quality of black schools explain 20 percent of the narrowing of the black white earnings gap between 1960 and 1980

catholic schools dropout rates and educational attainment this paper examines the effect of catholic schooling on high school dropout rates and educational attainment particular attention is given to the effect of selection into the catholic school sector after adjusting for self selection we find that sophomores in the catholic schools are still substantially more likely to graduate with their class it is also shown that seniors in the catholic schools are not more likely to acquire more schooling than other seniors if selection is taken into account

finishing high school and starting college do catholic schools make a difference in this paper we consider two measures of the relative effectiveness of public and catholic schools finishing high school and starting college these measures are potentially more important indicators of school quality than standardized test scores in light of the economic consequences of obtaining more education single equation estimates suggest that for the typical student attending a catholic high school raises the probability of finishing high school or entering a four year college by thirteen percentage points in bivariate probit models we find almost no evidence that our single equation estimates are subject to selection bias

expenditures and student achievement in illinois abstract this study examines educational outcomes in illinois for the 1989 1990 school year several measures of educational attainment are analyzed including act scores high school graduation rates and the percentage in a high school planning to attend college the most important results are that an increase in average teacher s salary increases act scores and the percentage college bound and an increase in the pupil teacher ratio reduces the graduation rate and the percentage college bound

commodity choice behavior with pigeons as subjects starting from an initial baseline budget line income compensated price changes always resulted in substitution effects consistent with the slutsky hicks theory this behavior cannot be explained by a simple random behavior model similar changes in relative prices that did not originate from the initial baseline budget line resulted in undersubstitution effects the composition of consumption changed in the expected direction but the magnitude of change was not large enough to be consistent with the initial commodity bundle chosen these undersubstitution effects are not explainable by shifting preference patterns or anchoring effects found in inconsistent choice sequences with human subjects