Ag econ angst crisis revisited

The present paper was inspired by and is a response to the Rola-Rubzen, Hardaker and Dillon paper 'Agricultural economists and world poverty: progress and prospects' (Rola-Rubzen et al. 2001). It is agreed that the position of agricultural economists in foreign aid and poverty programs has declined over recent decades. Such a feeling of guilt and remorse expressed by the above authors does indeed create considerable 'angst'. A major reason for this state of affairs lies in 'the flavour of the month' approach of the development agencies. These include women in development, gender-based farming systems research, household nutrition and food security, people participation, and targeting the poorest of the poor. These fads have driven disciplinary considerations to the wall and the more widely-defined objectives have reduced the drive for economic efficiency. We argue there is still a place for better designed and delivered assistance programs within the wider framework of assistance that has become fashionable. Greater application of institutional principles in both the political processes associated with assistance and the implementation agencies would improve the outcomes of many projects. Particular attention would need to be given to the interface between the development agencies and recipient governments. The present paper picks up on the market failure aspects of agriculture's rather poor contribution to development, and develops a wider perspective in terms of the new institutional economics and a continuing role for the agricultural economist.     

POLITICAL PROCESS AND THE FORMATION OF ECONOMIC POLICY

Institutional economics has some useful things to say about government policy-forming processes. It focuses attention on the structural components of government institutions which shape the direction of policy formation and its delivery. In this article, the author discusses how institutional models of government decision-making may be adapted to parliamentary systems of government. This approach has some merit because it rescues analysis of government processes from models based on the US constitutional system.     

a taxi for miss doolittle

Why is it so difficult to get a taxi in London? Robin Jenks is confident that without regulation the service would be greatly improved. Is it really necessary for taxi drivers to have ‘The Knowledge’?     

An exceptional development pattern

This paper investigates India's exceptional development pattern, specifically the major importance of information technology services (ITS), and compares it with China's development pattern. Both countries want to develop capabilities for carrying out the innovation of technologies that compete at the state-of-the-art in the world market. The paper posits that technological/economic success in the contemporary world market requires the ability to innovate complex technologies and complex technology-related services. The share of trade represented by complex technologies is compared with the “high-tech” share. The trading patterns of the two countries are compared using United Nations data. Two case studies of Indian ITS companies are then compared with two case studies of Chinese manufacturing companies. Historical and cultural differences appear to explain some of the differences in the development patterns of the companies located in the two countries.     

Adverse selection in group insurance: The virtues of failing to represent voters

Compared with non-union workers, union workers take more of their compensation in the form of insurance. This may be because unions choose democratically, and democratic choice mitigates adverse selection in group insurance. Relative to individually-purchased insurance, we show that group insurance chosen by an ideal profit-maximizing employer can be worse for every employee, while group insurance chosen democratically can be much better. The reason is that democracy can fail to represent the preferences of almost half the group.Received: January 2003, Accepted: September 2004, JEL Classification: J51, D82, G22     

On the real effects of inflation and inflation uncertainty in Mexico

We estimate an augmented multivariate GARCH-M model of inflation and output growth for Mexico at business cycle frequencies. The main findings are: (1) inflation uncertainty has a negative and significant effect on growth; (2) once the effect of inflation uncertainty is accounted for, lagged inflation does not have a direct negative effect on output growth; (3) However as predicted by Friedman and Ball, higher average inflation raises inflation uncertainty, and the overall net effect of average inflation on output growth in Mexico is negative. That is, average inflation is harmful to Mexican growth due to its impact on inflation uncertainty. (4) The Mexican Presidential election cycle significantly raises inflation uncertainty both during the year of the election and the year following the election which has correspondingly negative effects on output growth.     

Can intertemporal choice experiments elicit time preferences for consumption?

The paper considers what can be inferred about experimental subjects’ time preferences for consumption from responses to laboratory tasks involving tradeoffs between sums of money at different dates, if subjects can reschedule consumption spending relative to income in external capital markets. It distinguishes three approaches identifiable in the literature: the straightforward view; the separation view; and the censored data view. It shows that none of these is fully satisfactory and discusses the resulting implications for intertemporal decision-making experiments. JEL Classification C90, C91, D90, D91, D11, D12     

Growth, crisis and change in the insurance industry: a retrospect

The insurance industry currently finds itself in a revolutionary situation characterized, in part, by the impact of new direct marketing techniques, facilitated by new technologies; by corporate restructuring and the creation of international mega-corporations; and by the accelerating globalization of the industry. This article surveys recent research on insurance history with the aim of placing these developments in their long-run context. Three areas are examined for evidence of continuities and discontinuities with the past: namely, the impact of technology, the interaction between markets and organizational change, and the globalization of insurance and its relationship to economic growth.     

Issues in decentralizing the provision of education

This paper analyzes some of the problems that arise in decentralizing education to the private sector. We concentrate on the difficulties that result from the heterogeneity of students and competition among schools in a location setting. We analyze two main issues, the resources expended by schools and the mix of students in schools, and report on results for two others, the location of schools and their number. For each of these, we investigate the extent to which decentralizing the provision of schooling results in an efficient allocation of resources, and consider the use of vouchers to improve the situation. Our analysis draws on elements of three distinct methodologies: the theory of clubs, location theory, and the theory of monopolistic competition. We find that private schooling will typically be inefficient, but that inefficiency may sometimes be corrected by appropriately designed vouchers.We would like to thank Olivier Debande, Jean-François Wen, two anonymous referees, and seminar participants at the 1st meeting of the Canadian Public Economics Study Group and the 51 st congress of the International Institute of Public Finance for helpful comments. Stefan Buergi and Luc Savard provided useful research assistance. We are also grateful to the SSHRCC and the FCAR for financial support.