nep-pbe New Economics Papers
on Public Economics
Issue of 2006‒08‒12
twenty-six papers chosen by
Peren Arin
Massey University

  1. On the Effects of Fiscal Policies in Portugal By Alfredo M. Pereira; Oriol Roca Sagales
  2. Regional Macroeconomic Outcomes Under Alternative Arrangements for the Financing of Urban Infrastructure By James Giesecke; Peter B. Dixon; Maureen T. Rimmer
  3. Public Goods and Budget Deficit By Abraham Neyman; Tim Russo
  4. Tobacco Taxation in the European Union By Sybren Cnossen
  5. Corporate and Personal Income Tax Declarations By Laszlo Goerke
  6. The Tax System Incidence on Unemployment: A Country-Specific Analysis for the OECD Economies By José Ramón García; Hector Sala
  7. $2.00 Gas! Studying the Effects of Gas Tax Moratorium By Joseph J. Doyle, Jr.; Krislert Samphantharak
  8. Regulation and Taxation of Casinos under State-Monopoly, Private Monopoly and Casino Association Regimes By Hasret Benar; Glenn Jenkins
  9. Demographics and the politics of capital taxation in a life-cycle economy By Mateos-Planas, Xavier
  10. Renegotiation Without Holdup: Anticipating Spending and Infrastructure Concessions By Eduardo Engel; Ronald Fischer; Alexander Galetovic
  11. Ratcheting in Renewable Resources Contracting By Urs Steiner Brandt; Frank Jensen; Lars Gårn Hansen; Niels Vestergaard
  12. Is public capital productive in Europe? By Jerome Creel; Gwenaëlle Poilon
  13. Reforming Federalism German Style - A First Step in the Right Direction By Thomas Döring; Stefan Voigt
  14. The Limits of Self-Governance in the Presence of Spite: Experimental Evidence from Urban and Rural Russia By Simon Gächter; Benedikt Herrmann
  15. Social Assistance Policy Development and the Provision of a Decent Level of Income in Selected OECD Countries By Willem Adema
  16. "Wage Growth and the Measurement of Social Security's Financial Condition" By Jagadeesh Gokhale
  17. Smallholder Farming Under Increasingly Difficult Circumstances: Policy and Public Investment Priorities for Africa By T.S. Jayne; D. Mather; E. Mghenyi
  18. Higher education: Time for coordination on a European level? By Laura Thissen; Sjef Ederveen
  19. Consensual and Conflictual Democratization By Matteo Cervellati; Piergiuseppe Fortunato; Uwe Sunde
  20. Dynamic environmental policy in developing countries in the presence of a balance of trade deficit and a tariff By A. Batabyal; H. Beladi; D. Lee
  21. Wage Drift In the Public Sector In Portugal: the Case of University Professors By Alfredo M. Pereira; Rui Manuel Pereira
  22. Retirement and the Poverty of the Elderly in Portugal By Paula Albuquerque; Manuela Arcanjo; Vítor Escária; Francisco Nunes; José Pereirinha
  23. New Technology in Schools: Is There a Payoff? By Stephen Machin; Sandra McNally; Olmo Silva
  25. The Effect of Professional Sports on the Earnings of Individuals: Evidence from Microeconomic Data By Dennis Coates; Brad R. Humphreys
  26. Bargaining with a Bureaucrat By Yair Tauman; Andriy Zapechelnyuk

  1. By: Alfredo M. Pereira (Department of Economics, College of William and Mary); Oriol Roca Sagales (Departament d'Economia Aplicada, Universitat Autonoma de Barcelona)
    Abstract: This paper estimates the effects on output of different fiscal policies in the context of a VAR model that includes several public spending and taxation variables. Empirical results suggest that the effects of fiscal policies are within the Keynesian paradigm for both direct and indirect taxes and for some but not all expenditure instruments. Indeed, while the results for public wages and public investment are Keynesian in nature, non-Keynesian effects dominate in the case of public transfers and possibly in the case of intermediate consumption. Finally, public investment shows particularly strong positive effects while direct taxation shows particularly strong negative effects.
