|
on Urban and Real Estate Economics |
| By: | Kenneth K. Chow (Hong Kong Institute for Monetary Research); Matthew S. Yiu (Hong Kong Institute for Monetary Research); Charles Ka Yui Leung (City University of Hong Kong); Dickson C. Tam (China International Capital Corporation Limited) |
| Abstract: | The "overheating" of the Chinese housing market in recent years has caught the attention of policy makers, the research community, as well as the general public. Leung and Wang (2007) shows that the qualitative features of the aggregate Chinese housing market are well captured by the DiPasquale-Wheaton (1992) model. This paper estimates a version of the DiPasquale-Wheaton (1994) model with four major Chinese cities: Beijing, Tianjin, Shanghai and Chongqing. It examines the factors which affect the housing price and construction. Policy implications and future research directions are also discussed. |
| Keywords: | Housing Market Dynamics, Cross-city Difference, Panel Data Method |
| JEL: | C33 E30 R00 |
| Date: | 2008–11 |
| URL: | http://d.repec.org/n?u=RePEc:hkm:wpaper:212008&r=ure |
| By: | Ron Johnston; Michael Poulsen; James Forrest |
| Abstract: | Much has been written about ethnic residential segregation in urban areas, almost all of it deploying single-index numbers to measure the degree of segregation. These give very little detailed appreciation of the extent to which different ethnic groups live apart from each other, and where. This paper suggests that a combination of measures derived from local spatial statistics, which identify the geography of clustering, and a typology of residential areas, which describes the population composition of each area, provides much greater insight into the nature and extent of segregation. Data for London in 2001 illustrate the potential of this approach. |
| Keywords: | segregation, ethnicity, London, local statistics |
| JEL: | R1 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:bri:cmpowp:09/213&r=ure |
| By: | Lunde, Jens (Department of Finance, Copenhagen Business School) |
| Abstract: | Housing markets in several countries are suffering. The prolonged and strong housing price rises of recent years have turned around. Historical records suggest that housing price drops may happen slowly but be large. Housing prices continue to fall because capital losses have substituted capital gains, housing equities are falling, and housing price expectations have become negative. Household debt had increased to the same degree as housing prices or even more in some countries. Access to mortgage and credit had improved and lenders used "cruise control” when financing still higher housing market prices. Now, housing demand is further weakened because access to credit has been tightened. During a downturn, owner-occupiers’ housing price risk is increased and a growing number of owners have negative equity and payment troubles. Under these conditions, arrears and foreclosures will be widespread in owner-occupation. The effects on the wider economy of a housing price downturn are discussed. Not only does the lenders’ increased credit risk lead to tightened credit access, losses threaten the banks and can create financial crises. Falling housing prices clearly depress the housing market and housing construction activities and thereby the contribution of residential investments to economic growth, while it is less obvious that average housing consumption and residential investments over the whole cycle are affected. The reduction of non-housing consumption as a result of a wealth effect is a reality for years for depressed owner-occupiers but in the aggregate, the housing wealth effect is more dubious. |
| Keywords: | na |
| JEL: | G30 |
| Date: | 2008–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cbsfin:2008_001&r=ure |
| By: | Ron Johnston; Michael Poulsen; James Forrest |
| Abstract: | Much work on residential segregation in urban areas has focused on aspatial indices of urban residential segregation, largely ignoring locational aspects of the degree of spatial separation of different ethnic groups. The adoption of measures of global and local spatial autocorrelation has recently been suggested as a way of introducing a more explicit spatial approach to studying segregation. This paper uses two of those measures – Moran’s I and Getis and Ord’s G* – to explore segregation of the four main ethnic groups in Auckland, New Zealand’s largest and most multi-ethnic city, at the four most recent censuses held there. They are used to identify the clusters of census reporting units (meshblocks) where each group is significantly over- and under-represented, and to chart the degree of segregation within such clusters. |
| Keywords: | segregation, ethnicity, Auckland, local statistics |
| JEL: | R1 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:bri:cmpowp:09/214&r=ure |
| By: | Artis, Michael J; Miguélez, Ernest; Moreno, Rosina |
