Title: "Pacific Conference for Development Economics" (PACDEV)

Friday, September 19, at 11:00 - 12:30, HSS 147, Luca Bossi, University of Miami

Title: "Optimal Second Best Taxation of Addictive Goods"

Abstract

In this paper we derive conditions under which optimal tax rates for addictive goods
exceed tax rates for non-addictive consumption goods in a rational addiction framework
where exogenous government spending cannot be financed with lump sum taxes. Standard
static models that consider a revenue raising motive predict taxing addictive goods at a rate
in excess of that observed in the data. In contrast, our dynamic results imply tax rates
on addictive goods which are smaller than tax rates implied by the static framework. This
is the case because high current tax rates on addictive goods tend to reduce future tax
revenues, by making households less addicted in the future. Finally, we consider features of
addictive goods such as complementarity to leisure that, while unrelated to addiction itself,
are nonetheless common among some addictive goods. In general, such effects are weaker in
our dynamic setting since if taxing addictive goods has strong positive revenue effects today,
then taxing goods has a strong of setting effect on future tax revenues.

Thursday, March 20, at 12:00 - 13:30, in HSS 143, Enchuan Shao, SFSU

Title: "Money and Barter under Private Information"

Abstract

This paper examines the role of money when private information about the

quality of the goods is present. In the private information environment, barter

exchange for high-quality goods is rare since people have incentive to produce

low-quality goods and attempt to cheat uninformed trading partners. This en-

vironment gives money a role in mitigating informational frictions. I consider

two environments, one where traders can signal their quality of goods and one

where they cannot, and two types of informational problems - adverse selection

and moral hazard - in a search-theoretic framework. Both environments sup-

port the notion that money reduces the adverse selection problem and increases

welfare. However, with moral hazard, money is less effective in overcoming in-

formational frictions. Because low-quality goods producers can still consume

as long as they hold money even when their products are recognized as low

quality, agents have incentive to produce low-quality goods. I conduct several

policy analyses, and find that the role of money is very sensitive to the inflation

rate. While the Friedman rule is the optimal monetary policy in my environ-

ment, it cannot generate a first-best allocation unless traders are able to signal

their quality of goods.

Friday, April 4, at 12:00 - 13:00, in HSS 361, Edoh Amiran, Western Washington University

Title: "The Sensitivity of Sensitivity to Scope in Valuing Public Goods"

Abstract

Sensitivity to scope is understood to describe the amount a consumer would pay for a portion of an increase in a good relative to the whole increase. In many studies in environmental economics it is possible to measure sensitivity to scope and it has been suggested that small sensitivity to scope is an indication of poor methodology or of deceptive reporting by consumers. Alternatively, it has been suggested that small sensitivity to scope is further evidence of the limitations of rational models of behavior.

In this study we define sensitivity to scope in terms of models of utility and examine its size and its potential variation with changes in key variables such as the initial endowment. It turns out that prior bounds for sensitivity to scope are, in general, absent, but that its size does suggest certain types of utility models and initial endowments. Thus small sensitivity to scope can be explained by rational models of behavior, and is consistent with accurate reporting by consumers. Of course, many alternative explanations are also available, and deciding among them remains interesting.

3. Monday, April 7, 11.00-12.30 in HSS 361, Prof. Sailabala Devi, Centre for Multi Disciplinary Development Research (CMDR), Dharwad, Karnataka, India

Title: "Spatial Distribution of Health Workforce and Health Care Services: An Inter and Intra Country Analysis"

Abstract coming soon

Friday, April 25, at 12:00 - 13:00, in HSS 361, David Pieper, SFSU

Title: "State‐Level Tobacco Control Programs and the Demand for Cigarettes: A Retrospective Analysis Using Panel Data"

Abstract

State‐level tobacco control programs in the U.S. are often funded by cigarette taxes, which are themselves an important policy tool. This study uses econometric analysis of panel data to show that the long‐term impact of these taxes on cigarette sales is significantly greater than the impact arising through the effect on prices alone, and that this distinct impact increased during the 1989‐2005 time period. The tax effects on demand could be caused by the funding of anti‐smoking programs, signaling or alternative sources of supply. The increasing size of the tax effect gives an indication that tobacco control programs are becoming more effective at achieving their goals over time as they gain critical mass.

