alternative value elicitation formats in contingent valuation mechanism design and convergent validity abstract to date much of the theoretical work on the incentive properties of contingent valuation surveys has focused on the oft recommended single binary choice sbc referendum format this work has identified conditions under which an sbc elicitation is incentive compatible and empirical evidence lends support to the predictive power of the theory nevertheless researchers and practitioners commonly use alternative elicitation formats and defend their design choices based on efficiency and other criteria in this study we demonstrate that it is possible to identify conditions under which alternative elicitation formats are incentive compatible using as examples open ended oe and payment card pc question formats we then implement theory informed value elicitations in the context of a flood control policy for new york city we fail to reject convergent validity in mean willingness to pay when comparing the theory driven oe format with sbc but reject convergent validity between the theory driven pc and sbc formats as an informative counterfactual we find that a standard oe elicitation congruent with prior work leads to significantly lower values and a lower proportion of respondents who view the elicitation as consequential

equilibrium unemployment with outsourcing and wage solidarity under labour market imperfections abstract we evaluate the effects of outsourcing and wage solidarity on wage formation and equilibrium unemployment in a heterogeneous labour market where wages are determined by a monopoly labour union we find that outsourcing promotes the wage dispersion between the high and low skilled workers when the labour union adopts a solidaristic wage policy it will dampen this tendency further higher outsourcing will increase equilibrium unemployment among the high skilled workers whereas it will reduce it among the low skilled workers overall outsourcing will reduce economy wide equilibrium unemployment under the reasonable condition that the proportion of high skilled workers is sufficiently low

optimal design for multinomial choice experiments abstract the author derives d optimal designs for main effects multinomial choice experiments using attribute levels as design parameters the design solutions are similar to standard main effects designs except that one attribute is used to manipulate response probabilities the manipulator is key to implementing optimal designs in practice

a simultaneous approach to the estimation of risk aversion and the subjective time discount rate in this paper we analyze a sample of 1832 individuals who responded to six randomly generated lottery questions that differ with respect to chance prize and the timing of the draw using a model that explicitly allows for consumption smoothing we obtain an estimate of relative risk aversion of 82 instead assuming consumption to be immediate gives an estimate of 2 close to what is traditionally reported while a model of full asset integration gives estimates higher by several orders of magnitude our results show that estimated risk aversion is sensitive to the assumptions made with respect to the consumption profile and that it is possible to determine the level of asset integration endogenously the average subjective time discount rate which includes a preference for the present equals 6 percent per month it is found that both parameters vary strongly over individuals and that the variation can be explained by income age gender and entrepreneurship consistent with the majority of previous evidence

are choice experiments incentive compatible a test with quality differentiated beef steaks this study compares hypothetical and nonhypothetical responses to choice experiment questions we test for hypothetical bias in a choice experiment involving beef ribeye steaks with differing quality attributes in general hypothetical responses predicted higher probabilities of purchasing beef steaks than nonhypothetical responses thus hypothetical choices overestimate total willingness to pay for beef steaks however marginal willingness to pay for a change in steak quality is in general not statistically different across hypothetical and actual payment settings

gasoline demand revisited an international meta analysis of elasticities meta analysis is used to determine if there are factors that systematically affect price and income elasticity estimates in studies of gasoline demand four econometric models are estimated using long run and short run price and income elasticity estimates from previous studies as the dependent variables explanatory variables include functional form lag structure time span national setting estimation technique and other features of the model structure elasticity estimates are found to be sensitive to the inclusion or exclusion of some measure of vehicle ownership static models appear to overestimate short run elasticities underestimate long run price elasticities but pick up the full long run income responsiveness there is variation in the elasticity of demand across countries especially in the short run and gasoline demand appears to be getting more price elastic and less income elastic over time

trade migration costs and asymmetric migration patterns increase in trade has an asymmetric impact on emigration by skill types for a developing country cost of migration is a dynamic function of the type of emigration and it determines a complementary relation between emigration of skilled workers and expansion of trade emigration of unskilled workers is a substitute however and these outcomes coexist with endogenously determined emigration rates that depend crucially on wage responses among the own skill types at the source additionally asymmetric emigration patterns increase wage inequality

what s to know about hypothetical bias in stated preference valuation studies abstract hypothetical bias arises in stated preference valuation studies when respondents report a willingness to pay wtp that exceeds what they actually pay using their own money in laboratory or field experiments although this bias is not found in all stated preference surveys hypothetical wtp typically exceeds the actual value by a factor of two to three unfortunately there is no widely accepted general theory of respondent behaviour that explains hypothetical bias therefore two meta analyses are reviewed to test current hypotheses regarding the causes of this overstatement of wtp and the associated recommendations to mitigate the bias suggestions for future research are made including the development of a general theory

agroindustrialization of the global agrifood economy bridging development economics and agribusiness research this paper examines the agroindustrialization process from two supposedly disparate views development economics and agribusiness research the evolution of conceptual and methodological approaches emanating from these fields is explored and general observations are made concerning farm economic interdependence institutional and organizational change differing scopes of interest the causes of agroindustrialization orientation and the choice of microanalytic tools terminology and unit of analysis despite an impressive list of hurdles disincentives and disconnects complementarities between the two fields are identified the paper concludes by exploring the potential of bridging development economics and agribusiness research to inform the future agroindustrialization research agenda

perceptions versus objective measures of environmental quality in combined revealed and stated preference models of environmental valuation abstract this study examines perceptions and objective attribute measures in discrete choice models of recreation site choice behavior these forms of attribute measurement are examined in individual and combined revealed preference stated preference models our results suggest that the model based on perceptions slightly outperforms the models based on objective attribute measures however issues such as the definition of the choice set and the measurement of welfare present significant challenges when using perceptions data

combining revealed and stated preference data to estimate the nonmarket value of ecological services an assessment of the state of the science this paper reviews the marketing transportation and environmental economics literature on the joint estimation of revealed preference rp and stated preference sp data the rp and sp approaches are first described with a focus on the strengths and weaknesses of each recognizing these strengths and weaknesses the potential gains from combining data are described a classification system for combined data that emphasizes the type of data combination and the econometric models used is proposed a methodological review of the literature is pursued based on this classification system examples from the environmental economics literature are highlighted a discussion of the advantages and disadvantages of each type of jointly estimated model is then presented suggestions for future research in particular opportunities for application of these models to environmental quality valuation are presented

