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on European Economics |
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Issue of 2006‒12‒16
seventeen papers chosen by Giuseppe Marotta Universita di Modena e Reggio Emilia |
| By: | Rachel Griffith; Elena Huergo; Jacques Mairesse; Bettina Peters |
| Abstract: | This paper compares the role innovation plays in productivity across the four European countries France, Germany, Spain and the UK using firm-level data from the internationally harmonized Community Innovation Surveys (CIS3). Despite a considerable number of national firm-level studies analysing this relationship, cross-country comparisons using micro data are still rare. We apply a structural model that describes the link between R&D expenditure, innovation output and productivity (CDM model). Our econometric results suggest that overall the systems driving innovation and productivity are remarkably similar across these four countries, although we also find interesting differences, particularly in the variation in productivity that is associated with more or less innovative activities. |
| JEL: | L1 L60 O31 O33 O47 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:12722&r=eec |
| By: | Giovanni Dosi; Patrick Llerena; Mauro Sylos Labin |
| Abstract: | This paper discusses, first, the properties of scientific and technological knowledge and the institutions supporting its generation and its economic applications. The evidence continues to support the broad interpretation which we call the ”Stanford-Yale-Sussex” synthesis. Second, such patterns bear important implications with respect to the so-called ”European Paradox”, i.e. the conjecture that EU countries play a leading global role in terms of top-level scientific output, but lag behind in the ability of converting this strength into wealth-generating innovations. Some descriptive evidence shows that, contrary to the ”paradox” conjecture, European weaknesses reside both in its system of scientific research and in a relatively weak industry. The final part of the work suggests a few normative implications: much less emphasis should be put on various types of ”networking” and much more on policy measures aimed to both strengthen ”frontier” research and strengthen European corporate actors. |
| Keywords: | Open Science, European Paradox, Science and Technology Policy. |
| JEL: | D80 O33 O38 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2005-11&r=eec |
| By: | Martynova,Marina; Renneboog,Luc (Tilburg University, Center for Economic Research) |
| Abstract: | For the 5th takeover wave, European M&As were expected to create significant takeover value: the announcement reactions were strongly positive for target shareholders (more than 35%) and the bidding shareholders also expected to gain a small though significant increase in market value of 0.5%. While, most of the expected takeover synergies are captured by the target firm shareholders, The combined value creation is significantly positive. However, the expected value strongly depends on the wave pattern, with optimistic expectations at the climax of the wave and a more pessimistic outlook at the decline. We establish that the characteristics of the target and bidding firms and of the bid itself have a significant impact on takeover returns. While some of our results have been documented for other markets of corporate control (e.g. US), a comparison of the UK and Continental European M&A markets reveals that the corporate environment is an important factor affecting the market reaction to takeovers: (i) In case a UK firm is taken over, the abnormal returns exceed those in bids involving a Continental European target. (ii) The presence of a large shareholder in the bidding firm has a significantly positive effect on the takeover returns in the UK and a negative one in Continental Europe. (iii) Weak investor protection and low disclosure environment in Continental Europe enable bidding firms to invent takeover strategies that allow them to act opportunistically towards target firm's incumbent shareholders; more specifically, partial acquisitions and acquisitions with undisclosed terms of transaction. |
| Keywords: | takeovers;mergers and acquisitions;diversification;hostile takeover;means of payment;cross-border acquisitions;private target;partial acquisitions |
| JEL: | G34 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:2006118&r=eec |
| By: | Bronwyn H. Hall (University of California at Berkeley, University of Maastricht, NBER, and IFS London.); Grid Thoma (University of Camerino and CESPRI Bocconi University, Milano, Italy.); Salvatore Torrisi (Bologna University and CESPRI Bocconi University, Milan, Italy.) |
