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

efficient methods of measuring welfare change and compensated income in terms of ordinary demand functions a utility maximizing consumer with a completely known system of ordinary demand functions q h p c is considered let p qo and p q be two arbitrary equilibrium situations the problem is to evaluate in which of the situations the utility is higher without knowing the utility function revealed preference theory tells that the ordinary demand functions which are in principle observable contain enough information to solve the problem remaining difficulties are therefore mainly computational we present how the compensated income c i c p qo and the compensated demand h p cl1 are calculated with arbitrary accuracy using only the ordinary demand system our two efficient algorithms also have interesting interpretations in terms of index numbers and consumer surplus measures

a hedonic travel cost analysis for valuation of multiple components of site quality the recreation value of forest management abstract one benefit of managing forests is that one can alter the qualities of sites the value of changing site qualities however is generally not known this paper develops a formal hedonic travel cost model which can be used to estimate the value of both marginal and non marginal changes to sites the approach accommodates multiple simultaneous changes in site characteristics estimating this model using a set of permits from wilderness areas leads to revealed preference estimates of the recreational value of clear cuts old growth and nine other wilderness attributes

semi nonparametric distribution free dichotomous choice contingent valuation abstract we apply a semi nonparametric distribution free estimator for binary discrete response data to the estimation of a dichotomous choice contingent valuation model using this estimator mean and median compensating and equivalent variation can be consistently estimated without making nontheoretically motivated assumptions on consumer preferences the approach is illustrated using a contingent valuation survey of willingness to pay for reduction of risk of premature death due to exposure to hazardous waste we find that a conventional parametric estimator and the proposed estimator give similar estimates of unconditional wtp but that conditional on explanatory variables the estimates are quite different

the dual structure of incomplete demand systems integrability of incomplete demand systems is discussed the concepts of weak integrability quasi expenditure function quasi indirect utility function and quasi utility function are defined their relationships to the expenditure function indirect utility function and utility function are developed the dual structure of the quasi functions permits exact welfare analysis and reveals the conditional preference structure for the commodities of interest new results relating the uniqueness and exactness of consumer s surplus to the structure of the expenditure and indirect utility functions are obtained

household labor market choices and the demand for recreation this paper introduces household labor market choices into the demand for recre ation showing that the opportunity cost of time wage rate connection is severed when several household members have the opportunity to par ticipate in the labor market at fixed wages an ap plication of recreation demand for households in new bedford massachusetts shows that the rec reation demand models and estimates of con sumer surplus are sensitive to household labor market choices q26

a utility consistent combined discrete choice and count data model assessing recreational use losses due to natural resource damage abstract a two stage budgeting approach can often be taken when analyzing consumer choice situations in this paper we examine the particular situation where a consumer makes purchases of a discrete commodity of which there are a number of brands in the first stage the consumer decides how many purchases to make in the second stage the consumer decides how to allocate these purchases across brands our econometric approach to this type of situation uses a utility consistent combined discrete choice and count data model the second stage which is specified as a multinomial choice model produces a price index for the commodity which is used to estimate the first stage which is specified as a count data model we apply the model to recreational demand behavior in alaska in order to estimate the welfare losses suffered by recreational users due to the exxon valdez oil spill these results may provide useful input to government agencies attempting to estimate the appropriate level of taxes fines or regulations for deterring damage to the environment

joint recreation choices and implied values of time a model of joint recreation quantity choices is developed individuals choose both total time spent at distant sites and the number of trips taken implicitly choosing average on site time the model permits nonzero marginal utility of travel makes on site time endogenous and is linear in the constraints the scarcity value of time is analyzed without assuming the marginal utility of work time is zero a partially testable assumption about relative marginal values of travel and on site time yields nonparametric calculations of the scarcity value of time and marginal values of trips and days on site from people s observed optimal quantity choices

corporate valuation and social capital a cross country analysis abstractthis article analyses the influence of social capital on corporate valuation for a sample of 55 countries over the period 1995 2012 the results suggest that social capital is an important determinant of corporate valuation interpersonal trust and civic cooperation enhance corporate valuation even though other institutional and legal characteristics are considered furthermore our results reveal that corporate valuation increases with the gdp annual growth rate legal enforcement and the protection of shareholders rights but that it is negatively affected by corruption and protection of creditors rights we also obtain some evidence suggesting that civic cooperation has a greater influence over corporate valuation in poorer countries

