All new papers
http://lists.repec.org/mailman/listinfo/nep-all
All new papers
2018-12-24
SSI Youth Recipient and Employment Transition Formative Research Project: Community of Practice: Organizational Features and Lessons Learned
http://d.repec.org/n?u=RePEc:mpr:mprres:11e9d9ff3c1248c89576ead628b5769b&r=all
This report documents the role of, involvement in, and contributions of the Community of Practice to the Supplemental Security Income Youth Recipient and Employment Transition Formative Research project.
Kelli Crane
Richard Luecking
Todd Honeycutt
Sarah Palmer
SSI, youth, transition, employment, supplemental security income, interventions, community of practice
The Transition to Employment: Better Data Needed to Identify Best Practices for Youth SSI Recipients
http://d.repec.org/n?u=RePEc:mpr:mprres:ad200cd5940b4268a555c609b050214d&r=all
This brief highlights two transition frameworks designed to guide the development and assessment of interventions for youth with disabilities.
Todd Honeycutt
David Wittenburg
Richard Luecking
Kelli Crane
David R. Mann
SSI, youth, transition, employment, supplemental security income, interventions
SSI Youth Formative Research Project: Considerations for Identifying Promising and Testable Interventions
http://d.repec.org/n?u=RePEc:mpr:mprres:7a497b409e9545eb8d73585ba83f2de3&r=all
This report identifies promising interventions that could assist youth with disabilities.
Todd Honeycutt
David Wittenburg
Kelli Crane
Michael Levere
Richard Luecking
David Stapleton
SSI, youth, transition, employment, supplemental security income, interventions
The Half Life of Economic Injustice
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13342&r=all
How much of today's income (GDP) is a result of unjust economic transactions? How much is a legacy of past acquisition of wealth (capital) which was itself unjust? To answer that question requires two things: first, a principle to determine what is, and what is not, a just acquisition of wealth or a just source of income; second, a means of using that principle to estimate what fraction of wealth and income is unjust. I use a principle put forward by Robert Nozick to provide the first of these things and then use some calculations based on standard neoclassical models of economic growth to illustrate its implications for the scale of unfairness today.
Miles, David K
Distributive justice; Human Capital; income distribution; Solow growth model
2018-11
An Institutional Analysis of American Job Centers: Study Highlights
http://d.repec.org/n?u=RePEc:mpr:mprres:7b16923cab5e4eef88f93e5fd440812b&r=all
This paper summarizes the Institutional Analysis of American Job Centers (AJCs) study design, key findings, and implications for the AJC system under the Workforce Investment and Opportunity Act.
Pamela Holcomb
Linda Rosenberg
Elizabeth Brown
Brittney English
Kate Dunham
Hannah Betesh
AJCs, WIOA, workforce, service delivery, operations, employment, resource sharing, institutional analysis
Promoting Readiness of Minors in Supplemental Security Income (PROMISE): New York State PROMISE Process Analysis Report
http://d.repec.org/n?u=RePEc:mpr:mprres:2c1171a793c94131af24444010778799&r=all
This report presents findings on the implementation and operation of the New York State PROMISE program, which was designed to (1) provide educational, vocational, and other services to SSI youth and their families and (2) improve service coordination among state and local agencies serving that population.
AnnaMaria McCutcheon
Karen Katz
Rebekah Selekman
Todd Honeycutt
Jacqueline Kauff
Joseph Mastrianni
Adele Rizzuto
disability, SSI, youth, employment, education, PROMISE
The Impact of Blockchain on the Music Industry
http://d.repec.org/n?u=RePEc:zbw:itse18:184968&r=all
This paper explores the impact of blockchain on the music industry with a focus on the implications technology can have for artists. By investigating the industry's supply chain, we argue that the on-demand streaming platforms (e.g. Spotify and Apple Music) have allowed consumers to easily access music products but have introduced a level of intermediation between artists and customers leading to inefficiency of the royalty payments systems. The goal of this research is to identify blockchain applications that would enable the disintermediation of the industry, allowing artists to create and capture more value from their own products. This paper discusses some applications and concepts related to blockchain, including smart contracts, record keeping, revenue management, and metadata analysis. By presenting some examples, we assess the current state of the technology's development in the music industry, how companies are introducing this new model into the market, and some limitations these models may have.
Sitonio, Camila
Nucciarelli, Alberto
2018
Quantifying Brexit: From Ex Post to Ex Ante Using Structural Gravity
http://d.repec.org/n?u=RePEc:ces:ceswps:_7357&r=all
Exploiting changes in the geography of economic integration in Europe, this paper uses detailed bilateral trade data for 50 sectors to carry out an econometric ex post evaluation of the trade cost effects of the United Kingdom’s various arrangements with the European Union. The analysis reveals important heterogeneity across agreements, sectors, and within pairs. In particular, the EU’s eastward enlargement or the EU-Korea trade agreement have lowered the UK’s outward trade costs only relatively modestly. These asymmetries matter for the size and distribution of the welfare effects of Brexit – the withdrawal of the UK from EU agreements resulting into a return of trade costs to the situation quo ante. We make this point with the help of a modern multi-sector trade model that is able to capture inter- and intranational production networks. In line with other papers, the welfare costs of Brexit are higher in the UK than in most other EU countries. However, the considered asymmetries tend to attenuate overall costs while giving rise to substantial heterogeneity between EU27 members and sectors.
Gabriel Felbermayr
Jasmin Katrin Gröschl
Marina Steininger
structural gravity, European trade integration, general equilibrium, quantitative trade models, Brexit
2018
Getting Life Expectancy Estimates Right for Pension Policy: Period versus Cohort Approach
http://d.repec.org/n?u=RePEc:ces:ceswps:_7349&r=all
In many policy areas it is essential to use the best estimates of life expectancy, but it is vital to most areas of pension policy. This paper presents the conceptual differences between static period and dynamic cohort mortality tables, estimates the differences in life expectancy for Portugal and Spain, and compares official estimates of both life expectancy estimates for Australia, the United Kingdom, and the United States for 1981, 2010, and 2060. These comparisons reveal major differences between period and cohort life expectancy in and between countries and across years. The implications of using wrong estimates for pension policy, including financial sustainability, are explored.
Mercedes Ayuso
Jorge Miguel Bravo
Robert Holzman
cross-country comparison, Lee-Carter, life expectancy indexation, balancing mechanism
2018
Optimal Transport on the Probability Simplex with Logarithmic Cost
http://d.repec.org/n?u=RePEc:arx:papers:1812.00032&r=all
Motivated by the financial problem of building financial portfolios which outperform the market, Pal and Wong considered optimal transport on the probability simplex $\triangle^n$ where the cost function is induced by the free energy. We study the regularity of this problem and find that the associated $MTW$ tensor is non-negative definite and in fact constant on $\triangle^n \times \triangle^n$. We further find that relative $c$-convexity corresponds to the standard notion of convexity in the probability simplex. Hence, we are able to use standard results in optimal transport to establish regularity for the optimal transport maps considered by Pal and Wong. We also provide several new examples of costs satisfying the $MTW(0)$ condition.
Gabriel Khan
Jun Zhang
2018-11
Forms of Democracies and Macroeconomic Volatility: An Exploration of the Political Institutions Black-Box
http://d.repec.org/n?u=RePEc:hal:journl:hal-01903680&r=all
Although the empirical literature on the determinants of economic growth volatility highlights a robust stabilizing effect of democratic regimes compared to dictatorships, no study focused so far on identifying the precise political institutions explaining this stabilizing effect. We open the political institutions black-box associated to democratic regimes, and study the effects of disaggregated political institutions on macroeconomic volatility along five institutional dimensions, namely forms of government, electoral rules, state forms, the number of veto players, and the age of democracies. Using a large panel of 140 countries over 1975-2007, we show that institutional details are of crucial importance, since the stabilizing effect of democracies depends on the precise institutional dimensions at work. Thus, our study contributes to the institutional design debate, by showing that the simple promotion of democratic regimes might not be sufficient to foster a more stable development path.
Clément Mathonnat
Alexandru Minea
Political Institutions,Macroeconomic Volatility,Positive Constitutional Economics,Comparative Politics,Economic Development
2018
Kartele jako przedmiot polityki gospodarczej
http://d.repec.org/n?u=RePEc:pra:mprapa:90364&r=all
The present article shows and discusses the economic problems of market cartelization, and perceives cartels as objects of public policy and interest. In this paper, the term ‘cartel’ has been profoundly explained and elaborated, and the selected examples of industry cartelization, coming both from the Polish national economy and economy of the whole European Union, have been presented. Next, the discussion has been set in relevant economic theories that allow to interpret cartel behavior from the viewpoint of regulators (policy-makers) or in the light of collusion detection mechanisms.
Karbowski, Adam
Kryśkiewicz, Łukasz
Prokop, Jacek
Cartels; Public Policy
2018
Opening up on consumer materialism
http://d.repec.org/n?u=RePEc:tiu:tiutis:a21cb1c8-5af1-46cc-9ea0-aab0c6344a25&r=all
This dissertation comprises three main empirical essays, and a final chapter that synthesizes the findings and provides additional empirical evidence. The dissertation challenges current dominant theories of consumer materialism that have an overly aggregated, and overly negative, perspective of this consumer value. It shows that the three materialism dimensions have vastly different relationships with related variables, and even have positive consequences for consumers. The first essay examines age effects on materialism while controlling for birth cohort and period effects. It finds that materialism follows a curvilinear trajectory across the lifespan, with the lowest levels at middle age and higher levels before and after that. Essay 2 examines the implications of materialism for consumer savings and finds that materialism has both negative and positive effects on savings over time. Essay 3 examines the dynamic relationships between materialism and subjective well-being over time, and finds that the negative relationship between materialism and well-being is reciprocal, and due to only one of the three materialism dimensions. The other two materialism dimensions have positive effects on consumer well-being. The final chapter provides additional evidence demonstrating the differential and sometimes positive consequences of the materialism dimensions for consumers, and interrelates the findings.
Jaspers, Esther
2018
Emerging market multinational companies and internationalization: the role of home country urbanization
http://d.repec.org/n?u=RePEc:ehl:lserod:68350&r=all
We develop a multilevel theoretical framework for investigating the role of home country urbanization for emerging market multinational companies' (EMNCs) international expansion. We propose that more urbanized home environments directly increase EMNC's proclivity to internationalize and moderate the effects of firm intangible and tangible resources. The empirical counterpart studies 592 EMNCs from 18 different countries in 2010 and an unbalanced panel of a subsample of these firms over the period 2006–2010. Our hypotheses are confirmed in both datasets. We find that while urbanization complements firm financial resources when expanding abroad, it appears to substitute to some extent for internal R&D capabilities. Our findings further our understanding of the drivers of internationalization of EMNCs.
Estrin, Saul
Nielsen, Bo B.
Nielsen, Sabina
Emerging market multinationals; Internationalization; Home country effects; Urbanization; Financial strength; Cross-classified; Multilevel modeling
2017-09-01
The role of prepayment penalties in mortgage loans
http://d.repec.org/n?u=RePEc:ehl:lserod:81841&r=all
We study the effect of mortgage prepayment penalties on borrowers’ prepayments and delinquencies by exploiting a 2007 reform in Italy that reduced penalties on outstanding mortgages and banned penalties on newly-issued mortgages. Using a unique dataset of mortgages issued by a large Italian lender, we provide evidence that: 1) before the reform, mortgages issued to riskier borrowers included larger penalties; 2) higher prepayment penalties decreased borrowers’ prepayments; and 3) higher prepayment penalties did not affect borrowers’ delinquencies. Moreover, we find suggestive evidence that prepayment penalties affected mortgage pricing, as well as prepayments and delinquencies through borrowers’ mortgage selection at origination, most notably for riskier borrowers.
Beltratti, Andrea
Benetton, Matteo
Gavazza, Alessandro
mortgages; prepayment penalties; refinancing; default
2017-09-01
Debt Hangover in the Aftermath of the Great Recession
http://d.repec.org/n?u=RePEc:gat:wpaper:1829&r=all
Following the Great Recession, U.S. government debt levels exceeded 100% of output. We develop a macroeconomic model to evaluate the role of various shocks during and after the Great Recession; labor market shocks have the greatest impact on macroeconomic activity. We then evaluate the consequences of using alternative fiscal policy instruments to implement a fiscal austerity program to return the debt-output ratio to its pre-Great Recession level. Our welfare analysis reveals that there is not much difference between applying fiscal austerity through government spending, the labor income tax, or the consumption tax; using the capital income tax is welfare-reducing.
Stéphane Auray
Aurélien Eyquem
Paul Gomme
Fiscal policies, tax reforms, government debt, government deficits
2018
Subsidizing Labor Hoarding in Recessions: The Employment & Welfare Effects of Short Time Work
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13310&r=all
The Great Recession has seen a revival of interest in policies encouraging labor hoarding by firms. Short time work (STW) policies, which consist in offering subsidies for hours reductions to workers in firms experiencing temporary shocks, are the most emblematic of these policies, and have been used aggressively during the recession. Yet, very little is known about their employment and welfare consequences. This paper leverages unique administrative social security data from Italy and quasi-experimental variation in STW policy rules to offer compelling evidence of the effects of STW on firms' and workers' outcomes, and on reallocation in the labor market. Our results show large and significant negative effects of STW treatment on hours, but large and positive effects on headcount employment. Results also show that employment effects disappear when the program stops, and that STW offers no long term insurance to workers. Finally, we identify the presence of significant negative reallocation effects of STW on employment growth of untreated firms in the same local labor market. We develop a simple conceptual framework to rationalize this empirical evidence, from which we derive a general formula for the optimal STW subsidy that clarifies the welfare trade-offs of STW policies. Calibrating the model to our empirical evidence, we conduct counterfactual policy analysis and show that STW stabilized employment during the Great Recession in Italy, and brought (small) positive welfare gains.
Giupponi, Giulia
Landais, Camille
2018-11
The effect of immigrant peers in vocational schools
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13305&r=all
This paper provides new evidence on how the presence of immigrant peers in the classroom affects native student achievement. The analysis is based on longitudinal administrative data on two cohorts of vocational training students in Italy's largest region. Vocational training institutions provide the ideal setting for studying these effects because they attract not only disproportionately high shares of immigrants but also the lowest ability native students. We adopt a value added model, and exploit within-school variation both within and across cohorts for identification. Our results show small negative average effects on maths test scores that are larger for low ability native students, strongly non-linear and only observable in classes with a high (top 20%) immigrant concentration. These outcomes are driven by classes with a high average linguistic distance between immigrants and natives, with no apparent additional role played by ethnic diversity.
Frattini, Tommaso
Meschi, Elena
education; ethnic diversity; Immigration; linguistic distance; peer effects
2018-11
Learning from Noise: Evidence from India's IPO Lotteries
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13314&r=all
We study a natural experiment in which 1.5 million investors participate in allocation lotteries for Indian IPO stocks. Randomized IPO gains cause winning investors to increase applications to future IPOs and substantially increase portfolio trading volume in non-IPO stocks relative to lottery losers; the effects are symmetrically negative for experienced losses. Investors who have received multiple past IPO allocations show smaller responses, suggesting learning/selection moderates responses to noise shocks. The evidence is most consistent with investors learning about their own ability from experienced noise, drawing inferences about their skill from luck.
Anagol, Santosh
Balasubramaniam, Vimal
Ramadorai, Tarun
causal inference; experience; India; investment; learning; lotteries
2018-11
The Household Finance Landscape in Emerging Economies
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13318&r=all
We survey the household finance landscape in emerging economies. We first present statistics on household balance sheets from official micro-surveys in countries comprising 45% of the global population: China, India, Bangladesh, Philippines, Thailand, and South Africa. We contrast these patterns with those in data from advanced economies. We then survey the nascent literature on household finance in emerging economies and discuss areas of overlap with the more well-established literature on household finance in advanced economies, as well as the large body of literature on development finance. We highlight useful directions for future research.
Badarinza, Cristian
Balasubramaniam, Vimal
Ramadorai, Tarun
credit; Development; emerging economies; household finance; Insurance; real estate
2018-11
Information Nudges and Self-Control
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13299&r=all
We study the optimal design of information nudges for present-biased consumers who have to make sequential consumption decisions without exact prior knowledge of their long-term consequences. For arbitrary distributions of risk, there exists a consumer-optimal information nudge that is of cutoff type, recommending consumption or abstinence according to the magnitude of the risk. Under a stronger bias for the present, the target group receiving a credible signal to abstain must be tightened. We compare this nudge with those favored by a health authority or a lobbyist. When some consumers are more strongly present-biased than others, a traffic-light nudge is optimal.
Mariotti, Thomas
Schweizer, Nikolaus
Szech, Nora
von Wangenheim, Jonas
information design; Information Nudges; Present-Biased Preferences; Self-Control
2018-11
Equitable Voting Rules
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13316&r=all
A celebrated result in social choice is May's Theorem (May, 1952), providing the foundation for majority rule. May's crucial assumption of symmetry, often thought of as a procedural equity requirement, is violated by many choice procedures that grant voters identical roles. We show that a modification of May's symmetry assumption allows for a far richer set of rules that still treat voters equally, but have minimal winning coalitions comprising a vanishing fraction of the population. We conclude that procedural fairness can coexist with the empowerment of a small minority of individuals. Methodologically, we introduce techniques from discrete mathematics and illustrate their usefulness for the analysis of social choice questions.
Bartholdi, Laurent
Hann-Caruthers, Wade
Josyula, Maya
Tamuz, Omer
Yariv, Leeat
equity; Finite Groups; May's Theorem; Social Choice; Voting rules
2018-11
Climatic Roots of Loss Aversion
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13313&r=all
This research explores the origins of loss aversion and the variation in its prevalence across regions, nations and ethnic group. It advances the hypothesis and establishes empirically that the evolution of loss aversion in the course of human history can be traced to the adaptation of humans to the asymmetric effects of climatic shocks on reproductive success during the epoch in which subsistence consumption was a binding constraint. Exploiting regional variations in the vulnerability to climatic shocks and their exogenous changes in the course of the Columbian Exchange, the research establishes that consistent with the predictions of the theory, individuals and ethnic groups that are originated in regions marked by greater climatic volatility have higher predisposition towards loss-neutrality, while descendants of regions in which climatic conditions tended to be spatially correlated, and thus shocks were aggregate in nature, are characterized by greater intensity of loss aversion.
Galor, Oded
Savitskiy, Viacheslav
2018-11
Barriers to trade in environmental goods: How Important they are and what should developing countries expect from their removal
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13320&r=all
Few developing countries have participated in the environmental goods agreement (EGA) negotiations to reduce barriers on trade in Environmental Goods (EGs). Reasons for this reluctance are first reviewed along with a comprehensive description of barriers to trade (tariffs and NTBs) on two lists of EGs used in negotiations comprised mostly industrial products (The APEC and WTO lists), and a third, a list of Environmentally Preferable Products (EPPs) more representative of the perceived interests of developing countries. The paper then revisits and extends the literature on the estimation of barriers to trade in EGs for these lists. These estimates are carried out with a structural gravity model and new data: (i) on bilateral (rather than MFN) tariffs, and; (ii) with a measure of regulatory overlap in bilateral trade to capture the often-observed pattern of greater bilateral trade among countries that share similar regulatory regimes. Results show that tariffs generally reduce the intensity of bilateral trade, often with little difference in statistical significance between the EG and non-EG group for each list. Regulatory harmonization, as captured by an increase in regulatory overlap is also estimated to be conducive to more intense bilateral trade.
de Melo, Jaime
Solleder, Jean-Marc
Environmental Goods; NTBs; tariffs
2018-11
Quantitative Easing
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13322&r=all
Abstract Is Quantitative Easing (QE) an effective substitute for conventional monetary policy? We study this question using a quantitative heterogeneous-agents model with nominal rigidities, as well as liquid and partially liquid wealth. The direct effect of QE on aggregate demand is determined by the difference in marginal propensities to consume out of the two types of wealth, which is large according to the model and empirical studies. A comparison of optimal QE and interest rate rules reveals that QE is indeed a very powerful instrument to anchor expectations and to stabilize output and inflation. However, QE interventions come with strong side effects on inequality, which can substantially lower social welfare. A very simple QE rule, which we refer to as Real Reserve Targeting, is approximately optimal from a welfare perspective when conventional policy is unavailable. We further estimate the model on U.S. data and find that QE interventions greatly mitigated the decline in output during the Great Recession.
Cui, Wei
Sterk, Vincent
HANK; Large-scale asset purchases; monetary policy
2018-11
Populism and Civil Society
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13306&r=all
Populists claim to be the only legitimate representative of the people. Does it mean that there is no space for civil society? The issue is important because since Tocqueville (1835), associations and civil society have been recognized as a key factor in a healthy liberal democracy. We ask two questions: 1) do individuals who are members of civil associations vote less for populist parties? 2) does membership to associations decrease when populist parties are in power? We answer these questions looking at the experiences of Europe, which has a rich civil society tradition, as well as of Latin America, which has already a long history of populists in power. The main findings are that individuals belonging to associations are less likely by 2.4 to 4.2 percent to vote for populist parties, which is large considering that the average vote share for populist parties is between 10 and 15 percent. The effect is strong particularly after the global financial crisis, with the important caveat that membership to trade unions has unclear effects.
Boeri, Tito
Mishra, Prachi
Papageorgiou, Chris
Spilimbergo, Antonio
associations; democracy; Europe; Latin America; populist parties; voting
2018-11
The introduction of serfdom and labor markets
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13303&r=all
We provide evidence of how restrictions on labor mobility, such as serfdom and other types of labor coercion, impact labor market outcomes. To do so, we estimate the impact of a large negative shock to labor mobility in the form of the reintroduction of serfdom in Denmark in 1733, which was targeted at limiting the mobility of farmhands. Using a unique data source based on the archives of estates from the eighteenth century, we test whether serfdom affected the wages of farmhands more strongly than other groups in the labor market, and results based on a differences-in-differences approach reveal evidence consistent with a strong negative effect following its introduction. We also investigate whether one mechanism was that boys with rural backgrounds were prevented from taking up apprenticeships in towns, and find suggestive evidence that this was indeed the case. Thus, our results suggest that serfdom was effectively reducing mobility.
Jensen, Peter Sandholt
Radu, Cristina Victoria
Severgnini, Battista
Sharp, Paul
coercion; labor mobility; serfdom
2018-11
Volatility Risk Pass-Through
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13325&r=all
We develop a novel measure of volatility pass-through to assess international propagation of output volatility shocks to macroeconomic aggregates, equity prices, and currencies. An increase in country's output volatility is associated with a decrease in its output, consumption, and net exports. The average consumption pass-through is 50% (a 1% increase in output volatility increases consumption volatility by 0.5%) and it increases to 70% for shocks originating in smaller countries. The equity volatility pass-through is 90%, whereas the link between volatility of currency and fundamentals is weak. A novel channel of risk sharing of volatility risks can explain our empirical findings.
Colacito, Riccardo
Croce, Mariano Massimiliano
Liu, Yang
Shaliastovich, Ivan
foreign exchange disconnect; Risk Sharing; Volatility pass-through
2018-11
Anti-social Behavior in Groups
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13315&r=all
This paper provides strong evidence supporting the long-standing speculation that decision-making in groups has a dark side, by magnifying the prevalence of anti-social behavior towards outsiders. A large-scale experiment implemented in Slovakia and Uganda (N=2,309) reveals that deciding in a group with randomly assigned peers increases the prevalence of anti-social behavior that reduces everyone's but which improves the relative position of own group. The effects are driven by the influence of a group context on individual behavior, rather than by group deliberation. The observed patterns are strikingly similar on both continents.
Želinský, Tomáš
Bauer, Michal
Cahlíková, Jana
Celik-Katreniak, Dagmara
Chytilova, Julie
Cingl, Lubomír
2018-11
Habits as Adaptations: An Experimental Study
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13300&r=all
Psychologists emphasize two aspects of habit formation: (i) habits arise when the history of a decision process correlates with optimal continuation actions, and (ii) habits alleviate cognition costs. We ask whether serial correlation of optimal actions alone induces habits or if, instead, habits form as optimal adaptations. We compare lab treatments that differ in the information provided to subjects, holding fixed the serial correlation of optimal actions. We find that past actions affect behavior only in the treatment in which this habit is useful. The result suggests that caution is warranted when modeling habits via a fixed utility over action sequences.
Matyskova, Ludmila
Rogers, Brian
Steiner, Jakub
Sun, Keh-Kuan
Habit formation; rational inattention
2018-11
Germs, Social Networks and Growth
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13312&r=all
Does the pattern of social connections between individuals matter for macroeconomic outcomes? If so, where do these differences come from and how large are their effects? Using network analysis tools, we explore how different social network structures affect technology diffusion and thereby a country's rate of growth. The correlation between high-diffusion networks and income is strongly positive. But when we use a model to isolate the effect of a change in social networks, the effect can be positive, negative, or zero. The reason is that networks diffuse ideas and disease. Low-diffusion networks have evolved in countries where disease is prevalent because limited connectivity protects residents from epidemics. But a low-diffusion network in a low-disease environment needlessly compromises the diffusion of good ideas. In general, social networks have evolved to fit their economic and epidemiological environment. Trying to change networks in one country to mimic those in a higher-income country may well be counterproductive.
Fogli, Alessandra
Veldkamp, Laura
Development; disease; economic networks; growth; pathogens; Social Networks; technology diffusion
2018-11
Efectos de desbordamiento sobre los mercados financieros de Colombia. Identificación a través de la heterocedasticidad
http://d.repec.org/n?u=RePEc:pra:mprapa:90422&r=all
La investigación cuantifica y analiza los efectos de los choques originados en los mercados estadounidenses sobre los principales mercados financieros colombianos. Para cumplir con este objetivo se emplea la información diaria de los mercados de dinero, bonos, acciones y tipo de cambio entre Colombia y EE.UU. durante el periodo de Enero 2003 y Enero 2015. La metodología utilizada es un modelo VAR estructural que emplea la heterocedasticidad que existe en los datos para la identificación y la estimación de los coeficientes de transmisión financiera. Se encuentra que los mercados estadounidenses generan efectos overall spillovers significativos sobre el mercado accionario colombiano. A su vez, los resultados reflejan la posición dominante del mercado de bonos estadounidenses como el motor de los efectos de desbordamiento.
Sandoval Paucar, Giovanny
Choques financieros, precios de activos, Modelos SVAR-IH, Heterocedasticidad
2018-12-07
Some higher education issues in Muslim countries With reference to Islamic economics and finance
http://d.repec.org/n?u=RePEc:pra:mprapa:90376&r=all
The purpose of this paper is (i) to state the objectives of higher education commensurate with Islamic requirements; (ii) to examine the current state of higher education in Muslim majority countries with reference to Islamic economics and finance (iii) to present a few suggestions for improvement The constraints of space, time and resources at our disposal do not permit us to present an all covering blue print on this vital subject. Instead of dealing with specifics, we shall focus on attitudinal and directional issues of evolution. We shall use data from Human Development Reports and the RePEc Archive for OIC member countries for our work. A comprehension of the desired magnitude may be lacking and we are conscious of the limitations of the approach the paper takes to the problem. Yet, we expect the exercise to be rewarding in lighting up a few dark corners in the area.
Hasan, Zubair
Objectives of education; Islamic economics and Issues in higher learning; remedial action.
2018-12-05
Elite Schools and Opting-In: Effects of College Selectivity on Career and Family Outcomes
http://d.repec.org/n?u=RePEc:nbr:nberwo:25315&r=all
Using College and Beyond data and a variant on Dale and Krueger's (2002) matched-applicant approach, this paper revisits the question of how attending an elite college affects later-life outcomes. We expand the scope along two dimensions: we do not restrict the sample to full-time full-year workers and we examine labor force participation, human capital, and family formation. For men, our findings echo those in Dale and Krueger (2002): controlling for selection eliminates the positive relationship between college selectivity and earnings. We also find no significant effects on men's educational or family outcomes. The results are quite different for women: we find effects on both career and family outcomes. Attending a school with a 100-point higher average SAT score increases women's probability of advanced degree attainment by 5 percentage points and earnings by 14 percent, while reducing their likelihood of marriage by 4 percentage points. The effect of college selectivity on own earnings is significantly larger for married than for single women. Among married women, selective college attendance significantly increases spousal education.
Suqin Ge
Elliott Isaac
Amalia Miller
2018-11
An Institutional Analysis of American Job Centers: Key Institutional Features of American Job Centers
http://d.repec.org/n?u=RePEc:mpr:mprres:6dc8fa712e604bc28203c2464461370c&r=all
This paper presents an overview of key institutional features of the American Job Center (AJC) service delivery system across the country.
Elizabeth Brown
Pamela Holcomb
AJC, job, WIOA, workforce, service delivery, operations, employment
Treatment Effects with Multiple Outcomes
http://d.repec.org/n?u=RePEc:nbr:nberwo:25307&r=all
This paper proposes strategies for defining, identifying, and estimating features of treatment-effect distributions in contexts where multiple outcomes are of interest. After describing existing empirical approaches used in such settings, the paper develops a notion of treatment preference that is shown to be a feature of standard treatment-effect analysis in the single-outcome case. Focusing largely on binary outcomes, treatment-preference probability treatment effects (PTEs) are defined and are seen to correspond to familiar average treatment effects in the single-outcome case. The paper suggests seven possible characterizations of treatment preference appropriate to multiple-outcome contexts. Under standard assumptions about unconfoundedness of treatment assignment, the PTEs are shown to be point identified for three of the seven characterizations and set identified for the other four. Probability bounds are derived and empirical approaches to estimating the bounds—or the PTEs themselves in the point-identified cases—are suggested. These empirical approaches are straightforward, involving in most instances little more than estimation of binary-outcome probability models of what are commonly known as composite outcomes. The results are illustrated with simulated data and in analyses of two microdata samples. Finally, the main results are extended to situations where the component outcomes are ordered or categorical.
John Mullahy
2018-11
Taking Time Use Seriously: Income, Wages And Price Discrimination
http://d.repec.org/n?u=RePEc:nbr:nberwo:25308&r=all
The American Time Use Survey 2003-15, the French Enquête Emploi du Temps, 2009-10, and the German Zeitverwendungserhebung, 2012-13, have sufficient observations to allow examining the theory of household production in much more detail than ever before. We identify income effects on time use by non-workers, showing that relatively time-intensive commodities—sleep and TV-watching—are inferior. For workers we identify income and substitution effects separately, with both in the same direction on these commodities as the income effects among non-workers. We rationalize the results by generalizing Becker’s (1965) “commodity production” model, allowing both substitution between time and goods in household production and substitution among commodities in utility functions. We then use the evidence of price discrimination in product markets against minorities in the U.S. and immigrants in France to motivate an extension of the model that predicts how household production differs between members of these groups and the majority. We find the predicted results—minorities engage in more time-intensive activities, sleep and TV-watching, than otherwise identical majority-group members.
Daniel S. Hamermesh
Jeff Biddle
2018-11
The Effect of the Economic Collapse in Iceland on the Probability of Cardiovascular Events
http://d.repec.org/n?u=RePEc:nbr:nberwo:25301&r=all
We explore whether the 2008 economic collapse in Iceland and subsequent economic crisis affected the probability of ischemic heart disease (IHD) events, independent of regular cyclical effects attributed to typical economic conditions. We estimate linear probability models using administrative data on IHD events, earnings and balance-sheet status, as well as unemployment for all Icelanders aged 16 and older in 2000-2014. We find that the sharp change in economic conditions in 2008 had a positive long-term effect on the probability of cardiovascular events in both males and females. In absolute terms these effects were small but often statistically significant and contrast with the finding that general business-cycle fluctuations operated in the opposite direction. Several potential mediators were correlated with the probability of IHD events, but their inclusion had little effect on the estimated economic crisis coefficients. A statistically significant business-cycle effect is found for both genders indicating. Thus the general business cycle and the economic collapse in 2008 and subsequent crisis can be thought of as separate phenomena with differing effects on IHD. This research contributes to the literature by exploiting a unique circumstance affecting a whole population to explore its effects on individuals, using exceptional register data.
Kristín H. Birgisdóttir
Arna Hauksdóttir
Christopher J. Ruhm
Unnur Anna Valdimarsdóttir
Tinna Laufey Ásgeirsdóttir
2018-11
Money Markets, Collateral and Monetary Policy
http://d.repec.org/n?u=RePEc:nbr:nberwo:25319&r=all
Interbank money markets have been subject to substantial impairments in the recent decade, such as a decline in unsecured lending and substantial increases in haircuts on posted collateral. This paper seeks to understand the implications of these developments for the broader economy and monetary policy. To that end, we develop a novel general equilibrium model featuring heterogeneous banks, interbank markets for both secured and unsecured credit, and a central bank. The model features a number of occasionally binding constraints. The interactions between these constraints - in particular leverage and liquidity constraints - are key in determining macroeconomic outcomes. We find that both secured and unsecured money market frictions force banks to either divert resources into unproductive but liquid assets or to de-lever, which leads to less lending and output. If the liquidity constraint is very tight, the leverage constraint may turn slack. In this case, there are large declines in lending and output. We show how central bank policies which increase the size of the central bank balance sheet can attenuate this decline.
Fiorella De Fiore
Marie Hoerova
Harald Uhlig
2018-11
The Propagation of Monetary Policy Shocks in a Heterogeneous Production Economy
http://d.repec.org/n?u=RePEc:nbr:nberwo:25303&r=all
We study the transmission of monetary policy shocks in a model in which realistic heterogeneity in price rigidity interacts with heterogeneity in sectoral size and input-output linkages, and derive conditions under which these heterogeneities generate large real effects. Empirically, heterogeneity in the frequency of price adjustment is the most important driver behind large real effects, whereas heterogeneity in input-output linkages contributes only marginally, with differences in consumption shares in between. Heterogeneity in price rigidity further is key in determining which sectors are the most important contributors to the transmission of monetary shocks, and is necessary but not sufficient to generate realistic output correlations. In the model and data, reducing the number of sectors decreases monetary non-neutrality with a similar impact response of inflation. Hence, the initial response of inflation to monetary shocks is not sufficient to discriminate across models and for the real effects of nominal shocks.
Ernesto Pastén
Raphael Schoenle
Michael Weber
2018-11
The Causal Link between Relative Age Effect and Entrepreneurship: Evidence from 17 Million Users across 49 Years on Taobao
http://d.repec.org/n?u=RePEc:nbr:nberwo:25318&r=all
We use an extensive panel of 17 million individuals born between 1947 and 1995 from China’s largest online marketplace, Taobao, to study the impact of RAE on the propensity to become an entrepreneur. Using events surrounding the Cultural Revolution and the issuance of the Compulsory Education Law whereby COD policies varied, we conceptualize a natural experiment to identify the RAE effects. The youngest students are 5.4% less likely to become an entrepreneur compared to the oldest within the cohort, translating to approximate 43.7 thousand additional sellers born in September with an estimated USD 1.29 billion in additional annual sales.
Youwei Wang
Yuxin Chen
Yi Qian
2018-11
Unions and Wage Inequality: The Roles of Gender, Skill and Public Sector Employment
http://d.repec.org/n?u=RePEc:nbr:nberwo:25313&r=all
We examine the changing relationship between unionization and wage inequality in Canada and the United States. Our study is motivated by profound recent changes in the composition of the unionized workforce. Historically, union jobs were concentrated among low-skilled men in private sector industries. With the steady decline in private sector unionization and rising influence in the public sector, half of unionized workers are now in the public sector. Accompanying these changes was a remarkable rise in the share of women among unionized workers. Currently, approximately half of unionized employees in North America are women. While early studies of unions and inequality focused on males, recent studies find that unions reduce wage inequality among men but not among women. In both countries we find striking differences between the private and public sectors in the effects of unionization on wage inequality. At present, unions reduce economy-wide wage inequality by less than 10%. However, union impacts on wage inequality are much larger in the public sector. Once we disaggregate by sector the effects of unions on male and female wage inequality no longer differ. The key differences in union impacts are between the public and private sectors – not between males and females.
David Card
Thomas Lemieux
W. Craig Riddell
2018-11
Policy Evolution under the Clean Air Act
http://d.repec.org/n?u=RePEc:nbr:nberwo:25309&r=all
The U.S. Clean Air Act, passed in 1970 with strong bipartisan support, was the first environmental law to give the Federal government a serious regulatory role, established the architecture of the U.S. air pollution control system, and became a model for subsequent environmental laws in the United States and globally. We outline the Act’s key provisions, as well as the main changes Congress has made to it over time. We assess the evolution of air pollution control policy under the Clean Air Act, with particular attention to the types of policy instruments used. We provide a generic assessment of the major types of policy instruments, and we trace and assess the historical evolution of EPA’s policy instrument use, with particular focus on the increased use of market-based policy instruments, beginning in the 1970s and culminating in the 1990s. Over the past fifty years, air pollution regulation has gradually become much more complex, and over the past twenty years, policy debates have become increasingly partisan and polarized, to the point that it has become impossible to amend the Act or pass other legislation to address the new threat of climate change.
Richard Schmalensee
Robert N. Stavins
2018-11
Women, Wealth Effects, and Slow Recoveries
http://d.repec.org/n?u=RePEc:nbr:nberwo:25311&r=all
Business cycle recoveries have slowed in recent decades. This slowdown comes entirely from female employment: as women's employment rates converged towards men's over the past half-century, the growth rate of female employment slowed. We ask whether this slowdown in female employment caused the slowdown in overall employment during recent business cycle recoveries. Standard macroeconomic models with “balanced growth preferences” imply that this cannot be the cause, since the entry of women “crowds out” men in the labor market almost one-for-one. We estimate the extent of crowd out of men by women in the labor market using state-level panel data and find that it is small, contradicting the standard model. We show that a model with home production by women can match our low estimates of crowd out. This model – calibrated to match our cross-sectional estimate of crowd out – implies that 70% of the slowdown in recent business cycle recoveries can be explained by female convergence.
Masao Fukui
Emi Nakamura
Jón Steinsson
2018-11
Occasional Bulletin of Economic Notes 2018/02- Update to the Quarterly Projection Model
http://d.repec.org/n?u=RePEc:rbz:oboens:8879&r=all
Byron Botha
Franz Ruch
Rudi Steinbach
2018-11-06
Transitional Dynamics in Aggregate Models of Innovative Investment
http://d.repec.org/n?u=RePEc:nbr:nberwo:25321&r=all
What quantitative lessons can we learn from models of endogenous technical change through innovative investments by firms for the impact of changes in the economic environment on the dynamics of aggregate productivity in the short, medium, and long run? We present a unifying model that nests a number of canonical models in the literature and characterize their positive implications for the transitional dynamics of aggregate productivity and their welfare implications in terms of two sufficient statistics. We review the current state of measurement of these two sufficient statistics and discuss the range of positive and normative quantitative implications of our model for a wide array of counterfactual experiments, including the link between a decline in the entry rate of new firms and a slowdown in the growth of aggregate productivity given that measurement. We conclude with a summary of the lessons learned from our analysis to help direct future research aimed at building models of endogenous productivity growth useful for quantitative analysis.
Andrew Atkeson
Ariel Burstein
Manolis Chatzikonstantinou
2018-11
Testing, Stress, and Performance: How Students Respond Physiologically to High-Stakes Testing
http://d.repec.org/n?u=RePEc:nbr:nberwo:25305&r=all
A potential contributor to socioeconomic disparities in academic performance is the difference in the level of stress experienced by students outside of school. Chronic stress – due to neighborhood violence, poverty, or family instability – can affect how individuals’ bodies respond to stressors in general, including the stress of standardized testing. This, in turn, can affect whether performance on standardized tests is a valid measure of students’ actual ability. We collect data on students’ stress responses using cortisol samples provided by low-income students in New Orleans. We measure how their cortisol patterns change during high-stakes testing weeks relative to baseline weeks. We find that high-stakes testing does affect cortisol responses, and those responses have consequences for test performance. Those who responded most strongly – with either a large increase or large decrease in cortisol – scored 0.40 standard deviations lower than expected on the on the high-stakes exam.
Jennifer A. Heissel
Emma K. Adam
Jennifer L. Doleac
David N. Figlio
Jonathan Meer
2018-11
Supplemental Security Income Youth Formative Research Project: Target Population Profiles
http://d.repec.org/n?u=RePEc:mpr:mprres:bd6a15dc5c074b98b14a5825688d3c57&r=all
This report identifies potential target populations for interventions and the characteristics of youth Supplement Security Income recipients who are most likely to benefit from these strategies.
Todd Honeycutt
David Wittenburg
Michael Levere
Sarah Palmer
SSI, youth, transition, employment, supplemental security income, interventions
Low Inflation: High Default Risk AND High Equity Valuations
http://d.repec.org/n?u=RePEc:nbr:nberwo:25317&r=all
We develop an asset-pricing model with endogenous corporate policies that explains how inflation jointly impacts real asset prices and corporate default risk. Our model includes two empirically grounded nominal frictions: fixed nominal coupons and sticky profitability. Taken together, these two frictions result in higher real equity prices and credit spreads when inflation falls. An increase in inflation has opposite effects, but with smaller magnitudes. In the cross section, the model predicts the negative impact of inflation on real equity values is stronger for low leverage firms. We find empirical support for the model predictions.
Harjoat S. Bhamra
Christian Dorion
Alexandre Jeanneret
Michael Weber
2018-11
An Institutional Analysis of American Job Centers: Resource Sharing Practices Among AJCs
http://d.repec.org/n?u=RePEc:mpr:mprres:6ac1417660b746f9885908e5b717934b&r=all
This paper describes how the 40 comprehensive American Job Centers (AJCs) selected to participate in the Institutional Analysis of AJCs shared resources.
Brittany English
Sarah Osborn
AJCs, WIOA, workforce, service delivery, operations, employment, resource sharing, institutional analysis
Occasional Bulletin of Economic Notes 2018/02- The structure of South Africa’s external position
http://d.repec.org/n?u=RePEc:rbz:oboens:8878&r=all
Bojosi Morule
Daan Steenkamp
2018-11-06
Nutrition Services Program Participation and the Diet Quality of Older Adults
http://d.repec.org/n?u=RePEc:mpr:mprres:6b935cd5331c44408cfa0516ba6f2121&r=all
Congregate and home-delivered meals provided through the Title III-C Nutrition Services Program (NSP) can be an important source of nutrition for older adults.
Elizabeth Gearan
James Mabli
Katherine Niland
Nutrition, diet quality, older adults
An Institutional Analysis of American Job Centers: AJC Service Delivery in Rural Areas
http://d.repec.org/n?u=RePEc:mpr:mprres:ddb69a6f94624e719bf5a652f5c18470&r=all
As part of the Institutional Analysis of American Job Centers (AJCs) study, this paper discusses key features and experiences of 12 AJCs that are located in rural areas.
Hannah Betesh
AJC, job, WIOA, workforce, rural, service delivery, employment
A Worksheet to Select Employment Interventions That Benefit Youth
http://d.repec.org/n?u=RePEc:mpr:mprres:0f7297f22e3b459c97364a9240270788&r=all
This issue brief includes a worksheet of questions that federal policymakers can ask themselves to help identify and develop interventions to improve employment-related outcomes for youth with disabilities.
Todd Honeycutt
Michael Levere
SSI, youth, transition, employment, supplemental security income, interventions
The Power of Nutrition: Indicators for Key Nutrition Interventions
http://d.repec.org/n?u=RePEc:mpr:mprres:96172cb2b18e46beba15618ebd6d2205&r=all
The Power of Nutrition seeks to invest in evidence-based nutrition interventions in 5 to 10 high priority countries.
Anitha Sivasankaran
Anu Rangarajan
Nikita Ramchandani
Undernutrition, nutrition, nutrition indicators, lives saved tool, LiST
In the Shadows of the Government: Relationship Building During Political Turnovers
http://d.repec.org/n?u=RePEc:nbr:nberwo:25300&r=all
We document that following a turnover of the Party Secretary or mayor of a city in China, firms (especially private firms) headquartered in that city significantly increase their “perk spending.” Both the instrumental-variable-based results and heterogeneity analysis are consistent with the interpretation that the perk spending is used to build relations with local governments. Moreover, local political turnover in a city tends to be followed by changes of Chairmen or CEOs of state-owned firms that are controlled by the local government. However, the Chairmen or CEOs who have connections with local government officials are less likely to be replaced.
Hanming Fang
Zhe Li
Nianhang Xu
Hongjun Yan
2018-11
The Returns to Parental Health: Evidence from Indonesia
http://d.repec.org/n?u=RePEc:nbr:nberwo:25304&r=all
This paper investigates the economic returns to parental health. To account for potential endogeneity between parental health and child outcomes, we leverage longitudinal microdata from Indonesia to estimate individual fixed effects models. Our results show that the economic returns to parental health are high. We show that maternal health not only significantly affects her children’s health, but is also intrinsically linked to her spouse’s labor market status and earnings. Paternal health appears to be more linked to child schooling outcomes, especially for girls. When both parents are in poor health, the negative effects on their children are compounded. Additionally, the consequences of poor parental health are enduring. Longer-run effects of poor parental health manifest in a lower likelihood of high school completion, fewer years of schooling, and poorer adult health.
Dara Lee Luca
David E. Bloom
2018-11
Occasional Bulletin of Economic Notes 2018/01- Crowding out- diagnosing South Africa’s stubborn current account deficit
http://d.repec.org/n?u=RePEc:rbz:oboens:8886&r=all
David Fowkes
Thulisile Radebe
Sihle Nomdebevana
2018-11-06
Occasional Bulletin of Economic Notes 2018/02-Capital inflows and domestic credit- The South African "exception"
http://d.repec.org/n?u=RePEc:rbz:oboens:8880&r=all
Jean-François Mercier
2018-11-06
Do Children Benefit from Internet Access? Experimental Evidence from Peru
http://d.repec.org/n?u=RePEc:nbr:nberwo:25312&r=all
This paper provides experimental evidence for the impact of home internet access on a broad range of child outcomes in Peru. We compare children who were randomly chosen to receive laptops with high-speed internet access to (i) those who did not receive laptops and (ii) those who only received laptops without internet. We find that providing free internet access led to improved computer and internet proficiency relative to those without laptops and improved internet proficiency compared to those with laptops only. However, there were no significant effects of internet access on math and reading achievement, cognitive skills, self-esteem, teacher perceptions, or school grades when compared to either group. We explore reasons for the absence of impacts on these key outcomes with survey questions, time-diaries, and computer logs.
Ofer Malamud
Santiago Cueto
Julian Cristia
Diether W. Beuermann
2018-11
An Institutional Analysis of American Job Centers: One-Stop Operators of the AJC System
http://d.repec.org/n?u=RePEc:mpr:mprres:037752a42b9348e1af6d9bbe460fcb2c&r=all
This paper describes the role and activities of One-Stop Operators in 40 comprehensive American Job Centers (AJCs).
Kate Dunham
Deborah Kogan
AJC, job, WIOA, workforce, one-stop resources, employment
Free for Children? Patient Cost-sharing and Healthcare Utilization
http://d.repec.org/n?u=RePEc:nbr:nberwo:25306&r=all
This study exploits over 5,000 variations in subsidy generosity across ages and municipalities in Japan to examine how children respond to healthcare prices. We find that free care significantly increases outpatient spending, with price elasticities considerably smaller than for adults. Price responses are substantially larger when small copayments are introduced, indicating more elastic demand around a zero price. We also find that increased utilization primarily reflects low-value and costly care: increased outpatient spending neither reduces subsequent hospitalization by “avoidable” conditions nor improves short- or medium-term health outcomes. By contrast, inappropriate use of antibiotics and costly after-hours visits increase.
Toshiaki Iizuka
Hitoshi Shigeoka
2018-11
Information Costs and Sequential Information Sampling
http://d.repec.org/n?u=RePEc:nbr:nberwo:25316&r=all
We propose a new approach to modeling the cost of information structures in rational inattention problems, the "neighborhood-based" cost functions. These cost functions have two properties that we view as desirable: they summarize the results of a sequential evidence accumulation problem, and they capture notions of "perceptual distance." The first of these properties is connected to an extensive literature in psychology and neuroscience, and the second ensures that neighborhood-based cost functions, unlike mutual information, make accurate predictions about behavior in perceptual experiments. We compare the implications of our neighborhood-based cost functions with those of a mutual-information cost function in a series of applications: security design, global games, modeling perceptual judgments, and a linear-quadratic-Gaussian tracking problem.
Benjamin Hébert
Michael Woodford
2018-11
Youth Populations that Could Benefit from Employment Interventions
http://d.repec.org/n?u=RePEc:mpr:mprres:59ebf46ee59a44f880195a42857b8dea&r=all
This issue brief highlights three groups of potential target population for transition interventions for youth with disabilities.
Todd Honeycutt
David Wittenburg
Michael Levere
Sarah Palmer
SSI, youth, transition, employment, supplemental security income, interventions
Occasional Bulletin of Economic Notes 2018/01- Has the South African economy run out of fiscal space?
http://d.repec.org/n?u=RePEc:rbz:oboens:8882&r=all
Alain Kabundi
Luchelle Soobyah
2018-11-06
A Framework for Selecting Employment Interventions to Benefit Youth
http://d.repec.org/n?u=RePEc:mpr:mprres:4c4ff8375b9b4cd8aead225af450cd1e&r=all
This issue brief describes a three-step process that policymakers can use when selecting from various employment interventions and target populations among youth with disabilities.
Todd Honeycutt
Michael Levere
SSI, youth, transition, employment, supplemental security income, interventions
Shackling the Identification Police?
http://d.repec.org/n?u=RePEc:nbr:nberwo:25320&r=all
This paper examines potential tradeoffs between research methods in answering important questions versus providing more cleanly identified estimates on problems that are potentially of lesser interest. The strengths and limitations of experimental and quasi-experimental methods are discussed and it is postulated that confidence in the results obtained may sometimes be overvalued compared to the importance of the topics addressed. The consequences of this are modeled and several suggestions are provided regarding possible steps to encourage greater focus on questions of fundamental importance.
Christopher J. Ruhm
2018-11
Stock Price Rewards to Climate Saints and Sinners: Evidence from the Trump Election
http://d.repec.org/n?u=RePEc:nbr:nberwo:25310&r=all
Donald Trump's 2016 election and the subsequent nomination of Scott Pruitt, a climate skeptic, to lead the Environmental Protection Agency drastically downshifted expectations on US climate change policy. Firms' stock-price reactions to these events reveal whether their climate strategies affected their valuations. As widely reported, firms in industries with high carbon intensity benefited, at least briefly. It might be expected that companies with "responsible" strategies on climate change would also have lost value, since they were paying for actions that seemed less urgent. In fact, investors actually rewarded such firms. The analysis shows that this observed climate responsibility premium results, at least in part, from the strategic behavior of long-horizon investors who looked into the future to assess the valuation of corporations.
Stefano Ramelli
Alexander F. Wagner
Richard J. Zeckhauser
Alexandre Ziegler
2018-11
Youth Transition to Employment: Creating and Using a Community of Practice to Generate New Knowledge
http://d.repec.org/n?u=RePEc:mpr:mprres:0f45fd32d1854a1ba4a127998ae50ac5&r=all
This issue brief describes successful strategies to solicit ideas and perspectives from a Community of Practice that can be used by others interested in gathering critical input on a given idea.
Kelli Crane
Sarah Palmer
Todd Honeycutt
SSI, youth, transition, employment, supplemental security income, interventions, community of practice
Occasional Bulletin of Economic Notes 2018/02- Policy cyclicality in the post-crisis period
http://d.repec.org/n?u=RePEc:rbz:oboens:8877&r=all
Theresa Alton
2018-11-06
The Abolition of Immigration Restrictions and the Performance of Firms and Workers: Evidence from Switzerland
http://d.repec.org/n?u=RePEc:nbr:nberwo:25302&r=all
We study a reform that granted European cross-border workers free access to the Swiss labor market. Our Differences-in-Differences estimations leverage the fact that regions close to the border were affected more intensely and earlier. The greater availability of cross-border workers increased their employment but also wages and possibly employment of highly educated native workers although the new cross-border workers were also highly educated. The reason is a simultaneous increase in labor demand in skill-intensive firms: the reform increased the size, productivity, innovation performance of some incumbent firms, attracted new firms, and created opportunities for natives to pursue managerial jobs.
Andreas Beerli
Jan Ruffner
Michael Siegenthaler
Giovanni Peri
2018-11
Occasional Bulletin of Economic Notes 2018/01- Making sense of neutral real interest rates
http://d.repec.org/n?u=RePEc:rbz:oboens:8881&r=all
Chris Loewald
2018-11-06
Why is Math Cheaper than English? Understanding Cost Differences in Higher Education
http://d.repec.org/n?u=RePEc:nbr:nberwo:25314&r=all
The private return to postsecondary investment varies widely by field, but the resources required by different fields are not well known. This paper establishes five new facts about college costs using novel department-level data. First, costs vary widely across field, ranging from electrical engineering (109 percent higher costs than English) to math (22 percent lower). Costs are generally higher in fields where graduates earn more and in pre-professional programs. Second, this pattern is explained statistically by differences in class size and faculty pay, though differences in production technology enable some fields to offset higher salaries with larger classes. Third, some STEM fields experienced steep declines in expenditures over the past fifteen years while others saw increases. Fourth, increases in class size and teaching loads alongside a shift in faculty composition toward contingent faculty explain these trends. Finally, online instruction is associated with a modest reduction in cost per student, but only for undergraduate instruction. Recent policy efforts to promote enrollment in high-earning fields will thus have important implications for postsecondary costs and the social return on investment in higher education.
Steven W. Hemelt
Kevin M. Stange
Fernando Furquim
Andrew Simon
John E. Sawyer
2018-11
Mobile investment and traffic per capita tend to increase with license duration
http://d.repec.org/n?u=RePEc:zbw:itse18:184949&r=all
Using source WCIS (World Cellular Information Service) for the tangible investments of mobile operators and mobile spectrum licenses, we are able to build a database matching the level of investment per capita with average license duration for 14 countries (representing more than 75% of the number of mobile subscribers of the EEA area) during 15 years. The statistical analysis of the data base proves a strong positive correlation between license average duration and tangible investment per capita. More precisely, we observe an increase of 5.36 e in average investment per capita per year for each additional year of license duration. This feature also holds at operator level. Using Data traffic from Telecom Market Matrix at country level, we also observe that each additional year of license duration corresponds to about 10% additional yearly growth of data traffic.
Jeanjean, Francois
Lebourges, Marc
Liang, Julienne
2018
Digital Platforms in Developing Countries: "A Case-Study of Jumia Egypt"
http://d.repec.org/n?u=RePEc:zbw:itse18:184929&r=all
Digital platforms in developing countries are gaining momentum due to the increase in the apps economy that is taking place in these countries. This paper analyzes digital platforms in developing countries using a reference framework that identifies the following: definition, business models, platform enablers, and platform dynamics. The study applies this framework to Jumia Egypt and concludes with policy recommendations to promote digital platforms in developing countries.
Badran, Mona Farid
2018
Realizing the Benefits of ICT in the Climate Crisis: The Deployment Gap and Legal Impediments in Smart Agriculture and Water
http://d.repec.org/n?u=RePEc:zbw:itse18:184961&r=all
Pearl, M. Alexander
2018
How might we use Design Thinking for Digital Business Design and for creating Digital Business Value?
http://d.repec.org/n?u=RePEc:zbw:itse18:184931&r=all
Established organisations seek to reinvent or enhance their business models at a time when the rate of innovation accelerates and a transformation, such as the current digital transformation, drives the global economic environment. Design Thinking (DT) is a new methodology that has been hailed as a method to identify, understand and solve dynamic business issues. This paper investigates how the DT methodology supports an organization in finding new ways of creating, delivering, and capturing digital business value in dynamic environments. After determining the characteristics of business model creation in dynamic environments, we demonstrate how the Design Thinking methodology can guide an organisation through a digital transformative process to capture digital business value.
Baum, Peter
2018
Perceived Value of Broadcasting: Normal vs. Restoration Stages from Earthquake Disasters
http://d.repec.org/n?u=RePEc:zbw:itse18:184956&r=all
Mitomo, Hitoshi
Otsuka, Tokio
local broadcasting,disaster restoration,earthquake,CVM,contingent valuation method,PSM,price sensitivity measurement,experimental design
2018
Working with Academic Partners Effectively in the Context of Open Innovation: The Practice of Huawei
http://d.repec.org/n?u=RePEc:zbw:itse18:184940&r=all
Huawei's Huawei Innovation Research Program (HIRP) has contributed to the development of Huawei from a Chinese start-up to a global ICT leader by lavaraging its cross-border and cross-cultural network connecting world-class scholars. With the help of HIRP, Huawei has acheived a large number of breakthroughs in both fundamental research and technology applications. The HIRP has acted as a systematic and transferable model to address the challenges of Academic-Industry partnership, with three consistent and consecutive approaches, namely shared objectives; relationship multiplier and portfolio-level connections. Our focus on the relationship as a key value differentiator has reduced the mismatch between Huawei and academia.This enhanced access to high quality academic partners enables the innovation of many game-changing technologies and leads to a Better Connected World.
Furner, Adrian
Xu, Yan
2018
Compensation at the Crossroads: Autonomous Vehicles & Alternative Victim Compensation Schemes
http://d.repec.org/n?u=RePEc:zbw:itse18:184962&r=all
Pearl, Tracy Hresko
2018
How 'Big Data' affects competition law analysis in Online Platforms and Agriculture: does one size fit all?
http://d.repec.org/n?u=RePEc:zbw:itse18:184928&r=all
Atik, Can
2018
Competition policy questions in mobile network sharing
http://d.repec.org/n?u=RePEc:zbw:itse18:184960&r=all
Network sharing agreements have become increasingly widespread in mobile telecommunications markets. They carry undeniable advantages to operators and consumers alike, but also the potential for consumer harm. Not all NSAs are created equal: the assessment of the balance of harm and benefits to customers due to an NSA is a complex endeavour. In this paper, we present a framework for the competitive assessment of NSAs, detailing the possible concerns that may arise, the main factors that influence their seriousness, ways to mitigate the concerns and the principles of assessing efficiency benefits.
Pápai, Zoltán
Csorba, Gergely
Nagy, Péter
McLean, Aliz
mobile markets,network sharing,competition,competition assessment
2018
Multi-channel information dissemination for disaster evacuees – the case of the 2016 Kumamoto Earthquake in Japan
http://d.repec.org/n?u=RePEc:zbw:itse18:184937&r=all
This study examines factors that affect disaster evacuees' usage of different media in a multi-channel media environment, which means that people can receive similar content from multiple media channels. Using the 2016 Kumamoto Earthquake in Japan as the case study, we find that that multi-channel information dissemination is indeed an effective means to provide information to disaster evacuees. Specifically, it is found that traditional broadcast media and Internet media can complement each other rather than displacing. In addition, Internet media such as online TV, video streaming websites and Internet radio are effective alternatives to traditional broadcast media for providing official information to victims in severely damaged areas, which broadcast media might not be available.
Cheng, John W.
Mitomo, Hitoshi
Multi-channel information dissemination,disaster risk reduction,media consumption across platforms
2018
What do Consumers Prefer for the Attributes of Virtual Reality Head-mount Displays
http://d.repec.org/n?u=RePEc:zbw:itse18:184971&r=all
Recently, the consumer virtual reality(VR) industry has been established with the introduction of VR head-mount displays(HMDs) and many have expected VR to become the next generation platform. Despite the circumstances, the adoption of VR HMDs is slower than expected. To comprehend this matter, this study explored consumers' preference on the attributes of VR HMDs by implementing the conjoint analysis methodology and deriving the marginal willingness-to-pay(MWTP) of the attributes. Based on past literature and analysis of the product, six attributes were derived: Visualization, Accessories, Weight, Ergonomic Design, Number of Contents, and Price. The results indicate that the wearable aspect of the device is the most important. Implications for future developmental directions for VR HMDs are suggested based on the results.
Yang, Seung Ho
Nam, Changi
2018
The Challenges Urbanization in West Africa
http://d.repec.org/n?u=RePEc:wbk:wboper:30042&r=all
World Bank Group
Transport - Transport Economics Policy & Planning Urban Development - National Urban Development Policies & Strategies Urban Development - Regional Urban Development Urban Development - Transport in Urban Areas Urban Development - Urban Economic Development Urban Development - Urban Governance and Management Urban Development - Urban Housing Urban Development - Urban Poverty Urban Development - Urban Services to the Poor
2018-05
Exchange Rate Volatility and the Nigerian Balance Of Payments (1981-2016)
http://d.repec.org/n?u=RePEc:pra:mprapa:90562&r=all
The paper investigates the impact of exchange rate volatility on balance of payments in Nigeria using data from 1981 to 2016. The main objective of this study is to examine the extent to which exchange rate volatility measures have influenced the Balance of Payment (BOP) position in Nigeria during the period under study. The study utilized aggregate annual data from 1981 to 2016. The data was analysed with the co-integration/error correction model (ECM) method. The test for stationary using Augmented Dickey Fuller (ADF) showed that all the variables were not stationary in levels but were stationary in first difference. The Johansen-Juselius co-integration techniques were employed in testing for long run equilibrium relationship among the variables and the results indicated that co-integrating relationship was found among the variables. Findings from this study indicate that the systematic variation in the dependent variable (BOP) is explained by the four independent variables including nominal exchange rate, inflation rate, real interest rate and government expenditure. The result also reveals that there is long run relationship between exchange rate volatility and BOP. The paper concluded discouragement of over-reliance on imported goods and the promotion of domestic export produce is very imperative. This can only be achieved if the Nigerian economy is diversified and entrepreneurial development promoted in the country. In addition, the government should encourage export promotion strategies in order to maintain a surplus balance of trade which will help make the domestic currency strong and also prevent further depreciation of the Nigeria Naira.
Nwanekezie, Stanley
Onyiro, Harrison
Balance of Payment (BOP), ECM, Exchange rate volatility, Nigeria.
2018-12
On the Extension and Decomposition of a Preorder under Translation Invariance
http://d.repec.org/n?u=RePEc:pra:mprapa:90537&r=all
We prove the existence, for a translation-invariant preorder on a divisible commutative group, of a complete preorder extending the preorder in question and satisfying translation invariance (theorem 1). We also prove that the extension may inherit a property of continuity (theorem 2). This property of continuity may lead to scalar invariance. By seeking to clarify the relationship between continuity and scalar invariance under translation invariance, we are led to formulate a theorem that asserts the existence of a continuous linear weak representation under a certain condition (theorem 3). The application of these results in a space of infinite real sequences shows that this condition is weaker than the axiom super weak Pareto, and that the latter is itself weaker than the axiom monotonicity for non-constant preorders. Thus, theorem 3 is a strengthening of theorem 4 of Mabrouk 2011. It also makes it possible to show the existence of a sequence of continuous linear preorders whose lexicographic combination constitutes the finest combination coarser than the preorder in question (theorem 4). This decomposition makes it possible to handle continuous functions instead of preoders when one looks for optima, which may be more practical. Finally we apply this decomposition to the preorder catching-up. Several examples are provided.
Mabrouk, Mohamed
preorder extension; translation invariance; lexicographic decomposition; continuity; scalar invariance
2018-12-14
Reducing Tobacco Use Through Taxation in the Russian Federation
http://d.repec.org/n?u=RePEc:wbk:wboper:30612&r=all
World Bank Group
Public Sector Development - Public Sector Economics Health, Nutrition and Population - Disease Control & Prevention Health, Nutrition and Population - Public Health Promotion Health, Nutrition and Population - Tobacco Use and Control Macroeconomics and Economic Growth - Taxation & Subsidies
2018-10
Infinitesimal perturbation analysis for risk measures based on the Smith max-stable random field
http://d.repec.org/n?u=RePEc:arx:papers:1812.05893&r=all
When using risk or dependence measures based on a given underlying model, it is essential to be able to quantify the sensitivity or robustness of these measures with respect to the model parameters. In this paper, we consider an underlying model which is very popular in spatial extremes, the Smith max-stable random field. We study the sensitivity properties of risk or dependence measures based on the values of this field at a finite number of locations. Max-stable fields play a key role, e.g., in the modelling of natural disasters. As their multivariate density is generally not available for more than three locations, the Likelihood Ratio Method cannot be used to estimate the derivatives of the risk measures with respect to the model parameters. Thus, we focus on a pathwise method, the Infinitesimal Perturbation Analysis (IPA). We provide a convenient and tractable sufficient condition for performing IPA, which is intricate to obtain because of the very structure of max-stable fields involving pointwise maxima over an infinite number of random functions. IPA enables the consistent estimation of the considered measures' derivatives with respect to the parameters characterizing the spatial dependence. We carry out a simulation study which shows that the approach performs well in various configurations.
Erwan Koch
Christian Y. Robert
2018-12
Testing Fractional Unit Roots with Non-linear Smooth Break Approximations using Fourier functions
http://d.repec.org/n?u=RePEc:pra:mprapa:90516&r=all
In this paper we present a testing procedure for fractional orders of integration in the context of non-linear terms approximated by Fourier functions. The procedure is a natural extension of the linear method proposed in Robinson (1994) and similar to the one proposed in Cuestas and Gil-Alana (2016) based on Chebyshev polynomials in time. The test statistic has an asymptotic standard normal distribution and several Monte Carlo experiments conducted in the paper show that it performs well in finite samples. Various applications using real life time series, such as US unemployment rates, US GNP and Purchasing Power Parity (PPP) of G7 countries are presented at the end of the paper.
Gil-Alana, Luis A.
Yaya, OlaOluwa S
Fractional unit root; Chebyshev polynomial; Monte Carlo simulation; Nonlinearity; Smooth break; Fourier transform
2018-11-16
A characterization of lexicographic preferences
http://d.repec.org/n?u=RePEc:pra:mprapa:90552&r=all
This paper characterizes lexicographic preferences over alternatives that are identified by a finite number of attributes. We say two alternatives are 'totally different' if they are different with respect to every attribute. Our characterization is based on two key concepts: a weaker notion of continuity called 'mild continuity' (strict preference order between any two totally different alternatives is preserved around their small neighborhoods) and an 'unhappy set' (any alternative outside the set is preferred to all alternatives inside).
Goswami, Mridu Prabal
Mitra, Manipushpak
Sen, Debapriya
lexicographic preference; mild continuity; unhappy set; inclusion of marginally improved alternatives; preference nonreversibility
2018-12-14
Monitoring Sustainable Development. Climate and Energy Policy Indicators
http://d.repec.org/n?u=RePEc:wfo:wpaper:y:2018:i:573&r=all
Both the UN SDGs and the Paris Agreement imply ambitious long-term targets which only can be met with a fundamental restructuring of economic and social systems. We propose a set of energy and climate policy indicators that allows informed policy making and goes beyond the approaches that mainly focus on progress based on the UN indicator set. The sustainable energy indicators cover the whole energy system as well as the three dimensions of sustainability. The approach combines an energy service centred perspective with research on energy and climate indicators and embeds the indicator framework in broader socio-ecologic context. For the four demand-side sectors a set of 118 high-level energy indicators has been assembled that can be further disaggregated to about 387 indicators. For electricity and heat supply a set of 25 energy indicators has been compiled that can be further disaggregated to about 130 indicators differentiating by energy source and plant type. Interactions (i.e., synergies and conflicts) between the different target dimensions and the corresponding indicators need to be carefully considered. Given the complexity of the issue and the lack of adequate indicators and gaps in data availability it is difficult to interpret certain observable trends. This needs to be kept in mind when using the indicator system for policy analysis.
Claudia Kettner-Marx
Daniela Kletzan-Slamanig
Angela Köppl
Beate Littig
Irina Zielinska
sustainable development, indicator systems, energy policy, climate policy
2018-12-13
The Contents and Features of Dispute Settlement under US-Jordan FTA: An Appraisal
http://d.repec.org/n?u=RePEc:pra:mprapa:90524&r=all
In the area of dispute resolution, the U.S. FTAs with Arab countries share some commonalities. However, the US – JO FTA clearly differs from other U.S. FTAs with Arab countries. Areas of difference include treatment of perishable goods, appeal, panel report, and implementation of panel report. The dispute settlement mechanism in the US – JO FTA can be improved in several concrete ways.
Malkawi, Bashar H.
Arab countries, Jordan, WTO, dispute settlement
2018-09-12
Hard Hit by El Nino
http://d.repec.org/n?u=RePEc:wbk:wboper:30037&r=all
Blessings Nyanjagha Botha
Francis Samson Nkoka
Valens Mwumvaneza
Agriculture - Agricultural Irrigation and Drainage Agriculture - Agricultural Sector Economics Agriculture - Climate Change and Agriculture Agriculture - Commodity Risk Management Agriculture - Food Security Environment - Natural Disasters Environment - Water Resources Management Science and Technology Development - Climate and Meteorology
2018-05
Before It’s Too Late
http://d.repec.org/n?u=RePEc:wbk:wboper:30035&r=all
World Bank
Environment - Environmental Economics & Policies Environment - Environmental Protection Environment - Environmentally Protected Areas Environment - Forests and Forestry Environment - Tourism and Ecotourism Environment - Wildlife Resources Poverty Reduction - Poverty, Environment and Development Law and Development - Environmental & Natural Resources Law Law and Development - Law Enforcement Systems
2018-06
Advancing the Public Procurement-Governance Nexus
http://d.repec.org/n?u=RePEc:wbk:wboper:30616&r=all
Yolanda Tayler
Nora McGann
Public Sector Development - Public Sector Management and Reform Public Sector Development - Government Procurement Governance - National Governance Infrastructure Economics and Finance - Private Participation in Infrastructure
2018-10
The Factors Influence Credit Risk in Japan Banking Sector Specific for Kyoto Bank
http://d.repec.org/n?u=RePEc:pra:mprapa:90566&r=all
This research paper is to the performance of credit risk in japan bank specific for Bank of Kyoto. The measurement is based on bank specific factor and macroeconomics factor. However, the finding result would determine whether both factors is correlated significant or uninfluenced.
Mohammad Azmi, Nur Syafikah Atirah
bank specific factor, macroeconomic factor, credit risk
2018-12-16
The Russian Federation - An Exploratory Assessment of Transport Connectivity
http://d.repec.org/n?u=RePEc:wbk:wboper:30046&r=all
World Bank Group
Transport - Transport Economics Policy & Planning Transport - Roads & Highways Transport - Railroads Rural Development - Rural Roads & Transport Transport - Airports and Air Services
2017-06
Budgeting for Performance in Malaysia
http://d.repec.org/n?u=RePEc:wbk:wboper:30044&r=all
World Bank Group
Public Sector Development - Public Financial Management Public Sector Development - Public Sector Expenditure Policy Macroeconomics and Economic Growth - Fiscal & Monetary Policy
2018-03
The Rank Effect
http://d.repec.org/n?u=RePEc:arx:papers:1812.06000&r=all
We decompose returns for portfolios of bottom-ranked, lower-priced assets relative to the market into rank crossovers and changes in the relative price of those bottom-ranked assets. This decomposition is general and consistent with virtually any asset pricing model. Crossovers measure changes in rank and are smoothly increasing over time, while return fluctuations are driven by volatile relative price changes. Our results imply that in a closed, dividend-free market in which the relative price of bottom-ranked assets is approximately constant, a portfolio of those bottom-ranked assets will outperform the market portfolio over time. We show that bottom-ranked relative commodity futures prices have increased only slightly, and confirm the existence of substantial excess returns predicted by our theory. If these excess returns did not exist, then top-ranked relative prices would have had to be much higher in 2018 than those actually observed -- this would imply a radically different commodity price distribution.
Ricardo T. Fernholz
Christoffer Koch
2018-12
Pathways to Better Jobs in IDA Countries
http://d.repec.org/n?u=RePEc:wbk:wboper:30594&r=all
Dino Merotto
Michael Weber
Reyes Aterido
Agriculture - Agricultural Sector Economics Macroeconomics and Economic Growth - Economic Theory & Research Rural Development - Rural Labor Markets Social Protections and Labor - Employment and Unemployment Social Protections and Labor - Labor Markets Social Protections and Labor - Skills Development and Labor Force Training
2018-10
The Dominium Mundi Game and the Case for Artificial Intelligence in Economics and the Law
http://d.repec.org/n?u=RePEc:pra:mprapa:90560&r=all
This paper presents two conjectures that are the product of the reconciliation between modern economics and the long-standing jurisprudential tradition originated in Ancient Rome, whose influence is still pervasive in most of the world's legal systems. We show how these conjectures together with the theory that supports them can provide us with a powerful normative mean to solve the world's most challenging problems such as financial crises, poverty, wars, man-made environmental catastrophes and preventable deaths. The core of our theoretical framework is represented by a class of imperfect information game built completely on primitives (self-interest, human fallibility and human sociability) that we have called the Dominium Mundi Game (DMG) for reasons that will become obvious. Given the intrinsic difficulties that arise in solving this type of models, we advocate for the use of artificial intelligence as a potentially feasible method to determine the implications of the definitions and assumptions derived from the DMG's framework.
Rodríguez Arosemena, Nicolás
Game Theory; Artificial Intelligence; Dynamic Programming Squared; Imperfect Information Games; Law and Economics
2018-12-15
On the Evolution of Trade and of Sanitary and Phytosanitary Standards: The Role of Trade Agreements
http://d.repec.org/n?u=RePEc:pra:mprapa:90535&r=all
Trade agreements and trade measures are policy instruments aimed at favouring trade by providing a degree of harmonisation among members. We analyse how the agri-food trade and the incidence of Sanitary and Phytosanitary Standards (SPSs) have evolved for countries sharing agreements. We examine, through a regression discontinuity design, whether the approval of agreements affects the evolution of trade and SPSs and quantify the trade effects of SPSs. We also highlight the differences in trade flows due to the introduction of agreements. Findings show that trade agreements tend to increase trade and to reduce the number of policy measures among countries. Regulation inequalities exist across trade agreements covering different geo-economic areas: after the approval of agreements, the existence and the importance of SPSs become relevant among developing countries, whereas the pervasiveness of SPSs becomes less stringed between developed and developing countries. Our analyses prove that trade agreements and trade measures are trade-enhancing, with the cereals sector benefitting the most.
Santeramo, Fabio Gaetano
Guerrieri, Valentina
Lamonaca, Emilia
Agri-food trade; Non-tariff measure; Regional trade agreement; Policy.
2018-10
Precautionary Wealth and Financial Access
http://d.repec.org/n?u=RePEc:wbk:wboper:30040&r=all
Leila Aghabarari
Ahmed Rostom
Rishabh Sinha
Conflict and Development - Conflict and Fragile States Finance and Financial Sector Development - Access to Finance Finance and Financial Sector Development - Banks & Banking Reform Finance and Financial Sector Development - Finance and Development Finance and Financial Sector Development - Financial Literacy
2018-03
Which Countries are Better Prepared to Compete Globally in the Disruptive Technology Age?
http://d.repec.org/n?u=RePEc:wbk:wboper:30615&r=all
Victor Mulas
International Economics and Trade - Export Competitiveness International Economics and Trade - Trade Technology and Productivity Private Sector Development - Competitiveness and Competition Policy Private Sector Development - Private Sector Economics Science and Technology Development - Technology Innovation
2018-10
When Hours Decline: Tides of Change in Low-wage Labor Markets
http://d.repec.org/n?u=RePEc:wes:weswpa:2017-007&r=all
Using data from the Panel Study of Income Dynamics for 1997 through 2013, we explore adjustment strategies used in low-wage labor markets when hours decline, and we document the features that characterize flows of workers through these markets over time. We find that half of the population moves through these markets at some point in their lives. Yet only one percent of workers are permanently in low-wage jobs. The 17 percent who are permanently in “low-or-zero-wage” status show high rates of cycling in and out of unemployment, temporary layoff, education, disability status, temporary retirement and keeping house, thus demonstrating a labor force that is in constant motion. Yet, for over 45 percent of men and over 30 percent of women, some of that mobility is upward into higher-wage positions, suggesting that much of the movement reflects low rewards and poor work conditions. We identify 35 possible paths during the Great Recession from employment to loss of employment and back to employment by 2013, and we explore several less successful sequences ending with no job by 2013. The investigation shows that certain sequences are much more common for recent holders of low-wage jobs than for others. Workers recently in higher-wage jobs show more success in returning to employment whether coming from temporary layoff, unemployment or a stint out of the labor force, regardless of the type of non-wage activity. Men starting from low-wage jobs are more likely than others to report being unemployed in two consecutive survey years and to end up still unemployed by 2013. However, we show that recession-induced declines in hours stem largely from decreased weeks worked or lower average weekly hours rather than from a drop in the probability of working in a given year. We also find evidence of some offsetting, recession-induced increases in overtime hours for low-wage single women who head households. These findings suggest that recessionary losses are distributed in multiple ways, very few of which culminate in a worker losing all annual hours of work, even for those in low-wage jobs. However, for those starting from higher-wage positions, average job tenure rises during recessions. In contrast, the lack of security in low-wage markets shows up not only as fewer years of tenure, but also as tenure that declines by about a quarter of a year for each percentage point rise in state unemployment rates. Many of the traits that we document can be masked by cross-section snapshots. With longitudinal analysis, the picture takes new shape, showing a constant churning of the labor force and multiple strategies for adjusting to shocks. In such a world, higher-wages might help transform secondary work into jobs that promote attachment, bring lower turnover, and yield gains in productivity. This potential for improving the performance of low-wage markets suggests new ways to think about the possible consequences of minimum-wage hikes.
Wendy Rayack
2017-01
Convergence without Equity
http://d.repec.org/n?u=RePEc:wbk:wboper:30045&r=all
World Bank Group
Macroeconomics and Economic Growth - Regional Economic Development Macroeconomics and Economic Growth - Spatial and Local Economic Development Poverty Reduction - Inequality Poverty Reduction - Living Standards Private Sector Development - Business Environment
2017-06
Life on the Margins
http://d.repec.org/n?u=RePEc:wbk:wboper:30607&r=all
World Bank Group
Gender - Gender and Development Gender - Gender and Social Policy Health, Nutrition and Population - Demographics Law and Development - Human Rights Social Development - Social Conflict and Violence Social Development - Social Inclusion & Institutions
2018-09
Advancing Action on the Implementation of Tobacco Tax Harmonization in the Organization of Eastern Caribbean States Countries
http://d.repec.org/n?u=RePEc:wbk:wboper:30034&r=all
World Bank Group
Health, Nutrition and Population - Tobacco Use and Control Law and Development - Tax Law Macroeconomics and Economic Growth - Taxation & Subsidies Public Sector Development - Tax Administration
2018-06
Analyse spatiale de la localisation de la production agricole des plantes irriguées et non irriguées : Cas de la Tunisie
http://d.repec.org/n?u=RePEc:pra:mprapa:90536&r=all
This study analyzes the spatial location of agricultural production of both irrigated and non-irrigated plants in Tunisia in 2012. At the micro-spatial level, the results show that the location movements of agricultural production of irrigated and non-irrigated plants confirm the existence of a spatial dynamic between Tunisian governorates. Moreover, the findings of the global autocorrelation test provide evidence for the presence of a positive spatial autocorrelation between the considered variables.
Zouabi, Oussama
Global autocorrelation test, Local autocorrelation test, non-irrigated plants, irrigated plants, Tunisia.
2018-12-14
Consistent Inter-Model Specification for Time-Homogeneous SPX Stochastic Volatility and VIX Market Models
http://d.repec.org/n?u=RePEc:arx:papers:1812.05859&r=all
This paper shows how to recover stochastic volatility models (SVMs) from market models for the VIX futures term structure. Market models have more flexibility for fitting of curves than do SVMs, and therefore they are better-suited for pricing VIX futures and derivatives. But the VIX itself is a derivative of the S&P500 (SPX) and it is common practice to price SPX derivatives using an SVM. Hence, a consistent model for both SPX and VIX derivatives would be one where the SVM is obtained by inverting the market model. This paper's main result is a method for the recovery of a stochastic volatility function as the output of an inverse problem, with the inputs given by a VIX futures market model. Analysis will show that some conditions need to be met in order for there to not be any inter-model arbitrage or mis-priced derivatives. Given these conditions the inverse problem can be solved. Several models are analyzed and explored numerically to gain a better understanding of the theory and its limitations.
Andrew Papanicolaou
2018-12
High and Low Intraday Commodity Prices: A Fractional Integration and Cointegration Approach
http://d.repec.org/n?u=RePEc:pra:mprapa:90518&r=all
This paper examines the behaviour of high and low prices of four commodities, namely crude oil, natural gas, gold and silver, and of the corresponding ranges using both daily and intraday data at various frequencies. For this purpose, it applies fractional integration and cointegration techniques; in particular, an FCVAR model is estimated to capture both the long-run equilibrium relationships between high and low commodity prices, referred to as the range, and the long-memory properties of their linear combination. Fractional cointegration in found in all cases, with the range showing stationary and nonstationary patterns and changing substantially across the frequencies. The findings may assist investors in improving their trading strategies since high and low prices serve as entry and exit signals in the market.
Yaya, OlaOluwa S
Gil-Alana, Luis A.
Commodity prices, intraday, fractional integration, fractional cointegration, FCVAR
2018-12-05
Women's Labor Force Participation and Probability of Getting Divorced
http://d.repec.org/n?u=RePEc:pra:mprapa:90561&r=all
By using individual level panel data from 1995 to 1997, and running models with individual fixed effect and year fixed effect, the author concludes that there is no valid evidence that increase in women labor force participation can lead to rise of probability of getting divorced. Furthermore, this effect is heterogeneous among different education levels. Empirical results also find out that having high school degree has positive effect on the probability of getting divorced, while having college degree, income and number of children inthe family all have negative effect. Based on these results, measures which can increase women’s college education rate can help lower divorce rate.
Dong, Xu
Labor Force Participation, Getting Divorced, education level, income and number of children
2018-09-18
Dynamic Programming with Recursive Preferences: Optimality and Applications
http://d.repec.org/n?u=RePEc:arx:papers:1812.05748&r=all
This paper provides an alternative approach to the theory of dynamic programming, designed to accommodate the recursive preference specifications commonly used in modern economic analysis while still supporting traditional additively separable rewards. The approach exploits the theory of monotone convex operators, which turns out to be well suited to dynamic maximization. The intuition is that convexity is preserved under maximization, so convexity properties found in preferences extend naturally to the Bellman operator.
Guanlong Ren
John Stachurski
2018-12
The Albania National Employment Service Functional Review
http://d.repec.org/n?u=RePEc:wbk:wboper:30043&r=all
World Bank Group
Rural Development - Rural Labor Markets Social Protections and Labor - Employment and Unemployment Social Protections and Labor - Labor Markets Social Protections and Labor - Vocational & Technical Education
2018-05
Low Carbon Cities
http://d.repec.org/n?u=RePEc:wbk:wboper:30611&r=all
World Bank Group
Environment - Carbon Policy and Trading Environment - Climate Change Mitigation and Green House Gases Environment - Environment and Energy Efficiency Urban Development - National Urban Development Policies & Strategies Urban Development - Urban Economic Development Urban Development - Urban Environment
2018-09
Cyber-Bullying: Assessment of its Awareness and Threats to Social Media Development
http://d.repec.org/n?u=RePEc:pra:mprapa:90581&r=all
The wake of new media has turned the world into a global village. The internet in recent times, has opened doors for users to connect with people across other parts of the globe. Few can deny the huge technological advancement that are constantly taking place in the modern world. However, this advancement have brought a dramatic shift from what it means to ‘chat’ and ‘socialise’ with other people to a whole gamut of development spinning off from cyber related contingency. This study is aimed at assessing cyber-bullying in the context of undergraduate students in Nigeria, their awareness of cyber-bullying and its threat to social media development. A further aim is to establish whether the respondents have been exposed to bullying on any of the social media platforms. Drawing 396 respondents from a population of 38,000 running across four faculties randomly selected from the fourteen faculties in Nnamdi Azikiwe, University, Awka, the study found out that a majority of the respondents own internet-enabled devices, have access to social media sites through their devices and have been exposed to cyber-bullying on these sites at one point in time. The Computer Mediated Communication theory was the basis from which this study drew its framework.
Obidi, Ekpereamaka Miracle
Ahaiwe, Chizaram Priscilla
Cyber-Bullying; Threats; Social Media Development; Internet-Enabled Devices
2018-11-30
A Frequency-Domain Approach to Dynamic Macroeconomic Models
http://d.repec.org/n?u=RePEc:pra:mprapa:90487&r=all
This article is concerned with frequency-domain analysis of dynamic linear models under the hypothesis of rational expectations. We develop a unified framework for conveniently solving and estimating these models. Unlike existing strategies, our starting point is to obtain the model solution entirely in the frequency domain. This solution method is applicable to a wide class of models and permits straightforward construction of the spectral density for performing likelihood-based inference. To cope with potential model uncertainty, we also generalize the well-known spectral decomposition of the Gaussian likelihood function to a composite version implied by several competing models. Taken together, these techniques yield fresh insights into the model’s theoretical and empirical implications beyond what conventional time-domain approaches can offer. We illustrate the proposed framework using a prototypical new Keynesian model with fiscal details and two distinct monetary-fiscal policy regimes. The model is simple enough to deliver an analytical solution that makes the policy effects transparent under each regime, yet still able to shed light on the empirical interactions between U.S. monetary and fiscal policies along different frequencies.
Tan, Fei
solution method, analytic function, Bayesian inference, spectral density, monetary and fiscal policy
2018-10-20
Kenya Economic Update, October 2018
http://d.repec.org/n?u=RePEc:wbk:wboper:30597&r=all
World Bank Group
Public Sector Development - Public Sector Expenditure Policy Macroeconomics and Economic Growth - Economic Growth Macroeconomics and Economic Growth - Fiscal & Monetary Policy Poverty Reduction - Access of Poor to Social Services Poverty Reduction - Achieving Shared Growth Poverty Reduction - Inequality
2018-10
Adaptation in an Uncertain World - Detection and Attribution of Climate Change Trends and Extreme Possibilities
http://d.repec.org/n?u=RePEc:wes:weswpa:2018-008&r=all
We offer results from an artificial simulation exercise that was designed to answer three fundamental questions that lie at the heart of anticipatory adaptation. First, how can confidence in projected vulnerabilities and impacts be greater than the confidence in attributing what has heretofore been observed? Second, are there characteristics of recent historical data series that do or do not portend our achieving high confidence in attribution to climate change in support of framing adaptation decisions sometime in an uncertain future? And finally, what can analysis of confidence in attribution tell us about ranges of “not-implausible” extreme futures vis a vis projections based at least implicitly on an assumption that the climate system is static? An extension of the IPCC method of assessing our confidence in attribution to anthropogenic sources of detected warming allows us to offer an answer to the first question. We can also identify characteristics that support an affirmative answer to the second. Finally, we offer some insight into the significance of our attribution methodology in informing attempts to frame considerations of potential extremes and how to respond.
Xiyue Li
Gary Yohe
adaptation, detection, attribution, uncertain, climate change
2018-08
Albania Country Procurement and Contract Implementation Review
http://d.repec.org/n?u=RePEc:wbk:wboper:30605&r=all
World Bank
Public Sector Development - Public Financial Management Public Sector Development - Government Procurement Public Sector Development - Public Sector Administrative and Civil Service Reform
2017-05
Deep neural networks algorithms for stochastic control problems on finite horizon, Part 2: numerical applications
http://d.repec.org/n?u=RePEc:arx:papers:1812.05916&r=all
This paper presents several numerical applications of deep learning-based algorithms that have been analyzed in [11]. Numerical and comparative tests using TensorFlow illustrate the performance of our different algorithms, namely control learning by performance iteration (algorithms NNcontPI and ClassifPI), control learning by hybrid iteration (algorithms Hybrid-Now and Hybrid-LaterQ), on the 100-dimensional nonlinear PDEs examples from [6] and on quadratic Backward Stochastic Differential equations as in [5]. We also provide numerical results for an option hedging problem in finance, and energy storage problems arising in the valuation of gas storage and in microgrid management.
