nep-hme New Economics Papers
on Heterodox Microeconomics
Issue of 2011‒11‒01
forty-five papers chosen by
Frederic S. Lee
University of Missouri-Kansas City

  1. A Critique and Reframing of Personality in Labour Market Theory: Locus of Control and Labour Market Outcomes By Eileen Trzcinski; Elke Holst
  2. Foley's Thesis, Negishi's Method, Existence Proofs and Computation By K. Vela Velupillai
  3. The Trend over Time of the Gender Wage Gap in Italy By Chiara MUSSIDA; Matteo PICCHIO
  4. Studying after the degree: new pathways shaped by old inequalities. Evidence from Italy, 1995-2007 By Gianluca Argentin
  5. Downward wage rigidity in Hungary By Gábor Kátay
  6. Economic thinking and ethics: an ethical approach for economical issues By Thieme, Sebastian
  7. Freedom, Anarchy and Conformism in Academic Research By K. Vela Velupillai
  8. The Rights of Children, Youth and Women in the Context of Migration By Victor Abramovich; Pablo Ceriani Cernadas; Alejandro Morlachetti
  9. The Old Boy Network: Gender Differences in the Impact of Social Networks on Remuneration in Top Executive Jobs By Lalanne, Marie; Seabright, Paul
  10. Gender issues and inequality in higher education outcomes under post-communism By Peter Robert; Annamária Gáti
  11. The Gender Wage Gap among recent European Graduates By Moris Triventi
  12. Transition from High Education to the Labour Market: Unemployment within Graduates from the Gender Prospective In the Palestinian Territory By Saleh Alkafri
  13. Lifetime Earnings Inequality in Germany By Bönke, Timm; Corneo, Giacomo; Lüthen, Holger
  14. Behavioural Economics: Classical and Modern By Selda (Ying Fang) Kao; K. Vela Velupillai
  15. Integration and Contagion in US Housing Markets By John Cotter; Stuart Gabriel; Richard Roll
  16. Innovation Policy Design: Identification of Systemic Problems By Edquist, Charles
  17. Earnings Dynamics of Men and Women in Finland: Permanent Inequality versus Earnings Instability By Kässi, Otto
  18. Minimum Wage Increases Under Straightened Circumstances By Addison, John T.; Blackburn, McKinley L.; Cotti, Chad
  19. EU Competition Policy Revisited: Economic Doctrines Within European Political Work By Matthieu MONTALBAN (GREThA, CNRS, UMR 5113); Sigfrido RAMIREZ-PEREZ (Università Bocconi); Andy SMITH (Centre Emile Durkheim - IEP-Bordeaux)
  20. The Fundamental Theorems of Welfare Economics, DSGE and the Theory of Policy - Computable & Constructive Foundations By K. Vela Velupillai
  21. Transparency without Accountability By Mwangi wa Githinji; Frank Holmquist
  22. Understanding the Determinants of Female Labor Force Participation in the Middle East and North Africa Region: The Role of Education and Social Norms in Amman By Nadereh Chamlou; Silvia Muzi; Hanane Ahmed
  23. Development of competition indicators in the Norwegian general practice: Constructing a postal code-specific Herfindahl-Hirschman index applying STATA software By Chen, Xing; Godager, Geir
  24. Multi-level innovation policy in southern EU countries.An additionality evaluation of the Italian and Spanish public interventions By Alberto Marzucchi
  25. A Bayesian Analysis of Female Wage Dynamics Using Markov Chain Clustering By Christoph Pamminger; Regina Tüchler
  26. L’économie de l’enseignement supérieur et de la recherche. De la nécessité de marcher sur ses deux jambes . By Gaffard, Jean-Luc
  27. Price expectations and price dynamics: the case of the rice sector in developing Asia By Thomas Barré
  28. Religious Schooling, Secular Schooling, and Household Income Inequality in Israel By Ayal Kimhi; Moran Sandel
  29. Political Reservations, Access to Water and Welfare Outcomes: Evidence from Indian Villages By Raghbendra Jha; Sharmistha Nag; Hari K. Nagarajan
  30. The reasons of scientists mobility: results from the comparison of outgoing and ingoing fluxes of researchers in Italy By M.Carolina Brandi; Sveva Avveduto; Loredana Cerbara
  31. une justice environnementale européenne : le cas de la précarité énergétique. By Laurent, Eloi
  32. Microfinance Non-Financial Services: A Key for Poverty Alleviation? Lessons from Mexico By Olga Biosca; Pamela Lenton; Paul Mosley
  33. Economics and psychology.Perfect rationality versus bounded rationality By Schilirò , Daniele
  34. Personnel policies in the European firms: some evidence of the existing model(s) and the potential role of Corporate Universities. By Giulio Pedrini
  35. India's Gender Bias in Child Population, Female Education and Growing Prosperity: 1951–2011 with Projections to 2026 By D.P. Chaudhri; Raghbendra Jha
  36. Spite and Cognitive Skills in Preschoolers By Elisabeth Bügelmayer; C. Katharina Spieß
  37. Credit availability and the collapse of the banking sector in the 1930s By Mark A. Carlson; Jonathan D. Rose
  38. 20 ans après, que reste-t-il de l'économie des conventions ? Points de départ pour une contribution à un institutionnalisme unifié By Hervé Charmettant; Michel Rocca
  39. The Japanese Financial Sector's Transition from High Growth to the‘Lost Decades':A Market Economy Perspective By Wataru Takahashi
  40. A Multidimensional Approach to Measuring Child Poverty By Sharmila Kurukulasuriya; Solrun Engilbertsdottir
  41. Culture, Intermarriage, and Differentials in Second-Generation Immigrant Women's Labor Supply By Gevrek, Z. Eylem; Gevrek, Deniz; Gupta, Sonam
  42. Global Inequality: Beyond the Bottom Billion – A Rapid Review of Income Distribution in 141 Countries By Isabel Ortiz; Matthew Cummins
  43. Austerity Measures Threaten Children and Poor Households: Recent Evidence in Public Expenditures from 128 Developing Countries By Isabel Ortiz; Matthew Cummins
  44. Intrahousehold Distribution and Child Poverty: Theory and Evidence from Côte d’Ivoire By Bargain, Olivier; Donni, Olivier; Kwenda, Prudence
  45. Application of Chaotic Number Generators in Econophysics By Carmen Pellicer-Lostao; Ricardo Lopez-Ruiz

  1. By: Eileen Trzcinski; Elke Holst
    Abstract: This article critically examines the theoretical arguments that underlie the literature linking personality traits to economic outcomes and provides empirical evidence indicating that labour market outcomes influence personality outcomes. Based on data from the German Socio-Economic Panel, we investigated the extent to which gender differences occur in the processes by which highly positive and negative labour market outcomes are determined and in the processes underlying the development of one particular aspect of personality, locus of control. Gender differences were more pronounced in the results for years in managerial/ leadership positions than for locus of control. Negative labour market states were also marked by gender differences. We conclude by arguing that an explicitly value-laden analysis of the rewards associated with personality within the labour market could expose areas where the gendered nature of rewards by personality serves to perpetuate power relationships within the labour market.