| Abstract: | This paper provides novel empirical evidence on the private value of patents and R&D. We analyze an unbalanced sample of firms from five EU countries - France, Germany, Switzerland, Sweden and the UK in the period 1985-2005. We explore the relationship between firm’s stock market value and patents, accounting for the ‘quality’ of EPO patents. We find that Tobin’s q is positively and significantly associated with R&D and patent stocks. In contrast to results for the U.S., forward citations do not add information beyond that in patents. However, the composite quality indicator based on backward citations, forward citations and the number of technical fields covered by the patent is informative for value. Software patents account for a rising share of total patents in the EPO. Moreover, some scholars of innovation and intellectual property rights argue that software and business methods patents on average are of poor quality and that these patents are applied for merely to build portfolios rather than for protection of real inventions. We therefore tested for the impact of software patents on the market value of the firm and did not find any significant effect, in contrast to results for the United States. However, in Europe, such patents are highly concentrated, with 90 per cent of the software patents in our sample held by just 15 of the firms. |
| Keywords: | Market Valuation, Intangible Assets, Patents, Software. |
| JEL: | D24 O31 O34 L86 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cri:cespri:wp186&r=eec |
| By: | Luca Barani |
| Abstract: | The European integrative experiment rests on a dynamic equilibrium of intergovernmental and supranational features of the regulatory framework of the European Union. One of the most important challenges to this system currently lies in finding ways to maintain its capacity to operate and, at the same time, adapt its problem-solving instruments to changing conditions of the regulatory politics. The current pragmatic mix of regulative strategies employed in the European Union allows for different possible scenarios concerning future development of the regulatory system within the EU. The article analyses the emergence and proliferation of new forms of decision-making and related legal techniques in the European Union. The origins and possible trajectory of a whole spectrum of contemporary legal techniques and governance methods, ranging from 'hard' to 'soft', are being contextualized. Special attention is given to the Open Method of Coordination and examples of its application in the social policy field. |
| Keywords: | regulatory politics; rule of law; social policy |
| Date: | 2006–05–16 |
| URL: | http://d.repec.org/n?u=RePEc:erp:conweb:p0024&r=eec |
| By: | Jokipii, Terhi (Bank of Finland Research) |
| Abstract: | This paper studies the extent to which market crashes are predictable for a set of six countries, focusing in particular on possible differences between transition economies (The Czech Republic, Hungary and Poland) and mature markets (UK, US and EU). We estimate a set of individual country and pooled specifications to find that market crashes, in the broader sense, are predictable for all countries analysed. We additionally investigate the role that investor heterogeneity, proxied by trading volume, plays in this predictability and find some varying results between countries. For the Central and Eastern European Countries (CE3), an increase in trading volume relative to trend appears to have great predictive power, a result that is supportive of the theory of investor heterogeneity outlined in the relevant background studies. For the more mature markets (G5), on the other hand, market crashes appear more likely to follow a period of increased stock prices and returns, a result fitting a number of traditional theories, in particular the stochastic bubble model. Further analysis, allowing for time-varying coefficients, confirms the volume-crash relationship for the CE3 and provides preliminary evidence that macro news releases may additionally contribute to the predictability of market crashes. |
| Keywords: | aggregate market returns; skewness; trading volume; market crash |
| JEL: | C14 G12 G15 |
| Date: | 2006–12–14 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:bofrdp:2006_022&r=eec |
| By: | Darmoul Mokhtar (CES - Centre d'économie de la Sorbonne - [CNRS : UMR8174] - [Université Panthéon-Sorbonne - Paris I]) |
| Abstract: | In this paper, we investigate the impact of monetary policy signals stemming from the ECB Council and the FOMC on the intradaily Euro-dollar volatility, using high-frequency data (five minutes frequency). For that, we estimate an AR(1)-GARCH(1,1) model, which integrates a polynomials structure depending on signal variables, starting from the deseasonalized exchange rate returns series. This structure allows us to test the signals persistence one hour after their occurence and to reveal a dissymmetry between the effect of the ECB and Federal Reserve signals on the exchange rate volatility. |
| Keywords: | Exchange rates, official interventions, monetary policy, GARCH models. |
| Date: | 2006–12–06 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00118789_v1&r=eec |
