The economic costs of biological predation

This paper developes a bioeconomic model to analyse the economic losses from the reduced harvesting of prey species resulting from an increase in the stock of a natural predator. Examples of large mammals creating economic damage are whales and African elephants. The economic losses depend critically on the actual management of the prey stock, although the three measures we develop are equal when the stock is managed so as to maximize the sustained economic rent from the prey species. Predation losses are illustrated by the case of the Northeastern Atlantic Minke whale, where the estimate of the average predation cost per whale in 1991–1992 is between $US 1780 and $US 2370, using Norwegian cost and earnings data. A ten percent stock increase is estimated to cause a loss of almost $US 19 million to the fishers of the prey species. If half of this cost were assigned to Norway it would be equivalent to 2.8 and 6.7 percent of the gross profits of the Norwegian cod and herring fisheries, respectively.     

Processes and patterns in transitions and system innovations: Refining the co-evolutionary multi-level perspective

This article investigates transitions at the level of societal functions (e.g., transport, communication, housing). Societal functions are fulfilled by sociotechnical systems, which consist of a cluster of aligned elements, e.g., artifacts, knowledge, markets, regulation, cultural meaning, infrastructure, maintenance networks and supply networks. Transitions are conceptualised as system innovations, i.e., a change from one sociotechnical system to another. The article describes a co-evolutionary multi-level perspective to understand how system innovations come about through the interplay between technology and society. The article makes a new step as it further refines the multi-level perspective by distinguishing characteristic patterns: (a) two transition routes, (b) fit–stretch pattern, and (c) patterns in breakthrough.     

Extraction of an Exhaustible Resource: The Effects on Investment of Several Parameters Being Subject to Uncertainty*

This article shows that the effect on investment of the introduction of uncertainty about the size of one parameter depends on what other parameters are simultaneously uncertain. Further, two parameters may be linked with positive or negative covariances. The covariances are here shown to have important effects on the investor, whether risk neutral or risk averse. Governments are advked to consider policies that affect the covariances of those parameters that are key influences on in vestment.     

The international potential of traditional resource systems in marginal areas

Marginal areas of the world, including tropical highlands, tropical coastal zones, and arid lands, are problematical for development. They are ecologically special areas, often of vital consequence to the stability of more populated regions nearby. Commonly, their peoples are culturally distinct. To develop marginal areas it is suggested that “transformational” development may be appropriate. Transformational development recognizes the importance of equity and of working with existing resource systems already ecologically and culturally appropriate to the area. In marginal areas, a special application of transformational development could include incremental changes in existing systems and their connection to modern international systems so as to benefit the inhabitants of marginal areas and to supply commodities and goods demanded in the rest of the world. By rethinking ideas about resources, an exploratory framework for such transformation is examined. This framework uses the concept of “resource system”, a concept which might play an important part in the application of equitable future global development efforts.     

Joint outputs and real wage rates

The magnification effect in standard international trade theory asserts that if the relative price of the labor-intensive commodity increases, the real wage will also increase, as will the wage/rental ratio. This result depends upon the assumption that both activities are nonjoint—each combining labor and capital to produce a single output, so that if activities are joint instead, the results are in jeopardy. It is shown that if the difference between the share of commodity one produced in the first activity and in the second activity exceeds the difference between the labor distributive shares in the first activity and the second, an increase in commodity 1's relative price raises the wage/rental ratio. The real wage unambiguously rises in this case if and only if the ratio of the commodity output shares in the two activities exceeds the ratio of labor shares.     

Forecasting first births

This study is concerned with one aspect of the family cycle, namely, the transition from young married to young married with small children. The focus is on developing models to forecast entries into this latter stage for the purpose of marketing research. "Using ordinary least squares, forecasting models were estimated for (1) total number of first births, (2) number of white first births, and (3) number of nonwhite first births." Models are estimated for both the United States and California using data from official sources.     

Low information nash equilibria for oligopolistic markets

This paper deals with an infinite horizon n firm oligopoly in which firms are assumed to have incomplete information about one another's actions and profit functions. An equilibrium concept is defined that is similar to the Nash non-cooperative equilibrium, but is suitable for the information assumptions of the model. The equilibrium uses a type of bounded rationality which makes firms' computations relatively easy. This is due to an implicit assumption that computation is costly and a Bayesian approach is prohibitively costly. This low information Nash equilibrium is proved to exist, and, in addition, an adaptive expectations decision process is described which, if followed by all firms, leads to the low information Nash equilibrium.     

Friedman's Money Supply Rule vs. Optimal Interest Rate Policy

Using New Keynesian models, we compare Friedman's k‐percent money supply rule to optimal interest rate setting, with respect to determinacy, stability under learning and optimality. First we review the recent literature: open‐loop interest rate rules are subject to indeterminacy and instability problems, but a properly chosen expectations‐based rule yields determinacy and stability under learning, and implements optimal policy. We show that Friedman's rule also can generate equilibria that are determinate and stable under learning. However, computing the mean quadratic welfare loss, we find for calibrated models that Friedman's rule performs poorly when compared to the optimal interest rate rule.