    Keywords: Fiscal policy, budgetary restraint
    JEL: E62 H60
    Date: 2006–07–25
  2. By: James Giesecke; Peter B. Dixon; Maureen T. Rimmer
    Abstract: Many studies have found that the economic benefits from investment in urban infrastructure are substantial. In Australia, much of the responsibility for the provision of urban infrastructure rests with regional governments. Throughout the1990's many of these governments embarked on a program of fiscal restraint, seeking to restore financial positions weakened by exposure to failed government enterprises. A large proportion of this fiscal adjustment appears to have been borne by spending on public infrastructure. Today, regional government policy attention is again focussing on public infrastructure. In spite of the now robust fiscal positions of Australia's regional governments, they remain reluctant to finance infrastructure through debt, and raising the rates of existing taxes is perceived as politically unpopular. Instead, governments are exploring alternative financing instruments, such as developer charges and public-private partnerships. This paper uses a dynamic multi-regional CGE model (MMRF) to evaluate the regional macroeconomic consequences of four methods of financing a program of regional government infrastructure provision. The methods are developer charges, debt, payroll tax and residential rates. We demonstrate that the net gains from a program of urban infrastructure development are quite sensitive to the chosen financing means. The net gains tend to be greatest under rates and debt financing, and least under developer charges.
    Keywords: multi-regional CGE, dynamic CGE, infrastructure finance,regional policy
    JEL: D58 R13 R51 R53
    Date: 2005–01
  3. By: Abraham Neyman; Tim Russo
    Abstract: We examine incentive-compatible mechanisms for fair financing and efficient selection of a public budget (or public good). A mechanism selects the level of the public budget and imposes taxes on individuals. Individuals’ preferences are quasilinear. Fairness is expressed as weak monotonicity (called scale monotonicity) of the tax imposed on an individual as a function of his benefit from an increased level of the public budget. Efficiency is expressed as selection of a Pareto-optimal level of the public budget. The budget deficit is the difference between the public budget and the total amount of taxes collected from the individuals. We show that any efficient scale-monotonic and incentive-compatible mechanism may generate a budget deficit. Moreover, it is impossible to collect taxes that always cover a fixed small fraction of the total cost.
    Date: 2006–06
  4. By: Sybren Cnossen
    Abstract: Later this year, the European Commission has to submit a report to the Council of Ministers and the European Parliament with its views on tobacco tax policy in the EU. A 2004 publication issued by the Commission expressed the beliefs that tobacco consumption should be controlled by increasing tobacco excises and that harmonisation should proceed on the basis of specific rates. This paper reviews and evaluates EU tobacco tax policies. It supports the move towards specific taxation, but notes that there are conceptual and empirical limits to excessively high tobacco taxes. Smokers appear to pay their way and cigarette smuggling is a growing menace to health and revenue objectives.
    Keywords: tobacco taxation; European Union
    JEL: H2 H8
    Date: 2006–07
  5. By: Laszlo Goerke (University of Tübingen, CESifo and IZA Bonn)
    Abstract: Decisions by firms and individuals on the extent of their tax payments have generally been treated as separate choices. Empirically, a positive relationship between corporate and personal income tax evasion can be observed. The theoretical analysis in this paper shows that a manager's decision on the firm's behaviour will be independent of his personal preferences if the gain from reducing corporate tax payments is certain, as in the case of tax avoidance. If, however, the firm evades taxes so that the manager's income depends on whether the firm's activities are detected or not, corporate and personal income tax evasion choices cannot be separated.
    Keywords: firms, individuals, tax evasion, uncertainty
    JEL: H24 H25 H26
    Date: 2006–07
  6. By: José Ramón García (Universitat de València); Hector Sala (Universitat Autònoma de Barcelona and IZA Bonn)
    Abstract: This paper provides a detailed analysis on the incidence of the tax structure on the labor market. To do so it goes beyond the traditional examination of the ‘level’ effect of the fiscal wedge and considers a ‘composition’ effect defined as a payroll tax bias (PTB): the proportion of payroll taxes paid by employees with respect to the one paid by firms. We develop a right-to-manage model encompassing different wage bargaining systems and the incidence of different type of taxes. Controlling for demand-side and supply-side determinants of unemployment, we show that the PTB plays a significant role in explaining unemployment in the continental European countries, but not in the Nordic nor the Anglo- Saxon ones. We also show that there is no relationship between the incidence of the PTB and unemployment persistence, even though there is a positive one with respect to the level of the fiscal wedge.
