Open access harvesting of the Northeast Atlantic minke whale

The purpose of this paper is to analyze open access exploitation of the Northeast Atlantic minke whale. In particular the question whether open access could lead to stock extinction is addressed. A bioeconomic model of the open access fishery is developed and estimated for data from Norwegian whaling. Numerical analysis shows that open access was not likely to have lead to stock extinction for the minke whale.     

Variable unit costs in an output-regulated industry: The Fishery

Departing from general cost theory of the firm and bioeconomic theory of the fishery, this study contributes with an empirical examination of how variable unit costs in a Norwegian demersal and pelagic fishery depend on output and the fish stock. The identification of the separate effects that the two factors have on costs is not common in the literature. Three Norwegian fleets fishing Norwegian spring spawning herring (Clupea Harengus) and five Norwegian fleets fishing Northeast Arctic cod (Gadus Morhua) are evaluated. The findings indicate that variable unit costs fall in output in both fisheries. The results also show that variable unit costs fall in fish stock in the demersal fishery, but with a stock elasticity of variable unit costs in absolute terms significantly less than 1. These results are of relevance to a manager seeking the optimal harvest rule and to understand fishermen's incentives when individual vessel quotas are reduced.     

Estimates of the Economic Effects of Sea Level Rise

Regional estimates of direct cost (DC) are commonly used to measure the economic damages of sea level rise. Such estimates suffer from three limitations:(i) values of threatened endowments are not well known, (ii) loss of endowments does not affect consumer prices, and (iii) international trade is disregarded. Results in this paper indicate that these limitations can significantly affect economic assessments of sea level rise. Current uncertainty regarding endowment values (as reflected in two alternative data sets), for example, leads to a 17 percent difference in coastal protection, a 36 percent difference in the amount of land protected, and a 36 percent difference in DC globally. Also, global losses in equivalent variation (EV), a welfare measure that accounts for price changes, are 13 percent higher than DC estimates. Regional EV losses may be up to 10 percent lower than regional DC, however, because international trade tends to redistribute losses from regions with relatively high damages to regions with relatively low damages.     

中国资本市场大幅波动的经济心理分析

中国资本市场在经历了2005年以来的大涨行情后,从2007年年末到2008年中期近一年的时间中,股指不断下滑,各类股票价格屡创新低,市值损失在70%左右。除了经济基本面以及美国金融危机的影响外,投资者的经济心理因素也是一个很重要的方面,这值得我们深入探讨和研究。     

Does the CPI Mirror the Cost of Living? Engel's Law Suggests Not in Norway

There is considerable interest in identifying the magnitude of the difference between increases in the CPI and the cost of living. In this paper, the technique proposed by Hamilton (2001) to measure this discrepancy is used and extended for Norway in the 1990s. While Hamilton finds that the CPI in the United States overstates the cost of living for the period 1974–1991, application of his technique to Norwegian data for 1990–1999 indicates that the CPI understates the cost of living. The Norwegian CPI rose by 22 percent, but a typical household behaved as if the cost of living had increased by 35 percent. For some household types, the increase was substantially larger.     

The relation between the informational content of implied volatility and arbitrage costs: Evidence from the Oslo Stock Exchange

This study investigates the proposition that volatility of stock returns can be predicted from the volatility implied by options on the Oslo Stock Exchange (OSE), conditional on the ability to perform arbitrage. Insights into the relation between the informational content of implied volatility and arbitrage cost can be distilled from Oslo Stock Exchange data. For Norwegian firms, options and their underlying stock trade on the Oslo Stock Exchange and have an overlapping set of market makers thereby lowering the cost of arbitrage. Other components of arbitrage trading costs, liquidity and dispersion of stock return volatility, vary widely across Norwegian firms. Moreover, restriction on the short selling of stock in Oslo allows further insight into the role of arbitrage costs in determining the informational content of implied volatility. The results yield support for the arbitrage cost hypothesis: the lower the arbitrage cost between the stock and the option, the greater the informational content of implied volatility.     

The role of economics in global management of whales: re-forming or re-founding IWC?

The global management of whale species, identified as an economic mixed good, is addressed by means of economic theory of bargaining and institution making. I will analyse (i) why it is important to take into account explicitly both (consumptive) use and non-use values within international conventions on global mixed goods; (ii) the role and nature of institutions dealing with global issues; (iii) the role of bargaining between conflicting interests as a focal feature of the institution-making process; and, (iv) the role of economic thinking in international conventions. Co-operative and non co-operative solutions are discussed, and instruments aimed at achieving co-operative bargaining, analysed. The study has both positive and normative implications, with insights on social welfare enhancing institutional reforms. Although the study is broad yet special focus is given to the International Whaling Commission (IWC). This paper concludes that we should make economic theory operational within the realm of global institutions. On the basis of the bargaining model, the conclusion is that IWC should necessarily be re-founded or at least re-formed, changing the convention from ‘whaling’ to a ‘whale’. It is suggested that the possibility of introducing compensatory side payments into the bargaining arena in order to increase social welfare and enforceability with respect to a ‘ban’ scenario be investigated. Ethical implications of monetary compensations are considered in parallel with economic efficiency. The limits and potentialities of economics and economic instruments are also tested globally with respect to the whale and other environmental issues.     