    Date: 2011
  2. By: K. Vela Velupillai
    Abstract: Duncan Foleyís many-faceted and outstanding contributions to macroeconomics, microeconomics, general equilibrium theory, the theory of taxation, history of economic thought, the magnificent dynamics of classical economics, classical value theory, Bayesian statistics, formal dynamics and, most recently, fascinating forays into an interpretation of economic evolution from a variety of complexity theoretic viewpoints have all left -and continue to leave - significant marks in the development and structure of economic theory. He belongs to the grand tradition of visionaries who theorise with imaginative audacity on the dynamics, evolution and contradictions of capitalist economies - a tradition that, perhaps, begins with Marx and Mill, continues with Keynes and Schumpeter, reaching new heights with the iconoclastic brilliancies of a Tsuru and a Goodwin, a Chakravarty and a Nelson, and to which Duncan Foley adds a lustre of much value. In this contribution I return to mathematical themes broached in Foleyís brilliant and pioneering Yale doctoral dissertation (Foley, 1967) and attempt to view them as a Computable Economist would.The intention is to suggest that algorithmic indeterminacies are intrinsic to the foundations of economic theory in the mathematical mode
    Keywords: Equilibrium existence theorems, Welfare theorems, Constructive proofs, Computability
    JEL: C02 C63 D58 E17
    Date: 2011
  3. By: Chiara MUSSIDA (Department of Economics and Social Sciences, Università Cattolica del Sacro Cuore, Piacenza, Italy); Matteo PICCHIO (Department of Economics, CentER, ReflecT, Tilburg University, The Netherlands and IZA, Germany)
    Abstract: We analyse gender wage inequalities in Italy in the mid-1990s and in the mid-2000s. In this period important labour market developments occurred: institutional changes have loosened the use of flexible and atypical contracts; the female employment rates and educational levels have substantially increased. We identify the time trends of different components of the gender wage gap by estimating wage distributions in the presence of covariates and sample selection and by counterfactual microsimulations. We find that women swam against the tide: whilst the trend in female qualifications slightly reduced the gender wage gap, the gender relative trends in the wage structure significantly increased it.
    Keywords: gender wage gap, counterfactual distributions, decompositions, hazard function, labour market reforms
    JEL: C21 C41 J16 J31 J71
    Date: 2011–08–17
  4. By: Gianluca Argentin (University of Milan-Bicocca)
    Abstract: In recent years in Italy, there has been a fast increase in the number of young people graduating with a tertiary degree and a sharp change in the composition of this population by gender, social origins and the field of study. Since the middle of the 90s, we have also detected a growth in the enrolment in post-tertiary education, but this is not the result of the compositional change which has occurred among graduates across cohorts. Instead, it seems mainly due to the increased offer of training and academic opportunities to the graduates: a new educational level emerged while the graduates’ rate was increasing. Until now, this new form of educational stratification has not been considered by sociological research, even if it could lead to new forms of inequality. In our paper, we primarily test the credentialist hypothesis, looking at the strength of the association between social origins and post-tertiary education among recent graduates’ cohorts. Following the credentialist theory, graduates coming from higher-educated families would be more involved in the new educational level, to maintain their advantage in the labour market, where they can take advantage of their higher credentials. Then we look at gender: we investigate whether this second ascriptive dimension plays a role in shaping enrolment at post-tertiary level. Our analyses, based on the best data available in Italy on this topic, support the credentialist hypothesis: higher social origins are associated with a greater propensity to enrol at post-tertiary education and training. Moreover, graduates coming from more educated families participated more frequently in the more institutionalized forms of post-tertiary education, the ones leading to a professional qualification. Contrary to this, gender seems not to play an influential role: the female advantage is weak and limited to the less institutionalized forms of post-tertiary education/training; moreover it almost disappears considering academic performance and horizontal stratification of upper school and university.
    Date: 2011–10
  5. By: Gábor Kátay (Magyar Nemzeti Bank (central bank of Hungary))
    Abstract: Following the approach recently developed for the International Wage Flexibility Project (IWFP), the paper presents new estimates of downward real and nominal wage rigidity for Hungary. Results suggest that nominal rigidity is more prominent in Hungary than real rigidity. When compared to other countries participating in the IWFP, Hungary ranks among the countries with the lowest degree of downward real rigidity. The estimated downward nominal rigidity for Hungary is higher, the measure is close to but still below the overall cross-country average. Using the same methodology, the paper also confirms the widespread view that the wage growth bargained at the national level has little compulsory power in Hungary. On the other hand, the minimum wage remains an important source of potential downward wage rigidity in Hungary.
    Keywords: downward nominal and real wage rigidity, wage change distributions, wage flexibility
    JEL: C23 E24 J3 J5
    Date: 2011
  6. By: Thieme, Sebastian
    Abstract: The worldwide economic crisis of 2007/2008 popularised the ethical questions within economics. Currently, few mainstream economists tackle these questions and the typical curriculum of economics often lacks input on philosophy, ethics and the history of economic thoughts. However, economists confronted with ethical questions believe themeslves capable of answering them. As a result, the popular discussion about ethics and economics becomes a discussion about regulations. In contrast to that, in the context of the “Economics and Ethics” discussion in Germany, the article shows an alternative approach, which concentrates on the question of why something is to be labelled as “moral”. On the base of Peter Ulrich's integrative economic ethics, the relevance of the right of subsistence on the ethical legitimacy of economic decisions, recommendations etc. is explained. The insights are discussed with respect to labour market theories and the German labour market reforms of 2005. Finally, the question of ethical legitimation is connected to the question of democracy and economics.
    Keywords: Peter Ulrich; integrative economic ethics; discourse; ethical legitimation; Karl Polanyi; Subsistence; Viablity; Right of Subsistence
    JEL: B52 P48 B59 Z13 B00
    Date: 2011–10–25
  7. By: K. Vela Velupillai
    Abstract: In this paper I attempt to make a case for promoting the courage of rebels within the citadels of orthodoxy in academic research environments. Wicksell in Macroeconomics, Brouwer in the Foundations of Mathematics, Turing in Computability Theory, Sraffa in the Theories of Value and Distribution are, in my own fields of research, paradigmatic examples of rebels, adventurers and non-conformists of the highest caliber in scientific research within University environments. In what sense, and how, can such rebels, adventurers and non-conformists be fostered in the current University research environment dominated by the cult of 'picking winners'? This is the motivational question lying behind the historical outlines of the work of Brouwer, Hilbert, Bishop, Veronese, Gödel, Turing and Sraffa that I describe in this paper. The debate between freedom in research and teaching, and the naked imposition of 'correct' thinking, on potential dissenters of the mind, is of serious concern in this age of austerity of material facilities. It is a debate that has occupied some of the finest minds working at the deepest levels of foundational issues in mathematics, metamathematics and economic theory. By making some of the issues explicit, I hope it is possible to encourage dissenters to remain courageous in the face of current dogmas
    Keywords: Non-conformist research, economic theory, mathematical economics, 'Hilbert's Dogma', Hilbert's Program, computability theory
    Date: 2011
  8. By: Victor Abramovich (Centre of Human Rights – University of Lanus); Pablo Ceriani Cernadas (Centre of Human Rights – University of Lanus); Alejandro Morlachetti (Centre of Human Rights – University of Lanus)
    Abstract: This paper is an updated version of a previous draft working paper entitled, "Migration, Children and Human Rights: Challenges and Opportunities". This paper aims to address the issue of children’s and women’s migration from a human rights perspective by highlighting: (i) the particular situation of children and adolescents within the migration-development nexus, (ii) the gender perspective at all stages of analysis and programming and (iii) the significant gaps within legislation and policies, that inhibit the formulation of effective and rights-based responses relating to children, adolescents and migration.
