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on Central and Western Asia |
| By: | Maxfield, Sean Alexander |
| Abstract: | No longer does society consider the full extent of the argument and consequences or benefits of a system change. All the record-breaking economic success of the last few decades simply furthers a divide between people/organizations that have money and people/organizations that need money. However, those that can view this divide assign the capitalistic system as the culprit when in fact it is the modern mutation of capitalism that is at fault. Within modern neoclassical economies, there is no form of value-based meritocracy between people and organizations. |
| Date: | 2021–12–18 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:j9sgq&r= |
| By: | Yusuf Emre Akgündüz (Yusuf Emre Akgündüz); Yusuf Kenan Bağır (Yusuf Kenan Bağır); Seyit Mümin Cılasun (Seyit Mümin Cılasun); Murat Güray Kırdar (Murat Güray Kırdar) |
| Abstract: | This study combines an administrative dataset of the full population of Turkish firms and the setting of the sudden mass migration of Syrian refugees to Turkey to identify the effect of migrants on firm performance and market structure. We find that economic activity increases in hosting regions, but negative implications exist for long-term productivity. As a result of the migrant shock, exiting firms expand and new firms are established; however, the resulting market structure shows less concentration. Quantitatively, a 10 percentage-point rise in the migrant-to-native ratio increases firm sales by 3.8% and the number of active firms by 5.8%, but reduces firms’ average market share by 4.1%. We further document an increase in the export volume and variety of exported products to the Middle East and North Africa (MENA) region. In addition, a decline in export prices is observed, implying a rise in the competitiveness of exporting firms. We also uncover evidence for an effect of migrants’ skills and networks on exports, as the export value and variety of products to the MENA region increase more than those to the EU region while the prices of products exported to the two regions show similar changes. |
| Keywords: | refugees, firm performance, market structure, sales, informality, exports, migrant business networks. |
| JEL: | J15 J61 F16 L11 |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:2203&r= |
| By: | Nikolov, Plamen (State University of New York) |
| Abstract: | This document summarizes various tips for economics research papers. |
| Keywords: | writing tips, economics, research papers, research studies |
| JEL: | A30 A39 |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15057&r= |
| By: | Ferreira, Miguel A.; Eça, Afonso; Prado, Melissa Porras; Rizzo, A. Emanuele |
| Abstract: | We show that FinTech lending affects credit markets and real economic activity using a unique data set of a Peer-to-Business platform for which we have the universe of loan applications. We find that FinTech serves high quality and creditworthy small businesses who already have access to bank credit. Firms use FinTech to obtain long-term unsecured loans and reduce their exposure to banks with less liquid assets, stable funds, and capital. We find that access to FinTech spurs firm growth, employment and investment relative to firms that get their loan application rejected. In addition, firms with access to FinTech increase leverage and substitute long-term bank debt with FinTech debt. Our findings suggest that FinTech allows firms to preserve financial flexibility, reduce their bank dependence and exposure to banking shocks. JEL Classification: G21, G23, O33 |
| Keywords: | bank relationships, debt structure, FinTech, firm growth, small business lending |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20222639&r= |
| By: | Gern, Klaus-Jürgen; Kooths, Stefan; Reents, Jan; Stolzenburg, Ulrich |
| Abstract: | Following an encouraging first half of the year, the recovery of the global economy has lost momentum. Across the globe, resurging Covid-19 infections weighed on economic activity. Supply chain disruptions prevented a further expansion of global industrial production, and the fast-moving recovery of the Chinese economy almost came to a sudden stop. The impact that the Omicron variant of the coronavirus will have on output remains uncertain at this stage. Over the next few months, we expect economic growth to be rather subdued before picking up again in 2022. We forecast global output (measured on a purchasing power parity basis) to increase by 5.7 percent in 2021 and 4.5 percent in 2022, representing a downward revision of our previous forecast by 0.2 and 0.5 percentage points for 2021 and 2022, respectively. For 2023, we have increased our forecast modestly from 3.8 percent to 4.0 percent. Inflation is thought to have peaked as the contribution of the energy component to overall inflation is expected to decline considerably going forward. Nonetheless, upward pressures on prices are expected to persist given continued supply constraints, and inflation rates will likely remain well above their respective pre-Covid levels. |
| Keywords: | advanced economies,emerging economies,monetary policy,COVID19 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwkeo:85&r= |
| By: | Borowiecki, Karol (Department of Economics); Dzieliński, Michał (Stockholm Business School); Tepper, Alexander (Columbia University United States) |
| Abstract: | The reasons for the Great Crash and why it occurred at that particular time are still debated among economic historians. We contribute to this debate by building on a new model developed by Adrian et al. (2021), which provides a measure of the financial system's potential for financial crises. The evidence suggests that a tightening of margin requirements in the first nine months of 1929 combined with price declines in September and early October caused enough many investors to become constrained that the market was tipped into instability, triggering the sudden crash of October and November. |
| Keywords: | Leverage; financial crisis; stability ratio; great crash |
| JEL: | G01 G10 N22 |
| Date: | 2022–02–23 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sdueko:2022_001&r= |
