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on Investment |
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Issue of 2024‒05‒13
twenty papers chosen by |
| By: | Leif Danziger |
| Abstract: | This paper explores how a minimum wage affects a firm’s behavior with a competitive labor market and an uncertain export cost. The model provides several novel insights which are consistent with recent empirical evidence. Thus, a minimum wage increases an exporter’s foreign-market size and may cause a non-exporter to start exporting. The foreign-market size may increase so much that, although the home-market size decreases, the overall firm size increases. |
| Keywords: | minimum wage, exports, firm size |
| JEL: | J30 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10997&r=inv |
| By: | Devereux, Kevin; Studnicka, Zuzanna |
| Abstract: | Minimum wages decrease employment in competitive markets, but can increase it in monopsonistic markets so long as they do not exceed the marginal product of labour. We find evidence of non-monotonicity both by market structure and minimum wage level. Minimum wage hikes initially increase hours worked for minimum wage workers (MWWs) in high-concentration local labour markets (LLMs), while increasing job loss likelihood for MWWs in low-concentration LLMs. Repeated hikes reverse initial hours gains, and may increase job loss. Non-MWWs show economically negligible responses throughout. Observing minimum wage status allows for both within- and across-market difference-in-difference designs, whose findings provide mutual support. We combine these into a triple-difference specification. Our results help to resolve the lack of consensus around the sign of the minimum wage's employment effects. |
| Keywords: | Minimum wage, Monopsony, Oligopsony, Local labour Markets |
| JEL: | J22 J23 J38 J42 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:clefwp:289599&r=inv |
| By: | Fan Yang (Charles University, Prague); Tomas Havranek (Charles University, Prague & Centre for Economic Policy Research, London & Meta-Research Innovation Center, Stanford); Zuzana Irsova (Charles University, Prague); Jiri Novak (Charles University, Prague) |
| Abstract: | We examine the factors influencing published estimates of hedge fund performance. Using a sample of 1, 019 intercept terms from regressions of hedge fund returns on risk factors (the “alphas†) collected from 74 studies, we document a strong downward trend in the reported alphas. The trend persists even after controlling for heterogeneity in hedge fund characteristics and research design choices in the underlying studies. Estimates of current performance implied by best practice methodology are close to zero across all common hedge fund strategies. Additionally, our data allow us to estimate the mean management and performance fees charged by hedge funds. We also document how reported performance estimates vary with hedge fund and study characteristics. Overall, our findings indicate that, while hedge funds historically generated positive value for investors, their ability to do so has diminished substantially. |
| Keywords: | hedge funds, alpha, fees, meta-analysis, model uncertainty |
| JEL: | J23 J24 J31 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp2024_15&r=inv |
| By: | Hales, Laura J.; Coleman-Jensen, Alisha |
| Abstract: | Since 1995, when consistent food security monitoring began in the United States, differences have been identified in the prevalence of food insecurity across race and ethnicity. Households with Hispanic and Black, non-Hispanic reference persons have had a higher prevalence of food insecurity than households with White, non-Hispanic, or other, non-Hispanic reference persons. Less is known about the food security status of race and ethnic groups that comprise a smaller share of the population—including American Indian and Alaskan Native, Asian, Hawaiian and Pacific Islander, and multiracial groups, including individuals identifying as American Indian and White, individuals identifying as Black and White, and other multiracial combinations. This report combines 6 years of data from the U.S. Department of Commerce, Bureau of the Census, Current Population Survey Food Security Supplement (2016–21) to examine household food security among these race and ethnic groups, including by household and economic characteristics and across Hispanic and Asian origin groups. The prevalence of food insecurity ranges from a low of 5.4 percent for Asian households to a high of 23.3 percent for American Indian and Alaska Native households. Meaningful differences in food insecurity exist across and within racial, ethnic, and origin groups. |
| Keywords: | Food Security and Poverty, Labor and Human Capital |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:ags:uersib:341822&r=inv |
| By: | Heyen, Nils B.; Zenker, Andrea; Aichinger, Heike; Bratan, Tanja; Kaufmann, Tanja; Schnabl, Esther |