Achref Bachouch
C\^ome Hur\'e
Nicolas Langren\'e
Huyen Pham
2018-12
Selection mechanism design affects volatility in a market of evolving zero-intelligence agents
http://d.repec.org/n?u=RePEc:arx:papers:1812.05657&r=all
Financial asset markets are sociotechnical systems whose constituent agents are subject to evolutionary pressure as unprofitable agents exit the marketplace and more profitable agents continue to trade assets. Using a population of evolving zero-intelligence agents and a frequent batch auction price-discovery mechanism as substrate, we analyze the role played by evolutionary selection mechanisms in determining macro-observable market statistics. In particular, we show that selection mechanisms incorporating a local fitness-proportionate component are associated with high correlation between a micro, risk-aversion parameter and a commonly-used macro-volatility statistic, while a purely quantile-based selection mechanism shows significantly less correlation.
David Rushing Dewhurst
Michael Vincent Arnold
Colin Michael Van Oort
2018-12
Schumpeter vs. Keynes Redux: "Still Not Dead"
http://d.repec.org/n?u=RePEc:pra:mprapa:90543&r=all
Diamond (2009) compares the citation time series for Schumpeter and Keynes from 1956 to 2006. Citations to Schumpeter steadily increase throughout the period, whereas citations to Keynes begin to level off and then trend slightly downward beginning in the 1990s. As a result, citations to Schumpeter begin to outstrip those to Keynes. This paper replicates Diamond (2009) and extends the analysis to 2017, which incorporates citations since the onset of the Great Recession. The replication confirms the results in Diamond (2009). The analysis beyond 2006 shows citations to Schumpeter remain larger than to Keynes, but citations to Keynes undergo a resurgence. The paper argues the Great Recession helped renew interest in Keynes. Google Trends data for Schumpeter and Keynes are compared and provide evidence showing the heightened interest in Keynes during the Great Recession. For example, in the United States, the peak of Keynes's search interest occurs in February 2009, five months after Lehman Brothers declared bankruptcy.
Dalton, John
Gaeto, Lillian
Joseph Schumpeter; John Maynard Keynes; citations; Web of Science; Google Trends
2018-12-14
Looking for the stars: Estimating the natural rate of interest
http://d.repec.org/n?u=RePEc:uts:ecowps:51&r=all
Natural rate of interest or r-star and the natural rate of output growth are important policy benchmarks widely used by central banks to determine the stance of an economy. It is well recognized that r-star, linearly related to the natural rate of output growth within the New Keynesian framework, is subject to low-frequency fl uctuations. To track its evolution over time, we propose an unobserved components model with similar cycles based on the work of Holston et al. (2017). Our model takes an estimate of the time-varying natural rate of output growth as input via a first-stage model based on a first-difference version of Okun's law with time-varying parameters. In the second-stage, the full model is estimated using Kalman filter. We also show that the similar cycles imply a Taylor rule and a hybrid New Keynesian Phillips curve. For US, EA and UK, our estimates suggest that the decline of natural rate of output growth started from the 1960s, while r-star for US and EA started to fall from 1985. R-star of UK started low during 1960s, but rose and stayed relatively high in the 80s until a big drop took place during the GFC.
Mengheng Li
Irma Hindrayanto
Natural rate of interest; Potential growth rate; Trend growth; Secular stagnation; Phillips curve; Monetary policy rules; Unobserved components models; Similar cycles; Kalman filter
2018-10-30
Analysis of Russia's Investment Agreements and Proposals for Their Modification Based on OECD Standards
http://d.repec.org/n?u=RePEc:rnp:wpaper:041828&r=all
The article presents an analysis of Russia's existing agreements on the protection of investments, as well as proposals for amending Russian Federation Government Decree No. 992 of 30 September 2016 "On the Conclusion of International Treaties of the Russian Federation on the Promotion and Protection of Investments".
Levashenko, Antonina (Левашенко, Антонина)
Ermokhin, Ivan (Ермохин, Иван)
OECD, investments, responsible business conduct, transparency, investment agreement, bilateral investment protection agreements
2018-04
Welfare consequences of rising wage risk in the United States: Self-selection into risky jobs and family labor supply adjustments
http://d.repec.org/n?u=RePEc:vuw:vuwecf:7967&r=all
We investigate the welfare consequences of the increase in wage volatility in the United States from the early 1970s to the 2000s. Several important questions are jointly addressed to fully assess the welfare cost of the increase in the variance of wage shocks: whether the increased wage shocks resulted from heterogeneous workers’ risk choices, whether they were anticipated, and whether the affected individuals were insured against the changes. We provide a quantitative assessment of the welfare cost using a general equilibrium model with incomplete markets. Heterogeneous risk preferences, job heterogeneity in wage risk, and gender differences in wage dynamics constitute unique features of the model. The results show that the welfare cost is significantly overstated by neglecting heterogeneity in individual risk preferences and workers’ risk choices. The welfare cost remains substantial at 3.80 percent (in life-time consumption equivalent) even when increases in wage shocks are anticipated, heterogeneous workers self-select into risky jobs, and various insurance mechanisms are allowed in the model. Family labor supply adjustments reduce the welfare cost more effectively when borrowing and saving behavior is allowed. It is also found that wives increase their labor supply significantly in response to anticipated increases in the variance of husbands’ permanent wage shocks, and this ‘added-worker’ effect is mostly accounted for by wives’ labor supply adjustments on the extensive margin.
Park, Seonyoung
Shin, Donggyun
Heterogeneity, Insurance, Wage shock, Welfare costs, Labor supply,
2018
The concept of tax gaps - Corporate Income Tax Gap Estimation Methodologies
http://d.repec.org/n?u=RePEc:tax:taxpap:0073&r=all
The corporate income tax gap (CIT Gap) is the gap between corporate tax revenues as they “should be” collected and as they “are” collected. The gap is an indication of potential CIT revenue losses. This report defines the CIT gap as encompassing both non-deliberate actions by taxpayers (such as errors or omissions) and deliberate actions (such as fraud, evasion and avoidance) that lead to shortfall in revenues. This report reflects the objective of the Tax Gap Project Group (TGPG) to map and share expertise and good practices. The two main approaches to estimating the tax gap – the top-down and bottom-up methods – have both advantages and disadvantages. The choice of the estimation method depends heavily on the availability of data, resources and purposes of the estimate.
FISCALIS Tax Gap Project Group
corporate taxation, tax gap, european union, tax avoidance
2018-11
Not so disruptive after all: How workplace digitalization affects political preferences
http://d.repec.org/n?u=RePEc:upf:upfgen:1623&r=all
New digital technologies are transforming workplaces, with unequal economic consequences depending on workers’ skills. Does digitalization also cause divergence in political preferences? Using an innovative empirical approach combining individuallevel panel data from the United Kingdom with a time-varying industry-level measure of digitalization, we first show that digitalization was economically beneficial for a majority of the labor force between 1997-2015. High-skilled workers did particularly well, they are the winners of digitalization. We then demonstrate that economic trajectories are mirrored in political preferences: Among high-skilled workers, exposure to digitalization increased voter turnout, support for the Conservatives, and support for the incumbent. An instrumental variable analysis, placebo tests and multiple robustness checks support our causal interpretation. The findings complement the dominant narrative of the "revenge of the left-behind": While digitalization undoubtedly produces losers, there is a large and often neglected group of winners who react to technological change by supporting the status quo.
Aina Gallego
Thomas Kurer
Nikolas Schöll
Political economy, digitalization, labor markets, voters
2018-11
Behavioral Aspects of the Regulator's Actions
http://d.repec.org/n?u=RePEc:rnp:wpaper:051714&r=all
The findings of many studies in behavioral economics led to a wide dissemination of an opinion that the problem of the effects of limited rationality in the markets can be solved through the proper development of menu of options available to the consumer. The development of such a menu is the obligation of regulators. However, the question arises: to what extent regulators, in turn, are limitedly rational, and are motivated to create optimal methods that ensure the maximum level of welfare, given that their development is costly. This paper systematizes the main forms of limited rationality that can influence the adoption of Decisions by regulators. Based on the analysis, an attempt has been made to answer the two Questions: 1) is there a need and an opportunity to take into account the limited rationality of civil servants in modeling the actions of the regulator and 2) whether development of Special practical measuresis is required for leveling the revealed effects.
Pavlova, Natalia (Павлова, Наталья)
Shastitko, Anastasia (Шаститко, Анастасия)
Behavioral economics, cognitive errors, state regulation, incentives of civil servants
2017-05
ASEAN rice market integration: findings from a feasibility study
http://d.repec.org/n?u=RePEc:oec:agraaa:117-en&r=all
This study explores feasibility of regional rice market integration by examining the impacts on production and trade, with a specific focus on the adjustment impacts for rice producers. It seeks to set out policy measures required to better integrate the rice markets of Association of Southeast Nations (ASEAN) countries and the role that trade policy can play to help the agricultural sector adjust to pressures created from freer trade in rice within this region. While regional rice market integration can deliver more rice at lower prices to the regions consumers, this study finds significant adjustments to the rice sectors will be required in Indonesia, Malaysia, and the Philippines. However, opportunities through lowering tariff barriers with existing key trading partners of free trade agreements has the scope to create more employment and value adding opportunities in all agricultural sectors to offset the losses from regional rice market integration. The study suggests a number of measures are necessary to build trust in regional markets to allow rice market integration to take place. This includes an agreement to ban export restrictions. Furthermore, while broader trade reforms will help create new opportunities for agricultural sectors across the ASEAN region, flanking policies and investments in the enabling environment are still required for the sectors to take full advantage of these opportunities.
Jared Greenville
agricultural trade, Agriculture, regional integration
2018-12-17
Bounded learning by doing, inequality, and multi-sector growth: A middle-class perspective
http://d.repec.org/n?u=RePEc:rie:riecdt:4&r=all
This study presents a multisector model of middle-class-led economic growth, whereby, on the one hand, the middle class plays a key role in determining technical progress, while, on the other hand, both its size and income share are the result of past economic growth. Learn- ing by doing, which is assumed to be sector-speci c, bounded from above, and constrained by a minimum scale restriction, is the primary source of productivity gains. The emphasis is then placed on the entire income distribution, which a¤ects the composition of demand -span of goods consumed- and in turn, the speed and the extent of the learning process in the set of goods produced. The model exhibits an inverted-U relationship between inequality and economic growth, which re ects the following trade-o¤: An economy cannot learn both quickly and simultaneously in a wide range of sectors. It is constrained in this respect by its income/skill distribution and the size of its labor force, with consequences on growth-enhancing strategies by means of income redistributions.
Alain Desdoigts
Fernando Jaramillo
Learning by doing, Middle-class-led consumption, Inequality, Multi-sector growth, Income redistribution
2018-07
Climate Change: The Ultimate Challenge for Economics
http://d.repec.org/n?u=RePEc:ris:nobelp:2018_003&r=all
William D. Nordhaus delivered his Prize Lecture on 8 December 2018 at the Aula Magna, Stockholm University.
Nordhaus, William D.
long-term growth; climate change
2018-12-08
Agro-food trade, GVCs and agricultural development in ASEAN
http://d.repec.org/n?u=RePEc:oec:agraaa:116-en&r=all
The countries that compromise the Association of Southeast Asian Nations (ASEAN) have expanded their involvement in global agro-food trade through strong regional production growth and increasing consumer demands from population growth and higher incomes. Regional and international agro-food markets have thus become an important source of income and food for the regions producers and consumers. However, growth in trade has lessened in recent years with projections suggesting a further slowing over the medium term. This study explores the role that agro-food trade and participation in agro-food global value chains (GVC) has had on regional agro-food sectors and current barriers that are holding the region back from unlocking the full benefits of further integration into regional and global agro-food markets. It finds that although GVC engagement has increased regional agro-food growth between 2004 and 2014, gaps remain in the level of regional integration. Results from the analysis suggest that reducing the remaining tariff and non tariff barriers, and creating an enabling environment to allow agricultural producers to better access service inputs, will help spur sector growth and agricultural incomes.
Jared Greenville
Kentaro Kawasaki
agricultural trade, Agriculture, ASEAN, regional integration
2018-12-17
An Auction-Based Test of Private Information in an Interdealer FX Market
http://d.repec.org/n?u=RePEc:rie:riecdt:1&r=all
There are several financial markets where a few dealers trade a large share of total volume, while also having access to periodic auctions of the same asset conducted by a third party. For such a market, we derive a test of private information about the value of the asset that combines data on both bidding behavior and market trades. Our approach is to test for private versus common values, as defined in auction theory. We use changes in trading prices of extreme bidders before and after the auction to test the null hypothesis of private values (no private information) against the alternative of common values (private information). Additionally, we use a regression discontinuity design where we compare the behavior of dealers bidding right below and right above the auction's cutoff price to control for inventory effects. Our case study are foreign exchange auctions conducted by the Central Bank of Colombia during the period 2008-2014, and the corresponding interdealer market for Colombian Pesos against US dollars. Overall, our test rejects the null hypothesis. Specifically, information revealed to the bidders about their relative valuations has a subsequent effect on trading prices, at an hourly trading window, equivalent to 23% - 39% of the standard deviation of currency prices. **** RESUMEN: Existen varios mercados financieros en los que algunos intermediarios tranzan una gran parte del volumen total, además de tener acceso a subastas periódicas del mismo activo realizadas por un tercero. Para dicho mercado, derivamos una prueba de información privada sobre el valor del activo que combina datos sobre el comportamiento de las pujas y las transacciones de mercado. Nuestro enfoque es probar valores privados versus valores comunes, tal como se define en la teoría de subastas. Utilizamos cambios en los precios de mercado de los postores extremos antes y después de la subasta para probar la hipótesis nula de valores privados (sin información privada) frente a la alternativa de valores comunes (información privada). Además, utilizamos un diseño de regresión discontinua en el que comparamos el comportamiento de los postores que ofertan justo debajo y encima del precio de corte de la subasta para controlar por posibles efectos de inventario. Nuestro caso de estudio son las subastas de divisas realizadas por el Banco de la República de Colombia durante el periodo 2008-2014, y el mercado cambiario correspondiente de pesos-dólar. En general, nuestra prueba rechaza la hipótesis nula. En particular, la información revelada a los postores sobre sus valoraciones relativas tiene un efecto sobre los precios de mercado, en una ventana de una hora, equivalente al 23% - 39% de la desviación estándar de los precios de las divisas.
Pietro Bonaldi
Mauricio Villamizar-Villegas
Auctions, Common Values, Private Values, Private Information, Foreign Exchange Market, Regression Discontinuity Design, Subastas, Valores Comunes, Valores Privados, Información Privada, Mercado Cambiario, Regresión Discontinua.
2018-08
Bias of OLS Estimators due to Exclusion of Relevant Variables and Inclusion of Irrelevant Variables
http://d.repec.org/n?u=RePEc:ums:papers:2018-19&r=all
In this paper I discuss three issues related to bias of OLS estimators in a general multivariate setting. First, I discuss the bias that arises from omitting relevant variables. I offer a geometric interpretation of such bias and derive su
Deepankar Basu
omitted variable; irrelevant variables; ordinary least squares; bias
2018
The impact of corruption on economic growth, a bootstrapping analysis
http://d.repec.org/n?u=RePEc:por:fepwps:612&r=all
In this paper we evaluate the impact of corruption in economic growth and if in less developed countries the hypothesis "greasing the wheels” is valid. Using an unbalanced panel data with 2907 observations from 174 countries and 23 years between 1995 and 2017 (data from Transparency International and World Bank), we estimate using bootstrapping that the impact of corruption on growth is negative (an estimate of 0.025pp per CPI point) and that the hypothesis "greasing the wheels” is not supported in the data. Our results are in accordance with the literature but are more robust because our database has much more observations.
Pedro Cosme da Costa Vieira
Corruption, Economic Growth, Panel data, Bootstrapping
2018-12
Biographical
http://d.repec.org/n?u=RePEc:ris:nobelp:2016_008&r=all
I was born in Helsinki in 1949. My sister Marianne was born in 1946. Our parents were married when the war against the Soviet Union ended in 1944. My father had spent five years on the front like so many young Finnish men. The post-war years were challenging socially and economically. The government had to arrange homes for over 400,000 refugees from regions lost in the war. In addition, Finland had to pay onerous reparation fees. Despite these hardships, I remember my early childhood as a happy time. There were plenty of children around to play with. We entertained ourselves with games of all sorts. There were few toys but our imagination more than filled the void. It taught me that material wealth is not essential for happiness.
Holmström , Bengt
contract theory;
2017
distcomp: Comparing distributions
http://d.repec.org/n?u=RePEc:umc:wpaper:1817&r=all
The distcomp command is introduced and illustrated. The command assesses whether or not two distributions differ at each possible value while controlling the probability of any false positive, even in finite samples. Syntax and the underlying methodology (from Goldman and Kaplan 2018) are discussed. Multiple examples illustrate the distcomp command, including revisiting the experimental data of Gneezy and List (2006) and the regression discontinuity design of Cattaneo, Frandsen, and Titiunik (2015).
David M. Kaplan
Stata
2018
Apropiaci\'on privada de renta de recursos naturales? El caso del cobre en Chile
http://d.repec.org/n?u=RePEc:arx:papers:1812.05093&r=all
Unexpected increases of natural resource prices can generate rents, value that should be recovered by the State to minimize inefficiencies, avoid arbitrary discrimination between citizens and keep a sustainable trajectory. As a case study about private appropriation of natural resource rent, this work explores the case of copper in Chile since 1990, empirically analyzing if the 12 main private mining companies have recovered in present value more than their investment during their life cycle. The results of this exercise, applicable to other natural resources, indicate that some actually have, capturing about US$ 40 billion up to 2012. Elaborating an adequate institutional framework for future deposits remain important challenges for Chile to plentifully take advantage of its mining potential, as well as for any country with an abundant resource base to better enjoy its natural wealth. For that purpose, a concession known as Least Present Value Revenue (LPVR) is proposed.
Benjam\'in Leiva
2018-12
The long run dynamics of economic growth with environmental catastrophe
http://d.repec.org/n?u=RePEc:ums:papers:2018-20&r=all
The purpose of this paper is to consider the dynamics of growth in a two state variable and two control variable model where the environment is taken as a constraint. This captures some elements of environmental problems not covered in the cost approach. It also captures the idea that the environment may be an absolute barrier or have a catastrophe boundary. It show that, even though the environment is not a cost, it may be optimal to cut growth before the barrier is reached. It also shows that the technology of production has a strong non-linear affect on maximum attainable output.
Alex Coram
2018
On the Possibility of Progress
http://d.repec.org/n?u=RePEc:ris:nobelp:2018_004&r=all
Paul M. Romer delivered his Prize Lecture on 8 December 2018 at the Aula Magna, Stockholm University.
Romer, Paul M.
long-term growth;
2018-12-08
Biographical
http://d.repec.org/n?u=RePEc:ris:nobelp:2016_007&r=all
I was born in London in 1948. My parents were both doctors. My mother was a gynecologist at a time when women doctors in the U.K. were relatively uncommon; she was a German-born Jew, who had left Germany in 1933 just after Hitler came to power. My father was an epidemiologist of some distinction whose particular interest was TB. He also was one of the key players in the 1948 Streptomycin trial, which put randomized control trials on the map. He came from a long-standing Anglo-Jewish family. We lived in comfortable but by no means luxurious middle class circumstances in the Hampstead area. I was an only child. My parents had had a son about a year before who died a few hours after being born, and so my arrival was particularly welcome. Perhaps because of this my parents were quite protective of me. Since my mother worked, a caregiver, called Mrs. Shealey, helped out during my childhood. My father was 48 when I was born – very old for a father at the time – but he lived to 106. My mother died at 93. I had a close and loving relationship with both of them.
Hart, Oliver
Contract theory;
2017
Beyond Okun's Law: Output Growth and Labor Market Flows
http://d.repec.org/n?u=RePEc:tin:wpaper:20180097&r=all
This paper studies the relationship between the change in the unemployment rate and output growth using an approach based on labor market flows. The framework shows why the Okun coefficient may be constant/time-varying and/or symmetric/asymmetric and that the outcome lies with the behavior of the labor flows in response to growth. The encompassing framework nests the conditions to determine the properties of the Okun coefficient without the need to rely on retrospective arbitrary dating of recessions. The framework also highlights the potential misspecification in conventional models of Okun's Law unless stringent conditions are assumed about the behavior of labor flows. The empirical analysis is based on the stock-consistent labor market flows data developed by the BLS for the period 1990:2-2017:3.
Guay C. Lim
Robert Dixon
Jan (J.C.) van Ours
Labor flows; Time-varying Okun; Asymmetry
2018-12-06
Calibrating rough volatility models: a convolutional neural network approach
http://d.repec.org/n?u=RePEc:arx:papers:1812.05315&r=all
In this paper we use convolutional neural networks to find the H\"older exponent of simulated sample paths of the rBergomi model, a recently proposed stock price model used in mathematical finance. We contextualise this as a calibration problem, thereby providing a very practical and useful application.
Henry Stone
2018-12
Collateral booms and information depletion
http://d.repec.org/n?u=RePEc:upf:upfgen:1622&r=all
We develop a new theory of information production during credit booms. In our model, entrepreneurs need credit to undertake investment projects, some of which enable them to divert resources towards private consumption. Lenders can protect themselves from such diversion in two ways: collateralization and costly screening, which generates durable information about projects. In equilibrium, the collateralization-screening mix depends on the value of aggregate collateral. High collateral values raise investment and economic activity, but they also raise collateralization at the expense of screening. This has important dynamic implications. During credit booms driven by high collateral values (e.g. real estate booms), the economy accumulates physical capital but depletes information about investment projects. As a result, collateral-driven booms end in deep crises and slow recoveries: when booms end, investment is constrained both by the lack of collateral and by the lack of information on existing investment projects, which takes time to rebuild. We provide new empirical evidence using US rm-level data in support of the model's main mechanism.
Vladimir Asriyan
Luc Laeven
Alberto Martin
Credit booms, collateral, information production, crises, misallocation.
2018-11
Multidimensional poverty of people with the title of "veteran of labor", and families with children
http://d.repec.org/n?u=RePEc:rnp:wpaper:051807&r=all
Grishina, Elena (Гришина, Елена)
Denisova, I (Денисова, И.)
Kuznetsova, Polina (Кузнецова, Полина)
Lebedev, Daniil (Лебедев, Даниил)
2018-05
Does the Deregulation of the Labour Market Reduce Employment Hysteresis? An Analysis in a Low Interest Rate Environment
http://d.repec.org/n?u=RePEc:por:fepwps:611&r=all
This paper analysis the effects of deregulation of the employment in an environment of low interest rates and economic uncertainty. For this purpose, we estimate a switching employment equation based on the play model of hysteresis. As a novel feature, the estimation allows for a possible change in the value of the switching parameter after the application of labour market reforms. We use Portuguese monthly data spanning from January 2000 to October 2016. Portugal provides a good case study since it is a country where significant measures towards the deregulation of the labour market were applied after the recent financial crises. The results show that these measures reduced the hysteresis effects in the dynamics of aggregate employment except in the period where uncertainty increased substantially.
Paulo R. Mota
Paulo B. Vasconcelos
employment, hysteresis, uncertainty, employment protection legislation
2018-12
Beyond the principle of sovereign unity: identity and representation as the resources of authoritarian power
http://d.repec.org/n?u=RePEc:rnp:wpaper:061815&r=all
Unity and indivisibility proclaimed by Jean Bodin is the fundamental principle of sovereignty. As it is shown in this text, this principle can be productively problematized. At the heart of this problematization is the conflict between the two "rock" political forms, singled out by Karl Schmitt - representation and identity/immanence, taken as an unavoidable condition for the possibility of the exercising of state power. Conflict, in this case, is understood not as divarication, not as the situation of choice in favour of one or another basis of sovereignty. It is about the possibilities of using the unavoidability of this very conflict itself for the construction of unique "bad governments", the so-called authoritarian regimes. In the introduction, we've drawn the distinction between ontological and symbolic sovereignty, symmetric with Schmitt's distinction between identity and representation. In the first chapter, the problem of transforming a sovereign into a "figure of silence" in European political philosophy is elaborated. In the second chapter, we analyze two strategies of "gaining" sovereignty: Kant's and de Sade's. In the third, we propose a sketch of a reconceptualization of the dictatorship, based on the dictator's ability to use resources of identity as a political form.
Vakhshtayn, Victor (Вахштайн, Виктор)
2018-06
An Axiomatic Foundation of the Ecological Footprint
http://d.repec.org/n?u=RePEc:tch:wpaper:cep025&r=all
The objective of this paper is to provide an axiomatic foundation to the ecological footprint developed and refined by the authors in the Global Footprint Network, among others. For this purpose, five axioms are proposed which represent general properties any ecological footprint measure should fulfill. We show that an index exists which is unique up to a coefficient to be chosen arbitrarily. As an implication, footprints have to be measured on a ratio scale. This result supports the conventional unit of measurement (land area) which itself is represented by a ratio scale. In this respect, our index differs from the compound-based ecological footprint index in which the norm is missing and, therefore, it is implicitly set equal to one. Apart from that we find, as the most important result, that the ad-hoc design of the commonly applied ecological footprint index has been given an axiomatic foundation.
Thomas Kuhn
Radomir Pestow
Anja Zenker
Ecological Footprint Index, Axiomatic Foundation, Measurement Theory, Overshoot Day, Sustainable Welfare
2018-10
Green Growth and Trade in Environmental Goods and Services: A South Asian Perspective
http://d.repec.org/n?u=RePEc:saw:wpaper:wp/18/01&r=all
This paper looks at the patterns, trends, and existing barriers in the trade of environmental goods and services (EGS) in South Asia. It also looks at the state of green growth in the region, with particular emphasis on carbon dioxide emission and energy supply and consumption pattern, to deduce whether the trade of EGS has been happening at a level conducive to promoting green growth. Although the trade of environmental goods has been exhibiting an increasing trend, the increase is almost exclusively the result of increasing imports. The lackluster export performance of environmental goods by South Asian countries, except for India, is indicative of a dismal state of environment industry in South Asia region. The most visible benefits of outcome of the liberalization of environmental goods would thus be increased imports. However, we did not find strong relation between import of environmental goods and level of green growth. The proximate reasons for such relation are the environmentally hazardous energy mix - coal and oil still dominate the primary energy supply, energy consumption, and electricity generation, implying unsustainable modes of consumption and production - and hence the perpetually increasing greenhouse gas emissions for all the South Asian countries. A strong commitment to green economy through legislations, policy, governing bodies as well as behavioral changes are needed to dissociate economic growth from environmental impacts. Analysis of tariffs on environmental goods in South Asia suggests some tariff barriers are present alongside non-tariff barriers. There is a lack of data to analyze the trade of environmental services in South Asia but evidence suggests that significant barriers for liberalization of environmental services are firmly in place.
Kshitiz Dahal
Posh Raj Pandey
Green Growth, Environmental Goods, Environmental Services, OECD List, APEC List, Friends List, Greenhouse Gases, List Approach, Project Approach, Integrated Approach, Request and Offer methodology, Hybrid Approach, Carbon dioxide emission, Total Primary Energy Supply Mix (TPES), Total Energy Consumption Mix, Electricity Generation Mix
2018-05
The Gilded Bubble Buffer
http://d.repec.org/n?u=RePEc:rie:riecdt:3&r=all
We provide a microfounded framework for the welfare analysis of macroprudential policy by means of an overlapping generation model where productivity and credit supply are subject to random shocks in order to analyze rational bubbles that can be fueled by banking credit. We find that credit financed bubbles may be welfare improving because of their role as a buffer in channeling excessive credit supply and inefficient investment at the firms' level, but can cause systemic risk. Therefore macroprudential policy plays a key role in improving efficiency while preserving financial stability. Our approach allows us to compare the efficiency of alternative macroprudential policies. Contrarily to conventional wisdom, we show that macroprudential policy may be efficient even in the absence of systemic risk, that it has to be contingent on productivity shocks, to take into account real interest rates.
Xavier Freixas
David Perez-Reyna
Bank, bubble, macroprudential regulation
2018-10
EMPLOYMENT HYSTERESIS: AN ARGUMENT FOR AVOIDING FRONT-LOADED FISCAL CONSOLIDATIONS IN THE EUROZONE
http://d.repec.org/n?u=RePEc:por:fepwps:610&r=all
The austerity policy applied by the Eurozone peripheral governments under the International Monetary Fund (IMF)/ European Central Bank (ECB)/ European Commission financial assistance programs has contributed to a sharp reduction of aggregate demand, regardless of the unconventional measures undertaken by the ECB. The ECB decreased the interest rate on the main refinancing operations to zero, and is buying assets from banks on a massive scale under the Expanded Asset Purchase Programme. The fact that these extraordinary measures have not been enough to produce a strong recovery, shifts the focus again to fiscal policy. Central to assessing the effects of fiscal policy are the value of impact fiscal multipliers and the size of hysteretic effects. There is widespread evidence that public expenditure multipliers are greater than one when the economy is depressed and the interest rates are close to zero. However, less is known about the importance of hysteresis effects. Using the linear play model of hysteresis we find that hysteresis effects are important in the Eurozone peripheral countries. Large fiscal impact multipliers combined with the presence of hysteresis implies that front-loaded austerity depresses the economy in the short run and these effects may persist in the long run.
Paulo R. Mota
Abel L. C. Fernandes
Paulo B. Vasconcelos
Employment, fiscal multipliers, hysteresis
2018-12
Expectations-Based Loss Aversion in Common-Value Auctions: Extensive vs. Intensive Risk
http://d.repec.org/n?u=RePEc:uts:ecowps:50&r=all
We analyze the behavior of expectations-based loss-averse bidders in frist-price and second-price common-value auctions. Highlighting the distinction between the uncertainty bidders face over whether they win the auction (extensive risk) and that over the value of the prize conditional on winning (intensive risk), we show that loss-averse bidders react differently to these different kinds of risk. In particular, the intensive risk pushes bidders to behave less aggressively in a common-value environment compared to one with private values. Yet, despite this "precautionary biddinging" effect, in equilibrium bidders can be exposed to the "winner's curse". We consider two alternative specifcations for how bidders assess outcomes as either gains or losses. Under narrow bracketing, bidders experience gains and losses separately over whether they receive the prize and how much they pay. Under broad bracketing, instead, bidders assess gains and losses over their net surplus. With narrow bracketing, first-price auctions expose bidders to less intensive risk and yield a higher expected revenue than second-price auctions, while the opposite result might hold with broad bracketing.
Benjamin Balzer
Antonio Rosato
Reference-Dependent Preferences; Loss Aversion; Common-Value Auctions; Winner?s Curse
2018-10-18
What Option Prices tell us about the ECB's Unconventional Monetary Policies
http://d.repec.org/n?u=RePEc:tin:wpaper:20180096&r=all
We use a series of different approaches to extract information about crash risk from option prices for the Euro-Dollar exchange rate, with each step sharpening the focus on extracting more specific measures of crash risk around dates of ECB measures of Unconventional Monetary Policy. Several messages emerge from the analysis. Announcing policies in general terms without precisely describing what exactly they entail does not move asset markets or actually increases crash risk. Also, policies directly focused on changing relative asset supplies do seem to have an impact, while measures aiming at easing financing costs of commercial banks do not.
Stan Olijslagers
Annelie Petersen
Nander de Vette
Sweder (S.J.G.) van Wijnbergen
Quantitative Easing; Unconventional Monetary Policies; Exchange Rate Crash Risk; risk reversals; mixed diffusion jump risk models
2018-12-06
From Tatopani to Rasuwa: An analysis of Nepal-China trade after the earthquake
http://d.repec.org/n?u=RePEc:saw:wpaper:wp/18/02&r=all
This paper analyses changes in Nepal"\u0027"s trade with China in the wake of the 2015 earthquake, which was followed by a blockade of the Nepal-India border. Using monthly trade data to obtain trade flows over subperiods of less than a year, it first shows how the blockade compounded the earthquake"\u0027"s blow to trade. It, then, dissects Nepal-China trade performance and patterns at the product level, customs point/route level and product-customs point/route level. With Tatopani-Zhangmu, the main commercial trading point on the Nepal-China border, shut after the earthquake and Rasuwagadhi-Kerung, a recently opened trading point with a barely motorable road, unable to fully absorb the diverted trade traffic, portions of Nepal"\u0027"s overland imports from China were forced to take a costly detour via sea. The share of overland imports from China fell from 24 per cent before the earthquake to 12 per cent two years after the quake. There was a general shift towards using both sea and air routes rather than just a single route for imports. The time cost imposed by the enforced sea detour for imports is equivalent to a tariff of 18 per cent to 62 per cent. The share of overland exports to China fell from 69 per cent to 43 per cent. While changes in routes were stark for imports, they were modest for exports that initially used Tatopani. The limited route changes for exports occurred overwhelmingly towards the air route rather than the sea route. The relative importanceof exports to China via air has increased, but total exports to China, as of the end of Fiscal Year 2016/17, were yet to be restored to pre-earthquake levels. The paper discusses likely issues in the future of NepalChina trade through the lens of transport and transit, including the emergence of the Rasuwagadhi-Kerung option. As a landlocked country, Nepal"\u0027"s strategy should be to diversify trade and transit routes, exploring all options. The temptation to make a cost-benefit analysis comparing trade costs along different routes, without factoring in the value of transit needs, must be avoided.
Paras Kharel
Nepal-China trade, Nepal-India relations, Nepal earthquake, Nepal-India border blockade, trade costs, transit, Tatopani-Zhangmu, Rasuwagadhi-Kerung, Nepal-China railway
2018-06
Equal long-term care for equal needs with universal and comprehensive coverage? An assessment using Dutch administrative data
http://d.repec.org/n?u=RePEc:tin:wpaper:20180098&r=all
The Netherlands is one of the few countries that offer generous universal coverage of long-term care (LTC). Does this ensure that the Dutch elderly with similar care needs receive similar LTC, irrespective of their income? In contrast with previous studies of inequity in care use that relied on a statistically derived variable of needs, our paper exploits a readily available, administrative measure of LTC needs, stemming from the eligibility assessment organized by the Dutch LTC assessment agency. Using exhaustive administrative register data on 616,934 individuals aged 60 and older eligible for public LTC, we find a substantial pro-poor concentration of LTC use that is only partially explained by poorer individuals’ greater needs. Among those eligible for institutional care, higher-income individuals are more likely to use – less costly – home care. This pattern may be explained by differences in preferences, but also by their higher copayments for nursing homes and by greater feasibility of home-based LTC arrangements for richer elderly. At face value, our findings suggest that the Dutch LTC insurance ‘overshoots’ its target to ensure that LTC is accessible to poorer elderly. Yet, the implications depend on the origins of the difference and one’s normative stance.
Marianne Tenand
Pieter Bakx
Eddy (E.K.A.) van Doorslaer
Long-term care; Equity in care use; Horizontal equity; Socio-economic inequality
2018-12-13
The Geography of Repression and Support for Democracy: Evidence from the Pinochet Dictatorship
http://d.repec.org/n?u=RePEc:rie:riecdt:5&r=all
We show that exposure to repression under dictatorship increases support for democracy and contributes to regime change when a democratic window of opportunity arises. Studying the military dictatorship of Augusto Pinochet in Chile, we exploit the fact that the predetermined location of military bases predicts local levels of civilian victimization, but is unrelated to historical political preferences. Using two-stage least squares, we show that increased exposure to repression during the dictatorship led to higher voter registration and higher opposition to Pinochet’s continuation in power in the 1988 plebiscite that triggered the democratic transition. Complementary survey data confirms that individuals with greater exposure to repression during the military regime continue to have stronger preferences for democracy. However, exposure to repression does not affect election outcomes after democratization.
María Angelica Bautista
Felipe González
Luis R. Martínez
Pablo Muñoz
Mounu Prem
Chile; Human rights; Repression; Dictatorship; Democratization; Elections; Derechos humanos; Represión; Dictadura; Democratización; Elecciones
2018-12
Weak comonotonicity
http://d.repec.org/n?u=RePEc:arx:papers:1812.04827&r=all
The classical notion of comonotonicity has played a pivotal role when solving diverse problems in economics, finance, and insurance. In various practical problems, however, this notion of extreme positive dependence structure is overly restrictive and sometimes unrealistic. In the present paper, we put forward a notion of weak comonotonicity, which contains the classical notion of comonotonicity as a special case, and gives rise to necessary and sufficient conditions for a number of optimization problems, such as those arising in portfolio diversification, risk aggregation, and premium calculation.
Ricardas Zitikis
Ruodu Wang
2018-12
Are professors worth it? The value-added and costs of tutorial instructors
http://d.repec.org/n?u=RePEc:vuw:vuwecf:7955&r=all
A substantial share of university instruction happens in tutorial sessions— small group instruction given parallel to lectures. In this paper, we study whether instructors with a higher academic rank teach tutorials more effectively in a setting where students are randomly assigned to tutorial groups. We find this to be largely not the case. Academic rank is unrelated to students’ current and future performance and only weakly positively related to students’ course evaluations. Building on these results, we discuss different staffing scenarios that show that universities can substantially reduce costs by increasingly relying on lower-ranked instructors for tutorial teaching.
Feld, Jan
Salamanca, Nicolás
Zölitz, Ulf
Tertiary education, Academics, Professors, Tutors, Tutorial teaching, OECD countries,
2018
The Poor and the Rich: Preferences Over Inflation and Unemployment
http://d.repec.org/n?u=RePEc:rie:riecdt:2&r=all
What are the tradeoffs that the public is willing to accept between inflation and unemployment? We find that people dislike unemployment more than inflation. This is true for both Europe and Latin America. For the latter, the aversion to unemployment relative to inflation is much greater. Moreover, in both regions, the poor’s distaste for unemployment relative to inflation is significantly greater than that of the rich. This result contributes to the literature on the costs of inflation and questions the commonly held view that prescribes strong anti-inflationary postures as a way to implement policies consistent with the preferences of the poor.
Marc Hofstetter
José Nicolás Rosas
Monetary Policy, Central Banks, Inflation, Phillips Curve, Wellbeing, Income Distribution, Política monetaria, Bancos centrales, Inflación, Curva de Phillips, Bienestar, Distribución del ingreso
2018-10
How Do Nascent Social Entrepreneurs Respond to Rewards? A Field Experiment on Motivations in a Grant Competition
http://d.repec.org/n?u=RePEc:ums:papers:2018-21&r=all
We conducted a field experiment to identify the causal effects of extrinsic incentive cues on the sorting and performance of nascent social entrepreneurs. The experiment, carried out with one of the United Kingdom’s largest support agencies for social entrepreneurs, encouraged 431 nascent social entrepreneurs to submit a full application for a grant competition that provides cash and in-kind mentorship support through a onetime mailing sent by the agency. The applicants were randomly assigned to one of three groups: one group received a standard mailing that emphasized the intrinsic incentives of the program, or the opportunity to do good (Social treatment), and the other two groups received a mailing that instead emphasized the extrinsic incentives - either the financial rewards (Cash treatment) or the in-kind rewards (Support treatment). Our results show that an emphasis on extrinsic incentives strongly affects who applies for the grant and consequently the type of submissions received. The extrinsic reward cues “crowded out” the more prosocial candidates, leading fewer candidates to apply and fewer applicants targeting disadvantaged groups. Importantly, while the full applications submitted by candidates in the extrinsic incentives groups were more successful in receiving the grant, their social enterprises were less likely to be successful at the end of the one-year grant period. Our results highlight the critical role of intrinsic motives to the selection and performance of social enterprises and suggest that using extrinsic incentives to promote the development of successful social enterprises may backfire in the longer run.
Ina Ganguli
Marieke Huysentruyt
Chloe Le Coq
social entrepreneurship, field experiment, incentives, motivations, grants
2018
A theoretical framework to consider energy transfers within growth theory
http://d.repec.org/n?u=RePEc:arx:papers:1812.05091&r=all
Growth theory has rarely considered energy despite its invisible hand in all physical systems. We develop a theoretical framework that places energy transfers at centerstage of growth theory based on two principles: (1) goods are material rearrangements and (2) such rearrangements are done by energy transferred by prime movers (e.g. workers, engines). We derive the implications of these principles for an autarkic agent that maximizes utility subject to an energy budget constraint and maximizes energy surplus to relax such constraint. The solution to these problems shows that growth is driven by positive marginal energy surplus of energy goods (e.g. rice, oil), yet materializes through prime mover accumulation. This perspective brings under one framework several results from previous attempts to insert energy within growth theory, reconciles economics with natural sciences, and provides a basis for a general reinterpretation of economics and growth as the interplay between human desires and thermodynamic processes.
Benjamin Leiva
Octavio Ramirez
John R. Schramski
2018-12
Bayesian forecasting of electoral outcomes with new parties' competition
http://d.repec.org/n?u=RePEc:upf:upfgen:1624&r=all
We propose a new methodology for predicting electoral results that com- bines a fundamental model and national polls within an evidence synthesis framework. Although novel, the methodology builds upon basic statistical structures, largely modern analysis of variance type models, and it is car- ried out in open-source software. The methodology is largely motivated by the speci c challenges of forecasting elections with the participation of new political parties, which is becoming increasingly common in the post-2008 European panorama. Our methodology is also particularly useful for the al- location of parliamentary seats, since the vast majority of available opinion polls predict at the national level whereas seats are allocated at local level. We illustrate the advantages of our approach relative to recent competing approaches using the 2015 Spanish Congressional Election. In general the predictions of our model outperform the alternative speci cations, including hybrid models that combine fundamental and polls' models. Our forecasts are, in relative terms, particularly accurate to predict the seats obtained by each political party.
José Garcia Montalvo
Omiros Papaspiliopoulos
Timothée Stumpf-Fétizon
Multilevel models, Bayesian machine learning, inverse regression, evidence synthesis, elections
2018-12
Lying and Reciprocity
http://d.repec.org/n?u=RePEc:ces:ceswps:_7368&r=all
Recent literature has shown that lying behavior in the laboratory can well be explained by a combination of lying costs and reputation concerns. We extend the literature on lying behavior to strategic interactions. As reciprocal behavior is important in many interactions, we study a theoretical model on reciprocity where a player's altruism depends on her perception of the other player’s altruism towards herself. We analyze a sequential two-player contest and vary the second mover’s information on the first movers lying behavior. This allows us to derive predictions on the second mover’s behavior which we test empirically in a large scale online experiment and in the laboratory. In both experiments, the second mover’s lying propensity does not depend on whether the first mover has (possibly) lied or not. This robust behavioral pattern provides strong evidence that reciprocity does not play a role for lying behavior in our setting.
Simon Dato
Eberhard Feess
Petra Nieken
private information, lying, reciprocity
2018
What Do We Know about the Macroeconomic Effects of Fiscal Policy? A Brief Survey of the Literature on Fiscal Multipliers
http://d.repec.org/n?u=RePEc:ces:ceswps:_7366&r=all
This article reviews recent research findings on the effects of fiscal multipliers in normal times, during booms/busts, and in the presence of the zero lower bound. Studies on the effects of fiscal policy in open economy settings as well as contributions on the fiscal-monetary policy mix are also considered. We conclude by outlining a few research avenues that are particularly relevant from a policy standpoint.
Efrem Castelnuovo
Guay C. Lim
fiscal multipliers, business cycle, fiscal spending taxes, monetary policy
2018
A Destination-Based Allowance for Corporate Equity
http://d.repec.org/n?u=RePEc:ces:ceswps:_7363&r=all
Following renewed academic and policy interest in the destination-based principle for taxing profits—particularly through a destination-based cash flow tax (DBCFT)—this paper studies other forms of efficient destination-based taxes. Specifically, it analyzes the Destination-Based Allowance for Corporate Equity (DBACE) and Allowance for Corporate Capital (DBACC). It describes adjustments that are required to turn an origin into a destination-based versions of these taxes. These include adjustments to capital and equity, which are additional to the border adjustments needed under a DBCFT. The paper finds that the DBACC and DBACE reduce profit shifting and tax competition, but cannot fully eliminate them, with the DBACE more sensitive than the DBACC. Overall, given the potential major political cost of switching from an origin to a destination-based tax system, we conclude that advantages of the DBCFT are likely to outweigh the transitional advantages of the DBACE/DBACC.
Shafik Hebous
Alexander Klemm
destination-based taxation, ACE, ACC
2018
Welfare Effects of Capital-Market Integration in the Presence of an International Duopoly
http://d.repec.org/n?u=RePEc:ces:ceswps:_7340&r=all
We build a two-country model with an international duopoly and capital-market integration. We examine how the convergence of the cost of capital, due to its mobility, affects the welfare of each country and their joint welfare. We find that international capital mobility, which equalizes the return to capital between the two countries, reduces their joint welfare. The welfare of the host country improves for sufficiently large market size and high level of capital-market integration, while the welfare of the source country improves only in a very restrictive case with a very small market size and small differences in their initial marginal cost of capital.
Panagiotis I. Karavitis
Michael S. Michael
capital-market integration, imperfect competition, international duopoly
2018
Home Ownership and Monetary Policy Transmission
http://d.repec.org/n?u=RePEc:ces:ceswps:_7361&r=all
We present empirical evidence on the heterogeneity in monetary policy transmission across countries with different home ownership rates. We use household-level data together with shocks to the policy rate identified from high-frequency data. We find that housing tenure reacts more strongly to unexpected changes in the policy rate in Germany and Switzerland –the OECD countries with the lowest home ownership rates– compared with existing evidence for the U.S. An unexpected decrease in the policy rate by 25 basis points increases the home ownership rate by 0.8 percentage points in Germany and by 0.6 percentage points in Switzerland. The response of non-housing consumption in Switzerland is less heterogeneous across renters and mortgagors, and has a different pattern across age groups than in the U.S. We discuss economic explanations for these findings and implications for monetary policy.
Winfried Koeniger
Marc-Antoine Ramelet
monetary policy transmission, home ownership, housing tenure, consumption
2018
Let their Knowledge Flow: The Effect of Returning Refugees on Export Performance in the Former Yugoslavia
http://d.repec.org/n?u=RePEc:ces:ceswps:_7371&r=all
During the early 1990s Germany received over half a million Yugoslavian refugees fleeing war. By 2000, many of these refugees, who were under temporary protection, had been repatriated. We exploit this historical episode to provide causal evidence on the role that migrants play explaining export performance in global markets after returning to their home country. We find that the elasticity of exports to return migration is between 0.1 to 0.24 in industries where migrants were employed during their stay in Germany. In order to deal with endogeneity we use historic exogenous rules of allocation of asylum seekers across different German states to construct an instrumental variable for the treatment. The results are mostly driven by knowledge-intensive industries, and by workers in occupations intensive in analytical and managerial skills.
Dany Bahar
Andreas Hauptmann
Cem Özgüzel
Hillel Rapoport
migration, refugees, knowledge diffusion, management, exports, productivity
2018
Speculative Eurozone Attacks and Departure Strategies
http://d.repec.org/n?u=RePEc:ces:ceswps:_7343&r=all
This paper shows that the eurozone payment system does not effectively protect member states from speculative attacks. Suspicion of a departure from the common currency induces a terminal outflow of central bank money in weaker member states. TARGET2 cannot inhibit this drain but only protects central bank assets. Evidence presented here suggests that a run on Italy is already on the way. The paper also considers departure strategies of strong and weak member states and the distributive effects of an orderly eurozone dissolution.
Stefan Homburg
currency speculation, TARGET2, eurozone, Italexit, dexit, trilemma
2018
The Impact of Business and Political News on the GCC Stock Markets
http://d.repec.org/n?u=RePEc:ces:ceswps:_7353&r=all
This paper investigates the impact of business and political news on stock market returns in the Gulf Cooperation Council (GCC) countries. For this purpose, it employs a Markov switching model including a separate index for each of the two categories of news considered. The results indicate the importance of news as drivers of GCC stock returns, with business news playing a more substantial role; further, news released in the largest financial markets in the regions are found to have significant cross-border effects.
Alanoud Al-Maadid
Guglielmo Maria Caporale
Fabio Spagnolo
Nicola Spagnolo
business news, GCC countries, Markov switching model, political news
2018
Race-Blind Admissions, School Segregation, and Student Outcomes: Evidence from Race- Blind Magnet School Lotteries
http://d.repec.org/n?u=RePEc:ces:ceswps:_7335&r=all
This paper studies a school district that was federally mandated to adopt a race-blind lottery system to fill seats in its oversubscribed magnet schools. The district had previously integrated its schools by conducting separate admissions lotteries by race to offset its predominantly black applicant pools. The change dramatically segregated subsequent magnet school cohorts. More segregated schools enroll students with lower baseline achievement and employ lower valueadded teachers. Segregation is further exacerbated by “white flight” as white students transfer out of the district after attending more segregated schools. Ultimately, mandated segregation decreases student test scores and college attendance.
Jason B. Cook
keyword1, keyword2, keyword3
2018
Strikes, Employee Workplace Representation, Unionism, and Industrial Relations Quality in European Establishments
http://d.repec.org/n?u=RePEc:ces:ceswps:_7360&r=all
Using cross-country data, this paper investigates the relationship between workplace representation and strikes. Works councils are associated with reduced strike activity. However, where union members make up a majority of works councillors, such union-dominated councils experience greater strike activity than do their counterparts with minority union membership, and also more strikes than establishments with union workplace representation where union members are in a minority. Dissonance between the parties as to the state of industrial relations is associated with elevated strike activity. Finally, union density at the workplace, if not the presence of collective bargaining, is directly associated with strike incidence.
John T. Addison
Paulino Teixeira
works councils, employee representation, union density, level of collective bargaining, industrial relations quality/dissonance, strike incidence, strike duration, strike frequency, strike intensity
2018
Political Tension and Stock Markets in the Arabian Peninsula
http://d.repec.org/n?u=RePEc:ces:ceswps:_7341&r=all
This note investigates the effects of the recent political tensions in the Arabian peninsula on the linkages between the stock markets of the leading GCC countries by estimating a VAR-GARCH (1,1) model at a weekly frequency. The results indicate that the June 2017 crisis lowered stock market returns and generally led to greater volatility spillovers within the region. This evidence supports the need for further financial integration and suggests fewer portfolio diversification opportunities for investors in the GCC region.
Alanoud Al-Maadid
Guglielmo Maria Caporale
Fabio Spagnolo
Nicola Spagnolo
GCC, multivariate GARCH, political tension
2018
Who Lobbies Whom? Special Interests and Hired Guns
http://d.repec.org/n?u=RePEc:ces:ceswps:_7367&r=all
We model which special interest groups lobby which policymakers directly, and which employ for-profit intermediaries. We show that special interests affected by policy issues that frequently receive high political salience lobby policymakers directly, while those that rarely receive high political salience must employ “hired guns.” This follows from the availability of repeated agency contracts between policymakers and special interests. Special interests that lobby on issues that frequently experience high political salience may be incentivized to truthfully reveal private, policy relevant, information to policymakers via the promise of a high probability future political access. For-profit intermediaries are always in the “informational lobbying market” and can be easily incentivized by policymakers to truthfully reveal private information. We also show that “insecure” policymakers, those in vulnerable seats, tend to be lobbied by professional intermediaries. Also, policymakers that are more time constrained tend to rely more on professional intermediaries for policy relevant information.
Christopher J. Ellis
Thomas Groll
informational lobbying, constrained access, intermediaries, financial contributions
2018
Approximate Expected Utility Rationalization
http://d.repec.org/n?u=RePEc:ces:ceswps:_7348&r=all
We propose a new measure of deviations from expected utility, given data on economic choices under risk and uncertainty. In a revealed preference setup, and given a positive number e, we provide a characterization of the datasets whose deviation (in beliefs, utility, or perceived prices) is within e of expected utility theory. The number e can then be used as a distance to the theory. We apply our methodology to three recent large-scale experiments. Many subjects in those experiments are consistent with utility maximization, but not expected utility maximization. The correlation of our measure with demographics is also interesting, and provides new and intuitive findings on expected utility.
Federico Echenique
Taisuke Imai
Kota Saito
expected utility, revealed preferences
2018
The Good, the Bad, and the Ugly: Impact of Negative Interest Rates and QE on the Profitability and Risk-Taking of 1600 German Banks
http://d.repec.org/n?u=RePEc:ces:ceswps:_7358&r=all
The recent negative interest rate policy (NIRP) and quantitative easing (QE) programme by the ECB have raised concerns about the pass-through of monetary policy. On the one hand, negative rates could lead to declining bank profitability making an expansionary monetary policy contractionary. Also, if interest rates are too low for too long banks could be induced to take too much risky credit. On the other hand, several economists argue that there is nothing special about negative interest rates per se. This paper uses a large micro level data set of the German bank universe to examine how banks behave in this uncharted territory. The evidence found suggests that bank’s business model, i.e. the share of overnight deposits, plays a crucial role. While some banks may benefit in the short run via for instance reduced refinancing costs or lower loan loss provisions, many banks with high deposit ratios face lower net interest income and lower credit growth rates. If continued for too long QE and NIRP erode bank profits for most banks eventually.
Florian Urbschat
negative interest rate policy, banks’ profitability, net interest rate margin, risk-taking channel
2018
Carbon Prices are Redundant in the 2030 EU Climate and Energy Policy Package
http://d.repec.org/n?u=RePEc:ces:ceswps:_7364&r=all
In June 2018, an agreement between key EU institutions – the Commission, the European Parliament, and the European Council – was reached after a long-lasting discourse over the 2030 EU climate and energy policy package. This paper offers a comprehensive assessment of the EU package, with its three main targets: lower greenhouse gas emissions, higher renewable share in final energy consumption, and improved energy efficiency. We find that the renewable and energy-efficiency targets have been set so high that the derived emissions reduction exceeds the EU climate target. Hence, carbon prices are redundant in reaching the EU climate goal. This policy, however, is not cost efficient.
Finn Roar Aune
Rolf Golombek
climate policy, renewables, energy efficiency, nuclear phase out, energy modeling
2018
Information Nudges and Self-Control
http://d.repec.org/n?u=RePEc:ces:ceswps:_7346&r=all
We study the optimal design of information nudges for present-biased consumers who have to make sequential consumption decisions without exact prior knowledge of their long-term consequences. For arbitrary distributions of risk, there exists a consumer-optimal information nudge that is of cutoff type, recommending consumption or abstinence according to the magnitude of the risk. Under a stronger bias for the present, the target group receiving a credible signal to abstain must be tightened. We compare this nudge with those favored by a health authority or a lobbyist. When some consumers are more strongly present-biased than others, a traffic-light nudge is optimal.
Thomas Mariotti
Nikolaus Schweizer
Nora Szech
Jonas von Wangenheim
information design, information nudges, present-biased preferences, self-control
2018
The Social Cost of Carbon and the Ramsey Rule.
http://d.repec.org/n?u=RePEc:ces:ceswps:_7359&r=all
The objective of this paper is to critically assess the use simple rules for the social cost of carbon (SCC) employing a rudimentary form of the Ramsey rule. Two interrelated caveats apply. First, if climate change poses a serious problem, it is hard to justify an exogenous constant growth rate of consumption. Second, to derive the SCC one needs full knowledge of the entire future. Popular assumptions to get around this, such as assuming current GDP is optimal, are difficult to justify.
Cees A. Withagen
2018
Domestic and Global Output Gaps as Inflation Drivers: What Does the Phillips Curve Tell?
http://d.repec.org/n?u=RePEc:ces:ceswps:_7337&r=all
We study how domestic and global output gaps affect CPI inflation. We use a New-Keynesian Phillips curve framework which controls for nonlinear exchange rate movements for a panel of 26 advanced and 22 emerging economies covering the 1994Q1-2017Q4 period. We find broadly that both global and domestic output gaps are significant drivers of inflation both in the pre-crisis (1994-2008) and post-crisis (2008-2017) periods. Furthermore, after the crisis, in advanced economies the effect of the domestic output gap declines, while in emerging economies the effect of the global output gap declines. The paper demonstrates the usefulness of the New Keynesian Phillips curve in identifying the impact of global and domestic output gaps on inflation.
Martina Jašová
Richhild Moessner
Előd Takáts
output gaps, global factors, inflation
2018
Are Economic Preferences Shaped by the Family Context? The Impact of Birth Order and Siblings' Sex Composition on Economic Preferences
http://d.repec.org/n?u=RePEc:ces:ceswps:_7362&r=all
The formation of economic preferences in childhood and adolescence has long-term consequences for life-time outcomes. We study in an experiment with 525 teenagers how both birth order and siblings’ sex composition affect risk, time and social preferences. We find that second born children are typically less patient, less risk averse, and more trusting. However, siblings’ sex composition interacts importantly with birth order effects. Second born children are more risk taking only with same-sex siblings. For trust and trustworthiness, birth order effects are larger with mixed-sex siblings than in the single-sex case. Only for patience, siblings’ sex composition does not matter.
Lena Detlefsen
Andreas Friedl
Katharina Lima de Miranda
Ulrich Schmidt
Matthias Sutter
birth order, siblings’ sex composition, economic preferences, experiment
2018
Institutional Reforms and an Incredible Rise in Old Age Employment
http://d.repec.org/n?u=RePEc:ces:ceswps:_7334&r=all
We investigate whether a cut in unemployment benefit payout periods affected older workers’ labor market transitions. We apply rich administrative data and exploit a difference-indifferences approach. We compare the reference group of 40-44 year olds with constant benefit payout periods to older treatment groups with reduced payout durations. For the latter job exit rates declined, job finding rates increased, the propensity to remain employed increased, and the propensity to remain unemployed declined after the reform. These patterns suggest that the reform of unemployment benefits may be one of the reasons behind the recent incredible rise in old age employment in Germany.
Regina T. Riphahn
Rebecca Schrader
labor force participation, employment, unemployment insurance, retirement
2018
Regional Resources and Democratic Secessionism
http://d.repec.org/n?u=RePEc:ces:ceswps:_7336&r=all
Although regional resources have been shown to influence secessionist conflicts in developing countries, their effect in established democracies has largely been neglected. We integrate regional resource value and inter-regional transfers in a model on the optimal size of nations, and show that regional wealth correlates positively with secessionist party success in a large panel of regions. To establish causality, our difference-in-differences and triple-differences designs exploit that Scotland and Wales both feature separatist parties, but only an independent Scotland would profit from oil discoveries off its coast. We document an economically and statistically significant positive effect of regional resources and rule out plausible alternative explanations.
Kai Gehring
Stephan A. Schneider
fiscal federalism, inter-regional transfers, redistribution, secession, separatism, size of nations, resources, economic voting
2018
Regulation of Location-Specific Externalities
http://d.repec.org/n?u=RePEc:ces:ceswps:_7369&r=all
In this paper, we study regulation of externalities involving many small-scale polluters, where the damages from emissions depend on the polluters’ locations. Examples include nutrient and pesticide emissions from farms, particulate emissions from vehicles and home heating units, emissions of hazardous chemical compounds from small business etc. With such emission problems, regulatory authorities often apply a combination of firm-level, possibly differentiated standards for ‘cleaner’ technologies, and market-level, undifferentiated dirty input regulations. We establish general principles for how such regulations should be designed and combined. We find that the optimal regulation design crucially depends on the type of cleaner technologies available to polluters. If these are ‘emission capturing’, optimal technology standards encourage the use of cleaner technologies in both high and low damage areas, while if they are ‘input displacing’, optimal technology regulation encourages cleaner technologies in high damage areas, but discourages their use in low damage areas. Regulation should always discourage the use of dirty input and the optimal regulation intensity may be substantial, particularly if the available cleaner technologies are input displacing.
Eirik S. Amundsen
Lars Gårn Hansen
Hans Jørgen Whitta-Jacobsen
2018
R&D offshoring and home industry productivity
http://d.repec.org/n?u=RePEc:iip:wpaper:5&r=all
Offshoring R&D commonly invokes concerns regarding the loss of high value jobs and a hollowing out of technological capabilities, but it can also benefit domestic firms by enabling them to tap into the global technological frontier. We study the effect of R&D offshoring on industrial productivity in the home country using industry-level data for 18 OECD countries over a 26-year period. Simultaneity between productivity and R&D offshoring is addressed by using foreign tax policy as an instrument for offshored R&D. We show that R&D offshoring contributes positively to productivity in the home country, irrespective of the host country destination.
Gaetan de Rassenfosse
Russell Thomson
R&D offshoring, globalization, productivity, foreign R&D
2018-12
Congo's elections and its political landscape: some key insights
http://d.repec.org/n?u=RePEc:iob:apbrfs:2018008&r=all
On 23 December, Congo is scheduled to go to the polls to choose their next president, as well as national and provincial representatives. For the presidential elections, they will face the choice between Joseph Kabila’s handpicked successor Emmanuel Ramazani Shadary and 20 other candidates.
Titeca, Kristof
Thamani, James
DRC; elections
2018-12
The Economics and Politics of Revoking NAFTA
http://d.repec.org/n?u=RePEc:mie:wpaper:666&r=all
We provide a quantitative assessment of both the aggregate and the distributional effects of revoking NAFTA using a multi-country, multi-sector, multi-factor model of world production and trade with global input-output linkages. Revoking NAFTA would reduce US welfare by about 0.2%, and Canadian and Mexican welfare by about 2%. The distributional impacts of revoking NAFTA across workers in different sectors are an order of magnitude larger in all three countries, ranging from -2.7 to 2.26% in the United States. We combine the quantitative results with information on the geographic distribution of sectoral employment, and compute average real wage changes in each US congressional district, Mexican state, and Canadian province. We then examine the political correlates of the economic effects. Congressional district-level real wage changes are negatively correlated with the Trump vote share in 2016: districts that voted more for Trump would on average experience greater real wage reductions if NAFTA is revoked.
Raphael A. Auer
Barthélémy Bonadio
Andrei A. Levchenko
NAFTA, quantitative trade models, distributional effects, protectionism, trade policy
2018-12-12
Assessing the regional socio-economic impact of the European R&I programme
http://d.repec.org/n?u=RePEc:ipt:termod:201805&r=all
Structural socio-economic differences across EU regions may result in heterogeneous regional responses to changes in public spending in support to R&I. In this paper we examine the socio-economic impact at the EU aggregate level and at the regional level of alternative policy designs of the future EU R&I support programme that will be put in place after 2020. For the analysis we use the RHOMOLO spatial CGE model covering 267 EU regions. Our results indicate that public spending in support to R&I can contribute to higher aggregate GDP and employment in the EU. However, the impact of public spending in support to R&I varies considerable across regions. The R&I intensive regions benefit the most in terms of GDP and employment while other regions may suffer from a shift in public spending towards R&I support programmes.
Martin Christensen
region, growth, Horizon Europe, Research and Innovation, impact assessment, RHOMOLO
2018-12
A multidisciplinary analysis of the Belt and Road Initiative
http://d.repec.org/n?u=RePEc:liu:liucec:2018-5&r=all
The paper sheds light on and critically analyses the Belt and Road Initiative, the most ambitious financial and infrastructural plan China is promoting, inter alia, to reinforce its geopolitical role in the new global governance. After an introductive section on the evolution of the Chinese economy in the past decades, section 2 describes the background of the Initiative, with a focus on infrastructural connectivity, promotion of industrialisation in the involved areas, and collection of the capitals to be allocated for its projects. Section 3 deals with the main challenges and emerging problems, emphasising the geopolitical reactions of China's neighbouring countries to the Initiative, the delicate issues of its financial sustainability in the long term, the connected macroeconomic policies, and the evolution path of the Renminbi toward a wider internationalisation, in addition to comments on the infrastructural development. Several conclusive remarks end the work.
Natan Colombo
2018-12
Penalty-Point System, Deterrence and Road Safety: An Empirical Approach
http://d.repec.org/n?u=RePEc:pab:wpaper:18.14&r=all
Using a quasi-experimental approach, we study the causal effect of introducing a penalty-point system (PPS) on drivers, accidents, injuries and fatalities. We find that the PPS decreased the number of traffic offenders by 13.8%. In addition, the deterrence effect was directly related to the size of the point loss. The PPS reform also curbed PPS-related accidents, injuries and fatalities by 14,2%, 15.1% and 16.1%, respectively. These findings are robust to a battery of tests, including a placebo test with a fictitious reform date. Crucially, the timing of the PPS implementation had no effect on road incidents unrelated to PPS regulations.
Yolanda Rebollo-Sanz
Jesús Rodríguez-López
Nùria Rodríguez-Planas
Road safety, law enforcement, driving license, and discontinuity-based model.
2018-12
Ragnar Frisch (1895-1973)
http://d.repec.org/n?u=RePEc:hhs:osloec:2018_008&r=all
Ragnar Frisch was a Norwegian economist and statistician. He is well known for his effort in founding in 1930 the Econometric Society, the first international association in economics. In Europe it was followed by the European Economic Association in the mid-1980s. Ragnar Frisch was awarded the first Prize in Economic Sciences in Memory of Alfred Nobel, jointly with Jan Tinbergen, "for having developed and applied dynamic models for the analysis of economic processes." Frisch appreciated this prize not quite as much as the Antonio Feltrinelli prize awarded to him in 1961 by the Accademia Nazionale dei Lincei, the old and famous Italian society of which Galileo Galilei was one of the first members. Frisch is remembered internationally for his contributions to econometrics, macroeconomics and a number of other fields. He is revered in Norway for his role as teacher of students of economics over a period of 40 years and for having founded the Institute of Economics of the University of Oslo. Frisch is also known as a coiner of terms, e.g. econometrics, macroeconomics and quite a few others. The article is an account of Frisch’s early years, his education as silversmith, study years abroad etc. It includes also his own account of his experiences during the World War II and his advice given to postwar students in 1949.
Bjerkholt, Olav
Ragnar; Frisch
2018-12-10
Is the Response of the Bank of England to Exchange Rate Movements Frequency-Dependent?
http://d.repec.org/n?u=RePEc:pre:wpaper:201883&r=all
In this paper, we estimate a Small Open Economy Dynamic Stochastic General Equilibrium (SOEDSGE) model of the United Kingdom (UK), with the main focus being to test the hypothesis whether the Bank of England (BoE) responds to (frequency-dependent) exchange rate movements or not. For our purpose, we use an extended quarterly data set spanning the period of 1986:Q1 to 2018:Q1, which in turn includes the zero lower bound situation, and also estimate the SOEDSGE model based on observable data decomposed into its frequency components, under the presumption that central banks is more comfortable in responding to long-term fundamental movements in exchange rates. We find that the BoE not only responds to exchange rate movements in a statistically significant manner, but also that it primarily focuses on long-term movements of currency depreciations more strongly than short-term fluctuations of the same.
Petre Caraiani
Rangan Gupta
Small Open Economy DSGE Model, Monetary Policy Rule, Exchange Rate, Structural Estimation, Bayesian Analysis, Wavelets
2018-12
Creators’ Income Situation in the Digital Age
http://d.repec.org/n?u=RePEc:lis:liswps:755&r=all
The digital transformation imposes both opportunities and risks for creativity and for creative employment, with implications for trends in income levels and the distribution of income. First, we consider skill-biased technological change as a determinant of income and labor market outcomes in the arts. Arguably, the IT revolution has changed the demand for certain skills, with creative occupations being more in demand than general employment. Second, we consider declines in the costs of generating new works and artistic experimentation due to digital technologies, and their effect on the barriers to entry in labor markets. Third, we touch upon the rise of online contract labor in certain creative professions as a determinant of income. Here, online platforms can change creators’ access to work opportunities and it may alter the way income is distributed. We find that wage trends for creative workers in the digital age outperform general trends in the population: based on various data sources and various ways to identify creators, we see creators losing less or even gaining a better income position in relative terms. From a policy perspective, results do not lend support to the idea that creators’ income situation has systematically worsened with the rise of the internet and its intermediaries. Evidence on changing distributions of income is ambiguous as trends differ from one country to the next.
Alexander Cuntz
2018-12
Online Appendix to Oil prices in a general equilibrium model with precautionary demand for oil"
http://d.repec.org/n?u=RePEc:red:append:18-15&r=all
Online appendix for the Review of Economic Dynamics article
Conny Olovsson
2018
Labour market effects of crowdwork in US and EU: an empirical investigation
http://d.repec.org/n?u=RePEc:mod:recent:140&r=all
Does working on online labour markets have an impact on earnings and working conditions? Do crowdworkers involved in micro-task outsourcing differ in their characteristics from traditional salaried workers of similar ability? Are micro-task crowdworkers similar or different in United States and in Europe? In this paper, we address these questions by comparing outcomes in working quality between online-platform and traditional workers across the United States and Europe in a quasi-experimental approach, exploiting caregiving as an exogenous source of variation influencing participation in crowdwork rounds across the female population. We find evidence that, when controlling for workers’ observed and unobserved ability, traditional workers retain a significant premium in their earnings with respect to platform workers, though this effect is not as large as descriptive statistics may hint. Moreover, labour force in crowdworking arrangements appears to suffer from high levels of under-utilisation, relegating crowdworkers into a new category of idle workers whose human capital is neither fully utilised nor adequately compensated.
Michele Cantarella
Chiara Strozzi
crowdwork, platform economy, micro-tasks, digitalisation, working conditions.
2018-12
Who Benefits from Accountability-Driven School Closure? Evidence from New York City
http://d.repec.org/n?u=RePEc:max:cprwps:212&r=all
We estimate the effects of accountability-driven school closure in New York City on students who attended middle schools that were closed at the time of closure and students who would have likely attended a closed middle school had it remained open. We find that students who would have entered the closed school, had it not closed, attended schools that perform better on standardized exams and have higher value-added measures than did the closed schools. While we find that closure did not have any measurable effect on the average student in this group, we do find that high-performing students in this group attended higher-performing schools and experienced economically-meaningful and statistically-significant improvements in their sixth, seventh, and eighth-grade math test scores. We find that these benefits persisted for several cohorts after closure. We also find that closure adversely affected students, low-performing students in particular, who were attending schools that closed. For policymakers, our results highlight a key tradeoff of closing a low-performing school: future cohorts of relatively high-performing students may benefit from closure while low-performing students in schools designated for closure are adversely affected.
Bob Bifulco
David Schwegman
School Closure, School Accountability, Urban School Reform
2018-12
How Do Nascent Social Entrepreneurs Respond to Rewards? A Field Experiment on Motivations in a Grant Competition
http://d.repec.org/n?u=RePEc:hhs:hasite:0046&r=all
We conducted a field experiment to identify the causal effects of extrinsic incentive cues on the sorting and performance of nascent social entrepreneurs. The experiment, carried out with one of the United Kingdom’s largest support agencies for social entrepreneurs, encouraged 431 nascent social entrepreneurs to submit a full application for a grant competition that provides cash and in-kind mentorship support through a one-time mailing sent by the agency. The applicants were randomly assigned to one of three groups: one group received a standard mailing that emphasized the intrinsic incentives of the program, or the opportunity to do good (Social treatment), and the other two groups received a mailing that instead emphasized the extrinsic incentives - either the financial rewards (Cash treatment) or the in-kind rewards (Support treatment). Our results show that an emphasis on extrinsic incentives strongly affects who applies for the grant and consequently the type of submissions received. The extrinsic reward cues “crowded out” the more prosocial candidates, leading fewer candidates to apply and fewer applicants targeting disadvantaged groups. Importantly, while the full applications submitted by candidates in the extrinsic incentives groups were more successful in receiving the grant, their social enterprises were less likely to be successful at the end of the one-year grant period. Our results highlight the critical role of intrinsic motives to the selection and performance of social enterprises and suggest that using extrinsic incentives to promote the development of successful social enterprises may backfire in the longer run.
Ganguli, Ina
Le Coq, Chloé
Huysentruyt, Marieke
social entrepreneurship; field experiment; incentives; motivations; grants
2018-12-01
Trade Liberalization and the Agglomeration of Heterogeneous Entrepreneurs
http://d.repec.org/n?u=RePEc:keo:dpaper:2018-019&r=all
This paper introduces spatial sorting of heterogeneous entrepreneurs (firms) in the "foot-loose entrepreneur" trade and geography model. The model generates agglomeration from a uniform space contrary to the "footloose capital" model. The model also generates spatial sorting in reverse productivity order with the least productive entrepreneur being the first to relocate.
Toshihiro Okubo
Rikard Forslid
Agglomeration, Heterogeneous firms, Trade liberalization
Work-Family Reconciliation Policies And Women’s And Mothers’labor Market Outcomes In Rich Democracies
http://d.repec.org/n?u=RePEc:lis:liswps:754&r=all
Prominent research has claimed that work-family reconciliation policies trigger “tradeoffs” and “paradoxes” in terms of gender equality with adverse labor market consequences for women. These claims have greatly influenced debates regarding social policy, work, family, and gender inequality. Motivated by limitations of prior research, we analyze the relationship between the two most prominent work-family reconciliation policies (paid parental leave and public childcare coverage) and seven labor market outcomes (employment, full-time employment, earnings, fulltime earnings, being a manager, being a lucrative manager, and occupation percent female). We estimate multi-level models of individuals nested in a cross-section of 21 rich democracies near 2005, and two-way fixed effects models of individuals nested in a panel of 12 rich democracies over time. The vast majority of coefficients for work-family policies fail to reject the null hypothesis of no effects. The pattern of insignificance occurs regardless of which set of models or coefficients one compares. Moreover, there is as much evidence that significantly contradicts the “tradeoff hypothesis” as is consistent with the hypothesis. Altogether, the analyses undermine claims that work-family reconciliation policies trigger tradeoffs and paradoxes in terms of gender equality with adverse labor market consequences for women.
David Brady
Agnes Blome
Julie A. Kmec
2018-12
Gain-Loss Framing in Interdependent Choice
http://d.repec.org/n?u=RePEc:mpg:wpaper:2018_15&r=all
Framing influences choice. However, little is known about the underlying mechanisms behind framing effects. We study gain-loss framing in binary modified dictator games. Subjects choose the selfish option more often in the loss frame compared to the gain frame. Recording visual fixations with eye-tracking, we find that dictators focus more on their own outcomes when facing losses. This suggests that losses to the own outcome are weighted more than losses to another player.
Susann Fiedler
Adrian Hillenbrand
2018-12
SeaTE: Subjective ex ante Treatment Effect of Health on Retirement
http://d.repec.org/n?u=RePEc:mrr:papers:wp382&r=all
This paper develops an innovative approach to measuring the effect of health on retirement. The approach elicits subjective probabilities of working at specified time horizons fixing health level. Using a treatment-effect framework, within-individual differences in elicited probabilities of working given health yield individual-level estimates of the causal effect of health (the treatment) on working (the outcome). We call this effect the Subjective ex ante Treatment Effect (SeaTE). The paper then develops a dynamic programming framework for the SeaTE. This framework allows measurement of individual-level value functions that map directly into the dynamic programming model commonly used in structural microeconometric analysis of retirement. The paper analyzes conditional probabilities elicited in the Vanguard Research Initiative (VRI)—a survey of older Americans with positive assets. Among workers 58 and older, a shift from high to low health would on average reduce the odds of working by 28.5 percentage points at a two-year horizon and 25.7 percentage points at a four-year horizon. There is substantial variability across individuals around these average SeaTEs, so there is substantial heterogeneity in taste for work or returns to work. This heterogeneity would be normally unobservable and hard to disentangle from other determinants of retirement in data on realized labor supply decisions and health states. The paper’s approach can overcome the problem that estimates of the effect of health on labor supply based on behavioral (realizations) data can easily overstate the effect of health on retirement whenever less healthy workers tend to retire earlier for reasons other than health.
Pamela Giustinelli
Matthew D. Shapiro
2018-02
Erwerbstätige im unteren Einkommensbereich stärken : Ansätze zur Reform von Arbeitslosengeld II, Wohngeld und Kinderzuschlag
http://d.repec.org/n?u=RePEc:iab:iabfob:201809&r=all
"Employed persons with low earnings living in low-income households can receive social benefits in addition to their earned income. The three most important means-tested benefits available for low-wage earners in Germany are social assistance for individuals capable of working (Arbeitslosengeld II), housing allowance (Wohngeld) and the enhanced child allowance (Kinderzuschlag). There exists a distinct overlap between these three benefit programs, which creates a complex benefit structure with high marginal tax rates, which negatively affects the individual labour supply. Additionally, the three programmes are characterised by high rates of non-take-up, indicating that the effectiveness of the programs in reaching their target groups could be improved. Using the microsimulation model of the IAB (IAB-MSM), which is based on representative panel data, we analyse the outcomes of implementing an in-work benefit designed close to social assistance, which addresses the weaknesses of the existing system. We compare labour supply, distributional as well as fiscal effects with a benchmark scenario, a set of policy changes the German government has recently agreed on. The results show that the in-work-benefit is well targeted to low-income households." (Author's abstract, IAB-Doku) ((en))
Bruckmeier, Kerstin
Mühlhan, Jannek
Wiemers, Jürgen
2018-12-17
Hit where it hurts – healthcare access and intimate partner violence
http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2018-22&r=all
We exploit a change in the public healthcare entitlement of undocumented migrants in Spain to investigate the causal link between withdrawal of healthcare and changes in help-seeking behaviour of women experiencing intimate partner violence (IPV). We contribute to the new literature modelling domestic violence by taking a novel look at the role of human capital in decisions to seek help when in violent relationships. We use a difference-in-differences (DiD) methodology to compare the number of foreign applicants for protection orders before and after the reform using Spanish applicants as the counterfactual. The impact of the reform was immediate; foreign applicants decreased by 16% after the health policy reform was introduced and this drop amounts to 19% in areas with stronger enforcement of the reform. We perform several robustness checks including addressing potential bias from migration changes after the reform. Our findings are important for current policy discussions on granting/limiting access to public programs for the undocumented population. We provide evidence that restricted access to the healthcare system can have unintended negative consequences for the most vulnerable groups of the population with potentially important spill-over effects to the next generation.
Caoimhe Rice
Judit Vall Castelló
Domestic Violence, Healthcare Access, Undocumented Migrants
2018
Zur strukturellen Finanzlage der Laender: eine aktuelle Auswertung und Methodenkritik
http://d.repec.org/n?u=RePEc:mar:magkse:201837&r=all
Seit Einfuehrung der neuen Schuldenregel hat sich die Finanzlage der deutschen Bundeslaender deutlich verbessert. Nach unseren Berechnungen mit dem Aggregierten Quotierungsverfahren konnten die meisten Laender ihre strukturellen Budgetdefizite abbauen und im Jahr 2017 schon 14 Laender strukturelle Budgetueberschuesse erzielen; lediglich das Saarland und Nordrhein-Westfalen wiesen strukturelle Defizite auf. Die „strukturelle“ Besserung überzeichnet indes die Konsolidierungsfortschritte, denn sie ist zum grossen Teil dem historisch niedrigen Zinsniveau zu verdanken, das zu erheblichen Einsparungen beim Schuldendienst fuehrte. Da die Finanzierungskonditionen aber nicht dauerhaft so guenstig bleiben wie in den vergangenen Jahren, verdecken die Zinsersparnisse den bei vielen Laendern noch bestehenden Konsolidierungsbedarf. Wir plaedieren daher dafuer, nur nachhaltige Einsparungen bei den Zinslasten als strukturelle Besserung zu klassifizieren und entwickeln ein Bereinigungsverfahren, das neben den Konjunktureinfluessen auch die Verzerrung durch das aeusserst niedrige Zinsniveau beachtet. Unsere Simulationen zeigen, dass nach einer Bereinigung um die nicht nachhaltigen Einsparungen beim Schuldendienst nicht mehr 14, sondern nur neun Laender im Jahr 2017 einen strukturell mindestens ausgeglichenen Haushalt erzielt haben. Bei den verbleibenden sieben Laendern besteht teilweise noch erheblicher Konsolidierungsbedarf. Wir zeigen darueber hinaus, dass die zur quantitativen Vergleichbarkeit der Laenderfinanzen in der Regel verwandten Einwohner-Indikatoren wesentliche Strukturunterschiede zwischen den Laendern unberuecksichtigt lassen und damit zu irrefuehrenden Schlussfolgerungen fuehren koennen. Wir empfehlen daher, bei Laendervergleichen Kennzahlen zu verwenden, die strukturelle Unterschiede zwischen den Laendern bei Erwerbstaetigkeit und Produktivitaet beachten.
Heinz Gebhardt
Lars-H. R. Siemers
strukturelle Finanzlage der Laender; Schuldenbremse; Haushaltskonsolidierung; Laendervergleiche; Niedrigzinsphase
2018
The 2018 Trade War: Data and Nascent General Equilibrium Analysis
http://d.repec.org/n?u=RePEc:ias:cpaper:18-wp587&r=all
This study introduces a database of 2018 tariff increases resulting from the recent trade war and quantifies the impacts using the canonical GTAPinGAMS model calibrated to GTAP version 9 accounts. We report relatively modest economy-wide welfare impacts in this perfect-competition Armington model, with substantial impacts on the pattern of trade and output in important sectors. JEL codes: F11, F12, F17
Minghao Li
Edward J. Balistreri
Wendong Zhang
2018-12
The 2018 Trade War: Data and Nascent General Equilibrium Analysis
http://d.repec.org/n?u=RePEc:ias:fpaper:18-wp587&r=all
This study introduces a database of 2018 tariff increases resulting from the recent trade war and quantifies the impacts using the canonical GTAPinGAMS model calibrated to GTAP version 9 accounts. We report relatively modest economy-wide welfare impacts in this perfect-competition Armington model, with substantial impacts on the pattern of trade and output in important sectors. JEL codes: F11, F12, F17
Minghao Li
Edward J. Balistreri
Wendong Zhang
2018-12
The differential effect of narratives
http://d.repec.org/n?u=RePEc:mpg:wpaper:2018_16&r=all
Narratives pervade almost any aspect of our life and play a particularly important role in moral and prosocial decision-making. We study how positive (stories in favor of a prosocial action) and negative (stories in favor of a selfish action) narratives influence prosocial behavior. Our main findings are that positive narratives increase giving substantially, especially for selfish types, compared to a baseline with no narratives. Negative narratives, on the other hand, have a differential effect. Prosocial types decrease their giving, while selfish types give more than in the baseline. We also find that positive narratives lead to a binary response (comply or not comply), while negative narratives induce a more gradual trade-off.
Adrian Hillenbrand
Eugenio Verrina
2018-12
“Trust in times of economic crisis in Spain: Paradoxes for social capital theory”
http://d.repec.org/n?u=RePEc:ira:wpaper:201830&r=all
The theory of social capital suggests that trust in other individuals (social trust) and trust in institutions are closely related phenomena. People who trust more in other individuals also trust more in institutions, and vice versa. Some scholars argue that trust generates a climate of social cooperation and a sense of collaboration, which in turn promotes interest and participation in institutions. Despite the fact that both social trust and trust in institutions tend to decline when socioeconomic conditions worsen, the theory of social capital rarely takes economic variables into account. The economic crisis in Spain resulted in a paradox: a notable decline in trust in institutions, together with a surprising increase – rather than the expected decrease – in social trust. In this article we analyse the impact of a number of variables on social trust and trust in institutions before and during the economic crisis in Spain. The results confirm that economic factors had greater explanatory power for both types of trust during times of economic crisis, due mainly to increased inequality. However, the classic variables of the theory of social capital, such as how people view democracy or the extent of civic participation, continued to be significant. The data analysed here also highlight the possibility that the two types of trust did not track in a mutually supportive manner due to the emergence of the Movimiento 15M (“15M Movement”), which gave rise to the appearance of new political parties such as Podemos (“We Can”), on the extreme left of the electoral scale.
Catalina Bolancé
Jordi Caïs
Diego Torrente
Social trust, trust in institutions, economic crisis, political movements, social capital, Spain. JEL classification:H12, I31, D73
2018-12
Selection of a dynamic supply portfolio under delay and disruption risks
http://d.repec.org/n?u=RePEc:jmp:jm2018:psa1077&r=all
The problem of a multi-period supplier selection and order quantity allocation in the presence of supply chain disruption and delay risks is considered. Given a set of customer orders for finished products, the decision-maker needs to decide from which supplier and when to deliver product-specific parts required for each customer order to meet customer requested due date at a low cost or a high service level and to mitigate the impact of supply chain risks. For the selection of risk-neutral or risk-averse dynamic supply portfolio, a scenario-based stochastic mixed integer programming approach is developed. In the scenario analysis, the low probability and high impact supply disruptions are combined with the high probability and low impact supply delays. The risk-neutral portfolio is optimised by minimising expected cost or maximising expected service level. The risk-averse portfolio is optimised by calculating cost- or service-at-risk and minimising conditional cost-at risk or maximising conditional service at risk. The proposed dynamic portfolio approach leads to a time-indexed stochastic MIP formulation with a strong LP relaxation, which has proven to be computationally very efficient. The findings indicate that neglecting potential delay risks in supplier selection may lead to greater supply fluctuations and manufacturing delays.
Tadeusz Sawik
2018-12-14
A New General Theory of Economic Equilibrium
http://d.repec.org/n?u=RePEc:ige:opaper:0001&r=all
This paper lays the core foundation for a new general theory of equilibrium; The paper defines and describes macroeconomic concepts of Return on Savings (#RoS), Return on Investment (#RoI) and Return on Innovation (#RoIn) and explains an equilibrium between return on economy (#RoE) or GDP growth and the geometric mean of RoS, RoI and RoIn; The paper then goes on to show why central banks should stay away from interest rate management
Gopi Kumar Bulusu
Monetary Policy, Interest Rates, Equilibrium, Return on Innovation
2017-05
Legal Barriers to the Better Use of Health Data to Deliver Pharmaceutical Innovation
http://d.repec.org/n?u=RePEc:ohe:conrep:002096&r=all
The proliferation of health data in our ever more digitalised world of health care creates opportunities for better research around – and delivery of – pharmaceutical innovation. However, these opportunities may be constrained around the legal barriers to the use of health data for these purposes, which are poorly understood, particularly in relation to the new General Data Protection Regulation (GDPR). In this consulting report, sponsored by the European Federation of Pharmaceutical Industries and Associations (EFPIA), we summarise research evaluating the main legal barriers to the better use of health data for pharmaceutical innovation. Issues are evaluated according to barriers arising in utilising data to support six key activities across the lifecycle of a medicine - Epidemiology and pharmacoepidemiology - Identifying unmet need; Pharmacogenetics; Interventional studies; Non-interventional studies; Pharmacovigilance, and; Managed entry agreements. We conclude that the GDPR does not create new legal barriers, and that most issues identified are in fact uncertainties rather than barriers per se. There is a strong case for industry to deal proactively with the uncertainties, sharing good practice and engendering trust by co-creating a code of conduct, and promoting a shared understanding of the value to society of pharmaceutical research.
Cole, A.
Towse, A.
Economics of innovation; Measuring and valuing outcomes
2018-12-01
What's behind image? towards a better understanding of image-driven behavior
http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2018-020&r=all
Our experimental design systematically varies image concerns in a dictator/trust game. In comparison to the baseline, we either decrease the role of self-image concerns (by providing an excuse for selfish behavior) or increase the role of social-image concerns (by conveying the transfer choice to a third person). In this set up, we analyze the underlying processes that motivate subjects to give less/more. Controlling for distributional preferences and expectations, our results indicate that moral emotions (guilt and shame) are a significant determinant of pro-social behavior. The disposition to guilt explains giving in the baseline, while it does not when an excuse for selfish behavior exists. Subjects' disposition to shame is correlated to giving when their choice is public and they can be identified.
Tobias Regner
social preferences, pro-social behavior, experiments, guilt aversion, reciprocity, self-image concerns, social-image concerns, trust game
2018-12-21
Nash Implementation in Production Economies with Unequal Skills: A Characterization
http://d.repec.org/n?u=RePEc:kch:wpaper:sdes-2018-18&r=all
The present study examines production economies with unequal labor skills, where the planner is ignorant of the set of feasible allocations in advance of production. In particular, we characterize Nash implementation by canonical mechanisms by means of Maskin monotonicity and a new axiom, non-manipulability of unused skills (NUS), where the latter represents a weak independence property with respect to changes in skills. Following these characterizations, we show that some Maskin monotonic social choice correspondences are not implementable if information about individual skills is absent.
