The paper investigates the effects of misspecifying the disturbances in a linear regression model as spherical on the efficiency properties of the Stein-rule estimators. Asymptotic distribution of the Stein-rule estimator based on the OLS estimator is derived when the disturbances covariance matrix is nonscalar. The effects of non-spherical disturbances on the dominance conditions of the Stein-rule estimator is also observed. The risks under quadratic loss function of the Stein-rule estimators based on the OLS and the FGLS estimators are compared under a Pitman drift criterion.

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We analyze in this study the relation between changes in the price level and in income growth in the LDCs. Based on the World Bank 1965-1980 growth rates data drawn from 66 LDCs, we found significant evidence of a positive causal relation between the money supply growth rate and the inflation rate and a negative causal relation between income growth and the inflation rate. We also found that the money supply growth rate impacted positively both the inflation rate and income growth. The effect of this increase on income depends on the response of economic agents to the price increases. Our estimates, based on Summers and Heston data, agree with a basic postulate of the Lucas model: there is a significant weakening of the response as the variance of the nominal income growth rate increases. Finally, we found that prices have tended to converge among nation over the past two decades.

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An increase in the foreign country's stock of debt will raise the world interest rate and may cause the world economy to begin following a divergent path which eventually leads to bankruptcy. A number of austerity measures are discussed, e.g., tax increases, public spending decreases, and institutional reforms. Each will have a different effect on the steady state equilibrium and the dynamic adjustment path of the economy and paradoxical results may occur depending on the response of capital accumulation.

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After tax income and consumption of each income class are cointegrated respectively, we can estimate an ideal before tax consumption from the Permanent Income Hypothesis point of view. In this paper, with this estimated before tax consumption, we calculate the before tax version of the economic inequality measure proposed by Fukushige (1989), and evaluate the tax progressivity by their rate of change from the before tax version to the after tax version. This index has several theoretical advantages. Also its empirical application to Japanese data makes its advantages clear.

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In this paper, I investigate structural change and economic fluctuations in Japan by estimating a structural VAR model including four macroeconomic variables, real GNP, the GNP deflator, money supply (M₂+CD) and interest rate (call rate). The main results I obtain are as follows;
(1) Structural change tests show that the structural change in the Japanese economy in the 1970's may have occurred before the first oil crisis.
(2) Granger causality tests show that fluctuations in real GNP and the GNP deflator caused changes in money supply in the former period (1956:1-1969:4), but in the latter period (1970:1-1988:4), those relationships disappeared and conversely fluctuations in money supply caused changes in output.
(3) Innovation accounting shows that the convergence speed of the endogenous variables to exogenous innovations, in the latter period, was slower and also the interdependency of each variable was more complicated than in the former period.

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The objective of this paper is to investigate the mechanism of labor force participation in Japanese farm households. For the purpose of empirical study, Tobit type 2 model is applied to the Farm Household Survey Data. The marked findings is that in the labor force participation decision of male members, the family system has an important role as well as the market wage and the farmsize, and the off-farm income of the female earner and the number of dependents are less significant.

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In this note, we investigated a rule for the optimal provision of public goods in a many consumerseconomy when an optimal commodity tax is available. We obtained an intuitive formulawhich demonstrates that divergence from the first best rule is based on (i) the revenue repercussioneffect, (ii) the Pigou-Harberger's dead weight loss effect, and (iii) the total distribution effectof public good provision. How this result relates to previous works was also analyzed. It was shown that our decomposition formula does apply even for the cost benefit approach employed in Batina (1990).

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