|
on Urban and Real Estate Economics |
| By: | Séverine CAUCHIE (HEC-University of Geneva); Martin HOESLI (HEC-University of Geneva, FAME and University of Aberdeen (School of Business)) |
| Abstract: | Empirical evidence suggests that U.S. REITs are integrated with common stocks, but not with bonds. The design of the real estate security is likely to impact upon results, however, and it would seem important to analyze the topic of integration for another type of real estate security. Swiss real estate funds constitute an ideal candidate for such an examination as their institutional and legal setup differs substantially from that of other countries. We analyze the integration of such funds with both the stock and bond markets using an APT framework. We employ both the Xu (2003) method and an innovative procedure to determine endogenous and exogenous factors, respectively. Integration is assessed by means of two alternative tests. Our results suggest that Swiss real estate funds are more integrated with stocks than with bonds. Further, we show that the degree of integration between real estate and stocks is due to a stock market factor and changes in expected inflation. No integrating factor is found between real estate and bond funds. Finally, it is found that unexpected inflation is a segmenting factor between real estate securities and financial assets. |
| Keywords: | Securitized Real Estate; Statistical APT; Macroeconomic APT; Market Integration; Risk Factors |
| JEL: | G12 |
| Date: | 2004–06 |
| URL: | http://d.repec.org/n?u=RePEc:fam:rpseri:rp111&r=ure |
| By: | Paul EHLING (Penn State University, Smeal College); Sofia B. RAMOS (ISCTE Business School) |
| Abstract: | This research addresses whether geographic diversification provides benefits over industry diversification in a sample of European country and industry indexes. The methodology allows performance comparisons with short-selling constraints, upper and lower bounds, and many benchmarks. In the absence of constraints, no empirical evidence is found to support the argument that country diversification is a superior approach. In the case of realistic weights on portfolios such as short-selling, and lower or upper bonds, geographic diversification performs (sig-nificantly) better. The contrary results appear to be attributable to the fact that industry portfolios are better suited to eliminate the single dominant factor risk in stock returns. Further out-of-sample analysis shows that geographic diversification performs better, although the tests do not show statistical significance. |
| Keywords: | Diversification gains; EMU; Geographic diversification; Industry diversification |
| JEL: | G11 G15 |
| Date: | 2004–08 |
| URL: | http://d.repec.org/n?u=RePEc:fam:rpseri:rp113&r=ure |
| By: | Angela Black (University of Aberdeen Business School); Patricia Fraser (University of Aberdeen Business School); Martin Hoesli |
| Abstract: | This paper studies actual house prices relative to fundamental house prices. Using UK data and a time-varying present value approach, we find that deviations of house prices fromtheir fundamental value (as warranted by real disposable income) are significant but not dominated by speculative activity; the driving force appears to be over-sensitivity to expectations over fundamentals. Our findings suggest that inflation (excluding house prices) responds asymmetrically with more impact on future inflation from turning points at peaks of overevaluation compared to turning points at troughs of underevaluation; and the turning points appear to have independent forecasting ability for inflation. This suggests that house prices have information about inflation which could be exploited by the MOnetary Policy Committee (MPC). |
| Keywords: | House Prices, Fundamentals, Inflation, Monetary Policy |
| JEL: | E52 E58 R31 |
| URL: | http://d.repec.org/n?u=RePEc:fam:rpseri:rp129&r=ure |
| By: | Foort HAMELINK (Lombard Odier & Cie, Vrije Universiteit and FAME); Martin HOESLI (HEC-University of Geneva, FAME and University of Aberdeen) |
| Abstract: | We use constrained cross-section regressions to disentangle the effects of various factors on international real estate security returns. Besides a common factor, pure country, property type, size, and value/growth factors are considered. The value/growth measure that is used in this paper provides for each security the relative importance of the value and growth components, rather than a binary classification. The value/growth factor is found to be volatile and to have a substantial effect on returns over the analyzed period February 1990-April 2003. Country factors are the dominant factors, and size is shown to have a negative impact on returns. Statistical factors derived by means of cluster analysis explain about one third of specific returns on international real estate securities. The implication for portfolio managers is that failing to recognize the importance of the various factors leads to the portfolio being exposed to systematic risk. |
