Pareto optima and equilibria when preferences are incompletely known

An exchange economy in which agents have convex incomplete preferences defined by families of concave utility functions is considered. Sufficient conditions for the set of efficient allocations and equilibria to coincide with the set of efficient allocations and equilibria that result when each agent has a utility in her family are provided. Welfare theorems in an incomplete preferences framework therefore hold under these conditions and efficient allocations and equilibria are characterized by first order conditions.     

On the transaction values of land use rights in rural China

Land Use Rights (LURs) in China affect farmers’ productivity through investment incentives and the way land is allocated across households. LURs have implication and trade-offs between equity and growth. This paper examines how Chinese farmers might respond if the Chinese government made it legal for farmers to buy or sell LURs. Livelihood choices, labor substitution, market infrastructure, a lack of property right protections, entrepreneurship, bureaucracy, and political will are all influential factors that will determine whether such a program would work. The purpose of this paper is to examine the economics of transaction in LURs, estimate the value at which LURs could transact in equilibrium, and to analyze factors that would affect these price changes. We evaluate farmer’s intention to buy and sell LURs and how much they are willing to pay and receive for LURs.     

Science and Corporate Strategy: A Bibliometric Update of Hounshell and Smith

Hounshell and Smith's Science and Corporate Strategy: DuPont R&D, 1902- 1980 is one of the most comprehensive business history books ever written. In addition, it highlights the important relationship between corporate strategy and R&D activities. The purpose of this current paper is to update the information on DuPont's R&D activities using secondary data and bibliometrics. Our findings are that DuPont underwent a series of dramatic shifts in their R&D efforts during the 1980s and into the 1990s. For example, there was a focus on life sciences, a concerted attempt to reduce R&D, and an endeavour to align R&D more with core businesses. Beyond the bibliometrics, we found that corporate performance and changes in the top management team may have precipitated these changes in R&D. The implications of such relationships are also discussed.     

Keynes and Sraffa's 'Difficulties with J. H. Hollander'

The paper reports on Jacob H. Hollander's cooperation with John Maynard Keynes and Piero Sraffa in the preparation of the latter's edition of The Works and Correspondence of David Ricardo. The report is based on archive material from various sources, including the unpublished papers of Edwin Cannan, Piero Sraffa, Jacob H. Hollander, John Maynard Keynes, and Jacob Viner, and the archive of the Royal Economic Society. The archive material consulted by us shows that, put mildly, Jacob H. Hollander did not promote Sraffa's editorial project: he held back material which he had received from Frank Ricardo and did not disclose to Sraffa that he owned several important letters which he had privately purchased. Moreover, Sraffa was refused access to Ricardiana even after he had traced them down in laborious detective work to be in Hollander's possession. Hollander's unwillingness to cooperate with Sraffa considerably delayed the publication of the Ricardo edition.     

Bounded rationality,expectations, and child labour

This paper develops a model with overlapping generations, where the household's optimal fertility, child labour, and education decisions depend on the parents’ expectations or beliefs about the return to education. It is shown that there exists a range of parental income where the fertility rate is high and children participate in the labour market and receive an incomplete education if a parent believes the return to education is low. The act of participating in the labour market reduces the child's ability to accumulate human capital; thus, the action of sending a child into the labour market is sufficient to ensure that the parents’ initially pessimistic expectations are fulfilled. It is then shown that a one‐time policy intervention, such as banning child labour and mandatory education, can be enough to move a country from the positive child labour equilibrium to an equilibrium with no child labour.     

The Postal Sector as a Vector of Financial Inclusion

Access to finance has become a major policy issue under the term Financial Inclusion. In this paper, we focus on the role of postal operators in financial inclusion policies. In developing countries, postal firms typically manage a dense network of counters with a unique coverage of rural areas where the banking sector is totally absent. We use a formal location model for postal counters and bank agencies to show that in rural areas a post‐bank partnership can be a vector of financial inclusion and that this can be done profitably.     

TROUGH TO PEAK: A NOTE ON RISK‐TAKING IN THE PACIFIC NORTHWEST'S BANKING SECTOR, 2001–2007

Using a cohort of 157 Federal Deposit Insurance Corporation insured banks based in the Pacific Northwest, this paper examines regional bank risk‐taking over the 2001–2007 economic expansion. The focus is on on‐balance sheet assets that carry a 100% risk weighting in the calculation of regulatory capital ratios. This study finds that Pacific Northwest banks significantly increased their share of 100% risk‐weighted assets between 2001 and 2007, largely through commercial real estate lending. Asset size, market concentration, age, metropolitan statistical area‐location, and balance sheet capacity for risk‐taking are statistically significant predictors of the change in the share of 100% risk‐weighted assets over the period of interest. (JEL G21, R11)     

THE IMPACT OF HIV EDUCATION ON BEHAVIOR AMONG YOUTHS: A PROPENSITY SCORE MATCHING APPROACH

There has been a long‐standing debate as to whether sex or human immunodeficiency virus (HIV) education actually influences the way young people behave. To the extent these programs work, they represent a potential mechanism policy‐makers might use to reduce risky behavior among youths. This paper uses data from the 2009 Youth Risk Behavior Survey to examine if students who have received school‐based HIV instruction behave differently than those who have not. To address potentially endogenous exposure to HIV education, this paper considers a propensity score matching approach. Findings from the propensity score analysis suggest that standard ordinary least squares results are biased. Despite this, there remains some evidence that exposure to HIV education decreases risky sexual activity. Among male students, HIV education is also negatively related to the rate of using needles to inject illegal drugs into the body. The needle use results are robust to a sensitivity analysis, while the results for sexual behaviors are not. (JEL H75, I18, I28, K32)