    Keywords: unemployment, unemployment persistence, fiscal wedge, payroll tax bias
    JEL: E24 E62
    Date: 2006–07
  7. By: Joseph J. Doyle, Jr.; Krislert Samphantharak
    Abstract: Despite the considerable attention paid to the theory of tax incidence, there are surprisingly few estimates of the pass-through rate of sales taxes on retail prices. This paper estimates the effect of a suspension and subsequent reinstatement of the gasoline sales tax in Illinois and Indiana on retail prices. Earlier laws set the timing of the reinstatements, providing plausibly exogenous changes in the tax rates. Using a unique dataset of daily gasoline prices at the station level, retail gas prices are found to drop by 3% following the elimination of the 5% sales tax, and increase by 4% following the reinstatements, compared to neighboring states. Some evidence also suggests that the tax reinstatements are associated with higher prices up to an hour into neighboring states, which provides some evidence on the size of the geographic market for gasoline. Effects across different competitive environments are considered as well.
    Date: 2005–12
  8. By: Hasret Benar (Eastern Mediterranean University); Glenn Jenkins (Queen's University)
    Abstract: This paper considers alternative forms of regulation and taxation of the casino sector. The model considers the situation of a typical tourist destination country that is using casinos to attract and entertain foreign tourists. The objective is to invest in the sector efficiently while maximizing the amount of government revenue or profits accruing to the country. The regulator must determine how the price of gambling will be set, how many casinos will be allowed to enter the industry and the form and rates of taxation. Four alternative forms of regulation are considered: price regulation, state-owned monopoly, private monopoly and casino association regulation. Turnover taxes on the amount of funds gambled and also annual taxation of the fixed costs of the casinos are evaluated. Applications of the models are carried out for North Cyprus. The conclusion is that the economic efficiency costs and the revenue losses from the absence of effective regulation in these tourist destinations can be very substantial with welfare costs equal to the approximately 75 percent of the tax revenue generated by this sector. Furthermore it shows that while a tax on turnover can be efficient in the case of a competitive industry or a cartel association form of regulation, it will be distortionary if a multi-plant private monopoly is controlling the sector. In contrast a tax on fixed costs will lead to an efficient result in the case of a competitive industry, but it will lead to economic inefficiencies if the sector is regulated by a casino association that controls the number of casino entering the sector.
    Keywords: Casino regulation, taxation, state-monopoly, welfare cost
    JEL: H21 H32
    Date: 2006–07
  9. By: Mateos-Planas, Xavier
    Abstract: This paper investigates the consequences of changes in the age composition of the population for the mix of tax rates on labour and capital income when these policies are decided through democratic institutions. The analysis is conducted within a general equilibrium, overlapping-generations model where agents live for many periods, and tax rates are determined through voting by forward looking agents. A version of the model calibrated to the US economic conditions and 1990 age structure is used to study quantitatively the effects of past and projected demographic shifts in the US. The younger voting-age population in 1990 relative to 1965 can account for the large decline in the relative capital tax rate observed between these two years. The older voting-age population expected in 2025 is shown to lead to a sharp increase in capital taxation. These results reflect the tension between the induced changes in the decisive voter's age and in macroeconomic conditions.
  10. By: Eduardo Engel; Ronald Fischer; Alexander Galetovic
    Abstract: Infrastructure concessions are frequently renegotiated after investments are sunk, resulting in better contractual terms for the franchise holders. This paper offers a political economy explanation for renegotiations that occur with no apparent holdup. We argue that they are used by political incumbents to anticipate infrastructure spending and thereby increase the probability of winning an upcoming election. Contract renegotiations allow administrations to replicate the effects of issuing debt. Yet debt issues are incorporated in the budget, must be approved by Congress and are therefore subject to the opposition’s review. By contrast, under current accounting standards the obligations created by renegotiations circumvent the budgetary process in most countries. Hence, renegotiations allow incumbents to spend more without being subject to Congressional oversight.