| Keywords: | securitized real estate, international diversification, multi-factor model, value/growth |
| JEL: | C21 G11 G15 |
| Date: | 2003–07 |
| URL: | http://d.repec.org/n?u=RePEc:fam:rpseri:rp50&r=ure |
| By: | Martin Hoesli (HEC-University of Geneva, FAME and University of Aberdeen School of Business); Jon Lekander (Aberdeen Property Investors Nordic Region); Witold Witkiewicz (Europa Capital Partners) |
| Abstract: | This paper provides an international comparison of the benefits of including real estate assets – both domestic and international – in mixed-asset portfolios. Data from seven countries on three continents are considered for a common time period (1987-2001) to facilitate comparisons. Real estate returns are desmoothed using a variant of the Geltner (1993) approach, and Bayes-Stein estimators are used to increase the stability of portfolio weight estimations. Both unhedged and hedged analyses are conducted. Real estate is found to be an effective portfolio diversifier, and even more so when both domestic and international real estate assets are considered. The optimal allocation to real estate is in the 15 to 25% range, and remains remarkably constant in the various analyses. The breakdown of the real estate allocation between domestic and non-domestic assets, however, is found to vary substantially across countries and depending on whether returns are hedged or not. |
| Date: | 2003–07 |
| URL: | http://d.repec.org/n?u=RePEc:fam:rpseri:rp70&r=ure |
| By: | Steven C. Bourassa (School of Urban and Public Affairs, University of Louisville); Martin Hoesli (HEC-University of Geneva, FAME and University of Aberdeen Business School); Jian Sun (School of Urban and Public Affairs, University of Louisville) |
| Abstract: | The impact of views on property values has not been the specific focus of as much research as has the impact of other externalities on property values. When the impact of views is assessed, it is usually done by adding a single dummy variable to a hedonic regression equation. This paper provides a detailed literature review as well as an empirical analysis of the impact of a view on residential property values using a very rich database of nearly 5,000 sales in Auckland, New Zealand. Several dimensions of a view are analyzed: type of view, scope of view, distance to coast, appearance of immediately surrounding improvements, average quality of landscaping in the neighborhood, and average quality of structures in the neighborhood. It is found that wide views of water add an average of 59% to the value of a waterfront property, but that this effect diminishes quite rapidly as the distance from the coast increases. Attractive buildings in a property’s neighborhood on average add 37% to value relative to properties in neighborhoods with only average quality structures. Particularly attractive improvements in the immediate surroundings of a property add another 27% to value on average. On the other hand, properties in neighborhoods with only poor quality landscaping on average experience a -51% impact on price. Our results lead to the conclusion that aesthetic externalities are multi-dimensional and can have a substantial impact on residential property values. |
| Date: | 2003–11 |
| URL: | http://d.repec.org/n?u=RePEc:fam:rpseri:rp79&r=ure |
| By: | Foort HAMELINK (Lombard Odier Darier Hentsch, Vrije Universiteit and FAME); Martin HOESLI (HEC-University of Geneva, FAME, and University of Aberdeen (School of Business)) |
| Abstract: | We investigate the role of real estate in a mixed-asset portfolio when the maximum drawdown (hereafter MaxDD), rather than the standard deviation, is used as the measure of risk. In particular, we analyse whether the discrepancy between the optimal allocation to real estate and the actual allocation by institutional investors is less when a Return/MaxDD framework is used. The empirical analysis is conducted from the perspective of a Swiss investor using international data for the period 1979-2002. We show that most portfolios optimised in Return/MaxDD space, rather than in Return/Standard Deviation space, yield a much lower MaxDD, while only a slightly higher standard deviation (for the same level of return). The reduction in MaxDD is highest for portfolios situated half-way on the efficient frontier, typically close to those held by pension funds. Also, the reported weights for real estate are much more in line with the actual weights to real estate by institutional investors. |
| Keywords: | Maximum Drawdown, Downside Risk, Portfolio Diversification, Real Estate |
| JEL: | G11 |
| Date: | 2003–11 |
| URL: | http://d.repec.org/n?u=RePEc:fam:rpseri:rp87&r=ure |
