Capital-skill complementarity,productivity and wages: Evidence from plant-level data for a developing country

Different types of labor and capital inputs have varying productive contributions that are dependent on plant characteristics. We estimate such contributions and their underlying determinants, recognizing the interactions among labor and capital components that reflect their substitutability or complementarity, for Turkish manufacturing plants. We distinguish technical and non-technical labor, and structures, machinery and computer capital, as well as the shares of female workers and imported capital in our production function specification. We find capital-skill complementary for both machinery and computers; greater productive contributions and thus wages for skilled labor are associated with more machinery intensity and computer use. The reverse is true for unskilled labor, which is complementary only with capital structures. Our results suggest that synergies among skilled (technical) labor, computers, and machinery capital have productivity- and skilled wage-enhancing effects that could contribute to productivity convergence of developing toward developed countries, even with their differing industry and input composition.     

Multi-Output, Nonfrontier Primal Measures of Capacity and Capacity Utilization

This article implements an econometric approach for generating primal capacity output and utilization measures for fisheries. In situations where regulatory, environmental, and resource conditions affect catch levels but are not independently identified in the data, frontier-based capacity models may interpret such impacts as production inefficiency. However, if such inefficiencies are unlikely to be eliminated, the implied potential output increases may be unrealistic. We develop a multi-output, multi-input stochastic transformation function framework that permits various assumptions about how output composition may change when operating at full capacity. We apply our model to catcher-processor vessels in the Alaskan pollock fishery.     

A markup over average cost pricing rule for meat and poultry in the United States

This paper tests the hypothesis that meat and poultry wholesalers choose their inventory levels together with wholesale price so as to maximize profit made over the sales time of their stock. The behavioral assumption predicts that markup over average cost will match the inverse of the price elasticity of the sales time of inventory. Price elasticity of inventory sales time is estimated for beef, pork and poultry accounting for the simultaneity between these pricing decisions by adopting a systems approach. The estimated range for the inverse of these elasticities includes all the markups applied over the sample range of the time series.     

Coupon characteristics and brand choice

The effects of coupons on brand choice and repurchase behavior were examined in a laboratory panel experiment. Each of the 122 consumers purchased a candy bar on 10 different occasions; on the seventh purchase occasion, each consumer received an announcement of a new candy bar and one of four versions of a coupon. Results showed that whether or not a consumer will use a coupon depends on the size of the coupon offer, how easily the consumer can redeem the offer, how brand loyal the consumer is, and whether or not the consumer is deal prone. We also found, after statistically adjusting for our censored sample, that loyalty and coupon Characteristics influence whether or not a consumer will continue to purchase a formerly discounted brand. Information aggregation theory (Tybout & Scott, 1983) explains better than attribution theory how the coupon affects repurchase decisions.     

Historical resources, uncertainty and preservation values: An application of option and optimal stopping models

State agencies and private historical organizations frequently acquire historical sites with unknown characteristics. In this paper, we provide two approaches to evaluating the preservation decision. In the first approach, we show that a historical site which is not permanently preserved provides citizens with a certain flexibility whose value can be measured as an option on the maximum between the current real estate value and the preservation value. In the second approach, we assume that the organization has an infinite planning horizon and chooses the optimal sale date. Using a contingent valuation estimate of the public's willingness to pay for preservation of a specific historical site and the real estate price, we provide simulation values of the preservation option value and the optimal stopping rule.     

Willingness to Pay and the Cost of Commitment: An Empirical Specification and Test

In a static setting, willingness to pay for an environmental improvement is equal to compensating variation. In a dynamic setting, however, willingness to pay may also contain a commitment cost. In this paper we incorporate the dynamic nature of the value formation process into a stated preference study designed to test whether there is an important dynamic component (commitment cost) in stated preference values. The results clearly indicate that stated preference values can contain commitment costs and that these can be quite large: respondents offered the opportunity to delay their purchasing decisions until more information became available were willing to pay significantly less for improved water quality than those facing a now-or-never decision. These results have important consequences for the design and interpretation of stated preference data.