| Abstract: | This paper is concerned with the influence of agglomeration economies on economic outcomes across British regions. The concentration of economic activity in one place can foster economic performance due to the reduction in transportation costs, the ready availability of customers and suppliers, and knowledge spillovers. However, the concentration of several types of intangible assets can boost productivity as well. Thus, using an interesting dataset which proxies regional productivity, we will assess the relative importance of agglomeration and other assets, controlling both for endogeneity and for spatial autocorrelation at the same time. Our results suggest that agglomeration has a definite positive influence on productivity, although our estimates of its effect are dramatically reduced when spatial dependence and other hitherto omitted variables proxying intangible assets are controlled for. |
| Keywords: | agglomeration economies; endogeneity; intangible assets; spatial autocorrelation |
| JEL: | C21 R10 R11 R12 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7267&r=ure |
| By: | India Social Forum ISF |
| Abstract: | A consultation with about 40 children who have faced violations of their housing rights in some form or the other was organized on 13th November 2006 from 9 – 12 am on the National platform of India Social Forum in New Delhi. These were the children who have faced forced evictions; development induced displacement, children living in inadequate housing conditions as well as homeless/street children. For this consultation, YUVA with its experience in the field of housing rights decided to get all the partners who have been a part of the struggle for housing rights of the poor and displaced. This is a report of the consultation and the rich and heartfelt exchanges. |
| Keywords: | housijng, displacement, children, right ot housing, right to livelihood, development, destructions, cities, urban areas, youth, Urban Studies |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:1887&r=ure |
| By: | Francesco Drudi (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Petra Köhler-Ulbrich (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Marco Protopapa (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Jiri Slacalek (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Christoffer Kok Sørensen (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Guido Wolswijk (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Ramón Gómez Salvador (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Ruth Magono (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Nico Valckx (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Elmar Stöss (Deutsche Bundesbank,Taunusanlage 5, D-60329 Frankfurt am Main, Germany.); Karin Wagner (Oesterreichische Nationalbank, Otto Wagner Platz 3, A-1011 Vienna, Austria.); Zoltan Walko (Oesterreichische Nationalbank, Otto Wagner Platz 3, A-1011 Vienna, Austria.); Marie Denise Zachary (Banque Nationale de Belgique, Boulevard de Berlaimont 14, B-1000 Brussels, Belgium.); Silvia Magri (Banca d'Italia, Via Nazionale 91, I - 00184 Rome, Italy.); Laura Bartiloro (Banca d'Italia, Via Nazionale 91, I - 00184 Rome, Italy.); Paolo Mistrulli (Banca d'Italia, Via Nazionale 91, I - 00184 Rome, Italy.); Yannis Asimakopoulos (Bank of Greece, 21, E. Venizelos Avenue, P. O. Box 3105, GR-10250 Athens, Greece.); Vasilis Georgakopoulos (Bank of Greece, 21, E. Venizelos Avenue, P. O. Box 3105, GR-10250 Athens, Greece.); Maria Kasselaki (Bank of Greece, 21, E. Venizelos Avenue, P. O. Box 3105, GR-10250 Athens, Greece.); Jorge Martínez Pagés (Banco de España, Alcalá 50, E-28014 Madrid, Spain.); Romain Weber (Banque centrale du Luxembourg, 2 boulevard Royal, L - 2983 Luxembourg, Luxembourg.); Christiana Argyridou (Central Bank of Cyprus, 80, Kennedy Avenue, CY-1076 Lekosia, Cyprus.); Wendy Zammit (Bank of Malta, Castille Place, Valetta, CMR 01, Malta.); Nuno Ribeiro (Banco de Portugal, 148, Rua do Comercio, P-1101 Lisbon, Codex, Portugal.); Daniel Gabrielli (Banque de France, 39, rue Croix-des-Petits-Champs, F-75049 Paris Cedex 01, France.); Nicola Doyle (Central Bank of Ireland, Dame Street, IE Dublin 2, Ireland.); Harri Hasko (Suomen Pankki, P. O. Box 160, FIN-00101 Helsinki, FI.); Vesna Lukovic (Banka Slovenije, Slovenska 35, SL-1505 Ljubljana, SL.) |
| Abstract: | This report analyses the main developments in housing finance in the euro area in the decade, covering the period from 1999 to 2007. It looks at mortgage indebtedness, various characteristics of loans for house purchase, the funding of such loans and the spreads between the interest rates on loans granted by banks and the interest rates banks had to pay on their funding, or the return they made on alternative investments. In addition, the report contains a comparison of key aspects of housing finance in the euro area with those in the United Kingdom and the United States. At the end, the report briefly discusses aspects of the transmission of monetary policy to the economy. JEL Classification: D14, E44, E5, G21, R21. |
| Keywords: | bank competition, bank funding, bankruptcy, banks, cost of funding (of banks), cost of housing loans, debt service, ECB monetary policy, foreclosure, household debt, household survey, housing finance, insolvency, loan maturity, loan-to-value ratio, monetary policy transmission, mortgage, mortgage covered bond, mortgage equity withdrawal, mortgage interest rate spread, redemption scheme, rental market, retail deposits, securitisation, taxation, US housing market crisis. |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbops:20090101&r=ure |