| Abstract: | For more than a decade, advocates of both green growth and degrowth have argued about the role of economic growth for the transformation towards a societal system that ensures social well-being on a global scale without transgressing planetary boundaries. Given that such a transformation needs innovations of various kinds, this article explores the question of how dependent innovation is on economic growth and what effects a potential long-term economic stagnation or decline may have on innovation processes and systems. We approach the subject from different angles using mixed methods. First, we present a quantitative analysis of the linkages between economic growth and innovation activities on a sectoral level, based on data of the Community Innovation Survey (CIS) for Germany. Here, we find two sectors (petroleum and advertising industries) showing negative growth rates but still a higher than average share of innovative enterprises. Subsequently, we present an in-depth qualitative case study of the international pharmaceutical sector, which allows us to include a qualitative evaluation dimension. Here, we investigate different innovation approaches and find that both the amount of capital needed to finance research and development activities and the added health benefit of novel drugs vary greatly. We finally conclude that economic growth is not a necessary condition for all kinds of innovation and reflect on some implications for innovation policy. If in a post-growth era financial resources are limited, a shift to less capital-intensive types of innovation and a concentration on innovations which address prioritised societal or ecological needs seem feasible. |
| Keywords: | (in)dependency, innovation, economic growth |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fisidp:289610&r=inv |
| By: | Cappelli, Federica |
| Abstract: | The question of whether changes in income inequality affect CO2 emissions remains a topic of debate at both theoretical and empirical levels. The purpose of this paper is to examine the effect of changes in the full spectre of income distribution on consumption based CO2 emissions per capita. To do so, we estimate a dynamic difference-GMM model and a dynamic threshold regression model allowing for endogeneity on a panel database covering 107 countries between 1990 and 2019. Our analysis highlights how different income classes contribute very differently to consumption-based CO2 emissions. In addition, by accounting for between-country inequalities in the average income of each income group, we uncover non-linearities in the impact on carbon emissions. More specifically, the impact of an increase in the income share of the top 10% on per capita consumption-based carbon emissions varies according to their average income level: it is negative at lower income levels and becomes positive as their income rises. The contribution of the middle class is negative at all income levels, while the CO2 contribution of the poorest segments is negligible. |
| Keywords: | Environmental Economics and Policy, Research Methods/ Statistical Methods |
| Date: | 2024–04–16 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemwp:341641&r=inv |
| By: | Vahdat, Zahra; Singh, Abhyudai |
| Abstract: | Across diverse cell types, genes are often expressed at low levels resulting in significant stochastic fluctuations (noise) in intracellular copy number of mRNAs and proteins over time. Motivated by single-cell experiments, we capture this stochasticity by considering a given gene that toggles between a transcriptionally active and inactive state with the time spent in each state being an arbitrary random variable. mRNAs are synthesized from the active state as per a Poisson process and each molecule degrades after a random lifespan (i.e., random time from birth to death). Modeling this process using the Stochastic Hybrid System (SHS) formalism we derive exact analytical results for the statistical moments of molecular counts. Our results show that for fixed mean mRNA numbers, fluctuations in mRNA levels are amplified with decreasing noise in mRNA lifespan. Relaxing the Poisson process assumption, we next consider a scenario where transcription events occur such that the time between successive events is an arbitrarily distributed random variable. In this case, we show that decreasing noise in mRNA lifespan can both increase/decrease mRNA count fluctuations depending on the underlying transcriptional process. Finally, we extend these results to the protein level, where increasing noise in mRNA counts is sometimes associated with decreasing noise in protein copy numbers. |
| Date: | 2024–04–08 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:u4rtb&r=inv |
| By: | Nahar, Kamrun; Akhter, Suraiya; Shaturaev, Jakhongir |
| Abstract: | This research article aims to explore and assess the influence of music education on cognitive development in children. Drawing upon various theories and previous studies, the research seeks to provide a comprehensive analysis of the potential benefits of music education in enhancing cognitive abilities such as memory, attention, problem-solving, and language skills. A thorough literature review was conducted, encompassing studies from diverse disciplines, including psychology, education, neuroscience, and music therapy. The review revealed that exposure to music activates multiple regions of the brain involved in cognitive processes, suggesting a strong interconnection between music and cognitive development. The findings indicated that music education, with its structured learning, practice, and performance elements, could actively contribute to the cognitive growth of children. This study employed a mixed-methods approach, including both quantitative and qualitative methodologies, to examine the cognitive skills of children enrolled in formal music education programs in comparison to those without such exposure. The quantitative analysis involved administering standardized cognitive tests to measure various aspects of