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We investigate the cash holdings policy of family firms and examine potential value implications. Family firms hold more cash than other firms, with an average difference of 2.3% of total assets. This result is driven by firms managed by heir CEOs. While the cash holdings policy of first‐generation family firms is more sensitive to firm risk, consistent with founders’ increased risk aversion, that of later‐generation firms is more sensitive to information asymmetry and agency conflicts. Heir CEOs’ cash policies destroy value, as the marginal value of an additional Euro suffers from a 38.3‐cent discount, on average, relative to non‐family firms.

There is a chronic shortage of agricultural labor in the US. While growers are increasingly turning to guest-worker programs to meet their labor needs, few regard immigrant workers as a viable long-term solution. Further, many producers of labor-intensive agricultural commodities are considering mechanized solutions, the slow rate of adoption of mechanized harvesting equipment in the US remains an empirical puzzle. In this paper, we demonstrate that wage-setting farmers have an incentive to "over-mechanize," or employ more than the cost-minimizing level of capital when capital and labor are substitutes, but "under-mechanize" when labor and capital are technical complements. To test this theory, we estimate the marginal value of augmenting labor with non-autonomous harvesting aids on a large strawberry farm in Central California using an econometric model of peer-affected productivity that controls for the group performance of farm workers operating in crews. Our findings indicate that mechanical aids complement labor in strawberry production, an outcome that helps explain the persistent productivity gap between agricultural and non-agricultural industries, and why the adoption of mechanization has been relatively slow. We confirm the broader implications of our theory for the apparent slow adoption of mechanical harvesting technologies in US agriculture by comparing general wage trends across several labor-intensive and non-labor-intensive industries in California.

We propose a tractable model of dynamic investment, division sales (spinoffs), financing, and risk management for a multi-division firm that faces costly external finance. The model highlights the importance of considering the intertwined nature of the different policies. Our main results are as follows: (1) risk management considerations prescribe the allocation of resources based not only on the divisions' productivity -- as in standard models of ''winner picking'' -- but also their risk; (2) firms may choose to voluntarily spin off productive divisions to increase liquidity; (3) diversification can reduce firm value especially in low liquidity states, as it increases the cost of a spinoff and hampers liquidity management; (4) with corporate socialism, liquidity is less valuable since it is less costly to replenish the firm's liquidity through a spinoff; and (5) division-level investment is set such that the ratio between marginal q and the marginal cost of investing in each division equals the marginal value of cash.

This paper introduces a voting model into a framework with negative borrowing externalities to study voter preferences for prudential regulation. While voting, agents account for the general equilibrium impact of prudential policy on future asset prices and consequently, their access to credit. They thus support a universal limit on current debt. Curbing over-borrowing restricts future declines in asset prices, distributing wealth from high- to low-income borrowers, so the former prefer lax regulation. Political imperfections, such as exemptions of politically connected borrowers, distort the marginal value of regulation. This leads connected borrowers to support excessively strict policy and other agents to vote for overly lax debt limits. If connections and income are correlated, political imperfections may reverse the policy preferences of high- and low-income borrowers.

This paper studies the consignment auction as an allocation mechanism for emission permits among polluting firms. By assuming firms have non-increasing marginal values for the permits and linear bid functions, we characterize the linear equilibrium in a divisible consignment auction with positive trading volumes and a unique equilibrium price. We further compare the consignment auction with its uniform-price counterpart. We show that as firms acquire revenues from selling their consigned permits, they have incentives to overstate demands, which results in a higher equilibrium price in a consignment auction than in a uniform-price auction; nevertheless, the ex post efficiency ranking of these two auctions are generally ambiguous. Our results suggest that the non-trade equilibrium of Khezr and MacKenzie (2018) only appears when firms have a constant marginal value.

Conference calls provide a public venue through which stock analysts simultaneously interact, in large numbers, with firm management. Using a comprehensive database of transcribed U.S. corporate conference calls from 2006 to 2018, we find that institutional investors significantly react to the tone of calls in their trades and holdings of stocks. Institutions trade on the tone immediately, and up to four weeks after the call, and continue to trade on conference call-driven analyst recommendation revisions. The trade reaction of institutions to tone is more pronounced when the marginal value of information is higher, e.g., in the question section of the call, in earnings calls, and when the stock exhibits a higher degree of information asymmetry. Our paper suggests that conference calls are an important channel for stock price discovery in the post Reg-FD era.

Consumption is usually associated with time spending. Sometimes the length of time itself is part of the products, for example, the length of consulting services or time duration of transportation. In other scenarios, there is a minimum requirement of time, or waiting time, that customers have to spend during their consumption process; examples include the long queue outside an amusement park ride, shipping time after placing an order on Amazon, and waiting time when hailing for a ride on the road. Marketers have started to offer various types of time-related service packages correspondingly, such as premium pass, 1-day delivery, and priority order. In this paper, we use anonymized and normalized browsing and order data from Didi – an online ride-hailing company, and estimate the value of waiting time in riding scenarios. We find that the value of saving one standardized unit of waiting time is equivalent to lowering 0.97 standardized unit of price for an average passenger. As a reference, upgrading to a higher level of car type is equivalent to lowering prices by only 0.4 standardized units. The marginal value is decreasing when the time horizon is short, but there exists a turning point at about 1.5 standardized time units. When the waiting time is less than 1.5 units, the marginal utility is decreasing; whereas when it is longer than 1.5 units, passengers exhibit an increasing marginal value in waiting time. Furthermore, we find a larger turning point in rush-hour orders (relative to non-rush-hour orders), and in weekday orders (relative to weekend orders). Our study provides new insights on understanding the value of time and is also practically relevant for managerial decisions on time-related product design and pricing.