    Keywords: children’s and women’s migration, human rights,children's rights, adolescents and migration, equity,
    Date: 2011
  9. By: Lalanne, Marie; Seabright, Paul
    Abstract: Using an original dataset describing the career history of some 16,000 senior executives and members of the non-executive board of US, UK, French and German companies, we investigate gender differences in the use of social networks and their impact on earnings. There is a large gender wage gap: women (who make up 8.8% of our sample) earned average salaries of $168,000 in 2008, only 70% of the average $241,000 earned by men. This is not due to differences in age, experience or education levels. Women are more likely than men to be non-executives, whose salaries are lower; nevertheless, a substantial gender gap still exists among executives. We construct measures of the number of currently influential people each individual has encountered previously in his or her career. We find that executive men's salaries are an increasing function of the number of such individuals they have encountered in the past while women's are not. Controlling for this discrepancy, there is no longer a significant gender gap among executives. These findings are robust to the use of different years, to the use of salaried versus non-salaried remuneration, and to the use of panel estimation to control rigorously for unobserved individual heterogeneity. In contrast to executives, the salaries of non-executive board members do not display a significant gender wage gap, nor any gender difference in the effectiveness with which men and women leverage their links into salaries. This suggests that adoption of gender quotas for board membership, as has been enacted or proposed recently in several European countries, is unlikely to reduce the gender gap in earnings so long as such quotas do not distinguish between executive and non-executive board members.
    Keywords: executive compensation; gender wage gap; social networks
    JEL: A14 J16 J31 J33
    Date: 2011–10
  10. By: Peter Robert (TÁRKI); Annamária Gáti (TÁRKI-TUDOK)
    Abstract: The paper intends to increase the information and knowledge on graduates’ labour market entry and early career under post-communism. The specific purpose of the analysis is to examine gender differences with respect to two particular research questions: the length of time graduates need to enter the labour force and find a first job; the odds for becoming unemployed during the first five years spent in labour force. Data from the recent HEGESCO project ( are employed in the paper. The data collection has occurred in 2008 / 2009 and refers to those diploma holders who completed their studies five years earlier in 2002 / 2003. The project involved five nations: Hungary, Lithuania, Poland, Slovenia and Turkey. The present study deals with three former communist countries: Hungary (N=1533), Poland (N=1200) and Slovenia (N=2923). The paper provides background information on these three countries in terms of their institutional features related to the school system and the labour market. Both descriptive (bivariate) and causal (multivariate) techniques are applied in the study. The Kaplan-Meier survival analysis is used to examine gender differences in labour market entry in the three countries. For investigating the determinants of possible unemployment experience (did it occur or not), the logistic regression method is applied. In addition to gender variation, data offer a large variety of predictors and control variables informing about various characteristics of the study program (field of study, BA/MA, full-time / part-time, first degree gained) as well as about the respondent’s involvement during studies (voluntary / student organization activity, internship, work experience). It is also possible to control for social origin (parental education). Results reveal that gender difference for the length of time to find a first job is significantly present only in Slovenia. For unemployment, at observed level women are definitely disadvantaged and experienced unemployment in all three countries more frequently as compared to men. On the ground of the multivariate analysis, however, the female disadvantage to have a significantly bigger chance to become unemployed in comparison to males turns out to be present only in Poland. As taking into account the large variation in the compositional effects, the paper elaborates on how these features bring advantages or disadvantages for males and females to avoid unemployment. On this ground it is impossible to conclude about a better or worse situation regarding the rank order of the three countries.
    Date: 2011–09
  11. By: Moris Triventi (Department of Sociology and social research University of Milano-Bicocca)
    Abstract: The aim of this paper is to examine whether there is a gender gap in monthly wage among recent graduates in eleven European countries and which variables can explain it. In the first part of the paper previous literature is presented and some limitations of existing studies are discussed. In the theoretical framework the gender wage gap is conceived as a function of five main factors: human capital, employment characteristics, working hours, work-family conciliation aspects and residual discrimination. Different types of decomposition after OLS linear regression and Heckman selection models are applied; data comes from REFLEX survey on tertiary graduates in 2000. The main results indicate that the raw gender gap is higher in Austria and Germany, while it is lower in Belgium and United Kingdom, with Southern and Nordic countries placed in the middle. There is great variability in the unexplained part of the gender gap, which is mainly imputable to residual discrimination. This is low in Nordic countries, followed by Continental and Southern Europe. Overall the most important factors accounting for the gender gap are employment characteristics, followed by working hours. Human capital, work-family conciliation issues and individuals’ preferences matter in most countries, but their role is not prominent. There is also evidence of a correlation between several macro-institutional indicators (type of wage-setting institutions and welfare policies) and the extent of the gender gap, suggesting that wage determination is deeply rooted into institutional contexts.
    Date: 2011–09
  12. By: Saleh Alkafri (Palestinian Central Bureau of Statistics)
    Abstract: Theories and studies indicate that education is an essential factor to reduce the probability and unemployment duration and increase chances for business continuity and stability in a decent job. Nonetheless, what happens to women in many countries of the Middle East and North Africa is just the opposite, specifically in the Palestinian Territories, where the participation of women in the labour market is very low and significantly high rates of unemployment are witnessed. Results indicate that the more the years of education among women the higher the unemployment rate, unlike men, causing a significant gap between both sexes. Then comes the question repeated in all seminars, workshops and conferences, of why women face low possibilities of getting a job when they decide to enter the labour market, especially those young and highly educated? This is the basic problem that this research study tries to tackle through highlighting and identifying the factors affecting the low potential of graduate women in entering the labour market unlike graduate males despite their achievements in education. We have used recent data of the results of Labour Force Quarterly Survey 1996-2008 (total Quarterly sample size for each year is 7600 households), using high technology in the methodology for rotating the sample and the personnel follow-up for the four quarters during a year and a half which provides a meticulous study of the situation. A survey of graduates in the labour market 2006 was also used, which in turn provides a rich base of indicators that support the search results. It should be noted that the methodology came in twofold, the first, a descriptive analysis of the available data, and the second by using the Transition Probability Matrix and analysis of the Probit Regression model. The results confirm the existence of the problem, and relate the reasons to the limitations that restrict the movement of women to get jobs. Moreover, it shows that the problem of unemployment among graduates is highlighted in specific areas and disciplines that do not match the requirements of the market, as well as the employers’ point of view of occupations and activities that women can exercise. Delays in obtaining work, often lead women out of the labour market which in turn causes their low participation in the workforce. The general trend in the future puts in front of the Palestinian decision-maker extraordinary challenges to provide opportunities for jobs that take into account the geographical distribution and the programming of scientific disciplines offered by universities.
    Date: 2011–09
  13. By: Bönke, Timm (Free University of Berlin); Corneo, Giacomo (Free University of Berlin); Lüthen, Holger (DIW Berlin)
    Abstract: This paper documents the magnitude, pattern, and evolution of lifetime earnings inequality in Germany. Based on a large sample of earning biographies from social security records, we show that the intra-generational distribution of lifetime earnings of male workers has a Gini coefficient around .2 for cohorts born in the late 1930s and early 1940s; this amounts to about 2/3 of the value of the Gini coefficient of annual earnings. Within cohorts, mobility in the distribution of yearly earnings is substantial at the beginning of the lifecycle, decreases afterwards and virtually vanishes after age forty. Earnings data for thirty-one cohorts reveals striking evidence of a secular rise of intra-generational inequality in lifetime earnings: West-German men born in the early 1960s are likely to experience about 80 % more lifetime inequality than their fathers. In contrast, both short-term and long-term intra-generational mobility have been rather stable. Longer unemployment spells of workers at the bottom of the distribution of younger cohorts contribute to explain 30 to 40 % of the overall increase in lifetime earnings inequality.