| By: | O. Ashton Morgan; Stuart E. Hamilton |
| Abstract: | In small coastal communities with uniform flood risk, amenity value is comprised of two components – view and access. Having controlled for view, it is assumed that any residual amenity value represents the benefit derived from households from accessing the beach for leisure or recreational purposes. However, as properties closer to the beach typically have improved viewsheds, the two amenities are highly correlated, and disentangling view and access is problematical. We posit that for many coastal communities, access is restricted to designated public access points, precluding local residents from accessing the beach area directly from their property. To appropriately account for restricted access, we incorporate a network distance access measure into a spatial autoregressive hedonic model to capture ease of beach access for local residents. Our findings suggest that, as network distance varies independently from property viewshed, collinearity effects are mitigated, and access and view can be disentangled. Key Words: |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:apl:wpaper:09-10&r=ure |
| By: | Rudiger von Armin (New School for Social Research, New York, NY) |
| Keywords: | housing crisis; credit crisis |
| Date: | 2008–12 |
| URL: | http://d.repec.org/n?u=RePEc:epa:cepawp:2008-4&r=ure |
| By: | C. Kirabo Jackson |
| Abstract: | In Trinidad and Tobago students are assigned to secondary schools after fifth grade based on achievement tests, leading to large differences in the school environments to which students of differing initial levels of achievement are exposed. Using both a regression discontinuity design and rule-based instrumental variables to address self-selection bias, I find that being assigned to a school with higher-achieving peers has large positive effects on examination performance. These effects are about twice as large for girls than for boys. This suggests that ability-grouping reinforces achievement differences by assigning the weakest students to schools that provide the least value-added. |
| JEL: | I20 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14911&r=ure |
| By: | Helen Slater; Simon Burgess; Neil Davies |
| Abstract: | Using a unique primary dataset for the UK, we estimate the effect of individual teachers on student outcomes, and the variability in teacher quality. This links over 7000 pupils to the individual teachers who taught them, in each of their compulsory subjects in the high-stakes exams at age 16. We use point-in-time fixed effects and prior attainment to control for pupil heterogeneity. We find considerable variability in teacher effectiveness, a little higher than the estimates found in the few US studies. We also corroborate recent findings that observed teachers’ characteristics explain very little of the differences in estimated effectiveness. |
| Keywords: | education, test scores, teacher effectiveness |
| JEL: | I20 |
| Date: | 2009–01 |
| URL: | http://d.repec.org/n?u=RePEc:bri:cmpowp:09/212&r=ure |
| By: | Voigtländer, Nico; Voth, Hans-Joachim |
| Abstract: | How did Europe overtake China? We construct a simple Malthusian model with two sectors, and use it to explain how European per capita incomes and urbanization rates surged ahead of Chinese ones. Productivity growth can only explain a small fraction of rising living standards. Population dynamics - changes of the birth and death schedules - were far more important drivers of the long-run Malthusian equilibrium. The Black Death raised wages substantially, creating important knock-on effects. Because of Engel’s Law, demand for urban products increased, raising urban wages and attracting migrants from rural areas. European cities were unhealthy, especially compared to Far Eastern ones. Urbanization pushed up aggregate death rates. This effect was reinforced by more frequent wars (fed by city wealth) and disease spread by trade. Thus, higher wages themselves reduced population pressure. We show in a calibration exercise that our model can account for the sharp rise in European urbanization as well as permanently higher per capita incomes in 1700, without technological change. Wars contributed importantly to the rise of Europe, even if they had negative short-run effects. We also examine intra-European growth, using a panel of European states in the period 1300-1700. Estimation results suggest that war frequency can explain a good share of divergent fortunes within Europe as well. |
| Keywords: | Demographic Regime; Epidemics; Great Divergence; Long-run Growth; Malthus to Solow |
| JEL: | E27 N13 N33 O14 O41 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7275&r=ure |
| By: | Vivien Procher |