We examine how firms change their cash policies in response to the downfall of corrupt politicians in China. We find that firms connected to their local government increase cash holdings when high-profile politician downfalls occur in the government. Consistent with the precautionary saving argument, the effect is stronger for firms that have greater investment opportunities or face greater financial constraints. Compared to unaffected firms, affected firms save more cash out of cash flows and have a higher marginal value of cash holdings. Overall, we show that the collapse of firms' political connections has significant impacts on those firms' financial policies.

Using multiple archeological and paleoenvironmental proxies, this paper makes the case for a climate-induced convergent catastrophe among the human population of terminal Stone Age Arctic Norway. We show that climatic changes correlate with the termination of the so-called Gressbakken phase (4200–3500 cal BP), and unpack the middle-range mechanisms linking the Gressbakken termination to contemporaneous changes in the biophysical environment. We show that what was a Holocene extreme, and likely volcanically-induced, climate deterioration around 3550 cal BP coincided with a population decline as reflected in the frequency of radiocarbon-dated archeological sites along with major changes in material culture and settlement pattern. Together, these proxies suggest a return to forms of social and economic organization based on lower population densities, higher residential mobility, and reduced locational investments. In establishing the middle-range ecological mechanics mediating these changes into archeologically observable patterns, the results indicate that the Gressbakken termination was the result of a particularly unstable climate period characterized by regional paludification, increased effective precipitation, forest decline, and likely impacts on reindeer populations and their migratory behavior, with drastic human implications. We argue for a convergent catastrophe-scenario in which a series of hardships between 4000 and 3500 cal BP exceeded the adaptive mitigation capabilities of the contemporaneous Arctic Norwegian population. Our study supports the notion that increased sedentism and locational investment actually increases vulnerability in the face of rapid biophysical change and contributes to the growing database of past human ecodynamics that speak to current socio-ecological concerns.

We study the optimal marginal value of discrete-time optimal multiple stopping problems and find that it can be formulated as a single optimal stopping optimization as well. Based on this result propose a marginal-value-based lower bound method to achieve a small bound on the iterative error. We further introduce a non-nested upper bound method. The convergence of both methods is analysed. The implementation details and enhancement techniques are discussed as well. Overall, our methods make a good trade-off between the time-efficiency and the tightness in dual bounds.

We conduct a comparative welfare analysis of 133 historical policy changes over the past half-century in the United States, focusing on policies in social insurance, education and job training, taxes and cash transfers, and in-kind transfers. For each policy, we use existing causal estimates to calculate both the benefit that each policy provides its recipients (measured as their willingness to pay) and the policy’s net cost, inclusive of long-term impacts on the government’s budget. We divide the willingness to pay by the net cost to the government to form each policy’s Marginal Value of Public Funds, or its “MVPF”. Comparing MVPFs across policies provides a unified method of assessing their impact on social welfare. Our results suggest that direct investments in low-income children’s health and education have historically had the highest MVPFs, on average exceeding 5. Many such policies have paid for themselves as governments recouped the cost of their initial expenditures through additional taxes collected and reduced transfers. We find large MVPFs for education and health policies amongst children of all ages, rather than observing diminishing marginal returns throughout childhood. We find smaller MVPFs for policies targeting adults, generally between 0.5 and 2. Expenditures on adults have exceeded this MVPF range in particular if they induced large spillovers on children. We relate our estimates to existing theories of optimal government policy and we discuss how the MVPF provides lessons for the design of future research.

We study the impact that the provision of a local public good (LPG) by two cities has on their ability to attract and retain members of the creative class. This creative class consists of two types of members known as engineers and artists. Engineers are wealthier than artists and they also value the LPG more. We first focus on each city in isolation. We compute the marginal value and the marginal cost of the LPG and then determine the provision of this LPG when the provision is determined by uniform contributions and majority voting. Next, we allow the creative class members to migrate between the two cities and analyze whether engineers or artists migrate, the equilibrium distribution of the creative class, and the efficiency of the LPG provision. Finally, we consider the situation in each city just before migration and study how much of the LPG is provided when proportional contributions and majority voting determine this provision. A related question we address is whether engineers or artists now have an incentive to migrate and, if yes, we identify who would like to migrate and to which city.

Cost-effectiveness analysis (CEA), despite its known limitations, continues as the primary method used for health technology assessment (HTA) both officially (UK, Australia and Canada) and less formally elsewhere. Standard CEA models compare incremental cost increases to incremental average gains in health, commonly expressed in Quality-Adjusted Life Years (QALYs). Our research generalizes earlier CEA models in several ways. First, we introduce risk aversion in Quality of Life (QoL), which affects willingness to pay (WTP) for health care, leading to WTP thresholds that rise with illness severity. Ignoring risk aversion in QoL over-values treatments for minor illnesses and under-values treatments for highly severe illnesses, perhaps by an order of magnitude. We call our generalized WTP threshold the Risk-Aversion and Severity-Adjusted WTP (RASA-WTP). Unlike traditional CEA analyses, which discriminate against persons with disabilities, our analysis implies that the marginal value of improving QoL rises for disabled individuals. Our model can also value the uncertain benefits of medical interventions by employing well-established analytic methods from finance. We develop a certainty-equivalent quality of life measure that we call the Risk-Adjusted QALY (RA-QALY), which accounts for consumer preferences over risky health outcomes. Finally, we show that traditional QALYs no longer serve as a single index of health, when consumers are risk-averse. To address this problem, we derive a generalized single-index of health outcomes—the Generalized Risk-Adjusted QALY (GRA-QALY). The GRA-QALY reinstates the equivalence between health gains from quality of life and gains from life extension, even in the presence of risk-aversion and treatment outcome uncertainty. Earlier models of CEA that abstract from risk-aversion nest as special cases of our more general model. We discuss new data necessary to implement our model and standard analytic methods by which the necessary parameters can be obtained.

