AN ECONOMETRIC MODEL OF THE DEMAND FOR CHILD CARE

Child care denotes any arrangement used by a working parent for care of a child, including self-care. This paper is concerned with the factors that influence the demand for market modes of child care by two parent families with working mothers. An econometric model is specified that relates the demand for child care to price, income, and other economic variables. Because of the discrete nature of the child care decision, the multinomial logit probability model is used to analyze the data. The empirical results suggest that the demand for child care is sensitive to both prices and income.     

AN EXPLORATORY MODEL OF THE SIZE DISTRIBUTION OF INCOME

Through a specific model, this paper explores a promising general framework for unified modelling of the size distribution of income and wealth. The specific model includes physical and human capital accumulation, factoral and size distribution effects, redistributive taxation, economic growth, and other distribution-related mechanisms. The main conclusion is that the general framework can accommodate a wide range of distributional phenomena and still remain analytically tractable. Specifically, the framework allows closed form analytic solution for the first two moments (mean vector and variance-covariance matrix) of the joint distribution over individuals of income, wealth, and other variables.     

AN ECONOMIC ANALYSIS OF THE DEMAND FOR ABORTIONS

This study uses an economic model of fertility control to estimate the demand for abortions. The results show that the fundamental law of demand holds for abortions, with the price elasticity of demand equal to –.81. Abortions are a normal good with an income elasticity of demand equal to .79. The demand for abortions is also positively related to the labor force participation of women and to being unmarried. Catholic religion, education and the poverty status of women were found to have no statistically significant impact on the demand for abortions.     

THEORY-BASED MEASUREMENT OF THE SAVING-INVESTMENT CORRELATION WITH AN APPLICATION TO NORWAY

The work of Feldstein and Horioka has stimulated much research on the correlations of national savings and investment rates and their relation to the degree of international capital mobility. Theory implies a cointegrating relation between these variables, which suggests this correlation is measured best by an error correction model. This model includes all previous specifications as special cases, which we show are potentially misspeced on theoretical grounds. Applied to Norway, our model outperforms prevailing specifications. We detect structural breaks, and find the correlation's time profile is consistent with other indicators of capital mobility.     

THE DEMAND FOR CASINO GAMING WITH SPECIAL REFERENCE TO A SMOKING BAN

This study adds to the limited literature on the demand for casino gaming. The major focus is on the effect of a statewide smoking ban. A system of slot machine demand equations, one each for the three Delaware racinos (racetrack casinos), was developed. The number of slot machines at a racino, at competing in-state racinos, and income were significant demand determinants. Competing out-of-state gaming venues had insignificant effects on gaming demand over the study period. The smoking ban had a significant negative impact on demand, which was not significantly different across the three racinos. The smoking ban reduced gaming demand 15.9%. ( JEL L83)     

AN EXTENSION OF LERNER'S MONOPOLY INDEX FOR MARKETS WITH A DISPARITY BETWEEN LONG- AND SHORT-RUN DEMAND ELASTICITIES

This paper develops a theoretical analysis of steady state monopoly pricing in markets with a disparity between long- and short-run demand elasticities, based on a separation between the long-run demand schedule and the adjustment process that underlies actual demand levels. This sheds light, in a practical context, on the impact of the speed of adjustment and the firm's discount rate on its equilibrium markup; and on the measurement of realized monopoly power. An illustrative application of the analysis to existing empirical data supplements the theoretical presentation.     

AN ALTERNATIVE TO MANAGED CARE: A GUILD MODEL FOR THE INDEPENDENT PRACTICE OF PSYCHOTHERAPY

As health care is reconfigured by HMOs and managed care organizations, family therapists often have to decide whether or not to cooperate with the new power structures and their ways of doing things. The chief concern of many therapists is the ehtical bind created when the managed care orgranization demands breaches of confidentiality or makes decisions about the course of treatment that may not, in the therapist's opinion, be in the best interest of the family. Associations of independent, nonmanaged care psychotherapists are springing up in response to these dilemmas. This paper describes the philosophical evolution and organizational development of one such association.     

OFFSHORING AND THE POLARIZATION OF THE DEMAND FOR CAPITAL

In the past decades, the importance of different capital goods has gradually changed, which has led to a structural shift in the composition of the demand for capital at the expense of more traditional capital inputs such as machinery and equipment. In this paper, we focus on a novel driver of this development by analyzing the effect of offshoring on the demand for capital by asset class using a rich country-sector panel dataset. Estimating a system of factor demand equations, we document that offshoring reduces the relative demand for non-ICT capital, thereby polarizing the demand for capital. (JEL F14, F62, E22)     

THE CHALLENGE OF REVENUE SHARING WITH BUNDLED PRICING: AN APPLICATION TO MUSIC

Although bundling can substantially increase profits relative to standalone pricing, particularly for zero‐marginal‐cost information products, it has one major problem: bundling produces revenue that is not readily attributable to particular pieces of intellectual property, creating a revenue division problem. We evaluate several possible solutions using unique song valuation survey data. We find the Shapley value, a well‐motivated theoretical solution, is universally incentive compatible (all bundle elements fare better inside the bundle than under standalone pricing), but revenue‐sharing schemes feasible with readily available consumption data are not. Among feasible schemes, Ginsburgh and Zang's modified Shapley value performs best. (JEL C71, D79, L14)     

A CHOICE THEORETIC MODEL OF THE OPTIMAL USE AND ISSUANCE OF TRADE CREDIT

This paper develops an extended inventory theoretic model for the purpose of analyzing the optimal use and issuance of trade credit. One significant result is that the incentives payments costs associated with commodity transactions and from the existence of positive per unit cost associated with storing commodities. A further important result is that the cost charged by the firm in return for its issuance of credit consists in firm earning asset holdings, and a risk premium reflecting the possibility of default on the part of the household.     

