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3A1831633574.jsonld | Chapter 26 The economics of international aid | This paper presents an overview of the economics of international aid, highlighting the historical literature and the contemporary debates. It reviews the “trade-theoretic” and the “contract-theoretic” analytical literature, and the empirical and institutional literature. It demonstrates a great degree of continuity in the policy concerns of the aid discourse in the twentieth century, and shows how the theoretical, empirical and institutional literature has evolved to address specific policy concerns of each period. |
3A730043673.jsonld | Competition in Bidding Markets | The OECD Competition Committee debated competition in bidding markets in October 2006. Competition authorities become interested in auctions by a number of routes. In competition advocacy, they may advise other parts of government on how to design auctions in order to improve their efficiency—the degree of competition. They may evaluate mergers and agreements between firms that operate in auction markets. And they may be concerned with collusion and abuse of a dominant position in auctions. Because their formal rules reduce “noise” and make communication among rivals easier, auctions can promote collusion, compared with ordinary “posted-price” markets. But an auction can be designed to reduce collusion or concerted practices or to promote participation. Thus, the design of an auction can be the object of lobbying pressure. Auctioneers can also behave strategically, choosing auction formats or practices that favour competition. Two fundamental prescriptions for effective auction design follow from the theoretical literature: Induce bidders to truthfully reveal their valuations by making what they pay not depend entirely on what they bid, and maximize the information available to each participant before he bids. |
3A1831653664.jsonld | Introduction to Handbook | The economics of education has flourished as a research field since the publication of Volumes I and II of the book. There has been a big upsurge in new research by economists on education and education policy. Although this study has predominantly had an empirical leaning, the chapters of this volume make clear that theory plays a continuing role in the development of the field. This economic research continues to be highly practical, with an explicit aim to understand better how education is acquired, how it affects economic and social outcomes of interest, and how it can inform public policy. The chapters in this new volume (Volume IV), and in companion Volume III that has been released, focus upon this new research and its grounding with past economics of education research. The first five specific chapters of this volume cover topics on the role of education for different outcomes. These chapters respectively focus on personality traits, nonproduction benefits, and possible mismatch in the labor market, migration, and comparative development. The next two chapters deal with two important institutional features of school systemsnamely, performance pay and vouchers. The final two chapters address outcomes in higher education and the political economy of education funding, respectively. |
3A1831641658.jsonld | Chapter 27 Search | Search theory has provided a simple and robust laboratory that economic theorists have used to examine a wide variety of questions about the acquisition of information. Early work on search modeled an individual's searching decisions and drew inferences about the value of information and the nature of frictional unemployment. More recent work, building on sequential-bargaining analysis, has focused on the interactions among searching agents and has deepened the understanding of the nature and meaning of competition. The chapter discusses the classical search problem: the optimal search rule for an individual who can, for a fixed and constant cost, take a random sample from a distribution F ( ) of economic opportunities. The marriage of search theory and bargaining theory has produced some of the more interesting recent economic theory. This research has shown such diverse and important topics as the nature of the competitive mechanism and the possible impact of externalities and multiple equilibria on macroeconomic performance. |
3A730007502.jsonld | Indicator models of real GDP growth in the major OECD economies | Accurate and timely information on the current state of economic activity is an important requirement for the policymaking process. Delays in the publication of official statistics mean that a complete picture of economic developments within a particular period emerges only some time after that period has elapsed. Thus considerable resources are, at times, devoted to making an assessment of the immediate past and the current conjuncture as well as projections about future developments. In practice, a regular flow of information is provided by the large number of quantitative and qualitative indicators that appear each month for different sectors of the economy. One challenge for policymakers is to put these together in a consistent manner to obtain a picture of the overall state of the economy. |
3A1831633825.jsonld | Chapter 6 Reciprocity: Its Scope, Rationales, and Consequences | Reciprocity is one of the main basic social relations that constitute societies. It consists of being favourable to others because others are favourable to you (and not from an exchange in the strict sense). It rests on three possible rationales: (1) balance (comparison, matching), often related to equality and fairness, or to the desire to avoid moral indebtedness; (2) liking because being purposefully favoured induces liking which induces favouring, or because liking can directly result from being liked; (3) self-sustaining sequences of mutual favours, which can be solely self-interested (and are not in fact proper reciprocity). Reciprocity extends to important cases of aids inducing aids that are not strictly reciprocal. It has essential social roles in permitting general peace in freedom and respect of rights, the decentralized correction of many market failures, the efficient working of organizations of all types through mutual trust and support, and basic relations between individuals and collectivities and governments. It constitutes the essential relation in families and genuine cooperatives, and it is present in all communities. It explains deviations from competitive equilibria, and it is closely involved in questions of development. The theory of reciprocity shows and compares the various types of solutions of the reciprocity game. Reciprocity is compared with other modes of transfers. Ways of explaining it are proposed. Its normative uses associate efficiency, fairness, and the intrinsic quality of social relations. |
3A1831651785.jsonld | Chapter 12. Epistemic Game Theory | Epistemic game theory formalizes assumptions about rationality and mutual beliefs in a formal language, then studies their behavioral implications in games. Specifically, it asks: what do different notions of rationality and different assumptions about what players believe about…what others believe about the rationality of players imply regarding play in a game? Being explicit about these assumptions can be important, because solution concepts are often motivated intuitively in terms of players’ beliefs and their rationality; however, the epistemic analysis may show limitations in these intuitions, reveal what additional assumptions are hidden in the informal arguments, clarify the concepts or show how the intuitions can be generalized. A further premise of this chapter is that the primitives of the model— namely, the hierarchies of beliefs—should be elicitable, at least in principle. Building upon explicit assumptions about elicitable primitives, we present classical and recent developments in epistemic game theory and provide characterizations of a nonexhaustive, but wide, range of solution concepts. |
3A1831643863.jsonld | Chapter 55 Schooling in Developing Countries: The Roles of Supply, Demand and Government Policy | In developing countries, rising incomes, increased demand for more skilled labor, and government investments of considerable resources on building and equipping schools and paying teachers have contributed to global convergence in enrollment rates and completed years of schooling. Nevertheless, in many countries substantial education gaps persist between rich and poor, between rural and urban households and between males and females. To address these gaps, some governments have introduced school vouchers or cash transfers programs that are targeted to disadvantaged children. Others have initiated programs to attract or retain students by expanding school access or by setting higher teacher eligibility requirements or increasing the number of textbooks per student. While enrollments have increased, there has not been a commensurate improvement in knowledge and skills of students. Establishing the impact of these policies and programs requires an understanding of the incentives and constraints faced by all parties involved, the school providers, the parents and the children. The chapter reviews the economic literature on the determinants of schooling outcomes and schooling gaps with a focus on static and dynamic household responses to specific policy initiatives, perceived economic returns and other incentives. It discusses measurement and estimation issues involved with empirically testing these models and reviews findings. Governments have increasingly adopted the practice of experimentation and evaluation before taking steps to expand new policies. Often pilot programs are initiated in settings that are atypically appropriate for the program, so that the results overstate the likely impact of expanding the program to other settings. Program expansion can also result in general equilibrium feedback effects that do not apply to isolated pilots. These behavioral models provide a useful context within which to frame the likely outcomes of such expansion. |
3A1831643138.jsonld | Chapter 44 Structural adjustment, stabilization and policy reform: Domestic and international finance | This chapter discusses the role of structural adjustment, stabilization, and policy reform on domestic and international finance. Structural adjustment programs generally start with a conventional stabilization program, intended to restore the viability of the current account and the budget, but they are distinguished from pure stabilization programs by the inclusion of a set of microeconomic-institutional policy reforms. Stabilization measures aimed at restoring macroeconomic balance and reducing inflation focus on bringing the level of demand and its composition (tradeable relative to nontradeable goods) into line with the level of output and the financeable level of the trade deficit. The structural transformation component focuses on the removal of microeconomic obstacles to the efficient allocation of resources. Typical measures include liberalizing the trade regime, removing price controls, deregulating domestic goods markets, reforming the public sector, and removing constraints on factor employment and mobility. |
3A1831637715.jsonld | Chapter 61 Macroeconomics, Macrosectoral Policies, and Agriculture in Developing Countries | This handbook devotes most of its chapters to reviewing sectoral policies related to agriculture. This chapter moves to a macroeconomic and macrosectoral view of the policy framework and its possible interaction with the agricultural sector. A previous handbook (Gordon Rausser and Bruce Gardner, eds., 2002) devoted a whole section with several chapters to economywide policies. 1 Since then, there have been nontrivial changes in macroeconomic trends and policy debates, not only regarding domestic aspects but also, and perhaps more relevant for developing countries, at the level of the global economy. In the spirit of Schuh (1986) this chapter attempts to review and update some of the world macroeconomic issues relevant for agriculture, while at the same time covering domestic macroeconomic development affecting the sector, in both cases taking mostly the perspective of developing countries. The rest of this chapter is organized as follows. In Section 1, we define the main macroeconomic topics that we will cover and their links to agriculture. Section 2 presents a brief characterization of differentiated structural issues in developing countries economy in general and the agricultural sector in particular as a background for a more detailed analysis of world macroeconomic conditions and trends (Section 3) and of domestic macroeconomic policies (Section 4). Section 5 concludes by trying to weave a narrative with the performance of the agricultural sector in developing countries during the last half-century in light of world and domestic macroeconomic issues analyzed in the previous two sections and to present some speculative thoughts about the future evolution of the sector in those countries. |
3A1831634716.jsonld | Chapter 25. Inequality, Technology and the Social Contract | The distribution of human capital and income lies at the center of a nexus of forces that shape a country’s economic, institutional and technological structure. I develop here a unified model to analyze these interactions and their growth consequences. Five main issues are addressed. First, I identify the key factors that make both European-style “welfare state” and US-style “laissez-faire” social contracts sustainable; I also compare the growth rates of these two politico-economic steady states, which are not Pareto-rankable. Second, I examine how technological evolutions affect the set of redistributive institutions that can be durably sustained, showing in particular how skill-biased technical change may cause the welfare state to unravel. Third, I model the endogenous determination of technology or organizational form that results from firms’ tailoring the flexibility of their production processes to the distribution of workers’ skills. The greater is human capital heterogeneity, the more flexible and wage-disequalizing is the equilibrium technology. Moreover, firms’ choices tend to generate excessive flexibility, resulting in suboptimal growth or even self-sustaining technology-inequality traps. Fourth, I examine how institutions also shape the course of technology; thus, a world-wide shift in the technology frontier results in different evolutions of production processes and skill premia across countries with different social contracts. Finally, I ask what joint configurations of technology, inequality and redistributive policy are feasible in the long run, when all three are endogenous. I show in particular how the diffusion of technology leads to the “exporting” of inequality across borders; and how this, in turn, generates spillovers between social contracts that make it more difficult for nations to maintain distinct institutions and social structures. |