cognitive development, while the qualitative component included interviews and observations to capture the nuanced experiences and perceptions of the participating children and their parents. Preliminary findings from this study indicate that children engaged in music education demonstrated higher levels of cognitive performance compared to their non-musical peers. Specifically, participants displayed improved attention span, verbal and non-verbal memory, problem-solving abilities, and creativity. The qualitative data explored the positive impact of music education on self-esteem, discipline, social skills, and emotional well-being, providing a holistic perspective on the potential benefits of music beyond cognitive development. This research article concludes by discussing the implications of these findings for educators, policymakers, and parents. It highlights the significance of integrating music education into school curricula and recommends further investment in music programs to optimize cognitive development in children. The study underscores the importance of a well-rounded education that recognizes the multifaceted benefits of music across different domains of child development. |
| Keywords: | AI; HRM; training; costs; benefits |
| JEL: | M1 M12 M15 |
| Date: | 2024–01–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:120579&r=inv |
| By: | Fetzer, Thiemo (University of Warwick & University of Bonn & CEPR & ECONtribute); Rauh, Christopher (University of Cambridge, PRIO, CEPR, IZA & HCEO); Schreiner, Clara (Nuffield College, University of Oxford.) |
| Abstract: | Seasonal infectious diseases can cause demand and supply pressures that reduce the ability of healthcare systems to provide high-quality care. This may generate negative spillover effects on the health outcomes of patients seeking medical help for unrelated reasons. Separating these indirect burdens from the direct consequences for infected patients is usually impossible because of a lack of suitable data and an absence of population testing. However, this paper finds robust empirical evidence of excess mortality among non-COVID-19 patients in an integrated public healthcare system: the English NHS. Analysing the forecast error in the NHS’ model for predicted mortality, we find at least one additional excess death among patients who sought medical help for reasons unrelated to COVID-19 for every 42 COVID-19-related deaths in the population. We identify COVID-19 pressures as a key driver of non-COVID-19 excess mortality in NHS hospitals during the pandemic, and characterise the hospital populations and medical conditions that are disproportionately affected. Our findings have substantive relevance in shaping our understanding of the wider burden of COVID-19, and other seasonal diseases more generally, and can contribute to debates on optimal public health policy. |
| Keywords: | Externalities; spillovers; COVID-19; public health; seasonal diseases; excess mortality; prediction error JEL Classification: I1, I18 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:cge:wacage:705&r=inv |
| By: | Cheikh T. Ndour (Cheikh Anta Diop University, Dakar, Senegal); Simplice A. Asongu (Johannesburg, South Africa) |
| Abstract: | Purpose – This study examines the relevance of information and communication technologies in the effect of gender economic inclusion on environmental sustainability. Design/methodology/approach – The focus is on a panel of 42 sub-Saharan African countries over the period 2005-2020. The empirical evidence is based on generalized method of moments. The environmental sustainability indicator used is CO2 emissions per capita. Two indicators of women's economic inclusion are considered: women's labour force participation and women's unemployment. The chosen ICT indicators are mobile phone penetration, internet penetration and fixed broadband subscriptions. Findings – The results show that: (i) fixed broadband subscriptions represent the most relevant ICT moderator of gender economic inclusion for an effect on CO2 emissions; (ii) negative net effects are apparent for the most part with fixed broadband subscriptions (iii) both positive ICT thresholds (i.e., critical levels for complementary policies) and negative ICT thresholds (i.e., minimum ICT levels for negative net effects) are provided; (iv) ICT synergy effects are apparent for female unemployment, but not for female employment. In general, the joint effect of ICTs or their synergies and economic inclusion should be a concern for policymakers in order to better ensure sustainable development. Moreover, the relevant ICT policy thresholds and mobile phone threshold for complementary policy are essential in promoting a green economy. Originality/value –The study complements the extant literature by assessing linkages between information technology, gender economic inclusion and environmental sustainability. |
| Keywords: | ICT, Gender inclusion; Environment sustainability; Sub-Saharan Africa |
| JEL: | C52 O38 O40 O55 P37 |
| Date: | 2024–01 |
| URL: | http://d.repec.org/n?u=RePEc:aak:wpaper:24/004&r=inv |
| By: | Fredriksson, Peter (Uppsala University); Öckert, Björn (IFAU); Tilley, J. Lucas (Stockholm University) |
