ECONOMIC ANALYSIS AND EFFICIENCY IN PUBLIC EXPENDITURE

Benefit-Cost Analysis involves several steps: development of a program information structure (product categories), estimating the production function, pricing benefits and costs, adjusting for opportunity costs, choice of investment criteria, and incorporating uncertainty. Each step involves conflicts of interest that can only be resolved by political (collective) choice of property rights assigning opportunities to the various interest groups. The rules of benefit-cost analysis for public expenditure are equivalent of private property rights established by legislative and court decisions for the market economy. The traditional separation of technical analysis and political choice is not longer tenable. Theory and practice point to a more interactive, iterative relationship between analysts and politicians.Public Economics,

SOURCES OF SOCIAL CAPITAL

If the capital metaphor is to be taken seriously, social capital must focus on sources and not consequences. Human motive is the equivalent of physical capital goods which can perform transformative functions such as creating utility for one person out of the consumption of another and solving free rider problems. The focus on consequences of social capital cannot distinguish a gift motivated by affinity from a goods transfer motivated by moral obligation or promise of selfish gain. Motive is important if we are to understand investment and depreciation in social capital. The paper develops and tests a survey instrument to measure the predominant motive describing the relationships among people in eight Michigan communities with different socio-economic characteristics. Such a social capital account would allow community stocks to be compared and tracked over time.Institutional and Behavioral Economics,

THE SPARTAN SCHOOL OF INSTITUTIONAL ECONOMICS AT MICHIGAN STATE UNIVERSITY

Heterodox scholarship at Michigan State University (MSU) was influenced by the institutional economics of John R. Commons at Wisconsin. But it was far from monolithic and had many other sources and originality of its own. A case can be made that the center of institutional economics moved across Lake Michigan from Madison to East Lansing and blossomed in the second half of the 20th century with such Wisconsin Ph.D's as Raleigh Barlowe, Warren Samuels, Allan Schmid, Harry Trebing, and others. Equally important in making MSU a center of institutional economics were scholars from other institutional backgrounds such as Paul Strassmann, economic development; Robert Solo, science and technology; James Shaffer, agricultural marketing and consumer behavior; Nicholas Mercuro, law and economics; and others.Institutional and Behavioral Economics,

INSTITUTIONAL ALTERNATIVES FOR IMPROVING OUR ENVIRONMENT

Environmental Economics and Policy,

POLICY ASPECTS OF LAND-USE PLANNING IN IRELAND. BROADSHEET No. 22, December 1983

The passage of the Local Government (Planning and Development) Act in 1963 heralded a substantially increased degree of intervention by government into decisions concerning how land is used. We describe the form which this intervention took over the subsequent 20 years and analyse its implications. We do so in three phases. First we present the legislative, administrative and analytic framework, then we discuss some elements of the planning process and finish with some conclusions

THE ECONOMICS OF PRIVATE VOLUNTARY ORGANIZATIONS AND COLLECTIVE ACTION IN DEER MANAGEMENT

Game theory and other approaches have been used to characterize problems involving high-exclusion-cost goods which also have the characteristic that marginal cost of an additional user is zero over some range. These analytical tools have made valuable contributions to understanding voluntary organizations and collective action. Resource systems for which composition or scale of the resource is an important factor do not fit neatly into the types of problems which are typically analyzed. The Quality Deer Management Association (QDMA) in Southern Wisconsin is used as an example to illustrate where the existing literature must be modified to take account of particular features of this resource problem. Schelling's multi-person prisoner's dilemma model is modified to incorporate preferences and marginal benefits of deer quality to different types of hunters and to explore issues of resource sustainability. Against the odds, the private QDMA has successfully organized hunters to practice harvesting techniques consistent with improved herd quality.Resource /Energy Economics and Policy,

REGIONAL POVERTY IN MICHIGAN: RURAL AND URBAN DIFFERENCE

This paper examines the relationship between the quality of local labor force and variation in regional poverty outcomes among Michigan areas. A regional poverty model is derived from the household production model for that purpose. The US Census 2000 data on small geographical areas of Michigan (Census Block Groups) is used for the analysis. It is found that the difference in regional poverty is explained primarily by differences in quality and quantity of labor available to a household. Second, heterogeneity of the model is detected with respect to a degree of urbanization. Also, the relation between average income and regional poverty is found to be nonlinear and distribution of income playing a major role in explanation poverty. Higher poverty rates in rural areas tend to persist over time.Community/Rural/Urban Development,

APPLICATIONS OF SOCIAL CAPITAL THEORY

Experiments and studies were conducted to investigate the role of social capital. Social capital (relationship to others) is a productive asset which is a substitute for and complement to other productive assets. The productivity of social capital leads to the expectation that firms and individuals invest in relationships. Data were collected to answer the following questions: Does the identity (relationship) of trading partners affect selling and buying prices; the acceptance of catastrophic risk; the choice of share or cash leases in agriculture; loan approval; and the banks investment to retain customers? The evidence is in the affirmative.Behavioral economics, Institutional economics, Social capital, Institutional and Behavioral Economics,

AGAINST MECHANISM: METHODOLOGY FOR AN EVOLUTIONARY ECONOMICS

When the first economics departments were proposed at Cambridge and Oxford, the proponents thought acceptance would be improved if economics could be seen as incorporating the methods of physics. The enterprise was premised on the existence of economic laws that describe invariant relationships between events. These event regularities, like gravity, were not affected by human action. Humans could adapt and use them, but not change them. Thus the metaphor of "mechanism" seemed appropriate and became embedded in economists' language. It is common to use the term market mechanism to link prices and commodities. This suggests the economy is like turning a crank attached to a set of gears where there is a fixed relationship between the crank's motion and the last gear's motion. The gears have no ideas of their own, they don't get mad; there is no cognitive element between events and action.Institutional and Behavioral Economics,

The Role of Social Capital in the Industrialization of the Food System

Selfishness of preferences alone will not support the coordination necessary for the industrialization of the food system. Social capital relationships of mutual sympathy (caring) yield socio-emotional goods that are important in the more personal business world of evolving incomplete contracts and alliances involving input suppliers, processors, and labor. Relationships are also critical when consumers are buying image as well as physical products. Management and policy alternatives constitute investment in social capital that can affect opportunism, risk, loyalty, and trust.Agricultural Finance,