Naoki Yoshihara
Akira Yamada
Unequal labor skills, Nash implementation, Canonical mechanisms, Non-manipulability of unused skills
2018-12
Risks associated with the decarbonisation of the Polish power sector
http://d.repec.org/n?u=RePEc:ibt:report:rr052018&r=all
The Polish power sector currently stands at a crossroads, facing two alternative pathways. First, the decarbonisation pathway with radical CO2 emissions reduction, which involves a fast phase-down of coal. Second, the baseline pathway that abandons emission reduction targets, and involves a slow coal phase-down. Both pathways are associated with risks. The decarbonisation pathway requires large-scale investment in carbon-free technologies in the power sector that may crowd out investment in other sectors of the economy. Other risks associated with this pathway include the destabilisation of the power system, dependency on imported technologies and job losses in mining. The baseline pathway may involve the loss of international reputation, the waste of research and development (R&D) resources on coal technologies, and a growing dependency on imported coal. In this report we define the electricity mix associated with each pathway and compare their financial and macroeconomic costs using simulation models. We also perform a qualitative analysis of the risks that are not captured by the models. We argue that the decarbonisation pathway is unlikely to be significantly more costly than the alternative pathway of no reduction targets. Some socioeconomic risks of decarbonisation such as a potential fall in employment and increased dependency on imported technologies could be mitigated if the government communicates to firms and workers that the scale-down of coal sector is inexorable given the global commitment to combat climate change. However, it will be accompanied by a simultaneous scale-up of the sector related to carbon-free technologies.
Jan Witajewski-Baltvilks
Marek Antosiewicz
Andrzej Ceglarz
Haris Doukas
Alexandros Nikas
Jakub Sawulski
Aleksander Szpor
Baiba Witajewska-Baltvilka
low-carbon transition, DSGE and bottom-up modelling, stakeholder engagement
2018-11
On Poverty and the International Allocation of Development Aid
http://d.repec.org/n?u=RePEc:pab:wpaper:18.15&r=all
We analyze the role of poverty levels on the allocation of international development aid. We estimate “claims" for each recipient, based on the incidence and depth of poverty in its territory, and explore possible reallocations of the current (overall) official development assistance (ODA) based on those claims. We consider four allocation rules rooted in ancient sources: the Aristotelian proportional rule, two constrained egalitarian rules, inspired by Maimonides, and the Talmud rule. Each of them is grounded on different normative principles, which allows assessing claims in different ways. Our results indicate that the current allocation of international development aid cannot be supported by any of those rules, which leads us to conclude that the allocation of ODA is not driven by eradicating world's poverty as a goal.
Victor Ginsburgh
Juan D. Moreno-Ternero
Poverty; Development; Aid; Resource Allocation; Claims
2018-12
Living Standards Analysis Model: The First Prototype
http://d.repec.org/n?u=RePEc:nzt:nztwps:18/05&r=all
How do we understand the synergies and trade-offs of a given policy on area beyond that policy, such as the effect of housing on health and on income? How do we choose between policies in completely different areas, such as an education policy and a health policy? Treasury’s Living Standards Framework provides one possible starting point, but it provides little assistance tracing the many dependencies between policy areas. A model that includes those dependencies could help. The Living Standards Analysis Model (LSAM) is designed to do this. A first prototype of the model has just been developed. This model includes all eleven aspects of wellbeing as described by the OECD’s How’s Life? framework and linkages between the different aspects for a small open economy. Most models for studying wellbeing only include one or two aspects, missing the rich set of interactions that can occur with greater coverage. As an early prototype, this version of the model does have many flaws and requires significant further development, but it forms a basis for creating an improved model as well as providing some qualitatively useful results. The model is loosely based on a stocks-and-flows type of model, with a small general equilibrium model covering the market economy part of the model. This paper is focussed on the description of the model.
Anita King
US monetary policy; risk aversion; NZ funding conditions
2018-12
A Better European Architecture to Fight Money Laundering
http://d.repec.org/n?u=RePEc:iie:pbrief:pb18-25&r=all
Major banks or financial institutions in more than 15 countries in the European Union (EU) have been hit in recent years by revelations involving violations of anti–money laundering (AML) laws. These cases have underlined the serious shortcomings of the European Union’s AML regime. AML supervision of banks and other firms rests largely with the national authorities of individual EU member states, in increasing tension with the legal framework for centralized prudential supervision within the euro area and the European single market. The system depends heavily on small, lower-capacity jurisdictions to provide the first line of defense against illicit financial practices, encouraging illicit actors to seek out weak links. The result is an erosion of supervisory effectiveness in those member states where money launderers concentrate their activity, undermining the integrity of the entire European system. This study recommends the creation of a European AML Authority that would supervise banks, other financial institutions, and nonfinancial firms for AML purposes. The new agency should have high standards of governance and independence, publish all of its decisions, and be empowered to impose sufficiently large fines to deter malpractice.
Joshua Kirschenbaum
Nicolas Veron
2018-12
Economic Evaluation of Management of Dementia Patients - A Systematic Literature Review
http://d.repec.org/n?u=RePEc:hhs:lunewp:2018_041&r=all
Objective: The objective is to systematically review the literature on economic evaluations of the interventions for the management of dementia and Alzheimer patients in home, hospital or institutional care. Methods: A systematic search of published economic evaluation studies in English was conducted using specified key words in relevant databased and websites. Data extracted included methods and empirical evidence (costs, effects, incremental cost-effectiveness ratio) and we assessed if the conclusions made in terms of cost-effectiveness were supported by the reported evidence. The included studies were also assessed for reporting quality using the Consolidated Health Economic Evaluation Reporting Standards (CHEERS) checklist. Results: Twelve studies were identified and there was a considerable heterogeneity in methodological approaches, target populations, study time frames, and perspectives as well as types of interventions. Interventions for the management of dementia patients are in general, not cost-effective. Interventions at the community and home setting for managing both the dementia patients and caregivers on a large scale may have the potential to save societal resources. Conclusion: More effectiveness studies as well as good quality economic evaluations are required before implementation decisions on management strategies can be made based on cost-effectiveness.
Saha, Sanjib
Gerdtham, Ulf-G.
Toresson, Håkan
Minthon, Lennart
Jarl, Johan
Dementia; nursing home care; community care; residential care; economic evaluation
2018-12-13
La apropiación de internet en adultos mayores: desafíos planteados por las economías informales en dos ciudades de América Latina
http://d.repec.org/n?u=RePEc:pcp:pucwps:wp00466&r=all
A pesar de todos sus beneficios, el uso y la apropiación de Internet por adultos mayores sigue siendo menor en comparación de otros adultos. Pero los adultos mayores constituyen una categoría analítica bastante amplia, tanto por edad como por trayectoria previa. En este artículo, se hace énfasis en la historia laboral y educativa que configura una combinación de capitales económicos, culturales y sociales, a la Bordiex, para explicar el uso de internet y la intensidad de uso en los adultos mayores entre 60 y 75 años en Lima y el Área Metropolitana de Buenos Aires. Utilizando datos cualitativos y cuantitativos, este artículo discutirá cómo los adultos mayores que se retiran de empleos de la economía informal se encuentran en desventaja en comparación a los que vienen de trabajos más calificados y demandantes. La exclusión de la sociedad de la información se extiende más allá de la jubilación para las personas que provienen de empleos menos productivos. JEL Classification-JEL: B55, J26, O33
Roxana Barrantes
Daniela Ugarte
Adultos mayores, Apropiación de Internet, Brecha generacional, Economía informal, Trayectorias tecnológicas
2018
Who Influences the Fundamental Value of Commodity Futures in Japan?
http://d.repec.org/n?u=RePEc:koe:wpaper:1830&r=all
We present evidence on asymmetric information content in the trades of six investor groups transacting in the gold, platinum, gasoline and rubber futures markets on the Tokyo Commodity Exchange. Microstructure theory suggests that traders with greater information on the efficient price should be more profitable in the long run. Foreign investors have the greatest influence over the efficient price in the gold market, investment funds in the platinum market and retail investors in the gasoline market. Both trade and non-trade related innovations have an equal influence on the efficient price of rubber, with trades by investment funds having the largest information content in this market. We relate differences in the relative influence of investor groups to differences in market interconnectedness, the nature of the commodity and associated fundamental information.
Kentaro Iwatsubo
Clinton Watkins
Commodities, Futures, Market microstructure, Asymmetric information, Investor behaviour
2018-12
Biased Policy Professionals
http://d.repec.org/n?u=RePEc:hit:hiasdp:hias-e-81&r=all
Although the decisions of policy professionals are often more consequential than those of individuals in their private capacity, there is a dearth of studies on the biases of policy professionals: those who prepare and implement policy on behalf of elected politicians. Experiments conducted on a novel subject pool of development policy professionals (public servants of the World Bank and the Department for International Development in the UK) show that policy professionals are indeed subject to decision making traps, including the effects of framing outcomes as losses or gains, and most strikingly, confirmation bias driven by ideological predisposition, despite having an explicit mission to promote evidence-informed and impartial decision making. These findings should worry policy professionals and their principals in governments and large organizations, as well as citizens themselves. A further experiment, in which policy professionals engage in discussion, shows that deliberation may be able to mitigate the effects of some of these biases.
DERCON, Stefan
BANURI, Sheheryar
GAURI, Varun
Biases, deision making, policy professionals, framing, confirmation bias, behavioural economics
2018-12
Come rifare Maastricht. L’Europa e la stampa
http://d.repec.org/n?u=RePEc:ipu:wpaper:74&r=all
This work is fully integrated and unitary. It starts by analyzing the 2019 Stability Law and its financial accounts, which are illustrated, discussed and shared. How to reform the Maastricht parameters is then examined in some depth. One of its major conclusions is that the fiscal system should be reoriented toward a national model, similar to the one in vigour in Italy until the 1970s. Most of the work is concerned with this discussion, conducted by reporting all the articles, published and unpublished, sent to ItaliaOggi during this and the previous Legislature (2014-2018). Two papers follow, illustrating what the Bank of Italy should but cannot do, being “entangled” by BCE policy. The papers had in fact been sent to important seminars held in the Bank of Italy (2017 and 2018), but they were both rejected. Then other papers, published in Mondoperaio, Nuovi Lavori, and various newspapers, essentially delve deeper into the macroeconomic question. Here, following Keynes, it is shown that investment and amortisation are now more or less equal in the major European nations, so that net saving equates with the sum of trade surpluses and/or public deficits. This is a fundamental question, since trade surpluses are unsustainable, so public deficits become necessary and the rate of interest is compelled to zero, both in the public and the private system. A period of serious reforms is advocated, following what was thought and taught during most of the past century by the Italian School of public finance. This is illustrated by discussing my comments in a book edited by GORINI, LONGOBARDI, VITALETTI, entitled “Economia, Politica, Cultura nell’Italia del XX Secolo. Il pensiero critico di Sergio Steve”, FrancoAngeli, 2018.
Giuseppe Vitaletti
Maastricht parameters, Macroeconomic equilibrium, Fiscal reform, Italian School of public finance
2018-12
My Peers are Watching me - Audience and Peer Effects in a Pay-What-You-Want Context
http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2018-019&r=all
We experimentally investigate two relevant drivers of payments in voluntary settings: the ef- fects of audience and peers. Our 2×2 between-subjects design varies the interpersonal closeness of buyers (Strangers vs. Peers) and the observability of their payments to other buyers (Anonymous vs. Public). This allows us to enrich the research on both drivers and identify whether payment observability (audience effect), the presence of known others (peer effect), or the combination of both affects voluntary payments. Payments are, on average, higher if they are made public and if buyers feel close to each other. While the effect of audience and peers on payments is additive in total, we do not find an interaction effect, if payments are observed by peers.
Elisa Hofmann
Michael E. Fiagbenu
Asri Özgümüs
Amir M. Tahamtan
Tobias Regner
social preferences, experiments, social image concerns, Pay-What-You-Want, interpersonal closeness
2018-12-21
Testing explosive bubbles with time-varying volatility
http://d.repec.org/n?u=RePEc:not:notgts:18/05&r=all
This paper considers the problem of testing for an explosive bubble in financial data in the presence of time-varying volatility. We propose a weighted least squares-based variant of the Phillips, Wu and Yu (2011) test for explosive autoregressive behaviour. We find that such an approach has appealing asymptotic power properties, with the potential to deliver substantially greater power than the established OLS-based approach for many volatility and bubble settings. Given that the OLS-based test can outperform the weighted least squares-based test for other volatility and bubble specifications, we also suggested a union of rejections procedure that succeeds in capturing the better power available from the two constituent tests for a given alternative. Our approach involves a nonparametric kernel-based volatility function estimator for computation of the weighted least squares-based statistic, together with the use of a wild bootstrap procedure applied jointly to both individual tests, delivering a opowerful testing procedure that is asymptotically size-robust to a wide range of time-varying volatility specifications.
David Harvey
Stephen Leybourne
Yang Zu
Rational bubble; Explosive autoregression; Time-varying volatility; Weighted least squares; Right-tailed unit root testing.
Government Transfers, Work and Wellbeing: Evidence from the Russian Old-Age Pension
http://d.repec.org/n?u=RePEc:iza:izadps:dp11961&r=all
This paper examines the impacts of a large and anticipated government transfer, the Russian old-age pension, on labor supply, home production and subjective wellbeing. The discontinuity in eligibility at pension age is exploited for inference. The 2006-2011 Russian Longitudinal Monitoring Survey is employed. Causal impacts differ across the sexes. Women reduce market work and appear to increase home production. They report increased wellbeing. Men reduce labor supply without any apparent increase in wellbeing. Pension receipt does not impact household composition.
Grogan, Louise
Summerfield, Fraser
fuzzy regression discontinuity, subjective wellbeing, pensions, labor supply
2018-11
The Elasticity of Taxable Income: A Meta-Regression Analysis
http://d.repec.org/n?u=RePEc:iza:izadps:dp11958&r=all
The elasticities of taxable and broad income are key parameters in tax policy analysis. To examine the large variation in estimates found in the literature, I conduct a comprehensive meta-regression analysis using information from 51 studies containing 1,448 estimates. Heterogeneity in reported estimates is driven by regression techniques, sample restrictions and variations across countries and time. Moreover, I provide descriptive evidence of the correlation between contextual factors and the magnitude of an elasticity estimate. Selective reporting bias is prevalent in the literature and the direction of reporting bias depends on whether or not deductions are included in the tax base.
Neisser, Carina
elasticity of taxable income, income tax, behavioural response, meta-regression, analysis
2018-11
Biology and the Gender Gap in Educational Performance: The Role of Prenatal Testosterone in Test Scores
http://d.repec.org/n?u=RePEc:iza:izadps:dp11936&r=all
This paper explores the contribution of biological factors in explaining gender differences in educational performance, with a particular focus on the role of prenatal testosterone. We exploit the fact that prenatal testosterone is hypothesized to transfer in-utero from a male twin to his twin sibling causing exogenous variation in exposure to prenatal testosterone in twins. By using Dutch administrative data and controlling for potential socialization effects, we find that girls with a twin brother score 7% of a standard deviation lower on math compared to girls with a twin sister. Adherence to traditional gender norms can explain this finding, implying that our results are not just driven by biology but materialize depending on environmental factors.
Gielen, Anne C.
Zwiers, Esmée
gender performance gap, twins, prenatals tesosterone
2018-11
Leveraging Patients' Social Networks to Overcome Tuberculosis Underdetection: A Field Experiment in India
http://d.repec.org/n?u=RePEc:iza:izadps:dp11942&r=all
Peer referrals are a common strategy for addressing asymmetric information in contexts such as the labor market. They could be especially valuable for increasing testing and treatment of infectious diseases, where peers may have advantages over health workers in both identifying new patients and providing them credible information, but they are rare in that context. In an experiment with 3,182 patients at 128 tuberculosis (TB) treatment centers in India, we find peers are indeed more effective than health workers in bringing in new suspects for testing, and low-cost incentives of about $US 3 per referral considerably increase the probability that current patients make referrals that result in the testing of new symptomatics and the identification of new TB cases. Peer outreach identifies new TB cases at 25%-35% of the cost of outreach by health workers and can be a valuable tool in combating infectious disease.
Goldberg, Jessica
Macis, Mario
Chintagunta, Pradeep
tuberculosis, referrals, social networks, case finding, incentives, India, health
2018-11
Health and the Wage Rate: Cause, Effect, Both, or Neither? New Evidence on an Old Question
http://d.repec.org/n?u=RePEc:iza:izadps:dp11943&r=all
We investigate two-way causality between health and the hourly wage by employing insights from the human capital and compensating wage differential models, a panel formed from the National Longitudinal Survey of Youth 1997, and dynamic panel estimation methods in this investigation. We uncover a causal relationship between two of five measures of health and the wage in which a reduction in health leads to an increase in the wage rate in a panel of U.S. young adults who had completed their formal schooling by 2006 and were continuously employed from that year through 2011. There is no evidence of a causal relationship running from the wage rate to health in this panel. The former result highlights the multidimensional nature of health. It is consistent with an extension of the compensating wage differential model in which a large amount of effort in one period is required to obtain promotions and the wage increases that accompany them in subsequent periods. That effort may cause reductions in health and result in a negative effect of health in the previous period on the current period wage. The finding also is consistent with a model in which investments in career advancement compete with investments in health for time- the ultimate scarce resource. The lack of a causal effect of the wage on health may suggest that forces that go in opposite directions in the human capital and compensating wage differential models offset each other.
Dench, Daniel
Grossman, Michael
health, wage, causality
2018-11
Unions and Wage Inequality: The Roles of Gender, Skill and Public Sector Employment
http://d.repec.org/n?u=RePEc:iza:izadps:dp11964&r=all
We examine the changing relationship between unionization and wage inequality in Canada and the United States. Our study is motivated by profound recent changes in the composition of the unionized workforce. Historically, union jobs were concentrated among low-skilled men in private sector industries. With the steady decline in private sector unionization and rising influence in the public sector, unionization is now five times higher in the public than the private sector in both countries. Though the public sector represents only 15-20% of employment, half of unionized workers are in the public sector. Accompanying these changes was a remarkable rise in the share of women among unionized workers. Currently, approximately half of unionized employees in North America are women. While early studies of unions and inequality focused on males, recent studies examine both and reveal striking gender differences. A consistent - and puzzling - finding is that unions reduce wage inequality among men but not among women. In both countries we find striking differences between the private and public sectors in the effects of unionization on wage inequality. These differences have become more pronounced over time. At present, unions reduce economy-wide wage inequality by less than 10% in both countries. However, union impacts on wage inequality are much larger in the public sector. Once we disaggregate by sector the effects of unions on male and female wage inequality no longer differ. The key differences in union impacts are between the public and private sectors - not between males and females.
Card, David
Lemieux, Thomas
Riddell, W. Craig
wage inequality, wage structure, unions, collective bargaining, Canada, United States, public sector
2018-11
The Effect of Risk Assessment Scores on Judicial Behavior and Defendant Outcomes
http://d.repec.org/n?u=RePEc:iza:izadps:dp11948&r=all
The use of risk assessment scores as a means of decreasing pretrial detention for low-risk, primarily poor defendants is increasing rapidly across the United States. Despite this, there is little evidence on how risk assessment scores alter criminal outcomes. Using administrative data from a large county in Texas, we estimate the effect of a risk assessment score policy on judge bond decisions, defendant pretrial detention, and pretrial recidivism. We identify effects by exploiting a large, sudden policy change using a regression discontinuity design. This approach effectively compares defendants booked just before and after the policy change. Results show that adopting a risk assessment score leads to increased release on non-financial bond and decreased pretrial detention. These results appear to be driven by poor defendants. We also find risk assessment scores did not increase violent pretrial recidivism, however there is some suggestive evidence of small increases in non-violent pretrial recidivism.
Sloan, Carly Will
Naufal, George S
Caspers, Heather
pretrial detention, bail, risk assessment, recidivism, regression, discontinuity
2018-11
Institutions, Attitudes and LGBT: Evidence from the Gold Rush
http://d.repec.org/n?u=RePEc:iza:izadps:dp11957&r=all
This paper analyzes the determinants behind the spatial distribution of the LGBT population in the U.S. We relate the size of the present-day LGBT population to the discovery of gold mines during the 19th century gold rushes. Comparing the surroundings of these gold mines to other current and former mining counties, we find that there are currently 10-15% more same-sex couples in counties in which gold discoveries were made during the gold rushes. We also provide empirical evidence that residents of gold rush counties still have more favorable attitudes toward homosexuality nowadays. Our findings are consistent with two mechanisms. First, gold rushes led to a large (temporary) increase in the male-to-female ratio. Second, we show that gold rush counties were less likely to house a notable place of worship at the time of the discovery (and in the following decades) and are currently less religious, suggesting a role of institutions in shaping attitudes and norms.
Brodeur, Abel
Haddad, Joanne
persistence, LGBT, attitudes, religion
2018-11
Housing Expenditures and Income Inequality
http://d.repec.org/n?u=RePEc:iza:izadps:dp11953&r=all
In this paper, we show that, in terms of real disposable income, changes in housing expenditures dramatically exacerbate the trend of income inequality that has risen sharply in Germany since the mid-1990s. More specifically, whereas the 50/10 ratio of net household income increases by 22 percentage points (pp) between 1993 and 2013, it increases by 62 pp for income net of housing expenditures. At the same time, the income share of housing expenditures rises disproportionally for the bottom income quintile and falls for the top quintile. Factors contributing to these trends include a decline in the relative costs of homeownership versus renting, changes in household structure, and residential mobility toward larger cities. Younger cohorts spend more on housing and save less than older cohorts did at the same age, with possibly negative consequences for wealth accumulation, particularly for those at the bottom of the income distribution.
Dustmann, Christian
Fitzenberger, Bernd
Zimmermann, Markus
income inequality, housing expenditures
2018-11
Homeownership, Labour Market Transitions and Earnings
http://d.repec.org/n?u=RePEc:iza:izadps:dp11952&r=all
The paper investigates the links between homeownership, employment and earnings for which no consensus exists in the literature. Our analysis is cast within a dynamic setting and the endogeneity of each outcome is assessed through the estimation of a flexible panel multivariate model with random effects. The data we use are drawn from the French sample of the EU Survey on Income and Living Conditions for the years 2004–2013. The error terms are both correlated across equations and autocorrelated. Individual random effects are also correlated across equations. The model is estimated using a simulated maximum likelihood estimator and particular care is given to the initial conditions problem. Our results show that while homeowners have longer employment and unemployment spells, they must contend with lower earnings than tenants upon reemployment. They also stress the importance of unobserved heterogeneity in explaining the transitions on the labour and housing markets, and the relationship between earnings and the latter two. Failure to properly account for this is likely to yield biased parameter estimates.
Kamionka, Thierry
Lacroix, Guy
homeownership, unemployment, earnings, simulation based estimation, panel data
2018-11
Home Ownership and Monetary Policy Transmission
http://d.repec.org/n?u=RePEc:iza:izadps:dp11950&r=all
We present empirical evidence on the heterogeneity in monetary policy transmission across countries with different home ownership rates. We use household-level data together with shocks to the policy rate identified from high-frequency data. We find that housing tenure reacts more strongly to unexpected changes in the policy rate in Germany and Switzerland - the OECD countries with the lowest home ownership rates - compared with existing evidence for the U.S. An unexpected decrease in the policy rate by 25 basis points increases the home ownership rate by 0.8 percentage points in Germany and by 0.6 percentage points in Switzerland. The response of non-housing consumption in Switzerland is less heterogeneous across renters and mortgagors, and has a different pattern across age groups than in the U.S. We discuss economic explanations for these findings and implications for monetary policy.
Koeniger, Winfried
Ramelet, Marc-Antoine
monetary policy transmission, home ownership, housing tenure, consumption
2018-11
Strategic Fertility Behaviour, Early Childhood Human Capital Investments and Gender Roles in Albania
http://d.repec.org/n?u=RePEc:iza:izadps:dp11937&r=all
Preferences for male children in Albania are shown to have persisted through nearly half a century of communist rule, and twenty five years of economic transition. Substantial contemporary birth masculinisation is concentrated amongst higher order births. Fertility falls strongly when a firstborn child is male. Still, there is only mixed evidence that parents invest more in young boys than girls, or that women's status increases with the birth of a son. Earlier male births reduce women's midlife employment but do not appear to affect say in household resource allocation. Women in their forties who bore sons at younger ages are considerably more accepting of spousal violence.
Grogan, Louise
sex information technology, patrilocality, son preference, 1918 Albanian census, demographic and health surveys (DHS), old-age security, resource allocation, communism, household violence
2018-11
Behavioral Economic Phenomena in Decision-Making for Others
http://d.repec.org/n?u=RePEc:iza:izadps:dp11946&r=all
We examine whether biases identified in the behavioral-economics literature apply in decision-making for others (DMfO). We conduct a laboratory experiment in which subjects make decision on behalf of themselves and others in eighteen tasks that measure the following biases: present-bias in time preferences, reflection effect in risk preferences, ambiguity aversion, decoy effect, anchoring bias, endowment effect, and identifiable-victim bias. In our experiment, DMfO is DMfO simpliciter: unincentivized decisions made by one individual on behalf of another - the individual making decisions faces no direct costs or benefits when engaging in DMfO (as they would in a principal-agent framework or with bequest motives), and DMfO is not framed as giving advice or guessing behavior. We identify the following self-other discrepancies: (i) willingness to pay is higher in DMfO than in decisions for oneself in tasks associated with the anchoring bias, endowment effect, and identifiable-victim bias; and (ii) the propensity to give uninterpretable responses is higher in DMfO than in decisions for oneself. We also find order effects, with DMfO more similar to decisions for oneself when it follows them. Lastly, in response to open-ended items soliciting self-reports of their DMfO, most subjects report having followed some version of the "Golden Rule" (e.g., deciding for others as they would for themselves) or having tried to maximize the other subject's payment or utility; very few subjects report motivations that can be construed as rivalrous.
Ifcher, John
Zarghamee, Homa
decisions making for others, laboratory experiments, social preferences, anchoring bias, endowment effect, identifiable-victim bias
2018-11
HPWS in the Public Sector: Are There Mutual Gains?
http://d.repec.org/n?u=RePEc:iza:izadps:dp11965&r=all
Few studies investigate the links between high-performance work systems (HPWS) on public sector organizational performance and worker job attitudes. We fill this gap with analyses of these links using linked employer-employee surveys of workplaces in Britain in 2004 and 2011. We find robust evidence of positive associations between the use of HPWS and organizational performance in the public sector but no associations with worker attitudes. The implication is that, in contrast to similar work on the private sector in the United States (Appelbaum et al., 2000) HPWS is not delivering mutual gains for employers and employees in the British public sector.
White, Michael
Bryson, Alex
public sector, HRM, HPWS, workplace performance, job satisfaction, organizational commitment, trust
2018-11
Does Female Breadwinning Make Partnerships Less Healthy or Less Stable?
http://d.repec.org/n?u=RePEc:iza:izadps:dp11938&r=all
Economists increasingly accept that social norms have powerful effects on human behavior and outcomes. In recent history, one norm widely adhered to in most developed nations has been for men to be the primary breadwinner within mixed-gender households. As women have entered the labor market in greater numbers and gender wage differentials have declined, female breadwinning has become more common in such nations. Has this been accompanied by worse outcomes in non-monetary realms, due to the violation of the male breadwinning norm? This would be evidence that norms act to slow the pace of social evolution. We use household data from two countries to examine whether female breadwinning makes partnerships less healthy or less stable. US data from the late twentieth century shows that female breadwinning is associated with significantly more partnership problems for older couples in cross-sections and for younger couples in fixed-effects specifications. Examining more recent US and Australian data, we find that female breadwinning is associated with a modestly higher dissolution risk and a fall in some measures of reported relationship quality, but mainly for young people in cohabiting partnerships and men in less educated partnerships. We interpret these results to reflect changing social norms, plus relationship market dynamics arising from differences in the ease of access to superior partnership alternatives for women who out-earn their partners. While gender-specific breadwinning norms may be fading with time, economic realities and marriage market dynamics continue to be drivers of behavior and outcomes.
Foster, Gigi
Stratton, Leslie S.
martial dissolution, happiness, family structure, economics of gender, social norms, earnings differentials
2018-11
Embezzlement and Guilt Aversion
http://d.repec.org/n?u=RePEc:iza:izadps:dp11956&r=all
Psychological game theory can contribute to renew the analysis of unethical behavior by providing insights on the nature of the moral costs of dishonesty. We investigate the moral costs of embezzlement in situations where donors need intermediaries to transfer their donations to recipients and where donations can be embezzled before they reach the recipients. We design a novel three-player Embezzlement Mini-Game to study whether intermediaries in the laboratory suffer from guilt aversion and whether guilt aversion affects the decision to embezzle. We show that the proportion of guilt-averse intermediaries is the same irrespective of the direction of guilt and guilt aversion reduces embezzlement. Structural estimates indicate no difference in the effect of guilt aversion toward the donor and toward the recipient on intermediaries' behavior. This is striking as embezzlement affects the earnings of the recipient but not those of the donor. It shows that guilt aversion matters even when decisions have no direct monetary consequences.
Attanasi, Giuseppe
Rimbaud, Claire
Villeval, Marie Claire
embezzlement, dishonesty, guilt aversion, psychological game theory, experiment
2018-11
Health and Economic Growth: Reconciling the Micro and Macro Evidence
http://d.repec.org/n?u=RePEc:iza:izadps:dp11940&r=all
Micro-based and macro-based approaches have been used to assess the effects of health on economic growth. Micro-based approaches aggregate the return on individual health from Mincerian wage regressions to derive the macroeconomic effects of population health. Macro-based approaches estimate a generalized aggregate production function that decomposes output into its components. The microbased approach tends to find smaller effects than the macro-based approach, thus presenting a micromacro puzzle regarding the economic return on health. We reconcile these two strands of literature by showing that the point estimate of the macroeconomic effect of health is quantitatively close to that found by aggregating the microeconomic effects, controlling for potential spillovers of population health at the aggregate level. Our results justify using the micro-based approach to estimate the direct economic benefits of health interventions.
Bloom, David E.
Canning, David
Kotschy, Rainer
Prettner, Klaus
Schünemann, Johannes
productivity, population health, human capital, economic development, return on health
2018-11
Migration with Pension Reform Expectations
http://d.repec.org/n?u=RePEc:iza:izadps:dp11960&r=all
Pension reforms, which imply a reduction in the generosity of pension benefits, are becoming widespread in response to the demographic transition. The scale, the timing, and the pace of these reforms vary across countries. In this theoretical article, authors analyse individual migration decisions, by adding a component linked to the expected old-age pension benefits in sending and receiving countries in two cases: when the pension system rules are known, and when there is a risk of the pension systems reforms. The results indicate that when individuals fail to take future pension wealth into account, they can make sub-optimal migration decisions.
Góra, Marek
Ruzik-Sierdzińska, Anna
migration decision, pension benefits, pension reforms, institutional uncertainty
2018-11
Health and Economic Growth
http://d.repec.org/n?u=RePEc:iza:izadps:dp11939&r=all
The positive cross-country correlation between health and economic growth is well-established, but the underlying mechanisms are complex and difficult to discern. Three issues are of central concern. First, assessing and disentangling causality between health and economic growth is empirically challenging. Second, the relation between health and economic growth changes over the process of economic development. Third, different dimensions of health (mortality vs. morbidity, children's and women's health, and health at older ages) may have different economic effects.
Bloom, David E.
Kuhn, Michael
longevity, health, productivity, poverty traps, economic development, economic well-being, living standards, neoclassical and R&D-based growth
2018-11
Civicness Drain
http://d.repec.org/n?u=RePEc:iza:izadps:dp11955&r=all
Migration may cause not only a brain drain but also a civicness drain, leading to an uncivicness trap. We study this possibility using college choices of southern-Italian students classified as Civic if not cheating in a die-roll experiment. Local civicness is the fraction of Civic in their high-school class. A civicness drain is observed at high and low local civicness. We explain this finding in a model in which Civic and Uncivic types balance hope vs. fear of migration outcomes, taking into account economic gains, risk preferences, and their beliefs about being considered Civic in the place of destination.
Casari, Marco
Ichino, Andrea
Michaeli, Moti
De Paola, Maria
Marandola, Ginevra
Scoppa, Vincenzo
migration, Italy, honesty game, experiments, social capital
2018-11
Special Interest Groups versus Voters and the Political Economics of Attention
http://d.repec.org/n?u=RePEc:iza:izadps:dp11945&r=all
Asymmetric information between voters and legislative representatives poses a major challenge to the functioning of representative democracy. We examine whether representatives are more likely to serve long-term campaign donors instead of constituents during times of low media attention to politics. Combining data on campaign finance donations made by individuals and special interest groups with information on their preferences for particular bills, we construct novel measures of electoral and organized interests pressure that representatives face with regard to specific legislative votes. In our analysis based on 490 roll calls between 2005 and 2014 in the US House of Representatives, we find strong evidence that representatives are more likely to vote with special interests and against constituency interests when the two are in conflict. Importantly, the latter effect is significantly larger when there is less attention on politics. Thereby, we draw on exogenous newsworthy shock events that crowd out news on the legislative process, but are themselves not related to it. The opportunistic behavior seems not to be mediated by short-term scheduling of sensitive votes right after distracting events.
Balles, Patrick
Matter, Ulrich
Stutzer, Alois
attention, campaign finance, interest groups, legislative voting, mass media, media attention, roll call voting, US House of Representatives
2018-11
Monopsony in Labor Markets: A Meta-Analysis
http://d.repec.org/n?u=RePEc:iza:izadps:dp11966&r=all
When jobs offered by different employers are not perfect substitutes in the minds of workers, employers gain wage-setting power; the extent of this power can be captured by the elasticity of labor supply that each employer faces. Estimates of this parameter reported by the literature vary broadly. We collect 801 estimates from published studies, record 20 aspects of each study’s design and perform Bayesian Model Averaging to show that this observed variation is systematic and can be attributed to four groups of factors. First, estimates depend on methodologies used by the researchers: different specifications pro- duce systematically different results that are also affected by whether the study employs an identification strategy; the choice between linear and non-linear estimation techniques also matters. Second, estimates vary with the underlying data: labor markets seem to be more competitive in Europe, and less competitive in developing countries - compared to the US, Canada and Australia. The market for medical workers appears to be more monopsonistic compared to others. Third, there is evidence of publication bias in parts of the literature, which results in negative estimates of supply elasticities receiving lower probability of being reported, and a (slightly) exaggerated mean. Fourth, estimates seem to vary with study quality, with top journals publishing higher estimates and studies using larger data sets producing more evidence of competitive behavior.
Sokolova, Anna
Sorensen, Todd A.
monopsony, labor supply, meta-analysis, Bayesian Model Averaging
2018-11
Labor Market Effects of High School Science Majors in a High STEM Economy
http://d.repec.org/n?u=RePEc:iza:izadps:dp11934&r=all
This paper explores the association between studying science at the higher secondary stage and labor market earnings using nationally representative data on high school subject choices and adult outcomes for urban males in India. Results show that those who studied science in high school have 22% greater earnings than those who studied business and humanities, even after controlling for several measures of ability. These higher earnings among science students are further enhanced if the students also have some fluency in English. Moreover, greater earnings are observed among individuals with social and parental support for translating science skills into higher earnings. Science education is also associated with more years of education, likelihood of completing a professional degree, and among low ability students, working in public sector positions.
Jain, Tarun
Mukhopadhyay, Abhiroop
Prakash, Nishith
Rakesh, Raghav
high-school majors, labor markets, science, STEM, India
2018-11
Walled Cities and Urban Density in China
http://d.repec.org/n?u=RePEc:iza:izadps:dp11951&r=all
Throughout the imperial era, defensive walls surrounded Chinese cities. Although most city walls have vanished, the cities have survived. We analyze a sample of nearly 300 prefectural-level cities in China, among which about half historically had city walls. We document that cities that had walls in late imperial China have higher population and employment density today, despite the fact that their walls have long gone. Using data from various sources, we test several possible explanations of this fact, including (1) walled cities have a well-defined historical core that helps hold economic activity close to the city center today; (2) walled cities today tend to have different industry compositions that are less conducive to decentralization; (3) walled cities are situated in regions where the local geographies make it less desirable to build out; (4) walled cities have more compact shapes that facilitate high density development; and (5) walled cities are located in regions where rural land is more valuable today and discourages urban sprawl. We find that historically walled cities still have higher density after taking into account all of these factors, which we interpret as evidence of economic persistence.
Du, Jun
Zhang, Junfu
urban density, city wall, persistence, China
2018-11
A Theory of Conservative Revivals
http://d.repec.org/n?u=RePEc:iza:izadps:dp11954&r=all
Why do some societies fail to adopt more efficient political and economic institutions in response to changing economic conditions? And why do such conditions sometimes generate conservative ideological backlashes and, at other times, progressive social and political movements? We propose an explanation that highlights the interplay - or lack thereof - between productivity, cultural beliefs and institutions. In our model, production shocks that benefit one sector of the economy may induce forward-looking elites to provide public goods associated with a different, more traditional sector that benefits their interests. This investment results in more agents generating cultural beliefs complementary to the provision of the traditional good, which in turn increases the political power of the traditional elite. Hence, productivity shocks in a more advanced sector of the economy can increase investment, political power, and cultural capital associated with the more traditional sector of the economy, in the process generating a revival of beliefs associated with an outdated economic environment.
Iyigun, Murat
Rubin, Jared
Seror, Avner
institutions, conservatism, cultural beliefs, cultural transmission, institutional change, technological change
2018-11
Are Economic Preferences Shaped by the Family Context? The Impact of Birth Order and Siblings' Sex Composition on Economic Preferences
http://d.repec.org/n?u=RePEc:iza:izadps:dp11949&r=all
The formation of economic preferences in childhood and adolescence has long-term consequences for life-time outcomes. We study in an experiment with 525 teenagers how both birth order and siblings’ sex composition affect risk, time and social preferences. We find that second born children are typically less patient, less risk averse, and more trusting. However, siblings' sex composition interacts importantly with birth order effects. Second born children are more risk taking only with same-sex siblings. For trust and trustworthiness, birth order effects are larger with mixed-sex siblings than in the single-sex case. Only for patience, siblings’ sex composition does not matter.
Detlefsen, Lena
Friedl, Andreas
Lima de Miranda, Katharina
Schmidt, Ulrich
Sutter, Matthias
birth order, siblings' sex composition, economic preferences, experiment
2018-11
Brilliant Technologies and Brave Entrepreneurs: A New Narrative for African Manufacturing
http://d.repec.org/n?u=RePEc:iza:izadps:dp11941&r=all
In this paper I argue that the manufacturing sector still has an important role to play in Africa's development. Despite failing to industrialize in the past, there may be a new window of opportunity. This is due to the convergence of what has been called 'brilliant' new technologies associated with the Fourth Industrial Revolution (4IR) and a resurgence of start-up entrepreneurship. In this light I (i) show why manufacturing is vital for African economies, (ii) critically analyse the nature and impact, both in terms of opportunities and risks, of the new technologies associated with the 4IR for Africa; (iii) describe the resurgence of technological start-up entrepreneurship in Africa and (iv) call for policy support in the form of complimentary investments and regulations to allow entrepreneurs to utilize opportunities and to minimize threats. In short, a new narrative for African manufacturing is possible.
Naudé, Wim
technology, industry 4.0, entrepreneurship, development, Africa
2018-11
Anti-Social Behavior in Groups
http://d.repec.org/n?u=RePEc:iza:izadps:dp11944&r=all
This paper provides strong evidence supporting the long-standing speculation that decision-making in groups has a dark side, by magnifying the prevalence of anti-social behavior towards outsiders. A large-scale experiment implemented in Slovakia and Uganda (N=2,309) reveals that deciding in a group with randomly assigned peers increases the prevalence of anti-social behavior that reduces everyone’s but which improves the relative position of own group. The effects are driven by the influence of a group context on individual behavior, rather than by group deliberation. The observed patterns are strikingly similar on both continents.
Bauer, Michal
Cahlíková, Jana
Celik Katreniak, Dagmara
Chytilová, Julie
Cingl, Lubomir
Želinský, Tomáš
group membership, aggressive competitiveness, antisocial behavior, group decision-making, group conflict
2018-11
A Pigouvian Approach to Congestion in Matching Markets
http://d.repec.org/n?u=RePEc:iza:izadps:dp11967&r=all
Recruiting agents, or "programs" costly screen “applicants” in matching processes, and congestion in a market increases with the number of applicants to be screened. To combat this externality that applicants impose on programs, application costs can be used as a Pigouvian tax. Higher costs reduce congestion by discouraging applicants from applying to certain programs; however, they may harm match quality. In a multiple-elicitation experiment conducted in a real-life matching market, we implement variants of the Gale-Shapley Deferred-Acceptance mechanism with different application costs. Our experimental and structural estimates show that a (low) application cost effectively reduces congestion without harming match quality.
He, Yinghua
Magnac, Thierry
Gale-Shapley Deferred Acceptance Mechanism, costly preference formation, screening, stable matching, congestion, matching market place
2018-11
Informing Employees in Small and Medium Sized Firms about Training: Results of a Randomized Field Experiment
http://d.repec.org/n?u=RePEc:iza:izadps:dp11963&r=all
We analyze a German labor market program that subsidizes skill-upgrading occupational training for workers employed in small and medium sized enterprises. This WeGebAU program reimburses training costs but take-up has been low. In an experimental setup, we mailed 10,000 brochures to potentially eligible workers, informing them about the importance of skill-upgrading occupational training in general and about WeGebAU in particular. Using combined survey and register data, we analyze the impact of receiving the brochure on workers' awareness of the program, on take-up of WeGebAU and other training, and on job characteristics. The survey data reveal that the brochure more than doubled workers' awareness of the program. We do not find effects on WeGebAU program take-up or short-run labor market outcomes in the register data. However, the information treatment positively affected participation in other (unsubsidized) training among employees under 45 years.
van den Berg, Gerard J.
Dauth, Christine
Homrighausen, Pia
Stephan, Gesine
information treatment, wages, skills, employment, randomized controlled trial
2018-11
The Labeling Effect of a Child Benefits System: Evidence from Russia 1994-2015
http://d.repec.org/n?u=RePEc:iza:izadps:dp11962&r=all
Impacts of child benefits and earned incomes on child wellbeing are identified for Russia. To predict earnings, a counter-factual commodity price model is constructed using information on local industrial composition and the evolution of world prices during 1994-2015 for six key commodity exports. Discontinuity in benefits eligibility at age 16 is exploited to predict the probability of receipt. Child benefits are found not to be spent differently from earned incomes or to influence child health differentially. Benefits do not observably crowd out private transfers to households containing children. Earned incomes and child health appear to be little related.
Grogan, Louise
labour supply, Russia, child wellbeing, commodities prices, child benefits, program evaluation
2018-11
How Important Are Fixed Effects and Time Trends in Estimating Returns to Schooling? Evidence from a Replication of Jacobson, Lalonde and Sullivan, 2005
http://d.repec.org/n?u=RePEc:iza:izadps:dp11935&r=all
A substantial and rapidly growing literature has developed around estimating earnings gains from two-year college degrees using administrative data. These papers almost universally employ a person-level fixed effects strategy to estimate earnings premia net of fixed attributes. We note that the seminal piece on which these papers build, Jacobson, Lalonde and Sullivan (Journal of Econometrics, 2005), provides theoretical and empirical evidence for the importance of additionally differencing out individual time-trends. The subsequent literature has not followed suit. Through replication we ask whether this matters. We show that it does, and further that these person-level time-trends need not be computationally burdensome in large administrative data. We recommend them as a unifying econometric standard for future work.
Dynarski, Susan
Jacob, Brian A.
Kreisman, Daniel
fixed effects, community college, wages
2018-11
The effect of non-resident investments on the French sovereign spread
http://d.repec.org/n?u=RePEc:drm:wpaper:2018-52&r=all
Cross-border investments in public debt securities are a key driver of sovereign yields. Everything else being equal, higher external demand lowers the cost of public financing through debt. However, from a financial stability perspective, it seems important to assess the resilience of sovereign debt against non-resident divestments, as cross-border flows tend to be volatile.Our paper adresses this issue for the French public debt. It relies on estimating the increase in yields that is necessary for the domestic financial sector to reallocate enough of its securities portfolio to compensate for hypothetical non-resident divestments.Our results indicate that if the share of non-residents in non-central bank holdings of French public debt had decreased regularly by an extra 1.25 pp compared to actual evolution, over the year from 2016-Q3 to 2017-Q3 (hence amounting to a 5 pp decrease in total), the sovereign yield would have been by around 40bp higher in 2017-Q3. Given the amount and the maturity of gross debt issuances over this period, and using the German bund yield curves for discounting, the corresponding extra cost for public finances in 2017-Q3 would have been around 6Bn €.
Pierre Bui Quang
government bond yields, external debt, investor base, home bias, portfolio choice
2018
Social spending as a driver of economic growth: has the theoretical consensus of the 1980s led to successful economic policies?
http://d.repec.org/n?u=RePEc:hal:journl:hal-01944296&r=all
The question of how this spending affects the economic growth is a question as old as economics. While the 19th century showed their countercyclical growth during the phase of depression of the business cycle followed by ratchet effects when economic context is improving, the 20th century has studied the causes of their growth. Economic causes insist first on the correction on income losses and then introduce causality as regards with the dynamics of capital accumulation. At the end of the 1980s, a new assumption (Lucas 1988, Fontvieille 1990) suggests that social spending would have become a driver of growth. This paper searches to verify this assumption. In order to do so, it focuses on the european pathway of social spending development since the 1960s to 2014. It is shown that insofar as social spending is still sensitive to the two last business cycle phase of depression, the 1980s assumption is not invalidated. But the assumption is not verified for other reasons than the expected ones. While social spending avoiding the fall of income used to be countercyclical, the other ones, dedicated to the production of the quality of the people, are becoming acyclical.
Sandrine Michel
Economic History,Social spending,Economic growth,Economic Cycles,Endogeneous growth,Régulation Theory,Europe
2018-10-17
Herausforderungen beim Pricing im Multi-Channel-Retailing: Identifikation von Lösungsansätzen unter besonderer Berücksichtigung der Nachfragersicht
http://d.repec.org/n?u=RePEc:ddf:wpaper:45&r=all
Das Pricing bei Multi-Channel-(MC)-Händlern ist durch Besonderheiten und Herausforderungen geprägt, für welche diese Arbeit einen Überblick bietet. Außerdem generiert sie Ansätze zur Lösungsfindung, wie ein langfristig erfolgreicher Umgang mit diesen identifizierten Aspekten aussehen kann. Bereits bei den allgemeinen Einflussfaktoren auf die Preissetzung existieren unter Einbeziehung der allgemeinen Eigenschaften des MC-Handels aus Nachfrager- und Anbietersicht Besonderheiten beim MC-Pricing. Aus dem sich daraus ergebenen Preis-Spannungsfeld in Kombination mit weiteren Besonderheiten können Herausforderungen und Dilemmata im MC-Pricing abgeleitet werden: Zum einen die „geringere Wettbewerbsfähigkeit durch ein höheres stationäres und Online-Preisniveau ohne die Möglichkeit, das Preisniveau einheitlich zu verringern“ und zum anderen die „Preissetzung im Spannungsfeld zwischen Abstimmung durch Einheitlichkeit und kanalbezogener Preisdifferenzierung“. Die Ergebnisse zeigen, dass die Notwendigkeit einer produktartenspezifischen Preissetzung besteht. Auf Grundlage dieser Erkenntnisse wurde ein Modell zur Identifikation von Ansätzen zur Lösungsfindung entwickelt, welches auf möglichen Unterschieden zwischen Produktarten und Kanälen aus Nachfragersicht basiert - hinsichtlich des Kundennutzens und der wahrgenommenen Preisfairness bei kanalbezogener Preisdifferenzierung. Mithilfe einer empirischen Überprüfung durch Conjoint-Analysen und Preisfairness-Einschätzungen untersucht der Beitrag die abgeleiteten Hypothesen und entwickelt erste Ansatzpunkte zur Umsetzbarkeit für die Praxis. Als Fazit wird MC-Händlern deutlich aufgezeigt, dass es Ansätze gibt, den bestehenden Dilemmata zu begegnen. MC-Pricing verlangt jedoch eine neue systematische Sichtweise, welche darauf abzielt, eine langfristige Balance im existierenden Preis-Spannungsfeld herzustellen. Der produktartenspezifische Ansatz zeigt dabei großes Potential für weitere Forschungsbereiche auf.
Schüren-Hinkelmann, Andrea
Ziehe, Nikola
Conjoint-Analyse, Multi-Channel-Pricing, Multi-Channel-Retailing, Pricing
The euro as an international currency
http://d.repec.org/n?u=RePEc:bre:polcon:28882&r=all
Two questions should be answered in relation to the international role of the euro - is a more important international role for the euro worth pursuing, and what measures would achieve this result, if it is worth pursuing? The most significant benefit for the euro area if the euro played an increased international role would be less dependence on the dollar and a reduced ability of the United States to pursue its political objectives, which are possibly inconsistent with European Union objectives. Historically, international functions have been shared between currencies and the international weights of currencies have evolved according to a limited number of variables. The most important of these are the economic size of the issuing country, the level of development and stability of the underlying financial market, openness to capital movements, a policy stance that encourages currency internationalisation, and political and military power. With the exception of financial stability, these factors do not vary substantially in the short run and give rise to persistent, long-term trends. Thus, in the first twenty years of its existence, the euro has consistently been the second most used international currency, while the dollar has maintained the first position it has held since the second world war. The gap between the dollar and the euro is greatest in the invoicing of commodity trade and as vehicle for foreign exchange transactions, and smallest in cross-border payments. While the ranking of the dollar and the euro has not changed, the euro’s share has fluctuated, particularly in its use in international finance, in correlation with the stability of the euro financial market. This has confirmed that a necessary condition for the euro to play a greater international role is the stability of the euro-area financial system. In addition, the completion of banking union, progress on capital markets union, the issuance of a common bond, and more generally the completion of the institutional architecture of the euro area and progress on a common foreign and defence policy, would promote a wider role for the euro. The European Central Bank should also move beyond its neutral attitude towards the international use of the euro. Most of these policies would have effects well beyond the international use of the euro and, while in principle desirable, are not easy to achieve. Proposals on the international role of the euro published in December 2018 by the European Commission were the start of a journey rather than a decisive step towards a greater international role for the euro.
Konstantinos Efstathiou
Francesco Papadia
2018-12
Dynamic Consequences of Monetary Policy for Financial Stability
http://d.repec.org/n?u=RePEc:wil:wileco:2018-06&r=all
We theoretically investigate the state-dependent effects of monetary policy on macroeconomic instability. In the model, banks borrow using deposits and allocate resources to productive projects. Because banks do not actively issue equity, aggregate outcomes depend on the level of equity in the financial sector. Carefully targeted monetary policy can improve stability by increasing the rate of bank equity growth, and improve allocations by encouraging leverage when intermediation is needed. A fed put is generally stabilizing, but the marginal impact of a rate cut depends on the state of the economy. The effectiveness of monetary policy depends on the extent to which rate cuts pass through to bank returns. When banks are relatively well-capitalized, rate cuts primarily decrease banks' returns. In terms of welfare, the costs of "leaning against the wind" generally outweigh the benefits, but a fed put can improve outcomes if the costs of deviating from the inflation target are sufficiently small.
William Chen
Gregory Phelan
Monetary policy, Leaning against the wind, Financial stability, Macroeconomic instability, Banks, Liquidity
2018-10
Panel Bayesian VAR Modeling for Policy and Forecasting when dealing with confounding and latent effects
http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2018_15&r=all
The paper develops empirical implementations of the standard time-varying Panel Bayesian VAR model to deal with confounding and latent effects. Bayesian computations and mixed hierarchical distributions are used to generate posteriors of conditional impulse responses and conditional forecasts. An empirical application to Eurozone countries illustrates the functioning of the model. A survey on policy recommendations and business cycles convergence are also conducted. The paper would enhance the more recent studies to evaluate idiosyncratic business cycles, policy-making, and structural spillovers forecasting. The analysis confirms the importance to separate common shocks from propagation of country- and variable-specific shocks.
Antonio Pacifico
Hierarchical Mixture Distributions in Normal Linear Model; Bayesian Model Averaging; Panel VAR; Forecasting; Structural Spillovers; MCMC Implementations.
2018-12-15
The Transmission of an Interest Rate Shock, Standard Mitigants and Household Behavior
http://d.repec.org/n?u=RePEc:dnb:dnbwpp:615&r=all
We analyze the transmission of an interest rate shock to households in the context of a stress-test module. We examin standard mitigants, such as delays due to a future interest-rate-reset-date, tax deduction of the interest paid on mortgages, the amortization of different mortgage types and conjunctural factors. We also include the possibility of behavioral responses, where households can alleviate the effect of a shock by reducing debt using voluntary repayments. We estimate a Cragg log-normal hurdle model on loan-level data for the Dutch mortgage market. We simulate debt 30 years into the future under different scenarios for the development of the interest rate and simulating both contractual and voluntary amortization. This study finds a significant dampening role of voluntary repayments on the effects of an interest rate shock.
Mauro Mastrogiacomo
transmission of interest rate shock; voluntary repayments; loan level data
2018-12
Do Standards Improve the Quality of Traded Products?
http://d.repec.org/n?u=RePEc:eca:wpaper:2013/279619&r=all
Quality-focused non-tariff measures are increasingly adopted by policy makers to address market failures. This paper tests for their selection and quality effects in a context of information asymmetry regarding product attributes. Our theory reveals that the enforcement of quality standards (QSs) induces the exit of lowquality firms but also that of some high-quality ones. The overall quality effect is therefore ambiguous. Using French firm data, we find that the QSs imposed by destination countries increase the probability, volume and value of exports of high-productivity medium-quality firms at the expense of low-productivity highquality firms. QSs improve the average quality of exported consumption goods.
Anne-Célia Disdier
Carl Gaigné
Cristina Herghelegiu
Firm exports; quality standards; information asymmetry; product quality
2018-12
HAR Testing for Spurious Regression in Trend
http://d.repec.org/n?u=RePEc:cwl:cwldpp:2153&r=all
The usual t test, the t test based on heteroskedasticity and autocorrelation consistent (HAC) covariance matrix estimators, and the heteroskedasticity and autocorrelation robust (HAR) test are three statistics that are widely used in applied econometric work. The use of these significance tests in trend regression is of particular interest given the potential for spurious relationships in trend formulations. Following a longstanding tradition in the spurious regression literature, this paper investigates the asymptotic and finite sample properties of these test statistics in several spurious regression contexts, including regression of stochastic trends on time polynomials and regressions among independent random walks. Concordant with existing theory (Phillips, 1986, 1998; Sun, 2004, 2014), the usual t test and HAC standardized test fail to control size as the sample size n \to \infty in these spurious formulations, whereas HAR tests converge to well-defined limit distributions in each case and therefore have the capacity to be consistent and control size. However, it is shown that when the number of trend regressors K \to \infty, all three statistics, including the HAR test, diverge and fail to control size as n \to \infty. These findings are relevant to high dimensional nonstationary time series regressions.
Peter C.B. Phillips
Yonghui Zhang
Xiaohu Wang
HAR inference, Karhunen-Loève representation, Spurious regression, t-statistics
2018-12
The Role of Budget Contraints in Sequential Elimination Tournaments
http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1777&r=all
Motivated by the EU concept of Pre-Commercial Procurement and the massivepresence of SMEs in the European economy, we study how budget constraints affect R&D effort in sequential elimination tournaments. We show that introducingbudget constraints leads to a non-monotonicity in unconstrained contestants' effort.Furthermore, we show that if the budget asymmetry is not too large, unconstrainedcontestants exert higher effort than when faced with unconstrained contestants only.
Malin Arve
Olga Chiappinelli
Pre-commercial procurement, contests, budget constraints
2018
Bank Recapitalizations, Credit Supply, and the Transmission of Monetary Policy
http://d.repec.org/n?u=RePEc:dnb:dnbwpp:616&r=all
We integrate a banking sector in a standard New-Keynesian DSGE model, and examine how government policies to recapitalize banks after a crisis affect the supply of credit and the transmission of monetary policy. We examine two types of recapitalizations: immediate and delayed ones. In the steady state, both policies cause the banking sector to charge inefficiently low lending rates, which leads to an inefficiently large capital stock. Raising bank equity requirements reduces this dynamic inefficiency and increases lifetime utility. After the banking sector suffered large losses, a delay in recapitalizations creates banking sector debt-overhang. This debt-overhang leads to inefficiently high lending rates, which reduces the supply of credit and weakens the transmission of monetary policy to inflation (the transmission to output is largely unchanged). Raising bank equity requirements under these circumstances can cause lifetime utility to decline. Hence, the timing of bank recapitalizations after a crisis has several macro-economic implications.
Mark Mink
Sebastiaan Pool
bank recapitalizations; credit supply; monetary policy transmission; bank equity requirements; NK-DSGE models
2018-12
Does Housing Vintage Matter? Exploring the Historic City Center of Amsterdam
http://d.repec.org/n?u=RePEc:dnb:dnbwpp:617&r=all
A home is typically thought of as a bundle of land and structure. Land is supplied inelastically and is non-reproducible. Land values are therefore affected by a number of demand factors. Conceptually, structures are easily produced, and thus are supplied elastically. Under elastic supply, it is reasonable to assume that replacement cost should be equivalent to the value of the structure for new properties. Here, we examine how particular structure characteristics may introduce heterogeneity into these demand and supply relationships. In other words, how do structure vintages influence price dynamics. Older vintages are not easily reproducible leading to the value of an older vintage to potentially diverge from its replacement cost. To test our hypotheses, we employ a nonlinear model in a Bayesian structural timeseries approach that explicitly disentangles structure and land values to identify vintage effects separately from physical deterioration and land values. We find large differences in price dynamics between four distinct vintages of Amsterdam old city center apartments. Between 1999 - 2016, new construction had an average return of 1.7%, with a standard deviation of 2.4%. On the other hand, properties build in the 19th century had an average return of 3.6% with a standard deviation of 6.1%, during the same period.
Lyndsey Rolheiser
Dorinth van Dijk
Alex van de Minne
land and structure prices; depreciation; new construction; structural time series
2018-12
Improving Food Environments in Schools: Tracking Progress
http://d.repec.org/n?u=RePEc:mpr:mprres:7d68fb2aeaed4375be48a996b5944c24&r=all
Making positive changes in the types of foods available to children in schools has the potential to have a substantial impact on their dietary intakes and the prevalence of childhood obesity.
Mary Kay Fox
School Meals , NSLP , SNDA , School Lunch Program
Re-use of collateral: leverage, volatility, and welfare
http://d.repec.org/n?u=RePEc:ecb:ecbwps:20182218&r=all
We assess the quantitative implications of collateral re-use on leverage, volatility, and welfare within an infinite-horizon asset-pricing model with heterogeneous agents. In our model, the ability of agents to reuse frees up collateral that can be used to back more transactions. Re-use thus contributes to the buildup of leverage and significantly increases volatility in financial markets. When introducing limits on re-use, we find that volatility is strictly decreasing as these limits become tighter, yet the impact on welfare is non-monotone. In the model, allowing for some re-use can improve welfare as it enables agents to share risk more effectively. Allowing re-use beyond intermediate levels, however, can lead to excessive leverage and lower welfare. So the analysis in this paper provides a rationale for limiting, yet not banning, re-use in financial markets. JEL Classification: D53, G01, G12, G18
Brumm, Johannes
Grill, Michael
Kubler, Felix
Schmedders, Karl
heterogeneous agents, leverage, re-use of collateral, volatility, welfare
2018-12
Long-run Economic, Budgetary and Fiscal Effects of Roma Integration Policies
http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2018_12&r=all
Although, the need for an efficient Roma integration policy is growing in Europe, surprisingly little robust scientific evidence regarding potential policy costs and expected benefits of alternative policy options has supported the policy design and implementation so far. The present study attempts to narrow this evidence gap and aims to shed light on long-run economic, budgetary and fiscal effects of selected education and employment policies for the inclusion of the marginalised Roma in the EU. We employ a general equilibrium approach that allows us to assess not only the direct impact of alternative Roma integration policies but also to capture all induced feedback effects. Our simulation results suggest that, although Roma integration policies would be costly for the public budget, in the medium- to long-run, economic, budgetary and fiscal benefits may significantly outweigh short- to medium-run Roma integration costs. Depending on the integration policy scenario and the analysed country, the full repayment of the integration policy investment (positive net present value) may be achieved after 7 to 9 years. In terms of the GDP, employment and earnings, the universal basic income scenario may have the highest potential, particularly in the medium- to long-run.
Pavel Ciaian
Andrey Ivanov
d’Artis Kancs
Roma, social marginalisation, education, labour market, integration policy, universal basic income.
2018-12-12
Inequality and market concentration, when shareholding is more skewed than consumption
http://d.repec.org/n?u=RePEc:een:camaaa:2018-62&r=all
Economic theory suggests that monopoly prices hurt consumers but benefit shareholders. But in a world where individuals or households can be both consumers and shareholders, the impact of market power on inequality depends in part on the relative distribution of consumption and corporate equity ownership across individuals or households. The paper calculates this distribution for the United States, using data from the Survey of Consumer Finances and the Consumer Expenditure Survey, spanning nearly three decades from 1989 to 2016. In 2016, the top 20 percent consumed approximately as much as the bottom 60 percent, but had 13 times as much corporate equity. Because ownership is more skewed than consumption, increased mark-ups increase inequality. Moreover, over time, corporate equity has become even more skewed relative to consumption.
Joshua Gans
Andrew Leigh
Martin Schmalz
Adam Triggs
Monopoly, market power, inequality
2018-12
Occupational income scores and immigration assimilation. Evidence from the Canadian census
http://d.repec.org/n?u=RePEc:ehl:wpaper:91317&r=all
Little evidence is available to assess the effect of substituting occupation-based income scores for individual incomes before 1940. The example of immigrant assimilation in Canada 1911-1931 reveals differences in the extent and even the direction of assimilation depending on whether income scores are used and how the occupational income score is constructed. Given the increasingly wide use of income scores, we summarize a number of procedures to address the limitations associated with the absence of individual level income variation. An adjustment of conventional income scores for either group earnings differences and/or intertemporal change using summary information for broad groups of occupations reduces the deviation between scores and actual incomes.
Inwood, Kris
Minns, Chris
Summerfield, Fraser
2018-12
The Performance of US Hospitals as Reflected in Risk-Standardized 30-Day Mortality and Readmission Rates for Medicare Beneficiaries with Pneumonia
http://d.repec.org/n?u=RePEc:mpr:mprres:29025ac87e7e4038ae36e51135b2286a&r=all
Using hospital and outpatient Medicare claims between 2006 and 2009, this cross-sectional study describes patterns of hospital and regional performance in the outcomes of elderly patients with pneumonia, a leading cause of hospitalization and death in this population.
Peter K. Lindenauer
Susannah M. Bernheim
Jacqueline N. Grady
Zhenqiu Lin
Yun Wang
Yongfei Wang
Angela R. Merrill
Lein F. Han
Michael T. Rapp
Elizabeth E. Drye
Sharon-Lise T. Normand
Harlan M. Krumholz
Community-Acquired and Nosocomial Pneumonia , Quality Improvement , Outcomes Measurement , Patient Safety, Geriatric Patient
Efficient Counterfactual Learning from Bandit Feedback
http://d.repec.org/n?u=RePEc:cwl:cwldpp:2155&r=all
What is the most statistically e?icient way to do o?-policy optimization with batch data from bandit feedback? For log data generated by contextual bandit algorithms, we consider o?line estimators for the expected reward from a counterfactual policy. Our estimators are shown to have lowest variance in a wide class of estimators, achieving variance reduction relative to standard estimators. We then apply our estimators to improve advertisement design by a major advertisement company. Consistent with the theoretical result, our estimators allow us to improve on the existing bandit algorithm with more statistical con?dence compared to a state-of-theart benchmark.
Yusuke Narita
Shota Yasui
Kohei Yata
Machine Learning, Artificial Intelligence, Bandit Algorithm, Counterfactual Prediction, Propensity Score, Semiparametric Efficiency Bound, Advertisement Design
2018-12
Quantitative Easing, Collateral Constraints, and Financial Spillovers
http://d.repec.org/n?u=RePEc:cwl:cwldpp:2154&r=all
The steady application of Quantitative Easing (QE) has been followed by big and non-monotonic e?ects on international asset prices and international capital flows. These are di?icult to explain in conventional models, but arise naturally in a model with collateral. This paper develops a general-equilibrium framework to explore QE’s international transmission involving an advanced economy (AE) and an emerging market economy (EM) whose assets have less collateral capacity. Capital flows arise as a result of international sharing of scarce collateral. The crucial insight is that private AE agents adjust their portfolios in di?erent ways in response to QE, conditional on whether they are (i) fully leveraged, (ii) partially leveraged or (iii) unleveraged. These portfolio shifts of international assets can diminish or even reverse the e?ectiveness of ever-larger QE interventions on asset prices. The model provides a simultaneous interpretation of several important stylized facts associated with QE.
John Geanakoplos
Kieran Haobin Wang
Quantitative easing, Collateral, Leverage, Financial spillovers, Emerging markets, Capital flows
2018-12
The economics of sharing macro-longevity risk
http://d.repec.org/n?u=RePEc:dnb:dnbwpp:618&r=all
Pension funds face macro-longevity risk or uncertainty about future mortality rates. We analyze macro-longevity risk sharing between cohorts in a pension fund as a risk management tool. We show that both the optimal risk-sharing rule and the welfare gains from risk sharing depend on the retirement age policy. Welfare gains from sharing macro-longevity risk measured on a 10-year horizon in case of a fixed retirement age are between 0.2 and 0.3 percent of certainty equivalent consumption after retirement. Cohorts experience a similar impact of macro-longevity risk on post retirement consumption and it is not optimal for young cohorts to absorb risk of older cohorts. However, in case the retirement age is fully linked to changes in life expectancy, the welfare gains are substantially higher. The risk bearing capacity of workers is larger when they use their labor supply as a hedge against macro-longevity risk. As a result, workers absorb risk from retirees in the optimal risk-sharing rule, thereby increasing the welfare gain up to 2.7 percent.
Dirk Broeders
Roel Mehlkopf
Annick van Ool
Macro-longevity risk; risk sharing; welfare analysis; retirement age
2018-12
Efficient Counterfactual Learning from Bandit Feedback
http://d.repec.org/n?u=RePEc:cwl:cwldpp:2156&r=all
1960 to 1980 doubling (21% to 41%) of black children in one-parent families emerged from 1940-to-1970 urbanization converging population toward urbanized blacks’ historically stable high rate, not post-1960 welfare liberalization or deindustrialization. Urban and rural child socializations structured di?erent Jim Crow Era black family formations. Agrarian economic enclaves socialized conformity to Jim Crow and two-parent families; urban enclaves rebellion, male joblessness, and destabilized families. Proxying urban/rural residence at age 16 for socialization location, logistic regressions on sixties census data con?rm the hypothesis. Racialized urban socialization negatively a?ected two-parent family formation and poverty status of blacks but not whites.
Gerald D. Jaynes
Behavioral Economics, Logistic Regression
2018-11
Merger and Acquire of Series: A New Approach of Time Series Modeling
http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2018_16&r=all
Present paper proposes an autoregressive time series model to study the behaviour of merger and acquire concept which is equally important as other available theories like structural break, de- trending etc. The main motivation behind newly proposed merged autoregressive (M-AR) model is to study the impact of merger in the parameters as well as acquired series. First, we recommend the estimation setup using popular classical least square and posterior distribution under Bayesian method with different loss function. Then, we obtain Bayes factor, full Bayesian significance test and credible interval to know the significance of the merger series. A simulation as well as empirical study is illustrated.
Jitendra Kumar
Varun Agiwal
Autoregressive model, Break point, Merger series, Bayesian inference.
2018-12-16
Optimal Pseudo-Gaussian and Rank-Based Random Coefficient Detection in Multiple Regression
http://d.repec.org/n?u=RePEc:eca:wpaper:2013/279634&r=all
Random coefficient regression (RCR) models are the regression versions of random effects models in analysis of variance and panel data analysis. Optimal detection of the presence of random coefficients (equivalently, optimal testing of the hypothesis of constant regression coefficients) has been an open problem for many years. The simple regression case has been solved recently (Fihri et al. (2017)), and the multiple regression case is considered here. This problem poses several theoretical challenges (a)a nonstandard ULAN structure, with log-likelihood gradients vanishing at the null hypothesis; (b) a cone-shaped alternative under which traditional maximin-type optimality concepts are no longer adequate; (c) a matrix of nuisance parameters (the correlation structure of the random coefficients) that are not identified under the null but have a very significant impact on local powers. Inspired by Novikov (2011), we propose a new (local and asymptotic) concept of optimality for this problem, and, for specified error densities, derive the corresponding parametrically optimal procedures.A suitable modification of the Gaussian version of the latter is shown to remain valid under arbitrary densities with finite moments of order four, hence qualifies as a pseudo-Gaussian test. The asymptotic performances of those pseudo-Gaussian tests, however, are rather poor under skewed and heavy-tailed densities. We therefore also construct rank-based tests, possibly based on data-driven scores, the asymptotic relative efficiencies of which are remarkably high with respect to their pseudo-Gaussian counterparts.
Abdelhadi Akharif
Mohamed Fihri
Marc Hallin
Amal Mellouk
Random Coefficient; Multiple RegressionModel; Local Asymptotic Normality; Pseudo-Gaussian Test; Aligned Rank Test; Cone Alternative
2018-12
Dynamic Panel Modeling of Climate Change
http://d.repec.org/n?u=RePEc:cwl:cwldpp:2150&r=all
We discuss some conceptual and practical issues that arise from the presence of global energy balance effects on station level adjustment mechanisms in dynamic panel regressions with climate data. The paper provides asymptotic analyses, observational data computations, and Monte Carlo simulations to assess the use of various estimation methodologies, including standard dynamic panel regression and cointegration techniques that have been used in earlier research. The findings reveal massive bias in system GMM estimation of the dynamic panel regression parameters, which arise from fixed effect heterogeneity across individual station level observations. Difference GMM and Within Group (WG) estimation have little bias and WG estimation is recommended for practical implementation of dynamic panel regression with highly disaggregated climate data. Intriguingly from an econometric perspective and importantly for global policy analysis, it is shown that despite the substantial differences between the estimates of the regression model parameters, estimates of global transient climate sensitivity (of temperature to a doubling of atmospheric CO {2}) are robust to the estimation method employed and to the specific nature of the trending mechanism in global temperature, radiation, and CO {2}.
Peter C.B. Phillips
Climate modeling, Cointegration, Difference GMM, Dynamic panel, Spatio-temporal modeling, System GMM, Transient climate sensitivity, Within group estimation
2018-12
The Price of BitCoin: GARCH Evidence from High Frequency Data
http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2018_14&r=all
The present paper analyses the BitCoin price formation accounting for the both transaction demand and speculative demand. We apply a GARCH model to high frequency data for the period 2013–2018. In line with the theoretical model, our empirical results confirm that the BitCoin transaction demand and speculative demand for BitCoin have a statistically significant impact on the BitCoin price formation. The BitCoin price responds negatively to higher BitCoin velocity, whereas the BitCoin stock, interest rate and the size of the BitCoin economy exercise an upward pressure on the BitCoin price.
Pavel Ciaian
d'Artis Kancs
Miroslava Rajcaniova
Virtual currencies, BitCoin returns, volatility, price formation, GARCH.
2018-12-14
What Predicts Sex Partners' Age Differences Among African American Youth? A Longitudinal Study from Adolescence to Young Adulthood
http://d.repec.org/n?u=RePEc:mpr:mprres:15ebae7b87244aa4a94aaeda7482eb2c&r=all
Using growth curve modeling, this study describes the shape of the age difference between participants and their sex partners across adolescence and young adulthood in a sample of African American youth, by evaluating the co-occurrence of other risk behaviors.
José A. Bauermeister
Marc A. Zimmerman
Cleopatra H. Caldwell
Yange Xue
Gilbert C. Gee
Sex Partners , Youth Sex , Risk Behaviors , Sexually Transmitted Infections
Nigeria's Perspective on Total Official Support for Sustainable Development (TOSSD)
http://d.repec.org/n?u=RePEc:oec:dcdaaa:50-en&r=all
The Working Paper summarises the main findings and recommendations of the pilot study, including first orders of magnitude of TOSSD flows to Nigeria. Estimated TOSSD flows to Nigeria in 2016 amounted to approximately USD 3 billion of official development finance and USD 1.9 billion of private finance mobilised through official development interventions. These first orders of magnitude have been estimated using OECD DAC Statistics. However, these figures are likely to be largely underestimated due to information gaps, notably on the People’s Republic of China (hereafter China) and emerging providers’ official support to Nigeria. The results of the pilot also indicate that the current organisational set up of Nigeria, both from an institutional and an IT system perspective, makes it challenging for the Government to access, collate, collect analyse and use data on external financing to the country using national data.The TOSSD pilot in Nigeria confirmed the usefulness of country pilots for testing the TOSSD methodology and for ensuring feedback by partner countries on TOSSD as a measurement framework. The findings also helped to ascertain that the International TOSSD Task Force developing the framework is in the right direction with regard to the main parameters of the measure. Findings contained in the present Working Paper will support the discussions to refine the emerging TOSSD Reporting Instructions in 2018 and 2019.
Guillaume Delalande
Friederike Rühmann
Aussama Bejraoui
Julia Benn
Development Finance, Economic Development, Nigeria, SDG, TOSSD, Transparency
2018-12-20
A macro-financial analysis of the corporate bond market
http://d.repec.org/n?u=RePEc:ecb:ecbwps:20182214&r=all
We assess the contribution of economic and financial factors in the determination of euro area corporate bond spreads over the period 2001-2015. The proposed multi-market, no-arbitrage affine term structure model is based on the methodology proposed by Dewachter, Iania, Lyrio, and Perea (2015). We model jointly the ‘risk-free curve’, measured by overnight index swap (OIS) rates, and the corporate yield curves for two rating classes (A and BBB). The model includes four spanned and six unspanned factors. We find that, in general, both economic (real activity and inflation) and financial factors (proxying risk aversion, flight to liquidity and general financial market stress) play a significant role in the determination of the spanned factors and hence in the dynamics of the risk-free yield curve and corporate bond spreads. Across the risk-free OIS curve, macroeconomic and financial factors are each responsible on average for explaining 30 and 65 percent of yield varation, respectively. For A- and BBB-rated corporate debt, the selected financial variables explain on average 50 percent of the variation in corporate spreads during the last decade. JEL Classification: E43, E44
Dewachter, Hans
Iania, Leonardo
Lemke, Wolfgang
Lyrio, Marco
euro area corporate bonds, unspanned macro factors, yield spread decomposition
2018-12
Integration of Migrants, Refugees and Asylum Seekers in Remote Areas with Declining Populations
http://d.repec.org/n?u=RePEc:oec:cfeaaa:2018/03-en&r=all
This paper examines whether immigration can operate as a counter-process of depopulation and economic recession. Based on the comparative analysis of four case studies in Belluno (Italy), Klagenfurt-Villach (Austria), Dalarna (Sweden), and Haßberge (Germany), it analyses the key socio-economic factors explaining the successful integration of migrants, refugees, status holders and asylum seekers and examines under which conditions the arrival of newcomers can turn into a local development opportunity for these territories. The case studies feature four remote territories with the following common characteristics: they have undergone significant socio-economic transformations over the past decade, they face a population decline with an alarming outmigration of youth combined with an increasing ageing population, and central governments have channelled recent immigration and asylum seekers to peripheral areas to counterbalance negative demographic trends. Results show that integration paths undertaken by recipients differ significantly across the four territories. However, all case studies suggest that stable jobs and accommodations render remote and mountain localities attractive for refugees and status holders, who are usually more inclined to move to urban centres. Lastly, results from the case studies highlight the importance of designing individualised integration paths backed by social inclusion initiatives that can incite spontaneous collaborations and work relations with local inhabitants.
Giulia Galera
Leila Giannetto
Andrea Membretti
Antonella Noya
ageing, asylum-seekers, immigration, integration, migrants, refugees, social innovation
2018-12-19
Transition Finance Challenges for Commodity-based Least Developed Countries: The example of Zambia
http://d.repec.org/n?u=RePEc:oec:dcdaaa:49-en&r=all
The Zambia country pilot study was conducted by the OECD Development Assistance Committee (DAC) to explore the challenges of transition finance for a commodity-based Least Developed Country (LDC). In particular, debt sustainability concerns are viewed within the context of the shifting financing for sustainable development landscape of Zambia following its re-classification to Lower Middle Income Category (LMIC).In line with the Addis Ababa Action Agenda (AAAA), the pilot study proposes a new “ABC” approach targeted to assess all available sources of financing (official development finance, private investment, domestic resources, and remittances), identify emerging SDG financing gaps and promote better alignment of resources with national financing for sustainable development strategies.
Jieun Kim
Olivier Cattaneo
Arnaud Pincet
Konstantin Poensgen
Addis Ababa Action Agenda, commodity exporter, debt sustainability, financing for sustainable development, LDC, SDGs, Transition finance, Zambia
2018-12-19
Domestic and external sectoral portfolios: network structure and balance-sheet contagion
http://d.repec.org/n?u=RePEc:ecb:ecbwps:20182215&r=all
This paper uses a unique comprehensive database on French security assets and liabilities to study the dynamics of domestic and external sectoral portfolios, their network structure, and their role in the propagation of shocks. We first show how the sharp deterioration of the net external portfolio position of France between 2008 and 2014 was driven by sectoral patterns such as the banking sector retrenchment and the increase in foreign liabilities of the public and corporate sectors, but was mitigated by the expansion of domestic and foreign asset portfolios of insurance companies. We also provide a network representation of the links between domestic sectors and the rest of the world, and document their evolution between 2008 and 2014. Second, we put forward and estimate a model of balance-sheet contagion through inter-sectoral security linkages. The estimation of the model shows that the financial sectors of the economy (banking, mutual fund, and insurance sector) are affected by balance-sheet contagion. JEL Classification: F30, G11, G20
Valla, Natacha
Rancière, Romain
Heipertz, Jonas
asset demand and supply, portfolio investments, sectoral inter-linkages
2018-12
Family-Driven Youth-Guided Practices in Residential Treatment: Findings from a National Survey of Residential Treatment Facilities
http://d.repec.org/n?u=RePEc:mpr:mprres:6965b56d03b8460b8d2dcf5f92158574&r=all
This study reports findings from a national survey of residential treatment providers that examined adoption of family-driven, youth-guided practices.
Jonathan D. Brown
Kirsten Barrett
Henry T. Ireys
Kamala Allen
Sheila A. Pires
Gary Blau
family-driven , youth-guided , residential treatment systems of care
Progressive taxation and (in)stability in an exogenous growth model with non-market ("home") production
http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2018_13&r=all
We show that in a exogenous growth model with non-market (”home”) sector calibrated to Bulgarian data under the progressive taxation regime (1993-2007), the economy exhibits equilibrium indeterminacy due to the presence of non-market production. These results are in line with the findings in Benhabib and Farmer (1994, 1996) and Farmer (1999). Also, the findings in this paper are in contrast to Guo and Lansing (1988) who argue that progressive taxation works as an automatic stabilizer. Under the flat tax regime (2008-16), the economy calibrated to Bulgarian data displays saddle-path stability. The decrease in the average effective tax rate addresses the indeterminacy issue and eliminates the ”stable focus” dynamics.
Aleksandar Vasilev
Progressive taxation; Non-market Sector; Home Production; Equilibrium (In)determinacy.
2018-12-13
International spillovers of monetary policy: evidence from France and Italy
http://d.repec.org/n?u=RePEc:ecb:ecbwps:20182216&r=all
In this paper we provide empirical evidence on the impact of US and UK monetary policy changes on credit supply of banks operating in Italy and France over the period 2000–2015, exploring the existence of an international bank lending channel based on the reliance on funding sources located in these two countries or denominated in their currency. We find that US monetary policy tightening leads to a reduction of lending to the domestic economy in both France and Italy, and this is mainly driven by banks that relied more intensely on USD funding markets. Conversely, we find that both French and Italian banks are isolated from UK monetary policy shocks, as most of their UK funding is denominated in Euro, despite being larger than funding from the US. JEL Classification: E51, F30, F42, G20
Caccavaio, Marianna
Carpinelli, Luisa
Marinelli, Giuseppe
Schmidt, Julia
bank lending channel, foreign funding, global banks
2018-12
Gambling traps
http://d.repec.org/n?u=RePEc:ecb:ecbwps:20182217&r=all
I propose a dynamic general equilibrium model in which strategic interactions between banks and depositors may lead to endogenous bank fragility and slow recovery from crises. When banks’ investment decisions are not contractible, depositors form expectations about bank risk-taking and demand a return on deposits according to their risk. This creates strategic complementarities and possibly multiple equilibria: in response to an increase in funding costs, banks may optimally choose to pursue risky portfolios that undermine their solvency prospects. In a bad equilibrium, high funding costs hinder the accumulation of bank net worth and lead to a “gambling trap” with a persistent drop in investment and output. I bring the model to bear on the European sovereign debt crisis, in the course of which under-capitalized banks in default-risky countries experienced an increase in funding costs and raised their holdings of domestic government debt. The model is quantied using Portuguese data and accounts for macroeconomic dynamics in Portugal in 2010-2016. Policy interventions face a trade-off between alleviating banks’ funding conditions and strengthening risk-taking incentives. Liquidity provision to banks may perpetuate gambling traps when not targeted. Targeted interventions have the capacity to eliminate adverse equilibria. JEL Classification: E44, F30, F34, G01, G21, G28, H63
Ari, Anil
banking crises, financial constraints, risk-taking, sovereign debt crises
2018-12
Changes in Capacity Among Local Coordinated Community Response Coalitions (CCRs) Supported by the DELTA Program
http://d.repec.org/n?u=RePEc:mpr:mprres:ccae4999324c4a88aca4f70c666fec8c&r=all
Using survey data collected from coordinated community responses (CCRs), which are community coalitions funded by the Centers for Disease Control and Prevention’s Domestic Violence Prevention Enhancements and Leadership Through Alliances (DELTA) Program, this article reports on improvements in internal capacity and external supports that affect ability to prevent intimate partner violence.
Pamela J. Cox
Daniel M. Finkelstein
Victoria E. Perez
Margo L. Rosenbach
Coordinated Community Response , DELTA Program , Interactive Systems , Framework, Intimate Partner Violence
The Role of Non-state Actors in the Integration of Refugees and Asylum Seekers
http://d.repec.org/n?u=RePEc:oec:cfeaaa:2018/02-en&r=all
Significant variation across and within OECD countries reflects the diverse roles that non-state actors can play in the reception and integration of asylum seekers. This variation can be explained by the differences in the organisation of welfare service delivery, the various national schemes supporting employment and the specific legal frameworks allowing for the labour market access of asylum seekers, along with the inclination of local inhabitants to self-organise to face new challenges. Within the wide spectrum of non-state actors that provide assistance to refugees and asylum seekers, this paper focuses specifically on third sector organisations. Through a survey, it assesses the contribution of these organisations during the refugee crisis in Europe, from 2014 to 2016, in delivering reception and integration policies for refugees, protection holders and asylum seekers and in experimenting with innovative approaches. The paper concludes with a number of policy recommendations on the ways governments leverage the innovative capacity of third sector organisations in providing meaningful and effective initiatives to integrate refugees in the society, labour market and economy of host communities.
Giulia Galera
Leila Giannetto
Antonella Noya
asylum seekers, integration, non-profit organisations, non-state actors, refugees, social enterprises
2018-12-19
The natural rate of interest: estimates, drivers, and challenges to monetary policy JEL Classification: E52, E43
http://d.repec.org/n?u=RePEc:ecb:ecbops:2018217&r=all
Brand, Claus
Bielecki, Marcin
Penalver, Adrian
demographics, monetary policy, natural rate of interest, productivity growth, return on capital
2018-12
Real Time Monitoring of Asset Markets: Bubbles and Crises
http://d.repec.org/n?u=RePEc:cwl:cwldpp:2152&r=all
While each financial crisis has its own characteristics, there is now widespread recognition that crises arising from sources such as financial speculation and excessive credit creation do inflict harm on the real economy. Detecting speculative market conditions and ballooning credit risk in real time is therefore of prime importance in the complex exercises of market surveillance, risk management, and policy action. This chapter provides an R implementation of the popular real-time monitoring strategy proposed by Phillips, Shi and Yu in the International Economic Review (2015), along with a new bootstrap procedure designed to mitigate the potential impact of heteroskedasticity and to effect family-wise size control in recursive testing algorithms. This methodology has been shown effective for bubble and crisis detection and is now widely used by academic researchers, central bank economists, and fiscal regulators. We illustrate the effectiveness of this procedure with applications to the S&P financial market and the European sovereign debt sector using the psymonitor R package developed in conjunction with this chapter.
Peter C.B. Phillips
Shuping Shi
Bubbles, Crises, Real-time detection, Recursive evolving test
2018-11
France
http://d.repec.org/n?u=RePEc:hal:journl:hal-01903593&r=all
Matthieu Lardeau
2018
Colloque Management de la Qualité - Perspectives et prospectives théoriques et pratiques - Actes du colloque
http://d.repec.org/n?u=RePEc:hal:journl:hal-01885055&r=all
Arnaud Eve
2017-12-07
All Over the Map A Worldwide Comparison of Risk Preferences *
http://d.repec.org/n?u=RePEc:hal:journl:halshs-01910201&r=all
We obtain rich measurements of risk preferences for 2939 subjects across 30 countries, and use the data to paint a picture of the distribution of risk preferences across the globe using structural equation models. Reference-dependence and likelihood-dependence are found to be important everywhere. Model parameters in non-Western countries differ systematically from those in Western countries, with poorer countries substantially more risk tolerant than rich countries on average. We qualify previous findings on gender effects and cognitive ability by showing how they mainly impact likelihood-dependence. We further add novel evidence on the correlation between risk preferences and study major. Whereas we confirm previous results on observable characteristics of subjects explaining little of overall preference heterogeneity, a few macroeconomic indicators can explain a considerable part of the between-country heterogeneity.
Olivier L'Haridon
Ferdinand Vieider
risk preferences,cultural comparison,prospect theory
2018
The Empirical Merit of Structural Explanations of Commodity Price Volatility: Review and Perspectives
http://d.repec.org/n?u=RePEc:hal:journl:hal-01924388&r=all
This paper presents both the history of and state‐of‐the‐art in empirical modeling approaches to the world commodity price volatility. The analysis builds on the storage model and key milestones in its development. Specifically, it is intended to offer a reader unfamiliar with the relevant literature an insight into the modeling issues at stake from both a historical and speculative viewpoint. The review considers primarily the empirical techniques designed to assess the merits of the storage theory; it does not address purely statistical approaches that do not rely on storage theory and that have been studied in depth in other streams of the commodity price literature. The paper concludes with some suggestions for future research to try to resolve some of the existing empirical flaws, and hopefully to increase the explanatory power of the storage model.
Nicolas Legrand
empirical validation,storage model,structural econometrics,commodity price dynamics
2018
One-structure-fits-all or how the specific identity of the Permaculture movement fits into the general structure of the networks
http://d.repec.org/n?u=RePEc:hal:journl:halshs-01923833&r=all
Degrowth is the socially sustainable and equitable reduction of society's throughput. A central piece in the degrowth puzzle is attributed to Permaculture. Indeed, many unanswered questions persist concerning Permaculture. This article answers the following research questions: What is the semantic network of the Permaculture movement? What is the hyperlink network of the Permaculture movement? We hypothesize that the semantic network and the hyperlink network will reflect the specificities of Permaculture and we wonder to what extent the semantic network influences the hyperlink network. The results show how the specific identity and semantic network of the Permaculture movement fits into the general structure of the online networks. Hence, one-structure-fits-all seems valid in the context of online social networks.
Claudio Vitari
Christophe David
2018
L'entreprise à mission et ses partenaires
http://d.repec.org/n?u=RePEc:hal:journl:hal-01895375&r=all
Armand Hatchuel
2018
MARKET CONDITIONS AND CHANGE FOR LOW-CARBON ELECTRICITY TRANSITION IN VIETNAM
http://d.repec.org/n?u=RePEc:hal:journl:halshs-01905708&r=all
Hoang Anh Nguyen-Trinh
Yorgos Rizopoulos
2018
Leader gender stereotypes and transformational leadership: Does leader sex make the difference?
http://d.repec.org/n?u=RePEc:hal:journl:hal-01907935&r=all
This research aims to understand how leaders' self-perception of their gender role identity, described as agentic or communal, influences their followers' perception of transformational leadership. Agentic attributes are stereotypically masculine while communal attributes are stereotypically feminine. Drawing on role congruity theory (Eagly & Karau, 2002) and leadership prototype theory (Lord & Maher, 1993), we propose a theoretical model to investigate the influence of leader sex and stereotypical gendered perception of leaders on perceptions of transformational leadership among their followers. Using a sample of 260 employees and their 65 immediate supervisors from French organizations, the results of multilevel structural equation modeling suggest that female leaders who self-describe as highly communal are perceived by followers as more transformational than male leaders. Contrary to our hypothesis, the results reveal an unexpected positive relationship between women's agentic attributes and follower perceptions of transformational leadership. Our findings develop role congruity theory by demonstrating the influence of gendered stereotypes not only for female but also male leaders.
