The industrial demand for energy

This paper uses a constant elasticity of substitution production function to examine the extent of factor substitutability in the production of industrial goods. Subsequently, the degree of interfuel substitution is estimated and it is demonstrated that all energy sources are substitutable. Finally, the stability of the demand for various energy sources is empirically tested for and it is concluded that over the period of investigation the demand has in fact remained unaltered.     

A dynamic demand analysis for electrical energy by class of consumer

Conclusion In the preceding discussion, the price responsiveness of consumers has been estimated. The results not only indicate consumer reaction to changes in price is significant, but also they should completely dispel any argument over the efficacy of the market mechanism to restore equilibrium between supply and demand. Note, however, that demand is relatively inelastic, implying that a large change in price is needed to induce a sufficient change in the quantity demanded for the restoration of equilibrium. If the problem is to curtail the sales of electricial energy, the solution is obvious. The author would like to thank Joseph R. Antos and J. Wilson Mixon of the Bureau of Labor Statistics for helpful comments. The views expressed are those of the author and do not reflect the policies of the Bureau of Labor Statistics or the views of other BLS staff members.     

A note on spatial and temporal price and allocation modeling: Quadratic programming or linear complementary programming?

This paper presents a clarification of the specific conditions under which the linear complementary programming (LCP) formulation, instead of the quadratic programming (QP) formulation, is applicable in such areas as spatial and temporal price and allocation modeling. An important condition for the use of the LCP formulation is that the coefficient matrix of the demand and/or supply functions is asymmetric. Dynamic formulations can be treated as a LCP but it is demonstrated that the problem can be reformulated in a standard QP format.     

Price discrimination in the exports of a small economy: Empirical evidence

Zusammenfassung Preisdiskriminierung durch Exporteure kleiner L?nder: Ein empirischer Befund. — Theoretische Modelle des internationalen Handels gehen im allgemeinen von der Annahme aus, da\ die Exporteure kleiner L?nder einer voll-kommen elastischen Nachfrage nach ihren Exportgütern gegenüberstehen und da\ sie nicht die Macht haben, Preisdiskriminierung zu betreiben. Die Studie prüft auf der Grundlage israelischer Daten empirisch, ob diese zwei Annahmen berechtigt sind. Die Ergebnisse zeigen, da\ die israelischen Exporteure abw?rts geneigten Nachfrage-kurven gegenüberstehen und da\ sie in der H?lfte der überprüften F?lle Preis-diskriminierung praktizieren. Dieser Befund zweifelt also die Annahme des kleinen Landes und das Gesetz eines einzigen Preises an.

---

Résumé La discrimination par des prix dans les exportations d’une économie petite: L’évidence empirique. — Les modèles théoriques du commerce international généralement supposent que les économies petites sont confrontées avec des courbes de demande parfaitement élastiques pour leurs biens exportés et qu’elles n’ont pas le pouvoir de pratiquer une discrimination par des prix. Cette étude teste, empirique-ment, la validité de ces deux suppositions pour les exportations d’une économie petite. Basés sur les données israéliennes les résultats indiquent que les exportateurs israéliens sont confrontés avec des courbes de demande orientées vers le bas et qu’ils pratiquent une discrimination en moitié des cas testés. Ces résultats mettent en doute la validité de la supposition d’une économie petite et le loi d’un seul prix.

---

Resumen Discriminación de precios en las exportaciones de una economía peque?a: Empírica evidencia. — Modelos teóricos del comercio internacional suponen en general que las economías peque?as confrontan curvas de demanda perfectamente elásticas para sus productos de exportatión y no pueden enforzar una discriminación de precios. El estudio comprueba, empíricamente, la validez de estas dos hipótesis para las exportaciones de una economía peque?a. Basados en estadísticas de Israel, los resultados indican que los exportadores de este país confrontan curvas de demanda con pendiente negativa y practican discrimination de precios en la mitad de los casos estudiados. Estas resultados ponen en entredicho la validez de emplear la hipótesis de una economia peque?a y la ley de un solo precio en estudios analíticos.

     

Modeling oil refinery operations

This paper develops a model to analyze the relative responsiveness of refined petroleum product output to changes in the relative prices of these products. A scheme is devised and implemented that shares out total production into motor gasoline, distillate fuel oil, kerojet fuel, and other refined products. A multinomial logit specification is used whereby the share of each of these products is a function of relative prices, a seasonal factor, and the relative amount of crude output to total product output. Finally, the structural stability of the estimated relationships are tested for and the null hypothesis of stability is not rejected.     

Banks,bankruptcy, and public regulation

In a simple state-preference model with a complete capital market, some surprising implications of equilibrium in the banking industry are derived. For example, to limit a bank's probability of bankruptcy, it is sufficient for public regulators to control the composition and relative size of its portfolio or marketable securities. Generally, its loans need not be restricted. Also, under most publicly subsidized deposit insurance, bankers select very risky portfolios of bonds and loans with or without any risk adjustment in the insurance premium. In fact, with many types of subsidized insurance, public monitoring of bank loans is essential.     

The stability of the demand for fossil fuels by electric utilities

The view that the regional demand for fossil fuels by electric utilities in the United States is characterized by stable relationships is subjected to an objective statistical test. The test utilizes a statistic which equals the ratio of the sum of squared residuals of one period prediction from the k + 1 period to the rth period to the sum of squared residuals of one period prediction from the k + 1 to the Tth period, where k is the number of estimated coefficients in the model and T is the sample size. The results suggest for the period 1973 through 1978, that the fossil fuel demand functions in Region II and Region VIII and the coal demand function in Region X became unstable around 1977. For the other regions, the results indicate no appreciable (statistically significant) change in the relative importance of the underlying determinants of the demand for fossil fuels.     

Incentives for creativity

We investigate whether piece-rate and competitive incentives affect creativity, and if so, how the incentive effect depends on the form of the incentives. We find that while both piece-rate and competitive incentives lead to greater effort relative to a base-line with no incentives, neither type of incentives improve creativity relative to the base-line. More interestingly, we find that competitive incentives are in fact counter-productive in that they reduce creativity relative to base-line condition. In line with previous literature, we find that competitive conditions affect men and women differently: whereas women perform worse under competition than the base-line condition, men do not.     

A SIMULTANEOUS EQUATIONS APPROACH TO MODELING INDUSTRY STRUCTURE AND ECONOMIC PERFORMANCE

This paper presents a simultaneous equations model of profitability, concentration, advertising expenditures, and research and developed outiays. The data are subjected to regression diagnostics in an effort to ascertain the importance to the estimation of a subset of the data than can have a disproportional influence. The estimation results, especially for the advertising expenditures relationship and the research and development outlays equation, do change when a truncated data sample (based on the omission of the outliers) is used. This serves as a partial explanation of why there is disagreement in the literature on market structure and economic performance.