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Economics Literature (economics + literature)
Selected AbstractsWILLINGNESS-TO-PAY FOR CRIME CONTROL PROGRAMS,CRIMINOLOGY, Issue 1 2004MARK A. COHEN This paper reports on a new methodology to estimate the "cost of crime." It is adapted from the contingent valuation method used in the environmental economics literature and is itself used to estimate the public's willingness to pay for crime control programs. In a nationally representative sample of 1,300 U.S. residents, we found that the typical household would be willing to pay between $100 and $150 per year for programs that reduced specific crimes by 10 percent in their communities. This willingness amounts, collectively, to approximately $25,000 per burglary, $70,000 per serious assault, $232,000 per armed [source] Use of instrumental variables in the presence of heterogeneity and self-selection: an application to treatments of breast cancer patientsHEALTH ECONOMICS, Issue 11 2007Anirban Basu Abstract Instrumental variable (IV) methods are widely used in the health economics literature to adjust for hidden selection biases in observational studies when estimating treatment effects. Less attention has been paid in the applied literature to the proper use of IVs if treatment effects are heterogeneous across subjects and individuals select treatments based on expected idiosyncratic gains or losses from treatments. In this paper we compare conventional IV analysis with alternative approaches that use IVs to estimate treatment effects in models with response heterogeneity and self-selection. Instead of interpreting IV estimates as the effect of treatment at an unknown margin of patients, we identify the marginal patients and we apply the method of local IVs to estimate the average treatment effect and the effect on the treated on 5-year direct costs of breast-conserving surgery and radiation therapy compared with mastectomy in breast cancer patients. We use a sample from the Outcomes and Preferences in Older Women, Nationwide Survey which is designed to be representative of all female Medicare beneficiaries (aged 67 or older) with newly diagnosed breast cancer between 1992 and 1994. Our results reveal some of the advantages and limitations of conventional and alternative IV methods in estimating mean treatment effect parameters. Copyright © 2007 John Wiley & Sons, Ltd. [source] A preliminary investigation of the effects of restrictions on Medicaid funding for abortions on female STD ratesHEALTH ECONOMICS, Issue 6 2003Bisakha Sen Abstract There is evidence in the economics literature that restrictions on Medicaid funding for abortion reduces the demand for abortion. The unresolved question is whether such restrictions also increase safe sex (that is, pregnancy avoidance) behavior among women. This study explores that issue using state-level gonorrhea rates among women for 1975,1995. The rationale is that sexual behavior that leads to greater risk of accidental pregnancies is likely to be highly correlated with sexual behavior leading to greater risk of STD infection. Since gonorrhea has an incubation period of about a week, and is transmitted almost exclusively through sexual intercourse, a change in sexual behavior should soon be followed by a change in gonorrhea rates. The study used a partial adjustment model with lagged-dependent variables estimated using Arellano-Bond's GMM method. Results fail to find any statistically significant evidence that Medicaid funding restrictions are effective in reducing gonorrhea rates. This finding is robust to a variety of alternate specifications and tests. This suggests that restrictions on Medicaid funding for abortion fail to promote safe sex behavior among women. Copyright © 2002 John Wiley & Sons, Ltd. [source] The labour market for nursing: a review of the labour supply literatureHEALTH ECONOMICS, Issue 6 2003Emanuela Antonazzo Abstract The need to ensure adequate numbers of motivated health professionals is at the forefront of the modernisation of the UK NHS. The aim of this paper is to assess current understanding of the labour supply behaviour of nurses, and to propose an agenda for further research. In particular, the paper reviews American and British economics literature that focuses on empirical econometric studies based on the classical static labour supply model. American research could be classified into first generation, second generation and recent empirical evidence. Advances in methods mirror those in the general labour economics literature, and include the use of limited dependent variable models and the treatment of sample selection issues. However, there is considerable variation in results, which depends on the methods used, particularly on the effect of wages. Only one study was found that used UK data, although other studies examined the determinants of turnover, quit rates and job satisfaction. The agenda for further empirical research includes the analysis of discontinuities in the labour supply function, the relative importance of pecuniary and non-pecuniary job characteristics, and the application of dynamic and family labour supply models to nursing research. Such research is crucial to the development of evidence-based policies. Copyright © 2002 John Wiley & Sons, Ltd. [source] Estimating the monetary value of health care: lessons from environmental economicsHEALTH ECONOMICS, Issue 1 2003Nick Hanley In the recent past, considerable effort in health economics has been made on applying stated preference methods such as contingent valuation and choice experiments. Despite this increased use, there is still considerable scepticism concerning the value of these approaches. The application of contingent valuation in environmental economics has a long history and has been widely accepted. Whilst choice experiments were introduced to the environmental and health economics literature at a similar time, the wider acceptance of monetary measures of benefit in environmental economics has meant that they have also been more widely applied. The purpose of this paper is to identify some of the key issues and debates that have taken place in the environmental economics literature, summarise the state of the art with respect to these issues, and consider how health economists have addressed these issues. Important areas for future research in health economics are