3A1831650274.jsonld | Chapter 17. Taxes in Cities | Most cities enjoy some autonomy over how they tax their residents, and that autonomy is typically exercised by multiple municipal governments within a given city. In this chapter, we document patterns of city-level taxation across countries, and we review the literature on a number of salient features affecting local tax setting in an urban context. In OECD countries, urban local governments on average raise some 10% of total tax revenue, and in non-OECD countries, they raise around half that share. We show that most cities are highly fragmented: urban areas with more than 500,000 inhabitants are divided into 74 local jurisdictions on average. The vast majority of these cities are characterized by a central municipality that strongly dominates the remaining jurisdictions in terms of population. These empirical regularities imply that analyses of urban taxation need to take account of three particular features: interdependence among tax-setting authorities (horizontally and vertically), jurisdictional size asymmetries, and the potential for agglomeration economies. We survey the relevant theoretical and empirical literatures, focusing in particular on models of asymmetric tax competition, of taxation and income sorting, and of taxation in the presence of agglomeration rents. |
3A1831653796.jsonld | Chapter 2. Nonproduction Benefits of Education : Crime, Health, and Good Citizenship | A growing body of work suggests that education offers a wide range of benefits that extend beyond increases in labor market productivity. Improvements in education can lower crime, improve health, and increase voting and democratic participation. This chapter reviews recent developments on these “nonproduction” benefits of education. |
3A1831651149.jsonld | Chapter 2. Multinational Firms and the Structure of International Trade | This chapter reviews the state of the international trade literature on multinational firms. This literature addresses three main questions. First, why do some firms operate in more than one country while others do not? Second, what determines in which countries production facilities are located? Finally, why do firms own foreign facilities rather than simply contract with local producers or distributors? We organize our exposition of the trade literature on multinational firms around the workhorse monopolistic competition model with constant-elasticity-of-substitution (CES) preferences. On the theoretical side, we review alternative ways to introduce multinational activity into this unifying framework, illustrating some key mechanisms emphasized in the literature. On the empirical side, we discuss the key studies and provide updated empirical results and further robustness tests using new sources of data. |
3A1831639009.jsonld | Chapter 18 The economics of disability and disability policy | We discuss and critique the main lines of economic research that address the economic status and behavior of the working-age population of people with disabilities. We define this population as those with physical or mental limitations that impede their daily activities or their productivity on the job. Using this definition, we assess the prevalence, trend, and composition of the population of disabled working-aged people in the United States and other Western societies, and document the extent of market work among this population. Such market work contributes to the economic well-being of the working-age disabled, but for most of them, income from public transfers and from the earnings of other household members are crucial in determining the level of family economic well-being. Relative to the nondisabled, those with disabilities have substantially lower levels of economic well-being in spite of public income support programs. While public income support is important in sustaining the level of well-being of the disabled, these policies also have serious incentive effects, especially labor supply disincentives. We document these incentive effects in US policy, and review the research studies that estimate the response of disabled people to these incentives. In addition to income support policy, we also describe public policy toward disabled people associated with antidiscrimination legislation, rehabilitation and training programs, income support for poor disabled children, and public regulations and financial support for special education in schools. We conclude by comparing US disability policy with that in other Western industrialized countries and identifying research issues that are relevant to all societies with advanced policies toward working-age people with disabilities. |
3A1831645076.jsonld | Chapter 3 Spatial aspects of environmental economics | Environmental problems have a spatial dimension because environmental media are defined over space. Environmental quality at one point in space is influenced by the spatial transfer of pollutants and the interdependence of spatial points via economic mechanisms. This chapter discusses the problem of environmental allocation in space that consists in analyzing environmental interactions occurring in space; in determining spatial patterns of environmental use; in specifying the impact of economic activities on environmental allocation in space; and in discussing the influence of alternative institutional settings on the spatial dimensions of the environment. The equalization of prices for emissions is established under specific conditions such as the linear-homogeneity of overall sectorial production functions in which the production and abatement activities are captured. In a national allocation context a division of labor in space tends to imply a difference in regional environmental qualities even if the emission price is identical among regions. Environmental abundance is one additional factor explaining international specialization; comparative environmental advantage has to rule in the long run similarly as advantages with respect to labor, capital and land. |
3A1831648415.jsonld | Chapter 14. Local Labor Markets | I examine the causes and the consequences of differences in labor market outcomes across local labor markets within a country. The focus is on a long-run general equilibrium setting, where workers and firms are free to move across localities and local prices adjust to maintain the spatial equilibrium. In particular, I develop a tractable general equilibrium framework of local labor markets with heterogenous labor. This framework is useful in thinking about differences in labor market outcomes of different skill groups across locations. It clarifies how, in spatial equilibrium, localized shocks to a part of the labor market propagate to the rest of the economy through changes in employment, wages and local prices and how this diffusion affects workers welfare. Using this framework, I address three related questions. First, I analyze the welfare consequences of productivity differences across local labor markets. I seek to understand what happens to the wage, employment and utility of workers with different skill levels when a local economy experiences a shift in the productivity of a group of workers. Second, I analyze the causes of productivity differences across local labor markets. To a large extent, productivity differences within a country are unlikely to be exogenous. I review the theoretical and empirical literature on agglomeration economies, with a particular focus on studies that are relevant for labor economists. Finally, I discuss the implications for policy. |
3A1831636123.jsonld | Chapter 29 The Economics of Biodiversity | The conservation of biodiversity is a major environmental issue, one that promises to remain at or near the top of the environmental agenda for the foreseeable future. The loss of biodiversity affects human welfare as well as being lamentable for its own sake. Humans depend on natural systems to produce a wide variety of ecosystem goods and services, ranging from direct use of certain species for food or medicines to ecosystem functions that provide water purification, nutrient retention or climate regulation. Threats to biodiversity include habitat loss and fragmentation, the introduction of nonindigenous species, over-harvesting, pollution, changes in geochemical cycles and climate change. Sustaining biodiversity in the face of increasing human populations and increased human economic activity promises to be a major challenge. Economists have an important role to play in helping to develop and evaluate conservation strategies. Because biodiversity is at risk in large part because of human activity, finding ways to conserve biodiversity will come from better understanding and management of human affairs, not from better biology alone. Economists can help set priorities to allocate scarce conservation resources where they will do the most good. Economists can help design incentive schemes to make conservation policy both effective and efficient. Economic methods can shed light on what are the most valuable components of biodiversity, including analysis of species existence value, the value of bioprospecting and the value of ecosystem services. |
3A1831634090.jsonld | Chapter 3 Forecast Evaluation | This chapter summarizes recent literature on asymptotic inference about forecasts. Both analytical and simulation based methods are discussed. The emphasis is on techniques applicable when the number of competing models is small. Techniques applicable when a large number of models is compared to a benchmark are also briefly discussed. |
3A1831638363.jsonld | Chapter 13 Commodity futures and options | Organized exchanges have evolved methods for enforcing contracts, which allow the contracts themselves to be traded at low cost. Theorists have modeled futures contracts as tools for risk management, despite an extensive empirical literature that does not support predictions about bias in prices or speculators' behavior. Another perspective models commercial firms as using futures contracts to arbitrage, to minimize transaction costs, to substitute temporarily for merchandising contracts. Because commercial firms tie their processing and storage decisions to the constellation of futures prices, futures prices have major allocative effects, even if their forecasting power is inevitably poor. |
3A1831643111.jsonld | Chapter 46 The contributions of endogenous growth theory to the analysis of development problems: An assessment | The old growth theory influenced the theory of economic development in several ways. Starting with the basic HarrodDomar structure of capacity growth, development economists paid attention to the constraints posed by savings and the efficiency with which savings are utilized. Growth theory has been liberated from the confines of the competitive market framework of earlier endogenous growth models in which dynamic externalities played the central role, even considering the models of Kaldor who repeatedly emphasized the importance of imperfect competition in the context of endogenous technical progress, the current models drawing upon the advances in industrial organization theory are more satisfactory. In particular, the emphasis on new goods and the fixed costs in introducing them provides valuable new insights. The chapter discusses the major impact of this literature on development theory has been in the area of trade and technological diffusion in an international economy. |
3A1831631989.jsonld | Chapter 15 Antitrust | This is a survey of the economic principles that underlie antitrust law and how those principles relate to competition policy. We address four core subject areas: market power, collusion, mergers between competitors, and monopolization. In each area, we select the most relevant portions of current economic knowledge and use that knowledge to critically assess central features of antitrust policy. Our objective is to foster the improvement of legal regimes and also to identify topics where further analytical and empirical exploration would be useful. |
3A1831639459.jsonld | Chapter 14 Resuscitating real business cycles | The Real Business Cycle (RBC) research program has grown specularly over the last decade, as its concepts and methods have diffused into mainstream macroeconomics. Yet, there is increasing skepticism that technology shocks are a major source of business fluctuations. This chapter exposits the basic RBC model and shows that it requires large technology shocks to produce realistic business cycles. While Solow residuals are sufficiently volatile, these imply frequent technological regress. Productivity studies permitting unobserved factor variation find much smaller technology shocks, suggesting the imminent demise of real business cycles. However, we show that greater factor variation also dramatically amplifies shocks: a RBC model with varying capital utilization yields realistic business cycles from small, nonnegative changes in technology. |