| Abstract: | We examine whether parental and school investments reinforce or compensate for student performance. Our analysis exploits school-starting-age rules in 34 countries, capturing achievement variation that arises because younger children typically underperform their older peers. Parents respond to lower performance by providing additional homework help, while schools allocate weaker students to smaller classes and offer more remedial tutoring. Notably, parents provide more support to low-performing children in nearly all countries studied. Compensatory investments increase over grade levels, suggesting parents and schools respond as information about achievement is revealed. Moreover, our evidence suggests that parental and school investments are substitutes. |
| Keywords: | human capital investment, parental inputs, school inputs, student performance, school starting age |
| JEL: | I21 I28 J24 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16901&r=inv |
| By: | Pazhanisamy, R. |
| Abstract: | Small and Micro Enterprises (SMEs) in India are facing many problems such as unable to access to low cost credit from the formal financial institutions, specifically banking and extend their product to the remote markets. Some factors restrict the access to the finance on the input side while others restrict the products and its market outreach on the others side blocks the micro enterprises growth and lead to the rural population to be interlocked in chronic underemployment underdevelopment. With regard to this there are a very few research attempts are only available to test and verify the implication and operations of the Economic theories that highlights these two side issues rationalize how they contribute for the long run credit gap in the rural economy. Particularly the literature on the credit rationing theory on the input side of the financial inclusion policies and the pecking order theory on the demand side of the finance and their inter relationship with other theories like theory of moral hazard, agency theory, and the theory of adverse selection etc. are not documented and tested at the gross root level for which this paper attempted fill this gap. |
| Keywords: | Challenges of Micro Businesses, Issues of Rural Micro Enterprises, Test of theoretical impact on micro businesses, challenges of rural business Management, Financial inclusion challenges in rural areas |
| JEL: | D21 E32 G53 L22 L98 M30 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:289783&r=inv |
| By: | Kiet Tuan Duong (School for Business and Society, University of York.); Luu Duc Toan Huynh (School of Business and Management, Queen Mary University of London.) |
| Abstract: | This paper investigates how weather-affected firms make decisions on fixed asset purchases and financing choices for fixed asset acquisition. Utilizing a unique dataset comprising over 26, 000 firms across 40 countries, we find that weather-affected firms are more prone to purchase fixed assets, increasing investments in machinery, equipment, and real estate. These purchases are primarily financed through equity, bank loans, and government grants. Particularly, we find leasing is a vital fallback financing source for firms experiencing losses due to extreme weather. Firms that exclusively rely on leasing rather than other financial sources are more likely the ones that face significant external financing barriers, including complex loan procedures, high collateral requirements, and increased loan rejection rates. Interestingly, weather-affected firms who have successfully obtained non-leasing finance for fixed asset purchases, have a higher tendency to also engage in leasing, underscoring that such firms adopt flexible strategies for fixed asset acquisition. |
| Keywords: | Extreme weather, Firm-level climate losses, Fixed assets, Financing decisions, leasing, Financial obstacles |
| JEL: | E44 F33 G15 L72 Q31 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:cgs:wpaper:116&r=inv |
| By: | Tsitsi Effie Mutambara |
| Abstract: | South Africa-Africa trade was examined for 2001-2021 and results show that Africa is an important market for South Africa’s manufactured products and there is ease of market access for these products; its trade with Africa is highly complementary; and it has strong trade linkages with Africa’s regional groups. Current South Africa-Africa trade is a foundation South Africa could utilise to consolidate, broaden and strengthen its role in intra-Africa trade with the AfCFTA in place as more complementary trade opportunities emerge; markets open more and current trade linkages with regional groups strengthen as trade barriers are reduced further; and regional value chains and production clusters initiatives emerge as market access improves with new and dynamic comparative advantages emerging. |
| Keywords: | Trade complementarity, Revealed trade barrier index, Trade intensity. |
| JEL: | F12 F14 |
| Date: | 2024–04–02 |
| URL: | http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2024_02&r=inv |
| By: | Patrick Aldridge; Stephane Gignac; Rishi Vala; Adrian Walton |
| Abstract: | Nous examinons comment les sociétés d’assurance vie gèrent les risques de liquidité engendrés par leur modèle d’affaires. Nous constatons que les sociétés d’assurance vie canadiennes n’ont pas eu à faire face à d’importants retraits de liquidité et ont maintenu leur comportement de placement habituel durant la crise de la COVID-19 et la période de hausse des taux d’intérêt en 2022. |
| Keywords: | Institutions financières, Maladie à coronavirus (COVID-19), Marchés financiers, Stabilité financière, Structure de marché et établissement des prix |
| JEL: | G12 G14 G23 D47 D53 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocsan:24-7fr&r=inv |
