income distribution in agriculture a unified approach this paper develops a class of partial equilibrium models capable of analyzing in a unified way a number of market transmitted distributional consequences of a variety of exogenous shocks in agriculture the shocks include technical change neutral or biased changes in the supply of agricultural inputs or in the demand for agricultural outputs and government interventions the models accommodate more than two primary factors of production and more than one region with or without constraints on factor mobility

factor productivity and income inequality a general equilibrium analysis economic growth over the past two decades has failed to reduce income inequality we contend that major reasons for this are the slowdown and bias in technological change productivity growth given the complexity of the many interactions that take place this phenomenon is best addressed in a general equilibrium context for this purpose we have developed a computable general equilibrium cge model with advanced features relating to income distribution we perform a series of simulations based on recent overall productivity changes but under various forms of technological change bias factor mobility and government budgetary balance we find the labour augmenting technological change cases to be most consistent with recent experience

information acquisition and under diversification if an investor wants to form a portfolio of risky assets and can exert effort to collect information on the future value of these assets before he invests which assets should he learn about the best assets to acquire information about are ones the investor expects to hold but the assets the investor holds depend on the information he observes we build a framework to solve jointly for investment and information choices with general preferences and information cost functions although the optimal research strategies depend on preferences and costs the main result is that the investor who can first collect information systematically deviates from holding a diversified portfolio information acquisition can rationalize investing in a diversified fund and a concentrated set of assets an allocation often observed but usually deemed anomalous copyright wiley blackwell

modern rice technology and regional wage differentials in the philippines abstract fear has been widely expressed that the modern rice varieties have created large disparities in regional income distribution as the productivity gap between favorable and unfavorable rice production environments widened due to differential technology adoption throughout south and southeast asia over the last two decades technology affects the income of farm population directly through its effects on productivity and factor use and indirectly through its effect on factor prices in particular the ultimate distributional impact of modern varieties will critically depend on the interregional labor market adjustments through migration in response to regional wage differentials created by the differential technology adoption since labor is the main resource of the majority of the rural population we studied favorable and unfavorable rice growing villages in the philippines and found that adoption of modern varieties during the 1970s was positively related to population growth rate contrary to popular belief no association was observed between wage rates and adoption of modern varieties as of 1986 these findings support the hypothesis that the differential adoption of modern rice varieties induced interregional labor migration toward equalization of wage income across different production environments

rural income dynamics and poverty reduction in thai villages from 1987 to 2004 this article aims to examine the factors contributing to the increase in household income and the corresponding reduction in poverty in rural thai villages from 1987 to 2004 by employing household panel data it is found that there has been a significant structural shift of household income away from farm to nonfarm income sources as well as a reduction in the income gap and the difference in poverty incidence between favorable and unfavorable regions such decreases in poverty and its regional gap have been associated with the declining importance of income accrued to farm land measured by farm size and the availability of irrigation and with the increasing importance of human capital measured by the proportion of working members who have graduated from post lower secondary schools such findings indicate that the success in rural poverty reduction in thailand has resulted from the development of the rural nonfarm sector coupled with the improvement of the schooling levels of the rural population

green revolution land reform and household income distribution in the philippines income of agricultural households consists of returns to labor capital and land from farming supplemented mainly by labor earnings from nonfarm sources agricultural technology affects farmers income through its effect on factor demands and factor prices which in turn induce changes in the allocation of farmers own resources to different uses income from farming is also affected by village institutions such as land tenure which governs the distribution of income between landlords and tenants as well as resource allocations

imperfect choice or imperfect attention understanding strategic thinking in private information games to understand the thinking process in private information games we use mousetracking to record which payoffs subjects attend to the games have three information states and vary in strategic complexity subjects consistently deviate from nash equilibrium choices and often fail to look at payoffs which they need to in order to compute an equilibrium response choices and lookups are similar when stakes are higher when cluster analysis is used to group subjects according to lookup patterns and choices three clusters appear to correspond approximately to level 3 level 2 and level 1 thinking in level k models and a fourth cluster is consistent with inferential mistakes as for example in qre or cursed equilibrium theories deviations from nash play are associated with failure to look at the necessary payoffs the time durations of looking at key payoffs can predict choices to some extent at the individual level and at the trial by trial level

racial discrimination in the labor market theory and empirics we review theories of race discrimination in the labor market taste based models can generate wage and unemployment duration differentials when combined with either random or directed search even when strong prejudice is not widespread but no existing model explains the unemployment rate differential models of statistical discrimination based on differential observability of productivity across races can explain the pattern and magnitudes of wage differentials but do not address employment and unemployment at their current state of development models of statistical discrimination based on rational stereotypes have little empirical content it is plausible that models combining elements of the search models with statistical discrimination could fit the data we suggest possible avenues to be pursued and comment briefly on the implication of existing theory for public policy jel j15 j31 j64 j71

