This paper seeks to rehabilitate the trade theory of Augustin Cournot. In contrast to the widespread awareness among neoclassical economists of Cournot's contribution to microeconomics, there is general ignorance of his trade theory, which an earlier generation of neoclassical theorists attributed to its erroneous conclusions. I dispute this view and attempt to show the internal consistency of Cournot's trade analysis. While the assumptions underpinning his trade theory could be considered extreme, they need to be understood in the light of his methodological commitments, which included a rejection of utility in the theory of wealth, and a dismissal of Say's law regarding general employment. Furthermore, I argue that the assumptions underpinning neoclassical trade theory are no less extreme, even as their theoretical conclusions are (similarly) logically consistent. All of this serves to highlight the insufficiency of theoretical rigour in establishing the relevance of a theory; the importance of history of thought in reminding us that more than one theoretical perspective exists; and, of course, the indispensability of empirical engagement in trying to arbitrate between contrasting theoretical positions.

This paper examines the voluntary aspect of the Rural Environment Protection Scheme (REPS) in Ireland by modelling the type of farmer who chose to participate in the agri-environment programme from 1995 to 2010. The impact of changing scheme payment rates and organic nitrogen restrictions on scheme uptake are also examined. In order to examine some of the heterogeneity of variable influence on participation across the different phases of REPS, separate models for each of the four phases were ran (one for a reference year in each phase). Results from the random effects model show that the type of farmer who was most likely to participate in REPS over time had an extensive farm system, low income and spent more hours working on-farm than their non-REPS counterparts. Single year logit model results were compared to the random effects panel logit model for the entire sample period. The results suggest that the individual year models do a better job in demonstrating how farmers responded to contractual changes in the scheme over time (in terms of their participation decision) compared to the panel model. (c) 2014 Elsevier Ltd. All rights reserved.

Understanding what influences farmers’ decisions to participate in a voluntary agri-environmental scheme (AES) is essential for gauging scheme success. The Rural Environment Protection Scheme (REPS) was a voluntary AES that was available to all Irish farmers from 1994 to 2009. This paper models the participation decision of Irish farmers in REPS using a 15-year panel dataset. The approach taken is novel: actual values for gross outputs, direct costs and working hours are compared to simulated counterfactual values using a conditional logit framework. Model results show that Irish farmers behave rationally by maximising utility from both consumption and leisure but that their preferences differ by region and over time. In addition, the participation functions of viable and non-viable farmers are dissimilar in a number of ways. Policy makers may therefore need to target both groups of farmers using separate schemes in the future.

One of the main effects of intensification of agriculture in the last half century has been the reduction in the area of the various semi-natural habitats associated with traditional, mixed farming (Vickery et al. 2004). In general, since the land cover type and productivity of a specific location determine intensity of farming practices, the greatest habitat losses have occurred in lowland, fertile areas dominated by arable farming. However, as the RSPB (2001) point out, the decline in habitat quality has also been a major factor in marginal agricultural areas. Solutions to these problems of habitat loss have, in general, involved, firstly, the agricultural landscape being targeted for remedial work and secondly, the motivation of landowners by policymakers to change any farm practices that are detrimental to the rural environment. Incentives have been provided through a range of policy measures including agri-environment and wildlife management schemes.

Farmers participating in agri-environmental schemes (AESs) that are aimed at protecting biodiversity should ideally make decisions relating to the ecological management of their farms based on the habitat types found on their farms. In reality, a variety of economic, demographic, farm and farmer characteristics influence all the management decisions made by farmers, including those relating to AESs. In Ireland, the Rural Environment Protection Scheme (REPS) requires that farmers choose at least 2 biodiversity undertakings (BUs) from a menu as part of their AES contract. Using a multinomial logit model, the likelihood of farmers choosing different BUs was estimated using data from the 2007 National Farm Survey as a function of georeferenced habitat data. A comparison was then made between the probable selection of BUs with what would be considered the optimal selection from an ecological perspective. The results indicate that farmers' most likely choices of BUs only sometimes equates with the optimal ecological choices. This highlights deficiencies in the design of REPS, knowledge of which is very timely, given the imminent replacement of REPS by a new AES.

