estimating a price surface for vacant land in an urban area tthis paper examines urban land prices within a non parametric framework with specific interest in the land price gradient with respect to distance from the city center the land price surface is estimated over a 900 square mile portion of the chicago metropolitan area and is based on transaction level data of vacant land parcels the price surface is estimated using piecewise parabolic multiple regression proposed by colwell 1998 given the flexibility of this approach a rather complex price surface is revealed the estimated price surface provides some support for the standard urban economic doctrine of falling land prices with distance

does tax increment financing raise urban industrial property values the paper examines the impact of tax increment financing tif on the value of industrial properties in chicago because tif designation may be self selected a two stage procedure is used to estimate the influence of tif the authors find that the value of industrial parcels located in mixed use tif districts i e those that also contain commercial or residential properties is higher than that of similar parcels that are not located in a tif district however the value of industrial parcels that are located in homogeneous industrial use tif districts is no higher and in some specifications is lower than that of similar parcels not located in a tif district these divergent results may be best explained by industrial parcel owners desire to convert their properties to non industrial uses

measuring interactions among urbanization land use regulations and public finance this article presents a polychotomous choice selectivity model to estimate the interactions among urbanization land use regulations and public finance in five western states california idaho nevada oregon and washington land use regulations in these five states reduced the total developed area by an estimated 12 2 from 1982 to 1992 but increased housing prices between 1 3 and 4 7 depending on the intensity of land use regulations in a county land use regulations also reduced public expenditure and property tax in the long run by 5 6 and 8 4 respectively but increased public expenditure and property tax in the short run by 9 8 and 12 6 local land use policies have been examined in a number of studies e g epple romer and filmore henderson levine mcdonald and mcmillen phillips and goodstein however little empirical evidence is available on which factors motivate adoption of land use regulations nor has there been much systematic analysis of the impact of land use regulations on land development and public finance in this article we present an empirical model to evaluate quantitatively the interactions among urbanization land use regulations and public finance in five western states of the united states oregon california idaho nevada and washington we provide estimates of both the extent to which the rate of development affects the demand for more restrictive land use regulations as well as the subsequent impact of those regulations on land development housing prices public expenditure and property tax because local political processes determine land use regulations treating regulations as exogenous may cause a selection bias when analyzing their effect on development pogodzinski and sass the endogenous nature of zoning regulation was first raised by

internalizing neighborhood externalities the effect of subdivision size and zoning on residential lot prices abstract though land development regulations potentially control neighborhood externalities the developer of a residential subdivision contributes to that control by developing a larger parcel of land this paper reports estimates of the effect of parcel size on the sale price of developed building lots the results indicate that adding an acre to the median development increases lot prices by about 3 amenities appear to be income normal and the return to parcel size is greater in unincorporated areas perhaps due to less intensive governmental control over externalities

explaining metropolitan housing price differences abstract housing prices differ substantially among metropolitan areas the rent and house price indexes used here measure this variation among 54 metropolitan areas a model of metropolitan housing price determination is presented and used to identify the sources of intermetropolitan price variation reduced form equations explain close to 90 of the variation in rental prices and close to 60 of the variation in house prices

an alternative approach to housing market segmentation using hedonic price data abstract much empirical research has been devoted to housing market segmentation and the implications for the application of the hedonic price model market segmentation is demonstrated empirically in j urban econ 3 2 146 166 1976 j urban econ 7 1 102 108 1980 rev econ statist 66 3 404 406 1974 there appears to be theoretical evidence j pol econ 82 1 34 55 1974 that such empirical efforts may have been less than adequate unfortunately the empirical applications of rosen s model j environ econ manag 5 81 102 1978 j urban econ 5 3 357 369 1978 do not seem to effectively account for the complexity of the factors which cause multiple equilibria market segmentation this paper demonstrates empirically that market segments can be defined along more dimensions than hitherto have been included in any analysis

made by mistake when mistakes increase product preference mistakes are often undesirable and frequently result in negative inferences about the person or company that made the mistake consequently research suggests that information about mistakes is rarely shared with consumers however we find that consumers actually prefer products that were made by mistake to otherwise identical products that were made intentionally this preference arises because consumers perceive that a product made by mistake is more improbable relative to a product made intentionally and thus view the product as more unique we find converging evidence for this preference in a field study six experiments and ebay auction sales importantly this preference holds regardless of whether the mistake enhances or detracts from the product however in domains where consumers do not value uniqueness e g utilitarian goods the preference is eliminated

why has u s inflation become harder to forecast we examine whether the u s rate of price inflation has become harder to forecast and to the extent that it has what changes in the inflation process have made it so the main finding is that the univariate inflation process is well described by an unobserved component trend cycle model with stochastic volatility or equivalently an integrated moving average process with time varying parameters this model explains a variety of recent univariate inflation forecasting puzzles and begins to explain some multivariate inflation forecasting puzzles as well

sprawl or reagglomeration the dynamics of employment deconcentration and industrial transformation in greater paris from 1975 to 1999 employment in the paris metropolitan area became more and more decentralised the losses from central areas were divided equally between sprawl and peripheral clusters parallel to the deconcentration of jobs the growth of a services oriented economy has led to an increase in sectoral concentration however there is no clear evidence of a vertical spatial disintegration because at the same time the economy of all places has tended to diversify one explanation might be that sprawl relies both on endogenous job creation and on job relocation relocations tend to increase the specialisation of the clusters while endogenous growth is more diverse thanks to the importance of domestic activities