the economic consequences of productivity changes a computable general equilibrium cge analysis cutler h and davies s the economic consequences of productivity changes a computable general equilibrium cge analysis regional studies this paper uses a data intensive cge model to examine sector specific impacts of increases in total factor productivity and labour and capital productivity it focuses on the importance of a sector s output in household consumption and firms intermediate input demand the importance of labour and capital in value added and the impact on the city s consumer price index cpi as factors influencing the transmission mechanism the general equilibrium effects result in unambiguous increases in household migration for total factor productivity and capital productivity but not for the labour case this analysis emphasizes the impact on household income and tax revenue per new household cutler h et davies s les consequences economiques des changements de productivite une analyse egc regional studies cet article utilise un modele d equilibre general calculable egc

the economics of franchise contracts as an organizational arrangement the franchise contract lies between anonymous price mediated exchange and centralized intrafirm employment in contrast to conventional market exchange franchise contracts typically impose on franchisees retail quality standards common hours of business price controls and nonlinear payment schedules for example fixed initial royalty fees plus a percentage of gross retail revenues while franchisors typically provide national advertising and training programs monitor and inspect the franchisees performance with varying intensity across industries and hold the residual power to terminate the franchise agreement observations of actual terminations indicate that franchisors sometimes exclude this power franchisors sometimes face persistent queues of potential franchisees in contrast to simple employment contracts franchise agreements provide for sharing of profits through royalties on revenue or output and considerable freedom for independent decisions by local franchisees 1 why do these franchise contracts exist

simple market equilibria with rationally inattentive consumers we study a market with rationally inattentive consumers who are unsure of the terms of the offers made by firms but can acquire information about the terms at a cost in a symmetric equilibrium the price set by firms is continuously increasing in the cost of information for consumers and decreasing in the number of firms operating in addition favorable a priori information about a firm leads it to set a higher price and a new entrant can increase demand for incumbents when consumers have heterogeneous costs of information firms selling low quality products may choose to set the highest prices

intergenerational transfers in philippine rice villages gender differences in traditional inheritance customs abstract this paper examines education land and nonland asset transfers from parents to children in five rice villages in the philippines a model with family fixed effects explains transfers better than either individual heterogeneity or observed parent and child characteristics without family fixed effects families facing different land constraints exhibit significantly different patterns of educational investment in children in a subsample with completed inheritance daughters receive less education land and total inheritance but are compensated with nonland assets parents also exhibit preferential behavior towards children of the same gender daughters of better educated mothers receive more land nonland assets and total inheritance better educated fathers give land preferentially to sons but favor daughters in education

theories of share tenancy a critical survey for the past 2 decades the problems of agricultural tenancy have attracted a great deal of attention not only from agricultural economists but also from economists in general as a typical example of agencyprincipal contract relations despite the prolific growth of literature both theoretical and empirical there has been little convergence in opinions on tenancy contracts the divergence has been especially great on the understanding of the causes and the effects of sharecropping tenancy much confusion underlying the widely divergent perspectives has stemmed from partial treatments of contractual choice which unduly limit the optimizing behavior of contracting parties and the options of contract forms this essay aims at clarifying the sources of the confusion by reviewing the past literature in light of the more general theory of agency principal relations the agency theory in order to examine the problems of various theoretical models in a unified framework in section ii we first develop the basic framework of a general model of tenancy contract in section iii we clarify in terms of the general model contradictions latent in the traditional marshallian theory which asserts that share tenancy is inefficient because of the disincentive effect of cropsharing on the tenant s work effort in section iv we attempt to show that recent efforts to reconstruct the theory based on the traditional assumption have not yet been quite successful section v draws implications and testable hypotheses from more general theories incorporating the aspects of risk and uncertainty section vi tests allocational and distributional implications of those alternative hypotheses based on the summary of evidence col

coexistence of strategic vertical separation and integration abstract this paper gives conditions under which vertical separation is chosen by some upstream firms while vertical integration is chosen by others in the equilibrium of a symmetric model a vertically separating firm trades off fixed contracting costs against the strategic benefit of writing a two part tariff exclusive dealing contract with its retailer coexistence emerges when more than two vertical cournot oligopolists supply close substitutes when vertical integration and separation coexist welfare could be improved by reducing the number of vertically separating firms the scope for coexistence diminishes when assumptions on contract observability and commitment are relaxed

determinants and consequences of land reform implementation in the philippines abstract unlike the experience of other developing countries land reform in the philippines has been successful in converting many of share tenants to land reform beneficiaries this study indicates that the implementation of land reform is positively associated with yield growth made possible by the adoption of modern seed fertilizer technology a major reason underlying such association is considered to be an increased economic interest of tenants in land reform arising from divergence of rental value of land from leasehold rent and amortization fees prescribed by law

