Imposes Opportunity Costs Research Articles

Small increases in ambient temperature reduce offspring body mass in an equatorial mammal.

Human-induced climate change is leading to temperature rises, along with increases in the frequency and intensity of heatwaves. Many animals respond to high temperatures through behavioural thermoregulation, for example by resting in the shade, but this may impose opportunity costs by reducing foraging time (therefore energy supply), and so may be most effective when food is abundant. However, the heat dissipation limit (HDL) theory proposes that even when energy supply is plentiful, high temperatures can still have negative effects. This is because dissipating excess heat becomes harder, which limits processes that generate heat such as lactation. We tested predictions from HDL on a wild, equatorial population of banded mongooses (Mungos mungo). In support of the HDL theory, higher ambient temperatures led to lighter pups, and increasing food availability made little difference to pup weight under hotter conditions. This suggests that direct physiological constraints rather than opportunity costs of behavioural thermoregulation explain the negative impact of high temperatures on pup growth. Our results indicate that climate change may be particularly important for equatorial species, which often experience high temperatures year-round so cannot time reproduction to coincide with cooler conditions.

Cash holding management for self-financing phase-able and non-phase-able project portfolio selection and scheduling problems

This article presents a novel mathematical model for managing the level of cash reserves for the self-financing phase-able as well as non-phase-able project portfolio selection and scheduling problems. Practically, the executive managers of project-oriented organizations tend to keep cash within their organization to increase their decision-making power. Although this allows managers and investors to invest in future economic projects, it imposes opportunity costs on owners and investors, in which case maintaining cash reserves can turn out to be a major challenge between owners and executive managers. This issue becomes more acute when the project-based organization operates self-financing. Because the financing is limited to the revenues of the finished projects, money withdrawn from the project account without proper management exacerbates financial constraints. Consequently, managers will bypass some future valuable investment opportunities. In this article, from the point of view of cash holding, the expectations of managers and investors in a self-financing phase-able and non-phase-able project-based organization will be met simultaneously. The proposed model is a nonlinear integer program. After linearization, an example is provided to illustrate the applicability and performance of the proposed model.

Which activities do those with long commutes forego, and should we care?

Commuting imposes opportunity costs on travelers since those with long commutes have less time to participate in other activities. This paper examines how commute duration is associated with activity patterns. It utilizes a two-day time use survey administered in the United Kingdom in 2014 and 2015. Focusing on full-time employees and controlling for socio-demographic characteristics, we regress time spent engaging in 22 different activities on commute duration using OLS and Cragg two-part hurdle modeling. We separately test the effects of commute duration on activity participation for men versus women and for single persons versus persons in couples. We also report the subjective well-being (SWB), specifically the hedonic affect, associated with these activities as determined by using fixed-effects panel regression. The estimations suggest that commutes are associated with time constraints and entail trade-offs, with longer commutes being associated with significantly less time engaging in most of our activities including sleep, cooking, housework, shopping/accessing services, arts/entertainment activities, TV/music time, computer games and other computer use, visiting with others, sports/exercise/outdoor activities, hobbies, volunteering, and non-work travel. Those with longer commutes are found to tend to engage in more of two activities: work and eating out. The activities those with longer commutes tend to forego run the gamut from high-SWB to low-SWB. Given that the lowest-SWB activity in our sample is commuting itself, it appears as if the substitution of nearly any activity for commuting may bring emotional benefits. In all, the results suggest that longer commutes are associated with significant emotional costs.

Self-Representation, Access to Justice, and the Quality of Counsel: A Comment on Rabeea Assy’s Injustice in Person: The Right of Self-Representation

Rabeea Assy’s Injustice in Person: The Right of Self-Representation (Oxford University Press) offers a powerful argument against the right of self-representation in civil cases. Selfrepresentation is usually ineffective for the self-represented litigant, sometimes verging on suicidal, and it is inefficient for the courts, which have to deal with litigants who don’t know procedure, violate rules, and waste time with pointless and sometimes incoherent arguments. Furthermore, pro se litigants not only waste the court’s time, they waste their adversaries’ time and money, and impose opportunity costs on other litigants by clogging up the courts – so an unlimited right of self-representation may inflict collateral damage beyond wasting judges’ time and trying their patience. It is simply a mistake to think that self-representation is a partial solution to the problem of access to justice. This commentary raises several concerns about his argument, focusing in particular on the dilemma facing litigants who realize too late that their counsel is incompetent, or who for whatever reason find it impossible to hire competent counsel in high-stakes matters. Based on these concerns, I suggest several categories of non-simple cases where his proposed mandatoryrepresentation rule should create exceptions: those where self-representation is the client’s only chance; those where the need to hire counsel changes an economically rational case into a loser; those where the client is actually indigent; prisoner petitions; and cases where counsel, possibly for valid paternalistic reasons, won’t provide clients with the voice to which they have a right.