3A1831643774.jsonld | Introduction | This publication titled Handbook of Development Economics, volume 4takes stock of some of the newer trends and their implications for research in the field and our understanding of economic development. First, the micro-economic orientation of the field is increasingly evident, and is reflected here. Economic behavior is traced from the individual to family and in some cases to the local schools or communities and labor markets. Because most people in poor countries continue to work in agriculture, the focus is often on the family farm and includes household production. A second emerging feature of the field is an interest in explaining how institutions develop and operate in low-income countries, or political economy. A third change in the field is the vast improvement in data, primarily in the form of household surveys and censuses combined with local community modules which facilitate the identification of causal effects from outside of the household, in terms of environmental factors, relative prices, local policies and facilities, in which the response of individuals, families, and communities to policies may be heterogeneous. A variety of econometric methods have become commonplace, relying on improved panel and community data which allow the introduction of fixed effects and provide more credible instruments for program treatment when randomized designs are not feasible, and have arguably attenuated or eliminated some of the more obvious sources of estimation bias. A fourth development is the alternative strategies adopted to evaluate the effects of policy initiatives, including the selection of who participates in the policy programs from among those who are eligible to participate. |
3A1831642468.jsonld | Chapter 10 The supply of money and the control of nominal income | This chapter discusses various aspects of the relation between the supply of money and nominal income and their implications for the conduct of monetary policy. It focuses on the traditional versions of the monetary mechanismthe mechanism through which the monetary authority endeavors to control nominal income. In these versions, the monetary aggregate controlled by the central bank is money as traditionally defined to consist of all the means of payment and the control is assumed to be complete. It examines the nature and stability of the income velocity of the narrow measure of money implied by four basic macroeconomic models: (1) the classical model of the quantity theory of money, (2) a model combining the classical assumptions of perfect price flexibility, (3) the Keynesian model of liquidity preference, and (4) a general macroeconomic model. All models have been expressed in comparable specifications and incorporate additive stochastic terms. The chapter discusses the process of creation of money; money is neither created directly nor rigidly controlled by the central bank. A general issue of the feasibility and desirability of endeavoring to control nominal income through financial aggregates other than the money supply as conventionally defined is also discussed. |
3A1831647974.jsonld | Chapter 10 Producers theory | The producers theory is concerned with the behavior of firms in hiring and combining productive inputs to supply commodities at appropriate prices. Two sets of issues are involved in this process: one is the technical constraints, which limit the range of feasible productive processes, while the other is the institutional context such as the characteristics of the market where commodities and inputs are purchased and sold. The chapter describes the set of axiomatic approaches to production technology and the neoclassical theory of the multi-product and multi-input firm. It is an attempt to set forth the general framework of analysis that underlies neoclassical producer decision theory. The chapter discusses the properties of the production function, its various forms, and applications of the duality principles and also provides a brief discussion of the CambridgeCambridge controversy insofar as it pertains to the existence and usefulness of production functions. The chapter also presents three special cases of the theory of the firm in which new research has appeared, specifically dynamic input disequilibrium models, response to regulatory constraints, and optimal price and output decisions in multi-product firms. |
3A1831643812.jsonld | Chapter 60 Evaluating Social Programs with Endogenous Program Placement and Selection of the Treated | This chapter considers methods for evaluating the impact of social programs in the presence of nonrandom program placement or program selection. It first presents the evaluation problem as a missing data problem and then considers various solutions proposed in the statistics and econometrics literature. For ex post evaluation, the following estimation methods are discussed: traditional regression methods, matching, control function methods, instrumental variable and local instrumental variable (LIV) methods, and regression-discontinuity. Alternative estimators are described along with their identifying assumptions, the behavioral implications of those assumptions, and the data requirements for implementation. The chapter also considers methods for ex ante evaluation, which can be used to assess the effects of programs prior to their implementation, for example, in trying to design a program that achieves some desired outcomes for a given cost. Throughout the chapter, numerous examples from the development literature illustrate applications of the different estimation methods and highlight factors affecting estimator performance. |
3A1831632012.jsonld | Chapter 12 Corporate Law and Governance | This chapter surveys the theoretical and empirical research on the main mechanisms of corporate law and governance, discusses the main legal and regulatory institutions in different countries, and examines the comparative governance literature. Corporate governance is concerned with the reconciliation of conflicts of interest between various corporate claimholders and the resolution of collective action problems among dispersed investors. A fundamental dilemma of corporate governance emerges from this overview: large shareholder intervention needs to be regulated to guarantee better small investor protection; but this may increase managerial discretion and scope for abuse. Alternative methods of limiting abuse have yet to be proven effective. |
3A183164195X.jsonld | Chapter 1 The game of chess | The game of chess has sometimes been referred to as the Drosophila of artificial intelligence and cognitive science research a standard task that serves as a test bed for ideas about the nature of intelligence and computational schemes for intelligent systems. Both machine intelligence how to program a computer to play good chess (artificial intelligence) and human intelligence how to understand the processes that human masters use to play good chess (cognitive science) are discussed in the chapter but with emphasis on computers. Classical game theory has been preoccupied almost exclusively with substantive rationality. Procedural rationality is concerned with procedures for finding good actions, taking into account not only the goal and objective situation, but also the knowledge and the computational capabilities and limits of the decision maker. The only nontrivial theory of chess is a theory of procedural rationality in choosing moves. The study of procedural or computational rationality is relatively new, having been cultivated extensively only since the advent of the computer (but with precursors, e.g., numerical analysis). It is central to such disciplines as artificial intelligence and operations research. Difficulty in chess is computational difficulty. Playing a good game of chess consists in using the limited computational power (human or machine) that is available to do as well as possible. This might mean investing a great deal of computation in examining a few variations, or investing a little computation in each of a large number of variations. Neither strategy can come close to exhausting the whole game tree. |
3A1831633876.jsonld | Chapter 1 Introduction to the Economics of Giving, Altruism and Reciprocity | Altruism, giving and pro-social conduct, and reciprocity, are the basis of the existence and performance of societies, through their various occurrences: in families; among the diverse motives of the political and public sector; as the general respect and moral conduct which permit life in society and exchanges; for remedying failures of markets and organizations (which they sometimes also create); and in charity and specific organizations. Altruism has various origins: it can be hedonistic or natural altruism in empathy, affection, sympathy, emotional contagion, pity, and compassion; or normative altruism of the moral, non-moral social, and rational types. Giving can be altruistic, aimed at producing some social effect in the fields of social sentiments, situations or relations, an intrinsic norm, or self-interested. Reciprocity, in which a gift elicits another gift, is a pervasive social relation due to either a desire of balance (and possibly fairness), or to liking a benevolent giver (moreover, self-interested sequential exchanges look like it). Joint giving for alleviating poverty and need makes giving a contribution to a pure public good for which efficient public transfers crowd out private gifts. Yet, private giving can be an intrinsic norm or a demand of reason, or it can be motivated by the non-moral concern about judgments of others or of oneself. Families the institutions for love and giving are networks of reciprocities. Intertemporal giving includes gifts to future generation through bequests, and to earlier generations through the relevant public indebtedness (retro-gifts). Normative opinions about societies, and in particular about justice, imply and require altruism and constitute a form of it. Moreover, altruism is the mark of good social relations and good persons. Altruism and giving have always been analysed by economics, notably by all great economists, with an upsurge of studies in the last third of the 20th century. |
3A730015998.jsonld | An empirical investigaton of political economy factors behind structural reforms in OECD countries | This paper was originally prepared for the OECD Working Party No. 1 under the authority of the OECD’s Economic Policy Committee. Jens Høj and Giuseppe Nicoletti work for the OECD Economics Department as a senior economist in the Country Studies Branch and as Head of the Structural Policy Analysis Division 1, respectively. Vincenzo Galasso is an Associate Professor of Economics at Università Bocconi in Italy and Thai-Thang Dang is a private sector consultant. The authors wish to thank Jean Philippe Cotis, Jørgen Elmeskov, Michael P. Feiner, Christopher Heady, Nick Johnstone and many other colleagues in the OECD Economics Department as well as representatives from OECD member countries for useful comments on a previous version of the paper. |
3A1831643944.jsonld | Chapter 47 Economic Development and the Decline of Agricultural Employment | This chapter considers the linkages between agricultural development and rural non-farm activities. The chapter is motivated by growing evidence that non-farm activities provide an increasingly important share of rural incomes in many low-income questions, questions about whether increasing agricultural productivity is a necessary precondition for raising incomes and reducing poverty in rural areas, and increased evidence of factor and commodity flows between rural and urban areas. Unfortunately, the existing literature is sparse and has not been sufficiently attentive to the underlying structures and mechanisms that drive the relationship between agricultural productivity and rural non-farm change. A particular weakness of this literature is the lack of attention given to the importance of flows of both capital and labor. The reason for this is in part due to the limitations of existing data. An assessment of the strengths and weaknesses of existing data sets is thus also provided, with particular attention to panel data sets that might be useful for assessing the extent of geographic mobility. In order to clarify the relevant issues the Chapter presents a model of the rural economy that permits examination of the linkages between agricultural development and non-farm employment under different regimes distinguished by the mobility of capita and labor. Basic features of the model are then tested using newly available data from South Asia. The Chapter concludes with suggestions for future data collection efforts as well as the development of more sophisticated models of the rural economy. |
3A73004145X.jsonld | Loyalty and Fidelity Discounts and Rebates | As with other policies offering lower prices to at least some buyers, loyalty and fidelity discounts are generally pro-competitive and beneficial to consumers even though they may harm certain competitors. Potential problems exist, however, when such discounts are employed in ways that reduce price transparency, exclude or restrict a significant number of actual or potential competitors, or raise the probability of anticompetitive co-ordination. The sometimes complex pro- and anti-competitive effects of loyalty and fidelity discounts are explored in the executive summary, background paper and summary of discussion pertaining to a June 2002 OECD Competition Committee roundtable discussion of the topic. While these documents reveal some interesting policy differences among various members of the Competition Committee, they also point to general agreement that loyalty and fidelity discounts are more likely to raise competition concerns when practised by firms enjoying substantial market power. |
3A183164746X.jsonld | Chapter 2 The normative theory of international trade | Normative economics is concerned with making welfare judgments about policies and economic events. This chapter discusses government policies. In the case of trade theory, commercial policy-normative economics embraces the study of the welfare consequences of various events when policies are constant. The chapter covers the main areas of normative trade theory, but not fully. The chapter discusses central parts of policy-orientated normative trade theory on the terms of trade argument for protection. It also provides an overview on theory of domestic distortions. A major result has been downgrading the role of trade policy and thus rehabilitating the case for free trade, at least aside from the orthodox optimal tariff argument. Most arguments for protection, other than the terms of trade argument, turned out to originate in some market failure in the domestic economysome domestic divergence between prices and marginal costs. The first-best policy is then to deal with this divergence directly. |