territorial restrictions in franchise contracts i introduction efficient contracts establish the incentives for contractual parties through the assignment of rights or authority over decisions as well as shares of profit this insight has been widely used to explain the nature of the firm 1 the role of rights assignment in explaining specific business contracts however is relatively unexplored here we analyze contractual rights within franchise systems focusing on the right to add new franchisees to an existing franchise area the choice in a franchise contract is simple either grant the franchisor the right to add new franchisees in the future or allow existing franchisees the right to block the addition of new outlets the literature on vertical restraints assumes that the restraints specified in contracts are enforced and never renegotiated with respect to territorial exclusivity in particular the literature mainly takes two perspectives territorial protection either prevents franchisor hold up behavior the appropriation of franchisee returns from the investment in establishing the local market or it corrects distortions arising from competition among franchisees 2 our model extends the hold up story by recognizing the dynamic nature of contractual relations between parties contracts are always open for renegotiation and the initial contracts are designed with this in mind the key effect in assigning the right to add additional franchisees is on the status quo point in bargaining subsequent to the initial contract the central point is simple the party with the authority to add franchisees can extract a larger portion of the wealth created by investment in the system incentives depend on the appropriated portion of the return to investment therefore the optimal contract assigns the right to the party whose input is more valuable to the system 3 the next section offers a simple model that develops this theme in a subsequent section we examine some facts about franchise systems in place and illustrate alternative assignments of authority ii the model we consider the simplest franchise contract a franchisor f offers to a franchisee g a contract giving the right to collect profits from the use of the franchisor s brand name in a retail territory we assume that the level of economic profits cannot be verified by a third party such as a court this rules out explicit sharing rules for profits between the two parties 4 these profits depend upon the efforts of both the franchisor and franchisee in developing the market the efforts are undertaken immediately after the contract is signed the franchisee s input represents for example local advertising selling effort or quality and the franchisor s input represents for example national advertising or the maintenance of the brand name the profits from the venture are uncertain and depend on the realization of a draw should the system prove sufficiently successful it may be profitable to add another retail outlet the evolution of contracts will respond to any opportunity for profit enhancement and any restrictions in the initial contract preventing this realization will be open for renegotiation the role for territorial constraints in particular may be illustrated within a simple formal model the effort levels of the franchisor and franchisee are denoted by e sub f and e sub g and are measured in dollars the profits earned from the brand name depend upon a stochastic variable e g demand uncertainty denoted by theta which is realized after the efforts are undertaken after the realization of theta there is an opportunity for the franchisor to sell a position in the territory to a second franchisee a product idea that enjoys success warrants an expanded retail network as the market is mature at this point no further investment is required the key element of the contract for our interest is the allocation of authority over the admission of additional retailers to the territory in question does the contract guarantee to the original franchisee exclusive authority to the use of the brand name in the territory

adoption of agricultural innovations in developing countries a survey this paper reviews various studies which have provided a description and possible explanation to patterns of innovation adoption in the agricultural sector the survey points out that the tendency of many studies to consider innovation adoption in dichotomous terms adoption nonadoption may not be appropriate in many cases where the actual decisions are defined over a more continuous range more attention needs to be given to the socio cultural and institutional environment in area studies so that their interrelation with economic factors affecting adoption can be inferred the presence of several interrelated innovations is another aspect that needs to be considered more carefully in future research since a number of simultaneous decisions may be involved furthermore the possibility of regular sequential patterns in adopting components of a new technological package should be specifically addressed in future studies finally the impact of differential adoption rates on land holding distribution merits attention in future research

exclusive territories and manufacturers collusion this paper highlights the rationale for exclusive territories in a model of repeated interaction between competing supply chains we show that with observable contracts exclusive territories have two countervailing effects on manufacturers incentives to sustain tacit collusion first granting local monopolies to retailers softens competition in a one shot game hence punishment profits are larger thereby rendering deviation more profitable second exclusive territories stifle deviation profits because retailers of competing brands adjust their prices to the wholesale contract offered by a deviant manufacturer whereas intrabrand competition prevents such instantaneous reaction we show that the latter effect tends to dominate thereby making exclusive territories a more suitable organizational mode to cooperate these insights are robust to endogenous communication between manufacturers we also consider retailers service investments here a novel effect emerges that softens the procollusive value of exclusive territories retailers of a deviant manufacturer increase investments which renders deviation more profitable this paper was accepted by preyas desai marketing

neuroeconomic foundations of economic choice recent advances neuroeconomics combines methods and theories from neuroscience psychology economics and computer science in an effort to produce detailed computational and neurobiological accounts of the decision making process that can serve as a common foundation for understanding human behavior across the natural and social sciences because neuroeconomics is a young discipline a sufficiently sound structural model of how the brain makes choices is not yet available however the contours of such a computational model are beginning to arise and given the rapid progress there is reason to be hopeful that the field will eventually put together a satisfactory structural model this paper has two goals first we provide an overview of what has been learned about how the brain makes choices in two types of situations simple choices among small numbers of familiar stimuli like choosing between an apple or an orange and more complex choices involving tradeoffs between immediate and future consequences like eating a healthy apple or a less healthy chocolate cake second we show that even at this early stage insights with important implications for economics have already been gained

pinocchio s pupil using eyetracking and pupil dilation to understand truth telling and deception in sender receiver games we conduct laboratory experiments on sender receiver games with an incentive for senders to exaggerate such as security analyst s painting a rosy picture about earnings prospects our results show that overcommunicati on messages are more informative of the true state than they should be in equilibri um is consistent with a level k model eyetracking shows that senders look much more on the payoff rows corresponding to the true state and much less at receiver payoffs than at their own payoffs senders pupils also dilate more when their deception is larger in magnitude together these data are consistent with the hypothesis that figuring out ho w to deceive another player is cognitively difficult as assumed in the level k mod el a combination of sender messages and lookup patterns predicts the true state about t wice as often as predicted by equilibrium using these measures would enable receiver subjects to hypothetically earn up to 16 21 percent more than they actually do

