Congestion pricing of Canadian airports

Abstract Under congestion pricing, Canadian airports would annually save between $72 and $105 million. Social costs per landing and takeoff decrease about $300 at Toronto and Vancouver and $50 at Calgary and Montreal. Slot constraints fail to eliminate this airport congestion. Congestion prices are lower on average than existing weight‐based prices. Current airport capacity accommodates at least five more years of traffic growth before congestion reaches current levels. Substantial welfare gains occur even if dominant airlines already internalize their self‐imposed delays. This article calculates equilibrium congestion pricing schedules, traffic rates, queuing delays, layover times, and connection times by time of day.     

Economic and Monetary Union – Current Fiscal Disturbances and the Future

At the moment of its setting up the Economic and Monetary Union did not meet the criteria of the optimum currency area. Neither does it today. The crisis of public finance in the eurozone results from the abandonment public finance reforms, lack of consistency in enforcing the decision of the Stability and Growth Pact and, additionally, economic recession and financial crisis. Further functioning of the eurozone will depend on radical reforms of public finance and structural reforms enhancing efficiency of the market as an adjustment mechanism, and competitiveness of economies. The very establishment of the European Stabilization Mechanism and European Financial Stability cannot make up for the above mentioned necessary undertakings. It is important to change the socioeconomic model existing in the EU member countries.     

The efficiency of competitive mechanisms under private information

We consider the efficiency properties of exchange economies where privately informed traders behave strategically. Specifically, a competitive mechanism is any mapping of traders’ reports about their types to an equilibrium price vector and allocation of the reported economy. In our model, some traders may have non-vanishing impact on prices and allocations regardless of the size of the economy. Although truthful reporting by all traders cannot be achieved, we show that, given any desired level of approximation, there is such that any Bayesian-Nash equilibrium of any competitive mechanism of any private information economy with or more traders leads, with high probability, to prices and allocations that are close to a competitive equilibrium of the true economy. In particular, allocations are approximately efficient. A key assumption is that there is small probability that traders behave non-strategically.     

When do incentives work in channels of distribution?

The incentive dilemma refers to a situation in which incentives are offered but do not work as intended. The authors suggest that, in an interorganizational context, whether a principal-provided incentive works is a function of how it is evaluated by an agent: for its contribution to the agent’s bottom line (instrumental evaluation) and for the extent it is strategically aligned with the agent’s direction (congruence evaluation). To further understand when incentives work, the influence of two key contextual variables—industry volatility and dependence—are examined. A field study featuring 57 semi-structured depth interviews and 386 responses from twin surveys in the information technology and brewing industries provide data for hypothesis testing. When and whether incentives work is demonstrated by certain conditions under which the agent’s evaluation of an incentive has positive or negative effects on its compliance and active representation. Further, some outcomes are reversed in the high volatility condition.     

How Productive Is Workplace Health and Safety?

In this paper, we investigate the causal impact of workplace health and safety practices on firm performance, using Danish longitudinal matched employer–employee data merged with unique cross‐sectional representative firm survey data on work environment conditions. We estimate standard production functions, augmented with workplace environment indicators, addressing both time‐invariant and time‐varying potentially relevant unobservables in the production process. We find positive and large productivity effects of improved physical dimensions of the health and safety environment, specifically, “internal climate” and “monotonous repetitive work”.     

Scarcity and appropriative competition

This paper formalizes the commonsensical hypothesis that resource scarcity causes a large allocation of time and effort to appropriative competition. Our main innovation is to model explicitly the positive intertemporal effect of consumption on the probability of survival. The critical assumption is that this effect becomes stronger as resources become scarcer. We also show that anticipated future resource abundance increases the incremental value of survival and, consequently, amplifies the current allocation of time and effort to appropriative competition. Interestingly, if resources are currently scarce, then larger anticipated future abundance can cause a big enough increase in the time and effort allocated to appropriative competition to result in a decrease in the sum of current and expected future utility, a “paradox of anticipated abundance”.     

Augmenting the eye of the beholder: exploring the strategic potential of augmented reality to enhance online service experiences

Driven by the proliferation of augmented reality (AR) technologies, many firms are pursuing a strategy of service augmentation to enhance customers’ online service experiences. Drawing on situated cognition theory, the authors show that AR-based service augmentation enhances customer value perceptions by simultaneously providing simulated physical control and environmental embedding. The resulting authentic situated experience, manifested in a feeling of spatial presence, functions as a mediator and also predicts customer decision comfort. Furthermore, the effect of spatial presence on utilitarian value perceptions is greater for customers who are disposed toward verbal rather than visual information processing, and the positive effect on decision comfort is attenuated by customers’ privacy concerns.     

THE ROLE OF LABOR AND MARRIAGE MARKETS,PREFERENCE HETEROGENEITY,AND THE WELFARE SYSTEM IN THE LIFE CYCLE DECISIONS OF BLACK,HISPANIC, AND WHITE WOMEN*

Using data from the NLSY79, we structurally estimate a dynamic model of the life cycle decisions of young women. The women make sequential joint decisions about school attendance, work, marriage, fertility, and welfare participation. We use the model to perform counterfactual simulations designed to shed light on three questions: (1) How much of observed minority–majority differences in behavior can be attributed to differences in labor market opportunities, marriage market opportunities, and preference heterogeneity? (2) How does the welfare system interact with these factors to augment those differences? (3) How can new cohorts that grow up under the new welfare system (Temporary Aid for Needy Families) be expected to behave compared to older cohorts?     

An integrated tax-subsidy policy for carbon emission reduction

A carbon tax is often cited by economists as an effective instrument to mitigate greenhouse gas emissions, but there is little political interest in the United States. In light of this political unpopularity, we develop and examine a net-revenue constrained carbon tax and subsidy program. The optimal revenue constrained tax and subsidy schedule based on our utility maximization model taxes energy sources with high emissions to energy price ratio, and subsidizes sources with low emissions to energy price ratios. This approach may be more palatable than a traditional carbon tax because it can change the relative price of low and high emissions energy sources while providing a mechanism to limit net tax increases and energy price increases. We find that a constrained tax/subsidy program provides welfare gains relative to a no-tax scenario. Welfare gains are estimated to be 1% and 36% of the welfare gains from a Pigouvian tax for the motor fuels industry and electric power industry, respectively. In contrast, subsidies for low-emitting energy sources funded from general tax funds rather than from high-emission energy tax revenues lead to welfare decreases substantially below our proposed tax/subsidy policy approach.     

Country Differences in Material Deprivation in Europe

This paper assesses to what extent differences in the characteristics of individuals (micro‐level perspective) and country‐specific factors (macro‐level perspective) can explain country differences with respect to material deprivation levels. Thus, our work aims to simultaneously consider the macro dimension and the predominantly individually‐oriented study field of material deprivation using multilevel techniques. We make use of the European Union Statistics on Income and Living Conditions. Our results show that country‐specific factors seem to be much more relevant than individual effects in explaining country differences in material deprivation. We estimate that the introduction of country‐specific factors reduces the proportion of total variance due to between‐country differences in deprivation by 72.7 percent, while individual‐level variables reduce this proportion by only 9.4 percent. We also show, through interaction variables, that the effect of sociodemographic characteristics can be shaped by institutional and structural factors, especially by the level of GDP.