Sarah, E. Saint-Michel
multilevel structural equation modeling,transformational leadership,leader gender,gender role theory,role congruity theory,gender stereotype
2018
A switching self-exciting jump diffusion process for stock prices
http://d.repec.org/n?u=RePEc:hal:journl:halshs-01909772&r=all
This study proposes a new Markov switching process with clustering eects. In this approach, a hidden Markov chain with a nite number of states modulates the parameters of a self-excited jump process combined to a geometric Brownian motion. Each regime corresponds to a particular economic cycle determining the expected return, the diusion coecient and the long-run frequency of clustered jumps. We study rst the theoretical properties of this process and we propose a sequential Monte-Carlo method to lter the hidden state variables. We next develop a Markov Chain Monte-Carlo procedure to t the model to the S&P 500. Finally, we analyse the impact of such a jump clustering on implied volatilities of European options.
Donatien Hainaut
Franck Moraux
switching regime,Hawkes process,self-excited jumps
2018
The power of social media as a labour campaigning tool: lessons from OUR Walmart and the Fight for 15
http://d.repec.org/n?u=RePEc:hal:journl:hal-01903758&r=all
Vincent Pasquier
Alex J Wood
2018
Colloque Ethnographies plurielles #7 : Ethnographies et engagements - Actes du colloque
http://d.repec.org/n?u=RePEc:hal:journl:hal-01885013&r=all
Patrice Cohen
Anne Monjaret
Éric Rémy
Olivier Sirost
2017-11-10
Réactions des managers TI / SI face aux pratiques institutionnalisées
http://d.repec.org/n?u=RePEc:hal:journl:halshs-01924038&r=all
Sofianne Messaoudi Escarabajal
Régis Meissonier
Claudio Vitari
2018
Revealing Stereotypes: Evidence from Immigrants in Schools
http://d.repec.org/n?u=RePEc:nbr:nberwo:25333&r=all
If individuals become aware of their stereotypes, do they change their behavior? We study this question in the context of teachers’ bias in grading immigrants and native children in middle schools. Teachers give lower grades to immigrant students compared to natives who have the same performance on standardized, blindly-graded tests. We then relate differences in grading to teachers’ stereotypes, elicited through an Implicit Association Test (IAT). We find that math teachers with stronger stereotypes give lower grades to immigrants compared to natives with the same performance. Literature teachers do not differentially grade immigrants based on their own stereotypes. Finally, we share teachers’ own IAT score with them, randomizing the timing of disclosure around the date on which they assign term grades. All teachers informed of their stereotypes before term grading increase grades assigned to immigrants. Revealing stereotypes may be a powerful intervention to decrease discrimination, but it may also induce a reaction from individuals who were not acting in a biased way.
Alberto Alesina
Michela Carlana
Eliana La Ferrara
Paolo Pinotti
2018-12
Assimilation Patterns in Cities
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13364&r=all
We develop a model in which ethnic minorities can either assimilate to the majority's norm or reject it by trading off higher productivity and wages with a greater social distance to their culture of origin. We show that "oppositional" minorities reside in more segregated areas, have worse outcomes (in terms of income) but are not necessary worse off in terms of welfare than assimilated minorities who live in less segregated areas. We find that a policy that reduces transportation cost decreases rather than increases assimilation in cities. We also find that when there are more productivity spillovers between the two groups, ethnic minorities are more likely not to assimilate and to reject the majority's norm. Finally, we show that ethnic minorities tend to assimilate more in bigger and more expensive cities.
Sato, Yasuhiro
Zenou, Yves
agglomeration; cities; Ethnic identity; welfare
2018-12
Can Mobile-Linked Bank Accounts Bolster Savings? Evidence from a Randomized Controlled Trial in Sri Lanka
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13378&r=all
In developing economies, mobile-linked services have the potential to significantly reduce transaction costs and provide a truly new conduit that could be used to facilitate the flow of savings into banks. We test this premise by introducing a product that permits Sri Lankan households to deposit mobile airtime balances into a formal bank using a new mobile money interface. Using high frequency panel survey data and randomizing access and prices at the individual level, we find that there are moderate percentage increases in savings deposits with the partner institution and formal banks more generally, but no change in overall savings deposits. When the transaction costs are completely removed, only 26 percent of those offered the service use it, and 7 percent use it frequently. Overall, our results imply that transaction costs may not be a significant barrier to increasing deposits, limiting the potential gains of mobile-linked savings products for financial inclusion.
De Mel, Suresh
Mcintosh, Craig
Sheth, Ketki
Woodruff, Christopher
2018-12
The Benchmark Inclusion Subsidy
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13356&r=all
We study the impact of evaluating the performance of asset managers relative to a benchmark portfolio on firms' investment, merger and IPO decisions. We introduce asset managers into an otherwise standard asset pricing model and show that firms that are part of the benchmark are effectively subsidized by the asset managers. This "benchmark inclusion subsidy" arises because asset managers have incentives to hold some of the equity of firms in the benchmark regardless of the risk characteristics of these firms. Contrary to what is usually taught in corporate finance, we show that the value of an investment project is not governed solely by its own cash-flow risk. Instead, because of the benchmark inclusion subsidy, a firm inside the benchmark would accept some projects that an identical one outside the benchmark would decline. The two types of firms' incentives to undertake mergers or spinoffs also differ and the presence of the subsidy can alter a decision to take a firm public. We show that the higher the cash-flow risk of an investment, the larger the benchmark inclusion subsidy; the subsidy is zero for safe projects. Benchmarking also leads fundamental firm-level cash-flow correlations to rise. We review a host of empirical evidence that is consistent with the implications of the model.
Kashyap, Anil K
Kovrijnykh, Natalia
Li, Jian
Pavlova, Anna
asset management; Benchmark; Index; investment; mergers; Project Valuation
2018-12
What is a Good School, and Can Parents Tell? Evidence on the Multidimensionality of School Output
http://d.repec.org/n?u=RePEc:nbr:nberwo:25342&r=all
Is a school’s impact on high-stakes test scores a good measure of its overall impact on students? Do parents value school impacts on high-stakes tests, longer-run outcomes, or both? To answer the first question, we apply quasi-experimental methods to data from Trinidad and Tobago and estimate the causal impacts of individual schools on several outcomes. Schools' impacts on high-stakes tests are weakly related to impacts on low-stakes tests, dropout, crime, teen motherhood, and formal labor market participation. To answer the second question, we link estimated school impacts to parents’ ranked lists of schools and employ discrete choice models to estimate parental preferences. Parents value schools that causally improve high-stakes test scores conditional on average outcomes, proximity, and peer quality. Consistent with parents valuing the multidimensional output of schools, parents of high-achieving girls prefer schools that increase formal labor market participation, and parents of high-achieving boys prefer schools that reduce crime.
Diether Beuermann
C. Kirabo Jackson
Laia Navarro-Sola
Francisco Pardo
2018-12
What Option Prices tell us about the ECB's Unconventional Monetary Policies
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13371&r=all
We use a series of different approaches to extract information about crash risk from option prices for the Euro-Dollar exchange rate, with each step sharpening the focus on extracting more specific measures of crash risk around dates of ECB measures of Unconventional Monetary Policy. Several messages emerge from the analysis. Announcing policies in general terms without precisely describing what exactly they entail does not move asset markets or actually increases crash risk. Also, policies directly focused on changing relative asset supplies do seem to have an impact, while measures aiming at easing financing costs of commercial banks do not.
de Vette, Nander
Petersen, Annelie
Stan Olijslager, Stan
van Wijnbergen, Sweder
Exchange Rate Crash Risk; mixed diffusion jump risk models; Quantitative easing; risk reversals; unconventional monetary policies
2018-12
Differential Performance in High vs. Low Stakes Tests: Evidence from the GRE Test
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13360&r=all
We study how different demographic groups respond to incentives by comparing their performance in "high" and "low" stakes situations. The high stakes situation is the GRE examination and the low stakes situation is a voluntary experimental section of the GRE. We find that Males exhibit a larger drop in performance between the high and low stakes examinations than females, and Whites exhibit a larger drop in performance compared to minorities. Differences between high and low stakes tests are partly explained by the fact that males and whites exert lower effort in low stakes tests compared to females and minorities.
Attali, Yigal
Neeman, Zvika
Schlosser, Analia
Experiment; Gender Gap; GRE; high stakes; incentives; low stakes; Performance; race gap
2018-12
The Effect of Economic Conditions on the Disability Insurance Program: Evidence from the Great Recession
http://d.repec.org/n?u=RePEc:nbr:nberwo:25338&r=all
We examine the effect of cyclical job displacement during the Great Recession on the Social Security Disability Insurance (SSDI) program. Exploiting variation in the severity and timing of the recession across states, we estimate the effect of unemployment on SSDI applications and awards. We find the Great Recession induced nearly one million SSDI applications that otherwise would not have been filed, of which 41.8 percent were awarded benefits, resulting in over 400,000 new beneficiaries who made up 8.9 percent of all SSDI entrants between 2008-2012. More than one-half of the recession-induced awards were made on appeal. The induced applicants had less severe impairments than the average applicant. Only 9 percent had the most severe, automatically-qualifying impairments, 33 percent had functional impairments and no transferable skills, and the rest were denied for having insufficiently severe impairments and/or transferable skills. Our estimates imply the Great Recession increased claims processing costs by $2.960 billion during 2008-2012, and SSDI benefit obligations by $55.730 billion in present value, or $97.365 billion including both SSDI and Medicare benefits.
Nicole Maestas
Kathleen J. Mullen
Alexander Strand
2018-12
A retrospective on the subprime crisis and its aftermath ten years after Lehman's collapse
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13373&r=all
This paper reviews the interactions between policymaking, the financial system and the U.S. economy before, during and after the subprime crisis with particular attention to current controversies about the policy decisions that led to Lehman's downfall and their lessons for the future. The first part of the paper documents and analyzes the interactions between policy, financial markets and the economy during the acute and subsequent moderate phases of the crisis as well as during the later gradual exit from the zero lower bound and the extremely slow reduction in high powered money and bank reserves. The remaining parts develop alternative aspects of the thesis that mutual uncertainties inflicted by financial institutions on policymakers and by the latter on financial markets were at the root of the non-negligible surprises that the crisis inflicted on everybody. In particular, it discusses the political economy of bailout operations, reviews and evaluates recent controversies about the reasons for not rescuing Lehman Brothers and present informally the structure and policy lessons from a general equilibrium model of the financial sector which highlights the consequences of policy actions that have raised (Knightian) bailout uncertainty. The last section takes a brief look ahead and discusses some longer term consequences of the crisis.
Cukierman, Alex
bailouts; banks' reserves; credit; exit; financial crisis; monetary policy; uncertainty
2018-12
The Benchmark Inclusion Subsidy
http://d.repec.org/n?u=RePEc:nbr:nberwo:25337&r=all
We study the impact of evaluating the performance of asset managers relative to a benchmark portfolio on firms’ investment, merger and IPO decisions. We introduce asset managers into an otherwise standard asset pricing model and show that firms that are part of the benchmark are effectively subsidized by the asset managers. This “benchmark inclusion subsidy” arises because asset managers have incentives to hold some of the equity of firms in the benchmark regardless of the risk characteristics of these firms. Contrary to what is usually taught in corporate finance, we show that the value of an investment project is not governed solely by its own cash-flow risk. Instead, because of the benchmark inclusion subsidy, a firm inside the benchmark would accept some projects that an identical one outside the benchmark would decline. The two types of firms’ incentives to undertake mergers or spinoffs also differ and the presence of the subsidy can alter a decision to take a firm public. We show that the higher the cash-flow risk of an investment, the larger the benchmark inclusion subsidy; the subsidy is zero for safe projects. Benchmarking also leads fundamental firm-level cash-flow correlations to rise. We review a host of empirical evidence that is consistent with the implications of the model.
Anil K. Kashyap
Natalia Kovrijnykh
Jian Li
Anna Pavlova
2018-12
Venting Out: Exports During a Domestic Slump
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13380&r=all
We exploit plausibly exogenous geographical variation in the reduction in domestic demand caused by the Great Recession in Spain to document the existence of a robust, within-firm negative causal relationship between demand-driven changes in domestic sales and export flows. Spanish manufacturing firms whose domestic sales were reduced by more during the crisis observed a larger increase in their export flows, even after controlling for firms' supply determinants (such as labor costs). This negative relationship between demand-driven changes in domestic sales and changes in export flows illustrates the capacity of export markets to counteract the negative impact of local demand shocks. We rationalize our findings through a standard heterogeneous-firm model of exporting expanded to allow for non-constant marginal costs of production. Using a structurally estimated version of this model, we conclude that the firm-level responses to the slump in domestic demand in Spain could well have accounted for around one-half of the spectacular increase in Spanish goods exports (the so-called `Spanish export miracle') over the period 2009-13.
Almunia, Miguel
Antràs, Pol
Lopez-Rodriguez, David
Morales, Eduardo
2018-12
Economic history and contemporary challenges to globalization
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13377&r=all
The paper surveys three economic history literatures that can speak to contemporary challenges to globalization: the literature on the anti-globalization backlash of the nineteenth century, focused largely on trade and migration; the literature on the Great Depression, focused largely on capital flows, the gold standard, and protectionism; and the literature on trade and warfare.
O'Rourke, Kevin Hjortshøj
deglobalization; Globalization
2018-12
The Intergenerational Behavioural Consequences of a Socio-Political Upheaval
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13354&r=all
Social scientists have long been interested in the effects of social-political upheavals on a society subsequently. A priori, we would expect that, when traumas are brought about by outsiders, within-group behaviour would become more collaborative, as society unites against the common foe. Conversely, we would expect the reverse when the conflict is generated within-group. In our paper we are looking at this second form of upheaval, and our measure of within-group conflict is the 1966-1976 Cultural Revolution (CR) that seriously disrupted many aspects of Chinese society. In particular, we explore how individuals' behavioural preferences are affected by within-group traumatic events experienced by their parents or grandparents. Using data from a laboratory experiment in conjunction with survey data, we find that individuals with parents or grandparents affected by the CR are less trusting, less trustworthy, and less likely to choose to compete than their counterparts whose predecessors were not direct victims of the CR.
Booth, Alison L
Fan, Elliott
Meng, Xin
Zhang, Dandan
behavioural economics; Cultural Revolution; preferences
2018-12
Media Sentiment and International Asset Prices
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13366&r=all
This paper assesses the impact of media sentiment on international equity prices using a dataset of more than 4.5 million Reuters articles published across the globe between 1991 and 2015. Media sentiment robustly predicts daily returns in both advanced and emerging markets, even after controlling for known determinants of stock prices. But not all news sentiment is alike. A local (country-specific) increase in news optimism (pessimism) predicts a small and transitory increase (decrease) in local returns. By contrast, changes in global news sentiment have a larger impact on equity returns around the world, which does not reverse in the short run. Media sentiment affects mainly foreign - rather than local - investors: although local news optimism attracts international equity flows for a few days, global news optimism generates a permanent foreign equity inflow. Our results confirm the value of media content in capturing investor sentiment.
Fraiberger, Samuel
Lee, Do
Puy, Damien
Rancière, Romain
Asset Pricing; behavioral finance; Capital Flows; Investor Sentiment; Natural Language Processing; news media
2018-12
Trade and Credit Reallocation: How Banks Help Shape Comparative Advantage
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13375&r=all
Trade and innovation cause structural change. Productive factors must flow from declining to growing industries. Banks play a major role in cutting credit to non-viable firms in downsizing sectors and in providing new credit to finance investment in expanding, innovative sectors. Structural parameters of a country's banking system thus influence comparative advantage and trade, and can magnify the gains from trade liberalization. The analysis shows how insolvency laws, minimum capital standards, and cost of bank equity determine credit reallocation, sectoral expansion and trade patterns.
Keuschnigg, Christian
Kogler, Michael
Banking; capital reallocation; comparative advantage; Trade
2018-12
Who’s Minding the Kids? Experimental Evidence on the Demand for Child Care Quality
http://d.repec.org/n?u=RePEc:nbr:nberwo:25335&r=all
Despite the well-documented benefits of high-quality child care, many preschool-age children in the U.S. attend low-quality programs. Accordingly, improving the quality of child care is increasingly an explicit goal of government policy. However, accomplishing this goal requires a thorough understanding of the factors that influence parents’ child care decisions. This paper provides the first credible evidence on the demand for child care characteristics in the market for home-based care. Using a randomized audit design, we study three dimensions of caregiving: affordability (i.e., the hourly price of child care), quality (i.e., caregiver education and experience), and convenience (i.e., caregiver car ownership and availability). We find that while parents are extremely sensitive to the cost of child care, they also have strong preferences for quality, particularly caregivers’ educational attainment. Furthermore, we obtain mixed results on the convenience dimensions of child care, with parents valuing those owning a car but not those with more availability. Finally, we find significant heterogeneity in child care preferences according to families’ age of youngest child, race and ethnicity, and willingness-to-pay. Our findings suggest that the child care market’s quality problems may be driven by parents’ inability to afford high-quality care or their lack of informational resources on how to identify such programs, rather than an unwillingness to pay for them.
James Gordon
Chris M. Herbst
Erdal Tekin
2018-12
Decompositions and Policy Consequences of an Extraordinary Decline in Air Pollution from Electricity Generation
http://d.repec.org/n?u=RePEc:nbr:nberwo:25339&r=all
We determine the change in air pollution damages from U.S. power plant emissions over 2010 to 2017. Annual damages fell from $245 billion to $133 billion over this period, with most of the decline occurring in the East. Decomposition shows that changes in emissions rates reduced damages by $63 billion, changes in generation shares reduced damages by $60 billion, and a reduction in fossil generation reduced damages by $25 billion. However, changes in damage valuations per ton of emissions increased damages by $35 billion. We estimate that marginal damages declined in the East from about 9¢ per kWh in 2010 to 6¢ in 2017. This decrease is slower than the decrease in total damages. Despite little or no change in total damages in the West and Texas, marginal damages increased. The environmental benefit of electric vehicles increased so that they are now cleaner than gasoline vehicles on average, though substantial heterogeneity remains. The environmental benefit of solar panels decreased in the East but increased elsewhere.
Stephen P. Holland
Erin T. Mansur
Nicholas Muller
Andrew J. Yates
2018-12
The Microeconomic foundations of Aggregate Production Functions
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13362&r=all
Aggregate production functions are reduced-form relationships that emerge endogenously from input-output interactions between heterogeneous producers and factors in general equilibrium. We provide a general methodology for analyzing such aggregate production functions by deriving their first- and second-order properties. Our aggregation formulas provide non-parameteric characterizations of the macro-elasticities of substitution between factors and of the macro bias of technical change in terms of micro sufficient statistics. They allow us to generalize existing aggregation theorems and to derive new ones. We relate our results to the famous Cambridge-Cambridge controversy.
Baqaee, David Rezza
Farhi, Emmanuel
2018-12
Can Mobile-Linked Bank Accounts Bolster Savings? Evidence from a Randomized Controlled Trial in Sri Lanka
http://d.repec.org/n?u=RePEc:nbr:nberwo:25354&r=all
In developing economies, mobile-linked services have the potential to significantly reduce transaction costs and provide a truly new conduit that could be used to facilitate the flow of savings into banks. We test this premise by introducing a product that permits Sri Lankan households to deposit mobile airtime balances into a formal bank using a new mobile money interface. Using high frequency panel survey data and randomizing access and prices at the individual level, we find that there are moderate percentage increases in savings deposits with the partner institution and formal banks more generally, but no change in overall savings deposits. When the transaction costs are completely removed, only 26 percent of those offered the service use it, and 7 percent use it frequently. Overall, our results imply that transaction costs may not be a significant barrier to increasing deposits, limiting the potential gains of mobile-linked savings products for financial inclusion.
Suresh De Mel
Craig McIntosh
Ketki Sheth
Christopher Woodruff
2018-12
Structural Transformation, Industrial Specialization, and Endogenous Growth
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13379&r=all
The introduction of new technologies in agriculture can foster structural transformation by freeing workers who find occupation in other sectors. The traditional view is that this increase in labor supply in manufacturing can lead to industrial development. However, when workers moving to manufacturing are mostly unskilled, this process reinforces a country's comparative advantage in low-skill intensive industries. To the extent that these industries undertake less R&D, this change in industrial composition can lead to lower long-run growth. We provide empirical evidence of this mechanism using a large and exogenous increase in agricultural productivity due to the legalization of genetically engineered soy in Brazil. Our results indicate that improvements in agricultural productivity, while positive in the short-run, can generate specialization in less-innovative industries and have negative effects on productivity in the long-run.
Bustos, Paula
Castro Vincenzi, Juan Manuel
Monras, Joan
Ponticelli, Jacopo
Agricultural Productivity; Brazil; Genetically Engineered Soy; labor mobility; Skill-Biased Technical Change
2018-12
Animal Spirits and Fiscal Policy
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13376&r=all
We extend the behavioral macroeconomic model proposed by De Grauwe (2011) by including fiscal policy. In this model, agents have limited cognitive capabilities and use simple heuristics to forecast output and inflation. However, thanks to a learning mechanism, agents can revise their forecasting rule according to its performance. This feature produces endogenous and self-fulfilling waves of optimism and pessimism (animal spirits). This framework allows us to show that the short-run spending multiplier is state-dependent. The multiplier is stronger under either extreme optimism or pessimism and reduces in periods of tranquility. Furthermore, the more the central bank focuses on output stabilization, the smaller the multiplier. We also show that periods of increasing public debt are characterized by intense pessimism, while intense optimism occurs in periods of decreasing debt. This allows us to show that governments face a trade-off between the stabilization of the output gap and the stabilization of public debt. We also evaluate our model at the zero lower bound and find that the lower the inflation target, the more likely the system can be gripped in a deflationary spiral that is dynamically unstable and characterized by chronic pessimism and exploding public debt.
De Grauwe, Paul
Foresti, Pasquale
2018-12
The Costs and Benefits of Shareholder Democracy
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13358&r=all
We show that while low-cost shareholder activism via shareholder-sponsored proposals is occasionally value-enhancing, many proposals are submitted by the same few individual investors and other sponsors without organizational capabilities to analyze a large number of firms. These proposals if approved and subsequently implemented appear to destroy shareholder value. We show that firms whose shareholders are more likely to collect information before voting benefit from low-cost shareholder activism because these investors weed out low-quality proposals. We conclude that an informed shareholder base is crucial for firms to take advantage of low-cost shareholder activism.
Gantchev, Nickolay
Giannetti, Mariassunta
corporate governance; Shareholder activism; Shareholder proposals; shareholder voting
2018-12
Identity Politics and Trade Policy
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13367&r=all
We characterize trade policies that result from political competition when assessments of well-being include both material and psychosocial components. The material component reflects, as usual, satisfaction from consumption. Borrowing from social identity theory, we take the psychosocial component as combining the pride and self-esteem an individual draws from the status of groups with which she identifies and a dissonance cost she bears from identifying with those that are different from herself. In this framework, changes in social identification patterns that may result, for example, from increased income inequality or heightened racial and ethnic tensions, lead to pronounced changes in trade policy. We analyze the nature of these policy changes.
Grossman, Gene
Helpman, Elhanan
political economy; populism; protectionism; social identity; tariff formation
2018-12
The neutrality illusion: biased economics, biased training, and biased monetary policy. Testing the role of ideology on FOMC voting behaviour
http://d.repec.org/n?u=RePEc:ehl:lserod:83172&r=all
This research is trying to shed light on two myths that are usually widespread: the first one being the idea of the academic economist as a neutral scientist finding uncontestable consensual truths, thanks to uncontestable empirical methods, the second, the idea of the central banker as a Weberian neutral bureaucrat setting aside personal beliefs to act mechanically for the common good. Deconstructing this ‘neutrality illusion’, this work argues that economics is actually a divided and ideologically marked discipline despite its aim at natural-science-type-legitimacy. It argues in a related discussion that such ideological bias also impedes a purely neutral conduct of monetary policy, undermining the very idea of central bank independence. Linking these two arguments, it argues that graduate training in economics is the first place for the formation of biased preferences, because of the substantial ideological sorting that exists across universities. Using a unique database on FOMC members’ votes and ideology, the paper tests this idea empirically and despite unavoidable caveats, finds robust evidence of a systematic impact of the ideological features of their alma mater on FOMC members’ voting behaviour – impact that we found more important than the other traditional determinants of central bankers’ actions.
Lepers, Etienne
Fed; monetary policy; FOMC; central bank independence; dissent; ideological bias; educational training; freshwater; saltwater; economics science
2017-06-07
A Review of Shadow Banking
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13363&r=all
Traditional financial intermediaries are centralized entities brokering the flow of funds between households and borrowers. Households could certainly bypass intermediaries and directly invest in equity or debt of borrowers. However, direct finance requires dealing with well-known informational and liquidity frictions. In particular, it is usually costly to screen, select, monitor, and diversify across investment projects. Moreover, direct investments may be constrained by the need by households for liquidity: that is, the need to access funds before the investments comes to fruition, resulting in wasteful liquidation costs. Financial intermediaries exist to minimize on all of these costs. In the traditional model, intermediaries are centralized agents performing under one roof multiple roles of screening, selection, monitoring, and diversification of risk, while simultaneously providing liquidity services to the providers of funds. The simultaneous provision of these services to multiple agents through maturity, liquidity, and credit transformation provides for a better allocation of risk between households and firms. While financial intermediation facilitates more efficient risk sharing between borrowers and the suppliers of funds, it does create new risks, the most relevant one being the well-known exposure to "runs" and premature liquidation of projects when the suppliers of funds pull out en masse. Hence, financial intermediation activity is intrinsically fragile, and most importantly it carries a significant social externality, represented by the risk of systemic disruptions in the case of contagion of run events. The official sector has attempted to minimize this systemic risk through the use of its own balance sheet, by providing credit guarantees on the liabilities of these intermediaries as well as by providing contingent liquidity to these institutions from the lender of last resort. However, the risk-insensitive provision of credit guarantees and liquidity backstops creates well-known incentives for excessive risk-taking, leverage, and maturity transformation, motivating the need for enhanced supervision and prudential regulation. This traditional form of financial intermediation, with credit being intermediated through banks and insurance companies, but with the public sector standing close by to prevent destabilizing runs, dominated other forms of financial intermediation from the Great Depression well into the 1990s. Over time, financial innovation has transformed intermediation from a process involving a single financial institution to a process now broken down among several institutions, each with their own role in manufacturing the intermediation of credit. With specialization has come significant reductions in the cost of intermediation, but the motive to reduce costs has also pushed financial activity into the shadows in order to reduce or eliminate the cost associated with prudential supervision and regulation, investor disclosure, and taxes. Over the course of three decades, the shadow banking system quickly grew to become equal in size to that of the traditional system, improving on the terms of liquidity traditionally offered to households and borrowers. However, it was only a matter of time before intermediation designed to evade public sector oversight would end badly, as occurred during the post-2007-08 credit cycle. Consequently, while financial innovation is naturally associated with the more efficient provision of financial services, it is this dark side of non-traditional intermediation that has come to define shadow banking.
Adrian, Tobias
Ashcraft, Adam
Breuer, Peter
Cetorelli, Nicola
2018-12
Pigouvian Cycles
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13370&r=all
Low-frequency variations in current and expected unemployment rates are important to identify TFP news shocks and to allow a general equilibrium rational expectations model to generate Pigouvian cycles: a large fraction of the comovement of output, consumption, investment, employment, and real wages is explained by changes in expectations unrelated to TFP fundamentals. The model predicts that the start (end) of most U.S. recessions is associated with agents realizing that previous enthusiastic (lukewarm) expectations about future TFP would not be met.
Faccini, Renato
Melosi, Leonardo
2018-12
High Tech and Venture Capital Inflows: The case of Israel
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13361&r=all
Large capital inflows are understandably viewed as dangerous in emerging markets living with memories of recent currency crises: in Israel foreign capital provided crucial funding for investment in the country's showcase technology sector. Israel is now solidly established as a high-tech powerhouse-a place where budding venture capitalists from emerging market countries flock to learn how to develop an innovation ecosystem. However, the domestic market alone is far too small and homegrown capital formation insufficient to foster that innovation. Globalization has been essential. The paper reviews the crucial role which globalization forces played Israel's transformation from low tech to high tech economy. Special emphasis is placed on foreign direct investment as a driver for the high-tech transformation.
Razin, Assaf
high tech sector; productivity; venture capital
2018-12
Economic Uncertainty and Fertility Cycles: The Case of the Post-WWII Baby Boom
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13374&r=all
Using the US Census waves 1940-1990 and Current Population Surveys 1990-2010, we look at how economic uncertainty affected fertility cycles over the course of the XXth century. We use cross-state and cross-cohort variation in the volatility of income growth to identify the causal link running from uncertainty to completed fertility. We find that economic uncertainty has a large and robust negative effect on fertility. This finding contributes to the unraveling of the determinants of the post-WWII baby boom. Specifically, the difference in economic uncertainty endured by women born in 1910 compared to that faced by women born in 1935 accounts for between 45% and 61% of the one child variation across these cohorts. We hypothesize that a greater economic uncertainty increases the risk of large consumption swings, which individuals mitigate by marrying later, postponing fertility, and ultimately decreasing their completed fertility.
Chabé-Ferret, Bastien
Gobbi, Paula
baby boom; baby bust; economic uncertainty; Fertility
2018-12
Closing the Gap: The Effect of a Targeted, Tuition-Free Promise on College Choices of High-Achieving, Low-Income Students
http://d.repec.org/n?u=RePEc:nbr:nberwo:25349&r=all
Low-income students, even those with strong academic credentials, are unlikely to attend a highly selective college. With a field experiment, we test an intervention to increase enrollment of low-income students at the highly selective University of Michigan. We contact students (as well as their parents and principals) with an encouragement to apply and a promise of four years of free tuition and fees upon admission. Materials emphasize that this offer is not contingent on completing aid applications (e.g., the FAFSA or PROFILE). Treated students were more than twice as likely to apply to (67 percent vs. 26 percent) and enroll at (27 percent vs. 12 percent) the University of Michigan. There was no diversion from schools as (or more) selective as UM. The enrollment effect of 15 percentage points (pp) comprises students who would otherwise attend a less selective, four-year college (7 pp), a community college (4 pp), or no college (4 pp). Effects persist through two years of follow-up. The intervention closed by half the income gaps in college choice among Michigan's high-achieving students. We conclude that an encouragement to apply, paired with a promise of aid, when communicated to students and influential adults, can substantially close income gaps in college choices.
Susan Dynarski
C.J. Libassi
Katherine Michelmore
Stephanie Owen
2018-12
Optimal Healthcare Contracts: Theory and Empirical Evidence from Italy
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13357&r=all
In this paper we investigate the nature of the contracts between a large health-care purchaser and health service providers in a prospective payment system. We model theoretically the interaction between patients choice and cream-skimming by hospitals. We test the model using a very large and detailed administrative dataset for the largest region in Italy. In line with our theoretical results, we show that the state funded purchaser offers providers a system of incentives such that the most efficient providers both treat more patients and also treat more difficult patients, thus receiving a higher average payment per treatment.
Berta, Paolo
De Fraja, Gianni
Verzillo, Stefano
Cream skimming; Hospitals; Lombardy; Optimal healthcare contracts; Patients choice
2018-12
Measuring Ethnic Stratification and its Effect on Trust in Africa
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13368&r=all
We define and axiomatically characterize an index of ethnic stratification that measures the extent to which the hierarchy in socio-economic positions across the individuals of a society follows ethnolinguistic lines. This index generalizes the idea of between-group inequality to situations where data on economic and ethnolinguistic distances between pairs of individuals is available. We define an estimator of our index that takes the form of a second order U-statistic and has well-behaved statistical properties, and we show that ethnic stratification is empirically related to low levels of trust in other people and institutions at the local level in Africa.
Hodler, Roland
Srisuma, Sorawoot
Vesperoni, Alberto
Zurlinden, Noemie
ethnic diversity; ethnic fractionalization; inequality; Trust
2018-12
Two Hundred Years of Health and Medical Care: The Importance of Medical Care for Life Expectancy Gains
http://d.repec.org/n?u=RePEc:nbr:nberwo:25330&r=all
Using two hundred years of national and Massachusetts data on medical care and health, we examine how central medical care is to life expectancy gains. While common theories about medical care cost growth stress growing demand, our analysis highlights the importance of supply side factors, including the major public investments in research, workforce training and hospital construction that fueled a surge in spending over the 1955-1975 span. There is a stronger case that personal medicine affected health in the second half of the twentieth century than in the preceding 150 years. Finally, we consider whether medical care productivity decreases over time, and find that spending increased faster than life expectancy, although the ratio stabilized in the past two decades.
Maryaline Catillon
David Cutler
Thomas Getzen
2018-12
Firm Leverage and Regional Business Cycles
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13355&r=all
This paper shows that buildups in firm leverage predict subsequent declines in aggregate regional employment. Using confidential establishment-level data from the U.S. Census Bureau, we exploit regional heterogeneity in leverage buildups by large U.S. publicly listed firms, which are widely spread across U.S. regions. For a given region, our results show that increases in firms' borrowing are associated with "boom-bust" cycles: employment grows in the short run but declines in the medium run. Across regions, our results imply that regions with larger buildups in firm leverage exhibit stronger short-run growth, but also stronger medium-run declines, in aggregate regional employment. We obtain similar results if we condition on national recessions-regions with larger buildups in firm leverage prior to a recession experience larger employment losses during the recession. When comparing regional firm and household leverage growth, we find qualitatively similar patterns for both. Finally, we find that regions whose firm leverage growth comoves more strongly also exhibit stronger comovement in their regional business cycles.
Giroud, Xavier
Mueller, Holger M
Business Cycles; Firm leverage
2018-12
Beyond Okun's Law: Output Growth and Labor Market Flows
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13369&r=all
This paper studies the relationship between the change in the unemployment rate and output growth using an approach based on labor market flows. The framework shows why the Okun coefficient may be constant/time-varying and/or symmetric/asymmetric and that the outcome lies with the behavior of the labor flows in response to growth. The encompassing framework nests the conditions to determine the properties of the Okun coefficient without the need to rely on retrospective arbitrary dating of recessions. The framework also highlights the potential misspecification in conventional models of Okun's Law unless stringent conditions are assumed about the behavior of labor flows. The empirical analysis is based on the stock-consistent labor market flows data developed by the BLS for the period 1990:2-2017:3.
Dixon, Robert
Lim, Guay C.
van Ours, Jan C.
Asymmetry; Labor flows; Time-varying Okun
2018-12
Money Markets and Exchange Rates in Pre-Industrial Europe
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13372&r=all
This article focuses on money markets and exchange rates in preindustrial Europe. The foreign exchange market was mostly based on bills of exchange, the instrument used to transfer money and provide credit between distant centers in pre-industrial Europe. In this chapter, first I explain bill of exchange operations, money market integration, usury regulations and circumventions to hide the market interest rate as well as the evolution of bills of exchange in history, focusing mainly on the most relevant features generalized during the first half of the 17th century: endorsement and the joint liability rule, which facilitated the full expansion of the foreign exchange market beyond personal networks. Then, I describe the European geography of money in the mid-18th century, characterized by a very high degree of multilateralism with the triangle of Amsterdam, London and Paris as the backbone of the European settlement system. Finally, I measure the cost of capital and relate it to liquidity. I show evidence of interest rates in the 18th century for Amsterdam, London, Paris and Cadiz. While Amsterdam, London and Paris presented low and similar interest rates, Cadiz had higher interest rates, mostly being double the cost of capital. These results seem to show a high inverse correlation between liquidity and interest rates, suggesting that the share in international trade of European centers might have been a powerful driver of international monetary leadership. While more empirical evidence and further research is needed, this approach opens the scope of the analysis beyond the national institutional explanation.
Nogues-Marco, Pilar
Bills of Exchange; cost of capital; Exchange Rates; interest rates; monetary geography; money market; Specie-Point Mechanism; usury regulations
2018-12
Media Sentiment and International Asset Prices
http://d.repec.org/n?u=RePEc:nbr:nberwo:25353&r=all
This paper assesses the impact of media sentiment on international equity prices using a dataset of more than 4.5 million Reuters articles published across the globe between 1991 and 2015. Media sentiment robustly predicts daily returns in both advanced and emerging markets, even after controlling for known determinants of stock prices. But not all news sentiment is alike. A local (country-specific) increase in news optimism (pessimism) predicts a small and transitory increase (decrease) in local returns. By contrast, changes in global news sentiment have a larger impact on equity returns around the world, which does not reverse in the short run. Media sentiment affects mainly foreign – rather than local – investors: although local news optimism attracts international equity flows for a few days, global news optimism generates a permanent foreign equity inflow. Our results confirm the value of media content in capturing investor sentiment.
Samuel P. Fraiberger
Do Lee
Damien Puy
Romain Rancière
2018-12
Hall of Mirrors: Corporate Philanthropy and Strategic Advocacy
http://d.repec.org/n?u=RePEc:nbr:nberwo:25329&r=all
Politicians and regulators rely on feedback from the public when setting policies. For-profit corporations and non-pro t entities are active in this process and are arguably expected to provide independent viewpoints. Policymakers (and the public at large), however, may be unaware of the financial ties between some firms and non-profits - ties that are legal and tax-exempt, but difficult to trace. We identify these ties using IRS forms submitted by the charitable arms of large U.S. corporations, which list all grants awarded to non-pro fits. We document three patterns in a comprehensive sample of public commentary made by firms and non-profits within U.S. federal rulemaking between 2003 and 2015. First, we show that, shortly after a firm donates to a non-profit, the grantee is more likely to comment on rules for which the firm has also provided a comment. Second, when a firm comments on a rule, the comments by non-profits that recently received grants from the firm's foundation are systematically closer in content similarity to the firm's own comments than to those submitted by other non-profits commenting on that rule. This content similarity does not result from similarly-worded comments that express divergent sentiment. Third, when a firm comments on a new rule, the discussion of the final rule is more similar to the firm's comments when the firm's recent grantees also comment on that rule. These patterns, taken together, suggest that corporations strategically deploy charitable grants to induce non-pro fit grantees to make comments that favor their benefactors, and that this translates into regulatory discussion that is closer to the firm's own comments.
Marianne Bertrand
Matilde Bombardini
Raymond Fisman
Bradley Hackinen
Francesco Trebbi
2018-12
Conditional dynamics and the multi-horizon risk-return trade-off
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13365&r=all
We propose testing asset-pricing models using multi-horizon returns (MHR). MHR serve as powerful source of conditional information that is economically important and not data-mined. We apply MHR-based testing to linear factor models. These models seek to construct the unconditionally mean-variance efficient portfolio. We reject all state-of-the-art models that imply high maximum Sharpe ratios in a single-horizon setting. Thus, the models do a poor job in accounting for the risk-return trade-off at longer horizons. Across the different models, the mean absolute pricing errors associated with MHR are positively related to the magnitude of maximal Sharpe ratio in the single-horizon setting. Model misspecification manifests itself in strong intertemporal dynamics of the factor loadings in the SDF representation. We suggest that misspecification of the dynamics of loadings arises from the common approach towards factor construction via portfolio sorts.
Chernov, Mikhail
Lochstoer, Lars
Lundeby, Stig
linear factor models; multi-horizon returns; Stochastic discount factor
2018-12
Definition Matters: Metropolitan Areas and Agglomeration Economies in a Large Developing Country
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13359&r=all
A variety of approaches to delineate metropolitan areas have been developed. Systematic comparisons of these approaches in terms of the urban landscape that they generate are however few. This paper aims to fill this gap. The paper focuses on Indonesia and makes use of the availability of data on commuting flows, remotely-sensed nighttime lights, and spatially fine-grained population, to construct metropolitan areas using the different approaches that have been developed in the literature. The analysis finds that the maps and characteristics of Indonesia's urban landscape vary substantially, depending on the approach used. Moreover, combining information on the metro areas generated by the different approaches with detailed micro-data from Indonesia's national labor force survey, the paper shows that the estimated size of the agglomeration wage premium depends nontrivially on the approach used to define metropolitan areas.
Bosker, Maarten
Park, Jane
Roberts, Mark
agglomeration economies; Indonesia; metro areas; urban definitions
2018-12
Quantifying the Benefits of Labor Mobility in a Currency Union
http://d.repec.org/n?u=RePEc:nbr:nberwo:25347&r=all
Unemployment differentials are bigger in Europe than in the United States. Migration responds to unemployment differentials, though the response is smaller in Europe. Mundell (1961) argued that factor mobility is a precondition for a successful currency union. We use a multi-country DSGE model with cross-border migration and search frictions to quantify the benefits of increased labor mobility in Europe and compare this outcome to a case of fully flexible exchange rates. Labor mobility and flexible exchange rates both work to reduce unemployment and per capita GDP differentials across countries provided that monetary policy is sufficiently responsive to national output.
Christopher L. House
Christian Proebsting
Linda L. Tesar
2018-12
Firm R&D investment and export market exposure
http://d.repec.org/n?u=RePEc:zbw:zewdip:18047&r=all
In this article we study differences in the returns to R&D investment between firms that sell in international markets and firms that only sell in the domestic market. We use German firm-level data from the high-tech manufacturing sector to estimate a dynamic structural model of a firm's decision to invest in R&D and use it to measure the difference in expected long-run benefit from R&D investment for exporting and domestic firms. The results show that R&D investment leads to a higher rate of product and process innovation among exporting firms and these innovations have a larger impact on productivity improvement in export market sales. As a result, exporting firms have a higher payoff from R&D investment, invest in R&D more frequently than firms that only sell in the domestic market, and, subsequently, have higher rates of productivity growth. The endogenous investment in R&D is an important mechanism that leads to a divergence in the long-run performance of firms that differ in their export market exposure. Simulating the introduction of trade tariffs we find a substantial reduction in firms' productivity growth and incentive to invest in R&D.
Peters, Bettina
Roberts, Mark J.
Vuong, Van Anh
R&D choice,Export,Innovation,Productivity,Dynamic structural model
2018
Bounds on Average and Quantile Treatment Effects on Duration Outcomes under Censoring, Selection, and Noncompliance
http://d.repec.org/n?u=RePEc:zbw:glodps:288&r=all
We consider the problem of assessing the effects of a treatment on duration outcomes using data from a randomized evaluation with noncompliance. For such settings, we derive nonparametric sharp bounds for average and quantile treatment effects addressing three pervasive problems simultaneously: self-selection into the spell of interest, endogenous censoring of the duration outcome, and noncompliance with the assigned treatment. Ignoring any of these issues could yield biased estimates of the effects. Notably, the proposed bounds do not impose the independent censoring assumption|which is commonly used to address censoring but is likely to fail in important settings|or exclusion restrictions to address endogeneity of censoring and selection. Instead, they employ monotonicity and stochastic dominance assumptions. To illustrate the use of these bounds we assess the effects of the Job Corps (JC) training program on its participants' last complete employment spell duration. Our estimated bounds suggest that JC participation may increase the average duration of the last complete employment spell before week 208 after randomization by at least 5.6 log points (5.8 percent) for individuals who comply with their treatment assignment and experience a complete employment spell whether or not they enrolled in JC. The estimated quantile treatment effects suggest the impacts may be heterogeneous, and strengthen our conclusions based on the estimated average effects.
Blanco, German
Chen, Xuan
Flores, Carlos A.
Flores-Lagunes, Alfonso
Duration Outcomes,Principal Stratification,Partial Identification,Independent Censoring
2018
Essays in economics of education and econometric theory
http://d.repec.org/n?u=RePEc:tiu:tiutis:df993490-b694-4b76-bde5-6945f8d788f8&r=all
This doctoral thesis is composed of three chapters on economics of education and econometric theory. Chapter 2 studies how students interact in teams and gives some guidance to educators how to group students to increase their academic knowledge obtained from teamwork. Chapter 3 provides some initial analysis which will be used in future research to investigate whether teachers' subjective assessments are driven by superior information about pupils or by their biases and mistaken beliefs. It is important to disentangle these two forms of teacher discretion, because they have different policy implications. If teacher discretion stems from their biases or mistaken beliefs, educational institutions may want to minimize the reliance on teachers' assessments. On the other hand, if teachers take into account abilities not captured by the standardized test, educational institutions may prefer to give more weight to their assessments. Chapter 3 proposes a new estimator for spatial sample selection models.
Rabovic, Renata
2018
Home ownership and monetary policy transmission
http://d.repec.org/n?u=RePEc:zbw:cfswop:615&r=all
We present empirical evidence on the heterogeneity in monetary policy transmission across countries with different home ownership rates. We use household-level data together with shocks to the policy rate identified from high-frequency data. We find that housing tenure reacts more strongly to unexpected changes in the policy rate in Germany and Switzerland - the OECD countries with the lowest home ownership rates - compared with existing evidence for the U.S. An unexpected decrease in the policy rate by 25 basis points increases the home ownership rate by 0.8 percentage points in Germany and by 0.6 percentage points in Switzerland. The response of non-housing consumption in Switzerland is less heterogeneous across renters and mortgagors, and has a different pattern across age groups than in the U.S. We discuss economic explanations for these findings and implications for monetary policy.
Koeniger, Winfried
Ramelet, Marc-Antoine
Monetary policy transmission,Home ownership,Housing tenure,Consumption
2018
The long-run impact of historical shocks on the decision to migrate: Evidence from the Irish Migration.
http://d.repec.org/n?u=RePEc:zbw:esprep:187690&r=all
This study investigates how negative historical shocks can explain migration in the long-run. We construct a unique dataset based on the early 20th century Irish Census data and a selection of the Ellis Island Administrative Records which allow us to test whether the Great Irish Famine (1845-1850), one of the most lethal starvation in history, has shaped the decision of migrating to the USA in the following 70 years. We control for several set of individual and geographical characteristics and we find that the Irish Famine was an important significant driver of individuals’ migration choices. Instrumental variable analysis based on the exogenous spread of the potato blight provides consistent results.
Narciso, Gaia
Severgnini, Battista
Vardanyan, Gayane
Mass migration,negative shock,long-run impact,Great Famine
2018
Path dependencies versus efficiencies in regulation: Evidence from "old" and "new" broadband markets in the EU
http://d.repec.org/n?u=RePEc:zbw:zewdip:18051&r=all
This paper examines the determinants of sector-specific regulation imposed on broadband markets related both to efficiency objectives of regulators and to those of narrowly defined interest groups. We test hypotheses derived from the normative and positive theoretical literature employing recent panel data on 27 European Union member states taking into account endogeneity of the underlying regulation and market structure variables. Our empirical specification employs three different estimators based on instrumental variables in order to identify causal effects. We find evidence supporting both regulators pursuing normative objectives and inefficiencies related to regulatory path dependence, bureaucracy goals and an inadequate consideration of competition from mobile broadband networks. Our results call for adjustments in the institutional design of the decision making process under the current European Union regulatory framework.
Briglauer, Wolfgang
Camarda, Enrico Maria
Vogelsang, Ingo
broadband markets,"old" and "new" networks,EU regulatory framework,normative theory,positive theory,path dependence,bureaucracy,EU panel data
2018
EEG-Umlage: Umverteilung von unten nach oben
http://d.repec.org/n?u=RePEc:zbw:iwkkur:672018&r=all
Die EEG-Umlage, das Instrument zur Förderung des Ausbaus Erneuerbarer Energien verteilt um: Der Anteil ihres Einkommens, den Haushalte mit geringen Einkommen für die EEG-Umlage aufwenden müssen, ist höher als bei einkommensstarken Haushalten. Letztere betreiben häufiger Solaranlagen und profitieren damit von der Förderung.
Schaefer, Thilo
2018
The death of a regulator: Strict supervision, bank lending and business activity
http://d.repec.org/n?u=RePEc:zbw:cfswop:610&r=all
An important question in banking is how strict supervision affects bank lending and in turn local business activity. Forcing banks to recognize losses could choke off lending and amplify local economic woes, especially after financial crises. But stricter supervision could also lead to changes in how banks assess loans and manage their loan portfolios. Estimating such effects is challenging. We exploit the extinction of the thrift regulator (OTS) - a large change in prudential supervision, affecting ten percent of all U.S. depository institutions. Using this event, we analyze economic links between strict supervision, bank lending and business activity. We first show that the OTS replacement indeed resulted in stricter supervision of former OTS banks. We then analyze the lending effects of this regulatory change and show that former OTS banks increase small business lending by approximately 10 percent. This increase stems primarily from wellcapitalized banks and those more affected by the new regime. These findings suggest that stricter supervision operates not only through capital but can also overcome frictions in bank management, leading to more lending and a reallocation of loans. Consistent with the latter, we find increases in business entry and exit in counties with greater expose to OTS banks.
Leuz, Christian
Granja, João
Bank regulation,Enforcement,Loan Losses,Aggregate outcomes,Prudential oversight,Business lending,Entry and exit
2018
Continuous Learning Augmented Investment Decisions
http://d.repec.org/n?u=RePEc:arx:papers:1812.02340&r=all
Investment decisions can benefit from incorporating an accumulated knowledge of the past to drive future decision making. We introduce Continuous Learning Augmentation (CLA) which is based on an explicit memory structure and a feed forward neural network (FFNN) base model and used to drive long term financial investment decisions. We demonstrate that our approach improves accuracy in investment decision making while memory is addressed in an explainable way. Our approach introduces novel remember cues, consisting of empirically learned change points in the absolute error series of the FFNN. Memory recall is also novel, with contextual similarity assessed over time by sampling distances using dynamic time warping (DTW). We demonstrate the benefits of our approach by using it in an expected return forecasting task to drive investment decisions. In an investment simulation in a broad international equity universe between 2003-2017, our approach significantly outperforms FFNN base models. We also illustrate how CLA's memory addressing works in practice, using a worked example to demonstrate the explainability of our approach.
Daniel Philps
Tillman Weyde
Artur d'Avila Garcez
Roy Batchelor
2018-12
Commuting Patterns, the Spatial Distribution of Jobs and the Gender Pay Gap in the U.S.
http://d.repec.org/n?u=RePEc:zbw:glodps:282&r=all
This paper studies to what extent gender differences in commuting patterns explain the observed disparities between husband and wife in relation to earnings and wages. It is argued that the cost of commuting is higher for women because they bear a disproportionate share of housework and child-rearing responsibilities. Therefore, female workers tend to work relatively close to home. A `job location wage gap' emerges because jobs located away from the central business district offer lower wages. Using pooled data from the American Community Survey, the results indicate that 10% of the gender pay gap among childless workers and more than 23% of the wage decline attributed to being a mother ("child pay penalty") are explained by sex differences in commuting patterns. A conditional Oaxaca-Blinder decomposition indicates that short commutes are strongly associated with working in low-paying occupations and industries.
Gutierrez, Federico H.
Gender pay gap,job location,wages,commute time,wage gradient
2018
Elite School Designation and House Prices - Quasi-experimental Evidence from Beijing, China
http://d.repec.org/n?u=RePEc:zbw:glodps:283&r=all
We explore three recent comprehensive reforms which aim to equalize access to elite elementary schools in Beijing, to identify the causal effect of access to quality education on house prices. Using property transaction records from Beijing in 2013 and 2016, we construct a balanced panel of residential complexes, each of which linked to its designated primary school. Whereas the multi-school dicing reform involves randomly assigning previously ineligible pupils to key elementary schools through lotteries, the reform of school federation led by elite schools consolidates ordinary primary schools through alliance with elite schools. Moreover, an ordinary primary school can be promoted to key elementary school without involving neighbouring schools in surrounding residential complexes through a “pure” re-designation effect. We allow for systemic differences between the treated and non-treated residential complexes using the Matching Difference-in-Differences (MDID) approach. Our estimates indicate that the causal effect on house prices of being eligible to enrol in a municipal-level key primary school is about 5-7%, while the premium for being eligible for a less prestigious district-level key primary school is only about 1-3%.
Huang, Bin
He, Xiaoyan
Xu, Lei
Zhu, Yu
quality school designation,house price premium,Matching DID,China
2018
Increasing taxes after a financial crisis: Not a bad idea after all ...
http://d.repec.org/n?u=RePEc:zbw:cfswop:614&r=all
Based on OECD evidence, equity/housing-price busts and credit crunches are followed by substantial increases in public consumption. These increases in unproductive public spending lead to increases in distortionary marginal taxes, a policy in sharp contrast with presumably optimal Keynesian fiscal stimulus after a crisis. Here we claim that this seemingly adverse policy selection is optimal under rational learning about the frequency of rare capital-value busts. Bayesian updating after a bust implies massive belief jumps toward pessimism, with investors and policymakers believing that busts will be arriving more frequently in the future. Lowering taxes would be as if trying to kick a sick horse in order to stand up and run, since pessimistic markets would be unwilling to invest enough under any temporarily generous tax regime.
Koulovatianos, Christos
Mavridis, Dimitris
Bayesian learning,controlled diffusions and jump processes,learning about jumps,Gamma distribution,rational learning
2018
Housing expenditures and income inequality
http://d.repec.org/n?u=RePEc:zbw:zewdip:18048&r=all
In this paper, we show that, in terms of real disposable income, changes in housing expenditures dramatically exacerbate the trend of income inequality that has risen sharply in Germany since the mid-1990s. More specifically, whereas the 50/10 ratio of net household income increases by 22 percentage points (pp) between 1993 and 2013, it increases by 62 pp for income net of housing expenditures. At the same time, the income share of housing expenditures rises disproportionally for the bottom income quintile and falls for the top quintile. Factors contributing to these trends include a decline in the relative costs of homeownership versus renting, changes in household structure, and residential mobility toward larger cities. Younger cohorts spend more on housing and save less than older cohorts did at the same age, with possibly negative consequences for wealth accumulation, particularly for those at the bottom of the income distribution.
Dustmann, Christian
Fitzenberger, Bernd
Zimmermann, Markus
income inequality,housing expenditures
2018
Unternehmen in Deutschland kaum auf No-Deal-Szenario vorbereitet
http://d.repec.org/n?u=RePEc:zbw:iwkkur:692018&r=all
Die Gefahr wächst, dass die Austrittsverhandlungen zwischen der EU und dem Vereinigten Königreich (UK) scheitern. Trotzdem mangelt es in der deutschen Wirtschaft noch an Vorkehrungen für ein solches No-Deal-Szenario und das dann drohende Chaos. Das zeigt eine aktuelle IW-Umfrage unter Unternehmen aus Industrie und industrienahen Dienstleistungen. Selbst bei Firmen, die in das UK exportieren und daher besonderen Risiken des Brexits ausgesetzt sind, sagen 29 Prozent, dass sie nicht vorbereitet sind; weitere 44 Prozent nur in geringem Maß.
Bardt, Hubertus
Matthes, Jürgen
2018
Intergenerational mobility and the rise and fall of inequality: Lessons from Latin America
http://d.repec.org/n?u=RePEc:zbw:zewdip:18049&r=all
Countries with high income inequality also show a strong association between parents' and children's economic well-being; i.e. low intergenerational mobility. This study is the first to test this relationship in a between-country and within-country setup; using harmonized micro data from 18 Latin American countries, spanning multiple cohorts. It is shown that experiencing higher income inequality in childhood is associated with lower intergenerational mobility measured in adulthood. Following the same methodology, the influence of economic growth and public education is evaluated: both are positively, significantly, and substantially associated with intergenerational mobility.
Neidhöfer, Guido
Inequality,Intergenerational Mobility,Equality of Opportunity,Human Capital,Growth,Development,Public Education,Great Gatsby Curve,Latin America
2018
Wer zahlt wie viel Einkommensteuer in Deutschland?
http://d.repec.org/n?u=RePEc:zbw:iwkkur:742018&r=all
Die Einkommensteuer wirkt stark progressiv - das heißt, dass der sich rechnerisch ergebende Durchschnittssteuersatz mit höherem Einkommen ansteigt und dadurch Personen am oberen Ende der Einkommensverteilung überproportional zum Steueraufkommen beitragen. Mit den aktuellen Daten des Sozio-ökonomischen Panels, die die erwachsene Bevölkerung in Deutschland repräsentativ abbilden, lässt sich die Verteilung der Einkommensteuer simulieren.
Beznoska, Martin
2018
Akademikerberufe: Nicht nur die Nachfrage bestimmt den Preis
http://d.repec.org/n?u=RePEc:zbw:iwkkur:662018&r=all
Die Auswertung der Bruttomonatsentgelte von 15 Akademikerberufsgruppen liefert eine eindeutige Tendenz: Je gefragter am Arbeitsmarkt, je höher die Beschäftigungsanteile in der Industrie und je weniger im öffentlichen Dienst tätig, desto höher sind die Löhne. Arzt- und Ingenieurberufe nehmen die vorderen Plätze ein, Sprach- und Gesellschaftswissenschaftler hingegen bilden die Schlussgruppe.
Koppel, Oliver
Schüler, Ruth Maria
2018
A progressive consumption tax: an important instrument for stabilizing business cycles, or just an exotic idea?
http://d.repec.org/n?u=RePEc:zbw:esprep:187772&r=all
We introduce progressive consumption taxation into a real-business-cycle setup augmented with a detailed government sector. We calibrate the model to Bulgarian data for the period following the introduction of the currency board arrangement (1999-2016). We investigate the quantitative importance of the presence of of progressive taxation of consumption expenditures for the stabilization of cyclical fluctuations in Bulgaria. We find the quantitative effect of such a tax to be very small, and thus not important for either business cycle stabilization, or public finance issues.
Vasilev, Aleksandar
business cycles,progressive consumption taxation,Bulgaria
2018
Measuring Financial Capability of the Street Vendors
http://d.repec.org/n?u=RePEc:zbw:esprep:187423&r=all
Financial capability of an individual is ability to use and manage financial products for current and future financial needs with adequate financial knowledge. United Kingdom Financial Services Authority, 2006 defines financial capability as composition of four dimensions: financial management to meet current needs, financial planning for ahead, management of financial products, and financial knowledge. Taking all the above four dimensions into account, paper studies financial capability from a sample of street vendors in Bhubaneswar, India. The financial capability index for each individual has been calculated with recently developed index measure that satisfies MANUSH (Monotonicity, Anonymity, Normalisation, Uniformity, Shortfall sensitivity, Hiatus sensitivity to level) axioms. Paper finds that individual characteristics and business characteristics such as education, age, business experience, daily turnover, affects the financial capability of the individuals. Moreover, paper finds, street vendors in regions with higher bank branches have higher financial capability.
Muduli, Silu
Ramana, D. V.
Financial capability,Financial literacy,Financial inclusion
2018
KI-Investitionen in Deutschland: Noch ein weiter Weg
http://d.repec.org/n?u=RePEc:zbw:iwkkur:702018&r=all
Künstliche Intelligenz (KI) soll weitreichende, positive Wirkungen auf Wirtschaft und Gesellschaft mit sich bringen. Dem zollt auch der diesjährige Digital- Gipfel Tribut. Leider passen die Investitionen des Bundes in die Erforschung von KI bislang aber nicht zu dieser großen Bedeutung des Themas in der öffentlichen Diskussion.
Demary, Vera
Goecke, Henry
2018
Evidence-based policymaking: Promise, challenges and opportunities for accounting and financial markets research
http://d.repec.org/n?u=RePEc:zbw:cfswop:611&r=all
The use of evidence and economic analysis in policymaking is on the rise, and accounting standard setting and financial regulation are no exception. This article discusses the promise of evidence-based policymaking in accounting and financial markets as well as the challenges and opportunities for research supporting this endeavor. In principle, using sound theory and robust empirical evidence should lead to better policies and regulations. But despite its obvious appeal and substantial promise, evidence-based policymaking is easier demanded than done. It faces many challenges related to the difficulty of providing relevant causal evidence, lack of data, the reliability of published research, and the transmission of research findings. Overcoming these challenges requires substantial infrastructure investments for generating and disseminating relevant research. To illustrate this point, I draw parallels to the rise of evidence-based medicine. The article provides several concrete suggestions for the research process and the aggregation of research findings if scientific evidence is to inform policymaking. I discuss how policymakers can foster and support policy-relevant research, chiefly by providing and generating data. The article also points to potential pitfalls when research becomes increasingly policy-oriented.
Leuz, Christian
evidence-based policymaking,cost-benefit analysis,regulation,standard setting,accounting,finance,capital markets,causal inferences,political economy
2018
On the economics of audit partner tenure and rotation: Evidence from PCAOB data
http://d.repec.org/n?u=RePEc:zbw:cfswop:608&r=all
We provide the first partner tenure and rotation analysis for a large cross-section of U.S. publicly listed firms over an extended period. We analyze the effects on audit quality as well as economic tradeoffs with respect to audit hours and fees. On average, we find no evidence for audit quality declines over the tenure cycle and, consistent with the former, little support for fresh-look benefits after five-year mandatory rotations. Nevertheless, partner rotations have significant economic consequences. We find increases in audit fees and decreases in audit hours over the tenure cycle, which differ by partner experience, client size, and competitiveness of the local audit market. Our findings are consistent with efforts by the audit firms to minimize disruptions and audit failures around mandatory rotations. We also analyze special circumstances, such as audit firm or audit team switches and early partner rotations. We show that these situations are more disruptive and more likely to exhibit audit quality effects. In particular, we find that lowquality audits give rise to early engagement partner rotations and in this sense have (career) consequences for partners.
Gipper, Brandon
Hail, Luzi
Leuz, Christian
Auditing,Audit fees,Audit quality,Auditor rotation,Audit partner tenure,Competition,PCAOB
2018
Handelsbeziehungen zwischen der EU und den USA: Pessimismus überwiegt
http://d.repec.org/n?u=RePEc:zbw:iwkkur:732018&r=all
Der zunehmend protektionistische Kurs des US-Präsidenten verunsichert viele Unternehmen in Deutschland. Zwar sorgt die gute Konjunktur in den USA nach wie vor für steigende Exportzahlen im US-Geschäft. Doch der Blick in die Zukunft ist getrübter. Eine Umfrage des Instituts der deutschen Wirtschaft (IW) in Kooperation mit der IW Consult zeigt, dass die deutschen Unternehmen eher mit einer Zuspitzung als mit einer Entspannung im Handelskonflikt rechnen.
Kolev, Galina
2018
Evaluation of Language Training Programs in Luxembourg using Principal Stratification
http://d.repec.org/n?u=RePEc:zbw:glodps:289&r=all
In a world increasingly globalized, multiple language skills can create more employment opportunities. Several countries include language training programs in active labor market programs for the unemployed. We analyze the effects of a language training program on the re-employment probability and hourly wages of the unemployed simultaneously, using highquality administrative data from Luxembourg. We address selection into training by exploiting the rich administrative information available, and account for the complication that wages are “truncated” by unemployment by adopting a principal stratification framework. Estimation is undertaken with a mixture model likelihood-based approach. To improve inference, we use the individual’s hours worked as a secondary outcome and a stochastic dominance assumption. These two features considerably ameliorate the multimodality problem commonly encountered in mixture models. We also conduct sensitivity analysis to assess the unconfoundedness assumption employed. Our results strongly suggest a positive effect (of up to 12.7 percent) of the language training programs on the re-employment probability, but no effects on wages for those who are observed employed regardless of training participation. It appears that, in the context of an open and multilingual economy, language training improve employability but the language skills acquired are not sufficiently rewarded to be reflected in higher wages.
Bia, Michela
Flores-Lagunes, Alfonso
Mercatanti, Andrea
language training programs,policy evaluation,principal stratification,unconfoundedness,sensitivity analysis
2018
Contingent contracts in banking: Insurance or risk magnification?
http://d.repec.org/n?u=RePEc:zbw:cfswop:612&r=all
We examine whether the economy can be insured against banking crises with deposit and loan contracts contingent on macroeconomic shocks. We study banking competition and show that the private sector insures the banking system through such contracts, and banking crises are avoided, provided that failed banks are not bailed out. When risks are large, banks may shift part of them to depositors. In contrast, when banks are bailed out by the next generation, depositors receive non-contingent contracts with high interest rates, while entrepreneurs obtain loan contracts that demand high repayment in good times and low repayment in bad times. As a result, the present generation overinvests, and banks generate large macroeconomic risks for future generations, even if the underlying productivity risk is small or zero. We conclude that a joint policy package of orderly default procedures and contingent contracts is a promising way to reduce the threat of a fragile banking system.
Gersbach, Hans
financial intermediation,macroeconomic risks,state-contingent contracts,banking regulation
2018
Demographics and FDI: Lessons from China's one-child policy
http://d.repec.org/n?u=RePEc:zbw:cfswop:613&r=all
Following the introduction of the one-child policy in China, the capital-labor (K/L) ratio of China increased relative to that of India, and, simultaneously, FDI inflows relative to GDP for China versus India declined. These observations are explained in the context of a simple neoclassical OLG paradigm. The adjustment mechanism works as follows: the reduction in the growth rate of the (urban) labor force due to the one-child policy permanently increases the capital per worker inherited from the previous generation. The resulting increase in China's (domestic K)/L thus "crowds out" the need for FDI in China relative to India. Our paper is a contribution to the nascent literature exploring demographic transitions and their effects on FDI flows.
Donaldson, John B.
Koulovatianos, Christos
Li, Jian
Mehra, Rajnish
Lucas paradox,capital-labor ratio,FDI-intensity,one-child policy
2018
Media Attention and Choice of Major: Evidence from Anti-Doctor Violence in China
http://d.repec.org/n?u=RePEc:zbw:glodps:284&r=all
We study the relationship between media attention and major choices by evaluating how newspaper reports on violence against doctors in China deter students from choosing medicine as their college majors. We collect relevant articles from over 1,200 newspapers and combine them with an administrative dataset including the universe of students admitted to Chinese colleges from 2005 to 2011. An additional article on violence against doctors leads to a 0.5 percent decrease in the number of students choosing medicine majors, especially those training physicians and nurses. This effect doubles when we focus on sub-disciplines training physicians and nurses. Students attending elite colleges and with above-median test scores are more responsive to media attention. Moreover, our analysis reveals that exposure to relevant articles significantly reduce the quality of students choosing medicine majors. Consequently, it significantly reduces the quality of admitted medical students, measured by their entrance exam performance.
Bo, Shiyu
Chen, Y. Joy
Song, Yan
Zhou, Sen
Media attention,College majors,Occupational choice,Health care
2018
Unbundling, regulation and pricing: Evidence from electricity distribution
http://d.repec.org/n?u=RePEc:zbw:zewdip:18050&r=all
Unbundling of vertically integrated utilities has become an integral element in the regulation of network industries and has been implemented in many jurisdictions. The idea of separating the network, as the natural monopoly, from downstream retailing, which may be exposed to competition, is still subject to contentious debate. This is because there is much empirical evidence that unbundling eliminates economies of vertical integration while empirical evidence on price reducing effects is still lacking. In this paper we study the effect of legal unbundling on grid charges in the German electricity distribution industry. Using panel data on German distribution system operators (DSOs) we exploit the variation in the timing of the implementation of legal unbundling and the fact that not all DSOs had to implement unbundling measures. We are also able to identify heterogeneous effects of legal unbundling for different types of price regulation, because we observe a switch in the price regulation regime from rate-of-return regulation to incentive regulation during our observation period. Our findings suggest that legal unbundling of the network stage significantly decreases grid charges in the range of 5% to 9%, depending on the type of price regulation in place.
Heim, Sven
Krieger, Bastian
Liebensteiner, Mario
Vertical Integration,Electricity Distribution,Unbundling,Regulation
2018
Kinderbetreuung: Betreuungslücke sinkt leicht auf 273.000 Plätze
http://d.repec.org/n?u=RePEc:zbw:iwkkur:682018&r=all
Die Zahl der Kinder im Alter von unter drei Jahren in staatlicher oder staatlich geförderter Betreuung ist zwischen März 2017 bis März 2018 um rund 27.000 auf 790.000 gestiegen. Vor dem Hintergrund einer etwas höheren Kinderzahl hat dies zu einem Rückgang der Betreuungslücke um 6.000 auf 273.000 Plätze geführt.
Geis-Thöne, Wido
2018
Does Money Relieve Depression? Evidence from Social Pension Expansions in China
http://d.repec.org/n?u=RePEc:zbw:glodps:285&r=all
We estimate the impact of pension enrollment on mental well-being using China’s New Rural Pension Scheme (NRPS), the largest existing pension program in the world. Since its launch in 2009, more than 400 million Chinese have enrolled in the NRPS. We first describe plausible pathways through which pension may affect mental health. We then use the national sample of China Family Panel Studies (CFPS) to examine the effect of pension enrollment on mental health, as measured by CES-D and self-reported depressive symptoms. To overcome the endogeneity of pension enrollment or of income change on mental health, we exploit geographic variation in pension program implementation. Results indicate modest to large reductions in depressive symptoms due to pension enrollment; this effect is more pronounced among individuals eligible to claim pension income, among populations with more financial constraints, and among those with worse baseline mental health. Our findings hold for a rich set of robustness checks and falsification tests.
Chen, Xi
Wang, Tianyu
Busch, Susan H.
pension enrollment,pension income,depression,mental health,older populations
2018
Gefahr von hartem Brexit macht deutschen Unternehmen Sorgen
http://d.repec.org/n?u=RePEc:zbw:iwkkur:712018&r=all
Trotz der vorläufigen Einigung auf ein Austrittsabkommen kann es weiterhin zu einem harten Brexit kommen. In einer aktuellen Umfrage des Instituts der deutschen Wirtschaft (IW) geht die Mehrheit der befragten deutschen Unternehmen aus Industrie und industrienahen Dienstleistungen von einem solchen Szenario mit deutlich verschlechterten Handelsbedingungen aus. Betroffen sind vor allem Unternehmen mit direkten Handelsbeziehungen in das Vereinigte Königreich (UK). Drei Viertel der in das UK exportierenden Unternehmen rechnen bei einem harten Brexit mit negativen Auswirkungen auf ihre Ausfuhren. Gesamtwirtschaftlich dürften die Folgen allerdings begrenzter sein. Gut 30 Prozent aller befragten Unternehmen rechnen mit leicht negativen Konsequenzen für Produktion und Beschäftigung, aber über 60 Prozent erwarten keine Auswirkungen.
Matthes, Jürgen
Bardt, Hubertus
2018
Putting the pension back in 401(k) retirement plans: Optimal versus default longevity income annuities
http://d.repec.org/n?u=RePEc:zbw:cfswop:607&r=all
A recent US Treasury regulation allowed deferred longevity income annuities to be included in pension plan menus as a default payout solution, yet little research has investigated whether more people should convert some of the $15 trillion they hold in employer-based defined contribution plans into lifelong income streams. We investigate this innovation using a calibrated lifecycle consumption and portfolio choice model embodying realistic institutional considerations. Our welfare analysis shows that defaulting a small portion of retirees' 401(k) assets (over a threshold) is an attractive way to enhance retirement security, enhancing welfare by up to 20% of retiree plan accruals.
Horneff, Vanya
Maurer, Raimond
Mitchell, Olivia S.
life cycle saving,household finance,annuity,longevity risk,401(k) plan,retirement
2018
Capital gains taxation and funding for start-ups
http://d.repec.org/n?u=RePEc:zbw:zewdip:18046&r=all
We examine how capital gains taxes affect investment in start-up (i.e., pre-IPO) firms. Using data on capital raised by start-up firms in individual funding rounds, we estimate the effect of the SBJA of 2010, which implemented a full exemption from federal capital gains tax on the sale of qualified shares. Because of higher expected after-tax returns (lower future capital gains taxes), we hypothesize and find evidence consistent with this capital gains tax reduction increasing the amount of investment in start-up firms per funding round by about 12%. We also provide evidence that this effect is concentrated in start-up firms that are likely to be more financially sophisticated.
Edwards, Alexander
Todtenhaupt, Maximilian
Capital Gains Taxes,Start-ups,Tax Capitalization
2018
Forecasting Tourist Arrivals with Google Trends and Mixed Frequency Data
http://d.repec.org/n?u=RePEc:zbw:esprep:187420&r=all
In this paper, we examine the usefulness of Google Trends data in predicting monthly tourist arrivals and overnight stays in Prague during the period between January 2010 and December 2016. We offer two contributions. First, we analyze whether Google Trends provides significant forecasting improvements over models without search data. Second, we assess whether a high-frequency variable (weekly Google Trends) is more useful for accurate forecasting than a low-frequency variable (monthly tourist arrivals) using Mixed-data sampling (MIDAS). Our results stress the potential of Google Trends to offer more accurate prediction in the context of tourism: we find that Google Trends information, both two months and one week ahead of arrivals, is useful for predicting the actual number of tourist arrivals. The MIDAS forecasting model that employs weekly Google Trends data outperforms models using monthly Google Trends data and models without Google Trends data.
Havranek, Tomas
Zeynalov, Ayaz
Google trends,mixed-frequency data,forecasting,tourism
2018
Some unpleasant consequences of testing at length
http://d.repec.org/n?u=RePEc:zbw:glodps:286&r=all
Using Italian data on standardized test scores, we show that the performance decline associated with question position is heterogeneous across students. This fact implies that the rank of individuals and classes depends on the length of the test. Longer tests may also exhibit larger gaps between the variance of test scores and the variance of underlying ability. The performance decline is correlated with both cognitive and non-cognitive abilities and there is also evidence that those with better parental background experience a smaller decline than those with poorer background. Therefore, the gap between the two groups widens in longer tests.
Brunello, Giorgio
Crema, Angela
Rocco, Lorenzo
low stake tests,position of questions,cognitive and non-cognitive skills,Italy
2018
How do working life and its interplay with family structures affect men’s and women’s gender role attitudes?
http://d.repec.org/n?u=RePEc:zbw:esprep:188988&r=all
Using fixed effects models and longitudinal data from the British Household Panels Surveys (BHPS) and the follow-up study “Understanding Society” (UKHLS), the current study examines the impact of change in employment status and working conditions on gender role attitudes by simultaneously considering the family structure. A second research question investigates whether employment status and family life interact with one another regarding their influence on gender role attitudes. This study shows that men are more traditional before marriage as well as after separation or divorce, while the same correlation does not seem to exist for women. Moreover, having children affects men’s but not women’s tendencies towards more traditional attitudes. A further important conclusion drawn in this study is that employment status moderates the relationship between children and gender role attitudes: women working full-time develop more egalitarian gender role attitudes if they have additional children while their counterparts who are only working part-time or not working at all become more traditional in the same situation. Regarding occupational circumstances, it turns out that, for men, egalitarianism decreases as income increases; for women, on the other hand, the opposite is the case. Further, job satisfaction affects only the gender role attitudes of women: the higher the job satisfaction is the more egalitarian are their attitudes. In sum, our findings demonstrate that it is essential to consider both family structures and employment circumstances — not to mention their interdependency — to gain a deeper understanding of changes in gender role attitudes of adults.
Mays, Anja
gender roles,attitude change,women,employment,work
2018
Anti-Migration as a Threat to Internationalization? A Review of the Migration-Internationalization Literature
http://d.repec.org/n?u=RePEc:zbw:glodps:287&r=all
Does anti-migration sentiment threaten internationalization? One major pro-Brexit argument was that it would enable more control over immigration. The most recent US presidential election also focused on immigration. Anti-migration sentiment could be a threat to internationalization, given that migrants can help lower the costs of internationalization. Since trade contributes to economic growth, this could, in turn, impede economic development. Despite extensive literature on the migration-trade nexus, there are few examples of policymakers highlighting the role of migration for internationalization. One possible explanation is the absence of an accessible survey of the available theory and evidence on this relationship, and this article intends to bridge the gap. We review and discuss over 100 papers published on the subject, from pioneering country-level studies to nascent firm-level studies that utilize employer-employee data. To our knowledge, this is the first paper offering a wide-ranging review of the different strands of theory on the relationship between migration and internationalization, as well as new empirical findings. Although the evidence suggests that migration can facilitate internationalization we also note substantial gaps and inconsistencies in the extant literature. The aim of this article is to encourage future research and assist policymakers in their efforts to promote internationalization.
Hatzigeorgiou, Andreas
Lodefalk, Magnus
Migration,networks,information,trade,foreign direct investment
2018
Who falls prey to the Wolf of Wall Street? Investor participation in market manipulation
http://d.repec.org/n?u=RePEc:zbw:cfswop:609&r=all
Manipulative communications touting stocks are common in capital markets around the world. Although the price distortions created by so-called "pump-and-dump" schemes are well known, little is known about the investors in these frauds. By examining 421 "pump-and-dump" schemes between 2002 and 2015 and a proprietary set of trading records for over 110,000 individual investors from a major German bank, we provide evidence on the participation rate, magnitude of the investments, losses, and the characteristics of the individuals who invest in such schemes. Our evidence suggests that participation is quite common and involves sizable losses, with nearly 6% of active investors participating in at least one "pump-and-dump" and an average loss of nearly 30%. Moreover, we identify several distinct types of investors, some of which should not be viewed as falling prey to these frauds. We also show that portfolio composition and past trading behavior can better explain participation in touted stocks than demographics. Our analysis offers insights into the challenges associated with designing effective investor protection against market manipulation.
Leuz, Christian
Meyer, Steffen
Muhn, Maximilian
Soltes, Eugene
Hackethal, Andreas
Market manipulation,Pump-and-dump schemes,Securities regulation,Fraud,Investor protection,Lottery stocks,Household finance
2018
Using published bid/ask curves to error dress spot electricity price forecasts
http://d.repec.org/n?u=RePEc:arx:papers:1812.02433&r=all
Accurate forecasts of electricity spot prices are essential to the daily operational and planning decisions made by power producers and distributors. Typically, point forecasts of these quantities suffice, particularly in the Nord Pool market where the large quantity of hydro power leads to price stability. However, when situations become irregular, deviations on the price scale can often be extreme and difficult to pinpoint precisely, which is a result of the highly varying marginal costs of generating facilities at the edges of the load curve. In these situations it is useful to supplant a point forecast of price with a distributional forecast, in particular one whose tails are adaptive to the current production regime. This work outlines a methodology for leveraging published bid/ask information from the Nord Pool market to construct such adaptive predictive distributions. Our methodology is a non-standard application of the concept of error-dressing, which couples a feature driven error distribution in volume space with a non-linear transformation via the published bid/ask curves to obtain highly non-symmetric, adaptive price distributions. Using data from the Nord Pool market, we show that our method outperforms more standard forms of distributional modeling. We further show how such distributions can be used to render `warning systems' that issue reliable probabilities of prices exceeding various important thresholds.
Gunnhildur H. Steinbakk
Alex Lenkoski
Ragnar Bang Huseby
Anders L{\o}land
Tor Arne {\O}ig{\aa}rd
2018-12
Nicht-personenbezogene Daten: Der nächste Schritt zum digitalen Binnenmarkt
http://d.repec.org/n?u=RePEc:zbw:iwkkur:722018&r=all
Das EU-Parlament hat am 4. Oktober einen Vorschlag für eine Verordnung für den freien Verkehr nicht-personenbezogener Daten in der Europäischen Union beschlossen. Die Verordnung soll Ende dieses Jahres noch in Kraft treten und die Wettbewerbsfähigkeit europäischer Unternehmen in der globalen Datenökonomie stärken.
Scheufen, Marc
2018
Securities Financing and Asset Markets: New Evidence
http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-2018-22&r=all
This paper presents new evidence on bilateral securities financing based on the Federal Reserve's Senior Credit Officer Opinion Survey, which was launched in the wake of the financial crisis to provide a window into this otherwise opaque market. The survey asks large broker-dealers about terms at which they fund client positions, and the demand for such funding, across several different collateral types. Within asset classes, reported changes in spreads, haircuts, and other financing terms move closely together, and we show that they also covary with the state of the underlying cash securities markets. Funding conditions are particularly highly correlated with measures of cash-market liquidity, and, by exploiting dealers' self-reported reasons for changing terms, we show that most of this correlation results from dealers responding to liquidity, rather than the other way around. Controlling for securities-market conditions, haircuts and spreads are unresponsive to shifts in funding demand; however, they do tend to tighten when measures of dealer condition deteriorate.
Breach , Tomas
King, Thomas B.
Repo; securities lending; adverse selection; haircut
2018-11-27
RUSSIA AND THE EURASIAN ECONOMIC UNION: CONFLICTING INCENTIVES FOR AN INSTITUTIONAL COMPROMISE
http://d.repec.org/n?u=RePEc:hig:wpaper:31/ir/2018&r=all
The Eurasian Economic Union (EAEU) is the first and relatively successful attempt to establish strong multilateral institutions of post-Soviet regional integration. The EAEU has greater scope of supranationalism compared to all previous post-Soviet integration projects and the Union’s multilateral institutions are based on the formal recognition of equal status of all the members. However, such a union is unlikely to promote the Russian economic and political dominance in the region, at least compared to what would be attainable through bilateral deals. On contrary, the post-soviet countries got opportunities to act more independently from Russia. We argue that it was the Ukrainian crisis in spring 2014 and the need to promote the domestic image of Russia as “great power” that created incentives for Russian leadership to accept institutional compromises necessary to initiate the Eurasian Economic Union.
Irina Busygina
Mikhail Filippov
Domestic Legitimacy; Eurasian Economic Union; Incentives; Belarus; Kazakhstan; Russia; Bilateral Relations; Multi-lateral Relations; Sovereignty; Ukraine crisis.
2018
The U.S. Syndicated Loan Market : Matching Data
http://d.repec.org/n?u=RePEc:fip:fedgfe:2018-85&r=all
We introduce a new software package for determining linkages between datasets without common identifiers. We apply these methods to three datasets commonly used in academic research on syndicated lending: Refinitiv LPC DealScan, the Shared National Credit Database, and S&P Global Market Intelligence Compustat. We benchmark the results of our match using results from the literature and previously matched files that are publicly available. We find that the company level matching is enhanced by careful cleaning of the data and considering hierarchical relationships. For loan level matching, a tailored approach based on a good understanding of the data can be better in certain dimensions than a more pure machine learning approach. The R package for the company level match can be found on Github.
Gregory J. Cohen
Melanie Friedrichs
Kamran Gupta
William Hayes
Seung Jung Lee
W. Blake Marsh
Nathan Mislang
Maya Shaton
Martin Sicilian
Bank credit ; Company level matching ; Loan level matching ; Probabilistic matching ; Syndicated loans
2018-12-07
Do information and communication technologies (ICT) improve educational outcomes? Evidence for Spain in PISA 2015
http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2018-20&r=all
With the world becoming increasingly digitalized, determining the relationship between the use of ICT in the learning process and educational outcomes takes on special relevance for guiding educational policy decisions in a reasoned way. The objective of this study is to evaluate the effect on academic performance of the use and availability of Information and Communication Technologies (ICT) at school and at home. For this purpose, we apply a hierarchical lineal regression model approach with data from the Programme for International Student assessment survey (PISA) 2015. PISA 2015 contains a brief but specific questionnaire for ICT that is completed voluntarily in some of the countries participating in the survey, as is the case in Spain. The results show differences in the sign of the impact according to the ICT variable used. The positive impact of ICT use is associated with its use for entertainment at home and with the students’ interest in ICT. However, the use of ICT for schoolwork at home and the general use of ICT by students in schools have negative effects on the learning process. Another significant result is the magnitude of the coefficient for the relation between the starting age for using ICT on the scores in the three competences. The higher the age, the lower the score achieved. The results of the regressions by tertiles of performance show that ICT can also play an important role in improving the academic performance of the students with the worst results. Finally, some control variables related to students, home and location are also relevant in our models.
Nerea Gómez-Fernández
Mauro Mediavilla
Education, PISA 2015, ICT, Spain, Academic Performance
2018
College Scholarships as a Tool for Community Development? Evidence from the Kalamazoo Promise
http://d.repec.org/n?u=RePEc:hcx:wpaper:1812&r=all
On November 10, 2005, the Kalamazoo Public School District announced that a group of anonymous donors had funded a new college scholarship program for district graduates named the Kalamazoo Promise. The primary qualification for scholarship eligibility is continuous residency and enrollment in the Kalamazoo Public School District, and the scholarship is set up in perpetuity. This study assesses the extent to which the Kalamazoo Promise is serving as an economic development tool. Results indicate that the Kalamazoo Promise dramatically increased enrollment in the Kalamazoo Public School District, but there is no evidence that the Kalamazoo Promise increased home values in the district.
Ashley Miller
promise scholarships, financial aid, economic development tools, place-based policies
2018-12
Accounting for Macro-Finance Trends: Market Power, Intangibles, and Risk Premia
http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-2018-19&r=all
Real risk-free interest rates have trended down over the past 30 years. Puzzlingly in light of this decline, (1) the return on private capital has remained stable or even increased, creating an increasing wedge with safe interest rates; (2) stock market valuation ratios have increased only moderately; (3) investment has been lackluster. We use a simple extension of the neoclassical growth model to diagnose the nexus of forces that jointly accounts for these developments. We find that rising market power, rising unmeasured intangibles, and rising risk premia, play a crucial role, over and above the traditional culprits of increasing savings supply and technological growth slowdown.
Farhi, Emmanuel
Gourio, Francois
investment; equity premium; risk-free rate; profitability; valuation ratios; labor share; competition; markups; safe assets
2018-11-01
Banks, Sovereign Risk and Unconventional Monetary Policies
http://d.repec.org/n?u=RePEc:gat:wpaper:1830&r=all
We develop a two-country model with an explicitly microfounded interbank market and sovereign default risk. Calibrated to the core and the periphery of the Euro Area, the model gives rise to a debt-banks-credit loop that substantially amplifies the effects of financial shocks, especially for the periphery. We use the model to investigate the effects of a stylized public asset purchase program at the steady state and during a crisis. We find that it is more effective in stimulating the economy during a crisis, in particular for the periphery.
Stéphane Auray
Aurélien Eyquem
Xiaofei Ma
Recession, Interbank Market, Sovereign Default Risk, Asset Purchases
2018
RESIDENTS’ COPRODUCTION ACTIVITIES AS THE BASIS OF URBAN DEVELOPMENT: THE CASE OF THE FOOTBALL WORLD CUP IN VOLGOGRAD
http://d.repec.org/n?u=RePEc:hig:wpaper:07/urb/2018&r=all
Coproduction is a practice that encourages active interaction between customers and producers in creating products, services or events. In the urban management framework the above-mentioned concept is just starting to be put into practice and is characterized by the involvement of residents in different city activities' organization including mega events managed by local authorities. The new types of interaction between residents and authorities include participation of residents as volunteers in organization and carrying out of different city events and activities, mass collaboration or crowdsourcing, crowdfunding, recommendations to external stakeholders, couchsurfing, and slum tourism. The article examines the theoretical aspects of coproduction concept introduction in urban development, describes the types of interaction between residents and local authorities as well as the benefits of this interaction. The author has developed and empirically verified a conceptual model for willingness assessment of residents to participate in coproduction of mega events based on the example of the city of Volgograd which hosted one of the Football World Cup stages.
Aleksandra Sazhina
coproduction, residents, urban development, mega events, place marketing
2018
WAGE ADJUSTMENT POLICIES IN RUSSIAN FIRMS
http://d.repec.org/n?u=RePEc:hig:wpaper:205/ec/2018&r=all
Wage adjustments for employees are a reaction mechanism to changing market conditions and form a significant part of pay policy. Though various attempts to explore wage levels and wage differentials have been made, wage adjustment policies remain an understudied topic. This paper analyses the determinants of wage adjustments based on data from Russian enterprises 2015–17. The analysis is based on detailed data from an employer survey which covers more than 5,000 firms in both the public and private sector. The study adopts probit models to identify the reasons which determine wage revisions, depending on internal employer characteristics and external labour market conditions. The results are in line with previous research on the topic (Bayo-Moriones et al., 2016) and suggest that both internal and external factors influence wage adjustments. A wage adjustment is a reflection of the ability to pay meaning that revisions are often made by successful firms with high employee turnover. Institutional frameworks, especially trade union activity, affects the firm’s decision to adjust wages despite the general opinion on the insignificance of unions in Russia. This study contributes to the limited literature by analysing the determinants of wage policies depending on the firm’s characteristics. This is the first study of its kind based on extensive Russian data.