do landlords discriminate in the rental housing market evidence from an internet field experiment in us cities abstract this paper tests for racial discrimination in the rental housing market using matched pair audits conducted via e mail for rental units advertised on line we reveal home seekers race to landlords by sending e mails from names with a high likelihood of association with either whites or african americans generally discrimination occurs against african american names however when the content of the e mail messages insinuates home seekers with high social class discrimination is non existent racial discrimination is more severe in neighborhoods that are near tipping points in racial composition and for units that are part of a larger building

evaluating the integration of contiguous discontinuous markets this paper applies the concepts of structural models of markets market integration and market discontinuity to show that discontinuous markets alter the integration characteristics of continuous markets when analyzing systems of contiguous markets some of which are discontinuous it appears that the continuous markets are less well integrated when the discontinuous markets are operating than when they are not operating

vertical control and price versus nonprice competition this paper considers a manufacturer distributing a product through retailers who compete in price and service which reduces the time it takes to purchase a good the mix of these instruments that maximizes collective profit is determined by the tastes of consumers on the product margin whereas decentralized retailers consider as well the tastes of consumers on the interretailer margins given search or travel costs consumers with low time costs are overrepresented on the interretailer margins in considering customers on the wrong margin retailers are therefore biased toward price competition this distortion that can be corrected with vertical restraints

green revolution and labour demand in rice farming the case of central luzon 1966 90 while the adoption of modern rice varieties mvs increased labour requirements for crop care and other activities it might have induced the adoption of labour saving technologies thus whether the net impact of mv adoption on labour demand is significantly positive is still debated in the green revolution literature using farm level survey data collected in central luzon from 1966 to 1990 this study estimated simultaneously the labour saving technology adoption and the labour demand functions we found among other things that mvs increased labour demand significantly without inducing the widespread adoption of labour saving technologies

rational inattention and migration decisions abstract acquiring information about destinations can be costly for migrants we model information frictions in the rational inattention framework and obtain a closed form expression for a migration gravity equation that we bring to the data the model predicts that flows from countries with a higher cost of information or stronger priors are less responsive to variations in economic conditions in the various destinations as migrants rationally get less information before deciding where to move the econometric analysis reveals systematic heterogeneity in the pro cyclical behavior of migration flows across origins that is consistent with the existence of information frictions

productivity and the embodiment of technical progress this survey of the issues involved in the embodiment hypothesis that technical change and productivity can be explained by changes in the quality of inputs into the production process treats the interrelationships of technical change and productivity presents some empirical findings on this subject and discusses some fundamental issues in further studies of embodiment topics covered include the nature of the embodiment hypothesis the vintage model of capital and embodiment in other inputs the use of the embodiment hypothesis to study productivity trends the embodiment hypothesis and the productivity slowdown in the 1970s and 1980s and potential future applications of the embodiment hypothesis

are emily and greg more employable than lakisha and jamal a field experiment on labor market discrimination we study race in the labor market by sending fictitious resumes to help wanted ads in boston and chicago newspapers to manipulate perceived race resumes are randomly assigned african american or white sounding names white names receive 50 percent more callbacks for interviews callbacks are also more responsive to resume quality for white names than for african american ones the racial gap is uniform across occupation industry and employer size we also find little evidence that employers are inferring social class from the names differential treatment by race still appears to still be prominent in the u s labor market jel j71 j64

can crop purchase programs reduce poverty and improve welfare in rural communities evidence from the food reserve agency in zambia the last decade has seen a resurgence of parastatal crop marketing institutions in sub saharan africa many of which cite improving food security and incomes as key goals however there is limited empirical evidence on the welfare effects of these programs this article considers one such program the zambian food reserve agency fra which purchases maize from smallholder farmers at a pan territorial price that typically exceeds maize market prices in surplus production areas using both fixed effects and an instrumental variables approach combined with correlated random effects we estimate the effects of the fra s maize marketing activities on smallholder farm household welfare results suggest that fra activities have positive direct welfare effects on the small minority of smallholder households that are able to sell to it however the results also suggest negative indirect fra effects as higher levels of fra activity in a district are associated with higher levels of poverty

modeling the impact of agricultural growth and government policy on income distribution in india this article uses a limited general equilibrium model to investigate the growth and equity effects of a variety of economic and technical changes and selected agricultural policies in india it explores how changes in food prices rural wages and farm profits associated with the green revolution period affected income distribution between net buyers and sellers of food the model shows that income gains from the green revolution initially accrued to the wealthier rural groups but that after 1972 73 they were transferred to urban consumers and that by 1980 81 the per capita incomes of poor and wealthier rural groups alike were barely above their respective 1960 61 levels the model is also used in counterfactual analysis of the impact of changes in technological demographic investment taxation and income redistribution variables its findings indicate the importance of trade policies for the nature of the equity outcomes from agricultural growth and suggest that a reduction in population growth and an increase in nonagricultural employment and income are required to convert agricultural growth into reduced rural poverty