an incentive compatible conjoint ranking mechanism a simple method for making ranking based conjoint analysis incentive compatible is proposed the incentive compatible mechanism involves people purchasing a product profile with a probability proportional to its assigned rank in an empirical application related to consumer preferences for beef attributes we find that the forecasted market share for a new pasture raised steak obtained using incentive compatible rankings was significantly greater than that implied from traditional hypothetical conjoint rankings people s rankings of ground beef products were not affected by the mechanism or by information about pasture raised beef copyright 2008 oxford university press

monetary valuation of insurance against flood risk under climate change climate change is projected to increase the risk of natural disasters such as floods and storms in certain regions this is likely to raise the demand for natural disaster insurance we present a stated preference survey using choice modeling with mixed logit estimation methods in order to examine the effects of climate change and the availability of government compensation on the demand for flood insurance by dutch homeowners currently no private insurance against flood damage is offered in the netherlands the results indicate that there are opportunities for the development of a flood insurance market 2012 by the economics department of the university of pennsylvania and the osaka university institute of social and economic research association

convergent validity of revealed and stated recreation behavior with quality change a comparison of multiple and single site demands we consider the convergent validity of several demand models using beach recreation data two models employ multiple site data a count data demand system model and the kuhn tucker demand system model we explore the role of existing variation in beach width in explaining trip choices and analyze a hypothetical 100 foot increase in beach width we compare these models to a single equation model where we jointly estimate revealed and stated preference trip data and focus on a hypothetical scenario considering a 100 foot increase in beach width in each case we develop estimates of the change in beach visits and the welfare impacts from the increase in width the trip change estimates from two of the three models are similar and convergent valid though the willingness to pay estimates differ in magnitude

outsourcing and the skilled unskilled wage gap abstract within the context of a product variety model this paper examines the impact of outsourcing of skill intensive tasks on the skilled unskilled wage gap outsourcing affects the wage gap through direct as well as indirect channels while outsourcing decreases the effective wage of skilled workers in the services sector owing to inter sectoral labour mobility its overall impact on the equilibrium skilled wage is positive through an increase in the size of external economies in the industrial sector outsourcing can reduce the unskilled wage in overall terms outsourcing of skill intensive tasks increases the skilled unskilled wage gap

service offshoring and productivity evidence from the us the practice of sourcing service inputs from overseas suppliers has been growing in response to new technologies that have made it possible to trade in some business and computing services that were previously considered non tradable this paper estimates the effects of offshoring on productivity in us manufacturing industries between 1992 and 2000 it finds that service offshoring has a significant positive effect on productivity in the united states accounting for around 10 per cent of labour productivity growth during this period offshoring material inputs also have a positive effect on productivity but the magnitude is smaller accounting for approximately 5 per cent of productivity growth

effect of distance of transportation on willingness to pay for food abstract consumers interest in locally produced foods is increasing hence there is a need to decipher and quantify consumers desire for local foods and understand the underlying causes of this demand more specifically we examine in this paper the issue of distance of transportation and its impact on consumer preferences we investigate how consumers willingness to pay wtp for food varies with the distance the food traveled results from non hypothetical second price auctions indicate that average wtp is falling in distance traveled indicating a preference for local production results also indicate that the marginal value of a mile traveled depends on the type of food studied apples vs wine socio demographic characteristics perceptions of freshness taste and food safety as well as support of local economy impact wtp for local foods

evaluation of the subjective probabilities of survival in the health and retirement study in the health and retirement study respondents were asked about the chances they would live to 75 or to 85 we analyze these responses to determine if they behave like probabilities of survival if their averages are close to average probabilities in the population and if they have correlations with other variables that are similar to correlations with actual mortality outcomes we find that generally they do behave like probabilities and that they do aggregate to population probabilities most remarkable however is that they covary with other variables in the same way actual outcomes vary with the variables for example respondents with higher socioeconomic status give higher probabilities of survival whereas respondents who smoke give lower probabilities we conclude that these measures of subjective probabilities have great potential use in models of intertemporal decision making under uncertainty

combining revealed and stated preference methods to value environmental amenities at residential locations this paper combines an established revealed preference method discrete choice he donic analysis and a relatively new stated refer ence method choice based conjoint analysis in order to estimate more accurately the aesthetic benefits generated by the presence and quality of environmental amenities associated with residen tial locations it applies the combined approach to the housing market of fairfield connecticut which contains several environmental amenities and is experiencing an improvement in the quality of its coastal wetlands due to active restoration efforts jel q26

measuring productive efficiency in multiple product agribusiness firms a dual approach measuring retail fertilizer plant efficiency is difficult given the range of outputs produced by these multiple product firms a frontier multiproduct cost function was employed to measure productive efficiency results suggest the average plant could lower variable costs by 10 through more effective operations allocative inefficiency was minimal indicating management should focus on improving technical efficiency the limitations of employing a single product model in a multiproduct situation are demonstrated

do hypothetical and actual marginal willingness to pay differ in choice experiments application to the valuation of the environment abstract in this paper we test the validity of choice experiments with donations for environmental projects in particular we test whether or not there are differences in preferences between a hypothetical and an actual choice experiment our experiments indicate no differences in addition internal tests of validity indicate transitive and stable preferences in both experiments although there are some indications of possible learning effects during the experiment

does vertical specialization increase productivity this paper investigates the impact of global value chain participation on productivity using data on trade in value added from the world input output database the results based on a panel estimation covering 13 sectors in 40 countries over 15 years suggest that participation in global value chains is a significant driver of labor productivity backward participation in global value chains that is the use of imported inputs to produce for exports emerges as particularly important an increase by 10 percent in the level of global value chain participation increased average productivity by close to 1 7 percent

viewscapes and flood hazard coastal housing market response to amenities and risk coastal amenities and risk are so highly correlated that separate identification within the hedonic framework is potentially challenging in this study we construct a three dimensional measure of ocean view viewscape accounting for natural topography and built obstruction that varies independent of risk classification to disentangle these spatially integrated housing characteristics a spatial autoregressive hedonic model is developed to provide consistent estimates of the willingness to pay for coastal amenities and risk our findings suggest that incorporating the gis based view measures can be successful in isolating risk factors from spatial amenities

broiler production contracts as a multi agent problem common risk incentives and heterogeneity the broiler industry presents two puzzles regarding production contracts why do processors control growers inputs and why do they use a statistically insufficient estimator to calculate growers compensation this paper provides an agency theoretic framework that explains these puzzles in terms of processors response to grower heterogeneity and production risk and to grower risk aversion processors control inputs to reduce the information rents paid to agents by forcing agents to bear additional income risk through the use of an imprecise estimator processors can increase profits due to the combined moral hazard adverse selection nature of the informational problem

