intensive goods to countries other than the United States. This may be considered as supporting the generally held opinion that Japan's foreign trade is two-sided.10 We suspect that foreign trade might have a similar nature. If data were available on the capital-labor ratios for United States exports broken down by countries, then more conclusive findings might be expected about the position of the United States in the international division of labor.11 Another interesting fact is that the capital-labor ratio for United States exports to Japan is not only larger than that for the United States total exports but also exceeds that for competitive imports. This means that United States exports to Japan are more capital-intensive than United States domestic production for replacing its competitive imports from the rest of the world. This would seem also to demand more careful investigation into the so-called Leontief paradox. We would like to refrain from drawing any sweeping conclusions here. 10 Cf. Economic Planning Board, Survey of Japanese Economy (I956-57). ' According to A. Daniere, relative foreign inefficiency is less in the production of B than in the production of A, where A denotes manufactured goods and B raw materials (ores, oils, rubber, and other important United States imports), due to differences in material resource endowment. Since these raw material products, on the whole, require a high capital-labor ratio, the large raw material component of United States imports suggests, in agreement with the authors' view, that the Leontief capital intensiveness situation holds better in the trade with raw material areas than with industrial countries. See Andre Daniere, American Trade Structure and Comparative Cost Theory, Economia Internazionale, Ix (August, I956), 426.

Introduction, 279. — I. Determinants of water value in the basin, 280; how to allocate water between power and irrigation, 280; taking account of delivery losses along a canal, 284; effects of water rights, 288. — II. Allocation between major water uses, 289; competition among eight water uses, 289; below Lake McConaughy, 290; above Lake McConaughy, 291; between the two areas, 291. — III. Conclusion, 292; findings for the North Platte River, 292; further applications, 293. — Appendix on canal losses, 294.

Previous studies have recognized that occupational mobility varies with age, but studies have been impeded by imperfect measures of income to which career choosers respond. In this article, cohort changes for six age groups are viewed as resulting from responses to unobserved relative incomes in each of five decades. By an iterative procedure, leastsquares estimates can be obtained for ratios of age group response coefficients, and relative incomes are estimable down to a logarithmic transformation. Properties of the estimators are investigated. The analysis is applied to the U.S. and regions, and inferences are made about changes in the aggregate supply elasticity of farm operators and other conditions likely to prevail in the future.

Percentage changes in marginal utility are found to be invariant to utility transformations. They are quantifiable in the ordinary sense, and price and income elasticities can be expressed in terms of them. Definitions of necessityluxury, independence and complementarity-substitutability in terms of the measurable utility changes lead to insights for empirical studies. A POTENTIALLY rich source of insights about demand behavior is the wantsatiation characteristics of goods, i.e., degree of necessity or luxury of goods and degree of complementarity or substitutability between them. These characteristics have been stubborn against attempts to bring them into demand analysis. Despite decades of interest, the literature does not appear to have produced satisfactory definitions of complements and substitutes. Previous necessity-luxury analyses have rested on assumed differences in algebraic form of demand functions. Necessity-luxury attributes have not been expressed in terms of the usual utility concepts of consumer choice theory. 2 In the present article, measurable want-satiation characteristics of goods are derived by considering changes in marginal utility when expenditures are shifted within the consumer's budget. It is demonstrated that the percentage change in marginal utility of a good is invariant to utility transformations and can be related to price and income elasticities. This result is due to the previously overlooked fact that the percentage change in the marginal utility of a good, when moving along a given indifference curve, is identical to a change in the marginal rate of substitution brought about by moving from one indifference curve to another. The measurability of percentage changes in marginal utility is thus seen to be as reasonable as the measurability of the marginal rate of substitution. Two systems of percentage changes in marginal utility are developed. The ei system is appropriate for considering one good vis-a-vis all other goods. In this system, an increase in expenditure on a particular good is accompanied by an equal reduction in expenditure distributed among all other goods so

How MUCH DOES technological change in agriculture contribute to the nation's growth? How greatly will agriculture be affected by conditions making for growth in the national economy? Answers to questions like these pertaining to interactions between agriculture and the rest of the economy are needed perennially in formulating national economic policies and in formulating price support and other policies focusing on agriculture. Discussion of the questions has been fragmented, with not much attention to the overall set of relationships determining interactions between the two parts of the economy. The first contribution of the present study is to develop a model appropriate to explaining adjustments between agriculture and the rest of the economy implied by U.S. growth. We believe this study presents for the first time a formally complete model taking account of feedback effects involved in intersectoral equilibration and production function substitution between factors.' The model contains two sectors (agriculture and nonagriculture) and two productive factors (human resources and physical capital). Factor immobilities and other non-Pareto features are introduced, and there are special complications involving agriculture's purchased inputs which affect price measurement and production functions. Equilibrations determining prices and quantities of products and factors for each sector are explained within the model as responses to changes in the economy's major exogenous forces. These forces, reflected in the exogenous variables, include output per unit of input in the two sectors and total factor supplies available to the economy. The model permits quantitative estimates of how effects of changes in

Using single-equation approaches, previous studies concerned with human capital indicate that education expenditures have a large effect on income. Previous studies concerned with local government behavior indicate that income has a large effect on education expenditures. There is the possibility that essentially the same relationship is being measured, with dependent and independent variables merely interchanged. In this study, the equations are estimated simultaneously. To see why single- and simultaneous-equations estimates differ, expressions are developed for sources of single-equation bias.The major reason for a large single-equation bias in estimating the effect of education on income is found to be the relatively large reverse effect of income on education, which makes for high correlation between independent variable and residual in the equation for income. Single-equation bias in the equation explaining education expenditures is small for the same underlying reason, namely the reverse effect occurring in the equation is relatively small. A by-product is an analysis of demand for education allowing for effects of different forms of wealth, in contrast to the usual approach assuming one overall wealth or income effect. Nonhuman wealth is estimated to have twice as much effect on education expenditures as other forms of wealth.

The range of admissible price and income elasticity estimates is materially reduced in this investigation of a variety of procedures, including new methods for analyzing deflation bias. Mostly small effects are found for choice of index formula, base year, logarithmic versus linear form, definition of food consumption (e.g., physical versus expenditure measure), procedures related to time, and aggregation. However, the supply elasticity of food is found to be identifiable and to have a value greater than many have believed, providing a basis for deciding whether to favor demand estimates based on consumption-dependent or pricedependent regressions. The most frequently used deflators are inconsistent with the SlutskySchultz relation. Estimates are developed of three types of bias due to improper deflation (weight of food in deflator, correlation of deflator with residual, and formula nonconformities).