| By: | Haapanala, Henri (University of Antwerp); Marx, Ive (University of Antwerp); Parolin, Zachary (Bocconi University) |
| Abstract: | We analyse the moderating effect of trade unions on industrial employment and unemployment in countries facing exposure to industrial robots. Applying random effects within-between regression to a pseudo-panel of observations from 28 advanced democracies over 1998-2019, we find that stronger trade unions in a country are associated with a greater decline in the industry sector employment of young and low-educated workers. We also show that the unemployment rates for low-educated workers remain constant in strongly unionised countries with increasing exposure to robots, whereas in weakly unionised countries, low-educated unemployment declines with robot exposure but from a higher starting point. Our results point to unions exacerbating the insider-outsider effects of technological change within the industrial sector, which however is not fully passed on to unemployment. |
| Keywords: | trade unions, technological change, outsiders/insiders, dual labour market, unemployment, labour economics |
| JEL: | J5 |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15080&r= |
| By: | K. M., Mahesh; Aithal, Sreeramana; Sharma, KRS |
| Abstract: | Purpose: Sustainable Finance (SF) contributes to better development and better Finance for Economic growth. Sustainable development is protecting and restoring the ecological system. SIDBI, NITI Aayog, and World Bank facilitate Sustainable Finance to encourage businesses to grow from Small Medium Enterprises to large Industries to make an enormous global impact. As per the World Bank estimate, adversely affect the standard of living of the population and climate change will reduce India’s GDP by nearly 3%. For tracking the climate protection performance of the country, the CCPI tool is used. The Key sustainable finance providers to companies and MSME’s are Banks, Corporations, International Financial Institutions, Institutional Investors, International organizations through Financial Instruments Climate Funds, Green Bonds, Impact Finance, Social bonds, Microfinance, SIDBI Sustainable Finance Scheme for funding, NABARD, and Make in India. MSMEs, and SMEs involved in the Projects Solar Power Plants, renewable energy, Green Machinery, Waste Management, Electric Vehicles (EV), Clean Energy, Recycle, Poverty alleviations, and Energy conservation, and India is committed to achieving Net Zero Emissions by 2070. During the Climate summit in Glasgow, India accepted for Five –Point climate ‘panchamrit, or pledge’ towards climate change and Climate Finance. As per the Environment ministry. India needs $280 billion for green infrastructure and the government of India proposed the creation of a Social Stock Exchange, Europe Investment Bank (EIB) with SBI. RBI has considered Green and Sustainable projects should be put under Priority Sector Lending (PSL) to support GE (Green Economy) growth and to meet the SDG (Sustainable Development Goals) and ESG (Economic, Social, Environment) guidelines for fundraising. Methodology / Design /Approaches: In this article theoretical concepts are used in the analysis of various financing Mechanics for green production and Sustainable development. Findings and results: The effectiveness of sustainable finance or Climate finance required for MSME and Companies for greener production infrastructure and government of India missions on climate Change, Regular to boost the ESG to promote sustainable development and Economic growth. Originality/value: Analysed the various articles and case studies and prepared the model required for sustainable fiancé for green growth in India. |
| Keywords: | ESG, Climate Finance, Financial Institutions, Green Bonds, Green Economy, MSME’s, RBI, SIDBI, Social Stock Exchange, Sustainable Development Goals (SGS’s), ABCD analysis |
| JEL: | H3 H32 L8 L84 O1 P4 R3 |
| Date: | 2022–02–14 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:112058&r= |
| By: | Hasanjan Sayit |
| Abstract: | The classical Markowitz mean-variance model uses variance as a risk measure and calculates frontier portfolios in closed form by using standard optimization techniques. For general mean-risk models such closed form optimal portfolios are difficult to obtain. In this note, we obtain closed form expressions for frontier portfolios under mean-CVaR criteria when return vectors have normal mean-variance mixture (NMVM) distributions. To achieve this goal, we first present necessary conditions for stochastic dominance within the class of one dimensional NMVM models and then we apply them to portfolio optimization problems. Our main result in this paper states that when return vectors follow NMVM distributions the associated mean- CVaR frontier portfolios can be obtained by optimizing a Markowitz mean-variance model with an appropriately adjusted return vector |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2202.02488&r= |
| By: | Aneel Bhusal; Madhu Sudan Gautam |
| Abstract: | The purpose of this study is to examine the long-run relationship between gold prices and Nepal Stock Exchange (NEPSE). |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2202.00007&r= |
| By: | Isaac K. Ofori (University of Insubria, Varese, Italy); Christopher Quaidoo (Legon, Accra, Ghana); Pamela E. Ofori (University of Insubria, Varese, Italy) |
| Abstract: | This study uses machine learning techniques to identify the key drivers of financial development in Africa. To this end, four regularization techniques— the Standard lasso, Adaptive lasso, the minimum Schwarz Bayesian information criterion lasso, and the Elasticnet are trained based on a dataset containing 86 covariates of financial development for the period 1990 – 2019. The results show that variables such as cell phones, economic globalisation, institutional effectiveness, and literacy are crucial for financial sector development in Africa. Evidence from the Partialing-out lasso instrumental variable regression reveals that while inflation and agricultural sector employment suppress financial sector development, cell phones and institutional effectiveness are remarkable in spurring financial sector development in Africa. Policy recommendations are provided in line with the rise in globalisation, and technological progress in Africa. |
