is there a bright side to a black market for inkind transfers a number of recent studies analyze inkind transfer programs while acknowledging the presence of a black market 3 4 9 however the black market for inkind transfers typically finds its way into these analyses only in terms of the recipients ability to sell their inkind transfers as such it is viewed as undesirable and as a leakage from the program in this study i take a more complete view of black markets and the policy opportunities they present and i discover that black markets may instead have desirable consequences this research takes a different approach to the study of inkind transfers and black markets by acknowledging the existence of both sides of the black market demand as well as supplyand by exploring the possibility that government policy may be able to exploit the black market incentive this approach yields results that often contradict those from existing analyses and suggest that a black market under certain conditions may reallocate resources efficiently and perhaps equitably and can reduce the cost of inkind transfer programs to the government while maintaining or even improving the well being of recipients finally while this study focuses on the food stamp program as an example its implications can be extended to other inkind transfer programs the next section reviews the standard economic and econometric analyses of inkind transfer programs and then examines how they are affected by acknowledging the demand side of the black market in section iii i construct a simple theoretical model to aid in identifying the likely buyers of illegal food stamps section iv explores ways to make desirable use of the existence of a black market incentive and proposes an alternative program that lowers costs by exploiting this incentive section v contains conclusions

europe vs america institutional hysteresis in a simple normative model we show how the differences in us and european institutions can arise in a normative model the paper focuses on the labor market and the government s decision to set unemployment benefits in response to an unemployment shock the government balances insurance considerations with the tax burden of benefits and the possibility that they introduce adverse incentive effects whereby benefits increase unemployment it is found that when an adverse shock occurs benefits should be increased most when the adverse incentive effects of benefits are largest adjustment costs of changing benefits introduce hysteresis and can help explain why post oil shock benefits remained high in europe but not in the us desirable features of the model are that we obtain an asymmetry out of a symmetric environment and that the mechanism yielding hysteresis is both simple requires the third derivative of the utility function to be non negative and self correcting empirical evidence concerning the role of corporatism is discussed

rationing by waiting and the value of time results from a natural experiment the authors analyze data from a natural experiment with rationing by waiting in the situation motorists were confronted with a choice between waiting in line for low priced gasoline or purchasing at a higher price without waiting they view this as a revealed preference experiment and use their choices to estimate the value of time spent waiting as a function of individual characteristics in most cases the estimates of the value of time are quite similar to individuals after tax wages 13 references 7 tables

country size and the medium term growth process some cross country evidence abstract this paper summarizes the findings of an empirical study of the influence of country size and remoteness on the sources of growth and nature of the growth process in industrializing countries various hypotheses were investigated in the study in the context of a model of disequilibrium growth which allows for technological spillover between sectors and between countries the model was estimated for a large sample of developing economies for 1973 1985 the stability of the model s parameters for various dimensions of size and remoteness was tested evidence of significant structural breaks permitted inferences to be drawn about how the nature and extent of technological spillovers are influenced by country size this paper reports on the results and implications of the empirical tests

early career work experience and gender wage differentials we estimate a wage model that includes an array of variables measuring the fraction of time worked during each year of the career this array fully characterizes past employment experience regardless of how sporadic it has been our model yields substantially higher estimated returns to experience and lower returns to tenure than do models that measure experience cumulatively and use the standard quadratic functional form we find that the data reject the standard model but fail to reject our model furthermore we find that 12 of the male female wage gap is due to differences in the timing of work experience

wage flexibility in the chinese labour market 1989 2009 abstractwage flexibility in the chinese labour market 1989 2009 regional studies china s bureaucratic wage determination system is gradually being replaced by a market based system leading to a novel version of a dual labour market this paper studies wage flexibility in this dual market its principal findings are as follows wages in both sectors have become less responsive to changes in official registered unemployment with an alternative market based measure of unemployment becoming more relevant there is evidence of convergence of flexibility between the two sectors the wages of women exhibit greater flexibility than those of men and there is evidence of differences in wage flexibility between workers who have urban residential rights and rural migrants