an empirical examination of quality certification in a lemons market i introduction researchers have long understood that a variety of mechanisms may be used to overcome problems of adverse selection stigler 1961 224 notes that s ome forms of economic organization may be explicable chiefly as devices for eliminating uncertainties in quality and akerlof 1970 cites independent groups such as the consumers union and united laboratories that test and certify the quality of goods there is however little empirical evidence that illustrates the effectiveness of such mechanisms in this article we examine the effect certification has on a market characterized by adverse selection using data from the market for young thoroughbreds we compare the performance of sales where auction houses provide certification services with sales where certification is absent the thoroughbred racehorse market consists of two distinct types of public auctions certified and noncertified sales in a certified sale auction houses physically inspect the horses nominated to their sales selling only the horses they conclude are from the upper end of the quality distribution in noncertified sales auction houses sell all horses nominated to a sale our empirical strategy is to perform tests that indicate whether adverse selection affects market outcomes in either certified or noncertified sales a finding that adverse selection is present in noncertified sales but absent in certified sales is consistent with the hypothesis that certification alleviates problems of adverse selection we adopt three approaches to test for the presence of adverse selection 1 the first approach is in the spirit of chiappori and salanie 2000 who examine the relationship between unobservable factors from participation and performance equations we model adverse selection as a case of sample selection bias and examine the correlation between errors in participation and price equations 2 to accomplish this we use a unique data set that allows us to estimate how breeder decisions to sell or retain horses affect market prices the data set consists of a 10 random sample of all thoroughbreds born in 1993 and includes both horses retained by their breeders who own a horse at the time of its birth and horses that breeders chose to sell our second test follows genesove 1993 and chezum and wimmer 1997 by examining the relationship between seller characteristics and price theoretically when observable seller characteristics are correlated with seller incentives to select goods adversely prices should reflect these differences chezum and wimmer observe that some breeders sell all of their horses whereas others retain a portion to race they find that market prices are inversely related to the extent of a breeder s involvement in racing concluding that adverse selection affects market outcomes we extend this work in two respects first we isolate the effect seller characteristics have on price through the decision to sell or retain a horse second we compare the effect seller characteristics have on observed prices in certified and noncertified sales our last test follows bond 1982 who attempts to identify adverse selection in the market for used trucks by comparing the repair records of trucks that were sold with the records of trucks retained by their original owners because the horses in our sample had not begun their racing careers at the time they were sold we use data on racetrack earnings as an ex post measure of quality and compare the quality of horses sold in noncertified sales with certified horses and horses retained by their breeders the results from each approach are consistent with certification alleviating problems of adverse selection we find that holding observable attributes constant horses that would receive unusually high market prices in noncertified sales are even more valuable in other options and are less likely to be sold in a noncertified sale

measuring the accuracy of federal reserve forecasts markets across the world pay enormous attention to every economic forecast made by federal reserve governors particularly those from the chair this article develops a new way that the academic literature can assess the accuracy of these federal reserve forecasts in particular our proposed method allows for both general and specific predictions to be assessed while also accounting for the macroeconomic volatility that prevails at the time of the forecast to develop this measure we expand upon a methodology proposed by the wall street journal to score the accuracy of forecasts made by the fed our results show that alan greenspan was consistently the most accurate forecaster among fed governors while the most recent chair in our sample janet yellen has performed relatively poorly more generally we find that the chairs have become less accurate over time with their forecasts and have also tended to make fewer specific predictions

exploring spatial dynamics with land price indexes the purpose of this study is to explore the within region spatial dynamics of appreciation and depreciation rates using three different representations of geographical space mean value indexing methods are used to construct global land price indexes sub market land price indexes and local land price indexes using transaction price data for vacant residential land within the city of hamilton ontario between 1995 and 2003 the results are validated against statistics canada s series of new housing price indexes followed by a comparison of the relative performance of the three geographical representations of land price indexes the results indicate that the mean value indexing methods are robust although subject to outliers and sample selection bias and clearly illustrate the spatial dynamics of annual appreciation and depreciation rates across the study area the results also underscore the need for regular surveillance of the spatial dynamics of urban land markets

the effects of potential land development on agricultural land prices abstract we conduct a national scale analysis of the determinants of agricultural land values the theoretical basis for the study is a spatial city model with stochastic returns to future land development the empirical model of agricultural land prices is estimated with a cross section on approximately three thousand counties in the contiguous us the results provide evidence that option values associated with irreversible and uncertain land development are capitalized into current farmland values for each county we decompose the current agricultural land value into components measuring rents from agricultural production and rents from future land development

agricultural land values and the value of rights to future land development we investigate the inuence of fu ture land development on current agricultural land values from a theoretical model of land markets we derive a reduced form expression for agricultural land values in terms of observable variables this result dictates the speci cation of our econometric model and we nd strong sup port for the model in an application to new york state the estimated model together with a spa tial interpolation algorithm is used to generate a surface of estimated development rights values for orange county this approach overcomes several problems that arise with the use of stan dard appraisal methods to value conservation easements jel q24

occupational segregation and selectivity bias in occupational wage equations an empirical analysis using irish data the gender wage effects of occupational segregation are assessed within the framework of occupational attachment and wage equations this paper exploits the modified index number approach suggested by brown et al 1980 and used recently by miller 1987 however neither of these papers allowed for the potential effects of selectivity bias in occupational wage equations in this study selectivity bias is corrected for using the method outlined in lee 1983 this allows for the effects of occupational selectivity buas on the gender wage gap to be assessed the findings for this sample of young lrish workers suggest that the greater part of the female wage disadvantage lies in intraoccupational wage differences furthermore selectivity bias is found to be important for a number of occupational categories

introducing the bank of canada staff economic projections database we present a new publicly available database of real time data and forecasts from the bank of canada s staff economic projections which will be updated on an annual basis we describe the data construct its variables coverage and frequency we then provide a forecast evaluation for gross domestic product gdp growth consumer price index cpi inflation and the policy rate since 1982 we compare the staff s forecasts with those from commonly used time series models estimated with the real time data and with forecasts from other professional forecasters and provide standard bias tests finally we study changes in predictability of the canadian economy following the announcement of the inflation targeting regime in 1991 our data set is unprecedented outside the usa and our evidence is particularly interesting as it covers over 30 years of staff forecasts two severe recessions and different monetary policy regimes

