CAPITAL BUDGETING,INTERTEMPORAL PROGRAMMING MODELS,WITH PARTICULAR REFERENCE TO AGRICULTURE

Investment decision processes typically involve the selection of projects, the timing of their initiation and the determination of the amount to be invested in each time period. A linear programming model considered appropriate for solving such models is described, in which the multi-dimensional criterion function is expressed as a linear combination of the appropriately-weighted objectives. An empirical application is then discussed, the objectives of the firm being the maximization of tax-free cash and assets on hand at the end of the planning period. Finally, the appropriate length of the planning horizon, and some approaches to capital budgeting under non-certainty, are discussed.     

Economic and social correlates of female employment and fertility

This study tested a theoretical model that views female employment and fertility decisions as jointly determined by biologic, sociologic, economic, and demographic factors that determine the circumstances of individual women, families, and the labor market. The data were drawn from a multistage stratified sample of 1926 married women of childbearing age in southern Philippines. The independent variables analyzed included the exogenous wage rates of both the wife and husband, the age of the wife, the number of children ever born per year of marriage, and residence (urban or rural). Also analyzed were the social variables of time conflict, normative conflict, work commitment, and wife's relative dominance in household decision making. An exogenous change in female wage rates increased the percent of time spent in paid employment but had an insignificant effect on fertility. In contrast, a change in the male wage rate reduce female employment and current fertility. Women in municipal poblacions had lower current fertility and significantly higher labor force participation than women in rural or urban settings. Women who perceived that children interfere with work were more likely to bear a child in the study period and less likely to participate in the labor force. The husband's attitude toward female employment reduced labor force participation, but did not increase current fertility. Finally, women who play a major role in household decision making had both increased labor force participation and increased fertility. There was some variation in these trends by age cohort. A positive coefficient of the female wage on fertility was observed among women 20-29 and 40-49 years, while a negative coefficient existed for women 30-39 years. It is concluded that a common set of economic and social factors jointly determine current female employment and fertility decisions.     

A quarterly forecast of the Russian economic macroindicators 2006–2008: A baseline scenario

On the one hand, this forecast of key macroindicators of the Russian economy is based on tendencies in the dynamics of these indicators; on the other, it accounts for the character of interrelations between economic variables reflected in the QUMMIR² model. The topical version of this model’s equations and identities, describing these interactions, and the names of the variables, are presented in a special detailed appendix to this article on the RIM³ (www.macroforecast.ru).     

A dynamic almost ideal demand system incorporating consumer expectations

In this paper a theoretical framework is presented for the analysis of the effects of psychological, perceptual or expectational factors on household expenditure within a complete demand system. The model was estimated using the Consumer Sentiment Index, which represents an index of consumer perceptions of economic conditions. Evidence was found for significant expectational effects on five of nine expenditure categories—food at home, alcohol, housing, durables and other services. The direct expectation effects were found to be small in size. The results demonstrate the model's potential usefulness as a framework for modelling consumer behavioral responses to expectations and for evaluating the welfare implications of policy-induced changes in expectations.     

On the Equivalence between the APV and the wacc Approach in a Growing Leveraged Firm

While in a steady state framework the choice between the wacc approach ( Modigliani‐Miller, 1963 ) and the adjusted present value (APV) approach ( Myers, 1974 ) is irrelevant since the two approaches provide the same result, however, in a growing firm context the wacc equation seems to be inconsistent with the APV result. In this paper we propose a simple model to evaluate the tax savings in a growing firm in order to show under which assumptions the two approaches lead to the same results. We demonstrate that the use of the wacc model in a steady‐growth scenario gives rise to some unusual assumptions with regard to the discount rates to be used in calculating tax shields. We show that the widely used wacc formula, if used, as it is in most cases, in a growth context, implies that a) debt tax shield related to already existing debt are discounted using k_d; b) debt tax shield related to new debt, due to company's growth, are discounted, according to a mixed procedure, using both k_u and k_d. We discuss the inconsistency of such a discounting procedure and the preferred features of the APV approach.     

Insiemi invarianti globalmente attrattivi nell'interazione fra il “mercato dei beni” ed il “mercato della moneta”

Si studia il comportamento dinamico locale e globale di un modello macroeconomico che si rappresenta con un sistema nonlineare di due equazioni alle differenze (sistema dinamico discreto, o mappa). Si mostra come l'uso di un nuovo strumento di analisi, le linee critiche, consenta di studiare molte delle proprietà globali (quali i bacini di attrazione di insiemi invarianti) e delle biforcazioni globali, che si verificano in mappe del piano con inversa non unica. Si prova che il punto fisso localmente attrattivo è anche globalmente attrattivo, mentre in regimi di instabilità del punto fisso esistono curve chiuse, o altri insiemi invarianti (regolari o caotici) di attrazione, in aree assorbenti globalmente attrattive.

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Summary The local and global dynamical behaviour of a macroeconomic model, represented by a nonlinear system of two difference equations (discrete dynamical system or map), is studied. It is shown how several properties (as basins of attraction of invariant sets) and global bifurcations occurring in two-dimensional maps with a non-unique inverse can be studied by use of a new analytical tool, the critical curves. It is proven that the locally attractive fixed point is globally attractive, while closed invariant curves or other attractive invariant sets (regular or chaotic) exist in globally attractive absorbing areas, when the fixed point is repulsive.