|
on Urban and Real Estate Economics |
| By: | Hui Shan |
| Abstract: | Reverse mortgages allow elderly homeowners to tap into their housing wealth without having to sell or move out of their homes. However, very few eligible homeowners have used reverse mortgages to achieve consumption smoothing until recently when the reverse mortgage market in the United States witnessed substantial growth. This paper examines 1989-2007 loan-level reverse mortgage data and presents a number of findings. First, I show that recent reverse mortgage borrowers are significantly different from earlier borrowers in many respects. Second, I find that borrowers who take the line-of-credit payment plan, single male borrowers, and borrowers with higher house values exit their homes sooner than other reverse mortgage borrowers. Third, I combine the reverse mortgage data with county-level house price data to show that elderly homeowners are more likely to purchase reverse mortgages when the local housing market is at its peak. This finding suggests that the 2000-05 housing market boom may be partially responsible for the rapid growth of reverse mortgage markets. Lastly, I show that the Federal Housing Administration (FHA) mortgage limits, which cap the amount of housing wealth that an eligible homeowner can borrow against, have no effect on the demand for reverse mortgages. The findings have important implications to both policy-making and the economics of housing and aging. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2009-42&r=ure |
| By: | Yuemei JI |
| Abstract: | This paper proposes a behavioral model to study how schools influence students’ educational behavior and academic achievements. The school quality is then defined into two dimensions: the amount of market-valued skills schools impart and how well schools cultivate an educational identity. Using data from Add Health in the US, I test the major hypotheses from the theoretical model. On the one hand, school resources (average class size and teacher supply) and student-level curriculum have some effects on the math GPA scores. On the other hand, educational identity indicators (school-level happiness and participation at school teams, clubs or organizations) and the previous math GPA scores are significant determinants in students’ observable effort level such as absenteeism behavior, and through this channel both determinants indirectly influence math GPA achievement. These empirical results inform us that an identity-based behavioral model adds to a rational expectation educational choice model in understanding the widening academic achievement gap between adolescents from different socioeconomic backgrounds. The paper presents the limitation of using school resources to study the school quality and advocates a richer set of school quality measures. |
| Keywords: | identity, educational choice, school |
| JEL: | D81 I20 I30 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:ete:ceswps:ces09.17&r=ure |
| By: | Sarena Goodman (Columbia University - Department of Economics); Lesley Turner (Columbia University - Department of Economics) |
| Abstract: | In current debates regarding the future of education, teacher compensation schemes are often criticized for their lack of performance-based pay. Proponents of merit pay for teachers argue that tying teacher salaries to student achievement will induce teachers to focus on the success of their students and stimulate innovation in the school system as a whole. In this paper, we use a randomized policy experiment conducted in the New York City public school system to explore the effects of one group-based pay scheme. We investigate potential impacts of incentive pay over two academic years (2007-2008 and 2008-2009) on student performance on annual math and reading exams, teacher absences, and responses to environmental surveys of teachers and students. We also consider whether the program had differential outcomes on groups within schools that were especially likely to be targeted, given the particular incentive structure of the program. Last, we explore relative impacts on the market for teachers by examining end-of-year teacher turnover and the quality composition of newly hired teachers. In general, we find no significant effects of this program. However, there is some evidence that the program reduced teacher absenteeism in schools with a small number of teachers, and that these effects were weakened in larger schools by the presence of free-riding. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:clu:wpaper:0910-05&r=ure |
| By: | Davide Dottori (Bank of Italy); I-Ling Shen (Université catholique de Louvain) |
| Abstract: | A political-economic model is provided to study the impact of low-skilled immigration on the receiving country's education system, in terms of sources of school funding, expenditure per pupil, and type of parents who are more likely to send children to privately funded schools. The education regime results from the interplay between households' choices on fertility and education and the public education provided. No exogenous culturally-based difference is assumed among agents. Low-skilled migrant workers differ from their local counterparts only in voting rights and adjustment costs. The impact of immigration on public school congestion, tax base, wages and skill premium are considered. When the number of low-skilled immigrants is large, the education regime tends to become more segregated, with wealthier locals more likely to opt out of the public system into private schools. The fertility differential between high- and low-skilled locals increases due to a quantity/quality trade-off. The theoretical predictions conform to stylized facts revealed in US census data and OECD PISA (2003). |
| Keywords: | double taxation, education funding, fertility, migration, segregation, voting |
| JEL: | H42 H52 I21 D72 O15 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wptemi:td_726_09&r=ure |
| By: | Bertacchini Enrico; Borrione Paola |
