Luck or insight? The Simon–Ehrlich bet re-examined

After a long argument about the effect of population growth on the availability of resources, Julian Simon and Paul Ehrlich undertook a $1,000 bet in October1980. The wager concerned the inflation-adjusted prices of five metals. If, over ten years, prices rose, Simon would pay Ehrlich. If they fell, Ehrlich would pay Simon. In October 1990 Ehrlich mailed Simon a cheque, as the real price of the five-metal basket of commodities had fallen by 36 per cent. Since then, some researchers have argued that Simon ‘got lucky’; over other periods the result would have been different. We review data from 1900–2019 and find that, if war years are excluded, Simon would have won the bet 69.9 per cent of the time. During this 119-year period, the time price of the five-metal basket fell by 87.2 per cent despite both US and world populations having grown substantially.     

Plant Level Productivity, Efficiency, and Environmental Performance of the Container Glass Industry

This paper presents a methodology and empirical results based on theMalmquist productivity index. We measure productivity while treatingpollution as an undesirable output. Our estimates show that technicalchange has contributed to productivity and environmental performancegrowth in the container glass industry, an energy and pollution intensivesector. Changes in inter-plant efficiency over time have made thisproductivity growth more rapid than otherwise would have occurred withthe underlying technical change. The efficiency estimates show that thereare both opportunities to improve productivity and reduce pollution in thisindustry, as well as productivity losses associated with the emissionscontrol. The shadow prices for NOx, the undesirable output we analyze,is quite high compared to other regulated sectors.     

Incomplete markets and incentives to set up an options exchange

Traditional analyses with incomplete markets take the securities that are traded as exogenous. In this paper we endogenize the market structure by considering incentives to introduce (costly) options exchanges which issue derivative securities. The method of financing the exchange is critical in determining whether the market structure is socially efficient. If the exchange can charge fees to all agents and make every agent's participation a necessary condition for establishing the exchange then the market structure chosen in equilibrium is efficient. However, if either of these conditions is not satisfied then an inefficient market structure may be chosen.We would like to thank the editor, Herakles Polemarchakis, and an anonymous referee for helpful comments and suggestions. Financial support from the NSF (Grant nos. SES-8813719 and SES-8720589 for the two authors respectively) is gratefully acknowledged.     

Skills, Flexible Manufacturing Technology, and Work Organization

This study employs a national survey of over 3000 U.S. manufacturing establishments to explore associations between worker skill requirements and use of production and telecommunications technologies, work organization, and other management practices. Ordered probit equations show an empirical link between increases in each of six types of skill requirements, as reported by plant managers, and the use of flexible technologies and work organization practices. Technology use is most strongly linked to computer skill requirements. Work organization practices were strongly associated with problem-solving and interpersonal skill increases, suggesting that new work organization practices are broadening the set of skills sought by manufacturers. Traditional academic skills (e.g., math and reading) also were linked to the use of flexible technologies and work organization practices, but increases in these skill requirements were reported less frequently than were requirements for computer, interpersonal, and problem-solving skills.     

Network architecture, salience and coordination

This paper reports the results of an experimental investigation of dynamic games in networks. In each period, the subjects simultaneously choose whether or not to make an irreversible contribution to the provision of an indivisible public good. Subjects observe the past actions of other subjects if and only if they are connected by the network. Networks may be incomplete so subjects are asymmetrically informed about the actions of other subjects in the same network, which is typically an obstacle to the attainment of an efficient outcome. For all networks, the game has a large set of (possibly inefficient) equilibrium outcomes. Nonetheless, the network architecture makes certain strategies salient and this in turn facilitates coordination on efficient outcomes. In particular, asymmetries in the network architecture encourage two salient behaviors, strategic delay and strategic commitment. By contrast, we find that symmetries in the network architecture can lead to mis-coordination and inefficient outcomes.