Ksenia V. Rozhkova
Sergey Yu. Roshchin
Sergey A. Solntsev
Russia, wage adjustment, pay policy, pay settlement, trade union
2018
How Analysts and Whisperers Use Fundamental Accounting Signals To Make Quarterly EPS Forecasts
http://d.repec.org/n?u=RePEc:hcx:wpaper:1707&r=all
We examine the relative efficiency of whisperers’ and analysts’ forecasts of one-quarter-ahead earnings per share (EPS) and identify commonalities and differences in their use of fundamentals to forecast earnings. Results suggest that (a) fundamentals that focus on sales and cost of sales are relevant in explaining one-quarter-ahead EPS changes; (b) whisperers focus on cash flow fundamentals and accrual-based earnings measures in their one-quarter-ahead forecasts, whereas analysts focus on only cash flow fundamentals; and (c) although neither analysts nor whisperers fully incorporate information contained in fundamentals and accrual-based earnings measures in their forecasts, whisperers’ earnings forecast model (forecast errors model) exhibits higher (lower) explanatory power than that of analysts. We also examine robustness of our results by reestimating the models using a two-way random-effects panel data estimator. Although our conclusions remain the same, more statistically significant fundamentals emerge in panel regression results. Evidence presented in this article is consistent with (a) whisperers being different from analysts and (b) whisper forecasts containing unique incremental information beyond that of analysts’ forecasts. Market participants may want to consider using both forecasts when making investment decisions.
Susan Wahab
Karen Teitel
Bernard Morzuch
Accounting, Earnings
2017-12
Asset Pricing with Endogenously Uninsurable Tail Risk
http://d.repec.org/n?u=RePEc:fip:fedmsr:570&r=all
This paper studies asset pricing in a setting in which idiosyncratic risk in human capital is not fully insurable. Firms use long-term contracts to provide insurance to workers, but neither side can commit to these contracts; furthermore, worker-firm relationships have endogenous durations owing to costly and unobservable effort. Uninsured tail risk in labor earnings arises as a part of an optimal risk-sharing scheme. In the general equilibrium, exposure to the resulting tail risk generates higher risk premia, more volatile returns, and variations in expected returns across firms. Model outcomes are consistent with the cyclicality of factor shares in the aggregate, and the heterogeneity in exposures to idiosyncratic and aggregate shocks in the cross section.
Ai, Hengjie
Bhandari, Anmol
Equity premium puzzle; Dynamic contracting; Tail risk; Limited commitment
2018-08-22
Overhead Cost Allocation and Earnings Manipulation Between Quarters
http://d.repec.org/n?u=RePEc:hcx:wpaper:1811&r=all
Much as with annual earnings reports, the potential exists for management to manipulate quarterly earnings reports to improve certain metrics and increase bonuses and other rewards. This study examines the conditions in which applied overhead rates could be used to manipulate quarterly earnings reports and finds evidence that such manipulation could be occurring.
Susan Wahab
Karen Teitel
Accounting, Earnings
2018-12
Do Household Finances Constrain Unconventional Fiscal Policy?
http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-2018-16&r=all
When the zero lower bound on nominal interest rate binds, monetary policy makers may lack traditional tools to stimulate aggregate demand. We investigate whether “unconventional” fiscal policy, in the form of pre-announced consumption tax changes, has the potential to meaningfully shift durables purchases intertemporally and how it is affected by consumer credit. In particular, we test whether car sales react in anticipation of future sales tax changes, leveraging 57 pre-announced changes in state sales tax rates from 1999-2017. We find evidence for substantial tax elasticities, with car sales rising by over 8% in the month before a 1% increase in the sales tax rate. Responses are heterogeneous across households and sensitive to supply of credit. Consumers with high credit risk scores are most able to pull purchases forward. At the same time, other effects such as customer composition and attention lead to an even larger tax elasticity during recessions, despite these credit frictions. We discuss policy implications and the likely magnitudes of tax changes necessary for any substantive long-term responses.
Baker, Scott R.
Kueng, Lorenz
McGranahan, Leslie
Melzer, Brian T.
counter-cyclical fiscal policy; credit market frictions; consumer durables; household; fiscal policy
2018-10-16
Liquidity Regulation and Financial Intermediaries
http://d.repec.org/n?u=RePEc:fip:fedgfe:2018-84&r=all
We document several effects of the Liquidity Coverage Ratio (LCR) rule on dealers' financing and intermediation of securities. For identification, we exploit the fact that the US implementation is more stringent than that in foreign jurisdictions. In line with LCR incentives, US dealers reduce their reliance on repos as a way to finance inventories of high-quality assets and increase the maturity of lower-quality repos relative to foreign dealers; additionally, US dealers cut back on trades that downgrade their own collateral. Dealers are nevertheless still providing significant maturity transformation. We also show that significant de-risking occurs immediately after the 2007-09 crisis, before post-crisis regulations.
Marco Macchiavelli
Luke Pettit
Basel III ; Broker-dealers ; Liquidity coverage ratio ; Repurchase agreements
2018-12-06
Parallel tracks towards a global treaty on carbon pricing
http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2018-12&r=all
We argue that a global carbon price is the only way to effectively tackle free riding in international climate policy, required to substantially reduce greenhouse gas emissions. We briefly review the main reasons behind the essential role of carbon pricing, address common misunderstandings and scepticism, and identify key complementary policy instruments. Negotiating global carbon pricing is argued to be much easier than negotiating binding country-level targets, especially if it includes equitable revenue recycling. Moreover, a global carbon price can be more readily adapted to new data and insights of climate science. We propose a political strategy towards a global carbon price that consists of two tracks. The first entails assembly of a carbon-pricing club, a specific case of a climate club, to gradually move towards a full participatory agreement on carbon pricing. The second track involves putting time and energy into re-focusing UNFCCC negotiations on a carbon-pricing agreement. The two tracks reinforce one another, increasing the likelihood of a successful outcome.
Jeroen C.J.M. van den Bergh
Arild Angelsen
Andrea Baranzini
W.J. Wouter Botzen
Stefano Carattini
Stefan Drews
Tessa Dunlop
Eric Galbraith
Elisabeth Gsottbauer
Richard B. Howarth
Emilio Padilla
Jordi Roca
Robert Schmidt
Carbon Tax, Carbon Market, Cap-and-Trade, Tradable Permits, Equity, Climate Agreement, Climate Club
2018
Level Shifts in Beta, Spurious Abnormal Returns and the TARP Announcement
http://d.repec.org/n?u=RePEc:fip:fedgfe:2018-81&r=all
Using high frequency data, we develop an event study method to test for level shifts in beta and measure abnormal returns for events that produce such level shifts. Using this method, we estimate abnormal returns for the Troubled Asset Relief Program (TARP) announcement and find that its abnormal returns are largely realized on the first day. The abnormal returns in the remaining post event period, which show up as a drift using standard methodology, are attributed to level shifts in beta.
Andrew Phin
Todd Prono
Jonathan J. Reeves
Konark Saxena
Event studies ; Intraday returns ; Systematic risk
2018-11-30
College Tuition and Income Inequality
http://d.repec.org/n?u=RePEc:fip:fedmsr:569&r=all
This paper evaluates the role of rising income inequality in explaining observed growth in college tuition. We develop a competitive model of the college market in which college quality depends on instructional expenditure and the average ability of admitted students. An innovative feature of our model is that it allows for a continuous distribution of college quality. We find that observed increases in US income inequality can explain more than the entire observed rise in average net tuition since 1990 and that rising income inequality has also depressed college attendance.
Cai, Zhifeng
Heathcote, Jonathan
College tuition; Income inequality; Club goods
2018-07-31
Flexible Retirement and Optimal Taxation
http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-2018-18&r=all
This paper studies optimal insurance against private idiosyncratic shocks in a life-cycle model with intensive labor supply and endogenous retirement. In this environment, the optimal labor tax is hump-shaped in age: insurance benefits of taxation push for increasing-in-age taxes while rising labor supply elasticities and optimal late retirement of highly productive workers push for lowering taxes for old workers. In calibrated numerical simulations, the optimum achieves sizable welfare gains that age-dependent taxes do not deliver under the status quo US Social Security. Nevertheless, an optimal combination of age-dependent linear taxes with increasing-in-age retirement benefits generates welfare gains close to optimal.
Ndiaye, Abdoulaye
Retirement; Optimal Taxation; Social Security; Continuous- Time; Optimal Stopping
2017-11-03
Optimal Capital Taxation Revisited
http://d.repec.org/n?u=RePEc:fip:fedmsr:571&r=all
We revisit the question of how capital should be taxed. We allow for a rich set of tax instruments that consists of taxes widely used in practice, including consumption, dividend, capital, and labor income taxes. We restrict policies to respect promises that the government has made in the previous period regarding the current value of wealth. We show that capital should not be taxed if households have preferences that are standard in the macroeconomics literature. We show that Ramsey outcomes that must respect such promises are time consistent. We show that the presumption in the literature that capital should be taxed for some length of time arises because the tax system is restricted.
Chari, V. V.
Nicolini, Juan Pablo
Teles, Pedro
Capital income tax; Time consistency; Production efficiency
2018-09-28
Spending Multipliers with Distortionary Taxes: Does the Level of Public Debt Matter?
http://d.repec.org/n?u=RePEc:gat:wpaper:1831&r=all
We investigate the link between the size of government indebtedness and the effectiveness of government spending shocks in normal times and at the Zero Lower Bound (ZLB). We develop a New Keynesian model with capital, distortionary taxes and public debt in which the ZLB constraint on the nominal interest rate may be binding. In normal times, high steady-state levels of government debt to GDP lead to reduced output multipliers. After a negative capital quality shock that pushes the economy at the ZLB however, high steadystate debt levels produce larger output multipliers. Our results rely on the fact that fiscal policy becomes self-financing at the ZLB, and that distortionary taxes rise (respectively fall) after a spending shock at the steady state (resp. ZLB). Our results have non-trivial consequences on the design of optimized spending policies in the event of large economic downturns.
Rym Aloui
Aurélien Eyquem
Zero Lower Bound, Fiscal Policy, Distortionary Taxes, Public Debt
2018
RUSSIAN POLICY OF THE PIVOT TO THE EAST: PUZZLE OF EXPORTS, FTAS AND EURASIAN INTEGRATION
http://d.repec.org/n?u=RePEc:hig:wpaper:32/ir/2018&r=all
An idea of lagging Pivot, so that Russian Policy of Pivot to the East Asia cannot last successfully on a long-term basis keeping an extensive lag between political and economic dimensions of the Pivot, becomes widely spread in Russia and abroad. And one of the most inevitable and necessary conditions of bridging this gap together can be found among instruments of trade liberalization with FTAs ahead. Here we should shift our focus from Russian interests to Eurasian economic Union (EAEU) that has a privileged mandate on trade negotiations with third countries and blocs like ASEAN: Russia cannot sign any FTA on its own since 2015. However, this puzzle was relatively poorly studied both in Russia and abroad and this paper attempts to fill this gap. We briefly analyze the scope of trade between Russia and key Asian markets (which still remain mostly limited to North-East Asia) to define the most sensitive export markets for Russia, then we systematize existing barriers that could be potentially eliminated by international trade negotiations and compare them with existing international activity of the Eurasian Economic Commission (EEC). Results of our study clearly demonstrate an objective demand for more intensive EAEU activity on trade liberalization in Asia with a particular focus on non-tariff barriers.
Anastasia B. Likhacheva
Hryhorii M. Kalachyhin
Pivot to Asia, political economy, geoeconomics, FTA, integration, non-tariff barriers, Russia, North-East Asia, EAEU
2018
Organizational Equilibrium with Capital
http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-2018-20&r=all
This paper proposes a new equilibrium concept - organizational equilibrium - for models with state variables that have a time inconsistency problem. The key elements of this equilibrium concept are: (1) agents are allowed to ignore the history and restart the equilibrium; (2) agents can wait for future agents to start the equilibrium. We apply this equilibrium concept to a quasi-geometric discounting growth model and to a problem of optimal dynamic fiscal policy. We find that the allocation gradually transits from that implied by its Markov perfect equilibrium towards that implied by the solution under commitment, but stopping short of the Ramsey outcome. The feature that the time inconsistency problem is resolved slowly over time rationalizes the notion that good will is valuable but has to be built gradually.
Bassetto, Marco
Huo, Zhen
Rios-Rull, Jose-Victor
Capital; fiscal policy; Markov equilibrium; Quasi-geometry
2018-11-30
Laboratory Evidence on the Effects of Sponsorship on the Competitive Preferences of Men and Women
http://d.repec.org/n?u=RePEc:hcx:wpaper:1815&r=all
Sponsorship programs have been proposed as one way to promote female advancement in competitive career fields. A sponsor is someone who advocates for a protégé, and in doing so, takes a stake in her success. We use a laboratory experiment to explore two channels through which sponsorship has been posited to increase advancement in a competitive workplace. In our setting, being sponsored provides a vote of confidence and/or creates a link between the protégé’s and sponsor’s payoffs. We find that both features of sponsorship significantly increase willingness to compete among men on average, while neither of these channels significantly increases willingness to compete among women on average. As a result, sponsorship does not close the gender gap in competitiveness or earnings. We discuss how these insights from the laboratory could help to inform the design of sponsorship programs in the field.
Katherine Coffman
2018-12
Very Simple Markov-Perfect Industry Dynamics: Empirics
http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-2018-17&r=all
This paper develops an econometric model of firm entry, competition, and exit in oligopolistic markets. The model has an essentially unique symmetric Markov-perfect equilibrium, which can be computed very quickly. We show that its primitives are identified from market-level data on the number of active firms and demand shifters, and we implement a nested fixed point procedure for its estimation. Estimates from County Business Patterns data on U.S. local cinema markets point to tough local competition. Sunk costs make the industry's transition following a permanent demand shock last 10 to 15 years.
Abbring, Jaap H.
Campbell, Jeffrey R.
Tilly, Jan
Yang, Nan
demand uncertainty; dynamic oligopoly; firm entry and exit; nested fixed point; estimator; sunk costs; toughness of competition; counterfactual policy analysis; Markov process
2018-07-24
Germs, Social Networks, and Growth
http://d.repec.org/n?u=RePEc:fip:fedmsr:572&r=all
Does the pattern of social connections between individuals matter for macroeconomic outcomes? If so, where do these differences come from and how large are their effects? Using network analysis tools, we explore how different social network structures affect technology diffusion and thereby a country's rate of growth. The correlation between high-diffusion networks and income is strongly positive. But when we use a model to isolate the effect of a change in social networks, the effect can be positive, negative, or zero. The reason is that networks diffuse ideas and disease. Low-diffusion networks have evolved in countries where disease is prevalent because limited connectivity protects residents from epidemics. But a low-diffusion network in a low-disease environment needlessly compromises the diffusion of good ideas. In general, social networks have evolved to fit their economic and epidemiological environment. Trying to change networks in one country to mimic those in a higher-income country may well be counterproductive.
Fogli, Alessandra
Veldkamp, Laura
Growth; Development; Technology diffusion; Economic networks; Social networks; Pathogens; Disease
2018-11-19
Is changing the minimum legal drinking age an effective policy tool?
http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2018-19&r=all
In year 1991 regional governments in Spain started a period of implementation of a law that rose the Minimum Legal Drinking Age from 16 to 18 years old. This process was fully completed in year 2015. To evaluate the effects of this change on consumption of legal drugs and its related morbidity outcomes, we construct a regional panel dataset on alcohol consumption and hospital entry registers and compare variation in several measures of prevalence between the treatment group (16-18 years old individuals) and the control group (20-22 years old individuals). Our findings show important differences by gender. Firstly, our main result regarding overall drinking prevalence show reductions ranging from -11.57% for the subsample including both genders to -14.31% for the subsample of males. Secondly, effects on males are driven mainly by reductions in beer with alcohol consumption (-8.98%). Thirdly, effects on wine and/or cava drinking prevalence range from -12.62% for the subsample including both genders to -9.65% for the subsample of females. No effects regarding overall smoking prevalence are found. Fourthly, we do not find evidence that these reductions in alcohol consumption are translated into hospitalizations related to alcohol overdose. To our knowledge, this is the first paper providing evidence on gender-based differences to policies aimed at reducing alcohol consumption. Our results have important policy implications for countries currently considering changes in the Minimum Legal Drinking Age.
Nicolai Brachowicz Quintanilla
Judit Vall Castelló
Evaluation of Public Policies, Health Economics, Minimum Legal Drinking Age, Differences in Differences, Drug Consumption
2018
Transitional Dynamics in Aggregate Models of Innovative Investment
http://d.repec.org/n?u=RePEc:fip:fedmsr:573&r=all
What quantitative lessons can we learn from models of endogenous technical change through innovative investments by firms for the impact of changes in the economic environment on the dynamics of aggregate productivity in the short, medium, and long run? We present a unifying model that nests a number of canonical models in the literature and characterize their positive implications for the transitional dynamics of aggregate productivity and their welfare implications in terms of two sufficient statistics. We review the current state of measurement of these two sufficient statistics and discuss the range of positive and normative quantitative implications of our model for a wide array of counterfactual experiments, including the link between a decline in the entry rate of new firms and a slowdown in the growth of aggregate productivity given that measurement. We conclude with a summary of the lessons learned from our analysis to help direct future research aimed at building models of endogenous productivity growth useful for quantitative analysis.
Atkeson, Andrew
Burstein, Ariel
Chatzikonstantinou, Manolis
Endogenous growth; Innovative investment; Transitional dynamics
2018-11-30
Discretion Rather than Rules: Equilibrium Uniqueness and Forward Guidance with Inconsistent Optimal Plans
http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-2018-14&r=all
New Keynesian economies with active interest rate rules gain equilibrium determinacy from the central bank’s incredible off-equilibrium-path promises (Cochrane, 2011). We suppose instead that the central bank sets interest rate paths and occasionally has the discretion to change them. Private agents taking future central bank actions and their own best responses to them as given reduces the scope for self-fulfilling prophecies. With empirically-reasonable frequencies of central-bank reoptimization, the monetary-policy game has a unique Markov-perfect equilibrium wherein forward guidance influences current outcomes without displaying a forward-guidance puzzle.
Campbell, Jeffrey R.
Weber, Jacob P.
Keynesian economics; Markov processes; Money policy; Open Market Operations;
2018-09-07
The Impact of Regime Type on Food Consumption in Low Income Countries
http://d.repec.org/n?u=RePEc:hcx:wpaper:1709&r=all
Competing studies use food consumption to measure the impact of political regime on the welfare of the poor. Democracies may outperform autocracies by using growth to hide redistribution, improving caloric consumption and currying favor. Alternatively, autocracies may have greater incentives to lower food prices to quell urban unrest. We test these competing theories using a more detailed, continuous, nuanced measure of food consumption quality – cereal equivalent values. We find evidence to support the second hypothesis, that autocracies outperform democracies at low incomes. For higher incomes, democracies perform significantly better. Segregated by growth, autocracies again outperform democracies at low incomes.
Kolleen Rask
Norman Rask
food consumption, food cost, political regime, cereal equivalents
2017-12
From forward to spot prices: producers, retailers and loss averse consumers in electricity markets
http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2018-18&r=all
The benefits of smoothing demand peaks in the electricity market has been widely recognised. European countries such as Spain and some of the Scandinavian countries have recently given to the consumers the possibility to face the spot prices instead of having a fixed tariffs determined by retailers. This paper develops a theoretical model to study the relations between risk averse consumers, retailers and producers, both in the spot and in the forward markets when consumers are able to choose between fixed tariffs and the wholesale prices. The model is calibrated on a real market case - Spain - where since 2014 spot tariffs were introduced beside the flat tariffs for household consumers. Finally, simulations of agents behavior and markets performance, depending on consumers risk aversion and the number of producers, are used to analyse the implications from the model. Our results show that the quantities the retailers and the producers trade in the forward market are positively related with the loss aversion of consumers. The quantities bought by the retailers in the forward market are negatively related with the skewness of the spot prices. On the contrary, quantity sold forward by producers are positively related with the skewness of the spot prices (high probability of getting high prices increase the forward sale) and with the total market demand. In the spot market, the degree of loss aversion of consumers determine the quantity the retailers buy in the spot market but does not have a direct effect on the spot prices.
Valeria Di Cosmo
Elisa Trujillo-Baute
Electricity Spot Market, Electricity Forward Market, Risk Aversion
2018
A Promised Value Approach to Optimal Monetary Policy
http://d.repec.org/n?u=RePEc:fip:fedgfe:2018-83&r=all
This paper characterizes optimal commitment policy in the New Keynesian model using a novel recursive formulation of the central bank's infinite horizon optimization problem. In our recursive formulation motivated by Kydland and Prescott (1980), promised inflation and output gap---as opposed to lagged Lagrange multipliers---act as pseudo-state variables. Using three well known variants of the model---one featuring inflation bias, one featuring stabilization bias, and one featuring a lower bound constraint on nominal interest rates---we show that the proposed formulation sheds new light on the nature of the intertemporal trade-off facing the central bank.
Timothy S. Hills
Taisuke Nakata
Takeki Sunakawa
Commitment ; Inflation bias ; Optimal policy ; Ramsey plans ; Stabilization bias ; Zero lower bound
2018-12-03
Supervisory Stress Testing For CCPs : A Macro-Prudential, Two-Tier Approach
http://d.repec.org/n?u=RePEc:fip:fedgfe:2018-82&r=all
Stress testing has become an increasingly important mechanism to support a variety of financial stability objectives. Stress tests can be used to test the individual resilience of a single entity or to assess the system-wide vulnerabilities of a network. This article examines the role of supervisory stress testing of central counterparties (CCPs), which has emerged in recent years. A key message is that crucial differences in CCPs’ role, risk profile and financial structure, when compared to banks, are likely to require significant adaptation in the design of supervisory stress tests (SSTs). We examine how supervisory stress tests may be designed to complement CCPs' own daily stress tests, and argue that macro-prudential supervisory stress testing of CCPs is valuable for both authorities and market participants. The paper offers practical guidance on the implementation of the exercises and proposes some specific design principles that should allow authorities to extract more information from such tests. We propose a two-tier approach that meets the intended policy objectives, while balancing ambition and resource cost. The first tier encompasses more standardized tests that can be conducted frequently to assess the resilience of the clearing network over time. The second tier encompasses less frequent and more complex 'deep dive' assessments. The proposed approach should overcome operational and resource challenges, which to date, may have inhibited the widespread application of supervisory stress testing.
Edward L. Anderson
Fernando Cerezetti
Mark Manning
Central counterparties ; Financial regulation ; Macro-prudential policy ; Stress testing
2018-12-03
Factors Associated with Internal Audit Function Involvement with XBRL Implementation in Public Companies: An International Study
http://d.repec.org/n?u=RePEc:hcx:wpaper:1708&r=all
We examine the relationships of national legal system, company size, and corporate governance quality with internal audit function (IAF) involvement with eXtensible Business Reporting Language (XBRL) implementation in public companies. Our data source is The Institute of Internal Auditors' Global Internal Audit Common Body of Knowledge (CBOK) database, from which we extract responses from 692 chief audit executives (CAEs) for our investigation. We find evidence of differential effects of company size on IAF involvement with XBRL implementation, depending on the national legal system. In civil law countries, IAFs of small companies have significantly higher levels of XBRL involvement than do IAFs of large companies, whereas, in common law countries, IAFs of large companies have higher levels of involvement than do those of small companies. Finally, we find evidence that corporate governance quality is positively associated with IAF involvement with XBRL implementation.
Mohammad Abdolmohammadi
Steven DeSimone
Tien Shih Hsieh
Zhihong Wang
Internal auditorsPublic companiesXBRL implementation, common law, civil law
2017-12
Special Repo Rates and the Cross-Section of Bond Prices: the Role of the Special Collateral Risk Premium
http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-2018-21&r=all
We estimate the joint term-structure of U.S. Treasury cash and repo rates using daily prices of all outstanding Treasury securities and corresponding special collateral (SC) repo rates. This allows us to derive a risk premium associated to the SC value of Treasuries and quantitatively link this premium to various price anomalies, such as the on-the-run premium. We show that a time-varying SC risk premium can explain between 74%–90% of the on-the-run premium, and is highly correlated with a number of other Treasury market anomalies. This suggests a commonality across these price anomalies, explicitly linked to the SC value of the highest-quality securities—recently-issued U.S. nominal Treasuries.
D'Amico, Stefania
Pancost, N. Aaron
Bond prices; collateral; interest rates; risk premia
2018-12-03
POLITENESS STRATEGIES OF RUSSIAN SCHOOL STUDENTS: QUANTITATIVE APPROACH TO QUALITATIVE DATA
http://d.repec.org/n?u=RePEc:hig:wpaper:68/lng/2018&r=all
This study deals with the politeness strategies of speakers of Russian, focusing on verbal expression of politeness. After running a field survey in schools in mid-2018, we try to analyze specific verbal markers of expressing politeness quantitatively. Four such markers were selected for this study, namely greeting, leave-taking, expressing gratitude and apology. Quantitative analysis shows that there is a clear frequency pattern found in these markers’ use, indicating a relatively high degree of sociolinguistic variation. Possible causes of this effect are discussed, including cultural diversity and multilingual setting of the modern Russian school communicative domain
Maria Grabovskaya
Ekaterina Gridneva
Andrian Vlakhov
Russian, politeness, sociolinguistics, linguistic anthropology, greetings, leave-taking, gratitudes, apology
2018
Are Millennials Different?
http://d.repec.org/n?u=RePEc:fip:fedgfe:2018-80&r=all
The economic wellbeing of the millennial generation, which entered its working-age years around the time of the 2007-09 recession, has received considerable attention from economists and the popular press. This chapter compares the socioeconomic and demographic characteristics of millennials with those of earlier generations and compares their income, saving, and consumption expenditures. Relative to members of earlier generations, millennials are more racially diverse, more educated, and more likely to have deferred marriage; these comparisons are continuations of longer-run trends in the population. Millennials are less well off than members of earlier generations when they were young, with lower earnings, fewer assets, and less wealth. For debt, millennials hold levels similar to those of Generation X and more than those of the baby boomers. Conditional on their age and other factors, millennials do not appear to have preferences for consumption that differ signi ficantly from those of earlier generations.
Christopher J. Kurz
Geng Li
Daniel J. Vine
Consumption ; Balance sheets ; Generations ; Households ; Millennials ; Motor vehicles
2018-11-28
Why Does the Yield-Curve Slope Predict Recessions?
http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-2018-15&r=all
Why is an inverted yield-curve slope such a powerful predictor of future recessions? We show that a decomposition of the yield curve slope into its expectations and risk premia components helps disentangle the channels that connect fluctuations in Treasury rates and the future state of the economy. In particular, a change in the yield curve slope due to a monetary policy easing, measured by the current real-interest rate level and its expected path, is associated with an increase in the probability of a future recession within the next year. In contrast, a decrease in risk premia is associated with either a higher or lower recession probability, depending on the source of the decline. In recent years, a decrease in the inflation risk premium slope has been accompanied by a heightened risk of recession, while a lower real-rate risk premium slope is a signal of diminished recession probabilities. This means that not all declines in the yield curve slope are bad news for the economy, and not all instances of steepening are good news either.
Benzoni, Luca
Chyruk, Olena
Kelley, David
Interest rates; yield-curve slope; recession forecasts; monetary policy; bond risk premia; policy path
2018-09-28
Laboratory Evidence on the Effects of Sponsorship on the Competitive Preferences of Men and Women
http://d.repec.org/n?u=RePEc:hcx:wpaper:1608&r=all
Sponsorship programs have been proposed as one way to promote female advancement in competitive career fields. A sponsor is someone who advocates for a protégé, and in doing so, takes a stake in her success. We use a laboratory experiment to explore two channels through which sponsorship has been posited to increase advancement in a competitive workplace. In our setting, being sponsored provides a vote of confidence and/or creates a link between the protégé’s and sponsor’s payoffs. We find that both features of sponsorship significantly increase willingness to compete among men on average, while neither of these channels significantly increases willingness to compete among women on average. As a result, sponsorship does not close the gender gap in competitiveness or earnings. We discuss how these insights from the laboratory could help to inform the design of sponsorship programs in the field.
Katherine Coffman
Nancy Baldiga
2018-12
THE SHADOW OF THE FAMILY: HISTORICAL ROOTS OF SOCIAL CAPITAL IN EUROPE
http://d.repec.org/n?u=RePEc:hig:wpaper:82/soc/2017&r=all
This study provides new evidence on the impact of historic household formation patterns on present day levels of social capital (SC). We distinguish effects on bonding and bridging social capital, of which only the latter is beneficial for a society as a whole. Our results challenge the view that large household size in the past per se was responsible for institutional drawbacks of contemporary societies restricting social capital. We unveil the true processes lying behind the idea that prevalence of nuclear households fostered institutional development, testing three mechanisms through which household size may influence social capital: (a) family size in terms of the number of household members; (b) the strength of loyalty bonds within the family, and (c) generational and gendered power hierarchies within the family. Our hypotheses are explored on the basis of 26 European countries covered by the Life in Transition Survey (LiTs) in 2010. The contrast between Western and Eastern European countries in the LiTs provides a controlled environment that is free from the potentially confounding influence of European colonialism. We generate a new historical database using historical census data for 429 sub-national regions in 5 West European and 21 East European countries. Individual responses from the LiTs are attributed to the sub-national region in which the respondent lives. We find that power relations within the family have more essential consequences for contemporary values and attitudes than nuclearity/extendedness dimension. Within-family hierarchies revealed to be the strongest predictor of social capital today, indicating lower levels of bridging SC and higher level of corruption in form of monetary transfers or exchange of favors. We suggest that within-family hierarchies in the past might have affected the contemporary level of SC provoking a longstanding commitment to authority within the society. This evidence is illustrated by the significant positive correlation between the historical index of within-family hierarchy and autocracy preference as measured on LiTs data. Societal commitment to authority rooted in historical family pattern might have prevented generalized trust formation and fostered vertical patron-client relations, favoritism and corruption. Our results may drive further research from concentrating on family extendedness (nuclearity) as a predictor of the current state of modernization towards using more meaningful indicators of within-family hierarchies.
Maria Kravtsova
Aleksey Oshchepkov
Christian Welzel
historical family structure, social capital, bridging social capital, bonding social capital, corruption, modernization
2018
La brecha fiscal: estudio y aplicación a los impuestos sobre la riqueza
http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2018-15&r=all
La brecha fiscal es un concepto de importancia creciente en el ámbito de las administraciones tributarias que indica la diferencia entre la recaudación impositiva efectiva y la que debería obtenerse de haber un cumplimiento fiscal perfecto. Su estimación ofrece una información muy relevante sobre el tamaño relativo y la naturaleza del incumplimiento fiscal, así como sobre su evolución a lo largo del tiempo. En este artículo se destaca su utilidad como herramienta de gestión de la propia administración tributaria y para mejorar su rendición de cuentas ante la sociedad, señalándose también sus posibles debilidades metodológicas y las cauciones a la hora de interpretar sus resultados. Asimismo, se presenta la metodología y los resultados obtenidos al estimar la brecha fiscal de Cataluña, a partir de microdatos de los tres impuestos relacionados con la riqueza (patrimonio, sucesiones y transmisiones) más importantes que administran las comunidades autónomas españolas de régimen común. INGLÉS: The tax gap can be defined as the difference between the total amount of taxes collected by tax authorities and the total tax revenues that should be collected according to the tax code and under perfect tax compliance. The estimation of the tax gap offers very useful information about the relative size and nature of non-compliance, as well as its evolution over time. In this paper we point out that the tax gap is a valuable instrument not only to define the enforcement strategies of the tax administration but also to enhance the accountability of this public authority. Nonetheless, the methodology employed to estimate the tax gap and consequently the interpretation of the results of this assessment are subject to limitations that are discussed in the paper. Moreover, we present the methodology to estimate the tax gap in Catalonia for the three most important taxes related to wealth (wealth tax, inheritance and gift tax and transfer tax) administered by the Spanish regions and, finally, we provide the results from the estimations obtained employing microdata.
José Mª Durán-Cabré
Alejandro Esteller-Moré
Mariona Mas-Montserrat
Luca Salvadori
Tax Gap, Tax Administration, Brecha Fiscal, Administración Tributaria
2018
The Impact of Alliances in Container Shipping
http://d.repec.org/n?u=RePEc:oec:itfaac:62-en&r=all
This report assesses the impact of alliances on the maritime transport chain and its main stakeholders. Alliances have become a dominant feature of container shipping, with around 95% of the major East-West container trades covered by carriers that form part of three global alliances. The report discusses the impacts on competition and asks whether alliances bring benefits, and for whom. Finally, it presents policy options for governments based on the findings.
ITF
2018-11-02
Looking beyond the farm and household: Determinants of on-farm diversification in India
http://d.repec.org/n?u=RePEc:ind:igiwpp:2018-023&r=all
This paper analyses the factors affecting on-farm diversification decision. Notwithstanding the influence of farm and household conditions, studies have also highlighted the role of external pull factors on farm diversification. Though appraised in scholarship, this aspect has eluded an empirical scrutiny in literature. Taking India as a case, this study shows that apart from farm and household factors, there is a broader agro-ecological and structural feature which impacts on-farm diversification decision. Correcting for endogeneity in a seemingly unrelated system of ordered probit models, a "three-stage" residual inclusion model is estimated. The findings show that proximity to social infrastructure such as schools, colleges, and access to public transport matters for diversification. Results also show that though urbanization may increase demand for variety of products, it might as well impinge upon farm labor supply as non-farm opportunities also rises with urbanization. Thus, the underlying structure of the local economy also merits attention while understanding on-farm diversification process.
Varun Kumar Das
Farm diversification; Pull factors; External conditions; Residual inclusion; Economies of density; Agro-ecology; Urbanization; Structural transformation
2018-11
High dimensional semiparametric moment restriction models
http://d.repec.org/n?u=RePEc:msh:ebswps:2018-23&r=all
We consider nonlinear moment restriction semiparametric models where both the dimension of the parameter vector and the number of restrictions are divergent with sample size and an unknown smooth function is involved. We propose an estimation method based on the sieve generalized method of moments (sieve-GMM). We establish consistency and asymptotic normality for the estimated quantities when the number of parameters increases modestly with sample size. We also consider the case where the number of potential parameters/covariates is very large, i.e., increases rapidly with sample size, but the true model exhibits sparsity. We use a penalized sieve GMM approach to select the relevant variables, and establish the oracle property of our method in this case. We also provide new results for inference. We propose several new test statistics for the over-identification and establish their large sample properties. We provide a simulation study and an application to data from the NLSY79 used by Carneiro et al. [14].
Chaohua Dong
Jiti Gao
Oliver Linton
generalized method of moments, high dimensional models, moment restriction, over-identification, penalization, sieve method, sparsity.
2018
Brexit Referendum and Business Investment in the UK
http://d.repec.org/n?u=RePEc:imf:imfwpa:18/247&r=all
In this paper I apply firm-level analysis to examine how the Brexit process has affected business investment in the UK. An interaction term of potential trade costs after exiting the EU and a measure of firms’ participation in global trade is used as a proxy for firm-level exposure to Brexit-related effects. The results suggest that potential trade costs have had a considerable and statistically significant negative impact on firm investment in the UK after the referendum. At the same time, the post-referendum sterling depreciation has likely contributed positively to investment expenditure by more foreign-oriented firms.
Lucyna Gornicka
Europe;United Kingdom;Brexit referendum, firm investment, uncertainty, trade costs, General, Country and Industry Studies of Trade
2018-11-21
Modelling time-varying income elasticities of health care expenditure for the OECD
http://d.repec.org/n?u=RePEc:msh:ebswps:2018-22&r=all
Income elasticity dynamics of health expenditure is considered for the OECD and the Eurozone over the period 1995-2014. This paper studies a novel non-linear cointegration model with fixed effects, controlling for cross-section dependence and unobserved heterogeneity. Most importantly, its coefficients can vary over time and its variables can be non-stationary. The resulting asymptotic theory is fundamentally different with a faster rate of convergence to similar kernel smoothing methodologies. A fully modified kernel regression method is also proposed to reduce the asymptotic bias. Results show a steep increase in the income elasticity for the OECD and a small increase for the Eurozone.
Isabel Casas
Jiti Gao
Shangyu Xie
cross-sectional dependence, health expenditure, income elasticity, nonparametric kernel smoothing, non-stationarity, super-consistency.
2018
Collaboration in Supply Chain Management: A Resilience Perspective
http://d.repec.org/n?u=RePEc:oec:itfaab:2018/22-en&r=all
This paper investigates how collaboration between stakeholders can help make supply chains more resilient. It explores innovative ways to operate supply chains and reinforce their resilience, for instance through crowd shipping or gainsharing. The paper also includes a case study on how multi-stakeholder initiatives and public-private partnership can help foster collaboration in supply chains for increased efficiency.
Ruth Banomyong
2018-10-25
Testing for strict stationarity in a random coefficient autoregressive model
http://d.repec.org/n?u=RePEc:not:notgts:18/02&r=all
We propose a procedure to decide between the null hypothesis of (strict) stationarity and the alternative of non-stationarity, in the context of a Random Coefficient AutoRegression (RCAR). The procedure is based on randomising a diagnostic which diverges to positive infinity under the null, and drifts to zero under the alternative. Thence, we propose a randomised test which can be used directly and - building on it - a decision rule to discern between the null and the alternative. The procedure can be applied under very general circumstances: albeit developed for an RCAR model, it can be used in the case of a standard AR(1) model, without requiring any modifications or prior knowledge. Also, the test works (again with no modification or prior knowledge being required) in the presence of infinite variance, and in general requires minimal assumptions on the existence of moments.
Lorenzo Trapani
Random Coefficient AutoRegression, Stationarity, Unit Root, Heavy Tails, Randomised Tests.
Macroeconomic Effects of Japan’s Demographics: Can Structural Reforms Reverse Them?
http://d.repec.org/n?u=RePEc:imf:imfwpa:18/248&r=all
Yes, partly. This paper studies the potential role of structural reforms in improving Japan’s outlook using the IMF’s Global Integrated Monetary and Fiscal Model (GIMF) with newly-added demographic features. Implementation of a not-fully-believed path of structural reforms can significantly offset the adverse effect of Japan’s demographic headwinds — a declining and ageing population — on real GDP (by about 15 percent in the next 40 years), but would not boost inflation or contribute substantially to stabilizing public debt. Alternatively, implementation of a fully-credible structural reform program can contribute significantly to stabilizing public debt because of the resulting increase in inflation towards the Bank of Japan’s target, while achieving the same positive long-run effects on real GDP. If no reforms are implemented, severe demographic headwinds are expected to reduce Japan’s real GDP by over 25 percent in the next 40 years.
Mariana Colacelli
Emilio Fernández Corugedo
Asia and Pacific;Japan;Government expenditures and health;Structural reforms, demographics, OLG models, Forecasting and Simulation, General, General, Contracts: Specific Human Capital, Matching Models, Efficiency Wage Models, and Internal Labor Markets
2018-11-28
FFORMA: Feature-based forecast model averaging
http://d.repec.org/n?u=RePEc:msh:ebswps:2018-19&r=all
We propose an automated method for obtaining weighted forecast combinations using time series features. The proposed approach involves two phases. First, we use a collection of time series to train a meta-model to assign weights to various possible forecasting methods with the goal of minimizing the average forecasting loss obtained from a weighted forecast combination. The inputs to the meta-model are features extracted from each series. In the second phase, we forecast new series using a weighted forecast combination where the weights are obtained from our previously trained meta-model. Our method outperforms a simple forecast combination, and outperforms all of the most popular individual methods in the time series forecasting literature. The approach achieved second position in the M4 competition.
Pablo Montero-Manso
George Athanasopoulos
Rob J Hyndman
Thiyanga S Talagala
time series feature, forecast combination, XGBoost, M4 competition, meta-learning.
2018
The Economics of Regulating Ride-Hailing and Dockless Bike Share
http://d.repec.org/n?u=RePEc:oec:itfaab:2018/24-en&r=all
This paper reviews the economic case for regulating ride-hailing and dockless bikeshare. Ride-hailing has disrupted heavily regulated taxi markets and is calling much of the rationale for taxi regulation into question. It argues for light-handed regulation to enable fair, nondistorting competition across the sector. A similar approach to bikeshare is needed, though the context differs greatly. These services are creating new mobility options, while their business models are evolving rapidly. Regulators should adopt a cautious approach which minimises the risk of undermining their potential.
Rex Deighton-Smith
2018-11-26
Why is Math Cheaper than English? Understanding Cost Differences in Higher Education
http://d.repec.org/n?u=RePEc:iza:izadps:dp11968&r=all
The private return to postsecondary investment varies widely by field, but the resources required by different fields are not well known. This paper establishes five new facts about college costs using novel department-level data. First, costs vary widely across field, ranging from electrical engineering (109 percent higher costs than English) to math (22 percent lower). Costs are generally higher in fields where graduates earn more and in pre-professional programs. Second, this pattern is explained statistically by differences in class size and faculty pay, though differences in production technology enable some fields to offset higher salaries with larger classes. Third, some STEM fields experienced steep declines in expenditures over the past fifteen years while others saw increases. Fourth, increases in class size and teaching loads alongside a shift in faculty composition toward contingent faculty explain these trends. Finally, online instruction is associated with a modest reduction in cost per student, but only for undergraduate instruction. Recent policy efforts to promote enrollment in high-earning fields will thus have important implications for postsecondary costs and the social return on investment in higher education.
Hemelt, Steven W.
Stange, Kevin
Furquim, Fernando
Simon, Andew
Sawyer, John E.
college major, college costs
2018-11
The Billion Dollar Question: How Much Will it Cost to Decarbonise Cities’ Transport Systems?
http://d.repec.org/n?u=RePEc:oec:itfaab:2018/20-en&r=all
This paper puts numbers on the investment needs for urban transport infrastructure under different policy scenarios. The cities of the future will be shaped by today’s decisions about physical transport assets, and the urgent need to halt climate change makes it more important than ever to get it right. The analysis shows that a low-carbon transport system is not necessarily more expensive than today’s mobility system, and can even be more cost-efficient.
Nicolas Wagner
2018-11-09
Policy Directions for Establishing a Metropolitan Transport Authority for Korea's Capital Region
http://d.repec.org/n?u=RePEc:oec:itfaac:61-en&r=all
This report identifies the characteristics of the metropolitan transport authorities (MTAs) in the Barcelona, London and Paris areas that make them effective, and makes recommendations for the establishment of a new MTA in Korea’s capital region. It reviews governance arrangements and responsibilities for strategic planning, investment, data management, public transport services and the management of multi-modal transfer centres. Successfully managing mobility services in metropolitan areas is central to improving accessibility and to the well-being of their populations. The challenges faced include coordinating multiple government and non-government stakeholders, finding an institutional structure that meets the needs of both the urban-core and the larger commuting area, and striking a good balance between the powers of central government and local authorities. These challenges are particularly present in countries in the process of decentralisation. Successful MTAs give local authorities a prominent role in decision-making while maintaining a coherent larger scale vision in planning, policy-making and investment. Strong financial and technical capacity have proved critical.
ITF
2018-10-31
Sequential testing for structural stability in approximate factor models
http://d.repec.org/n?u=RePEc:not:notgts:18/04&r=all
We develop an on-line monitoring procedure to detect a change in a large approximate factor model. Our statistics are based on a well-known property of the (r + 1)-th eigenvalue of the sample covariance matrix of the data (having defined r as the number of common factors): whilst under the null the (r + 1)-th eigenvalue is bounded, under the alternative of a change (either in the loadings, or in the number of factors itself) it becomes spiked. Given that the sample eigenvalue cannot be estimated consistently under the null, we regularise the problem by randomising the test statistic in conjunction with sample conditioning, obtaining a sequence of i.i.d., asymptotically chi-square statistics which are then employed to build the monitoring scheme. Numerical evidence shows that our procedure works very well in finite samples, with a very small probability of false detections and tight detection times in presence of a genuine change-point.
Matteo Barigozzi
Lorenzo Trapani
large factor model, change-point, sequential testing, randomised tests.
Regional Labor Mobility in Finland
http://d.repec.org/n?u=RePEc:imf:imfwpa:18/252&r=all
This paper analyzes regional labor mobility in Finland using two complementary empirical approaches: a VAR proposed by Blanchard and Katz (1992) and a gravity model. The results point to a relatively limited regional labor mobility in Finland compared to the U.S. and to EU peers. The limited regional labor mobility is associated with persistent unemployment differentials across regions. Some impediments to regional labor mobility are exogenous, such as large geographical distances across regions and relatively sparse population density, and explain about 23 percent of the variation in labor mobility. Others can be influenced by policy, such as further increase in wage flexibiltiy and reduction of housing costs. These impediments explain about 60 percent of the variation in labor mobility. Greater regional labor mobility could help reduce regional unemployment differentials, improve job matching efficiency, and remove pressures from regional fiscal redistribution.
Tigran Poghosyan
2018-11-29
On Financing Retirement, Health, and Long-term Care in Japan
http://d.repec.org/n?u=RePEc:imf:imfwpa:18/249&r=all
Japan faces the problem of how to finance retirement, health, and long-term care expenditures as the population ages. This paper analyzes the impact of policy options intended to address this problem by employing a dynamic general equilibrium overlapping generations model, specifically parameterized to match both the macroeconomic and microeconomic level data of Japan. We find that financing the costs of aging through gradual increases in the consumption tax rate delivers a better macroeconomic performance and higher welfare for most individuals than other financing options, including those of raising social security contributions, debt financing, and a uniform increase in health and long-term care copayments.
Ellen R. McGrattan
Kazuaki Miyachi
Adrian Peralta-Alva
2018-11-28
Competition in two sided markets with congestion
http://d.repec.org/n?u=RePEc:ind:igiwpp:2018-024&r=all
Two sided markets involve two groups of agents who interact via "platforms". This paper analyses competition in a two sided market with congestion. The existing literature's on pricing mechanisms of two-sided markets has concluded that pricing mechanism depends on the following three factors: relative size of cross group externalities, fixed price or per transaction charge by platform, and single homing or multiple homing of agents. This paper extends the analysis by including the effect of congestion on pricing mechanisms in a two sided market. It concludes that in the case of single homing of agents, profits of the platform increase due to congestion if the agents have a low tolerance level, whereas in the case of multi homing, profits of the platform increase due to congestion if the agents have a high tolerance level.
Swapnil Sharma
Network externalities, Congestion
2018-11
Personal Income Tax Progressivity: Trends and Implications
http://d.repec.org/n?u=RePEc:imf:imfwpa:18/246&r=all
This paper discusses how the structure of the tax system affects its progressivity. It suggests a measure of progressive capacity of tax systems, based on the Kakwani index, but independent of pre-tax income distributions. Using this and other progressivity measures, the paper (i) documents a decline in progressivity over the last decades and (ii) examines the relationship between progressivity and economic growth. Regressions do not reveal a significant impact of progressivity on growth, suggesting that efficiency costs of progressivity may be small—at least for degrees of progressivity observed in the sample.
Claudia Gerber
Alexander D Klemm
Li Liu
Victor Mylonas
Progressive taxation;Personal income taxes;Tax systems;Income inequality;Economic growth;Progressivity; Growth; Personal Income Tax; Tax Wedge; Inequality, Progressivity, Growth, Personal Income Tax, Tax Wedge, Inequality, Household
2018-11-20
Inter-regional spillover and intra-regional agglomeration effects among local labour markets in China
http://d.repec.org/n?u=RePEc:msh:ebswps:2018-20&r=all
In this paper, we study intra-city agglomeration externality and inter-city spillover effects on productivity of 185 Chinese cities at and above the prefectural level for the years between 1995 and 2009. In particular, we investigate how a shock may be amplified or weakened by these externality effects and how productivity in a city varies with and affects that of other cities in the economy. We estimate the impacts of population size on productivity in 185 Chinese cities using spatial fixed-effect panel data models. Both the endogenous and exogenous spatial dependence are allowed for. The direct and indirect effects of the factors are calculated and compared for various city groups. We find that a significant positive effect of urban population on the real wage levels, which confirms the existence of agglomeration economy within regions. We also find significant differences in both the direct and indirect effect of factors such as FDI between more and less population dense areas. This seems to suggest that agglomeration economy may also exist among regions. Disparity between regions in economic growth and productivity could be explained by the statistically significant regional variations in the direct and indirect effects.
Xiaodong Gong
Jiti Gao
Xuan Liang
Xin Meng
2018
Insights from behavioral economics on current policy issues
http://d.repec.org/n?u=RePEc:ind:igiwpp:2018-022&r=all
The paper examines behavioral constraints in policy-making and in achieving coordination across policies. First it applies psychological concepts to understand policy inadequacies, and next examines how general reforms or better coordination can be achieved using psychological trigger strategies.
Ashima Goyal
Indian policy; Behavioural constraints; Psychological trigger strategies
2018-10
International Migration and the Distribution of Income in New Zealand Metropolitan and Non-Metropolitan Areas
http://d.repec.org/n?u=RePEc:iza:izadps:dp11959&r=all
Since the 1980s, income inequality in New Zealand has been a growing concern - particularly in metropolitan areas. At the same time, the encouragement of permanent and temporary immigration has led to the foreign-born accounting for a growing share of the population; this is disproportionally so in metropolitan areas. This paper investigates the impact of immigration, by skill level and length of stay, on the distribution of income in metropolitan and non-metropolitan areas. We apply decomposition methodologies to data obtained from the 1986, 1991, 1996, 2001, 2006 and 2013 Censuses of Population and Dwellings. We find that increases in the immigrant share of population in an area have an inequality-increasing and area-specific effect. Changes in immigrant-group-specific distributions of income are inequality reducing in non-metropolitan areas but inequality increasing in metropolitan areas. Inequality increased in metropolitan areas because the overall inequality-increasing effect of immigration is larger than the inequality-reducing changes for the New Zealand-born. The opposite is the case in non-metropolitan areas: the overall inequality-reducing change in the income distribution of the New Zealand born there is larger than the inequality-increasing effect of immigration. The methodologies adopted here can also benefit the study of income distribution changes in countries with similar immigration policies, such as Australia and Canada.
Alimi, Omoniyi
Maré, David C.
Poot, Jacques
New Zealand, income inequality, international migration, metropolitan areas, decomposition methods
2018-11
Regulatory Capacity Building: Tools for Analysing Rail Connectivity
http://d.repec.org/n?u=RePEc:oec:itfaac:63-en&r=all
This report reviews methods adopted in the United States and Canada for determining fairness and efficiency in rail markets and discusses their potential application in Mexico. It specifically examines how waybill and financial data are used in the economic regulation of railways and makes recommendations for establishing a data collection and analysis system suited to the Mexican railway system. Mexico has transformed its loss-making national railway into profitable concessions that have invested in infrastructure and carry growing volumes of freight. Some of the provisions agreed in the concession titles regarding interconnection and competition on specific links have not, however, developed as expected. A new regulatory agency was established in 2016/17 to address this and establish the capacity for the government to intervene effectively where necessary. A top priority for the Agencia Reguladora del Transporte Ferroviario de México is to develop a data collection and analysis system to understand rail markets in relation to issues of potential abusive pricing and reasonable conditions of access.
ITF
2018-11-08
Decoupling the EU ETS from subsidized renewables and other demand side effects Lessons from the impact of the EU ETS on CO2 emissions in the German electricity sector
http://d.repec.org/n?u=RePEc:mar:magkse:201835&r=all
This paper analyzes the impact of the EU ETS on CO2 reduction in the German electricity sector. We find an ETS-induced emission abatement which is not exceeding 6 % of total emissions with a maximum already in 2010. Thereafter the ETS has not induced additional reductions. This outcome is sub-optimal. It corresponds to the recent debate about sub-optimal performance of the EU ETS caused by excessive allowances. Following up on this we develop a unilateral flexible cap to eliminate demand side effects which lead to excessive allowances. The unilateral flexible cap is based on emission intensities. Using the works of Newell and Pizer (2008); Sue Wing et al. (2009) we prove in a first step that an intensity-based emission cap is advantageous in the German electricity sector when compared to an absolute cap. An ex-post analysis shows that the amount of excessive allowances resulting from the economic crisis during the second trading period could have been significantly lowered with a unilateral flexible cap. This approach also decouples the EU ETS from a simultaneous promotion of renewable energy.
Sebastian Schaefer
Decoupling Overlapping Regulations, Promotion of Renewable Energy, Emissions Trading, Intensity Standard
2018
China’s Monetary Policy Communication: Frameworks, Impact, and Recommendations
http://d.repec.org/n?u=RePEc:imf:imfwpa:18/244&r=all
Financial markets are eager for any signal of monetary policy from the People’s Bank of China (PBC). The importance of effective monetary policy communication will only increase as China continues to liberalize its financial system and open its economy. This paper discusses the country’s unique institutional setup and empirically analyzes the impact on financial markets of the PBC’s main communication channels, including a novel communication channel. The results suggest that there has been significant progress but that PBC communication is still evolving toward the level of other major economies. The paper recommends medium-term policy reforms and reforms that can be adopted quickly.
Michael McMahon
Alfred Schipke
Xiang Li
Financial markets;Central banks and their policies;Asia and Pacific;Monetary policy;People’s Bank of China, Communication, Central Bank, Monetary Policy Transmission, People’s Bank of China, Monetary Policy (Targets, Instruments, and Effects), General
2018-11-16
Surface Access to Airports: The Case of Mexico City's New International Airport
http://d.repec.org/n?u=RePEc:oec:itfaac:60-en&r=all
The success of Mexico City’s New International Airport will depend not least on the quality of access to the airport on the ground. This report reviews policies and planning controls for surface access at a selection of comparable airports in cities of OECD countries. It offers input for the Mexican Federal Government’s plans for infrastructure investments that will serve passengers, the airport workforce and the public by ensuring convenient, reliable airport journeys; supporting business travel for a productive Mexican economy; and by maintaining within acceptable bounds the airport’s impact on road congestion and related air pollution.This report was prepared in collaboration with the OECD’s Directorate for Public Governance.
ITF
2018-10-26
Economic Behavior of Children and Adolescents - A First Survey of Experimental Economics Results
http://d.repec.org/n?u=RePEc:iza:izadps:dp11947&r=all
About 15 years ago, economic experiments with children and adolescents were considered as an extravagant niche of economic research. Since then, this type of research has exploded in scope and depth. It has become clear that studying the development of economic behavior and its determinants is important to understand economic behavior of adults and to provide a basis for potential policy interventions with respect to economic behavior in childhood and adolescence. Given the huge increase of papers, we provide the first overview of economic experiments with children and adolescents. We focus on the following aspects: rationality of choices, risk preferences, time preferences, social preferences, cooperation, and competitiveness. All of these aspects are analyzed with respect to the influence of age and gender, and we also consider the role of socio-economic status or interventions.
Sutter, Matthias
Zoller, Claudia
Glätzle-Rützler, Daniela
competitiveness, risk preferences, time preferences, social preferences, survey, experiment, children, gender, age
2018-12
Time-varying spectral analysis: Theory and applications
http://d.repec.org/n?u=RePEc:ind:igiwpp:2018-025&r=all
Non-stationary time series are a frequently observed phenomenon in several applied fields, particularly physics, engineering and economics. The conventional way of analysing such series has been via stationarity inducing filters. This can interfere with the intrinsic features of the series and induce distortions in the spectrum. To avert this possibility, it might be a better alternative to proceed directly with the series via the so-called time-varying spectrum. This article outlines the circumstances under which such an approach is possible, drawing attention to the practical applicability of these methods. Several methods are discussed and their relative advantages and drawbacks delineated.
D.M. Nachane
Non-stationarity, mixing conditions, oscillatory processes, evolutionary spectrum, ANOVA, decoupling
Populism and Civil Society
http://d.repec.org/n?u=RePEc:imf:imfwpa:18/245&r=all
Populists claim to be the only legitimate representative of the people. Does it mean that there is no space for civil society? The issue is important because since Tocqueville (1835), associations and civil society have been recognized as a key factor in a healthy liberal democracy. We ask two questions: 1) do individuals who are members of civil associations vote less for populist parties? 2)does membership in associations decrease when populist parties are in power? We answer thesequestions looking at the experiences of Europe, which has a rich civil society tradition, as well as of Latin America, which already has a long history of populists in power. The main findings are that individuals belonging to associations are less likely by 2.4 to 4.2 percent to vote for populist parties, which is large considering that the average vote share for populist parties is from 10 to 15 percent. The effect is strong particularly after the global financial crisis, with the important caveat that membership in trade unions has unclear effects.
Tito Boeri
Prachi Mishra
Chris Papageorgiou
Antonio Spilimbergo
Political economy;Voting;Europe;Democracy, populist parties, associations, Latin America
2018-11-16
Inland Waterways, Transport Corridors and Urban Waterfronts
http://d.repec.org/n?u=RePEc:oec:itfaab:2018/21-en&r=all
This paper analyses the opportunities and challenges of integrating inland waterways into transport corridors. Less than a fifth of the world’s 623 000 kilometres of navigable inland waterways is currently used for freight transport. Although river transport has expanded in some countries, it is actually declining in others due to lagging investments or co-ordination. At the same time, urban development is encroaching on inland ports, reducing the space for logistics activities in many river ports, creating challenges for policy makers.
Antoine Beyer
2018-10-31
Fiscal Stimulus Impact on Firms' Profitability During the Global Financial Crisis
http://d.repec.org/n?u=RePEc:imf:imfwpa:18/251&r=all
Using financial statement data from the Thomson Reuter’s Worldscope database for 22,333 non-financial firms in 52 advanced and emerging economies, this paper examines how fiscal stimulus (i.e., changes in structural deficit) interacted with sectoral business cycle sensitivity affected corporate profitability during the recovery period of the global financial crisis (GFC). Using cross-sectional analyses, our findings indicate that corporate profitability improved significantly after the GFC fiscal stimulus, especially in manufacturing, utilities and retail sectors. Firm size and leverage are also found to be significant in explaining changes in corporate profitability.
Carolina Correa-Caro
Leandro Medina
Marcos Poplawski-Ribeiro
Bennett W Sutton
2018-11-28
Regime switching in the presence of endogeneity
http://d.repec.org/n?u=RePEc:msh:ebswps:2018-9&r=all
In this paper, we propose a state-varying endogenous regime switching model (the SERS model), which includes the endogenous regime switching model by Chang et al. (2017), the CCP model, as a special case. To estimate the unknown parameters involved in the SERS model, we propose a maximum likelihood estimation method. Monte Carlo simulation results show that in the absence of state-varying endogeneity, the SERS model and the CCP model have similar performance, while in the presence of state-varying endogeneity, the SERS model performs much better than the CCP model. Finally, we use the SERS model to analyze the China stock market returns and our empirical results show that there exists strongly state-varying endogeneity in volatility switching for the Shanghai Composite Index returns. Moreover, the SERS model can indeed produce a much more realistic assessment for the regime switching process than the one obtained by the CCP model.
Tingting Cheng
Jiti Gao
Yayi Yan
latent factor, maximum likelihood estimation, Markov chain, regime switching models, state-varying endogeneity.
2018
Public Transport Governance in Greater Barcelona
http://d.repec.org/n?u=RePEc:oec:itfaab:2018/23-en&r=all
This paper describes the role of the Metropolitan Area of Barcelona (AMB) in the governance of public transport in Spain’s second-largest agglomeration. It sets out how the AMB is able to provide integrated transport management, planning, financing and decision-making across different administrations and bodies of the Barcelona region, based on a mandate that comprises territorial planning, environment and sustainability, housing, economic development and social cohesion.
Frederic Lloveras Minguell
2018-10-30
China’s Rebalancing: Recent Progress, Prospects and Policies
http://d.repec.org/n?u=RePEc:imf:imfwpa:18/243&r=all
While China’s growth gathered momentum in 2017, rebalancing was uneven and decelerated along many dimensions reflecting the temporary factors behind the growth pickup. Going forward, rebalancing is expected to proceed as these temporary factors recede, but elevated income inequality and leverage will remain a challenge. The authorities are already pursuing several pro-rebalancing policies which could be expanded to support each dimension of rebalancing while reducing trade-offs between them.
Rui Mano
Jiayi Zhang
2018-11-12
Tranformation of Indian agriculture: Growth, iclusiveness and sustainability
http://d.repec.org/n?u=RePEc:ind:igiwpp:2018-026&r=all
There are three goals of agricultural development in India. These are: (a) achieving high growth by raising productivity; (b) inclusiveness by focusing on lagging regions, small farmers and women; and (c) sustainability of agriculture. In this paper, we will address two questions: (a) How far India progressed in the three goals of agriculture in recent decades? (b) What are the policies and reforms needed to transform Indian agriculture in the next decade? This paper provides 10 conclusions on the policies needed to achieve three goals of agricultural development in India. These are : (1) There is a need for change in the narrative in the new context; (2) Global trends and macro policies are equally important for Indian agriculture; (3) We have to walk on two legs both agriculture and non-agriculture. There is a need to shift from cereal based agriculture to non-cereal based crops and allied activities; (4) Doubling farm income also has to focus non-farm sector, look at different size classes and environmental considerations; (5) Remunerative prices and market reforms can enhances farmers' incomes; (6) The country has to go beyond harvest and give freedom for farmers on markets and exports; (7) Do not foreget basics like water and technology; (8) Inclusiveness is needed for board based growth and equity. Focus on small and maginal farmers, women, youth, rainfed areas, Eastern and other lagging regions, social groups like SC and ST farmers; (9) Measures have to be taken to take care of impacs of climate change and improving resilience in agriculture and sustainability; (10) Strengthening institutions and governance is crucial for achieving growth, equality and sustainability of agriculture.
S. Mahendra Dev
Agricultural growth, inclusiveness, sustainability, prices, water, technology, small farmers, nutrition and climate change
2018-12
Regime switching panel data models with interative fixed effects
http://d.repec.org/n?u=RePEc:msh:ebswps:2018-21&r=all
In this paper, we introduce a regime switching panel data model with interactive fixed effects. We propose a maximum likelihood estimation method and develop an expectation and conditional maximization algorithm to estimate the unknown parameters. Simulation results show that the algorithm works well in finite samples. The biases of the maximum likelihood estimators are negligible and the root mean squared errors of the maximum likelihood estimators decrease with the increase of either cross-sectional units N or time periods T.
Tingting Cheng
Jiti Gao
Yayi Yan
ECM algorithm, interactive effect, maximum likelihood estimation, panel data model, regime switching.
2018
Testing for randomness in a random coefficient autoregression model
http://d.repec.org/n?u=RePEc:not:notgts:18/03&r=all
We propose a test to discern between an ordinary autoregressive model, and a random coefficient one. To this end, we develop a full- edged estimation theory for the variances of the idiosyncratic innovation and of the random coefficient, based on a two-stage WLS approach. Our results hold irrespective of whether the series is stationary or nonstationary, and, as an immediate result, they afford the construction of a test for "relevant" randomness. Further, building on these results, we develop a randomised test statistic for the null that the coefficient is non-random, as opposed to the alternative of a standard RCA(1) model. Monte Carlo evidence shows that the test has the correct size and very good power for all cases considered. MSC 2010 subject classifications: Primary 62G10, 62H25; secondary 62M10.
Lajos Horvath
Lorenzo Trapani
Random Coefficient AutoRegression, WLS estimator, randomised test.
Indian banks and the prevention of corruption Act: Freedom and discipline
http://d.repec.org/n?u=RePEc:ind:igiwpp:2018-021&r=all
Selfless activists like Mr. Pai teach us the importance of continuously interrogating the functioning of our democracy. The NPA issue has persisted for almost a decade. It has eroded the profitability of banks, and is a problem for depositors, although sovereign guarantee mitigates concerns. Since large infrastructure loans were made to private firms, there were fears of private enrichment at the expense of the tax-payer. The institutions to curb corruption were geared to a control regime, and in the post-reform market-based system did not make the crucial distinction between crime and risk-taking. Their actions paralyzed decision-making and delayed resolution. The Prevention of Corruption Act has recently been amended, but partly because the differing requirements of a control and market-based system are not well-understood some have criticized it as being too soft on corruption while others see it as continuing to hurt decision-making. After examining the combination of discipline and freedom a market-based system requires we assess the 2018 amendment on those criteria. We also more broadly examine changes in incentives and social norms that are likely to reduce corruption as well as resolution delays.
Ashima Goyal
Public sector banks, Non-performing Assets, Prevention of Corruption Act
2018-09
Determining the dimension of factor structures in non-stationary large datasets
http://d.repec.org/n?u=RePEc:not:notgts:18/01&r=all
We propose a procedure to determine the dimension of the common factor space in a large, possibly non-stationary, dataset. Our procedure is designed to determine whether there are (and how many) common factors (i) with linear trends, (ii) with stochastic trends, (iii) with no trends, i.e. stationary. Our analysis is based on the fact that the largest eigenvalues of a suitably scaled covariance matrix of the data (corresponding to the common factor part) diverge, as the dimension N of the dataset diverges, whilst the others stay bounded. Therefore, we propose a class of randomised test statistics for the null that the p-th eigenvalue diverges, based directly on the estimated eigenvalue. The tests only requires minimal assumptions on the data, and no restrictions on the relative rates of divergence of N and T are imposed. Monte Carlo evidence shows that our procedure has very good finite sample properties, clearly dominating competing approaches when no common factors are present. We illustrate our methodology through an application to US bond yields with different maturities observed over the last 30 years. A common linear trend and two common stochastic trends are found and identified as the classical level, slope and curvature factors.
Matteo Barigozzi
Lorenzo Trapani
House Price Synchronicity, Banking Integration, and Global Financial Conditions
http://d.repec.org/n?u=RePEc:imf:imfwpa:18/250&r=all
We examine the relationship between house price synchronicity and global financial conditions across 40 countries and about 70 cities over the past three decades. The role played by cross-border banking flows in residential property markets is examined as well. Looser global financial conditions are associated with greater house price synchronicity, even after controlling for bilateral financial integration. Moreover, we find that synchronicity across major cities may differ from that of their respective countries’, perhaps due to the influence of global investors on local house price dynamics. Policy choices such as macroprudential tools and exchange rate flexibility appear to be relevant for mitigating the sensitivity of domestic housing markets to the rest of the world.
Adrian Alter
Jane Dokko
Dulani Seneviratne
2018-11-28
Cross-temporal coherent forecasts for Australian tourism
http://d.repec.org/n?u=RePEc:msh:ebswps:2018-24&r=all
Key to ensuring a successful tourism sector is timely policy making and detailed planning. National policy formulation and strategic planning requires long-term forecasts at an aggregate level, while regional operational decisions require short-term forecasts, relevant to local tourism operators. For aligned decisions at all levels, supporting forecasts must be `coherent', that is they should add up appropriately, across relevant demarcations (e.g., geographical divisions or market segments) and also across time. We propose an approach for generating coherent forecasts across both cross-sections and planning horizons for Australia. This results in significant improvements in forecast accuracy with substantial decision making benefits. Coherent forecasts help break intra- and inter-organisational information and planning silos, in a data driven fashion, blending information from different sources.
Nikolaos Kourentzes
George Athanasopoulos
cross-sectional aggregation, temporal aggregation, forecast combinations, spatial correlations.
2018
Private School Usage in Australia 1975 - 2010: Evidence from the Household Expenditure Surveys
http://d.repec.org/n?u=RePEc:acb:cbeeco:2018-664&r=all
The use of private schools in Australia has increased greatly. This paper shows that most of the growth has been concentrated in using low-fee schools, while the growth in using high-fee schools has been modest. Furthermore, the increase has occurred for both two-parent and single-parent households and for households at all income levels. However, increasing income and changes household composition can account only for a small part of the trend.
Tue Gorgens
Chris Ryan
Guochang Zhao
2018-12
Attention please!
http://d.repec.org/n?u=RePEc:zur:econwp:308&r=all
We study the impact of manipulating the attention of a decision-maker who learns sequentially about a number of items before making a choice. Under natural assumptions on the decision-maker's strategy, forcing attention toward one item increases its likelihood of being chosen.
Olivier Gossner
Jakub Steiner
Colin Stewart
Sequential sampling, marketing, persuasion, attention allocation
2018-11
Effects of timing and reference frame of feedback: Evidence from a field experiment
http://d.repec.org/n?u=RePEc:zbw:wzbmbh:spii2018206&r=all
Information about past performance has been found to sometimes improve and sometimes worsen subsequent performance. Two factors may help to explain this puzzle: which aspect of one's past performance the information refers to and when it is revealed. In a field experiment in secondary schools, students received information about their absolute rank in the last math exam (level feedback), their change in ranks between the second-last and the last math exam (change feedback), or no feedback. Feedback was given either 1-3 days (early) or immediately (late) before the final math exam of the semester. Both level feedback and change feedback significantly improve students' grades in the final exam when given early and tend to worsen them when given late. The largest effects are found for negative change feedback and are concentrated on male students, who adjust their ability beliefs downwards in response to feedback.
Fischer, Mira
Wagner, Valentin
timing of feedback,change and level feedback,motivation,field experiment
2018
Adaptation to Shocks and The Role of Capital Structure: Danish Exporters During the Cartoon Crisis
http://d.repec.org/n?u=RePEc:aah:aarhec:2018-12&r=all
How do firms’ responses to an unexpected demand shock vary with their capital structure? We study the boycott of Danish products in Muslim countries in response to a Danish newspaper publishing caricatures of prophet Muhammad. Using detailed firm data on financial statements, trade flows, product innovation, and outsourcing activities of Danish exporters, we exploit variation in their capital structure and exposure to Muslim countries to analyze the effect of leverage on their response to the boycott in input and output markets. We find that firms with low leverage compensate for lost demand by increasing investment, introducing new products and redirecting their sales elsewhere. In contrast, high leverage firms reduce sales, employment and investment and substitute employees with outsourcing and owning assets with leasing. This focus on short-term cost savings is consistent with indirect costs of financial distress borne away from bankruptcy in the form of constrained adjustment to changing demand.
Benjamin U. Friedrich
Michal Zator
2018-12-12
Does persistence in internationalization and innovation influence firms’ performance?
http://d.repec.org/n?u=RePEc:zbw:esprep:189680&r=all
In this paper, we analyze the joint effect of persistency in innovation and export on firms’ total factor productivity (measured in accordance with Levinsohn and Petrin, 2003). For this purpose, we use data on Italian manufacturing firms covering an eight-year time span (1998-2006) which allow us to measure the effect of different time activities, both in innovation and in export and the existence of different pathways linking them. We distinguish between persistent and temporary exporting firms as well as frequent and temporary innovators, to test (through OLS and a two-step system GMM) the existence of any combined learning-by-exporting and learning-by-doing effects. We find that persistent innovation efforts seem to be associated with a permanent presence in foreign markets since persistently innovative and exporting firms have better productivity results than persistently exporting (innovating) firms with no persistent innovation (export). Combining both strategies can be an opportunity to internalize knowledge flows coming from long-lasting exposure to foreign markets.
Iandolo, Stefano
Ferragina, Anna Maria
Export,Innovation,Firms,Productivity,GMM
2018
Intra-individual and crossover effects of work contact in leisure time on satisfaction with work-life balance
http://d.repec.org/n?u=RePEc:zbw:wsidps:210&r=all
Using data from the 2015/2016 German Family Panel (pairfam), this article examines the intra-individual and crossover effects of work contact in leisure time on satisfaction with work-life balance. Results of mediation analyses show that individuals who have work contact in leisure time are less satisfied with their work-life balance because of the (perceived) obligation to be available after work hours. Partners, by contrast, are less satisfied with work-life balance only when the other partner actually has work contact in leisure time. The negative association between work contact/availability and satisfaction with work-life balance is mediated in both partners by work-home conflict.
Lott, Yvonne
2018
Die Finanzen der Bundesagentur für Arbeit: Rückblick und Ausblick
http://d.repec.org/n?u=RePEc:zbw:ifwkpb:119&r=all
Ausgangspunkt der Analyse ist die für Anfang 2019 vorgesehene Senkung des Beitragssatzes in der Arbeitslosenversicherung von 3,0 auf 2,5 Prozent. Der Autor stellt dar, dass die Ausgaben für die Weiterbildung der Beschäftigten erhöht werden und das Arbeitslosengeld unter erleichterten Voraussetzungen gezahlt wird. Er zeigt, dass auf diese Weise der strukturelle Überschuss der Bundesagentur für Arbeit beseitigt wird. Gleichzeitig werden die Rücklagen der Bundesagentur weiter steigen, wobei die Verzinsung der allgemeinen Rücklage der Bundesagentur (Ende 2018: 23,3 Mrd. Euro) sowohl im Jahr 2019 als auch im Jahr 2020 wohl 0,0 Prozent betragen wird. Der Autor hält eine weitere Beitragssatzsenkung angesichts der extrem hohen Rücklage für angebracht.
Boss, Alfred
Arbeitslosenversicherung,Beitragssatzsenkung,Budgetüberschuss,Sozialversicherung
2018
Masters and slaves: A matching approach with heterogeneous workers
http://d.repec.org/n?u=RePEc:zbw:roswps:159&r=all
At present, most countries have officially ratified the ILO Convention concerning forced or compulsory labor; however, serfdom is still present in the twenty-first century. This paper addresses the questions of how situations of modern slavery arise and how oppressors select their victims. The analytical framework is a labor-market model in which masters and slaves are matched via a matching function. In contrast to the standard matching model, not the workers exert effort to find jobs but the employers exert effort to find and hire slaves. Workers are heterogeneous regarding their "slavability", which is ex-ante unknown to the potential employers. Employers exert effort to recruit slaves. The employer's decision whether and to what extent to engage in forced labor depends on governmental labor protection and on the probability of detection. Moreover, the model includes the possibility of bribery such that an employer can avoid sanctions if illicit behavior is detected. The model is solved and the impact of policy variables and other exogenous parameters on the firms' activities are investigated.
Willert, Bianca
Coerced Labor,Modern Slavery,Matching
2018
Transition des études au marché du travail : Une étape aussi difficile pour tous les groupes d’âge ?
http://d.repec.org/n?u=RePEc:oec:eduaag:54-fr&r=all
La transition des études à la vie active peut être une étape difficile, parfois marquée par des périodes de chômage. Les données montrent que les jeunes qui quittent le système éducatif précocement ont un niveau de compétence et de formation comparativement faible, et rencontrent les plus grandes difficultés sur le marché du travail par rapport à leurs pairs restés scolarisés plus longtemps. Des efforts doivent être consentis afin de garantir une scolarisation pour tous au moins jusqu’à l’obtention d’un diplôme du deuxième cycle du secondaire – souvent considéré comme le seuil minimum à atteindre pour réussir son entrée sur le marché du travail. Rester scolarisé permet non seulement d’élever son niveau de formation, mais aussi de développer les compétences nécessaires à une transition réussie vers le marché du travail.
OCDE
2018-12-18
Giving once, giving twice: A two-period field experiment on intertemporal crowding in charitable giving
http://d.repec.org/n?u=RePEc:zbw:wzbeoc:spii2017305r2&r=all
We study intertemporal crowding between two fundraising campaigns for the same charitable organization by manipulating donors’ beliefs about the likelihood of future campaigns in two subsequent field experiments. The data shows that initial giving is decreasing in the likelihood of a future campaign while subse-quent giving increases in initial giving. While this refutes the predictions of a simple expected utility model, the pattern is in line with a model that allows for (anticipated or unanticipated) habit formation provided that donations in the two periods are substitutes.
Adena, Maja
Huck, Steffen
Charitable giving,field experiments,intertemporal crowding
2018
Ludwik Fleck's philosophy and sociology of science and the resilience of modern neoclassical economics: A case study
http://d.repec.org/n?u=RePEc:zbw:cessdp:70&r=all
[Introduction] Ludwik Fleck’s contribution to the sociology and philosophy of science has gone almost unnoticed to the present day (see Sady 2017). Although his ideas about the development of scientific knowledge as a collective effort organised in ‘thought collectives’ (‘Denkkollektive’) based on shared ‘thought styles’ (‘Denkstile’) may have been elaborated and honed in Thomas S. Kuhn’s works on scientific revolutions and paradigm shifts and those of Imre Lakatos on scientific research programs (srp), Fleck’s work is still insightful beyond Kuhn’s and Lakatos’ contributions, not so much with respect to what triggers scientific progress but rather what impedes the correction of scientific deceptions. While Kuhn and Lakatos built on the rationality of the scientific community not to follow paradigmatic lines or adhere to scientific research programs defeated by empirical falsification or the proof of logical inconsistency or having entered the ‘state of degeneration’, Fleck was more concerned with the sociological forces that explain the resilience of ideas and what today we would call ‘fake knowledge’ even in the face of mounting evidence that does not fit the established wisdom. In the following, Fleck’s philosophy and sociology of science will be briefly outlined in order to establish a ‘theory of the resilience of scientific misapprehension’. This theory will be tested against the development of modern neoclassical economics by singling out a case of extreme deviation of theoretical prediction from empirical evidence: minimum wages’ impact on employment.
Heise, Arne
2018
How Enhancing ICT has affected Inequality in Africa for Sustainable Development: An Empirical Investigation
http://d.repec.org/n?u=RePEc:afe:wpaper:18/045&r=all
This study examines if enhancing ICT reduces inequality in 48 countries in Africa for the period 2004-2014. Three inequality indictors are used, namely, the: Gini coefficient, Atkinson index and Palma ratio. The adopted ICT indicators include: mobile phone penetration, internet penetration and fixed broadband subscriptions. The empirical evidence is based on the Generalised Method of Moments. Enhancing internet penetration and fixed broadband subscriptions have a net effect on reducing the Gini coefficient and the Atkinson index, whereas increasing mobile phone penetration and internet penetration reduces the Palma ratio. Policy implications are discussed in the light of challenges to Sustainable Development Goals.
Simplice A. Asongu
Nicholas M. Odhiambo
ICT; Inclusive development; Africa; Sustainable development
2018-09
Ambivalente Flexibilität: Crowdworker*innen zwischen selbstbestimmter Arbeit und kapitalistischer (Selbst-)Verwertung auf digitalen Plattformen
http://d.repec.org/n?u=RePEc:zbw:udesoz:201803&r=all
Crowdwork ist eine neuartige Form der Arbeitsorganisation, bei der Unternehmen, Organisationen oder Einzelpersonen Arbeitsaufträge verschiedener Art über spezielle digitale Plattformen an unbekannte Auftragnehmer*innen vegeben, welche diese selbstselektiv annehmen und gegen Entgelt die jeweiligen Arbeitsleistungen erbringen. Im Artikel werden die Ergebnisse einer selbst durchgeführten qualitativen Untersuchung präsentiert, welche auf einen ambivalenten Charakter der digitalen Plattform-Arbeit für die arbeitenden Subjekte schließen lassen. So haben Subjekte, die auf digitalen Plattformen arbeiten, besondere Flexibilitäts- und Autonomieansprüche an ihre Erwerbstätigkeit, welche sie in Crowdwork als bereits realisiert antizipieren, und reagieren gerade deshalb verstärkt mit Selbstrationalisierungs- und Anpassungsleistungen auf die Arbeitsanforderungen auf digitalen Plattformen. Die tatsächlich eröff-neten Handlungsspielräume digitaler Plattform-Arbeit schlagen so in ein Instrument effizienterer - weil internalisierter und auf sich selbst angewendeter - Arbeitskraftausbeutung um.
Gajewski, Eltje
Crowdwork,digitale Plattform-Arbeit,Flexibilisierung von Arbeit,Subjektivierung von Arbeit,crowd work,digital work,online outsourcing,digital platforms,work flexibility
2018
Der Preis der Energiewende: Anstieg der Kostenbelastung einkommensschwacher Haushalte
http://d.repec.org/n?u=RePEc:zbw:rwimat:128&r=all
Seit dem Jahr 2000 haben sich die Strompreise für private Haushalte mehr als verdoppelt. Von steigenden Stromkosten sind Millionen von armutsgefährdeten Haushalten besonders betroffen, weil diese Kosten regressive Wirkungen haben: Arme Haushalte haben einen größeren Anteil ihres Einkommens zur Finanzierung ihres Energiebedarfs aufzuwenden als wohlhabende Haushalte. Vor diesem Hintergrund untersucht der vorliegende Beitrag exemplarisch für einige Haushaltstypen mit geringem Einkommen, wie stark ihre Stromkostenbelastung in den Jahren 2006 bis 2016 relativ zu ihrem Einkommen zugenommen hat. Nach unseren Abschätzungen auf Basis empirischer Daten zum Energieverbrauch privater Haushalte mussten die von uns betrachteten armutsgefährdeten Haushaltstypen im Jahr 2016 allesamt mehr für Strom ausgeben als zur Deckung ihres Energiebedarfs zum Heizen und zur Warmwassererzeugung. Es muss davon ausgegangen werden, dass im Zuge der Energiewende der Strompreis auch in den kommenden Jahren weiter steigen wird. Dies gilt insbesondere angesichts der stark gestiegenen Preise für Emissionszertifikate, die sich in der Steigerung der Börsenstrompreise bemerkbar machen. Damit stellt sich immer drängender die Frage nach Maßnahmen zur Abschwächung von weiteren Strompreisanstiegen und zur sozialen Abfederung ihrer regressiven Wirkungen.
Frondel, Manuel
Sommer, Stephan
Regressive Wirkungen,Kostenverteilung,Akzeptanz
2018
Nachhaltiges Landmanagement vor dem Hintergrund des Klimawandels als Aufgabe der räumlichen Planung: Eine Evaluation im planerischen Mehrebenensystem an den Beispielen der Altmark und des Landkreises Lüchow-Dannenbergs
http://d.repec.org/n?u=RePEc:zbw:jhtire:61&r=all
Die Ressource Fläche ist weltweit begrenzt. Ein nachhaltiges Landmanagement ist, nicht nur vor dem Hintergrund des Klimawandels, erforderlich, um den verschiedenen Interessen an der Fläche gerecht zu werden. Bestehende Funktionen auf der Fläche, beispielsweise die Produktion von Nahrungsmitteln oder Rohstoffen sowie die Sicherung von Gewerbe- und Siedlungsgebieten unter Beachtung des Schutzes der Biodiversität, sind unter Anbetracht des Klimawandels zu sichern. Klimaschutzmaßnahmen wie der Schutz und die Entwicklung von Treibhausgassenken, beispielsweise Moore und Wälder, müssen neben Klimaanpassungsmaßnahmen, wie Hochwasserschutzflächen, mit den bestehenden Anforderungen an die Fläche vereint werden. Die räumliche Planung, so der Ausgangspunkt der Dissertation, kann durch die sektorübergreifende Betrachtung bei einem nachhaltigen Landmanagement vor dem Hintergrund des Klimawandels eine zentrale Aufgabe übernehmen. Die vorliegende Arbeit definiert räumliche Planung als formelle Raumordnung und informelle Raumentwicklung. Demnach umfasst räumliche Planung neben formellen planerischen Prozessen im Mehrebensystem der Raumplanung auch informelle planerische Strukturen und Prozesse. Ziel der räumlichen Planung ist es, Abwägungsprozesse zwischen den verschiedenen Interessen an einem Raum durchzuführen und damit Flächeninanspruchnahmen zu koordinieren. Durch das Mehrebenensystem der räumlichen Planung werden auf den verschiedenen Verwaltungsebenen planerische Festlegungen getroffen und in die nächste Ebene übertragen, konkretisiert oder als Grundlage verwendet. In diesem Gegenstromprinzip arbeitet die räumliche Planung auf verschiedener Maßstabsebene. Die räumliche Planung strebt in ihrem Ursprungsgedanken eine interessensabgewogene Raumgestaltung an. Sie versucht, verschiedene Sektoren und Ansprüche an den Raum zu vereinen und die Schutzgüter sowie Ressourcen langfristig zu schützen und zu sichern. [...]
Hellmich, Meike
Klimawandel,räumliche Planung,Evaluation,Nachhaltiges Landmanagement,climate change,spatial planning,evaluation,sustainable land management
2018
Local Linear Dependence Measure for Functionally Correlated Variables
http://d.repec.org/n?u=RePEc:aim:wpaimx:1853&r=all
We propose a new correlation measure for functionally correlated variables based on local linear dependence. It is able to detect non-linear, non-monotonic and even implicit relationships. Applying the classical linear correlation in a local framework combined with tools from Principal Components Analysis the statistic is capable of detecting very complex dependences among the data. In a first part we prove that it meets the properties of independence, similarity invariance and dependence and the axiom of continuity. In a second part we run a numerical simulation over a variety of dependences and compare it to other dependence measures in the literature. The results indicate that we outperform existing coefficients. We also show better stability and robustness to noise.
Loann D. Desboulets
Costin Protopopescu
local correlation, Pearson coefficient, PCA, non-parametric statistic, implicit dependence, non-monotonic, non-linear
2018-11
The Comparative African Economics of Governance in Fighting Terrorism
http://d.repec.org/n?u=RePEc:afe:wpaper:18/046&r=all
This study assesses the comparative economics of governance in fighting terrorism in 53 African countries for period 1996-2012. Four terrorism variables are used, namely: domestic, transnational, unclear and total terrorism dynamics. Nine bundled and unbundled governance variables are employed, notably: political stability/no violence, voice & accountability, political governance, government effectiveness, regulation quality, economic governance, corruption-control, the rule of law and institutional governance. The empirical evidence is based on Fixed Effects regressions. In the analytical procedure, we first bundle governance indicators by means of principal component analysis before engaging the empirical exercise with the full sample. In the final step, specifications are based on a decomposed full sample in order to articulate the fundamental characteristics for comparative purposes. The following broad findings are established. First, good governance is an appealing tool in fighting terrorism. Second, the relevance of the good governance dynamics is as follows in order of increasing relevance: economic governance, institutional governance and political governance. The findings are presented in increasing order of magnitude to emphasise fundamental features in which governance dynamics have the highest effect in mitigating terrorism.
Simplice A. Asongu
Vanessa S. Tchamyou
Ndemaze Asongu
Nina Tchamyou
Terrorism; Governance; Africa
2018-01
Congestion Management: From Physics to Regulatory Instruments
http://d.repec.org/n?u=RePEc:zbw:esprep:189641&r=all
In recent years, power flows in many European transmission and distribution networks have increased, making the management of network congestion a much-debated – and increasing politicized – topic. This paper is an introduction to and a review of congestion management in European electricity grids. We review the physical measures available to avoid congestion, using a newly introduced analytical framework. Also, we provide a com-prehensive review of regulatory instruments used and proposed to incentivize those measures. Finally, we provide a description of the implementation of three prominent instruments, including so-called redispatch.
Hirth, Lion
Glismann, Samuel
Redispatch,Congestion Management
2018
Born to be an entrepreneur? How cultural origin affects entrepreneurship
http://d.repec.org/n?u=RePEc:zur:econwp:309&r=all
Persistent differences in entrepreneurial activity between regions and countries remain unexplained. This paper argues that cultural heritage is an important determinant. We exploit a quasi-experimental setting comparing entrepreneurial activities of individuals with different cultural ancestry from within Switzerland but who live in the same municipality today and are hence exposed to the same economic and institutional environment. We find that individuals with cultural origin on the German-speaking side of the Swiss language border found 20% more firms than their counterparts with cultural origin on the French-speaking side ─ no matter if they currently live in the German-speaking or French-speaking region. These newly founded firms are identical in terms of survival rate, industry composition, legal form, and firm size, independent of the cultural origin of firm founders. A model of entrepreneurial choice suggests that the empirical patterns of firm entry and performance are more likely driven by differences in risk aversion or preferences for entrepreneurship rather than by skill.