| By: | Furstenberg, Frank F. , Jr. (University of Pennsylvania); Neumark, David (Public Policy Institute of California, NBER and IZA Bonn) |
| Abstract: | We study a set of programs implemented in Philadelphia high schools that focus on boosting post-secondary enrollment. These programs are less career oriented than traditional schoolto- work programs, but are consistent with the broadening of the goals of school-to-work to emphasize post-secondary education. The Philadelphia Longitudinal Educational Study (PELS) data set that we examine contains an unusually large amount of information on individuals prior to placement in STC programs. We use the detailed information in the PELS to study the process of selection into these programs and to examine their impact on a set of mainly schooling-related outcomes during and after high school, although we also consider their impact on non-academic outcomes. The data point to positive effects of these programs on high school graduation and on both academic and non-academic awards in high school, and similar negative effects on dropping out of high school. The results also suggest positive effects on aspirations for higher education and on college attendance. In addition, there is some evidence that these programs are more effective in increasing college attendance and aspirations among at-risk youths. |
| Keywords: | school-to-career, education |
| JEL: | I28 J24 |
| Date: | 2005–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1552&r=ure |
| By: | Christelle Dumas; Sylvie Lambert |
| Abstract: | This paper aims at studying the relationship between schooling and family background characteristics. The econometric analysis uses an original survey conducted in 2003 in Senegal that, uniquely, provides instruments permitting to deal with the endogeneity of background variables. The estimated effect of father’s education more than doubles when its endogeneity is accounted for. We also present results suggesting that family background has as much impact after entry at school than at younger ages, and that parental education affects children schooling through its contribution to parental preferences (and not only through higher efficiency in the production of human capital). |
| Keywords: | schooling mobility, education demand |
| JEL: | D12 I21 O12 |
| Date: | 2005–04 |
| URL: | http://d.repec.org/n?u=RePEc:lea:leawpi:0503&r=ure |
| By: | Federico Echenique; Roland G. Fryer, Jr. |
| Abstract: | This paper develops a measure of segregation based on two premises: (1) a measure of segregation should disaggregate to the level of individuals, and (2) an individual is more segregated the more segregated are the agents with whom she interacts. Developing three desirable axioms that any segregation measure should satisfy, we prove that one and only one segregation index satisfies our three axioms, and the two aims mentioned above; which we coin the Spectral Segregation Index. We apply the index to two well-studied social phenomena: residential and school segregation. We calculate the extent of residential segregation across major US cities using data from the 2000 US Census. The correlation between the Spectral index and the commonly-used dissimilarity index is .42. Using detailed data on friendship networks, available in the National Longitudinal Study of Adolescent Health, we calculate the prevalence of within-school racial segregation. The results suggests that the percent of minority students within a school, commonly used as a substitute for a measure of in-school segregation, is a poor proxy for social interactions. |
| JEL: | Z13 C0 |
| Date: | 2005–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11258&r=ure |
| By: | Frank F. Furstenberg, Jr.; David Neumark |
| Abstract: | We study a set of programs implemented in Philadelphia high schools that focus on boosting post-secondary enrollment. These programs are less career oriented than traditional school-to-work programs, but are consistent with the broadening of the goals of school-to-work to emphasize post-secondary education. The Philadelphia Longitudinal Educational Study (PELS) data set that we examine contains an unusually large amount of information on individuals prior to placement in STC programs. We use the detailed information in the PELS to study the process of selection into these programs and to examine their impact on a set of mainly schooling-related outcomes during and after high school, although we also consider their impact on non-academic outcomes. The data point to positive effects of these programs on high school graduation and on both academic and non-academic awards in high school, and similar negative effects on dropping out of high school. The results also suggest positive effects on aspirations for higher education and on college attendance. In addition, there is some evidence that these programs are more effective in increasing college attendance and aspirations among at-risk youths. |
