Joint-Product Export Smuggling and Export Tax Policy

The effect of smuggling on tax revenue collection and the revenue-maximizing tax rate is an unresolved issue in the smuggling literature. Clandestine and joint-product smuggling models arrive at different conclusions concerning smuggling's effect on tax revenue collection and the revenue-maximizing tax rate. Clandestine (joint-product) smuggling is consistent with the assumption that legal and illegal trade are substitutable (complementary) activities for the exporting firm. The effect of smuggling on the tax rate and tax revenue is shown to be dependent on whether smuggling and legal trade are assumed to be complementary or substitutable activities.     

The role of relationship quality in the stratification of vendors as perceived by customers

Companies implement preferred supplier programs to reduce their vendor relationships to a reasonable few. Consequently, vendors who do not effectively manage their customer-based relationships are strong candidates for deletion from a customer’s list of long-term suppliers. The emergence of preferred supplier programs suggests that businesses are beginning to formally recognize and reward differences between their qualified vendors. Vendor stratification is proposed as a framework for understanding the evolution of preferred vendor programs. With the growing interest in relationship marketing, a study was conducted to empirically examine the extent to which businesses use relationship quality perceptions to differentiate their qualified vendors. The findings support the notion that relationship quality is a higher-order construct that can be used as a basis for developing vendor stratification systems. The article concludes with a discussion of the managerial and research implications of the study findings. Michael J. Dorsch (Ph.D., University of Arkansas) is an associate professor of marketing at Clemson University. His research has been published in theJournal of the Academy of Marketing Science, theJournal of Business Research, and theJournal of Personal Selling and Sales Management, among others. His research interests include issues concerning relationship marketing and marketing research methods. Scott R. Swanson (Ph.D., University of Kentucky) is an assistant professor of marketing at East Carolina University. He previously spent 9 years as a purchasing executive and his research interets include issues related to services marketing, atmospherics, and marketing ethics. His research has been published in theJournal of Business to Business Marketing, theInternational Journal of Quality and Reliability Management, AMA Educators’ Proceedings, andRetailing: Theories and Practices for Today and Tomorrow. Scott W. Kelley (D.B.A., University of Kentucky) is an associate professor of marketing. His research has been published in theJournal of the Academy of Marketing Science, theJournal of Retailing, theJournal of Business Research, theJournal of Advertising, and theJournal of Personal Selling and Sales Management, among others. His research interests include issues concerning services marketing and marketing ethics.     

The Higher Earning in America: Are 529 Plans a Good Way to Save for College?

This article studies whether 529 plans are an effective way for most people to save for college. The 529 plans were created in 1996 to help low- and middle-income American families save for college. Since this time they have adopted more tax advantages and grown substantially as a result. While total balances in 529 plans now exceed $250 billion, less than 3.0 percent of households have a 529 plan. And the majority of 529 plan accounts are held by the wealthiest households. Low- and middle-income households receive little tax savings from investing in 529 plans, and some states count these plans against financial aid. Also, 529 plans are complicated, rules vary by state, and fund management fees tend to be high. Thus, 529 plans are not the panacea to college affordability.     

What is extreme about Mises’s extreme apriorism?

There is something extreme about Ludwig von Mises’s methodological apriorism, namely, his epistemological justification of the a priori element(s) of economic theory. His critics have long recognized and attacked the extremeness of Mises’s epistemology of a priori knowledge. However, several of his defenders have neglected what is (and what has long been recognized by his critics to be) extreme about Mises’s apriorism. Thus, the argument is directed less against Mises than against those contributions to the secondary literature that assert his methodological moderation while overlooking what the most prominent critics have found extreme about Mises’s apriorism. Defending Mises as a merely moderate apriorist because he held only a narrow part of the foundation of economics to be a priori is a straw-man defense against criticisms of his apriorism as epistemologically extreme.     

The Interaction of Financial Attitudes and Financial Knowledge: Evidence for Low-Income Hispanic Families

We add to the literature on the association of financial knowledge and financial attitudes with financial outcomes by focusing on predominantly low-income Hispanic families. We examine (i) saving for emergencies, for college, and in 401(k) plans, and (ii) ownership of a home, land or rental property, and an investment account. We find that financial knowledge is strongly related to our savings measures and to owning an investment account. Financial attitudes play less of a role, but assume some importance when interacted with financial knowledge. Self-reported financial knowledge in addition to factual financial knowledge is associated with favorable financial outcomes. Our results are important for the upward economic mobility of a demographic group that has received less attention in the literature.     

Competition,Prices and Quality in the Market for Physician Consultations

Prices for consultations with General Practitioners (GP's) in Australia are unregulated, and patients pay the difference between the price set by the GP and a fixed reimbursement from the national tax‐funded Medicare insurance scheme. We construct a Vickrey‐Salop model of GP price and quality competition and test its predictions using individual GP‐level data on prices, the proportion of patients who are charged no out‐of‐pocket fee, average consultation length, and characteristics of the GP's, their practices and their local areas. We measure the competition to which the GP is exposed by the distance to other GP practices and allow for the endogeneity of GP location decisions with measures of area characteristics and area fixed‐effects. Within areas, GP's with more distant competitors charge higher prices and a smaller proportion of their patients make no out‐of‐pocket payment. GP's with more distant competitors also have shorter consultations, though the effect is small and statistically insignificant.     

Brexit: How Will UK Agriculture Fare?

There is little doubt that Brexit would have significant implications for UK agriculture, a sector with strong trade links to the EU and strong reliance on CAP income support. This article reports preliminary results from employing a Computable General Equilibrium Model, a Partial Equilibrium Model and Farm Level Models to explore selected trade and domestic policy scenarios post‐Brexit. These allow for the estimation of changes in producer prices, production and farm incomes against a baseline scenario of continued EU membership. Under a Free Trade Agreement with the EU, agricultural impacts are relatively modest. By contrast, unilateral removal of import tariffs has significant negative impacts on prices, production and incomes. Adoption of the EU's WTO tariff schedule for all imports favours net importers (e.g. dairy) and harms net exporters (e.g. sheep). Given the strong dependence of most UK farms on direct payments, their removal worsens negative impacts of new trade arrangements and offsets positive impacts. Impacts vary across different types and sizes of farm, but also regionally. However, the period of adjustment to new trade and domestic policy conditions may prove very challenging for a large number of farm businesses.     

Measuring rural consumers’ willingness to pay for quality labels using experimental auctions: the case of aflatoxin‐free maize in Kenya

Aflatoxins are a common health hazard in tropical countries, especially in rural areas. New methods to reduce aflatoxin levels in food staples, as well as cheaper test methods, are being developed, but consumers’ willingness to pay (WTP) for these improvements is unknown. A survey was conducted with a representative sample of rural consumers (1,344 in total, 63% women) in all major maize‐production zones of Kenya. The survey included an experimental auction with maize products of different qualities. The results showed that many rural consumers were aware of aflatoxins, but few understood their health risks. Respondents were willing to pay a premium for maize tested for aflatoxins and labeled, but asked a high discount for maize that was visibly contaminated with moldy grain. The premium was higher for respondents with education and in regions with aflatoxicosis outbreaks. Knowledge of aflatoxins substantially reduced the overall WTP, but did not increase the WTP for tested maize. Welfare analysis indicates that mandatory testing would result in substantial benefits if the cost of testing can be lowered to below the premium.