    JEL: H21 L51 L91
    Date: 2006–07
  11. By: Urs Steiner Brandt (Department of Environmental and Business Economics, University of Southern Denmark); Frank Jensen (Institute of Local Government Studies, Denmark); Lars Gårn Hansen (Institute of Local Government Studies, Denmark); Niels Vestergaard (Department of Environmental and Business Economics, University of Southern Denmark)
    Abstract: Real life implies that public procurement contracting of renewable resources results in repeated interaction between a principal and the agents. The present paper analyses ratchet effects in contracting of renewable resources and how the presence of a resource constraint alters the “standard” ratchet effect result. We use a linear reward scheme to influence the incentives of the agents. It is shown that for some renewable resources we might end up both with more or with less pooling in the first-period compared to a situation without a resource constraint. The reason is that the resource constraint implies a smaller performance de-pendent bonus, which reduces the first-period cost from concealing information but at the same time the resource constraint may also imply that second-period benefits from this concealment for the efficient agent are reduced. In situations with high likelihood of first-period pooling, the appropriateness of applying lin-ear incentive schemes can be questioned.
    Keywords: Political support function, political economy, environmental regula-tion, lobbyism, rent-seeking, taxation, auction, grandfathering, emission trad-ing, European Union, interest groups, industry, consumers, environmentalists
    JEL: Q28 H2 H4
    Date: 2004–09
  12. By: Jerome Creel (Observatoire Français des Conjonctures Économiques); Gwenaëlle Poilon (Sciences Po)
    Abstract: This paper addresses the issue of whether and by how much public investment or public capital can enhance economic performance. In comparison with the literature on the subject, we apply many different methodologies to answer these questions. A VAR model (for France, Italy, Germany, the UK and the USA), a panel composed of 6 European countries (Austria, Belgium, France, Germany, Italy and the Netherlands) and a regional panel (French regions) are therefore estimated. Public investment is shown to be a significant determinant of output; this is also true for public capital but to a lesser extent than public investment with a VAR methodology. The size of the estimated coefficient is also more realistic than those obtained in the literature. This empirical result confirms that the focus of some economists on safeguarding the level of public investment is not misplaced. The debate on the introduction of a “golden rule of public finance” in EMU is legitimate.
    Keywords: public capital, VAR model, panel, European economies
    JEL: C32 E62 H54
    Date: 2006
  13. By: Thomas Döring (Department of Economics, University of Kassel); Stefan Voigt (Department of Economics, University of Kassel)
    Abstract: The German version of federalism, often called "cooperative federalism", has been identified by many as one of the root causes for Germany becoming Europe’s new sick man. Now, a number of changes in the institutions defining the relationship between the federal, the state and the local level have been passed. This contribution describes the most important changes and evaluates them from the point of view of fiscal federalism. It concludes that the changes are only a first step in the right direction, but a number of important steps have yet to follow.
    Date: 2006–08
  14. By: Simon Gächter (University of Nottingham, CESifo and IZA Bonn); Benedikt Herrmann (University of Nottingham)
    Abstract: We report evidence from public goods experiments with and without punishment which we conducted in Russia with 566 urban and rural participants of young and mature age cohorts. Russia is interesting for studying voluntary cooperation because of its long history of collectivism, and a huge urban-rural gap. In contrast to previous experiments we find no cooperation-enhancing effect of punishment. An important reason is that there is substantial spiteful punishment of high contributors in all four subject pools. Thus, spite undermines the scope for self-governance in the sense of high levels of voluntary cooperation that are sustained by sanctioning free riders only.