| Abstract: | This paper analyzes the location choice determinants of French first-time investments in Europe, North America and North Africa. Firm locations are examined on two geographical scales, the national and regional level. The final sample comprises 307 location decisions in 27 countries and across 45 regions. Both, location- and firm-specific variables are used for analysing the investment strategy of French firms. The results show that higher market demand and cultural proximity to France increase the likelihood of a particular location to be chosen, whereas higher labour cost and a larger distance between a foreign location and the headquarters deter FDI investments. Manufacturing and older companies are more likely to establish their first subsidiary in Eastern Europe. Furthermore, this study examines the extent to which French investors choose foreign locations that already host a significant number of French firms.The results obtained from regressions with various absolute and relative agglomeration measures suggest that French investors are rather attracted by firm cluster in general, or by the unobserved factors that led to the agglomeration in the first place, than by any nation-specific firm cluster. |
| Keywords: | Foreign direct investment, location choices, agglomeration, smalland medium-sized enterprises |
| JEL: | F21 F23 D21 R30 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0100&r=ure |
| By: | Karen, CRABBE; Hylke, VANDENBUSSCHE (UNIVERSITE CATHOLIQUE DE LOUVAIN, Department of Economics) |
| Abstract: | Tax competition within the EU is fiercer than in the rest of the OECD with tax rates falling rapidly. This paper analyzes tax responses of EU-15 countries to corporate tax changes in the EU-10 new member states as a function of their proximity to these new member states. The average corporate tax rate in the new member states has always been considerably lower than the average in the EU-15 countries. Their entry into the EU eliminated capital barriers, allowing firms to locate in one of the new EU-10 with full access to the European Market. Our results indicate that EU-15 countries geographically closer to the new member states respond stronger to corporate tax changes in these new member states. We use a theoretical and a spatial regression framework to test the hypothesis that distance to a low tax region intensifies countriesÕ tax reaction functions |
| Keywords: | H25; H77; H39 |
| Date: | 2008–12–05 |
| URL: | http://d.repec.org/n?u=RePEc:ctl:louvec:2008050&r=ure |
| By: | Muriel Fadairo (CREUSET - Centre de Recherche Economique de l'Université de Saint-Etienne - CNRS : FRE2938 - Université Jean Monnet - Saint-Etienne); Nadine Massard (CREUSET - Centre de Recherche Economique de l'Université de Saint-Etienne - CNRS : FRE2938 - Université Jean Monnet - Saint-Etienne) |
| Abstract: | The "Geography of Innovation" is based on the desire to give empirical foundations to the explanations behind the pronounced spatial polarisation of the innovation activities. It focuses on an attempt to measure the spatial dimension of knowledge externalities, in order to reveal their role in the organisation of research systems. The aim of this paper is to survey this empirical literature in order to highlight the main results interesting for the innovation policy. This analysis emphasises one main role of technology policy : supporting the institutions which generate knowledge and learning. These are found at various territorial levels, especially within the European Union. Here attention is drawn to the regional intervention level. |
| Keywords: | technology policy, geography of innovation, knowledge externalities, European regions, knowledge-based economy |
| Date: | 2009–04–20 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-00377007_v1&r=ure |
| By: | Monika Piazzesi; Martin Schneider |
| Abstract: | In the 1970s, U.S. asset markets witnessed (i) a 25% dip in the ratio of aggregate household wealth relative to GDP and (ii) negative comovement of house and stock prices that drove a 20% portfolio shift out of equity into real estate. This study uses an overlapping generations model with uninsurable nominal risk to quantify the role of structural change in these events. We attribute the dip in wealth to the entry of baby boomers into asset markets, and to the erosion of bond portfolios by surprise inflation, both of which lowered the overall propensity to save. We also show that the Great Inflation led to a portfolio shift by making housing more attractive than equity. Apart from tax effects, a new channel is that disagreement about inflation across age groups drives up collateral prices when credit is nominal. ; This paper is an extension of Monika Piazzesi's and Martin Schneider's work while they were in the Research Department of the Federal Reserve Bank of Minneapolis. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmsr:423&r=ure |
| By: | Tara Watson |
| Abstract: | American metropolitan areas have experienced rising residential segregation by income since 1970. One potential explanation for this change is growing income inequality. However, measures of residential sorting are typically mechanically related to the income distribution, making it difficult to identify the impact of inequality on residential choice. This paper presents a measure of residential segregation by income, the Centile Gap Index (CGI) which is based on income percentiles. Using the CGI, I find that a one standard deviation increase in income inequality raises residential segregation by income by 0.4-0.9 standard deviations. Inequality at the top of the distribution is associated with more segregation of the rich, while inequality at the bottom and declines in labor demand for less-skilled men are associated with residential isolation of the poor. Inequality can fully explain the rise in income segregation between 1970 and 2000. |