female labor supply in japan implications of the informal sector for labor force participation and hours of work this paper extends previous work on labor supply in japan by treating the simultaneous labor force participation and hours of work decisions for japanese wives both employees and family workers it estimates a trichotomous participation model for a sample from the tokyo metropolitan area and then estimates hours and wage equations and aggregate labor supply elasticities the empirical results generally confirm the economic model s theoretical predictions although the estimated aggregate wage and income elasticities for employees are somewhat higher than previous estimates for the u s they are of the same order of magnitude however the level of the husband s income has an unexpected positive effect on the annual hours that employees work and the elasticities estimated for family workers are usually large

dwelling attribute forecasts based on land residual maximization this paper uses an implicit market approach to model the highest and best use concept when applied to single family residential development formulated from the landowner s perspective this persistence forecasting model relies on the theory that the marginal product of a site as determined by its locational traits varies with each alternative dwelling type the dwelling attribute bundle that maximizes its site s marginal product as measured by the resultant land residual value becomes that site s best use the empirical results indicate a site s locational attributes can provide reasonable dwelling type forecasts

agritourism and off farm work survival strategies for small farms this study considers agritourism and off farm work as income diversification choices simultaneously and analyzes factors influencing such choices further the study assesses the impact of agritourism off farm work and both on gross cash farm income and total farm household income we utilized large set of nationwide farm survey data and selectivity based multinomial choice model an important finding of our study is that small farms have higher household income if they choose both income diversification strategies rather than a single strategy results suggest that education age of the operator financial condition and location of the farm are important factors driving income diversification alternatives finally our study indicates that accounting for selectivity is essential to ensure unbiased and consistent estimates

zoning and the distribution of location rents an empirical analysis of harris county texas the coase theorem presents two criteria for evaluating regulation regulations efficiency relative to private solutions and how the regulation affects the distribution of wealth previous studies of the impact of municipal zoning have focused on coase s first criteria whether zoning raises land values overall this study estimates the transfer of wealth between owners of existing homes that results from the creation of a municipal zoning ordinance we find that property best suited to residential use gains in value while property with relatively higher potential as commercial property experiences a decline in the value we find that zoning is distributive

the earnings impact of training duration in a developing country an ordered probit selection model of colombia s servicio nacional de aprendizaje sena this study estimates the earnings impact of one of the most extensive in service training programs in the developing world colombia s sena through a comparison of nongraduates and graduates earnings profiles the possible influence of selection is corrected through the use of an ordered probit model to determine participation in short and long courses the correction causes a significant decline in sena s earnings effect the results are robust with respect to alternative specifications of the selection model

site density restrictions measurement and empirical analysis abstract restrictions on the density at which development can occur are a central tool of land use regulation yet they are understudied in the empirical literature in this paper we present a methodology to identify how much restrictions on the ratio of building space to lot area constrain developers our approach generates a measure of the distortion from the private optimum caused by restrictions as a function of land prices and the maximum allowed ratio of floor space to lot area we use this methodology to examine how the set of incentives facing different levels of local government in shanghai china affects density constraints on redevelopment sites in the city s emerging real estate market

the market effects of zoning undeveloped land does zoning follow the market through restricting the uses of land zoning gives local governments the power to modify the dictates of unconstrained land markets many believe however that the regulations tend to coincide with or anticipate the market solution rather than modify it the validity of this assertion is an empirical question and has not yet been adequately addressed the purpose of this paper is to develop and apply an empirical test of the null hypothesis that zoning follows the market the null hypothesis can be rejected only if land uses under zoning differ from what they would be without zoning the first task in deriving the test is to differentiate between constrained and unconstrained land market allocations it is shown that parameter estimates for hedonic price functions when markets are zoned cannot be interpreted to imply that the regulations constrain market prices it is also shown that sample selection bias is a likely source of specification error in estimating hedonic price functions for zoned land markets since the sample selection of parcels to zone designations is unlikely to be random the selection process must be accounted for in ordinary least squares ols estimation of zone constrained hedonic price functions fortunately the correction for the specification error also provides a test for the market effects of zoning a bid price interpretation of hedonic price functions for land is presented in section ii the sample selection bias issues are also discussed in that section and a formal test for the market effects of zoning is introduced

the central bank as shaper and observer of events the case of the yield spread the yield spread has commonly been employed as a successful predictor of economic growth and recessions although its marginal predictive power has decreased since the 1990s notably the yield spread s declining power to predict us economic activity coincided with its growing power to predict us interest rate changes in my view these phenomena are inevitably linked and share one cause the central bank intended to enhance both its transparency and credibility through greater information disclosure this disclosure improved interest rate predictability but might also have crowded out useful private information formerly in the yield spread that helped predict economic activity

has the economy become more predictable changes in greenbook forecast accuracy several researchers have recently documented large reductions in economic volatility but a more important question may be whether the economy has become more predictable using forecasts from the federal reserve greenbooks i find that inflation and output have become more predictable though the results for output are somewhat mixed the reductions in unpredictability if any are significantly smaller than reductions in volatility associated with this the predictable component of fluctuations in output and inflation has virtually disappeared

returns to endogenous education the case of honduras the rapid expansion of the education sector in developing countries and the scarcity of public funds have increased the need for an accurate evaluation of educational policies estimates of rates of return to education have often been used as an integral part of cost benefit studies and programme evaluation efforts this study uses household survey data from honduras for 1990 to estimate returns to education that allow for worker heterogeneity and individual self selection in the education process a sequential estimation procedure is used that enables study of the interaction between educational attainment and earnings determination it is found that accounting for endogenous educational attainment leads to substantially higher estimated returns to education compared to traditional least squares estimates the possible magnitude of the bias underscores the importance of recognizing the role of self selection and comparative advantage in the education process

a study of the impacts of zoning on housing values over time abstract using a virtually unique data base for vancouver canada this study examines the ways in which various zoning classifications and land uses affect the sale prices of single family residences over a 24 year period the overwhelming conclusion is that while there are impacts they are consistent in neither direction nor magnitude the results suggest that the negative externalities that are generally assumed to exist may in fact not exist as a result the use of zoning to control the effects of such presumed externalities may not be justified

