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- Environmental Economics/Public Economics (22)
- Urban/Regional Economics (16)
- Amenities (9)
- Public goods (8)
- Migration (7)
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- Choice behavior (6)
- Decision making (6)
- Hedonic analysis (6)
- Equilibrium versus disequilibrium (5)
- Location (5)
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- Willingness-to-pay (5)
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- Environmental perceptions (3)
- Environmental valuation (3)
- Equilibrium (3)
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- Multi-market compensation (3)
- Public Goods (3)
- Regional economics (3)
- Sum of specific damages (3)
- Wage compensation (3)
- Chicken versus egg (2)
- Coase theorem (2)
- Compensating Variation (2)
- Decision-making (2)
Articles 1 - 30 of 42
Full-Text Articles in Social and Behavioral Sciences
Global Climate Policy Will Have Net Benefits Larger Than Anyone Thinks (And Welfare Gains, Strangely, Are Likely To Be Much Larger Yet), Philip E. Graves
Global Climate Policy Will Have Net Benefits Larger Than Anyone Thinks (And Welfare Gains, Strangely, Are Likely To Be Much Larger Yet), Philip E. Graves
PHILIP E GRAVES
As with other public goods lacking strong special interest support, global climate policy suffers from two serious theoretical flaws. The first is failure to endogenize the labor-leisure decision when conducting benefit-cost analysis. Recognition that income generated will not remain the same pre-and-post policy results in downward bias in benefit estimation. Much more importantly, there will generally be free riding in input markets in addition to the well-known output demand revelation problem. Since even households with very high marginal values cannot individually increment public goods, too little income will be generated and too much of the income that is generated will …
Implications Of Global Warming: Two Eras, Philip E. Graves
Implications Of Global Warming: Two Eras, Philip E. Graves
PHILIP E GRAVES
The purpose of the present paper is to attempt to gain insights into the implications of global warming that is anticipated in the future. In attempting to think about really long-term regional implications, it seems naïve to look at global warming without thinking about long-standing trends in other variables that would be expected to interact with climate change over time. I envision two quite different “eras,” a first filled with considerable danger of both economic and environmental collapse. But—if humanity survives the first period—a second period of great promise for humanity and the global ecosystem is likely to take place. …
Spatial Equilibrium In The Labor Market, Philip E. Graves
Spatial Equilibrium In The Labor Market, Philip E. Graves
PHILIP E GRAVES
The paper discusses two approaches to spatial equilibrium in the labor market. The more traditional approach of labor economics assumes wage differentials represent arbitrageable differences in utility, with implications 1) that migration should be toward higher wage areas and 2) that migration flows will lead to convergence in wages over space. The more recent approach of urban/regional economics follows Roback in examining the implications of assumed equilibrium in utility over space. In this view wage differentials are compensatory (along with rent differentials) for amenity variation over space. The implications for wage convergence over space are complicated, but in general there …
The Hedonic Method Of Valuing Environmental Policies And Quality, Philip E. Graves
The Hedonic Method Of Valuing Environmental Policies And Quality, Philip E. Graves
PHILIP E GRAVES
Benefit-cost analysts attempt to compare two states of the world, the status quo and a state in which a policy having benefits and costs is being contemplated. For environmental policies, this comparison is greatly complicated by the difficulty in inferring the values that individuals place on an increment to environmental quality. Unlike ordinary private goods, environmental goods are not directly exchanged in markets with observable prices. In this chapter, the hedonic approach to inferring the benefits of an environmental policy is examined.
Benefit-Cost Analysis Of Enviromental Projects: A Plethora Of Biases Understating Net Benefits, Philip E. Graves
Benefit-Cost Analysis Of Enviromental Projects: A Plethora Of Biases Understating Net Benefits, Philip E. Graves
PHILIP E GRAVES
There are many reasons to suspect that benefit-cost analysis applied to environmental policies will result in policy decisions that will reject those environmental policies. The important question, of course, is whether those rejections are based on proper science. The present paper explores sources of bias in the methods used to evaluate environmental policy in the United States, although most of the arguments translate immediately to decision-making in other countries. There are some “big picture” considerations that have gone unrecognized, and there are numerous more minor, yet cumulatively important, technical details that point to potentially large biases against acceptance on benefit-cost …
Environmental Valuation: The Sum Of Specific Damages Approach, Philip E. Graves
Environmental Valuation: The Sum Of Specific Damages Approach, Philip E. Graves
PHILIP E GRAVES
There is no abstract for this book chapter.