the special problems of small countries abstract the paper describes the characteristics of small economies and discusses the advantages and disadvantages arising from these characteristics it is shown that small economies by their very nature tend to be less diversified and to have relatively high foreign trade risks in spite of these drawbacks a number of small economies have achieved high rates of economic growth some reasons given to explain this success are the relatively small size of the agricultural sector concentration on labor intensive exports and sociological and psychological factors such as the ability to respond in a flexible manner to changes the paper ends with a discussion on whether the drawbacks of small size can be overcome by economic integration it is argued that the experience in this regard is disappointing

the implications of increasing globalization and regionalism for the economic growth of small island states abstract this paper provides an overview of the implications of globalization and increasing regionalism for small island states in the context of the critical determinants of their economic growth a brief outline of the globalization process is provided followed by a discussion of regionalism and the trend in subnational regional autonomy this is followed by an overview of the empirical literature on the critical factors determining the growth of small states next is an analysis of the implications for small island states of increasing globalization and regionalism in the context of the critical growth factors identified in the preceding section the paper concludes by proposing an agenda for further research into the implications for small island states of the impact of globalization on specific growth factors

rent shifting and rent sharing a re examination of the strategic industrial policy problem this paper reexamines the market structure problem in the strategic trade policy literature it is shown that rent sharing between the home union and the home firms raises total home industry rents regardless of whether the international duopoly is cournot or bertrand furthermore home welfare also rises with cooperation if the international industry consists of more than two firms if the industry is faced with entry and if there is domestic consumption this paper shows that rent sharing can be a robust strategic industrial policy and can be interpreted as a solution to the market structure dilemma

tourism and development a recent phenomenon built on old institutional roots is tourism an opportunity for lagging countries in the elusive quest for growth easterly 2002 recent empirical evidence suggests that the answer is a cautious yes aggregate cross country data show that tourism specialization is likely to be associated with higher per capita gdp growth rates than those observed in industrialized countries however this evidence ignores the importance of institutional quality and results are likely to be biased by omitted variable problems in this paper we frame our starting question within the general debate about the importance of good bad institutions as fundamental determinants of economic growth acemoglu et al 2001 and ask whether previous positive results of tourism on growth are in fact driven by the presence of growth enhancing institutions our empirical analysis exploits newly available datasets and controls the robustness of previous results on growth and tourism in the presence of several institutional quality variables by means of descriptive statistics and some simple cross country regressions we confirm that the quality of institutions is important for growth yet our results strongly suggest that the weight of tourism in an economy is an independent and robust predictor of higher than average growth

employment motherhood and school continuation decisions of young white black and hispanic women we examine the empirical relationship between early employment activity and school continuation decisions for young american women using a dynamic sequential discrete choice framework that estimates schooling labor supply and birth decisions jointly controlling for unobserved heterogeneity and the endogeneity of these life cycle decisions that the rate of school withdrawal increases as work intensity rises helps explain the higher departure rates of hispanic girls from secondary school and the premature departure of young black women from college the disturbing implication is that youth employment induces long run wage stagnation for early school leavers and potentially increases race and ethnic inequities

a paradigm shift to a new strategy for small island economies embracing demand side economics for value enhancement and long term economic stability abstract the article answers three interrelated questions pertaining to small island economies and tourism development under the condition of globalization 1 why is tourism relevant for small island economies 2 why is a supply perspective inappropriate for these economies and 3 why is a demand perspective more appropriate for small island economies in the era of globalization empirical realities indicate that small islands have performed well in specializing as tourist destinations despite their size constraints and resulting disadvantage in economic terms the caribbean region is an appropriate proxy for small island economies however globalization may be taking its toll on sectoral specialization in the caribbean as a development strategy the supply side strategy seems to have lost its effectiveness to reverse this trend the study proposes the implementation of new tourism strategies based on a demand focused approach to sustain value enhancement these strategies have important managerial and policy implications