an alternative test of the hedonic theory of housing markets abstract in this paper the hedonic theory of housing markets is used to generate a multinomial logit model of household behavior in an urban housing market application of hedonic theory to housing markets is by now fairly familiar and a link to multinomial logit has also been established however by emphasizing more heavily the bid price interpretation of hedonic theory this paper develops a new connection to econometric estimation that essentially involves running the usual logit equations in reverse one advantage of this approach is that the link between the logit equations and hedonic theory involves bid price rather than utility functions and this in turn permits the empirical results to be given an extremely clear interpretation furthermore in contrast to the standard logit model the extreme value distribution required to justify the estimation technique emerges endogenously as part of the analysis

a nested logit migration model with selectivity in this paper we specify a multiple choice migration model with selectivity we estimate this model using observations on individuals drawn from the 1971 census of venezuela there are two main innovations in this paper we apply a correction for the presence of selectivity in wage equations in the context of a multiple choice migration model and we apply a less restrictive technique for modelling multiple discrete choices than in previous studies we study the choices of individuals among 23 states of venezuela each individual is observed to have chosen one state so one wage is observable per person our hypothesis is that individuals choose where to locate on the basis of an evaluation of costs and benefits associated with choosing each state we measure the benefits associated with choosing a given state by means of the wage a person could earn in this state since we observe only one wage for each person we have to impute the unobserved wages for the states this person did not choose in order to study the role of wages in migration however it is possible that unobserved factors which affect both an individual s choice of location and his wages may result in sample selection bias if we try to estimate state specific wage equations by ols on the basis of the self selected samples we apply an estimator proposed by lee 1983 to estimate state specific wage equations free from sample selection bias the wage equations permit us to investigate whether individuals who choose particular states earn different wages from observationally identical individuals drawn from the population at random in the context of a developing country where internal migration flows are large evidence on the selectivity of migration will enhance our understanding of an important labor market adjustment mechanism evidence that people who choose particular locations earn more in those locations than would observationally identical individuals drawn at random from the population positive selection will suggest that migration decisions are made according to the principle of comparative advantage in modelling the choice of location we test whether subsets of states are more highly similar to each other than to other states unobserved similarities between states may arise because of similar amenities or economic conditions which are not otherwise explicitly controlled for in the model we implement the

analysis of urban land shortages the case of korean cities both natural constraints and government regulations on urban land use can cause urban land shortages and hence higher prices of urban land and housing than otherwise there have been attempts to investigate the differential effects of natural and contrived restrictions on land price for w x example rose 10 found that natural constraints have a significant positive impact on land value while monopoly zoning power makes a smaller contribution in explaining inter city variations in urban land price w x on the other hand pollakowski and wachter 8 analyzed the impact of land use controls measured by an index of restrictiveness of zoning and confirmed that land use regulations raise the prices of housing and developed land to the best knowledge of the authors however none of the published empirical studies including the two cited above actually measure the amount of shortage of urban land at the city level instead land supply variables are employed together with demand variables such as income and population size to determine their impact on land or housing prices this study seeks to fill the gap in the literature first by developing a measure of the urban land shortagersurplus from an analysis of land price

salaried employment and earnings in indonesia new evidence on the selection bias this article uses household survey data to estimate the determinants of earnings in indonesia a country where nonsalaried work is widespread and earnings data are available for salaried employees only we deal with the selection bias by estimating a full information maximum likelihood fiml system of equations where selection into the labour market is modelled in a multinomial setting we find that some estimated parameters of the earnings equation differ from a binomial selection procedure by heckman 1979 in particular for those variables with the strongest impact on the selection into the different labour market statuses however the estimated returns to education are unaffected even when we deal with the endogeneity of educational attainment following duflo 2001 overall our findings show that the choice of the selection rule affects the estimates of the earnings determinants in the indonesian labour market

the rent gradient for manufacturing abstract rent gradients for manufacturing are estimated using actual rent and value figures for cincinnati distance to the city center is found to be of no importance in explaining rent or value variations

federal reserve information and the behavior of interest rates this paper tests for the existence of asymmetric information between the federal reserve and the public by examining federal reserve and commercial inflation forecasts it demonstrates that the federal reserve has considerable information about inflation beyond what is known to commercial forecasters it also shows that monetary policy actions provide signals of the federal reserve s information and that commercial forecasters modify their forecasts in response to those signals these findings may explain why long term interest rates typically rise in response to shifts to tighter monetary policy jel e52 e43 d82 asymmetric information between the federal reserve and the public is a phenomenon that is often posited but rarely tested numerous models of central bank behavior for example show that the existence of asymmetric information has important implications for the effectiveness of policy and the consequences of dynamic inconsistency yet there

the role of explanations and need for uniqueness in consumer decision making unconventional choices based on reasons this research investigates the interaction between a very common task explaining decisions and an individual difference need for uniqueness nfu on buyer decision making we propose that explaining or providing reasons for decisions shifts the focus from the choice of options to the choice of reasons furthermore buyers who explain their decisions and have high nfu tend to select unconventional reasons and are consequently more likely to make unconventional choices these predictions were supported in a series of studies involving choices between conventional and less conventional options such as whether to switch to a brand on sale whether to select a compromise option and whether to accept a gamble with a possible loss the findings also indicate that the effects of providing reasons are not due to attempts to act rationally or to concerns about being evaluated three boundary conditions on the generalization that high nfu consumers who provide reasons tend to make unconventional choices we

the identification of urban employment subcenters abstract the purpose of this paper is to propose empirical criteria for the identification of urban employment subcenters it is suggested that gross employment density employment divided by total land area and the employment population ratio are the best measures to identify an urban zone as an employment subcenter these measures are used to identify employment subcenters in the chicago smsa in 1970 and previous studies of housing and land prices in chicago are reviewed