Predator–prey dynamics in general equilibrium and the role of trade

We examine the implications of trade in an economy with two interrelated natural resources, focusing on the case of a simple predator–prey relationship. We derive a three-sector general equilibrium model where production functions are linked via the ecological dynamics of the natural system. Under autarky, this economy exhibits a steady-state equilibrium that overexploits the prey stock, reducing the linked predator population and overall welfare in the absence of harvesting controls. When two economies engage in trade, differences in the dynamics of the two resource systems can become the basis for comparative advantage. In this case, the predator–prey relationship leads to a source of comparative advantage in harvesting prey for a country with a lower autarky steady-state proportion of predators to prey. This feature has not been noticed in the literature and leads to a counterintuitive implication: free trade can help conserve predator and prey stocks in the country with the higher autarkic steady-state proportion of predators to prey. To illustrate the relevance of our analytic findings, we present the stylized empirical example of the effect of Chinook salmon imports on killer whale populations.     

Managing excessive predation in a predator-endangered prey setting

Bioeconomic analyses of predator–prey systems examine how to adjust species management in response to predation spillovers to avoid inefficiencies. Predation spillovers refer to the net economic value of predation, taking into account the impacts on prey. Inefficiencies arise when the species interactions that generate this value are not managed to maximize the net economic surplus generated by the system. Consumptive values for predator and/or prey harvests factor into the value of predation spillovers in prior work. In contrast, we examine the optimal management of a predator–prey system where the only values are non-market values associated with the species' abundances. We find that adverse predation spillovers may alone create social incentives for harvests or other interventions. Moreover, optimally reducing adverse predation spillovers may increase both species' abundances — an ecological “win–win” outcome that increases economic surplus, although the result depends on the controls used. We examine predator removal and predator exclosures that shelter prey from predation. Using a numerical example of the Great Lakes Piping Plover, an endangered prey bird, and Merlins, a falcon predator, we find predator exclosures can reduce inefficiencies and produce a win–win outcome.     

Trade policy and ecology

Trade sanctions on product exports are often used as measures for conservation of stocks of living resources. Two opposing approaches are investigated. The harvest approach argues that sanctions reduce the harvest, and thus protects the stock. It is shown that this does not consider the long run effects nor the effects of sanctions on the management system. The investment approach argues that increased price protects the stock, making the species a profitable investment. It is shown that this approach does not consider the asset effects of price changes, and that the sanctions usually increase the stock in an one species analysis. If the wildlife competes for land the conclusions may be different, but still sanctions usually works. If the manager has a joint management of several species, the stock effects of sanctions are ambiguous, depending on both the species interaction, and the profitability of the harvesting from each of them. In this case it is not possible to use intuitive reasoning, sanctions give distortions to all stocks simultaneously. The threat of extinction depends crucially on the unit cost in harvesting of depleted stocks. The paper concludes that trade policy is a too general measure for the management of living resources, and may implicate important economic distortions to the ecological system.This study is partially funded by the Research Council of Norway (Environment and Development). I thank Derek Clark, Tore Thonstad, Frode Steen and two anonymous referees for helpful comments.     

Expert panel on practice patterns in the management of cow’s milk protein allergy and associated economic burden of disease on health service in Turkey

Aims: To evaluate practice patterns in the management of cow’s milk protein allergy (CMPA) and associated economic burden of disease on health service in Turkey.

Materials and methods: This study was based on experts’ views on the practice patterns in management of CMPA manifesting with either proctocolitis or eczema symptoms and, thereby, aimed to estimate economic burden of CMPA. Practice patterns were determined via patient flow charts developed by experts using the modified Delphi method for CMPA presented with proctocolitis and eczema. Per patient total 2-year direct medical costs were calculated, including cost items of physician visits, laboratory tests, and treatment.

