On estimating the reliability after sequentially estimating the mean: The exponential case

Sequential estimation problems for the mean parameter of an exponential distribution has received much attention over the years. Purely sequential and accelerated sequential estimators and their asymptotic second-order characteristics have been laid out in the existing literature, both for minimum risk point as well as bounded length confidence interval estimation of the mean parameter. Having obtained a data set from such sequentially designed experiments, the paper investigates estimation problems for the associatedreliability function. Second-order approximations are provided for the bias and mean squared error of the proposed estimator of the reliability function, first under a general setup. An ad hoc bias-corrected version is also introduced. Then, the proposed estimator is investigated further under some specific sequential sampling strategies, already available in the literature. In the end, simulation results are presented for comparing the proposed estimators of the reliability function for moderate sample sizes and various sequential sampling strategies.     

Performance lies are hazardous to organizational health

Performance lies arise both from individual and from situational causes, but in this article, the attention is on situational causes. These are generally triggered by loyalty to the coalition, which is expressed through the continued use of performance lies. Because performance lies help create a boundary around the coalition that insulates its activities from top management, performance lies enable members of the coalition to exercise a greater degree of internal control. Naturally, such lies are dysfunctional, resulting in the avoidance of difficult issues and problems and compromising the organization's ability to adapt to a changing environment based on accurate information.     

The micro-foundations of intertemporal price discrimination

Summary. This paper investigates the optimality of intertemporal price discrimination for a durable-good monopoly in a model where infinitely-lived households face an intertemporal budget constraint, and consume both durable goods and non-durable goods. We prove that the optimal price of the durable good is not constant, and may decrease or increase over time. Some households may choose to purchase the durable good at a later date, and pay lower or higher prices, since the gain in discounted utility of consuming more of the non-durable good more than compensates for the loss in utility from delaying the consumption of the durable good.Received: 12 March 2004, Revised: 7 January 2005, JEL Classification Numbers: D40, D42, D91.I would like to thank C.D. Aliprantis, the Editor, and an anonymous referee for their generous advice, and constructive comments and suggestions. I have also enjoyed discussions with John Quah on the subject. Research support from the Wharton-SMU Research Centre, Singapore Management University, is gratefully acknowledged.     

Integrating ecosystem services into conservation assessments: A review

A call has been made for conservation planners to include ecosystem services into their assessments of conservation priority areas. The need to develop an integrated approach to meeting different conservation objectives and a shift in focus towards human wellbeing are some of the motivations behind this call. There is currently no widely accepted approach to planning for ecosystem services. This study contributes towards the development of this approach through a review of conservation assessments and the extent to which they include ecosystem services. Of the 476 conservation assessments identified by a set of search terms on the Web of Science, 100 were randomly selected for this review. Of these only seven had included ecosystem services, while another 13 had referred to ecosystem services as a rationale for conservation without including them in the assessment. The majority of assessments were based on biodiversity pattern data while 19 used data on ecological processes. A total of 11 of these 19 assessments used processes, which could be linked to services. Ecosystem services have witnessed an increase in attention received in conservation assessments since the year 2000, however trends were not apparent beyond this date. In order to assess which types of ecosystem services and how they have been accounted for in conservation assessments, we extended our review to include an additional nine conservation assessments which included ecosystem services. The majority included cultural ecosystem services, followed by regulatory, provisioning and supporting services respectively. We conclude with an analysis of the constraints and opportunities for the integration of ecosystem services into conservation assessments and highlight the urgent need for an appropriate framework for planning for ecosystem services.     

Robust political economy

This paper introduces the idea of “robust political economy.” In the context of political economic systems, “robustness” refers to a political economic arrangement's ability to produce social welfare-enhancing outcomes in the face of deviations from ideal assumptions about individuals' motivations and information. Since standard assumptions about complete and perfect information, instantaneous market adjustment, perfect agent rationality, political actor benevolence, etc., rarely, if ever actually hold, a realistic picture and accurate assessment of the desirability of alternative political economic systems requires an analysis of alternative systems' robustness. The Mises-Hayek critique of socialism forms the foundation for investigations of robustness that relax ideal informational assumptions. The Buchanan-Tullock public choice approach complements this foundation in forming the basis for investigations of robustness that relax ideal motivational assumptions. JEL Code B53, P16, P26     

Small Leading Firms*

We formally analyze the question of whether a price leader must control a large share of the market. Our main result is that if other producers have rising marginal costs and behave as price takers, even the smallest firm in a competitive industry with a rising supply curve can enhance its profits by cutting output and raising price, becoming a price leader. Therefore, we would expect pure competition to be destroyed under these technological conditions.     

DOES WORKSHARING WORK? SOME EMPIRICAL EVIDENCE FROM THE IAB‐ESTABLISHMENT PANEL

Recent policy debate in Europe suggests that a shorter workweek will lead to more jobs (worksharing). We derive and estimate a model where the firm employs two types of workers, some working overtime, the rest standard hours. Worksharing is not always a prediction of the theory. Using German establishment‐level panel data (the IAB‐ESTABLISHMENT panel), 1993–1999, we find no evidence of pro‐worksharing effects except in small plants in the East German non‐service sector. There is evidence that a cut in standard hours lowers the proportion of overtime workers in a plant, as predicted by the theory, and increases the proportion of standard‐time plants.     

Indigenous livelihoods, slash-and-burn agriculture, and carbon stocks in Eastern Panama

Improved crop–fallow systems in the humid tropics can simultaneously sequester atmospheric carbon emissions and contribute to sustainable livelihoods of rural populations. A study with an indigenous community in eastern Panama revealed a considerable biophysical potential for carbon offsets in small-scale slash-and-burn agriculture through longer fallow periods, improved fallow management, secondary forest development, and agricultural intensification. Based on soil and biomass carbon measurements, estimated annual sequestration rates amount to 0.3−3.7 t C ha^− 1 yr^− 1. Despite such potential, the economic benefits of initiatives aimed at sequestration of carbon in the community are likely to be rather unequally distributed within the community. Heterogeneity in livelihood strategies and uneven asset endowments among households – factors often overlooked in the ongoing carbon and sustainable development debate – are expected to strongly affect household participation. Indeed, only the better-endowed households that have also managed to diversify into more lucrative farm and non-farm activities are likely to be able to participate in and thus benefit from improved crop–fallow systems that capture carbon. Economic, ethical, institutional, and technical concerns need to be taken into account when designing community carbon management and investment plans.