Katharina Erhardt
Simon Haenni
Culture, entrepreneurship, natural experiment
2018-12
Projektmanagement-Normen und -Standards
http://d.repec.org/n?u=RePEc:zbw:simata:1018033&r=all
Dieses Arbeitspapier gibt einen Überblick über aktuelle Normen und Standards, die für das Projektmanagement (PM) von Bedeutung sind. Als relevante Normungsorganisationen werden die International Organization for Standardization (ISO), das Deutsche Institut für Normung (DIN) und das US-amerikanische American National Standards Institute (ANSI) bzw. das Project Management Institute (PMI®) berücksichtigt. Bei den Standards werden solche Organisationen als relevant erachtet, die in der Lage sind, den von ihnen publizierten Standard einem breiten, im Projektmanagement tätigen Adressatenkreis publik zu machen, Dienstleistungen, wie z. B. Schulungen anzubieten, und eine Weiterentwicklung des Standards sicherzustellen. Insgesamt werden 27 PM-Normen und 13 PM-Standards beschrieben. Die Darstellung umfasst beispielsweise die Normenreihen DIN 6990x und ISO 215xx, aber auch ANSI/PMI®-Normen, wie den in der Praxis weit verbreiteten PMBOK® Guide. Als Projektmanagement-Standards werden u. a. die IPMA Individual Competence Baseline (IPMA ICB), PRINCE2® oder OpenPM2 behandelt. Auch Standards für die Prüfung von Projekten finden Berücksichtigung, z. B. der Prüfungsstandard Nr. 4 des Deutschen Instituts für Interne Revision e. V. (DIIR) zur Prüfung von Projekten. Zudem werden drei Werke zu agilen Vorgehensweisen im Projektmanagement vorgestellt. Jede Beschreibung enthält eine prägnante Inhaltsangabe, den formellen Status der Norm bzw. des Standards und Links für die eigene Recherche. Insofern soll dieses Arbeitspapier nicht nur eine aktuelle, systematische Zusammenstellung bieten, sondern es stellt auch eine Hilfestellung für ein schnelles Orientieren und Nachschlagen dar.
Klotz, Michael
Marx, Susanne
ANSI,DIN,DIIR,IDW,IPMA,ISO,PMI,Projekt,Projektmanagement,Normen,Standards
2018
Tax policies for inclusive growth in a changing world
http://d.repec.org/n?u=RePEc:oec:ctpaaa:40-en&r=all
This paper, Tax policies for inclusive growth in a changing world, has been prepared in support of Argentina’s G20 Presidency. While this paper is focused on taxation policy, it forms part of a broader contribution that the OECD has made in support of Argentina’s G20 presidency.Against a backdrop of increased inequality and persistently low productivity growth, this paper considers the challenges and opportunities confronting policy makers in a rapidly changing world as a result of globalisation, technological change and the changing world of work. The paper focusses on:• The impact of the tax system on the market distribution of income, by supporting employment, skills investments, and labour market formality.• How shifting tax mixes towards growth-friendly taxes can be combined with measures to improve progressivity, particularly through base-broadening and through removing inefficient and regressive tax expenditures.• Ways in which personal income taxes and social transfers can foster inclusive growth by raising the efficiency and equity of labour and capital income tax systems.• How tax policy can foster business dynamism and productivity, including through support for investment and innovation, and can raise efficiency by continuing to combat BEPS.• How tax capacity can be raised, and how tax administration can be strengthened, including through international co-operationThe paper provides tax policy advice and recommendations to support governments in their pursuit of tax and transfer policies conducive to inclusive growth, while supporting innovation and increased productivity growth; preserving the revenue-raising capacity of the tax system; and ensuring the sustainability of public spending.
Pierce O’Reilly
inclusive Growth, taxation
2018-12-18
Landwirtschaftlich genutzte Böden in Deutschland: Ergebnisse der Bodenzustandserhebung
http://d.repec.org/n?u=RePEc:zbw:jhtire:64&r=all
Die Bundesrepublik Deutschland hat sich als Unterzeichnerstaat mehrerer internationaler Vereinbarungen zum Klimaschutz verpflichtet, anthropogene Quellen und Senken von Treibhausgasen jährlich auf nationaler Skalenebene zu berichten. Dazu zählen auch CO2-Emissionen aus Veränderungen des Vorrates an organischem Kohlenstoff (Corg) im Boden - denn ein Verlust von Corg ist verbunden mit Emissionen des Treibhausgases CO2 aus Böden, ein Aufbau des Corg-Vorrates entspricht einer Festlegung von CO2-Kohlenstoff in Böden. Veränderungen des Corg-Vorrates von Böden sind somit klimawirksam und entsprechend im Rahmen der Treibhausgas-Emissionsberichterstattung zu bilanzieren. Das Bundesministerium für Ernährung und Landwirtschaft (BMEL) beauftragte das Thünen-Institut für Agrarklimaschutz mit der Planung und Durchführung der ersten Bodenzustandserhebung Landwirtschaft (BZE-LW), um eine bundesweit konsistente und vergleichbare Datenbasis bezüglich des Corg-Vorrates in den landwirtschaftlich genutzten Böden Deutschlands zu erhalten. Die BZE-LW dient in erster Linie der Absicherung, Verbesserung und Weiterentwicklung der Treibhausgas-Emissionsberichterstattung der Bundesrepublik Deutschland in den Bereichen Landnutzung und Landnutzungsänderungen. Die Ergebnisse fließen direkt in die Treibhausgas-Emissionsberichterstattung Deutschlands ein und bilden eine transparente Ausgangsbasis für den Nachweis von Veränderungen des Corg-Vorrates in landwirtschaftlich genutzten Böden. Eine zentrale Voraussetzung für die Bewertung der klimawirksamen Veränderungen des Corg-Vorrates in Böden ist die Kenntnis über die aktuelle Höhe sowie das Verständnis darüber, wie dieser Vorrat durch Klima-, Boden- und Nutzungsfaktoren beeinflusst wird. Neben der Erfassung des Corg-Vorrates in landwirtschaftlich genutzten Böden auf der Skalenebene Deutschlands sollte daher bewertet werden, welche Standort- und Nutzungsfaktoren diesen beeinflussen. Ein weiteres Ziel war die modellgestützte Bewertung, ob bei der aktuellen Bodenbewirtschaftung Veränderungen des Corg-Vorrates in landwirtschaftlich genutzten Böden zu erwarten sind. Mit dieser ersten bundesweiten BZE-LW wird auch die methodische und strukturelle Basis für eine regelmäßige Wiederholungsinventur geschaffen werden. Für spezifische Fragen zur Wirkung der landwirtschaftlichen Bodennutzung auf den Corg-Vorrat im Boden wurden parallel zur BZE-LW Untersuchungen an gezielt ausgewählten Dauer- und Exaktversuchen sowie an Praxisflächen durchgeführt. Die BZE-LW basierte auf einer Beprobung landwirtschaftlich genutzter Böden in einem deutschlandweiten Raster von 8 × 8 Kilometern - insgesamt 3104 Beprobungspunkte. Sie wurde mit aktiver Unterstützung der Landwirte, die die beprobten Flächen bewirtschafteten und Informationen zur Bodennutzung und ihrem landwirtschaftlichen Betrieb bereitstellten, durchgeführt. Die bodenkundliche Standortaufnahme erfolgte nach Bodenkundlicher Kartieranleitung KA5. Die Probenahme erfolgte einheitlich in den Tiefenstufen 0-10, 10-30, 30-50, 50-70 und 70-100 cm. Bei Moorböden wurden auch tiefer liegende Torfhorizonte beprobt. Die Bodenaufbereitung und -analysen erfolgten zentral im Labor des Thünen-Instituts. In den Bodenproben aller Standorte und Tiefenstufen wurden folgende Bodenkenngrößen gemessen: Gehalt an Corg sowie anorganischem Kohlenstoff und Gesamtstickstoff, pH-Wert, Feinbodenanteil (
Jacobs, Anna
Flessa, Heinz
Don, Axel
Heidkamp, Arne
Prietz, Roland
Dechow, René
Gensior, Andreas
Poeplau, Christopher
Riggers, Catharina
Schneider, Florian
Tiemeyer, Bärbel
Vos, Cora
Wittnebel, Mareille
Müller, Theresia
Säurich, Annelie
Fahrion-Nitschke, Andrea
Gebbert, Sören
Hopfstock, Rayk
Jaconi, Angelica
Kolata, Hans
Lorbeer, Maximilian
Schröder, Johanna
Laggner, Andreas
Weiser, Christian
Freibauer, Annette
Bodeninventur,Emissionsberichterstattung,Humus,Kohlenstoffvorrat,Landnutzungsänderung,Mineralboden,Monitoring,Moorboden,organische Bodensubstanz,organischer Kohlenstoff,Treibhausgas,carbon stocks,greenhouse gas inventory,land-use change,mineral soil,monitoring,organic carbon,organic soil,soil inventory,soil organic matter
2018
Diplômés de l’enseignement tertiaire : Quelles évolutions ?
http://d.repec.org/n?u=RePEc:oec:eduaag:61-fr&r=all
Ces dix prochaines années, un pourcentage croissant de jeunes adultes devraient obtenir un diplôme de l’enseignement tertiaire, la Chine et l’Inde caracolant en tête – en particulier dans les domaines en plein essor et extrêmement porteurs des STIM. Cependant, si dans les pays de l’OCDE et du G20, le pourcentage de diplômés de l’enseignement tertiaire devrait augmenter davantage chez les femmes que chez les hommes, celles-ci pourraient néanmoins continuer de rester en retrait dans les domaines des STIM, où elles ont toujours été sous-représentées. Dans un avenir proche, le défi consistera à garantir que les systèmes d’éducation sont en mesure de délivrer des diplômes de l’enseignement tertiaire d’une qualité et d’une pertinence optimales, dans un souci constant d’équité et d’inclusivité.
OCDE
2018-12-19
The big bang: Stock market capitalization in the long run
http://d.repec.org/n?u=RePEc:zbw:ibfpps:0218&r=all
This paper presents annual stock market capitalization data for 17 advanced economies from 1870 to today. Extending our knowledge beyond individual benchmark years in the seminal work of Rajan and Zingales (2003) reveals a striking new time series pattern: over the long run, the evolution of stock market size resembles a hockey stick. The stock market cap to GDP ratio was stable for more than a century, then tripled in the 1980s and 1990s and remains high to this day. This trend is common across countries and mirrors increases in other financial and price indicators, but happens at a much faster pace. We term this sudden structural shift 'the big bang' and use novel data on equity returns, prices and cashflows to explore its underlying drivers. Our first key finding is that the big bang is driven almost entirely by rising equity prices, rather than quantities. Net equity issuance is sizeable but relatively constant over time, and plays very little role in the short, medium and long run swings in stock market cap. Second, much of this price increase cannot be explained by more favourable fundamentals such as profits and taxes. Rather, it is driven by lower equity risk premia. Third, consistent with this risk premium view of stock market size, the market cap to GDP ratio is a reliable indicator of booms and busts in the equity market. High stock market capitalization - the 'Buffet indicator' - forecasts low subsequent equity returns, and low - rather than high - cashflow growth, outperforming standard predictors such as the dividend-price ratio.
Kuvshinov, Dmitry
Zimmermann, Kaspar
2018
Cambios demográficos de las familias peruanas en los últimos 20 años: decisiones sobre natalidad y nupcialidad
http://d.repec.org/n?u=RePEc:apc:wpaper:133&r=all
La presente investigación estudia la evolución de las decisiones sobre natalidad y nupcialidad de las mujeres peruanas en el período 1996-2016. En particular, se estudiaron las relaciones entre dichas decisiones y el nivel educativo alcanzado por la mujer, la generación a la que pertenece, y la región en la que vive. Para ello, se utilizaron datos provenientes de la Encuesta Nacional Demográfica y Salud (ENDES). La estrategia empírica consistió en un modelo de probabilidad condicional, y una regresión de mínimos cuadrados ordinarios (OLS). Se encontró que un mayor nivel educativo tiene un efecto negativo sobre la demanda de hijos y sobre la decisión de convivir en pareja; sin embargo, influye positivamente en la decisión de casarse. Además, dicho efecto es heterogéneo según locación geográfica y nivel de ruralidad. Finalmente, se evidenció que las mujeres de generaciones más recientes, prefieren tener menos hijos y se casan menos.
Camila Alegría
Javier Torres
Claudia Velarde
natalidad, nupcialidad, demografía, educación
2018-12
Auswirkung der Elektromobilität auf die Haushaltsstrompreise in Deutschland
http://d.repec.org/n?u=RePEc:zbw:fisisi:s212018&r=all
[Einleitung ...] Das Arbeitspapier gliedert sich wie folgt. Im nächsten Kapitel wird ein Markthochlaufszenario für Elektrofahrzeuge, das mögliche Ladeverhalten von Nutzern der Elektrofahrzeuge sowie der Einfluss einer höheren Ladeleistung auf die Mobilität dargestellt. Aufbauend auf dem entwickelten Szenario werden in Kapitel 3 auf der Basis einer Energiesystemmodellierung für Deutschland die möglichen Aus-wirkungen der Elektromobilität auf die Erzeugungspreise von Strom berechnet. Dabei werden auch die Effekte des Lastmanagements von Elektrofahrzeugen auf die Stromerzeugung betrachtet. Dann wird in Kapitel 4 der Einfluss von Elektrofahrzeugen auf Stromverteilnetze und die Netzentgelte simuliert. Hierzu wird ein Untersuchungsfall definiert, der aus einem Photovoltaik- und Netzszenario besteht. Verschiedene Fälle mit unterschiedlicher Ladeleistung der Elektrofahr-zeuge sowie gesteuertem und ungesteuertem Laden werden dabei untersucht. Anschließend (Kapitel 5) werden die Auswirkungen auf den gesamten Strompreis für Haushaltskunden analysiert. Im letzten Kapitel erfolgt eine Zusammenfassung und anschließend werden Schlussfolgerungen für die Politik gezogen.
Wietschel, Martin
Kühnbach, Matthias
Stute, Judith
Gnann, Till
Marwitz, Simon
Klobasa, Marian
2018
Wechselwirkungen zwischen orthodoxer Wirtschaftswissenschaft und Neoliberalismus
http://d.repec.org/n?u=RePEc:zbw:roswps:158&r=all
Die fehlende Einbettung der Wirtschaftswissenschaft in die Gesellschaft und ihr soziales Umfeld haben schwerwiegende Folgen. Ein tieferliegendes Verständnis ökonomischer Zusammenhänge ist verloren gegangen, was zu einer mangelnden Analysefähigkeit der Zunft geführt hat. Ein Kandidat für die Charakterisierung der aktuellen politischen und gesellschaftlichen Verhältnisse ist der Neoliberalismus. Welche wechselseitigen Beziehungen zwischen orthodoxer Wirtschaftswissenschaft und Neoliberalismus vorherrschen, darauf will diese Arbeit versuchen Antworten zu geben. Insbesondere wird ersichtlich, dass der Neoliberalismus seine Legitimation auf den wissenschaftlichen Erkenntnissen der orthodoxen Wirtschaftswissenschaft aufbaut. Aufgrund dessen wird die orthodoxe Wirtschaftswissenschaft auf ihre ontologischen, epistemologischen und methodologischen Grundlagen hin untersucht. Es wird gezeigt, wie über Kriterien der Ermöglichung und der Demarkation ein Wissenschaftsbild transportiert wird, welches dem Neoliberalismus seine Legitimation verleiht. In Hinsicht darauf, dass Wechselwirkungen auch eine reaktive Wirkrichtung implizieren, wird versucht darzulegen wie der Neoliberalismus die orthodoxe Wirtschaftswissenschaft prägt. Hierbei wird vor allem das Journalsystem und die Drittmittelförderung betrachtet.
Hübenbecker, Ulf
neoliberalism,orthodox economics,mainstream economics,epistemology
2018
CasP's 'Differential Accumulation' versus Veblen's 'Differential Advantage'
http://d.repec.org/n?u=RePEc:zbw:capwps:201808&r=all
This paper clarifies a common misrepresentation of our theory of capital as power, or CasP. Many observers tend to box CasP as an "institutionalist" theory, tracing its central process of "differential accumulation" to Thorstein Veblen's notion of "differential advantage". This view, we argue, betrays a misunderstanding of CasP, Veblen or both. As we show, CasP's notion of differential accumulation is not only different from, but also diametrically opposed to Veblen's differential advantage. Veblen, who wrote at the turn of the twentieth century, before the appearance of business indices and financial benchmarks, emphasized the absolute drive for "maximum profit" and saw strategic sabotage merely as a power means to an economic end. By contrast, CasP, which was developed at the end of the twentieth century, sees power not only as a means of accumulation, but also - and perhaps more importantly - as its ultimate purpose. Accumulators, it argues, are conditioned and driven to augment not their profits and assets as such, but their relative power, and this means that, as symbolic bearers of power, these profits and assets should be measured not absolutely, but relatively to those of others - hence the imperative of differential accumulation.
Bichler, Shimshon
Nitzan, Jonathan
capital as power,differential advantage,differential accumulation,Thorstein Veblen
2018
CSR, trust and the employer brand
http://d.repec.org/n?u=RePEc:zbw:imbwps:96&r=all
Trust in companies and their executives seems to have declined in recent years (Edelman Trust Barometer, 2018; Reputation Institute, 2018; Tonkiss, 2009), with consequences for the credibility of the entire economic system. At the same time, there is some evidence, that social responsibility is considered important for the long-term success of companies by university students, who represent the future entrants to the job market (Elias, 2004). Those future entrants seem to be interested in companies' responsible behavior and sustainable governance. In line with demographic challenges and resulting staffing bottlenecks, companies are challenged to position themselves as attractive employers in the job-market. Against this background, the discussion about trust, Corporate Social Responsibility (CSR) and the employer brand has gained traction. The objective of this paper is to conceptualize the relation between trust, CSR and the employer brand and to derive instruments for building trust via CSR and employer branding. Trust is understood as the "psychological state comprising the intention to accept vulnerability based upon positive expectations of the intentions or behavior of another" (Rousseau, Sitkin, Burt & Camerer, 1998). The paper describes elements and determining factors for trust and discusses the influence of CSR activities and the employer brand on employer choice and trust. Finally, instruments rooted in CSR and employer branding that enhance trust in companies are identified.
Bustamante, Silke
CSR,workplace CSR,trust,employer choice,employer branding
2018
How Enhancing ICT has affected Inequality in Africa for Sustainable Development: An Empirical Investigation
http://d.repec.org/n?u=RePEc:agd:wpaper:18/054&r=all
This study examines if enhancing ICT reduces inequality in 48 countries in Africa for the period 2004-2014. Three inequality indictors are used, namely, the: Gini coefficient, Atkinson index and Palma ratio. The adopted ICT indicators include: mobile phone penetration, internet penetration and fixed broadband subscriptions. The empirical evidence is based on the Generalised Method of Moments. Enhancing internet penetration and fixed broadband subscriptions have a net effect on reducing the Gini coefficient and the Atkinson index, whereas increasing mobile phone penetration and internet penetration reduces the Palma ratio. Policy implications are discussed in the light of challenges to Sustainable Development Goals.
Simplice A. Asongu
Nicholas M. Odhiambo
ICT; Inclusive development; Africa; Sustainable development
2018-09
Optimal Healthcare Contracts:Theory and Empirical Evidence from Italy
http://d.repec.org/n?u=RePEc:yor:hectdg:18/33&r=all
In this paper we investigate the nature of the contracts between a large health-care purchaser and health service providers in a prospective payment system. We model theoretically the interaction between patients choice and cream-skimming by hospitals. We test the model using a very large and detailed administrative dataset for the largest region in Italy. In line with our theoretical results, we show that the state funded purchaser offers providers a system of incentives such that the most efficient providers both treat more patients and also treat more difficult patients, thus receiving a higher average payment per treatment.
Berta, P.;
De Fraja, G.;
Verzillos, S.;
patients choice; cream skimming; optimal healthcare contracts; hospitals; Lombardy;
2018-12
Trendreport Betriebsratswahlen 2018: Erste Befunde, Stand Herbst 2018
http://d.repec.org/n?u=RePEc:zbw:hbsmbr:45&r=all
Dieser Report fasst die vorläufige Querschnittsanalyse des Trendberichts Betriebsratswahlen 2018 zusammen. Die Auswertung basiert auf Daten aus 18.093 Betrieben, die bis September 2018 vorlagen. Nur ausgewählte Variablen, die in allen Rohdatensätzen übereinstimmen, wurden ausgewertet. Daher können zu diesem Zeitpunkt nicht für alle Gewerkschaften Aussagen getroffen werden.Die Beteiligung an den Betriebsratswahlen 2018 ist nach der ersten Bestandsaufnahme relativ stabil geblieben. Die durchschnittliche Wahlbeteiligung liegt bei 75,5 Prozent, die allgemeine Wahlbeteiligung liegt bei 65,66 Prozent.Das vereinfachte Wahlverfahren hat positive Effekte auf die Wahlbeteiligung, sofern ein Betriebsrat gewählt wird.Der Frauenanteil bleibt in den Betriebsräten stabil, ein Aufwärtstrend ist nicht zu erkennen. Das gilt auch für die Besetzung der Führungspositionen in Betriebsräten.Insgesamt sind 61,7 Prozent der Betriebsratsmitglieder 46 Jahre und älter.Die vorläufigen Wahlergebnisse 2018 werden weiter vertieft und fundiert. Endgültige Aussagen zur Querschnittsanalyse 2018 sowie Längsschnittanalyse werden im Frühjahr 2019 vorgelegt.Erst die Längsschnittanalyse mit identischen Betrieben bietet die valide statistische Grundlage, um über unterschiedliche Wahlperioden in ein und denselben Betrieben die sich anbahnenden Trends, Verfestigungen und Verschiebungen empirisch zu erhärten.
Demir, Nur
Funder, Maria
Greifenstein, Ralph
Kißler, Leo
Maschke, Manuela
2018
The big bang and the City of London
http://d.repec.org/n?u=RePEc:zbw:ibfpps:0318&r=all
Brexit poses an existential challenge the City of London as a European and global financial centre. The withdrawal of 'passporting' threatens the ability of financial institutions in London to sell services to customers in the EU, and this has prompted many predictions of London's financial demise. Banks are considering relocating staff and activities to other European centres such as Frankfurt, Dublin or Paris. Reflecting on London's history offers some insights into how The City might respond to this new challenge.
Schenk, Catherine R.
2018
Population and poverty in Ireland on the eve of the Great Famine
http://d.repec.org/n?u=RePEc:zbw:qucehw:201813&r=all
The link between demographic pressure and economic conditions in pre-Famine Ireland has long interested economists. This paper re-visits the topic, harnessing the highly disaggregated parish-level data from the 1841 Census of Ireland. Using population per value adjusted acre as a measure of population pressure, our results indicate that on the eve of the Great Famine of 1846{50, population pressure was positively associated with both illiteracy rates and the prevalence of poor quality housing. But while our analysis shows that population pressure was one of the primary factors underpinning pre-Famine poverty, it also highlights the importance of geography and human agency. A counterfactual computation indicates that had Ireland's population stayed at its 1800 level, this would have led to only modest improvements in literacy and housing.
Fernihough, Alan
Ó Gráda, Cormac
Famine,Malthus,Population,Ireland
2018
The Comparative African Economics of Governance in Fighting Terrorism
http://d.repec.org/n?u=RePEc:agd:wpaper:18/055&r=all
This study assesses the comparative economics of governance in fighting terrorism in 53 African countries for period 1996-2012. Four terrorism variables are used, namely: domestic, transnational, unclear and total terrorism dynamics. Nine bundled and unbundled governance variables are employed, notably: political stability/no violence, voice & accountability, political governance, government effectiveness, regulation quality, economic governance, corruption-control, the rule of law and institutional governance. The empirical evidence is based on Fixed Effects regressions. In the analytical procedure, we first bundle governance indicators by means of principal component analysis before engaging the empirical exercise with the full sample. In the final step, specifications are based on a decomposed full sample in order to articulate the fundamental characteristics for comparative purposes. The following broad findings are established. First, good governance is an appealing tool in fighting terrorism. Second, the relevance of the good governance dynamics is as follows in order of increasing relevance: economic governance, institutional governance and political governance. The findings are presented in increasing order of magnitude to emphasise fundamental features in which governance dynamics have the highest effect in mitigating terrorism.
Simplice A. Asongu
Vanessa S. Tchamyou
Ndemaze Asongu
Nina Tchamyou
Terrorism; Governance; Africa
2018-01
Stochastic frontier analysis in higher education: A systematic review
http://d.repec.org/n?u=RePEc:zbw:tudcep:0518&r=all
This paper provides a systematic review of the literature that employs stochastic frontier analysis to measure the efficiency of higher education institutions. The overview opens with a look at the general development of the literature, before emphasis is laid on the methodical aspects. Focus is thereby placed on the necessary underlying assumptions and the employed specifications, discussing their advantages and drawbacks. Afterwards, the factors that were specified in the literature, including the input and output variables, as well as the determinants of efficiency, are discussed in detail. Based on the insights of the literature review, the paper highlights some of the existing deficiencies and ways forward. To our knowledge, the present study provides the first systematic review on the usage of the stochastic frontier analysis to measure efficiency in the higher education sector.
Gralka, Sabine
Review,Efficiency,Higher Education,Stochastic Frontier Analysis
2018
Threshold regression with endogeneity for short panels
http://d.repec.org/n?u=RePEc:acb:cbeeco:2018-665&r=all
This note considers the estimation of dynamic threshold regression models with fixed effects using short panel data. We examine a two-step method, where the threshold parameter is estimated nonparametrically at the N-rate and the remaining parameters are estimated by GMM at the √N-rate. We provide simulation results that illustrate the potential advantages of the new method in comparison with pure GMM estimation. The simulations also highlight the importance the choice of instruments in GMM estimation.
Tue Gorgens
Allan H. Würtz
2018-04
Social emotional learning in the classroom: Study protocol for a randomized controlled trial of PERSPEKT 2.0
http://d.repec.org/n?u=RePEc:aah:aarhec:2018-11&r=all
Social emotional learning programs have been found to lead to immediate improvements in cognitive, social and emotional competences. Meanwhile, most evidence to date refers to the United States, and most other countries lack locally tailored teaching materials for socio-emotional learning. Further, there is a lack of knowledge about which subgroups benefit more. Such knowledge is important, because it could provide evidence relevant for both explaining and addressing inequality in educational achieving across subgroups of pupils. Knowledge about longer-term impacts on academic achievement is also called for. This protocol describes an experimental evaluation of a recently developed social emotional learning program implemented in Denmark. The evaluation combines survey data with register-based data, where the latter source allows for tracking of participant outcomes with minimal risk of attrition.
Ninja Ritter Klejnstrup
Anna Folke Larsen
Helene Bie Lilleør
Marianne Simonsen
Social emotional learning, well-being, academic achievement, problem behavior, subgroups, longer-term follow up
2018-12-04
Stellungnahme zum Gesetzentwurf der Bundesregierung sowie dem Antrag der Abgeordneten Pia Zimmermann, Susanne Ferschl, Matthias W. Birkwald, weiterer Abgeordneter und der Fraktion DIE LINKE (BT-Drucksachen 19/5464, 19/5525)
http://d.repec.org/n?u=RePEc:zbw:iwkrep:462018&r=all
In den letzten 20 Jahren sind die Pflegefallzahlen sowohl in der sozialen als auch in der privaten Pflegeversicherung kontinuierlich gestiegen. Dies mag zwar auch auf ein über die Zeit geändertes Antragsverhalten der Versicherten zurückzuführen sein, ein Großteil dieses Trends ist jedoch der zunehmenden Alterung der Bevölkerung zuzuschreiben. Allerdings hat das - aus pflegerischer Sicht sicher notwendige - Inkrafttreten der wichtigsten Regelungen des Zweiten Pflegestärkungsgesetzes (PSGII) noch einmal für einen zusätzlichen Anstieg der Pflegfallzahlen gesorgt: Lag der Zuwachs in der sozialen Pflegeversicherung in der Vergangenheit immer maximal im oberen fünfstelligen Bereich, sind allein hier zwischen 2016 und 2017 über 550.000 Pflegebedürftige hinzugekommen (Abbildung 1-1). Ein Großteil dieser Entwicklung lässt sich den veränderten Leistungsansprüchen zuschreiben, und hierbei vor allem der Ausweitung der Definition von Pflegebedürftigkeit (hierzu auch Rothgang/Müller, 2018, 24 ff.).
Kochskämper, Susanna
2018
Efficiency, Stability, and Commitment in Senior Level Job Matching Markets
http://d.repec.org/n?u=RePEc:yor:yorken:18/20&r=all
We study a senior level job matching model with multiple heterogeneous incumbents and entrants. Incumbents can be committed or uncommitted (i.e., free). A committed agent is an incumbent (firm or worker) who has initially had a partner (worker or firm) and is bound by her commitment. A free agent is an entrant or an incumbent whose relation with by her initial partner is not binding. Every agent tries to find her best possible partner with contract. A committed agent cannot unilaterally dissolve her partnership unless her partner agrees to do so. We examine the problem of how to match workers and firms as well as possible and at the same time to set committed agents free as many as possible without violating their commitments to their partners. We show the existence of (strongly) stable and (strict) core matchings through a constructive algorithm and derive several properties of such outcomes.
Ning Sun
Zaifu Yang
Matching state, core, stability, commitment, procedure.
2018-11
A Model of Competing Narratives
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13319&r=all
We formalize the argument that political disagreements can be traced to a "clash of narratives". Drawing on the "Bayesian Networks" literature, we model a narrative as a causal model that maps actions into consequences, weaving a selection of other random variables into the story. An equilibrium is defined as a probability distribution over narrative-policy pairs that maximizes a representative agent's anticipatory utility, capturing the idea that public opinion favors hopeful narratives. Our equilibrium analysis sheds light on the structure of prevailing narratives, the variables they involve, the policies they sustain and their contribution to political polarization.
Eliaz, Kfir
Spiegler, Ran
Anticipatory Utility; model misspecification; narratives; Polarization; Political Competition
2018-11
Whither the American West? Natural Amenities, Energy and Nonmetropolitan County Growth
http://d.repec.org/n?u=RePEc:pra:mprapa:90078&r=all
The American West has long experienced strong economic growth. The varied economy of the region though has produced a diversity of economic outcomes and trends. In this paper, we assess whether there have been significant relative shifts in economic growth across the nonmetropolitan counties of the region between the periods of 1992-2004 and 2004-2016. We find significant relative downward growth shifts in areas most abundant in natural amenities. Further analysis suggests the downward growth shifts in high amenity counties resulted from the capitalization of the amenities into housing costs, not from diminished quality of life in the counties. Economic growth significantly accelerated in counties where significant oil and gas extractive activity occurred, in which most of the counties were not previously considered as highly dependent on the energy industry. Counties with low levels of natural amenities and an absence of oil and gas resources continued to struggle and are suggested to likely be in need of place-based labor demand policies.
Rickman, Dan S.
Wang, Hongbo
Natural amenities; Oil and gas boom; Nonmetropolitan counties
2018-11-16
Gender Differences within the Firm: Evidence from Two Million Travelers
http://d.repec.org/n?u=RePEc:pra:mprapa:90060&r=all
We document gender differences in the behavior of similar workers within a firm when they book business air travel. We show that women pay consistently less per ticket than men, after accounting for a large set of covariates that include the characteristics of the traveler, the routes and class they travel on, the firms that employ them, and the position that the traveler holds in the firm. A large proportion of the lower fares paid by women is explained by women booking flights earlier than men. We find significant variation in gender differences across the regions of the world. Using country-level data on preference differences, we show that gender differences in both positive and negative reciprocity are an important factor associated with the documented gender differences. In particular, negative reciprocity alone is able to explain the gender difference in paid fare: women (men) are less (more) willing to trade the firms’ money for their own utility when they feel they have been treated unfairly. The documented gender differences have both important monetary implications for firms and implications for the role of morale within the firm.
Donna, Javier D.
Veramendi, Gregory
Gender differences; worker gender differences
2018-08-06
The effects of non-tariff measures on agri-food trade: a review and meta-analysis of empirical evidence
http://d.repec.org/n?u=RePEc:pra:mprapa:89913&r=all
The increasing policy interests and the vivid academic debate on non-tariff measures (NTMs) has stimulated a growing literature on how NTMs affect agri-food trade. The empirical literature provides contrasting and heterogeneous evidence, with some studies supporting the ‘standards as catalysts’ view, and others favouring the ‘standards as barriers’ explanation. To the extent that NTMs can influence trade, understanding the prevailing effect, and the motivations behind one effect or the other, is a pressing issue. We review a large body of empirical evidence on the effect of NTMs on agri-food trade and conduct a meta-analysis to disentangle potential determinants of heterogeneity in estimates. Our findings show the role played by the publication process and by study-specific assumptions. Some characteristics of the studies are correlated with positive significant estimates, others covary with negative significant estimates. Overall, we found that the effects of NTMs vary across types of NTMs, proxy for NTMs, and levels of details of studies. Not negligible is the influence of methodological issues and publication process.
Santeramo, Fabio Gaetano
Lamonaca, Emilia
Non-tariff measures; Trade barriers; Trade standards; Meta-analysis
2018-09
An Information-Theoretic Approach to Estimating Willingness To Pay for River Recreation Site Attributes
http://d.repec.org/n?u=RePEc:pra:mprapa:89842&r=all
This study applies an information theoretic econometric approach in the form of a new maximum likelihood-minimum power divergence (ML-MPD) semi-parametric binary response estimator to analyze dichotomous contingent valuation data. The ML-MPD method estimates the underlying behavioral decision process leading to a person’s willingness to pay for river recreation site attributes. Empirical choice probabilities, willingness to pay measures for recreation site attributes, and marginal effects of changes in some explanatory variables are estimated. For comparison purposes, a Logit model is also implemented. A Wald test of the symmetric logistic distribution underlying the Logit model is rejected at the 0.01 level in favor of the ML-MPD distribution model. Moreover, based on several goodness-of-fit measures we find that the ML-MPD is superior to the Logit model. Our results also demonstrate the potential for substantially overstating the precision of the estimates and associated inferences when the imposition of unknown structural information is not accounted explicitly for in the model. The ML-MPD model provides more intuitively reasonable and defensible results regarding the valuation of river recreation than the Logit model.
Henry, Miguel
Mittelhammer, Ron
Loomis, John
Minimum power divergence, contingent valuation, binary response models, information theoretic econometrics, river recreation
2018-01
Microfinance in Cambodia: Development, Challenges, and Prospects
http://d.repec.org/n?u=RePEc:pra:mprapa:89969&r=all
Microfinance is considered one of the effective tools in reducing poverty. In the last two decades, Cambodian microfinance industry has made rapid growth in asset, loan and deposit. Microfinance institutions have extended their services to all corner of the country and some have transformed from a donor-assisted NGO program to a full-fledged commercial bank. During the process of the growth of the industry, many borrowers have benefited and been able to move out of poverty while other become over-indebted and lose their asset due to factors such as low financial literacy and the ease to access multiple sources of loan. At the national level, financing microfinance may crowd out the fund for financing small and medium enterprises, and other types of business. Various government response such as the initiative to improve financial literacy and the imposition of interest cap may help reduce the problem of over-indebtedness at the individual borrower level. However, for long run development, they also should consider addressing the trade-off between allocating scarce fund between micro businesses, and small and medium enterprises.
Thath, Rido
microfinance, Cambodia
2018-03
La convergence de la comptabilité de l’Etat avec les normes IPSAS. Le cas du Maroc
http://d.repec.org/n?u=RePEc:pra:mprapa:90039&r=all
The State's accounting system must have an accrual accounting system in order to prepare financial statements that record changes in the heritage value, explain and reflect the way in which the state budget is managed both in revenue and expenditure and thus reflect the exact financial situation of the state at a given time. Once the accounting system of the State reflects the exact financial situation it can serve as a source of reliable and transparent financial information addressed, published and accessible to any interested person (citizen, politician, international financial institution ...). This article proposes to examine the impact of the adoption of IPSAS on Moroccan public finances.
Ayachi, Ghoufrane
Accrual Accounting, Public Finance, State Accounting, Public Sector, IPSAS.
2018-11-14
Determinants of Trademarking: Evidence from Arizona and New Mexico Startups
http://d.repec.org/n?u=RePEc:pra:mprapa:90096&r=all
Trademarks are considered an important indicator of entrepreneurial innovation, especially among nontechnology-based service firms and startups. Therefore, it is essential to understand the motivations and drivers behind trademark applications to get a grasp of firm innovation behavior. This study focuses on the trademark decisions of startup firms. The paper assembles a unique dataset of startup firms linking firm trademark application and registration information with firm characteristics. The goal is to empirically examine the determinants of startup trademark decisions. The key results show that firm size is important, and startups of 51-200 employees have the highest propensity of seeking trademarks. Startup location, firm age, and firm type also matter. Within our study area, for example, startups in the Phoenix metro area are significantly more likely to file trademark applications than those in the Albuquerque metro area. Technology-related startups find trademarks less attractive compared to other startups.
Wang, Haoying
Dou, Shuming
Startup, Trademarks, Intellectual Property, SMEs
2018-04-18
A kis- és középvállalati szektor Magyarországon
http://d.repec.org/n?u=RePEc:pra:mprapa:90066&r=all
In Hungary, more than 670,000 SMEs operate (99% coverage), which employ the 70% of all employees, more than 1.9 million people. The operating small and medium-sized enterprises are characterized by a strong territorial concentration: Central Hungary's weight is outstanding (40%). In the case of organizations, micro-enterprises dominate in all regions, at national level more than 94% of enterprises operate in this form. The main goal is to bring productivity and wage rise simultaneously, thus enabling Hungary to rise above the labor-cost – benefit competitiveness model and the medium-level trap. In terms of its labor productivity per employee, Hungary is somewhat below the average of the Visegrád countries (Czech Republic, Hungary, Poland and Slovakia). In the Visegrád region, the productivity of Hungarian manufacturing SMEs grew to a small extent (2.7%), while the growth rate of the service sector (3.5%) was the highest in the region. Six main themes can be identified, which clearly reduce the domestic and international competitiveness of small and medium-sized enterprises: weaknesses in the state and Union support system, low productivity and wage levels, moderate research and innovation performance, high public burdens and a lot of administrative burden. Therefore, the main objective is to strengthen the competitiveness.
Vértesy, László
Small and medium-sized enterprises, SME, economy, employment, competitiveness, R&D, taxation
2018
Difference in the Population Size between Rural and Urban Areas of Pakistan
http://d.repec.org/n?u=RePEc:pra:mprapa:90054&r=all
The purpose of present study is to explore the trend of difference in population size and growth rate of the two sectors of Pakistan i.e. rural and urban over a period of 57 years (from 1960 to 2017). It is important to know this trend for resources allocation and also to get an insight into related issues in future. The data has been obtained from secondary source of publically available site of World Bank. Results demonstrate a progressive increase in the population size of both the sectors. However, the pace of increase in population of rural sector is not only faster than that of urban but also it shows a much higher rate of increase after 1980. But in case of population growth rate it is urban sector that leads. Throughout the span of 57 years, for urban area the growth rate has varied from 4.6% to 3.1%. On the other hand, for rural areas, it ranges from 3.1% to 1.2%. Results are discussed along with their probable reason.
Alvi, Mohsin Hassan
Rural population, Urban population, Population growth rate, Population size
2018-11-15
Study on The Impact of Socio-Economic Crisis on Greek Wellness Tourists’ Spending Behavior
http://d.repec.org/n?u=RePEc:pra:mprapa:90102&r=all
As most of the sectors of the world economy, tourism has also been affected by the global economic crisis and the resulting social redeployment. This global socio-economic situation, since 2010, has exerted additional pressure on the mental health and physical condition of people who are increasingly looking for new ways of relaxation and rejuvenation. The present study aims to investigate the impact of the current socio-economic crisis on the behavior and attitude of Greek wellness tourists. Quantitative research was conducted using a structured questionnaire on a sample size of 452 wellness tourists in totally 10 spas at Crete, Kos, Lefkada and Thessaloniki. The survey compared the spending behavior of respondents before 2010 and today. The findings of the survey show that although the behavior of Greeks as consumers is being negatively affected by the economic downturn, there is positive intention to continue using and spending on wellness services. In addition, results indicate the existence of positive attitude towards wellness tourism as a means of health promotion and enhancement. Proposals for further research are suggested.
Tavlikou, Evangelia
Assimakopoulos, Costas
wellness tourism; consumer behavior; socio-economic crisis
2018-01-12
Precio de las emisiones de CO2 en la generación eléctrica
http://d.repec.org/n?u=RePEc:pra:mprapa:89915&r=all
This paper aims to identify the effects of including the price of CO2 emissions in the Total Levelized Cost of Generation (CTNG, in Spanish) of the combined cycle power plant. Monte Carlo simulation is used to estimate the probability densities of the CTNG and the Total Levelized Cost of Generation with Externalities (CTNGE). The effects of the price of CO2 emissions in the CTNG of the combined cycle plant are analysed through the concepts of stochastic dominance. We find that the price of CO2 emissions makes the CTNGE of the combined cycle plant to be higher and riskier than the CTNG. On the other hand, the CTNGE of the combined cycle plant is very sensitive to changes in the price of CO2 emissions. The analysis suggests that the share of electricity generation through combined cycle plants should be reduced to replace it with clean technologies. A limitation of the work is that the CTNG and CTNGE probability densities, generated through Monte Carlo simulation, depend on the data used, so they are sensitive to changes in the input parameters.
Gómez-Ríos, María del Carmen
Juárez-Luna, David
CO2 Emissions, Generation, Electricity, Levelized Cost.
2018-10-19
Reforming Undergraduate Economics Education in India: A Case for Inter-disciplinarity
http://d.repec.org/n?u=RePEc:pra:mprapa:90033&r=all
Since India is a nation of unique diversity, with its economy and society driven by many agencies, institutions and beliefs, the application of economics as well as other social sciences is required to address the various socio-economic problems in India. This approach of inter-disciplinarity has to be followed in the graduate curriculum of economics which has been severely criticised by the academic community as neither job-oriented nor able to understand the full extent of the nature and problems within the Indian economy. This article tries to initiate discussion in kerala context on various grounds such as pedagogical changes, evaluation of course and curriculum, resource constrains and issues of politics and bureaucracy are all inevitable part of the reformation of graduate curriculum of economics.
George, Justine
Under Graduate Curriculum in Economics, Inter-disciplinarity
2018-10-22
A simple and accurate method to calculate domestic and foreign value-added in gross exports
http://d.repec.org/n?u=RePEc:pra:mprapa:89907&r=all
In this paper, we propose a hypothetical extraction that provides a theoretically-funded measure of FVA in gross exports and we provide full expressions for a decomposition of gross exports into four terms: DVA, domestic double counting (DDC), FVA and foreign double counting (FDC). As in Los et al. (2016), the fact that we calculate a hypothetical GDP without the exports from a given country is the basis for validating the interpretation of the FVA term. Our DVA term is the same as Los et al. (2016).
Miroudot, Miroudot
Ye, Ming
Trade accounting, input-output table, Value-added decomposition, Global value chains
2018-09-01
The "End of Men" and Rise of Women in the High-Skilled Labor Market
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13323&r=all
We document a new finding regarding changes in labor market outcomes for high-skilled men and women in the US. Since 1980, conditional on being a college-educated man, the probability of working in a cognitive/high-wage occupation has fallen. This contrasts starkly with the experience for college-educated women: their probability of working in these occupations rose, despite a much larger increase in the supply of educated women relative to men. We show that one key channel capable of rationalizing these findings is a greater increase in the demand for female-oriented skills in cognitive/high-wage occupations relative to other occupations. Using occupation-level data, we find evidence that this relative increase in the demand for female skills is due to an increasing importance of social skills within such occupations. Evidence from both male and female wages is also indicative of an increase in the demand for social skills. Finally, we document how these patterns change across the early and latter portions of the period.
Jaimovich, Nir
2018-11
Civicness drain
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13311&r=all
Migration may cause not only a brain drain but also a civicness drain, leading to an uncivicness trap. We study this possibility using college choices of southern-Italian students classified as Civic if not cheating in a die-roll experiment. Local civicness is the fraction of Civic in their high-school class. A civicness drain is observed at high and low local civicness. We explain this finding in a model in which Civic and Uncivic types balance hope vs. fear of migration outcomes, taking into account economic gains, risk preferences, and their beliefs about being considered Civic in the place of destination.
Casari, Marco
Depaola, Maria
Ichino, Andrea
Marandola, Ginevra
Michaeli, Moti
Scoppa, Vincenzo
Experiments; Honesty game; Italy; migration; social capital
2018-11
The Impact of Trade Liberalisation on Economic Growth in Switzerland
http://d.repec.org/n?u=RePEc:pra:mprapa:89884&r=all
The objective of this study is to analyse the effect of trade liberalization on economic growth in Switzerland using annual data from 1990 to 2014. In doing so, the study incorporated Foreign Direct Investment (FDI) and the Employment Rate (EMP) as additional variable to form a multivariate framework. The Auto-Regressive Distributive Lag (ARDL) test was used to test the existence of a long run relationship among the variables. The empirical findings indicated that Trade Openness had a positive and significant effect on economic growth in Switzerland. Thus, the study recommend that there is a need for the country to put strong initiative on adding value on her exports so as to compensate for imports.
Khobai, Hlalefang
Chitauro, Mishaelight
Trade liberalisation, Economic growth, Auto-regression Distribution Lag Model (ARDL), Co-integration, Switzerland
2018-11-07
Is Nepotism Inevitable Under Search and Matching Friction?
http://d.repec.org/n?u=RePEc:pra:mprapa:89836&r=all
The present article develops a search and matching framework to model political nepotism in the job market. The model argues that labor market friction generates incentives for the political leaders to provide nepotism under a democratic set up. Both the leaders optimally choose nepotism when the labor market friction is higher. It is shown that even for a relatively lesser labor market friction at least one leader would always choose nepotism. The results of the basic model remain robust in an extension where followers can pay a price and choose their allegiance, to any one of the political parties.
Mazumder, Debojyoti
Biswas, Rajit
search and matching, nepotism, political regime change
2018-11-02
Re-examining the Foreign direct investment, Renewable energy consumption and Economic growth nexus: Evidence from a new Bootstrap ARDL test for Cointegration
http://d.repec.org/n?u=RePEc:pra:mprapa:89975&r=all
This study re-examines the long-run relationship among foreign direct investment (FDI), renewable energy consumption (RE) and economic growth (GDP) for 9 Middle East and North Africa (MENA) countries over the period 1990–2015 using a newly developed cointegration test by McNown et al. (2018), the bootstrap autoregressive distributed lag (ARDL) which allows us to generate critical values for ARDL tests that are valid and appropriate for the specific data sets used and allow for endogeneity and feedback that may exist among the variables. In the long run analysis, we found evidence of cointegraion: (i) for Algeria, Armenia, Mauritania, and Tunisia when GDP is the dependant variable; (ii) for Egypt, Iran, Israel, Tunisia and Turkey when FDI is the dependent variable; and (iii) only for Iran, Morocco, and Tunisia when RE is the dependent variable. The short run Granger-causality analysis reveals varied nature of direction of causality between all variables and that is different among countries. This confirms that uniform policy recommendation relating to the causality between these variables may not work for these selected MENA countries.
Ghazouani, tarek
FDI; Renewable energy consumption; Economic growth; Bootstrap ARDL; MENA
2018-11-11
Regional Transfer Multipliers
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13304&r=all
A series of discontinuities in the allocation mechanism of federal transfers to municipal governments in Brazil allow us to identify the causal effect of public spending on local labor markets, using a 'fuzzy' Regression Discontinuity Design (RDD). Our estimates imply a cost per job of about 8,000 US dollars per year and a local income multiplier around two. The effect comes mostly from employment in services and is more pronounced among less financially developed municipalities.
Corbi, Raphael
Papaioannou, Elias
Surico, Paolo
'fuzzy' RD; employment; government spending; Natural Experiment; wages
2018-11
Generalising Conflict Networks
http://d.repec.org/n?u=RePEc:pra:mprapa:90001&r=all
We investigate the behaviour of agents in bilateral contests within arbitrary network structures when valuations and efficiencies are heterogenous. These parameters are interpreted as measures of strength. We provide conditions for when unique, pure strategy equilibria exist. When a player starts attacking one player more strongly, others join in on fighting the victim. Different efficiencies in fighting make players fight those of similar strength. Centrality of a player (having more enemies) makes a player weaker and her opponents are more likely to attack with more effort.
Cortes-Corrales, Sebastián
Gorny, Paul M.
Contest, conflict, networks, games on networks
2018-11-13
Repercussions of International Trade on the Market Power of Firms in Different Market Structures.
http://d.repec.org/n?u=RePEc:pra:mprapa:89889&r=all
The purpose of this paper is to provide an introduction of market power in different market structures and how this market power diminishes because of international trade and the effects on welfare. A review of relevant literature from Pugel (2012), McConnel Bruce and Flynn (2012) and Bernheim and Winston (2014) provides the effects of international trade on the market power conditions in different market structures and the effects on welfare. Asprilla, Berman, Cadot and Jaud (2016), Devereux and Lee (2001) and Krugman (1994) serve to provide further evidence through PTM literature, bilateral exchange rate shocks and protectionism.
Rashid, Muhammad Mustafa
Market Power, Market Structures, International Trade and Policy.
2018-06-19
The Relationship between Privatization and Corporate Taxation Policies
http://d.repec.org/n?u=RePEc:pra:mprapa:89784&r=all
This paper investigate how the corporate (profit) tax rate affects the optimal degree of privatization in a mixed duopoly, while introducing a minimum profit constraint for the private firm. Firstly, we show that the profit tax rate directly affects the behavior of the partially privatized firm and affects the behavior of the private firm through strategic interaction. In addition, we investigate the relationship between the optimal privatization policy and corporate tax policy, and find that the optimal degree of privatization increases with the corporate tax rate, regardless of whether the constraint is binding. The optimal degree of privatization decreases (increases) with the foreign ownership share in the private firm if the constraint is ineffective (effective). This result suggests that a minimum profit constraint can be crucial in the optimal privatization policy.
Liu, Yi
Matsumura, Toshihiro
Zeng, Chenhang
profit tax, minimum profit constraint, foreign ownership, optimal public ownership
2018-08
The return of religious Antisemitism? The evidence from World Values Survey data
http://d.repec.org/n?u=RePEc:pra:mprapa:90093&r=all
1) Background: This paper addresses the return of religious Antisemitism by a multivariate analysis of global opinion data from 28 countries. 2) Methods: For the lack of any available alternative we used the World Values Survey (WVS) Antisemitism study item: rejection of Jewish neighbors. It is closely correlated with the recent ADL-100 Index of Antisemitism for more than 100 countries. To test the combined effects of religion and background variables like gender, age, education, income and life satisfaction on Antisemitism, we applied the full range of multivariate analysis including promax factor analysis and multiple OLS regression. 3) Results: Although religion as such still seems to be connected with the phenomenon of Antisemitism, intervening variables such as restrictive attitudes on gender and the religion-state relationship play an important role. Western Evangelical and Oriental Christianity, Islam, Hinduism and Buddhism are performing badly on this account, and there is also a clear global North-South divide for these phenomena. 4) Conclusions: Challenging patriarchic gender ideologies and fundamentalist conceptions of the relationship between religion and state, which are important drivers of Antisemitism, will be an important task in the future. Multiculturalism must be aware of prejudice, patriarchy and religious fundamentalism in the global South.
Tausch, Arno
Relation of Economics to Social Values; Index Numbers and Aggregation; Labor; Economics of Minorities, Races, Indigenous Peoples, and Immigrants • Non-labor Discrimination; Economics of Gender • Non-labor Discrimination; Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - General, International, or Comparative; Religion
2018-11-17
Efek Ekonomis Penggunaan Mesin Pertanian (Traktor Roda Dua) Sebagai Mesin Pengolah Tanah Di Areal Pesawahan Cimencrang Jawa Barat
http://d.repec.org/n?u=RePEc:pra:mprapa:90098&r=all
Soil treatment for rice plants must be prepared two months before planting. Soil processing is intended to create better physical, chemical, and biological conditions of the soil to a certain depth to be suitable for plant growth. The study was conducted in the cimencrang paddy field with field observations and farmers' methods. The land preparation activity is divided into two stages, namely the first land preparation and the second land preparation. First processing, cut the soil and turn it over. Processing the second land, destroying the lumps produced from the first treatment. There are two things that can be analyzed from observations including economic analysis and tractor efficiency. Economic analysis includes costs incurred to process land taking into account the operational time required. The tractor efficiency is assessed from the use of the tractor in processing the land and the type of tractor used.
Rizky, Ahmad
Alia, Anzellika
Nafisyah, Cut
Maryani, Dina
H, Ikhsan
Sthevy, Jusstella
Michael, Muammar
Dwi, Masliah
economic effects, rice fields, agricultural machinery, tillage, two-wheel tractors.
2018
Firms’ Markup, Cost, and Price Changes when Policymakers Permit Collusion: Does Antitrust Immunity Matter?
http://d.repec.org/n?u=RePEc:pra:mprapa:89914&r=all
Airlines wanting to cooperatively set prices for their international air travel service must apply to the relevant authorities for antitrust immunity (ATI). Whether consumers, on net, benefit from a grant of ATI to partner airlines has caused much public debate. This paper investigates the impact of granting ATI to oneworld alliance members on their price, markup, and various measures of cost. The evidence suggests that implementation of the oneworld alliance without ATI did not have a statistically significant impact on the markup of products offered by the members, and there is no evidence that the subsequent grant of ATI to various members resulted in higher markups on their products. We find evidence suggesting that the grant of ATI facilitated a decrease in partner carriers’ marginal and fixed costs. Furthermore, member carriers’ price did not increase (decreased) in markets where their services do (do not) overlap, implying that consumers, on net, benefit from the grant of ATI in terms of price changes.
Gayle, Philip
Xie, Xin
Airline Competition; Strategic Alliances; Antitrust Immunity
2018-11-09
People do not adapt to income changes: A re-evaluation of the dynamic effects of (reference) income on life satisfaction with GSOEP and UKHLS data
http://d.repec.org/n?u=RePEc:pra:mprapa:89867&r=all
Do people adapt to changes in income? This paper shows that there is no evidence of adaptation to income in GSOEP (1984-2015) and UKHLS (1996-2015) data. Following the empirical approach of Vendrik (2013), I arrive at this surprising answer by estimating (dynamic) life satisfaction equations, in which I simultaneously enter contemporaneous and lagged terms for a respondent’s own household income and their estimated reference income. Additionally, I instrument for own income and include lags of a large set of controls. Furthermore, I find that people also do not adapt to changes in reference income. Instead, reference income effects may be subject to reinforcement over time. To explain my findings, a comprehensive account of the puzzling and often divergent results of Ferrer-i-Carbonell and Van Praag (2008), Binder and Coad (2010), Di Tella et al. (2010), and Pfaff (2013) is given. What was found to be adaptation to raw household income in these studies turns out to have been driven by reinforcement of an initially small negative effect of household size that grows large over time. Implications of this result for the estimation of equivalence scales with subjective data are discussed.
Kaiser, Caspar
subjective well-being; life satisfaction; adaptation; income comparisons; equivalence scales; GSOEP; BHPS; Understanding Society; UKHLS
2018-11-02
Where has the money gone?: The case of Value Added Tax revenue performance in Indonesia
http://d.repec.org/n?u=RePEc:pra:mprapa:89876&r=all
Since its introduction in 1983, Value Added Tax (VAT) has played an increasingly important role as one of the major sources of revenue for the Indonesian government. In the last two and a half decades, however, there is declining trend in its collection performance as a percentage of Gross Domestic Product. This study aims to explore the determinants of this declining trend in VAT revenue using macroeconomic data. These determinants are decomposed into three broad categories: tax expenditure policy, taxpayers’ noncompliance, and the share of aggregate consumption in the economy. It finds that the performance of VAT collection could mainly be explained by tax expenditure policies and the extent of noncompliance with tax laws. It is proposed that avenues of approach for reform could be directed toward reducing the scope of VAT exemptions, establishing a systematic approach in data collection and analysis to closely monitor trends and changes in taxpayers’ behavior, simplifying the tax system by setting a single rate that is imposed on a single type of consumption tax, and improving audit effectiveness by building trust between tax authority and taxpayers.
Iswahyudi, Heru
Indonesia, Value Added Tax, Tax Expenditure, Tax Revenue, Tax Noncompliance
2018-11-06
Immigration, Skill Acquisition and Fiscal Redistribution in a Search-Equilibrium Model
http://d.repec.org/n?u=RePEc:pra:mprapa:89897&r=all
Focusing on a selected group of 19 OECD countries, we analyze the effects of immigration on natives welfare, labor market outcomes and fiscal redistribution. To this end, we build and simulate a search and matching model that allows for endogenous natives skill acquisition and intergenerational transfers. The obtained results are then compared with different variations of our benchmark model, allowing us to assess to what extent natives skill adjustment and age composition affect the impact of immigration. Our comparative statics analysis suggests that when natives adjust their skill in response to immigration, they successfully avoid, under most scenarios, any potential displacement effect in the labor market. Moreover, taking into account age composition plays a key role in assessing the fiscal impact of immigration, which turns out to be positive when we include retired workers that receive intergenerational transfers. Finally, we find that, under any scenario, our model yields more optimistic welfare effects than a standard search model that abstracts from skill decision and intergenerational redistribution. These welfare effects are found to be overall particularly positive when the migration flows comprise high-skilled workers.
Ikhenaode, Bright Isaac
Immigration, Welfare, Unemployment, Skill Acquisition, Fiscal Redistribution.
2018-11-08
A review of more than one hundred Pareto-tail index estimators
http://d.repec.org/n?u=RePEc:pra:mprapa:90072&r=all
This paper reviews more than one hundred Pareto (and equivalent) tail index estimators. It focuses on univariate estimators for nontruncated data. We discuss basic ideas of these estimators and provide their analytical expressions. As samples from heavy-tailed distributions are analysed by researchers from various fields of science, the paper provides nontechnical explanations of the methods, which could be understood by researchers with intermediate skills in statistics. We also discuss strengths and weaknesses of the estimators, if they are known. The paper can be viewed as a catalog or a reference book on Pareto-tail index estimators.
Fedotenkov, Igor
Heavy tails, Pareto distribution, tail index, review, extreme value index
2018-11-15
Price momentum and the 1719-20 bubbles: A method to compare and interpret booms and crashes in asset markets
http://d.repec.org/n?u=RePEc:pra:mprapa:89888&r=all
This paper attempts to address one major problem with bubble studies: the difficulty to rigorously compare assets bubbles (that is to say compare them via quantitative data, rather than simply anecdotal evidence). The idea of the paper is to use a metric that is not the level of price itself, but that is connected to it. This metric is price momentum (i.e. the magnitude and speed of price changes). Momentum is measured with a technical indicator: the Relative Strength Index (RSI). The RSI is popular among traders, yet it is not normally used as a tool of comparison. In particular, there appears to be no academic study that has hitherto employed the RSI as a metric to compare different booms and crashes. Likewise, it seems that the RSI was never applied to early modern markets (such as the Mississippi and South Sea Bubbles), or to early 20th century markets (such as the 1929 crash). The paper does all this (based on historical securities prices). Furthermore, it develops news concepts and metrics (such as “strong momentum with low volatility”, “momentum efficiency”, and accumulated RSI readings) that are connected to the notion of momentum. These concepts, in turn, are interpreted through the lens of archival evidence. The result is a new method of analysis – which is not concerned with market forecasting, but only with comparison and historical interpretation – that sheds new light on the 1719 20 bubbles themselves.
Condorelli, Stefano
Financial history, South Sea Bubble, Mississippi Bubble, Dutch Wind Trade, Relative Strength Index, momentum, volatility, stock market bubbles and crashes, euphoria
2018-09
Taxation and Market Power in the Legal Marijuana Industry
http://d.repec.org/n?u=RePEc:pra:mprapa:90085&r=all
In 2012 the state of Washington created a legal framework for production and retail sales of marijuana. Nine other U.S. states and Canada have followed. These states hope to generate tax revenue for their state budgets while limiting harms associated with marijuana consumption. We use a unique administrative dataset containing all transactions in the history of the industry in Washington to evaluate the effectiveness of different tax and regulatory policies under consideration by policymakers and study the role of imperfect competition in determining these results. We examine 3 main research questions. First, how effective is Washington’s excise tax at raising revenue? With the nation’s highest tax rate on marijuana, is Washington maximizing revenue or potentially overtaxing, leading to reduced legal sales and lower tax revenue. Second, what is the incidence of taxes in this industry? Finally, most states have restricted entry, resulting in firms with substantial market power. What is the role of imperfect competition in studying these basic questions on tax policy? We combine structural methods and a reduced form sufficient statistic approach to show a number of results. First, Washington’s 37% excise tax is still on the upward sloping portion of the Laffer curve and state revenue could be substantially higher with a higher tax rate. The amount of revenue generated by a tax increase is significantly larger due to retailer market power than it would be under perfect competition. In addition, these taxes are primarily borne by consumers and not by firms, and there is a large social cost associated with each dollar raised.
Hollenbeck, Brett
Uetake, Kosuke
tax incidence, marijuana, pass-through, imperfect competition, regulation
2018-11-12
A non-linear post-Keynesian Goodwin-type endogenous model of the cycle for the USA
http://d.repec.org/n?u=RePEc:pra:mprapa:90036&r=all
Since its original formulation, Goodwin’s (1967) approach became a standard endogenous business cycles model. However, despite its elegant mathematical formulation, the empirical estimation of Goodwin-type models has not always ended up in success. The present paper uses the so-called Bhaduri-Marglin accumulation function in Goodwin’s original growth cycle model. Based on its derived equations of motion and dynamic properties, we econometrically estimate the proposed model for the case of the US economy in the time period 1960-2012, using structural breaks. The empirical estimation is very satisfactory and, in general terms, consistent with economic theory and the findings by other researchers on the US economy. The results of this work suggest that the proposed approach is an appropriate vehicle for expanding and improving traditional Goodwin-type models.
Konstantakis, Konstantinos N.
Michaelides, Panayotis G.
Mariolis, Theodore
Bhaduri-Marglin accumulation function, Goodwin type models, US economy JEL classification:
2018
Property Rights and Intellectual Property Protection, GDP growth and Well-Being in Latin America
http://d.repec.org/n?u=RePEc:pra:mprapa:90034&r=all
A central argument for increased protections of property rights (PR) is the role they play in encouraging economic transactions, investment and economic growth. Likewise, the utilitarian justification of intellectual property laws is that such rights promote creative inventions and innovation, and thus can make a nation better off. A further argument is psychological: it has also been argued (though rarely tested) that enhanced rights contribute to increases in well-being enjoyed by a county’s citizens. Many Latin American countries have made efforts to improve property rights (and their enforcement) in the recent past, with varying success. Using three data sources (the Latinobarometer, the World Bank, and the World Economic Forum’s Global Competitive Index), this investigation considers the relationship between property rights and intellectual property protection, economic growth, and well-being. The results, which are heterogeneous with respect to labour force status, suggest that policy makers in Latin America should pursue improvements in property rights if they wish to improve citizen well-being while also promoting economic growth.
Lahsen, Amina. A
Piper, Alan T.
Property rights; Intellectual property protection; Economic Growth; Latin America; Life Satisfaction; Latinobarometer
2018-11
Endogenous constraints, coefficients of economic distance, and economic performance of African countries – An exploratory essay
http://d.repec.org/n?u=RePEc:pra:mprapa:90065&r=all
Existing literature has overstressed the importance of exogenous constraints in the economic performance of African countries at the expense of endogenous constraints, although the latter are longer-lasting and more self-propagating than the former. In this exploratory essay I put endogenous factors upfront, and introduce and define the concept of economic distance. I argue that the coefficient of economic distance is a better measure of what is going on than things like the Africa dummy, for example. The evidence I consider suggests that policy and future research will benefit from focused studies of endogenous constraints on economic performance. The essay is incomplete without its empirical complement, but it succeeds in holding up a mirror in front of these countries. The implication is that continued emphasis on exogenous constraints is a misallocation of scarce policy and research resources.
Amavilah, Voxi Heinrich
Endogenous constraints; Economic distance; coefficient of economic distance; endogenous growth; developing countries; African countries
2018-11-15
Some Principles for Regulating Cyber Risk
http://d.repec.org/n?u=RePEc:cpr:ceprdp:13324&r=all
We explain why cyber risk differs from other operational risks in the financial sector. The form of cyber shocks differs because of their intent, probability of success, possibility of a hidden phase and evolving form of the risks. The impact differs because problems can spread quickly and because uncertainty over the possibility of a hidden phase can impact responses. We explain why private incentives to attend to these risks may differ from societies' preferences and develop six (micro- and macroprudential) regulatory principles to deal with cyber risk.
Kashyap, Anil K
Wetherilt, Anne
cyber risk; macroprudential regulation; stress test
2018-11
A latent class analysis towards stability and changes in breadwinning patterns among coupled households
http://d.repec.org/n?u=RePEc:pra:mprapa:89950&r=all
We examine how couples'breadwinning patterns are classified and how they have changed over the past four decades during which we have seen increase in women's labor force participation. We explore how the latent variable of spousal breadwinning types is associated with the socioeconomic statuses. To this end, we consider a latent class model especially tailored for an underlying ordinal response derived by comparing two continuous variables. We develop method to estimate the model parameters accounting for the informative sampling design and missing responses. We estimate the measurement model parameters by means of a weighted likelihood function maximised through the Expectation-Maximization algorithm. In order to determine the suitable number of latent classes we rely on the Akaike Information Criterion. Then, fixing the obtained parameters we estimate the latent model parameters by adding the full set of covariates. We make predictions on the basis of the maximum a-posteriori probability. Using data from the Japanese surveys covering the period from 1985 to 2015 breadwinning patterns are examined. Our model discloses two latent classes, each of which represents distinct breadwinning types, namely ``traditional couples" and ``new couples". Interestingly, the two-class pattern persists across the four waves covering the past 40 years.
Nakai, Miki
Pennoni, Fulvia
Akaike Information Criterion, Expectation-Maximization algorithm, Gender Inequality, Household Income Composition, Latent class model.
2018-11
Economic impacts of El Niño Southern Oscillation: evidence from the Colombian coffee market
http://d.repec.org/n?u=RePEc:pra:mprapa:89984&r=all
El Niño Southern Oscillation (ENSO) is a naturally occurring phenomenon that affects weather around the world. Past ENSO episodes have had severe impacts on the economy of Colombia. We study the influence of ENSO on Colombian coffee production, exports, and price. Our structural econometric specification is consistent with an economic model of the market for Colombian coffee which, in the short run, is characterized by a downward-sloping demand curve and by a vertical supply curve. We show that El Niño (i.e., positive shocks to ENSO) is beneficial for Colombian production and exports and decreases the real price of Colombian coffee. On the contrary, La Niña (i.e., negative shocks to ENSO) depresses Colombian coffee production and exports and increases price. However, the overall impact of ENSO shocks is small. Both in the short run and in the long run, shocks to international demand for Colombian coffee are more relevant than supply-side shocks in Colombia in explaining the dynamics of the price of Colombian coffee. Our results suggest that a given coffee price shock can have beneficial, detrimental, or negligible effects on the Colombian economy, depending on its underlying cause. As a consequence, policy responses to coffee price shocks should be designed by looking at the causes of the shocks.
Bastianin, Andrea
Lanza, Alessandro
Manera, Matteo
Coffee; Colombia; El Niño; ENSO; La Niña; Structural VAR
2018
Revisiting Employee - Guest Interactions in Hotels: An Analysis of Critical Incidents
http://d.repec.org/n?u=RePEc:pra:mprapa:90101&r=all
The study was conducted to find out the positive and/or negative effects that hotel employees may have upon hotel guests’ experiences during their stay. Using the critical incident technique (CIT), data were obtained from 105 guests (a total of 174 incidents) staying in two different 5-star hotels that have similar characteristics in terms of type, price, ownership and concept in Bodrum, Turkey. The incidents were primarily categorized as positive and negative and afterward the incidents from two categories were compared to each other in terms of three main process of hotel accommodation as check-in, accommodation and check-out. Despite the fact that most hotels currently place emphasis on employee-guest interactions –under the concept of service quality or customer satisfaction-, the findings revealed that there were still a number of negative incidents that caused customer dissatisfaction and managerial implications were needed in hotels to minimize negative incidents and maximize the positive ones.
Yilmaz, Özgür Devrim
Critical incidents; Hotel; Employee-guest interaction; Employee behavior; Customer satisfaction
2018-03-07
Measuring Long-Run Price Elasticities in Urban Travel Demand
http://d.repec.org/n?u=RePEc:pra:mprapa:90059&r=all
This paper develops a structural model of urban travel to estimate long-run price elasticities. A dynamic discrete choice demand model with switching costs is estimated, using a panel dataset with public market-level data on automobile and public transit use for Chicago. The estimated model shows that long-run own- (automobile) and cross- (transit) price elasticities are more elastic than short-run elasticities, and that elasticity estimates from static and myopic models are downward biased. The estimated model is used to evaluate the response to a gasoline tax. Static and myopic models mismeasure long-run substitution patterns, and could lead to incorrect policy decisions.
Donna, Javier D.
Long-run price elasticities, Dynamic demand travel, Hysteresis
2018-11-05
FDI and International Collusion
http://d.repec.org/n?u=RePEc:cde:cdewps:295&r=all
We develop a supergame model of collusion between price-setting oligopolists when the trade between countries involves per-unit trade cost and FDI requires a fixed cost of setting up a subsidiary in a foreign country. We demonstrate that cross hauling of FDI may facilitate collusion based on territorial allocation of markets. Whenever FDI is not helpful for sustaining collusion, the collusive arrangement involves no FDI at all. With asymmetric number of home firms or with different sizes of the markets, FDI may facilitate international collusion at lower levels of trade costs and thus our analysis also throws some light on the empirical puzzle regarding the trade liberalisation and FDI flows observed since the 1990s.
Uday Bhanu Sinha
Foreign direct investment, collusion, multimarket contact, cross hauling of FDI, price competition, homogenous good.
2018-12
A new statistical system for the European Union
http://d.repec.org/n?u=RePEc:bre:esslec:28661&r=all
Quality statistics are fundamental to economic policy. In the European Union a number of critical official statistics are the basis for economic surveillance of member states. These statistics are the product of a system in which Eurostat relies on the statistical offices of EU countries. This essay shows how this system is no longer adequate, argues that a more efficient, integrated approach is required, and sets out a model that would deliver the statistics the European Union needs.
Andreas Georgiou
2018-12
The Value of Food Certification and Labels for Consumers in Québec (Canada)
http://d.repec.org/n?u=RePEc:cir:cirpro:2018rp-11&r=all
Consumers’ habits regarding food are evolving. They are increasingly concerned about the impact of their diet on their health, but also on the environment and on the condition of the producers’ lives. Recent scandals regarding the agri-food industry and recurrent outbreaks of foodborne illness have also undermined the consumers’ trust in the quality of the food they buy. Globalization of the food supply chain and the increasing amount of processed food products make this judgment even more difficult. The development of label claims and certifications by the industry is intended to meet the new consumers’ expectations and help them in their decision-making. The main objective of this study was, therefore, to assess the value of food certification and label for consumers. To achieve this goal, a quantitative methodology based on a questionnaire has been developed. The survey has been designed based on the literature as well as consultations with key stakeholders from the agri-food industry. It covers three research themes: 1) perceptions and consumer behavior, 2) knowledge of the certification process and the potential for certification development and 3) use and influence of information sources. Administered by a polling and market research collaborator in January 2018, the questionnaire has been answered by a representative sample of the population (N = 1032). Les habitudes des consommateurs en matière de d’alimentation évoluent. Ils sont de plus en plus préoccupés par l'impact de leur alimentation sur leur santé, mais aussi sur l'environnement et sur les conditions de vie des producteurs. Les récents scandales concernant l'industrie agroalimentaire et les épidémies récurrentes de maladies d'origine alimentaire ont également miné la confiance des consommateurs dans la qualité de la nourriture qu'ils achètent. La mondialisation de la chaîne d'approvisionnement alimentaire et la quantité croissante de produits alimentaires transformés rendent ce jugement encore plus difficile. Le développement des allégations et certifications par l'industrie vise à répondre aux attentes des nouveaux consommateurs et à les aider dans leur prise de décision. L'objectif principal de cette étude était donc d'évaluer la valeur de la certification alimentaire et des labels pour les consommateurs. Pour atteindre cet objectif, une méthodologie quantitative basée sur un questionnaire a été développée. L'enquête a été conçue sur la base d’une revue de la littérature ainsi que sur des consultations avec des intervenants clés de l'industrie agroalimentaire. Il couvre trois thèmes de recherche: 1) les perceptions et le comportement du consommateur, 2) la connaissance du processus de certification et le potentiel de développement de la certification et 3) l'utilisation et l'influence des sources d'information. Les résultats présentés dans le rapport s’appuient sur une enquête administrée en janvier 2018 auprès d’un échantillon de 1032 répondants représentatif de la population du Québec.
Nathalie de Marcellis-Warin
Ingrid Peignier
Yoann Guntzburger
2018-05-30
Forecast errors and monetary policy normalisation in the euro area
http://d.repec.org/n?u=RePEc:bre:polcon:28816&r=all
This Policy Contribution was prepared for the Nomura Foundation’s Macro Economy Research Conference - ‘Monetary Policy Normalization Ten Years after the Great Recession’, 24 October 2018, Tokyo. Financial support from the Nomura Foundation is gratefully acknowledged. We consider the lessons of the recent monetary policy normalisation experiences of Sweden, the United States and the United Kingdom, and analyse the European Central Bank’s forecasting track record and possible factors that might explain the forecast errors. From this analysis, we draw the following main conclusions - Monetary tightening involves major risks when the evidence of an improved inflation outlook is not sufficiently strong; it is better to err on the side of a possible inflation overshoot after a long period of undershooting; Inadequate forward guidance can cause market turbulence; Market participants might disregard forward guidance after large systematic forecast errors; Terminating net asset purchases might not increase long-term rates, though it might have an impact on other asset prices because of the lack of portfolio rebalancing; The ECB has made huge and systematic forecasting errors in the past five years, indicating that some of the behavioural relationships in ECB forecasting models are mis-specified. The ECB is not the only institution to suffer from incorrect forecasts and there should be broader debate on forecasting practices. However, the ECB’s forecast errors and its inability to lift core inflation above 1 percent have major implications; Market-based inflation expectations have already started to fall in the euro area, suggesting that the trust has weakened in the ECB’s ability to reach its inflation aim of the below but close to two percent over the medium term; More time is needed to see if the forecasting failures of the past five years were driven by factors whose impact will gradually fade away, or if the ECB’s ability to lift core inflation has been compromised; In the meantime, a very cautious approach to monetary policy normalisation is recommended. A rate increase is only recommended after a significant increase in actual core inflation. This intention should be made clear in the ECB’s forward guidance; If forecasting failures continue and core inflation does not approach two percent, the ECB’s credibility could be undermined, making necessary a discussion on either the deployment of new tools to influence core inflation, or a possible revision of the ECB’s inflation goal; In the new ‘normal’ the natural rate of interest might remain low, and thereby central bank balance sheet policies will likely became part of the regular toolkit; Monetary policy tools are ill-suited to address financial stability concerns in general, especially in the euro area. Financial stability concerns should not play a role in monetary policy normalisation. Instead, country-specific macroprudential policy should complement micro-prudential supervision and regulation.
Zsolt Darvas
2018-12
Risk sensitivity and risk shifting in banking regulation
http://d.repec.org/n?u=RePEc:boe:finsta:0044&r=all
The financial crisis exposed enormous failures of risk management by financial institutions and of the authorities’ regulation and supervision of these institutions. Reforms introduced as part of Basel III have tackled some of the most important fault‐lines. As the focus now shifts toward the implementation and evaluation of these reforms, it will be essential to assess where the balance has been struck between the robustness and the risk sensitivity of the capital framework. This paper contributes to this assessment by stepping back from the details of the recent reforms and instead taking a bird’s eye view on the fundamental tradeoffs that may exist between robustness, complexity, and risk sensitivity. We review the history of risk sensitivity in capital standards and assess whether a higher degree of risk sensitivity necessarily leads to a better measurement of risk. We also provide evidence that the more risk‐sensitive Basel II framework may have reduced banks’ incentives to engage in higher‐risk mortgage lending in the UK. Our analysis suggests the need for a robust regulatory framework with several complementary standards interacting and reinforcing each other, even if, prima facie, subjecting banks to a number of regulatory constraints adds to complexity.
Hinterschweiger, Marc
Neumann, Tobias
Saporta, Victoria
Basel 2; capital regulation; risk sensitivity; risk shifting
2018-07-04
Macroprudential capital regulation in general equilibrium
http://d.repec.org/n?u=RePEc:boe:boeewp:0770&r=all
We examine macroprudential bank capital policy in a macroeconomic model with a financial accelerator originating in the banking sector. Under Ramsey-optimal policy, the bank capital buffer tracks closely a model-based measure of the credit gap, defined as the gap between equilibrium credit in the economy featuring financial frictions and that in a hypothetical frictionless economy. Simple rules that vary the capital buffer in response to the credit gap perform worse than Ramsey policy, but only modestly so. When monetary policy controls inflation less aggressively, optimal macroprudential responses are smaller. Optimal macroprudential policy operates at a lower frequency than monetary policy.
Nelson, Benjamin
Pinter, Gabor
Macroprudential policy; bank capital; monetary policy
2018-12-07
Economic Resilience and the Dynamics of Capital Stock
http://d.repec.org/n?u=RePEc:ctl:louvir:2018017&r=all
The role of capital stock in measuring resilience is investigated. Based on the current and potential growth paths we propose new indexes to better measure the characteristics associated with resilience: adaptability and resistance to shocks. The dynamics of capital instead of employment is used as a proxy for economic welfare, considered ideal to represent the evolution of economic systems. The two series of capital stock for the US and Spanish economies, associated with the short-run and the long-run trajectories, allows us to empirically compute the indexes and draw conclusions about their ability to resist shocks and absorb their effects.
F. J. Escribá-Pérez
M. J. Murgui-García
J. R. Ruiz-Tamarit
Adaptability, Capital, Growth, Resilience, Resistance
2018-12-12
The Perversion of Land Reform by Landed Elites: Power, Inequality and Development in Colombia
http://d.repec.org/n?u=RePEc:col:000178:017015&r=all
Over two centuries, Colombia transferred vast quantities of land, equivalent to the entire UK landmass, mainly to landless peasants. And yet Colombia retains one of the highest concentrations of land ownership in the world. Why? We show that land reform’s effects are highly bimodal. Most of Colombia’s 1100+ municipalities lack a landed elite. Here, rural properties grew larger, land inequality fell, and development improved. But where land is concentrated in the hands of a rural elite, distributed land was diverted to bigger farms, resulting in fewer small and more large farms, greater land dispersion, and lower levels of development. We show that these effects – positive and negative – flow through political participation, competition, and policy-making. Landed elites use patron-client ties to distort local and national politics to their benefit. Land reform’s secondary effects, on the distribution of power, are more important than its primary effects on the distribution of land. *** Desde la independencia, Colombia ha transferido una vasta cantidad de tierra, equivalente al área del Reino Unido, principalmente a campesinos desterrados. Sin embargo, Colombia mantiene hoy en día uno de los más altos niveles de concentración de la tenencia de la tierra en el mundo. ¿Por qué? En este artículo mostramos que los efectos de la reforma agraria son bimodales. La mayoría de los más de 1100 municipios no cuentan con una élite terrateniente. En estos municipios, la propiedad rural creció y la desigualdad de la tierra se redujo. Pero, donde la tierra está concentrada en manos de una élite rural, la distribución de la tierra se orientó hacia los beneficios de los grandes terratenientes, con mayor dispersión en la tierra y menor nivel de desarrollo. Mostramos que estos efectos –positivos y negativos- se vinculan a la participación política, la competencia y la implementación de políticas. La élite terrateniente utiliza los vínculos patrón-cliente para distorsionar los beneficios de la política local y nacional. Los efectos secundarios de la reforma agraria en la distribución del poder, son más importantes que los efectos primarios en la distribución de la tierra.
Marta-Juanita Villaveces
Jean-Paul Faguet
Fabio Sánchez
Land reform, inequality, development, latifundia, political competition, Colombia
2018-12-07
Are the poor so present-biased?
http://d.repec.org/n?u=RePEc:csa:wpaper:2018-19&r=all
Estimates of “present-bias” among the poor may be exaggerated if poor individuals are credit-constrained and expect to have greater liquidity in the future. I conduct an experiment in rural Pakistan which provides causal evidence of this e?ect. I use windfalls to generate fully exogenous variation in subjects’ liquidity constraints. I show that ?uctuating liquidity has a signi?cant and sizeable e?ect on measures of time-inconsistency, which does not operate via cognitive functioning. Importantly, I establish that the causation runs from tighter liquidity constraints to appearing “present-biased” — rather than truly present-biased individuals making choices which lead to tighter liquidity constraints.
Rachel Cassidy
2018
Excess Capacity and Effectiveness of Policy Interventions: Evidence from the Cement Industry
http://d.repec.org/n?u=RePEc:cnn:wpaper:18-005e&r=all
Strategic interaction among firms may hinder the reduction of excess capacity in a declining industry. Policy interventions that attempt to reduce excess capacity may increase efficiency by accelerating the capital adjustment but may decrease efficiency by increasing the market power of firms and/or by distorting firms' divestment decisions. We study capacity coordination policies-forcing firms to reduce their capacity simultaneously-applied to the Japanese cement industry. Estimation results suggest that these interventions (i) did not increase market power because reduction in capacity resulted in higher utilization of the remaining plants, and (ii) did not distort firms' scrappage decisions.
Tetsuji Okazaki
Ken Onishi
Naoki Wakamori
2018-12
La pobreza en Riohacha: diagnóstico, análisis y propuestas
http://d.repec.org/n?u=RePEc:bdr:region:275&r=all
El objetivo número uno de desarrollo sostenible de las Naciones Unidas dicta que para el año 2030 se debe erradicar la pobreza en todas sus formas y dimensiones en todo el mundo. Colombia ha realizado avances en esta línea y las cifras muestran que entre 2010 y 2017 la pobreza monetaria se redujo al pasar del 37,2% al 26,9%. Sin embargo, aún existen rezagos en esta materia y prueba de ello es Riohacha, ciudad que mantuvo constante su incidencia en 46,9% para este periodo de tiempo. El presente artículo realiza un diagnóstico detallado de la pobreza en la capital de La Guajira y presenta las inversiones necesarias para avanzar en su superación. Los principales indicadores revelan que el empleo informal, el bajo logro educativo y la falta de acceso a servicios básicos son las privaciones con mayor recurrencia en los hogares. Además, estas se concentran en la periferia y la zona rural dispersa, en donde coinciden con un alto porcentaje de población indígena. A partir de los resultados, se propone una intervención integral en cuatro sectores: educación, empleo, vivienda y servicios públicos, cuyo costo total se estima en 372,7 millones de dólares para el periodo comprendido entre 2019 y 2030. **** ABSTRACT: The number one sustainable development goal of the United Nations establishes that, by 2030, poverty should end in all its forms everywhere in the world. Colombia has made progress in this area: between 2010 and 2017, monetary poverty in the country fell from 37.2% to 26.9%. However, there are still challenges to overcome, and proof of this is Riohacha, a city that maintained poverty rate constant at 46.9% during this period. The main objective of this document is to present a detailed study of poverty in Riohacha and the necessary investments to advance in its solution. The main indicators reveal that informal employment, low educational attainment, and lack of access to basic services, are the most recurrent deprivations in households. In addition, these are concentrated in the periphery and the dispersed rural area, where there is also a large percentage of indigenous population. Based on the results, an intervention is proposed in four sectors: education, employment, housing, and public services. The total cost of the proposal is estimated at 372.7 million dollars for the period between 2019 and 2030.
Diana Ricciulli-Marín
César Arismendi
Eduardo Romero
Riohacha, pobreza, políticas públicas, poverty, public policy
2018-12
Short-time work in the Great Recession: firm-level evidence from 20 EU countries
http://d.repec.org/n?u=RePEc:boe:boeewp:0771&r=all
Using firm-level data from a large-scale European survey among 20 countries, we analyse the determinants of firms using short-time work (STW). We show that firms are more likely to use STW in case of negative demand shocks. We show that STW schemes are more likely to be used by firms with high degrees of firm-specific human capital, high firing costs, and operating in countries with stringent employment protection legislation and a high degree of downward nominal wage rigidity. STW use is higher in countries with formalised schemes and in countries where these schemes were extended in response to the recent crisis. On the wider economic impact of STW, we show that firms using the schemes are significantly less likely to lay off permanent workers in response to a negative shock, with no impact for temporary workers. Relating our STW take-up measure in the micro data to aggregate data on employment and output trends, we show that sectors with a high STW take-up exhibit significantly less cyclical variation in employment.
Lydon, Reamonn
Mathä, Thomas
Millard, Stephen
Firms; survey; crisis; short-time work; wages; recession
2018-12-07
Large scale urban projects: the state and gentrification in the belo horizonte metropolitan region
http://d.repec.org/n?u=RePEc:cdp:texdis:td594&r=all
This paper assesses the degree to which a series of large-scale urban projects along the North Axis of the Metropolitan Region of Belo Horizonte (MRBH), Brazil, may have triggered a process of gentrification since 2004. The North Axis is the poorest zone of the MRBH and it has been the subject of multiple development and investments plans, under the concept of “Aerotropolis” – the globalized metropolis that has an international airport as the anchor for its development. Although initially proposed as a Public-Private Partnerships (PPPs), state government had the central role in these projects and funded almost all. These investments include a series of large-scale urban projects, including the Green Line (Linha Verde) corridor, which connects the central city to the International Airport Tancredo Neves, and the relocation of the administrative offices of the state government (Cidade Administrativa de Minas Gerais, CAMG). All these plans and developments were sustained by major investments in road and service infrastructure, including a Bus Rapid Transit (BRT) system. Area plans and investments have likely increased land values and rents in the area, sparking concern about the gentrification of low-income households in and around the area. Responding to an academic and policy need to assess how and to what degree large-scale urban projects trigger processes of gentrification, the paper exposes a quasi-experimental, mixed-methods research to identify whether and why land values have increased, and if a relationship can be established between those increases and the displacement of low-income households who had made the area their home. This research used a number of datasets to grasp the empirical evidences as well as case studies (fieldwork to generate a robust explanation of the forces and relationships behind and dynamics of the area’s potential gentrification). Empirical results indicate that the large-scale urban projects such as the CAMG may have increased the land values in the study area at nearly 17%. On the other hand, the “MOVE” BRT system may have caused a 14% price drop in the study area. Regarding the potential gentrification process, empirical results rejected this hypothesis, mainly because the study area is a consolidated area and the high-income groups have not being attracted to the area. The study generated the conditions to design and implement another study, focused more specifically on land value increments indeed generated by area plans and investments, covering a wider area and the range of options local governments could consider recovering those increments. Moreover, more research is necessary to clarify the effects of BRT systems on Latin American cities, a key concern on urban policy nowadays.
Roberto Luís de Melo Monte-Mór
Renan Pereira Almeida
Marcelo de Brito Brandão
infrastructure, land markets, spatial segregation, economic development.
2018-12
Inference in Second-Order Identified Models
http://d.repec.org/n?u=RePEc:cir:cirwor:2018s-36&r=all
We explore the local power properties of different test statistics for conducting inference in moment condition models that only identify the parameters locally to second order. We consider the conventional Wald and LM statistics, and also the Generalized Anderson Rubin (GAR) statistic (Anderson and Rubin, 1949; Dufour, 1997; Staiger and Stock, 1997; Stock and Wright, 2000), KLM statistic (Kleibergen, 2002, 2005) and the GMM extension of Moreira’s (2003) (GMM-M) conditional likelihood ratio statistic. The GAR, KLM and GMM-M statistics are so-called “identification robust” since their (conditional) limiting distribution is the same under first-order, weak and therefore also second order identification. For inference about the model specification, we consider the identification-robust J statistic (Kleibergen, 2005) and the GAR statistic. Interestingly, we find that the limiting distribution of the Wald statistic under local alternatives not only de-pends on the distance to the null hypothesis but also on the convergence rate of the Jacobian. We specifically analyze two empirically relevant models with second order identification. In the panel autoregressive model of order one, our analysis indicates that the Wald test of a unit root value of the autoregressive parameter has better power compared to the corresponding GAR test which, in turn, dominates the KLM, GMM-M and LM tests. For the conditionally heteroskedastic factor model, we compare Kleibergen’s (2005) J and the GAR statistics to Hansen’s (1982) overidentifying restrictions test (previously analyzed in this context by Dovonon and Renault, 2013) and find the power ranking depends on the sample size. Collectively, our results suggest that tests with meaningful power can be conducted in second-order identified models.