We provide sufficient conditions for the economic value of a signal to be a convex function, either locally or globally, of the input required to produce the signal. We also provide conditions under which this input can be interpreted as a measure of the information contained in this signal. We demonstrate that, under certain conditions, information is a very peculiar good that can—globally—show increasing marginal utility. In contrast to the earlier approach used to obtain the classic results on the local lack of concavity of the value of information, our approach allows permits the investigation of concavity (or lack) of the function representing the value of information, without imposing any conditions of differentiability on this function. Our approach also allows us to show that the marginal value of information can be zero even at an informative signal. Finally, we discuss some of the difficulties that can arise in designing price discrimination schemes for selling signals with various levels of quality.

Citizen science is mainstream: millions of people contribute data to a growing array of citizen science projects annually, forming massive datasets that will drive research for years to come. Many citizen science projects implement a “leaderboard” framework, ranking the contributions based on number of records or species, encouraging further participation. But is every data point equally “valuable?” Citizen scientists collect data with distinct spatial and temporal biases, leading to unfortunate gaps and redundancies, which create statistical and informational problems for downstream analyses. Up to this point, the haphazard structure of the data has been seen as an unfortunate but unchangeable aspect of citizen science data. However, we argue here that this issue can actually be addressed: we provide a very simple, tractable framework that could be adapted by broadscale citizen science projects to allow citizen scientists to optimize the marginal value of their efforts, increasing the overall collective knowledge., Citizen scientists collect data with distinct spatial and temporal biases, leading to unfortunate gaps and redundancies, and creating statistical and informational problems for downstream analyses. This Essay argues that by using a tractable framework which incentivizes looking, rather than finding, this issue can actually be addressed.

The existing studies made great efforts in economic evaluation and its value assessment on wind power integration at a macro level, which is beneficial to the long-term development of wind power but not constructive to the real-time operation and accommodation of wind power. This paper analyzes a comprehensive value of wind power, including fuel-cost saving, emission reduction, network value and reserve cost. According to the concept of locational marginal prices, this paper proposes a improved model of calculating LMPs. where the Lagrangian function and KKT are utilized to formulate the locational marginal value of wind power at a micro level. Case studies about the impact of the cost of conventional generators, locations and line transmission margin on the locational marginal value of wind power are performed to show the effectiveness of the proposed approach.

A successful cooperation mode between bioenergy producers and farmers can effectively promote the supply of biomass feedstock, which plays an important role in the bioenergy industry. In this study, we examine two prevailing cooperation modes in bioenergy supply chain, namely contract farming (CF) and land as shares (LS). This study assesses how each cooperation mode influences the planting acreage, the feedstock quality and the profits of supply chain participants. Under CF, the farmer and the bioenergy producer sign a contract in which the bioenergy producer purchases all feedstock produced by the farmer. Under LS, the farmer converts their land use rights into company shares, so that the bioenergy producer will share part of sales revenue with the farmer. First, we find that the optimal planting scale of biomass feedstock under LS is larger than that under CF when the bioenergy market size is sufficiently large. If the market size is relatively small, the supply quantity of biomass feedstock under LS depends on the marginal value of feedstock quality. Second, when the bioenergy market is sufficiently large, the farmer and the bioenergy producer under LS can achieve a win-win situation, which improves the reliability of the bioenergy supply chain. Third, we extend our model to the case where the government implements subsidies for biomass feedstock. We find that when the subsidy is high enough, the biomass feedstock quantity under LS will be larger. In addition, government subsidy does not necessarily improve the profit of all supply chain participants and excessive government subsidy may adversely affect the reliability of the bioenergy supply chain.

We investigate whether and, if so, how stakeholder orientation affects the value of cash holdings by disciplining inefficient management and reducing agency costs. In so doing, we exploit the staggered enactment of constituency statutes across different states as an exogenous shock that increases the degree of stakeholder orientation substantially. Specifically, we gauge the monitoring effect of stakeholders by using the market value of cash framework of Faulkender and Wang (2006) . We find that on average the marginal value of cash holdings increases significantly, both statistically and economically, after the passage of constituency statutes. The effect of constituency statutes on the value of cash holdings is stronger for firms with relatively weaker stakeholder power, high agency costs, and high information asymmetry. In subsequent tests, we show that investment efficiency in M&As and capital expenditures has improved significantly after the adoption of constituency statutes suggesting that heightened stakeholder monitoring over investments is a potential channel to enhance the value of cash holdings. Overall, our results suggest that stakeholder orientation increases the value of cash holdings by mitigating agency problems.

A firm trades off information transfer costs and agency costs to determine the distribution of decision rights to lower-level management. Using the replacement of municipal officials as an exogenous shock of political uncertainty, we find a business group is more likely to delegate decision rights of cash resources to subsidiaries when political uncertainty is high. The association is only evident among non-state-owned-enterprises (non-SOEs) and not SOEs. Additional tests show that the delegation of decision rights is more pronounced among firms with weak internal control and those located in cities where local governments have replaced their party secretary. We also find that firm decentralization can enhance investment efficiency and the marginal value of cash in the presence of high political uncertainty. Overall, our findings support the decentralization theory, and provide causal evidence on how political uncertainty influences allocation of decision rights among listed firms in an emerging economy with large state ownership.

We investigate the effect of 10-K readability on the association between stock returns and changes in cash holdings and find that readability significantly increases the marginal value of cash holdings (MVCH). The value spread for firms with high-readability reports is about US $0.08 per dollar of cash. This effect is stronger for firms with more severe managerial agency problems, less external monitoring, and greater financial constraints. Additional analyses suggest that the direction of causality runs from readability to the MVCH. We posit that more readable 10-Ks facilitate investors’ monitoring, inducing firms’ efficient cash use.

