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National security economics is a nascent field in our discipline. 1 We define national security (NS) as the set of public policies that protect the safety or welfare of a nation’s citizens from substantial threats. While NS policies are typically thought of in terms of military assets, our definition includes the development and deployment of any public good that would mitigate catastrophic outcomes for a large segment of the population. Thus we include certain investments in public health, safeguarding supplies of certain natural resources, as well as environmental and climate policies designed to mitigate possibly catastrophic future outcomes. Our main focus is on the common structure of

Numerous social indicators turned negative for Blacks in the 1980s and rebounded a decade later. We explore whether crack cocaine explains these patterns. Absent a direct measure, we construct a crack prevalence index using multiple proxies. Our index reproduces spatial and temporal patterns described in ethnographic accounts of the crack epidemic. It explains much of the 1980s rise in Black youth homicide and more moderate increases in adverse birth outcomes. Although our index remains high through the 1990s, crack's deleterious social impact fades. Changes over time in behavior, crack markets, and the user population may have mitigated crack's damaging impacts. (JEL K42, J15, I30)

Watching TV and other forms of media consumption represent, after sleeping and working, the main activity that adults perform in developed countries. We present a dynamic theory of commercial broadcasting where the media trade utility-raising goods (programs, information, and services) with audiences in exchange for their exposure to advertisements (utility-decreasing bads), and where goods are otherwise free to the audience except for their opportunity cost of time. Goods and bads are dynamically arranged, and as such traded in an intertemporal bundle. No monetary transfers take place between media and audiences, and this barter exchange is not contractually sustained. We study this dynamic problem in a model that captures the central characteristics of how commercial media markets operate. The model is rich enough to account for a variety of disparate evidence in television, radio, print media and the web.

The goal of sustainable intensification of agriculture in Malawi has led to the evaluation of innovative, regionally novel or under-utilized crop species. Quinoa (Chenopodium quinoa Willd.) has the potential to provide a drought tolerant, nutritious alternative to maize. We evaluated 11 diverse varieties of quinoa for their yield and agronomic performance at two locations, Bunda and Bembeke, in Malawi. The varieties originated from Ecuador, Chile and Bolivia in South America; the United States and Canada in North America; and, Denmark in Europe, and were chosen based on their variation in morphological and agronomic traits, and their potential for adaptation to the climate of Malawi. Plant height, panicle length, days to maturity, harvest index, and seed yield were recorded for each variety under irrigation at Bunda and Bembeke, and under rainfed conditions at Bunda. Plant height was significantly influenced by both genotype and environment. There were also significant differences between the two locations for panicle length whereas genotype and genotype × environment (G × E) interaction were not significantly different. Differences were found for genotype and G × E interaction for harvest index. Notably, differences for genotype, environment and G × E were found for grain yield. Seed yield was higher at Bunda (237–3019 kg/ha) than Bembeke (62–692 kg/ha) under irrigated conditions. The highest yielding genotype at Bunda was Titicaca (3019 kg/ha) whereas Multi-Hued was the highest (692 kg/ha) at Bembeke. Strong positive correlations between seed yield and (1) plant height (r = 0.74), (2) days to maturity (r = 0.76), and (3) biomass (r = 0.87) were found under irrigated conditions. The rainfed evaluations at Bunda revealed significant differences in seed yield, plant biomass, and seed size among the genotypes. The highest yielding genotype was Black Seeded (2050 kg/ha) followed by Multi-Hued (1603 kg/ha) and Bio-Bio (1446 kg/ha). Ecuadorian (257 kg/ha) was the lowest yielding genotype. In general the seed yields of the genotypes were lower under rainfed conditions than under irrigated conditions at Bunda. The results also highlight the need to continue evaluating a diverse number of cultivars to select for genotypes adapted to specific agro-ecological areas and across seasons in Malawi.

Infant follow-on foods may be defined as weaning and/or complementary foods and may start to be introduced 4–6 months postpartum . Complementary feeding is necessary to provide infants older than 4–6 months with sufficient micro- and macronutrients needed for healthy growth and development. The introduction of complementary food is carried out in conjunction with the use of mothers' breast milk and/or infant follow-on formulae and is done gradually to minimize the risk of developing allergies or intolerances to certain food types. The variety and suitability of foods for infants and young children are described in this article.