Prosper Dovonon
Frank Kleibergen (Sans nom)
Alastair Hall
Generalized Method of Moments estimation,First-order identification failure,Identification-robust inference,
2018-12-17
2017 Methods-of-Payment Survey: Sample Calibration and Variance Estimation
http://d.repec.org/n?u=RePEc:bca:bocatr:114&r=all
This technical report describes sampling, weighting and variance estimation for the Bank of Canada’s 2017 Methods-of-Payment Survey. Under quota sampling, a raking ratio method is implemented to generate weights with both post-stratification and nonparametric nonresponse weight adjustments. In the end, we estimate variances of weighted means and proportions using bootstrap replicate survey weights. Compared with probability sampling, we find that (i) strong assumptions are required to reduce bias when probabilities of selection are unknown, and (ii) multiple weight adjustments for bias reduction inflate variance. Therefore, it is important to focus more on bias than on variance in the context of nonprobability sampling.
Heng Chen
Marie-Hélène Felt
Christopher Henry
Econometric and statistical methods
2018
The Evolution of Inflation Targeting In Australia
http://d.repec.org/n?u=RePEc:auu:hpaper:072&r=all
When inflation targeting was adopted in Australia is disputed. Some believe it commenced in March 1993 when the Governor of the Reserve Bank (Bernie Fraser) referred in a speech to the desirability of maintaining inflation between 2-3 per cent a year. However, he made a similar remark in a speech in August 1992. Some overseas authorities assert that inflation targeting began in 1994, referring to a speech that Fraser made in September of that year when he declared that 2-3 per cent inflation ‘is a reasonable goal for monetary policy’. The year 1994 is also significant because the Treasurer (Ralph Willis) stated in parliament that the government and the Bank had an inflation target of 2-3 per cent. Paul Keating, on the other hand, prefers 1995 as the commencing date, when he and the Secretary of the ACTU (Bill Kelty) included an inflation target of 2-3 per cent in the final Accord agreement between the government and the trade union movement. Another possible starting date is 1996 when the first Statement on the Conduct of Monetary Policy, signed by the Treasurer (Peter Costello) and the incoming Governor of the Reserve Bank (Ian Macfarlane), endorsed ‘the Reserve Bank[‘s]…objective of keeping underlying inflation between 2 and 3 per cent, on average, over the cycle.’ In all probability, there is no definitive starting date for the commencement of inflation targeting in Australia. Rather, its adoption was the result of an evolutionary process, like many other developments in the history of central banking.
Selwyn Cornish
2018-11
Measuring Venezuelan Emigration with Twitter
http://d.repec.org/n?u=RePEc:cid:wpfacu:342&r=all
Venezuela has seen an unprecedented exodus of people in recent months. In response to a dramatic economic downturn in which inflation is soaring, oil production tanking, and a humanitarian catastrophe unfolding, many Venezuelans are seeking refuge in neighboring countries. However, the lack of official numbers on emigration from the Venezuelan government, and receiving countries largely refusing to acknowledge a refugee status for affected people, it has been difficult to quantify the magnitude of this crisis. In this note we document how we use data from the social media service Twitter to measure the emigration of people from Venezuela. Using a simple statistical model that allows us to correct for a sampling bias in the data, we estimate that up to 2.9 million Venezuelans have left the country in the past year.
Ricardo Hausmann
Julian Hinz
Muhammed A. Yildirim
migration, social media
2018-05
The Gold Standard and the Great Depression: a Dynamic General Equilibrium Model
http://d.repec.org/n?u=RePEc:ctl:louvir:2018016&r=all
Was the Gold Standard a major determinant of the onset and the protracted character of the the Great Depression of the 1930s in the United States and Worldwide? In this paper, we model the ‘Gold-Standard hypothesis’ in a dynamic general equilibrium framework. We show that encompassing the international and monetary dimensions of the Great Depression is important to understand what happened in the 1930s, especially outside the United States. Contrary to what is often maintained in the literature, our results suggest that the vague of successive nominal exchange rate devaluations coupled with the monetary policy implemented in the United States did not act as a relief. On the contrary, they made the Depression worse.
Luca Pensieroso
Romain Restout
Gold Standard, Great Depression, Dynamic General Equilibrium
2018-12-03
Municipal Fiscal Health in Colombian Main Cities
http://d.repec.org/n?u=RePEc:bdr:region:274&r=all
Local governments are primary providers of basic services to their communities, and any decision they make will echo in the economy as a whole. That is why healthy and sustainable local public finances should be a national priority. With the purpose of contributing to the discussion on subnational fiscal health, a recently developed approach by Slack (2017) is applied to the 23 main Colombian cities. After preparing a brief and general profile of each city, five dimensions are analyzed in-depth: external, financial, tax and revenue, debt, and infrastructure. Results highlight the high complexity of what making a fiscal health diagnosis of local governments implies. Colombian cities do not seem to face profound fiscal health issues. Nevertheless, there is evidence of regional differences, where coastal lagged behind Caribbean and Pacific cities seem to suffer of structural and long-term weaknesses. On the other hand, inner Eastern and Central cities’ issues are more related to cash-flows and shortterm sustainability. **** RESUMEN: Los gobiernos locales son los principales proveedores de los servicios básicos en sus comunidades y, por tanto, cualquier decisión que adopten se verá reflejada en la economía como un todo. Esta es la razón por la que finanzas públicas locales sostenibles y saludables deberían ser una prioridad nacional. Con el propósito de contribuir a la discusión sobre salud fiscal subnacional, en este documento se aplica, para las principales ciudades de Colombia, la metodología reciente de Slack (2017) en la construcción de indicadores de salud fiscal. Luego de preparer un perfil general de cada una de las ciudades, se analizan más detalladamente el comportamiento de indicadores en cinco dimensiones: externa, financiera, impuestos e ingresos, deuda, e infraestructura. Los resultados dejan en evidencia la alta complejidad que implica el análisis y diagnóstico sobre salud fiscal de los gobiernos locales. Las ciudades colombianas no parecen enfrentar, en general, profundos problemas de salud fiscal. Sin embargo, existe evidencia de patrones regionales, en donde las ciudades pertenecientes a las regiones Pacífica y Caribe parecen mostrar fragilidad estructural de largo plazo. Por otro lado, los desafíos de las regiones del interior, Oriental y Central en particular, están más relacionadas con los flujos de caja y la sostenibilidad de corto plazo.
Gerson Javier Pérez-Valbuena
Jaime Bonet-Morón
local public finances, regional economics, Colombia, finanzas públicas locales, economía regional
2018-12
Mobile Money and Money Demand in Kenya
http://d.repec.org/n?u=RePEc:ctn:dpaper:2018-11&r=all
Over the years, several countries have experienced a variety of financial innovations that can have implications for monetary policy. Kenya has been at the forefront of a unique type of financial innovation, mobile money (M-PESA), introduced in 2007. This paper re-estimates the Kenyan money demand including the country specific innovation, mobile money, using the ARDL approach to cointegration over the period 2000 Q1 to 2014 Q2. The results suggest that there is a positive relationship between mobile money and money demand and that the Kenyan demand for money is stable when mobile money is taken into consideration. These results are robust even with the use of alternative measures of mobile money. This finding has important implications for the effectiveness of monetary policy in Kenya and possibly in other countries that have seen developments in mobile money in recent years.
Elizabeth Kasekende
Eftychia Nikolaidou
2018
Incentive effects of SNAP work requirements
http://d.repec.org/n?u=RePEc:ags:umaesp:281156&r=all
During the Great Recession, work requirements for various safety net programs were relaxed, and it has been argued that these contributed to high unemployment rates and long unemployment durations. One work requirement in the SNAP program applies to "able-bodied adults without dependents," and is lifted when participants reach age 50. Using a regression discontinuity approach that removes bias from age rounding, this article finds no evidence the requirement affects the probability of compliant employment when the requirement is in place.
Ritter, Joseph A.
Agricultural and Food Policy, Consumer/Household Economics, Labor and Human Capital
2018-12-17
Short-time work in the Great Recession: Firm-level evidence from 20 EU countries
http://d.repec.org/n?u=RePEc:bcl:bclwop:bclwp124&r=all
Using firm-level data from a large-scale European survey among 20 countries, we analyse the determinants of firms using short-time work (STW). We show that firms are more likely to use STW in case of negative demand shocks. We show that STW schemes are more likely to be used by firms with high degrees of firm-specific human capital, high firing costs, and operating in countries with stringent employment protection legislation and a high degree of downward nominal wage rigidity. STW use is higher in countries with formalised schemes and in countries where these schemes were extended in response to the recent crisis. On the wider economic impact of STW, we show that firms using the schemes are significantly less likely to lay off permanent workers in response to a negative shock, with no impact for temporary workers. Relating our STW take-up measure in the micro data to aggregate data on employment and output trends, we show that sectors with a high STW take-up exhibit significantly less cyclical variation in employment.
Reamonn Lydon
Thomas Y. Mathä
Stephen Millard
Firms, survey, crisis, short-time work, wages, recession.
2018-12
Farsi male da soli: Disciplina esterna, domanda aggregata e il declino economico italiano
http://d.repec.org/n?u=RePEc:csn:wpaper:2018-05&r=all
In questo saggio ripercorriamo la storia dell'economia italiana a partire dagli anni del miracolo economico, mostrando il ruolo della politica economica nelle sue diverse declinazioni (fiscale, monetaria, valutaria) nella determinazione della crescita, e poi del declino. Argomentiamo come i periodi della crescita siano caratterizzati dal tentativo di perseguire il pieno impiego, mentre il successivo periodo del declino è dipeso anche dal tentativo di risolvere i conflitti distributivi interni tramite vincoli esteri sempre più stringenti.
Sergio Cesaratto
Gennaro Zezza
2018-12
Counterfactual Analysis Using Censored Duration Data
http://d.repec.org/n?u=RePEc:cte:werepe:27821&r=all
We propose standardization techniques for the duration distribution in a population with respect to another taken as standard using right censored data, which forms a basis for counterfactual comparisons between distributional features of interest. Alternative standardizations are based on either a proportional hazard semiparametric specification or a nonparametric specification of the underlying conditional distribution. Applications to the restricted mean survival time and the hazard rate are discussed in detail. The proposal is applied to the counterfactual analysis of spells of unemployment duration gender gaps in Spain between 2004-2007. The behavior in small samples is investigated using Monte Carlo experiments.
García Suaza, Andrés Felipe
Delgado González, Miguel Ángel
Gender gaps ;
Spells of unemployment ;
RMST ;
Kaplan-Meier ;
Proportional hazard ;
Standardization ;
Right Censoring
2018-12
Double Deflation: theory and practice
http://d.repec.org/n?u=RePEc:cfm:wpaper:1831&r=all
Real GDP measured from the output side, GDP(O), should equal real GDP measured from the expenditure side, GDP(E), just as corresponding two approaches to measuring GDP in current prices are necessarily equal. But this is only the case even in theory if real value added in each industry is measured by double deflation. We set out the theory of double deflation using a matrix algebra treatment based on the framework of the Supply and Use Tables. The context is the UK’s national accounts which measures volume growth by chained Laspeyres indices and which currently use single not double deflation. Initially we use simplified assumptions about prices. Later we introduce more realistic assumptions. We analyse the conditions on prices under which real GDP(O) equals real GDP(E). We consider three alternative methods of implementing double deflation. The preferred method makes use of all the price indices which the Office for National Statistics currently collects: Producer Price Indices, Services Producer Price Indices, Consumer Price Indices, Export Price Indices and Import Price Indices. We implement a simplified version of double deflation, using the same data as in the latest vintage of the national accounts, and compare our estimates with the official ones. In this version the same price index is used for each product regardless of whether the product is an output or an input. We find that double-deflated industry growth rates are consistently lower than the official single-deflated ones and also considerably more variable year-to-year. We interpret this finding as reinforcing the case for careful selection of the set of deflators to use for double deflation.
Nicholas Oulton
Ana Rincon-Aznar
Lea Samek
Sylaja Srinivasan
Double deflation, Supply and use tables, Value added, National accounts
2018-12
Drivers of Growth in the Philippines
http://d.repec.org/n?u=RePEc:auu:dpaper:702&r=all
During the 2000s PPP GDP per capita growth in the Philippines was modest. Transitional convergence accounted for almost half of the growth in the Philippines during that time period. Reforms to the structure of the economy boosted growth by less than one percentage point per annum. The most significant structural reform was improvements in telecommunication infrastructure that lifted growth by over half a percentage point per annum. The decline of domestic credit to the private sector reduced growth by about one quarter of a percentage point per annum. Successful stabilization policies positively contributed to growth but the effect is small, about one half of a percentage point per annum. The paper discusses the growth performance of the Philippines relative to comparator countries: ASEAN, lower middle income countries, countries where migrant remittances are large relative to GDP, young democracies, structural peers, and regional peers. The main message from the analysis is that structural reforms were not as significant in the Philippines as in comparator countries. The Philippines lagged behind in structural reforms and this significantly contributed to the country's relatively modest growth performance.
Markus Brueckner
Birgit Hansl
2018-04
Fundamental Drivers of Existing Home Sales in Canada
http://d.repec.org/n?u=RePEc:bca:bocadp:18-16&r=all
Existing home sales’ share of Canada’s economic pie has been rising in recent years, and variation around this trend has resulted in outsized contributions to changes in real gross domestic product (GDP). In this context, we use a cointegration framework to estimate the level of resale activity across the Canadian provinces that is supported by fundamentals—namely, full-time employment, housing affordability and migration flows—to help look through the volatility. The results suggest that, over longer horizons, resales activity and these fundamentals share a stable relationship, although deviations are sometimes persistent. We also find a robust and positive relationship between house price growth and deviations of existing home sales from fundamentals. While predicting quarterly changes in resales remains very difficult, provincial models improve upon national and naïve benchmarks and provide a useful framework for identifying risks to GDP growth that stem directly from the resale market.
Taylor Webley
Econometric and statistical methods, Economic models, Housing
2018
Money and Meaning: How working-age social security benefit recipients understand and use their money
http://d.repec.org/n?u=RePEc:cep:sticab:casebrief/35&r=all
Kate Summers
Universal Credit, benefits, working-age, unemployment, stigma, social security
2018-12
Occupational Recognition and Immigrant Labor Market Outcomes
http://d.repec.org/n?u=RePEc:crm:wpaper:1818&r=all
In this paper, we analyze how the formal recognition of immigrants’ foreign occupational qualifications affects their subsequent labor market outcomes. The empirical analysis is based on a novel German data set that links respondents’ survey information to their administrative records, allowing us to observe immigrants at monthly intervals before, during and after their application for occupational recognition. Our findings show substantial employment and wage gains from occupational recognition. After three years, the full recognition of immigrants’ foreign qualifications increases their employment rates by 24.5 percentage points and raises their hourly wages by 19.8 percent relative to immigrants without recognition. We show that the increase in employment is largely driven by a higher propensity to work in regulated occupations. Relating our findings to the economic assimilation of immigrants in Germany, we further document that occupational recognition leads to substantially faster convergence of immigrants’ earnings to those of their native counterparts.
Herbert Brücker
Albrecht Glitz
Adrian Lerche
Agnese Romiti
Occupational Recognition, Immigrants, Labor Markets
2018-12
Estimating the Effective Lower Bound on the Czech National Bank's Policy Rate
http://d.repec.org/n?u=RePEc:cnb:wpaper:2018/9&r=all
This paper focuses on the estimation of the effective lower bound on the Czech National Bank's policy rate. The effective lower bound is determined by the value below which holding and using cash would be preferable to holding deposits with negative yields. This bound is approximated on the basis of the storage, insurance and transport costs of cash and the loss of convenience associated with cashless payments. This estimate is complemented by a calculation based on interest charges reflecting the impact of negative rates on banks' profitability. Overall, we get a mean of slightly below -1%, approximately in the interval (-2.0%, -0.4%). In addition, by means of a vector autoregression we show that the potential of negative rates is not sufficient to deliver monetary policy easing similar in its effects to the impact of the Czech National Bank's exchange rate commitment during the years 2013-2017.
Dominika Kolcunova
Tomas Havranek
Costs of cash, effective lower bound, negative interest rates, transmission of monetary policy, zero lower bound
2018-09
CBO’s Model for Forecasting Business Investment: Working Paper 2018-09
http://d.repec.org/n?u=RePEc:cbo:wpaper:54871&r=all
CBO models most business investment by using a modified neoclassical specification. That specification is similar to the neoclassical model in that the desired capital stock depends positively on output and negatively on the cost of capital, which includes the price of capital, taxes, and rates of return. The specification differs from the neoclassical model in that the capital stock adjusts more rapidly to changes in output than to changes in the cost of capital. In contrast, CBO models investment in capital used by agriculture and extractive industries as depending
Mark Lasky
2018-12-12
Gains from Wage Flexibility and the Zero Lower Bound
http://d.repec.org/n?u=RePEc:bge:wpaper:1066&r=all
We analyze the welfare impact of greater wage flexibility while taking into account explicitly the existence of the zero lower bound (ZLB) constraint on the nominal interest rate. We show that the ZLB constraint generally amplifies the adverse effects of greater wage flexibility on welfare when the central bank follows a conventional Taylor rule. When demand shocks are the driving force, the presence of the ZLB implies that an increase in wage flexibility reduces welfare even under the optimal monetary policy with commitment.
Roberto M. Billi
Jordi Galí
labor market flexibility, Nominal rigidities, optimal monetary policy with commitment, Taylor rule, ZLB
2018-12
Offrir des biens publics et des communs et revitaliser l’action publique dans le cadre d’un processus de « destruction créatrice »
http://d.repec.org/n?u=RePEc:crc:wpaper:1808&r=all
Recent developments in the economic analysis about public goods and commons, initiated notably in relation to the United Nations Development Program (UNDP) and to the work of Elinor Ostrom, have highlighted the social utility of their production to meet societal expectations of democracy and of sustainable development. The production of public and social economy organisations is in this perspective of crucial importance for the future, as is the outline of public policies that help develop coproduction or joint production of public goods and services. Thus, Public and Social and Solidarity Economy Partnerships (PSSEP) are the subject of analyzes in the CIRIEC book Providing public goods and commons. Towards coproduction and new forms of governance for a revival of public action that highlights: the importance of these partnerships within the framework of the current paradigm of public action; the induced behavioral transformations of the organizations; the scope that these new forms of partnership can have in terms of co-construction of public action and of responses to expectations on the territories; and the place of these partnerships in a process called here "creative destruction of public action".
Philippe BANCE
public goods, commons, coproduction, joint production, public action, paradigm, destructive creation, social economy organisations, public organisations
2018-08
Informalidad laboral en el sector rural colombiano
http://d.repec.org/n?u=RePEc:col:000176:016356&r=all
El presente documento tiene por objetivo realizar un análisis sobre la informalidad laboral en el sector rural colombiano y encontrar la mejor definición para lograr una acertada medición. Con el fin de tener niveles de comparación con la informalidad rural, se investiga la informalidad en otras regiones del mundo, así como la total nacional. Los resultados muestran que, aunque los niveles de informalidad total y rural han bajado principalmente por la reforma tributaria de 2012, el 85% de la población ocupada rural es informal, un nivel muy alto comparado con el de regiones de ingresos bajos como África central o Asia meridional. La investigación presenta las causas estructurales e institucionales que han generado estos niveles tan bajos.
Jhonatan Quemba
informalidad, informalidad rural, empleo informal, sector rural
2018-06-20
Killing social leaders for territorial control: the unintended consequences of peace
http://d.repec.org/n?u=RePEc:col:000518:017020&r=all
Incomplete peace agreements may inadvertently increase insecurity if they trigger violent territorial contestation. We study the unintended consequences of the Colombian peace process and find that the permanent ceasefire declared by the FARC insurgency during peace negotiations with the government triggered a surge in the targeting of local community leaders. Leaders were killed by armed groups excluded from the peace process to thwart collective action and civilian mobilization, thus consolidating their dominance in formerly FARC-controlled areas. These results are exacerbated in places with judicial inefficiency and where peasants dispossessed during the conflict have started administrative process to reclaim their land.
Mounu Prem
Andrés Rivera
Darío Romero
Juan F. Vargas
Social leaders, Peace process, Armed conflict, Territorial control
2018-12-13
Measuring the Health Cost of Prolonged Unemployment: Evidence from the Great Recession
http://d.repec.org/n?u=RePEc:ags:umaesp:280435&r=all
How much does a year of unemployment affect a person’s health? Previous studies estimate the health effects of job loss after a follow-up period, but the length of unemployment spells within the follow-up is an implicitly variable treatment. Thus estimates based on a fixed follow up average over unemployment spells of different lengths, which implicitly depend on macroeconomic conditions. We estimate the effects of time unemployed and find robust negative effects of duration on men’s self-assessed health. For women the estimated effects are smaller and less precise. We use an instrumental variables approach to account for dynamic selection driven by feedback from health to duration via search intensity or reservation wages. Combining these effects with prior estimates of the relationship between self-assessed health and specific-cause mortality suggests the effects correspond to large social costs.
Beatty, Timothy K.M.
Ritter, Joseph A.
Health Economics and Policy, Labor and Human Capital
2018-07
Securitization and crash risk : Evidence from large European banks
http://d.repec.org/n?u=RePEc:bof:bofrdp:2018_026&r=all
The 2008 global financial crisis highlights the importance of securitization and crash risk. Yet there is a dearth of papers exploring the link between securitization and crash risk. We analyze 7,096 securitization deals made by large European listed banks between 2000 and 2017. Our paper provides evidence that bank risk declines in the year of the securitization and increases in the following year. We also show that this effect is driven by low-risk securitization deals. We use a dynamic panel data approach to establish a causal relationship and control the robustness of our results by using different tail risk measures (such as crash risk, value at risk, and expected shortfall). We also show that the risk reduction effect is weaker in crisis periods relative to normal times. Our findings have policy implications as regulators attempt to revive European securitization markets.
Battaglia, Francesca
Buchanan, Bonnie G.
Fiordelisi, Franco
Ricci, Ornella
2018-12-11
Money and Capital in a Persistent Liquidity Trap
http://d.repec.org/n?u=RePEc:bfr:banfra:703&r=all
In this paper we analyze the implications of a persistent liquidity trap in a monetary model with asset scarcity. We show that a liquidity trap may lead to an increase in real cash holdings and be associated with a decline in output in the medium term. This medium-term impact is a supply-side effect that may arise when agents are heterogeneous. It occurs in particular with a persistent deleveraging shock, leading investors to hold cash yielding a low return. Policy implications differ from shorter-run analyses implied by nominal rigidities. Quantitative easing leads to a deeper liquidity trap. Exiting the trap by increasing expected inflation or applying negative interest rates does not solve the asset scarcity problem.
Philippe Bacchetta
Yannick Kalantzis
Zero lower bound, liquidity trap, asset scarcity, deleveraging.
2018
Impact of the fiscal manoeuvre on GDP growth: estimation of short-term effects using fiscal multipliers
http://d.repec.org/n?u=RePEc:bkr:wpaper:note17&r=all
The Note analyses fiscal multipliers in the Russian economy and estimates the im-pact of the fiscal manoeuvre, the start of which is planned for 2019, on GDP growth. Fiscal multipliers in the Russian economy proved to be rather low, in part due to “leakages” through imports and relatively low efficiency of budgetary funds. We estimate the multipli-er of total revenue of Russia’s budget at -0.75 and the multiplier of total spending at +0.28. Therefore, changes in the budget revenue produce a stronger effect on GDP growth com-pared with the effect from the comparable change in expenditures. However, compared to changes in expenditures, changes in revenue feed through to GDP growth more slowly. Our analysis of the components of total expenditure based on the Russian and inter-national experience suggests that in terms of the functional classification of expenditure, the biggest is the fiscal multiplier for economic spending, followed by military and social blocks. Spending on general state issues have a negative multiplier. The analysis of the economic classification of expenditure showed that the investment component has the highest multiplier. It exceeds more than twofold multipliers for other components. The estimation of the effects of the fiscal manoeuvre using fiscal multipliers gives grounds for expecting in the medium term additional 0.2-0.3 pp to GDP growth per year on average as a result of the manoeuvre. However, the actual effect may prove materially higher than the estimated one in case of efficient fund utilisation (e.g., a thorough selec-tion of investment projects) as well as rapid cost cutting coupled with labour productivity growth by VAT payers. This will raise the fiscal multiplier for spending and lower it for rev-enue. Additionally, fiscal multipliers demonstrate a short-term effect of the fiscal policy on GDP growth without assessing its impact on the potential growth, which should also be positive. The current situation in the economy bordering on the full utilisation of resources may serve as a constraining factor, thereby lowering the efficiency of their utilisation.
Sergey Vlasov
2018-12
Bayesian Forecasting of Electoral Outcomes with new Parties' Competition
http://d.repec.org/n?u=RePEc:bge:wpaper:1065&r=all
We propose a new methodology for predicting electoral results that combines a fundamental model and national polls within an evidence synthesis framework. Although novel, the methodology builds upon basic statistical structures, largely modern analysis of variance type models, and it is carried out in open-source software. The methodology is largely motivated by the specific challenges of forecasting elections with the participation of new political parties, which is becoming increasingly common in the post-2008 European panorama. Our methodology is also particularly useful for the allocation of parliamentary seats, since the vast majority of available opinion polls predict at the national level whereas seats are allocated at local level. We illustrate the advantages of our approach relative to recent competing approaches using the 2015 Spanish Congressional Election. In general, the predictions of our model outperform the alternative specifications, including hybrid models that combine fundamental and polls' models. Our forecasts are, in relative terms, particularly accurate to predict the seats obtained by each political party.
José García-Montalvo
Omiros Papaspiliopoulos
Timothée Stumpf-Fétizon
multilevel model, Bayesian machine learning, inverse regression, evidence synthesis, elections
2018-12
Big Data, Computational Science, Economics, Finance, Marketing, Management, and Psychology: Connections
http://d.repec.org/n?u=RePEc:ems:eureir:112499&r=all
The paper provides a review of the literature that connects Big Data, Computational Science, Economics, Finance, Marketing, Management, and Psychology, and discusses some research that is related to the seven disciplines. Academics could develop theoretical models and subsequent econometric and statistical models to estimate the parameters in the associated models, as well as conduct simulation to examine whether the estimators in their theories on estimation and hypothesis testing have good size and high power. Thereafter, academics and practitioners could apply theory to analyse some interesting issues in the seven disciplines and cognate areas.
Chang, C-L.
McAleer, M.J.
Wong, W.-K.
Big Data, Computational science, Economics, Finance, Management, Theoretical models, Econometric and statistical models, Applications.
2018-01-01
The Initial Effects of EMV Migration on Chargebacks in the United States
http://d.repec.org/n?u=RePEc:fip:fedkrw:rwp18-10&r=all
To reduce counterfeit fraud in the card-present environment, the United States started migrating to EMV chip technology in the mid-2010s. Since October 2015, merchants have been liable for counterfeit fraud committed using EMV cards if the merchants had not adopted EMV chip-readable terminals. In particular, merchants are held liable through chargebacks. This study examines the initial effects of the EMV liability shift on fraud chargeback and merchant loss rates using data from merchant processors and PIN debit networks. Combined with gross fraud rates—overall fraud rates regardless of who incurs fraud losses—estimated in other studies, the results of our study suggest that merchants have faced a significantly higher share of fraud losses since the shift; however, this spike will decline if merchants continue to adopt EMV. Merchant fraud loss rates for signature-based transactions in the card-present channel increased sixfold, but the rates significantly vary between magnetic stripe and chip-to-chip transactions. While merchant fraud loss rates for magnetic stripe transactions are over 9 basis points in value for all merchants combined and vary across merchant categories, the rates for chip-to-chip transactions are very low, around 0.02 basis points, across all merchant categories. Because the gross fraud rates for magnetic-stripe transactions did not increase after the liability shift, our results suggest that the higher merchant fraud loss rates for magnetic-stripe transactions are mainly due to the liability shift. Compared with signature-based transactions, fraud chargeback rates for PIN debit transactions in the card-present channel are much lower. Our results suggest that both EMV and PIN are effective in reducing merchant fraud loss rates. However, we need detailed gross fraud rates to examine how effective EMV and PIN are in reducing fraud more generally in the card-present channel. Our results for card-not-present fraud chargeback and merchant loss rates are mixed. Both rates increased for some merchant categories, but the rates for all merchants combined actually decreased in our data. This decline is likely due to the underrepresentation of signature-based CNP transactions in our data. The gross fraud rates for card-not-present transactions increased over the same period, and merchants are generally liable for card-not-present fraud.
Hayashi, Fumiko
Markiewicz, Zach
Minhas, Sabrina
Chargebacks; Fraud; EMV Liability Shift; Authentication methods
2018-12-03
Cost and Value in Banks: A model fit for the digital era?
http://d.repec.org/n?u=RePEc:eps:ecriwp:13577&r=all
Retail and corporate banks have to cope with legacy issues that impede their efficiency and reactivity. In particular, different norms within groups are still used for accountancy, cost allocation systems and product hierarchies. Also, the share of IT spending used to maintain existing IT systems remains high. Yet, many of the banks’ activities are being rapidly digitalised, especially in consumer finance. The potential of data analytics is being gradually unleashed at different stages of the products. In that context, regulators should favour the digitalisation of banks while alleviating related risks. They should also build on this mutation to raise consumers’ welfare and the competitiveness of non-financial corporations (NFCs). Among these measures, the treatment of certain software expenses in the new Capital Requirements Regulation could be reassessed. Also, authorities should better foresee the cost of IT changes needed for implementing new rules and the indirect impact of those rules on banks’ clients, especially SMEs. Further convergence in know-your-customer processes for NFCs is needed. The preventive approach in credit should be generalised to all clients. Finally, labour and education policies are key to ensuring a sufficient supply of IT skills.
Bouyon, Sylvain
2018-04
The marginal propensity to hire
http://d.repec.org/n?u=RePEc:fip:fednsr:875&r=all
This paper studies the link between firm-level financial constraints and employment decisions, as well as the implications for the propagation of aggregate shocks. I exploit the idea that, when the financial constraint binds, a firm adjusts its employment in response to cash flow shocks. I identify such shocks from changes to business rates, a U.K. tax based on a periodically estimated value of the property occupied by the firm. A 2010 revaluation implied that similar firms, occupying similar properties in narrowly defined geographical locations, experienced different tax changes, allowing me to control for confounding shocks to local demand. I find that, on average, for every £1 of additional cash flow, 39 pence are spent on employment. I label this response the marginal propensity to hire (MPH). I then calibrate a firm dynamics model with financial frictions toward this empirical evidence. As in the data, small and leveraged firms in the model have a greater MPH. Simulating a tightening of credit conditions, I find that the model can account for much of the decline in U.K. aggregate output and employment observed in the wake of the financial crisis.
Melcangi, Davide
financial frictions; employment; heterogeneous firms
2018-12-01
Industry Comparison Using the Data from the "Questionnaire Survey Regarding Data Utilization" (Japanese)
http://d.repec.org/n?u=RePEc:eti:rdpsjp:18032&r=all
It is important for Japanese industry to increase productivity and to provide high value-added products and services through data utilization. Under such circumstances, new data technologies such as IoT, big data, and artificial intelligence are expected as keys to greatly improve industrial productivity. In this study, we conducted an exploratory analysis using a survey in the form of a questionnaire based on the research question "Is there a difference between industries regarding data utilization?" As a result of comparing the values (average values) of features for each industry included in the survey, it was found that many industries were similar and there were no industries that exhibited superiority regarding the outcomes of data utilization. In addition, cluster analysis was performed on the response coefficients calculated when data and behavioral attributes were input and the outcome item was output. As a result, it was found that there was an industry group with negative response coefficients and another industry group with positive response coefficients with respect to advanced data resources and technologies. From these findings, it was suggested that there was a gap between "expected outcome of investment in data resources and technologies" and "the actual outcomes of data utilization".
TATSUMOTO Hirofumi
HIRAI Yuri
WATANABE Toshiya
2018-12
Overview of the Changes to the FRB/US Model (2018)
http://d.repec.org/n?u=RePEc:fip:fedgfn:2018-12-07&r=all
This FEDS Note summarizes a more comprehensive set of modifications introduced with the November 2018 public release of the FRB/US model and provides some motivation for why they were made.
Jean-Philippe Laforte
2018-12-07
Understanding AI Driven Innovation by Linked Database of Scientific Articles and Patents
http://d.repec.org/n?u=RePEc:eti:polidp:18017&r=all
The linked dataset of AI research articles and patents reveals that substantial contributions by the public sector are found in AI development. In addition, the role of researchers who are involved both in publication and patent activities, particularly in the private sector, increased over time. That is, open science that is publicly available in research articles, and propriety technology that is protected by patents, are intertwined in AI development. In addition, the impact of AI, combined with big data and IoT, which are defined as "new" IT innovations, is discussed by comparing it with traditional IT, which only consists of the technological progress of computer hardware and software developments. Both new and traditional IT can be understood by using the framework of GPT (general purpose technology), while the organization of new IT innovation can be characterized as an emergence of multiple ecosystems, instead of being organized in the pattern of platform leadership, found in traditional IT.
MOTOHASHI Kazuyuki
2018-11
Diversidad de Género en los Consejos: el caso de España tras la Ley de Igualdad
http://d.repec.org/n?u=RePEc:fda:fdaeee:eee2018-29&r=all
El objetivo de este artículo es analizar la diversidad de género en los Consejos de Administración de todas las empresas cotizadas en el periodo 2013-2017. España optó en 2007 por una ley de cuotas “blanda” - soft-law quota -, es decir, se trata de una mera recomendación sin sanciones en caso de incumplimiento. En 2017 hubo 1.363 consejeros en empresas cotizadas, y de ellos tan solo 247 eran mujeres, un 18 %. En la primera parte del trabajo vemos la escasa mejoría en cuanto al incremento del porcentaje de mujeres en el marco de un análisis sectorial y por tipo de consejero (ejecutivos, dominicales, independientes y otro externo). Entre sectores no encontramos diferencias, pero sí es destacable el retroceso en cuanto al porcentaje de consejeras ejecutivas. Vemos cómo la situación es mucho peor en las empresas que no cotizan en el IBEX que aquellas que sí lo hacen. En la segunda parte del trabajo, aprovechando que desde 2013 las empresas cotizadas en su informe anual deben contestar a una serie de preguntas sobre la diversidad de género en sus consejos, hemos hecho un análisis usando técnicas de tratamiento de textos. Encontramos que en las respuestas existe un alto porcentaje de “auto-plagio” - i.e. copian sus respuestas de informes de años anteriores - y de “plagio” - i.e. copian respuestas de otras empresas publicadas el año anterior. Todo ello parece indicar el escaso interés, principalmente de las empresas que no cotizan en el IBEX, por la diversidad de género en sus Consejos. Por otro lado, el insuficiente avance, no solo con respecto al objetivo de la Ley de Igualdad de 2007 de alcanzar una representación femenina del 40 %, sino también con respecto a la recomendación del Código Unificado de Buen Gobierno de la CNMV que estableció el compromiso de alcanzar el 30 % de consejeras en 2020, nos lleva a plantear la necesidad de cambiar la ley sobre la política de consejeras en España. Siguiendo la experiencia internacional y con el objetivo de acelerar la transición hacia un nuevo equilibrio de igualdad de oportunidades, en nuestra opinión, sería necesaria la introducción de forma gradual, respetando el calendario de renovación de los Consejos, de una política de cuotas obligatorias y de carácter temporal. Una vez alcanzado este nuevo equilibrio, esta política de cuotas, que ya se ha implementado en países de nuestro entorno como Noruega, Islandia, Italia, Alemania, Francia y Bélgica, carecería de sentido. Según nuestros cálculos, si queremos alcanzar una representación del 30 % de mujeres en los Consejos, será necesario reemplazar a 235 hombres (en el escenario “débil” serían 126) y si queremos una representación del 40 % el reemplazo debería ser de 352 hombres (o 253 en el escenario “débil”).
J. Ignacio Conde-Ruiz
Manu García
Manuel Yáñez
2018-12
Growth and Welfare Gains from Financial Integration Under Model Uncertainty
http://d.repec.org/n?u=RePEc:fip:fedkrw:rwp18-12&r=all
We build a robustness (RB) version of the Obstfeld (1994) model to study the effects of financial integration on growth and welfare. Our model can account for the empirically observed heterogeneity in the relationship between growth and volatility for different countries. The calibrated model shows that financial integration leads to significantly larger gains in growth and welfare for advanced countries than developing countries, with some developing countries experiencing growth and welfare loss in financial integration. Our analytical solutions help uncover the key mechanisms by which this happens.
Luo, Yulei
Nie, Jun
Young, Eric R.
Robustness; Model Uncertainty; Financial Integration; Risk Sharing; Economic Growth; Welfare
2018-12-07
We Are What We Eat: Obesity, Income, and Social Comparisons
http://d.repec.org/n?u=RePEc:grz:wpaper:2018-21&r=all
The empirical evidence of a non-monotone relation between income and obesity is not well explained. We build a theoretical model combining income inequality and social comparisons to explain the link between income and obesity and study tax policy implications for fighting obesity. We assume that differences in food consumption patterns between poor and wealthy households partly reflect positionality, which is the concern for social status. Our key assumption is that positionality for low-calorie food consumption is positively related to a country’s wealth. In this framework, body weight outcomes reflect competing income and positionality effects, yielding the following results. We explain the link between average obesity rates, and standards of living and suggest the existence of a Kuznets curve for obesity. For cross sections of the population, we explain the observed correlation between income and obesity, which is positive in poor countries, and negative rich countries. We find that increasing the relative cost of high-calorie food is less effective at decreasing the relative weight of poor individuals in rich countries than in poor countries.
Nathalie Mathieu-Bolh
Ronald Wendner
Obesity; Status; Consumption Reference Points; Kuznets Curve; Tax Policy
2018-12
Evidence-based Policymaking in the United States
http://d.repec.org/n?u=RePEc:eti:rpdpjp:18016&r=all
In the aim of drawing lessons for Japanese policymakers and practitioners, this paper deeply analyzes the Evidence-based Policymaking (EBPM) of the US, which is the front-runner in this field. In the US, Commission on Evidence-based Policymaking (CEP), established by a bipartisan call, released its final report in September 2017. It made the following recommendations: 1. Improving secure, private, and confidential data access; 2. Improving privacy protection and transparency on data usage; 3. Modernizing data infrastructure; and 4. Strengthening federal evidence-building capacity. In this paper, we review the brief history of the US EBPM and the background of the establishment of the CEP. Concerning the federal capacity building, we focus on the case of the Department of Labor (DOL) which became the hallmark of EBPM with the leadership of Chief Evaluation Office. Since the details of evidence building and utilization vary depending on policy areas, scales, etc., we also explore cases of the Department of Health and Human Services, the Department of Education in addition to DOL with brief introduction of their advanced approaches using tiered grant, pay for success, and behavioral economics. Through the CEP final report and cases above, we explore implications on the promotion of Japanese EBPM, in particular in the central and local governments.
TSUDA Hirokazu
OZAKI Kohei
2018-11
Sustaining Growth through Innovation in Capital Markets
http://d.repec.org/n?u=RePEc:eps:ecmiwp:13971&r=all
Well-functioning, deeper and highly integrated European capital markets are expected to play a greater role in providing alternative corporate funding, better savings/investment opportunities and enhancing private risk-sharing mechanisms. At the Annual Conference organised in Brussels on 10 October 2018, policy makers, industry representatives and academics contributed to the public debate about the capacity of capital markets to enable long-term value creation in the real economy, namely supporting innovative companies and sustainable economic growth. As the end of the five years of the Juncker mandate approaches, European capital markets are at a very important intersection. The Capital Markets Union (CMU) project should aim beyond the actions set for end-2019, towards a revamped strategy for EU-27. However, before setting priorities for the future, it was necessary to take a critical look backwards on what has been promised and what has been achieved. Despite the huge demand for capital, innovative companies and small enterprises are tending to prefer staying private longer or not going public at all. Although the Commission is committed to unlocking the full potential of sustainable finance, current ESG investment represents a very niche part of the total fund market. Last but not least, capital markets across Europe, and particular in the CEE region, remain significantly less developed, both in terms of size and liquidity. For ECMI, pursuing a path traced 25 years ago, this means an even more active and vital role in steering the discussion and engaging in strategic thinking about Europe’s capital markets.
Amariei, Cosmina
Thomadakis, Apostolos
2018-10
Statutory Modification of the Collateral Source Rule
http://d.repec.org/n?u=RePEc:hcx:wpaper:1710&r=all
Statutory law governing application of the collateral source rule is surveyed for the fifty states, District of Columbia, Puerto Rico, and the US Virgin Islands. The statutes are described using a classification scheme involving eight major substantive categories that have elements varying in number up to as many as seven distinct items. The classifications are presented in a comprehensive table that notes the number of jurisdictions in which each elemental modification appears. A second table presents the amassed information in a jurisdiction-by-jurisdiction fashion.
David Schap
Kayla Horan
Andrew Feeley
Forensic economics
2017-12
What are the consequences of global banking for the international transmission of shocks?: a quantitative analysis
http://d.repec.org/n?u=RePEc:fip:fedbwp:18-11&r=all
The global financial crisis of 2008 was followed by a wave of regulatory reforms that affected large banks, especially those with a global presence. These reforms were reactive to the crisis. In this paper we propose a structural model of global banking that can be used proactively to perform counterfactual analysis on the effects of alternative regulatory policies. The structure of the model mimics the US regulatory framework and highlights the organizational choices that banks face when entering a foreign market: branching versus subsidiarization. When calibrated to match moments from a sample of European banks, the model is able to replicate the response of the US banking sector to the European sovereign debt crisis. Our counterfactual analysis suggests that pervasive subsidiarization, higher capital requirements, or ad hoc policy interventions would have mitigated the effects of the crisis on US lending.
Fillat, Jose
Garetto, Stefania
Smith, Arthur V.
global banks; banking regulation; shock transmission
2018-10-01
Fostering Institutional Investment in Europe’s Capital Markets: Reality vs. Expectations
http://d.repec.org/n?u=RePEc:eps:ecmiwp:13584&r=all
The capacity of insurance companies and pension funds to fulfil their financial obligations to policy holders and beneficiaries continues to be under scrutiny, with additional challenges posed by the prolonged low yield environment and the path towards normalisation of monetary policy in the near future. Starting from their specific business model, investment decisions are driven by multiple factors, such as assets and liabilities management, product design and mix, financial and economic conditions, risk-return performance, cost optimisation, prudential requirements, accounting rules, tax regimes and technological developments. Notwithstanding the heterogeneity across companies and/or member states, the portfolios of insurance companies and pension funds remain heavily invested in fixed income, with increasing exposures to higher yielding instruments in recent years. The overall low level of equity must be addressed decisively. Given the specificity of their balance sheets, institutional investors are considered best suited to engage in long-term investment. With the growing importance of sustainability factors, significant changes in their asset allocation and risk-management practices are envisaged.
Amariei, Cosmina
2018-04
Estimating Family Preferences for Elder-care Services: A conjoint-survey experiment in Japan
http://d.repec.org/n?u=RePEc:eti:dpaper:18082&r=all
The paper provides a preference evaluation for elderly-care services, based on a conjoint survey and a rational-choice framework. For the empirical section, we conducted a conjoint survey with Japanese respondents to estimate preferences of elderly-care services. Our findings show that room sharing is the most important for both demand and consumer surplus, and it is justified to assist households in using elderly-care facilities at a middle distance with additional health-care services.
KANEKO Shinji
KAWATA Keisuke
YIN Ting
2018-12
Short-run and long-run food import elasticities with persistent trading habits
http://d.repec.org/n?u=RePEc:fer:wpaper:111&r=all
This paper provides estimates and explores the role of own price import demand (Armington) elasticities between different source countries for five agricultural commodities in a framework that incorporates temporal dimension formulated as trading habit persistence. The estimations employ FAO’s bilateral food commodity trade database, complemented with importer and exporter country characteristics from other data. The results support the hypothesis that trade patterns are persistent the adjustment following price changes takes effect with delays. Apart from the evidence for the presence of habit persistence and hence different short and long-term elasticities in general, significant differences between countries are also evidenced, in particular between high- and low-income countries and between main geographic areas. Consistently with the barriers for market entry considerations we also observe higher persistence downwards than upwards.
Niemi, Janne
Armington elasticity, Trade, Habit persistence, Agricultural commodities, Business regulation and international economics, E71, F14, O19, Q17,
2018
Aggregate statistics on trafficker-destination relations in the Atlantic slave trade
http://d.repec.org/n?u=RePEc:ems:eureir:112486&r=all
The available aggregated data on the Atlantic slave trade in between 1519 and 1875 concern the numbers of slaves transported by a country and the numbers of slaves who arrived at various destinations (where one of the destinations is “deceased”). It is however unknown how many slaves, at an aggregate level, were transported to where and by whom, that is, we know the row and column totals, but we do not known the numbers in the cells of the matrix. In this paper we use a simple mathematical technique to fill in the void. It allows us to estimate the trends in the deceases per transporting country, and also to estimate the fraction of slaves who went to own colonies or to others. For example, we estimate that of all the slaves who were transported by the Dutch only about 7 percent went to Dutch colonies, whereas for the Portuguese this number is about 37 percent.
Franses, Ph.H.B.F.
van den Heuvel, W.
2018-01-01
The PEPP could become the new UCITS
http://d.repec.org/n?u=RePEc:eps:ecmiwp:13893&r=all
The EU is well on its way to agreeing on a new European financial product rule, the Pan-European Pension Product (PEPP). Proposed a year ago, both the Parliament and the Council have finalised their readings, ready to have it adopted before this Parliament steps down. The PEPP is intended to make large-scale portable and cost-efficient savings products available throughout the EU. Over time, this first buy-side financial initiative from the EU under the capital markets union programme could become a significant investment vehicle in support of the EU economy, even overtaking the current UCITS, first adopted in 1985.
Lannoo, Karel
2018-09
Credibility, Flexibility and Renewal: The Evolution of Inflation Targeting in Canada
http://d.repec.org/n?u=RePEc:bca:bocadp:18-18&r=all
In 1991, Canada became the second country to adopt an inflation target as a central pillar of its monetary policy framework. The regime has proven much more successful than initially expected, both in achieving price stability and in stabilizing the real economy against a wide range of shocks. We identify and discuss three factors that have contributed to this performance: i.the simple, readily understood and consistently applied specification of the inflation target, which, since adoption, has taken the form of a point target inside a symmetric control range; ii.the establishment of the target in an agreement between the central bank and government, in which inflation control was recognized as a joint duty of both parties, implying key supporting roles for fiscal and macroprudential policy; and iii.the agreement’s regular and thorough review-and-renewal process, which has led to continual improvement based on accumulated experience and advances in the academic literature. Together, these factors have helped anchor inflation expectations around a credible target. This anchoring has in turn made it easier for monetary policy to stay on target, setting a powerful virtuous cycle into motion. An additional benefit is that well-anchored inflation expectations leave monetary policy with greater flexibility to consider its impacts on output and employment variability, as well as financial stability. Nonetheless, certain features of the current economic landscape—including low equilibrium real interest rates and high debt burdens in key sectors—now present monetary policy in Canada and other jurisdictions with significant challenges. We discuss these issues and argue that they require inflation-targeting central banks to give careful thought to the steps that can be taken to refine and strengthen their policy frameworks, widen their toolkits and best ensure complementarity with other macrofinancial policies.
Thomas J. Carter
Rhys R. Mendes
Lawrence Schembri
Credibility, Inflation targets, Monetary Policy, Monetary policy framework
2018
Farm Labor Markets in the United States and Mexico Pose Challenges for U.S. Agriculture
http://d.repec.org/n?u=RePEc:ags:uersib:281161&r=all
The U.S. farm labor market shows many signs of tightening, including producer reports of labor shortages, increases in farm wages, more employment of guest workers through the H-2A Temporary Agricultural Program, and a shrinking supply of farm labor from rural Mexico—the source of most foreign-born farm workers in the United States. Mexico’s farm labor market has also faced labor constraints over the past several decades. Although Mexican agricultural output continues to grow, rural Mexicans are less likely to work as farm workers either in Mexico or in the United States, as the Mexican economy transitions toward more focus on the service sector. This report reviews evidence showing that rising educational levels and increased nonfarm employment in Mexico are among the leading drivers of farm labor supply changes in that country. Several options by which U.S. agricultural employers could respond to a tighter labor market are explored, including raising wages, further mechanization, greater employment of guest workers, and switching to less labor-intensive crops.
Zahniser, Steven
Taylor, J. Edward
Hertz, Thomas
Charlton, Diane
Agricultural and Food Policy
The ups and downs of the gig economy, 2015–2017
http://d.repec.org/n?u=RePEc:fip:fedbwp:18-12&r=all
A variety of researchers and public entities have estimated the prevalence of nontraditional work arrangements — using diverse definitions — in recent decades, and the topic has received increasing attention in the past five years. Despite numerous media reports that the prevalence of nonstandard work has increased since the Great Recession, not all sources agree on this point, and very little evidence exists relating to hours or earnings from such arrangements and their changes over time. Using unique data from the Survey of Informal Work Participation (SIWP), we describe changes in informal work activity across 2015, 2016, and 2017 along multiple dimensions and for a variety of specific jobs. Considering the net changes observed between 2015 and 2017, we find that participation rates and earnings were mostly flat across the period, while average hours for gig workers declined by economically and statistically significant margins. The aggregate number of full-time equivalent jobs embodied in informal work — a measure combining participation rates and hours — also declined by an economically significant margin between 2015 and 2017. A major exception to these trends is that average ridesharing hours more than quadrupled between 2015 and 2017. We find some evidence that the recent declines in informal work hours represented a response to declining unemployment rates, but during this time period there also appears to have been upward structural pressure on gig work that provided a particular boost to platform-based work.
Bracha, Anat
Burke, Mary A.
gig economy; informal work; survey; business cycle fluctuations
2018-10-01
Assessing the Productivity Consequences of Agri-Environmental Practices When Adoption Is Endogenous
http://d.repec.org/n?u=RePEc:fer:wpaper:112&r=all
We address the general problem of selection bias, endemic to analyzing the effects of any policy where adoption is voluntary, with empirical application to environmental policies for agriculture. Many voluntary practices for mitigating the environmental impacts of agriculture provide external benefits while lowering productivity. Policy analysis of the productivity consequences is complicated by the fact that decision-makers can choose their own policy levers, an action that ruins any notion of random assignment. We introduce an identification strategy to correct this kind of endogeneity, combining classic methods from stochastic frontier analysis and selection models. Applying it to micro-level data from Finnish grain farms, we find that more efficient producers are more likely to enroll in subsidized practices. And, because these practices tend to reduce yield, frontier analysis without the endogeneity correction greatly understates productivity losses. In other words, naively basing the frontier estimator on the subset of less productive farms leads to downward bias in the resulting frontier estimates. In fact, average inefficiency more than doubles after the correction in this case. An outlier investigation also suggests that the lowest decile of farms are responsible for most of the selection bias in the uncorrected model.
Bostian, AJ A.
Bostian, Moriah B.
Laukkanen, Marita
Simola, Antti
productivity, stochastic frontier analysis, endogeneity, selection model, agri-environmental policy, Environment, energy and climate policy, Q53, Q58, Q18, Q12, D24, C54, C34, C36,
2018
Property Rights and Intellectual Property Protection, GDP growth and Individual Well-Being in Latin America
http://d.repec.org/n?u=RePEc:fln:wpaper:029&r=all
Amina A. Lahsen
Alan Piper
2018
Skill Transference and International Migration: A theoretical analysis on skilled migration to the Anglosphere
http://d.repec.org/n?u=RePEc:eti:dpaper:18083&r=all
In this paper, we analyze how skill transference from an origin to destination country, captured by lower productivity at the destination caused by differences in language use, affects international migration by skilled workers, using a multi-country NEG model proposed by Gasper et al. (2017). Specifically, our interest is to explain how less frictional countries in terms of linguistic communication such as those in the Anglosphere (English-speaking countries) attract more highly-skilled international migrants. The analysis based on asymmetric skill transference among countries, in which the world is divided into two groups, Anglosphere (English-speaking countries) and non-Anglosphere (non-English-speaking countries), finds that countries in the Anglosphere are more likely to be the industrial core attracting all skilled (and imperfectly mobile) workers than countries in the non-Anglosphere. Also, we find that less frictional migration from the non-Anglosphere to the Anglosphere always accelerates industrial agglomeration in the Anglosphere core country, while both less frictional migration within the Anglosphere and expanding the Anglosphere (an increase in the number of countries constituting the Anglosphere) do not always accelerate industrial agglomeration in the Anglosphere due to the market crowding effect.
NAKAGAWA Mariko
2018-12
Voluntary Provision of Public Goods and Cryptocurrency
http://d.repec.org/n?u=RePEc:eti:dpaper:18081&r=all
The purpose of this paper is to show how the mechanism of the reward structure for cryptocurrency mining (known as “Proof of Work†) is applicable to alleviation of the free rider problem for voluntary public goods provision. This paper presents the following results. First, if each individual reports preferences honestly, then the Samuelson condition can hold. It is possible to set an appropriate level of mining. Second, if the scheme (mechanism) offered by our manuscript is introduced, public goods can theoretically be provided at a Pareto optimal level under certain conditions because each rational individual reports true preferences to the government.
OGURO Kazumasa
ISHIDA Ryo
YASUOKA Masaya
2018-11
The Development of Digital Technology for IT, IoT, Big Data, and AI in Japan's Fourth Industrial Revolution
http://d.repec.org/n?u=RePEc:eti:rpdpjp:18019&r=all
This paper describes the first scientific and basic survey data which can explain the present situation of the development of digital technology for information technology (IT), Internet of Things (IoT), big data, and artificial intelligence (AI) in Japan's fourth industrial revolution. And this paper describes the result of the analysis of the survey study. Big companies are trying to develop new business using digital technology but SME's is still fall behind. The difference of each industrial sector is more clear. If this survey study shall be done every two years, the dynamic survey will be possible, which is the first purpose.
KIMOTO Hiroshi
SAWATANI Yuriko
SAITO Naho
IWAMOTO Koichi
TANOUE Yuta
INOUE Yusuka
2018-12
Early Labor Market Prospects and Family Formation
http://d.repec.org/n?u=RePEc:gat:wpaper:1835&r=all
We use quasi-random variation in graduation years during the onset of a very deep national recession to study the relationship between early labor market conditions and young females’ family formation outcomes. A policy-pilot affecting the length of upper-secondary vocational tracks allows us to compare females who graduated into the onset of the Swedish financial crisis of the 1990s to those graduating during the final phase of the preceding economic boom while netting out the main effect of the policy. We find pronounced, but short-lived, negative labor market effects from early exposure to the recession for low-grade students in particular. In contrast, we document very long-lasting effects on family formation outcomes, again concentrated among low-grade students. Young women who graduated into the recession because of the policy-pilot formed their first stable partnerships earlier and had their first children earlier. Their partners had lower grades, which we show to be a strong predictor of divorce, and worse labor market performance. Divorces were more prevalent and the ensuing increase in single motherhood was long-lasting. These negative effects on marital stability generated persistent increases in the use of welfare benefits despite the short-lived impact on labor market outcomes. The results suggest that young women respond to early labor market prospects by changing the quality threshold for entering into family formation, a process which affects the frequency of welfare-dependent single mothers during more than a decade thereafter.
Mattias Engdahl
Mathilde Godard
Oskar N. Skans
Family formation, female labor supply, cost of recessions
2018
Informality over the life-cycle
http://d.repec.org/n?u=RePEc:gat:wpaper:1834&r=all
In developing countries, informality is mainly concentrated on younger and older workers. In this paper, we propose a dual labor market theory that highlights how frictions and taxation in the formal sector as well as educational choices interact to shape the informality rate over the life-cycle. We develop a life-cycle model with search frictions, skill heterogeneities, and endogenous educational choices. We carry out a numerical analysis and show that our model reproduces remarkably well the life-cycle patterns of informality, non-employment and formal employment in Argentina. We analyze several public policies and show that an educational grant reduces both informality and non-employment and may be fully financed by the extra tax revenues generated by the increase in formal employment and wages. Lowering taxes may achieve similar results but is detrimental for the government budget, in the case of Argentina, despite increasing the base on which they are levied.
Julien Albertini
Anthony Terriau
Informality, Search and Matching, Life-cycle, Public policy, Laffer curve
2018
Financial services in the EU : Is there a problem of financial exclusion?
http://d.repec.org/n?u=RePEc:ems:euriss:112987&r=all
This study explores the link between the EU Social Investment Package and availability, access and use of financial services. There are two dimensions to ‘social investment’: the investment dimension refers to resources that need to be invested in order to increase welfare and capabilities of the population, whilst the social dimension is about society’s collective effort for raising such investment as well as sharing in its benefits.
Meskoub, M.
2018-12-14
Perceived Fairness in the Taxation of a Digital Business Model
http://d.repec.org/n?u=RePEc:ddf:wpaper:47&r=all
The “fair” taxation of digital business models is challenging. One of the key aspects – both policy makers and the public opinion consider as most pressuring – is the determination of intragroup transfer prices for intangibles used in digital business models. In this paper, we address the issue of a “perceived fair” taxation of the digital economy in the light of the arm’s length principle based on a survey with transfer pricing experts. The aim of the survey is not to estimate arm’s length profit allocations but rather to elicit fairness considerations in different transfer pricing related scenarios. In a digital economy framework where arm’s length profits are distributed extremely inequitably, subjects perceive this distribution of profits as most unfair compared to more balanced scenarios. Consequently, subjects propose a “fair” distribution of profits that substantially differs from the exogenously given arm’s length allocation. In scenarios with a more balanced arm’s length allocation of profits, we find that the perceived fairness for the expert groups increases while a control group of business students is almost not influenced by the arm’s length allocation of profits.
Greil, Stefan
Schwarz, Christian
Stein, Stefan
arm's length principle, corporate income tax, fairness, profit-shifting, Fremdvergleichsgrundsatz, Gewinnverlagerung, Unternehmensbesteuerung, digitale Geschäftsmodelle
Enabling Sustainable Savings and Investment Channels in Europe: Opportunities and Challenges
http://d.repec.org/n?u=RePEc:eps:ecmiwp:13799&r=all
Notwithstanding the significant differences between member states, the overexposure to bank deposits as well as the equity underweight in the portfolios of European households represent structural issues in Europe. Both market and regulatory developments should head in the direction of increasing access to suitable retail savings/investment products with comparable cost structures and stable returns in the long run. The onus of financial education should not only be on retail investors, but also on advisers and distributors, i.e. strictly monitored, properly trained professionals, regardless of captive or open distribution models. Multiple stakeholders need to be on board in working towards building and implementing the business-financial-societal case for sustainability. The use of financial regulation as a tool to provide incentives or disincentives for retail/institutional investors should be exercised with great caution and be complemented by other appropriate sectoral policies. This is essential in order to avoid a build-up in asset bubbles and further misallocation of resources. Moving sustainability from a niche segment will require a larger pool of sustainable assets and restoring confidence in the capacity of capital markets to generate long-term value in the real economy.
Amariei, Cosmina
2018-07
Analysis of the public spending on education and on social protection of children in the country
http://d.repec.org/n?u=RePEc:ftm:policy:2018-12/20&r=all
Blagica Petreski
Marjan Petreski
2018-12
The Baby Boomers and the Productivity Slowdown
http://d.repec.org/n?u=RePEc:fip:fedlwp:2018-037&r=all
The entry of baby boomers into the labor market in the 1970s slowed growth for physical and human capital per worker because young workers have little of both. Thus, the baby boom could have contributed to the 1970s productivity slowdown. I build and calibrate a model a la Huggett et al. (2011) with exogenous population and TFP to evaluate this theory. The baby boom accounts for 75% of the slowdown in the period 1964-69, 25% in 1970-74 and 2% in 1975-79. The retiring of baby boomers may cause a 2.8pp decline in productivity growth between 2020 and 2040, ceteris paribus.
Vandenbroucke, Guillaume
Demography; baby boom; aggregate productivity; productivity slowdown; human capital
2018-12-01
Empirical Studies on Effect of Property Tax on Capital Investment (Japanese)
http://d.repec.org/n?u=RePEc:eti:rdpsjp:18031&r=all
Property tax has been identified as a case of a "good" local tax in the literature. Such argument however presumes that property tax is levied solely on land. In practice, property tax applies to housing and depreciable assets such as machinery and buildings, which implies a feature of capital tax. It is known that capital tax distorts capital investment. The present paper analyzes the effects of property tax on capital investment. To be concrete, we use panel data of manufacture census such as Census of Manufacture and Economic Census for Business Activity, and examine how property tax on depreciable assets in Japan affects capital investments by small and medium enterprises. It is established that property tax negatively affects their investment and such adverse effects are exacerbated among enterprises with liquidity constraints.
KOBAYASHI Yohei
SATO Motohiro
SUZUKI Masaaki
2018-11
Consumer Credit, Digitalisation and Behavioural Economics: Are new protection rules needed?
http://d.repec.org/n?u=RePEc:eps:ecriwp:13831&r=all
In 2008, the Consumer Credit Directive (CCD) was significantly changed by adopting a targeted harmonisation approach that aimed at standardising information disclosure duties and imposing similar rights all around the EU. Ten years later, this new version of the CCD has increased consumer protection in some EU countries. At the same time, however, it has had limited impact on the emergence of a single market for consumer credit, as the volume of cross-border sales remains marginal. In this context, the European Commission recently launched an evaluation of the CCD to assess its interplay with other rules and whether its current provisions are still fit for purpose. Over the last decade, consumer credit markets have been transformed markedly. On the one hand, the fast digitalisation of the sector has contributed to new services, new processes and new providers. On the other hand, expanding knowledge of the behavioural biases of consumers has been slowly challenging the status quo of how authorities should design consumer protection rules. Both phenomena present opportunities that should be exploited by a possible new CCD, as well as risks that must be addressed, as summarised in the following recommendations: - Overall, a possible revision of the CCD should ensure that the new rules are anchored in the Digital Single Market Strategy. - The new CCD should contribute to unleashing the potential of digital tools in order to overcome barriers to cross-border sales of consumer loans. - The revision should place some emphasis on digital interoperability, data privacy and the extension of the scope of the CDD to new fintech business models. - In order to help mitigate the negative effects triggered by specific behavioural biases, personalised rather than standardised information disclosure should be encouraged. - Given that the digital world is likely to accelerate the average speed of consumer decisions, the right of withdrawal should be maintained. The right of early repayment should be clearly communicated, as the decision to reimburse earlier often works against some key behavioural biases.
Bouyon, Sylvain
Ayoub, Janna
2018-09
Analysis of the public spending on health care of children in the country
http://d.repec.org/n?u=RePEc:ftm:policy:2018-12/21&r=all
Maja Parnardzieva-Zmejkova
Vladimir Dimkovski
2018-12
Using Response Times to Measure Ability on a Cognitive Task
http://d.repec.org/n?u=RePEc:chu:wpaper:18-16&r=all
I show how using response times as a proxy for effort coupled with an explicit process-based model can address a long-standing issue of how to separate the effect of cognitive ability on performance from the effect of motivation. My method is based on a dynamic stochastic model of optimal effort choice in which ability and motivation are the structural parameters. I show how to estimate these parameters from the data on outcomes and response times in a cognitive task. In a laboratory experiment, I find that performance on a Digit-Symbol test is a noisy and biased measure of cognitive ability. Ranking subjects by their performance leads to an incorrect ranking by their ability in a substantial number of cases. These results suggest that interpreting performance on a cognitive task as ability may be misleading.
Aleksandr Alekseev
cognitive ability, test scores, response times, drift-diffusion model, choice-process data
2018
Norm making and institutions dynamics: how the research program of the French Régulation Theory can be fertilized by the methodological concepts from the “Max-Planck-Institute for European Legal History”
http://d.repec.org/n?u=RePEc:grt:wpegrt:2018-25&r=all
The aim of this paper is to show the possible connections between some legal history research methodologies and the research agenda of the Régulation Theory. As the last is a heterodox theory of institutions, cross-fertilizations with other fields of research open new research perspectives. In this respect, the methodology of the legal history research from the Max-Planck-Institute for European Legal History developed several methodological concepts like multinormativity, governance, science of regulation or law as communication. Such constructivist framework allows analyzing in vivo the norm-making and their incorporation into actors and social structures. In a context of trans-national regulation and growing autonomy of sectoral regulations, such in vivo analysis of the norm making can explain the genesis, transformation and destabilization of macro-economic institutions, which is the core interest of the Régulation Theory.
Samuel Klebaner
law and economics; legal history; normativity; régulation; institutions
2018
Cybersecurity in Finance: Getting the policy mix right!
http://d.repec.org/n?u=RePEc:eps:ecriwp:13703&r=all
In the midst of several large cyberattacks in 2017, the European Commission adopted its multi-sector cybersecurity package in September of that same year. Whereas this initiative can be expected to contribute to strengthening the cyber-resilience and response of EU financial firms, several policy issues and unanswered questions remain. In order to analyse the issues that are considered to be relevant to financial fields (retail banking, corporate banking, capital markets, financial infrastructure and insurance), CEPS-ECRI organised a Task Force between September 2017 and May 2018 with a group of experts from the financial industry, tech industry, national supervisors and European institutions, as well from a consumer association and a law firm. In this Final Report, the Task Force members identify the following nine policy issues that need to be further addressed in order to bolster the financial industry’s cyber-resilience against current and future threats. Main policy recommendations 1. Convergence in the taxonomies of cyber-incidents is needed. 2. The framework for incident reporting needs to be significantly improved to fully contribute to the cyber-resilience of financial firms. 3. Authorities should assess how and to what extent the data held by the centralised hub should be shared with supervisors, firms and clients. 4. Ambitious policies are needed to develop consistent, reliable and exploitable statistics on cyber-trends. 5. Best practices for cyber-hygiene should be continuously enhanced by regulators and supervisors. 6. The European Cybersecurity Certification Scheme needs to be strengthened to contribute better to cybersecurity, cyber-risk management and capability. 7. In order to improve the processes of attribution and extradition, the reinforcement of cross-border cooperation and legal convergence remains a priority, both within the EU and more widely. 8. Best practices in remedies in case of cyberattacks need to be further encouraged. 9. Policy-makers should further assess the pros, cons and feasibility of creating an emergency fund in case of large cyberattacks.
Bouyon, Sylvain
Krause, Simon
2018-06
Measuring the effectiveness of volatility auctions
http://d.repec.org/n?u=RePEc:col:000122:016988&r=all
Carlos Castro
Diego A. Agudelo
Sergio Preciado
2018-07-31
An Overview of Interest-Only Mortgages in Ireland
http://d.repec.org/n?u=RePEc:cbi:fsnote:03/18&r=all
This note provides insights into interest-only mortgage lending in Ireland. Most interestonly loans outstanding as at 2017 were extended to buy-to-let (BTL) investors before 2007. Loans originated as interest-only are more likely to be on low tracker interest rates and to have relatively higher loan-to-value (LTV) ratios, with significant shares of negative equity and non-performing loans. Since 2015, less than 2 per cent of BTL loans were agreed on an interest-only repayment schedule. These loans are subject to Central Bank of Ireland mortgage measures, under which recent BTL lending has had average originated LTV ratios significantly below the 70 per cent threshold. Across Europe, only a small number of regulators impose minimum principal repayment requirements.
Gaffney, Edward
Kinghan, Christina
Nevin, Ciarán
2018-07
Long-Term Mortgage Arrears in Ireland
http://d.repec.org/n?u=RePEc:cbi:fsnote:07/18&r=all
Approximately 29,000 residential mortgages in Ireland have accumulated at least two years worth of missed payments as of March 2018. In this paper, I analyse a sample of these mortgages in long-term arrears. By end-2017, the number of loans entering long-term mortgage arrears slowed to its lowest rate since the crisis began. The number of loans leaving long-term arrears has also generally slowed. Roughly half of the loans leaving long-term arrears in 2017 are due to voluntary and involuntary lossof- ownership, compared with less than a third three years ago. The remaining longterm arrears mortgages have an average arrears balance of e66,000 and the estimated average loan-to-value ratio is close to 90%. The balances in arrears are on average around one fth of the estimated value of the property.
O'Malley, Terry
2018-09
Efectos del crédito hipotecario sobre el precio de la vivienda nueva NO VIS en Medellín
http://d.repec.org/n?u=RePEc:col:000122:016976&r=all
John J. Garcia-Rendon
Natalia Cadavid Arcila
Erika Tatiana Aristizábal Zuluaga
2018-11-29
Measuring Profit Efficiency of Colombian Banks: A Composite Nonstandard Profit Function Approach
http://d.repec.org/n?u=RePEc:col:000122:016986&r=all
Diego Restrepo-Tobón
Jim Sánchez-González
2018-08-27
Macroprudential Measures and Irish Mortgage Lending: An Overview of 2017
http://d.repec.org/n?u=RePEc:cbi:fsnote:01/18&r=all
This note provides an overview of residential mortgage lending in Ireland in 2017. It uses data reported to the Central Bank of Ireland as part of the macroprudential mortgage measures. In total, 35,472 loans are covered with a value of e7.4 billion. For first-time buyers (FTBs), the average loan-to-value (LTV) and loan-to-income (LTI) were 79.8 per cent and 3.0 times gross income respectively. Regarding the LTI limit, 18 per cent of the aggregate value of lending to both FTBs and second and subsequent buyers (SSBs) exceeded the limit of 3.5 in 2017. This corresponds to 25 per cent of the value of FTB lending and 10 per cent of the value of SSB lending. Regarding LTV, 17 per cent of the aggregate value of SSB lending in 2017 exceeded the 80 per cent LTV limit. On average, borrowers with an LTI allowance had larger loan sizes and loan terms, were more likely to be based in Dublin and be single compared to those borrowers without an LTI allowance. SSBs with an LTV allowance had larger loan sizes and incomes but lower property values and were younger than those without an LTV allowance.We observe that allowances were allocated to borrowers in all four quarters of 2017.
Kinghan, Christina
Lyons, Paul
Mazza, Elena
2018-04
Strategic Teaching and Learning in Games
http://d.repec.org/n?u=RePEc:cda:wpaper:232&r=all
It is known that there are uncoupled learning heuristics leading to Nash equilibrium in all finite games. Why should players use such learning heuristics and where could they come from? We show that there is no uncoupled learning heuristic leading to Nash equilibrium in all finite games that a player has an incentive to adopt, that would be evolutionary stable or that could "learn itself". Rather, a player has an incentive to strategically teach such a learning opponent in order to secure at least the Stackelberg leader payoff. The impossibility result remains intact when restricted to the classes of generic games, two-player games, potential games, games with strategic complements or 2 x 2 games, in which learning is known to be "nice". More generally, it also applies to uncoupled learning heuristics leading to correlated equilibria, rationalizable outcomes, iterated admissible outcomes, or minimal curb sets. A possibility result restricted to "strategically trivial" games fails if some generic games outside this class are considered as well.
Burkhard Schipper
Learning in games, Interactive learning, Higher-order learning
2017-05-01
Caste and the Indian Economy
http://d.repec.org/n?u=RePEc:cam:camdae:1759&r=all
Caste plays a role at every stage of an Indian's economic life; in school, university, the labor market, and into old age. The influence of caste extends beyond private economic activity into the public sphere, where caste politics determines access to public resources. The aggregate evidence indicates that there has been convergence in education, occupations, income, and access to public resources across caste groups in the decades after independence. Some of this convergence is likely due to affirmative action, but caste-based networks could also have played an equalizing role by exploiting the opportunities that became available in a globalizing economy. Ethnic networks were once active in many advanced economies, but ceased to be salient once markets developed. With economic development, it is possible that caste networks will cease to be salient in India. The affirmative action programs may also be rolled back and (statistical) discrimination in urban labor markets may come to an end, if and when there is convergence across caste groups. In the interim period, however, it is important to understand the positive and negative consequences of caste involvement across a variety of spheres in the Indian economy.
Munshi, K.
Caste, Affirmative Action, Community networks, Migration, Mobility, Education, Business, Risk-Sharing, Public Goods, Politics.
2017-06-01
Residential property price segments and mortgage finance
http://d.repec.org/n?u=RePEc:cbi:fsnote:11/18&r=all
I measure shares of mortgage finance in different price segments of the property market by comparing loan-level records of mortgage originations by Irish banks to the national register of property transactions between February 2015 and June 2018. Mortgage finance is more frequent at higher prices for all but the most expensive properties, rising from 5 per cent of purchases in the first price decile to 72 per cent in the ninth decile. The relationship between price and finance is similar in urban and rural regions. Price grew more quickly between 2015 and 2018 at lower price levels, where buyers rely less on mortgage finance.
Gaffney, Edward
2018-11
Strategic Reasoning in Persuasion Games: An Experiment
http://d.repec.org/n?u=RePEc:cda:wpaper:111&r=all
We study experimentally persuasion games in which a sender (e.g., a seller) with private information provides verifiable but potentially vague information (e.g., about the quality of a product) to a receiver (e.g., a buyer). Various theoretical solution concepts such as sequential equilibrium or iterated admissibility predict unraveling of information. Iterative admissibility also provides predictions for every finite level of reasoning about rationality. Overall we observe behavior consistent with relatively high levels of reasoning. While iterative admissibility implies that the level of reasoning required for unraveling is increasing in the number of quality levels, we find only insignificantly more unraveling in a game with two quality levels compared to a game with four quality levels. There is weak evidence for learning higher-level reasoning in later rounds of the experiments. Participants display difficulties in transferring learning to unravel in a game with two quality levels to a game with four quality levels. Finally, participants who score higher on cognitive abilities in Raven's progressive matrices test also display significantly higher levels of reasoning in our persuasion games although the effect-size is small.
Burkhard Schipper
Ying Xue Li
Persuasion games, verifiable information, communication, disclosure, unraveling, iterated admissibility, prudent rationalizability, common strong cautious belief in rationality, level-k reasoning, experiments, cognitive ability.
2018-02-19
Transmission of Monetary Policy and Bank Heterogeneity in Colombia
http://d.repec.org/n?u=RePEc:col:000122:016987&r=all
Carolina Ortega Londoño
Diego Restrepo
2018-06-30
Strategic behaviour in a capacity market? The new Irish electricity market design
http://d.repec.org/n?u=RePEc:cam:camdae:1863&r=all
The transition to a low-carbon power system requires growing the share of generation from (intermittent) renewables while ensuring security of supply. Policymakers and economists increasingly see a capacity mechanism as a way to deal with this challenge. Yet this raises new concerns about the exercise of market power by large players via the capacity auction. We present a new modelling approach that captures such strategic behaviour together with a set of ex ante empirical estimates for the new Irish electricity market design (I-SEM) – in which a single firm controls 44% of generation capacity (excluding wind). We find significant costs of strategic behaviour, even with new entry: In our baseline scenarios, procurement costs in the capacity auction are around 150-400 million EUR (or 40-100%) above the competitive least-cost solution. From a policy perspective, we also examine how market power can be measured and mitigated through auction design.
Teirilä, J.
Ritz, R.
capacity market, strategic behaviour, competitive benchmark analysis, restructured electricity market, auction design
2018-10-30
Redes inteligentes y mecanismo de respuesta de la demanda: el caso del sector eléctrico colombiano
http://d.repec.org/n?u=RePEc:col:000122:017010&r=all
John Jairo García
Alejandro Gutiérrez
Luisa Vargas
Hermilson Velásquez
Respuesta de la demanda, ARIMAX – ARCH, Beneficios económicos, Colombia.
2018-11-01
External Balance Sheet Risks in Ireland
http://d.repec.org/n?u=RePEc:cbi:fsnote:09/18&r=all
Large external imbalances have been a persistent feature of most advanced economies, including Ireland. This is despite significant deleveraging of the Irish banking sector since the financial crisis. Given the presence of internationally oriented activities with little Irelandrelated business, early-warning indicator metrics related to the international investment position require adjustments in order to serve as useful monitoring tools.We propose to focus on a metric related to the net external debt liabilities of a narrow set of domestic Irish banks: a closer monitoring of the external balance-sheet risk is warranted when the net external debt liabilities of domestic banks exceed 17 per cent of modified gross national income.
Galstyan, Vahagn
Herzberg, Valerie
2018-10
Inefficiency and Bank Failures: A Joint Bayesian Esti-mationof a Stochastic Frontier Model and a Hazards Model
http://d.repec.org/n?u=RePEc:col:000122:016977&r=all
Jim Sánchez
Diego Restrepo
Andres Ramírez
2018-11-29
International bank flows and bank business models since the crisis
http://d.repec.org/n?u=RePEc:cbi:fsnote:05/18&r=all
Developments in cross-border banking and bank business models have implications for international risk sharing. During the European sovereign debt crisis, cross-border banks only provided limited risk sharing and even amplified shocks in some euro area Member States. Policymakers responded by introducing an array of prudential instruments to improve bank resilience. This successfully strengthened the euro area banking system, fostering certain bank business models while disincentivising others. Euro area banks are now: (i) more domestically oriented with less cross-border activity; (ii) smaller; (iii) less trading, more lending oriented; (iv) more deposit funded. Conservative business models have advantages from a financial stability perspective, but they may also mitigate the advantages of cross-border activities for banks and the economy. Reforms may be necessary if banks are to play a greater role as a shock absorber in the European banking union.
Herzberg, Valerie
McQuade, Peter
2018-08
Kuhn's Theorem for Extensive Games with Unawareness
http://d.repec.org/n?u=RePEc:cda:wpaper:204&r=all
We extend Kuhn's Theorem to extensive games with unawareness. This extension is not entirely obvious: First, extensive games with non-trivial unawareness involve a forest of partially ordered game trees rather than just one game tree. An information set at a history in one tree may consist of histories in a less expressive tree. Consequently, perfect recall takes a more complicated form as players may also become aware of new actions during the play. Second, strategies can only be partially an object of ex-ante choice in games with unawareness. Finally, histories that a player may expect to reach with a strategy profile may not be the histories that actually occur with this strategy profile, requiring us to define appropriate notions of equivalence of strategies.
Burkhard Schipper
perfect recall, mixed strategy, behavior strategy, unawareness.
2017-11-01
Cures and Exits: the drivers of NPL resolution in Ireland from 2012 to 2017
http://d.repec.org/n?u=RePEc:cbi:fsnote:06/18&r=all
Non-performing loan (NPL) balances in the Irish retail banking system declined from e85bn in 2013 to around e25bn in 2017. In this Note, we document how this decline came about using regulatory return data and loan-level data for all property-related lending segments. Firstly, we highlight that NPL resolution is a gradual process: the majority of NPL balances in one year remain as NPLs a year later. Secondly, we show that loan “cure” (the return of previously-defaulted balances to Performing Loan status) is the key driver of NPL reduction in the residential mortgage segment. This is particularly true for principal dwelling home mortgages, where loan restructuring has played a pivotal role. In contrast, loan exit —through liquidations, write-offs, and sales—accounts for a large majority of the NPL reduction in the commercial real estate segment, where concerns about borrowers’ access to housing are less central to the policy discussion. Buy-to-Let (BTL) mortgages, on the other hand, share some of the characteristics of each of the aforementioned asset classes: Exit plays a relatively more important role for BTLs than for PDH mortgages, while Cure plays a greater for BTLs than it does for CRE loans.
McCann, Fergal
McGeever, Niall
2018-09
Political Awareness, Microtargeting of Voters, and Negative Electoral Campaigning
http://d.repec.org/n?u=RePEc:cda:wpaper:228&r=all
We study the informational effectiveness of electoral campaigns. Voters may not think about all political issues and have incomplete information with regard to political positions of candidates. Nevertheless, we show that if candidates are allowed to microtarget voters with messages then election outcomes are as if voters have full awareness of political issues and complete information about candidate's political positions. Political competition is paramount for overcoming the voter's limited awareness of political issues but unnecessary for overcoming just uncertainty about candidates' political positions. Our positive results break down if microtargeting is not allowed or voters lack political reasoning abilities. Yet, in such cases, negative campaigning comes to rescue.
Burkhard Schipper
Hee Yeul Woo
Electoral competition, campaign advertising, multidimensional policy space, microtargeting, dog-whistle politics, negative campaigning, persuasion games, unawareness
2017-05-01
A Vulnerability Analysis for Mortgaged Irish Households
http://d.repec.org/n?u=RePEc:cbi:fsnote:02/18&r=all
This note assesses the vulnerability of mortgaged Irish households to financial shocks. It uses the Central Bank of Ireland’s Loan Loss Forecasting internal model and employs loan level data provided by the five main mortgage lenders. The model calculates a vulnerability index for currently performing mortgages under a certain adverse scenario which involves movements in the unemployment rate, house prices and interest rates. The model predicts that the most vulnerable households are those with high current loan-to-value ratios, multiple loans, loans that originated between 2004 and 2009 and those in South-East, Midland and Border region.
Tsiropoulos, Vasilis
2018-05
Macroprudential Measures and Irish Mortgage Lending: Insights from H1 2018
http://d.repec.org/n?u=RePEc:cbi:fsnote:08/18&r=all
This note provides an overview of residential mortgage lending in Ireland in H1 2018. In total, 17,415 loans are covered with a value of e3.75 billion. The majority (97 per cent) of lending in-scope of the mortgage measures was for primary dwelling (PDH) loans. For firsttime buyers (FTBs), the average loan-to-value (LTV) and loan-to-income (LTI) were 79.6 per cent and 3.1 times gross income, respectively. Regarding the LTV limit, 16 per cent of the total value of second and subsequent buyers (SSB) lending in H1 2018 exceeded the 80 per cent LTV limit. Regarding the LTI limit, 23 per cent of the aggregate value of FTB lending exceeded the LTI limit, with 9 per cent of the value of SSB lending originated with an LTI above 3.5. On average, borrowers with an LTI allowance had larger loan sizes and loan terms, were more likely to be based in Dublin and be a single applicant compared to those borrowers without an LTI allowance. SSBs with an LTV allowance had larger loan sizes and incomes and were younger than those without an LTV allowance. These trends were similar to those observed in H1 2017.
Kinghan, Christina
2018-10
A nyugdíjrendszer helyzete és finanszírozhatósága
http://d.repec.org/n?u=RePEc:pra:mprapa:90399&r=all
As a result of the demographic processes, one of the major challenges facing aging societies is to ensure long-term and sustainable funding for old-age care. The Hungarian pension system is basically stagnating, and the political competition focuses only on welfare corrections, shattering the real and increasingly threatening threats. In recent years, however, several detailed studies and analyses have been published, which, according to internationally accepted norms of economics, anticipate the gradual lack of the Hungarian pension system. The analysis covers the following topics: legal and institutional background, retirement demographics, real value of pensions, reforms and problems affecting the pension system (private pension funds, reduced retirement opportunities, raising age pension fund ceiling, one-person personal income), pension funding and institutional system.
Vértesy, László
pension system, pensions, demography
2018-10
Efectos del crédito hipotecario sobre el precio de la vivienda nueva NO VIS en Medellín
http://d.repec.org/n?u=RePEc:col:000122:017009&r=all
John Jairo García
Nathalia Cadavid
Érika Aristizábal
Mortgage rate, mortgage credit, new housing price, NO VIS housing
2018-11-01
Irish retail bank profitability 2003-20018
http://d.repec.org/n?u=RePEc:cbi:fsnote:10/18&r=all
This FS Note explores trends in the profitability of the Irish retail banking sector over the past 15 years, using a sample of 39 other EU banks as a comparison group. Changes in the net interest margin (NIM) are decomposed into the share and yield effects on assets and liabilities, respectively. This is the first such decomposition to focus on the banking system in Ireland. The results suggest that the low interest rate environment has coincided with an increase in the NIM of Irish banks but with a decrease in the NIM for a sample of other EU banks. In the case of Irish banks, the increase in the NIM is largely the result of a yield effect on liabilities (cheaper funding). Furthermore, there is some evidence that this effect may be diminishing in recent years.
Nevin, Ciarán
2018-11
Increase-Decrease Game under Imperfect Competition in Two-stage Zonal Power Markets Part II: Solution Algorithm
http://d.repec.org/n?u=RePEc:cam:camdae:1870&r=all
In part I of this paper, we proposed a Mixed-Integer Linear Program (MILP) to analyse imperfect competition of oligopoly producers in two-stage zonal power markets. In part II of this paper, we propose a solution algorithm which decomposes the proposed MILP model into several subproblems and solve them in parallel and iteratively. Our solution algorithm reduces the solution time of the MILP model and it allows us to analyze largescale examples. To tackle the multiple Subgame Perfect Nash Equilibria (SPNE) situation, we propose a SPNE-band approach. The SPNE band is split into several subintervals and the proposed solution algorithm finds a representative SPNE in each subinterval. Each subinterval is independent from each other, so this structure enables us to use parallel computing. We also design a pre-feasibility test to identify the subintervals without SPNE. Our proposed solution algorithm and our SPNE-band approach are demonstrated on the 6-node and the modified IEEE 30-node example systems. The computational tractability of our solution algorithm is illustrated for the IEEE 118-node and 300-node systems.
Sarfatia, M.
M., Hesamzadeha.
Holmberg, P.
Modified Benders decomposition, Multiple Subgame Perfect Nash equilibria, Parallel computing, Wholesale electricity market, Zonal pricing
2018-11-28
Demanda de dinero en América Latina, 1996-2016: una aplicación de cointegración en datos de panel
http://d.repec.org/n?u=RePEc:col:000122:017008&r=all
Alfredo Villca
Alejandro Torres
Carlos Esteban Posada
Hermilson Velásquez
2018-04-30
Increase-Decrease Game under Imperfect Competition in Two-stage Zonal Power Markets Part I: Concept Analysis
http://d.repec.org/n?u=RePEc:cam:camdae:1869&r=all
This paper is part I of a two-part paper. It proposes a two-stage game to analyze imperfect competition of producers in zonal power markets with a day-ahead and a real-time market. We consider strategic producers in both markets. They need to take both markets into account when deciding what to bid in each market. The demand shocks between these markets are modeled by several scenarios. The two-stage game is formulated as a Twostage Stochastic Equilibrium Problem with Equilibrium Constraints (TS-EPEC). Then it is further reformulated as a two-stage stochastic Mixed-Integer Linear Program (MILP). The solution of this MILP gives the Subgame Perfect Nash Equilibrium (SPNE). To tackle multiple SPNE, we design a procedure which _nds all SPNE with di_erent total dispatch costs. The proposed MILP model is solved using Benders decomposition embedded in the CPLEX solver. The proposed MILP model is demonstrated on the 6-node and the IEEE 30-node example systems.
Sarfatia, M.
M., Hesamzadeha.
Holmberg, P.
Two-stage game, Zonal pricing, Two-stage equilibrium problem with equilibrium constraints, Wholesale electricity market
2018-11-28
Restructuring the Chinese Electricity Supply Sector - How industrial electricity prices are determined in a liberalized power market: lessons from Great Britain
http://d.repec.org/n?u=RePEc:cam:camdae:1871&r=all
In this paper, we begin by discussing the components of the price of industrial electricity in Great Britain, as an example of a fully reformed electricity market, where the market is roughly comparable in size to a reasonably large Chinese province. We go on to discuss the key actors in the liberalized electricity system in Great Britain, before unpacking each of the components of the price. We discuss the market determined elements first, then go on to introduce and discuss the regulated elements of the price before finishing with the central government determined price components. Our discussion covers the determination of the wholesale price, the retail margin, transmission charges, system balancing charges, distribution charges and environmental levies and taxes. In each of these cases we discuss the process by which they are determined (led by the market, the regulator, the central government or more than one) and the specific lessons for China. We conclude by emphasizing some of the high-level lessons on electricity price determination for China.
Pollitt, M.
Dale, L.