separability partial demand systems and consumer s surplus measures abstract in practice complete demand systems are not estimated rather either an incomplete demand system is estimated or separability is invoked and a partial demand system is estimated this paper considers the relationship between the conventional compensating variation equivalent variation and the corresponding welfare measure that can be derived from a partial demand system and the current budget allocation to the separable group even assuming the separability assumption invoked is appropriate these partial measures provide in general only a limited amount of information about the compensating variation and no information about the equivalent variation great care is therefore needed when using partial welfare measures to evaluate policy

nonlinear income effects in random utility models random utility models rums are used in the literature to model consumer choices from among a discrete set of alternatives and they typically impose a constant marginal utility of income on individual preferences this assumption is driven partially by the difficulty of constructing welfare estimates in models with nonlinear income effects recently mcfadden 1995 developed an algorithm for computing these welfare impacts using a monte carlo markov chain simulator for generalized extreme value variates this paper investigates the empirical consequences of nonlinear rums in the case of sportfishing modal choice while refining and contrasting the available methods for welfare estimation

endogenous on site time in the recreation demand model careful modeling of on site time may substantially improve estimates of the bene fits of recreational visits using the travel cost method especially when on site time is endoge nous this paper reviews the theory of endoge nous on site time and shows how the theory may apply to the random utility model rum an empirical example of a two level nested choice model of sport fishing in southcentral alaska il lustrates a discussion of the relative advantages of the different ways to specify endogenous on site time jel q26

revealing preferences for leisure time from stated preference data when consumer choice is constrained by time as well as money willingness to pay can be defined with respect to either numeraire the two measures can be related formally within a utility consistent model of choice subject to two constraints furthermore when information is collected on both the respondent s marginal value of time can be identified a system of willingness to pay time and money and the marginal value of leisure time is estimated jointly in an application to california whalewatching and whale stock enhancement the empirical approach can be applied with only minor additions to survey techniques for nonmarket valuation

using revealed preferences to estimate the value of travel time to recreation sites the opportunity value of travel time vtt is one of the most important elements of the total cost of recreation day trips and arguably the most difficult to estimate most studies build upon the theoretical framework proposed by becker 1965 by using a combination of revealed and stated preference data to estimate a value of time which is uniform in all activities and under all circumstances this restriction is relaxed by deserpa s 1971 model which allows the value of saving time to be activity specific we present the first analysis which uses actual driving choices between open access and toll roads to estimate a vtt specific for recreation trips thereby providing a value which conforms to both becker s and deserpa s theoretical models using these findings we conduct a monte carlo simulation to identify generalizable results for subsequent valuation studies our results indicate that 3 4 of the wage rate provides a reasonable approximation of the average vtt for recreation trips while the commonly implemented assumption of 1 3 of the wage rate generates downward biased results

value of time speeding behavior and gasoline prices abstract value of time vot is a key parameter in economics and policy this paper presents an alternative method to estimate vot by analyzing an hourly dataset on drivers speeding behavior as a function of the gasoline price our identification strategy is novel as it is based on the intensive margin in comparison previous studies reveal vot on the extensive margin but choice alternatives have multiple attributes thereby potentially confounding estimates consistent with the range of the prior literature we find a vot of about 50 of the wage rate and analyze sources of bias from accidents and traffic tickets these bias functions suggest that previous stated preference vot estimates are likely downward whereas previous revealed preference estimates are likely upward biased

the individual travel cost method with consumer specific values of travel time savings the treatment of the opportunity cost of travel time in travel cost models has been an area of research interest for many decades our analysis develops a methodology to combine the travel distance and travel time data with respondent specific estimates of the value of travel time savings vtts the individual vtts are elicited with the use of discrete choice stated preference methods the travel time valuation procedure is integrated into the travel cost valuation exercise to create a two equation structural model of site valuation since the travel time equation of the structural model incorporates individual preference heterogeneity the full structure model provides a travel cost site demand model based upon individualized values of time the methodology is illustrated in a study of recreational birdwatching more specifically visits to a stork village in poland we show that the usual practice of basing respondents vtts on 1 3 of their wage rate is largely unfounded and propose alternatives including a separate component of the travel cost survey aimed at valuation of respondents vtts or as a second best asking if they wish if their journey was shorter and for those who do use full hourly wage as an indicator of their vtts

a two constraint almost ideal demand model of recreation and donations an incomplete demand system is developed for recreation and donation choices subject to both money and time constraints the model results in a three good system with an endogenous marginal value of time for estimation the model is implemented by adapting deaton and muellbauer s locally flexible almost ideal demand system to a two constraint recreation model of trips and donations of california whale watchers exact welfare measures are calculated for changes in costs as well as for whale population changes results indicate a use and a nonuse component of overall willingness to pay for increases in environmental quality

