Land Markets, Risk and Distress Sales in Nicaragua: The Impact of Income Shocks on Rural Differentiation

Farmers in the Nicaragua countryside face substantial risk due to legal uncertainty regarding property rights, price fluctuations and limited access to rural financial markets. Income shocks can lead to obligations to sell land, can fuel differentiation processes, and can drive people into poverty. We review empirical evidence on income shocks and related distress sales by households of different wealth endowments. From panel data of the 1995 and 2000 land market surveys, estimates are made to identify relevant farm household characteristics and the market forces that determine distress sales. Results show that small farms are most affected by idiosyncratic shocks and usually try to adopt a defensive strategy based on reduced consumption to retain their land resources. In the long run, this strategy occasionally succeeds in preserving land ownership and maintaining income at higher levels than those enjoyed by landless peasants. But the pressures towards distress sales can, nevertheless, be powerful, and different responses to income shocks by poor, middle and rich peasants are likely to increase rural differentiation.     

Adjustment costs and time-to-build in factor demand in the U.S. manufacturing industry

In order to explain cyclical behavior of factor demand, the static neoclassical model of the firm has been extended to include either adjustment costs (e.g. Lucas (1967)) or time-to-build considerations as in Kydland and Prescott (1982). This paper presents an intertemporal factor demand model which accounts for adjustment costs and gestation lags. The closed form solution of the model is a highly restricted vector ARMA-process that is estimated using quarterly data for the manufacturing industry in the U.S., 1960–1988. The main conclusion is that both sources of dynamics of factor demand are identifiable and found to be empirically of importance.     

MANAGING VENDOR INVENTORY IN A DUAL LEVEL DISTRIBUTION SYSTEM

Collaborative arrangements among members of the supply chain have received a great deal of interest in recent years as a means of reducing costs. One such arrangement is vendor managed inventory (VMI). VMI allows the vendor to make decisions concerning the quantity and timing of deliveries to the retailer. Such an arrangement offers the potential of a more efficient supply chain by removing the negative effects of retail ordering policies. A thorough review of the literature was conducted to identify factors likely to impact the performance of a VMI partnership. Computer simulation was used to study the effects of these factors from both the vendor's and retailer's perspectives. The results lend insight into the performance of VMI and guidance for managers as to the environments in which VMI is most effective.     

Capital Mobility, Agglomeration and Corporate Tax Rates: Is the Race to the Bottom for Real?

Based on a data set for 19 OECD countries for the period 1981–2001,we estimate the impact of FDI on corporate tax rates, wherechanges in FDI are a measure for changes in capital mobility.So far the literature has been concerned with the related butrather different question as to the sensitivity of FDI to taxrates. Our article takes an opposite perspective and asks whatthe impact of capital mobility is on corporate tax rates. Indoing so, we explicitly take the role of agglomeration intoaccount. In theory, core countries can afford a higher tax ratecompared to peripheral countries. In our estimation strategy,we instrument capital mobility to deal with reverse causality.The main conclusion is that increased international capitalmobility, measured by FDI flows, implies a lower corporate taxrate. But we also find that agglomeration matters: core countrieshave a higher corporate tax rate than peripheral countries.If there is a race to the bottom, it seems that it is more realfor some countries than others. (JEL code: H25)     

Intertemporal market division:: A case of alternating monopoly

In this paper, we report on an equilibrium with market dominance that exists in a simple two-firm model that features neither entry barriers nor sophisticated punishment strategies. This equilibrium induces an intertemporal market division in which the two firms alternate as monopolists - despite the fact that the model also sustains a Cournot duopoly. Even when initially both firms are active in the market, the alternating monopoly reveals itself rather quickly. Moreover, it Pareto dominates the Cournot equilibrium - as it is close to the cartel outcome. Several examples of what well may be such alternating monopolies are presented.     

The Importance of Monitoring for Developing Intra-Group Trust in Ethiopian Female Workgroups

We examine the relation between intra-group trust and monitoring in a patriarchal society, and how this relation affects workgroup performance. Data were collected from 352 women who were members of 72 female workgroups in Addis Ababa by means of field experiments and a survey. The data are analyzed using multiple mediation analysis. We find that intra-group trust needs time to develop, and that trust is higher in workgroups with more monitoring. The positive relation between monitoring and trust might be explained by women’s ambition to overcome disempowerment and negative gender stereotypes. The results also indicate positive effects of intra-group trust and monitoring on workgroup performance, and that the effect of monitoring runs through its relation with trust. The last finding stresses the importance of monitoring for developing intra-group trust in these female workgroups.     

