THE DEMAND FOR EXCESS RESERVES, LIABILITY MANAGEMENT, AND THE MONEY SUPPLY PROCESS

Commercial bank behavior is not adequately dealt with in existing macro models of the financial sector. The central role of a demand for excess reserves (or free reserves) function in models of the money supply process is particularly suspect. In this paper, it is argued that changes in commercial bank behavior induced by alterations in economic and financial conditions and various banking regulations, along with the central bank's approach to policy, have combined to alter the excess reserve function and the relationship between bank reserves and the money supply. Empirical work presented suggests that the "demand" for excess reserves has indeed undergone structural change. Thus, the study indicates that conventional approaches to commercial bank behavior and the demand for excess reserves need to be reworked.     

Coupling ecosystem services supply and human ecological demand to identify landscape ecological security pattern: A case study in Beijing–Tianjin–Hebei region,China

Landscape ecological security pattern (LESP) can effectively safeguard urban ecological security, which is vital for urban sustainable development. Previous studies have not adequately considered the ability to fulfill people’s demand for ecosystem services when identifying sources of LESP. To address this gap, we sought to develop a more comprehensive approach coupling ecosystem services supply and human ecological demand to construct LESP for Beijing–Tianjin–Hebei region. We proposed a new evaluation framework integrating ecosystem services importance assessment and landscape connectivity analysis with human ecological demand importance assessment to identify ecological sources. Afterwards, ecological corridors were identified using Minimum Cumulative Resistance model based on sources and resistance surface modified through nighttime light data. Combined with ecological sources and corridors, LESP for Beijing–Tianjin–Hebei region can be constructed. The ecological sources are mainly located in western Beijing and southwestern Chengde. The ecological source area totals 36,245.50 km², accounting for 21.26% of the ecological land in Beijing–Tianjin–Hebei region. The ecological corridors cross the whole region, from northeast to southwest, similar to the direction of the Yanshan–Taihang Mountain Chain. All the national nature reserves and 91.4% of the provincial nature reserves are distributed within the LESP. The validity of our methodology is confirmed by the distribution of the nature reserves. This study adds new insights into the methodology of LESP construction, and its results provide information about local ecological characteristics that can provide an important reference for decision-making concerning urban planning and ecological conservation.     

Municipal residency laws: Effects on police employment,compensation, and productivity

This paper offers an alternative model of the effects of residency laws in municipal labor markets. Unlike previous studies, the model assumes that public employee labor markets are characterized by conditions of excess supply and that public services are produced under noncompetitive conditions. The model also implies that productivity improvements increase rather than reduce labor demand, yielding different results with respect to the wage and employment effects of residency requirements. The non-clearing market model is tested using data on municipal police officers. The results are more compatible with the disequilibrium model than with models based on a competitive equilibrium.     

Gambling as a rational addiction

This paper applies the Becker-Murphy model of rational addiction to gambling and tests the hypotheses of the model empirically using data on pari-mutuel betting at horse tracks from 1950 through 1987. Gambling demand equations which explicitly account for the fact that gambling is an addictive behavior are derived from the Becker-Murphy theoretical model of rational addictive behavior. The effectiveness of changing the takeout rate, the price variable, on gambling behavior, is examined within the addictive framework. Using instrumental variables techniques, gambling demand equations are estimated, with the results supporting the hypothesis of model of rational addictive behavior. In particular, significant inter-temporal linkages are found in gambling consumption, confirming the assumption that gambling is addictive. Future events are found to have a significant impact on current consumption, implying that individuals are not behaving myopically. The long run price elasticities of demand implied by the estimates obtained for the addictive demand equation for handle per attendee is approximately –0.68, significantly larger (by approximately a third) than those obtained from demand equations estimated under the hypothesis of nonaddictive behavior (with an elasticity of –0.454). This reaffirms that the takeout rate is an effective policy instrument for state governments as they set the price of gambling.The author wishes to acknowledge the assistance of Michael Grossman and Frank Chaloupka. Comments and insights on early drafts of this paper from Gary Becker, Kevin Murphy, Robert Cherry, Alice Hughey, and William Eadington are appreciated and have improved the final product. Peggy Hendershot (Thoroughbred Racing Commission), and Terri LaFleur (Gaming and Wagering Business Magazine) made the job of collecting data for this study a manageable task. Also, thanks goes to Eugene Martin Christiansen for spending hours explaining terms and giving me direction, in an untiring and supportive manner. The research assistance of Christopher Mobilia and Allan Markowitz is appreciated. The views expressed, along with any errors are those of the author.     