reconciling models of recreational route and site choices when employing travel cost models the unit cost of the essential input travel in the household s production of a recreation experience is central to obtaining the preference structure for the recreational good however little attention has been given to the choice of the route although the route defines the monetary and time costs used to compute travel costs conventional wisdom considers time and money costs in determining the cost per mile in the estimation of site choices but does not use both in determining the route choices and mileages this paper investigates whether models of recreational site and route choices can be reconciled

the opportunity cost of travel time in recreation demand models deciding how to allocate forage among animals is a fundamentally important process in range management the wisdom of these decisions can be enhanced by estimating the marginal value of forage needed by competing species we present a method for

modeling multiple objective recreation trips with choices over trip duration and alternative sites traditionally recreation demand studies have focused on single day single activity trips despite anecdotal and empirical evidence that many recreational trips involve overnight stays and multiple purposes this paper develops a random utility model that explores how visitors choose alternative sites and trip durations for multiple objective trips we focus on a recreational activity beach visits that appear to have significant proportions of the population taking single and multiple day trips and many of the multiple day trips involve multiple objectives multiple duration and multiple objective issues are incorporated in pricing trip costs the results of the research suggest that the accepted method for incorporating travel costs into random utility models can lead to biased estimates of the structural utility parameters and consequently biased measures of welfare in a multiple objective trip setting for single and multiple day users

combining revealed and stated preferences consistency tests and their interpretations this article models the recreation demand for iowa wetlands combining survey data on both actual usage patterns i e revealed preferences rps and anticipated changes to those patterns under hypothetical increases in trip costs i e stated preferences sps we formulate and test specific hypotheses concerning potential sources of bias in each approach and discuss what can be learned about the validity of the models from such tests

recovering individual preferences for non market goods a collective travel cost model traditional recreation demand models do not make a distinction between a household and an individual as the reference decision making unit thus assuming that a family maximizes a single utility function even if the family consists of different individuals such models ignore the possibility of family members divergent preferences for non market goods this study proposes a novel approach the collective travel cost model ctcm to eliciting individual preferences for a non market good such as a recreation site by using revealed preference data this approach accounts for the intra household resource allocation and the role of each household member s preferences we show that the collective travel cost model can be applied to estimating a recreation demand model that yields individual welfare estimates appropriate for policy analysis of non market goods such as the willingness to pay to access a recreation site we find that how resources are distributed within the household reflects significant differences in welfare measures

the demand for leisure time in the presence of constrained work hours w douglass shaw this article presents a labor supply model designed to address situations of overemployment or underemployment in the labor market previous labor supply models have taken the possibility of work hour constraints into consideration but typically assumed that the existence of fixed work hours only influenced the decision of labor force participation this ignores situations in which individuals choose to be employed at fixed hour jobs even though these jobs do not offer the desired work hours jel j22 i introduction early attempts to incorporate time into consumer theory such as those by becker 1965 and by deserpa 1971 and to explain behavior in labor markets such as heckman s 1974 pioneering study relied on the assumption that individuals are able to freely adjust the hours they work the ability of an individual to achieve equilibrium in these models depends on flexible work hours for many individuals however hours of work are likely to be constrained individuals wishing to increase or decrease their work time may face a decision of either accepting the fixed hour schedule or exiting the labor force more refined models of labor force participation put forth by moffitt 1982 tummers and woittiez 1990 and zabel 1993 recognized this by incorporating a fixed hour constraint directly into the labor force participation decision generally these models assume that individuals decide whether or not to accept employment by comparing offered hours with desired hours if desired hours exceed offered hours then the individual enters the labor force models with a fixed hour constraint represent an improvement but they ignore the possibility that a large proportion of the labor force is likely to be either underemployed or overemployed due to the ubiquity of fixed hour employment the presence of these types of jobs is well documented in the literature schor 1991 lists several reasons including lack of lower skilled jobs costly fringe benefits and increased business competition why underemployment and overemployment is prevalent in the u s workplace prior studies by mossin and bronfenbrenner 1967 and by altonji and paxson 1988 document underemployment in the workplace in a study of the u s work force ham 1982 found that unemployed and underemployed workers ranged from 19 2 in 1973 to 28 2 in 1970 1 on the overemployment side tarling 1987 claims that recent evidence indicates that many employees would be prepared to forgo some of their earnings in order to reduce their hours of work p 85 bockstael et al 1987 make a simi lar observation noting that in their sample individuals with fixed working hours appear to value time much more highly than the wage rate and would be willing to trade work for leisure p 301 hahnel 1998 concluded that results from a 1994 survey suggest that u s workers have a slight preference for pay cuts in order to reduce their work hours about 50 of the respondents claimed they would accept a 10 reduction in pay in order to work a four day week well over half of the respondents in the survey claimed that it was either fairly difficult or almost impossible to reduce their work hours and over 60 reported that reducing their work hours would have a negative impact on their careers although the existence of underemployment and overemployment is well documented explicitly accounting for it in labor supply models remains largely unexplored in the literature in this paper the labor supply model originally analyzed by heckman 1974 is extended to recognize and incorporate fixed hour situations heckman s model which has been described as the most prevalent in the literature by zabel 1993 is derived by comparing reservation and market wages in its original form it posited a strong link between the labor force participation decision and the labor supply decision

