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Agricultural and Resource Economics

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School of Education and Human Development at the University of Colorado Denver

Selected Works

2009

Articles 1 - 10 of 10

Full-Text Articles in Social and Behavioral Sciences

A Note On The Valuation Of Collective Goods: Overlooked Input Market Free Riding For Non-Individually Incrementable Goods, Philip E. Graves Jan 2009

A Note On The Valuation Of Collective Goods: Overlooked Input Market Free Riding For Non-Individually Incrementable Goods, Philip E. Graves

PHILIP E GRAVES

For at least fifty years economists have argued that vertically-aggregated marginal willingness to pay, when set equal to marginal provision cost, will result in optimal public good provision levels. This methodological approach would be expected to yield an exact analog, in terms of optimal levels of public good provision, to efficient provision of private goods in a perfect market setting. There is, however, a potentially serious flaw in the approach as actually practiced, since initial incomes are implicitly–and wrongly–taken to be optimal. From a given income, the output demand revelation problem has long been recognized–that there will be difficulty inferring …

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The Simple Analytics Of The Wta-Wtp Disparity For Public Goods, Philip E. Graves Jan 2009

The Simple Analytics Of The Wta-Wtp Disparity For Public Goods, Philip E. Graves

PHILIP E GRAVES

A robust finding in economics is that decision-makers often exhibit a much smaller dollar willingness to pay (WTP) for an item than the minimum amount that they claim to be willing to accept (WTA) to part with it. The spread between these two numbers is particularly large for public goods, raising serious public policy concerns regarding which number, if either, is appropriate for valuing such goods. A number of explanations for this phenomenon have been advanced, each perhaps of relevance in particular settings, with little consensus being achieved as to whether any explanation satisfactorily resolves the problem. A traditional utility …

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A Note On The "Union Effect" In Vsl Studies, Philip E. Graves Jan 2009

A Note On The "Union Effect" In Vsl Studies, Philip E. Graves

PHILIP E GRAVES

Viscusi and Aldy (2003) observe that “most studies of the U.S. labor market find that union affiliation is positively correlated with a greater wage-risk tradeoff while international evidence is much more mixed.” They provide several arguments as to why the risk premium might be higher for union members (marginal versus average worker preference, the quasi-public good nature of workplace safety, and better safety information for the unionized). An alternative explanation–concentration of union membership in undesirable locations–can account for both the apparent higher risk premium in union jobs in the United States and the failure to find that gap in the …

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Voodoo Multipliers Revisited: Public Policy For Recessions And Boomtimes, Philip E. Graves Jan 2009

Voodoo Multipliers Revisited: Public Policy For Recessions And Boomtimes, Philip E. Graves

PHILIP E GRAVES

There is no abstract for this brief column.

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A Note On The Design Of Experiments Involving Public Goods, Philip E. Graves Jan 2009

A Note On The Design Of Experiments Involving Public Goods, Philip E. Graves

PHILIP E GRAVES

Concern about potential free riding in the provision of public goods has a long history. More recently, experimental economists have turned their attention to the conditions under which free riding would be expected to occur. A model of free riding is provided here which demonstrates that existing experimental approaches fail to explore a potentially important real-world dimension of free riding. In a cash-in-advance economy, free riding becomes a two-stage problem, while existing experiments only address the second stage. That is, one would expect households with high demands for public goods relative to private goods to generate less income than households …

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If The Large Wta-Wtp Gap For Public Goods Is Real (And There Are Good Reasons To Think So) Conventional Welfare Measures Are Simply Incorrect, Philip E. Graves Jan 2009

If The Large Wta-Wtp Gap For Public Goods Is Real (And There Are Good Reasons To Think So) Conventional Welfare Measures Are Simply Incorrect, Philip E. Graves

PHILIP E GRAVES

A robust finding in economics is that decision-makers often exhibit a much smaller dollar willingness to pay (WTP) for an item than the minimum amount that they claim to be willing to accept (WTA) to part with it. The spread between these two numbers is particularly large for public goods, raising serious public policy concerns regarding which number, if either, is appropriate for valuing such goods. A traditional utility maximizing model is presented here that predicts–as both measures are currently calculated–that WTA will exceed WTP, quite plausibly by a substantial amount for public goods. Moreover, it is shown here that …

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The Wta-Wtp Gap And Welfare Measures For Public Goods, Philip E. Graves Jan 2009

The Wta-Wtp Gap And Welfare Measures For Public Goods, Philip E. Graves

PHILIP E GRAVES

A robust finding in experimental economics is that decision-makers often exhibit a much smaller dollar willingness to pay (WTP) for an item than the minimum amount that they claim to be willing to accept (WTA) to part with it. The spread between these two numbers is particularly large for public goods, raising serious public policy concerns regarding which number, if either, is appropriate for valuing such goods. A number of explanations for this phenomenon have been advanced, each perhaps of relevance in particular settings, with little consensus being achieved as to whether any explanation satisfactorily resolves the problem. The traditional …

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Economic Growth And Business Cycles: The Labor Supply Decision With Two Types Of Technological Progress, Philip E. Graves Jan 2009

Economic Growth And Business Cycles: The Labor Supply Decision With Two Types Of Technological Progress, Philip E. Graves

PHILIP E GRAVES

An informal model is described that leads to multiple macroeconomic equilibria as a consequence of random variation in the relative amounts of technological change for new and existing goods. The novel observation is that the rate of introduction and market penetration of new goods vis-a-vis technological advance for existing goods importantly affects the labor supply decision. A relatively rapid influx of new goods will generally increase labor supply, while relatively more technological advance for existing goods will reduce labor supply to the market. These impacts are seen to provide insights into Rostow's stages of growth. Short run variations in the …

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An Implementable Institutional Reform That Transfers Control Of Government Spending Levels From Politicians To Voters, Philip E. Graves Jan 2009

An Implementable Institutional Reform That Transfers Control Of Government Spending Levels From Politicians To Voters, Philip E. Graves

PHILIP E GRAVES

Elected representatives have little incentive to pursue the interests of those electing them once they are elected. This well-known principle-agent problem leads, in a variety of theories of government, to non-optimally large levels of government expenditure. An implication is that budgetary rules are seen as necessary to constrain politicians' tax and spending behavior. Popular among such constraints are various Balanced Budget Amendment proposals. These approaches, however, are shown here to have serious limitations, including failure to address the central concern of spending level. An alternative approach is advanced here that relies on a Coase-like mechanism that transfers control of government …

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The Economics Of Ghost Towns, Philip E. Graves, Stephan Weiler, Emily E. Tynon Jan 2009

The Economics Of Ghost Towns, Philip E. Graves, Stephan Weiler, Emily E. Tynon

PHILIP E GRAVES

The ghost towns of the American West are both intriguing historical artifacts and reflections of unique economic forces at work. In this study we develop linked labor and housing market models balancing the wages, rents, and local amenities of isolated boomtown sites to better understand the sources of such communities’ dramatic cycles. High variance boom-towns provide a unique context for investment in housing and other foundational infrastructure, leading directly to the unusually transient local development patterns seen in ghost town settings. We use Colorado-based case studies to illustrate the relevance of the model. Comparisons with more modern rural settings in …

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