    Keywords: social norms, free riding, punishment, spite, experiments
    JEL: H41 C91 D23 C72
    Date: 2006–07
  15. By: Willem Adema
    Abstract: The paper starts with a brief look at social expenditure patterns and the importance of different social policy areas, in particular the role of social assistance policy within social protection systems. It then looks at the objectives of social assistance policy and considers payment-rates in terms of adequacy, financial incentives to work, addressing issues as budget standards, indexation methods and the policy approach towards specific client groups. Also, the study briefly highlights Chinese public expenditure issues more generally and presents some key indicators on the dynamics of ageing populations which will have consequences for future social expenditure trends in China.
    JEL: H53 I31 I38
    Date: 2006–08–01
  16. By: Jagadeesh Gokhale
    Abstract: Government spending on the elderly is projected to increase rapidly as the U.S. population becomes older, and many policymakers and budget analysts are concerned about the continued viability of entitlement programs such as Social Security. The Social Security trustees’ economic growth projections receive considerable attention because many people believe that higher growth would significantly improve the program’s actuarial balance (that is, reduce its actuarial deficit). This belief is validated by Social Security trustees’ calculations that show larger 75-year actuarial balances under faster assumed real wage growth rates. Since 2003 the trustees have reported the program’s actuarial balance measured in perpetuity. But they do not provide sensitivity analysis that examines the impact of various assumptions on the infinite-term actuarial balance. This paper shows analytically that faster wage growth may reduce Social Security’s infinite-term actuarial balance if the ratio of workers to retirees continues to decline rapidly beyond the 75th year. This result holds even if the decline in that ratio ceases after just two decades beyond the 75th year. The paper reports stylized calculations of the impact of real wage growth and demographic change–including time-varying rates of change based on official projections for the U.S. economy–on Social Security’s actuarial balance in a multi-period setting. Finally, the Social Security and Accounts Simulator (SSASIM) actuarial model of Social Security financing is used to estimate the degree to which increased wage growth could negatively affect the system’s infinite-term actuarial balance. These results raise questions about the conventional wisdom that holds that improved wage growth would affect Social Security’s financing, and how a widely used measure of Social Security’s financing captures those effects.
    Date: 2006–07
  17. By: T.S. Jayne (Department of Agricultural Economics, Michigan State University); D. Mather; E. Mghenyi
    Abstract: This paper identifies major trends affecting the future of the small farm in Sub-Saharan Africa, and identifies policy responses and public investment strategies by African governments, governments of high-income countries, and multilateral donors that can give African smallholders the chance to be viable in an increasingly globalized world.
    Keywords: food security, food policy, agriculture policy
    JEL: Q18
    Date: 2006
  18. By: Laura Thissen; Sjef Ederveen
    Abstract: Education has always been regarded as a national matter. According to the subsidiarity principle power may only be shifted to a higher level of coordination when solid arguments exist that this will improve welfare. This paper aims at answering the question if these arguments exist. We find no support for economies of scale, i.e. larger countries do not necessarily provide higher quality education; nor do larger schools. Empirical evidence for human capital externalities through student mobility is scarce. Concluding, we find little support for European coordination of higher education. However, there is evidence that student mobility is a precursor for labour migration. Uniformizing the structure of higher education in the EU, and making educational programs more transparent, may therefore be defended from this perspective. Quality does matter for students, and student mobility is increasing. This may be beneficial to labour mobility.
    Keywords: Subsidiarity; European coordination; Higher education; Student migration
    JEL: F22 H87 I2 J61
    Date: 2006–07
  19. By: Matteo Cervellati (University of Bologna, IAE Barcelona and IZA Bonn); Piergiuseppe Fortunato (University of Bologna); Uwe Sunde (IZA Bonn and University of Bonn)
    Abstract: We study the process of endogenous democratization from inefficient oligarchic systems in an economy where heterogeneous individuals can get involved in predation activities. The features of democracies are shown to be crucially related to the conditions under which democratization initially takes place. The political regime and the extent of redistribution implemented under it depend on the allocation of de facto political power across the different social groups. The cost of public enforcement of property rights depends on the extent of predation activities in the economy. The theory highlights the importance of inequality in natural resources and availability of human capital for endogenous democratic transitions. Multiple politico-economic equilibria can be sustained conditional on expectations about property rights enforcement. This generates history dependence. Democratic transitions supported by a large consensus serve as coordination device and lead to better protection of property and more stable political systems than democratic transitions imposed in conflictual environments. We test the novel predictions using available cross-country data. The link between the type of democratic transition and the outcomes under democracy is also investigated using novel data on constitutional principles. The findings support the theoretical predictions.