GOVERNMENT DEBT AND THE DEMAND FOR MONEY: AN EXTREME BOUND ANALYSIS

The article provides evidence that there is a relationship between government debt and interest rates via the demand for money. This relationship is examined through the wealth effect of government debt on money demand, and the robustness of the results is tested by the use of extreme bound analysis in addition to standard econometric techniques. We find that OLS regression shows government debt fnfecting the demand for money positively, implying that Federal government debt is net wealth. In addition, the extreme bound analysis shows that the estimates of the government debt coefficient are robust under alternative specifications of the Goldfeld model.     

A SEMIPARAMETRIC DISCRETE CHOICE MODEL: AN APPLICATION TO HOSPITAL MERGERS

We propose a computationally simple semiparametric discrete choice estimator to model rich consumer heterogeneity. We assume groups of observably similar consumers have similar preferences, but allow preferences to vary freely across these groups. Model flexibility is easily adjusted by setting a single tuning parameter; we suggest a cross‐validation method to do so. We analyze the model's properties in the context of hospital mergers, both analytically and via a Monte Carlo analysis. The model performs well for policy relevant substitution and welfare measures, even if misspecified, when the tuning parameter is set within the neighborhood of the value chosen by cross validation. (JEL C14, D12, I11, L41)     

ELEMENTARY SCHOOL STUDENTS' EXTRACURRICULAR ACTIVITIES: THE EFFECTS OF PARTICIPATION ON ACHIEVEMENT AND TEACHERS' EVALUATIONS

ABSTRACT

I use data from the Early Childhood Longitudinal Study to examine both the number and the types of extracurricular activities in which elementary school students participate and find significant differences in participation patterns by gender, race, and class. The number of activities in which students participate during kindergarten and first grade affects their gains in reading achievement test scores between first and third grade and third grade teachers' evaluations of mathematics skills, but does not affect gains in math achievement test scores or teachers' evaluations of language arts skills. Dance lessons, athletic activities, and art lessons, in particular, affect one or more of the dependent variables. With one exception, interactions of extracurricular activities with socioeconomic status show that less-privileged children benefit more from participation in activities than do more-privileged children, providing evidence against Bourdieu's theory of cultural capital and social reproduction.     

INFERENCE USING QUALITATIVE AND QUANTITATIVE INFORMATION WITH AN APPLICATION TO MONETARY POLICY

I propose a framework for drawing inferences about an unobserved variable using qualitative and quantitative information. Using this framework, I study the timing and persistence of monetary policy regimes and compute probabilistic measures of the qualitative indicator's reliability. These estimates suggest that (1) it is over one and one-half times more likely that monetary policy is not restrictive at any point in time, (2) Boschen and Mills's [1995] policy index is a reliable indicator of the stance of monetary policy, and (3) certain qualitative indicators of monetary policy improve interest rate forecasts that are based on linear forecasting models. (JEL C22, E52)     

CROSS-COUNTRY ESTIMATES OF THE DEMAND FOR MONEY AND ITS COMPONENTS

The demand for money aggregates (M1, M2) and their components (currency, demand deposits, and time deposits) are estimated using a sample of 103 countries at two time periods. Money demand is found to be affected by age, literacy, industrial development, and political structure, as well as income and inflation. This expanded demand function helps to explain the considerable changes in money demand that have occurred over long periods and the large variation in money demand found across countries. The knowledge thus gained is useful for understanding differences in monetary and taxation policies across countries.     

A CROSS-SECTION ANALYSIS OF THE DEMAND FOR NEW AND USED AUTOMOBILES IN THE UNITED STATES

This paper investigates the effects of income and other family characteristics on the demand for new and used automobiles. The multinomial logit probability model is employed to explain a family's choice of age and number of automobiles. Two cross-section surveys are analyzed to ascertain how well these components of demand can be explained by socio-economic variables.     

A HUMAN CAPITAL MODEL OF THE EFFECTS OF ABILITY AND FAMILY BACKGROUND ON OPTIMAL SCHOOLING LEVELS

This paper develops a theoretical model of optimal schooling levels where ability and family background are the central explanatory variables. We derive schooling demand and supply functions based on individual wealth maximization. Using the National Longitudinal Survey of Youth 1979 data, we stratify our sample into 1-yr full-time equivalent (FTE) work experience cohorts for 1985–1989. The estimated Mincerian "overtaking" cohort (the years of work experience at which individuals' observed earnings approximately equal what they would have been based on schooling and ability alone) corresponds to 13 FTE years of experience, yielding on average a rate of return of 10.3% and an average (optimal) 11.4 yr of schooling. ( JEL J24, J31, J22)