| JEL: | I28 J24 |
| Date: | 2005–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11260&r=ure |
| By: | Javier Escobal (GRADE); Sonia Laszlo (McGill University) |
| Abstract: | Studies in the microeconometric literature increasingly utilize distance to or time to reach markets or social services as determinants of economic issues. These studies typically use self-reported measures from survey data, often characterized by non-classical measurement error. This paper is the first validation study of access to markets data. New and unique data from Peru allow comparison of self-reported variables with scientifically calculated variables. We investigate the determinants of the deviation between imputed and self-reported data and show that it is non-classical and dependent on observable socio-economic variables. Our results suggest that studies using self-reported measures of access may be estimating biased effects. |
| JEL: | O P |
| Date: | 2005–03–29 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpdc:0503008&r=ure |
| By: | Fabio Sabatini (University of Rome La Sapienza) |
| Abstract: | The aim of this paper is to trace a map of Italian local social capital endowments. It focuses on the “structural” dimension of the concept, as identified with social networks. The analysis is based on a dataset collected by the author including about two hundred indicators of five main social capital dimensions: strong family ties, weak informal ties, voluntary organizations, civic awareness, and political participation. 51 key variables are selected for performing principal component analyses both on each of the five groups and on the entire dataset, in order to build latent indicators for every single social capital’s dimension and for the concept as a whole. Finally, a multiple factor analysis is run on the entire dataset, in search of a single synthetic measure of social capital. A clear distinction emerges between bonding social capital, shaped by strong family ties, and bridging and linking social capital, shaped by weak ties among friends, neighboors and members in voluntary organizations. Areas characterized by high levels of bonding social capital can suffer from a lack of bridging and linking ties. The study provides a valuable synthetic indicator capturing the particular configuration of social capital which the literature generally associates with positive economic outcomes. |
| Keywords: | Social capital, Social networks, Economic development, Principal component analysis, Multiple factor analysis |
| JEL: | A12 O10 O18 R11 |
| Date: | 2005–04–11 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpdc:0504003&r=ure |
| By: | Giovanis Elephtherios (Graduate from the University of Thessaly in city of Volos) |
| Abstract: | In this project we will analyse specific economic factors of O.U.T.A. (Organism of Urban and Transportations of Athens. O.U.T.A. is a legal person of private law and was established in according to the law 2175/1993, as a successor of O.U.T. . (Organism of Urban and Transportations). O.U.T. was established in according to the law 588/1977 as a full public enterprise, applicable under the principles of private economy and operational for the public benefit under the supervisor and the control of the Ministry of transportations and communications. O.U.T.A. as a maternal enterprise supervise four other companies, which they belong to O.U.T.A. There are U.T.B. (Union of thermal bushes), which concerns the control of thermal bushes, E.R.A.P. (Electric Railroad of Athens-Peraia ) which took over the control of the Electric railroad of Athens and also the control of the green bushes, D.E.B.A.P. (Driven by Electricity bushes of Athens-Peraia) the driven bushes by electricity with antennas and finally the A.M.C.F. (Attica Metro company function) which company is not anything else than the company that have taken over the control of the Metro function. In the first chapter we will analyse three models of adaptive expectations. The first model concerns the revenues, the second concerns investments and third concerns the costs. In the second chapter we will examine, with the help of dynamic Nerlove model, the adjustment of the real revenues at the desirable level. Also the same analysis will be done with the lending and the subsidy. We will examine the O.U.T.A. at the total of the same O.U.T.A. and the total of the other four enterprises, but we will examine also each of the four other companies. In chapter third we present simultaneous equations of revenues and investments. Finally , in fourth chapter is being reference to the Koyck model and the Almon technique. Specifically, we will present two models, which the first concerns, revenues and investments and the second model concerns revenues and the price of tickets. |
| Keywords: | basic econometrics |
| JEL: | C1 C2 C3 C4 C5 C8 |