The cost of a child is estimated using information from the household budget surveys from 1987 to 2004. We use an Engel method, where the share of household expenditure on food and a broader basket of necessities both act as proxies for the material standard of living. The cost of a child is also disaggregated according to age, gender and the income status of the family. We find that older children are more costly than younger children and that children cost proportionately more in lower income households. The gap between the cost of children for lower and higher income households has increased over time. Our findings on the cost of children according to age are consistent with international findings and previous results for Ireland. Our results on the cost of children according to the income status of their families are consistent with the results of international studies using comparable methods.

This paper modelled the participation decision of Irish farmers in an agri-environmental scheme. It also uses the sub sample of farmers in the National Farm Survey actively participating in the scheme in 2007 to model the various biodiversity options undertaken as a function of farmer demographic characteristics, farm characteristic and habitat variables. The results of the analysis demonstrate that younger, married farmers with larger farms are more likely to participate in REPS and that the voluntary aspect of REPS can mean that not all habitat types are equally likely to be covered by the scheme. Farmers with internationally important habitats on their farm, like intact peatlands or semi-natural grasslands are more likely to participate in REPS. However, there is evidence to suggest that these farmers are choosing to participate in REPS because they view their land as having low economic value rather than having high ecological value. Farmers with water or wetland and forest are less likely to participate in REPS, which indicates that some important ecosystems may not be included in the scheme. The 1 biodiversity options undertaken by the farmers are found to facilitate the management of the system of farming on the holing rather than the type of habitats on the land.

This paper looks at some of the factors which may influence REPS participation among commonage farmers in the west of The Republic of Ireland and on the impact REPS has had on participating farmers' income and on their environmental practices and attitudes. Commonage is land held in common ownership on which two or more farmers have grazing rights. There are about 4500 commonages in Ireland and they are important to Irish agriculture, to conservation of the uplands, in managing the environment and in sustaining rural livelihoods. The study reveals that sheep farmers are less likely to join REPS than cattle farmers and that being in receipt of other sources of State income acted as a deterrent to participation. REPS appears to have had a positive impact on participants' income and seems to have been successful in changing farmer practices in a more environmentally benign direction, when doing so imposed no additional costs on the farmer. Environmental awareness among all farmers appears to be poor although REPS farmers display more appreciation of the degraded state of commonage than do non-REPS farmers. Farmers preference for a continuation of the status quo with respect to commonage management and a lack of discontent with respect to the distribution of past commonage rights points to the potential of building on a more co-operative approach to environmental management.

In this paper we outline the use of a farm level spatial microsimulation model that is used to produce small area farm population microdata estimates of the probability of participation by Irish farmers in the Rural Environmental Protection Scheme (REPS) for the year 2005. Previous studies that have examined the participation of farmers in agri-environmental schemes across Europe have been unable to quantify the type of habitats being protected under the programmes. This is rectified in this paper by combining the simulated farm population microdata with habitat land cover data within a GIS framework to examine what types of habitats are actually being protected under the agri-environmental programme. The results indicate that bogland, rocky complexes, forestry and shallow water are habitats that are more likely to be given protection under the REPS programme while heath, dry grassland, built land and cut fen are habitat types that are unlikely to be protected under REPS.

In this paper we outline the development of a spatial microsimulation model that uses a combinational optimisation technique called simulated annealing to match the Irish Census of Agriculture data to a National Farm Survey (NFS). The matched NFS and Census information is then used to produce small area farm population microdata estimates of the probability of participation by Irish farmers in the Rural Environmental Protection Scheme (REPS) for the year 2005. Previous studies that have examined the participation of farmers in agri-environmental schemes across Europe have been unable to quantify the type of habitats being protected under the programmes. This is rectified in this paper by combining the simulated farm population microdata with habitat land cover data within a GIS framework to examine what types of habitats are actually being protected under the agri-environmental programme. The results indicate that wetgrassland, bogland, rocky complexes, forestry and shallow water are habitats that are more likely to be given protection under the REPS programme while heath, dry grassland, built land and cut fen are habitat types that are unlikely to be protected under REPS.