Fall 2007 Events

Seminars

Tuesday, January 22, 10:00, in HSS 361, Guohua Feng, University of Calgary, Job Market Talk

Title: "Efficiency, Technical Change, and Returns to Scale in Large U.S. Banks: Panel Data Evidence Based on Bayesian Estimation of the Output Distance Function"

Abstract

This paper provides parametric estimates of technical change, efficiency change,
economies of scale, and total factor productivity growth for large banks (those with as-
sets in excess of $1 billion) in the United States, over the period from 2000 to 2005. In
doing so, we propose a distance function based primal total factor productivity growth
index, which is valid under both perfect and imperfect competition, and estimate the
output distance function, subject to theoretical regularity, within a Bayesian frame-
work. The results show that total factor productivity of the large U.S. banks grew at
an average rate of 1.98% over the sample period. However, our estimates also show
a clear downward trend in the growth rate of total factor productivity and our de-
composition of the primal Divisia total factor productivity growth index into its three
components - technical change, efficiency change, and economies of scale - indicates
that technical change is the driving force behind this decline.

Wednesday, January 23, 9:30, in HSS 361, Audrey Fang, UC Irvine, Job Market Talk

Title: "A DISCRETE-CONTINUOUS MODEL OF HOUSEHOLDS’ VEHICLE CHOICE AND USAGE, WITH AN APPLICATION TO THE EFFECTS OF RESIDENTIAL DENSITY"

Abstract

This paper develops a new method to solve multivariate discrete-continuous problems and
applies the model to measure the influence of residential density on households’ vehicle fuel efficiency
and usage choices. Traditional discrete-continuous modeling of vehicle holding choice
and vehicle usage becomes unwieldy with large numbers of vehicles and vehicle categories. I
propose a more flexible method of modeling vehicle holdings in terms of number of vehicles
in each category, using a Bayesian multivariate ordinal response system. I also combine the
multivariate ordered equations with Tobit equations to jointly estimate vehicle type/usage demand
in a reduced form, offering a simpler alternative to the traditional discrete/continuous
analysis. Using the 2001 National Household Travel Survey data, I find that increasing residential
density reduces households’ truck holdings and utilization in a statistically significant
but economically insignificant way. The results are broadly consistent with those from a model
derived from random utility maximization. The method developed above can be applied to
other discrete-continuous problems.

Thursday, January 24, 13:30, in HSS 361, Diego Escobari, Texas A&M, Job Market Talk

Title: "PRICE DISPERSION UNDER COSTLY CAPACITY AND DEMAND UNCERTAINTY"

Abstract

This paper tests the empirical importance of the price dispersion predictions of the Prescott-Eden-Dana
(PED) models. Equilibrium price dispersion is derived in a setting with costly capacity and demand
uncertainty where different fares can be explained by the different selling probabilities. The PED models
predict that a lower selling probability leads to a higher price. Moreover, this effect is larger in more
competitive markets. Despite its applications to several important market phenomena, there exists
little empirical evidence supporting the PED models, mostly because of the difficulty of coming up
with an appropriate measure of the selling probabilities. Using a unique panel of U.S. airline fares
and seat inventories, we find evidence that strongly supports both predictions of the models. After
controlling for the effect of aggregate demand uncertainty on fares, we also obtain evidence of second
degree price discrimination in the form of advance-purchase discounts.

Friday, January 25, 13:30, in HSS 361, Sang-Yeob Lee, Ohio State University, Job Market Talk

Title: "Spatial Competition in the Retail Gasoline Market: An Equilibrium Approach Using SAR Models"

Abstract

This paper investigates the nature of competition in the retail gasoline market using a two
year panel data of weekly prices for gas stations in San Diego county. The primary dimension
of product differentiation in the retail gasoline market is spatial in the sense that a gas station’s
market power depends on the locations of all other gas stations. In contrast to previous
empirical studies, I explicitly model the fact that retail gasoline prices of all gas stations are
simultaneously determined in a spatially competitive system. I use IV methods to estimate
several spatial autoregressive (SAR) models of stations’ price reaction functions after specifying
spatial weights based on distance between stations. My results are consistent with the
spatial competition model. I also find that retail prices are heavily influenced by station’s
characteristics such as brand name and amenities. By using the SAR model I am able to
identify that the brand of competing stations and their relative geographic proximity to each
other are important factors in explaining price variation across gasoline stations, as opposed
to just the number of competing stations. I find that gas stations most intensely compete with
stations less than 1 mile away and that the intensity of competition diminishes with distance.

ECONOMICS SYMPOSIUM
Hosts: University of San Francisco
San Francisco State Univ. 
The Federal Reserve Bank of San Francisco

Date:  November 30, 2007
Time:  6:00pm-9:00pm
Location:  McLaren Center
(MCL 252), USF CAMPUS

For more details, CLICK HERE
 

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