| By: | Dominique Finon (CIRED - Centre international de recherche sur l'environnement et le développement - [CIRAD : UMR56][CNRS : UMR8568] - [Ecole des Hautes Etudes en Sciences Sociales][Ecole Nationale des Ponts et Chaussées][Ecole Nationale du Génie Rural des Eaux et des Forêts]); Catherine Locatelli (LEPII - Laboratoire d'Economie de la Production et de l'Intégration Internationale - [CNRS : FRE2664] - [Université Pierre Mendès-France - Grenoble II]) |
| Abstract: | L'objet de ce papier est d'analyser la relation d'interdépendance de la Russie et de l'Union européenne dans le domaine gazier en dissociant le risque de pouvoir de marché du vendeur russe du problème de sécurité de court terme. L'objectif est de prendre la mesure du risque économique associé à la position dominante du vendeur russe sur le marché européen afin d'apprécier la pertinence des réponses qui peuvent lui être apportées par les Etats européens ou par l'Union européenne. |
| Keywords: | DEPENDANCE ENERGETIQUE ; MARCHE INTERNATIONAL ; GAZ NATUREL ; GAZPROM ; UNION EUROPEENNE ; RUSSIE |
| Date: | 2006–12–11 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00119602_v1&r=eec |
| By: | Jalal EL OUARDIGHI; Rabija SOMUN-KAPETANOVIC |
| Abstract: | Cet article examine l’évolution des inégalités des activités de production (PIB par habitant) et de technologie (Brevets par habitant) de 32 pays européens sur la période 1989-2002. La mesure de Theil est utilisée comme indicateur des inégalités. Elle est définie comme la somme des contributions de chaque pays à l’inégalité internationale. L’étude du processus de convergence/divergence des activités de production utilise le cadre théorique sur la convergence des économies. Cependant, par rapport à l’approche classique, l’originalité de notre démarche repose sur la modélisation des contributions aux inégalités globales du revenu. Les principaux facteurs explicatifs retenus sont les contributions aux inégalités technologiques internationales. L’hétérogénéité des comportements est mise en évidence via la vitesse de convergence. Cette dernière est mise en relation avec des spécificités nationales. Les résultats des estimations du modèle non-conditionnel indiquent une faible convergence des contributions aux inégalités : -0.2%, 0.2% et 0.1% respectivement dans le cadre de l’UE-15, l’UE- 25 et l’UE-32. Les résultats d’estimation du modèle conditionnel ne remettent pas en cause la faible vitesse de convergence des inégalités. Ils montrent cependant que l’effet des inégalités technologiques est significatif et il dépend du niveau de richesse des pays. Ainsi, les pays dont le PIB par habitant est important contribuent positivement aux inégalités internationales du revenu durant leur développement technologique. La prise en compte de l’hétérogénéité des comportements à travers le paramètre de convergence suggère que la vitesse de convergence est variable selon les pays. Les capacités technologiques apparaissent comme un facteur d’accélération : les pays à faibles capacités technologiques convergent moins vite que ceux à forte densité technologique. Ainsi, dans le cadre de l’UE-15, les vitesses varient entre 5.6% en Allemagne et -2.1% au Luxembourg. Elles sont moins élevées en considérant l’UE-25 et l’UE- 32 où les vitesses sont de l’ordre de 2.1% et 1.6% (en Allemagne), -1.5% et -1.8% (à Chypre) respectivement. |
| Keywords: | Inégalité du revenu, Inégalité technologique, Convergence, données de Panel, Pays européens. |
| JEL: | C23 O40 O52 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2006-19&r=eec |
| By: | Carole Brunet (GATE - Groupe d'analyse et de théorie économique - [CNRS : UMR5824] - [Université Lumière - Lyon II] - [Ecole Normale Supérieure Lettres et Sciences Humaines]); Andrew Clark (DELTA - Département et Laboratoire d'Economie Théorique et Appliquée - [CNRS : UMR8545] - [Ecole Normale Supérieure de Paris][Ecole des Hautes Etudes en Sciences Sociales]); Jean-Yves Lesueur (GATE - Groupe d'analyse et de théorie économique - [CNRS : UMR5824] - [Université Lumière - Lyon II] - [Ecole Normale Supérieure Lettres et Sciences Humaines]) |
| Abstract: | Des études sur données agrégées ont mis en évidence une corrélation positive entre le taux de propriétaires et le taux de chômage en Europe et aux Etats-Unis. Ce fait stylisé a donné lieu à de nombreux travaux économétriques sur données individuelles américaines, danoises ou anglaises, plus rarement sur données françaises, qui ont conduit à des résultats contradictoires. L'étude économétrique proposée dans cet article s'inscrit dans cette réflexion en proposant une analyse comparée sur données individuelles britanniques et françaises des effets du statut résidentiel sur la durée des épisodes de chômage. L'influence des différents modes d'occupation du logement sur la durée de séjour dans l'état de chômage est estimée pour la France à partir du Panel Européen des Ménages et pour la Grande-Bretagne à partir du British Household Panel Survey. On contrôle lors