the future of u s agricultural cooperatives a neo institutional approach thirty years ago helmberger speculated that industrialization of agriculture would lead to the demise of farmer cooperatives helmberger 1966 p 1434 in responding to helmberger s prediction abrahamsen countered by suggesting that as industrialization of agriculture evolved cooperatives would increasingly become the farmer s integrating agency abrahamsen p 1442 in this paper i examine these two divergent opinions by a briefly describing the structural and strategic evolution of u s farmer cooperatives since the helmberger and abrahamsen h a forecasts b utilizing recent developments in neo institutional economic organizational economic theory to generate hypotheses regarding structural and strategic shifts in u s agricultural cooperatives and c further applying neo institutional economics to speculate what the future might hold for u s producerowned and controlled agricultural cooperatives

changes in implicit flood risk premiums empirical evidence from the housing market abstract hedonic valuation models have shown that sales prices can capitalize property risk factors such as flood zone properties facing lower risk sell at a premium all else being equal previous research has indicated that price differentials reflecting risk of flooding become much larger in the wake of a storm we re examine these findings for pitt county north carolina using multiple storm events within a difference in differences framework and we compare flood zone price differentials for a more recent sample of property sales prior to hurricane fran in 1996 we detect no market risk premium for the presence in a flood zone but we find significant price differentials after major flooding events amounting to a 5 7 decrease after hurricane fran and 8 8 decrease after hurricane floyd results from a separate model that examines more recent data covering a period without significant storm related flood impacts indicate a significant risk premium ranging between 6 0 and 20 2 for homes sold in the flood zone but this effect is diminishing over time essentially disappearing about 5 or 6 years after hurricane floyd the lack of a persistent effect suggests that buyers and sellers risk perceptions may change with the prevalence of hazard events and that homebuyers are unaware of flood risks and insurance requirements when bidding on properties

convergence of the static estimation toward the long run effects of dynamic panel data models abstract this article focuses on the estimation of long run effects on panel data we show that the probability limit of the between estimator of a static relation whereas the true specification is a dynamic error components model converges to the long run effects

assessing the competitive interaction between private labels and national brands in this article we employ the linear approximate almost ideal demand system la aids and specify price reaction equations derived under the la aids specification we perform intracategory analyses using data on six individual categories as well as a pooled analysis on a sample of 125 categories and 59 geographic markets we find that consumer response to price and promotion decisions demand and firm pricing behavior supply jointly determine observed market prices and market shares further estimates of residual demand elasticities suggest that examination of partial demand elasticities alone may provide an incomplete picture of the ability of brands to raise price copyright 2000 by university of chicago press

the importance of taste in experimental auctions consumers valuation of calorie and sweetener labeling of soft drinks a majority of purchases that consumers make are classified as repeat purchases one of the main reasons why consumers make repeat food purchases is the food s taste therefore we examined the importance of including taste testing in nonhypothetical experimental auctions specifically we used two experiments to determine consumers willingness to pay for soft drinks labeled with different calorie and sweetener information in experiment 1 participants tasted the soft drinks prior to the bidding rounds in experiment 2 participants did not taste the soft drinks prior to the bidding rounds bidding behavior for the soft drinks was significantly different between experiment 1 and experiment 2 results suggest that including taste testing in the design of experimental auctions is important to accurately capture consumers willingness to pay for foods that are purchased repeatedly results also imply that policies aimed at combating obesity by making the calorie content of foods more visible may not produce desired outcomes

demand for farm output in a complete system of demand functions demand interrelationships for farm outputs that are theoretically consistent with consumer demand and marketing group behavior provide important linkages between retail and farm prices a conceptual model based on reduced form specifications for retail and farm prices is formulated and applied empirically to a set of eight disaggregated food commodities this approach circumvents the need for retail quantities which are frequently unavailable for disaggregated food commodities the results are consistent with theory and generally indicate significant substitution between farm and marketing inputs except for poultry derived demand elasticities are at least 40 larger compared to those derived assuming fixed proportions

the deadweight loss of christmas when economists comment on holiday gift giving it is usually to condone the healthy effect of spending on the macroeconomy however an important feature of gift giving is that consumption choices are made by someone other than the final consumer a potentially important microeconomic aspect of gift giving is that gifts may be mismatched with the recipients preferences in the standard microeconomic framework of consumer choice the best a gift giver can do with say 10 is to duplicate the choice that the recipient would have made while it is possible for a giver to choose a gift which the recipient ultimately values above its price for example if the recipient is not perfectly informed it is more likely that the gift will leave the recipient worse off than if she had made her own consumption choice with an equal amount of cash in short gift giving is a potential source of deadweight loss this paper gives estimates of the deadweight loss of holiday gift giving based on surveys given to yale undergraduates i find that holiday gift giving destroys between 10 percent and a third of the value of gifts while these recipients may be unrepresentative of the u s population their gifts are not necessarily unrepresentative holiday expenditures average 40 billion per year implying that a conservative estimate of the deadweight loss of christmas is a tenth as large as estimates of the deadweight loss of income taxation i also explore how deadweight loss and the tendency to give cash gifts vary with the relationship and age difference between giver and recipient i find that gifts from friends and significant others are most efficient while noncash gifts from members of the extended family are least efficient and destroy a third of their value i develop a simple expected utility model to explain the decision to give cash as opposed to in kind gifts the data are consistent with the model cash gifts are most common from the sorts of givers whose noncash gifts have the lowest expected value to recipients given their cost and high variability in recipient valuation

agricultural markets as relative performance evaluation relative performance schemes such as tournaments are commonly used in markets for a variety of livestock and processing commodities while explicit versions of these schemes are rarely used in markets for fresh fruits and vegetables and specialty grains we show how contracts for these latter commodities do in fact provide relative performance incentives albeit indirectly via a payment mechanism that depends on market prices in such contracts compensation is often an increasing function of revenue this implements a relative performance scheme by making each grower s payment an increasing function of his own output but a decreasing function of other s output in an important 1982 article holmstr om models the problem facing a group of agents each of whom produces an observable quantity of some good by taking an unobservable action a rather robust conclusion from this line of inquiry is that when the production of one agent is not independent of the production of another then the compensation awarded to the first agent should depend not only on his own production but also on the output of others in particular if agents production is positively correlated because of some common shock for example then an agent s compensation should be larger when other agents output is smaller a phenomenon which holmstr om terms relative performance evaluation relative performance evaluation ought to be particularly important for agricultural producers and the various intermediaries who purchase their output these producers face considerable common risk from aggregate production shocks and so one would expect that relative performance evaluation could improve efficiency in fact certain types of agricultural intermediaries do use explicit relative performance schemes as predicted by