valuing time in travel cost demand analysis an empirical investigation the opportunity cost of time is usu ally a significant part of the price variable in the travel cost demand model thus its accurate mea surement is important to the estimation of demand and benefit valuation for nonmarket resources this paper empirically tests models which assume that income is the basis for opportunity time cost with an alternative pooled model based on a disequi librium labor market for some recreationists ac ceptance of the hypothesis that disequilibrium mod els may be necessary for some individuals implies increased survey information requirements so that the appropriate model can be applied to each indi vidual jel q21

cost benefit analysis and mammographic screening a travel cost approach abstract this study describes the methodology and presents preliminary results of an economic appraisal of a program to use mobile mammographic screening units in rural areas of australia the benefits of the project are measured using the travel cost method since mammograms are a binary good conventional welfare analysis must be modified and discrete choice models used to estimate the demand for screening the results suggest that the level of welfare benefits depends on the distance a town is from the nearest fixed screening unit in the 10 towns studied the economic benefits of mobile screening outweighed the economic costs if a rural town is situated 29 km or more from a fixed mammographic screening unit

the political economy of nontariff barriers a cross national analysis nontariff barriers to trade are most pervasive when deteriorating macroeconomic conditions give rise to demands for protection by pressure groups when countries are sufficiently large to give policymakers incentives to impose protection and when domestic institutions enhance the ability of public officials to act on these incentives statistical results based on a sample of advanced industrial countries during the 1980s support the argument that the incidence of nontariff barriers tends to be greatest when the preferences of pressure groups and policymakers converge more attention should be devoted to the interaction between societal and statist factors in cross national studies of trade policy

the opportunity cost of travel time as a noisy wage fraction few issues are more important to welfare estimation with recreation demand models than the specification of the opportunity cost of travel time the two most common approaches to specifying this cost treat it as a fixed fraction of the recreationist s wage and either estimate the fraction done infrequently or assume it takes some value done commonly with references to results from the commute time literature used to justify the latter however these approaches lack firm conceptual rationales and the consequences of using them are not fully understood recognizing that information limitations often preclude more general approaches we use a joint recreation travel labor supply model to show that under relatively modest assumptions the opportunity cost of travel time can be expressed as a wage fraction with noise this formulation is straightforward to implement as part of random parameters based recreation demand models we then evaluate the welfare consequences of using the two approaches noted above which are special cases of the noisy wage fraction specification our results suggest that the more critical restriction to relax in opportunity cost of travel time specifications is the absence of noise rather than the specific level of the wage fraction

willingness to pay for snowmobile recreation travel cost method models with and without post season resurvey of trip count annual willingness to pay wtp for snowmobile recreation in idaho is estimated using the travel cost method tcm on site snow conditions are important and erratic thus we collect two measures o