A CLOSER LOOK AT LONG‐RUN U.S. MONEY DEMAND: LINEAR OR NONLINEAR ERROR‐CORRECTION WITH M0, M1, OR M2?

We study annual U.S. data from 1869 or 1900 to 1999. We find evidence for a well-specified and stable model of money demand with data from 1946 to 1999. We carry out diagnostic and stability tests, including linearity tests. A linear error-correction model with the monetary base performs better than a model with M1. A specification with M2 is not supported. We use real gross national product as the scale variable and a short-term interest rate as the opportunity cost measure. We estimate an income elasticity of 0.86 and an interest rate elasticity of −0.44 for the monetary base . ( JEL E41)     

A BANDWAGON EFFECT IN PERSONALIZED LICENSE PLATES?

The bandwagon effect is a consumption externality that exists when an individual's demand for a good is increased by his observation of other consumers using that good. This paper models a product demand curve with a bandwagon effect and, using data on sales of personalized license plates, estimates such a demand curve. Certain more conventional models of product demand, including information diffusion and habit formation models, are observationally similar to the bandwagon model, despite being conceptually different from it. I attempt to use the license plate data to discriminate between the bandwagon model and these other models.     

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)     

试析中国与沙特阿拉伯的石油合作

沙特阿拉伯是世界第一大原油生产国和出口国,中国是世界第二大石油消费国和消费量增长最快的石油进口国.沙特需要为其巨大的能源储量寻找新的市场,中国需要海外能源满足经济增长的需要.因此,两国在能源领域存在着相互依赖关系.正是这种相互依赖关系推动着中沙关系的稳步发展,本文力图运用政治经济学的分析法对中沙石油合作做出理性分析与判断.     

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.     

Labor Markets and the Process of Income Attainment in the Multimedia Age

Abstract  This paper examines several foreseeable scenarios about the effects of information technology on the labor market and the process of individual's income attainment. While I do not intend to exclude other factors, I argue that computer literacy and information literacy are two distinct but complimentary factors, and that they will be the two critical issues in determining the productive capacities of workers in the multimedia age. I view information literacy as a firm-specific skill, and argue that it will be the key factor in determining the production function of workers within the firm. Computer literacy is viewed as the endowment of information literacy skills. Workers with higher levels of computer literacy will be at an advantage at the time of labor market entry. Further, such workers are more likely to have higher rates of return on firm's investments in information literacy skills. thereby yielding higher productions. Based on the premise that information technology and labor are complementary components which should reveal an increase in the demand for higher skilled workers, I suggest that income differences are likely to widen along the lines of educational attainment and establishment-size. The "Implications" section (V) of the paper examines several issues for further research in this incipient field of sociology.     

Cointegration and Structural Change: An Application to the U.S. Demand for Money

I perform the cointegration tests for the trivariate model of real monetary aggregates, real personal income, and short‐term interest rate. I find the existence of a long‐run relationship among these three variables. To check the stability of a long‐run money demand relationship, I implement a rank constancy test and CUSUM test. The test results show that real M1 is relatively more stable than other aggregates, but structural change occurred during the 1970s and early 1980s. This is consistent with prior research on money demand.     

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.     

STATE ABORTION LEGISLATION AS A PUBLIC GOOD—BEFORE AND AFTER ROE V. WADE

This paper develops a theoretical model of the public demand for abortion legislation, taking account of two possible types of demand, external and private. All voters possess an external demand for abortion legislation whereas only those voters who could potentially have an abortion possess a private demand. We estimate the public demand for abortion legislation using state-level data prior to Roe v. Wade, and then predict the likely outcome for each state should Roe be overturned. Our predictions suggest that the country as a whole is unlikely to return to as restrictive an environment as existed pre-Roe.     

MODELING MONETARY TRENDS IN ITALY USING HISTORICAL DATA: THE DEMAND FOR BROAD MONEY 1861—1990

In this paper we estimate a stable demand for money relationship for Italy using a long series of historical data. We extend previously available data sets to obtain a sample for the years 1861 to 1990 and use cointegration analysis and two-stage estimation procedures to obtain a dynamic model for M2 demand. By employing a small number of explanatory variables and a nonlinear error-correction model we find a stable demand for money relationship. Our model incorporates significant inflation and interest rate effects, in contrast to previous studies of this type.     