bounded rationality climate risks and insurance is there a market for natural disasters this paper examines the role of insurances to reduce uncertainty associated with climate change losses for individuals of special interest is the value individuals place on the reduction of increased flood risks by insurance coverage using rank dependent utility and prospect theories risk premiums are estimated under different climate change scenarios for the netherlands the study delivers two main insights first estimation results suggest that a profitable flood insurance market could be feasible second climate change has the potential to increase the profitability of offering flood insurance 2009 by the board of regents of the university of wisconsin system

an experimental validation of hypothetical wtp for a recyclable product using a within subject experiment we compare hypothetical andreal willingness to pay wtp for an improvement in therecyclability of a product subjects are faced with a real paymentscenario after they have responded to a hypothetical question contrary to most of the results obtained in similar studies at apopulation level there are no significant median differencesbetween actual and hypothetical stated values of wtp however within subject comparisons between hypothetical and actual valuesindicate that subjects stating a low high hypothetical wtp tendto underestimate overestimate the value of their actualcontributions

assessing the consumers willingness to adopt a prepayment metering system in nigeria abstract despite the rising popularity in the adoption and usage of prepayment meters little is still known about the drivers of its adoption we examine the willingness to adopt prepayment metering ppm for a sample of nigerian households that were not prepayment users double hurdle models were estimated to account for households decisions concerning billing system switching behaviour and households willingness to pay wtp the estimated results revealed that decisions to adopt a prepayment meter are significantly affected by current electricity spending current billing method and the split incentive problem whereas current electricity spending significantly increased the tendency to adopt ppm the split incentive problem reduced the probability of adoption although unmetered consumers were more likely to express a willingness to adopt a ppm system than post paid customers they did not intend to pay a significantly higher amount to obtain the prepayment service income did not play a significant role in decision making concerning ppm adoption and the corresponding wtp amount these results cast doubt on the validity of the widely held belief that low income may be responsible for ppm adoption reflecting the widespread usage of ppm by low income households

the disparity between willingness to accept and willingness to pay measures of value psychologists have long argued that people are much more averse to a loss than attracted to an equivalent gain this behavior termed loss aversion has been formalized by kahneman and tversky 1979 in their reformulation of expected utility theory prospect theory in prospect theory the utility function is replaced by a value function that evaluates changes in income from the current level increases in income are weighted by a relatively small marginal utility decreases in income are weighted by a much larger marginal utility in effect the value function implies that a kink in the relationship between utility and income occurs at the initial income or reference point and that the slope of the utility function for losses in income is steeper than it is for gains in a recent paper knetsch and sinden 1984 report a series of experiments that demonstrate the existence of a large disparity between willingness to accept wta and willingness to pay wtp measures of value they argue that the psychological theory of loss aversion explains this difference economic theory would suggest that individuals who exhibit a large disparity between wta and wtp are perhaps underperceiving the value of gains or overperceiving the value of losses are behaving in an irrational manner and will consequently achieve a lower level of well being than if they behaved in a true utility maximizing manner this would in contrast to loss aversion usually imply near equal values for wta and wtp see willig 1976 further documentation of a larger than expected disparity between wta and wtp has been obtained in surveys asking for the value of a variety of public goods for example cummings brookshire and schulze 1986 document six

the causes of order effects in contingent valuation surveys an experimental investigation contingent valuation researchers have found that the hypothetical values respondents place on a nested sequence of environmental goods are sensitive to the order in which the goods are presented typically the smallest bundle of goods is valued more highly if presented first than if following more comprehensive bundles such effects appear even when each bundle is valued from an exclusive list or as an alternative to any other so that income and substitution effects are controlled we conduct lab experiments where participants are asked to value sequences of nested goods for purchase from an exclusive list using an incentive compatible becker degroot marschak mechanism we test whether order effects occur in valuation for a induced value goods b actual private goods and c identical private goods that are to be donated to charities we find significant order effects when the goods are valued for own use but not when they are valued for donation

uncertainty of governmental relief and the crowding out of flood insurance this paper discusses the problem of crowding out of insurance by co existing governmental relief programs the so called charity hazard in the context of different institutional schemes of governmental disaster relief in austria and germany we test empirically whether an assured partial relief scheme as in austria drives a stronger crowding out of private insurance than a scheme promising full relief which is subject to ad hoc political decision making as in germany our general finding is that the institutional design of governmental relief programs significantly affects the demand for private natural hazard insurance

an inferred valuation method although estimates of people s values for public goods are often needed to conduct cost benefit analysis existing value elicitation methods are prone to a number of well documented biases we argue that some of these biases result because people derive utility from the act of saying they are willing to pay for a good to counteract this phenomenon we consider an approach that asks people to predict or infer others values for a good instead of asking people to state their own value both a conceptual model and results from a laboratory experiment lend support for the new approach

are consumers in developing countries willing to pay more for micronutrient dense biofortified foods evidence from a field experiment in uganda vitamin a deficiency is a major health problem in africa and in many other developing countries biofortified staple crops that are high in pro vitamin a have the potential to reduce the prevalence of vitamin a deficiency using a choice experiment with the real product in uganda we quantify the magnitude of the premium or discount in consumers willingness to pay wtp that may be associated with it results suggest that taste plays an important role in consumer acceptance and the provision of nutrition information does translate into substantial premiums for the biofortified variety there is a substantial hypothetical bias in the wtp for the new varieties and while cheap talk mitigates this bias it does not eliminate it

reliability and predictive validity of contingent values does the nature of the good matter abstract because the contingent valuation mechanism cvm elicits verbal reports of maximum willingness to pay and not actual willingness to pay analysts have expressed doubts about the reliability and validity of contingent values for commodities such as environmental amenities this skepticism is usually attributed to the amorphous nature of the commodity and to peoples lack of familiarity or experience however our comparison of two commodities which lie at polar extremes of the private good public good continuum suggests that the nature of the good may have little influence on the reliability and predictive validity of the cvm instead aspects of the cvm itself e g explicit payment obligation may be more important for high intention behavior consistency