| Date: | 2005–03–11 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpem:0503010&r=ure |
| By: | Catalina Amuedo-Dorantes (San diego State University); Kusum Mundra (San Diego State University) |
| Abstract: | We examine the impact of different types of social networks on the employment and wages of unauthorized and legal Mexican immigrants using data from the Mexican Migration Project. We find that social networks, particularly strong ties, contribute to the economic assimilation of immigrants by raising their hourly wages. However, networks do not enhance immigrants’ employability. Instead, strong ties allow for a lower employment likelihood possibly through the shelter against temporary unemployment provided by close family members. Finally, social networks do not alter the relative employment and earnings performance of unauthorized and legal immigrants in the absence of networks. |
| JEL: | J |
| Date: | 2005–02–09 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpla:0502001&r=ure |
| By: | Federico Echenique (California Institute of Technology); Roland G. Fryer Jr. (Harvard University Society of Fellows, & NBER) |
| Abstract: | This paper develops a measure of segregation based on two premises: (1) a measure of segregation should disaggregate to the level of individuals, and (2) an individual is more segregated the more segregated are the agents with whom she interacts. Developing three desirable axioms that any segregation measure should satisfy, we prove that one and only one segregation index satisfies our three axioms, and the two aims mentioned above; which we coin the Spectral Segregation Index. We apply the index to two well-studied social phenomena: residential and school segregation. We calculate the extent of residential segregation across major US cities using data from the 2000 US Census. The correlation between the Spectral index and the commonly- used dissimilarity index is .42. Using detailed data on friendship networks, available in the National Longitudinal Study of Adolescent Health, we calculate the prevalence of within-school racial segregation. The results suggests that the percent of minority students within a school, commonly used as a substitute for a measure of in-school segregation, is a poor proxy for social interactions. |
| Keywords: | segregation, networks, social interactions, school segregation, residential segregation |
| JEL: | C0 J15 |
| Date: | 2005–03–31 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpla:0503006&r=ure |
| By: | Bernhard Ganglmair (Bonn Graduate School of Economics) |
| Abstract: | New data from Uganda is used for the joint estimation of a household's child labor and child school attendance decision applying a bivariate probit model. Individual characteristics, income and asset variables as well as variables denoting household composition and number of siblings were used as regressors. Results implying a stronger trade-off between these two decisions in urban than rural areas and stronger for girls than for boys are obtained. Especially rural boys thus have a stronger tendency to combine their labor activities with schooling. This 'gender bias' is reinforced by a significantly strong effect of a household's wage income on boys' decisions, whereas girls are little or not affected at all. For girls, household composition and number of younger siblings are relatively more decisive. This also suggests a possible 'role order' among children within the household. |
| Keywords: | child labor, school attendance, decision trade-off, simultaneous labor--school decision, bivariate probit, Uganda |
| JEL: | C35 J43 |
| Date: | 2005–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpla:0504002&r=ure |
| By: | Ben Vollaard (CPB) |
| Abstract: | We present evidence on the effect of greater numbers of police personnel on crime and nuisance reduction in the Netherlands. We use a multiple time series design with police regions as the unit of analysis, covering the period 1996-2003. During this period, police resources increased substantially. The growth in additional resources differed greatly between regions, allowing us to use this policy intervention to identify the effect of police on crime and nuisance. We control for regional economic, social and demographic factors and for national trends that might obscure the effect of police on crime. We find significantly negative effects of higher police levels on property crime, violent crime and nuisance. Our estimates suggest that a substantial proportion of the decline in crime and nuisance during the period 1996-2003 is attributable to the increase in police personnel. |
| Keywords: | police, crime, nuisance, effectiveness, victimisation survey |
| JEL: | K4 |
| Date: | 2005–01–26 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwple:0501006&r=ure |
| By: | Ana María Cerro (Universidad Nacional de Tucumán); Osvaldo Meloni (Universidad Nacional de Tucumán) |
