Flood Hazards and Urban Housing Markets: The Effects of Katrina on New Orleans

This study examines the impacts on consumers’ willingness to pay for certain characteristics of housing in greater New Orleans before and after the flooding of Hurricane Katrina. Single-family home sales from January 2004 to August 2006 are collected and used in a hedonic price function to estimate the changes in the value of amenities, and structural, neighborhood and geographic characteristics, including the mean elevation of each property. Elevation, which buyers did not know for certain prior to the storm, but may now be inferred from water level marks in most neighborhoods, is found to have a positive relationship with selling prices. Results indicate that pre-Katrina, there was a premium of only 1.4% per foot in flood-prone areas, and was insignificant in areas not subject to flooding. This increased to 4.6% for flooded areas after Katrina. These findings are attributed to not only the perceived risk of flooding, but also to the potential of higher compliance costs associated with rebuilding under more stringent National Flood Insurance Program (NFIP) guidelines.     

Student imaginings,cognitive dissonance and critical thinking

In this paper, we urge accounting educators to encourage imaginings and critical thinking in students. We reflect on the results of an assignment in which French accounting students were encouraged to assess the collapse of Enron. The submitted assignments attest to the originality and richness of non-conformist stories reported by some students. However, they also revealed strong instances of cognitive dissonance that we contend was fostered by the contradictions some students detected between the rhetoric and the reality of capitalism; and by the perpetuation of socially bereft capitalist values in accounting curricula. The assignment manifested student discontent with the current pervading economic system and its moral and ethical precepts. We identify the ways by which students responded to their cognitive dissonance. We propose some pedagogic and curriculum initiatives to improve accounting education. These initiatives call for stronger efforts to connect accounting topics with the social world in order to demystify the alleged naturalness of the capitalist system; for students to be encouraged to imagine other cultures and discourses; and for students to challenge any prevailing ideology.     

Anonymity in Computer-Mediated Communication: More Contrarian Ideas with Less Influence

Anonymity is thought to be an important means for ensuring a free exchange of ideas by encouraging the expression of minority viewpoints. However, we suggest that anonymity’s reduction in awareness of others potentially affects the expression and interpretation of comments that are made during a discussion. In particular, anonymity will increase the likelihood that comments will be made that are contrary to the majority opinion while at the same time decreasing the effect that those contrary arguments have on other group member’s opinions. This paper reports experimental results showing that anonymity led to more overall participation in discussions of ethical scenarios. However, equality of member participation did not differ between anonymous and member-identified groups, and anonymous groups had significantly higher awareness-related comments. This leads to the conclusion that additional participation in anonymous groups accommodates reduced awareness rather than reflecting the increased participation of normally reticent group members. In addition, anonymity led to more arguments in support of questionable behavior, suggesting that the freeing effects of anonymity apply to the social desirability of arguments. Finally, there was less change in opinion under conditions of anonymity than when comments were identified, suggesting that anonymous arguments have less influence on opinions than identified comments.     

Processing and Retrieval of Inferences and Descriptive Advertising Information: The Effects of Message Elaboration

Abstract

Two issues make advertising effectiveness difficult to assess: (1) advertising effects occur both during ad processing and when ad information is retrieved, and (2) the information that consumers derive from advertisements is likely to be some combination of explicit information and inferences. The study reported in this paper addresses these issues, examining the effects of encoding and time delay on advertising processing. Results indicate that while some types of inferences (product features) are more likely to be made under strong than weak encoding conditions, other types of inferences (consumption situation) are not affected by encoding. In addition, at the time of a decision (after a time delay), memory information use depends both upon individual brand accessibility and the relative accessibility of alternative brands in the memory set. Implications for both advertising researchers and managers are offered.     

Testing the validity of responses to contingent valuation questioning

One way of assessing the validity of results generated through the application of the Contingent Valuation Method (CVM) is through the analysis of response sensitivity to factors expected to have an influence. Scope testing involves presenting at least two alternative impact scenarios to population sub-samples and testing for differences between the estimates generated. Most applications of the CVM in Australia have not involved scope testing and those that have yielded mixed results. These studies are reviewed. The results of scope sensitivity and other validity tests are presented for a study aimed at estimating the value of environmental damage caused by dryland salinity in the Upper South East of South Australia.     

Diagrammatic Approach to Capacity-Constrained Price Discrimination

This paper presents a diagrammatic solution to the firm's profit-maximizing price discrimination problem in the face of capacity constraints. Airlines, hotels, and other firms practice yield management, allocating fixed capacity to customer groups paying different prices. In these cases, the firm's short-run problem is not a decision about production levels, but it is one of allocating a fixed number of output units among customers. Our diagram shows that the conditions for profit-maximizing price discrimination are very different under these circumstances than in the standard model in which the firm is not constrained by capacity.     

The "Sect Effect" in Charitable Giving: Distinctive Realities of Exclusively Religious Charitable Givers

A bstract .   An examination of the charitable giving behavior of 16,442 households reveals intriguing patterns consistent with the club-theoretic approach to religious sect affiliation. The club-theoretic model suggests that individuals with lower socioeconomic standing will rationally be more likely to align themselves with exclusivistic sects. Because sect affiliation is also associated with more obligatory religious contributions, this approach generates novel predictions not anticipated by standard economic models of charitable behavior. Traditional analysis of charitable giving can mask the "sect effect" phenomenon, as low-income giving is dwarfed by the giving of the wealthy. However, the application of a two-stage econometric model—separating the participation decision from the subsequent decision regarding the level of gifting—provides unique insights. Basic socioeconomic factors have significant and opposite associations with different categories of giving, calling into question the treatment of charitable giving as a homogenous activity and supporting the understanding of sect affiliation, and potentially religious extremism, as rational choice phenomena.     

Share contracts and macroeconomic externalities

Weitzman's analysis of the share economy contrasts fixed-wage and fixed-share contracts; this paper notes that neither is an optimal labor contract, rendering the comparison suspect. Given this comparison, though, share contracts may be superior to wage contracts in an economy characterized by a “macroeconomic externality,” whereby firm-level employment decisions affect the demand for other firms' goods.