Can tourism be part of the decarbonized global economy? The costs and risks of alternate carbon reduction policy pathways

Global leaders agree on the need to substantially decarbonize the global economy by 2050. This paper compares potential costs associated with different policy pathways to achieve tourism sector emission reduction ambitions (?50% by 2035) and transform the sector to be part of the mid-century decarbonized economy (?70% by 2050). Investment in emissions abatement within the tourism sector, combined with strategic external carbon offsets, was found to be approximately 5% more cost effective over the period 2015–2050 than exclusive reliance on offsetting. The cost to achieve the ?50% target through abatement and strategic offsetting, while significant, represents less than 0.1% of the estimated global tourism economy in 2020 and 3.6% in 2050. Distributed equally among all tourists (international and domestic), the cost of a low-carbon tourism sector is estimated at US$11 per trip, equivalent to many current travel fees or taxes. Exclusive reliance on offsetting would expose the sector to extensive and continued carbon liability costs beyond mid-century and could be perceived as climate inaction, increasing reputational risks and the potential for less efficient regulatory interventions that could hinder sustainable tourism development. Effective tourism sector leadership is needed to develop a strategic tourism policy framework and emission measurement and reporting system.     

Land rental market, off-farm employment and agricultural production in Southeast China: A plot-level case study

This paper performs a plot-level analysis of the impact of land rental market participation and off-farm employment on land investment, input use, and rice yields for 215 plots cultivated by 52 households in three villages in Northeast Jiangxi Province. Our findings show that households that rent extra land are relatively more productive, but contradict results of earlier studies which found that tenure status of plots affects the level of land investments. We further find that off-farm employment does not significantly affect rice yields. This result contradicts those of earlier studies which found that the negative lost-labor effect of off-farm employment dominates the positive income effect. Another novel finding is that people working locally off-farm tend to switch from green manure planting towards the use of organic manure on their rice plots. We conclude that policies that will further stimulate the development of land rental markets, which is still in its infancy, can contribute significantly to higher rice production in Southeast China. Another implication of our results is that worries about the negative impact that the continuously growing off-farm employment may have on China's goal to remain self-sufficient in grain production are less relevant at the moment for the region examined in our study.     

Business incomes in rural Nicaragua: the role of household resources,location, experience and trust

This paper analyses the determinants of business income for rural households in Nicaragua. A sample of 1030 households was studied in order to assess the importance of material and behavioural factors that influence income from business activity. The households are involved in manufacturing, trade, services or have a mixture of businesses. They generally have a low income and asset value. Households supplement their income from wages and agricultural activities. To estimate non-farm business income per employed person we analyse the impact of resources, location, entrepreneurial experience and trust. Our results show that household resources and entrepreneurial experience are significant determinants for business income in all sectors. Trust is also important, particularly generalized trust. The contribution of other forms of trust, such as institutional trust, depends on the sector in which households participate.     

How do trust and property security influence household contributions to public goods?: The case of the sloping land conversion program in China

Trust and property rights are generally considered to influence farmers' behavior regarding resource use and environmental management. Previous studies show that higher trust levels may enhance contributions to public goods. This paper investigates how trust and (land) property rights security influence the provision of one concrete public good: land protection through the Sloping Land Conservation Program in China. The analysis is based on household survey data from Ningxia Autonomous Region in China. From our questionnaire two trust factors are derived and distinguished, using factor analysis: general trust and kinship trust. Farm households are less likely to contribute to public goods when they perceive more secure land rights, but trust has mixed effects on public goods. The results show that general trust and kinship trust may rely on two opposite effects for influencing public goods provision. On the one hand, high levels of general trust may directly enhance people's willingness to provide contributions to public goods (by reduced likelihood to reconvert forest land) when farmers are aware of the positive environmental effects of the program, that's the public goods effect. On the other hand, general trust may also make it more likely that people invest more in their own private goods to pursue their own welfare (a more likely reconversion of forest land to arable land), that's the private goods effect. The final outcome depends on the size and direction of both effects. Compared to general trust, kinship trust is more inward-looking and self- or group-interested compared to more reciprocal general trust. Thus, unlike general trust, kinship trust may have no significant public goods effect on the provisioning of public goods.