exact consumer s surplus and deadweight loss consumer s surplus is a widely used tool in applied welfare economics both economic theorists and cost benefit analysis often use consumer s surplus despite its somewhat dubious reputation the basic idea is to evaluate the value to a consumer or his willingness to pay for a change in price of a good from say pricep to pricep because price changes affect consumer welfare an evaluation of this effect is often a key input to public policy decisions yet consumer s surplus is probably the most controversial of widely used economic concepts both paul samuelson and ian little conclude that the economics profession would be better off without it it is my feeling of the situation that substantial agreement exists on the correct quantities to be measured the amount the consumer would pay or would need to be paid to be just as well off after the price change as he was before the price change the quantities correspond to john hicks compensating variation measures an alternative measure which takes ex post price change utility as the basis of comparison is hicks equivalent variation the controversy arises in the measurement of these quantities the usual measurement procedure is to use the area to the left of the marshallian market demand curve between two price levels jules dupuit originated this measure of welfare change and alfred marshall and hicks derived appropriate conditions for its use the primary condition for the area to the left of the demand curve to correspond to the compensating variation is to have constant marginal utility of income marshall gave this condition and if it holds the same quantity will be derived as the area to the left of the compensated hicksian demand curve this area to the left of the compensated demand curve is exactly what the compensating variation and equivalent variation measure thus the constant marginal utility of income is a sufficient condition for marshallian consumer s surplus to be equal to hicks consumer s surplus in this case arnold harberger s plea to use the welfare triangle as one half times the product of the price change times the quantity change to measure deadweight loss corresponds to the correct theoretical amount of welfare change in a recent paper robert willig derives bounds for the percentage difference between the correct measure of either the compensating or equivalent variation and the marshallian measure derived form the market demand curve his bounds which depend on the income elasticity of demand for the single good in the region of price change being considered as well as the proportion of the consumer s income spent on the good demonstrate that the marshallian consumer s surplus is often a good approximation to hicks consumer s surplus the fact that the proportion of the consumer s income spent matters as well as the income elasticity was first pointed out by harold hotelling willig contends that the approximation error will be less than the errors involved in estimating the demand curve thus he hopes to remove the need for apology that applied economists often need to give to theorists who remark on the inappropriateness of using marshallian consumer s surplus to measure welfare change however in this paper i show that for the case primarily considered by willig of a single price change which is also the situation in which consumer s surplus is often used in applied work no approximation is necessary professor of economics massachusetts institute of technology and research associate national bureau of economic research i would like to thank peter diamond erwin diewert daniel mcfadden robert merton robert solow hal varian joel yellin and the referees for help and comments research support from the national science foundation is acknowledged the reason that we still have two rather than one of samuelson s six measures of consumer s surplus arises from an index number problem of the correct basis for the welfare comparison i will give both measures but plan to concentrate on the compensating variation

the recreational value of lake mckenzie fraser island an application of the travel cost method lake mckenzie is one of the most highly used and popular visitor destinations of all fraser island s natural sites attracting 2000 visitors a day in peak periods many consider this level of visitation to be unsustainable and the management authority is currently considering a range of management options to address this issue in assessing the alternatives it is useful to have some idea of the recreational use value of the lake under the current regime as it is this value that is at risk if visitor numbers are to be reduced this paper using the zonal travel cost method estimates the recreational use value of fraser island and lake mckenzie for australian resident independent visitors

corporate valuation around the world the effects of governance growth and openness abstract the purpose of this paper is to provide a comprehensive analysis of corporate valuation around the world specifically we i document and compare corporate valuation around the world and ii identify the key factors that drive cross country differences in valuation in doing so we utilize the country level tobin s q ctq computed as the ratio of the aggregate market value to book value of all assets held by all public firms domiciled in a country which amounts to the tobin s q for the market portfolio of the country the key findings of the paper are first ctq varies greatly across countries ranging from 0 73 for venezuela to 2 11 for finland with the international mean of 1 30 during our sample period 1999 2004 despite the steady integration of the world economy in recent years corporate valuation remains starkly different across countries second apart from the effect of corporate governance cross country differences in corporate valuation are significantly driven by the growth options of countries represented by the r d intensities capital expenditures and gdp growth in addition the degree of capital market openness has a significant independent effect on valuation third our regression analyses show that ctq varies directly with shareholder rights enforcement of insider trading laws gdp growth r d intensity and the degree of capital market openness the key findings remain robust to the inclusion of inflation and industry effects

u s trade policy recent changes and future u s interests there have been major changes in recent years in the trade policy strategy used by the united states in promoting its economic and political goals in contrast to the benevolent multilateral approach from the early 1940s through the 1960s in which international cooperation aimed at strengthening the free world was emphasized the united states in the 1970s and 1980s has increasingly pursued an aggressive bilateral strategy oriented toward domestic economic interests and particular regional political objectives one manifestation of this policy shift is the increased use of bilateral negotiations in which the united states threatens to restrict access to its domestic market in order to force open a trading partner s markets for more u s exports or to curtail market disrupting imports from the country negotiating free trade agreements with the caribbean basin israel and canada is another other indicators of this strategy shift are an increased emphasis on fair trade the greater use of the antidumping and countervailing duty laws to restrict imports and a willingness to give up the most favorednation principle in limiting imports even when injury to a domestic industry is not due to unfair foreign trade practices the united states has not abandoned the multilateral approach as its participation in the uruguay round negotiations demonstrates but even here the united states seems less willing than in the past to compromise for the purpose of achieving a consensus among the participants this paper briefly analyzes the reasons for this shift in trade policy strategy and considers its usefulness for promoting u s interests in the future i from hegemon to oligopsonist