    Keywords: lifetime earnings, earnings distribution, inequality, mobility, Germany
    JEL: D31 D33 H24
    Date: 2011–10
  14. By: Selda (Ying Fang) Kao; K. Vela Velupillai
    Abstract: In this paper, the origins and development of behavioural economics, beginning with the pioneering works of Herbert Simon (1953) and Ward Edwards (1954), is traced, described and (critically) discussed, in some detail. Two kinds of behavioural economics – classical and modern – are attributed, respectively, to the two pioneers. The mathematical foundations of classical behavioural economics is identified, largely, to be in the theory of computation and computational complexity; the corresponding mathematical basis for modern behavioural economics is, on the other hand, claimed to be a notion of subjective probability (at least at its origins in the works of Ward Edwards). The economic theories of behavior, challenging various aspects of 'orthodox' theory, were decisively influenced by these two mathematical underpinnings of the two theories
    Keywords: Classical Behavioural Economics, Modern Behavioural Economics, Subjective Probability, Model of Computation, Computational Complexity. Subjective Expected Utility
    JEL: C61 C63 D81 D83
    Date: 2011
  15. By: John Cotter; Stuart Gabriel; Richard Roll
    Abstract: This paper explores integration and contagion among US metropolitan housing markets. The analysis applies Federal Housing Finance Agency (FHFA) house price repeat sales indexes from 384 metropolitan areas to estimate a multi-factor model of U.S. housing market integration. It then identifies statistical jumps in metropolitan house price returns as well as MSA contemporaneous and lagged jump correlations. Finally, the paper evaluates contagion in housing markets via parametric assessment of MSA house price spatial dynamics. A R-squared measure reveals an upward trend in MSA housing market integration over the 2000s to approximately .83 in 2010. Among California MSAs, the trend was especially pronounced, as average integration increased from about .55 in 1997 to close to .95 in 2008! The 2000s bubble period similarly was characterized by elevated incidence of statistical jumps in housing returns. Again, jump incidence and MSA jump correlations were especially high in California. Analysis of contagion among California markets indicates that house price returns in San Francisco often led those of surrounding communities; in contrast, southern California MSA house price returns appeared to move largely in lock step. The high levels of housing market integration evidenced in the analysis suggest limited investor opportunity to diversify away MSA-specific housing risk. Further, results suggest that macro and policy shocks propagate through a large number of MSA housing markets. Research findings are relevant to all market participants, including institutional investors in MBS as well as those who regulate housing, the housing GSEs, mortgage lenders, and related financial institutions.
    Date: 2011–10
  16. By: Edquist, Charles (CIRCLE, Lund University)
    Abstract: ‘Activities’ in innovation systems are the determinants of the development and diffusion of innovations. Examples are R&D, provision of organizations and institutions, financing of innovations, incubation, etc. These activities are partly performed by private organizations and partly by public organizations, the latter performing tasks that constitute innovation policy. As a basis for innovation policy, the problems (failures) in the systems must be identified. This paper focuses upon the design of innovation policy through diagnostic analysis; it provides a framework for identification of systemic problems (or failures) in innovation systems.
    Keywords: Innovations systems; innovation policy
    JEL: O30
    Date: 2011–10–21
  17. By: Kässi, Otto
    Abstract: I decompose the variance of earnings of Finnish male and female workers to its permanent and transitory components and study their evolution between the years 1998 and 2007. I find that the increasing earnings inequality of men and women is driven by both transitory and permanent components of earnings. In addition, I find considerable differences in earnings dynamics between men and women that have been largely neglected in previous studies of earnings dynamics. The inequality among men is dominated by the permanent component. Conversely, permanent and transitory components are of comparable magnitudes to women. As a corollary, men face more stable income paths but with larger permanent earnings differences. Women, on the other hand, face more instable earnings profiles but have smaller permanent differences in earnings. The correlation between initial earnings inequality and the growth in earnings inequality is found to be positive for both sexes, implying a divergence of earnings profiles towards end of the working career. In addition, earnings instability has risen for both sexes.
    Keywords: Earnings distribution; earnings dynamics; permanent inequality; transitory inequality; variance decomposition
    JEL: J62 J31
    Date: 2011–10
  18. By: Addison, John T. (University of South Carolina); Blackburn, McKinley L. (University of South Carolina); Cotti, Chad (University of Wisconsin, Oshkosh)
    Abstract: Do apparently large minimum wage increases in an environment of recession produce clearer evidence of disemployment effects than is typically observed in the new minimum wage literature? This paper augments the sparse literature on the most recent increases in the U.S. minimum wage, using three different data sets and the two main estimation strategies for handling geographically-disparate trends. The evidence is generally unsupportive of negative employment effects, still less of a 'recessionary multiplier.' Minimum wage workers seem to be concentrated in sectors of the economy for which the labor demand response to wage mandates is minimal.
    Keywords: minimum wages, disemployment, earnings, low-wage sectors, geographically-disparate employment trends, recession
    JEL: J2 J3 J4 J8
    Date: 2011–10
  19. By: Matthieu MONTALBAN (GREThA, CNRS, UMR 5113); Sigfrido RAMIREZ-PEREZ (Università Bocconi); Andy SMITH (Centre Emile Durkheim - IEP-Bordeaux)
    Abstract: European Union competition policy is often described as neoliberal, without this leading to more investigation. This paper highlights how the European Competition policy doctrine has been shaped, how the ordoliberal movement and the Chicago school ideas have been implemented and supported by the political work of some key actors. We show that, contrary to what is sometimes said in literature, ordoliberal actors were neither hegemonic nor leaders between Rome Treaty and the eighties, even if some neoliberal principles were introduced in antitrust law. These laws are much more a compromise between French and German representatives, and between neo-mercantilists and ordoliberals. However, things have dramatically changed since the eighties, when both (1) new political work from members of the Commission introduced in the European competition policy elements of Chicago School doctrine to complete the European market and (2) some decisions from the ECJ clarified the doctrine of EU Competition law. Nowadays, European competition policy is a mix between an ordoliberal spirit and some Chicago School doctrinal elements.
