Journal of Economic and Social Measurement - Volume 23, issue 2

Authors: Hwang, Jang C.

Article Type: Research Article

Abstract: Economic depreciation has been studied extensively by many researchers, but there are very few studies on physical depreciation. The voluminous empirical research studies on economic depreciation in economic literature indicate that economic depreciation is much easier to estimate than physical …depreciation. There are some differences in the measurement of physical depreciation between the engineering and the economic point of view. An asset in its early age may have to be retired because of economic reasons due to technological change. This makes the empirical measurement of physical depreciation even more difficult. In this paper, we derive a formula which can transform economic depreciation into physical depreciation. The transformation will provide us a consistent measurement of physical depreciation vis-a-vis economic depreciation. Two different parametric forms are also studied in this paper. The almost perfect match between the Box–Cox power transformation form and the converted form of physical depreciation further proves that the former is one of the most flexible functional forms especially well suited to the problem of analyzing depreciation patterns. The estimated curvature parameter of the Beta-decay form is negative for all Canadian industry components. The convex form of physical depreciation of the Canadian experience is contrary to the concave forms assumed by the Bureaus of Labor Statistics of the US in its capital stock estimates for the input-output industries. Show more

Keywords: Age–date price matrix, economic depreciation, physical depreciation, transformation formula, Box–Cox power transformation parametric form, test for geometric form of depreciation, Beta-decay parametric form

DOI: 10.3233/JEM-1997-23201

Citation: Journal of Economic and Social Measurement, vol. 23, no. 2, pp. 87-133, 1997

Authors: McKibben, Jerome N. | Swanson, David A.

Article Type: Research Article

Abstract: Population estimation methods designed for the state/provincial and county levels generally exhibit high levels of accuracy. However, there are persistent shortcomings that have not been resolved through methodological development. We argue that at least some of these shortcomings would be …better understood by linking these methods with the substantive socio-economic and demographic dynamics that clearly must be underlying the changes in population that the methods are designed to measure. To illustrate our main point, we conduct a case study of Indiana over two periods, 1970–1980 and 1980–1990. Indiana is selected because a common population estimation method exhibits a common problem over the two periods: its coefficients change. We link these changes to Indiana's transition to a post-industrial economy and describe how this transition operated through demographic dynamics that ultimately affected the estimation model. The results of the case study not only suggest substantive explanations for changes in the model but also the changes that are likely until the next census – the working life of the model. In turn, these changes provide information about anticipated changes in the model's coefficients which can be used to modify them in order to maximize accuracy over the model's working life. We conclude that while these results are limited in their application, they suggest additional research along these lines would benefit population estimation methods. Show more

Keywords: Post-industrial transition, population estimates, Indiana

DOI: 10.3233/JEM-1997-23202

Citation: Journal of Economic and Social Measurement, vol. 23, no. 2, pp. 135-147, 1997

Authors: Sharpe, Deanna L. | Abdel-Ghany, Mohamed

Article Type: Research Article

Abstract: Household production is typically measured by estimating the time that the homemaker spends in the various household activities. The focus in this paper was on valuating the household production time of Canadian full-time homemakers. Four variants of the opportunity cost …approach, namely, imputed wage, potential wage, Heckman's two-stage reservation wage, and Kidd's reservation wage were used to estimate and compare homemaker's time. The results indicate that the four different variants yielded different estimates of the value of household production time. One of the main conclusions is that Heckman's two-stage reservation wage approach, albeit having the advantage of correcting selection bias, it produced a wide range for the estimated reservation wage, which led us to doubt its reliability as a practical measure of the value of household production time. Show more

Keywords: Household production time, opportunity cost approach, reservation wage

DOI: 10.3233/JEM-1997-23203

Citation: Journal of Economic and Social Measurement, vol. 23, no. 2, pp. 149-162, 1997