The worldwide boom in higher education since 1970 has been truly remarkable. Given the great breadth of benefits that college education provides, and the fact that these benefits appear to be rising over time, a worldwide rise in college education may not be surprising—but the different responses of men and women to the rising benefits of college are surprising. In the United States and throughout the world, the boom in higher education has been primarily a boom in higher education of women, so much so that in most countries, more women than men now attend college. Figures 1A and 1B plot the gender difference (women minus men) in the fraction of 30to 34-year-olds with college attainment against per capita GDP, for 1970 and 2010. A positive gender difference was a novelty in 1970, essentially reserved for a few of the wealthiest countries. Today, a larger fraction of women than men had completed higher education in 67 of 120 of the countries, including countries from every populated continent and 17 with below-median per capita GDP. In order to illuminate the worldwide boom in higher education, and in particular higher education of women, we present a model of the optimal investment in college by an individual. New DirectioNs iN the ecoNomic ANAlysis of humAN cApitAl

Drs. O'Connell and Bevvino have written a thoughtful and systematic guide to assist executives, senior managers, and professionals who have recently completed inpatient treatment and begun the jour...

Murphy and Topel (2006, henceforth MT) develop methods for valuing health improvements based on individuals’ willingness to pay. Our results indicate that past health improvements have been enormously valuable. We estimate that gains in life expectancy over the twentieth century were worth more than $1.2 million per person to the current US population, and that rising longevity added about $3.2 trillion per year to national wealth between 1970 and 2000, as mortality rates among older adults fell sharply. Looking ahead, we estimate that even modest progress against major lifethreatening diseases would be extremely valuable. For example, the two most prominent causes of disease-related mortality in the United States are cardiovascular diseases (CVD) and cancer. We find that a permanent 10 percent reduction in mortality rates from CVD would be worth about $5.7 trillion to current and future Americans, while similar progress against cancer would be worth $4.7 trillion. A 10 percent reduction in overall mortality would be worth about $18 trillion. If past progress is an indication, there is little doubt that these or greater gains will eventually be realized. The questions are when and at what cost? In comparison to these prospective benefits of health progress, expenditures on basic and applied health research in the United States are modest. Public support for basic biomedical research—mainly through the National Institutes of Health (NIH) and associated grants to research universities—totals about $28 billion annually. Adding expenditures on health research and development (R&D) by private institutions and by pharmaceutical and medical products companies brings the total for basic and applied health research to about $60 billion Social Value and the Speed of Innovation

We develop a model of intergenerational resource transmission that emphasizes the link between cross-sectional inequality and intergenerational mobility. By drawing on first principles of human capital theory, we derive several novel results. In particular, we show that, even in a world with perfect capital markets and without differences in innate ability, wealthy parents invest, on average, more in their offspring than poorer ones. As a result, persistence of economic status is higher at the top of the income distribution than in the middle. Successive generations of the same family may even cease to regress towards the mean. Moreover, we demonstrate that government interventions intended to ameliorate inequality may in fact lower intergenerational mobility—even when they do not directly favor the rich. Lastly, we consider how mobility is affected by changes in the marketplace.

We develop an economic framework for valuing improvements to health and life expectancy, based on individuals' willingness to pay. We then apply the framework to past and prospective reductions in mortality risks, both overall and for specific life-threatening diseases. We calculate (i) the social values of increased longevity for men and women over the 20th century; (ii) the social value of progress against various diseases after 1970; and (iii) the social value of potential future progress against various major categories of disease. The historical gains from increased longevity have been enormous. Over the 20th century, cumulative gains in life expectancy were worth over $1.2 million per person for both men and women. Between 1970 and 2000 increased longevity added about $3.2 trillion per year to national wealth, an uncounted value equal to about half of average annual GDP over the period. Reduced mortality from heart disease alone has increased the value of life by about $1.5 trillion per year since 1970. The potential gains from future innovations in health care are also extremely large. Even a modest 1 percent reduction in cancer mortality would be worth nearly $500 billion.

