Modeling Overnight Recreation Trip Choice: Application of a Repeated Nested Multinomial Logit Model

In this paper we apply the repeated nested multinomial logit model, a version of a random utility model (RUM), to estimate the choice of an overnight versus single day recreation trip, along with the other usual choice of which of the sites to visit, and less typically, the choice of whether to participate (in our application – to fish) at all. We also find statistically significant income effects in the empirical results. The application is to Atlantic Salmon fishing and the data set is for Maine resident angler's fishing trips to rivers in Maine and Canada.     

Public Stackelberg Leadership in a Mixed Oligopoly with Foreign Firms

This is the first paper to consider a mixed oligopoly in which a public Stackelberg leader competes with both domestic and foreign private firms. The welfare maximising leader is shown to always produce less than under previous Cournot conjectures. Introducing leadership also alters previous public pricing rules resulting in prices that may be either greater than or less than marginal cost depending on the relative number of domestic firms. Furthermore, entry of a foreign firm will increase welfare only when the relative number of domestic firms is small, but that share is shown to be larger than has been indicated without leadership. Unlike previous models, the influence on public profit of a foreign acquisition is ambiguous and is related to the relative number of domestic firms. Finally, the consequences of privatisation are shown, for the first time, to depend on the relative number of domestic firms.     

Evaluating Projects and Assessing Sustainable Development in Imperfect Economies

We are interested in three related questions:(1) How should accounting prices be estimated?(2) How should we evaluate policy change in animperfect economy? (3) How can we check whetherintergenerational well-being will be sustainedalong a projected economic programme? We do notpresume that the economy is convex, nor do weassume that the government optimizes on behalfof its citizens. We show that the same set ofaccounting prices should be used both forpolicy evaluation and for assessing whether ornot intergenerational welfare along a giveneconomic path will be sustained. We also showthat a comprehensive measure of wealth,computed in terms of the accounting prices, canbe used as an index for problems (2) and (3)above. The remainder of the paper is concernedwith rules for estimating the accounting pricesof several specific environmental naturalresources, transacted in a few well knowneconomic institutions.     

Social Context,Management, and Organizational Performance: When human capital and social capital serve as substitutes

Do internal (administrative human capital) and external (social capital) resources work to reinforce the effects of each other? Work from multiple disciplines has approached this question, and we advance this literature with a theory of social and administrative resources as potential substitutes for each other in the production of public education outcomes. We argue that social capital benefits some groups more than others and that it interacts with management to improve performance. We therefore expect the benefits associated with social capital to be non-uniform across community groups. Using education as our area of study, we find that social capital offers the most direct and unconditional benefits to white students but that management can use human capital resources to compensate disadvantaged students who may lack support and resources outside of the classroom. We do not find support for the expectation that social capital and human administrative capital reinforce the benefits of each other, but we find evidence that the two resource types are substitutable. This implies that management may substitute human capital resources when social capital is low to benefit public program performance.     

What determines outstanding corporate debt mix? Evidence from fractional multinomial logit estimation

This study employs the fractional multinomial logit setting proposed by Papke and Wooldridge (1996) to examine factors driving the choice among nonbank private (144A) debt, bank loans and public debt made by 988 nonfinancial firms during 1993–2007. We document that the majority of firm-level factors have persistent effects on corporate outstanding debt mix across economic conditions. We also highlight the importance of macroeconomic variables on firms’ borrowing decisions as predicted by Diamond (1991). Finally, we document a substitution effect among debt financing sources due to credit rating downgrades, which is inconsistent with Rauh and Sufi (2010).     

Short-run fluctuations in fertility and mortality in pre-industrial Sweden

This paper describes and interprets annual Swedish data from 1750 to 1869 on weather, harvests, real wages, birth rates, and death rates using vector autogression. Impulses due to unexplained increases in wealth, whether this occurred through increased real wages, improved agricultural yields, or warmer winters, led in the short run to increased fertility and decreased infant and non-infant mortality, and hence to increased rates of population growth. Unexplained or unanticipated fluctuations in infant mortality led to replacement cycles in fertility within one to three years, although only a negligible cumulative effect on fertility persisted after five to ten years. Fluctuations in deaths among persons older than one year evoked a fertility response several years later, but this replacement response persisted after more than a decade. Although vector autoregression is not designed to account for long-term trends and their consequences, the interrelationships found here among exogenous weather shocks and fluctuations in economic conditions and demographic rates provide support for the homeostatic mechanisms hypothesized by classical economists and discussed by Malthus. The methodology of vector autoregression appears useful for studying historical series on climatic, economic and demographic variables where we do not yet have a sufficient theoretical foundation for specifying and estimating structural models.     

General purpose technologies in theory,application and controversy: a review

Distinguishing characteristics of General Purpose Technologies (GPTs) are identified and definitions discussed. Our definition includes multipurpose and single-purpose technologies, defining them according to their micro-technological characteristics, not their macro-economic effects. Identifying technologies as GPTs requires recognizing their evolutionary nature, and accepting possible uncertainties concerning marginal cases. Many of the existing ‘tests’ of whether particular technologies are GPTs are based on misunderstandings either of what GPT theory predicts or what such tests can establish. The development of formal GPT theories is outlined, showing that only the early theories predicted the inevitability of GPT-induced showdown and surges. More recent GPT theories, designed to model the characteristics of GPTs, do not imply the necessity of specific macro effects. We show that GPTs can rejuvenate the growth process without causing slowdowns or surges. We conclude that existing criticisms of GPT theory can be resolved and that the concept remains useful for economic theory.     

Seeking External Evidence to Assess Benefit Transfers for Environmental Policy

The cost and time required to produce original benefit estimates makes benefit transfers a highly valuable component of the process of assessing the benefits and costs of environmental improvements. Because of the great variety of benefit estimates, conducted at different times with different data sources and different techniques, there is concerted effort to understand the validity of transfers. The research in this paper approaches the validity issue of benefit transfers by asking whether there is indirect evidence of the benefits. The premise of the paper is that policies that give significant benefits should induce expected and unexpected behavioral changes. We look for evidence of potential indirect evidence by by estimating the effect of differences air pollutants on activities such as outdoor recreation and work, as found in the American Time Use Survey.