3A1831635070.jsonld | Chapter 31 Cultural Districts and Their Role in Developed and Developing Countries | The aim of this chapter is to analyze the economic properties and the institutions governing the start-up and evolution of cultural districts. Cultural districts are a good example of economic development based on localized firms and local culture. The first part of the chapter (Sections 1–2) reviews the relationships between culture, viewed as an idiosyncratic good, and the Marshallian theory of industrial districts. Sections 3 and 4 of the paper present a discussion of two models of cultural districts: the industrial cultural district (mainly based on positive externalities, localized culture, and traditions in “arts and crafts”), and the institutional cultural district (mainly based on property rights assignment and symbolic values). Policy issues are analyzed in Section 5, with particular reference to the applicability of the two models of cultural districts in developed and developing countries. |
3A730015904.jsonld | The Contribution of Housing Markets to Cyclical Resilience | This paper examines the linkages between housing markets and the business cycle in OECD countries, focusing on how differences in the degree of resilience to economic shocks can be affected by the structural characteristics of housing and mortgage markets. The paper focuses specifically on: the transmission channel from housing wealth to consumption and on the factors behind house price variability, which help to determine whether the housing sector plays a stabilising role or not. |
3A1831631954.jsonld | Chapter 18 Antidiscrimination Law | This essay provides an overview of the central theoretical law and economics insights and empirical findings concerning antidiscrimination law across a variety of contexts including discrimination in labor markets, housing markets, consumer purchases, and policing. The different models of discrimination based on animus, statistical discrimination, and cartel exploitation are analyzed for both race and sex discrimination. I explore the theoretical arguments for prohibiting private discriminatory conduct in light of the tensions that exist between concerns for liberty and equality. I also discuss the complexities in empirically establishing the existence of discrimination and highlight the critical point that one cannot automatically attribute observed disparities in various economic or social outcomes to discrimination. The major empirical findings showing the effectiveness of federal law in the first decade after passage of the 1964 Civil Rights Act are contrasted with the generally less optimistic findings from more recent antidiscrimination interventions. |
3A1831638908.jsonld | Chapter 28 Regulation of prices and investment in hospitals in the United States | With the spread of cost-based hospital payment systems in the United States in the 1960s, and the implementation of the Medicare and Medicaid programs in 1966, rapidly rising hospital costs imposed unexpected pressures on Federal and state budgets and generated a demand for regulatory interventions. Large numbers of states responded with regulatory controls on hospital investment and a significant minority of states enacted hospital price regulation (rate-setting) laws. As strong hospital sector inflation continued into the 1970s, Federal efforts to regulate prices (through the Economic Stabilization Program) and to encourage additional state regulation were also enacted. This chapter reviews the economic research on the impact of these regulatory interventions, focusing on econometric studies in particular. Several conclusions emerge from this review. First, studies of adoption of regulation show that pressure on state budgets and pro-regulation political views were more influential than “provider capture” or “rent-seeking” factors. Second, cost-containment impacts of state rate-setting programs varied over time, with changes in the national health care economy and major Federal policy thrusts. Third, there is little evidence that investment controls reduced the rate of cost growth though inconsistent reports of constraining effects on numbers of beds and diffusion of some specialized services did appear. Fourth, econometric studies of the Medicare Prospective Payment System (PPS) supported the presumption that PPS would constrain the growth in cost per case, but concomitant increases in case-mix intensity and declines in admissions raised questions about (1) the extent to which PPS truly induced efficiency gains and (2) the adequacy of our analytic models of hospital behavior. Fifth, as cost-based payment was replaced by prospective payment in Medicare, Medicaid and the private sector, and as managed care encouraged price competition, the evidence of regulatory cost savings dwindled and rate regulation virtually disappeared. While investment regulation is still widespread, its role and effect in the new hospital marketplace is still unclear. |
3A730015491.jsonld | Sub-central government fiscal rules | Rules constraining the discretionary powers of budget policymakers have become widespread among OECD economies, and the expanding role played by decentralised institutions in providing public services has led to their increasing adoption at the sub-central level. |
3A729993736.jsonld | Corporate sector vulnerability and aggregate activity | The health of a firm’s balance sheet potentially plays a role in its decisions to invest and through that channel, aggregate activity can be affected. Several authors have established a theoretical link based on the notion that the value of equity can be collateralised for business loans used to fund capital accumulation. In some of these models, it is possible to demonstrate that there is a financial accelerator that can amplify the business cycle by more than what could be explained by, for instance, an interest rate channel. |
3A1831642603.jsonld | Chapter 26 The economics of health, safety, and environmental regulation | Public concern and scientific research on health, safety, and environmental externalities (HSE) lured a number of economists to apply their tools and models to these issues. The materials balance model and the environmental models of are examples of incorporating HSE externalities into standard economic models. These enriched models have attracted a good deal of attention from both theorists and applied economists. The chapter reviews the economics of health, safety, and environmental regulation cites work of a large number of people trained in disciplines other than economics. The lesson appears to be that economists are narrowly bound by the models and view of what are interesting problems and approaches. When a movement as sweeping and important as the environmentalistconsumerist movement occurs, economists should not be complaining two decades later that government programs are not efficient. Tackling HSE issues is inherently difficult, because they involve some of the thorniest issues in economics: paternalism, public goods, information, and incentives for innovation, uncertainty, valuing nonmarket goods and services, and modeling unanticipated consequences of actions. Indeed the set of issues is so large and fascinating, it would provide employment for a great many theorists. The economics of HSE regulation has come from somewhat sterile arguments about Coase versus Pigou to a rich array of models, parameter estimates, and policy advice. |
3A1831631709.jsonld | Chapter 4. Global Demographic Trends : Consumption, Saving, and International Capital Flows | In this chapter we review the recent literature on the effects of changing global demographic trends on consumption, factor prices and social security. We also construct an overlapping generation model with four regions of the world. The model is calibrated so that we match some basic statistics of the last few decades. We assume that the model was in a steady state in 1990, input projected demographic trends, which converge to common values across regions by 2200, and make suitable assumptions on productivity profiles and total factor productivity. This allows us to study the evolution of factor prices, current accounts, and welfare during the transition and explore the differences between open and closed economies, when we limit factor mobility to capital mobility and make different assumptions about future trends in demographics and productivity. |
3A1831639319.jsonld | Chapter 23 Issues in the design of monetary policy rules | This chapter begins with a number of important preliminary issues including the distinction between rules and discretion in monetary policy; the feasibility of committed rule-like behavior by an independent central bank; and optimal control vs. robustness strategies for conducting research. It then takes up the choice among alternative target variables — with the most prominent contenders including price level, nominal income, and hybrid (inflation plus output gap) variables — together with the issue of growth-rate vs. growing-level target path specifications. One conclusion is that inflation and nominal income growth targets, but not the hybrid target, would have induced fairly similar policy responses in the US economy over 1960–1995. With regard to instrument choice, the chapter argues that both nominal interest rate and monetary base measures are feasible; this discussion emphasizes the basic conceptual distinction between nominal indeterminacy and solution multiplicity. Accordingly, root-mean-square-error performance measures are estimated for interest rate and base instruments (with nominal income target) in the context of a VAR model. Other topics emphasized in the chapter include the operationality of policy-rule specifications; stochastic vs. historical simulation procedures; interactions between monetary and fiscal policies; and the recently-developed fiscal theory of the price level. |
3A730011224.jsonld | Construction Industry | The OECD Competition Committee debated issues related to the Construction Industry in June 2008. This roundtable addressed the special characteristics of the construction industry as they relate to competition law and policy. Construction is a critical sector in OECD economies because it builds and maintains the structures and infrastructure on which almost every other industry depends. Unfortunately, the construction industry has also tended to suffer from cartel activity, as shown by a spate of well - publicised recent matters from around the world. The roundtable includes an examination of why this industry seems to be more prone to cartel formation than other industries. It also looked into the complications that may arise when multiple construction firms use the same bid calculation software. Finally, the Committee discussed the arguments – occasionally made by industry advocates – that competition is either irrelevant or “ruinous” in the construction industry. Neither argument was found to be persuasive, as there are no distinguishing features of the construction sector that reduce the benefits that competition brings to consumer welfare. |
3A730037924.jsonld | International Regulatory Activities | This revised proposal,1 adopted by the European Commission on 26 November 2008, replaces and updates the one tabled in September 2004.2 It is based on the principles and requirements of both the Convention on Nuclear Safety3 (CNS) and the International Atomic Energy Agency (IAEA) Safety Fundamentals. |
3A1831654644.jsonld | Chapter 74. The Place of Nature in Economic Development | In this chapter both theory and empirics are used to show that our picture of the processes of economic development changes radically when nature is introduced as a capital asset. Particular features of institutions that fashion societies' use of the natural-resource base are identified and analyzed. It is also shown that conventional measures of human welfare are inadequate for identifying sustainable development. A comprehensive measure of an economy's wealth is developed and shown to be the correct index to use both for assessing the sustainability of economic development and for evaluating policies. |
3A323412904.jsonld | Hecke Algebras, Difference Operators, and Quasi-Symmetric Functions | We define a new action of the symmetric group and its Hecke algebra on polynomial rings whose invariants are exactly the quasi-symmetric polynomials. We interpret this construction in terms of a Demazure character formula for the irreducible polynomial modules of a degenerate quantum group. We use the action of the generic Hecke algebras to define quasi-symmetric and noncommutative analogues of Hall-Littlewood functions. We show that these generalized functions share many combinatorial properties with the classical ones. |
3A1831651424.jsonld | Chapter 3. Contemporary Experimental Aesthetics: Procedures and Findings | An aesthetic experience with visual art and the resulting perceived ‘beauty’ of it depend on a complex interaction among characteristics of the art object, the observer, and the physical, social, and historical contexts in which the experience takes place. Experimental aesthetics is devoted to the study of forms of behavior that center around observers’ interactions with works of art and other aesthetic phenomena using a variety of research techniques and controlled observation. The purpose of this chapter is to provide the reader with an overview of the diversity of research techniques and procedures employed in the last decade to understand and explain the underlying processes that contribute to an observer’s aesthetic experiences with a variety of visual art forms, including painting, film, photography, sculpture, cuisine, design products, and dance. The chapter is divided into the following sections to achieve its goal: artworks as stimuli, processes underlying an aesthetic experience with different visual art forms, the contribution of viewer characteristics to his or her experience with art, and the art museum as laboratory. |
3A729989798.jsonld | The Decommissioning of Asse II : Burden of the Past in the Federal Republic of Germany | Asse II, a salt mine in the salt formation of the Upper Permian near Wolfenbüttel, has been the subject of heated debates on environmental policy and law in the Federal Republic of Germany for some time. Until 1995, Asse II was used as a trial facility for the development of techniques for the final disposal of low and intermediate level radioactive waste. Potash and salt rock were produced in this facility from 1909 and 1964 and, after termination |
