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Full-Text Articles in Other Economics

Partial Implementation Of Cool: Economic Effects In The U.S. Seafood Industry, Siny Joseph, Nathalie Lavoie, Julie A. Caswell Jan 2009

Partial Implementation Of Cool: Economic Effects In The U.S. Seafood Industry, Siny Joseph, Nathalie Lavoie, Julie A. Caswell

PERI Working Papers

Mandatory Country of Origin Labeling (MCOOL) was implemented on seafood in the United States on April 4, 2005. MCOOL exempts the foodservice sector and excludes processed seafood from labeling. This paper contributes to understanding the economics of the MCOOL law for seafood by showing that current partial implementation may have unintended consequences on the domestic supply chain. While labeling satisfies the market demand for information provision in one market, exemptions in the other market may create incentives for the diversion of imports, which are assumed to be lower in quality than domestic seafood, to the non-labeled sector. Analyzing alternate scenarios ...


Securing The Border From Invasives: Robust Inspections Under Severe Uncertainty, L. Joe Moffitt, John K. Stranlund, Craig D. Osteen Jan 2009

Securing The Border From Invasives: Robust Inspections Under Severe Uncertainty, L. Joe Moffitt, John K. Stranlund, Craig D. Osteen

PERI Working Papers

Two important features of agricultural quarantine inspections of shipping containers for invasive species at U.S. ports of entry are the general absence of economic considerations and the severe uncertainty that surrounds invasive species introductions. In this article, we propose and illustrate a method for determining an inspection monitoring protocol that addresses both issues. An inspection monitoring protocol is developed that is robust in maximizing the set of uncertain outcomes over which an economic performance criterion is achieved. The framework is applied to derive an alternative to Agricultural Quarantine Inspection (AQI) for shipments of fruits and vegetables as currently practiced ...


Comparing The Effectiveness Of Regulation And Pro-Social Emotions To Enhance Cooperation: Experimental Evidence From Fishing Communities In Colombia, Maria Claudia Lopez, James J. Murphy, John M. Spraggon, John K. Stranlund Jan 2009

Comparing The Effectiveness Of Regulation And Pro-Social Emotions To Enhance Cooperation: Experimental Evidence From Fishing Communities In Colombia, Maria Claudia Lopez, James J. Murphy, John M. Spraggon, John K. Stranlund

PERI Working Papers

This paper presents the results from a series of framed field experiments conducted in fishing communities off the Caribbean coast of Colombia. The goal is to investigate the relative effectiveness of exogenous regulatory pressure and pro-social emotions in promoting cooperative behavior in a public goods context. The random public revelation of an individual’s contribution and its consequences for the rest of the group leads to significantly higher public good contributions and social welfare than regulatory pressure, even under regulations that are designed to motivate fully efficient contributions.


A Safety Valve For Emissions Trading, John K. Stranlund Jan 2009

A Safety Valve For Emissions Trading, John K. Stranlund

PERI Working Papers

This paper considers the optimal design of an emissions trading program that includes a safety valve tax that allows pollution sources to escape the emissions cap imposed by the aggregate supply of emissions permits. I demonstrate that an optimal hybrid emissions trading/emissions tax policy involves a permit supply that is strictly less than under a pure emissions trading scheme and a safety valve tax that exceeds the optimal pure emissions tax as long as expected marginal damage is an increasing function. While the expected level of emissions under a hybrid policy may be more or less than under pure ...