Predator experience homogenizes consistent individual differences in predator avoidance

In the presence of predators, many prey species exhibit immediate behavioral responses like the avoidance of risky areas, which imposes opportunity costs, for instance, in the form of reduced foraging. Thus, prey species should be able to discriminate between different predator types and adjust their response to the imminent predation risk. In our current study, we evaluated the relative importance of innate versus learned components of predator recognition and avoidance in the guppy (Poecilia reticulata). We used a feral guppy population occurring in Germany and compared avoidance reactions of each focal individual towards both coevolved piscine predators from their original distribution range and novel, presently co-occurring predator species. Wild-caught, predator-experienced as well as laboratory-reared, predator-naive individuals showed strong avoidance responses towards all predator animations. Avoidance was stronger in small-bodied than in large-bodied individuals in both cohorts; however, this effect was significant only in predator-naive fish. Moreover, wild-caught individuals showed a significantly higher within-individual variance (across the six predator species) along with a lower among-individual variance in predator avoidance, which resulted in a lower behavioral repeatability in this cohort. Our results suggest that consistent individual differences in risk-taking behavior (also referred to as the personality trait ‘boldness’) are modified by predator exposure and learning about predators.

Coastal Communities WTA Compensation for conservation of mangrove forests: a choice experiment approach

Protection of mangrove forests entails the decrease and restriction of their injudicious uses by local people and therefore imposes opportunity costs on poor local communities, which often depend on these forest resources for their subsistence. This study aims to quantify the economic opportunity cost of conservation for coastal communities living in areas adjacent to mangrove forests in the southern coasts of Iran. The main commercial uses of the mangrove forests in this area are restricted to fishing, tourist boating trips, and limited leaves cutting. We applied a choice experiment method to measure the costs of the forest exploitation reduction under hypothetical protection scenarios in which local users would receive monetary compensation to lessen or forgo mangrove forest utilization. The results showed that local communities are willing to accept lower compensation when the protection is meant to decrease the frequency of Hara cutting and fishing, as opposed to banning recreational opportunities. The mean WTA was estimated to be 55 662 500 IRR.hsld-1 .yr-1 (2026 USD), which was generally lower than opportunity costs in the form of foregone income. Before implementing any policies related to equity, our findings can provide policymakers with useful prior knowledge and prescription.

And it’s good night Vienna. How (not) to deal with the populist radical right: The Conservatives, UKIP and some lessons from the heartland

Mainstream parties across Europe have been struggling for some time to counter the appeal of the populist radical right. With the rise of the United Kingdom Independence Party (UKIP), the British Conservative Party is now facing a similar challenge. We argue that, since this is the case, it makes sense to ask whether there are lessons it can learn from other countries – in particular Austria, where the centre-right People’s Party (OVP) has been competing against the populist radical right (most obviously, the Freedom Party) for almost three decades. In the course of so doing, the OVP has tried many ways to deal with the threat posed: treating the populist radical right as a pariah; adopting some of its policies and rhetoric; inviting it into coalition government; and finally pursuing a ‘dual-track’ approach. We evaluate each strategy in turn and find that none of them has enjoyed huge or lasting success. We conclude that the Conservatives need to realise that UKIP is not so much a problem to be solved as a situation to be managed. Seeking to toughen the Tory stance on immigration and asylum is unlikely to pay electoral dividends and carries with it considerable downsides in terms of the party’s credibility and reputation, as well as in terms of public policy. Moreover, even if a more restrictive stance does not prove entirely pointless or (worse) positively counterproductive, it imposes opportunity costs the Conservative Party should think twice before paying. All this suggests the value of a comparative approach to those wanting to understand the new dynamics in British politics.

Competition in the Search for Innovation: Getting Ahead by Falling Behind

Firms innovate by combining elements of their knowledge resources to identify combinations that are both novel and valuable. Prior research has argued that because larger resource bundles provide more elements for recombination, innovative performance increases in the size of a firm’s resource portfolio. At the same time, there are also empirical accounts of firms with inferior resources being highly innovative. Under what circumstances is investment in resources warranted, and what impact does this investment have on firms that are competing for valuable innovations? We address this question through a formal set-theoretic model. We show that the benefit of acquiring resources is contingent on both the competitive environment as well as firms’ internal search capability. In particular, our analysis demonstrates that acquiring resources imposes opportunity costs, leading to overvaluation of external resources. Moreover, we show that under a broad range of conditions, firms with inferior resources may actua...