welfare estimation using the fourier form simulation evidence for the recreation demand case the paper considers the estimation of welfare measures when the functional form of demand is unknown an adaptation of an argument of gallant 1987 is used to show that welfare estimators based on a fourier functional form for demand will be consistent under weak assumptions simulation evidence is presented for equivalent variation true demand is a generalized box cox function estimated demand is a fourier form and equivalent variation is estimated by applying vartia s 1983 algorithm to the estimated demand function the estimator of equivalent variation has small asymptotic bias in the case of the assumed family of data generating processes

specification of driving costs in models of recreation demand existing recreation demand models have paid much attention to the heterogeneous nature of the opportunity cost of time but generally stipulate constant per mile costs in access price specifications this study proposes two alternative approaches to introduce user specific driving costs into recreation demand models the first approach is based on a refined measurement of driving costs based on engineering considerations the second strategy estimates perceived per mile cost as a function of vehicle attributes in an empirical framework we find strong evidence that driving costs are a visitor specific concept and that prescribed and perceived costs differ substantially however welfare measures generated by these alternative specifications are not statistically different from those produced by the standard model in our application of jet skiing in the lake tahoe region

recreation demand choices and revealed values of leisure time i introduction at least since the work of becker 1965 it has been recognized widely that time may play an important role in consumer demand one of the areas where this may be most significant empirically is in the valuation of natural resource amenities through their associated recreation demands a principal reason is that recreation is a time intensive commodity so that the value of the time spent in recreation would be expected to play a large role in its overall value the potential bias to consumer s surplus estimates of the net economic value of recreation from excluding time prices from the demand model has been recognized from the outset for example by knetsch 1963 and clawson 1959 to incorporate time into recreation demand models researchers have generally adopted the practice suggested by mcconnell 1975 of defining the full price of recreation as the money cost of a trip plus its monetized time cost though the use of full budgets also called for by the becker approach is less widespread bockstael et al 1987 pointed out quite clearly that both full budgets and full prices are required in the demand function if the recreationist is jointly choosing labor supply with recreation at an exogenous marginal wage but that the structure of demand was unclear if the individual was not making such marginal labor supply choices i e if he or she was working fixed hours subsequently larson and shaikh 2001 showed that the full prices full budgets specification is sufficient to satisfy the constraints on demand parameters that arise because choice is made subject to two binding constraints regardless of the individual s position in the labor market they also pointed out that models that use full prices but only money income in effect ignoring the role of time as a resource constraint cannot be consistent with the requirements of choice subject to two constraints although the outlines of how time should enter the structure of demand are becoming clear a major unresolved issue is how to determine its value in practice several studies have followed the basic logic of becker s early work assuming that the opportunity cost of recreation time i e the value of other time forgone in favor of recreation is an exogenous parameter such as the average wage rate or more commonly some fraction thereof this fraction is either chosen arbitrarily or estimated as part of the recreation demand model as in cesario 1976 mcconnell and strand 1981 and smith et al 1983 such assumptions may be erroneous for a variety of reasons assuming the average wage is the appropriate opportunity cost of time presumes that the individual faces no constraints on hours worked derives no utility or disutility from work and has a linear wage function as has been noted by chiswick 1967 bockstael et al 1987 and smith et al 1983 this is unlikely to be true for many people assuming some constant fraction of the wage is the opportunity cost of time especially an arbitrarily chosen fraction also seems likely to be incorrect for most people for all of these reasons an individual s average wage does not necessarily reveal anything about the shadow value of discretionary leisure time either as an upper or lower bound in a recent advance feather and shaw 2000 adapted the heckman 1974 labor supply model to include information supplied by recreationists about their labor supply status in particular whether they felt under or over employed relative to their desired number of hours this information is used to identify subgroups in the data for which the shadow value of leisure time is less than the wage or more than the wage which helps in the estimation of both a wage function and a shadow value of leisure time function this approach produces individual specific estimates of the opportunity cost of leisure time based on their demographics and labor market decisions which are used in a subsequent recreation demand analysis

disentangling the incentive and entrenchment effects of large shareholdings this article disentangles the incentive and entrenchment effects of large ownership using data for 1 301 publicly traded corporations in eight east asian economies we find that firm value increases with the cash flow ownership of the largest shareholder consistent with a positive incentive effect but firm value falls when the control rights of the largest shareholder exceed its cash flow ownership consistent with an entrenchment effect given that concentrated corporate ownership is predominant in most countries these findings have relevance for corporate governance across the world