global value chain participation and current account imbalances abstract this paper draws a causal link between increased levels of global value chain participation gvcp and increases in a country s current account we document empirically that stronger gvcp is associated with larger current account balances according to our estimates cross country differences in gvcp reduce the hitherto unexplained part of current account imbalances substantially for some countries for example for the united states and japan the unexplained part of the current account falls by 75 and 50 over the sample period when controlling for their gvcp relative to the rest of the world for germany the unexplained part of the current account deficit falls by an average of 10

risky sports and the value of safety information abstract we develop a theoretical account of how athletes engaged in risky sports value safety information based on our model we postulate that the demand value of such information rises with wealth and exposure and declines with the athlete s appetite for risk we use survey data from a sample of backcountry skiers to empirically test these predictions the high degree of self control over exposure makes these athletes a well suited population to study the demand value of safety information caution is warranted in the empirical analysis as unobserved factors may jointly affect the athlete s perceived risk and his willingness to pay for obtaining safety information we use a recursive two stage estimation approach to account for endogeneity concerns the empirical results are supportive of our theoretical predictions and suggest that variations in athletes demand for safety information can be explained by personal beliefs about risk exposure and deliberate risk taking

what experimental protocol influence disparities between actual and hypothetical stated values preferences elicited in hypothetical settings have recently come underscrutiny causing estimates from the contingent valuation method to bechallenged due to perceived hypothetical bias given that the receivedliterature derives value estimates using heterogeneous experimentaltechniques understanding the effects of important design parameters onthe magnitude of hypothetical bias is invaluable in this paper we addressthis issue statistically by using a meta analysis to examine data from 29experimental studies our empirical findings suggest that on averagesubjects overstate their preferences by a factor of about 3 in hypotheticalsettings and that the degree of over revelation is influenced by thedistinction between willingness to pay and willingness to accept publicversus private goods and several elicitation methods

international outsourcing and the productivity of low skilled labor in the eu this article presents first insights into the role of international outsourcing on the productivity of low skilled workers in eu manufacturing whereas in the short run international outsourcing exhibits a negative marginal effect on real value added per low skilled worker the long run parameter estimates reveal a positive impact this may be explained by imperfections in european labor and goods markets which prohibit an immediate adjustment in the factor employment and the output structure the change in the outsourcing intensity since 1993 alone acounts for a long run increase of about 6 0 in the real value added per low skilled worker jel c33 f14 f15

outsourcing labour productivity and wage inequality in the us a primal approach we investigate the linkages among outsourcing activities labour productivity and wage inequality for skilled and unskilled labour by employing a primal approach that involves estimating a nested constant elasticity of substitution production function using six digit north american industry classification system us manufacturing industries from 2002 to 2005 first we find that general outsourcing and international outsourcing have a skill biased impact on labour productivity however the skill biased impact of general outsourcing on labour productivity is larger than that of international outsourcing second we find that the wage gap between skilled and unskilled labour which is defined as their marginal productivity gap can be better explained by general outsourcing than by international outsourcing these two results imply that the wage inequality of us manufacturing industries during 2002 2005 was mainly due to the skill biased labour productivity effect of general outsourcing rather than that of

regular flexibility of nested ces functions in this paper we define the class of regular flexible functional forms as the class of cost functions which are globally well behaved and can provide a local approximation to any globally well behaved cost function we then offer a constructive proof of flexibility for the nonseparable n stage constant elasticity of substitution functional form nnces by describing a technique through which the nnces form can be parameterized so as to locally capture any regular configuration of input demands and second order curvature conditions

mitigating hypothetical bias in stated preference data evidence from sports tourism one of the major criticisms of stated preference data is hypothetical bias using a unique dataset of both stated and actual behavior we test for hypothetical bias of stated preference survey responses we consider whether respondents tend to overstate their participatory sporting event behavior ex ante when compared to their actual behavior at different registration fees we find that stated behavior accurately predicts actual behavior at a middle level of respondent certainty overpredicts actual behavior at a lower level of certainty and underpredicts behavior at a higher level of certainty this result suggests that respondent uncertainty corrections can be used to mitigate hypothetical bias and stated preference data can be used to better understand actual behavior in situations where no data exist jel l83 q51 z2

contingent valuation a new perspective after several decades of academic research on the contingent valuation cv method a consistent behavioral explanation of hypothetical bias is still lacking based on evidence from economics economic psychology and the political sciences i propose an explanation that is based on two simple working hypotheses about respondent behaviour in contingent valuation surveys the first hypothesis is that survey respondents are unable to form consistent preferences about unfamiliar goods unless the choice context offers reliable informative cues that can be rationally exploited in simplified heuristics the second hypothesis is that the probability and impact of strategic responses in dichotomous choice questions about public goods depends on the extent to which the presented hypothetical costs differ from the actual costs the literature on hypothetical bias is revisited in the light of these behavioral hypotheses i find that the hypotheses are generally supported by the empirical data moreover the hypotheses are able to explain several important empirical phenomena that previous research has not been able to explain in particular they solve the puzzle that pre election polls but not cv surveys are able to predict actual referendum outcomes and they explain why income effects on willingness to pay are lower in cv responses than in actual votes if confirmed by further studies the hypotheses will have important implications for future research and practice first the hypothetical costs presented in the dichotomous choice question should to be close enough to the actual costs to be credible to all respondents this can be achieved by specifying the costs as a percentage rather than absolute change in taxes second the respondents should be given the option to answer based on information about the positions of large parties and interest groups with known political orientation rather than based on the raw policy information theory and evidence suggest that this new survey paradigm largely eliminates the fundamental problems of the conventional stated preference methods

convergent validity of attribute based choice questions in stated preference studies the application of attribute based choice questions is well established in the marketing literature but there are unique aspects of the design that warrant investigation to assess their validity for economic welfare estimation three design issues are investigated in this paper 1 the placement of the monetary stimulus policy cost to respondents in the sequence of attributes 2 the number of policy alternatives respondents are asked to consider in choice questions two versus three and 3 the inclusion versus exclusion of a status quo alternative in choice questions the data used to implement these investigations are from a survey designed to estimate the value maine residents place on a farmland conservation easement program tests of convergent validity indicate that the placement of the monetary stimulus first versus last in the list of attributes did not affect estimates of preference parameters significant differences between questions with three versus two alternatives did occur and the inclusion exclusion of a status quo alternative did not affect preference parameters

