Consequences of further opening of the Korean dairy market

This paper develops a simulation of Korean dairy policy that is tailored to the data, institutions, and policies in South Korea. It compares potential effects of changes in trade and domestic policy to baseline projections to 2015. Beverage milk continues to be supplied from domestic sources, implying imports compete in the manufacture of tradable products. We model manufactured dairy product supply, demand, and trade on a milk fat and non-fat-solid component basis reflecting product fungibility over the 10-year horizon used for our trade policy analysis. We find that if the domestic price support is removed with no change in trade policy, the market price of raw milk falls by about 2% and raw milk production declines by 4.5%. Under substantial tariff cuts of 30–40% with no effective change in domestic dairy policy, Korean fat and non-fat-solid prices fall by 7% and 11%, fat and non-fat-solid imports rise by 9% and 7% and Korea raw milk production falls by about 2% relative to the baseline. Prices of Korean farmer-owned dairy inputs, labor, and capital fall by about 1%.     

Hired hooves: Transactions in a south Indian village factor market

Bullocks are an important resource in Indian agriculture where they are used as draft animals. Previous research suggests that farmers who do not own bullocks, or own bullocks in insufficient numbers relative to their land holdings, adjust bullock-land ratios through transactions in the land market, rather than by hiring bullock services. The reasons given for this behaviour are that there are 'inhibited' or 'missing' village markets for bullock services. Results from a survey of the activities and transactions of six bullock contractors during an entire cropping period show that village markets for bullock services exist continuously and are far from being inhibited. Close monitoring of the bullock contractors' transactions supplied rich evidence of the manifold contractual arrangements used in this village market for bullock services.     

Hospital Technology in a Nonmarket Health Care System

This article presents a quantitative analysis of the production of hospital services in a nonmarket environment based on production theory and a very complete data set on the hospital industry. It provides both insights into the optimality of the hospital industry structure and a useful framework to evaluate the impact of anticipated industry structural changes. We find that the industry structure is far from optimal; it is characterized by overcapitalization and would experience difficulty responding to increased demand for some types of services.     

The Effects of Competition on Variation in the Quality and Cost of Medical Care

We estimate the effects of hospital competition on the level of and the variation in quality of care and hospital expenditures for elderly Medicare beneficiaries with heart attack. We compare competition's effects on more-severely ill patients, whom we assume value quality more highly, to the effects on less-severely ill, low-valuation patients. We find that low-valuation patients in competitive markets receive less intensive treatment than in uncompetitive markets, but have statistically similar health outcomes. In contrast, high-valuation patients in competitive markets receive more intensive treatment than in uncompetitive markets, and have significantly better health outcomes. Because this competition-induced increase in variation in expenditures is, on net, expenditure-decreasing and outcome-beneficial, we conclude that it is welfare-enhancing. These findings are inconsistent with conventional models of vertical differentiation, although they can be accommodated by more recent models.     

The signs of the co-state variables and sufficiency conditions in a class of optimal control problems

A class of optimal control problems is identified, for which co-state variables have definite signs and the Maximum Principle is sufficient for optimality. The restrictions defining this class of problems are given an economic interpretation.     

Focus Groups and the Development of New Products by Technologically Driven Companies: A Comment

Market research information often helps to reduce uncertainty in many new product decisions. Yet, each research technique has both strengths and weaknesses in terms of its ability to aid decision makers. Daniel Seymour responds to a recent Journal of Product Innovation Management article in which the benefits of focus group research were examined. By enumerating and describing the major limitations of the technique, a more informed choice of research approaches may be embraced.     

Gottfried Haberler's 1930 Reformulation of Comparative Advantage in Retrospect

In 1930 Gottfried Haberler freed the doctrine of comparative advantage from its association with David Ricardo's labor theory of value and provided us with its modern opportunity‐cost formulation. Haberler's reformulation of comparative advantage revolutionized the theory of international trade and laid the conceptual foundation of modern trade theory. On the occasion of its 75th anniversary, a symposium has been organized to reflect on and celebrate one of the most durable and fruitful ideas in the history of economic thought. In this introductory paper I revisit Haberler's original formulation, which was published in German in the Weltwirtschaftliches Archiv.