| Abstract: | Through census employment data we analyze the evolving structure of the Italian cultural economy and highlights diverging spatial and organizational patterns of cultural production systems in urban and regional areas. Whilst large metropolitan areas remain the more important loci of cultural content production and consumption, craft-based sectors and creative systems of design have a tendency to locate in non-metropolitan centers. Based on the historical formation of manufacturing districts and on the emergence of Rome and Milan as “world cities”, the Italian cultural economy provides an interesting case study to analyze the geographical patterns of different cultural product industries. We extend previous literature on the geography of the cultural economy by offering new insights as to conditions in which metropolitan and rural areas emerge as leading centers of cultural production and creativity. |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:uto:eblawp:200902&r=ure |
| By: | Addison-Smyth, Diarmaid (Central Bank and Financial Services Authority of Ireland); McQuinn, Kieran (Central Bank and Financial Services Authority of Ireland); O' Reilly, Gerard (Central Bank and Financial Services Authority of Ireland) |
| Abstract: | The sharp decline in the performance of international property markets has been central to the financial distress experienced globally. The Irish housing market experienced particularly strong rates of price increases and heightened activity levels by OECD standards. One reason cited for such large price increases has been the significant degree of financial liberalisation experienced by Irish credit institutions. The culmination ofmuch of this liberalisation resulted in large increases in the availability of mortgage credit. In this paper we apply a recently developed model of mortgage credit and examine the implications for Irish house prices of changes in lending patterns. Our results suggest that post 2003, a significant amount of the increase in Irish prices was determined by innovative developments in international finance, which enabled Irish institutions, in particular, to secure alternative sources of lending funds. |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:cbi:wpaper:9/rt/09&r=ure |
| By: | Basudha Chattopadhyay |
| Abstract: | This paper aims at discussing some of the important issues relating to sustainable urban form that would lead to sustainable urban development with possible references to India. The paper is based on available literature and secondary data. The study discusses the compact city debate and next it explains the concept and possibilities of multi-modal urban region as a city form. [Discussion Paper No.5] |
| Keywords: | sustainable, urban, development, India, secondary data, city, region, population, social infrastructure, transportation, employment, shelter, basic services, Millennium Development Goals, climate change, environmental, social, equity |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2289&r=ure |
| By: | Adrian Healy; Kevin Morgan |
| Abstract: | Contrary to the fashionable “death of distance” thesis, the socio-spatial context for innovation remains as important as ever for firms, networks and the public institutions that tend to be neglected in orthodox narratives of learning. In this article we explore the changing socio-spatial dynamics of innovation through the medium of three arguments: (i) that the “learning region” debate was worth having because it triggered a fruitful dialogue between innovation theorists and economic geographers; (ii) that geographical proximity remains central to our understanding of learning and innovation and should not be reduced to, or conflated with, physical co-location; and (iii) that “the ecological turn” challenges conventional conceptions of learning, innovation and development, posing unsettling questions about the forces of path dependency, especially in less favoured regions. |
| Keywords: | Learning, regions, innovation, proximities |
| JEL: | O31 O38 R11 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:0918&r=ure |
| By: | Urdal, Henrik; Hoelscher, Kristian |
| Abstract: | By 2050, two-thirds of the world’s population will live in cities, and the greatest growth in urban populations will take place in the least developed countries. This presents many governments with considerable challenges related to urban governance and the provision of services and opportunities to a burgeoning urban population. Among the concerns is that large youth bulges in urban centers could be a source of political instability and violence. Here, we assess this claim empirically using newly collected data on city-level urban social disorder, ranging from non-violent actions, such as demonstrations and strikes, to violent political actions, such as riots, terrorism, and armed conflict. The dataset covers 55 major cities in Asia and Sub-Saharan Africa for 1960-2006. The study also utilizes a new United Nations Population Division dataset on urban populations by age and sex. The study further considers factors that could condition the effect of age structure, in particular the level of informal employment, economic growth, education, and gender imbalances. The analysis finds that large male youth bulges aged 15-24 are not generally associated with increased risks of either violent or non-violent social disturbance. Furthermore, the proxy measures of"youth exclusion"do not seem to increase the risk that large urban male youth bulges are associated with either form of disturbance. However, several other factors that may be associated with higher levels of youth exclusion - notably absence of democratic institutions, low economic growth, and low levels of secondary educational attainment - are significantly and robustly associated with increasing levels of urban social disturbance. |
| Keywords: | Youth and Governance,Adolescent Health,Population Policies,Urban Housing and Land Settlements,National Urban Development Policies&Strategies |
| Date: | 2009–11–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5110&r=ure |