identified. Copyright © 2002 John Wiley & Sons, Ltd. [source] Tourism demand modelling: some issues regarding unit roots, co-integration and diagnostic testsINTERNATIONAL JOURNAL OF TOURISM RESEARCH, Issue 5 2003Paresh Kumar Narayan Abstract This paper investigates the all important issue of diagnostic tests, including unit roots and cointegration, in the tourism demand modelling literature. The origins of this study lie in the apparent lack in the tourism economics literature of detail concerning the diagnostic test aspect. Study of this deficiency has suggested that previous literature on tourism demand modelling may be divided into two categories: the pre-1995 and post-1995 studies. It was found that the pre-1995 and some post-1995 studies have ignored unit root tests and co-integration and, hence, are vulnerable to the so-called ,spurious regression' problem. In highlighting the key diagnostic tests reported by post-1995 studies, this paper contends that there is no need to report the autoregressive conditional heteroskedasticity (ARCH) test, which is applicable only to financial market analysis where the dependent variable is return on an asset. More generally, heteroskedasticity is not seen as a problem in time-series data. However, the reporting of a greater than necessary range of diagnostic tests,,,some of which do not have any theoretical justification with regard to tourism demand analysis,,,does not diminish the precision of the results or the model. This paper should appeal to scholars involved in tourism demand modelling. Copyright © 2003 John Wiley & Sons, Ltd. [source] COMBINING REVEALED AND STATED PREFERENCE DATA TO ESTIMATE THE NONMARKET VALUE OF ECOLOGICAL SERVICES: AN ASSESSMENT OF THE STATE OF THE SCIENCEJOURNAL OF ECONOMIC SURVEYS, Issue 5 2008John C. Whitehead Abstract This paper reviews the marketing, transportation and environmental economics literature on the joint estimation of revealed preference (RP) and stated preference (SP) data. The RP and SP approaches are first described with a focus on the strengths and weaknesses of each. Recognizing these strengths and weaknesses, the potential gains from combining data are described. A classification system for combined data that emphasizes the type of data combination and the econometric models used is proposed. A methodological review of the literature is pursued based on this classification system. Examples from the environmental economics literature are highlighted. A discussion of the advantages and disadvantages of each type of jointly estimated model is then presented. Suggestions for future research, in particular opportunities for application of these models to environmental quality valuation, are presented. [source] The Law and Economics of Marriage ContractsJOURNAL OF ECONOMIC SURVEYS, Issue 2 2003Ian Smith Growth in property ownership has raised the stakes in the distribution of financial assets on divorce. Given high risks of marital failure, this has stimulated the demand for private ordering through enforceable marriage contracts. This paper surveys the existing law and economics literature and legal practice to consider the state of knowledge on the economic theory, scope and limits of written nuptial agreements. [source] Lancaster's characteristics approach revisited: product selection using non-parametric methodsMANAGERIAL AND DECISION ECONOMICS, Issue 2 2002Angel S. Fernandez-Castro In consumer theory, the principles of Lancaster's characteristics approach and hedonic pricing appear to offer the most promising insight into choice when qualitative aspects are important. The paper reconciles these principles with the family of non-parametric frontier estimation methods known as data envelopment analysis. It is shown that, with some straightforward adjustments, DEA is entirely consistent with the characteristics view of consumer choice found in the economics literature. In making Lancaster's ideas operational, the paper also addresses the theoretical concern voiced by Lancaster about combining indivisible products. The principles are illustrated with a case study involving the comparison of diesel cars. The paper concludes that the user will ultimately have to apply some judgement in choosing between competing efficient products. However, the analysis should help to restrict the number of products to be assessed to manageable proportions. Copyright © 2002 John Wiley & Sons, Ltd. [source] Using Economic Theory and Research to Better Understand Volunteer BehaviorNONPROFIT MANAGEMENT & LEADERSHIP, Issue 1 2002Paul L. Govekar The literature on the determinants of volunteering for nonprofit organizations is highly complex, and noconceptual model has received general support (Winniford, Carpenter, and Grider, 1997). Researchers often cite the huge economic impact that nonprofit organizations have on the economy as a whole. However, they seldom mention the small but potentially important body of research on the determinants of the supply of volunteer labor that appears in the economics literature. ,The purpose of this article is to outline some of the economic arguments used to explain the determinants of volunteering and point out some cases where they may support other theories and concepts concerning the determinants of volunteering. [source] With Friends Like These: Endogenous Labor Market Segregation with Homogeneous, Nonprejudiced AgentsAMERICAN JOURNAL OF ECONOMICS AND SOCIOLOGY, Issue 3 2009Article first published online: 3 JUN 200, Tavis Barr In the economics literature, labor market segregation is typically assumed to arise either from prejudice (Becker 1971) or from group differences in human capital accumulation (Benabou 1993; Durlauf 2006; Fryer 2006). Many sociological studies, by contrast, consider social network structure as an embodiment of various forms of social capital, including the creation of obligations, information channels, and enforceable trust (Coleman 1988; Portes and Sensenbrenner 1993). When firms hire by referral, social network segregation can lead to labor market segregation (Tilly 1998). Various social network structures may arise from the actions of self-interested individuals (Watts and Strogatz 1998; Jackson 2006); by incorporating concepts of social capital into an economic framework of profit-maximizing firms, this article develops a model of labor markets in which segregation arises endogenously even though