3A1831637405.jsonld | Chapter 10 Regional econometric and dynamic models | This chapter focuses on regional econometric and dynamic models. Regional econometric models are concerned with the description, analysis, forecasting, and policy appraisal of economic development within a set of localities or regions. Such models concern not only internal structures and relationships, but also interregional interrelationships. A wide class of models has been developed for the purposes of regional economic analysis and many are concerned with the dynamics of income, demand, supply, and investment determination; others are concerned with more slowly changing structural properties relating to the layout of facilities and infrastructure and some concern the extremely rapid adjustments in the flows of people, commodities, and resources among regions. The chapter provides some major examples of dynamic regional models and discusses the methods of approach and the general linear model. A review of specification and estimation methods for a wide class of problems including nonlinear and nonstationary structures is presented in the chapter. It also briefly discusses the application of regional models to policy specification and provides a summary of research priority areas. |
3A730031861.jsonld | National Legislative and Regulatory Activities | BELARUS Amendments to laws on the use of atomic energy (2009) Criminal law on acts concerning the use of radioactive sources and administrative law for non-criminal violations of radiation safety requirements (2009) EGYPT Law on activities in the nuclear and radiation field (2010) FRANCE Decree establishing a Committee on industrial co-ordination of radioactive waste (2010)Law on the recognition and indemnification of victims of nuclear tests conducted by France (2010) GERMANY Tenth Amendment to the Atomic Energy Act (2010) Act on Environmental Impact Assessment (2009) Radiation Protection Commission (2009) Act on the Protection against Non-ionizing Radiation (2009) International transport of dangerous goods by road (2009) IRELAND Order to amend Regulations on Active Implantable Medical Devices (2010)Amendment to Medical Devices Regulations (2010) ITALY Decree setting out rules for the siting, construction and operation of nuclear installations (2010) ROMANIA Law on the reorganisation of public authorities (2009) Government Decision on the reorganisation of electric power producers (2010) SLOVAK REPUBLIC Amendment of the Atomic Act (2009) SPAIN Law regulating limited investment companies quoted on the real estate market (2009) UKRAINE Overview of recent amendments to laws in the field of nuclear energy (2009) |
3A1831647575.jsonld | Chapter 34 The intertemporal approach to the current account | A country's current-account balance over any time period is the increase in Residents' claims on foreign incomes or outputs, less the increase in similar foreign-owned claims on home income or output. Thus, in theory, the current account includes not only exports less imports (broadly defined to include all the income on and payouts on cross-border assetsdividends, interest payments, insurance premia and payments, etc.), but also net capital gains on existing foreign assets. F The intertemporal approach views the current-account balance as the outcome of forward-looking dynamic saving and investment decisions. This chapter surveys the theory and empirical work on the intertemporal approach to the current account as it has developed since the early 1980s. Recently, some researchers have studied dynamic stochastic international models with complete ArrowDebreu forward markets for uncertain consumption. This particular offshoot of the intertemporal approach is the complete-markets model. The intertemporal approach to current-account analysis extends the absorption approach through its recognition that private saving and investment decisions, and sometimes even government decisions, result from forward-looking calculations based on the expectations of future productivity growth, government spending demands, real interest rates, and so on. |
3A1831653125.jsonld | Chapter Eleven. Health Care Spending Risk, Health Insurance, and Payment to Health Plans | This chapter will deal with the actual and efficient functioning of health insurance in settings where risk (expected value) of medical spending or insurance benefits varies across individuals at a given point in time or over time for a given individual. It will deal with equilibrium in insurance markets with risk variation and will also deal with various configurations of information, the impacts on such markets of regulation motivated by risk variation, and the actual and optimal impact of governmental policies to deal with risk variation in national insurance systems. |
3A1831642808.jsonld | Chapter 10 Price discrimination | As we indicated at the beginning of this chapter, price discrimination is a ubiquitous phenomenon. Nearly all firms with market power attempt to engage in some type of price discrimination. Thus, the analysis of the forms that price discrimination can take and the effects of price discrimination on economic welfare are a very important aspect of the study of industrial organization. In this survey we have seen some of the insights offered by the economic theory of price discrimination. However, much work remains to be done. For example, the study of marketing behavior at the retail level is still in its infancy. Retail firms use a variety of marketing devices — sales, coupons, matching offers, price promotions, and so on — that apparently enhance sales. The marketing literature has examined individual firm choices of such promotional tools. But what is the ultimate effect of such promotions on the structure and performance of market equilibrium? What kinds of marketing devices serve to enhance economic welfare and what kinds represent deadweight loss? One particularly interesting set of questions in this area that has received little attention concerns the computational costs involved in using complex forms of price discrimination. In the post-deregulation airline industry of the United States, airlines have taken to using very involved pricing schemes. Finding the most inexpensive feasible fight may involve a considerable expenditure of time and effort. What are the welfare consequences of this sort of price discrimination? Do firms appropriately take into account the computational externality imposed on their customers? Even in more prosaic case of public utilities, pricing schedules have become so complex that households often make the “wrong” choice of telephone service or electricity use. Questions of simplicity and ease-of-use have not hitherto played a role in the positive and normative analysis of price discrimination. Perhaps this will serve as a fruitful area of investigation in future studies of price discrimination. |
3A1831632306.jsonld | 3. General Equilibrium and Multiple Market Systems | Market interdependence is pervasive through all economies and it has attracted interest since the beginning of economics. Throughout history theories about the nature and consequences of interdependence have been the foundation of powerful and conflicting philosophies. The modern theory of general equilibrium that emerged from a century-long controversy holds that economies can be understood as a large system of simultaneous equilibrium equations. And, while the theory itself is highly technical, it holds profound implications about the role played by specialization and the law of comparative advantage in the creation of wealth. Almost all textbooks claim that self interest in response to profits promotes wealth-creating specialization and that prices serve as a key coordinating vehicle as described by the system of equilibrium equations. |
3A730001660.jsonld | The Convention on Supplementary Compensation for Nuclear Damage : Catalyst for a Global Nuclear Liability Regime | Nuclear power can help address many of our world’s most pressing concerns. It is a clean, reliable, economic source of energy that can be used to meet a significant portion of current demand for energy, as well as anticipated future increases in demand. Increased reliance on nuclear power to generate electricity will permit many millions of people throughout the world to experience an improved and sustainable quality of life. In addition, by decreasing dependence on fossil fuels, nuclear power can alleviate price volatility in energy markets and potential supply shortages and disruptions. Moreover, nuclear power produces large amounts of energy with no atmospheric emissions of pollutants such as NOx or SO2, and no emissions of greenhouse gases such as CO2. To address global climate change effectively, nuclear power must play an increasingly important role in meeting our world's energy needs. |
3A1831654563.jsonld | Chapter 2. On the Numerical Solution of Equilibria in Auction Models with Asymmetries within the Private-Values Paradigm | We describe and compare numerical methods used to approximate equilibrium bid functions in models of auctions as games of incomplete information. In such games, private values are modeled as draws from bidder-specific type distributions and pay-your-bid rules are used to determine transactions prices. We provide a formal comparison of the performance of these numerical methods (based on speed and accuracy) and suggest ways in which they can be improved and extended as well as applied to new settings. |
3A730010945.jsonld | Competition Law and Policy in Finland | Competition policy was at the centre of market-driven reforms since the late 1980s that restructured Finland’s network monopolies and eliminated the many vestiges of corporatist control. The pace of change is slower now, as the role of market institutions in providing traditional government services presents novel and difficult issues about quality, equity, efficiency, and choice. The role of the competition body, the Finnish Competition Authority (FCA), is also changing. In the previous stages, its principal path of influence, after it made a mark with a strong early enforcement program against tolerated price fixing, was through advice and advocacy. As competitive markets are... |
3A1831643006.jsonld | Chapter 35 Market Structure: Theory and Evidence | This chapter reviews the literature which has developed around the ‘bounds approach’ to market structure over the past fifteen years. The focus of this literature lies in explaining cross-industry differences in concentration, and in the size distribution of firms. One of the main ideas involved is that a study of these cross-industry differences offers a powerful way of uncovering the operation of some key competitive mechanisms. |
3A1783723297.jsonld | The Blackwell Companion to Eastern Christianity. Edited by Ken Parry | This is the second volume of a projected three-part survey of the churches of Eastern Christendom. (The first part, a dictionary, was published in 1999 and the third will be a collection of primary sources.) It consists of twenty-four essays, providing accounts of the different national and regional church traditions and then of the liturgy, iconography, architecture, and hagiography of the churches. It provides a full and detailed account of the various forms of Christianity which developed in the East, and has many merits. It is exhaustive, including all the churches of the Eastern tradition, of whatever christological standpoint, and also Greek Catholic churches, and in addition the extension of these communities into the West. |
3A323415296.jsonld | Convergence and Compactness Properties for a Family of 2-D Discontinuous Signals | In this paper, convergence and compactness properties for sets of possibly discontinuous functions on \mathbb{R}2̂ are discussed. The issue appears to be relevant with respect to optimization and identification problems for 2-D images.Several convergence properties are provided and compared for a class of discontinuous 2-D functions with sufficiently regular discontinuity sets.Two sufficient compactness criteria are given; the first one extends to the 2-D case previously known results on the 1-D Skorohod topology. |
3A1831634627.jsonld | Subject Index | This chapter lists the terms that have contributed to the book Handbook of Economic Growth , such as abatement, absorptive capacity, accumulation mechanism, and others. These terms have been mentioned along with the page numbers in which they have appeared in the bookfor the ease of the reader. |
3A1831634929.jsonld | Chapter 4 From Stagnation to Growth: Unified Growth Theory | The transition from stagnation to growth and the associated phenomenon of the great divergence have been the subject of an intensive research in the growth literature in recent years. The discrepancy between the predictions of exogenous and endogenous growth models and the process of development over most of human history, induced growth theorists to advance an alternative theory that would capture in a single unified framework the contemporary era of sustained economic growth, the epoch of Malthusian stagnation that had characterized most of the process of development, and the fundamental driving forces of the recent transition between these distinct regimes. The advancement of unified growth theory was fueled by the conviction that the understanding of the contemporary growth process would be limited and distorted unless growth theory would be based on micro-foundations that would reflect the qualitative aspects of the growth process in its entirety. In particular, the hurdles faced by less developed economies in reaching a state of sustained economic growth would remain obscured unless the origin of the transition of the currently developed economies into a state of sustained economic growth would be identified, and its implications would be modified to account for the additional economic forces faced by less developed economies in an interdependent world. Unified growth theory suggests that the transition from stagnation to growth is an inevitable outcome of the process of development. The inherent Malthusian interaction between the level of technology and the size and the composition of the population accelerated the pace of technological progress, and ultimately raised the importance of human capital in the production process. The rise in the demand for human capital in the second phase of industrialization, and its impact on the formation of human capital as well as on the onset of the demographic transition, brought about significant technological advancements along with a reduction in fertility rates and population growth, enabling economies to convert a larger share of the fruits of factor accumulation and technological progress into growth of income per capita, and paving the way for the emergence of sustained economic growth. Variations in the timing of the transition from stagnation to growth and thus in economic performance across countries reflect initial differences in geographical factors and historical accidents and their manifestation in variations in institutional, social, cultural, and political factors. In particular, once a technologically driven demand for human capital emerged in the second phase of industrialization, the prevalence of human capital promoting institutions determined the extensiveness of human capital formation, the timing of the demographic transition, and the pace of the transition from stagnation to growth. |