Benefit-Cost Analysis Of Environmental Projects: A Plethora Of Systematic Biases, Philip E. Graves
Benefit-Cost Analysis Of Environmental Projects: A Plethora Of Systematic Biases, Philip E. Graves
PHILIP E GRAVES
There are many reasons to suspect that benefit-cost analysis applied to environmental policies will result in policy decisions that will reject those environmental policies. The important question, of course, is whether those rejections are based on proper science. The present paper explores sources of bias in the methods used to evaluate environmental policy in the United States, although most of the arguments translate immediately to decision-making in other countries. There are some “big picture” considerations that have gone unrecognized, and there are numerous more minor, yet cumulatively important, technical details that point to potentially large biases against acceptance on benefit-cost …
The Hedonic Method: Value Of Statistical Life, Wage Compensation Property Value Compensation, Philip E. Graves
The Hedonic Method: Value Of Statistical Life, Wage Compensation Property Value Compensation, Philip E. Graves
PHILIP E GRAVES
There is no abstract for this book chapter.
A Note On The Valuation Of Collective Goods: Overlooked Input Market Free Riding For Non-Individually Incrementable Goods, Philip E. Graves
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 …
The Simple Analytics Of The Wta-Wtp Disparity For Public Goods, Philip E. Graves
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 …
A Note On The "Union Effect" In Vsl Studies, Philip E. Graves
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 …
Voodoo Multipliers Revisited: Public Policy For Recessions And Boomtimes, Philip E. Graves
Voodoo Multipliers Revisited: Public Policy For Recessions And Boomtimes, Philip E. Graves
PHILIP E GRAVES
There is no abstract for this brief column.
A Note On The Design Of Experiments Involving Public Goods, Philip E. Graves
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 …
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
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 …
The Wta-Wtp Gap And Welfare Measures For Public Goods, Philip E. Graves
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 …
Economic Growth And Business Cycles: The Labor Supply Decision With Two Types Of Technological Progress, Philip E. Graves
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 …
An Implementable Institutional Reform That Transfers Control Of Government Spending Levels From Politicians To Voters, Philip E. Graves
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 …
The Economics Of Ghost Towns, Philip E. Graves, Stephan Weiler, Emily E. Tynon
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 …
Optimal Public Goods Provision: Implications Of Endogenizing The Labor/Leisure Choice, Nicholas E. Flores, Philip E. Graves
Optimal Public Goods Provision: Implications Of Endogenizing The Labor/Leisure Choice, Nicholas E. Flores, Philip E. Graves
PHILIP E GRAVES
Conventional analysis of public goods provision aggregates individual willingness to pay while treating income as exogenous, ignoring the fact that we generate income to allow us to purchase utility-generating goods. We explore the implications of endogenizing the lahor-leisure decision by explicitly considering leisure demand in a model of public goods provision. We consider benefit analysis of public goods provision and find that increments of the public good will generally be under-valued using conventional analysis while decrements to the public good (rare in public good settings) will be overvalued (JELC91,D61,Q5I)
Environmental Perceptions And Environmental Reality: When More Is Less, Philip E. Graves
Environmental Perceptions And Environmental Reality: When More Is Less, Philip E. Graves
PHILIP E GRAVES
There is no abstract for this article.
Non-Optimal Levels Of Suburbanization, Philip E. Graves
Non-Optimal Levels Of Suburbanization, Philip E. Graves
PHILIP E GRAVES
Suburbanization has many causes, among which is the attempt to relocate to acquire a more desirable vector of local public goods. The traditional economists' procedure for valuing public goods involves vertical aggregation of marginal willingness to pay, at a given income level. This approach is flawed by failing to recognize that individuals will not work for goods that cannot be acquired individually with higher incomes. There will be a parallel input market failure any time there is a public good output market failure, thus the `given income' of the traditional valuation method is too low. Hence, traditional valuation methods result …
I Don't Know, Philip E. Graves
I Don't Know, Philip E. Graves
PHILIP E GRAVES
This is a non-fiction novel, titled I Don't Know. I is in three parts, the first economic (which will seem "liberal" to most), the second political (which will seem "conservative" to most), and the third theological (which will seem weird to most). I think you will find it a fun read, and feel free to distribute it at will.