overlapping neighborhoods and housing externalities abstract this paper explores the roles of distance and feedback in neighborhood effects conventional models employ positive feedback and feature neighborhoods that stand apart like islands when neighborhoods overlap a change in land use in one location can induce changes in land use across the city furthermore equilibrium land use is unlikely to be symmetric with negative feedback indirect neighborhood effects can lead to comparative static changes in density and price that cycle these cycles can reduce the ability of coarse zoning to achieve an optimum and can make measurement of neighborhood effects a difficult undertaking

does it pay to attend an elite private college cross cohort evidence on the effects of college type on earnings although a substantial and rising labor market premium is associated with college attendance in general little is known about how this premium varies across institutions of different types and across time in this paper we explicitly model high school students choice of college type characterized by selectivity and control based on individual and family characteristics including ability and parental economic status and an estimate of the net costs of attendance we estimate selectivity corrected outcome equations using data from both the national longitudinal study of the high school class of 1972 and high school and beyond which permit us to determine the effects of college quality on wages and earnings and how this effect varies across time even after controlling for selection effects strong evidence emerges of a significant economic return to attending an elite private institution and some evidence suggests this premium has increased over time

a selectivity model of employer size wage differentials this article investigates wage differentials for employees of different size firms utilizing an econometric methodology that allows the size of employer to be treated as endogenous in the context of discrete ordered employer size data as a result we are able to estimate i employer size wage gaps which are corrected for selectivity bias and ii the magnitude and direction of the selection bias decompositions of the resulting wage differentials are computed with comparisons of the conditional on sorting across employer size and unconditional wage gaps

public private employment choice wage differentials and gender in turkey abstract the main objective of this article is to examine the factors that explain the employment choice and the wage differentials in public administration state owned enterprises and the formal private wage sector in turkey selectivity corrected wage equations are estimated for each sector for men and women separately oaxaca blinder decomposition of the wage differentials between sectors by gender and between men and women by sector are carried out results indicate that when controlled for observed characteristics and sample selection for men public administration wages are higher than private sector wages except at the university level where the wages are at par state owned enterprise wages for men are higher than private sector wages similar results are obtained for women further while the wages of men and women are at parity in the public administration there is a large gender wage gap in the private sector in favor of men private returns to schooling are found to be lower in the noncompe

modelling intrametropolitan location of foreign investment firms in a chinese city foreign direct investment fdi is now becoming a driving force for world wide urban structuring very few studies have been made at the intrametropolitan scale of industrial location in post socialist cities studies at a regional scale have generally emphasised the peculiar nature of fdi and have resorted to the description of special factors such as kinship ties and social networks to explain fdi location processes in contemporary urban china with the aid of gis techniques this study geo located fdi firms through their postal codes and measured the site characteristics through cross referencing location factors presented in the coverage such as infrastructure and land use this study used logistic regressions to examine how site attributes influence the popularity of a development site the results suggest that intraurban fdi firm location can be explained by the location advantages prevailing at development sites among which highway accessibility the access to major high ranking hotels and the status of the economic and technological development zone etdz are important determinants in addition to conventional location factors such as access to railway terminals agglomeration economies and labour markets the implications of fdi location for the urban spatial structure are profound first fdi has transformed the function of the city centre for example an emerging cbd secondly the intrametropolitan distribution of fdi has triggered polycentric urban growth in chinese cities

factors affecting commercial land values an empirical study of milwaukee wisconsint this paper uses an implicit market approach to model the highest and best use concept when applied to single family residential development formulated from the landowner s perspective this persistence forecasting model relies on the theory that the

selection bias and land development in the monocentric city model the land development process implied by the monocentric city model is extremely simple the model as set forth by muth 13 and mills 12 contains no error terms and the city lies on a featureless plain land is converted to urban use whenever urban land values rise relative to agricutural land values the assumptions of the model assure that land development in any period takes place in a ring at the edge of the city in this paper we relax the assumption that the city is a featureless plain by introducing error terms to the urban and non urban land value functions this simple addition a necessity for empirical work produces a much richer land development process than is imbedded in the simple muth mills model the error terms in the land value functions which represent the effects of missing variables such as the fertility of the soil influence the selection of land for urban and non urban use this selection process in turn causes a bias in ols estimates of land value functions the form of the selection bias implies three possible land development patterns first if traits that produce high urban land values cause low non urban values relatively low value non urban land is developed first and has above average value in urban use however if unusually productive agricultural land is also highly valued in urban use then the development process depends on the relative magnitudes of the variances of the two land value distributions for example if the variance of the urban distribution is the larger then relatively high value non urban land is developed first and has above average land value in urban use the greater variance in the urban distribution implies that unusually good farmland can earn more in urban use thus the expanded muth mills model incorporates urban expansion at the expense of high quality agriculture and a more benign land market in which only comparatively low quality agricultural land is taken by cities the expanded muth mills model implies the existence of selection bias in land value equations selection bias has only recently been recognized

actively learning by pricing a model of an experimenting seller this article presents a model of a rational seller who is actively learning the slope of his demand curve via his pricing strategy consequently this seller optimally experiments with his price resulting price patterns show a tendency for discreteness as observed in the data which has proved to be a major challenge to most price setting models the experimentation motive can also replicate the observation that prices are more volatile than costs as well as the presence of many idiosyncratic price changes in the data it can do so without a need to assume the existence of large idiosyncratic shocks

mobility and the return to education testing a roy model with multiple markets self selected migration presents one potential explanation for why observed returns to a college education in local labor markets vary widely even though u s workers are highly mobile to assess the impact of self selection on estimated returns this paper first develops a roy model of mobility and earnings where workers choose in which of the 50 states plus the district of columbia to live and work available estimation methods are either infeasible for a selection model with so many alternatives or place potentially severe restrictions on earnings and the selection process this paper develops an alternative econometric methodology that combines lee s 1983 parametric maximum order statistic approach to reduce the dimensionality of the error terms with more recent work on semiparametric estimation of selection models e g ahn and powell 1993 the resulting semiparametric correction is easy to implement and can be adapted to a variety of other polychotomous choice problems the empirical work which uses 1990 u s census data confirms the role of comparative advantage in mobility decisions the results suggest that self selection of higher educated individuals to states with higher returns to education generally leads to upward biases in ols estimates of the returns to education in state specific labor markets while the estimated returns to a college education are significantly biased correcting for the bias does not narrow the range of returns across states consistent with the finding that the corrected return to a college education differs across the u s the relative state to state migration flows of college versus high school educated individuals respond strongly to differences in the return to education and amenities across states