the impact of political dependence on small island jurisdictions summary this paper examines the connection between political dependence and welfare and development of small island jurisdictions four possible advantages of political dependence are access to foreign aid foreign capital and external labor markets and gains in the tourism industry this study analyzes if political dependence is associated with these possible advantages and the relative importance of each on the welfare and development within the island it is shown that politically dependent islands have achieved significantly higher levels of welfare and development with some of the reasons being due to the large inflows in the form of tourism foreign direct investment labor and aid

cooperation harassment and involuntary unemployment an insider outsider approach the authors present a theory of involuntary unemployment which explains why the unemployed workers outsiders are unable or unwilling to find jobs even though they are prepared to work for less than the prevailing wages of incumbent workers in siders the outsiders do not underbid the insiders since were the y to do so the insiders would withdraw cooperation from them making their work unpleasant with harassment and thereby reducing the prod uctivity and increasing the reservation wages of the underbidders th e resulting labor turnover costs create economic rent which the insid ers tap in wage setting and as a result involuntary unemployment ma y arise copyright 1988 by american economic association

life cycle schooling and dynamic selection bias models and evidence for five cohorts of american males this paper examines an empirical regularity found in many societies that family influences on the probability of transiting from one grade level to the next diminish at higher levels of education we examine the statistical model used to establish the empirical regularity and the intuitive behavioral interpretation often used to rationalize it we show that the implicit economic model assumes myopia the intuitive interpretive model is identified only by imposing arbitrary distributional assumptions onto the data we produce an alternative choice theoretic model with fewer parameters that rationalizes the same data and is not based on arbitrary distributional assumptions

a comparison of the economic performance of different micro states and between micro states and larger countries the economic performance of micro states and those sub national regions enjoying a high degree of autonomy is a generally under researched area this paper builds on earlier research armstrong and read 1995 by employing quantitative techniques to test 1 a the extent to which the economic performance of micro states differs by comparing their gnp per capita with that of the region in which they are located and with the countries to which they are adjacent 2 b whether some micro states perform better than others as a result of differences in their economic structure and 3 c whether the rates of growth of micro states have been faster or slower than those of larger countries considerable diversity among micro states is revealed although most exhibit strong economic performance

the race is to the swift socioeconomic origins adult education and wage attainment the winners in today s winner take all labor markets are differentiated by advanced levels of educational attainment especially higher degrees this article applies a sociological model of cumulative dis advantage to the baby boom cohort to examine whether life course timing differences in educational attainment help explain wage differentials by midlife it finds that advantaged social origins lead to early postsecondary completion of degrees which in turn yield higher wages a pathway of cumulative disadvantage is also evident where those least advantaged exit schooling early in life do not return as adults and earn low wages in a middle path advantaged social origins promote adult school attainment primarily for those without degrees but generally without the wage boosts associated with attainment earlier in life

wage inequality and family labor supply using the march current population surveys and the 1960 census this article describes earnings and employment changes for married couples in different types of households stratified by the husband s hourly wage while declines in male employment and earnings have been greatest for low wage men employment and earnings gains have been largest for wives of middle and high wage men these findings cast doubt on the notion that married women have increased their labor supply in the recent decades to compensate for the disappointing earnings growth of their husbands

the role of transport costs as a determinant of price level differentials between the isle of man and the united kingdom 1989 the isle of man experiences price levels which for consumer convenience goods are some 10 higher than those in nearby regions of the uk mainland the observed price differentials indicate incomplete economic integration with the united kingdom this paper presents the results of two major research projects undertaken on behalf of the isle of man board of consumer affairs by a team of researchers at lancaster university the research analyzes the role which transport costs to the island play in determining the observed price differentials between the isle of man and the united kingdom transport costs both marine and road haulage were found to account for only a relatively small part of the observed price differentials other major causes of price differentials between the island economy and the mainland were found to include high stockholding and inventory costs the failure to exploit economies of scale fully in the on island wholesaling and retailing sectors as a result of small market size and imperfect competition among island business sectors the study highlights the difficulties faced in integrating island and mainland economies freight transport improvements alone cannot eliminate price differentials

