The Liberalisation of Rail Transport in the EU

On 1 January 2007 the European rail freight market, which has long suffered from fragmentation and a declining share of total transport services, will be fully opened to competition. What will be the consequences for the transport sector and the economy as whole? What further measures are needed to stabilise or increase the railways' share in the freight market? * Member and speaker of the EPP-ED Group (Christian Democrats) in the Committee on Transport and Tourism; rapporteur of the European Parliament responsible for railway issues. ** Views expressed here are not those of NDU or Minnesota.     

The Economic Impact of the Lack of Transparency in Financial Reporting

Off-balance-sheet amounts are in the trillions of dollars, not including all transactions with off-balance-sheet implications. Financial managers and consultants intentionally structure transactions that are abusive of off-balance sheet accounting rules, which leads to a lack of transparency in financial reporting. This paper explores several ways in which companies manipulate off-balance sheet transactions to satisfy personal and business objectives as well as the impact of such manipulations. It is time for regulatory bodies to close the loopholes, eliminate overly rules-based standards, clearly state the economic objective of each standard, and require firms to disclose the economic motivations for the accounting practices they adopt.      

A modest proposal for inclusion of women's household human capital production in analysis of structural transformation

Neoclassical economists posit a set of stylized facts which mark the structural transformation of national economies. Yet these facts, when disaggregated by gender, exhibit puzzling anomalies. For the 132 countries in our sample, female rates of economic activity are much lower than men's, and GDP per capita accounts for less than 16 percent of the variation in female rates. We argue that the missing female labor is occupied in a fourth sector – production and maintenance of human capital. Utilizing a series of heroic assumptions, the paper makes a first rough estimate of the value of this sector on a country-by-country basis.     

Hospital Cost Containment and Length of Stay: An Econometric Analysis

In recent years, concern in the United States over rising health care costs has led to precipitous reductions in the lengths of hospitalizations. While perceptions of compromised medical care quality following this practice and others have prompted policy makers to consider stricter regulation of health insurance organizations, little attention has been given to the extent to which length of stay reductions are responsible for decreasing hospital costs. This paper provides empirical evidence on that point. The method utilizes a hospital total operating cost function estimated on 2792 U.S. hospitals for the period 1987-1992. Three different panel data estimating techniques are applied, including a random effects model that is distinctive in allowing for correlation between hospital effects and observable regressors, circumventing inconsistency problems following from standard generalized least-squares estimations. The cost elasticity of length of stay is calculated from the regression results. This measure is low, falling in the range 0.09-0.12. It suggests that common perceptions regarding the extent of cost savings resulting from length of stay reductions have been overestimated.     

Reliability of recall in agricultural data

Despite the importance of agriculture to economic development, and a vast accompanying literature on the subject, little research has been done on data quality. Due to survey logistics, agricultural data are usually collected by asking respondents to recall the details of events occurring during past agricultural seasons, potentially leading to recall bias. The problem is further complicated when interviews are conducted over the course of several months, thus leading to recall of variable length. To test for recall bias, the length of time between harvest and interview is examined for three African countries with respect to several common agricultural input and harvest measures. The analysis shows little evidence of large recall bias impacting data quality. There is some indication that more salient events are less subject to recall decay. Overall, the results allay some concerns about the quality of some types of agricultural data collected through recall over lengthy periods.     

The Effects of Wind Turbines on Property Values in Ontario: Does Public Perception Match Empirical Evidence?

The increasing development of wind energy in North America has generated concerns from nearby residents regarding potential impacts of wind turbines on property values. Such concerns arose in Melancthon Township (in southern Ontario) following the construction of a large wind farm. Existing literature has not reached a consensus regarding the nature of these impacts. This paper applies a hedonic approach to detailed data on 5,414 rural residential sales and 1,590 farmland sales to estimate the impacts of Melancthon's wind turbines on surrounding property values. These impacts are accounted for through both proximity to turbines and turbine visibility—two factors that may contribute to a disamenity effect. The results of the hedonic models, which are robust to a number of alternate model specifications including a repeat sales analysis, suggest that these wind turbines have not significantly impacted nearby property values. Thus, these results do not corroborate the concerns raised by residents regarding potential negative impacts of turbines on property values.     

Exposure Triggers and Allocation Methods: Learning Lessons From Prior Court Rulings

This study provides a review of some of the major court rulings that have shaped and continue to shape the commercial general liability (CGL) market. The evolution of the concepts of "triggers" and allocations systems is examined to gain a perspective on the way in which courts reinterpret contract language to apply to new and emerging exposures. A review of the issues impacting the CGL provides valuable insights into the way court rulings can create a significant impact in the insurance market. A stream of court decisions provides the backdrop for today's challenges, including the reemergence of asbestos claims. The study also fills a gap in the literature related to the crisis in the CGL marketplace and changes in the pricing, regulation, and solvency of insurers operating in those lines. As old risks continue to evolve and new risks emerge, courts have begun to reinterpret liability contracts in much the same way as they reinterpreted contracts with regard to pollution and products in the 1970s and 1980s. Recent rulings related to asbestos and environmental liability underscore the importance of these issues in today's marketplace. By reviewing these events related to the CGL policy, insurers, insureds, and regulators may gain a new perspective on the importance of developing a clear standard wording that will be consistently interpreted in light of new exposures.