    Keywords: democratization, oligarchy, conflict, consensual democracy, inequality, commitment, constitutional principles
    JEL: H10 O20 N10
    Date: 2006–07
  20. By: A. Batabyal; H. Beladi; D. Lee
    Abstract: We first review the literature pertaining to the protection of the modern sector in developing countries (DCs). We then discuss the nexuses between protection, economic dualism, and optimal environmental policy in DCs. Next, in the theoretical part of the paper, we construct a dynamic model of the environmental policy formulation process in a stylized DC in which there is a balance of trade deficit, and a tariff that protects the modern—also the import competing and the polluting—sector. The employment and output effects of three different pollution taxes are analyzed. These taxes incorporate different assumptions about the DC government’s ability to commit to its announced course of action. The taxes are characterized, the dependence of these taxes on the extant tariff is studied, and the conditions that call for an activist policy, irrespective of the length of time to which the government can commit to its announced policy, are specified. Our analysis shows that the dynamic inconsistence of some optimal programs and the existence of the tariff can—either singly or collectively—prevent the DC government from attaining its employment and environmental goals.
    Keywords: commitment, developing country, environmental policy, tariff, trade deficit
    JEL: O20 Q20
  21. By: Alfredo M. Pereira (Department of Economics, College of William and Mary); Rui Manuel Pereira (Faculdade de Ciencias e Tecnologia, Universidade Nova de Lisboa)
    Abstract: Public sector wages are a large and growing share of the public budget in Portugal. This means that current efforts to achieve budgetary consolidation have necessarily to include controlling the public wage bill, which has been typically attempted through hiring freezes. The evolution of the wage bill, however, is conditioned by a system of career progressions and promotions, which are expected to lead to an increasing wage bill even in the presence of constant public employment. This is what we refer to as the wage drift. In this paper we estimate the wage drift in the case of university professors. We use a logit analysis using 1999 census data to find that individuals who have been in their career for a relatively long time are statistically more likely to progress as opposed to being promoted while those who are promoted tend to do so at an earlier stage of their career and to spend less time in each position. With this information we infer the employment distribution in 1996 and 1993 under the assumption of a fixed employment population and determine the corresponding wage bill. We estimate that without entries into or exits out of the system, public spending on university professor wages would grow at an average yearly rate of 2.6%, well above the GDP growth rate. The overall message of the paper is to sound the alarm that simply freezing recruiting and discretionary wage increases may be insufficient to stem the tide of growth in the public wage bill.
    Keywords: Wage drift, public sector wages, employment promotion, budgetary restraint
    JEL: H60 J30 J45 J62
    Date: 2006–07–25
  22. By: Paula Albuquerque; Manuela Arcanjo; Vítor Escária; Francisco Nunes; José Pereirinha
    Abstract: The effect of retirement on economic welfare, indirectly measured by income, has not been studied widely, namely due to the lack of longitudinal data. A large literature exists about poverty in old age, mainly based on cross sectional survey data, but usually those studies are not able to study the transitional effect of retirement on income as they do not observe the workers who do retire before and after their retirement. The knowledge of this phenomenon is, however, of crucial relevance given the growing number of elderly people, the trend towards earlier retirement, and continuing relatively high poverty rates among the elderly. This paper analyses the association between transitions into retirement and the probability of becoming poor, considering different definitions of low income and of retirement, following what has been proposed in the literature. It is based on longitudinal data from the European Community Household Panel (ECHP) for Portugal survey waves 1-8 covering 1994-2001. Taking advantage of the longitudinal nature of the data used, we consider how the process of becoming retired is associated with an increased risk of having a low income, focusing on changes in the years immediately before and immediately after retirement for people who retire. The analysis is then focused on a sample of people who do retire during the analysed period. The paper starts by presenting evidence comparing low income incidence among retired people and the rest of the population on each of the waves of ECHP. Afterwards it analyses some factors associated with the changes in individuals’ income over a number of years around retirement. The dynamics of household income changes for people who retire are studied and which personal and household characteristics are associated with a higher risk of having low income in the years around retirement are explored. Finally, a multivariate probit model of the probability of entering low income at the time of retirement conditional on not having a low income before retirement is estimated.