| Keywords: | Africa, Elasticnet, Financial Development, Financial Inclusion, Lasso, Regularization, Variable Selection |
| JEL: | C01 C14 C52 C53 C55 E5 O55 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:abh:wpaper:21/074&r= |
| By: | sahoo, satyabrata (Shree Guru Gobind Singh Tricentenary University: Gurgaon, Haryana, IN) |
| Abstract: | Entrepreneurship plays a paramount role in the magnification and development of the economy of any country. Entrepreneurship acts as a vaccine for a nation's economic prosperity, leading to the generation of employment opportunities, national income, rural development, technological development, industrialization, export promotion, etc. Many institutes and companies are involved in entrepreneurship development activities, and some join these programs as a stepping stone to becoming an entrepreneur. Entrepreneurs convert conceptions into economic opportunities through innovations considered a significant source of competitiveness in an increasingly globalizing world economy. Ergo, most regimes strive to augment the supply of competent and ecumenically competitive entrepreneurs in their respective countries. The primary purport of this research is to understand the paramountcy of entrepreneurship in India. Numerous factors need to be considered while expertise the significance of entrepreneurship. Entrepreneurs experience several opportunities and challenges inside the direction of pursuance in their goals and targets. |
| Date: | 2021–12–08 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:6x2hm&r= |
| By: | Franck Aggeri (CGS i3 - Centre de Gestion Scientifique i3 - CNRS - Centre National de la Recherche Scientifique - MINES ParisTech - École nationale supérieure des mines de Paris - PSL - Université Paris sciences et lettres) |
| Abstract: | Contrary to a commonly held belief, the circular economy was the dominant economic model for a long period. Nothing was lost or discarded, everything was systematically recovered and reused. At the end of the 19th century, it was superseded by the linear economic model, based on extracting new raw materials and disposing of waste in landfills, that accompanied the industrial revolution and rise of the hygienist movement followed by the growth of the consumer society. The present-day challenge is to develop a new approach to the circular economy that meets expectations in terms of quality and traceability as well as exploring new economic models that are less resource-intensive. But while innovations are certainly needed, in recycling, for example, as a strategy it is not a magic bullet. This is because recycling corresponds to a weak circularity model that fails to challenge how we produce and consume. For a strong and less resource-intensive circularity model to emerge, we need to explore services-based strategies that seek to extend product lives via repair, reuse or rental, all of which require upstream efforts in terms of eco-designing products to improve their repairability and durability. |
| Keywords: | circular economy,urban mines,waste |
| Date: | 2021–11 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03503289&r= |
| By: | Natasha Sarin (University of Pennsylvania); Lawrence Summers (Harvard University and NBER); Owen Zidar (Princeton University and NBER); Eric Zwick (University of Chicago and NBER) |
| Abstract: | We argue the revenue potential from increasing tax rates on capital gains may be substantially greater than previously understood. First, many prior studies focus primarily on short-run taxpayer responses, and so miss revenue from gains that are deferred when rates change. Second, the rise of pass-throughs and index funds has shifted the composition of capital gains in recent years, such that the share of gains that are highly elastic to the tax rate has likely declined. If some components are less elastic, then their elasticity should get more weight when scoring big changes because they will comprise more of the remaining tax base. Third, closer parity to income rates would provide a backstop to rest of tax system. Fourth, additional base-broadening reforms, like eliminating stepped-up basis, making charitable giving a realization event, reforming donor advised funds, and limiting opportunity zones to places with the highest poverty rates, will decrease the elasticity of the tax base to rate changes. Overall, we do not think the prevailing assumption of many in the scorekeeping community—that raising rates to top ordinary income levels would raise little revenue—is warranted. A crude calculation illustrates that raising capital gains rates to ordinary income levels could raise hundreds of billions more revenue over a decade than other leading estimates suggest. |
| Keywords: | tax rates, capital gains, revenue |
| JEL: | H00 H20 H30 |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:pri:econom:2021-22&r= |
| By: | Pham, Chau (University of Warwick) |
| Abstract: | This paper addresses two issues : the underinvestment in education and the povertytrap that ensues for poor households. In a setting where the end outcome is binary, aninvesting agent faces two levels of risk, one in the intermediate outcome - how muchhuman capital she obtains for a given amount of investment, and one inherent in theend outcome - whether she gets the high-paid job. We show that when human capital is inheritable, risk-averse agents are deterred from investing because their parentsare not sufficiently educated. Moreover, the U-shaped expected utility means theoptimal investment occurs at either corners. If this investment or underinvestment is sustained through generations, a separating equilibrium such that poor households do not invest while wealthier ones do emerges. The divergence in educational attainmenttranslates into a divergence in wealth between those who invest and those who do not.A simple calibration employing data from the NLSY97 demonstrates the existence ofthese equilibria at different levels of risk-aversion. |