Estimation Of Treatment Effect Of Asthma Case Management Using Propensity Score Methods, Sylvia Brandt, Sara Gale, Ira Tager Jan 2009

Estimation Of Treatment Effect Of Asthma Case Management Using Propensity Score Methods, Sylvia Brandt, Sara Gale, Ira Tager

PERI Working Papers

Asthma, treatment effect, health intervention, propensity scores


Risk Aversion And Compliance In Markets For Pollution Control, John K. Stranlund Jan 2006

Risk Aversion And Compliance In Markets For Pollution Control, John K. Stranlund

PERI Working Papers

This paper examines the effects of risk aversion on compliance choices in markets for pollution control. A firm’s decision to be compliant or not is independent of its manager’s risk preference. However, noncompliant firms with risk averse managers will have lower violations than otherwise identical firms with risk neutral managers. The violations of noncompliant firms with risk averse managers are independent of differences in their benefits from emissions and their initial allocations of permits if and only if their managers’ utility functions exhibit constant absolute risk aversion. However, firm-level characteristics do impact violation choices when managers have coefficients ...


Price-Based Vs. Quantity-Based Environmental Regulation Under Knightian Uncertainty: An Info-Gap Robust Satisficing Perspective, John K. Stranlund, Yakov Ben-Haim Jan 2006

Price-Based Vs. Quantity-Based Environmental Regulation Under Knightian Uncertainty: An Info-Gap Robust Satisficing Perspective, John K. Stranlund, Yakov Ben-Haim

PERI Working Papers

Conventional wisdom among environmental economists is that the relative slopes of the marginal social benefit and marginal social cost functions determine whether a price-based or quantity-based environmental regulation leads to higher expected social welfare. We revisit the choice between price-based vs. quantity-based environmental regulation under Knightian uncertainty; that is, when uncertainty cannot be modeled with known probability distributions. Under these circumstances, the policy objective cannot be to maximize the expected net benefits of emissions control. Instead, we evaluate an emissions tax and an aggregate abatement standard in terms of maximizing the range of uncertainty under which the welfare loss from ...


Heterogeneity And Common Pool Resources: Collective Management Of Forests In Himachal Pradesh, India, Sirisha C. Naidu Jan 2005

Heterogeneity And Common Pool Resources: Collective Management Of Forests In Himachal Pradesh, India, Sirisha C. Naidu

PERI Working Papers

In the past two decades, theoretical and empirical evidence suggests that communities of resource users are capable of overcoming social dilemmas, and are capable of creating and sustaining institutions designed to prevent degradation of common pool natural resources. However, there is incomplete understanding of what motivates this group-level behavior and why some communities are better adept at solving collective action problems than others. This paper specifically explores the role of group heterogeneity in collective action among forest communities in the northwestern Himalayas. Heterogeneity can have important social and ecological consequences and understanding both its nature and effects can help in ...


An Investigation Of Voluntary Discovery And Disclosure Of Environmental Violations Using Laboratory Experiments, James J. Murphy, John K. Stranlund Jan 2005

An Investigation Of Voluntary Discovery And Disclosure Of Environmental Violations Using Laboratory Experiments, James J. Murphy, John K. Stranlund

PERI Working Papers

This paper uses laboratory experiments to test individual responses to policies that seek to encourage firms to voluntarily discover and disclose violations of environmental standards. We find that while it is possible to motivate a significant number of voluntary disclosures without adversely affecting environmental quality, this result is sensitive to both the fine for disclosed violations and the assumption that firms know their compliance status without cost. When firms have to expend resources to determine their compliance status, motivating a significant number of violation disclosures yields worse environmental quality. Finally, relative to conventional enforcement, disclosure polices will result in more ...


Landowner Driven Sustainable Forest Management And Value-Added Processing, David T. Damery Jan 2005

Landowner Driven Sustainable Forest Management And Value-Added Processing, David T. Damery

PERI Working Papers

The Massachusetts Woodlands Cooperative, LLC (MWC) is working to help members conduct sustainable forestry of the highest standards while increasing financial returns from harvest activities. The forests of Massachusetts, the 3rd most densely populated of the United States, are threatened. Decades of high grading and the threat of conversion to alternative use present challenges for maintaining a forested landscape. Despite being 60% forested Massachusetts imports approximately 98% of the wood fiber that its citizens consume. MWC is a forest management, processing and marketing cooperative organized by and on behalf of forest landowners in western Massachusetts. The cooperative was envisioned in ...