(ProQuest: ... denotes formulae omitted.)IntroductionThe plant family Rosaceae comprises 90 genera and over 3000 species, many with significant economic importance throughout the United States, including almond, apple, blackberry, cherry, peach, pear, plum, raspberry, rose, and strawberry (Iezzoni 2010). Rosaceous fruits and nuts are consumed as fresh and processed products that contribute to human well-being by providing essential nutrients such as vitamins, minerals, dietary fiber, and components that help reduce the risk of cancer, heart disease, and other chronic diseases (Ding and Lu 2004). Rosaceous crops are produced throughout the United States, so enhancing the economic sustainability of these industries benefits producers and their communities, the entire supply chain, and society in general.Developing and deploying superior new cultivars that meet consumer, supply chain, and producer demands is an obvious, if complicated, approach to benefit all parties. Rosaceous crop breeding programs have successfully met these dynamic demands and developed cultivars that are more desirable, available, affordable, and healthier for consumers while at the same time benefitting other stakeholders in the supply chain (Iezzoni 2010, Gallardo et al. 2012). In general, plant-breeding programs require significant investments of financial, human, and time resources. Constraints in these resources require plant breeders to set priorities in order to focus on a limited set of traits, with the goal of developing a new, breakthrough cultivar. Breeding rosaceous crops is particularly constrained by the relatively higher need for technical and land resources compared to agronomic crops; establishment of priority traits and their desirable levels of expression is critical. Although rosaceous crop breeders develop an effective sense about the relative importance of traits from their interactions with consumers, growers, and other supply chain parties, the marginal values of these traits are unknown (Gallardo et al. 2012). For example, a common perception among peach breeders is that external fruit color is important when selecting for peach cultivars; however, the marginal value for improving external color from not desirable (lack of skin blush/color) to desirable (cream/yellow background color with a red blush) is unknown. Knowledge of the relative values of fruit traits to different stakeholders can contribute to enhancing the efficiency of breeding programs by enabling breeders to focus on improving the traits of greatest value to the market (Yue et al. 2012).Because growers make the decision to plant new cultivars, absorbing the risk of adopting and diffusing the innovative products, they represent the immediate clientele in the supply chain for breeding programs. Their risk includes up-front investment costs to establish an orchard and potentially, a long payback or even a loss on the investment (Gallardo et al. 2012, Yue et al. 2013). Thus, growers have customarily provided considerable input to breeding programs, seeking cultivars most suited to their specific environmental and market conditions.Despite this, most studies in the applied economics literature have focused on consumer and market intermediary preferences. Limited research has been conducted to elicit grower preferences and growers' willingness to invest (hereafter referred to as WTP (willingness-to-pay)) to improve traits in the rosaceous crops they produce. For example, in previous studies of consumers, the most important apple fruit quality traits were crispness, sweetness, firmness, flavor, and taste (Manalo 1990, Kajikawa 1998, Jesionkowska et al. 2006, McCluskey et al. 2013). Size, taste or flavor, freshness, sweetness, firmness, color, and soluble solids concentration (SSC) have been identified as important sweet cherry traits (Dever et al. 1996, Kappel et al. 1996, Crisosto et al. 2003). Freedom from defects, color, size, SSC, flavor, and sweetness are positively correlated with fresh peach retail prices and overall acceptability for peaches (Jordan et al. …

We examine the critical role of advance supply signals—such as suppliers’ financial health and production viability—in dynamic supply risk management. The firm operates an inventory system with multiple demand classes and multiple suppliers. The sales are discretionary and the suppliers are susceptible to both systematic and operational risks. We develop a hierarchical Markov model that captures the essential features of advance supply signals, and integrate it with procurement and selling decisions.We characterize the optimal procurement and selling policy, and the strategic relationship between signal-based forecast, multi-sourcing, and discretionary selling.We show that higher demand heterogeneity may reduce the value of discretionary selling, and that the mean-value-based forecast may outperform the stationarydistribution- based forecast. This work advances our understanding on when and how to use advance supply signals in dynamic risk management. Future supply risk erodes profitability but enhances the marginal value of current inventory. A signal of future supply shortage raises both base-stock and demand rationing levels, thereby boosting the current production and tightening the current sales. Signal-based dynamic forecast effectively guides the firm's procurement and selling decisions. Its value critically depends on supply volatility and scarcity. Ignoring advance supply signals can result in misleading recommendations and severe losses. Signal-based dynamic supply forecast should be used when: (a) supply uncertainty is substantial, (b) supply-demand ratio is moderate, (c) forecast precision is high, and (d) supplier heterogeneity is high. This article is protected by copyright. All rights reserved.

In this study, an attempt has been made to study analysis of yield gap in wheat in Amravati district with view to study the economics of wheat production and resource use efficiency. The study was based on primary data on input used and there upon costs was collected from two tehsils viz., Amravati and Morshi and from each tahsil 45 samples were selected. Per hectare input utilization for wheat indicated that the medium farmers were used higher inputs as compared to other farm size group of farmers. Per hectare total cost of cultivation of wheat for the sample as whole was Rs. 37235.99 per hectare, gross return from wheat at overall level was Rs. 63861.60. The input-output relationship at overall size group was 1.76 at Cost 'C For the study resource use efficiency of wheat, Cobb-Douglas production function was used. In the overall group resources seed, plant protection and area were significant. Marginal value of product to factor cost ratio at overall group, in case of Human labour, bullock labour and seed was positive and more than one and in case of machine labour, fertilizer, manure, plant protection and area it was negative and less than one.