| JEL: | R21 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14908&r=ure |
| By: | Kata Mihaly |
| Abstract: | Peer interactions have been argued to play a major role in student academic achievement. Recent work has focused on measuring the structure of peer interactions with the location of the student in their social network and has found a positive relationship between student popularity and academic achievement. Here the author ascertains the robustness of previous findings to controls for endogenous friendship formation. The results indicate that popularity influences academic achievement positively in the baseline model, a finding which is consistent with the literature. However, controlling for endogenous friendship formation results in a large drop in the effect of popularity, with a significantly negative coefficient in all of the specifications. These results point to a negative short term effect of social capital accumulation, lending support to the theory that social interactions crowd out activities that improve academic performance. |
| JEL: | I21 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:678&r=ure |
| By: | Muellbauer, John; Murata, Keiko |
| Abstract: | This paper documents the role of consumption in explaining the weak interest rate effect of monetary transmission in Japan. Economic theory suggests circumstances in which a rise in short term real interest rates can increase consumption, contrary to much conventional wisdom. This paper suggests that these circumstances are more likely to be prevalent in Japan and finds strong empirical evidence for a positive effect. Life-cycle theory also suggests that housing wealth effects on aggregate consumption including imputed rent are small and negative. Positive effects of the kind found in the UK and the US are due to the role of the credit channel. In countries where consumer access to credit is restricted, these restrictions can enhance the negative effect on consumption of higher house prices because saving for a housing deposit needs to be higher. Our evidence of a negative land price effect for Japan supports this hypothesis. We find no evidence of significant household credit market liberalization from a model for household debt in Japan. We also find evidence for a sizable negative effect on consumption from higher government deficits, suggesting fiscal policy also had limitations. These findings contribute to explanations of Japan's 'lost decade'. |
| Keywords: | interest rate effect on consumption; Japan's lost decade; Land prices and consumption; monetary transmission in Japan |
| JEL: | E21 E32 E44 E51 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7269&r=ure |
| By: | Rebecca Allen; Simon Burgess; Frank Windmeijer |
| Abstract: | The most widely used measure of segregation is the dissimilarity index, D. It is now well understood that this measure also reflects randomness in the allocation of individuals to units; that is, it measures deviations from evenness not deviations from randomness. This leads to potentially large values of the segregation index when unit sizes and/or minority proportions are small, even if there is no underlying systematic segregation. Our response to this is to produce an adjustment to the index, based on an underlying statistical model. We specify the assignment problem in a very general way, with differences in conditional assignment probabilities underlying the resulting segregation. From this we derive a likelihood ratio test for the presence of any systematic segregation and a bootstrap bias adjustment to the dissimilarity index. We further develop the asymptotic distribution theory for testing hypotheses concerning the magnitude of the segregation index and show that use of bootstrap methods can improve the size and power properties of test procedures considerably. We illustrate these methods by comparing dissimilarity indices across school districts in England to measure social segregation. |
| Keywords: | segregation, dissimilarity index, bootstrap methods, hypothesis testing |
| JEL: | C12 C13 C15 C46 I21 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:bri:cmpowp:09/216&r=ure |
| By: | Giuseppe C.Ruggeri (University of New Brunswick) |
| Abstract: | This paper discusses the methodology for the calculation of federal fiscal flows in a federation and the measurement of interregional redistribution. It identifies five major steps: (a) the selection of the approach for calculating federal fiscal flows, (b)the allocation of federal revenues and expenditures among regions, (c) the choice of the appropriate concept of regional economic disparities, (d) the selection of the relevant indicators of interregional redistribution, and (e) the estimation of these indicators. It concludes with some suggestions for further research, stressing the need to develop a common methodology and to place the study of interregional redistribution in a dynamic context. |