Results: According to the consensus opinion of experts, 2-year total direct medical cost from a payer perspective and societal perspective was calculated to be $US2,116.05 and $US2,435.84, respectively, in an infant with CMPA presenting with proctocolitis symptoms, and $US4,001.65 and $US4,828.90, respectively, in an infant with CMPA presenting with eczema symptoms. Clinical nutrition was the primary cost driver that accounted for 89–92% of 2-year total direct medical costs, while the highest total direct medical cost estimated from a payer perspective and societal perspective was noted for the management of an exclusively formula-fed infant presenting either with proctocolitis ($US3,743.85 and $US4,025.63, respectively) or eczema ($US6,854.10 and $US7,917.30, respectively). The first line use of amino acid based formula (AAF) was associated with total direct cost increment $US1,848.08 and $US3,444.52 in the case of proctocolitis and eczema, respectively.

Limitations: Certain limitations to this study should be considered. First, being focused only on direct costs, the lack of data on indirect costs or intangible costs of illness seems to be a major limitation of the present study, which likely results in a downward bias in the estimates of the economic cost of CMPA. Second, given the limited number of studies concerning epidemiology and practice patterns in CMPA in Turkey, use of expert clinical opinion of the panel members rather than real-life data on practice patterns that were used to identify direct medical costs might raise a concern with the validity and reliability of the data. Also, while this was a three-step study with six experts included in the first stage (developing local guidelines for diagnosis, treatment, and follow-up of infants with CMPA in Turkey) and 410 pediatricians included in the second stage (a cross-sectional questionnaire-survey to determine pediatricians’ awareness and practice of CMPA in infants and children), only four members were included in the present Delphi panel, which allows a limited discussion. Third, lack of sensitivity analyses and exclusion of indirect costs and costs related to alterations in quality of life, behavior of infants, and general well-being of infants and their parents from the cost-analysis seems to be another limitation that may have caused under-estimation of relative cost-effectiveness of the formulae. Fourth, calculation of costs per local guidelines rather than real-life practice patterns is another limitation that, otherwise, would extend the knowledge achieved in the current study. Notwithstanding these limitations, the present expert panel provided practice patterns in the management of CMPA and an estimate of the associated costs, depending on the symptom profile at initial admission for the first time in Turkey.

Conclusions: In conclusion, in providing the first health economic data on CMPA in Turkey, the findings revealed that CMPA imposes a substantial burden on the Turkish healthcare system from both a payer perspective and societal perspective, and indicated clinical nutrition as a primary cost driver. Management of infants presenting with eczema, exclusively formula-fed infants, and first line use of AAF were associated with higher estimates for 2-year direct medical costs.     

A cost-benefit analysis of moose harvesting in Scandinavia. A stage structured modelling approach

A cost-benefit analysis of moose (Alces alces) harvesting in Scandinavia is presented within the framework of an age structured model with four categories of animals (calves, yearlings, adult females, and adult males). The paper aims to demonstrate the economic content of such a wildlife model and how this content may change under shifting economic and ecological conditions. Two different harvesting regimes are explored: landowner profit maximization, where the combined benefit of harvesting value and browsing damage is taken into account, and overall management, where the costs and damages of moose-vehicle collisions are taken into account as well. An empirical analysis of the Norwegian moose stock indicates that the present stock level is far too high compared with the overall management scenario, and that the composition of the harvest could be improved.     

The effects of the Uruguay round: empirical evidence from U.S. industry

This article uses an event study to evaluate the anticipated results of the Uruguay Round on U.S. industry. Economists commonly use computable general equilibrium (CGE) models to predict the net economic efficiency effects of trade agreements. The event study method represents a complementary approach that relies on stock price movements to assess how investors predict that an event, in this case the conclusion of the Uruguay Round, will affect industry profitability. The empirical estimates indicate that U.S. industries with comparative advantage (disadvantage) experience positive (negative) stock price reactions, reflecting an increase (a decrease) in the industry trade and investment opportunities as well as an increased (decreased) return to existing tangible and intangible assets. For the market as a whole, the variation in stock prices does not differ significantly from zero, and the economic magnitude of industry gains and losses is small. These results are consistent with most CGE assessments and with the skeptical attitude that the real impact of the Uruguay Round Agreement remains uncertain.     

The Economic Cost of Gender Gaps in Effective Labor: Africa's Missing Growth Reserve

This study analyzes the impact of the gender gap in effective labor – defined as the combined effect of the gender gaps in labor force participation and education – on economic output per worker. The results indicate that the gender gap in effective labor has a negative effect on the economic output per worker in African countries. A 1 percent increase in the gender gap in effective labor leads to a reduction in output per worker by 0.43–0.49 percent in Africa overall, 0.29–0.50 percent in Sub-Saharan Africa, and 0.26–0.32 percent in a wider group of countries from Africa and Asia. The total annual economic losses due to gender gaps in effective labor could be as high as US$255 billion for the African region. Results confirm that Africa is missing its full growth potential because a sizeable portion of its growth reserve – women – is not fully utilized.     