In this paper we argue that there is scant justification for replacing the traditional fixed‐basket Laspeyres price index with so called ‘true cost of living indices’. We begin with a discussion of the possible explanations for some empirical results for inflation found for different social groups in Ireland in the late 1990s. Our arguments concerning appropriate inflation indices are primarily ethical and are not dependent on these results being interpreted in a non‐neoclassical vein. They do however gain extra force if one accepts non‐neoclassical explanations for the empirical results. We go on to draw conclusions as to how best to measure the welfare effects of changes in the price of goods. This links in to the broader debate regarding objective versus subjective measures of welfare.

The Rural Environment Protection Scheme (REPS) was introduced under Council Regulation 2078/92 in order to encourage farmers to carry out their activities in a more extensive and environmentally friendly manner. This article, using National Farm Survey (NFS) data, examines the extent to which farming activities that can help or hinder the environment have changed due to farmer participation in the REPS scheme. The analysis shows that REPS has had a substantial impact on the use of chemical nitrogen, phosphorous and potassium. Also, participation in REPS may have resulted in a more significant reduction in the production of organic nitrogen, organic phosphorous and methane emissions than would have been the case if the REPS farmers in the NFS had not joined the scheme.

This paper addresses the theoretical fallout from empirical studies published in the 1990s that showed no negative relationship between the introduction of minimum wages and employment. The theoretical developments have proved to be very meagre and this, it is alleged, is due to the unwieldy neo-classical framework which can only accommodate such an anomalous relationship in circumstances where employers face positive labour supply curves and for a small increase in wages. It fails to explain why more generalised minimum wages did not adversely affect unemployment. An earlier debate on the effects of minimum wages occurred in the 1940s and 1950s which provoked a dialogue between Neo-classical theorists and their Institutional critics as to the nature of economic research. Since then the framework of analysis has narrowed considerably, with only explanations consistent with the neo-classical view of optimisation by rational agents in a world of diminishing returns being theoretically acceptable. This has led to the impoverishment of economics and can partially explain the crisis in the profession when real world phenomena are at variance with the predictions of idealised models.

This paper looks at the factors determining REPS participation among commonage farmers in the West of Ireland and on the impact REPS has had on participating farmers’ income and on their environmental practices and attitudes. The study reveals that sheep farmers are less likely to join REPS than cattle farmers and that being in receipt of other sources of State income acted as a deterrent to participation. REPS had a positive impact on participants’ income and was most successful in changing farmer practices in a more environmentally benign direction, when doing so imposed no additional costs on the farmer. Environmental awareness among all farmers appears to be poor although REPS farmers display more appreciation of the degraded state of commonage than do non-REPS farmers. Farmers preference for a continuation of the status quo with respect to commonage management and a lack of discontent with respect to the distribution of past commonage rights points to the potential of building on a more co-operative approach to environmental management.

This paper questions the alleged superiority of superlative prices indices (like the Fisher index) over more standard base year indices (like the Laspeyre index) as measures of changes in the “cost of living” (COL). The primary basis of our challenge is the “subjective” concept of welfare favoured by neo-classical economists. As shown by our results, a subjective welfare approach is relatively disadvantageous to those exhibiting more flexible preferences. Given that flexible behaviour could be a characteristic of the more income constrained and the not unreasonable possibility that preferences are income determined, the neo-classical COL approach is problematic in its axiomatic foundations, in its informational requirements and from an equity perspective. By contrast, with base year indices we objectively know what it is we are measuring. This is consistent with the defence by Sen (1985) and others of objective measures of welfare, which are also more conducive to progressive social policy than are subjective utility measures.