3A1831634619.jsonld | Preface to the Handbook of Economic Growth | The chapter presents the preface of the publication Handbook of Economic Growth, which is designed to communicate the state of modern growth research. The handbook consists of 28 chapters, and is divided into six parts. Part I lays out the theoretical foundations. The first chapter surveys the neo -classical and AK models of growth. The second chapter develops the Schumpeterian growth model with quality-improving innovations and confronts it with new empirical evidence. The third chapter surveys the literature that built upon Paul Romer's product variety model. The fourth chapter looks at the growth in the long run and analyzes the interplay between technical change and demographic transitions, and explores the issue of transitions between different growth regimes. The next chapter analyzes the central role of economic and political institutions, and describes the mechanisms, whereby the dynamics of political institutions interacts with the dynamics of economic institutions and that of income inequality. The following chapter focuses on the emergence and existence of poverty traps, a question of particular importance in development contexts. The final chapter further explores the interplay of growth economics and development economics, with particular attention to how factors such as credit market constraints and intersectoral heterogeneity can explain outstanding puzzles concerning capital flows and interest rates, which are major elements of the growth process. |
3A1831644495.jsonld | Chapter 28. The Economic Analysis of Immigration | The study of labor flows across labor markets is a central ingredient in any discussion of labor market equilibrium. These labor flows help markets reach a more efficient allocation of resources. This paper surveys the economic analysis of immigration. It investigates the determinants of the immigration decision by workers in source countries and the impact of that decision on the host country’s labor market. The survey stresses the ideas and models that economists use to analyze immigration, and delineates the implications of these models for empirical research and for our understanding of the labor market effects of immigration. © 1999 Elsevier Science B.V. All rights reserved. |
3A1831636727.jsonld | Chapter 36 Urban areas with decentralized employment: Theory and empirical work | This chapter discusses theoretical and applied research in urban economics on decentralized cities, i.e., cities in which employment is not restricted to the central business district. The first section discusses informally the incentives that firms face to suburbanize. The next section summarizes the theoretical literature on decentralized cities, including both models which solve for the optimal spatial pattern of employment and models in which the spatial pattern of employment is exogenously determined. In other sections, I discuss rent and wage gradients in decentralized cities and review the empirical literature testing whether, or not, wage gradients exist in urban areas. A section covers the question of whether people follow jobs or jobs follow people to the suburbs and the last section discusses the “wasteful” commuting controversy. |
3A1831652889.jsonld | Chapter 11. Financial Intermediation, Markets, and Alternative Financial Sectors | We provide a comprehensive review of firms’ financing channels (internal and external, domestic and international) around the globe, with the focus on alternative finance—financing from all the non-market, non-bank external sources. We argue that while traditional financing channels, including financial markets and banks, provide significant sources of funds for firms in developed countries, alternative financing channels provide an equally important source of funds in both developed and developing countries. Alternative finance is often the dominant source of funds for firms in fast-growing economies. We compare market and bank finance with alternative finance, along with the supporting mechanisms such as legal and institutional structures. Much more research is needed to better understand alternative finance and its role in corporate financing. We suggest ways to obtain firm-level data on various forms of alternative finance and thus overcome the main obstacle in the field. |
3A1831639629.jsonld | Chapter 2 Monetary policy shocks: What have we learned and to what end? | This chapter reviews recent research that grapples with the question: What happens after an exogenous shock to monetary policy? We argue that this question is interesting because it lies at the center of a particular approach to assessing the empirical plausibility of structural economic models that can be used to think about systematic changes in monetary policy institutions and rules. The literature has not yet converged on a particular set of assumptions for identifying the effects of an exogenous shock to monetary policy. Nevertheless, there is considerable agreement about the qualitative effects of a monetary policy shock in the sense that inference is robust across a large subset of the identification schemes that have been considered in the literature. We document the nature of this agreement as it pertains to key economic aggregates. |
3A1831634120.jsonld | Preface | The chapters in this volume were designed to cover the broad range of existing research and to suggest productive lines of development. However, even the relatively short production lags in these volumes imply that a number of new and exciting works are only hinted at in the chapters. In short, there is much more work to be done as this field unfolds. A variety of factors went into the selection of authors of these chapters. Clearly, a fundamental requirement was that the authors had to be leaders in the intellectual development of the various topics. But, beyond that, authors were selected because they had a point of view, one designed to provoke thought and new work. The ideas put forward in the chapter are likely to be challenged in further work. The idea is not to write the final word on any of these topics, because each is the source of lively current debate. The idea instead is to provide an intermediate assessment of dynamic research areas to push the research further. |
3A1831652935.jsonld | Chapter 6. Law and Finance After a Decade of Research | In the last dozen years, economists have produced a considerable body of research suggesting that the historical origin of a country’s laws is highly correlated with a broad range of its legal rules and regulations, as well as with economic outcomes. Much of this research has dealt with rules governing investor protection and their effects on financial markets. We summarize this evidence and attempt a unified interpretation. We also address several objections to the empirical claim that legal origins matter. |
3A1831654733.jsonld | Chapter 65. Financial Globalization and Economic Policies | We review the large literature on various economic policies that could help developing economies effectively manage the process of financial globalization. Our central findings indicate that policies promoting financial sector development, institutional quality, and trade openness appear to help developing countries derive the benefits of globalization. Similarly, sound macroeconomic policies are an important prerequisite for ensuring that financial integration is beneficial. However, our analysis also suggests that the relationship between financial integration and economic policies is a complex one and that there are unavoidable inherent tensions in evaluating the risks and benefits associated with financial globalization. In the light of these tensions, structural and macroeconomic policies often need to be tailored to take into account country-specific circumstances to improve the risk-benefit tradeoffs of financial integration. Ultimately, it is essential to see financial integration not just as an isolated policy goal but also as part of a broader package of reforms and supportive macroeconomic policies. |
3A183163192X.jsonld | Chapter 21 Experimental Study of Law | This chapter surveys literature on experimental law and economics. Long the domain of legally minded psychologists and criminologists, experimental methods are gaining significant popularity among economists interested in exploring positive and normative aspects of law. Because this literature is relatively new among legally-minded economists, we spend some time in this survey on methodological points, with particular attention to the role of experiments within theoretical and empirical scholarship, the core ingredients of a well done experiment, and common distinctions between experimental economics and other fields that use experimental methods. We then consider a number of areas where experimental evidence is increasingly playing a role in testing the underlying foundational precepts of economic behavior as it applies to law, including bargaining in the shadow of the law, the selection of suits for litigation, and the investigation of jury and judge behavior. Our survey concludes by offering some suggestions about what directions experimental economists might push the methodology in the study of legal rules. |
3A1831635704.jsonld | Chapter 10 Arbitrage, state prices and portfolio theory | Neoclassical financial models provide the foundation for our understanding of finance. This chapter introduces the main ideas of neoclassical finance in a single-period context that avoids the technical difficulties of continuous-time models, but preserves the principal intuitions of the subject. The starting point of the analysis is the formulation of standard portfolio choice problems. A central conceptual result is the Fundamental Theorem of Asset Pricing, which asserts the equivalence of absence of arbitrage, the existence of a positive linear pricing rule, and the existence of an optimum for some agent who prefers more to less. A related conceptual result is the Pricing Rule Representation Theorem, which asserts that a positive linear pricing rule can be represented as using state prices, risk-neutral expectations, or a state-price density. Different equivalent representations are useful in different contexts. Many applied results can be derived from the first-order conditions of the portfolio choice problem. The first-order conditions say that marginal utility in each state is proportional to a consistent state-price density, where the constant of proportionality is determined by the budget constraint. If markets are complete, the implicit state-price density is uniquely determined by investment opportunities and must be the same as viewed by all agents, thus simplifying the choice problem. Solving first-order conditions for quantities gives us optimal portfolio choice, solving them for prices gives us asset pricing models, solving them for utilities gives us preferences, and solving them for probabilities gives us beliefs. We look at two popular asset pricing models, the CAPM and the APT, as well as complete-markets pricing. In the case of the CAPM, the first-order conditions link nicely to the traditional measures of portfolio performance. Further conceptual results include aggregation and mutual fund separation theory, both of which are useful for understanding equilibrium and asset pricing. |
3A1831649187.jsonld | Chapter Nineteen. Nonbinary Social Choice | Economists have used the term “nonbinary” to describe both choice functional nonbinariness (choice functions that cannot be rationalized as the maximizing outcome of a binary preference relation) and structural nonbinariness (the structure of the model dictates that pairs of alternatives do not belong to the domain of the social choice function). Here we have described necessary and sufficient conditions for oligarchy and dictatorship results in social choice models that are nonbinary in both senses. |
3A1831639599.jsonld | Chapter 5 Numerical solution of dynamic economic models | This chapter is concerned with numerical simulation of dynamic economic models. We focus on some basic algorithms and assess their accuracy and stability properties. This analysis is useful for an optimal implementation and testing of these procedures, as well as to evaluate their performance. Several examples are provided in order to illustrate the functioning and efficiency of these algorithms. |
3A1831644401.jsonld | Introduction to the series | This chapter provides an introduction to the Handbooks in Economics series. The aim of this series is to produce Handbooks for various branches of economics, each of which is a definitive source, reference, and teaching supplement for use by professional researchers and advanced graduate students. Each Handbook provides self-contained surveys of the current state of a branch of economics in the form of chapters prepared by leading specialists on various aspects of this branch of economics. These surveys summarize not only received results but also newer developments, from recent journal articles and discussion papers. Some original material is also included, but the main goal is to provide comprehensive and accessible surveys. The Handbooks are intended to provide not only useful reference volumes for professional collections but also possible supplementary readings for advanced courses for graduate students in economics. |
