Factors affecting the price of Swedish forest land, 1965–1987

A model for the determination of the price of forest land is estimated for Sweden from 1965–1987, when (except for a few years) private non-industrial forest owners could finance their holdings at a negative real after-tax borrowing rate. It is assumed that credit has been limited by the value of mortgage security, assessed independently of the price settlement. The estimated coefficients of the regression equation are used for a calculation of the average real rate of discount of forest owners and the average value of amenities. The model also evaluates the effect of the temporary land price regulation from 1979–1987.     

A Note on Green Taxes and Double Dividends

Two highly influential articlesin the literature on green taxes and double dividends are Bovenbergand de Mooij (1994) and Goulder (1995). Goulder's primary concernis whether or not green tax reforms may increase welfare definedexclusive of environmental quality, while Bovenberg and de Mooijprimarily focus on the employment effects of such reforms. Unfortunately,Goulder misinterprets Bovenberg and de Mooij's results in takingthe sign of the uncompensated wage elasticity of labour supplyas being the decisive factor for whether or not welfare exclusiveof environmental quality rises under a green tax reform. Thiserror is pointed out and corrected in this note.     

MEDIEVAL MATCHING MARKETS

We study the regulation of brokerage in wholesale markets in premodern Central Western Europe. Examining 1,804 sets of rules from 82 cities, we find brokerage was primarily a centralized matchmaking mechanism. Brokerage was more common in towns with larger populations, better access to sea ports and trade routes, and greater political autonomy. Brokers' fee structures varied systematically: price-based fees were more common for highly heterogeneous goods, quantity-based fees for more homogeneous goods. We show theoretically that this was broadly consistent with total surplus maximization, and that brokerage was more valuable in markets with unequal numbers of buyers and sellers.     

Response to Seitz and Tödter, 'How the P* Model Rationalizes Monetary Targeting: A Comment on Svensson'

Seitz and TÎdter argue, counter to Svensson, that the P * model provides a rationale for money-growth targeting. In particular, they argue that 'money growth targeting is a special form of inflation forecast targeting based on a "limited" information set. In contrast to "full information" inflation forecast targeting, money growth targeting is likely to be more robust under changing conditions of the real world'.
However, money-growth targeting is better described as a special case of inflation targeting, namely when money growth is considered to be the only predictor of future inflation. But there is overwhelming empirical evidence that there are not only other, but also better, predictors of future inflation than money growth, which makes inflation-forecast targeting superior to money-growth targeting. Inflation-forecast targeting is indeed more robust (in the sense of using available information and allowing judgemental adjustments in a flexible way) than monetary targeting.
In particular, in the P * model, the real money gap is a better predictor of future inflation than money growth, as demonstrated theoretically by Svensson and empirically by Gerlach and Svensson (the empirical finding is also confirmed by Trecroci and Vega). Therefore, inflation-forecast targeting is superior also within the P * model. Under `changing conditions of the real world', for instance after the formation of a monetary union, money growth is likely to be particularly unreliable as a predictor of future inflation, making monetary targeting especially unsuitable and non-robust.     

Illegal Landings: An Aggregate Catch Self-Reporting Mechanism

To solve the problem of illegal landings this article proposes a new tax mechanism based on the regulator's own aggregate catch estimates and ex ante self-reports of planned catch by fishermen. We show that the mechanism avoids illegal landings while ensuring (nearly) optimal exploitation and generating (nearly) correct entry and exit incentives. Finally we simulate the mechanism for the Danish cod fishery in Kattegat to obtain a rough indicator of the size of the tax. It turns out that the average tax payment as a percentage of profit is surprisingly low.     

User Toolkits for Innovation: Consumers Support Each Other

User toolkits for innovation were recently proposed as a means to eliminate (costly) exchange of need-related information between users and manufactures in the product development process. The method transfers certain development tasks to users and thereby empowers them to create their own desired product features. This article examines the implications of different levels of opportunities for consumer involvement (OCI) in product development to learn what happens when firms pass design tasks on to consumers. It explores this issue by studying the relation between the employment of user toolkits and the need for firms to support their consumers. An analysis of 78 computer games products and the amount of support given by firms to the consumers of these products suggests that a share of the costs firms save on information acquisition by letting consumers "do it themselves" may eventually reemerge as costs in consumer support. In other words, an increase in opportunities for consumer involvement seems to increase the need for supporting consumers. A promising solution to the problem of support costs is identified, namely, the establishment of consumer–consumer support interaction. A case study of an outlier in terms of firm support to consumers—Westwood Studios—shows that consumers who use toolkits may be willing to support each other. Such interactive problem solving in a firm-established user community is advantageous to the firm, because the process reduces the amount of resources that the firm itself needs to dedicate to the support of consumers using toolkits. Generally, consumer-to-consumer interaction can facilitate problem-solving in the consumer domain, can aid the diffusion of toolkit related knowledge, and potentially can enhance the outcomes produced by the toolkit approach.     

Estimation of commodity-by-commodity input–output matrices

In this paper we derive a method for the estimation of symmetric input–output tables (SIOTs), which makes it possible to use the commodity technology assumption even when use- and make tables are rectangular. The method also solves the problem of negative coefficients. In the empirical part we derive annual SIOTs in order to evaluate the differences between SIOTs calculated with different methods and the change in technical coefficients over time. Our results, based on data for Sweden, show that the impact of using different technology assumptions is rather large. However, in a factor content of trade application the impact of different technology assumptions does not seem to be very important. Also the size of the changes in the technical coefficients over time is found to be quite large, indicating the importance of calculating SIOTs annually.