hedonic housing price indices and secondary employment centers the monocentric model of the city concludes that the price of housing services varies inversely with travel time to the central business district cbd holding location specific amenities constant because households lower their bid prices for housing as commutation cost increases indeed residential locational equilibrium in the monocentric city requires a negative price gradient however empirical testing has revealed at best lukewarm support for the negative price gradient 2 for example estimates of hedonic housing price indices by berry 3 and daniels 4 yield statistically significant positive relationships between price and distance or travel time to the cbd while kain and quigley 6 lapham 7 and thaler 14 find no statistically significant relationship the lack of consistent empirical support for a monotonically negative price gradient need not be disturbing if the city violates the assumptions of the monocentric city model specifically secondary employment centers could cause the price gradient from the cbd eventually to become positive and achieve a local maximum in the neighborhood of the secondary center failure to control for distance or travel time to secondary centers may explain positive and statistically insignificant negative price gradients that

employment decentralisation polycentricity or scatteration the case of barcelona at the present time most large cities in the world are polycentric and at the same time they are undergoing processes of employment decentralisation and deconcentration it has been argued that polycentricity is just an intermediate stage between monocentricity and a more unstructured chaotic and amorphous location model scatteration for the case of the polycentric barcelona the aims of this study are to test whether its employment is moving from polycentricity to scatteration and whether its employment location model is increasingly random and unstructured the results show that in spite of the decentralisation and deconcentration processes employment concentrated in centres still represents a significant percentage of total employment and new sub centres have emerged in the periphery what is more the results also show an increasing influence of employment sub centres on employment location and density conditions as a result polycentricity has been reinforced

the role of market efficiency intuitions in consumer choice a case of compensatory inferences abstract the authors examine consumer inferences about product attributes that are unobservable at the time of the decision extant research predicts that in the absence of an explicit correlation between product attributes consumers will infer that the brand that is superior on the observable attributes is also superior on the unobservable attributes the authors propose an alternative inference strategy that makes the counterintuitive prediction that the apparently superior brand is inferior on the unobservable attributes the authors refer to these inferences as compensatory inferences and assert that they are associated with consumers intuitive theories about the competitive nature of a market in a series of four experiments the authors examine the occurrence of compensatory inferences and compare them with other inference strategies

swings in commercial and residential land prices in the united states abstract we use a large dataset of land sales dating back to the mid 1990s to construct land price indexes for 23 msas in the united states and for the aggregate of those msas the price indexes show a dramatic increase in both commercial and residential land prices over several years prior to their peak in 2006 2007 and a steep descent since then these fluctuations have exceeded those in well known indexes of home prices and commercial real estate prices because those indexes price a bundle of land and structures this comparison implies that land prices have been more volatile than structures prices over this period this result is a key element of the land leverage hypothesis which holds that home prices and commercial property prices will be more volatile all else equal in areas where land represents a larger share of real estate value

an analysis of minimum frontage zoning to preserve lakefront amenities the development of lakefront property in northern wisconsin has prompted in several towns minimum frontage zoning stricter than the state standard such zoning generates an economic loss by constraining development development effect and an economic gain by preserving environmental amenities amenity effect estimation of a hedonic price function for lakefront property in northern wisconsin quantifies these competing effects the estimation indicates that at the current margin the economic loss from the development effect is negligible and the economic gain from the amenity effect may be considerable raising frontage prices by an average of 21 5

indeterminacy and forecastability recent studies document the deteriorating performance of forecasting models during the great moderation this conversely implies that forecastability is higher in the preceding era when the economy was unexpectedly volatile we offer an explanation for this phenomenon in the context of equilibrium indeterminacy in dynamic stochastic general equilibrium models first we analytically show that a model under indeterminacy exhibits richer dynamics that can improve forecastability then using a prototypical new keynesian model we numerically demonstrate that indeterminacy due to passive monetary policy can yield superior forecastability as long as the degree of uncertainty about sunspot fluctuations is relatively small

hedonic prices demands for urban housing amenities and benefit estimates abstract this paper uses a rosen two step hedonic price trait demand approach to estimate demand functions for a vector of urban amenities to ascertain whether this theoretically preferred approach yields benefit estimates which differ from the oft used ridker henning one step hedonic approach we conduct a sensitivity analysis we find that the two step approach does yield different benefit estimates and that the differences are large for some amenities the estimates are sensitive to the functional form of the hedonic equation when the forms are significantly different according to modified box cox results but are not particularly sensitive to specification of the amenity demand equation

non graduation and the earnings function an inquiry on self selection abstract we model schooling careers in the dutch educational systems including the decision to drop out as a discrete sequential choice in which expected earnings play an important role selectivity biasd from correlation between the errors in the decision function and the earnings function appears empirically relevant and we correct for it by applying a proper maximum likelihood estimation procedure the results indicate that drop outs behave differently from graduates in the decision functions on schooling careers expected earnings based on estimated earnings functions in mid career are never significant yet the educational choices appear ex post consistent with choices according to comparative earnings advantage

the determinants of nonresidential urban land values abstract this paper presents the results of an empirical study of nonresidential urban land values in the dallas metropolitan area the data base consists of 467 vacant land transactions from 1978 to 1982 by concentrating on sales prices of vacant land rather than improved property problems normally encountered from use of appraised values or improved properties are eliminated separate models are developed for industrial commercial and office land the study focuses on the tendency toward agglomeration for consumers of each land use as measured by the impact on land values in the central business district suburban nodes and other employment concentrations the results provide insight into a number of influences on urban land value and offer evidence that office land derives greater benefit from agglomeration than does commercial or industrial land

