Cost-Effective Targeting of Land Retirement to Improve Water Quality with Endogenous Sediment Deposition Coefficients

An integrated framework that combines spatial and biophysical attributes of land with a hydrological model and an economic model is developed to identify cropland for enrollment in the Conservation Reserve Enhancement Program. Sediment deposition coefficients are determined endogenously depending on the land-use decisions on other land parcels. Application of this framework to a watershed in Illinois demonstrates that highly sloping land adjacent to water bodies should be selected for retirement. A marginal value rental payment scheme can achieve program goals of 20% sediment abatement at 39% lower cost than a productivity-based rental scheme.     

EVIDENCE ON THE COMPENSATION OF PORTFOLIO MANAGERS

We surveyed 396 portfolio managers about the structure of their compensation. Overall, more compensation packages are subjective/discretionary than objective/formula based. Firm success factors such as firm profitability have more effect on bonuses than do client success factors such as investment performance. Differences in the structure of compensation across firms, clients, job types, and manager characteristics reflect likely differences in the underlying contracting environments, especially differences in the difficulty of monitoring performance and exerting control.     

Is Geographical Targeting Cost-Effective? The Case of the Conservation Reserve Enhancement Program in Illinois

This paper uses economic, hydrologic, and GIS modeling to assess the effectiveness of the Illinois Conservation Reserve Enhancement Program in the Lower Sangamon watershed. Our results show that for a representative five-year storm event, the acres currently enrolled in the program result in a 12% reduction in sediment loading, which is below the program goal of 20% and four times the least-cost solution. We also analyze the design of alternative rental payment instruments for improving the cost-effectiveness of geographical targeting for land retirement. Policy implications for the characteristics of the land parcels that should be targeted for enrollment in the program are discussed.     

What about sustainability? Understanding consumers' conceptual representations through free word association

The United Nations (UN) conceptualizes sustainability as development that meets the current needs of the planet's populations, but without compromising the ability of future generations to meet their own needs. Although the concept of sustainability has been widely discussed in the international political agendas, inconsistent interpretation and ambiguity of the concept by consumers is observed. In this paper, the understanding of the term sustainability amongst Brazilian consumers is reported. Using the word association projective technique, the participants were asked to write down all the words that came to their mind when thinking about “sustainability.” Thematic content analysis was performed by grouping words by similarity of meaning in categories, which were further submitted to correspondence analysis (CA) to create a perceptual map. Brazilian consumers made different associations reflecting the complexity and multidimensionality of the concept amongst different groups of consumers. The most frequently cited categories are related to environment, health and nutrition, behaviour, production and economy and sustenance. CA accounted for 76.7% of the data variance and the perceptual map evidenced that younger individuals with higher education made associations with categories related to the current concept of sustainable development, similar to that proposed by UN. Moreover, consumers with basic education were associated with categories related to food and sustenance. The findings of this study can contribute to the formulation of education strategies directed towards different social groups, besides directing further research on consumer behaviour.     

The Term Structure with Semi-credible Targeting

The Federal Reserve sets targets for interest rates which it enforces through direct market intervention. These targets are changed periodically. In this paper, we develop a term structure model in which the short rate is subject to a control which keeps it close to a target which changes from time to time. The probability of target changes is not constant in the model, but changes as a function of observables. The model performs well at explaining the shifts in the yield curve that accompany target changes.