Interaction Between Food Attributes In Markets: The Case Of Environmental Labeling, Gilles Grolleau, Julie A. Caswell Jan 2005

Interaction Between Food Attributes In Markets: The Case Of Environmental Labeling, Gilles Grolleau, Julie A. Caswell

PERI Working Papers

Some consumers derive utility from using products produced with specific processes, such as environmentally friendly practices. Means of verifying these credence attributes, such as certification, are necessary for the market to function effectively. A substitute or complementary solution may exist when consumers perceive a relationship between a process attribute and other verifiable product attributes. We present a model where the level of search and experience attributes influences the likelihood of production of eco-friendly products. Our results suggest that the market success of ecofriendly food products requires a mix of environmental and other verifiable attributes that together signal credibility.


What Motivates Common Pool Resource Users? Experimental Evidence From The Field, Maria Alejandra Vélez, John K. Stranlund, James J. Murphy Jan 2005

What Motivates Common Pool Resource Users? Experimental Evidence From The Field, Maria Alejandra Vélez, John K. Stranlund, James J. Murphy

PERI Working Papers

This paper develops and tests several models of pure Nash strategies of individuals who extract from a common pool resource when they are motivated by a combination of self-interest and other motivations such as altruism, reciprocity, inequity aversion and conformism. We test whether an econometric summary of subjects’ strategies is consistent with one of these motivations using data from a series of common pool resource experiments conducted in three regions of Colombia. As expected, average extraction levels are less than that predicted by a model of pure self-interest, but are nevertheless sub-optimal. Moreover, we find that a model of conformism ...


Inspections To Avert Terrorism: Robustness Under Severe Uncertainty, L. Joe Moffitt, John K. Stranlund, Barry C. Field Jan 2005

Inspections To Avert Terrorism: Robustness Under Severe Uncertainty, L. Joe Moffitt, John K. Stranlund, Barry C. Field

PERI Working Papers

Protecting against terrorist attacks requires making decisions in a world in which attack probabilities are largely unknown. The potential for very large losses encourages a conservative perspective, in particular toward decisions that are robust. But robustness, in the sense of assurance against extreme outcomes, ordinarily is not the only desideratum in uncertain environments. We adopt Yakov Ben-Haim’s (2001b) model of information gap decision making to investigate the problem of inspecting a number of similar targets when one of the targets may be attacked, but with unknown probability. We apply this to a problem of inspecting a sample of incoming ...


Market Power In Direct Marketing Of Fresh Produce: Community Supported Agriculture Farms, Daniel A. Lass, Nathalie Lavoie, T. Robert Fetter Jan 2005

Market Power In Direct Marketing Of Fresh Produce: Community Supported Agriculture Farms, Daniel A. Lass, Nathalie Lavoie, T. Robert Fetter

PERI Working Papers

CSA farms establish a loyal customer base and, potentially, market power. A new empirical industrial organization (NEIO) approach and survey data from Northeast CSA farms are used to determine whether CSA farms have market power and the extent to which they exercise their market power. Results suggest CSA farms exert about two percent of their potential monopoly power.


A Laboratory Investigation Of Compliance Behavior Under Tradable Emissions Rights: Implications For Targeted Enforcement, James J. Murphy, John Stranlund Jan 2005

A Laboratory Investigation Of Compliance Behavior Under Tradable Emissions Rights: Implications For Targeted Enforcement, James J. Murphy, John Stranlund

PERI Working Papers

This paper uses laboratory experiments to test the theoretical observations that both the violations of competitive risk-neutral firms and the marginal effectiveness of increased enforcement across firms are independent of differences in their abatement costs and their initial allocations of permits. This conclusion has important implications for enforcing emissions trading programs because it suggests that regulators have no justification for targeting their enforcement effort based on firm-level characteristics. Consistent with the theory, we find that subjects’ violations were independent of parametric differences in their abatement costs. However, those subjects that were predicted to buy permits tended to have higher violation ...