tiny poor and war torn development policy challenges for east timor abstract following its decisive vote for independence on 30 august 1999 east timor will soon become the world s newest country the country has a particularly tragic history centuries of portuguese colonialism and neglect 24 years of troubled occupation by indonesia and the horrific violence and massive destruction of infrastructure which occurred in the wake of the 1999 vote for independence the country will start from one of the lowest points conceivable on the scale of socioeconomic development extremely low income very limited bureaucratic capacities barely functioning institutions and potentially hostile elements in its giant neighbor the formidable development policy challenges facing this new country are the subject of this paper

labor supply and housing demand for one and two earner households the jointness of labor and housing decisions is explicitly modelled in a consumer demand framework behavior of seven demographic groups differentiated by marital status employment status and the presence of children is estimated from a micro data set results indicate that 1 decisions regarding work hours and housing consumption are interdependent choices and 2 responses to market signals differ significantly by demographic group results are likely to be superior to single equation studies or studies based on aggregate data

innovative development strategies from non sovereign island jurisdictions a global review of economic policy and governance practices summary the world s sub national island or mainly island jurisdictions constitute a timely valid and valuable category of political and economic analysis on the basis of a global largely inductive and discriminant analysis five economic and four political capacities are suggested as being characteristic of the innovative development strategies practised today by various island autonomies extant mainland island relations can provide insights to other smaller non island as well as larger players beyond the strictures of both economic vulnerability and sovereignty

time series growth in the female labor force in this paper we investigate the reasons for the growth in the female labor force in america during the twentieth century in our research we study the longer term trends since 1900 and conduct a more intensive examination of developments after the second world war on the basis of our work we conclude that rising real wages accounted for 60 of the total growth in the female labor force half of this wage effect in expanding labor supply was the fertility reducing consequence of a higher female wage

household commodity production and social harassment costs in a seminal article becker 2 suggested that consumer behavior be viewed as a process in which households produce commodities meals plays and so on by combining goods or services food theatre tickets and so on and time households are perceived in that model as utility maximizing producers in effect becker s model demonstrates that money prices of goods or services do not provide sufficient information to explain or predict household choice more specifically money prices of goods or services do not reflect the full costs of household produced commodities because money prices exclude the costs of the household s time spent in the production of such commodities mincer 7 showed that unless the costs of time are considered the income elasticities of demand for different commodities are biased abbott and ashenfelter 1 have established the theoretical conditions for household utility maximizing expenditures of income and time wales and woodland 9 assumed that households maximize utility functions which include leisure and a hicksian composite good the budget constraint is written in terms of wage rates the price of the composite good nonlabor income the total number of hours available and the full income of the household consistent with the becker model kohlhase 5 constructed simultaneous constraints in which the income and time constraints are reduced to a full income constraint under the assumption that households buy back the leisure time and commuting time of market workers at the market wage rates and deacon and sonstelie 4 analyzed a natural situation in which for a short time motorists were faced with a choice between a waiting in line for low priced gasoline or b not waiting and purchasing gasoline of a similar quality at a higher price by surveying customers at one low priced station and at two nearby high priced stations they were able to estimate the costs of time for people in both groups they found that in general estimates of the costs of time were similar to the after tax wages of respondents thereby providing additional evidence that the money price does not always convey sufficient information to predict household choice

why do people care about social status abstract this paper shows that complementary interaction can induce people to care about social status because it serves as a signal of non observable abilities there is a unique separating equilibrium in which everyone cares about social status in this equilibrium a person s social status perfectly reveals his abilities and everyone matches with a person of like ability the analysis shows that people s instrumental concern for social status has important welfare and policy implications indeed peoples efforts to keep up with the joneses may be welfare enhancing

swimming upstream trends in the gender wage differential in the 1980s using michigan panel study of income dynamics data for 1979 and 1988 we analyze how a falling gender wage gap occurred despite changes in wage structure unfavorable to low wage workers the decrease is traced to gender specific factors which more than counterbalanced changes in measured and unmeasured prices working against women supply shifts net of demand were unfavorable for women generally and hurt high skilled more than middle and low skilled women by analyzing wages we find support for the notion of a gender twist in supply and demand having its largest negative effect on high skilled women