| By: | OECD |
| Abstract: | As populations age and the number of people with chronic conditions increases, countries need to assess how their health systems perform with regard to the management of chronic conditions. OECD's Patient-Reported Indicator Surveys (PaRIS) initiative aims to measure outcomes and experiences of healthcare as reported by patients with chronic conditions as part of the efforts to improve quality of care. The PaRIS survey, an international survey of people living with chronic conditions who are managed in primary care, is implemented in twenty countries. Following a rigorous design and development phase, the PaRIS survey was field-tested in participating countries. This paper reports on the implementation and the results of the Field Trial. The Field Trial provided important lessons which have been used to improve the survey tools and the implementation of the Main Survey. |
| Date: | 2024–04–25 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaad:166-en&r=inv |
| By: | Kirsten Brew; Jessica Hanson; Ricardo Limés; Ryan Smith; Larkin Terrie |
| Abstract: | Following international guidelines, BEA statistics on bilateral U.S. direct investment abroad are compiled and presented by immediate partner economy. While this approach is well suited for many purposes, it can lead to difficulty in interpreting direct investment statistics, especially in identifying the economies that are the ultimate destinations, or hosts, of direct investment. BEA’s initial effort to produce U.S. direct investment abroad statistics by ultimate host economy (UHE), described in this paper, focused on producing statistics on equity position by UHE using six different methods to reallocate the equity position by immediate host economy. The methods are implemented using direct investment data reported on BEA’s Quarterly Survey of U.S. Direct Investment Abroad and activities of multinational enterprises data reported on BEA’s Benchmark Survey of U.S. Direct Investment Abroad. The paper concludes that three of the six methods merit further exploration and presents summary country and sector-level results for the selected methods. |
| JEL: | F21 F23 |
| Date: | 2023–10 |
| URL: | http://d.repec.org/n?u=RePEc:bea:papers:0120&r=inv |
| By: | Andrew Balthrop; Hyunseok Jung |
| Abstract: | Unexpected events -- "shocks" -- are the motive force in explaining changes in embeddedness and retention within the unfolding model of labor turnover. Substantial research effort has examined strategies for insulating valued employees from adverse shocks. However, this paper provides empirical evidence that unambiguously negative shocks can increase employee retention when underlying firm and employee incentives with respect to these shocks are aligned. Using survival analysis on a unique data set of 466, 236 communication records and 45, 873 employment spells from 21 trucking companies, we show how equipment-related shocks tend to increase the duration of employment. Equipment shocks also generate paradoxically positive sentiments that demonstrate an increase in employees' affective commitment to the firm. Our results highlight the important moderating role aligned incentives have in how shocks ultimately translate into retention. Shared hardships strengthen bonds in employment as in other areas. |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2404.00183&r=inv |
| By: | Yunmin Chen (National Central University, Taiwan); Jang-Ting Guo (Department of Economics, University of California Riverside) |
| Abstract: | In the context of a dynamic (three-period) general equilibrium model, this paper examines the optimal tax rates on capital savings and labor income under quasi-hyperbolic discounting and idiosyncratic productivity shocks. In the absence of skill-type uncertainty, we analytically show that the marginal capital tax wedges on agents' first-period savings are negative for correcting inherent preference internalities, and that these tax rates will be higher when productivity disturbances are incorporated. In the stochastic two-type setting with exogenously-given factor input prices, our calibrated numerical experiments find that the marginal capital wedges for both types on their period-1 savings are positive, indicating the government's motive to relax individuals' incentive-compatibility constraints. We also quantitatively find that the optimal tax rates for both types on their first- and second-period capital savings, as well as the economy's social welfare, are ceteris paribus decreasing in the degree of quasi-hyperbolic discounting because of a stronger need to rectify negative utility internalities. |
| Keywords: | Optimal Dynamic Income Taxation; Quasi-Hyperbolic Discounting; Idiosyncratic Productivity Shocks. |
| JEL: | D91 H21 H24 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:ucr:wpaper:202403&r=inv |
| By: | Serena Merrino; Ilias Chondrogiannis |
| Abstract: | We examine the effect of post-2010 banking regulation in South Africa on financial stability, macroeconomic variables and bank performance. We focus on risk spillovers and increased network and tail connectedness between banks, using a sample of nine listed South African banks in 20082023. The implementation of Basel III regulation, particularly capital adequacy ratios, has reduced connectedness-related risks but there is weak evidence of an effect of regulation on bank performance. |
| Date: | 2024–04–15 |
| URL: | http://d.repec.org/n?u=RePEc:rbz:wpaper:11060&r=inv |