Este artículo examina los costos de reducir el consumo de un bien declarando ilegal su producción y castigando a los productores ilegales. Las drogas son el ejemplo más destacado. Cuanto más inelástica es la demanda o la oferta, mayor es el incremento del costo social de reducir la producción con mayor represión. Así, el gasto público óptimo de capturar y condenar a los proveedores ilegales no sólo depende de la diferencia entre los valores social y privado del consumo sino también de las elasticidades. Cuando la demanda y la oferta no son muy elásticas, no paga hacer cumplir la prohibición a menos que el valor social sea negativo. También muestra que un impuesto monetario reduce la producción e incrementa el precio más que la represión óptima del bien si fuera ilegal, aunque algunos productores vayan a la clandestinidad para evadir el impuesto monetario. Los impuestos al consumo y las restricciones a las cantidades no son equivalentes cuando la represión tiene costos. This paper considers the costs of reducing consumption of goods by making their production illegal and punishing illegal producers. We use illegal drugs as a prominent example. We show that the more inelastic either demand for or supply of goods is, the greater the increase in social cost from further reducing its production by greater enforcement efforts. So, optimal public expenditures on the apprehension and conviction of illegal suppliers depend not only on the difference between the social and private values of consumption, but also on this elasticity. When demand and supply are no so elastic, it does not pay to enforce any prohibition unless the social value is negative. We also show that a monetary tax could cause a greater reduction in output and increase in price than optimal enforcement against the same goods if it were illegal, even though some producers may go underground to avoid a monetary tax. When enforcement is costly, excise taxes and quantity restrictions are not equivalent.

We estimate how 1970–90 changes in an outcome‐based measure of school quality (state average test scores) affected changes in earnings for those leaving high school to enter a state’s labor force. We find that a one standard deviation deterioration in a state’s relative test score performance is associated with a 3% (or .5 SD) reduction in average wages of young entrants to the labor force. We also find a similar decline in college matriculation. There is weak evidence that the school quality effect on earnings diminishes as labor force entrants acquire experience.

In this paper we develop a new insight into the process of learning in an infant industry, in a setting where entrepreneurs are differentiated by talent. The learning rate depends on the quality of ideas, not on the scale of the industry, and a competitive open economy regime may furnish a better environment for innovation-led industrial growth even in the presence of industry-wide increasing returns to scale. Competitive market selection of ablest entrepreneurs forms a crucial condition for successful industrialization. The model is tested against the evidence of the industrial revolution in Japan, which presents a unique historic experiment in which an internationally competitive textile industry was eventually set up without government protection after earlier experiments with subsidized firms had failed. (Copyright: Elsevier)

We present a model of the creation of social networks, such as political parties, trade unions, religious coalitions, or political action committees, through discussion and mutual persuasion among their members. The key idea is that people are influenced by those inside their network, but not by those outside. Once created, networks can be rented out' to politicians who seek votes and support for their initiatives and ideas, which may have little to do with network members' core beliefs. In this framework, political competition does not lead to convergence of party platforms to the views of the median voter. Rather, parties separate their messages and try to isolate their members to prevent personal influence from those in the opposition.

In this paper, we develop and apply an economic framework for valuing improvements in health, based on Murphy and Topel (2002). Past improvements in health and longevity have had enormous social value. By our estimation, the contributions to the economic well-being of longer lifetimes have been worth about dollar 73 trillion since 1970, or about dollar 2.6 trillion per year. The average 50-year-old man gained additional life-years worth roughly dollar 350,000, while a 50-year-old woman gained about dollar 180,000. Looking ahead, prospective benefits from further progress are also large: a 10 percent reduction in mortality from heart disease would be worth over dollar 4 trillion, and even a 1 percent reduction in cancer deaths would be worth over dollar 400 billion. These values suggest that public investments in basic medical research may yield huge social returns, but distortions in the allocation of medical care and in research incentives may yield future benefits that are smaller than the costs of achieving them. While the average net health benefits of increased medical expenditures are large, costs may have greatly exceeded benefits in certain periods and age groups.

Early in his career, Winslow Homer eschewed commissions, choosing instead to put his faith in and direct his efforts toward the growing speculative market for American paintings. Denying himself the income from patrons, he worked tirelessly to manage his artistic production for maximum gain through a matrix of venues: galleries, academies, clubs, and expositions. His efforts to sell his work have trickled down to our experience of it. Homer consistently reworked or cropped paintings that proved difficult to sell, leaving visible traces of his marketing process. These traces are as visible as his creative and formal processes and remain inseparable from them.

