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on Computational Economics |
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Issue of 2006‒10‒28
three papers chosen by |
| By: | Slade, Margaret E. (Department of Economics, University of Warwick) |
| Abstract: | I discuss the use of simulation techniques to evaluate unilateral effects of horizontal mergers and the pitfalls that one can encounter when using them. Simple econometric models are desirable because they can be implemented in a short period of time and can be understood by non experts. Unfortunately, their predictions are often misleading. Complex models are more reliable but they require more time to implement and are less transparent. The use of merger simulations and the sensitivity of predictions to modeling choices is illustrated with an application to mergers in the UK brewing industry. There have been a number of brewing mergers that have changed the structure of the UK market, as well as proposed but unconsummated mergers that would have had even more profound effects. I assess two of them: the successful merger between Scottish&Newcastle and Courage and the proposed merger between Bass and Carlsberg–Tetley. |
| Keywords: | Unilateral effects, horizontal merger simulations, UK brewing |
| JEL: | L13 L41 L66 L81 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:warwec:767&r=cmp |
| By: | C. Katharina Spiess (DIW Berlin and FU Berlin); Katharina Wrohlich (DIW Berlin and IZA Bonn) |
| Abstract: | Germany is known to have one of the lowest fertility rates among Western European countries and also relatively low employment rates of mothers with young children. Although these trends have been observed during the last decades, the German public has only recently begun discussing these issues. In order to reverse these trends, the German government recently passed a reform of the parental leave benefit system in line with the Scandinavian model. The core piece of the reform is the replacement of the existing meanstested parental leave benefit by a wage-dependent benefit for the period of one year. In this paper we simulate fiscal costs and expected labour market outcomes of this reform. Based on a micro-simulation model for Germany we calculate first-round effects, which assume no behavioural changes and second-round effects, where we take labour supply changes into account. Our results show that on average all income groups, couples and single households, benefit from the reform. The calculation of overall costs of the reform shows that the additional costs are moderate. As far as the labour market behaviour of parents is concerned, we find no significant changes of labour market outcomes in the first year after birth. However, in the second year, mothers increase their working hours and labour market participation significantly. Our results suggest that the reform will achieve one of its aims, namely the increase in the labour market participation of mothers with young children. |
| Keywords: | female labour supply, parental leave, micro simulation study |
| JEL: | J22 H31 I38 |
| Date: | 2006–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2372&r=cmp |
| By: | Li,Youwei; Donkers,Bas; Melenberg,Bertrand (Tilburg University, Center for Economic Research) |
| Abstract: | This paper illustrates how to compare different microscopic simulation (MS) models and how to compare a MS model with real data in case the parameters of interest are estimated non- or semiparametrically. As examples we investigate the marginal single-period probability density function of stock returns, and the corresponding spectral density function and memory parameters. We illustrate the methodology by the MS models developed by Levy, Levy, Solomon (2000) and the market fraction model developed by He and Li (2005a, b), and confront the resulting return data with the S&P 500 stock index data. |
| Keywords: | Microscopic simulation models;Probability density function;Spectral density function;Memory parameters |
| JEL: | C14 G12 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:200695&r=cmp |