3A730011631.jsonld | National legislative and regulatory activities | Belgium – Amendment of the Act on classification and security clearances, certifications and security notifications Czech Republic – Resolution of the government of the Czech Republic on the time schedule of preparatory works for enlarging the nuclear power plant Temelín Finland – Temporary Amendment to the Nuclear Liability Act Ireland – Merchant Shipping Act Romania – Emergency Ordinance on the identification, designation and protection of critical infrastructures Emergency Ordinance on the control regime of dual-use items Amendment to the Act on the safe conduct of nuclear activities Nuclear safety norms on design and construction of nuclear power plants and nuclear safety norms on siting of nuclear power plants United Kingdom – Establishment of the Office for Nuclear Regulation United States – Waste Confidence Decision and Rule Update Response to recent events in Japan |
3A1831636484.jsonld | Chapter 6. The Theory of Pollution Policy | Physically, pollution occurs because it is virtually impossible to have a productive process that involves no waste; economically, pollution occurs because polluting is less expensive than operating cleanly. This chapter explores the sources and consequences of, and remedies for, pollution and associated environmental damages. If all goods had well-defined property rights and could be traded in markets, environmental goods would be no different than other goods; however, markets fail for these goods because property rights cannot or do not exist and because of the nonexclusive, nonrival nature of these goods. Thus, environmental goods provide the classic case where government intervention can increase efficiency. Achieving efficient levels of pollution involves charging per unit of pollution based on damages caused by that unit. In practice, this policy can be difficult to achieve, due to difficulties in measuring and differentiating damages by source, difficulties in monitoring and enforcing pollution policies, and the financial and political costs of pollution taxes. Additionally, pre-existing market distortions influence the nature of efficient pollution abatement strategies. Thus, many regulatory approaches that do not achieve first-best outcomes may be used because their technological or political feasibility is superior. Market-based instruments provide flexibility to polluters, while command-and-control (standards-based) approaches limit choice, often through an emissions limit or a technology requirement. Market-based approaches typically achieve a specified level of emissions with lower abatement costs than standards, but their greater efficiency may not hold in the presence of the problems mentioned above. Non-regulatory approaches to pollution control include the use of liability law to define and enforce property rights and some voluntary pollution control initiatives by polluters. While these approaches can play an important role, they are unlikely to achieve adequate provision of environmental goods. |
3A1831639173.jsonld | Chapter 6 Income poverty in advanced countries | This chapter reviews definitional issues that arise in assessing the extent of, and change in, poverty in western industrialized countries, including the choice of resource, level of poverty line and appropriate adjustments for the size and type of the income-sharing unit. The chapter also reviews the existing empirical evidence and presents estimates using the Luxembourg Income Study database. The first-order iimpact of the public sector suggests that countries with similar rates of market income poverty can have very different poverty rates once taxes and transfers have been received. Cross-national evidence on longitudinal aspects of poverty suggests that much remains to be learned about the patterns of intra- and intergenerational poverty mobility and their covariates. |
3A1831636190.jsonld | Chapter 22 National Income and the Environment | In this chapter, we review the concept of national income and the economic theory of national income accounting. There are two building blocks – the ideas of Fisher, Lindahl, Hicks about income as an expenditure level that can be continued into the future, and the concept of income as a welfare measure that emerges from the welfare economics and general equilibrium of the 1950s and 1960s. The former have led to an extensive literature on the use of Hamiltonians or their first-order approximations as an income measure. After reviewing this body of theory and the connections between the concepts, we suggest extensions and then consider how various proposed green accounting systems match up to the theoretical desiderata. We also review a number of empirical applications. We devote considerable space to the United Nations' proposed System of Economic and Environmental Accounts, and to accounting reforms proposed by the statistical offices of various countries. |
3A730011976.jsonld | Triangular co-operation and aid effectiveness | Can triangular co-operation make aid more effective? Judging by recent international declarations, governments think it can. The underlying assumption is that better results are achieved when Southern partners and “traditional” donors (i.e. those that gather in the OECD Development Assistance Committee) join forces through triangular co-operation. This article addresses what triangular co-operation is, which countries are involved in it and why; examines the claimed benefits of triangular co-operation vis-à-vis bilateral forms of co-operation; identifies some challenges in rendering triangular co-operation an effective mode of development co-operation; and provides recommendations on how these challenges can be met. |
3A1831649748.jsonld | Chapter 8. Radio | This chapter surveys the literature on the economics of radio, focusing on the broadcast industry in the United States. The first parts of the chapter provide a history of the radio industry and its regulation, and a guide to the data available for empirical research. The next part surveys the large empirical literature analyzing the effects of the wave of consolidation that took place after the Telecommunications Act of 1996, explaining which empirical results appear robust (for example, the effects of local consolidation on programming differentiation) and which remain unclear (for example, the effects of consolidation on advertising prices and quantities). The remaining parts survey the literature on whether there are too many radio stations; the strategies that stations use to boost the effectiveness of advertising; the effects of non-commercial stations on the commercial sector; and the interaction between the radio and music industries, including payola and copyright issues. The chapter emphasizes several topics that seem ripe for additional research. |
3A1831636018.jsonld | Chapter 2. Ecology and economics in the science of anthropogenic biosphere change | This chapter considers the ways in which research at the intersection of ecology and economics has strengthened our understanding of anthropogenic biosphere change. Three dimensions of the problem are addressed. The first is the linkages between the carrying and assimilative capacity of the environment and the substitutability of produced and natural capital. The second is connection between biodiversity, ecosystem functioning and the valuation of non-marketed environmental goods and services. The third is the resilience of ecological systems and the stability and sustainability of economic states and processes. Work across the two disciplines has affected the spatial and temporal scale at which the problem is addressed, the way in which biophysical processes appear in models of the coupled system, the data used to calibrate and validate those models, and the range of interventions considered. We show where traction has been gained by taking explicit account of processes that have traditionally been neglected or treated parametrically in economic models, or by taking account of stocks whose dynamics play out at different temporal and spatial scales. We also show how application of the ecological concept of resilience has provided both a foundation for sustainability science and a way to test the environmental consequences of demographic, technological, institutional and economic changes in human societies. |
3A1831649349.jsonld | Chapter 11. Privacy and the Internet | This chapter summarizes the fundamental questions underlying the economics of privacy. It highlights the tension between the multifaceted concept of privacy as commonly used in policy debates and its conceptualization as part of a utility function. The chapter then sets out new challenges for the economics of privacy in a variety of online settings with particular reference to the media industry. These settings include advertising, social networks, data security, and government surveillance. |
3A1831630702.jsonld | Chapter 6. Boards, and the Directors Who Sit on Them | Boards of directors are intellectually interesting; the literature on boards has academic impact and there is substantial scope for this literature to have policy impact. I illustrate these points by combining a select review of the literature with evidence from a variety of data sets. Boards are difficult to study—which makes them intellectually interesting. Papers on boards are cited 52.2% more per year since publication than other finance papers (controlling for year of publication and the number of papers published in the same year)—which makes them impactful. Boards are the focus of a substantial amount of policy-making—which means there is scope for the board literature to have policy impact. Although the literature on boards has grown substantially in recent years, I highlight that many topics for future research remain. Most importantly, I argue that to understand boards we need to understand the people who sit on them. |
3A1831633612.jsonld | Chapter 22 Reciprocity, altruism, and cooperative production | Economists believe that a problem of team production results from the desirability of production in (sometimes large) groups, the difficulty of rewarding individual group members based on their (difficult or impossible to measure) individual contributions, and the presumed interest of each individual in avoiding effort and earning more, without regard to the outcomes of others. Although a possible response is to expend resources on monitoring each worker and paying accordingly, there are indications that this may be a less cost-effective approach than is drawing upon workers' propensities to reciprocate the trust and liberality of an employer by providing more effort, and to engage in mutual monitoring, social sanctioning of free riders, and emulation of others' efforts, when faced with group-based incentives. The large literature on incentives in producer cooperatives that sprang up during the 1960s through the 1980s predates economists' recent work on reciprocity, but it did concern itself with the interdependence of choices and it included remarks about mutual monitoring. This chapter considers the roles that altruism and reciprocity might play in cooperatives, and it discusses the recent, largely experimental literature on reciprocity and other social preferences, considering its relevance to cooperatives and to incentives in teams more generally. |
3A1831642344.jsonld | Chapter 18 Inflation: Theory and evidence | This chapter presents a general overview of the subject of inflation, both in terms of relevant theory and evidence regarding competing hypotheses. During the years that have passed since the preparation of the ambitious survey article, the nature of research in monetary economics has changed considerably(1) rational expectations has become the mainstream hypothesis concerning expectation behavior, (2) the Ricardian equivalence theorem has become a familiar notion in policy discussions, (3) issues involving overlapping-generations models and cash-in-advance constraints have become common fare, (4) bubble and sunspot phenomena have been extensively investigated, and (5) problems associated with the dynamic inconsistency of policy have been pondered. The chapter describes the development of a simplified but dynamic general equilibrium framework for the analysis of steady-state inflation. |
3A1831630672.jsonld | Chapter 7. Executive Compensation: A Survey of Theory and Evidence | This paper reviews the theoretical and empirical literature on executive compensation. We start by presenting data on the level of CEO and other top executive pay over time and across firms, the changing composition of pay; and the strength of executive incentives. We compare pay in U.S. public firms to private and non-U.S. firms. We then critically analyze three non-exclusive explanations for what drives executive pay – shareholder value maximization by boards, rent extraction by executives, and institutional factors such as regulation, taxation, and accounting policy. We confront each hypothesis with the evidence. While shareholder value maximization is consistent with many practices that initially seem inefficient, no single explanation can account for all facts and historical trends; we highlight major gaps for future research. We discuss evidence on the effects of executive pay, highlighting recent identification strategies, and suggest policy implications grounded in theoretical and empirical research. Our survey has two main goals. First, we aim to tightly link the theoretical literature to the empirical evidence, and combine the insights contributed by all three views on the drivers of pay. Second, we aim to provide a user-friendly guide to executive compensation, presenting shareholder value theories using a simple unifying model, and discussing the challenges and methodological issues with empirical research. |