    Keywords: competition, policy, European Union, neoliberalism, ordoliberalism, political work
    JEL: L4 N4
    Date: 2011
  20. By: K. Vela Velupillai
    Abstract: The genesis and the path towards what has come to be called the DSGE model is traced, from its origins in the Arrow-Debreu General Equilibrium model (ADGE), via Scarf's Computable General Equilibrium model (CGE) and its applied version as Applied Computable General Equilibrium model (ACGE), to its ostensible dynamization as a Recursive Competitive Equilibrium (RCE). It is shown that these transformations of the ADGE - including the fountainhead - are computably and constructively untenable. The policy implications of these (negative) results, via the Fundamental Theorems of Welfare Economics in particular, and against the backdrop of the mathematical theory of economic policy in general, are also discussed (again from computable and constructive points of view). Suggestions for going 'beyond DSGE' are, then, outlined on the basis of a framework that is underpinned - from the outset - by computability and constructivity considerations
    Keywords: Computable General Equilibrium, Dynamic Stochastic General Equilibrium, Computability, Constructivity, Fundamental Theorems of Welfare Economics, Theory of Policy, Coupled Nonlinear Dynamic
    JEL: C02 C62 C68 D58 E61
    Date: 2011
  21. By: Mwangi wa Githinji (University of Massachusetts Amherst); Frank Holmquist (Hampshire College)
    Abstract: Kenya has been going through a period of political reform from 1991 when section 2A of the constitution that had made Kenya a de jure one party state was repealed. The reform followed a prolonged struggle by citizens both within and without the country. Their call for democracy was one that, post the fall of the Berlin wall, was embraced by western countries. Via diplomatic pressure and conditionality on aid, western donors played an important role in the repeal of section 2a, the return of multi-party elections and in the creation and reform of a number of political institutions and offices. In the main these changes were pushed by the donors and though supported by the opposition in Kenya they did not rise organically from the struggle over political power in Kenya. In this paper, we argue that although these reforms led to a heightened awareness of the ills of the political class, they failed to actually hold members of this class accountable for their transgressions. We argue that these institutions presupposed the existence of an electorate with an effective set of identities that belonged to the larger Kenyan nation. This broader construct of society did not exist. A history of economic and political inequality from the inception of modern Kenya had resulted in a divided population that was unable to exercise this mandate, and could ultimately discipline politicians when they failed. In actuality, since the politics was not based on broader Kenyan national interests but rather narrower personal interests construed as ethno-nationalist, the political class was not accountable to the larger Kenyan constituency. JEL Categories: O, P16, Z13
    Keywords: Political Economy, Ethnicity, Development, Corruption, Kenya
    Date: 2011–10
  22. By: Nadereh Chamlou (The World Bank); Silvia Muzi (The World Bank); Hanane Ahmed (The World Bank)
    Abstract: The similarities between the labor market supply of women with a Middle Eastern background living in Europe and those of women living in the Middle East is of particular interest. Indeed, empirical evidence shows that Female Labor Force Participation (FLFP) of immigrants reflects to a large extent the FLFP of country of origin, with women from more conservative societies tending to participate less in the labor market than natives or immigrants from countries with a high FLFP. This impacts the host country’s FLFP at an aggregate level. Therefore, from a European perspective, understanding the determinants of female labor supply in the conservative societies, such as countries from the Middle East and North Africa (MENA) region is of particular interest, considering the high share of this group among immigrants. Hence, this empirical research focuses on the role of education, especially higher education, and social norms in MENA on the choice of women to work outside. The region has achieved substantial progress in educating women, increasingly so at the tertiary level and across disciplines, but its FLFP remains the lowest among all regions. Our paper empirically investigates the impact of education with emphasis on higher education on FLFP and the relationship between social norms and female labor supply in a representative city in MENA, namely Amman, Jordan, as a proxy for MENA. Our analysis shows that higher education (post-secondary/university/post-university) has a positive and significant impact on FLFP, whereas secondary and below do not. In addition, there is a strong negative and statistically significant association between traditional social norms and the participation of women in the labor force. The findings pose the question of whether additional policies and actions are needed to change institutions and attitudes toward women’s work in general, as well as improve the economic opportunities of women who have secondary education which affects the bulk of working age women.
    Date: 2011–09
  23. By: Chen, Xing (Department of Health Management and Health Economics); Godager, Geir (Department of Health Management and Health Economics)
    Abstract: The purpose of this text is to describe a procedure that can be used to construct a Herfindahl-Hirschman index of market concentration based on the following two pieces of information: <p> <p> a) An output measure of individual producers located in areas identified with a postal code. <p> b) A matrix containing information about the distances between the (centers of) the areas defined by postal codes. <p> <p> The examples presented in this text are from the market for general practitioners’ services in Norway, but applying the suggested procedures to other output measures should be straight forward. The STATA commands necessary to construct the index are provided. <p>
    Keywords: Herfindahl-Hirschman index; General practitioner; primary health care; market concentration; Norway
    JEL: I18 J14
    Date: 2011–10–25
  24. By: Alberto Marzucchi
    Abstract: The present paper aims to analyse the innovation policies implemented in Italy and Spain. It adopts a multi-level perspective to investigate the effects induced by regional and national public supports and a multi-dimensional approach to disentangle the different types of additionality impacts on firms’ innovation process. In particular input, output and behavioural additionality are considered. The results, obtained through a propensity score matching estimation of the average treatment effect on treated (ATT) implemented on CIS 4 microdata, capture a complex picture. In both the countries only national policies increase R&D investment. As for output additionality, whereas Spanish regional and national policies enhance the economic exploitation of new products and patent applications, Italian interventions boost only process innovation. As for the behavioural additionality, mixed evidences emerge for regional Italian policies, for which some negative effects are also found, Italian national interventions positively affect interactions with other firms and research partners, Spanish policies (both national and regional) induce funded firms to engage in formal training and to interact more with business and research partners. A tentative analysis of the “risk of policy failure†is also provided. Apart from Italian regional policies, for which no significant result is found, the Spearman’s rank correlation coefficients reveal that the (rank of the) ATT calculated for each additionality measure is negatively related to the (rank of the) corresponding coefficient of variation. High TTs are thus correlated with low dispersions.
    Keywords: innovation policy, R&D subsidies, additionality
    JEL: O31 O38
    Date: 2011
  25. By: Christoph Pamminger (Department of Applied Statistics, Johannes Kepler University Linz, Austria,); Regina Tüchler
    Abstract: In this work, we analyze wage careers of women in Austria. We identify groups of female employees with similar patterns in their earnings development. Covariates such as e.g. the age of entry, the number of children or maternity leave help to detect these groups. We find three different types of female employees: (1) “high-wage mums”, women with high income and one or two children, (2) “low-wage mums”, women with low income and ‘many’ children and (3) “childless careers”, women who climb up the career ladder and do not have children. We use a Markov chain clustering approach to find groups in the discretevalued time series of income states. Additional covariates are included when modeling group membership via a multinomial logit model.
    Keywords: Income Career, Transition Data, Multinomial Logit, Auxiliary Mixture Sampler, Markov Chain Monte Carlo
    Date: 2011–07
  26. By: Gaffard, Jean-Luc (Centre de recherche en économie de Sciences Po)
    Abstract: Pour tenir son rang dans l’économie de la connaissance, la France a décidé de transformer l’organisation de l’enseignement supérieur et de la recherche. En faisant le choix de l’autonomie de ses universités et s’engageant sur la voie d’une concurrence fondée sur une évaluation indépendante de leurs performances, elle a privilégié le soutien d’une recherche de haut niveau au motif que davantage investir dans ce domaine apporterait des points supplémentaires de croissance. Ce faisant, le développement des formations d’enseignement supérieur destinées à pourvoir un nombre grandissant d’emplois hautement qualifiés a été assez largement négligé, alors même que la croissance en dépend sans doute plus que de l’intensité de la recherche en elle-même. Aussi faudrait-il ne pas se limiter à promouvoir un petit nombre de grandes universités renommées pour la qualité de leurs recherches à l’échelle internationale, mais également s’appuyer sur la nécessaire multiplicité des critères d’excellence pour garantir l’existence d’un tissu universitaire dense et diversifié, remplissant avec efficacité la double mission de recherche et d’enseignement. Le mode de gouvernance des universités, les conditions de recrutement et de rémunération des universitaires et les conditions de financement, en bref le modèle économique de fonctionnement des universités seront déterminants du chemin qui sera suivi...
    Date: 2011–09–29
  27. By: Thomas Barré (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, ERUDITE - Equipe de Recherche sur l'Utilisation des Données Individuelles Temporelles en Economie - Ministère de l'Education nationale, de l'Enseignement supérieur et de la Recherche - Université Paris XII Val de Marne : EA437 - Université Paris-Est)
    Abstract: Uncertainty is a crucial issue for producers who must make input decisions without knowing prices and without perfect knowledge of realized output. In this context, price expectations strongly determine the production choices and market prices that result from market-clearing conditions. This study analyzed the role that price expectations play in price dynamics, developing a theoretical model of trade in varieties following Armington (1969) and augmented with yield and price uncertainty to highlight several main determinants of domestic producer prices, including exchange rates, proximity to world markets, input prices, natural disasters, and producers' expectations. An econometric estimation of the rice sector, using a panel of 13 developing Asian countries during 1965-2003, confirmed that expectations count, with a 1% increase in the expected price resulting in a 1.18% decrease in the market price. A simulation exercise based on these empirical results demonstrated that forecasting errors are large. Specifically, Asian rice farmers have a 50% chance of making prediction errors of 10% or more on the final market price. This high error rate suggests the need for developing ways of sharing information, such as radio programs dedicated to agricultural producers or the introduction of futures markets, to stabilize agricultural incomes.