HEALTH CARE INFLATION AND ITS IMPLICATIONS FOR MONETARY POLICY

Motivated by recent findings on the cyclical movement of both health and health spending, we construct a general equilibrium model that distinguishes health care demand from the demand for other goods. Using this model, we are able to generate inflation dynamics and cyclicality of health that match the US data. When the model is subjected to an expansionary monetary policy shock, it yields different output and inflation responses compared with a two‐sector model with homogeneous demand. We show that the trade‐off between leisure and health spending plays an important role in model dynamics. The model further predicts different degrees of inflation stabilization across sectors when a shift in the monetary policy occurs. (JEL E52, E31, E32, I10)     

The Advantage of Activity-based Modelling for Air-quality Purposes: Theory vs Practice and Future Needs

Activity-based modelling treats travel demand as derived from the demand for activities. This approach has important advantages for emissions and air-quality analyses. An ideal activity-based model will describe the chain of activities in which each person in the household is involved during the day. The information on an activity includes the location, start and end times, mode of travel and travel time. Such a model, together with a traffic micro-simulation application, can provide perhaps the best information needed for an analysis and evaluation of emissions and air-quality benefits of transportation control measures. The article describes the advantages of activity-based modelling for emissions and air-quality analysis and evaluates the feasibility of practical applications to provide this type of benefits. The first application of an activity-based model in the USA is examined. Its advantages for emissions and air-quality analyses are evaluated against the traditional four-step model and with ideal activity based models.     

DEMAND FOR NATIONAL PUBLIC GOODS: ESTIMATES FROM SURVEYS

This paper presents an empirical method of estimating aggregate demand functions for national public goods. The technique combines survey responses and tax incidence figures in a probit model. The model provides estimates of average willingness-to-pay for federal government services and simultaneously regresses these estimates on socioeconomic characteristics, thus obtaining estimates of the demand function. The main findings are that demand for defense, space, foreign aid, welfare, education and aid to cities is a concave function of income, a negative function of expenditure level (generally) and dependent upon such characteristics as race, age, education level, and sex.     

国际收支结构变动的理论和实践及其对中国的政策含义

国际收支平衡问题主要是围绕经常项目的平衡来展开。经常项目里主要有贸易项和投资收入项。根据国际收支克劳瑟模型理论,一国在发展过程中要经历不同阶段,随着一国国民收入水平的变化,这个国家的国际收支将发生一系列的变化。美国和亚洲国家国际收支情况的演变过程,基本符合克劳瑟模型理论,但中国是一个例外。东南亚金融危机后,中国成为世界上最重要的资本输出国,却以投资收入逆差为代价。这不仅造成巨大的福利损失,还导致了一系列的发展难题。中国应考虑是否还要继续充当资本输出国和继续积累外汇储备。     

Running on Empty: The Operating Reserves of U.S. Nonprofit Organizations

Operating reserves allow nonprofit organizations to smooth out imbalances between revenues and expenses, helping to maintain program output in the presence of fiscal shocks. We know surprisingly little about why nonprofits might save operating reserves and what factors explain variation between organizations' savings behavior. Findings suggest that operating reserves are reduced in the presence of concentrated public funds, access to debt, fixed assets, and endowment. However, size is not an important predictor, indicating that the lack of reserves is not limited to small nonprofit organizations but is instead a sectorwide issue. Significant numbers of nonprofits maintain no operating reserves at all. One potential explanation is that organizations discount the benefits of reserves because they are evaluated on spending, focusing instead on the “benefits of costs.” This preference for spending over reserving may also help explain the general lack of liquidity in the sector beyond operating reserves alone.     

FURTHER RESULTS ON EQUILIBRIUM PATTERNS OF COMPETITION IN OCS LEASE SALES

A prior model of competitive bidding for offshore petroleum leases is subjected to more extensive empirical testing based on underlying geological data prepared by the U.S. Geological Survey. The current results strongly reinforce the tentative conclusions advanced in the previous paper, and demonstrate the robustness of the model. In light of the current results, it seems very likely that participants in offshore lease sales behave as if their operations were constrained physically such that only a limited volume of petroleum reserves are pursued in any one sale.