The recent success of file-sharing technologies such as Napster has highlighted the economic question of whether copying increases or decreases the market value of copyrighted works. Contrary to Michele Boldrin and David K. Levine (2002), we show that Napster-type services are likely to reduce copyright value. This economic question of the effect of copying on copyright value largely coincides with the legal question of whether copying is "fair use." The primary legal determinant of "fair use" (or use that does not require authorization by the copyright-holder) is whether the use adversely affects the present or future economic value of the copyrighted work.1 However, given this legal standard, it is unclear why copyright-holders ever disagree with the court regarding "fair use." Our analysis shows that there is no inherent conflict between the court and copyrightholders with regard to particular uses, but why there may be a conflict with regard to a technology that has both "fair" and infringing uses.

ELEVEN YEARS AGO, our Brookings Paper "Why Has the Natural Rate of Unemployment Increased over Time?" analyzed long-term changes in joblessness among American men. (1) We documented the dramatic rise between 1967 and 1989 in both unemployment and nonparticipation in the labor force among prime-aged males. Our main conclusion was that a steep and sustained decline in the demand for low-skilled workers had reduced the returns to work for this group, leading to high rates of unemployment, labor force withdrawal, and long spells of joblessness for less-skilled men. We found that time spent out of the labor force and time spent unemployed accounted in roughly equal measure for the long-term growth in joblessness. We concluded that structural factors, primarily the decline in the demand for low-skilled labor, had dramatically changed the prospects for a return to low rates of joblessness any time soon. After that paper was published, things appeared to change. The 1990s opened with a brief recession that was followed by the longest sustained decline in unemployment in modern U.S. history. By the end of that expansion, the unemployment rate had reached its lowest level since the late 1960s, falling below 4 percent for the first time since 1969. Some macroeconomists argued that the so-called natural rate of unemployment had permanently shifted to 5 percent or below. (2) Because we had emphasized changes in the structure of labor demand that had made a return to low rates of joblessness unlikely, these facts presented a challenge to our 1991 framework. Maybe we were just wrong--maybe the demand and supply framework of our previous work is inconsistent with rates of joblessness in the post-1990 period. If so, we would join a distinguished group of social scientists who have drawn attention to a significant empirical phenomenon only to watch that phenomenon disappear immediately thereafter. (3) As it turns out, however, the framework that we developed for thinking about pre-1990 patterns of joblessness also does fairly well in helping to understand jobless time in the post-1990 period. In this paper we look in some detail at employment data from the 1990s, revisiting issues raised in our earlier work. Specifically, we ask: --Have the trends we identified in our earlier paper--the concentration of nonemployment among the less skilled, the growth of nonparticipation in the labor force, and the increased duration of joblessness--been reversed with the fall in aggregate unemployment? --Did the expansion of the 1990s really return the U.S. labor market to conditions of the late 1960s, as unemployment statistics seem to indicate? --Does the economic framework of supply and demand we utilized a decade ago still help in understanding long-term developments in unemployment, nonemployment, and labor force participation? Our answers are surprising. First, the basic trends toward longer spells of joblessness and rising nonemployment have continued in spite of the prolonged expansion of national output and the concomitant fall in unemployment rates. Long jobless spells and labor force withdrawal were more important in the 1990s than ever before. Second, the fall in unemployment to levels close to historical lows is very misleading. Broader measures of joblessness show that the labor market of the late 1990s was more like the relatively slack labor market of the late 1980s than like the booming labor market of the late 1960s. Finally, the basic forces of supply and demand identified in our previous paper continue to have explanatory power. The theory does a reasonably good job of explaining those trends that have continued, as well as those that have changed. Recent data also provide considerable insight into what has happened in the labor market over the past decade. Over the 1990s, even as unemployment was falling, time spent out of the labor force was rising. …