| Keywords: | intergenerational human capital ; poverty trap ; risk-aversion ; underinvestment JEL Classification: I32 ; I24 ; C60 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:wrkesp:28&r= |
| By: | Ogulcan E. Orsel; Sasha S. Yamada |
| Abstract: | In this work, we apply machine learning techniques to historical stock prices to forecast future prices. To achieve this, we use recursive approaches that are appropriate for handling time series data. In particular, we apply a linear Kalman filter and different varieties of long short-term memory (LSTM) architectures to historical stock prices over a 10-year range (1/1/2011 - 1/1/2021). We quantify the results of these models by computing the error of the predicted values versus the historical values of each stock. We find that of the algorithms we investigated, a simple linear Kalman filter can predict the next-day value of stocks with low-volatility (e.g., Microsoft) surprisingly well. However, in the case of high-volatility stocks (e.g., Tesla) the more complex LSTM algorithms significantly outperform the Kalman filter. Our results show that we can classify different types of stocks and then train an LSTM for each stock type. This method could be used to automate portfolio generation for a target return rate. |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2202.03156&r= |
| By: | Christoph Görtz; Konstantinos Theodoridis; Christoph Thoenissen |
| Abstract: | We estimate a novel state-space model to jointly identify international technology trend shocks originating in the US economy as well as shocks that are specific to the UK economy. We further differentiate between technological innovations arising from changes in total factor productivity (TFP) and changes in investment specific technology (IST). The long run restrictions used to identify the structural trends in the data are informed by a standard twocountry structural model. We find that international non-stationary technology shocks explain about 26% of the variance of UK GDP. About two thirds of this contribution is driven by the international IST shock. UK-specific disturbances account for the bulk of the volatility in the data. When estimating the effects of international IST and TFP shocks on the remaining G7 countries, we find results are consistent with those for the UK in that the international productivity shocks play a relevant role in explaining aggregate fluctuations. An impulse response function matching exercise shows that the structural model, which informed the long-run restrictions used in our empirical investigation, can generate dynamics consistent with those in the data. |
| Keywords: | Non-stationary productivity shocks, TFP, investment specific technology shocks, trend shocks, DSGE modelling, state space model |
| JEL: | E2 E3 |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2022-06&r= |
| By: | Brian Hill (HEC Paris - Recherche - Hors Laboratoire - HEC Paris - Ecole des Hautes Etudes Commerciales, CNRS - Centre National de la Recherche Scientifique, GREGH - Groupement de Recherche et d'Etudes en Gestion à HEC - HEC Paris - Ecole des Hautes Etudes Commerciales - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | A series of famous examples casts doubt on the standard, Bayesian account of belief and decision in situations of considerable uncertainty. They have spawned a significant literature in economics, and to a lesser extent philosophy. This chapter some of this literature, with an emphasis on the normative issue of rational decision. [Pre-print version: please see the book for the final version, and cite it.] |
| Date: | 2021–12–14 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03504015&r= |
| By: | Gregor Jarosch (Princeton University and NBER); Jan Sebastian Nimczik (ESMT Berlin and IZA); Isaac Sorkin (Stanford University and NBER) |
| Abstract: | We develop a model where labor market structure affects the division of surplus between firms and workers. In a model of random search and large employers, workers might apply to another job controlled by the same employer in the future. This possibility endows firms with size-based market power. The reason is that outside options are truly outside the firm: firms do not compete with their own vacancies. Hence, a worker’s outside option is worse when bargaining with a larger firm, and wages depend on market structure. We calibrate the model to Austrian data and find that such size-based market power depresses wages. |
| Keywords: | labor market, labor economics |
| JEL: | E20 J01 |
| Date: | 2021–07 |
| URL: | http://d.repec.org/n?u=RePEc:pri:econom:2021-38&r= |
| By: | Ameni Ben Salem (Fseg Sousse, University of Sousse); Imene Safer; Islem Khefacha (LaREMFiQ, IHEC of Sousse) |
| Date: | 2021–12–17 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03502428&r= |
| By: | Komeda, Kenji (University of Warwick) |
| Abstract: | This paper estimates the effect of air pollution, water pollution and water scarcity on internal migration in India using gravity model with 2SLS estimation. It contributes to the literature by first incorporating nationwide migrants and those three environmental factors into the analysis. The migration data is drawn from the Indian Census 2001 and 2011 and provides us with state-district pair-wise migration flows for certain time periods. With a wide range of data sources including Indian government platforms and satellite data, this study compiles a rich and comprehensive dataset. We find that the increase in air pollutant (PM2.5) at origin pushes out migrants, with larger influence on male than female. This paper also discovers, with more robust evidence, that the increase in groundwater level, a proxy for water scarcity level, at origin leads to less out-migrants and increase in groundwater at destination pulls more in-migrants for both genders. However, consistent evidence on water pollutants was not found. |
| Keywords: | Internal Migration ; Pollution ; Water Scarcity ; Gender Inequality ; Gravity Model JEL Classification: J16 ; J61 ; O15 ; Q25 ; Q53 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:wrkesp:20&r= |
| By: | Bent Flyvbjerg |