In this study, an attempt has been made to study the "analysis of yield gap in tur in Amravati district" with view to work out the economics tur production and resource use efficiency. The study was based on primary data on input used and there upon costs was collected from two tahsils viz., Amravati and Nandgoan khandeshwar from two tahsils 45 samples were selected. Per hectare input utilization for tur indicated that the medium farmers were used higher inputs as compared to other farm size group of farmers. Per hectare total cost of cultivation of tur for the sample as whole was Rs. 43118.82 per hectore. Gross retuns from tur at overall level was Rs.71349.48. The input-Output ratio at overall size cost 'C' was 1.65. for the study resource use efficiency of tur, Cobb-Douglas production function was used. In the overall group resources human labour, bullock labour, machine labour, fertilizer, plant protection and area were significant. Marginal value of product to factor cost ratio at overall group in case of human labour, machine labour, fertilizer was positive and bullock labour, seeds, manure, plant protection are negative. Marginal physical product to factor cost ratio indicates the change in total physical product to the change in input level of particular independent variable.

Based on the limitations of traditional procurement, this study uses analytical network process (ANP) for contractor selection. Using extensive literature review, best value (BV) contributing factors are identified. Experts are involved to get their feedback for shortlisting the identified factors. An ANP-based decision support system has been developed using data collected through a detailed questionnaire survey in the local construction industry for evaluating the selection process. Further, five case studies of completed road construction projects have been used to validate the decision support system. The findings indicate that in almost all the cases, the traditional procurement system, owing to its stringent prequalification measures, subliminally took into consideration the overall value proposition, and only one case study showed anomalies for which detailed reasoning is deliberated. This highlights the tendency of practitioners to overweigh the cost-based criteria, despite an established significance of other factors, treating the intangible value factors of quality, health and safety, environmental impact, etc. as less important. It reflects that the local construction industry attaches marginal value to qualitative factors. The construction industry will benefit from implementation of BV procurement system and a prolonged exposure may help improve its value system to realize the contribution of non-cost-based factors.

The residential mobility patterns of modern hunter-gatherers broadly reflect local resource availability, but the proximate ecological and social forces that determine the timing of camp movements are poorly known. We tested the hypothesis that the timing of such moves maximizes foraging efficiency as hunter-gatherers move across the landscape. The marginal value theorem predicts when a group should depart a camp and its associated foraging area and move to another based on declining marginal return rates. This influential model has yet to be directly applied in a population of hunter-gatherers, primarily because the shape of gain curves (cumulative resource acquisition through time) and travel times between patches have been difficult to estimate in ethnographic settings. We tested the predictions of the marginal value theorem in the context of hunter-gatherer residential mobility using historical foraging data from nomadic, socially egalitarian Batek hunter-gatherers (n = 93 d across 11 residential camps) living in the tropical rainforests of Peninsular Malaysia. We characterized the gain functions for all resources acquired by the Batek at daily timescales and examined how patterns of individual foraging related to the emergent property of residential movements. Patterns of camp residence times conformed well with the predictions of the marginal value theorem, indicating that communal perceptions of resource depletion are closely linked to collective movement decisions. Despite (and perhaps because of) a protracted process of deliberation and argument about when to depart camps, Batek residential mobility seems to maximize group-level foraging efficiency.

We consider a model of fishery management, where $n$ agents exploit a single population with strictly concave continuously differentiable growth function of Verhulst type. If the agent actions are coordinated and directed towards the maximization of the discounted cooperative revenue, then the biomass stabilizes at the level, defined by the well known "golden rule". We show that for independent myopic harvesting agents such optimal (or $\varepsilon$-optimal) cooperative behavior can be stimulated by the proportional tax, depending on the resource stock, and equal to the marginal value function of the cooperative problem. To implement this taxation scheme we prove that the mentioned value function is strictly concave and continuously differentiable, although the instantaneous individual revenues may be neither concave nor differentiable., Comment: 18 pages

Summary In the context of climate change and its effect on poverty, previous studies have shown that productivity shocks in agriculture, such as rainfall variability, affect wages adversely. None of the studies, however, consider the heterogeneity in the impact of these shocks on agricultural wages by gender, a feature which has been studied for demand shocks in urban labor markets for developed countries. Using National Sample Survey data for India from 1993 to 2007, a district-level panel dataset is created to examine how a rainfall shock affects the gender wage gap. The study shows that both female and male wages are positively related to rainfall shocks. Hence, future studies must study the impact of labor market shocks in rural areas on both female and male wages separately. It also finds that the female-to-male wage ratio is significantly positively associated with a rainfall shock in regions where rainfed rice is cultivated, i.e., low (high) rainfall reduces (increases) the female-to-male ratio. The study demonstrates that this result is due to a positive association of demand for female labor with rainfall in these rainfed rice-growing regions. This finding is consistent with the greater marginal value of female labor in rice cultivation, which is also a crop highly sensitive to rainfall variability under rainfed conditions. The paper concludes that the effect of a rainfall shock on the gender wage gap depends upon the gender roles underlying the technology of production, which varies across cropping systems.

The ACOPF is at the core of competitive electricity market design. It is the only ac-based algorithm that simultaneously co-optimizes real and reactive power dispatch for steady-state operations on ac power systems. In practice, independent system operators (ISOs) oversimplify the physical problem and settle the markets on locational marginal price (LMPs) based on real power but do not price reactive power dispatch or voltage control. This work proposes a market dispatch and pricing procedure based on the ACOPF to provide a more complete pricing mechanism. We formulate the dual problem of the SLP-IV-ACOPF as shown in [1] , which is a successive linear program shown to solve the ACOPF to an acceptable quality of convergence to a best-known solution with linear scaling of computational time in proportion to network size. Therefore, the dual problem is also a linear program; as a result, the marginal value pricing of the optimal solution to the dual problem supports the market dispatch due to strong duality, i.e., this solution technique results in a revenue adequate and more complete market design. Furthermore, we show how to distribute the complete real-time market settlements. The analysis includes a direct comparison to DCOPF-based approaches similar to those applied in current ISO markets.

