CRIMINAL DETERRENCE IN THE REDUCED FORM: A NEW PERSPECTIVE ON EHRLICH'S SEMINAL STUDY

Ehrlich [1973] is perhaps the best known and most influential study of criminal deterrence. Ehrlich's structural estimation of a three-equation simultaneous system found large and significant direct deterrent effects of penalties on crime rates. However, recent theoretical results show that higher penalties may indirectly increase crime rates by reducing the probability of conviction. Hence, a reduced-form model is needed to learn the total effect of penalties on crime rates. Using such a model, we find that the marginal deterrent effects reported by Ehrlich vanish. This result generates much different policy implications than those widely adopted following Ehrlich's publication.     

The best interests of the child? The role of the court welfare officer

SUMMARY. The current developments in practice, where children are involved with the courts, will form a fundamental part of work with children under the 1989 Children Act. One of the key actors will be the Court Welfare Officer, part of the Probation Service. This article reviews the role as it has developed in recent years, pointing out the different practices which coexist, even in the same area. Using evidence from a small scale research study in one Service, the article argues for a clearer and more consistent role, which can only really develop under a Family Court Welfare Service     

IS LAND LEASING A SOLUTION TO UNAFFORDABLE HOUSING?

The increase in U.S. mortgage rates from nine per cent in 1976 to fifteen per cent in 1982 raised monthly mortgage payments by about sixty per cent, even before rising house prices in the United States over this period are taken into account. Not surprisingly, attention has been focused on ways and means of counteracting spiralling housing costs. One proposed solution is land leasing. Under such an arrangement, the homebuyer purchases the house but leases the land. (There may be an option to buy the land at some time in the future.) Land leasing reduces the overall purchase price, and hence lowers the minimum down-payment and the initial monthly mortgage payment. In Hawaii, land leasing has been a readily available alternative to land owning throughout the postwar period. The analysis of residential housing prices in Hawaii provides some quantitative estimates of the relative prices of leasehold versus fee simple properties. The average price differential is surprisingly small. One explanation of these small price differentials, for which a model is developed and tested here, is that borrowing-constrained households use high discount rates to calculate the present value of the future land price that they will, in effect, have to pay at the expiration of the lease. These discount rates are estimated in a nonlinear hedonic property price equation. The results are then employed to answer the question: Under what conditions would a leaseholder buy the land outright before the expiration of the lease?     

EMPLOYEE EVALUATION OF PENSION CLAIMS AND THE IMPACT OF INDEXING INITIATIVES

There is discussion in both Canada and the United States of proposals which require private pension plans to provide indexed pension benefits. This paper employs both an auction and an implicit contract model to identify the compensating wage differentials required of possible policy initiatives. The contract model, motivated by the prevalence (especially in Canada) of ad hoc cost-of-living adjustments to pensions in pay, presumes that workers have a call option on the investment earnings in excess of the interest rate assumption used to value the plan. The analysis indicates that wage offsets are potentially quite large, may be difficult to predict, and may vary substantially across firms. In addition, the case for policy action would appear to rest largely on the implicit assumption that workers misperceive the value of their pension benefits.     

INVESTIGATING THE CAUSAL RELATIONSHIP BETWEEN QUITS AND WAGES: AN EXERCISE IN COMPARATIVE DYNAMICS

This paper examines the causal relationship between wages and quits in U.S. manufacturing industries. Logit and regression models then relate causality test results to industrial characteristics. Once these relationships are identified, they can be used to predict the causality classification for each industry, based on the characteristics of that industry. This technique can help the researcher choose the appropriate theoretical model for analysis. One finding is that quits respond to wages in most industries, but not in industries with highly skilled workforces.     

AN ANALYSIS AND DISCUSSION OF THE OPTIMIZED PRODUCTION TECHNOLOGY SOFTWARE AND ITS USE

During the 19805 much attention, both pro and con, was directed toward optimized production technology (OPT). Criticism was directed at the proprietary nature of the scheduling algorithms within the software. Despite these criticisms, many large companies installed OPT. Little has been written on how the software is constructed and operates. This article introduces the software, provides a discussion of how it interfaces with management, and how various algorithms are imbedded in the software function. Last, a survey of companies that had implemented the software revealed that the major users are in the automotive industry.