Measuring the Local Costs of Conservation: A Provision Point Mechanism for Eliciting Willingness to Accept Compensation

Protected areas are employed worldwide as a means of conserving biodiversity. Unfortunately, restricting access to such areas imposes opportunity costs on local people who have traditionally relied on them to obtain resources such as fuelwood and bushmeat. We use contingent valuation to estimate the local benefits forgone from loss of access to a number of protected area types in Uganda. Methodologically, we innovate by implementing a “provision point” mechanism to estimate willingness to accept compensation (WTA) for loss of access to protected areas. We show that the provision point reduces mean WTA by a significant degree. (JEL Q51, Q56)

Does chemical defence increase niche space? A phylogenetic comparative analysis of the Musteloidea

Avoidance of predation can impose opportunity costs on prey species that use behavioural avoidance strategies to evade detection. An animal that spends much time hiding or remaining immobile, for example, may have less time for other important activities such as foraging or finding mates. Here we examine the idea that the evolution of chemical defence may act to release prey from these constraints, freeing defended prey to exploit their habitats more effectively, and increasing their niche space. We tested this hypothesis using comparative methods on a mammal group containing both chemically defended and non-defended species: Musteloidea. We found that defended species had a more omnivorous diet and were more likely to be active during both day and night than non-defended species. We also found that chemically defended species were less likely to be strictly diurnal or to show sexual size dimorphism, and had earlier maturing females and a shorter lifespan than non-defended species. Taken together, our results support the hypothesis that chemical defence increases the niche space available to a species. More generally, this also supports recent suggestions that strategies taken to avoid natural enemies can have important effects on diverse components of life history.

Do Certification Seals Permit a Price Premium for Online Security and Privacy?

AbstractIf some consumers care more about online privacy and security than others, and if providing privacy and security imposes opportunity costs on firms, then firms with more privacy and security measures should charge higher prices, and consumers who value these measures should be willing to pay higher prices. To test this hypothesis, data on the prices and certification seals of websites were collected. Examination of the data reveals moderate evidence that firms with a specific kind of security seal enjoy a price premium, and no evidence that sites displaying other seals enjoy a price premium. These findings suggest either that regulation may be unnecessary because markets are correctly pricing security and privacy, or that there is a market failure preventing privacy certification seals from providing credible signals to consumers.

Results form the Albanian Adult Tobacco Survey

Tobacco use prevalence in Europe is characterized by large disparities, with Western nations reporting smoking rates generally below 25%, while Eastern nations have smoking rates usually above 30%. Albania provides a distressing case study for Eastern Europe in which the exposure to the West after the fall of the communist regime dramatically increased the availability of Western-type cigarettes, while adoption of counterbalancing tobacco control measures lagged far behind. Results based on the representative Albanian Adult Tobacco Survey (AATS) conducted in 2007 suggest that smoking is a major problem, with a 64% smoking prevalence among Albanian men. It is becoming an increasingly greater concern among women, whose smoking prevalence more than doubled since 1990, reaching 19% in 2007. Young women living in urban areas are particularly susceptible to tobacco use; about one-third of them reported that they smoke. About 85% of current smokers smoke daily and with very high intensity, which further increases their risk of dying of smoking-attributable diseases. Smoking and secondhand exposure kill about 3,800 Albanians per year, about one-fifth of all deaths in the country. In addition, tobacco use imposes opportunity costs on Albanian households, which spent $358.6 million on cigarettes in 2007, or about 6% of the gross domestic product (GDP). To reduce the health and economic burden caused by tobacco use, the Albanian government should implement and enforce evidence-based tobacco control policies such increasing cigarette taxes; promoting cessation, particularly via the health care system; and enacting stricter clean indoor air laws.

Strategies of a parasite of the ant–Acacia mutualism

Mutualisms can be exploited by parasites—species that obtain resources from a partner but provide no services. Though the stability of mutualisms in the presence of such parasites is under intensive investigation, we have little information on life history traits that allow a species to be a successful mutualist or rather a parasite, particularly in cases where both are closely related. We studied the exploitation of Acacia myrmecophytes by the ant, Pseudomyrmex gracilis, contrasting with the mutualistic ant Pseudomyrmex ferrugineus. P. gracilis showed no host-defending behavior and had a negative effect on plant growth. By preventing the mutualist from colonization, P. gracilis imposes opportunity costs on the host plant. P. gracilis produced smaller colonies with a higher proportion of alates than did the mutualist and thus showed an “r-like” strategy. This appears to be possible because P. gracilis relies less on host-derived food resources than does the mutualist, as shown by behavioral and stable isotope studies. We discuss how this system allows the identification of strategies that characterize parasites of mutualisms.