    Keywords: Rice ; Asia ; price dynamics ; price expectations ;
    Date: 2011–10–02
  28. By: Ayal Kimhi (The Hebrew University); Moran Sandel (The Hebrew University)
    Abstract: The important role of education in the process of economic development is well known. Less known is the effect of education on inequality. This is an important issue, since economic policies that promote growth often lead to higher income inequality. A policy that promotes growth and at the same time reduces inequality would be preferred. The question is whether promoting education is such a policy. In this paper, the determinants of income inequality in Israel are analyzed using regression-based inequality decomposition techniques, focusing on the role of years of schooling and type of education. In particular, we differentiate between general schooling and ultra-orthodox schooling, following the common belief that ultra-orthodox schooling is not as valuable as general schooling for labor market outcomes. Indeed, we find that years of general schooling of the household head have a positive effect on per-capita household income, while the effect of years of ultra-orthodox schooling is negative. Years of general schooling are positively correlated with income, while years of ultra-orthodox schooling are negatively correlated with income. This implies that a policy that closes the schooling gaps in the secular sector is equalizing, while a policy that closes the schooling gaps in the ultra-orthodox sector is disequalizing. In addition, a uniform percentage increase in years of general schooling reduces per-capita income inequality, while a similar increase in ultra-orthodox years of schooling increases inequality. These results are robust to the type of regression used (OLS versus Gini regression), the use of equivalence scales, and do not change qualitatively even when we allow all regression coefficients to be different in the ultra-orthodox subsample. We conclude that policies directed at general schooling can potentially promote development and reduce inequality at the same time. However, when policy makers consider public funding of ultra-orthodox schools, they should take into account the adverse effects of this type of schooling on income inequality. In particular, we suggest that such funding will be conditioned on aligning the curriculum with the requirements of modern labor markets
    Date: 2011–09
  29. By: Raghbendra Jha; Sharmistha Nag; Hari K. Nagarajan
    Abstract: In a developing economy with an ethnically diverse society, such as India's, household welfare and its distribution within the household unambiguously depend on how much time each member of the household spends on productive activity. In this paper we examine the welfare impact of reducing the time spent by members of households, particularly women, through political reservations in rural India. Using a unique data set we find that (i) Political reservations and the ability of women to participate in the process of governance contribute to household welfare by allowing women to participate in labor markets, essentially because provision of public goods and in particular water, increases the productivity of household labor time. (ii) The concomitant decline in household work and increase in labor market participation is a robust indicator of increased productivity of household labor time being translated into productive work. In particular women participate in self employment and on cultivation. The effect on household incomes caused by members engaged in self-employment activities and own-cultivation is higher compared to effects caused by participation in off-farm wage labor. (iii) Further, our results are robust to the inclusion of residential location, access to credit, and shocks.
    Keywords: Political Reservations for Women, Water, Time in Unproductive Activity, IV estimation
    JEL: B21 H41 H42 J22
    Date: 2011
  30. By: M.Carolina Brandi (Institute for Research on Population and Social Policy, National Research Centre); Sveva Avveduto (Institute for Research on Population and Social Policy National Research Council); Loredana Cerbara (Institute for Research on Population and Social Policy National Research Council)
    Abstract: IRPPS/CNR finalised, in 2001, a questionnaire designed to mine information about foreigners engaged in research in Italy. We found that the numerical presence of foreign researchers was not proportionately negligible with respect to the total number of researchers in Italian public research institutes. This survey therefore demonstrates that Italian research institutes were securely connected to the international circuit of scientists and allowed us to recognize some of the main reasons of these peculiar migrations. However, the intake of foreign researchers in Italy is far lower than the outflow of Italian researchers abroad, though the dimension of the last flux is extremely hard to be determined, since no reliable statistical records are collected on this topic. Because of this reason, we recently started a new survey dedicated to the Italian researchers working abroad. Being their total number unknown, we are using the "snowball sampling” method in order to reach the highest number of subjects. The starting sample was taken from the DAVINCI data-base, available on the web site of the Italian Ministry of Foreign Affairs and composed by data voluntarily inserted by about 2000 Italian researchers working abroad. All the registered scientists were asked by e-mail to fulfil a questionnaire, basically equal to the one used for the previous survey on the foreign researchers working in Italy. Though this research is just started, its preliminary results seem to confirm the findings of the previous one concerning the reasons of what we might call the "natural mobility” of researchers: when scientists move abroad, they are generally motivated by a desire to engage in quality work, whereas other considerations that are very important to other professionals, such as economic compensation, are less important. By the way, our surveys also revealed a basic difference between the outgoing and ingoing fluxes of researchers in Italy: while the large majority of foreign scientists working in Italy plan to come back home, the largest share of the interviewees Italian researchers working abroad do not will to do the same. In both cases, the chief reasons for the scientist’s reluctance to settle in Italy can be ascribed to the unlikelihood of permanent contracts of employment and the poor prospects for career advancement in Italian public research institutes, universities and companies. This unfortunate situation, jeopardizing the Italian capability to compete in the present day knowledge based economy, is also confirmed by the results that we gathered from the analysis of the subsamples of Italian graduates working abroad from the 2007 yearly AlmaLaurea Survey on Italian Graduates’ Employment Conditions.
    Date: 2011–10
  31. By: Laurent, Eloi (Centre de recherche en économie de Sciences Po)
    Abstract: Le débat scientifique et démocratique sur la justice environnementale et sur l'articulation des politiques sociales et environnementales, vieux de plus de deux décennies outre-Atlantique, ne fait que commencer en Europe. L'État providence ne peut plus faire l'impasse dans l'Union européenne sur l'environnement dans lequel vivent les individus (travail, résidence, loisirs) dès lors que celui-ci détermine en partie les facteurs affectant leur santé et plus largement leur bien-être. Il s'agit donc pour les pays membres et les instances de l'UE à la fois d'adopter et d'adapter l'exigence de justice environnementale. Cet article propose des pistes en vue de cette adaptation et, après avoir défini différentes catégories d'inégalités environnementales, en éclaire plus particulièrement un aspect : la précarité ou pauvreté énergétique. La situation du Royaume-Uni et de la France sont passées en revue avant d'aborder les enjeux et modalités d'une politique européenne de lutte contre la précarité énergétique.
    Keywords: justice environnementale, Union européenne, inégalités environnementales, précarité énergétique, pauvreté énergétique.;
    Date: 2011
  32. By: Olga Biosca; Pamela Lenton; Paul Mosley
    Abstract: Microfinance non-financial services have been recently reformulated as high quality demand-led programs. In the Mexican context, these are now voluntary, can have a cost for the borrower and are frequently supplied in partnership with specialized public or private agencies. Using primary data from a survey of clients of two credit-plus programs in Chiapas, this paper examines and compares the participation determinants and added impact of the training sessions on monetary poverty outcomes of the borrowers. We focus on two specific programs: Business Development Services and Preventive Health Services. Results suggest that the participation decision mainly depends on borrowers’ characteristics. Non-financial services are found to reduce the clients’ likelihood of being under the asset poverty line. No significant differences were observed between the impacts of the two non-financial programs.