A growing literature in experimental economics examines the conditions under which cooperation can be sustained in social-dilemma settings. In particular, several recent studies contrast cooperation levels in games in which the number of decision rounds is probabilistic to games in which the number of decision rounds is finite. We contribute to this literature by contrasting the evolution of cooperation in probabilistically and finitely repeated linear voluntary-contribution public-goods games (VCM). Consistent with past results, ceteris paribus, cooperation is found to increase in the marginal value of the public good. Additionally, as the number of decision sequences increases, there is a pronounced decrease in cooperation in the final round of finite sequences compared to those with a probabilistic end round. We do not, however, find consistent evidence that overall cooperation rates are affected by whether the number of decision rounds is finite or determined probabilistically.

Successive afforestation programmes undertaken in Tunisia have doubled the forest surface area in the last 50 years. A choice experiment exercise was used to estimate the social welfare associated with a plantation programme in Tunisia. The application dealt with different environmental services, and access of local users to the forest. The results show that having access to the forests for recreational activities has an average willingness to pay of 6.46 Tunisian dinar (TND) per person and year, for five years. In contrast, limiting access to the afforested areas for grazing and other uses decreases the overall welfare by 5.63 TND per person and year. An individual marginal value of 4.29 × 10−5 TND per ton of CO2 sequestered was obtained. Furthermore, a 1% decrease of dam sedimentation is worth 2.16 TND per person and year. However, results are subject to heterogeneity, particularly regarding rural and urban populations. This paper highlights that preferences for environmental services depend on ...

This article establishes a tri-level decision-making model supporting critical infrastructure (CI) resilience optimization against intentional attacks. A novel decomposition algorithm is proposed to exactly identify the best pre-event defense strategy (protecting vulnerable components and building new lines), the worst-case attack scenario, and the optimal postevent repair sequence of damaged components. As different types of CIs have different flow models, this article mainly considers the direct current power flow model and the maximal flow model for illustrative purposes. The proposed framework is illustrated by a simple but representative case system with nine nodes, and main results include: (1) the marginal value of extra defense investment under low defense budget is more considerable for mitigating system resilience loss, especially under large intentional attacks; (2) no defense strategy is always the best under different attack budgets; (3) increasing amount of repair resources can dramatically enhance CI resilience, but makes the pre-event defense strategy less effective; (4) the use of maximal flow model can provide a lower bound estimation of the resilience loss from the power flow model; (5) the optimum defense strategy and the worst-case attack identified by minimizing CI resilience loss largely differ from those by minimizing CI vulnerability, where the latter does not consider the recovery actions. Finally, the algorithm complexity is analyzed by comparing with the enumeration method and by testing two larger electric power systems.

As an important external governance mechanism, product market competition has considerable impact on the marginal value of a company’s cash holdings in various aspects. This paper examines the impact of predatory risk on the marginal value of cash holdings in product market by sampling Chinese A-share listed companies from 2000 to 2013. It shows that the predation risk in the product market increases the marginal value of cash holdings by 0.2 Yuan.

The present study is an attempt to examine resource use efficiency of wheat crop in Betul district of Madhya Pradesh and also identify of the constraints encountered in production of wheat by the farmers to achieve the potential yield of wheat. The study was conducted in 2013-14 and the results reveals that human labour was found significant for large (0.419) and overall (0.156) farm, while it non-signification for small and medium farms. Machine labour was found significant for all size of farms i.e. small (0.551) medium (0.526) large (0.370) and overall (0.687) farm size. Seed and fertilizer was found significant for small and overall farm. In case of marginal value productivity it was found that in small size farm the factors of production i.e. machine labour (X2), seed (X3), fertilizers (X4) and irrigations (X5) had been found underutilized, whereas human labour (X1) implying over utilization under the study area. The constraints related to wheat production i.e. high price of quality seed was reported by 68% farmers followed by lack of knowledge about nutrient content 67%, high price of fertilizer 60%, lack of knowledge of seed treatment 55% etc. were found major constraints.

Realising the objective of payment for ecological services (PES) schemes depends on adequate demand for these services and sustainable funding. We examine the viability of using locally financed payments as additional conservation funds to protect forest watershed services. The study employed choice experiment method to estimate the willingness to pay for watershed conservation in communities along Sungai Karang and Raja Musa forest reserve in Selangor Malaysia. A Multinomial logit (MNL) model was developed to derive the marginal value and mean willingness to pay (WTP) of the respondents on the non-market values of the forest reserve. The trade-off between four different forest watershed attributes showed that improvement in water quantity is the most preferred attributes. The total conservation value is estimated at RM12, 706.347.78. This indicates households are willing to pay for watershed conservation to ensure sustainable water supply. Thus proposing PES as an alternative source of fund for conservation of Sungai Karang and Raja Musa forest reserve.

Archaeological investigations of hunter-gatherer site structure have remained largely descriptive, despite significant explanatory advancements by evolutionary approaches to foraging behavior and ecology. To date, calls to incorporate site structure studies within this behavioral ecological framework have largely been ignored. We suggest there is a clear explanation for this. At large spatial extents, human behavior is constrained by patterned ecological variability, as such, a general theory of behavior is likely to characterize key aspects of human decisions. At small spatial extents, human behavior is not constrained by patterned ecological variability, therefore, the human decisions that produce site structure should be driven by mechanical constraints or random variation. However, variation in site structure may be ecologically relevant inasmuch as it informs on landscape level variation in human-environment interactions. Drawing on ethnoarchaeological data collected in collaboration with Martu, Aboriginal foragers in Western Australia, here we test empirically-derived, mechanistic predictions on site size and material size sorting to show how these can inform theoretically-derived, adaptive predictions from the Marginal Value Theorem. Results show that site size increases with the number of occupants and hence, the amount of in-patch foraging competition, while size sorting increases with the duration of occupation and hence, in-patch residence time. Combined, these attributes of site structure can be used as proxies of foraging behavior to explain variability in overall foraging yields. With this approach, site structure can provide insights into foraging decisions that can be examined through a general theory of behavior.