Texture differences of cooked quinoa were studied among 13 different varieties. Correlations between the texture parameters and seed composition, seed characteristics, cooking quality, flour pasting properties, and flour thermal properties were determined. The results showed that texture of cooked quinoa was significantly differed among varieties. 'Black,' 'Cahuil,' and 'Red Commercial' yielded harder texture, while '49ALC,' '1ESP,' and 'Col.#6197' showed softer texture. '49ALC,' '1ESP,' 'Col.#6197,' and 'QQ63' were more adhesive, while other varieties were not sticky. The texture profile correlated to physical--chemical properties in different ways. Protein content was positively correlated with all the texture profile analysis (TPA) parameters. Seed hardness was positively correlated with TPA hardness, gumminess, and chewiness at P ≤ 0.09. Seed density was negatively correlated with TPA hardness, cohesiveness, gumminess, and chewiness, whereas seed coat proportion was positively correlated with these TPA parameters. Increased cooking time of quinoa was correlated with increased hardness, cohesiveness, gumminess, and chewiness. The water uptake ratio was inversely related to TPA hardness, gumminess, and chewiness. Rapid Visco Analyzer peak viscosity was negatively correlated with the hardness, gumminess, and chewiness (P0.07); breakdown was also negatively correlated with those TPA parameters (P0.09); final viscosity and setback were negatively correlated with the hardness, cohesiveness, gumminess, and chewiness (P0.05); setback was correlated with the adhesiveness as well (r = -0.63, P = 0.02). Onset gelatinization temperature (To ) was significantly positively correlated with all the texture profile parameters, and peak temperature (Tp ) was moderately correlated with cohesiveness, whereas neither conclusion temperature (Tc ) nor enthalpy correlated with the texture of cooked quinoa.

We consider the link between parents' influence over the preferences of children, parental investments in children's human capital, and children's support of elderly parents. It may pay for parents to spend resources to "manipulate" children's preferences in order to induce them to support their parents in old age. Since parents invest more in children when they expect greater support, manipulation of child preferences may end up helping children and parents. A new result, that we call the "Rotten Parent Theorem," demonstrates that if children are altruistic, then even selfish parents will make the optimal investment in kids' human capital.

Microsoft's Internet Explorer (JE) technologies are included in Windows at no separate charge. Versions 1 and 2 of IE functioned as add-on features in Windows 95. They were not tightly integrated into Windows and did not make applications programming interfaces available to other software. Over time, IE became increasingly integrated into Windows, sharing code with other Windows features and supplying processing services to other operatingsystem components and to software applications. In addition to distribution as part of Windows, Microsoft has routinely offered free IE distribution and upgrades through other channels. Microsoft has also compensated internet access providers (IAP's) and internet content providers (ICP' s) for their efforts to promote the use and distribution of IE. Despite IE's "no-revenue" track record and assurances of free availability in the future, Microsoft spends large sums developing and promoting IE. One interpretation of these (and other) facts holds that Microsoft unlawfully "tied" the browsing functionality of IE to Windows 95 and 98 for anticompetitive purposes. This view rests on the premise that a non-Microsoft web browser could evolve into a substitute for Windows or promote potential substitutes. Of course, the emergence of a substitute would erode the profitability of Windows. Hence, according to this view, Microsoft sought to preclude or forestall the emergence of alternative software platforms by tying its own web browser to Windows and by entering into promotional agreements that raise costs for rival web browsers. As an alternative to this view, we offer a pro-competitive perspective on Microsoft's behavior with respect to IE. Our perspective resonates with several other aspects of Microsoft's behavior as well. It also carries important implications for the connection between market structure and consumer welfare.

This paper examines the relationship between population and economic growth. It analyzes the implications of the effects of higher population density on per capita incomes and other variables in different countries and other geographic regions. Several statistical models that interpolate population to cities investment in human capital and economic growth were utilized to help analyze population growth. Generally economists along with others have believed that higher population lowers per capita incomes by diminishing returns. On the contrary there are few proofs demonstrating that higher population in more developed economies reduce per capita incomes. Population may reduce productivity secondary to traditional diminishing returns from more intensive use of land and other natural resources. However large populations encourage greater specialization and increased investments in knowledge. Therefore the net relation between greater population and per capita incomes relies on whether the inducements to human capital and expansion of knowledge are stronger than diminishing returns to natural resources.