environment specific rates and biases of technical change in agriculture in developing countries growth rates of agricultural technology exhibit wide variation across environments because of heterogeneity of land quality technical change analyses employing aggregate data typically capture this information very imperfectly because observation units rarely coincide with areas of environmental uniformity the author presents a model permitting environment specific variation in the rate and factor bias of technical change when information on environmental qualities is limited an application using philippine data reveals substantial discrepancies between stylized irrigated and nonirrigated areas in the rate and biases of technical change implications of these differences for employment growth and income distribution are analyzed

will affirmative action policies eliminate negative stereotypes a key question concerning affirmative action is whether the labor market gains it brings to minorities can continue without it becoming a permanent fixture in the labor market the authors argue that this depends on how the policy affects employers beliefs about the productivity of minority workers they study the joint determination of employer beliefs and worker productivity in a model of statistical discrimination in job assignments the authors prove that even when identifiable groups are equally endowed ex ante affirmative action can bring about a situation in which employers correctly perceive the groups to be unequally productive ex post copyright 1993 by american economic association

incentive conflicts and contractual restraints evidence from franchising abstract this study uses agency theory to develop testable implications about three provisions commonly observed in franchise contracts 1 restrictions on passive ownership 2 area development plans and 3 mandatory advertising expenditures the primary hypothesis is that these provisions are most likely when there are significant externalities among the units within the franchise system the evidence based on a large sample of franchise contracts is generally consistent with this hypothesis the evidence also suggests that these incentive instruments are complements in contrast to the theory most of the results do not support the hypothesis that the percentage of company owned units is related to externalities within the system franchisee risk aversion and or wealth constraints appear more important while the study focuses on franchising the results provide insights into related provisions in other contracts

costly information acquisition experimental analysis of a boundedly rational model the directed cognition model assumes that agents use partially myopic option value calculations to select their next cognitive operation the current paper tests this model by studying information acquisition in two experiments in the first experiment information acquisition has an explicit financial cost in the second experiment information acquisition is costly because time is scarce the directed cognition model successfully predicts aggregate information acquisition patterns in these experiments when the directed cognition model and the fully rational model make demonstrably different predictions the directed cognition model better matches the laboratory evidence jel d83

effect of modern rice varieties and irrigation on household income distribution in nepalese villages abstract since high yielding modern rice varieties mvs are adopted only in favorable production environments significant regional productivity differentials have emerged in nepal this study explores the distributional consequences of such differential mv adoption based on an intensive survey of favorable and unfavorable villages we found that mv adoption increased returns to land but decreased family labor earnings from rice production as it facilitated the substitution of hired for family labor as a result the differential mv adoption did not significantly worsen the household income distribution according to the results of the counterfactual gini decomposition analysis

the causes and consequences of distinctively black names in the 1960s blacks and whites chose relatively similar first names for their children over a short period of time in the early 1970s that pattern changed dramatically with most blacks particularly those living in racially isolated neighborhoods adopting increasingly distinctive names but a subset of blacks actually moving toward more assimilating names the patterns in the data appear most consistent with a model in which the rise of the black power movement influenced how blacks perceived their identities among blacks born in the last two decades names provide a strong signal of socioeconomic status which was not previously the case we find however no negative relationship between having a distinctively black name and later life outcomes after controlling for a child s circumstances at birth

segmentation in rural financial markets the case of nepal abstract based on a farm household survey in nepal this study found that farm size and irrigation are major determinants of borrowing from formal institutions whereas family size is the most decisive factor in borrowing from informal sources formal sector borrowing per hectare of cultivated area however initially increases and then decreases with farm size our analysis indicates that while very small farmers tend to be excluded from the formal financial market because of a lack of collateral very large farmers choose to borrow less from that source because of lower production efficiency

carbon reducing taxes and income inequality general equilibrium evaluation of alternative energy taxation in taiwan recently several studies have been a detailed evaluation of the economic implications of energy taxation as a policy instrument to conserve energy and reduce carbon emissions however little attention has been devoted to inquiring about the economic implications of energy taxation in the newly industrialized countries the so called nics in this paper we use a multisector multihousehold computable general equilibrium model to assess the distributional effects of alternative energy taxation on the taiwan economy the counterfactual simulation technique is applied to investigate the income distribution implications of 1 an increase in the import taxes of crude oil and 2 an increase in the excise taxes of petroleum products our empirical results basing on taiwan s data show that both energy taxes increase government revenue and the gini coefficient but reduce net value added private consumption disposable income and equivalent variation a raise in the gini coefficient implies that there is a

carbon emissions control and trade liberalization coordinated approaches to taiwan s trade and tax policy abstract in recent years several studies have emerged on the possible reconciliation between trade and environmental policies however little attention has been devoted to inquiring about the economic implications of the linkages of these policies in the newly industrialized countries the so called nics in this paper we investigate the joint effects of trade and environmental policies on the taiwan economy the estimates are derived from a five household 18 sector computable general equilibrium model calibrated to a 1995 social accounting matrix our empirical results based on taiwan s data show that tariff elimination can significantly reduce the costs of carbon emissions control and possibly offset welfare reductions due to implementation of a carbon tax our findings reveal that the coordination of trade liberalization with the introduction of targeted environmental policies enhances factor relocation towards competitive industries they are broadly consistent with those cases of developing countries reported in previous studies