    Keywords: Retirement; poverty dynamics; Portugal; old-age social protection; income mobility.
    JEL: H55 I32 J14 J26
  23. By: Stephen Machin (University College London, CEE, CEP, London School of Economics and IZA Bonn); Sandra McNally (CEE, CEP, London School of Economics and IZA Bonn); Olmo Silva (CEE, CEP, London School of Economics, European University Institute and IZA Bonn)
    Abstract: Despite its high relevance to current policy debates, estimating the causal effect of Information Communication Technology (ICT) investment on educational standards remains fraught with difficulties. In this paper, we exploit a change in the rules governing ICT funding across different school districts of England to devise an instrumental variable strategy to identify the causal impact of ICT expenditure on pupil outcomes. The approach identifies the effect of being a ‘winner’ or a ‘loser’ in the new system of ICT funding allocation to schools. Our findings suggest a positive impact on primary school performance in English and Science, though not for Mathematics. We reconcile our positive results with others in the literature by arguing that it is the joint effect of large increases in ICT funding coupled with a fertile background for making an efficient use of it that led to positive effects of ICT expenditure on educational performance in English primary schools.
    Keywords: Information and Communication Technology (ICT), pupil achievement
    JEL: H52 I20 I28 J24
    Date: 2006–07
  24. By: L. Randall Wray
    Abstract: Demographers and economists agree that we are aging--individually and collectively, nationally and globally. An aging population results from the twin demographic forces of fewer children per family and longer lives. Most experts recognize the burden that aging causes as the number of retirees supported by each worker rises. This trend is reinforced by the graying of the baby-boom generation, but burdens will continue to rise even after the boomers are buried--albeit at a slower pace.
    Date: 2006–07
  25. By: Dennis Coates (Department of Economics, University of Maryland, Baltimore County); Brad R. Humphreys (Department of Recreation, Sport and Tourism, University of Illinois)
    Abstract: This paper explores the impact of professional sports teams and stadiums on the wages of individuals employed in several narrowly defined occupational groups in cities in the United States. The occupational groups examined are among those that proponents of public funding of professional sports claim will benefit economically from these stadiums. Our analysis uses data from the March Supplement to the Current Population Survey (CPS) for the period 1983 to 1998. Previous research focused on aggregate measures of income whereas here the focus is on the wages of individual workers. The results of the study conform conclusions of earlier research that the overall sports environment is frequently statistically significant as a determinant of earnings.
    JEL: L83 R58 J30 H71
    Date: 2006–07
  26. By: Yair Tauman; Andriy Zapechelnyuk
    Abstract: We consider a bargaining problem where one of the players, the bureaucrat, has the power to dictate any outcome in a given set. The other players, the agents, negotiate with him which outcome to be dictated. In return, the agents transfer some part of their payoffs to the bureaucrat. We state ?five axioms and characterize the solutions which satisfy these axioms on a class of problems which includes as a subset all submodular bargaining problems. Every solution is characterized by a number <FONT FACE="Symbol">a</FONT> in the unit interval. Each agent in every bargaining problem obtains a weighted average of his individually rational level and his marginal contribution to the set of all players, where the weights are <FONT FACE="Symbol">a</FONT> and 1 - <FONT FACE="Symbol">a</FONT>, respectively. The bureaucrat obtains the remaing surplus. The solution when <FONT FACE="Symbol">a</FONT> = 1/2 is the nucleolus of a naturally related game in characteristic form.
    Date: 2006–06

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