des estimations les sources de biais relevant de la censure, de l'auto sélection et des sources d'hétérogénéité inobservable. Les résultats économétriques font apparaître des effets très discriminants entre les deux pays. Si la propension à la propriété immobilière augmente la durée de chômage en France, elle n'induit en revanche aucun effet statistiquement significatif en Angleterre, les accédants à la propriété manifestant<br />même, toutes choses égales par ailleurs, les durées de chômage les plus basses. En Grande-Bretagne, ce sont plutôt les locataires du secteur social qui manifestent les durées de chômage les plus longues, résultat qui ne réfute pas l'observation faite dans d'autres études d'une plus faible mobilité des locataires du secteur social par rapport aux locataires du secteur privé. |
| Keywords: | Durée de chômage, statut résidentiel, mobilité |
| Date: | 2006–12–06 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00118751_v1&r=eec |
| By: | Edith Archambault |
| Abstract: | In France, like in other Western European countries, the third sector has been on a steady increase during the last decade as the results of the Johns Hopkins comparative project shows it. Today nonprofit organisations play also an increasing role in labour market policies. In a country with a corporatist welfare state, the access to the labour-market represents the key for social rights. |
| Keywords: | nonprofit sector; labour market policies; welfare mix; corporatist welfare state; cross-country comparison |
| Date: | 2006–12–12 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00120005_v1&r=eec |
| By: | Aurelijus Dabušinskas; Martti Randveer |
| Abstract: | In this paper, we review the price setting survey of Estonian firms and compare our findings with the results of similar research in the euro area summarized by Fabiani et al. (2005). Generally, the price setting patterns that emerge from our survey are quite similar to those in the euro zone. There is some evidence, however, that price setting may be somewhat more flexible in Estonia. The findings that suggest more price flexibility in Estonia are as follows: the incidence of time-dependent pricing is lower, the share of firms that are price takers is larger, price changes are more frequent, and, finally, the speed of price adjustments to shocks is higher |
| Keywords: | price setting, nominal rigity, inflation persistence, price survey |
| JEL: | E30 D40 |
| Date: | 2006–12–10 |
| URL: | http://d.repec.org/n?u=RePEc:eea:boewps:wp2006-08&r=eec |
| By: | Deborah Schöller (Universität Hohenheim) |
| Abstract: | Besides material offshoring, economists have started to analyze the impact of service offshoring on domestic employment. Services are of particular interest since their significance has grown not only in terms of quantity, but also of qualitative understanding. One decade ago, most services were considered non-tradable, but the appearance of new information and communication technologies has contributed to overcoming geographical distance. The introduction of the paper aims at giving an appropriate definition of service offshoring also taking into account the different motives behind offshoring. The theoretical part gives a brief literature overview of the predicted effects of offshoring on domestic employment. The empirical part first compares import data of computing and information as well as other business services and states that service offshoring is more relevant in Germany than in most other countries. Secondly, German service offshoring intensities are calculated on a sectoral basis using input-output data. This measurement represents the proportion of imported service inputs used in home production. Germany’s average service offshoring intensity more than doubled from 1991 to 2002. Besides this, indications for a possible negative correlation between German service offshoring and manufacturing employment are given. Thirdly, the impact of service offshoring on German domestic manufacturing employment is estimated at a sectoral level. The author refers to the labor demand specification of Hamermesh using sectoral wages, output and other input prices as exogenous variables. The estimation results indicate that service offshoring was negatively related to manufacturing employment in Germany between 1991 and 2000. |
| Keywords: | Service Offshoring, Employment, Globalization |
| JEL: | F1 F2 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:old:wpaper:y:2006:i:23:p:1-44&r=eec |
| By: | Maria Savona; André Lorentz |