    Keywords: Non-financial services, Credit-plus, Microfinance, Poverty, Oportunidades.
    Date: 2011–10
  33. By: Schilirò , Daniele
    Abstract: Classical mathematical algorithms often fail to identify in time when the international financial crises occur although, as the classical theory of choice would suggest, the economic agents are rational and the markets are or should be efficient and behave also rationally. This contribution does not pretend to give a complete answer to these questions, but it will highlight some well-known limits of the classical theory of rational choice and compare this theory of choice with the approach that seeks to combine economics and psychology and that has established itself as cognitive or behavioral economics. In particular, the present paper will focus on the juxtaposition of the concepts of perfect rationality and bounded rationality. It concludes with some references to the literature of behavioral finance which has given important contributions in explaining the behavior and the anomalies of financial markets.
    Keywords: Bounded rationality; procedural rationality; rational choice; cognitive economics
    JEL: D81 B52 C00 D83
    Date: 2011–10
  34. By: Giulio Pedrini (Department of Economics, University of Bologna; SDIC, School of Innovation Development and Change, Bologna)
    Abstract: This study deals with the attitude of European firms towards personnel policies analysed on a national basis. Provided the relevance of Human Resources (HR) practices in terms of the internal organisation of knowledge of the firm, we assess the main characteristic of personnel policies in 12 European countries both in terms of HR department position within the firm and in terms of human capital development practices. Not only is the issue significant in terms of Human Resource Management but also in terms of the debate on the role of the institutions in determining personnel policies, and notably in terms of the debate on the "varieties of capitalism”. For this purpose the paper develops a cluster analysis among 16 European countries showing the possible influence of institutional models on personnel policies. The same analysis is also developed for intertemporal comparative purposes. The second part of the paper analysis relates personnel policies to the phenomenon of Corporate Universities (CU), being they intended as a vehicle of firms’ capability to react to organisational and technological change. Within the complex relationship between firm’s organization and knowledge CU may in fact represent a consistent way to keep HR departments and firms’ strategies tightly connected, possibly assuming a systemic vision of the firm open to employees and in some cases to other stakeholders. The main features of European Corporate Universities will thus be acknowledged by looking at their main characteristics, with particular reference to their relation with HR departments and to the external factors that have contributed to their development. The paper uses theoretical tools provided by economic literature on training, human capital and knowledge management, combining them with a descriptive analysis of the empirical evidence coming from data on both Corporate Universities and firms’ personnel policy at European level. In particular data on firms’ personnel policy will come from the survey performed in 2005 by Cranet, the largest academic research network dedicated to a comparative analysis of developments in Human Resource Management in public and private organisations. Such data will be integrated by surveys on firms’ training practices at European level and by the (limited) empirical literature dealing with European Corporate Universities.
    Date: 2011–09
  35. By: D.P. Chaudhri; Raghbendra Jha
    Abstract: Using Census and NSS data this paper studies the evolution of Gender Bias (GB) in the age group 0–6 in India and its association with education and higher prosperity. GB is pervasive and has grown over time with higher prosperity and resultant demographic transition and enhanced education. The number of children in the age group 0–14 peaked in 2001 and has, since, been falling. Even as the under 5 mortality rate has fallen from 240.1 per thousand in the 1961 census to 65.6 in 2011, the total fertility rate (TFR) has experienced an equally sharp decline from 6.1 in 1961 to 2.6 in 2011. That large household size (associated with high fertility rates and low Monthly per capita expenditure (MPCE)) is linked with low GB comes as no surprise. However, with higher prosperity and lower TFR GB rises sharply. The percentage difference in GB in successive time periods fell from 0.3 in 1951 to 0.1 in 1961 but accelerated to 1.9 in 2011. GB is higher in the age group 0–4 than in the 0–6 group. GB has actually improved for the age group 10–14 but this fact is irrelevant for the evolution of GB in children since children in that age group will soon be adults. Hence, the outlook for GB in the age group 0–6 appears bleak at least until 2026. The paper also demonstrates that there are wide variations in GB across various states, even districts, of India. In 2011 child population is still high in the EAG states whereas the growth of child population has come down substantially in some states, particularly some southern states and Himachal Pradesh. At the district level we discover that the education of girls is an important determinant of GB. At the household level both improved education of females in the age group 15–49 and higher prosperity lead to worsening of GB. However, at high values of the interaction of these two variables there could be a turnaround in the trend of worsening GB. At present trends, however, this is unlikely to happen at least until 2026. More positive outcomes require social engineering through multidimentional, orchestrated policies, especially in relation to enhanced prosperity and education of women in the child bearing age group. Improvements in GB are discernable in some districts, states and households. In 55 districts GB declined and proportion of girls attending schools increased. Kerala and Tamil Nadu did not have any worsening of GB while GB declined in Himachal Pradesh. Finally, prosperity improved GB among Scheduled Castes, Scheduled Tribes and Muslims, and households having women in child bearing age group with graduate degrees.
    Keywords: Gender Bias, Census, National Sample Survey, Demographic Transition, India
    JEL: J16 N35 O15 O53
    Date: 2011
  36. By: Elisabeth Bügelmayer; C. Katharina Spieß
    Abstract: Although spiteful preferences play a crucial role in the development of human large-scale cooperation, there is little evidence on spiteful behavior and its determinants in children. We investigate the relationship between children’s cognitive skills and spiteful behavior in a sample of 214 preschoolers aged 5-6 and their mothers. Other-regarding behavior of both mothers and children is elicited through four simple allocation decisions. A key advantage of our study is that it is carried out in a household context. Therefore, we have information about both the child’s and mother’s cognitive and noncognitive skills as well as health and household characteristics. We find that higher cognitive skills are associated with more spiteful behavior in children. This relationship is even more pronounced among boys and possibly reflects differences in competitiveness. Moreover, we find further gender differences depending on the measure of cognitive skills and the degree of spite. These results shed light on the determinants of the development of other-regarding preferences in humans.
    Keywords: Spite, other-regarding preferences, cognitive skills, child experiments, household survey studies
    JEL: C90 C99 J24
    Date: 2011
  37. By: Mark A. Carlson; Jonathan D. Rose
    Abstract: This paper examines the mechanism through which banking sector distress affects the availability of credit. We use the experience of the United States during the Great Depression, a period of intense bank distress, to conduct our analysis. We utilize previously neglected data from a 1934 survey conducted by the Federal Reserve System of both banks and Chambers of Commerce regarding the availability of credit, and examine which aspects of the banking system collapse affected credit availability as indicated by the survey. A number of scholars have posited different ways that bank distress constrained credit availability and impacted economic activity during the 1930s; however, the empirical evidence regarding these channels is modest. In this study, we find that bank failures had the most dominant impact, but there is also some evidence for the importance of funding constraints from deposit outflows and of protracted deposit liquidation.
    Date: 2011
  38. By: Hervé Charmettant (CREG - Centre de recherche en économie de Grenoble - Université Pierre Mendès-France - Grenoble II : EA4625); Michel Rocca (CREG - Centre de recherche en économie de Grenoble - Université Pierre Mendès-France - Grenoble II : EA4625)
    Abstract: Dans un premier temps, cette communication propose une sélection de travaux conventionnalistes en fonction de leur capacité contributive à la formation d'un paradigme institutionnaliste unifié. Loin d'être un palmarès de performances, cette sélection des références conventionnalistes jugées exploitables vise à "rehausser" l'économie des conventions dans ses pertinences et réduire le risque de déshérence qui la guette si son possible apport à la constitution d'un paradigme n'est pas signalé. Dans un second temps, sont pointées deux directions épistémologiques prises par l'économie des conventions qui sont susceptibles de féconder favorablement le champ d'un paradigme alternatif en formation. En particulier, elles guident les recherches futures vers une prise en compte de la dimension légitime des institutions, source d'enrichissement analytique. La communication termine sur une interrogation sur la frontière entre l'économique et le politique, frontière à laquelle se heurte toute contribution à une "économie politique".