| Keywords: | Methodology, interregional redistribution, fiscal federalism. |
| JEL: | B41 H77 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ieb:wpaper:2009/4/doc2009-4&r=ure |
| By: | Jonathan C. Rork (Andrew Young School of Policy Studies - Georgia State University); Gary A. Wagner (University of Arkansas at Little Rock) |
| Abstract: | One challenge states face in designing an income tax system is deciding how to treat non-resident earners. Numerous states have entered into reciprocity agreements with other states that exclude non-residents’ income from the tax base. These agreements provide a unique opportunity to explore the nature of state tax competition. We demonstrate that not only do reciprocity agreements dampen competition over income taxes, but the states that enact agreements also exhibit decreased levels of competition over other tax bases. This suggests that reciprocity agreements are a credible vehicle for states to act cooperatively and avoid a potential race to the bottom. |
| Keywords: | Spatial econometrics, interjurisdictional competition, state taxation, reciprocity. |
| JEL: | H7 R5 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ieb:wpaper:2009/4/doc2009-1&r=ure |
| By: | Rigoberto A. López (Department of Agricultural and Resource Economics, University of Conneticut.); Elena López (Departamento de Fundamentos de Economía e H.E. , Universidad de Alcalá.); Carmen Liron-Espana (System Planning, ISO-NE.) |
| Abstract: | This article estimates the impact of industrial concentration on market power and cost and then links the ensuing welfare changes to market structure characteristics using a sample of 232 U.S. manufacturing industries. Empirical results indicate that further increases in concentration would enhance welfare in 70% of the industries due to widespread efficiency gains, although these would generally not be passed on to consumers. From a social standpoint, further concentration is more likely to be beneficial in industries with economies of size, high export intensity, which are engaged in consumer-oriented goods, face larger markets, and have low or moderate levels of initial concentration. |
| Keywords: | Concentration, Welfare, Economies of size, Market power, Manufacturing. |
| JEL: | L11 L60 D43 D61 F12 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:alc:alcamo:0901&r=ure |
| By: | Daniel Rosch (Leibniz University of Hannover); Harald Scheule (University of Melbourne) |
| Abstract: | Recent studies find a positive correlation between default and loss given default rates of credit portfolios. In response, financial regulators require financial institutions to base their capital on the 'Downturn' loss rate given default which is also known as Downturn LGD. This article proposes a concept for the Downturn LGD which incorporates econometric properties of credit risk as well as the information content of default and loss given default models. The concept is compared to an alternative proposal by the Department of the Treasury, the Federal Reserve System and the Federal Insurance Corporation. An empirical analysis is provided for Hong Kong mortgage loan portfolios. |
| Keywords: | Basel II, Business Cycle, Capital Adequacy, Correlation, Credit Risk, Economic Downturn, Expected Loss, Fixed Income, Loss Given Default, Probability of Default, Value-at-Risk |
| JEL: | G20 G28 C51 |
| Date: | 2008–08 |
| URL: | http://d.repec.org/n?u=RePEc:hkm:wpaper:152008&r=ure |
| By: | Jin, Zhong; Michael, Lipsman |
| Abstract: | Executive Summary: Iowa introduced the Historic Preservation and Cultural and Entertainment District (HPCED) Tax Credit Program in 2000. The program allows property owners or developers to claim tax credits equal to 25 percent of qualified rehabilitation costs for eligible historic properties in Iowa. In tax year 2002, the tax credit was made transferable and refundable at a discounted amount. In tax year 2005, the cap of the tax credit was increased to $6.5 million per year. In tax year 2007, the cap of the tax credit was increased to $10 million for fiscal year 2008, $15 million for fiscal year 2009, and $20 million for fiscal year 2010 and subsequent years. In addition, the tax credit was made fully refundable in 2007. The major findings of the study are:... |
| Keywords: | Investment Tax Credit; Tax Policy; State and Local Governement; Public Subsidy |
| JEL: | D62 H0 H43 H71 R33 |
| Date: | 2009–03–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:14794&r=ure |
| By: | Freeman, Alan |
| Abstract: | This paper describes the Greater London Authority’s evidence base for its work on the creative and cultural industries. Its main purpose is to show that th9is evidence base is viable, robust, and useful. The second and most important purpose is to encourage others in city management to invest in such evidence bases, and to compile them on a comparable basis. It will be some while before this is done by international agencies, and that national agencies are only at the start of a long journey in recognising the importance of city data. Hence, I argue in this paper, a responsibility devolves onto the cities themselves. This paper is about those responsibilities. The paper was originally presented to the Conference Board of Canada at its March 2008 international conference on the creative industries, and, along with the conference proceedings, can be obtained from the conference board via www.e-library.ca. or www.conferenceboard.ca |