| Abstract: | Since Adam Smith, economists have emphasized income distribution and unemployment as key elements to explain criminal behavior. However, the empirical evidence did not always confirm such conjecture. Departing from the theoretical framework proposed by Becker (1968), the present paper identifies the determinants of the crime rate in Argentina using a panel data for 1990-99. As in previous papers studying the Argentina case, it is found that deterrence variables are important. However, unlike those papers, income distribution, unemployment and per capita GDP also played crucial roles, which has important implications for policy design. Classification JEL: K4, I3 |
| Keywords: | Crime rate, income distribution, unemployment, Argentina |
| JEL: | K |
| Date: | 2005–04–08 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwple:0504001&r=ure |
| By: | Suparna Chakraborty (University of Minnesota & Federal Reserve Bank of Minneapolis) |
| Abstract: | This paper investigates the causes of business cycle fluctuations that Japan experienced over the period 1980 to 2000. To this end, I build a dynamic general equilibrium model with endogenous borrowing constraints where business cycle fluctuations are the result of TFP fluctuations and investment frictions. I identify land tax changes since 1984 as a possible source of investment frictions, the idea being that given a strong preference for debt-financing and widespread use of land as collateral in Japan, land tax changes will cause fluctuations in land price that can potentially affect output and investment by affecting borrowing capacity of firms. Calibrating the model using Japanese data and feeding in observed TFP and land taxes one by one and in unison, I find that TFP and land tax fluctuations can significantly account for observed fluctuations in output, but cannot account for land price fluctuations unless agents expect land tax changes to be permanent. I further identify redistribution of land holding between commercial and residential uses in response to land tax and TFP changes as an important channel through which the effect of these external fluctuations on output gets amplified. Observed data of land use in Japan provides evidence of such redistribution. |
| Keywords: | Real estate, borrowing constraint, business cycle, japan |
| JEL: | E |
| Date: | 2005–04–06 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpma:0504012&r=ure |
| By: | SK Mishra (North Eastern Hill University, Shillong, Meghalaya, India); K Rio (North Eastern Hill University, Shillong, Meghalaya, India) |
| Abstract: | The enterprise of running private schools has of late assumed the nature of an industry in India. Ever-increasing population, a race for providing education to ones children, degenerating quality of education in govt.-run schools, unlimited supply of educated youths ready to work at the lowest salary, and the possibilities of earning huge profits for a modest investment together have contributed to the viability of this industry. In Kohima, the capital city of Nagaland (India), there are 31 private high/higher secondary schools against only 3 govt.-run schools. These private schools enroll some 25000 pupils. Enrolment in the govt.- run schools is barely 1600. These private schools employ 766 teachers and pay them an average salary, just 1/3rd of what the govt.-run schools pay. According to the ILO (1996) definition of subsistence wages the employees of these schools barely earn a subsistence wage. Nevertheless, these schools generate a revenue of Rs. 88 million of which Rs. 37 million is the net profit. Our analysis shows that private schooling industry in Kohima operates in a monopolistic competition market - bordering on oligopoly. There is price leadership in determining the fees to be charged by the schools making this industry. |
| Keywords: | Micro-economics of schools, private schooling industry, India, Kohima, Nagaland, oligopoly, subsistence level salaries |
| JEL: | P Q Z |
| Date: | 2005–04–14 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpot:0504006&r=ure |
| By: | Marcus Berliant (Washington University in St. Louis) |
| Abstract: | Review of the 'Handbook of Regional and Urban Economics: Volume 4: Cities and Geography' edited by J.V. Henderson and J.-F. Thisse |
| JEL: | R0 |
| Date: | 2005–03–03 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpur:0503001&r=ure |
| By: | Julie Le Gallo (IERSO IFReDE-GRES); Sandy Dall'erba (REAL) |
