Effects of income and social awareness on consumer WTP for social product attributes

Recent developments in environmental and animal welfare issues, and the introduction of new production practices may have affected consumer attitudes and preferences toward differentiated product choice. Factors such as animal well-being, environmentally friendly production, and the use of antibiotics appear to be increasingly core consumer concerns. We link the aforementioned with Maslow's hierarchy of needs suggesting that the higher income consumers should be more altruistic in their consumptive behavior and test this by evaluating consumer preferences for these attributes in pork chops. We also test whether social consciousness of the consumers translates into choice behavior. Data was obtained by choice experiment surveys and mixed logit estimation was used to estimate consumers' willingness-to-pay for the credence attributes. Results reveal that both, higher income and socially aware consumers are on average willing to pay higher premiums for the antibiotic-free attribute, but not for other two social attributes. Also, the group of higher income consumers is highly heterogeneous in their preferences, whereas socially aware consumers tend to be more homogeneous in their preferences.     

A survey-based choice experiment on coca cultivation

From 1997 to 2005, an astonishing 5200 million USD was invested to reduce cocaine production in Colombia, the world's main cocaine producer. However, little is known about the effectiveness of policies targeting coca cultivation. This paper uses a survey-based experiment to evaluate the effects of the two main policies: eradication and alternative development programs. Our results support Becker's (1968) model of crime participation and in addition shed light on other non-monetary factors that affect the coca cultivation decision: religion, legitimacy, remoteness, and poverty are found to be important. We find that coca cultivation is inelastic to increases in perceived risk and relative profit so eradication and alternative development would have a rather small effect on coca cultivation. A simple simulation exercise predicts that investing additional hundred thousand dollars in eradication decreases coca cultivation in only 1.5%.     

Dealing with Ignored Attributes in Choice Experiments on Valuation of Sweden’s Environmental Quality Objectives

Using a choice experiment, this paper investigates how Swedish citizens value three environmental quality objectives. In addition, a follow-up question is used to investigate whether respondents ignored any attributes when responding. The resulting information is used in model estimation by restricting the individual parameters for the ignored attributes to zero. When taking the shares of respondents who took both the environmental and the cost attributes (52–69% of the respondents) into account, then the WTP for each attribute changes if the respondents who ignored the attributes have a zero WTP. At the same time, we find evidence that not all respondents who claimed to have ignored an attribute really did. However, the most commonly ignored non-monetary attributes always have the lowest rankings in terms of WTP across all three environmental objectives. Thus, our results show that instead of ignoring attributes completely, respondents seem to put less weight on the attributes they claimed to have ignored.     

Product diversification and stability of employment and sales: first evidence from German manufacturing firms

In this study, we use a unique rich newly built data set for German manufacturing enterprises to investigate the relationship between product diversification and the stability of sales and employment. We find that contrary to portfolio theoretic considerations, more diversified firms exhibit a higher variability of sales and employment. However, the effects are negligibly small from an economics point of view.     

Democratic revolutions as institutional innovation diffusion: Rapid adoption and survival of democracy

Recent ‘democratic revolutions’ in Islamic countries call for a re-consideration of transitions to and from democracy. Transitions to democracy have often been considered the outcome of socio-economic modernization and therefore slow and incremental processes. But as a recent study has made clear, in the last century, transitions to democracy have mainly occurred through rapid leaps rather than slow and incremental steps. Here, we therefore apply an innovation and systems perspective and consider transitions to democracy as processes of institutional, and therefore systemic, innovation adoption. We show that transitions to democracy starting before 1900 lasted for an average of 50 years and a median of 56 years, while transitions originating later took an average of 4.6 years and a median of 1.7 years. However, our results indicate that the survival time of democratic regimes is longer in cases where the transition periods have also been longer, suggesting that patience paid in previous democratizations. We identify a critical ‘consolidation-preparing’ transition period of 12 years. Our results also show that in cases where the transitions have not been made directly from autocracy to democracy, there are no main institutional paths towards democracy. Instead, democracy seems reachable from a variety of directions. This is in line with the analogy of diffusion of innovations at the nation systems level, for which assumptions are that potential adopter systems may vary in susceptibility over time. The adoption of the institutions of democracy therefore corresponds to the adoption of a new political communications standard for a nation, in this case the innovation of involving in principle all adult citizens on an equal basis.     

Coevolutionary cycles of convergence: An extrapolation from the ICT industry

Convergence between technologies can be regarded as an increasingly emerging trend, and has received particular attention in the coming-together of previously distinct products and solutions within the information and communication technologies (ICT) industry. In previous research, the overall impact of the convergence phenomenon remains ambiguous. Whereas some scholars suggest convergence to be associated with disintegration, entry and growth, others relate the phenomenon to opposite effects, such as consolidation and shakeouts. This inconsistency in managerial conceptions on convergence formulates a need for an integrated understanding. Within a multi-case study approach, the convergence within ICT has been observed through examining the coevolution of actors in a converging environment, and patterns in innovation dynamics and managerial responses have been identified. In reflection with existing models of innovation cycles, a model for convergence innovation processes is elaborated and discussed. In particular, the reasoning within the ICT case set is transferred onto the currently emerging entrepreneurial activities in the intersection between nano- and bio-technologies (NBT), resulting in a comparison between ICT and NBT convergences, and deriving recommendations from a retrospective to a predictive context.     

Adverse selection and bilateral asymmetric information

A simple principal-agent model with bilateral asymmetric information and common values is developed. The agent(s) has private information about his characteristics but does not knowhow these affect outcomes. The principal knows how the characteristics translate into outcomes, but does not observe the characteristics. It is shown that equilibrium contracts aresimple in being designednot to reveal the agent's characteristics. When the agent knows howsome of his characteristics affect the outcome, contracts will be differentiated with respect to precisely those characteristics. An application to the use of genetic information is considered.     

UNDERSTANDING PER‐CAPITA INCOME GROWTH IN PREINDUSTRIAL EUROPE

In a Malthusian environment, per‐capita incomes are stagnant, meaning they cannot exhibit sustained growth. However, they can still display volatility and persistence when hit by shocks. This article simulates a Malthusian model with realistic life‐cycle structure and stochastic and accelerating growth in land productivity. We find that differences across simulated economies are quantitatively similar to those found in recently compiled data over GDP per capita for several European countries before 1800. This speaks to the relevance of the Malthusian model for understanding preindustrial development in Europe, contrasting with contentions to the contrary in some of the existing literature.     

The economics of the Syrian refugee crisis in neighbouring countries: The case of Lebanon

In this article, we investigate the effects of a massive displacement of workers from a war‐torn economy on the economy of a neighbouring country. Applying a general equilibrium approach to the Lebanese economy, we explore effects from various components of the crisis on the labour market, the production apparatus and macroeconomic indicators. Along with previous literature, our findings suggest limited or no adverse effects on high‐skilled native workers, but a negative impact on the most vulnerable Lebanese workers. When aid takes the form of investment subsidies, significantly better growth and labour market prospects arise, recalling the necessity of complementing humanitarian aid with development aid to succeed in achieving long‐term objectives. This may however not be politically viable in a context where refugees are considered as temporary.