Michele Baggio

On the Consumer Value of Complementarity: A Benefit Function Approach

The article develops a conceptual model of the consumer value of complementarity and illustrates its usefulness in an application to fisheries. Complementarity arises when some goods have a positive effect on the marginal value of other goods. We propose a measurement of the value of complementarity based on the benefit function. Our econometric analysis of fish consumption in Italy examines these issues, with special attention given to dynamics. Our results show that, while short-run fish demand is characterized by substitution relationships, complementarity does develop in the intermediate run and in the long run. Copyright 2007, Oxford University Press.

Helping Settle the Marijuana and Alcohol Debate: Evidence from Scanner Data

We use retail scanner data on purchases of alcoholic beverages across US counties for 2006-2015 to study the link between medical marijuana laws (MMLs) and alcohol consumption. To do this we first exploit differences in the timing of marijuana laws among states and find that they are substitutes. We show that unlike traditional national-level analysis, focusing on contiguous border county-pairs provides unbiased estimates of the effect of MMLs on alcohol sales. Specifically, counties located in MML states reduced monthly alcohol sales by 12.4 percent. Results are robust to including placebo effective dates for MMLs in treated states.We use data on purchases of alcoholic beverages across US counties for 2006-2015 to study the link between medical marijuana laws (MMLs) and alcohol consumption and focus on settling the on-going debate between the substitutability and complementarity between these two substances. To do this we exploit differences in the timing of marijuana laws among states and find that they are substitutes. Counties located in MML states reduced monthly alcohol sales by 13 percent. Our findings are robust to border counties analysis, placebo effective dates for MMLs in treated states, and a falsification test using sales of pens and pencils. Baggio: University of Connecticut, Storrs, michele.baggio@uconn.edu; Chong: Georgia State University, Atlanta and Universidad del Pacifico, Lima, achong6@gsu.edu; Kwon: Ph.D. candidate at the University of Connecticut, Storrs, sungoh.kwon@uconn.edu. We are very grateful to Stephen Ross, David Simon, and Rusty Tchernis for careful comments and suggestions and to Camila Morales and Tareena Musaddiq for excellent research assistance. The standard disclaimer applies. Scanner data calculated (or derived) based on data from The Nielsen Company (US), LLC and marketing databases provided by the Kilts Center for Marketing Data Center at The University of Chicago Booth School of Business.” Information about the data and access are available at http://research.chicagobooth.edu/nielsen/.

Short-run Economic Benefits from Water Quality Improvements: an Application to the American Lobster (Homarus Americanus) Fishery of Long Island Sound

This article proposes a quantitative investigation of the claim that improving water quality does not yield rents in commercial fisheries that are inefficiently managed. Specifically, a combined model of the resource dynamics and fishing effort is used to investigate the effects of policy scenarios on water quality improvements on the American lobster fishery in Long Island Sound. Results indicate that short-run positive rents can be extracted from the lobster fishery even when inefficiently managed, but they dissipate in the long-run as suggested by the economic literature.