a computable general equilibrium model of the southern region of taiwan the impact of the tainan science based industrial park the primary modelling tools used to analyse regional economic issues include econometric forecasting models fixed price input output i o multi sector models social accounting matrix sam and computable general equilibrium cge models cge models combine the advantages of econometric i o models and sam strengthening the theoretical basis of the modelling effort and thus enabling more precise policy analysis current cge literature includes models used to analyse international trade tax reform energy and environment issues however application of this technique on a regional scale is rare in the scientific literature in this paper a small regional computable general equilibrium model is constructed and applied to analyse the economic impact of constructing tainan science based industrial park tsbip locating in southern taiwan the research results provide a valuable reference for decision makers in formulating industrial and regional policies as well as helping business managers with strateg

sex discrimination in restaurant hiring an audit study in an audit study of sex discrimination in hiring comparably matched pairs of men and women applied for jobs as waiters and waitresses at restaurants in philadelphia in high price restaurants where earnings are higher job applications from women had an estimated probability of receiving a job offer that was lower by about 0 4 and an estimated probability of receiving an interview that was lower by about 0 35 both estimated differentials are statistically significant additional evidence suggests that customer discrimination partly underlies the hiring discrimination

orchestrating impartiality the impact of blind auditions on female musicians a change in the audition procedures of symphony orchestras adoption of blind auditions with a screen to conceal the candidate s identity from the jury provides a test for sex biased hiring using data from actual auditions in an individual fixed effects framework we find that the screen increases the probability a woman will be advanced and hired although some of our estimates have large standard errors and there is one persistent effect in the opposite direction the weight of the evidence suggests that the blind audition procedure fostered impartiality in hiring and increased the proportion women in symphony orchestras

a language theory of discrimination any advanced industrial society is composed of a number of speech communities with different verbal and nonverbal languages in particular in the united states blacks and whites and men and women have sharply differing methods of speaking and listening this paper develops a model in which people can only work together if they speak the same language and in which it is costly to learn a second language the competitive market will tend to minimize communication through segregation but if interaction is required the cost will be borne by the minority a number of nontrivial predictions are derived from the model

field experiments of discrimination in the market place controlled experiments using matched pairs of bogus transactors to test for discrimination in the marketplace have been conducted for over 30 years and have extended across 10 countries significant persistent and pervasive levels of discrimination have been found against non whites and women in labour housing and product markets rates of employment discrimination against non whites in excess of 25 have been measured in australia europe and north america a small number of experiments have also investigated employment discrimination against the disabled in britain and the netherlands and against older applicants in the united states

revealed preference rational inattention and costly information acquisition we develop a revealed preference test for optimal acquisition of costly information the test encompasses models of rational inattention sequential signal processing and search we provide limits on the extent to which attention costs can be recovered from choice data we experimentally elicit state dependent stochastic choice data of the form the tests require in simple cases tests con rm that subjects adjust their attention in response to incentives as the theory dictates

role of agricultural research in poverty reduction lessons from the asian experience abstract the poor spend much of their income on food depend primarily on labour earnings and tend to reside in marginal agricultural areas to reduce poverty agricultural research should aim to ensure adequate food supplies by developing yield increasing technologies to increase labour demand by developing labour using technologies and to develop technologies suitable for marginal areas this article seeks to identify appropriate technologies that agricultural research should generate for poverty reduction the identification is based on a review of the experience of the green revolution in rice production in asia and an assessment of the changing structure of income sources among rural households in the philippines

vertical restraints and the law evidence from automobile franchising abstract after a 2002 european commission regulation prohibited the use of dealer exclusive territories automobile franchise contracts in italy introduced price ceilings and standards on verifiable marketing and service inputs such as advertising and salespeople the contracts also imposed quantity floors a practice already in use before the regulatory change the introduction of standards suggests that consistent with a view of vertical restraints as coordination mechanisms manufacturers used exclusive territories to induce desired dealer services and once the use of exclusive territories was prohibited they switched to alternative contractual devices to achieve this goal the introduction of price ceilings despite free intrabrand competition also suggests that car manufacturers tried to prevent some dealers from gaming the quantity floors by selling to other dealers customers while charging monopolistic prices at their own locations

an economic theory of vertical restraints vertical restraints imposed by manufacturers on the prices locations and sales of retail firms represent a puzzling departure from the simple price mediated exchange of conventional markets in this article we analyze the theoretical basis for these restraints in a setting where retailers inform consumers and are imperfectly competitive and where a manufacturer has some monopoly power we identify three potential externalities affecting retailers decisions these externalities lead to the failure of simple uniform price contracts to coordinate the incentives of retailers with the objective of maximizing combined manufacturer and retailer profits we identify the packages of vertical restraints that are minimally sufficient under various conditions to neutralize the externalities and to achieve the joint profit maximum