| Keywords: | cultural economics; creative industries; innovation; internet |
| JEL: | Z1 Z11 |
| Date: | 2008–03–26 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:14776&r=ure |
| By: | Ettore Dorrucci (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Alexis Meyer-Cirkel (Goethe-Universität Frankfurt am Main, Senckenberganlage 31, D-60325 Frankfurt am Main, Germany.); Daniel Santabárbara (Banco de Espana, Alcala 50, E-28014 Madrid, Spain.) |
| Abstract: | We construct, on the basis of an original methodology and database, composite indices to measure domestic financial development in 26 emerging economies, using mature economies as a benchmark. Twenty-two variables are used and grouped according to three broad dimensions: (i) institutions and regulations; (ii) size of and access to financial markets and (iii) market performance. This new evidence aims to fill a gap in the economic literature, which has not thus far developed comparable time series including both emerging and mature economies. In doing so, we provide a quantitative measure of the – usually considerable – scope for the selected emerging countries and regions to “catch up” in financial terms. Moreover, we find evidence that a process of financial convergence towards mature economies has already started in certain emerging economies. Finally, we conduct an econometric analysis showing that different levels of domestic financial development tend to be associated with the building up of external imbalances across countries. JEL Classification: F3, F4, G1, G2, E21, E22, C82. |
| Keywords: | Financial development, index construction, commodity and oil-exporting countries, G20, major emerging economies, financial catching up, global imbalances. |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbops:20090102&r=ure |
| By: | Stéphane Lhuillery (Chaire en Economie et Management de l'Innovation, Collège du Management de la Technologie, Ecole Polytechnique Fédérale de Lausanne) |
| Abstract: | Standard innovation surveys do not consider incoming spillovers for non-innovative firms. The Swiss innovation surveys presented here measure the importance of competitors' knowledge for both innovating and noninnovating firms. This original feature not only enables us to accurately identify the role of incoming knowledge on R&D decisions and innovation output, but also to compare resulting data with those which standard innovation questionnaires provide. Using a panel data over four periods, we show that knowledge from rivals actually deters manufacturing firms from engaging in R&D activities. Moreover, we provide stronger evidence that intra-industry spillovers are more detrimental to innovation than that generally provided by data from standard surveys. The results suggest that the dominance of the absorptive capacity effect is more important to firms investing in R&D and that non-innovative firms rely more heavily than expected on their competitors to maintain their technological capacities. |
| Keywords: | intra-industry spillovers, absorption, innovation survey |
| JEL: | O31 C35 C81 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:cmi:wpaper:cemi-workingpaper-2009-005&r=ure |
| By: | Shirai, Sayuri |
| Abstract: | The world economy currently suffers from a global financial and economic crisis that has become severe since the second half of 2008. This global financial situation was triggered by the advent of the subprime mortgage crisis in the United States that became apparent from the mid-2007s. Europe was the next affected, thereafter its contagion spread to the rest of the world. East Asia did not escape. The nature of the current global financial crisis is unprecedented in terms of (1) the scale of the problems in the financial sector (particularly in the United States and Europe), (2) the depth and speed of contagion worldwide (through financial sector and trade linkages), and (3) the severity of the recession (particularly in emerging market economics, small countries, and East Asia). This paper analyzes, mainly, cross-border capital movements by looking at the pre-crisis features of the United States as the crisis hypocenter and its relationships with other countries. Detailed observations are conducted with respect to cross-border investment in stocks and debt securities, as well as banking activities. The paper then sheds light on the impact of the subprime mortgage crisis on cross-border capital movements in the United States, the United Kingdom, and East Asia. Other performance indicators such as exchange rates, economic growth and international trade are also discussed in the case of East Asia. The paper examines several challenges the recent crisis poses for East Asia. |
| Keywords: | Subprime Mortgage; Global Economic Crisis; East Asia; Cross-border capital flows |
| JEL: | F3 G15 |
| Date: | 2009–04–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:14722&r=ure |
| By: | Knies G (Institute for Social and Economic Research) |