| Abstract: | This paper analyzes the evolution of labor productivity disparities among 145 European regions over 1975-2000 according to the concepts of ƒã- and ƒÒ-convergence and emphasizes the importance of including spatial effects and a disaggregated analysis at a sectoral level. We detect a significant -convergence only in aggregate labor productivity and in the services sectors among peripheral regions. We also show that omitting spatial effects leads to biased measures of -convergence. We then estimate a pooled -convergence model including spatial autocorrelation and sectoral differentiation. The results indicate that disparities in productivity levels between core and peripheral regions persist by vary by sector. |
| Keywords: | convergence, spatial econometrics, labor productivity, sectoral approach |
| JEL: | O52 R11 R15 |
| Date: | 2005–03–16 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpur:0503004&r=ure |
| By: | Bernard Fingleton (Cambridge University) |
| Abstract: | This paper evaluates 'new economic geography' theory by comparing it with a competing non-nested model derived from urban economics. Using bootstrap inference and the J-test, the paper shows that while NEG theory is supported by the data, it needs to be modified to achieve this, and it is not the only, or even the best or simplest, explanation of regional wage variations across the EU. |
| Keywords: | 'new economic geography', urban economics, bootstrap, J test |
| JEL: | R |
| Date: | 2005–04–11 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpur:0504003&r=ure |
| By: | Bo Zhao (Center for Policy Research, Maxwell School, Syracuse University); Jan Ondrich (Center for Policy Research, Maxwell School, Syracuse University); John Yinger (Center for Policy Research, Maxwell School, Syracuse University) |
| Abstract: | This paper studies racial and ethnic discrimination in discrete choices by real estate brokers using national audit data from the 2000 Housing Discrimination Study. It uses a fixed effects logit model to estimate the probability that discrimination occurs and to study the causes of discrimination. The data set makes it possible to control for auditors' actual demographic and socioeconomic characteristics, along with the characteristics assigned for the purposes of the audit. The study finds that discrimination continues to be strong but also documents a downward trend in both the scope and incidence of discrimination since 1989. The estimations also identify both brokers' prejudice and white customers' prejudice as causes of discrimination. |
| JEL: | J15 R31 |
| Date: | 2005–03 |
| URL: | http://d.repec.org/n?u=RePEc:max:cprwps:67&r=ure |
| By: | Belton M Fleisher (Department of Economics, Ohio State University); Haizheng Li (Georgia Tech); Shi Li (Chinese Academy of Social Sciences); Xiaojun Wang (Department of Economics, University of Hawaii at Manoa) |
| Abstract: | We estimate selection and sorting effects on the evolution of the private return to schooling for college graduates during China’s reform between 1988 and 2002. We find evidence of substantial sorting gains under the traditional system, but gains have diminished and even become negative in the most recent data. We take this as evidence consistent with the growing influence of private financial constraints on decisions to attend college as tuition costs have risen and the relative importance of government subsidies to higher education has declined. |
| Keywords: | return to schooling, sorting gains, heterogeneity, financial constraints, comparative advantage, China |
| JEL: | J31 J24 O15 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:hai:wpaper:200507&r=ure |
| By: | Ngee-Choon Chia (Department of Economics, National University of Singapore); Albert K C Tsui (Department of Economics, National University of Singapore) |
| Abstract: | The unique way of financing housing through the mandatory savings system in Singapore has created a class of “asset-rich and cash-poor” Singaporeans. This paper provides a framework to assess the viability of a reverse mortgage (RM) market so that such instruments may be harnessed as a source of financing retirement income for home owners. Based on different cost of capital, we estimate the probability of loss for both the private supplier and public provider of RMs. The probability of loss is computed by three major components: choice of replacement ratio and property growth rate; forecast of cohort survival probability by joint-life; and generation of yield curves to discount the future cash flows. The stochastic forecast of survival probability is estimated using the Lee-Carter demographic model based on the abridged life tables. The discount factor for future cash flows are generated from stochastic interest rates. Our simulation results indicate that based on the benchmark scenario, RM instruments by private providers are likely to achieve about 50% replacement ratio for the 4-room public housing owners. However, the market may be missing if a replacement ratio of 70% is required. |
| Keywords: | incomplete reverse mortgage market, replacement ratio, probability of loss, risk free interest, breakeven annuity |
| URL: | http://d.repec.org/n?u=RePEc:sca:scaewp:0503&r=ure |