ignorance isn t bliss uninformed voters drive budget cycles abstract the paper shows that blissful ignorance does not apply to fiscal policy in countries with uninformed voters politicians attempt to buy votes by substantially increasing government expenditures in election years this generates budget cycles and costly macroeconomic fluctuations unlike much of the earlier literature that found this effect only in low income countries or new democracies we demonstrate that it has occurred in many prosperous countries with an established political system in particular constructing a comprehensive informed voter infovot index and quantifying it for the 1995 2014 period we show that only the top third of oecd countries with well informed voters has not experienced political budget cycles in contrast the bottom third of oecd countries with poorly informed voters has consistently seen a deterioration of the budget balance by 0 7 1 2 of gdp in election years this represents an increase of 18 30 relative to their usual non election budget deficits interestingly for the intermediate group of countries with moderately informed voters for example austria france germany japan luxembourg the u k and the u s election budget cycles occurred during the 1995 2008 period but not since we discuss why their election year deficit hikes of 0 5 0 8 of gdp may have disappeared after the global financial crisis drawing on the rational inattention literature all our results are supported by a large number of robustness checks including the use of a yearly version of the index yinfovot we conclude by offering some policy recommendations that may improve the voters incentives to process fiscal policy information as such they could help to escape an ignorance trap whereby uniformed voters choose politicians whose policies reinforce the voters ignorance

differential adoption of modern rice technology and regional wage differential in nepal in nepal which consists of ecologically distinct regions the concentration of the adoption of modern rice varieties in the favourable rice growing areas of the country has raised fears that regional income disparities have widened this study shows that greater demand for hired labour due to the adoption of modern rice varieties has induced permanent and seasonal migration from unfavourable to favourable areas this appears to have largely equalised average wage rates across different production environments thus as far as labour income is concerned benefits from the modern varieties have been widely shared

induced bias of technical change in agriculture the united states and japan 1880 1980 because of extreme differences in factor endowments and price ratios among factors between the united states and japan both countries have experienced sharply different patterns of factor use and productivity growth in agriculture for the past 100 years of modern economic growth in this study the method of testing the hicksian hypothesis of induced innovation was developed using the two level ces production function the model was applied to the historical data of u s and japanese agricultural development for 1880 1980 the results were consistent with the hypothesis that different patterns of technical change in the two countries were induced by differences in the levels and the movements in relative factor prices

technology production environment and household income assessing the regional impacts of technological change abstract this paper clarifies the factors determining the welfare effects of improved agricultural technologies when technology diffusion is unevenly distributed across production environments household level income effects are shown to depend primarily on a whether the economy is open or closed with respect to world markets b whether households are net consumers or net producers of the commodity for which technological change occurs c whether households are adopters or non adopters of the new technology d the degree to which labor is mobile across agricultural regions and e government intervention in commodity and or factor markets a review of recent empirical work indicates considerable variation in the relative strength of these various factors across countries and that assumptions regarding the mechanism by which commodity prices are determined endogenously as in a closed economy or exogenously as in an open economy is especially critical

exclusive contracts foster relationship specific investment exclusive contracts prohibit one or both parties from trading with anyone else contrary to earlier findings we show that investments that are specific to the contracting parties may be encouraged by exclusivity results depend on the nature of investments and the bargaining solution the major part of the analysis shows that exclusivity deals designed to assure the supply of essential inputs promote investment infinite penalties for breach even if ex post renegotiable may result in excessive investment in which case a positive but finite damage payment yields the first best outcome

electoral competition with rationally inattentive voters how do voters allocate costly attention to alternative political issues and how does selective ignorance of voters interact with policy design by politicians we address these questions by developing a model of electoral competition with rationally inattentive voters rational inattention amplies the eects of preference intensity because voters pay more attention where stakes are higher the model has many potential applications and those that we discuss in more detail imply that extremist voters are more attentive and inuential public goods are under provided divisive issues receive more attention and less transparent candidates choose more extreme policies endogenous attention can also lead to multiple equilibria explaining how poor voters in developing countries can be politically empowered by welfare programs

evidence on discrimination in consumer markets economists have contributed to the measurement of racial and ethnic discrimination in consumption and to the identification of its causes especially in housing markets and car sales to test the hypothesis that discrimination exists economists have turned to regression analysis and to audits a matched pair survey technique economists also have developed audit based measures of the incidence and severity of discrimination audit studies find continuing high levels of discrimination against minorities in the marketing of available housing and in car prices audit studies also find that discrimination can be caused both by economic agents prejudice and by their search for profits

behavioural and material determinants of production relations in agriculture in this essay we develop a framework for analysing the major institutions governing the production and exchange of output and the primary factors of production in rural areas the analysis incorporates general considerations of risk and information constraints jointly with the principal material attributes of agriculture and of agricultural production factors the framework is used to analyse barriers to the existence of the major intertemporal and factor markets it is applied specifically to land scarce environments for which it provides an internally consistent explanation for many of the well documented institutional features of such settings in addition the analysis provides new implications for among other phenomena the inter relationships among ownership holdings operational scale family size and factor productivity for the scarcity of animal rental markets and use of animals as collateral for the renting out of land by small landowners and for the existence of plantations for certain crops

