INTERFAMILY TRANSFERS AS ALTERNATIVES TO GOVERNMENT TRANSFERS TO PERSONS*

How have government transfers altered the distribution of income, the level of work effort, and the rate of personal saving? Most scholars approach this question by comparing the current level of government transfers with the unrealistic counterfactual of a zero-transfer situation. This method overlooks the fact that nongovernment transfers existed before government transfers and the possibility that private transfers might have grown more if government transfers had grown less. This paper explores the significance of one private alternative to government transfers-namely, direct interfamily giving of cash, food, and housing. Fragmentary evidence suggests that such interfamily transfer was quantitatively more important than governmental transfer for these purposes thirty years ago, but is now only half as great. If current government transfers are conversions of, or substitutes for, interfamily transfers, then it follows that some of the benefits of government transfer “slide” over to “secondary beneficiaries,” i.e. those who would have made the private transfers. Further, it follows that the effects of government transfers are not much different from those of the private transfers which they replace.     

Intertemporal separability in overlapping-generations models

In a pure exchange overlapping-generations model with many goods, but a single consumer with preferences separable between two periods of life, there are (generically) finitely many equilibria in which money has no value. If money has value, then (generically) there is at most one dimension of indeterminacy. This property does not generalize to a model with many consumers and general preferences. It is shown why a separable representative consumer implies such strong conclusions. It is also shown that the absence of income effects leads to similar results.     

Self-Fulfilling Debt Crises

We characterize the values of government debt and the debt's maturitystructure under which financial crises brought on by a loss of confidence inthe government can arise within a dynamic, stochastic general equilibriummodel. We also characterize the optimal policy response of the government tothe threat of such a crisis. We show that when the country's fundamentalsplace it inside the crisis zone, the government may be motivated to reduceits debt and exit the crisis zone because this leads to an economic boom anda reduction in the interest rate on the government's debt. We show thatthis reduction can be gradual if debt is high or the probability of a crisisis low. We also show that, while lengthening the maturity of the debt canshrink the crisis zone, credibility-inducing policies can have perverseeffects.     

Where can obesity management policy make the largest impact? Evaluating sub-populations through a microsimulation approach

Background: There is a critical need to focus limited resources on sub-groups of patients with obesity where we expect the largest return on investment. This paper identifies patient sub-groups where an investment may result in larger positive economic and health outcomes.

Methods: The baseline population with obesity was derived from a public survey database and divided into sub-populations defined by demographics and disease status. In 2016, a validated model was used to simulate the incidence of diabetes, absenteeism, and direct medical cost in five care settings. Research findings were derived from the difference in population outcomes with and without weight loss over 15 years. Modeled weight loss scenarios included initial 5% or 12% reduction in body mass index followed by a gradual weight regain. Additional simulations were conducted to show alternative outcomes from different time courses and maintenance scenarios.

Results: Univariate analyses showed that age 45–64, pre-diabetes, female, or obesity class III are independently predictive of larger savings. After considering the correlation between these factors, multivariate analyses projected young females with obesity class I as the optimal sub-group to control obesity-related medical expenditures. In contrast, the population aged 20–35 with obesity class III will yield the best health outcomes. Also, the sub-group aged 45–54 with obesity class I will produce the biggest productivity improvement. Each additional year of weight loss maintained showed increased financial benefits.

Conclusions: This paper studied the heterogeneity between many sub-populations affected by obesity and recommended different priorities for decision-makers in economic, productivity, and health realms.     

Research and development target‐setting difficulties addressed through the emergent method: technology forecasting using data envelopment analysis

The aim of this study is to provide a foundation for researchers and managers to discuss and resolve difficulties associated with research and development (R&D) target‐setting. While multiple studies mention the difficulty of R&D target‐setting, few have compiled reasons for these difficulties or addressed this issue in detail. This paper provides one of the first studies outlining reasons for R&D target‐setting difficulties through a literature review. It also provides an initial set of analyses and results after applying an emerging quantitative method, Technology Forecasting Using Data Envelopment Analysis (TFDEA), to illustrate these difficulties step‐by‐step to commercial airplanes. Results include determining the state of art in commercial airplane technology and technological rate‐of‐change variants in setting R&D targets.     

Price discovery and intermediation in linked emissions trading markets: A laboratory study

Many new and proposed emissions trading systems involve multiple countries and regions. The introduction of interregional trading raises questions about how flexible state- or national-level authorities should be in allowing individual firms to trade with firms or authorities in other states or countries. This paper uses laboratory methods to evaluate the efficiency and pricing performance of linking trading across regions at the firm-to-firm level. In one treatment, individual firms trade directly with firms or authorities in other regions. We compare performance in this treatment to an intergovernmental trading treatment, where emissions trading is restricted to occur only between intermediaries. A baseline treatment of autarky, where firms only trade with other firms in their country or region, provides a benchmark to assess the efficiency benefits of allowing linking. Although efficiency and price discovery are both improved by allowing intermediation in linked permit markets, we find that further gains can be realized through direct firm to firm trading. Buyers in high cost regions and sellers in low cost regions benefit the greatest from linking.     

The process of internationalization in the operating firm

Two factors have been emphasised as influencing the choice of, and subsequent shifts between, modes of foreign market servicing: (1) market-specific knowledge; and (2) the generalised knowledge from operating internationally. The process-oriented literature on internalisation has tended to emphasise the former over the latter. This article maintains that market-specific knowledge is not the only source of information available to a firm. As firms operate in foreign markets they develop, in addition to networks of institutional arrangements, a knowledge of the process of internationalization. Account therefore has to be taken of the general knowledge from operating internationally in understanding the development of institutional arrangements in foreign markets. Consequently, the appropriate unit of analysis is not the individual market but the operating firm as a whole. This argument is illustrated with reference to an empirical study of the internationalization of 25 UK-based organizations.     

Non-binding sequential exchange between discounting agents

When exchange is sequential, and no binding agreements can be written, the agent acting first is exposed to the possibility that even if he honors the agreement his trading partner might not. Repeated interaction of this nature is modeled. Exchange will successfully occur when there are ample gains from trade for the second agent, implying that the first agent may be better off with less bargaining power. Thus, the first agent may want to bargain at less than his full ability in order to ensure that an otherwise unsuccessful transaction will successfully occur. Additionally, if the first agent can facilitate exchange by hiring an escrow service, he will do so when his bargaining advantage is sufficiently large.JEL subject classification C70, D40, L14