Land Use Effect on the CN Model Parameters in a Tropical Dry Environment

Dry tropical forests account for over 1,000,000 km², and there is still lack of knowledge on their hydrologic processes. The curve number (CN) hydrologic model developed by the Natural Resources Conservation Service (NRCS) is widely applied for runoff determination in various parts of the world, but not so in tropical semiarid regions. This study analyzes the impact of land use changes on the CN model in a tropical semiarid environment, in two catchments of native dry tropical forest and thinned dry tropical forest land use from 2009 to 2012. The CN model was calibrated and validated for the NRCS recommended initial abstraction ratio λ = 0.2, and for λ evaluated from rainfall and runoff data. A reliability analysis was performed using Monte Carlo simulation. Model goodness-of-fit was assessed with statistical criteria. A total of 42 and 40 rainfall-runoff events were analyzed for the native and thinned dry tropical forest, respectively. Characteristic λ values of 0.15 and 0.11 were determined for the two respective catchments. Although CN values were similar for both land uses, CN_λ=0.20 = 80 and CN_{median λ} = 77, the thinned catchment showed a higher CN model parameters variability. The CN model was more sensitive to variations of CN values than to those of λ. This study showed that no matter the vegetation management in a dry tropical forest environment, modeled runoff is not affected by λ, but rather affected by CN, which represents soil, landuse and management.     

Innovation and the opportunity cost of monopoly

Innovation enables monopolists to lower their costs, expand their outputs, and reduce their prices. It is conventional to conclude that social welfare unambiguously increases as a result. Assuming linear demand and marginal cost, this paper shows, however, that innovation raises the opportunity cost of monopoly: as a firm enjoying market power becomes more efficient, greater amounts of surplus are sacrificed by consumers because of the progressive monopolist's failure to produce the new, larger competitive output. Innovation, in other words, increases the social value of competition by raising the deadweight cost of monopoly. Copyright © 2008 John Wiley & Sons, Ltd.     

The effect of seasonal adjustment on the properties of business cycle regimes

We study the impact of seasonal adjustment on the properties of business cycle expansion and recession regimes using analytical, simulation and empirical methods. Analytically, we show that the X‐11 adjustment filter both reduces the magnitude of change at turning points and reduces the depth of recessions, with specific effects depending on the length of the recession. A Monte Carlo analysis using Markov‐switching models confirms these properties, with particularly undesirable effects in delaying the recognition of the end of a recession. However, seasonal adjustment can help to clarify the true regime when this is well underway. These results continue to hold when a seasonally non‐stationary process with regime‐dependent mean is misspecified as one with deterministic seasonal effects. The empirical findings, based on four coincident US business cycle indicators, reinforce the analytical and simulation results by showing that seasonal adjustment leads to the identification of longer and shallower recessions than obtained using unadjusted data. Copyright © 2008 John Wiley & Sons, Ltd.