| Abstract: | Behavioral science has witnessed an explosion in the number of biases identified by behavioral scientists, to more than 200 at present. This article identifies the 10 most important behavioral biases for project management. First, we argue it is a mistake to equate behavioral bias with cognitive bias, as is common. Cognitive bias is half the story; political bias the other half. Second, we list the top 10 behavioral biases in project management: (1) strategic misrepresentation, (2) optimism bias, (3) uniqueness bias, (4) the planning fallacy, (5) overconfidence bias, (6) hindsight bias, (7) availability bias, (8) the base rate fallacy, (9) anchoring, and (10) escalation of commitment. Each bias is defined, and its impacts on project management are explained, with examples. Third, base rate neglect is identified as a primary reason that projects underperform. This is supported by presentation of the most comprehensive set of base rates that exist in project management scholarship, from 2,062 projects. Finally, recent findings of power law outcomes in project performance are identified as a possible first stage in discovering a general theory of project management, with more fundamental and more scientific explanations of project outcomes than found in conventional theory. |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2202.00125&r= |
| By: | Karen Croxson; Jon Frost; Leonardo Gambacorta; Tommaso Valletti |
| Abstract: | Three types of digital platforms are expanding in financial services: (i) fintech entrants; (ii) big tech firms; and (iii) increasingly, incumbent financial institutions with platformbased business models. These platforms can dramatically lower costs and thereby aid financial inclusion – but these same features can give rise to digital monopolies and oligopolies. Digital platforms operate in multi-sided markets, and rely crucially on big data. This leads to specific network effects, returns to scale and scope, and policy trade-offs. To reap the benefits of platforms while mitigating risks, policy makers can: (i) apply existing financial, antitrust and privacy regulations, (ii) adapt old and adopt new regulations, combining an activity and entity-based approach, and/or (iii) provide new public infrastructures. The latter include digital identity, retail fast payment systems and central bank digital currencies (CBDCs). These public infrastructures, as well as ex ante competition rules and data portability, are particularly promising. Yet to achieve their policy goals, central banks and financial regulators need to coordinate with competition and data protection authorities. |
| Keywords: | financial inclusion, fintech, big tech, platforms |
| JEL: | E51 G23 O31 |
| Date: | 2021–12 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:986&r= |
| By: | Patrick C. Harms |
| Abstract: | The paper adds to the literature as follows: starting from the benchmark model of Asdrubali et al. (1996), we reproduce the original specification with a data set obtained from the authors as well as possible. In a second step, this specification is brought to euro area data. Again, the results are broadly in line with the existing literature (Furceri and Zdzienicka, 2015). We report rolling window and recursive estimates and show high time variation in the coefficients. The parameter estimates are related to a recession dummy in the euro area (confirmed by structural break tests) and very sensitive to the exclusion of countries like Ireland and Luxembourg. Granger causality analysis in a VAR approach also points to a strong dependence on the macroeconomic environment. Last but not least we discuss shortcomings of the approach. All in all the high time variability of the results in a benchmark model in the spirit of Asdrubali et al. (1996) makes it difficult to draw robust policy recommendations for the euro area. |
| Keywords: | Economic and Monetary Union, Risk Sharing Mechanismus |
| JEL: | F41 F32 F36 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:imk:wpaper:208-2021&r= |
| By: | Natacha Bourova (CESICE - Centre d'études sur la sécurité internationale et les coopérations européennes - UGA - Université Grenoble Alpes - IEPG - Sciences Po Grenoble - Institut d'études politiques de Grenoble - UGA - Université Grenoble Alpes); Jacques Fontanel (CESICE - Centre d'études sur la sécurité internationale et les coopérations européennes - UPMF - Université Pierre Mendès France - Grenoble 2 - IEPG - Sciences Po Grenoble - Institut d'études politiques de Grenoble) |
| Abstract: | GDP is the most widely used economic aggregate to compare, over time and space, the development of the national economy. International experts usually refer to this indicator to comment on the national economy. Its weight is important in determining the classification of countries according to their degree of development among developed countries. However, the limitations of GDP are both technical and conceptual. Real GDP (removing the effects of inflation) per capita does not refer to the productive and redistributive inequalities of economic actors. It does not include bad goods, pollution and it does not account for many free activities. The unique or dominant reference to GDP is dangerous. Economic actors should no longer be encouraged to go in the direction of an unsustainable form of growth. It is necessary to have indicators on democratic freedoms, citizen solidarity, cultural influence, the rise of the digital economy and artificial intelligence. It is also essential to count the negative effects of growth and their discounted costs, such as the definitive disappearance of certain raw materials, the influence of pollution on the people concerned and, in international relations, its effects on neighboring countries. |