Using data from the March CPS and the 1960 Census, this paper describes earnings and employment changes for married couples in different types of households stratified by the husband's hourly wage. While the declines in male employment and earnings have been greatest for low wage men, employment and earnings gains have been largest for wives of middle and high wage men. These findings cast doubt on the notion that married women have increased their labor supply in the recent decades to compensate for the disappointing earnings growth of their husbands. We conclude that own wage effects dominate cross effects between husband and wife in accounting for changes in male and female employment.

This paper investigates the implications of social rewards on the allocation of talent in society and consequently on the process of economic growth. The authors consider two sources of heterogeneity among workers: nonwage income and innate ability. A greater emphasis on status may induce the 'wrong' individuals, that is, those with low ability and high wealth, to acquire schooling, causing workers with high ability and low wealth to leave the growth-enhancing industries. This crowding-out effect, taken alone, discourages growth. Growth may be enhanced by a more egalitarian distribution of wealth, which reduces the demand for status. Copyright 1996 by University of Chicago Press.

U.S. beef cattle stocks are among the most periodic time-series in economics. A theory of cattle cycles is constructed, based upon rational breeding stock inventory decisions in the presence of gestation and maturation delays between production and consumption. The low fertility rates of cows and substantial lags between fertility and consumption decisions cause the demographic structure of the herd to respond cyclically to exogenous shocks in demand for beef and in production costs. Known biotechnology of cattle demographics imply sharp numerical benchmarks for the dynamic system that describes the evolution of cattle stock and beef consumption. These compare very closely to structural econometric time-series estimates over the 1875-1990 period and prove that systematic cattle cycles have a wholly rational explanation.

We present new data on the fertility of blacks, 1820 to 2000, and whites, 1800 to 2000, by state. We present new data on schooling by race and cohort from 1840 to 2000. We present data on mortality for whites, 1800 to 2000, and blacks, 1820 to 2000, by state. The data indicate convergence in all three indicators. The secular decline in mortality and fertility are consistent with our previous work, Murphy, Simon and Tamura (2008). However there is a substantial difference in the behavior of fertility during the Baby Boom between whites and blacks. In many states, typically southern, white fertility rose by trivial amounts during the Baby Boom. For blacks, the Baby Boom is dramatically larger, and universal throughout the US. Schooling fails to decline for either whites or blacks during the Baby Boom, as predicted by the standard quality-quantity tradeoff of Becker and Lewis (1973). Black schooling rose as much or more than whites, despite their much larger Baby Boom. We identify this increase to the Civil Rights Successes of the 1950s and 1960s. Before the Civil War we find that the welfare cost of discrimination in school access was worth between 1.7 times to 10 times black wealth! We find that the welfare cost of discrimination in the south ranges from 1.6 to 4 times black wealth prior to 1960. We find that the Civil Rights era was valued by blacks in the South by between 1 percent to 2 percent of wealth. Outside of the South we find significant costs of discrimination prior to 1960, ranging from 8 percent to 100 percent of black wealth! For these regions from 1960-2000 blacks have attained rough parity in schooling access. The welfare magnitudes are similar to the hypothetical gains to blacks if they had white mortality rates.

Our analysis treats advertisements and the goods advertised as complements in stable metautility functions, and generates new results for advertising by building on and extending the general analysis of complements. By assimilating the theory of advertising into the theory of complements, we avoid the special approaches to advertising found in many studies that place obstacles in the way of understanding the effects of advertising. We also use this approach to evaluate advertising from a welfare perspective. Whether there is excessive or too little advertising depends on several variables: the effects on consumer utility, the degree of competition in the market for advertised goods, the induced changes in prices and outputs of advertised goods, and whether advertising is sold to consumers.

Using data from the March Current Population Survey, we document an increase over the past 30 years in wage inequality for males. Between 1963 and 1989, real average weekly wages for the least skilled workers (as measured by the tenth percentile of the wage distribution) declined by about 5 percent, whereas wages for the most skilled workers (as measured by the ninetieth percentile of the wage distribution) rose by about 40 percent. We find that the trend toward increased wage inequality is apparent within narrowly defined education and labor market experience groups. Our interpretation is that much of the increase in wage inequality for males over the last 20 years is due to increased returns to the components of skill other than years of schooling and years of labor market experience. Our primary explanation for the general rise in returns to skill is that the demand for skill rose in the United States over this period.