multiple regime bid rent function estimation abstract this paper reviews estimators for multiple regime selection models which include the standard urban bid rent model as a special case 4 probabilistic bid rent model imposes a restrictive selection process while existing two stage multiple regime estimators assume an error structure that is inconsistent with bid rent theory monte carlo experiments demonstrate that two stage estimators are accurate and robust to distributional misspecification the practical usefulness of the estimators is illustrated using data on 1920s chicago land values

the structure of urban land prices abstract recognition of the existence of nonlinear land prices has an impact on the measurement of the rate at which land price declines with distance from the urban center it is hypothesized that concave parcel prices have given rise to overly large estimates of the rate of price decline with distance because parcel sizes increase with distance and increased parcel sizes would be associated with lower unit prices as a result of the concavity of the land price function this hypothesis is empirically tested using vacant residential commercial and industrial land sales from within cook county illinois an important finding is that allowing for concavity greatly reduces although it does not eliminate measured rates of price decline with distance

monetary policy in a data rich environment abstract most empirical analyses of monetary policy have been confined to frameworks in which the federal reserve is implicitly assumed to exploit only a limited amount of information despite the fact that the fed actively monitors literally thousands of economic time series this article explores the feasibility of incorporating richer information sets into the analysis both positive and normative of fed policymaking we employ a factor model approach developed by stock j h watson m w diffusion indices journal of business economic statistics 2002 20 2 147 forecasting inflation 1999 journal of monetary economics 44 2 293 that permits the systematic information in large data sets to be summarized by relatively few estimated factors with this framework we reconfirm stock and watson s result that the use of large data sets can improve forecast accuracy and we show that this result does not seem to depend on the use of finally revised as opposed to real time data we estimate policy reaction functions for the fed that take into account its data rich environment and provide a test of the hypothesis that fed actions are explained solely by its forecasts of inflation and real activity finally we explore the possibility of developing an expert system that could aggregate diverse information and provide benchmark policy settings

a comment on zoning returns to scale and the value of undeveloped land this paper revisits the relationship between land value and parcel size the authors demonstrate that using a simple arbitrage equilibrium argument the value size relationship is convex concave whenever land assembly subdivision is possible they also explore further the impact of zoning on market outcomes copyright 1993 by mit press

has euro area inflation persistence changed over time this paper analyzes the stability over time of the econometric process for euro area inflation since 1970 focusing in particular on the behavior of the so called persistence parameter the sum of the coefficients on the lagged dependent variables perhaps surprisingly in light of the lucas critique our principal finding is that there appears to be relatively little instability in the parameters of the euro area inflation process full sample estimates of the persistence parameter are generally close to 1 and we fail to reject the hypothesis that this parameter has been stable over time we discuss how these results provide some indirect evidence against rational expectations models with strong forward looking elements such as the new keynesian phillips curve

theory and estimation in the economics of housing demand the main purpose of this paper is to review recent theoretical and empirical developments in the economics of housing demand in particular we ask what is known concerning the permanent income elasticity of housing demand vis a vis the current or measured income elasticity what is known concerning price elasticities what is the appropriate functional form for housing demand equations what is the role of demographic variables what is known concerning dynamic aspects of housing demand what appear to be the major sources of bias in existing estimates of demand equations

multiproduct pricing in major league baseball a principal components analysis the empirical analysis of multiproduct pricing suffers from a lack of clear theoretical guidance and appropriate data limitations which often render traditional regression based analyses impractical this paper analyzes ticket parking and concession pricing in major league baseball for the period 1991 2003 using a new methodology based on principal components which allows inferences to be formed about the factors underlying price variation without strong theoretical guidance or abundant information about costs and demand while general demand shifts are the most important factor they explain only half of overall price variation also important are price interactions that derive from demand interrelationships between goods and the desire to maximize the capture of consumer surplus in the presence of heterogeneous demand

an analysis of public and private sector wages allowing for endogenous choices of both government and union status a general selection model is estimated in which workers select across four labor markets private nonunion private union public nonunion and public union evidence is found of positive selection bias in the private nonunion sector and of negative selection bias in the public union sector union wage differentials in the public and private sectors as well as public private wage differentials are then calculated two different types of wage differentials are contrasted we discuss when it is appropriate to use each type of differential

land use regulations and regional economic development this paper uses a data intensive computable general equilibrium cge model of a medium sized city with integrated commercial and residential land data to analyze changes to local land use regulations via changes in land supply elasticities on economic development measures employment household income housing prices and tax revenue under various types of regional growth that originate from different local sectors the cge framework overcomes difficulties of econometric modeling in this area namely measurement consistency impact isolation and endogeneity issues the results both link the sparse work in this area and provide a systematic analysis including marginal and total impacts

title systems and land values abstract the torrens or registration and the recording title systems apply different principles to resolve conflicting claims to land title this paper develops a theoretical model of how expected title risk and transactions costs affect land value across the two systems and ultimately concludes that the torrens system leads to higher property values ceteris paribus it also suggests that empirical studies of the title system land value nexus need to control for self selection effects in the data we use the simultaneous existence of two alternative title systems in cook county illinois as a natural experiment for comparing land values under each system the estimates indicate that the torrens system increases land value relative to the recording system when controlling for self selection effects

money isn t everything but it helps if it doesn t look used how the physical appearance of money influences spending despite evidence that currency denomination can influence spending researchers have yet to examine whether the physical appearance of money can do the same this is important because smaller denomination bills tend to suffer greater wear than larger denomination bills using real money in the context of real purchases this article demonstrates that the physical appearance of money can override the influence of denomination the reason being people want to rid themselves of worn bills because they are disgusted by the contamination from others whereas people put a premium on crisp currency because they take pride in owning bills that can be spent around others this suggests that the physical appearance of money matters more than traditionally thought and like most things in life it too is inextricably linked to the social context the results suggest that money may be less fungible than people think