| By: | Larry Cordell; Karen Dynan; Andreas Lehnert; Nellie Liang; Eileen Mauskopf |
| Abstract: | Delinquencies on residential mortgages and home foreclosures have risen dramatically in the past couple of years. The mortgage losses triggered a broad-based financial crisis and severe recession, which, in turn, exacerbated the initial financial distress faced by homeowners. Although servicers increased their loss mitigation efforts as defaults began to mount, foreclosures continued to occur in cases where both the borrower and investor would be better off if such an outcome were avoided. The U.S. government has engaged in a number of initiatives to reduce such foreclosures. This paper examines the economic underpinnings of the Administration's loan modification program, the Home Affordable Modification Program (HAMP). We argue that HAMP should help many borrowers avoid foreclosure, as its key features—a standardized protocol, incentive fees for servicers, and a requirement that the first lien mortgage payment be reduced to 31 percent of gross income—alleviate some of the previous obstacles to successful modifications. That said, HAMP is not well-suited to address payment problems associated with job loss because the required modification in such cases would often be too costly to qualify for the program. In addition, the focus of the program on reducing the payments associated with the mortgage rather than the principal of the mortgage may limit its effectiveness when the homeowner's equity is sufficiently negative. In this case, recent government efforts to establish a protocol for short sales should be a useful tool in avoiding costly foreclosure. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2009-43&r=ure |
| By: | Ryan Bubb; Alex Kaufman |
| Abstract: | Credit score cutoff rules result in very similar potential borrowers being treated differently by mortgage lenders. Recent research has used variation induced by these rules to investigate the connection between securitization and lender moral hazard in the recent financial crisis. However, the conclusions of such research depend crucially on understanding the origin of these cutoff rules. We offer an equilibrium model in which cutoff rules are a rational response of lenders to per-applicant fixed costs in screening. We then demonstrate that our theory fits the data better than the main alternative theory already in the literature, which supposes cutoff rules are exogenously used by securitizers. Furthermore, we use our theory to interpret the cutoff rule evidence and conclude that mortgage securitizers were in fact aware of and attempted to mitigate the moral hazard problem posed by securitization. |
| Keywords: | Mortgage-backed securities ; Mortgage loans ; Credit scoring systems |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbpp:09-5&r=ure |
| By: | Brendan O’Flaherty (Columbia University - Department of Economics) |
| Abstract: | This is a formal analysis of how homeless shelters should operate: in particular, what quality of accommodations they should provide and how they should help their residents in securing conventional housing. I also examine timing. The results extend to cover optimal police response to street homelessness as well. I draw heavily on the unemployment insurance literature. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:clu:wpaper:0809-15&r=ure |
| By: | Xavier Martinez-Giralt; José María Usategui |
| Abstract: | Transport costs in address models of differentiation are usually modeled as separable of the consumption commodity and with a parametric price. However, there are many sectors in an economy where such modeling is not satisfactory either because transportation is supplied under oligopolistic conditions or because there is a difference (loss) between the amount delivered at the point of production and the amount received at the point of consumption. This paper is a first attempt to tackle these issues proposing to study competition in spatial models using an iceberg-like transport cost technology allowing for concave and convex melting functions. |
| Keywords: | Spatial Competition, Iceberg transport costs |
| JEL: | L12 D42 R32 |
| Date: | 2009–11–11 |
| URL: | http://d.repec.org/n?u=RePEc:aub:autbar:791.09&r=ure |
| By: | Cem Karayalcin; Mehmet Ali Ulubasoglu |
| Abstract: | Many developing economies are characterized by the dominance of a super metropolis. Taking historical Rome as the archetype of a city that centralizes political power to extract resources from the rest of the country, we develop two models of rent-seeking and expropriation which illustrate different mechanisms that relate political competition to economic outcomes. The "voice" model shows that rent-seeking by different interest groups (localized in different specialized cities/regions) will lead to low investment and growth when the number of such groups is small. The "exit" model allows political competition among those with political power (to tax or expropriate from citizens) over a footloose tax base. It shows that when this power is centralized in relatively few urban nodes, tax rates would be higher and growth rates lower. Our empirical work exploits the connection between urban wealth (with the political power it affords) and national soccer championships. By using a cross-country data set for 103 countries for the period 1960-99, we find strong and robust evidence that countries with higher concentrations in urban wealth-as proxied by the number of different cities with championships in national soccer leagues-tend to have lower long-run growth rates. |
| Date: | 2009–11–11 |
| URL: | http://d.repec.org/n?u=RePEc:dkn:econwp:eco_2009_18&r=ure |
| By: | Klevmarken, Anders (Olle Grünewald and Henrik Allansson) |
| Abstract: | A long lasting controversy in Sweden as well as internationally is how to best estimate a price on the services of owner occupied housing in a consumer price index. There is no international consensus and different approaches have been adopted. In this paper we use a true cost-of-living index suggested by one of the authors, apply the model to Swedish data and compare the results to the current Swedish CPI. We also show that within the economic model underlying the true cost-of-living index, alternative operationalizations of the index give rather different results. The choice between these alternatives depends upon the primary purpose of the index. |
