Can Weak Substitution be Rehabilitated?

This paper develops a graphical analysis and an analytical model that demonstrate how weak substitution can be used for non-market valuation. Weak complementarity and weak substitution represent preference restrictions that allow us to develop equivalent price changes to describe quantity or quality changes in non-market goods. The price changes are Hicksian equivalents in that they yield the same utility changes as would the quantity or quality changes. After discussion of several potential applications of weak substitution, the paper develops the parallel between the restriction and recent strategies from modeling differentiated goods.     

Can below-replacement fertility be desirable?

In this paper, we challenge the widespread notion that replacement level fertility is the most desirable level of fertility both for countries currently above and below this level. We discuss possible alternative criteria for choosing one fertility level over another. In accordance with earlier studies, we focus on age dependency as the sole criterion. But we do so by relaxing the strong assumption that all individuals of a given age are equal in terms of their economic contribution to society and introduce education as probably the most relevant observable source of population heterogeneity. Our criterion variable is the education-weighted support ratio and we perform thousands of alternative simulations for different constant levels of fertility, starting from empirically given populations. If education is assumed to present a cost at young age and results in higher productivity during working age, then for most countries the desirable long-term total fertility rate turns out to be well below replacement level.     

Are women expected to be more generous?

This paper analyzes if men and women are expected to behave differently regarding altruism. Since the dictator game provides the most suitable design for studying altruism and generosity in the lab setting, we use a modified version to study the beliefs involved in the game. Our results are substantial: men and women are expected to behave differently. Moreover, while women believe that women are more generous, men consider that women are as generous as men.

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Electronic Supplementary Material  The online version of this article () contains supplementary material, which is available to authorized users. We appreciate comments from Josemari Aizpurua, Shoshana Neuman and participants in seminars at Bar-Ilan University, Max Planck Institute of Economics, Univ. Publica Navarra. Tim Cason and one anonymous referee made substantial comments on the previous draft. Financial support from CICYT (SEJ2007-62081/ECON and SEJ2006-00959/SOCI) and FCEA (SOC2.05/43) is gratefully acknowledge. Martha Gaustad revised the English grammar.     

Can feminist thought make economics more objective?

Feminist research is often perceived to be less objective than conventional research on the grounds that the latter is value-neutral and the former is not. This essay shows that a major problem with the familiar standards for maximizing objectivity that permit such a conclusion is that they are too weak. They have no resources for detecting widespread cultural assumptions, values and interests, such as the androcentric ones to which feminist work draws attention. Good method works by identifying cultural values that differ between researchers or research communities. However, since androcentric values are often culture-wide, something more rigorous than only conventional good methods evidently are needed for researchers to be able to identify them.Thus feminist research does not introduce political assumptions, values and interests into research fields that are otherwise value-neutral; it identifies the ones that are already there. Rejecting the debilitating relativist stance usually seen as the only alternative to conventional standards for maximizing objectivity, feminist thought increases the objectivity of research. This essay reviews recent arguments in both conventional and feminist philosophy and history that support this analysis, and shows how it leads to the construction of stronger standards of objectivity than the conventional only “weak objectivity” that is dependent upon the neutrality ideal. Paradoxical though it may appear, “strong objectivity” requires the kind of conscientious socially situated production of knowledge characteristic of feminist work in economics.     

Can Poverty be Alleviated in China?

The 2000s witnessed the third poverty alleviation wave in China. Compared with its predecessors, the third wave distinguished itself by new interventions and redefined standards for the National Poor Counties. This paper evaluates the effectiveness of the new program using a data set consisting of 1,411 of China's western and central counties from 2000 to 2010. It combines the propensity score matching method with the difference‐in‐differences approach, which helps to avoid selection bias and track the policy impact on variables of interest at each time point. It is found that the non‐western local governments tended to manipulate data on income and output growth to maintain the special transfer payments disbursed exclusively to the National Poor Counties. It is also shown that the program failed to improve the infrastructure and sanitary conditions in general.     

Can capacity markets be designed by democracy?

In the United States, Regional Transmission Organizations (RTOs) operate the power grid serving nearly 70% of electricity customers and are critical organizations for ensuring reliable system operations and facilitating the integration of new technologies and market participants. RTOs are designed to be stakeholder-driven organizations, with rules and policies crafted through a highly participatory process. While the decisions that RTOs make have implications for industry, society and the environment, their decision processes have not been modeled in any systematic way. In this paper, we develop a modeling framework for the stakeholder process of PJM, an RTO serving thirteen states plus the District of Columbia, adapting some of the seminal literature from political science and political economy on the theory of voting systems. This modeling framework can generate predictions of stakeholder process outcomes, identify strong coalitions among stakeholders and identify shifts in political power in the formulation of RTO market rules. We illustrate this analysis framework using a detailed data set from stakeholder deliberations of capacity market reform in PJM. Our model predicts that the current structure of the stakeholder process in PJM makes the passage of capacity market reforms through the stakeholder process virtually impossible because it creates strong coalitions that would favor or oppose changes to capacity market rules. In the capacity market case, we also identify a small subset of voters that act as swing voters and confirm that political power is shifted to these voters by deviations from otherwise strong coalitions and abstentions from the voting process altogether. Our framework represents the first attempt to model the decision-making behavior of RTOs in any systematic way, and points towards emerging research needs in evaluating the governance structure of RTOs.     

Can student effort be manipulated? Does it matter?

This article provides evidence that college students’ effort can be manipulated substantially by making changes in the college testing regime and moreover that student effort is a meaningful input in education production. The evidence comes from a quasi-experiment where a mid-semester test with a pass requirement is introduced to a mandatory one-semester Business School course in Macroeconomics. Four cohorts of students – one before and three after the introduction of the pass requirement – have reported their study effort twice during the semester, and the relationship between achievement and study effort is investigated by using a within-subject within-student across-study periods approach.