    Keywords: économie des conventions ; institutionnalisme ; théorie économique
    Date: 2010–12–09
  39. By: Wataru Takahashi (Research Institute for Economics and Business Administration, Kobe University)
    Abstract: This paper looks at Japan's experience in transforming its financial system. While the country is considered a model of successful Asian economic development, it has encountered many difficulties as introducing market economy. During the 1960s and 1970s, Japan experienced high economic growth, contributed by its regulated financial sector. Cooperation among the government, banks and corporations created a strong system, in which main banks played an important role. They supported companies and, sometimes, in addition to their role in the corporate governance of client enterprises, they also rescued troubled companies. In addition, banks extended loans to businesses in promising sectors, thereby assuming risks similar to those taken by venture capitalists. However, during the 1970s and 1980s, Japan's financial system, under pressure from the changing economic environment, was compelled to adjust. Economic growth led to changes in the money flow, as Japanese big business began to lose its appetite for borrowing. Instead, there developed circumvented financing outside the domestic market that, with the growing bond market and accumulation of other financial assets, led to financial liberalization.In the late 1980s, this liberalization resulted in a combination of loose monetary conditions after the Plaza Agreement, an economic boom, and the bursting of the asset bubble. Then, between 1991 and 2000, Japan experienced a “lost decade.†Now, in order to pull itself out of its economic malaise, Japan continues to focus on market orientation in a bid to achieve economic reform but, so far, this has been little benefit. One of the main challenges Japan still faces is developing a new set of institutional complementarities.
    Keywords: Institutional Complementarities, Network Capitalism, Personalized System
    JEL: E44 N15 O16
    Date: 2011–10
  40. By: Sharmila Kurukulasuriya; Solrun Engilbertsdottir (Division of Policy and Practice,UNICEF)
    Abstract: There is a growing consensus that children experience poverty in ways that are different from adults; and looking at child poverty through an income-consumption lens only is inadequate. The 2005 State of the World’s Children presented the following definition of child poverty: “Children living in poverty experience deprivation of the material, spiritual and emotional resources needed to survive, develop and thrive, leaving them unable to enjoy their rights, achieve their full potential or participate as full and equal members of society”. Using evidence from UNICEF’s ongoing Global Study on Child Poverty in Disparities, this Brief illustrates the importance of looking beyond traditional methods of measuring poverty based on income or consumption levels, and emphasizes the importance of seeking out the multidimensional face of child poverty. This approach further recognizes that the method used in depicting child poverty is crucial to the policy design and implementation of interventions that address children’s needs, especially among the most deprived.
    Keywords: child poverty, child disparities, policy design, measuring poverty, State of the World’s Children,Global Study on Child Poverty
    Date: 2011
  41. By: Gevrek, Z. Eylem (University of Konstanz); Gevrek, Deniz (Texas A&M University Corpus Christi); Gupta, Sonam (University of Florida)
    Abstract: We examine the impact of culture on the work behavior of second-generation immigrant women in Canada. We contribute to the current literature by analyzing the role of intermarriage in intergenerational transmission of culture and its subsequent effect on labor market outcomes. Using relative female labor force participation and total fertility rates in the country of ancestry as cultural proxies, we find that culture matters for the female labor supply. Cultural proxies are significant in explaining number of hours worked by second-generation women with immigrant parents. More importantly, we show that the impact of cultural proxies is significantly larger for women with immigrant parents who share same ethnic background than for those with intermarried parents. The fact that the effect of culture is weaker for women who were raised in intermarried families stresses the importance of intermarriage in assimilation process. Our results are robust to different specifications and estimation strategies.
    Keywords: immigrant women, labor supply, culture, intermarriage
    JEL: J12 J16 J22 J61
    Date: 2011–10
  42. By: Isabel Ortiz; Matthew Cummins (Division of Policy and Practice,UNICEF)
    Abstract: This working paper: (i) provides an overview of global, regional and national income inequalities based on the latest distribution data from the World Bank, UNU-WIDER and Eurostat; (ii) discusses the negative implications of rising income inequality for development; (iii) calls for placing equity at the center of development in the context of the United Nations development agenda; (iv) describes the likelihood of inequalities being exacerbated during the global economic crisis; (v) advocates for urgent policy changes at national and international levels to ensure a “Recovery for All”; and, (vi) to serve as a general reference source, Annex 2 provides a summary of the most up-to-date income distribution and inequality data for 141 countries
    Keywords: income inequality, income distribution, quintiles, equity,crisis recovery, development policy
    JEL: D6 D63 D3 D31 O1 O2
    Date: 2011
  43. By: Isabel Ortiz; Matthew Cummins (Division of Policy and Practice,UNICEF)
    Abstract: In the wake of the food, fuel and financial shocks, a fourth wave of the global economic crisis began to sweep across developing countries in 2010: fiscal austerity. Serving as an update of earlier research by UNICEF, this working paper: (i) examines the latest IMF government spending projections for 128 developing countries, comparing the three periods of 2005-07 (pre-crisis), 2008-09 (crisis phase I: fiscal expansion) and 2010-12 (crisis phase II: fiscal contraction); (ii) discusses the possible risks for social expenditures; (iii) assesses the most common adjustment measures being considered by developing countries in 2010-11 and their potentially adverse impacts on vulnerable populations; and (iv) summarizes a series of alternative policy options that are available to governments to expand fiscal space and ensure a Recovery for All, including children and poor households.
    Keywords: fiscal consolidation, fiscal contraction, austerity measures, public expenditures, social spending, crisis recovery, poverty, wage bill, food and energy subsidies, pension reform, social protection
    JEL: H5 O23 H5 I3 J3
    Date: 2011
  44. By: Bargain, Olivier (University of Aix-Marseille II); Donni, Olivier (University of Cergy-Pontoise); Kwenda, Prudence (University College Dublin)
    Abstract: Poverty measures in developing countries often ignore the distribution of resources within families and the gains from joint consumption. In this paper, we extend the collective model of household consumption to recover mother's, father's and children's shares together with economies of scale, using the observation of adult-specific goods and an extended version of the Rothbarth method. The application on data from Côte d'Ivoire shows that children command a reasonable fraction of household resources, though not enough to avoid a very large extent of child poverty compared to what is found in traditional measures based on per capita expenditure. We find no significant evidence of discrimination against girls, and educated mothers have more command over household resources. Baseline results on children's shares are robust to using alternative identifying assumptions, which consolidates a general approach grounded on a flexible version of the Rothbarth method. Individual measures of poverty show that parents are highly compensated by the scale economies due to joint consumption.
    Keywords: collective model, consumer demand, Engel curves, Rothbarth method, cost of children, bargaining power, sharing rule, scale economies, equivalence scales, indifference scales
    JEL: D11 D12 I31 J12
    Date: 2011–10
  45. By: Carmen Pellicer-Lostao; Ricardo Lopez-Ruiz
    Abstract: Agent-based models have demonstrated their power and flexibility in Econophysics. However their major challenge is still to devise more realistic simulation scenarios. The complexity of Economy makes appealing the idea of introducing chaotic number generators as simulation engines in these models. Chaos based number generators are easy to use and highly configurable. This makes them just perfect for this application.
    Date: 2011–10

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