The last forty years have witnessed a remarkable boom in higher education around the world. Importantly, the boom in higher education has been concentrated among women, such that today in most higher-income countries, and many lower-income countries, more women than men attend and complete tertiary education. We present a model that explains the increase in higher education, particularly among women, in terms of a market for college graduates in which the supply of college graduates is function of the distribution of the costs and benefits of higher education across individuals. Examining evidence on these costs and benefits, we find no clear evidence that benefits are greater for women than men. Instead, it appears that differences in the total costs of college for women and men - primarily due to differences in the distributions of non-cognitive skills for women and men - explain the overtaking of men by women in higher education.

This paper considers specialization and the division of labor. A more extensive division of labor raises productivity because returns to the time spent on tasks are usually greater to workers who concentrate on a narrower range of skills. The traditional discussion of the division of labor emphasizes the limitations to specialization imposed by the extent of the market. We claim that the degree of specialization is more often determined by other considerations. Especially emphasized are various costs of "coordinating" specialized workers who perform complementary tasks, and the amount of general knowledge available.

We present a theory of a partial economic reform of a planned economy, similar to the one that took place in Russia since 1988 and in China earlier. In such a reform, some markets are liberalized in the sense that producers can sell output to whomever they want, including private firms, at free prices, but at the same time must sell to state firms at state prices. We show that such a reform can result in a substantial diversion of subsidized inputs away from state firms and toward private firms even when state firms value these inputs more. The result may be a reduction of total output. The simple analysis sheds light on many consequences of the Soviet reform, such as breakdown of coordination of production, increased state policing of delivery quotas, prohibitions of trading cooperatives, and opposition to privatization. The model also explains why partial reform failed in Russia but worked in China.

A simple supply and demand framework is used to analyze changes in the U. S. wage structure from 1963 to 1987. Rapid secular growth in the demand for more-educated workers, "more-skilled" workers, and females appears to be the driving force behind observed changes in the wage structure. Measured changes in the allocation of labor between industries and occupations strongly favored college graduates and females throughout the period. Movements in the college wage premium over this period appear to be strongly related to fluctuations in the rate of growth of the supply of college graduates.

Although surveys show that traditional orderings of average wage—i.e., higher earnings with higher schooling and concave age-wage profiles—have not changed during the past three decades, the actual size of the wage differentials measured by education or by work experience has varied from peak to trough by a factor of two-to-one. The patterns are not monotone, but there is a trend toward increased skill premiums. We first examine the structure of wages among white men distinguished by age and schooling for the period from 1963 to 1989. We then compare shifts in the distribution of wages and employment among the age x schooling categories to show in reference to a stable demand structure that employment alone cannot account for observed changes in relative wages. Finally, we describe the characteristics required of candidate demand shifters and offer examples using linear trend, business cycle shocks, and recent patterns of deficits in international trade.

We present new data documenting the secular decline in fertility in the states of the United States, the dramatic convergence in fertility, child schooling, parental schooling, survival probabilities. In addition we document the disparate nature of the Baby Boom in the United States. There were two different regimes, a large Baby Boom and a Small Baby Boom. The large Baby Boom regions also had the smallest increase in child schooling, whereas the small Baby Boom regions had the largest increase in child schooling. We present suggestive evidence that falling mortality risk is strongly positively correlated with falling fertility, rising education levels of parents is strongly negatively related to fetility, and that population density is negatively related to fertility. Finally we show the robust negative correlation of mortality risk on child schooling attainment, and positve correlation of population density and child schooling attainment.

The "human capital earnings function," in which earnings are expressed as a quadratic in potential experience, is probably the most widely accepted empirical specification in economics. In spite of its widespread acceptance, the human capital earnings function provides a very poor approximation of the true empirical relationship between earnings and experience. The standard formulation understates early career earnings growth by about 30 percent-50 percent and overstates midcareer growth by 20 percent-50 percent. However, simple alternative specifications that fit the data are available. Copyright 1990 by University of Chicago Press.