evaluating the efficiency of the fomc s new economic projections since 2007 fomc policymakers have been publishing detailed numerical projections of macroeconomic series over the next three years by testing whether the revisions to these projections are unpredictable i find that fomc s efficiency is generally accepted for inflation but often rejected for real economic variables notably for the unemployment rate the rejection is due to the strong autocorrelation of revisions which may reflect information rigidity of fomc s unemployment projections the joint efficiency of the entire projection is accepted in most cases

do liquidation values affect financial contracts evidence from commercial loan contracts and zoning regulation we examine the impact of asset liquidation value on debt contracting using a unique set of commercial property loan contracts we employ commercial zoning regulation to capture the flexibility of a property s permitted uses as a measure of an asset s redeployability or value in its next best use within a census tract more redeployable assets receive larger loans with longer maturities and durations lower interest rates and fewer creditors controlling for the property s type sale price and earnings to price ratio these results are consistent with incomplete contracting and transaction cost theories of liquidation value and financial structure

on the possibility and optimality of positive rent gradients abstract the assertion that externalities from low density can create positive residential rent gradients is examined in several cases optimal externality internalization zoning excessive and insufficient restriction and no internalization in all cases positive rent gradients are unlikely i e require land to be an inferior good unstable or impossible in addition easily interpretable welfare conditions are found as a result of consumer and social welfare maximization the alonso muth mills model is found to be quite robust

growth population and industrialization and urban land expansion of china china is experiencing urbanization at an unprecedented rate over the last two decades the overall goal of this paper is to understand the extent of and the factors driving urban expansion in china from the late 1980s to 2000 we use a unique three period panel data set of high resolution satellite imagery data and socioeconomic data for entire area of coterminous china consistent with a number of the key hypotheses generated by the monocentric model our results demonstrate the powerful role that the growth of income has played in china s urban expansion in some empirical models the other key variables in the monocentric model population the value of agricultural land and transportation costs also matter adapting the basic empirical model to account for the environment in developing countries we also find that industrialization and the rise of the service sector appear to have affected the growth of the urban core but their role was relatively small when compared to the direct effects of economic growth we also make a methodological contribution demonstrating the potential importance of accounting for unobserved fixed effects

desire to acquire powerlessness and compensatory consumption three experiments examine how power affects consumers spending propensities by integrating literatures suggesting that a powerlessness is aversive b status is one basis of power and c products can signal status the authors argue that low power fosters a desire to acquire products associated with status to compensate for lacking power supporting this compensatory hypothesis results show that low power increased consumers willingness to pay for auction items and consumers reservation prices in negotiations but only when products were status related the link between powerlessness and compensatory consumption has broad implications both for consumers health and well being and for understanding the psychological state of power

a cross country comparison of seasonal cycles and business cycles in a recent paper barsky and miron 1989 examine the seasonal fluctuations in the u s economy they show that the key stylized facts about the business cycle characterize the seasonal cycle as well and they suggest that the interpretation of many of these stylized facts over the seasonal cycle is easier than interpretation over the business cycle the reason is that the ultimate sources of seasonal cycles are more readily identifiable than those of business cycles this paper uses the cross country variation in seasonal patterns to pin down the ultimate sources of seasonal variation more precisely than is possible from examination of u s data alone we conclude that a christmas shift in preferences and synergies across agents are the key determinants of the seasonal patterns around the world the paper also establishes that across developed countries the key observations about aggregate variables that characterize the business cycle also characterize the seasonal cycle thus the similarity of the seasonal cycle and the business cycle demonstrated by barsky and miron 1989 for the united states is a robust stylized fact this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item

zoning returns to scale and the value of undeveloped land when land markets are incomplete parcels can be scaled to make control compatible with use and to internalize externalities the authors show that an arbitrage proof equilibrium implies an increasing and strictly concave relationship between the value and size of land parcels undeveloped land sales in southern california strongly confirm the theoretical relationship the authors find that zoning primarily restricts the conversion of land from agriculture to residential and industrial uses relative to the competitive equilibrium the scale of land units is an effective private instrument for providing compatible land use even in the presence of strong zoning copyright 1991 by mit press

using quantile smoothing splines to identify employment subcenters in a multicentric urban area abstract the goal of this paper is to provide a statistically based definition of employment subcenters for multicentric urban areas in particular we examine the shape of the employment density function using quantile smoothing splines as a nonparametric empirical specification this approach allows inspection of the employment gradient at the upper tail rather than the center of the employment density distribution as a result our definition of employment subcenters extends previous work as it allows us to condition on distance from the central business district relies on the extent to which a subcenter influences surrounding areas yet still emphasizes areas with high employment densities

nowcasting u s headline and core inflation we propose a new and parsimonious model for nowcasting headline and core inflation in the u s price index for personal consumption expenditures pce and the consumer price index cpi

determinants of local public policies for farmland preservation and urban expansion a french illustration we outline the determinants of local public policies for farmland preservation and urban expansion we first rely on the literature and on a purposely designed field study of municipalities in southern france to propose a theoretical framework better suited to the french situation the model considers aspects of land consumption includes two interest groups as well as the median voter and is then econometrically tested we confirm the expected effects of certain sociodemographic determinants and highlight the impact of municipal budgetary considerations and the role of the agricultural sector we also find more counterintuitive determinants like local political regime or unbalanced neighboring relationships

spatial impacts local labour market characteristics and housing prices this paper takes as a starting point a model where spatial variation in housing prices is explained by urban attraction and labour market accessibility effects using data from a region in south west norway estimation results are found to be encumbered however with significant spatial effects the spatial durbin model is used to account for this and to provide estimates of direct and indirect impacts in addition hypotheses are tested that some of the spatial variation in housing prices reflects local labour market characteristics some support is found for a hypothesis that a model specification should account for sub centres located at some distance from the central parts of the region the indirect impacts estimated in the spatial durbin model suggest that spatially related misspecifications of implicit elasticities in the ordinary least squares model are mainly due to negative externalities close to areas of high labour market accessibility