| Abstract: | Le PIB est l'agrégat économique le plus largement utilisé pour comparer, dans le temps et dans l'espace, le développement de l'économie nationale. Les experts internationaux se réfèrent généralement à cet indicateur pour commenter l'économie nationale. Son poids est important pour déterminer la classification des pays en fonction de leur degré de développement entre pays développés. Cependant, les limites du PIB sont à la fois techniques et conceptuelles. Le PIB réel (en éliminant les effets de l'inflation) par habitant ne fait pas référence aux inégalités productives et redistributives des acteurs économiques. Il n'inclut pas les mauvais biens, la pollution et il ne comptabilise pas beaucoup d'activités gratuites. La référence unique ou dominante au PIB est dangereuse. Les acteurs économiques ne doivent plus être encouragés à aller dans le sens d'une forme de croissance non durable. Il est nécessaire d'avoir des indicateurs sur les libertés démocratiques, la solidarité citoyenne, le rayonnement culturel, l'essor de l'économie numérique et de l'intelligence artificielle. Il est également primordial de compter les effets négatifs de la croissance et leurs coûts actualisés, comme la disparition définitive de certaines matières premières, l'influence des pollutions sur les personnes concernées et, dans les relations internationales, leurs effets sur les pays voisins. |
| Keywords: | GDP,Sustainable development,public goods.,PIB,Développement durable,biens publics |
| Date: | 2021–12–14 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03501925&r= |
| By: | Xiaosheng Mu (Princeton University); Luciano Pomatto (Caltech); Philipp Strack (Yale University); Omer Tamuz (Caltech) |
| Abstract: | We show that under plausible levels of background risk, no theory of choice under risk can simultaneously satisfy the following three economic postulates: (i) Decision makers are risk-averse over small gambles, (ii) their preferences respect stochastic dominance, and (iii) they account for background risk. This impossibility result applies to expected utility theory, prospect theory, rank dependent utility and many other models. |
| Keywords: | risk, theories of choice |
| JEL: | D81 |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:pri:econom:2021-26&r= |
| By: | Christoph Görtz; Mallory Yeromonahos |
| Abstract: | A large literature suggests that the expected equity risk premium is countercyclical. Using a variety of different measures for this risk premium, we document that it also exhibits growth asymmetry, i.e. the risk premium rises sharply in recessions and declines much more gradually during the following recoveries. We show that a model with recursive preferences, in which agents cannot perfectly observe the state of current productivity, can generate the observed asymmetry in the risk premium. Key for this result are endogenous fluctuations in uncertainty which induce procyclical variations in agent’s nowcast accuracy. In addition to matching moments of the risk premium, the model is also successful in generating the growth asymmetry in macroeconomic aggregates observed in the data, and in matching the cyclical relation between quantities and the risk premium. |
| Keywords: | Risk Premium, Business cycles, Bayesian Learning, Asymmetry, Uncertainty, Nowcasting. |
| JEL: | E2 E3 G1 |
| Date: | 2021–12 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2021-101&r= |
| By: | Haidar, Jamal Ibrahim |
| Abstract: | Using disaggregated customs data about exporters from nine countries, I demonstrate that informational externalities are determinants of entry, survival, and growth of exporters at the product–destination market level. I show that exporters who optimize entry decisions and internalize informational externalities survive longer and grow faster. Then, I conceptualize why exporters enter certain international markets and why not all exporters from the same origin survive and grow in these markets. I incorporate the interaction between the performance and number of peers in a given market to identify a potential learning externality that exporters may be exposed to. Also, I highlight that, even without the formation of formal networks, the observation of the actions of peers in export markets can deliver implications for export flows: exporters may not need to start small in new markets if the actions of peers in those markets reveal enough information. By helping to explain how export relationships survive and grow, I complement the literature on the determinants of export diversification and signal to export promotion agencies the importance of internalization of informational externalities by exporters. |
| Keywords: | exporters dynamics; peer effects; informational externalities; market entry; diversification; trade; development |
| JEL: | F1 F10 F11 F14 |
| Date: | 2021–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:111935&r= |
| By: | Fabio Calonaci; George Kapetanios; Simon Price |
| Abstract: | We re-examine predictability of US stock returns. Theoretically well-founded models predict that stationary combinations of I (1) variables such as the dividend or earnings to price ratios or the consumption/asset/income relationship often known as CAY may predict returns. However, there is evidence that these relationships are unstable, and that allowing for discrete shifts in the unconditional mean (location shifts) can lead to greater predictability. It is unclear why there should be a small number of discrete shifts and we allow for more general instability in the predictors, characterised by smooth variation, using a method introduced by Giraitis, Kapetanios and Yates. This can remove persistent components from observed time series, that may otherwise account for the presence of near unit root type behaviour. Our methodology may therefore be seen as an alternative to the widely used IVX methods where there is strong persistence in the predictor. We apply this to the three predictors mentioned above in a sample from 1952 to 2019 (including the financial crisis but excluding the Covid pandemic) and find that modelling smooth instability improves predictability and forecasting performance and tends to outperform discrete location shifts, whether identified by in-sample Bai-Perron tests or Markov-switching models. |
| Keywords: | returns predictability, long horizons, instability |
| JEL: | G17 C53 |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2022-04&r= |
| By: | M. Ajide, Folorunsho (Department of Economics) |