time is money improved valuation of time and transportation costs the proper valuation of time isimportant for estimating the demand for severaleconomic goods this paper explores the propervaluation of time when estimating recreationaldemand where time costs represent asubstantial portion of the purchase price toestimate demand this paper uses a travel costframework to analyze actual behavior revealedpreference data and hypothetical behavior stated preference data which is induced byhypothetical increases in access fees traveltime and travel distance by comparing theresponses to these three contingencies theanalysis adjusts and improves the valuation oftime costs as evidence of this improvement this analysis demonstrates a great increase inthe consistency between the revealed and stateddata similarly this paper improves thevaluation of transportation related costs

trust in large organizations several authors suggest that trust is an important determinant of cooperation between strangers in a society and therefore of performance of social institutions we argue that trust should be particularly important for the performance of large organizations in a cross section of countries evidence on government performance participation in civic and professional societies importance of large firms and the performance of social institutions more generally supports this hypothesis moreover trust is lower in countries with dominant hierarchical religions which may have deterred networks of cooperation trust hold up remarkably well on a cross section of countries this abstract was borrowed from another version of this item

on site time in the demand for recreation the standard travel cost model has treated on site time ambiguously over the years this paper shows how to handle on site time by exploring the implications of two assumptions in the travel cost model first people choose the amount of time that they spend on a site and second the time spent on site is exogenous this paper uses a duality result to show that when on site time is chosen the standard travel cost demand function takes a particularly simple form with slight modification standard estimation and welfare calculations continue to hold

short run constraints and the increasing marginal value of time in recreation leisure activities such as local recreation trips usually take place in discrete blocks of time that are surrounded by time devoted to other commitments it can be costly to transfer time between blocks to allow for longer outings these observations affect the value of time within those blocks and suggest that traditional methods for valuing time using labor markets miss important considerations this paper presents a new model for time valuation that uses non employment time commitments to infer the shadow value of time spent in recreation a unique survey that elicited revealed and stated preference data on household time allocation is used to implement the model the results support the conclusion that there is an increasing marginal value of time for recreation as the trip length increases

accounting for stochastic shadow values of time in discrete choice recreation demand models abstract in this paper a discrete choice recreation demand model that explicitly accounts for a stochastic shadow value of time function is proposed using data from a survey of san diego beach users the stochastic shadow value of time labor supply and beach choice are jointly estimated results from this joint estimation approach are compared with the familiar two step approach that estimates labor supply first and uses predicted values of time in the recreational site choice model the approaches produce markedly different welfare measures with the two step model which does not account for unobserved variability of time values predicting significantly higher values a monte carlo simulation illustrates how ignoring the stochastic nature of shadow value of time in discrete choice recreation demand models can bias model parameters and hence welfare estimates

time and the recreational demand model in this paper a theoretically consistent approach to including time costs in recreational demand models is developed the demand model is conditional on the recreationist s labor market situation for individuals at corner solutions in the labor market utility maximization is subject to two constraints leading to a demand function with travel costs and travel time as independent variables with interior solutions in the labor market time is valued at the wage rate and combined with travel costs to produce one full cost variable in an illustration welfare measures based on the new model are estimated for a sample of sportfishermen

increased protection in the 1980s exchange rates and institutions the strong appreciation of the u s dollar between 1980 and 1985 encouraged the substitution of imports for domestically produced goods for a variety of products this in turn increased the demand for trade protection many of these demands were satisfied via apolitical u s antidumping and countervail regulations yieldingad valorem tariffs well above current average statutory duties the supply of trade protection is developed via a principal agent model that describes the potential gains to both the regulatory agency and the legislator empirical results support the model specification finding both exchange rate and political cycles in the use of apolitical trade protection

the choice of ski areas estimation of a generalized ces preference ordering with characteristics abstrac t a generalized ces gences preference ordering is developed and estimated it incorporates characteristics of both the individual and the activities the gences is used to explain the share of ski time an individual allocates to each ski area as a function of site characteristics skiing ability and costs the stochastic specification limited the shares to the 0 1 simplex this specification was found to be more appropriate than the conventional normality assumption the null hypothesis that preferences are homothetic and additive is rejected charactenrstics ability and costs are important determinants of demand the estimated elasticities provide numerous insights into skier behavior