bridging the gap between revealed and stated preferences in flood prone housing markets abstract this papers attempts to shed light on the gap between revealed and stated preferences methods in flood prone housing markets we quantitatively explore the market level consequences of various behavioural models assumptions regarding risky choices at the individual level in addition we quantify the effect of the market level bias in risk valuation that individual preferences for neighbourhood quality imply we apply an economic agent based housing market model to quantify and disentangle the impacts of behavioural biases in individual decisions under risk as well as neighbourhood externalities which both are known to distort markets we compare three different micro level behavioural risk models expected utility prospect theory and risk negligence the flood risk discount on a market level varies significantly but the results do not rule out any of these models in general markets with prospect theory traders overprice risks causing an unrealistically high price differential between risk prone and risk free properties the marginal implicit price for flood risk is much closer to empirically found prices in the expected utility and risk negligence models additionally we find that individual preferences for neighbourhood quality and multicollinearity in housing attributes can cause a bias in market level risk valuations of up to 9 7 of a property s value

can consumers willingness to pay incentivize adoption of environmental impact reducing technologies in meat animal production abstract this study develops a model estimating consumer willingness to pay wtp for environmental meat attributes and uses a multi objective nutritional optimizer to explore the extent to which wtp can offset on farm costs of reducing water use data for the wtp model are sourced from a literature survey of the agricola and google scholar databases yielding 46 studies estimating wtp for pure and impure organic grass fed natural environmental meat attributes bayesian analysis is used to estimate 3 models varying in independent variables models are evaluated by the correlation coefficient r2 root mean squared error of prediction rmspe and posterior model probability the most probable model is then used to estimate a confidence range of wtp for pure environmental beef impure environmental labels result in higher wtp than pure labels non hypothetical wtp for pure environmental labeling for north american consumers ranges from 6 7 to 32 6 a case study is conducted to identify the expected reduction in water use that can be funded from capturing wtp through labeling a multi objective nutritional optimizer is used to identify ideal management of beef cattle to reduce whole system water use in three regions of the united states cost increases from management are varied over the predicted range in wtp and combined with the probability of a consumer purchasing beef at each wtp value to identify the theoretical effect on expected environmental impact reduction a 10 premium is the ideal wtp resulting in water use reductions between 24 4 l and 41 4 l

stated versus revealed knowledge determinants of offsetting co2 emissions from fuel consumption in vehicle use abstract this paper examines the role of prior knowledge in offsetting co2 emissions from fuel consumption in vehicle use the main result of our econometric analysis on the basis of unique representative data from drivers license holders in the usa and germany refers to the strong discrepancy between the stated and revealed knowledge of co2 offsetting the revealed knowledge measured by the correct estimation of the costs for this offsetting practice has a positive impact on the stated purchase of corresponding offsetting credits in both countries in contrast the effect of the stated knowledge of offsetting is not robust and in some cases even negative surprisingly it cannot even be confirmed that drivers license holders who claim that they are more than sufficiently informed estimate these costs more accurately

does federal disaster assistance crowd out flood insurance abstract we empirically analyze whether federal disaster aid crowds out household purchase of disaster insurance we combine data on annual household flood insurance purchases for the united states over the period 2000 2011 with data from the two main u s post disaster federal aid programs fema s individual assistance grants and sba s low interest disaster loans estimating both fixed effects and instrumental variable models to account for the endogeneity of disaster assistance grants we find that receiving individual assistance grants decreases the average quantity of insurance purchased the following year by between 4000 and 5000 the reduction we find is roughly 3 of the mean insurance coverage in the sample but larger than the average flood related ia grant in our sample which is 2984 ia is currently limited and larger grants could have different impacts the crowding out is on the intensive margin we find no impact on take up rates likely because there is a requirement that recipients of disaster aid purchase an insurance policy we do not know how take up rates might change without such a requirement low interest post disaster government loans have no systematic effect on insurance purchases

using neuroeconomics to understand environmental valuation contingent valuation choice experiments and other stated preference methods are frequently used to capture the nonmarket valuation of natural resources and ecosystem services the emerging field of neuroeconomics which assesses the neuroscience underlying decision making plots a promising course to explore the mechanisms underlying complex environmental valuation decisions neuroeconomic methods offer a unique capacity to isolate value components that contribute to willingness to pay wtp separating an individual s response to natural resource attributes that are of interest to economists from other attributes or influences on the decision process neuroimaging data can also aid in understanding differences in response between preference elicitation techniques and identifying the use of different decision processes and heuristics during valuation this article surveys the benefits and limitations of using neuroeconomics methods to assess the value of environmental goods and focuses on three examples where neuroeconomics may inform environmental valuation protest responses comparison of hypothetical and consequential choice contexts and the evaluation of environmental attributes and optimization of study design in stated choice experiments neuroeconomics methods offer a foundation for positive collaboration between environmental economists and cognitive neuroscientists yielding metrics that complement and augment current stated preference methods of determining environmental valuation

evaluating the validity of the dichotomous choice question format in contingent valuation hypothetical and actual cash willingness to pay wtp for an art print were elicited with dichotomous choice and open ended question formats comparing hypothetical and actual dichotomous choice responses using both a likelihood ratio test and the method of convolutions suggests we reject equality at the 0 05 but not the 0 01 level hypothetical wtp was roughly two times actual wtp with the dichotomous choice format there were no significant differences between the open ended and dichotomous choice question formats when both were used to estimate hypothetical wtp or both used to estimate actual wtp

innovation and wage effects of international outsourcing abstract we investigate the effects of increased outsourcing of production to a low wage country such international outsourcing lowers the marginal cost of production and thus increases profits creating greater incentives for innovation a reduction in the resource requirement in adapting technology relative to improving products or an expansion in the portion of production that can be outsourced generates a greater extent of international outsourcing a lower relative wage and a faster rate of innovation an increase in production taxes in the north production subsidies in the south or a subsidy to adapting technologies has similar effects

dynamic hypothetical bias in discrete choice experiments evidence from measuring the impact of corporate social responsibility on consumers demand abstract this paper is aimed at studying the dynamics of consumers preferences for corporate social responsibility the data come from both a discrete choice experiment dce and a field experiment conducted in a real market setting the results show that in a static setting first month predictions of a standard dce study and real market shares are statistically similar for the various profiles of corporate social responsibility however as time evolves real market shares present some dynamic patterns that are not mirrored by the standard dce predictions the overall conclusion is that differences between real market behavior and dce data can be attributed to the lack of learning experience or adaptation in dce surveys rather than to the hypothetical nature of the experiments

