Foreign aid and fiscal behavior in a bounded rationality model: Different policy regimes

We examine how the source of foreign aid affects the composition of the recipient government's spending. Does the source of aid – bilateral or multilateral – influence recipient policy-makers' choice between development and nondevelopment expenditure? We depart from previous literature by introducing strong asymmetries in policy-makers' preferences. With the financial constraints set by foreign aid and domestic revenues, this formalization allows us to model and estimate the fiscal behavior of government policy-makers in the presence of foreign aid.     

On Hayek's road to serfdom: 60 years later

Stimulated by recent work of Levy–Peart–Ferrant, Rosser and McPhail, I read The Road to Serfdom by projecting it onto four registers—security and freedom, impersonal forces and the market, rules and the rule of law, and language and education—and identify in each the need for judgement, hopefully balanced but inevitably arbitrary beyond an analytical threshold, a need exacerbated by incomplete and dispersed knowledge. My larger project is to understand the role of the expert, theoretician if one prefers, in a ‘free’ society.     

A cointegration analysis of purchasing power parity: 1973–96

This paper tests the purchasing power parity (PPP) hypothesis for five industrial countries using cointegration and error-correction modeling. The cointegration test indicated that for all countries the PPP hypothesis holds in the long run but not in the short run. Further, the errorcorrection models suggested that deviations of the actual exchange rate from its long-run PPP value were corrected in subsequent periods. Finally, the high frequency monthly data models did a better job of tracking the turning points of the actual data than the low-frequency quarterly and yearly models.     

Food and beverage television advertising exposure and youth consumption,body mass index and adiposity outcomes

This study examines the relationships between exposure to food and beverage product television advertisements and consumption and obesity outcomes among youth. Individual‐level data on fast food and soft drink consumption and body mass index (BMI) for young adolescents from the Early Childhood Longitudinal Study, kindergarten cohort, (1998–1999) and adiposity measures for children from the US National Health and Nutrition Examination Survey (2003–2004) were combined with designated market area (DMA) Nielsen media advertising ratings data. To account for unobserved individual‐level and DMA‐level heterogeneity, various fixed‐ and random‐effects models were estimated. The results showed that exposure to soft drink and sugar‐sweetened beverage (SSB) advertisements is economically and statistically significantly associated with higher frequency of soft drink consumption among youth even after controlling for unobserved heterogeneity, with elasticity estimates ranging from 0.4 to 0.5. The association between fast food advertising exposure and fast food consumption disappeared once we controlled for unobservables. Exposure to cereal advertising was significantly associated with young adolescents' BMI percentile ranking, but exposures to fast food and soft drink advertisements were not. The results on adiposity outcomes revealed that children's exposure to cereal advertising was associated with both percent body fatness and percent trunk fatness; fast food advertising was significantly associated with percent trunk fatness and marginally significantly associated with percent body fatness; and exposure to SSB advertising was marginally significantly associated with percent body and trunk fatness. The study results suggest that continued monitoring of advertising is important and policy debates regarding the regulation of youth‐directed marketing are warranted.     

Heterogeneous ideas production and endogenous growth: an empirical investigation

Abstract .  We examine the dynamics of ideas production and knowledge-productivity relationship in a panel of 19 OECD countries. A new data set of triadic patents is used. We rigorously address the issues of cross-country heterogeneity and endogeneity. Domestic and foreign ideas stocks exert positive but heterogeneous effects on ideas production. We find evidence of duplicate R&D but little support for endogenous growth. Countries with low domestic ideas bases could considerably improve productivity through ideas accumulation; however, this effect is modest for countries with sizeable ideas bases. An implication is that country-specific R&D policy appears potentially more effective than the one-size-fits-all approach.     

DO MIGRANTS REACT TO INFRASTRUCTURE DIFFERENCE BETWEEN URBAN AND RURAL AREAS? DEVELOPMENT OF AN EXTENDED HARRIS–TODARO MODEL

Developing an extended model of the basic Harris–Todaro model of rural–urban migration, we analyze the effects of infrastructure availability together with time-tested income effects while accommodating government behavior through the provision and financing of infrastructure. Our theoretical analysis confirms that infrastructure presence can be a significant factor in making migration decisions. Comparison with the basic Harris–Todaro model also reveals that while the Todaro paradox is absent in the basic model, it can be present in the extended model.     

A remark on the existence of equilibria in markets without ordered preferences and with a Riesz space of commodities

We show the existence of competitive equilibria in economies without ordered preferences and a Hausdorff locally convex solid Riesz space of commodities. Our principal assumptions are that the commodity space has a predual and that its positive cone has a non-empty interior.     

Public and Private Investment and The Growth Process in Developing Countries

This paper examines the relative contribution of public and private investment to per capita GDP growth in developing countries. It extends the basic neoclassical model of growth by separating investment into its public and private components, and estimates this model for a sample of 95 developing countries over the period 1970–90 using both cross-sectional and panel data. Using data on relative supplies of public and private capital stock, rates of return to public and private investment are also computed. The results suggest that once other determinants of growth, such as human capital formation, population growth, and technical progress, are taken into account, public and private investment have different effects on growth, and that these effects are characterized by marked regional and inter-temporal variations.     

Protecting farm land near cities : Trade-offs with affordable housing in Hawaii

In protecting farm land near cities, policy makers must balance the interests of farmers against affordable housing demands of the urban population. This article examines land use competition between agriculture and housing on the Hawaiian island of Oahu. Land suitability ratings for farming and urban development are compared, and future urban expansion onto agricultural land is simulated under different land use policies. Results indicate severe tradeoffs for affordable housing if all high quality farm lands are strictly preserved. Achieving farmland protection goals will require further policy support to transform the local farm structure from plantation to diversified agriculture.