Why do parents make their children work? A test of the poverty hypothesis in rural areas of Burkina Faso

It is often argued that child labour is caused by poverty. However,much child labour takes place in rural areas characterized bysubstantial labour market imperfections. A model of rural householdlabour supply is developed that provides testable implicationsfor two versions of the poverty hypothesis: that child labouris due to a binding subsistence constraint and that child leisureis a luxury good. We find that in rural Burkina Faso childrendo not provide labour to meet households' subsistence needsand that child leisure is a normal good. The evidence suggeststhat labour market imperfections are a main reason for usingchild labour.     

Two-person dynamic equilibrium in the capital market

When several investors with different risk aversions trade competitivelyin a capital market, the allocation of wealth fluctuates randomlyamong them and acts as a state variable against which each marketparticipant will want to hedge. This hedging motive complicatesthe investors' portfolio choice and the equilibrium in the capitalmarket. This article features two investors, with the same degreeof impatience, one of them being logarithmic and the other havingan isoelastic utility function. They face one risky constant-return-to-scalestationary production opportunity and they can borrow and lendto and from each other. The behaviors of the allocation of wealthand of the aggregate capital stock are characterized, alongwith the behavior of the rate of interest, the security marketline, and the portfolio holdings.     

Evaluating the impact of rising fertilizer prices on crop yields

Because of tensions on fossil energy and phosphorus markets, the rise in fertilizer prices observed during the last decades may continue in the future, putting into question production pathways relying heavily on crop intensification. To evaluate how, in this context, economic choices may alter crop yields, we first construct different fertilizer price scenarios to 2050 based on an econometric relation with oil and gas prices. Other possible scenarios, such as the continuation of historical trends, are also considered. The resulting changes in fertilizer price range between +0.8% and +3.6% per year over the 2005–2050 period. These scenarios are tested in a global land‐use model incorporating an endogenous representation of the land–fertilizer substitution. We find that the supply‐side response to rising fertilizer prices could lower crop yields in 2050 from ?6% to ?13%, with a corresponding increase in global cropland area ranging between 100 and 240 Mha if the demand for food and nonfood products has to be met. The sensitivity of these results is tested with regard to assumptions on food consumption, change in potential yield and nutrient use efficiency.     

The theorems of international trade under generalized uncertainty

A number of authors have extended the theorems of international trade to the case where the output of the various production processes (for pre-set inputs) is random. But they limited their analysis to a very special type of technological randomness known in the financial literature as ‘scalar uncertainty’. The purpose of the present paper is to extend the theorems to a much wider class of random neoclassical production functions. It is assumed that there exists a unified stock market worldwide.     

Adoption des Politiques de Protection de l'Environnement et performance des Entreprises Camerounaises

The objective of this paper is to evaluate the effect of the environmental protection policies of by Cameroonian firms on their performance. It uses the endogenous switching regression technique and propensity scores applied to micro-data from 639 firms in Cameroon. The results show that only 17% of firms adopt these measures, while on average 85% of firms produce solid, gaseous or liquid waste. The results also indicate that the adoption of these environmental protection policies increases operating costs while significantly improving the turnover and the performance of the productive capacity of the company. These increases are 39.11%, 58.6%, and 38.63% for operating costs, turnover and return on productive capacity of the company, respectively. However, firms can also suffer significant losses resulting from the non-adoption of environmental policies. In fact, firms that do not adopt environmental protection policies have their performance reduced by an average of 1.625 percentage points.     

From volatility smiles to the volatility of volatility

Decisions in Economics and Finance - The paper reviews models of the option surface and reduced-form models for stochastic volatility in continuous time, under the risk-neutral measure. It defines...     

Using metaphors in new brand design

This paper addresses an important gap in brand development. While attention has been rightly focused on consumer understanding of brand imagery, insufficient attention has been given to how the firm's managers create, understand and communicate to each other something so intangible as a future brand's vision. We demonstrate how using metaphors in brand design enhances the ability of a cross‐functional team to create a coherent brand vision: facilitating both creativity and its communication. Brand visions are vital given the essential periodic improvements and mutations brands must undergo, without sacrificing the integrity and values which drive their purchase. Management complexity arises because brand development happens in a multi‐disciplinary environment. Moreover these different managers must translate the intangible meanings held by consumers into very tangible product and service specifications. The role and nature of metaphor in this process is examined in detail. We then provide practical examples of how this technique has been used with managers in a variety of branding tasks.