| Abstract: | Purpose ─ Literature suggests that entrepreneurship can serve as a veritable tool for providing decent employment and improving economic prosperity. Therefore, the objective of this study is to examine the impact of economic freedom on entrepreneurship in Africa. Design/methodology/approach ─ The study employs data of 18 African countries covering a period of 2007-2018. The analysis is based on the following techniques: Panel-Corrected Standard Errors (PCSE), generalized method of moments, Hausman–Taylor IV estimator and Driscoll-Kraay standard errors. Findings ─ Finding based on Panel-Corrected Standard Errors (PCSE) technique reveals that economic freedom and its dimensions improve the level of entrepreneurship in Africa. This finding is robust to other alternative estimation techniques. Secured property right, relaxed tax burden, monetary freedom, trade freedom, freedom from corruption, investment freedom, financial freedom, business freedom and labor freedom have positive impact on African entrepreneurship. Practical implications ─ The study, hence, suggests that policy should be implemented to maximize the level of economic and fundamental freedom of citizens to encourage indigenous entrepreneurs in Africa. Quality of infrastructure should be improved as well as simplification of firms’ registration procedures. African government also needs to build effective and efficient institutional framework to maintain government integrity in Africa. Originality/value ─ The position of African countries in the nexus between economic freedom and entrepreneurship is rarely discussed in the literature. Hence, this study contributes in this respect and showcases how economic freedom influence the decision to engage in entrepreneurial venture in African perspectives. |
| Keywords: | economic institutions; startups; Hausman–Taylor IV estimator; Africa |
| JEL: | L26 M13 O55 P14 |
| Date: | 2022–02–13 |
| URL: | http://d.repec.org/n?u=RePEc:ris:decilo:0019&r= |
| By: | Jasmine Mondolo |
| Abstract: | In recent years, the US and other advanced countries have experienced macroeconomic dynamics which raise some concerns and which, according to the literature, are at least partly attributable to a rise in product market power. This study mainly aims to understand how Italy performs in terms of five relevant economic variables (i.e., domestic investment rate, labour share, labour force participation, wage inequality and economic dynamism), and whether firms’ markups are on the rise. The picture that emerges is mixed, and the negative performance in terms of business dynamism and wage dispersion may be ascribable to an increase in product market power. The firm-level analysis of the Italian manufacturing sector for the years 2011- 2018, which complements previous empirical analysis on product market power in this country and accounts for labour market power as well, reveals an increment in the average markup which, however, is not particularly pronounced and unsettling, and which is preceded by a period of steady decline. Moreover, this trend is accompanied by a more remarkable increase in the workers’ labour market power, which helps explain the modest growth in the revenue- based labour share observed during the same period. |
| Keywords: | labour share, market power, markup, investment, inequality |
| JEL: | E25 J42 L11 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:trn:utwprg:2021/17&r= |
| By: | Mark Aguiar (Princeton University and NBER); Manuel Amador (University of Minnesota); Cristina Arellano (Federal Reserve Bank of Minneapolis) |
| Abstract: | We provide sufficient conditions for the feasibility of a Pareto-improving fiscal policy when the risk-free interest rate on government bonds is below the growth rate (r |
| Keywords: | fiscal policy |
| JEL: | E62 H30 |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:pri:econom:2021-15&r= |
| By: | Caio Almeida (Princeton University); Jianqing Fan (Princeton University); Francesca Tang (Princeton University) |
| Abstract: | We introduce a novel approach to capture implied volatility smiles. Given any parametric option pricing model used to fit a smile, we train a deep feedforward neural network on the model’s orthogonal residuals to correct for potential mispricings and boost performance. Using a large number of recent S&P500 options, we compare our hybrid machine-corrected model to several standalone parametric models ranging from ad-hoc corrections of Black-Scholes to more structural noarbitrage stochastic volatility models. Empirical results based on out-of-sample fitting errors - in cross-sectional and time-series dimensions - consistently confirm that a machine can in fact correct existing models without overfitting. Moreover, we find that our two-step technique is relatively indiscriminate: regardless of the bias or structure of the original parametric model, our boosting approach is able to correct it to approximately the same degree. Hence, our methodology is adaptable and versatile in its application to a large range of parametric option pricing models. As an overarching theme, machine corrected methods, guided by an implied volatility model as a template, outperform pure machine learning methods. |
| Keywords: | Deep Learning, Boosting, Implied Volatility, Stochastic Volatility, Model Correction |
| JEL: | E37 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:pri:econom:2021-44&r= |
| By: | Hafner, C. M. |
| Abstract: | We introduce a new class of semiparametric dynamic autoregressive models for the Amihud illiquidity measure, which captures both the long-run trend in the illiquidity series with a nonparametric component and the short-run dynamics with an autoregressive component. We develop a GMM estimator based on conditional moment restrictions and an efficient semiparametric ML estimator based on an iid assumption. We derive large sample properties for both estimators. We further develop a methodology to detect the occurrence of permanent and transitory breaks in the illiquidity process. Finally, we demonstrate the model performance and its empirical relevance on two applications. First, we study the impact of stock splits on the illiquidity dynamics of the five largest US technology company stocks. Second, we investigate how the different components of the illiquidity process obtained from our model relate to the stock market risk premium using data on the S&P 500 stock market index. |