Health and Economic Impact of Air Pollution in Jakarta

Jakarta is one of the most polluted cities in the world. Air pollution in Jakarta is above the safe limits specified by the World Health Organization. It is estimated that the health cost of Jakarta's air pollution in 1999 reached $US220 million. In 2001 the government planned to launch a program to control vehicle emissions. This paper aims to estimate economic impact of this program. To achieve this goal, the paper estimates the economic costs of air pollution in Jakarta for the year 2015 with and without the program.     

Entry costs and stock market participation over the life cycle

Several explanations for the observed limited stock market participation have been offered in the literature. One of the most promising is the presence of market frictions mostly in the form of fixed entry and/or transaction costs. Empirical studies point to a significant structural (state) dependence in the stock market entry decision, which is consistent with costs of this type. However, the magnitude of these costs is not yet known. This paper focuses on fixed stock market entry costs. I set up a structural estimation procedure which involves solving and simulating a life cycle intertemporal portfolio choice model augmented with a fixed stock market entry cost. Important features of household portfolio data (from the PSID) are matched to their simulated counterparts. Utilizing a Simulated Minimum Distance estimator, I estimate the coefficient of relative risk aversion, the discount factor and the stock market entry cost. Given the equity premium and the calibrated income process, I estimate a one-time entry cost of approximately two percent of the permanent component of the annual labor income. My estimated model matches the zero median holding as well as the hump-shaped age–participation profile observed in the data.     

THE RELATIONSHIP BETWEEN FINANCIAL INCENTIVES FOR COMPANY PRESIDENTS AND FIRM PERFORMANCE IN JAPAN*

Kaplan (1994 ) concludes that the relationship between top pay and stock performance in Japan is similar to that in the USA. Using a new and comprehensive data set that includes presidents’ stock and their stock option holdings, this study estimates the sensitivity of Japanese presidents’ wealth to shareholder wealth in the period 1977–2000. Contrary to the commonly held belief that Japanese corporate governance is becoming more like that in the USA, the results show that pay–performance sensitivity actually decreased substantially after 1990. In 2000, Japanese presidents received $US22,100 when stock returns increased from ?2.1% to 14.8%.     

OIL PRICE SHOCKS AND STOCK MARKET BOOMS IN AN OIL EXPORTING COUNTRY

This paper analyses the effects of oil price shocks on stock returns in Norway, an oil-exporting country, highlighting the transmission channels of oil prices for macroeconomic behaviour. To capture the interaction between the different variables, stock returns are incorporated into a structural VAR model. I find that following a 10% increase in oil prices, stock returns increase by 2.5%, after which the effect gradually dies out. The results are robust to different (linear and non-linear) transformations of oil prices. The effects on the other variables are more modest. However, all variables indicate that the Norwegian economy responds to higher oil prices by increasing aggregate wealth and demand. The results also emphasize the role of other shocks; monetary policy shocks in particular, as important driving forces behind stock price variability in the short term.     

A METHOD FOR IMPROVED CAPITAL MEASUREMENT BY COMBINING ACCOUNTS AND FIRM INVESTMENT DATA

We propose a new method for estimating capital stocks at the firm level by combining business accounts information and investment data. The method also produces capital estimates at the sector or industry level by summing individual firms' capital stocks and appropriately inflating this sum to account for firms not included in the data set. Our approach has two major advantages compared with the much used Perpetual Inventory Method (PIM). First, long investment series are not necessary. Second, sector capital estimates are automatically adjusted for changes in the capital stock because of entry and exit of firms. While capital growth rates in Norwegian manufacturing were only 1 percent on average during 1993–2004 according to national accounts figures, our method yields much higher growth rates of 5.5 percent on average.     

中国国有企业代理成本的实证分析

我们运用“2 0 0 2年国有企业改制调查”中的激励工资数据 ,按Broyden Fletcher Goldfarb Shanno的最大似然估计模拟程序 ,对中国国有企业代理成本的规模、原因做了估计与分析。结果发现 ,中国国有企业的代理成本 ,相当于 60 %— 70 %的利润潜力。也就是说 ,在现存的国有企业体制下 ,代理成本使企业效率只达到了 3 0 %— 40 % !委托人 (政府的国资管理机构 )对客观随机冲击θ、代理人风险规避参数r及努力的边际成本递增率 η缺乏充分信息所产生的代理成本占总代理成本的 2 3 ;而由代理人风险规避所导致的代理成本占 1 3。模拟估算的结果显示 ,采取租赁、出售或租售国企的方式 ,大约可以使利润潜力的利用率增加 2 0个百分点 ;若要降低契约的信息成本 ,则应该在财产所有权与控制权上努力实现分权化。