ownership structure in agrifood chains the marketing cooperative globalization technological developments and consumer concerns press farmers and food producers to enhance product innovation and to seek more efficient production and distribution structures these changes in agrifood markets shift the relative importance of the investments by different chain partners it may therefore be necessary to change the allocation of ownership of essential assets to induce agents to make those investments that generate the chain optimum this article analyzes the impact of ownership structure on investments in a three tier supply chain from an incomplete contracting perspective circumstances are determined in which a marketing cooperative is the unique first best ownership structure

measuring the environmental cost of hypocrisy this paper provides an example of how to estimate the marginal environmental cost of hypocrisy using revealed behavior and self identification survey responses from coffee drinkers regarding their use of cardboard and plastic i e non reusable cups coffee shops provide a convenient microcosm for assessing the impact of hypocritical behavior because of 1 readily available cheap substitutes i e reusable coffee cups 2 a relatively accurate estimate of the environmental in particular carbon cost associated with using non reusable cups and 3 the ability to delineate hypocritical behavior by observing a choice with relatively few potential confounding factors hypocritical behavior is measured as a geometric mean of how often an individual takes coffee in a non reusable cup and the degree to which the individual self identifies as being concerned about his environmental footprint all else equal the more often a person takes his coffee in a non reusable cup and the greater the degree to which he self identifies as being concerned about his footprint the greater the individual s hypocrisy score controlling for other attitudinal and demographic characteristics including self identified awareness of environmental issues and willingness to pay for the convenience of using a non reusable cup we are able to determine the marginal effect of an individual s hypocrisy score on the environmental cost associated with the use of non reusable coffee cups

should reference alternatives in pivot design sc surveys be treated differently analysts are increasingly making use of pivot style stated choice sc data in the estimation of choice models these datasets often contain a reference alternative whose attributes remain invariant across replications for the same respondent this paper presents evidence to suggest that respondents react differently to the attributes of these reference alternatives and those of purely hypothetical alternatives while some such evidence has been reported in the existing literature this paper goes further and details a number of different departures from a common treatment of the two types of alternatives relating both to the observed part of utility and the error term

fragmentation and multinational production abstract this paper examines the consequences of falling transport costs for intermediate goods and shows how this leads to the spatial fragmentation of production as firms divide their production between countries they become either vertical multinationals if upstream activities are labour intensive or horizontal multinationals if downstream activities are labour intensive in the former case the volume of world trade increases and in the latter it falls fragmentation need not narrow international factor price differences which depend on the factor intensity of the activities that relocate

wind insurance and mitigation in the coastal zone this paper presents the only study analyzing the decision to purchase wind coverage for individuals whose standard homeowner s policy excludes wind and one of very few analyses of the decision to undertake wind mitigation measures because these two decisions are closely related a simultaneous mixed process approach is used that allows for correlated disturbances across probit insurance and tobit mitigation equations results indicate a positive correlation between errors of the insurance and mitigation models conditioning on covariates households that hold wind insurance tend to engage in greater levels of wind mitigation

is unemployment lower if unions bargain over employment would there be more employment if unions bargained over employment and not only over wages most economists seem to answer yes 1

employment protection legislation and firm growth evidence from a natural experiment a swedish reform in 2001 made it possible for firms with less than 11 employees to exclude two from the last in first out principle in case of layoffs the reform increased employment growth with o

understanding the consequences of consequentiality testing the validity of stated preferences in the field this study pursues the external validation of stated preference methods by comparing survey responses from verified voters with the outcome of a parallel public referendum on a conservation and preservation program to be funded by a local property tax surcharge the majority of respondents were unaware of the upcoming referendum and the experimental design allows us to control for referenda related information effects as well as respondents perceptions regarding the consequentiality i e the potential policy impact of their survey votes we find the survey under predicts yes referendum votes at the precinct level these differences go away however if we focus only on respondents who perceived their survey vote to be consequential negative hypothetical bias among inconsequential survey respondents is also evident in the estimation of willingness to pay and controlling for consequentiality increases construct validity

trade with low wage economies employment and productivity in uk manufacturing the pattern of uk employment has been significantly transformed over the last two decades strengthening the services base of the economy but in the process imposing significant adjustment pressures on many groups in the labour force the manufacturing sector has experienced large scale job losses of the 7 26 million jobs in the sector in 1979 some 2 8 million or 40 had disappeared by 1992 the impact on some regions and groups of workers has been severe unskilled workers especially found it difficult to obtain re employment and their relative earnings have declined during this period unemployment levels increased rapidly peaking at 3 1 million in 1983 but remaining at over 2 million for much of the subsequent period these developments have been driven by a number of factors both national and internationial technological advance and institutional change have certainly been major factors a key concern addressed in this paper has also been the role played by the rapid growth of import competition from low wage economies to the extent that low wage competition shifts uk consumption from domestically manufactured to imported goods jobs in uk manufacturing will be lost whilst this should eventually lead to a redeployment and more productive use of uk labour it generates at least transitional unemployment moreover the displacement effect will have knock on multiplier effects on upstream industries that supply intermediate products and on business services which are used by the import competing industry greenhalgh 1994 employment in import competing sectors could further be affected as uk firms seek to defend their market position by improving x efficiency and speeding up technological innovation the consequent productivity gains while making jobs more secure in the longer term might generate additional job losses in the short term by enabling firms to maintain output with fewer workers the adjustment costs associated with these changes will depend on the flexibility of labour markets of course adjustment and change are normal features of a modern market economy and there are offsetting general equilibrium effects but there could still be concern that the scale and speed of rising competition from developing countries imposes excessive short term adjustment costs on owners of resources in uk manufacturing or at least that this might provoke a protectionist backlash thatjeopardises progress towards a more open uk economy

residential income segregation a behavioral model of the housing market abstract we represent the functioning of the housing market and study the relation between income segregation income inequality and house prices by introducing a spatial agent based model abm differently from traditional models in urban economics we explicitly specify the behavior of buyers and sellers and the price formation mechanism buyers who differ by income select among heterogeneous neighborhoods using a probabilistic model of residential choice sellers employ an aspiration level heuristic to set their reservation offer price prices are determined through a continuous double auction we first provide an approximate analytical solution of the abm shedding light on the structure of the model and on the effect of the parameters we then simulate the abm and find that i a more unequal income distribution lowers the prices globally but implies stronger segregation ii a spike in demand in one part of the city increases the prices all over the city iii subsidies are more efficient than taxes in fostering social mixing

agribusiness economics and management agribusiness scholarship emphasizes an integrated view of the food system that extends from research and input supply through production processing and distribution to retail outlets and the consumer this article traces development of agribusiness scholarship over the past century by describing nine