Prior literature expects a lower marginal cash value for weaker governance firms. We test this empirical hypothesis by using the sample of publicly traded Korean firms from 2005 to 2013. To measure the quality of governance structures, we employ the corporate governance scores provided by Korean Corporate Governance Services. The empirical model of Faulkender and Wang (2006) is adopted to estimate the marginal value of cash. Our empirical analysis shows a higher marginal value of cash for the good governance firms in the examination of the total governance score. This finding is consistent to the agency view of cash policy predicting a larger marginal value of cash for the firms with higher governance scores. However, this positive relationship is not robust for a subset of detailed governance scores; a lower marginal cash value is observed for the firms with better qualities of board structure, auditing, dividend policies. Moreover, our empirical analysis verifies a quite low level of marginal cash value for Korean firms, which supports the existence of severe agency conflicts in Korean corporations. Our results verify the significant role of agency conflicts between a manager and shareholders in the determination of marginal cash values in the Korean firms.

In Malaysia, transportation accounts for almost 70% of carbon monoxide emissions. This study sought to discover whether intelligently changing policies for the private and public transport sectors can affect mode choice of private car owners in the Klang Valley, Malaysia. Results of a random parameter logit model identified the most significant parameters affecting respondents’ utility measures. These were introducing a congestion fee in private transport mode; and also access, comfort and the frequency of the available public transport. Respondents’ marginal value estimates showed that they are willing to pay up to 175% of their hourly wage to have a more frequent and more accessible public transport. Moreover, the value of travel time showed that persons with longer commute time by car and bus are willing to pay more to save travel time. This is estimated about 25–50% of hourly wage of respondents. Simulation of results indicate that introducing the congestion fee has the largest impact both in modal shift and in reducing the number of cars used in the Klang Valley area. Overall results of this study suggested that any government intervention through innovative transport policy implementation such as pricing and providing more efficient public transport could result in 70% modal shift among current car users to public transport.

This paper investigates spatial, quality and temporal factors impacting the pricing of calves and yearlings in the western United States using data from a satellite video auction and a hedonic regression framework. Results suggest that spatial price discounts received by western ranchers closely match reported shipping costs and, thus, are consistent with free-on-board pricing and competitive procurement. This study also identifies the presence of temporal price premiums, on average, for seller-offered forward contracts at video auctions. With respect to quality attributes, this study provides estimates of the marginal value associated with various quality attributes and management practices, including vaccination protocols, weaning, certified Angus beef candidates, and age and source verification. Finally, we show that the considerable year-to-year variability in estimated valuations for value-added attributes in hedonic regression models of cattle pricing can be linked to the stage of the cattle cycle, with premiums paid by buyers being attenuated when cattle inventories are high.

This paper introduces a novel approach to evaluating theories of the good. It proposes evaluating these theories on the basis of their compatibility with the most plausible ways of calculating overall intrinsic value of a world. The paper evaluates the plausibility of egalitarianism using this approach, arguing that egalitarianism runs afoul of the more plausible ways of calculating the overall intrinsic value of a world. Egalitarianism conflicts with the general motivation for totalism and critical-level totalism, which is that independent contributions of each individual’s life should be counted separately. It conflicts with the most plausible version of averagism (momentary stage averagism) because only the highly implausible simultaneous life-segment version of egalitarianism can make sense of inequality being disvaluable at a time. Egalitarianism combined with a diminishing marginal value theory also fails because it holds that, other things equal, the world is a better place when we reduce inequality by adding many people whose lives go very badly but whose sheer numbers lessen inequality. The discussion moves the debate about egalitarianism forward by circumventing the oft-discussed, but intractable, debate concerning the leveling down objection. It also reveals a promising new approach to critiquing theories of the good.

Traditionally, electric system operators have dispatched generation to minimize total production costs, ignoring the flexibility of the transmission system. Implementation of smart-grid systems could allow operators to co-optimize flexible transmission alongside generation dispatch; the technologies that would enable such co-optimization are still regulated as part of the monopoly transmission system. One particular flexible transmission asset is variable impedance flexible AC transmission system (FACTS). This paper 1) points out the positive externality problem existing in a recent market design proposal with active transmission participation, and 2) proposes a sensitivity-based method to estimate the marginal market value of FACTS adjustments to overcome this positive externality problem. The marginal value would suggest efficient impedance adjustments to the operator and provide the right financial incentives for the FACTS owners to operate their assets in a socially optimal way. Revenue adequacy is demonstrated under specific conditions and more broadly investigated through simulation studies. An analytical example on a two-bus system as well as a numerical study on the IEEE 118-bus system are presented. The results suggest that inclusion of a price signal for FACTS devices would lead to significant social welfare improvements in competitive power markets.

North Sinai farming community is facing many challenges such as increasing drought and salinity in water and soil, poor quality soils, a long hot summer with high solar radiation; in addition to poor experience of settled farmers and local Bedouins in improving traditional agriculture and animal productivity under saline conditions. The main objective of the study is to establish the efficiency of resource use in millet production among smallholder farmers in North Sinai region. Using a multi-stage random sampling procedure in selecting farmers interviewed. A structured questionnaire was administered to 60 smallholder farmers selected for analysis; the farmers were divided into two groups based on ownership and use of animals on the farm, and used a model to evaluate efficiency of the two groups. In this model, a Cobb-Douglas production function was fitted for the cross- sectional data generated from the survey. The ratio of marginal value product (MVP) to marginal factor cost (MFC) for all inputs was found to be greater than unity among all groups of farmers implying under-utilization of resources. Millet farmers were found to experience increasing returns to scale, meaning use of additional inputs in millet production would result in higher yields. The null hypothesis, which stated that smallholder farmers in North Sinai region are not allocating their farm resources efficiently in millet production, was tested and rejected at 5% level of significance. It was therefore concluded that millet farmers in North Sinai region were sub-optimally allocating resources in their production system.