| Keywords: | Nonparametric, Semiparametric, Splits, Structural Change |
| JEL: | C12 C14 |
| Date: | 2022–02–23 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:2214&r= |
| By: | Wijenayaka, Amal |
| Abstract: | The world is rapidly changing. As a result, organizations have to find new ways to compete with close competitors. It is challenging to use traditional methods and ways. Advertising and price war are not gaining sustainable competitive advantage further. Most past researches mentioned that Innovation is the key to future success. Furthermore, it is required to transform to digitalization. It provides new insight into the organization. Market volatility is a huge challenge to the organization. However, it can be managed with digitalization and Innovation. |
| Date: | 2022–01–05 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:xyfbt&r= |
| By: | Georgarakos, Dimitris; Kenny, Geoff |
| Abstract: | This paper introduces the Consumer Expectations Survey (CES), a new online, high frequency panel survey of euro area consumers’ expectations and behaviour. The paper also investigates whether public perceptions about fiscal support measures introduced during the pandemic have influenced spending behaviour. We show that simple and factual information treatments about government support policies that are communicated to random subsets of respondents can help improve consumers’ perceptions about the adequacy of fiscal interventions relative to the perceptions of an untreated control group. We find evidence that this improvement in beliefs has a causal effect on consumer spending, in particular raising spending on large items like holidays and cars. Moreover, we show that such beliefs also influence household expectations about own income prospects, future access to credit and financial sentiment, while they do not affect expectations about future taxes, implying no evidence of Ricardian effects in household behaviour. We find that perceptions affect spending also among households that did not receive any government support, suggesting that fiscal interventions can have broader consequences as they influence the behaviour of groups beyond the targeted ones. JEL Classification: D12, E21, H31 |
| Keywords: | Consumer Expectations Survey, COVID-19, fiscal policy, household perceptions |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20222643&r= |
| By: | Kwon, Ohyun (Drexel University); Syropoulos, Constantinos (Drexel University); Yotov, Yoto (Drexel University) |
| Abstract: | We provide quantitative evidence that the primary effects of economic sanctions on trade and welfare are accompanied by strong extraterritorial effects - estimates of the former effects may be significantly biased if the latter effects are not taken into account. Furthermore, while the extraterritorial burden of sanctions on trade falls primarily on target countries, the corresponding effect on trade among senders and third countries is positive. General equilibrium analysis suggests that, for targets, the welfare losses due to extraterritorial effects are large and may exceed the losses due to reduced trade with senders. For senders, the gains from increased trade with third countries may outweigh the losses from decreased trade with targets to generate net welfare gains. The welfare effects on third countries are significant, too. However, the direction and size of these effects depend on three key factors: the size of the target, the size of the sender, and the economic ties among the target, the sender, and third countries. |
| Keywords: | Economic Sanctions; Primary Effects; Extraterritorial Effects; Trade; Welfare |
| JEL: | F14 F51 Q17 |
| Date: | 2022–01–28 |
| URL: | http://d.repec.org/n?u=RePEc:ris:drxlwp:2022_003&r= |
| By: | E. Mark Curtis; Daniel G. Garrett; Eric Ohrn; Kevin A. Roberts; Juan Carlos Suarez Serrato |
| Abstract: | We study how bonus depreciation, a policy designed to lower the cost of capital, impacted investment and labor demand in the US manufacturing sector. Difference-in-differences estimates using restricted-use US Census Data on manufacturing establishments show that this policy increased both investment and employment, but did not lead to wage or productivity gains. Using a structural model, we show that the primary effect of the policy was to increase the use of all inputs by lowering overall costs of production. The policy further stimulated production employment due to the complementarity of production labor and capital. Supporting this conclusion, we nd that investment is greater in plants with lower labor costs. Our results show that recent policies that incentivize capital investment do not lead manufacturing plants to replace workers with machines. |
| Keywords: | capital-labor substitution, bonus depreciation, corporate taxation |
| JEL: | D22 H25 H32 J23 |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:22-04&r= |
| By: | Baines, Joseph; Hager, Sandy Brian |
| Abstract: | This article examines the role of the Big Three asset management firms – BlackRock, Vanguard and State Street – in corporate environmental governance. Specifically, it charts the Big Three’s relationships with the publicly-owned Carbon Majors: a small group of fossil fuels, cement and mining companies responsible for the bulk of industrial greenhouse gas emissions. It finds that the Big Three much more often than not oppose rather than support shareholder resolutions aimed at improving environmental governance. Notably, this is even the case with the Big Three’s environmental, social and governance funds. A more fine-gained analysis shows that the combined voting decisions of the Big Three are more likely to lead to the failure than to the success of environmental resolutions and that, whether they succeed or fail, these resolutions tend to be narrow in scope and piecemeal in nature. Based on these findings, the article raises serious doubts about the Big Three’s credentials as environmental stewards. |
| Keywords: | climate,finance,oil,ownership and control |
| JEL: | P16 P26 P48 P28 G2 G3 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:249674&r= |