Classification of former Soviet Union States

Transcription

1 Classification former Soviet Union States Giannias D.A. Baourakis G. (ed.). The Common Agricultural Policy the European Union: New market trends Chania : CIHEAM Cahiers Options Méditerranéennes; n pages Article available on le / Article disponible en ligne à l adresse : To cite this article / Pour citer cet article Giannias D.A. Classification former Soviet Union States. In : Baourakis G. (ed.). The Common Agricultural Policy the European Union: New market trends. Chania : CIHEAM, p (Cahiers Options Méditerranéennes; n. 29)

2 OF STATES Agrìcultwe, A. Department Universitu Crefe Various studies have vestigated the existence is that time, e.g., (19791, Johnson (1983); (1986). With a which all economic agefits to cannot be explaed, unless is can that unique to a is possible but it is unlikely wil be exactly the same. Economic agents would be willg comes dependg on the example, its location a with good and tercity system saves its implies that this still located it a UrilI and wil contue will on the will live ; own put own a is defed to clude all aspects a the the a cost advantage to some firms to demand fall until,

3 dividuals system and a willg The two system than the system was eifect the good d l with them, it is possible a has if The this is hey by supply and a high low (hgh quality), and low low This classification is usefulbecause it Companies the total bundle 2. the followg, a model the effects amenities and comes is this cm be used to the amenity as come amenities and it is assumed that identical tastes and skills that is without cost, capital is scale, and, fally, companies if that they would not fully EQ, which cludes aspects EQ affects- the utility U(.), and firms, C(.). assumed to the X, which is a composite good with a

4 that is equal to his come is assumed to be a function = is a house is a function EQ, that a house is specified by the followg function: = is assumed that P(h,EQ) = h', h, and An must A mm U(h,x,EQ) h,x,eq all subject = h' + X Let EQ, and be thesolutions to the will be, EQ, the kd o house he wil live, and how much the will be able to As it, we have that the come the will be: = wil his house is: = = IT = Equivalently, the an unction V(.) V(F,EQ,F) = mm U(h,X,EQ) is a constant. This h,x subject to = h' + X is the same at that = v, that dividuals it A cost mimizg firm solves the followg m L + + h' L. with to L, h, EQ subject to X = fo(,l,h,eq) is capital, L is and is the unit capital, f(.) is and Let EQ: and bethe solutiom EQ, the kd company will use, how much wiil As have that the come that the company will will be: = it we B 193

5 will it uses: = = = Equivalently, a unit cost fundion = m L + + h' subject to X = L, h unit cost is the same at that = c. firms, they will pay it the location decisions households and is 1. EQ is these the that willg to make between wage come and is fixed and the cumes shift up 2 than the ones the 1, at come must have utility equal to v, so that movg Combations EQ and unit costs axe depicted 2. The value shift up and 2, 2 than those 1, sce firms and havg it at wage must have unit cost equal to c, so that is that 1 and 2. any two at the level its environmental quality then 3, 1, Ea, wil be 11 Usg 1 as a thought the followg wil comes Let us 2 that 1 only that than This 2 will than 1. 3, this is by lyg above is no pot view, we have that 1 P

6 2 1. that lies above C&) as shown 3, and that has moved up than As fact, shift the to that the that equal shifts that the pot 110' le 3. to pay to locate 2 than 1 the amenity value EQz pot comes on costs so that unit Let us 3, that 1 only that the EQ3 This implies that, 3 wil than l. This 4, 3 C(&) which is to the left view, we have that 3 must that V@) lies above as shown and that V(&) has moved up than C(%). As fact, the the shift the to that the C(&) ht equal shifts the two that the pot is on the 110' le 4. and the amount to pay t~ locate 3 h EQ3 to pot is no 1 3, the effects comes on the maximum utility so that the maximum utility that a to v. the above cases 3 and 5, it is seen that: (i) when quality is and been moved up and has moved up and (G) is and V@) have both moved up and V@) has moved up With this amenities and comes. With also classify Table 1 6. is than the the low On 195

7 is an EQ, whose effect on household these two effects becomes one iden-g shifts This canbedoneby EQ and that shifts both shifts. The shifts coade with the EQlO and 110' 5,6, and 7, EQ1 and h is the mean come. any with shift the be less than the shift the effect shift the the m&um utility level unchanged and equal to v any 6 is classified as "high that this quality, those quality. This the ability havg at than with C 6) come. is is the domant These labels may be misleadg to than A 7 is than This and to the that is shift the V@) is than the shift the the shift the equal to that RA), that is, if it had moved to the position stead RA), the at pot A'

8 the A domant is its amenity, which is To can be defed follows: EQj = (Wi aij)/ói=li'j (W) j = 1,Z, 3,..., m is the ith j, wi is i, N is is all equal to 1/N that is, they should not be dexed j. by 'and 3. The implications Soviet Union To EQ, the followg Life expectancy at the 2. schoolg , To compute an the states. Only quality the all j. havg two is life O to 100. The scalg EQ value. such that all scaled that is, the scaled (ii) assumed that the weights EQ 1/N, that wi = 1/N i 197

9 Table 2. Table 2 positiong mappg 8. identifies is Kazakhstan, and 4. an kd classification is usefulbecause it to the total bundle to to on an map. The analysis shows that none is to the Among Latvia, and and

10 1 OF EQ Low and LOW Low down and m e s and Low Low down and V(&) 2 $) LAT" 68,79 64,87 64,76 60,14 55, ,62 48,23 47,38 46,18 44,65 43,83 37,43 37,22 36,98 50, a

11 2 EQ 3 4 EQ EQ EQ2 EQ3 EQ1 EQ1 200

12 5 6 Amenity A: Productivity c: Productivity Amenity 7 l 20 1

13 D. Bellante, The Dz&ential and the Heferogeneous Labor, Anlaican vol. 69, no l, G. Johnson, lntmetvopolitan Wage Dzrientials the Unifed Sfates, Jack Labm Cost, Chicago: University Chicago (1983) Tripleft, ed., The and J. Stone, Wage Dlfferentials: can Cleveland Still Compete?, Federal Bank Cleveland, Quarter 2, (1986) 1993, f h e United Development (1993) 202