We can imagine a plausible case for government support of science based on traditional economic reasons of externalities and public goods. Yet when it comes to government support of grants from the National Science Foundation (NSF) for economic research, our sense is that many economists avoid critical questions, skimp on analysis, and move straight to advocacy. In this essay, we take a more skeptical attitude toward the efforts of the National Science Foundation to subsidize economic research. We offer two main sets of arguments. First, a key question is not whether NSF funding is justified relative to laissez-faire, but rather, what is the marginal value of NSF funding given already existing government and nongovernment support for economic research? Second, we consider whether NSF funding might more productively be shifted in various directions that remain within the legal and traditional purview of the NSF. Such alternative focuses might include data availability, prizes rather than grants, broader dissemination of economic insights, and more. Given these critiques, we suggest some possible ways in which the pattern of NSF funding, and the arguments for such funding, might be improved. Although our discussion here will be phrased in terms of grants for economic research from the National Science Foundation, similar arguments would apply to grants in support of economic research from the National Institutes of Health (which

The theoretical basis for understanding how human forager mobility should respond to environmental change rests on two models: patch choice and the marginal value theorem. Students of hunter–gatherers have traditionally understood the more widely favored marginal value theorem to predict that use of a given patch will be more intensive, i.e., that a greater fraction of its resources will be used, when overall (environmental) return rate decreases. We show this is true only if that patch is less affected by resource decrease than others in the environment, in the simplest case, where the number of patches available to a forager decreases without affecting the quality of the remaining patches. Then, foraging time within the patch, fraction of patch resources used, and travel time between patches will all increase. Conversely, if resources decrease across all patches uniformly, the fraction of patch resources extracted from any given patch remains constant. Within-patch foraging time may or may not decrease, but will not increase. In this case, foraging time varies independently of fraction of patch resources used and travel time. The extent to which these marginal value predictions account for hunter–gatherer mobility requires disentangling them from predictions independently generated by the patch choice model, in which as environmental quality declines, lower ranking patches are added to the foraging itinerary, decreasing travel time and either increasing or decreasing foraging time, depending on the nature of the lower ranking patches. A sample of 190 mobile hunter–gatherers suggests that a version of the patch choice model in which the patches added to the foraging itinerary are more difficult to search, and contain greater quantities of resources with higher handling times, best accounts for observed variation in foraging and travel time overall.

Albert Einstein is reputed to have said ‘Everything should be made as simple as possible, but not simpler.’ This is good advice for valuing ecosystem services. The fundamental principle of economic valuation is simple, but powerful: value is determined on the margin. This means that context is crucial in estimating ecosystem service values and, therefore, ‘benefit transfer’ exercises that fail to account for location and relative abundance are, at best, meaningless, and at worst, counterproductive. I illustrate the principles of valuation with the example of water purification by riparian buffers. Values can differ greatly over even relatively small areas, and some ostensibly paradoxical results can arise.

Institutions have been shown to be important for trade and growth. In particular, weak institutions may reduce the returns to product quality, harming domestic welfare and making it attractive to export to countries with strong institutions where quality is better rewarded. We model this alternative story as to why the “good apples are shipped out” and explore whether exporting ameliorates the problems created by weak institutions. We find that, instead, because home prices do not reflect the marginal value of quality, access to developed markets can be welfare reducing. Specifically, there are always export prices such that total welfare (and not just consumer welfare) is harmed by exporting. Furthermore, if the domestic price equilibrates to the export price, then the marginal unit exported reduces total welfare. Exporting can even reduce producer surplus, leading to a contraction of the export industry; although, welfare can decrease even if production of the exported good increases. Thus, our results reinforce the importance of strengthening institutions to help the development of economies.

Soya bean is an important economic crop for smallholder farming systems in Upper West Region of Ghana. In spite of the introduction of modern and improved soya bean production technologies in Ghana, the productivity of the crop in the region is still low. Given that inefficient use of resources is a potential course of low yields, this study analyses the resource use efficiency of soya bean production. Using cross-sectional data collected from 271 soya bean farmers from the Upper West Region of Ghana, the study employed the Stochastic Frontier Translog Production Function as well as the ratio of Marginal Value Product to Marginal Factor Cost to understand the resource use efficiency of soya bean farmers in the region. The empirical results showed that the estimated coefficients of soya bean seeds, labor and farm size were significant and positively related to soya bean output even though fertilizer input was surprisingly significantly and negatively related to the output of soya bean. Also, resources employed in soya bean production were found not to be efficiently utilized as they were underutilized, indicating that yield and profit could be improved with optimal use of production inputs. Finally, the paper revealed that access to soya bean threshers is the most important constraint faced by farmers in the region. For the region’s soya bean yield to be improved, government and development organizations should assist soya bean farmers by removing major bottlenecks to acquisition of resources required for the production and postharvest handling of the crop.

We examine the value implications of Jensen’s free cash flow hypothesis for a sample of Australian listed companies. Consistent with the US evidence in Masulis, R, C Wang and F Xie (2009). Agency problems at dual-class companies. Journal of Finance, 64(4), 1697–1727, we find that the marginal value of corporate capital expenditures in Australian listed companies is inversely related to the magnitude of agency conflicts arising out of the use of free cash flows. Our results suggest that firms where managers have a greater ability to extract private benefits and are therefore more likely to maximize their own private benefits rather than shareholder wealth will suffer from a lower perceived valuation of their capital investments. Our findings are robust to alternative proxies for relative cash flows and growth opportunities and also hold over multiple sub-periods and industry groupings.