explaining state bans on corporate farming state laws banning corporate farming present a puzzle for a rent seeking explanation of political outcomes since family farmer proponents may receive no direct benefit from these bans an explanation developed here is that these farmers benefit indirectly forestalling corporate entry preserves the farm political coalition structured around those cooperatives patronized by family farmers and so indirectly preserves federal subsidies and supply restrictions that the incidence of state bans is positively related to the importance of federal farm programs the importance of cooperatives and the homogeneity of farmers within a state is consistent with this indirect rent seeking explanation

experimental research on labor market discrimination understanding whether labor market discrimination explains inferior labor market outcomes for many groups has drawn the attention of labor economists for decades at least since the publication of gary becker s the economics of discrimination in 1957 the decades of research on discrimination in labor markets began with a regression based decomposition approach asking whether raw wage or earnings differences between groups which might constitute prima facie evidence of discrimination were in fact attributable to other productivity related factors subsequent research responding in large part to limitations of the regression based approach moved on to other approaches such as using firm level data to estimate both marginal productivity and wage differentials in recent years however there has been substantial growth in experimental research on labor market discrimination although the earliest experiments were done decades ago some experimental research on labor market discrimination takes place in the lab but far more of it is done in the field which makes this particular area of experimental research unique relative to the explosion of experimental economic research more generally this paper surveys the full range of experimental literature on labor market discrimination places it in the context of the broader research literature on labor market discrimination discusses the experimental literature from many different perspectives empirical theoretical and policy and reviews both what this literature has taught us thus far and what remains to be done

optimal sticky prices under rational inattention this paper presents a model in which price setting firms decide what to pay attention to subject to a constraint on information flow when idiosyncratic conditions are more variable or more important than aggregate conditions firms pay more attention to idiosyncratic conditions than to aggregate conditions when we calibrate the model to match the large average absolute size of price changes observed in micro data prices react fast and by large amounts to idiosyncratic shocks but only slowly and by small amounts to nominal shocks nominal shocks have strong and persistent real effects we use the model to investigate how the optimal allocation of attention and the dynamics of prices depend on the firms environment jel e 3 e5 d8

income distribution in rice growing villages during the post green revolution periods the philippine case 1985 and 1998 this paper aims to examine changes in household income sources and its impact on household income distribution in the post green revolution periods in 1985 and 1998 in the rural philippines we found that there has been a structural shift of household income away from farm in favor of nonfarm labor income sources this finding indicates that rural development is being led by nonfarm sectors such a shift has resulted in an increase in household income inequality as the distribution of nonfarm income has become less equal over time and was markedly more unequal than that of farm income in 1998

reasonable expectations on the prospects for documenting the impact of agricultural research on poverty in ex post case studies abstract the increasing emphasis on poverty alleviation as a motivation for investing in public sector international agricultural research is discussed from the perspective of practitioners engaged in ex post impact evaluation context is largely provided from the experience of the international potato center cip in impact assessment of improved potato and sweet potato technologies the poverty content of 10 cip related success stories of technological change was qualitatively assessed with a checklist of key questions with this admittedly crude method the size of project net present value npv appears to be an informative guide to the magnitude of poverty effects hence projects that generate widespread benefits to many people particularly to net consumers of food crops remain likely to be the most effective vehicles to contribute to poverty alleviation from public sector investments in the improvement of food crops in developing countries

implications of rational inattention abstract a constraint that actions can depend on observations only through a communication channel with finite shannon capacity is shown to be able to play a role very similar to that of a signal extraction problem or an adjustment cost in standard control problems the resulting theory looks enough like familiar dynamic rational expectations theories to suggest that it might be useful and practical while the implications for policy are different enough to be interesting

discrimination in the rental housing market a field experiment on the internet this paper presents a field experiment on discrimination in the housing market using the internet as a research platform the procedure involved our creating three fictitious persons with distinct

the short run trade off between food subsidies and agricultural production subsidies in developing countries the trade offs resulting from the choice of policy alternatives to improve short run welfare of poor households in developing countries are examined through a comparison of food subsidies and agricultural production subsidies using india as a case study the analysis is undertaken with an economy wide multisector model comparing general untargeted food and production subsidies the results show larger real income gains for all food buyers through production subsidies targeted food subsidies are more beneficial for the urban poor while the rural poor benefit more from targeted production subsidies suggesting the need to use the two subsidies as a joint policy package in the short run

attention discrimination theory and field experiments with monitoring information acquisition we link two important ideas attention is scarce and lack of information about an individual drives discrimination in selection decisions our model of allocation of costly attention implies that applicants from negatively stereotyped groups face attention discrimination less attention in highly selective cherry picking markets where more attention helps applicants and more attention in lemon dropping markets where it harms them to test the prediction we integrate tools to monitor information acquisition into correspondence field experiments in both countries we study we find that unfavorable signals minority names or unemployment systematically reduce employers efforts to inspect resumes also consistent with the model in the rental housing market which is much less selective than labor markets we find landlords acquire more information about minority relative to majority applicants we discuss implications of endogenous attention for magnitude and persistence of discrimination in selection decisions returns to human capital and potentially for policy