imperfect competition in agricultural markets and the role of cooperatives a spatial analysis important characteristics of many agricultural markets are costly to transport raw products and relatively few processors one or more of which is often a cooperative this paper analyzes pricing behavior in these oligopsonistic spatial markets and focuses specifically upon the conjecture that cooperatives may have a procompetitive effect on the behavior of rival non co op processors the existence and magnitude of a procompetitive effect is shown to depend upon a number of structural and strategic factors including competitive relations among the non co op processors and a cooperative s membership and pricing policies

reference dependence effects on wta and wtp value functions and their disparity in this study we investigate two reference dependence effects in a choice experiment the first is the effect of the well known distinction between gains and losses the second is the effect of changing the reference value on willingness to pay wtp and willingness to accept wta the latter has to our knowledge not been studied before we hypothesize that there are differences between wta and wtp and that both value functions and their disparity are affected by the absolute value of the reference point we test our hypotheses using a choice experiment with trade offs between changes in flood probabilities and costs the choice experiments elicit wtp and wta using two flood probability reference values yielding four separate value functions our findings show that a substantial wta wtp disparity exists and that this disparity increases when moving away from the reference point also both wta and wtp value functions are affected by the flood probability reference value and the wta wtp disparity increases when the flood probability reference point increases both findings suggest that welfare effects caused by changes in public good provision depend not only on the direction of change loss aversion but also the reference value moreover our results show that the latter effect is larger for losses than for gains we introduce the concept of reference point updating as a possible explanation for these findings

the truth the whole truth and nothing but the truth a multiple country test of an oath script hypothetical bias is one of the main issues bedeviling the field of nonmarket valuation the general criticism is that survey responses reflect how people would like to behave rather than how they actually behave in our study of climate change and carbon emissions reductions based on the increasing bulk of evidence from psychology and economics regarding the effects of making promises we investigate the effect of an oath script in a contingent valuation survey the survey was conducted in sweden and china and its results indicate that an oath script has significant effects on respondent behavior in answering willingness to pay wtp questions in both countries the shares of zero wtp responses and extremely high wtp responses decrease when an oath script is used resulting in lower variance furthermore the conditional wtp decreases in the chinese but not in the swedish sample we also find that the effect of the oath script is not generally dependent on respondent characteristics and the few differences we observe vary with the countries

are we willing to pay enough to back the bid valuing the intangible impacts of london s bid to host the 2012 summer olympic games using a contingent valuation survey this paper provides the first empirical test of the proposition that intangible impacts might justify hosting major sporting events on cost benefit grounds respondents drawn from london manchester and glasgow were asked for their willingness to pay wtp to host the 2012 olympic games in london on the basis of the intangible impacts that this event might provide annual mean wtp is 22 12 and 11 per year for 10 years in these 3 uk cities respectively an illustrative total uk wtp for intangible impacts is in the region of 2 billion statistical analysis of wtp determinants reveals a range of plausible explanatory factors such as respondents degree of support for the bid

revealed and stated preferences for co2 emissions reduction the missing link abstract in this paper we combine data collected from two strands of literature dealing with revealed preferences expressed by conventional vehicle drivers for fuel price variation and stated preferences expressed by consumers for alternative fuel vehicles we employ a meta analysis approach drawing data on 30 primary studies reflecting two important policy interventions which are fuel price taxation and subsidies for alternative fuel vehicles this is a new contribution in environmental and energy economics in that we rescale all primary information into a unique index which captures consumers economic attitude towards carbon dioxide co2 emission reduction in monetary terms focusing on the transport sector we compute the implicit price for the avoidance of a kilogram of co2 emissions named pco2 explaining the existing heterogeneity from several points of view the results of the meta analysis show that contextual and individual characteristics influence the implicit price for co2 emissions avoidance this implicit price is on average positive in the case of revealed preferences studies whereas it is negative in the stated preferences studies although there are some important geographical differences our results show that fuel taxes could be an important additional instrument for environmental policy

aid catastrophes and the samaritan s dilemma this paper discusses the impact of foreign aid on the recipient country s preparedness against natural disasters the theoretical model shows that foreign aid can have two opposing eects on a country s level of mitigating activities in order to test the theoretical propositions we analyse the eect of foreign aid dependence on ex ante riskmanagement activity proxied by the death toll from major storms floods and earthquakes occurring worldwide between 1980 and 2002 we find evidence that the crowding out eect of foreign aid outweighs the preventive eect in the case of storms while there is mixed evidence in the case of floods and earthquakes

market failure in information the national flood insurance program the national flood insurance program nfip was established in 1968 and requires mandatory flood insurance for property owners who have federally backed mortgages krutilla 1966 noted that a compulsory national flood insurance program could greatly improve the economic efficiency of flood plain occupancy in the united states however in order to realize the efficiency gains suggested by krutilla property owners must have sufficient information about flood risk and insurance premiums to make well informed home purchase decisions using survey data from boulder colorado we find significant evidence of market failure in information in the nfip program the majority of survey respondents all of whom live in a special flood hazard area report they did not fully understand the degree of flood risk or the cost of insuring against this risk when negotiating the purchase of their property

flooding risk and housing values an economic assessment of environmental hazard abstract climate change the boom and bust cycles of rivers and altered water resource management practice have caused significant changes in the spatial distribution of the risk of flooding hedonic pricing studies predominantly for the us have assessed the spatial incidence of risk and the associated implicit price of flood risk using these implicit price estimates and their associated standard errors we perform a meta analysis and find that an increase in the probability of flood risk of 0 01 in a year is associated to a difference in transaction price of an otherwise similar house of 0 6 the actual occurrence of a flooding event or increased stringency in disclosure rules causes ex ante prices to differ from ex post prices but these effects are small the marginal willingness to pay for reduced risk exposure has increased over time and it is slightly lower for areas with a higher per capita income we show that obfuscating amenity effects and risk exposure associated with proximity to water causes systematic bias in the implicit price of flood risk

frictional unemployment with stochastic bubbles abstract we show that the volatility puzzle in labor economics shimer 2005 stems from the inability of technology shocks to generate sufficient volatility of firm value we introduce non fundamental shocks to firm value akin to bubbles into an otherwise standard search and matching model when calibrated to stock market data stochastic bubbles significantly improve the ability of the matching model to quantitatively explain the volatility of the us labor market an extension with multiple sectors improves the persistence of simulated labor market variables