A good idea that doesnt work the Parent Baby Interaction Programme

A good idea that doesnt work the Parent Baby Interaction Programme

The 150-Hour Requirement and the Number of CPA Exam Candidates, Pass Rates, and the Number Passing

This study examines the association of the 150-hour education requirement with the number of CPA exam candidates, pass rates, and the number passing. Proponents of the 150-hour requirement argue that additional education produces higher quality students who are better prepared for the CPA exam and accounting careers. Opponents argue it imposes opportunity costs on students and costly barriers to entry into public accounting. On average we find a large drop (36 percent) in the number of candidates in each state taking each exam, a small increase in pass rates for first-time candidates only (3 percent), and a large drop (31.5 percent) in the number passing the CPA exam after the 150-hour requirement. Our results may be useful to accounting educators evaluating the success of their 150-hour programs, state boards considering revisions of their 150-hour requirements, and public accounting firms setting strategies to achieve audit quality.

Aposematism: what should our starting point be?

The evolution of aposematism is considered to be a major evolutionary problem because if new aposematic forms emerged in defended cryptic populations, they would face the dual problems of rarity and conspicuousness. We argue that this commonly assumed starting point might not have wide validity. We describe a novel evolutionary computer model in which prey evolve secondary defences and become conspicuous by moving widely over a visually heterogeneous habitat. Unless crypsis imposes high opportunity costs (for instance, preventing prey from efficient foraging, thermoregulation and communication), costly secondary defences are not predicted to evolve at all. However, when crypsis imposes opportunity costs, prey evolve secondary defences that facilitate raised behavioural conspicuousness as prey exploit opportunities within their environment. Optimal levels of secondary defence and of behavioural conspicuousness increase with population sizes and the costs imposed by crypsis. When prey are already conspicuous by virtue of their behaviours, the evolution of aposematic appearances (bright coloration, etc.) is much easier to explain because aposematic traits add little further costs of conspicuousness, but can bring large benefits.

Equity trading by institutional investors: Evidence on order submission strategies

The trading volume channeled through off-market crossing networks is growing. Passive matching of orders outside the primary market lowers several components of execution costs compared to regular trading. On the other hand, the risk of non-execution imposes opportunity costs, and the inherent “free riding” on the price discovery process raises concerns that this eventually will lead to lower liquidity in the primary market. Using a detailed data set from a large investor in the US equity markets, we find evidence that competition from crossing networks is concentrated in the most liquid stocks in a sample of the largest companies in the US. Simulations of alternative trading strategies indicate that the investor’s strategy of initially trying to cross all stocks was cost effective: in spite of their high liquidity, the crossed stocks would have been unlikely to achieve at lower execution costs in the open market.

Economic Issues Regarding Irrigation Developments in Southern Egypt and on the Sinai Peninsula

The Government of Egypt is implementing projects that will expand irrigated areas on the Sinai Peninsula and in the southern desert. The projects will increase the annual demand for irrigation water in Egypt, while reducing the supply of Nile River water available to farmers in the Nile Delta. One goal of the projects is to reduce population pressure in the Delta by developing new communities in desert areas. The Government is encouraging private-sector investments in the projects, but substantial public funding also is being used to construct pumping stations, canals, and other facilities. The projects may impose opportunity costs and unintended consequences on agricultural production, rural development, and food security in the Nile Delta. The opportunity costs may include financial, hydraulic, political, and intellectual components, while unintended consequences may include reductions in agricultural wage rates in the Nile Delta and larger economic losses during sustained dry periods. Full consideration of opportunity costs and unintended consequences may be helpful in identifying complementary investments and policies that will increase the productivity of land and water resources, improve rural incomes, and enhance food security.

Editorial - Decision rules, government rules, and the costs of vegetation protection in New South Wales

Editorial - Decision rules, government rules, and the costs of vegetation protection in New South Wales

What Drives the Turnover Ratio?

Abstract Settling transactions in a payment system imposes opportunity costs of holdingliquidity on the participating banks. A measure of these costs is the turnover ratio,defined as the value of payments a bank makes per unit of overnight central bankbalances. We assume that a bank can increase its turnover ratio (and thus decreasethe opportunity cost of liquidity) by an active cash management. Despite the factthat all banks have access to the same cash management technology, we observethat the turnover ratios vary widely not only through time but also across banks.We argue that these differences can be attributed to two sources: increasing re-turns in cash management and reserve requirements. We show that the optimalbehavior of a bank depends in a non-trivial way on the whole joint distribution oftransaction volume, interest rates, and reserve requirements. These distributionsvary substantially among banks because of the different lines of business they pur-sue.We test the model with data from the Swiss Interbank Clearing system (SIC) andfind significant empirical support for it. Using our estimate of the cost function ofcash management, we are also able to quantify the costs of reserve requirementsimposed on banks. JEL classifications: G21, G28.Key words: payment systems, reserve requirements, bank behavior?We thank Stephane Fumeaux, Barbara Luscher, Thomas Nellen, William¨Roberds, and Andy Sturm for helpful discussions and comments.Email addresses: daniel.heller@snb.ch (Daniel Heller), yvan.lengwiler@snb.ch(Yvan Lengwiler).Preprint submitted to Elsevier Preprint 6 December 2000