Our model of growth departs from both the Malthusian and neoclassical approaches by including investments in human capital. We assume, crucially, that rates of return on human capital investments rise, rather than, decline, as the stock of human capital increases, until the stock becomes large. This arises because the education sector uses human capital note intensively than either the capital producing sector of the goods producing sector. This produces multiple steady scares: an undeveloped steady stare with little human capital, low rates of return on human capital investments and high fertility, and a developed steady stats with higher rates of return a large, and, perhaps, growing stock of human capital and low fertility. Multiple steady states mean that history and luck are critical determinants of a country's growth experience.

Medical care at the end of life, estimated to contribute up to a quarter of US health care spending, often encounters skepticism from payers and policy makers who question its high cost and often minimal health benefits. It seems generally agreed upon that medical resources are being wasted on excessive care for end-of-life treatments that often only prolong minimally an already frail life. However, though many observers have claimed that such spending is often irrational and wasteful, little explicit and systematic analysis exists on the incentives that determine end of life health care spending. There exists no positive theory that attempts to explain the high degree of end-of life spending and why differences across individuals, populations, or time occur in such spending. This paper attempts to provide the first rational and systematic analysis of the incentives behind end of life care. The main argument we make is that existing theoretical and empirical analysis of the value of life do not apply, and often under-values, the value of life near its end and terminal care. We argue that several factors drive up the value of life near its end including the low opportunity cost of medical spending near ones death, the value of hope including living into new innovations, and potential positive effect of on the value of life from being frail. We calibrate the ex-post value of hope associated with treatments for HIV patients to be as much as five times as high as standard estimates of treatment value.

We consider three questions related to the choice between war in Iraq and a continuation of the pre-war containment policy. First, in terms of military resources, casualties and expenditures for humanitarian assistance and reconstruction, is war more or less costly for the United States than containment? Second, compared to war and forcible regime change, would a continuation of the containment policy have saved Iraqi lives? Third, is war likely to bring about an improvement or deterioration in the economic well-being of Iraqis? We address these questions from an ex ante perspective as of early 2003.According to our analysis, pre-invasion views about the likely course of the Iraq intervention imply present value costs for the United States in the range of $100 to $870 billion. Our estimated present value cost for the containment policy is nearly $300 billion and ranges upward to $700 billion when we account for several risks stressed by national security analysts. Our analysis also indicates that war and forcible regime change will yield large improvements in the economic well-being of most Iraqis relative to their prospects under the containment policy, and that the Iraqi death toll would likely be greater under containment.

A wide range of social indicators turned sharply negative for Blacks in the late 1980s and began to rebound roughly a decade later. We explore whether the rise and fall of crack cocaine can explain these patterns. Absent a direct measure of crack cocaine%u2019s prevalence, we construct an index based on a range of indirect proxies (cocaine arrests, cocaine-related emergency room visits, cocaine-induced drug deaths, crack mentions in newspapers, and DEA drug busts). The crack index we construct reproduces many of the spatial and temporal patterns described in ethnographic and popular accounts of the crack epidemic. We find that our measure of crack can explain much of the rise in Black youth homicides, as well as more moderate increases in a wide range of adverse birth outcomes for Blacks in the 1980s. Although our crack index remains high through the 1990s, the deleterious social impact of crack fades. One interpretation of this result is that changes over time in behavior, crack markets, and the crack using population mitigated the damaging impacts of crack. Our analysis suggests that the greatest social costs of crack have been associated with the prohibition-related violence, rather than drug use per se.

A wide range of social indicators turned sharply negative for Blacks in the late 1980s and began to rebound roughly a decade later. We explore whether the rise and fall of crack cocaine can explain these patterns. Absent a direct measure of crack cocaine%u2019s prevalence, we construct an index based on a range of indirect proxies (cocaine arrests, cocaine-related emergency room visits, cocaine-induced drug deaths, crack mentions in newspapers, and DEA drug busts). The crack index we construct reproduces many of the spatial and temporal patterns described in ethnographic and popular accounts of the crack epidemic. We find that our measure of crack can explain much of the rise in Black youth homicides, as well as more moderate increases in a wide range of adverse birth outcomes for Blacks in the 1980s. Although our crack index remains high through the 1990s, the deleterious social impact of crack fades. One interpretation of this result is that changes over time in behavior, crack markets, and the crack using population mitigated the damaging impacts of crack. Our analysis suggests that the greatest social costs of crack have been associated with the prohibition-related violence, rather than drug use per se.