empirical specification requirements for two constraint models of recreation choice two constraint models are common in recreation demand analysis because of the important role time can play in consumer choices two versions of roy s identity hold for these models and imply coefficient restrictions on empirical demand functions the two constraint restrictions are fully observable and can be expressed in a form analogous to the slutsky hicks equations in single constraint consumer models empirical specifications that use full prices and full budgets can be consistent with the two constraint models when the marginal value of time is either exogenous or endogenous but models with full prices and money income alone are not copyright 2001 oxford university press

a reconsideration of the sugar sweetened beverage tax in a household production model abstract we study the impact of a hypothetical tax on sugar sweetened beverages ssbs on the u s households nutrients purchase welfare change and health benefit differently from the traditional approach food at home fah is here defined as a home good instead of a market good and consumers demands derived under the assumption that households maximize utility subject to both a money and a time constraint the model is estimated by using an incomplete approximate exact affine stone index easi demand system on a data set built by merging the u s consumer expenditure and time use surveys results show that a ssb tax would be much more effective in decreasing household nutrients purchase than it would appear by estimating a model neglecting time costs in home food production due to a lesser compensation of calories from increasing fah consumption a tax induced 38 increase in ssb price is predicted to decrease the per capita energy purchase by 41 kcal day

measuring the cost of time in recreation demand analysis an application to sportfishing since the work of cesario and knetsch economists have recognized that the opportunity cost of time plays an important role in determining the demand for outdoor recreation the opportunities one has for spare time are more significant for consumption of time intensive outdoor recreation activities than for other commodities especially nondurables bishop and heberlein illustrate the overwhelming importance of time costs to final recreational values total consumer surplus is nearly four times as large when time costs are added at half the income rate as when time costs were set at zero p 21 despite the recognition economists have neither successfully integrated the costs of time with the methods of recreational demand analysis nor reached a consensus on how it should be measured brown charbonneau and hay state finally the apparently crucial importance of how opportunity cost of time is handled needs further work while we are convinced it is an appropriate concept exactly how it should be included and measured s remains to be determined p 24 several approaches have been taken to include it in the travel cost method one approach brown and nawas gum and martin suggests that time in transit be considered as a separate independent variable another approach bishop and heberlein brown charbonneau hay nicols bowes dwyer cesario and knetsch measures the cost of time and adds it to other costs several approaches have been suggested to measure time costs one approach is simply to choose an hourly wage e g 2 00 per hour or perhaps the minimum wage rate a more flexible but still ad hoc approach is to use some proportion of the individual s wage rate as the opportunity cost of time nichols bowes dwyer the proportion is usually taken from independent studies and used to value the travel time this approach is better than using a constant opportunity cost of time because it allows variation across individuals it suffers because the choice of the percentage of the wage rate is arbitrary independent of the sampled population cesario has discussed the consequences of ignoring time costs and the differences in values arising from alternative measurement approaches in this paper we argue that the opportunity cost of time is some proportion of the individual s market wage rate or income per hour and that this proportion can be determined from sample data this method permits the proportion to vary from one study to another rather than imposing either an arbitrary estimate or one from a sample different from the study s sample

the length of stay in the demand for tourism abstract one of the main characteristics of current tourism is the reduction in the length of stay at a destination nevertheless this variable has received little attention in literature this paper examines the microeconomic determinants of the length of stay at one of the mediterranean s leading sun and sand destinations the estimation of a conditional demand function model highlights the explanatory power of the tourist s sociodemographic profile and of holiday characteristics as well as the sensitivity of the length of stay to price changes

to steal or not to steal firm attributes legal environment and valuation data on corporate governance and disclosure practices reveal wide within country variation that decreases with the strength of investors legal protection a simple model identifies three firm attributes related to that variation investment opportunities external financing and ownership structure using firm level governance and transparency data from 27 countries we find that all three firm attributes are related to the quality of governance and disclosure practices and firms with higher governance and transparency rankings are valued higher in stock markets all relations are stronger in less investor friendly countries demonstrating that firms adapt to poor legal environments to establish efficient governance practices

estimation of a labour supply model with censoring due to unemployment and underemployment this study proposes and implements a method of labour supply estimation which is appropriate when the sample contains unemployed and underemployed workers the estimation method consists of excluding unemployed and underemployed workers from the sample and then using to avoid selection bias an extension of heckman s approach to the case where two correlated selection rules generate the sample hausman s specification test is then used to determine whether ignoring constrained workers has led to biases in traditional labour supply estimates and the empirical results suggest that previous estimates of several important parameters are biased since the biases go in the direction that would be predicted by the hypothesis that the unemployed and underemployed are constrained the results support this hypothesis