| Abstract: | The paper provides fresh empirical evidence on the relative role of changes in final and intermediate demand as affecting the changes in the sectoral structure of advanced economies. These latter have led, over the last three decades, to the massive growth of service sectors. The paper draws upon the recently released OECD Input- Output (I-O) tables. The empirical analysis is based on an I-O Structural Decomposition Analysis carried out on 13 manufacturing and service sectors, from the end of 1960s to the end of 1990s. Although heterogeneous sectoral patterns emerge, we find that the structural changes leading to the growth of services, particularly KIBS (Knowledge Intensive Business Services), are mainly (domestic) demand-led, whereas the role of foreign trade remains marginal even in the last decade. We infer that, even in the case of the most technologically advanced service sectors, (domestic) demand constraints affect the degree of exploitation of technological opportunities and the patterns of growth. |
| Keywords: | Structural change, Growth of Services, Input–Output. |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2006-01&r=eec |
| By: | Davis, Steven J. (The University of Chicago Graduate School of Business); Henrekson, Magnus (Dept. of Economics, Stockholm School of Economics) |
| Abstract: | Abstract: Following a severe contraction in the early 1990s, the Swedish economy accumulated a strong record of output growth coupled with a disappointing performance in the labor market. As of 2005, hours worked per person 20–64 years of age are 10.5 percent below the 1990 peak and a mere one percent above the 1993 trough. Employment rates tell a similar story. Our explanation for Sweden’s weak performance with respect to market work activity highlights the role of high tax rates on labor income and consumption expenditures, wage-setting arrangements that compress relative wages, business tax policies that disfavor labor-intensive industries and technologies, and a variety of policies and institutional arrangements that disadvantage younger and smaller businesses. This last category includes tax policies that penalize wealth accumulation in the form of owner-operated businesses, a pension system that steers equity capital and loanable funds to large incumbent corporations, and legally mandated job-security provisions that weigh more heavily on smaller and younger businesses. We describe these features of the Swedish institutional setup and provide evidence of their consequences based largely on international comparisons. |
| Keywords: | Business taxation; Industry structure; Swedish economic performance; Tax effects; Time allocation; Wage-setting institutions; Work activity |
| JEL: | D13 H30 J20 L52 O52 |
| Date: | 2006–12–08 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:hastef:0647&r=eec |
| By: | Davide Castellani (University of Urbino,Italy.); Ilaria Mariotti (DIG-Polytechnic University of Milano, Italy.); Lucia Piscitello (DIG-Polytechnic University of Milano, Italy.) |
| Abstract: | The present paper investigates the effect of outward investments by Italian manufacturing firms on the domestic employment level and on its skill composition, as measured by the increase in the aggregate share of skilled workers (managers and clerks) in total employment. In doing so, the paper extends the existing empirical literature on the Italian case that has so far provided evidence on the changes in the employment intensity but not on the composition of the domestic employment. We carry out an analysis at the firm level based on the the behaviour of 108 Italian firms, which became multinational for the first time in 1998-2003, investing in either developed countries, CEECs or other developing economies, compared with the behaviour of a counterfactual group of firms constituted by 2,500 national firms that never invested abroad in the considered period. The econometric analysis supports that the internationalisation of activities by manufacturing firms does not reduce their domestic employment, independently of the destination of the investment, and that it may change the division of labour within the firm, thus leading to a higher share of skilled labour intensive activities, especially as a result of investments in CEECs. |
| Keywords: | Foreign direct investment, Employment, Skill-upgrading. |
| JEL: | F2 J21 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:cri:cespri:wp185&r=eec |
| By: | Ágeir Daníelsson; Lúdvík Elíasson; Magnús F. Gudmundsson; Björn A. Hauksson; Ragnhildur Jónsdóttir; Thorvardur Tjörvi Ólafsson; Thórarinn G. Pétursson |
| Abstract: | This paper documents and describes the new Quarterly Macroeconomi Model of the Central Bank of Iceland (qmm). qmm and the underlying quar terly database have been under construction since 2001 at the Research and Forecasting Division of the Economics Department at the Bank. qmm is used by the Bank for forecasting and various policy simulations and therefore play a key role as an organisational framework for viewing the medium-term futur when formulating monetary policy at the Bank. This paper is mainly focused on the short and medium-term properties of qmm. Analysis of the steady state properties of the model are currently under way and will be reported in a separate paper in the near future. |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:ice:wpaper:wp32&r=eec |