agents are homogeneous and have no dislike for each other. Firms hire through referrals, and can enforce discipline by bribing a referrer to prevent a hiree from getting any outside job offers from other friends if he or she shirks. This is possible only if social networks are reasonably closed, so that the referee knows a majority of his or her friends' friends. By segregating into small communities, workers can more effectively create closed social networks. Social networks with different reservation wages will receive different wages; firms can induce such segregation and wage discrimination in the interest of profit. Workers may not benefit from such segregation, except as a best response to being in a society where it already exists; the "friends" in these social networks act as a worker discipline device, and in this way treat each other inimically. [source] Weak Identification of Forward-looking Models in Monetary Economics,OXFORD BULLETIN OF ECONOMICS & STATISTICS, Issue 2004Sophocles Mavroeidis Abstract Recently, single-equation estimation by the generalized method of moments (GMM) has become popular in the monetary economics literature, for estimating forward-looking models with rational expectations. We discuss a method for analysing the empirical identification of such models that exploits their dynamic structure and the assumption of rational expectations. This allows us to judge the reliability of the resulting GMM estimation and inference and reveals the potential sources of weak identification. With reference to the New Keynesian Phillips curve of Galí and Gertler [Journal of Monetary Economics (1999) Vol. 44, 195] and the forward-looking Taylor rules of Clarida, Galí and Gertler [Quarterly Journal of Economics (2000) Vol. 115, 147], we demonstrate that the usual ,weak instruments' problem can arise naturally, when the predictable variation in inflation is small relative to unpredictable future shocks (news). Hence, we conclude that those models are less reliably estimated over periods when inflation has been under effective policy control. [source] The Estimation of a Cusp Model to Describe the Adoption of Word for Windows,THE JOURNAL OF PRODUCT INNOVATION MANAGEMENT, Issue 1 2004Rense Lange This article revisits earlier work in this journal by Paul Herbig (1991) that proposed a catastrophe model of industrial product adoption under certain conditions. Catastrophe models are useful for modeling situations where organizations can exhibit both smooth and abrupt adoption behavior. It extends Herbig's work by focusing on organizations' adoption of new products when network externalities are an important part of the decision process, and it presents an empirical estimation of the model. Network externalities occur when firms do not want to adopt a new innovation or product unless other firms do. The reason is that they do not want to end up with an innovation that ends up not being a standard of some sort. Mistakes of this nature can be costly as the firm must invest twice and loses time relative to competitors who have not made such a mistake. However, when such externalities exist, for example with regard to technological adoptions, then normal diffusion gives way to sudden discontinuous shifts as all firms seemingly act together an move to a new technology. Since, technology is an area where the authors expect network externalities to exist, that is the focus of this article. The specific application is developed from two sets of panel data on the organizational adoptions of Microsoft's (MS) Word for Windows software by organizations that previously were using either Word for DOS or Word for Macintosh (Mac). The theoretical framework for the analysis is based on work in the economics literature on network externalities. However, the organization and new product development catastrophe model comes primarily from Herbig (1991). The article focuses on an area of organizational adoption where relatively little empirical research has been done, namely organizational adoption "for use." Longitudinal data provided by Techtel Corporation is used to develop the estimations. Results of the empirical analysis are consistent with the theoretical framework suggested in Herbig's article and in those found in economics and catastrophe theory literatures. This lends clear support to the idea that organizations will adopt a bandwagon-type behavior when network externalities are present. It further suggests that in such markets, the standard S-shaped diffusion curve is not an appropriate model for examining organizational behavior. From a managerial perspective, it means that buyers and sellers may face nonstandard diffusion curves. Instead of S-shaped curves, the actual curves have a break or rift where sales end, and there is a sudden shift to a new product that is relatively high very early on. Clearly, for new product development (NPD), it suggest that organizations' "for-use" purchases may be similar to regular consumers and may change rapidly from one product to another almost instantly, as in the case of the switch from vinyl records to compact discs (CDs). From an old product seller's viewpoint, the market is here today and gone tomorrow, while for the new seller it is a sudden deluge of sales requests. To put it in more everyday terms, sudden changes in adoption behavior are a September 11-type experience for the market. It is the day the world changes. [source] AUSTRALIA'S EQUITY HOME BIASAUSTRALIAN ECONOMIC PAPERS, Issue 1 2008ANIL V. MISHRA This paper constructs the float adjusted measure of home bias and explores the determinants of Australia's equity home bias by employing the International Monetary Fund's high quality dataset (2001 to 2005) on cross border equity investment. On the empirical front, the paper conducts robustness tests by employing instrumental variables that are standard in the financial economics literature. The paper finds that the share of the number of firms listed in the domestic market and the share of internet users in the total population of the host country has a significant impact on equity home bias. Trade linkages are found to have a mixed impact on equity home bias. The paper also finds that the country's market share of the world market capitalisation and transaction costs do not impact Australia's equity home bias. Investors are found to exhibit low diversification motives. [source] |