3A1831634244.jsonld | Chapter 20 Pre-School, Day Care, and After-School Care: Who's Minding the Kids? | The majority of children in the US and many other high-income nations are now cared for many hours per week by people who are neither their parents nor their school teachers. The role of such pre-school and out-of-school care is potentially two-fold: First, child care makes it feasible for both parents or the only parent in a single-parent family to be employed. Second, early intervention programs and after school programs aim to enhance child development, particularly among disadvantaged children. Corresponding to this distinction, there are two branches of literature to be summarized in this chapter. The first focuses on the market for child care and analyzes factors affecting the supply, demand and quality of care. The second focuses on child outcomes, and asks whether certain types of programs can ameliorate the effects of early disadvantage. The primary goal of this review is to bring the two literatures together in order to suggest ways that both may be enhanced. Accordingly, we provide an overview of the number of children being cared for in different sorts of arrangements; describe theory and evidence about the nature of the private child care market; and discuss theory and evidence about government intervention in the market for child care. Our summary suggests that additional research is needed in order to better characterize interactions between government programs and market-provided child care. |
3A1831654059.jsonld | Chapter 10. Monetary Policy and Unemployment | Much recent research has focused on the development and analysis of extensions of the New Keynesian framework that model labor market frictions and unemployment explicitly. This chapter describes some of the essential ingredients and properties of those models, and their implications for monetary policy. |
3A1831652307.jsonld | Subject Index | This chapter lists the terms that have contributed to the book, Handbooks in Economics , such as absenteeism, absorbing states, acculturation processes, and others. These terms have been mentioned along with the page numbers in which they appear in the bookfor the ease of the reader. |
3A1831642093.jsonld | Chapter 54 Variations on the shapley value | This survey captures the main contributions in the area described by the title that were published up to 1997. (Unfortunately, it does not capture all of them.) The variations that are the subject of this chapter are those axiomatically characterized solutions which are obtained by varying either the set of axioms that define the Shapley value, or the domain over which this value is defined, or both.In the first category, we deal mainly with probabilistic values. These are solutions that preserve one of the essential features of the Shapley value, namely, that they are given, for each player, by some averaging of the player's marginal contributions to coalitions, where the probabilistic weights depend on the coalitions only and not on the game. The Shapley value is the unique probabilistic value that is efficient and symmetric. We characterize and discuss two families of solutions: quasivalues, which are efficient probabilistic values, and semivalues, which are symmetric probabilistic values.In the second category, we deal with solutions that generalize the Shapley value by changing the domain over which the solution is defined. In such generalizations the solution is defined on pairs, consisting of a game and some structure on the set of players. The Shapley value is a special case of such a generalization in the sense that it coincides with the solution on the restricted domain in which the second argument is fixed to be the “trivial” one. Under this category we survey mostly solutions in which the structure is a partition of the set of the players, and a solution in which the structure is a graph, the vertices of which are the players. |
3A1831630613.jsonld | Chapter 1. Microeconometric models of consumer demand | A long literature has developed econometric methods for estimating individual-consumer-level demand systems that accommodate corner solutions. The increasing access to transaction-level customer purchase histories across a wide array of markets and industries vastly expands the prospect for improved customer insight, more targeted marketing policies, and individualized welfare analysis. A descriptive analysis of a broad, CPG database indicates that most consumer brand categories offer a wide variety of differentiated offerings for consumers. However, consumers typically purchase only a limited scope of the available variety, leading to a very high incidence of corner solutions which poses computational challenges for demand modeling. Historically, these computational challenges have limited the applicability of microeconometric models of demand in practice, except for the special case of pure discrete choice (e.g., logit and probit). Recent advances in computing power along with methods for numerical and simulation-based integration have been instrumental in facilitating the broader use of these models in practice. We survey herein the extant literature on the neoclassical derivation of microeconometric demand models that allow for corner solutions and differentiated products. We summarize the key developments in the literature, including the role of consumers' price expectations, and point towards opportunities for future research. |
3A1831634694.jsonld | Chapter 27. The Effect of Economic Growth on Social Structures | Changes in social structures occurring during the process of economic growth can be considered direct consequences of this process, while other changes are caused by factors such as technological progress, that affect simultaneously social structures and growth. This chapter focuses on that part of the circular argument that goes from growth to social structures. It does not consider the effect of social changes on growth. The chapter is thus an attempt to isolate the pure “income effect” in the evolution of social structures and to disentangle the effect of economic growth from the effect of other factors in observed changes in social structures. Section 1 examines the nature of the statistical relationships existing between social indicators and development across countries and/or across periods, in order to illustrate the differences in social structures associated with differences in income. It also discusses the difficulty of obtaining precise estimates of the size of the income effect from this kind of evidence and the need to rely on more structural analyses. Section 2 reviews theoretical models of the effect of economic growth on social structures, with an emphasis on several dimensions of social differentiation and on economic inequality. Section 3 focuses on the empirical evidence in support of this structural view of the consequences of growth for social structures. Section 4 concludes by emphasizing the importance of sectoral shifts, the role of the market in integrating the economy and society, and the social costs of sectoral adjustments. The effect of changes in social structures on social institutions and on social relations is only briefly discussed in the Conclusions. |
3A1831636611.jsonld | Chapter 47 Sorting and voting: A review of the literature on urban public finance | This chapter reviews the literature on the boundary between urban economics and local public finance, defined as research that considers both a housing market and the market for local public services. The first part of the chapter considers positive theories. This part presents the consensus model of the allocation of households to jurisdictions, which is built on bid functions and household sorting, as well as alternative approaches to this issue. It also examines models of local tax and spending decisions, which exhibit no consensus, and reviews research in which both housing and local fiscal variables are endogenous. The second part of the chapter considers empirical research, with a focus on tax and service capitalization, on household heterogeneity within jurisdictions, and on the impact of zoning. The third part considers normative theories about a decentralized system of local governments. This part examines the extent to which such a system leads to an efficient allocation of households to communities or efficient local public service levels, and it discusses the fairness of local public spending. This review shows that the bidding/sorting framework is strongly supported by the evidence and has wide applicability in countries with decentralized governmental systems. In contrast, models of local public service determination depend on institutional detail, and their connections with housing markets have been largely unexplored in empirical work. Ever since Tiebout (1956) , many scholars have argued that decentralized local governments have efficiency advantages over centralized forms. However, a general treatment of this issue identifies four key sources of inefficiency even in a decentralized system: misallocation of households to communities, the property tax, public service capitalization and heterogeneity. Few policies to eliminate these sources of inefficiency have yet been identified. Finally, this review explores the equity implications of household sorting and other features of a decentralized system. |
3A1831647982.jsonld | Chapter 9 Consumer theory | The main objective of consumer theory is to determine the impact on observable demands for commodities of alternative assumptions on the objectives, on the behavioral rules of the consumer, and on the constraints that they faces while making a decision. The chapter explains that the traditional model of the consumer takes preferences over alternative bundles to describe the objectives. Commodities can be divided into goods and services. Each commodity is completely specified by its physical characteristics, location, and date at which it is available. In studies of behavior under uncertainty, an additional specification of the characteristics of a commodity relating to the state of nature occurring is added, which leads to the description of a contingent commodity. The behavioral rule consists of maximization of these preferences under a budget restriction, which determines the trading possibilities. The principal results of the theory consist of the qualitative implications on observed demand of changes in the parameters, which determine the decision of the consumer. The historical development of consumer theory indicates a long tradition of interest of economists in the subject, which has undergone substantial conceptual changes over time to reach its present form. |
3A729992470.jsonld | Competition Advocacy : Challenges for Developing Countries | Competition advocacy is especially critical for developing countries as their economic policies are undergoing fundamental market driven changes. Prerequisites for effective competition advocacy by a competition agency include a significant degree of independence from political influence, sufficient resource to support both its enforcement and advocacy functions, and credibility as an effective and impartial advocate for competition. Opportunities for competition advocacy are numerous: privatization; legislation, government policy and regulatory reform. The Second Latin American Competition Forum, jointly sponsored by the OECD and the Interamerican Development Bank (Washington 14-15 June 2004) discussed the... |
3A1831640058.jsonld | Chapter 3. Macroeconomic Regimes and Regime Shifts | Many economic time series exhibit dramatic breaks associated with events such as economic recessions, financial panics, and currency crises. Such changes in regime may arise from tipping points or other nonlinear dynamics and are core to some of the most important questions in macroeconomics. This chapter surveys the literature for studying regime changes and summarizes available methods. Section 1 introduces some of the basic tools for analyzing such phenomena, using for illustration the move of an economy into and out of recession. Section 2 focuses on empirical methods, providing a detailed overview of econometric analysis of time series that are subject to changes in regime. Section 3 discusses theoretical treatment of macroeconomic models with changes in regime and reviews applications in a number of areas of macroeconomics. Some brief concluding recommendations for applied researchers are offered in Section 4 . |
3A1831638835.jsonld | Chapter 35 Equity in health | Equity in health has to be distinguished from equity in access to health care, or equity in the distribution of health care resources. We take as a working definition of health for our purposes the number of quality adjusted life years that a person may expect to enjoy over his or her lifetime. Although we mostly follow the economists' custom of regarding equity as synonymous with reducing inequalities in health, we also consider the much richer variety of concepts employed by philosophers when discussing distributive justice. Here however we have distinguished notions of justice which are essentially procedural from those which are substantive, concentrating mainly on the latter. What we have sought to do is to identify the implications of various philosophical theories of justice for the way in which a welfare economist might appraise a particular distribution of health within a community. To do this we distinguish theories which place constraints on admissible outcomes (the health opportunity set), from theories which require the social welfare function (or maximand) to have particular properties. This classification is summarised in the Table 1, which is the key exhibit around which the analysis and exposition is organised. |
3A1831650304.jsonld | Chapter 14. US Housing Policy | Governments throughout the world intervene heavily in housing markets, and most have multiple policies to pursue multiple goals. This chapter deals with two of the largest types of housing policies in the United States, namely, low-income rental assistance and policies to promote homeownership through interventions in mortgage markets. We describe the rationales for the policies, the nature of the largest programs involved, the empirical evidence on their effects, and the data and methods used to obtain them. Because the US government uses such a wide range of policies of these types, this evidence has lessons for housing policy in other countries. |
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