The Bias Against New Innovations In Health Care:Value Uncertainty And Willingness To Pay, Surrey M. Walton, Philip E. Graves, Peter R. Mueser, Jay K. Dow
The Bias Against New Innovations In Health Care:Value Uncertainty And Willingness To Pay, Surrey M. Walton, Philip E. Graves, Peter R. Mueser, Jay K. Dow
PHILIP E GRAVES
This paper offers a model for the bias found in willingness-to-pay valuations against new treatments. For example, this bias provides an explanation for patient preferences that make it difficult for formularies to take treatments off their lists, even when newer treatments would appear to be clearly preferable. The appeal of the model, which is based on imperfect information, is that it is consistent with rational preferences and rational behavior by patients, which are necessary for standard models and methods related to decision theory, costeffectiveness, and efficiency.
Amenities And The Labor Earnings Function, Philip E. Graves, Robert L. Sexton
Amenities And The Labor Earnings Function, Philip E. Graves, Robert L. Sexton
PHILIP E GRAVES
Desirable locations are, other things equal, expected to be characterized by a mix of higher rents or lower wages. That is, if one area is more attractive than others, inmigration would occur, driving up the demand for land (hence raising rents) and increasing the supply of labor (hence lowering wages). The in-movement will continue until utility is the same across locations in equilibrium. Failing to hold constant amenities in the traditional earnings functions employed by labor economists will result, then, in omitted-variable bias if worker characteristics (years of schooling, union membership, and so on) are correlated with amenities. By way …
Amenities And Fringe Benefits: Omitted Variable Bias, Philip E. Graves, Robert L. Sexton, Michelle M. Arthur
Amenities And Fringe Benefits: Omitted Variable Bias, Philip E. Graves, Robert L. Sexton, Michelle M. Arthur
PHILIP E GRAVES
If labor is fairly mobile, as it is in the United States, one would expect that households would move from less desirable areas toward more desirable areas until all areas are equally desirable. The way that areas become equally desirable is through the impact of movers on wages and rents (and possibly "endogenous" disamenities, such as congestion or pollution). That is, as people move to desirable areas, they will increase the demand for land (raising rents) and increase the supply of labor (lowering wages); in equilibrium, the wage and rent "compensation" for the niceness of an area reveals, in dollar …
Examining The Role Of Economic Opportunity And Amenities In Explaining Population Redistribution, Peter R. Mueser, Philip E. Graves
Examining The Role Of Economic Opportunity And Amenities In Explaining Population Redistribution, Peter R. Mueser, Philip E. Graves
PHILIP E GRAVES
This paper develops a model of migration integrating equilibrium and disequilibrium components in which individuals and firms form rational expectations about future opportunities. Levels of migration are derived as functions of variations in factors influencing migrant labor demand ("economic opportunity") and migrant labor supply ("residential amenities"). The model is used to estimate the extent to which migration in the United States over the period 1950-1980 is determined by these two classes of exogenous factors.
Alternative Fishery Management Policies: Monitoring Costs Versus Catch Limits, Philip E. Graves, Robert L. Sexton, Dwight R. Lee, Steve Jackstadt
Alternative Fishery Management Policies: Monitoring Costs Versus Catch Limits, Philip E. Graves, Robert L. Sexton, Dwight R. Lee, Steve Jackstadt
PHILIP E GRAVES
There was no abstract for this brief note.
Controlling The Abandonment Of Automobiles: Mandatory Deposits Vs Fines, Dwight Lee, Philip E. Graves, Robert L. Sexton
Controlling The Abandonment Of Automobiles: Mandatory Deposits Vs Fines, Dwight Lee, Philip E. Graves, Robert L. Sexton
PHILIP E GRAVES
There is no abstract, but the paper describes first-best solutions to the abandonment of automobiles, arguing that litter fines are inefficient with or without a mandatory deposit. However, the latter can generate first-best optimality.
Multimarket Amenity Compensation And The Behavior Of The Elderly, Philip E. Graves, Donald M. Waldman
Multimarket Amenity Compensation And The Behavior Of The Elderly, Philip E. Graves, Donald M. Waldman
PHILIP E GRAVES
There is no abstract for this work.
On The Role Of Amenities In Models Of Migration And Regional Development, Philip E. Graves
On The Role Of Amenities In Models Of Migration And Regional Development, Philip E. Graves
PHILIP E GRAVES
See manuscript for full abstract.