Pricing-To-Market: Price Discrimination Or Product Differentiation?, Nathalie Lavoie, Qihong Liu Jan 2004

Pricing-To-Market: Price Discrimination Or Product Differentiation?, Nathalie Lavoie, Qihong Liu

PERI Working Papers

We employ a vertical differentiation model to examine the potential bias in pricing-tomarket (PTM) results when using unit values aggregating differentiated products. Our results show that: i) false evidence of PTM (“pseudo PTM”) is always found when using unit values, whether the law of one price holds or not; and ii) the extent to which results are biased due to pseudo PTM increases with the level of product differentiation. Correspondingly, our simulation results suggest that: i) it is possible to get a statistically significant estimate of the exchange rate coefficient, even when there is no real PTM; ii) the probability ...


An Economic Valuation Of Recreational Shellfishing On Cape Cod, David T. Damery, P. Geoffrey Allen Jan 2004

An Economic Valuation Of Recreational Shellfishing On Cape Cod, David T. Damery, P. Geoffrey Allen

PERI Working Papers

Estimated total value for recreational shellfishing on Cape Cod was $7.4 million in 2002, based on results of a survey of 233 shellfish permit holders, a figure that has roughly kept pace with inflation based on a similar study conducted in 1975. The total value is made up of two components, the actual permit fees collected ($387,000) and an estimate of consumer surplus, which was based on willingness to accept compensation to give up a fishing permit and hence is unbounded by the survey respondents’ income. An estimate based on willingness-to-pay (WTP) gave a total value estimate of ...


Hypothetical Bias In Dichotomous Choice Contingent Valuation Studies, Michael Ash, James J. Murphy, Thomas H. Stevens Jan 2004

Hypothetical Bias In Dichotomous Choice Contingent Valuation Studies, Michael Ash, James J. Murphy, Thomas H. Stevens

PERI Working Papers

This paper uses a meta-analysis to explore the relationship between hypothetical bias and the price respondents are asked to pay. For public goods, the results clearly indicate a difference in the price elasticity between hypothetical and actual payment conditions. Since the bias increases for larger dollar amounts, any simple guidelines, such as NOAA’s “divide by two” rule of thumb, could be misleading. Future attempts to calibrate contingent valuation responses should reflect this price sensitivity.


The Economics Of Implementing Traceability In Beef Supply Chains: Trends In Major Producing And Trading Countries, Diogo M. Souza-Monteiro, Julie A. Caswell Jan 2004

The Economics Of Implementing Traceability In Beef Supply Chains: Trends In Major Producing And Trading Countries, Diogo M. Souza-Monteiro, Julie A. Caswell

PERI Working Papers

Countries have implemented traceability systems, especially after discovery of BSE in cattle, in order to quickly identify hazard sources. We compare the economic impacts of mandatory and voluntary systems in the EU, Japan, Australia, Brazil, Argentina, Canada, and the United States in terms of the systems’ breadth, depth, and precision.


Direct And Market Effects Of Enforcing Emissions Trading Programs: An Experimental Analysis, James J. Murphy, John K. Stranlund Jan 2004

Direct And Market Effects Of Enforcing Emissions Trading Programs: An Experimental Analysis, James J. Murphy, John K. Stranlund

PERI Working Papers

Since firms in an emissions trading program are linked together through a permit market, so too are their compliance choices. Thus, enforcement strategies for trading programs must account for not only the direct effects of enforcement on compliance and emissions decisions, but also the indirect effects that occur because changes in enforcement can induce changes in permit prices. This paper uses laboratory experiments to test for these direct and indirect market effects. Consistent with theoretical predictions, we find a direct effect of enforcement on individual violations, as well as a countervailing market effect through the permit price. Thus, the productivity ...