| Abstract: | This research examines the strength of peopleÂ’s ties with close neighbours and the sensitivity thereof to changes in residential mobility, access to modes of public and private transport, and changes in the availability of modern communications technologies using the German Socio-economic Panel Study (SOEP). All forms of mobility have increased over time and are negatively associated with visiting neighbours. With further increases in mobility, close neighbours may become less relevant. Nevertheless, presently the incidence of visits with neighbours is sizeable; in contrast to the frequent assertion in the literature that the neighbourhood is of no importance. |
| Date: | 2009–04–17 |
| URL: | http://d.repec.org/n?u=RePEc:ese:iserwp:2009-15&r=ure |
| By: | Anupam Nanda (Mumbai); Katherine A. Pancak (University of Connecticut) |
| Abstract: | Since 2004, ten U.S. states have enacted laws that mandate real estate brokers to provide real estate consumers with a minimum level of services. The federal government and the academic literature suggest that such state laws are a result of anti-competitive industry collusion, and serve no consumer protection justification. This paper attempts to determine the factors that led states to adopt minimum service requirements, despite significant federal opposition. The analytical structure employs hazard models, using a unique set of economic and institutional attributes for 50 U.S. states from 2000 to 2007. Contrary to initial expectations based on the literature, our results indicate that both strength of a state.s Realtor association and broker membership on real estate licensing boards decrease, rather than increase, the likelihood of state adoption of broker minimum service requirements. Factors that do increase the likelihood of adoption include higher state licensing complaints and a democratically controlled state legislature. |
| Keywords: | Minimum Services, Hazard Model |
| JEL: | C14 K11 L85 R21 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:uct:alumni:2009-01&r=ure |
| By: | Giorgio Calcagnini (Dipartimento di Economia e Metodi Quantitativi, Università di Urbino (Italy)); Germana Giombini (Dipartimento di Economia e Metodi Quantitativi, Università di Urbino (Italy)) |
| Abstract: | This paper aims at analysing whether banking changes that occurred in Italy in the last fifteen years have mined the soundness of its financial system. We look for potential threats to financial stability as a result of the dynamic behaviour of Italian banks that progressively have been favouring consumer households at the expense of firms in the allocation of credit. The theme of financial instability is closely linked to the question of capital regulation, which is a centrepiece of government intervention because it affects banks’ soundness and risk taking incentives. After reviewing the literature on capital regulation, we first discuss the role of guarantees as a solution to banks’ potential instability in the case of credit default and, secondly, we estimate a bank interest rate model that explicitly includes collateral and personal guarantees as explanatory variables. We show that banks follow different lending policies according to the type of customer. In the case of firms banks seem to efficiently screen and monitor customers and guarantees (real and personal) are both used to reduce moral hazard problems. In the case of consumer households and sole proprietorships banks behave “lazily” by replacing screening and monitoring activities with personal guarantees; instead, collateral is used to separate good from bad customers (i.e., to mitigate adverse selection problems). These results, together with the large proportion of bad loans in case of unsecured loans, may indicate the existence of potential sources of financial instability because (a) personal guarantees are a small share of loans, especially in the case of consumer households, (b) a decline in the value of collateral held by banks in the event of a housing market weakening. |
| Keywords: | Banking Crisis; Household and Firm Credit Growth; Banking Regulation. |
| JEL: | E44 G21 G28 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:urb:wpaper:09_03&r=ure |
| By: | Elisabetta Iossa; David Martimort |
| Abstract: | Building upon Iossa and Martimort (2008), we study the main incentive issues and the form of optimal contracts for Public Private Partnerships (PPPs) in transports. We present a basic model of procurement in a multitask environment in which a risk-averse firm chooses unobservable efforts in infrastructure and service quality. We begin by analyzing the effect on incentives and risk transfer of bundling building and operation into a single contract. We consider the factors that affect the optimal allocation of demand risk and their implications for the choice of contract length. We discuss the dynamics of PPP contracts and how the risk of regulatory opportunism affects contract design and incentives. |
| Keywords: | Contracting out, public-private partnerships, public-service provision, transport |
| JEL: | D8 H54 H57 L5 L91 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:bri:cmpowp:09/210&r=ure |