Modeling producer responses with dynamic programming: a case for adaptive crop management

Past research found agricultural producers’ conditional responses during the growing season are important adaptations to weather and other stochastic events. Failing to recognize these responses overstates the risks confronting producers and understates their ability to respond to adverse circumstances. Dynamic programming (DP) provides a means for determining optimal long‐term crop management plans. However, most applications in the literature base their analysis on annual time steps with fixed strategies within the year, effectively ignoring conditional responses during the year. We suggest an alternative approach that captures the strategic responses within a cropping season to random weather variables as they unfold, reflecting farmers’ ability to adapt to weather realizations. We illustrate our approach by applying it to a typical cereal farm in Karak, Jordan. The results show that including conditional within‐year responses to weather reduces the frequency of fallowing by 23% and increases expected income by 9%.     

Untangling gender differentiated food security gaps in Bhutan: An application of exogenous switching treatment regression

Using nationally representative data from Bhutan, and applying an exogenous switching treatment regression model, this study assessed the food security status between male‐headed households (MHHs) and female‐headed households (FHHs). The study demonstrates that there is no significant difference between MHHs and FHHs in terms of food security, but when MHHs are compared with de jure FHHs, the food security is significantly lower among the de jure FHHs. The food security gap between MHHs and de jure FHHs is due to the differences in both observable and unobservable characteristics of the households. The food security gap between de facto and de jure FHHs can be explained by the influence of connections and wider access to off‐farm income. Most of the previous studies consider all FHHs as a homogenous entity and ignore the concept of de jure FHHs (i.e., a household run by single, widowed, or divorced woman) and de facto FHHs (i.e., a household where there is a husband, but he is not physically present because of his work off‐farm). As the present research takes this into account, the econometric findings from our study, thus have important implications in formulating special food security policies targeting the most vulnerable FHHs.     

Making Globalization Inclusive: Job Creation and Wage Inequality in Developing Economies

Open Economies Review -     

The political economy of immigration in a direct democracy: The case of Switzerland

In this paper, we analyze the determination of immigration policy in a direct democracy setting. We formulate a model of voting and participation behavior integrating instrumental and expressive motivations. The model is estimated using data drawn from a survey carried out after a vote in Switzerland in 2000 on a popular initiative proposing to implement immigration restrictions. The model enables us to recover estimates of participation costs and preferences towards immigration and analyze how these preferences are translated into actual voting outcomes. The results reveal a substantial gap (“participation bias”) between attitudes towards immigration in the general population (43% favorable to restrictions) and the outcome of the vote (26%).     

Cross‐Country Variability in Cost of Raising Equity: Evidence from Seasoned Equity Offerings

We examine how county‐level governance affects the cost of raising equity. Using data on seasoned equity offerings, we find that the underwriting spread is determined by the litigation risk of issue certifiers, and offer underpricing is largely determined by the investment risk of the equity issue. Underwriting spread increases with enhanced legal enforcement, offsetting the reduction in underpricing associated with strong legal enforcement. Our study offers insight into the effect of legal enforcement and regulatory policy on the cost of raising equity.     

Corporate governance and returns to emerging economy firm acquisitions in tax havens: An empirical test on Indian firms

Cross‐border acquisitions (CBAs) by emerging economy firms are known to yield positive stockholder returns. A nontrivial fraction of CBAs by emerging economy firms are in tax havens. We argue because of weak corporate governance in emerging economies and the secrecy afforded by tax havens, emerging economy firm CBAs in tax havens yield lower stockholder returns than their CBAs in nontax havens. We also argue the negative effect of tax haven destinations is greater for firms with greater business group ownership and for firms with greater foreign insider ownership. Furthermore, we argue the negative effect of tax haven destinations is mitigated for firms whose stock is actively traded in the market. Empirical tests in a sample of nearly 800 CBAs by Indian firms from 2002 to 2011 support our hypotheses. Our study contributes to a better understanding of stockholder returns to CBAs by emerging economy firms and the influence of corporate governance on these returns.     

Covariate and Idiosyncratic Shocks and Coping Strategies for Poor and Non-poor Rural Households in India

The objective of the paper is to track the association between different type of shocks experienced by rural households and corresponding coping strategies opted by them as they are, not only exposed to household-level and community level shocks, but also, lack effective risk management strategies which make them vulnerable to get into chronic poverty. A probit analysis has been used to articulate the comparative static distinction of risk management strategies between poor and non poor rural households using Additional Rural Incomes Survey/Rural Economic and Demographic Survey (ARIS/REDS) data surveyed by National Council of Applied Economic Research (NCAER) in rural India across 17 states to get a comparative static analysis. Households, generally, withdraw savings, seek remittances from migrant family members, take loan from formal and informal lenders and sell their existing assets and participate in Government sponsored welfare based programs to control after effect of shocks. Comparatively non-poor rural households could build up safety net (precautionary measure) to cope with price rise and other sudden shocks. But, extremely poor, generally, if don’t get help from relatives or can’t borrow from informal sources, ultimately starve at the time of sudden shocks. The welfare based government programs fail to arrest this extreme situation of grief during the idiosyncratic shocks.

     

全球性量化宽松意味着全球性长期通胀

【摩根士丹利7月3日】目前,许多国家的总体通胀率已陷入负区间,而全球经济才刚刚摆脱“大衰退”。在这种情况下担忧通胀风险,如果不说是荒唐,似乎至少也是为时过早。现在看来,大多数投资者并不担心通胀风险。事实上,根据市场数据推算,目前美国和欧元区的10年期通胀预期都不到2％,低于过去十年间的实际通胀率。但我们认为,市场对长期通胀风险过于乐观了;未来十年的通胀率看来更有可能大大超过、而非低于过去十年间的平均通胀率。     

Can Elected Minority Representatives Affect Health Worker Visits? Evidence from India

This paper examines the relationship between elected minority representatives, i.e. Scheduled Castes (SC) and Scheduled Tribes (ST) and health worker visits in rural India. We estimate the effect of minority representation on the frequency of visits to villages by health workers by exploiting the state variation in the share of seats reserved for the two minority groups in state legislative assemblies mandated by the Constitution of India. Using data from state and village level surveys on 15 major Indian states, we find that ST representatives increase the frequency of visits by both doctors and mobile medical units. In contrast, SC representatives have a tendency to decrease the frequency of visits by mobile medical units. Potential explanations for the differential impact of SC and ST representatives are also explored, including geographic isolation, support for the Congress Party, a shift in power, and relative population shares.