Enforcing Transferable Permit Systems In The Presence Of Transaction Costs, Carlos A. Chavez, John K. Stranlund Jan 2004

Enforcing Transferable Permit Systems In The Presence Of Transaction Costs, Carlos A. Chavez, John K. Stranlund

PERI Working Papers

In this paper we examine the impacts of transaction costs on enforcing a transferable emissions permit system. We derive an enforcement strategy with a self-reporting requirement that achieves complete compliance in a cost-effective manner. In the absence of transaction costs targeted enforcement—the practice of monitoring some firms more closely than others—is neither necessary nor desirable. In the presence of constant marginal transaction costs, buyers of permits should be monitored more closely than sellers, but within groups of buyers and sellers monitoring should be uniform. When marginal transaction costs are not constant, effective monitoring will depend on whether a ...


Levels, Differences And Ecms – Principles For Improved Econometric Forecasting, P. Geoffrey Allen, Robert Fildes Jan 2004

Levels, Differences And Ecms – Principles For Improved Econometric Forecasting, P. Geoffrey Allen, Robert Fildes

PERI Working Papers

An avalanche of articles has described the testing of a time series for the presence of unit roots. However, economic model builders have disagreed on the value of testing and how best to operationalise the tests. Sometimes the characterization of the series is an end in itself. More often, unit root testing is a preliminary step, followed by cointegration testing, intended to guide final model specification. A third possibility is to specify a general vector autoregression model, then work to a more specific model by sequential testing and the imposition of parameter restrictions to obtain the simplest data-congruent model ‘fit ...


Attitudes Towards Alternative Management Policies For Public Recreation Lands, Mihail Samnaliev, Thomas Stevens, Thomas More Jan 2004

Attitudes Towards Alternative Management Policies For Public Recreation Lands, Mihail Samnaliev, Thomas Stevens, Thomas More

PERI Working Papers

Public recreation land management agencies have been searching for ways to increase revenue. User fees as implemented by the Fee Demonstration Program have received the most attention. Corporate sponsorships and private donations have also been implemented and other options, such as partial privatization, closure of some areas, and different forms of public-private partnerships have been debated. The present paper reports results from a 2002 mail survey of randomly selected Idaho and New Hampshire households, designed to elicit public attitudes about a wide variety of management policies for public (federal/state) recreation lands. The most socially acceptable forms for raising revenue ...


Survey Instrument For Case Studies Of Food Safety Innovation, Elisabete Salay, Julie A. Caswell, Tanya Roberts Jan 2003

Survey Instrument For Case Studies Of Food Safety Innovation, Elisabete Salay, Julie A. Caswell, Tanya Roberts

PERI Working Papers

Firms innovate to prevent the presence of microbial pathogens in foods and to address other safety problems. To date, studies on the economics of food safety innovation are relatively rare. We designed a series of case studies of such innovation in the meat industry. Our objectives were to identify and analyze different types of innovation, the drivers of innovation, the mode of innovation development, and the impact of innovation on food safety and firm performance. Here we present the survey instrument developed to conduct the case studies. This instrument can be applied, with minor modifications to reflect research objectives, to ...


The Impact Of Reforming Wheat Importing State-Trading Enterprises On The Quality Of Wheat Imported, Nathalie Lavoie Jan 2003

The Impact Of Reforming Wheat Importing State-Trading Enterprises On The Quality Of Wheat Imported, Nathalie Lavoie

PERI Working Papers

Recent surveys of wheat importers indicate that countries that import wheat via a state-trading enterprise (STE) are less sensitive to quality issues in import decision-making than countries that import wheat through private traders. This study examines conceptually and empirically the impact of the deregulation of wheat imports on the quality and source of wheat imports.