Chinese power market reform; industrial electricity price; electricity liberalization
2018-11-28
Pass-through, profits and the political economy of regulation
http://d.repec.org/n?u=RePEc:cam:camdae:1859&r=all
Government regulation, such as the pricing of externalities, often raises the unit costs of regulated firms, and its impact on their profits is important to its political economy. We introduce a reduced-form model (“GLM”) that nests existing models of imperfect competition under weaker assumptions. We show how a firm's cost passthrough is a sufficient statistic for the profit impact of regulation. We apply the GLM to carbon pricing for US airlines. We find large inter-firm heterogeneity in pass-through, even for a uniform cost shock. The GLM allows us to sidestep estimation of a consumer demand system, firm markups and conduct parameters. We derive the second-best emissions tax including lobbying a government “for sale”.
Grey, F.
Ritz, R.
Cost pass-through, regulation, carbon pricing, airlines, political economy
2018-10-17
Redes inteligentes y mecanismo de respuesta de la demanda: el caso del sector eléctrico colombiano Smart grids and demand response mechanism: the case of the Colombian electricity market?
http://d.repec.org/n?u=RePEc:col:000122:016975&r=all
John J. Garcia-Rendon
Alejandro Gutiérrez Gómez
Luisa Vargas Tobón
Hermilson Velasquez Ceballos
2018-11-29
Measuring and mitigating cyclical systemic risk in Ireland: The application of the countercyclical capital buffer
http://d.repec.org/n?u=RePEc:cbi:fsnote:04/18&r=all
Following a number of years where the activation of the countercyclical capital buffer was limited, it is now becoming an increasingly relevant and actively used macroprudential policy tool across Europe. Against this background, this Note describes the high-level approach taken by the Central Bank of Ireland in setting the countercyclical capital buffer rate applicable to Irish exposures. In addition, the Note discusses issues around the identification of cyclical systemic risk in Ireland, and in particular the role of the credit-to-GDP gap as an appropriate reference indicator for countercyclical capital buffer rate decisions. The Note introduces work within the Central Bank of Ireland to develop a potential alternative reference indicator for informing countercyclical capital buffer decisions. In particular, an alternative measure of the national credit gap which looks to account for structural shifts in the economy and informs the estimation of the cycle through additional variables. This semi-structural measure of cyclical systemic risk addresses some of the main drawbacks of purely statistical methods such as excessively persistent trends, a feature that is particularly desirable in post-crisis circumstances.
O'Brien, Eoin
O'Brien, Martin
Velasco, Sofia
2018-07
Does Exposure to Unawareness Affect Risk Preferences? A Preliminary Result
http://d.repec.org/n?u=RePEc:cda:wpaper:255&r=all
One fundamental assumption often made in the literature on unawareness is that risk preferences are invariant to changes of awareness. We study how exposure to unawareness affects choices under risk. Participants in our experiment choose repeatedly between varying sure outcomes and a lottery in 3 phases. All treatments are exactly identical in phase 1 and phase 3, but differ in phase 2. There are five different treatments pertaining to the lottery faced in phase 2: The control treatment (i.e., a standard lottery), the treatment with awareness of unawareness of lottery outcomes but known number of outcomes, the treatment with awareness of unawareness of outcomes but with unknown number of outcomes, the treatment with unawareness of unawareness of some outcomes, and the treatment with an ambiguous lottery. We study both whether behavior differs in phase 3 across treatments (between subjects effect) and whether differences of subjects' behavior between phases 1 and phase 3 differs across treatments (within subject effects). We observe no significant treatment effects.
Burkhard Schipper
Wenjun Ma
Unawareness, Awareness of unawareness, Risk aversion, Experiments
2017-05-01
Economic Assessment of Using Electric Vehicles and Batteries as Domestic Storage Units in the United Kingdom
http://d.repec.org/n?u=RePEc:cam:camdae:1858&r=all
Increasing residential renewable energy generation and the consumers’ demand for reducing their electricity bills leads to new opportunities to use electric vehicles (EVs) and batteries as domestic storage units. This paper assesses the economic feasibility of Vehicle-to-Home (V2H) and domestic battery systems in the United Kingdom (UK). To do the analysis, a UK average EV and domestic battery have been established; called UKEV and UKBat respectively. The UKEV characteristics were determined by taking a weighted average from the five highest selling EVs in the UK. An arithmetic mean was used for the individual UKBat features based on seven models currently available on the UK market. The UKEV and UKBat were compared under four scenarios. These are Ofgem’s two domestic electricity profile classes (PC1, PC2) and two existing time-of-use tariffs; one with two and the other with three rates during a day. Maximum annual saving for the consumer was estimated to be around 35% and 57% per annual electricity bill for the EV and battery, respectively. On average, for both UKEV and UKBat, the three-rate tariff yielded 30% more savings than the two-rate tariff. Battery degradation cost was the major parameter affecting the economic feasibility of V2H and domestic batteries, but these costs are expected to continue to fall. Suitable time-of-use tariff design is the key to maximising consumers’ savings in using these units.
Donato A. Melchiorre.
Sinan Küfeoglu
electric vehicles; battery; vehicle-to-home systems; tariffs
2018-10-16
Qualitative analysis of common belief of rationality in strategic-form games
http://d.repec.org/n?u=RePEc:cda:wpaper:181&r=all
We study common belief of rationality in strategic-form games with ordinal utilities, employing a model of qualitative beliefs. We characterize the three main solution concepts for such games, viz., Iterated Deletion of Strictly Dominated Strategies (IDSDS), Iterated Deletion of Boergers-dominated Strategies (IDBS) and Iterated Deletion of Inferior Strategy Profiles (IDIP), by means of gradually restrictive properties imposed on the models of qualitative beliefs. As a corollary, we prove that IDIP refines IDBS, which refines IDSDS.
Giacomo Bonanno
Elias Tsakas
Qualitative likelihood relation, ordinal payoffs, common belief of rationality, iterative deletion procedures
2017-05-11
Asset Safety versus Asset Liquidity
http://d.repec.org/n?u=RePEc:cda:wpaper:326&r=all
Recently, a lot of attention has been paid to the role “safe and liquid assets” play in the macroeconomy. Many economists take as given that safer assets will also be more liquid, and some go a step further by practically using the two terms as synonyms. However, they are not synonyms: safety refers to the probability that the (issuer of the) asset will pay the promised cash flow, and liquidity refers to the ease with which an asset can be sold if needed. Mixing up these terms can lead to confusion and wrong policy recommendations. In this paper, we build a multi-asset model in which an asset’s safety and liquidity are well-defined and distinct from one another. Treating safety as a primitive, we examine the relationship between an asset’s safety and liquidity in general equilibrium. We show that the commonly held belief that “safety implies liquidity” is generally justified, but there may be exceptions. We then describe the conditions under which a relatively riskier asset can be more liquid than its safe(r) counterparts. Finally, we use our model to rationalize the puzzling observation that AAA corporate bonds are considered less liquid than (the riskier) AA corporate bonds.
Athanasios Geromichalos
Lucas Herrenbrueck
Sukjoon Lee
asset safety, asset liquidity, over-the-counter markets, liquidity premium
2018-11-19
Muddying the waters: Who Induces Volatility in an Emerging Market?
http://d.repec.org/n?u=RePEc:col:000122:016974&r=all
Paula A. Yepes-Henao
Diego A. Agudelo
Ramazan Gencay
2018-11-29
Departure time choice equilibrium and optimal transport problems
http://d.repec.org/n?u=RePEc:pra:mprapa:90361&r=all
This paper presents a systematic approach for analyzing the departure-time choice equilibrium (DTCE) problem of a single bottleneck with heterogeneous commuters. The approach is based on the fact that the DTCE is equivalently represented as a linear programming problem with a special structure, which can be analytically solved by exploiting the theory of optimal transport combined with a decomposition technique. By applying the proposed approach to several types of models with heterogeneous commuters, it is shown that the dynamic equilibrium distribution of departure times exhibits striking regularities under mild assumptions regarding schedule delay functions, in which commuters sort themselves according to their attributes, such as desired arrival times, schedule delay functions (value of times), and travel distances to a destination.
Akamatsu, Takashi
Wada, Kentaro
Iryo, Takamasa
Hayashi, Shunsuke
departure time choice equilibrium, linear programming, optimal transport, sorting
2018-12-04
Comprehensive Rationalizability
http://d.repec.org/n?u=RePEc:cda:wpaper:186&r=all
We present a new solution concept for strategic games called comprehensive rationalizability that embodies "common cautious belief in rationality" based on a sound epistemic characterization in a universal type space. It refines rationalizability, but it neither refines nor is refined by iterated admissibility. Nevertheless, it coincides with iterated admissibility in many relevant economic applications.
Burkhard Schipper
Martin Meier
Aviad Heifetz
Common assumption of rationality, common belief in rationality, iterated admissibility, rationalizability, lexicographic belief systems
2017-05-01
Pricing in Day-Ahead Electricity Markets with Near-Optimal Unit Commitment
http://d.repec.org/n?u=RePEc:cam:camdae:1872&r=all
This paper revisits some peculiar pricing properties of near-optimal unit commitment solutions. Previous work has found that prices can behave erratically even as unit commitment solutions approach the optimal solution, resulting in potentially large wealth transfers due to suboptimality of the solution. Our analysis considers how recently proposed pricing models affect this behavior. Results demonstrate a previously unknown property of one of these pricing models, called approximate Convex Hull Pricing (aCHP), that eliminates erratic price behavior, and therefore limits wealth transfers with respect to the optimal unit commitment solution. The absence of wealth transfers may imply fewer strategic bidding incentives, which could enhance market efficiency.
Eldridge, B.
O’Neill, R.
Hobbs, B.
Unit commitment, nonconvex pricing, mixed integer programming, market design
2018-11-28
Foresight as a governance tool to help shape the next production revolution
http://d.repec.org/n?u=RePEc:pra:mprapa:90370&r=all
The next production revolution (NPR; also called Industry 4.0 elsewhere) is likely to trigger complex changes via the interactions of new technologies, materials, processes, and business models. These changes would affect R&D and innovation activities; the labour market; income distribution and well-being; skill requirements; as well as several fields of regulation. Furthermore, digitalisation can be a major enabler of the circular economy. The policy implications of the NPR are so wide-ranging that it is difficult to mention a major policy domain, which would remain untouched by these sweeping changes. The need for policy orchestration is, therefore, rather strong. Foresight, a specific type of forward-looking activities (FLA), can assist policy-makers in dealing with these complex changes. First, it facilitates a systemic approach, considers multiple futures and draws on the diverse set of knowledge of participants. Second, a shared vision, developed – and thus ‘owned’ – by the participants, can reduce the uncertainties generated by NPR, and it helps building commitment among participants as an additional factor to keep up the momentum of orchestrated policy design and implementation. Third, a transformative foresight process, considering and assisting systemic changes triggered by NPR, can contribute to reshaping the prevailing power structures and invigorating policy rationales, decision-making processes, and thus improving the efficacy of policies. FLA projects dealing with NPR issues vary in their thematic coverage and their breadth of participation. Combining these distinctions, four different archetypes of FLA are identified – and illustrated by actual cases – in the paper. The expected impacts on policy-making vary by the type of prospective analyses. Participatory processes mobilise a wider set of knowledge, aspirations, and worldviews compared to an expert-based project. Hence, more novel ideas can be expected, contested from various angles, hence tested more thoroughly, given the diversity of participants. FLA projects focusing on innovation and manufacturing systems consider a broader set of issues than S&T-centred projects. Given the complex issues brought about by the NPR, such a systemic approach seems to be more appropriate as a foundation for devising effective policies. In certain contexts, S&T-centred FLA can also be useful, but different and only more limited benefits and impacts can arise from this approach. Foresight benefits are far from being automatic: the paper considers eight critical factors to achieve those. An astute embedding of foresight into policy-making enhances the likelihood of impact, but foresight recommendations are no substitute for policy decisions and actions.
Havas, Attila
Weber, Matthias
The next production revolution; Typology of FLA; Expected impacts of FLA; Foresight benefits
2018-11-15
Wage premia for skills: The complementarity of cognitive and non-cognitive skills
http://d.repec.org/n?u=RePEc:ibt:wpaper:wp092018&r=all
This paper provides evidence on the association between individuals' cognitive abilities, personality traits, and earnings. I find that cognitive skills and certain personality traits are complements. In particular, I find that cognitive skills and emotional stability are complementary, with neurotic individuals having significantly lower returns to their cognitive skills. Furthermore, my results indicate that agreeableness, neuroticism, and – surprisingly – grit are penalised signi?cantly in the labour market; and that there is a positive relationship between conscientiousness and wages. Finally, I observe that, contrary to previous findings, women and men have similar returns to personality traits. I use well-established measures of cognitive skills and personality: namely, competence tests from the PIAAC survey to assess cognitive skills, as well as the Big Five inventory and the Grit scale to assess personality traits.
Marta Palczynska
cognitive skills, personality traits, social skills, earnings
2018-12
Homeownership, Labour Market Transitions and Earnings
http://d.repec.org/n?u=RePEc:lvl:crrecr:1819&r=all
The paper investigates the links between homeownership, employment and earnings for which no consensus exists in the literature. Our analysis is cast within a dynamic setting and the endogeneity of each outcome is assessed through the estimation of a flexible panel multivariate model with random effects. The data we use are drawn from the French sample of the EU Survey on Income and Living Conditions for the years 2004Ð2013. The error terms are both correlated across equations and autocorrelated. Individual random effects are also correlated across equations. The model is estimated using a simulated maximum likelihood estimator and particular care is given to the initial conditions problem. Our results show that while homeowners have longer employment and unemployment spells, they must contend with lower earnings than tenants upon reemployment. They also stress the importance of unobserved heterogeneity in explaining the transitions on the labour and housing markets, and the relationship between earnings and the latter two. Failure to properly account for this is likely to yield biased parameter estimates.
Thierry Kamionka
Guy Lacroix
Homeownership,Unemployment,Earnings,Heterogeneity,Simulation based estimation,panel data
2018
Fundamentalness, Granger Causality and Aggregation
http://d.repec.org/n?u=RePEc:mod:recent:139&r=all
The testing procedure suggested in Canova and Sahneh (2018) is essentially the same as the one proposed in Forni and Gambetti (2014), the only one difference being the use of Geweke, Meese and Dent (1983) version of Sims (1972) test in place of a standard Granger causality test. The two procedures produce similar results, both for small and large samples, and perform remarkably well in detecting non-fundamentalness. Neither methods have anything to do with the problem of aggregation. A “structural aggregate model” does not exist.
Mario Forni
Luca Gambetti
Luca Sala
Non-fundamentalness, Granger causality, aggregation, structural VAR
2018-11
Do female managers help to lower within-firm gender pay gaps? Public institutions vs. private enterprises
http://d.repec.org/n?u=RePEc:ibt:wpaper:wp082018&r=all
We analyse the link between the presence of female managers and the size of the firm-level gender pay gap. We look separately at the private and public sector, basing on a large linked employer-employee dataset for Poland. Using a non-parametric and parametric decompositions, we find that higher presence of female managers is associated with more pay advantage towards women in selected types of public sector units: the ones in which remunerations of women and men are already equal, and a large share of the workforce is tertiary-educated. The effects are, however, relatively small in size. In private establishments, lower gender wage inequality is associated with higher shares of female workers, but not female managers.
Iga Magda
Ewa Cukrowska-Torzewska
gender wage gap, wage inequalities, public sector, female managers, Nopo decomposition, Oaxaca- Blinder decomposition
2018-12
The Effect of College Education on Health and Mortality: Evidence from Canada
http://d.repec.org/n?u=RePEc:lvl:crrecr:1820&r=all
We investigate the returns to college attendance in Canada in terms of health and mortality reduction. To do so, we first use a dynamic health microsimulation model to document how inter-ventions which incentivize college attendance among high school graduates may impact their health trajectory, health care consumption and life expectancy. We find large returns both in terms of longevity (4.1 years additional years at age 51), reduction in the prevalence of various health conditions (10-15 percentage points reduction in diabetes and 5 percentage points for stroke) and health care consumption (27.3% reduction in lifetime hospital stays, 19.7 for specialists). We find that education impacts mortality mostly by delaying the incidence of health conditions as well as providing a survival advantage conditional on having diseases. Second, we provide qua-si-experimental evidence on the impact of college attendance on long- term health outcomes by exploiting the Canadian Veteran's Rehabilitation Act, a program targeted towards returning WW-II veterans and which incentivized college attendance. The impact on mortality are found to be larger than those estimated from the health microsimulation model (hazard ratio of 0.216 com-pared to 0.6 in the simulation model) which suggest substantial returns to college education in terms of healthy life extension which we estimate around one million canadian dollars.
Guy Lacroix
Francois LalibertŽe-Auger
Pierre-Carl Michaud
Daniel Parent
mortality, education, microsimulation, quasi-experimental, instrumental variables, veterans
2018
Der Einfluss strukturierender Eigenschaften von Berufen auf horizontale und vertikale berufliche Mobilität im Kohortenvergleich
http://d.repec.org/n?u=RePEc:iab:iabdpa:201825&r=all
"So far, mobility researchers mainly have explained why workers change occupations by their individual characteristics. But occupations themselves also structure matching processes in the labor market. This paper analyzes the explanatory contribution of occupational characteristics - measured as standardization, licensing and specificity - to horizontal, upward or downward mobility. Against the background of the debate on the 'de-occupationalization' of the labor market, I also examine the change in the influence of these occupational characteristics across four job starter cohorts. With data from the representative dataset 'Working and Learning in a Changing World' (ALWA), I can show that occupational characteristics influence the direction of mobility at least as much as individual factors do. At the same time, there is hardly any change in the influence over time. Consequently, I cannot confirm a decline in the structuring function of occupations as formulated by representatives of the 'de-occupationalization' thesis." (Author's abstract, IAB-Doku) ((en))
Vicari, Basha
2018-12-17
Mental Health, Human Capital and Labor Market Outcomes
http://d.repec.org/n?u=RePEc:duh:wpaper:1704&r=all
There are two primary treatment alternatives available to those with mild to moderate depression or anxiety: psychotherapy and medication. The medical literature and our analysis suggests that in many cases psychotherapy, or a combination of therapy and medication, is more curative than medication alone. However, few individuals choose to use psychotherapy. We develop and estimate a dynamic model in which individuals make sequential medical treatment and labor supply decisions while jointly managing mental health and human capital. The results shed light on the relative importance of several drawbacks to psychotherapy that explain patients' reluctance to use it: (1) therapy has high time costs, which vary with an individual's opportunity cost of time and flexibility of the work schedule; (2) therapy is less standardized than medication, which results in uncertainty about its productivity for a given individual; and (3) therapy is expensive. The estimated model is used to simulate the impacts of counterfactual policies that alter the costs associated with psychotherapy.
Christopher Cronin
Matthew Forsstrom
Nicholas Papageorge
Mental Health, Demand for Medical Care, Labor Supply, Structural Models
Dynamic Panel Modeling of Climate Change
http://d.repec.org/n?u=RePEc:cwl:cwldpp:2151&r=all
Indices of financial returns typically display sample kurtosis that declines towards the Gaussian value 3 as the sampling interval increases. This paper uses stochastic unit root (STUR) and continuous time analysis to explain the phenomenon. Limit theory for the sample kurtosis reveals that STUR specifications provide two sources of excess kurtosis, both of which decline with the sampling interval. Limiting kurtosis is shown to be random and is a functional of the limiting price process. Using a continuous time version of the model under no-drift, local drift, and drift inclusions, we suggest a new continuous time kurtosis measure for financial returns that assists in reconciling these models with the empirical kurtosis characteristics of returns. Simulations are reported and applications to several financial indices demonstrate the usefulness of this approach.
Offer Lieberman
Peter C.B. Phillips
Autoregression, Diffusion, Kurtosis, Stochastic unit root, Time-varying coefficients
2018-06
The Educational and Fertility Effects of Sibling Deaths
http://d.repec.org/n?u=RePEc:duh:wpaper:1801&r=all
An emerging literature finds that childhood exposure to adverse events determines adult outcomes and behavior. We extend this research to understand the influence of witnessing a sibling death as a child on subsequent educational and fertility outcomes in Indonesia. Using panel data and a sibling fixed effects model, we identify this relationship based on variation in the age of surviving children within the same family. Our findings strongly support the importance and persistence of adverse childhood experiences. In particular, for surviving sisters, witnessing a sibling death reduces the years of completed education and the likelihood of completing secondary schooling. The effect on surviving brothers is more muted. A potential channel for this result is that women respond by changing their fertility behavior. While surviving the death of a sibling has little effect on desired fertility levels, we find evidence that surviving sisters start a family about 3-4 years earlier. This suggests that interventions targeted at early-life outcomes may have important ripple effects and that the full impact of health interventions may not be visible until decades afterwards
Dhanushka Thamarapani
Marc Rockmore
Willa Friedman
Child mortality, Siblings, Education, Fertility
Subjective and objective quality reporting and choice of hospital: Evidence from maternal care services in Germany
http://d.repec.org/n?u=RePEc:duh:wpaper:1803&r=all
We study patient choice of healthcare provider based on both objective and subjective quality measures in the context of maternal care hospital services in Germany. Objective measures are obtained from publicly reported clinical indicators, while subjective measures are based on satisfaction scores from a large and nationwide patient survey. We merge both quality metrics to detailed hospital discharge records and quantify the additional distance expectant mothers are willing to travel to give birth in maternity clinics with higher reported quality. Our results reveal that patients are on average willing to travel between 0.7-4.2 additional kilometers for a one standard deviation increase in reported quality. Furthermore, patients respond independently to both objective and subjective quality measures, suggesting that satisfaction scores may constitute important complements to clinical indicators when choosing healthcare provider.
Daniel Avdic
Tugba Büyükdurmus
Giuseppe Moscelli
Adam Pilny
Ieva Sriubaite
hospital competition, hospital choice, maternal care, quality reporting
The Long-term Consequences of the Global 1918 Influenza Pandemic: A Systematic Analysis of 117 IPUMS International Census Data Sets
http://d.repec.org/n?u=RePEc:duh:wpaper:1708&r=all
Several country-level studies, including a prominent one for the United States, have identified long-term effects of in-utero exposure to the 1918 influenza pandemic (also known as the Spanish Flu) on economic outcomes in adulthood. In-utero conditions are theoretically linked to adult health and socioeconomic status through the fetal origins or Barker hypothesis. Historical exposure to the Spanish Flu provides a natural experiment to test this hypothesis. Although the Spanish Flu was a global phenomenon, with around 500 million people infected worldwide, there exists no comprehensive global study on its long-term economic effects. We attempt to close this gap by systematically analyzing 117 Census data sets provided by IPUMS International. We do not find consistent global long-term effects of influenza exposure on education, employment and disability outcomes. A series of robustness checks does not alter this conclusion. Our findings indicate that the existing evidence on long-term economic effects of the Spanish Flu is likely a consequence of publication bias.
Sebastian Vollmer
Juditha Wójcik
Spanish Flu, 1918 Influenza Pandemic, Fetal Origins Hypothesis
Utilisation of personal care services in Scotland: the influence of unpaid carers
http://d.repec.org/n?u=RePEc:duh:wpaper:1802&r=all
Unpaid carers may have an influence on the formal care utilisation of the cared for. Whether this influence is positive or negative will have important implications for the costs of formal care provision. The relationship between unpaid and formal care is of particular importance in Scotland, where personal care is provided for free by Local Authorities, to individuals aged 65+. The existing evidence on the impact of unpaid care on formal care utilisation is extremely mixed, and there is currently no evidence for Scotland. This paper is the first to investigate how the presence of an unpaid carer influences personal care use by those aged 65+ in Scotland, using a unique administrative dataset not previously used in research. Specifically, it uses the Scottish Social Care Survey (SCS) from 2015 and 2016 and compares Ordinary Least Squares (OLS), Generalised Linear Models (GLM), and Two-Part Models (2PM). The results suggest that unpaid care complements personal care services and this finding is robust to a number of sensitivity analyses. This finding may imply that incentivising unpaid care could increase formal care costs, and at the same time it points to the potential for unmet need of those who do not have an unpaid carer. Due to the limitations of the data, future research is necessary.
Elizabeth Lemmon
unpaid, care, informal, formal, substitution, complementary, elderly
Evaluating the Building Blocks of a Dynamically Adaptive Systematic Trading Strategy
http://d.repec.org/n?u=RePEc:arx:papers:1812.02527&r=all
Financial markets change their behaviours abruptly. The mean, variance and correlation patterns of stocks can vary dramatically, triggered by fundamental changes in macroeconomic variables, policies or regulations. A trader needs to adapt her trading style to make the best out of the different phases in the stock markets. Similarly, an investor might want to invest in different asset classes in different market regimes for a stable risk adjusted return profile. Here, we explore the use of State Switching Markov Autoregressive models for identifying and predicting different market regimes loosely modeled on the Wyckoff Price Regimes of accumulation, distribution, advance and decline. We explore the behaviour of various asset classes and market sectors in the identified regimes. We look at the trading strategies like trend following, range trading, retracement trading and breakout trading in the given market regimes and tailor them for the specific regimes. We tie together the best trading strategy and asset allocation for the identified market regimes to come up with a robust dynamically adaptive trading system to outperform simple traditional alphas.
Sonam Srivastava
Ritabratta Bhattacharya
2018-12
On dynamics of wage-price spiral and stagflation in some model economic systems
http://d.repec.org/n?u=RePEc:arx:papers:1812.01707&r=all
This article aims to present an elementary analytical solution to the question of the formation of a structure of differentiation of rates of return in a classical gravitation model and in a model of the dynamics of price-wage spirals.
Afifa Alintissar
Abdelkader Intissar
Jean-karim Intissar
2018-12
Identifying the Effect of Persuasion
http://d.repec.org/n?u=RePEc:arx:papers:1812.02276&r=all
We set up an econometric model of persuasion and study identification of key parameters under various scenarios of data availability. We find that a commonly used measure of persuasion does not estimate the persuasion rate of any population in general. We provide formal identification results, recommend several new parameters to estimate, and discuss their interpretation. Further, we propose efficient estimators of the two central parameters. We revisit two strands of the empirical literature on persuasion to show that the persuasive effect is highly heterogeneous and studies based on binary instruments provide limited information about the average persuasion rate in a heterogeneous population.
Sung Jae Jun
Sokbae Lee
2018-12
Improved Inference on the Rank of a Matrix
http://d.repec.org/n?u=RePEc:arx:papers:1812.02337&r=all
This paper develops a general framework for conducting inference on the rank of an unknown matrix $\Pi_0$. A defining feature of our setup is the null hypothesis of the form $\mathrm H_0: \mathrm{rank}(\Pi_0)\le r$. The problem is of first order importance because the previous literature focuses on $\mathrm H_0': \mathrm{rank}(\Pi_0)= r$ by implicitly assuming away $\mathrm{rank}(\Pi_0)
Qihui Chen
Zheng Fang
2018-12
The Alpha-Heston Stochastic Volatility Model
http://d.repec.org/n?u=RePEc:arx:papers:1812.01914&r=all
We introduce an affine extension of the Heston model where the instantaneous variance process contains a jump part driven by $\alpha$-stable processes with $\alpha\in(1,2]$. In this framework, we examine the implied volatility and its asymptotic behaviors for both asset and variance options. Furthermore, we examine the jump clustering phenomenon observed on the variance market and provide a jump cluster decomposition which allows to analyse the cluster processes.
Ying Jiao
Chunhua Ma
Simone Scotti
Chao Zhou
2018-12
Quantification of market efficiency based on informational-entropy
http://d.repec.org/n?u=RePEc:arx:papers:1812.02371&r=all
Since the 1960s, the question whether markets are efficient or not is controversially discussed. One reason for the difficulty to overcome the controversy is the lack of a universal, but also precise, quantitative definition of efficiency that is able to graduate between different states of efficiency. The main purpose of this article is to fill this gap by developing a measure for the efficiency of markets that fulfill all the stated requirements. It is shown that the new definition of efficiency, based on informational-entropy, is equivalent to the two most used definitions of efficiency from Fama and Jensen. The new measure therefore enables steps to settle the dispute over the state of efficiency in markets. Moreover, it is shown that inefficiency in a market can either arise from the possibility to use information to predict an event with higher than chance level, or can emerge from wrong pricing/ quotes that do not reflect the right probabilities of possible events. Finally, the calculation of efficiency is demonstrated on a simple game (of coin tossing), to show how one could exactly quantify the efficiency in any market-like system, if all probabilities are known.
Roland Rothenstein
2018-12
Annuity Pricing in Public Pension Plans: Importance of Interest Rates
http://d.repec.org/n?u=RePEc:nbr:nberwo:25343&r=all
There is little systematic information on the distribution options in public sector retirement plans and how annuity options are priced relative to the standard single life annuity. This study examines the distribution options of 85 large public retirement plans covering general state employees, teachers, and local government employees. An important component of the analysis is the construction of a data set presenting the annuity options offered by each of these plans and how the monthly benefits for these distribution options are priced. The analysis shows that interest rates used to price annuities vary considerably across the plans. As a result, retirees with the same monthly benefit if a single life benefit is chosen will have substantially different monthly benefits if they select the joint and survivor annuity offered by their retirement plan.
Nino Abashidze
Robert L. Clark
Beth Ritter
David Vanderweide
2018-12
Expectations Uncertainty and Household Economic Behavior
http://d.repec.org/n?u=RePEc:nbr:nberwo:25336&r=all
We show that there exists significant heterogeneity across US households in how uncertain they are in their expectations regarding personal and macroeconomic outcomes, and that uncertainty in expectations predicts households' choices. Individuals with lower income or education, more precarious finances, and living in counties with higher unemployment are more uncertain in their expectations regarding own-income growth, inflation, and national home price changes. People with more uncertain expectations, even accounting for their socioeconomic characteristics, exhibit more precaution in their consumption, credit, and investment behaviors.
Itzhak Ben-David
Elyas Fermand
Camelia M. Kuhnen
Geng Li
2018-12
Regional and Racial Inequality in Infectious Disease Mortality in U.S. Cities, 1900-1948
http://d.repec.org/n?u=RePEc:nbr:nberwo:25345&r=all
In the first half of the twentieth century, the rate of death from infectious disease in the United States fell precipitously. Although this decline is well-known and well-documented, there is surprisingly little evidence about whether it took place uniformly across the regions of the U.S. We use data on infectious disease deaths from all reporting U.S. cities to describe regional patterns in the decline of urban infectious mortality from 1900 to 1948. We report three main results: First, urban infectious mortality was higher in the South in every year from 1900 to 1948. Second, infectious mortality declined later in southern cities than in cities in the other regions. Third, comparatively high infectious mortality in southern cities was driven primarily by extremely high infectious mortality among African Americans. From 1906 to 1920, African Americans in cities experienced a rate of death from infectious disease greater than what urban whites experienced during the 1918 flu pandemic.
James J. Feigenbaum
Christopher Muller
Elizabeth Wrigley-Field
2018-12
Does Remedial Education at Late Childhood Pays Off After All? Long-Run Consequences for University Schooling, Labor Market Outcomes and Inter-Generational Mobility
http://d.repec.org/n?u=RePEc:nbr:nberwo:25332&r=all
We analyze in this paper the long term effect of a high school remedial education program, almost two decades after its implementation. We combine high school records with National Social Security administrative data to examine longer-term outcomes when students were in their early 30s. Our evidence suggest that treated students experienced a 10 percentage points increase in completed years of college schooling, an increase in annual earnings of 4 percentage points, an increase of 1.5 percentage points in months employed, and a significant increase in intergenerational income mobility. These gains are reflecting mainly improvement in outcomes of students from below median income families. Therefore, we conclude that remedial education program that targeted underachieving students in their last year of high school had gains that went much beyond the short term significant improvements in high school matriculation exams. A cost benefit analysis of the program suggests that the government will recover its cost within 7-8 years, implying a very high rate of return to this remedial education program.
Victor Lavy
Assaf Kott
Genia Rachkovski
2018-12
The Heterogeneous Effect of Affirmative Action on Performance
http://d.repec.org/n?u=RePEc:nbr:nberwo:25322&r=all
This paper experimentally investigates the effect of gender-based affirmative action (AA) on performance in the lab, focusing on a tournament environment. The tournament is based on GRE math questions commonly used in graduate school admission, and at which women are known to perform worse on average than men. We find heterogeneous effect of AA on female participants: AA lowers the performance of high-ability women and increases the performance of low-ability women. Our results are consistent with two possible mechanisms—one is that AA changes incentives differentially for low- and high-ability women, and the second is that AA triggers stereotype threat.
Anat Bracha
Alma Cohen
Lynn Conell-Price
2018-12
The Long-run Impact of New Medical Ideas on Cancer Survival and Mortality
http://d.repec.org/n?u=RePEc:nbr:nberwo:25328&r=all
I investigate whether the types of cancer (breast, colon, lung, etc.) subject to greater penetration of new ideas had larger subsequent survival gains and mortality reductions, controlling for changing incidence. I use the MEDLINE/PubMED database, which contains more than 23 million references to journal articles published in 5400 leading biomedical journals, to construct longitudinal measures of the penetration of new medical ideas. The 5-year survival rate is strongly positively related to the novelty of ideas in articles published 12-24 years earlier. This finding is consistent with evidence from case studies that it takes a long time for research evidence to reach clinical practice. The estimates suggest that about 70% of the 1994-2008 increase in the 5-year observed survival rate for all cancer sites combined may have been due to the increase in the novelty of medical ideas 12-24 years earlier. The number of years of potential life lost from cancer before ages 80 and 70 are inversely related to the novelty of ideas in articles published 12-24 years earlier, conditional on incidence. The increase in medical idea novelty was estimated to have caused a 38% decline in the premature (before age 80) cancer mortality rate 12-24 years later.
Frank R. Lichtenberg
2018-12
Energy performance certificates and investments in building energy efficiency: a theoretical analysis
http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2018-11&r=all
In the European Union, Energy Performance Certificates (EPCs) provide potential buyers or tenants with information on a property's energy performance. By mitigating informational asymmetries on real estate markets, the conventional wisdom is that they will reduce energy use, increase energy-efficiency investments, and improve social welfare. We develop a dynamic model that partly contradicts these predictions. Although EPCs always improve social welfare, their impact on energy use and investments is ambiguous. This implies that, in a second-best world where energy externalities are under-priced and/or homeowners have behavioral biases hindering investments (myopia), EPCs can damage social welfare. This calls for using mandatory energy labeling in contexts where additional instruments efficiently mitigate the other imperfections.
Pierre Fleckinger
Matthieu Glachant
Paul-Hervé Tamokoué Kamga
Energy Labeling, Energy Efficiency, Buildings
2018
Long-lasting social capital and its impact on economic development: the legacy of the commons
http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2018-16&r=all
This paper analyzes the historical determinants and long-term persistence of social capital, as well as its effect on economic development, by looking at the legacy of the commons in a Spanish region. In medieval times, common goods were granted to townships and were managed collectively by local citizens. This enabled the establishment of institutions for collective action and self-government. Common goods persisted until the second half of the nineteenth century. We argue that the experience of cooperation among villagers, repeated over the centuries, increased the social capital in each local community. In 1845, a law forced small villages to merge with others, a fact which generated exogenous variation in the number of mergers (i.e., cooperative networks) that each modern municipality was required to have. We exploit this change in an IV and RD setting and find that current municipalities formed by a greater number of old townships have a denser network of associations. We also find that higher social capital is associated with more economic development.
Daniel Montolio
Ana Tur-Prats
Collective Action, Self-Government, Long-Term Persistence, Common Goods
2018
The influence of renewables on electricity price forecasting: a robust approach
http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2018-10&r=all
In this paper a robust approach to modelling electricity spot prices is introduced. Differently from what has been recently done in the literature on electricity price forecasting, where the attention has been mainly drawn by the prediction of spikes, the focus of this contribution is on the robust estimation of nonlinear SETARX models (Self-Exciting Threshold Auto Regressive models with eXogenous regressors). In this way, parameters estimates are not, or very lightly, influenced by the presence of extreme observations and the large majority of prices, which are not spikes, could be better forecasted. A Monte Carlo study is carried out in order to select the best weighting function for Generalized M-estimators of SETAR processes. A robust procedure to select and estimate nonlinear processes for electricity prices is introduced, including robust tests for stationarity and nonlinearity and robust information criteria. The application of the procedure to the Italian electricity market reveals the forecasting superiority of the robust GM-estimator based on the polynomial weighting function respect to the non-robust Least Squares estimator. Finally, the introduction of external regressors in the robust estimation of SETARX processes contributes to the improvement of the forecasting ability of the model.
Luigi Grossi
Fany Nan
Electricity Price, Nonlinear Time Series, Price Forecasting, Robust GM-Estimator, Spikes, Threshold Models
2018
Gender differences under test pressure and their impact on academic performance: a quasi-experimental design
http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2018-21&r=all
Student performance at university is a strong determinant of individual decisions and future outcomes, most notably labour opportunities. Although published studies have found gender differences in student performance in response to pressure, little is known about such differences when university students are exposed to test pressure. Based on field data, this study aims to examine gender differences in student academic performance in response to different levels of pressure when sitting multiple choice tests, a frequently employed exam format at university. To do so, the introduction of continuous assessment in the evaluation system of a university course allows us to exploit a unique quasi-experimental set up in which the same students take similar tests throughout the course but under different levels of pressure. Exploiting two data structures—namely, pooled cross-sections and panel data—we find that male students outperform their female counterparts when under high pressure. However, in low test pressure scenarios the gender gap is narrowed and even reversed in favour of female students. Finally, we analyse the mechanisms responsible for the gender gap by studying how each gender responds to test pressure, and by studying gender differences when omitting test items on multiple choice formats.
Daniel Montolio
Pere A. Taberner
Gender Differences, Test Pressure, Academic Performance, Field Data, Higher Education
2018
The unequal opportunity for skills acquisition during the Great Recession in Europe
http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2018-13&r=all
This paper is the first to investigate the extent to which the high levels of jobless-ness resulting from the Great Recession across Europe have translated into higher school attendance among youth. Using cross-sectional and longitudinal data from the EU-SILC for 28 countries, we establish a robust counter-cyclical relationship between rising unemployment rates and school enrolment. The same is true of transitions back to education. Our analysis by subgroups reveals a worrying trend, with youths who have the most disadvantaged backgrounds (measured by low household income) less likely to enrol in tertiary studies when unemployment rises.
Sara Ayllón
Natalia Nollenberger
Unemployment, School Enrolment, Transitions Back to Education, Youth, Great Recession, EU-SILC
2018
Class composition effects and school welfare: evidence from Portugal using panel data
http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2018-14&r=all
Using student-level longitudinal data of 6th graders I estimate class composition effects impacting on individual academic achievement. The richness of the dataset allows to tackle endogeneity stemming from between and within-school non-random sorting of students and of teachers and other confounding factors through the inclusion of many control covariates that characterize the students’ cumulative process of learning and several fixed effects, namely school, teacher and cohort fixed effects. I find that increasing the percentage of high achievers, in a 6th grade class, has a negative effect on student performance. Larger shares of low-income classmates improve performance for non-low-income students. The shares of male and foreign students yield non or faintly significant results. Using the setup of a particular school, representative of the sample, I also compute improving classrooms’ allocation of students by rearranging the existing students through the existing classes using the estimates of the education production function and different social welfare functions. This way I assess how the actual distribution of students across classes of a given school-grade deviate from what can be considered an improving distribution of classmates. Pareto improving allocations were not found, nevertheless utilitarian welfare functions yield marginally improving allocations.
João Firmino
Class Composition, Peer Effects, Student Achievement, Classroom, Welfare
2018
Thailand; Technical Assistance Report-Government Finance Statistics
http://d.repec.org/n?u=RePEc:imf:imfscr:18/351&r=all
The main purpose of this mission—undertaken with the support of the Government of Japan’s government finance statistics (GFS) project for selected Asian countries—was to improve the quality of the GFS for nonfinancial public corporations (NFPCs) in Thailand by designing a simpler, but more complete, compilation system for the GFS compilers in the Fiscal Policy Office (FPO) of the Ministry of Finance. The mission also discussed some specific general government GFS data compilation issues with the compilers and recommended some actions that would lead to further improvements in data quality as well as consistency with other macroeconomic statistics. In addition, the mission commended the recent momentum gained by the Public Debt Management Office (PDMO) on the reporting of timely, quarterly public sector debt statistics and encouraged them to continue with the regular, quarterly reporting.
International Monetary Fund
2018-12-03
Equilibrium Yield Curve, the Phillips Curve, and Monetary Policy
http://d.repec.org/n?u=RePEc:imf:imfwpa:18/242&r=all
Upward sloping yield curves are hard to reconcile with the positive association between income and inflation (the Phillips curve) in consumption-based asset pricing models. Using US and UK data, this paper shows inflation is negatively correlated with long-run income growth but positively correlated with cyclical income, thus enabling the model to replicate positive and sizable term premiums, along with the Phillips curve over business cycles. Quantitative analyses also emphasize the importance of monetary policy, predicting that a permanently low growth and low inflation environment would precipitate flatter yield curves due to constraints to monetary policy around the zero lower bound.
Mitsuru Katagiri
2018-11-09
Cyprus; 2018 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Cyprus
http://d.repec.org/n?u=RePEc:imf:imfscr:18/337&r=all
Cyprus is recovering strongly from the 2012–13 crisis. GDP growth is projected to remain above 4 percent in 2018–19, buoyed by services and foreign-financed construction. Unemployment is rapidly declining while large fiscal primary surpluses are putting public debt back on a declining path. Nevertheless, crisis legacies continue to weigh on the banking system. In early 2018, difficulties in the Cyprus Cooperative Bank led the authorities to intervene, albeit at a significant fiscal cost. In the process, a package of legislative measures strengthening the insolvency and foreclosure regime was also approved, which is now catalyzing the cleanup of bank balance sheets. These developments have led to a sovereign ratings upgrade, restoring Cyprus’s investment grade status.
International Monetary Fund
2018-12-03
Papua New Guinea; 2018 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Papua New Guinea
http://d.repec.org/n?u=RePEc:imf:imfscr:18/352&r=all
The Papua New Guinea (PNG) economy has grown sluggishly in recent years, reflecting a combination of domestic and external factors. External factors have included adverse terms of trade movements, a drought, and, in 2018, a large earthquake. Domestic factors have included a difficult fiscal consolidation and a shortage of foreign exchange, sustained by an overvalued exchange rate, leading to import compression and weak investment in the non-resource sector. The main macroeconomic challenges for the government are to finish putting in place policies that will help promote economic stability, and to strengthen its long-term development framework. In 2017-18, the new government made important progress in narrowing the fiscal deficit, and adopted a medium-term revenue strategy. But progress on fiscal consolidation has stalled, and the debt-to-GDP ratio is well above the medium-term target. Monetary authorities have begun to facilitate exchange rate adjustment and strengthening of the monetary framework. Stronger economic policies, involving more ambitious fiscal consolidation coupled with faster exchange rate adjustment would yield favorable results.
International Monetary Fund
2018-12-03
Montenegro; Technical Assistance Report-Report on External Sector Statistics Mission
http://d.repec.org/n?u=RePEc:imf:imfscr:18/353&r=all
To support the compilation of external sector statistics (ESS) in Montenegro, the International Monetary Fund (IMF)’s Statistics Department (STA) conducted a technical assistance (TA) mission during December 4–15, 2017. The mission was requested by the Central Bank of Montenegro (CBM), the main ESS compiling agency, and supported by the IMF’s European Department. STA’s mission for the Enhanced General Data Dissemination System (e-GDDS) during June 28-July 4, 2017 also suggested TA for Montenegro to start compiling international investment position (IIP) and external debt statistics (EDS). The mission focused on assisting the CBM in preparing IIP, EDS, Reserves Data Template (RDT), and addressing persistent net errors and omissions. Compilation of IIP and EDS is required to be qualified for Threshold 2 of the e-GDDS. Montenegro does not participate in the Eurosystem, but it is fully eurorized. Euro circulating in Montenegro should be included in the assets of the IIP for Montenegro, but difficulty in estimating the amount had been preventing the CBM from compiling IIP for several years.
International Monetary Fund
2018-12-03
Jamaica; Financial System Stability Assessment
http://d.repec.org/n?u=RePEc:imf:imfscr:18/347&r=all
The macroeconomic environment has improved, reflecting the authorities’ efforts, supported by an IMF arrangement. Previously, years of high fiscal deficits, public enterprise borrowing, and financial sector bailouts led to rapid government debt accumulation, crowded out private credit, increased financial dollarization, and stifled economic growth. Fiscal discipline has been essential to reduce public debt (to about 100 percent of GDP). With government debt accounting for a sizable share of financial institutions’ assets, falling interest rates on government debt are leading to a search for yield. Also, entrenched structural obstacles, including high crime, bureaucratic processes, insufficient labor force skills, and poor access to finance still constrain economic growth. The authorities have made good progress in implementing the 2006 FSAP recommendations. Work on the regulatory framework has significantly advanced in several areas such as securities dealers’ activities, powers to the Bank of Jamaica (BoJ), payment systems, and the introduction of the centralized securities depository. However, the crisis management framework and risk-based supervision work has been lagging.
International Monetary Fund
2018-12-03
Much ado about nothing: A study of differential pricing and liquidity of short and long term bonds
http://d.repec.org/n?u=RePEc:zbw:safewp:238&r=all
Are yields of long-maturity bonds distorted by demand pressure of clientele investors, regulatory effects, or default, flight-to-safety or liquidity premiums? Using data on German nominal bonds between 2005 and 2015, we study the differential pricing and liquidity of short and long maturity bonds. We find statistically significant, but economically negligible segmentation in yields and some degree of liquidity segmentation of short-term versus long-term bonds. These results have important policy implications for the e17.5 trillion European pension and insurance industries: long maturity bond yields seem appropriate for the valuation of long-term liabilities.
Driessen, Joost
Nijman, Theodore E.
Simon, Zorka
Sovereign Bonds,Term Structure of Interest Rates,Segmentation,Liquidity,Flight-to-safety,Credit Risk,Unconventional Monetary Policy
2018
On the estimation of behavioral macroeconomic models via simulated maximum likelihood
http://d.repec.org/n?u=RePEc:zbw:cauewp:201811&r=all
In this paper, we introduce the simulated maximum likelihood method for identifying behavioral heuristics of heterogeneous agents in the baseline three-equation New Keynesian model. The method is extended to multivariate macroeconomic optimization problems, and the estimation pro-cedure is applied to empirical data sets. This approach considerably relaxes restrictive theoretical assumptions and enables a novel estimation of the intensity of choice parameter in discrete choice. In Monte Carlo simulations, we analyze the properties and behavior of the estimation method, which provides important information on the behavioral parameters of the New Keynesian model. However, the curse of dimensionality arises via a consistent downward bias for idiosyncratic shocks. Our empirical results show that the forward-looking version of both the behavioral and the rational model specifications exhibits good performance. We identify potential sources of misspecification for the hybrid version. A novel feature of our analysis is that we pin down the switching parameter for the intensity of choice for the Euro Area and US economy.
Kukacka, Jiri
Jang, Tae-Seok
Sacht, Stephen
Behavioral Heuristics,Intensity of Choice,Monte Carlo Simulations,New-Keynesian Model,Simulated Maximum Likelihood
2018
Macroeconomic dynamics under bounded rationality: On the impact of consumers' forecast heuristics
http://d.repec.org/n?u=RePEc:zbw:cauewp:201810&r=all
In this study, we analyze the macroeconomic dynamics under various shocks in two competing frameworks. Given the baseline New-Keynesian model, we compare the impulse response functions that stem from the hybrid version under rational expectations with the ones obtained in the forward-looking version under bounded rationality. For the latter, we assume heterogeneous agents who may adopt various forecast heuristics. We seek to understand which framework mimics real-world adjustments well and is therefore most suitable to describe economic adjustments over the business cycle.
Jang, Tae-Seok
Sacht, Stephen
Bounded Rationality,Consumer Expectations,Forecast Heuristics,Impulse Response Functions,New-Keynesian Model
2018
A Review on Variable Selection in Regression Analysis
http://d.repec.org/n?u=RePEc:aim:wpaimx:1852&r=all
In this paper, we investigate on 39 Variable Selection procedures to give an overview of the existing literature for practitioners. "Let the data speak for themselves" has become the motto of many applied researchers since the amount of data has significantly grew. Automatic model selection have been raised by the search for data-driven theories for quite a long time now. However while great extensions have been made on the theoretical side still basic procedures are used in most empirical work, eg. Stepwise Regression. Some reviews are already available in the literature for variable selection, but always focus on a specific topic like linear regression, groups of variables or smoothly varying coefficients. Here we provide a review of main methods and state-of-the art extensions as well as a topology of them over a wide range of model structures (linear, grouped, additive, partially linear and non-parametric). We provide explanations for which methods to use for different model purposes and what are key differences among them. We also review two methods for improving variable selection in the general sense.
Loann D. Desboulets
variable selection, automatic modelling, sparse models
2018-05
Forecast heuristics, consumer expectations, and new-Keynesian macroeconomics: A horse race
http://d.repec.org/n?u=RePEc:zbw:cauewp:201809&r=all
This study extends the hybrid version of the baseline New-Keynesian model with heterogeneous agents who may adopt various forecast heuristics. With a focus on consumer expectations, we identify the most appropriate pairs of forecast heuristics that can lead to an equivalent fit to the data compared with the model specification under rational expectations. The competing specifications are estimated using the simulated method of moments. Our empirical results suggest that expectations under bounded rationality in the United States are grounded on consumers' emotional state, while for the Euro Area they are technical in nature. This observation questions the need for a hybrid model specification under rational expectations.
Jang, Tae-Seok
Sacht, Stephen
Consumer Expectations,Forecast Heuristics,New-Keynesian Model,Simulated Method of Moments
2018
Co-movements in Market Prices and Fundamentals: A Semiparametric Multivariate GARCH Approach
http://d.repec.org/n?u=RePEc:aim:wpaimx:1851&r=all
In this paper we investigate on Multivariate GARCH models to assess the co-movements between stock prices of american firms listed on main markets and fundamentals. Co-movements can be seen as correlations. The latter are usually estimated via standard GARCH models such as the Dynamic Conditional Correlation (Engle, 2002) or the Baba-Engle-Kraft-Kroner (Baba et al., 1990). Nevertheless more flexible models such as the Orthogonal GARCH of Alexander (2001) can be used as well. We also introduce a new Semi-parametric Orthogonal GARCH as a natural non-linear extension of the Orthogonal GARCH. A Montecarlo simulation is conducted to evaluate finite sample performance of each model before applying them to the data. Empirical results show evidence that during crises, prices are less correlated with fundamentals that in normal periods.
Loann D. Desboulets
non-parametric, Multivariate GARCH, dynamic correlation, PCA
2017-10
Interpreting sufficiency in fsQCA: A reply to Marques and Salavisa (2017)
http://d.repec.org/n?u=RePEc:pra:mprapa:89890&r=all
Marques and Salavisa (2017) use fuzzy set qualitative comparative analysis (fsQCA) to analyze age-based labour market dualization in Southern European, Anglo-Saxon and a few Nordic countries. They argue that segmentation at the expense of young outsiders is driven by several factors in non-linear ways: different configurations of deindustrialization, labour market coordination, employment protection, and liberalization can lead to youth outsiderness. We question the validity of their empirical analysis and argue that a more complete interpretation of fsQCA measures of fit does not confirm their conclusions. We use the occasion for a hands-on discussion of how the consistency and PRI scores of the sufficiency solution terms are calculated. A good understanding of these allows the researcher to understand which cases and configurations drive high or low scores, and thus facilitates a better understanding of the results.
Flechtner, Svenja
Heinrich, Torsten
fuzzy set qualitative comparative analysis (fsQCA); labour market; unemployment
2017-07-21
Cojumps and Asset Allocation in International Equity Markets
http://d.repec.org/n?u=RePEc:pra:mprapa:89938&r=all
This paper examines the patterns of intraday cojumps between international equity markets as well as their impact on international asset holdings and portfolio diversification benefits. Using intraday index-based data for exchange-traded funds as proxies for international equity markets, we document evidence of significant cojumps, with the intensity increasing during the global financial crisis of 2008-2009. The application of the Hawkes process also shows that jumps propagate from the US and other developed markets to emerg- ing markets. Correlated jumps are found to reduce diversification benefits and foreign asset holdings in minimum risk portfolios, whereas idiosyncratic jumps increase the diversification benefits of international equity portfolios. In contrast, the impact of higher-order moments induced by idiosyncratic and systematic jumps on the optimal composition of international portfolios is not significant.
Arouri, Mohamed El Hedi
M’saddek, Oussama
Nguyen, Duc Khuong
Pukthuanthong, Kuntara
Cojumps; Foreign asset holdings; International diversification.
2017-01
Global Uncertainty, Macroeconomic Activity and Commodity Price
http://d.repec.org/n?u=RePEc:pra:mprapa:90089&r=all
We extend Jurado et al. (2015)’s forecast-error-based uncertainty measure to the international context, and construct a new measure of global uncertainty. We examine dynamic causal effects among global uncertainty and other global macroeconomic variables, and provide two important applications of our global uncertainty measure by linking it to the price formation mechanism of oil and international uncertainty spillover effects. We show that the well-documented relation between uncertainty and real activities is not only a regional issue, but also a global phenomenon. Global uncertainty also plays a key role in determining commodity prices, as well as driving business cycle fluctuations in a certain economy.
Shen, Yifan
Shi, Xunpeng
Zeng, Ting
Global Uncertainty, International Economics, Commodity Price, Oil Price
2017-06-04
Pengaruh Alat Mesin Pertanian Secara Economis Untuk Meningkatkan Efisiensi Pengolahan Tanah Di Djati Gede Sumedang
http://d.repec.org/n?u=RePEc:pra:mprapa:90138&r=all
Abstrack Tractor is one of an agricultural tool commonly used farmers to reverse, break down and friable land. In there were plow in agriculture had been a custom that is done farmers in order to get of the soil quality, both in terms of texture and its structure. The success of development of agricultural mechanization dependent on the condition agroklimat, economic system, and cultural in line with economic opportunities the application of tools and machinery agricultural. The study is done in regional land Sumedang Djati Gede by using the method survey on Tuesday 14 November 2018, while in land management done by means of mechanical use tractor patterned spiral. The results of the study showed that the land mixed with way plowed use tractor produce a state of land very friable so production the farm able to help increase the society economy.
Fadilla, Qori
Sidiqhi, Sigatullah
Rahmadani, Suci
Riskawati, Tina
Listianingrum, Wiwin
Badruzzaman, Zamzam
Keyword: friable, cultivation, and Tractor
2018
Do Individual Investors Ignore Transaction Costs?
http://d.repec.org/n?u=RePEc:pra:mprapa:89941&r=all
Using close to 800,000 transactions by 66,000 households in the United States and close to 2,000,000 transactions by 303,000 households in Finland, this paper shows that individual investors with longer holding periods choose to hold less liquid stocks in their portfolios, consistent with Amihud and Mendelson’s (1986) theory of liquidity clienteles. The relationship between holding periods and transaction costs is stronger among more financially sophisticated households. Households whose holding periods are positively related to transaction costs also earn higher gross returns on their investments before accounting for transaction costs, suggesting that attention to non-salient transaction costs is an indication of investing ability. The main findings are confirmed by analyzing changes in investors’ holding periods around exogenous shocks to stock liquidity. Our findings challenge the notion that individual investors ignore non-salient costs when making investment decisions and suggest that they are cognizant of at least one particular type of non-salient cost, namely the cost of trading stocks, revealing a unique aspect of their rationality.
Anginer, Deniz
Han, Xue Snow
Yildizhan, Celim
individual investors; liquidity; transaction costs; investor attention; behavioral bias
2017-05-19
Debt Crisis in Europe (2001-2015): A Network General Equilibrium GVAR approach
http://d.repec.org/n?u=RePEc:pra:mprapa:89998&r=all
In this work, we investigate the dynamic interdependencies among the EU12 economies using a competitive general equilibrium network system representation. Additionally, using Bayesian techniques, we estimate the autoregressive scheme that characterizes the equilibrium price system of the network, while characterizing each economy/node in the universe of our network in terms of its degree of pervasiveness. In this context, we unveil the dominant(s) unit(s) in our model and estimate the dynamic linkages between the economies/nodes. Lastly, in terms of robustness analysis, we compare the findings of the degree pervasiveness of each economy against other popular quantitative methods in the literature. According to our findings, the economy of Germany acts as weakly dominant entity in the EU12 economy. Meanwhile, all shocks die out in the short run, without any long lasting effect.
Michaelides, Panayotis G.
Tsionas, Efthymios G.
Konstantakis, Konstantinos N.
Bayesian; GVAR; Crisis; Transmission; Debt; EU12
2018
Modeling Returns of Stock Indexes through Fractional Brownian Motion Combined with Jump Processes and Modulated by Markov Chains
http://d.repec.org/n?u=RePEc:pra:mprapa:90549&r=all
We develop a mathematical model useful to describe the stochastic dynamics and return distribution of the stock indexes of world’s main economies (USA, Eurozone, UK and Japan) and of the main emerging markets (China, Brazil, and México) incorporating risk factors as: idiosyncratic volatility, market volatility, and regime-switching volatility. It is assumed that the returns of the stock indexes are driven by fractional Brownian motions combined with Poisson processes and modulated by Markov chains. To do that, we calibrate Jump-GARCH models and estimate Markov regime-switching stochastic volatility models. The proposed models properly describe the stochastic dynamics of the returns of the stock indexes under study during 1994-2017. The main empirical finding is that the USA stock market stays in high volatility most of the time and presents more jumps than other indexes, and that Brazil stock market has the biggest intensity of jumps during 1994-2017. The outcome supports the hypothesis of long-term memory of stock markets. Resumen: Esta investigación desarrolla un modelo matemático útil para describir la dinámica estocástica y la distribución de los rendimientos de los índices bursátiles de las principales economías del mundo (EE.UU. Zona Euro, Reino Unido y Japón) y de los mayores mercados emergentes (China, Brasil y México) mediante la incorporación de factores de riesgo como: volatilidad idiosincrática, volatilidad del mercado y volatilidad de cambio de régimen. Se supone que los rendimientos de los índices bursátiles son conducidos por movimientos fraccionales brownianos combinados con procesos de Poisson y modulados por cadenas de Markov. Para lograr este objetivo se calibran modelos Jump-GARCH y se estiman modelos de volatilidad estocástica de cambio de régimen markoviano. Los modelos propuestos describen adecuadamente la dinámica estocástica de los rendimientos de los índices bursátiles bajo estudio durante 1994-2017. Los principales hallazgos empíricos reflejan que el mercado de capitales de EE.UU. se mantiene en alta volatilidad la mayor parte del tiempo y presenta más saltos que los otros índices y el mercado accionario de Brasil presenta grandes saltos con mayor intensidad. El resultado sostiene la hipótesis de memoria de largo pazo en el mercado de capitales.
Carpinteyro, Martha
Venegas-Martínez, Francisco
Martínez-García, Miguel Ángel
Stock index return, fractional Brownian motion, Markov regime-switching, jump processes.
2018-12-14
Deploying gas power with CCS: The role of operational flexibility, merit order and the future energy system
http://d.repec.org/n?u=RePEc:enp:wpaper:1836&r=all
Matthias Schnellmann
Chi-Kong Chyong
David Reiner
Stuart Scott
2018-11
Pricing in Day-Ahead Electricity Markets with Near-Optimal Unit Commitment
http://d.repec.org/n?u=RePEc:enp:wpaper:1840&r=all
Brent Eldridge
Richard O'Neill
Benjamin Hobbs
2018-11
The U.S. Syndicated Loan Market: Matching Data
http://d.repec.org/n?u=RePEc:fip:fedkrw:rwp18-09&r=all
We introduce a new software package for determining linkages between datasets without common identifiers. We apply these methods to three datasets commonly used in academic research on syndicated lending: Refinitiv LPC DealScan, the Shared National Credit Database, and S&P Global Market Intelligence Compustat. We benchmark the results of our match using results from the literature and previously matched files that are publicly available. We find that the company level matching is enhanced by careful cleaning of the data and considering hierarchical relationships. For loan level matching, a tailored approach based on a good understanding of the data can be better in certain dimensions than a more pure machine learning approach. The R package for the company level match can be found on Github at https://github.com/seunglee98/fedmatch.
Cohen, Gregory J.
Friedrichs, Melanie
Gupta, Kamran
Hayes, William
Lee, Seung Jung
Marsh, W. Blake
Mislang, Nathan
Shaton, Maya
Sicilian, Martin
Bank Credit; Syndicated Loans; Probabilistic Matching; Company Level Matching; Loan Level Matching
2018-12-03
Does financial sector development affect the growth gains from trade opennes?
http://d.repec.org/n?u=RePEc:pra:mprapa:90385&r=all
A sizeable literature suggests that financial sector development could be an important enabler of the growth benefits of trade openness. We provide a comprehensive analysis of how financial development can affect the relationship between trade openness and growth using a dynamic panel threshold model and an extensive dataset for a large sample of countries for the 1970-2015 period. We find that there is a financial development threshold in which trade openness has a positive and significant effect on economic growth. We also find that when splitting the sample into industrialized and non-industrialized countries, the financial development threshold that enables the growth benefits of trade is higher in the former group of countries than in the latter. This finding is consistent with the fact that the export composition of industrialized countries is tilted towards more capital-intensive finance-constrained goods.
Ramírez-Rondán, N. R.
Terrones, Marco E.
Vilchez, Andrea
Trade openness, economic growth, threshold model, panel data.
2018-11
The Optimal Monetary Instrument and the (Mis)Use of Causality Tests
http://d.repec.org/n?u=RePEc:fip:fedkrw:rwp18-11&r=all
This paper uses a New-Keynesian model with multiple monetary assets to show that if the choice of instrument is based solely on its propensity to predict macroeconomic targets, a central bank may choose an inferior policy instrument. We compare a standard interest rate rule to a k-percent rule for three alternative monetary aggregates determined within our model: the monetary base, the simple sum measure of money, and the Divisia measure. Welfare results are striking. While the interest rate dominates the other two monetary aggregate k-percent rules, the Divisia k-percent rule outperforms the interest rate rule. Next we study the ability of Granger Causality tests – in the context of data generated from our model – to correctly identify welfare improving instruments. All of the policy instruments considered, except for Divisia, Granger Cause both output and prices at extremely high levels of significance. Divisia fails to Granger Cause prices despite the Divisia rule stabilizing inflation better than these alternative policy instruments. The causality results are robust to using a popular version of the Sims Causality test for which we show standard asymptotics remain valid when the variables are integrated, as in our case.
Keating, John W.
Smith, Andrew Lee
Monetary Policy Instrument; Monetary Aggregates; Granger Causality
2018-11-28
2017 Methods-of-Payment Survey Report
http://d.repec.org/n?u=RePEc:bca:bocadp:18-17&r=all
As the sole issuer of bank notes, the Bank of Canada conducts Methods-of-Payment (MOP) surveys to obtain a detailed and representative snapshot of Canadian payment choices, with a focus on cash usage. The 2017 MOP Survey is the third iteration. This paper finds that the overall cash volume and value shares are 33 per cent and 15 per cent, respectively. These results highlight the ongoing decrease of cash usage in terms of volume and value compared with 2009 (54 per cent and 23 per cent, respectively) and 2013 (44 per cent and 23 per cent, respectively). Consumers still rate cash as an easy-to-use, low-cost, secure and widely accepted payment method, and it is commonly used among respondents who are aged 55 and above, have an income of less than $45,000, have only a high school education, or have a low rate of financial literacy. The paper also provides comprehensive details on Canadians’ adoption and use of payment innovations such as contactless credit and debit cards, as well as mobile and online payments.
Christopher Henry
Kim Huynh
Angelika Welte
Bank notes, Digital Currencies, Financial services
2018
Is ECB monetary policy more powerful during expansions?
http://d.repec.org/n?u=RePEc:bdi:wptemi:td_1202_18&r=all
This paper tests whether the effects of ECB monetary policy vary over different phases of the business cycle. It uses local projections to estimate the state-dependent impulse responses of economic activity and prices to monetary policy shocks. These are identified through high-frequency financial market responses after Governing Council meetings. While the impact of monetary policy on economic activity is roughly similar during recessions and expansions, prices respond more strongly during booms. The result holds when the state of the economy is based on measures of resource utilization, rather than on GDP growth rates. Nominal wages also respond more strongly to monetary policy during expansions and when there is no slack in the economy. The empirical findings are consistent with the presence of downward rigidity on nominal wages.
Martina Cecioni
monetary policy, business cycle
2018-12
The Role of Corporate Saving over the Business Cycle: Shock Absorber or Amplifier?
http://d.repec.org/n?u=RePEc:bca:bocawp:18-59&r=all
We document countercyclical corporate saving behavior with the degree of countercyclicality varying nonmonotonically with firm size. We then develop a dynamic stochastic general equilibrium model with heterogeneous firms to explain the pattern and study its implications for business cycles. In the presence of financial frictions and fixed operating costs, a persistent negative productivity shock signals low future income and prompts firms to hold more cash in order to preserve financial flexibility and maintain normal operations. This countercyclicality exhibits a hump-shaped relation to firm size. Compared with mediumsized firms, small firms have a higher marginal product of capital and thus better investment opportunities, which compete for resources with cash, while large firms have more pledgeable assets and demand less cash. We find that, on average, firms accumulate cash by cutting investment and employment in recessions, which reduces aggregate output and increases economic fluctuations. Corporate saving, therefore, amplifies aggregate shocks.
Xiaodan Gao
Shaofeng Xu
Business fluctuations and cycles, Economic models
2018
La pobreza en Riohacha: diagnóstico, análisis y propuestas
http://d.repec.org/n?u=RePEc:col:000102:017025&r=all
El objetivo número uno de desarrollo sostenible de las Naciones Unidas dicta que para el año 2030 se debe erradicar la pobreza en todas sus formas y dimensiones en todo el mundo. Colombia ha realizado avances en esta línea y las cifras muestran que entre 2010 y 2017 la pobreza monetaria se redujo al pasar del 37,2% al 26,9%. Sin embargo, aún existen rezagos en esta materia y prueba de ello es Riohacha, ciudad que mantuvo constante su incidencia en 46,9% para este periodo de tiempo. El presente artículo realiza un diagnóstico detallado de la pobreza en la capital de La Guajira y presenta las inversiones necesarias para avanzar en su superación. Los principales indicadores revelan que el empleo informal, el bajo logro educativo y la falta de acceso a servicios básicos son las privaciones con mayor recurrencia en los hogares. Además, estas se concentran en la periferia y la zona rural dispersa, en donde coinciden con un alto porcentaje de población indígena. A partir de los resultados, se propone una intervención integral en cuatro sectores: educación, empleo, vivienda y servicios públicos, cuyo costo total se estima en 372,7 millones de dólares para el periodo comprendido entre 2019 y 2030. **** ABSTRACT: The number one sustainable development goal of the United Nations establishes that, by 2030, poverty should end in all its forms everywhere in the world. Colombia has made progress in this area: between 2010 and 2017, monetary poverty in the country fell from 37.2% to 26.9%. However, there are still challenges to overcome, and proof of this is Riohacha, a city that maintained poverty rate constant at 46.9% during this period. The main objective of this document is to present a detailed study of poverty in Riohacha and the necessary investments to advance in its solution. The main indicators reveal that informal employment, low educational attainment, and lack of access to basic services, are the most recurrent deprivations in households. In addition, these are concentrated in the periphery and the dispersed rural area, where there is also a large percentage of indigenous population. Based on the results, an intervention is proposed in four sectors: education, employment, housing, and public services. The total cost of the proposal is estimated at 372.7 million dollars for the period between 2019 and 2030.
Diana Ricciulli-Marín
César Arismendi
Eduardo Romero
Riohacha, pobreza, políticas públicas, poverty, public policy
2018-12-14
Should the Central Bank Issue E-money?
http://d.repec.org/n?u=RePEc:bca:bocawp:18-58&r=all
Should a central bank take over the provision of e-money, a circulable electronic liability? We discuss how e-money technology changes the tradeoff between public and private provision, and the tradeoff between e-money and a central bank's existing liabilities like bank notes and reserves. The tradeoffs depend on i) the technological setup of the e-money system (as a token or an account; centralized or decentralized); ii) the potential improvement in the implementation and transmission of monetary policy; iii) the risks to safety and privacy from cyber attacks; and iv) the uncertain impact on banks’ efficiency and financial stability. The most compelling argument for central banks to issue e-money is to address competition problems in the banking sector.
Charles M. Kahn
Francisco Rivadeneyra
Tsz-Nga Wong
Bank notes, Digital Currencies, Financial services, Payment clearing and settlement systems
2018
Recent trends in economic activity and TFP in Italy with a focus on embodied technical progress
http://d.repec.org/n?u=RePEc:bdi:wptemi:td_1204_18&r=all
In this paper we provide fresh evidence on TFP performance in the Italian economy since 1995, taking into account the changing composition of primary inputs across different capital goods and employment skills, as well as technical progress embodied in different vintages of the productive assets. We first estimate a technical depreciation rate by using individual data on Italian industrial firms. We then obtain an experimental measure of the capital stock adjusted for technical efficiency, by augmenting the standard depreciation rate by our own estimate of technical depreciation (about 5 per cent per year). Once we introduce our measure of capital stock in a standard growth accounting exercise, we find a less dismal performance of the Italian TFP than usually estimated. Focusing on the years between 2007 and 2016, the upward correction in TFP amounts to around 1.5 percentage points in the overall period for the total economy and to about 2.5 percentage points when only considering manufacturing. These findings shed a somewhat more positive light on future TFP developments in Italy, suggesting a more rapid increase of potential output than otherwise estimated. In addition, the efficiency of installed capital might soon return to growth, as the expected recovery of investment results in the replacement of old vintages with new and more technically advanced ones.
Alessandro Mistretta
Francesco Zollino
TFP, technical progress, embodied technology
2018-12
Gender, Social Value Orientation, and Tax Compliance
http://d.repec.org/n?u=RePEc:ces:ceswps:_7372&r=all
This paper brings an important empirical contribution to the academic literature by examining whether gender differences in tax compliance are due to higher prosociality among women. We conducted a large cross-national tax compliance experiment carried out in Italy, U.K., U.S., Sweden, and Romania, and assessed tax compliance as reported income as a percentage of total earned income in the experiment. We uncover that women declare a significantly higher percentage of their income than men in all five countries. While some scholars have argued that differences in honesty between men and women is actually being mediated by the fact that women are more prosocial than men, we find that women are not more prosocial than men in all countries. Furthermore, though overall women tend to be more prosocial on average than men, SVO has no mediation effect between gender and tax compliance. We conclude then that although differences in prosociality between men and women seem to be context dependent, differences in tax compliance are indeed much more consistent.
John D'Attoma
Clara Volintiru
Antoine Malezieux
behavioral economics, tax compliance, gender
2018
Richer or more Numerous or both? The Role of Population and Economic Growth for Top Income Shares
http://d.repec.org/n?u=RePEc:ces:ceswps:_7385&r=all
When measuring income inequality over long periods of time, accounting for population and productivity growth is important. This paper presents three alternative measures of top income shares that more explicitly account for population and income growth than the standard measure. We apply these measures to long-term income data from the United States and find that the U-shaped inequality trend over the past century holds up, but with important qualifications. Using measures that allow top groups to change not only in relative income but also in group size suggest more accentuated top income share growth since 1980 than when keeping top groups fixed. For earlier historical periods, our analysis shows that choice of income deflator (CPI or GDP) matters greatly. Using distributional national accounts data does not change these results. Altogether, our study's findings suggest that one may want to use several complementary top share measures when assessing long-term income inequality trends.
Carla Krolage
Andreas Peichl
Daniel Waldenström
income distribution, inequality, top incomes, growth, measurement
2018
Pareto-Improving Structural Reforms
http://d.repec.org/n?u=RePEc:ces:ceswps:_7387&r=all
Economists recommend to partly redistribute gains to losers from a structural reform, which in many cases may be required for making the reform politically viable. However, taxation is distortionary. Then, it is unclear that compensatory transfers can support a Pareto-improving reform. This paper provides sufficient conditions for this to occur, despite tax distortions. I consider an economy where workers have sector-specific skills and some sectors are regulated by a price .floor. Transfers have to be financed by proportional taxation on firm’s revenues or, equivalently, labor income. Labor supply is elastic to net post-tax real wages, and hence reduced by taxation. In a setting where preferences are isoelastic, deregulation is implementable in a Pareto-improving way through compensatory lump-sum transfers, despite that these are financed by distortionary taxes. In a more general setting, there always exist Pareto-improving reforms but they may involved tightening regulation for some goods. I provide sufficient conditions for deregulation, i.e. a general reduction in price floors, to be Pareto-improving. They imply that demand cross-price elasticities should not be too large and that the reform should not be too unbalanced. Finally, I consider counter-examples where some people earn rents associated with informational or institutional frictions. In such situations, Pareto improvements are unlikely. If losers have veto power, the reform may only be supported by a minority of people. Broadening reform scope is especially useful to raise its political support when its impact is uneven across consumers.
Gilles Saint-Paul
structural reform, deregulation, price controls, Pareto optimality, rent seeking, taxation, compensatory transfers
2018
The Propagation of Monetary Policy Shocks in a Heterogeneous Production Economy
http://d.repec.org/n?u=RePEc:ces:ceswps:_7376&r=all
We study the transmission of monetary policy shocks in a model in which realistic heterogeneity in price rigidity interacts with heterogeneity in sectoral size and input-output linkages, and derive conditions under which these heterogeneities generate large real effects. Empirically, heterogeneity in the frequency of price adjustment is the most important driver behind large real effects, whereas heterogeneity in input-output linkages contributes only marginally, with differences in consumption shares in between. Heterogeneity in price rigidity further is key in determining which sectors are the most important contributors to the transmission of monetary shocks, and is necessary but not sufficient to generate realistic output correlations. In the model and data, reducing the number of sectors decreases monetary non-neutrality with a similar impact response of inflation. Hence, the initial response of inflation to monetary shocks is not sufficient to discriminate across models and for the real effects of nominal shocks.
Ernesto Pasten
Raphael S. Schoenle
Michael Weber
input-output linkages, multi-sector, Calvo model, monetary policy
2018
Who is NOT Voting for Brexit Anymore?
http://d.repec.org/n?u=RePEc:ces:ceswps:_7389&r=all
Using estimates of support for Leave across UK local authority areas constructed from a comprehensive 20,000 strong survey, we show that both the level and the geographic variation capturing differential degrees of support for Leave have changed significantly since the 2016 EU referendum. A lot of area characteristics, many of which were previously associated with higher levels of support for Leave, are now significant correlates capturing a swing towards Remain. They include, for example, the degree to which local authorities receive transfers from the EU or the extent to which their economies rely on trade with the EU, along with past electoral support for UKIP (and the BNP) and exposure to immigration from Eastern Europe. Lastly, exposure to austerity since 2010 is among the strongest individual correlates weakening the support for Leave. The evidence is consistent with the argument that the small margin of victory of Leave in 2016 was, to a significant extent, carried by protest voters, who used the EU referendum to voice their discontent with domestic social and economic developments, particularly, austerity. Lastly, we present some evidence suggesting that the UK public, even in Leave supporting areas, would be much more willing to make compromises on free movement and aspects of single market membership compared to what appears to be the UK governments negotiation objective.
Eleonora Alabrese
Thiemo Fetzer
Brexit, protest voting, globalization, European Union
2018
How does information disclosure affect liquidity?Evidence from an Emerging Market
http://d.repec.org/n?u=RePEc:col:000122:016990&r=all
Ignacio Arango
Diego A. Agudelo
2017-12-30
Occasional Bulletin of Economic Notes 2018/02- Living with structural current account deficits- Foreign lessons for SA?
http://d.repec.org/n?u=RePEc:rbz:oboens:8870&r=all
Jean-François Mercier
2018-11-05
Occasional Bulletin of Economic Notes 2017/03- Comparing the SARB’s Quarterly Projection Model to the “Core”macro-econometric model
http://d.repec.org/n?u=RePEc:rbz:oboens:8903&r=all
Macro Models Unit
Policy Development Wing
2017-01-18
Occasional Bulletin of Economic Notes 2017/03- Getting to the core of it
http://d.repec.org/n?u=RePEc:rbz:oboens:8901&r=all
Theo Janse van Rensburg
Theresa Alton
2017-01-16
Occasional Bulletin of Economic Notes 2017/03- Decoupling from global growth – Is confidence becoming a scarce commodity?
http://d.repec.org/n?u=RePEc:rbz:oboens:8902&r=all
Theo Janse van Rensburg
Erik Visser
2017-01-17
Occasional Bulletin of Economic Notes 2018/02- Inflation expectations and the outlook for services prices
http://d.repec.org/n?u=RePEc:rbz:oboens:8871&r=all
David Fowkes
Theo Janse van Rensburg
Theresa Alton
2018-11-05
Occasional Bulletin of Economic Notes 2018/01- Is our core rotten?
http://d.repec.org/n?u=RePEc:rbz:oboens:8885&r=all
Franz Ruch
2018-11-06
Size matters: Estimation sample length and electricity price forecasting accuracy
http://d.repec.org/n?u=RePEc:trn:utwprg:2018/10&r=all
Electricity price forecasting models are typically estimated via rolling windows, i.e. by using only the most recent observations. Nonetheless, the current literature does not provide much guidance on how to select the size of such windows. This paper shows that determining the appropriate window prior to estimation dramatically improves forecasting performances. In addition, it proposes a simple two-step approach to choose the best performing models and window sizes. The value of this methodology is illustrated by analyzing hourly datasets from two large power markets with a selection of ten different forecasting models. Incidentally, our empirical application reveals that simple models, such as the linear regression, can perform surprisingly well if estimated on extremely short samples.
Carlo Fezzi
Luca Mosetti
electricity price forecasting, day-ahead market, parameter instability, bandwidth selection, artificial neural networks
2018
Globalization and Electoral Outcomes: Evidence from Italy
http://d.repec.org/n?u=RePEc:trn:utwprg:2018/07&r=all
We study whether and to what extent the electoral dynamics in Italy over the 1994-2008 period can be explained by the development of economic factors associ- ated with globalization. To measure the level of exposure to globalization for local labor markets, our main unit of analysis, we use the intensity of import compe- tition from China and the presence of immigrants. Looking at parties’ political positions and employing an estimation strategy that accounts for endogeneity and time-invariant unobserved e↵ects across local labor markets, we find that both immigration intensity and exposure to import competition from China have con- tributed positively to the electoral outcomes of far-right parties, whereas only the former has produced a positive e↵ect on the votes of right-wing and traditional- ist/authoritarian/nationalist parties. On the other hand, neither of them has had an e↵ect on far-left parties. Moreover, electoral turnout has responded negatively to an increased presence of migrants. While the above e↵ects seem to work through the mediation of labor markets, the results suggest that other mechanisms at the level of local communities are also at play.
Mauro Caselli
Andrea Fracasso
Silvio Traverso
voting, electoral outcomes, trade, import competition, immigration, local labor markets
2018
Classifying Firms with Text Mining
http://d.repec.org/n?u=RePEc:trn:utwprg:2018/09&r=all
Statistics on the births, deaths and survival rates of firms are crucial pieces of information, as they enter as an input in the computation of GDP, the identification of each sector’s contribution to the economy, and the assessment of gross job creation and destruction rates. Official statistics on firm demography are made available only several months after data collection and storage, however. Furthermore, unprocessed and untimely administrative data can lead to a misrepresentation of the life-cycle stage of a firm. In this paper we implement an automated version of Eurostat’s algorithm aimed at distinguishing true startup endeavors from the resurrection of pre-existing but apparently defunct firms. The potential gains from combining machine learning, natural language processing and econometric tools for pre- processing and analyzing granular data are exposed, and a machine learning method predicting reactivations of deceptively dead firms is proposed.
Giacomo Caterini
Business Demography; Classification; Text Mining
2018
Evaluation of the Comprehensive Primary Care Initiative Fourth Annual Report Appendix
http://d.repec.org/n?u=RePEc:mpr:mprres:a92d970cf2b24f59aadcffd69fa2153f&r=all
This is the appendix to the fourth and final report evaluating the four-year Comprehensive Primary Care (CPC) initiative, which was launched by the Center for Medicare & Medicaid Innovation (CMMI) of the Centers for Medicare & Medicaid Services (CMS) to improve primary care delivery, health care quality, and patient experience, and lower costs.
Deborah Peikes
Grace Anglin
Stacy Dale
Erin Fries Taylor
Ann O'Malley
Arkadipta Ghosh
Kaylyn Swankoski
Jesse Crosson
Rosalind Keith
Anne Mutti
Sheila Hoag
Pragya Singh
Ha Tu
Thomas Grannemann
Mariel Finucane
Aparajita Zutshi
Lauren Vollmer
Randall Brown
primary care, Comprehensive Primary Care initiative, primary care transformation, patient-centered medical home
Estimating the wrapped stable distribution via indirect inference
http://d.repec.org/n?u=RePEc:trn:utwprg:2018/11&r=all
The wrapped stable distribution is a model for non-symmetric circular data. Maximum likelihood estimation is feasible, but computationally expensive and not exact, because the density does not exist in closed form. In light of these difficulties, we develop a constrained indirect inference approach based on a skewed-t auxiliary model. To improve the finite-sample properties of the estimators, we devise a bootstrap-based estimate of the weighting matrix employed in the indirect inference program. The simulation study suggests that the indirect inference estimators are definitely preferable to the maximum likelihood estimators as concerns computing time, and approximately equivalent in terms of root-mean-squared-error.
Marco Bee
Indirect inference; directional statistics; stable distribution; weighting matrix
2018
Estimating Value-at-Risk for the g-and-h distribution: an indirect inference approach.
http://d.repec.org/n?u=RePEc:trn:utwprg:2018/08&r=all
TThe g-and-h distribution is a flexible model with desirable theoretical properties. Especially, it is able to handle well the complex behavior of loss data and it is suitable for VaR estimation when large skewness and kurtosis are at stake. However, parameter estimation is di cult, because the density cannot be written in closed form. In this paper we develop an indirect inference method using the skewed- t distribution as instrumental model. We show that the skewed-t is a well suited auxiliary model and study the numerical issues related to its implementation. A Monte Carlo analysis and an application to operational losses suggest that the indirect inference estimators of the parameters and of the VaR outperform the quantile-based estimators.
Marco Bee
Julien Hambuckers
Luca Trapin
Value-at-Risk; g-and-h distribution; loss model; indirect infer- ence; simulation; intractable likelihood
2018
Child Malnutrition in India
http://d.repec.org/n?u=RePEc:pra:mprapa:90550&r=all
This chapter examines child malnutrition in India. Even though the incidence of malnutrition in India has declined greatly since Independence, the prevalence of malnutrition in India remains extremely high, even relative to other poor countries. It is, however, difficult to arrive at a universally acceptable explanation for why this should be so. The contribution of this chapter is to examine the relative strengths of the determinants of child malnutrition in India, paying attention to household characteristics (social group, consumption level, education, location) and the characteristics of the households’ dwellings (presence of toilets, separate kitchen, vent in the cooking area). The analysis also examines the importance of anganwadis in combating child malnutrition through growth monitoring, health checks, and the provision of supplementary food. In addition, a unique characteristic of this chapter is that it draws attention to the importance of personal hygiene, through washing hands with soap and water after defecation, as a prophylactic against diarrhoeal disease.
Borooah, Vani
Children, malnutrition, India, social groups
2018-05
The Social Orientation of India’s Integrated Child Development Services (ICDS) Program
http://d.repec.org/n?u=RePEc:pra:mprapa:90421&r=all
Launched in October 1975, India’s Integrated Child Development Services (ICDS) program is its largest national program for promoting the health and development of mothers and their children. This chapter examines an aspect of the ICDS program that has been neglected, namely who are its beneficiaries? Are they persons from deprived groups who, but for the program, might not have received such services? Or are they persons from more privileged groups who have the resources to acquire them from other sources? In both cases the ICDS program adds value but, in the latter situation, it does so by displacing existing services. This evaluation of the ICDS program is particularly important in the light of the Government of India’s view, as articulated in its Eleventh Five Year Plan, that growth is not perceived as “sufficiently inclusive for many groups, especially Scheduled Castes, Scheduled Tribes, and Minorities”. The chapter presents econometric estimates regarding the relative strength of the personal and household circumstances of persons in determining the likelihood of utilising ICDS services. Lastly, the chapter suggests a trade-off between quality and utilisation by hypothesising that the poor quality of services leads upper-caste mothers to exit the ICDS market and seek these services elsewhere.
Borooah, Vani
Child Development, Social Groups, Exit, Voice
2018-05
The Health of Elderly Persons in India
http://d.repec.org/n?u=RePEc:pra:mprapa:90551&r=all
This chapter uses data from India’s National Sample Survey (NSS), relating to respondents’ health outcomes between January and June 2014, to quantify a particular form of gender inequality: inequality in self-rated health (SRH) outcomes between men and women aged 60 years or over. In so doing, it makes five contributions to the existing literature. The first is in terms of analytical technique: this study contains a more detailed and nuanced exposition of the regression results than in previous studies. Second, it controls for environmental factors — such as poor drainage, absence of toilets, or lack of ventilation in the kitchen — which might adversely impact on health and, in particular, affect the health of women more than that of men. Third, it takes account of interaction effects by which the effect of a variable on an elderly person’s SRH differed according to whether the person was male or female. Lastly, it examines whether SRH is correlated with objective health outcomes. In particular, this study answers two central questions. Did men and women, considered collectively, have significantly different likelihoods of ‘poor’ SRH between the different regions/income classes/social groups/education levels? Did men and women, considered separately, have significantly different likelihoods of a ‘poor’ SRH within a region/income class/social group/education level?
Borooah, Vani
Gender, Elderly, India, Disparity, Health Outcomes
2018-05
Inequality and Well-Being
http://d.repec.org/n?u=RePEc:pra:mprapa:90554&r=all
This chapter investigates a neglected area in the study of human development relating differences in human development between social groups in a country. Failure to take account of such inter-group inequalities might lead one to exaggerate a country’s developmental achievements. Conversely, one would get a more accurate picture of a country’s achievements with respect to human development only after one had taken cognisance of the fact that the fruits of development were unequally distributed between its various communities. There is a further issue. Not only are developmental fruits unequally distributed between groups, but these fruits may be unequally distributed within the groups. This chapter uses the methodology of “equity adjusted achievement” to compute human development indices and “extended” human development indices for a number of social groups in India.
Borooah, Vani
Inequality, Well Being, Social Groups
2018-05
Credit Risk and Fiscal Inflation
http://d.repec.org/n?u=RePEc:pra:mprapa:90486&r=all
Is inflation ‘always and everywhere a monetary phenomenon’ or is it fundamentally a fiscal phenomenon? This article augments a standard monetary model to incorporate fiscal details and credit market frictions. These ingredients allow for both interpretations of the inflation process in a financially constrained environment. We find that adding financial frictions to the model generates important identifying restrictions on the observed pattern between inflation and measures of financial and fiscal stress, to the extent that it can overturn existing findings about which monetary-fiscal policy regime produced the pre-crisis U.S. data.
Li, Bing
Pei, Pei
Tan, Fei
monetary and fiscal policy, financial frictions, marginal likelihood
2018-04-03
Deaths in the Family
http://d.repec.org/n?u=RePEc:pra:mprapa:90553&r=all
The purpose of this chapter is to evaluate the relative strengths of economic and social status in determining deaths in households in India. The first part of the chapter focuses on the “age at death” using National Sample Survey data for 2004 and 2014. The purpose was to ask whether after controlling for non-community factors, the fact that Indians belonged to different social groups, encapsulating different degrees of social status, exercised a significant influence on their age at death? The existence of a social group effect would suggest that there was a “social gradient” to health outcomes in India. The second part of the chapter, using data from the Indian Human Development Survey of 2011, investigated the determinants of infant and child mortality. The overriding concern now is gender bias with girls more likely to die than boys before attaining their first (infant) and fifth (child) birthdays. As this study has shown, gender bias in infant and child mortality rates is, with singular exceptions, a feature of all the social groups. In conducting this investigation, the chapter addresses for India an issue which lies at the heart of social epidemiology: estimating the relative strengths of individual and social factors in determining mortality outcomes.
Borooah, Vani
Deaths, Family, Caste, Religion
2018-05