A Comparison Of Cheap Talk And Alternative Certainty Calibration Techniques In Contingent Valuation, Mihail Samnaliev, Thomas Stevens, Thomas More Jan 2003

A Comparison Of Cheap Talk And Alternative Certainty Calibration Techniques In Contingent Valuation, Mihail Samnaliev, Thomas Stevens, Thomas More

PERI Working Papers

A field test of cheap talk and two types of certainty calibration in contingent valuation of public lands indicated that cheap talk does not reduce WTP estimates. Use of a ten point certainty calibration scale reduces WTP estimates by about half. However, adjusting for uncertainty using a ‘Not Sure’ option does not reduce WTP estimates but increases the variance in responses. There may be a conceptual difference between these two ways of accounting for respondents’ uncertainty, which may suggest why they provide different WTP value estimates and variances.


A Tale Of Two Clams: Policy Anticipation And Industry Productivity, Sylvia Brandt Jan 2003

A Tale Of Two Clams: Policy Anticipation And Industry Productivity, Sylvia Brandt

PERI Working Papers

Sound environmental regulation must achieve environmental objectives while maximizing economic efficiency. This paper evaluates the impact of regulation on efficiency by measuring annual productivity across regulatory regimes in two similar fisheries with differing policy expectations. Anticipation of regulatory change produced strategic behavior in one fishery, leading to depressed productivity; in the other, regulatory change was not expected, and productivity did not suffer. These results imply that fisheries regulation should take into account both firms’ policy expectations and the potentially perverse incentives that may be created by policy change.


Evaluating Tradable Property Rights For Natural Resources: The Role Of Strategic Entry And Exit, Sylvia Brandt Jan 2003

Evaluating Tradable Property Rights For Natural Resources: The Role Of Strategic Entry And Exit, Sylvia Brandt

PERI Working Papers

This paper presents an econometric approach to the evaluation of environmental regulation using tradable property rights. Existing empirical research on this issue, which compares overall industry efficiency before and after the introduction of new regulations, conflates two distinct phenomena: efficiency changes due to exit of excess capital, and changes in the efficiency of individual firms. Because the regulatory process induces firms of different types to enter and exit the industry at different rates, the true efficiency and equity effects of tradable property rights cannot be assessed without correcting for these changes in sample composition. This paper examines the impact of ...


A Meta-Analysis Of Hypothetical Bias In Stated Preference Valuation, James J. Murphy, Geoffrey Allen, Thomas H. Stevens, Darryl Weatherhead Jan 2003

A Meta-Analysis Of Hypothetical Bias In Stated Preference Valuation, James J. Murphy, Geoffrey Allen, Thomas H. Stevens, Darryl Weatherhead

PERI Working Papers

Individuals are widely believed to overstate their economic valuation of a good by a factor of two or three. This paper reports the results of a meta-analysis of hypothetical bias in 28 stated preference valuation studies that report monetary willingness-to-pay and that used the same mechanism for eliciting both hypothetical and actual values. The papers generated 83 observations with a median value of the ratio of hypothetical to actual value of 1.35, and the distribution has severe positive skewness. Since a comprehensive theory of hypothetical bias has not been developed, we use a set of explanatory variables based on ...


Mechanisms For Addressing Third Party Impacts Resulting From Voluntary Water Transfers, James J. Murphy, Ariel Dinar, Richard E. Howitt, Erin Mastrangelo, Stephen J. Rassenti, Vernon L. Smith Jan 2003

Mechanisms For Addressing Third Party Impacts Resulting From Voluntary Water Transfers, James J. Murphy, Ariel Dinar, Richard E. Howitt, Erin Mastrangelo, Stephen J. Rassenti, Vernon L. Smith

PERI Working Papers

This paper uses laboratory experiments to test alternative water market institutions designed to protect third party interests. The institutions tested include taxing mechanisms that raise revenue to compensate affected third parties and a market in which third parties actively participate. The results indicate that there are some important trade-offs in selecting a policy option. Active third party participation in the market is likely to result in free riding that may erode some or all of the efficiency gains, and may introduce volatility into the market. Taxing transfers and compensating third parties offers a promising balance of efficiency, equity and market ...