| Keywords: | Price index; cost-of-living index; compensation index; price of housing services |
| JEL: | C43 D91 |
| Date: | 2009–11–18 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uunewp:2009_015&r=ure |
| By: | Addison-Smyth, Diarmaid (Central Bank and Financial Services Authority of Ireland); McQuinn, Kieran (Central Bank and Financial Services Authority of Ireland); O' Reilly, Gerard (Central Bank and Financial Services Authority of Ireland) |
| Abstract: | The speed and severity of the decline in the Irish fiscal position in recent years raises a number of important issues regarding the assessment of fiscal policy within the EU. From a position of relative strength, with large surpluses and low debt to GDP ratio, the Irish public finances have rapidly deteriorated, culminating in an Excessive Deficit Procedure being launched in early 2009. In hindsight, it is evident that tax revenues were on an unsustainable path in recent years due, in large part, to structural imbalances within the economy, mainly associated with the housing market. The excess growth in the latter culminated in large and transitory tax revenue windfalls, which ultimately proved unsustainable. These windfalls contributed to large general government and cyclically adjusted budget surpluses. This paper seeks to quantify the windfall gains associated with property taxes through modelling housing related tax receipts over the period 2002 to 2009. From this, estimates are derived as to the underlying or property adjusted fiscal position, which is found in various years, to have diverged greatly from actual outturns. |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:cbi:wpaper:10/rt/09&r=ure |
| By: | Juan Miguel Benito (Universidad Pública de Navarra (Spain)); Pablo Brañas-Garza (Department of Economic Theory and Economic History, University of Granada.); Penélope Hernández (Universitat de Valéncia and ERI-CES (Spain)); Juan A. Sanchis (Universitat de Valéncia and ERI-CES (Spain)) |
| Abstract: | This work shows the results of experiments where subjects play the Schelling's spatial proximity model (1969, 1971a), in which choices are made sequentially, and a variation of it where the decision-making is simultaneous. The results of the sequential experiments are identical to Schelling's prediction: subjects finish in a segregated equilibrium. Likewise, in the variant of simultaneous decision the same result is reached: segregation. Subjects’ heterogeneity generates a series of focal points in the first round; the subjects in order to locate themselves use these focal points immediately, and as a result, the segregation takes place again. |
| Keywords: | Schelling models, economic experiments, segregation |
| Date: | 2009–09–29 |
| URL: | http://d.repec.org/n?u=RePEc:gra:wpaper:09/06&r=ure |
| By: | William Joe |
| Abstract: | Migration decisions to urban areas that are backed by economic rationale and attempts to understand gains accruing to individuals from migration, in terms of poverty outcomes are analysed. The analysis is based on the 55th round survey data on Employment - Unemployment Survey 1999-2000 (EUS) provided by the National Sample Survey Organisation. A broad descriptive socio-economic profiling of the migrant households in urban India and explore the dynamics of poverty among interstate as well as intrastate migrants to urban destinations are undertaken. [WP 414]. |
| Keywords: | migration, urban areas, economic, developing countries individuals, poverty, employment, Unemployment Survey, socio-economic, migrant, households, India, urban, |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2287&r=ure |
| By: | William Kerr |
| Abstract: | The ethnic composition of US inventors is undergoing a significant transformation, with deep impacts for the overall agglomeration of US innovation. This study applies an ethnic-name database to individual US patent records to explore these trends with greater detail. The contributions of Chinese and Indian scientists and engineers to US technology formation increase dramatically in the 1990s. At the same time, these ethnic inventors became more spatially concentrated across US cities. The combination of these two factors helps stop and reverse long-term declines in overall inventor agglomeration evident in the 1970s and 1980s. The heightened ethnic agglomeration is particularly evident in industry patents for high-tech sectors, and similar trends are not found in institutions constrained from agglomerating (e.g., universities, government). |
| JEL: | F15 F22 J44 J61 O31 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15501&r=ure |
| By: | Sabrina Di Addario (Bank of Italy); Daniela Vuri (University of Rome Tor Vergata) |
| Abstract: | We analyze empirically the effects of urban agglomeration on Italian college graduates’ work possibilities as entrepreneurs three years after graduation. We find that each 100,000 inhabitant-increase in the size of the individual’s province of work reduces the chances of being an entrepreneur by0.2 per cent. This result is robust to controlling for regional fix effects and to instrumenting urbanization with three different sets of instruments. However, a positive urbanization externality emerges after taking into account urban amenities and dis-amenities, and, above all, provinces’ competition and cost of labor. In this case, every 100,000 inhabitant-increase raises the chance of entrepreneurship by 2.4 percent. Finally, as long as they succeed in entering the largest markets, young entrepreneurs are able to reap off the benefits of urbanization externalities: every 100,000 inhabitant-increase in the province’s population raises entrepreneurs’ net hourly income by 0.2 percent. |
| Keywords: | Labor market transitions; Urbanization |
| JEL: | R12 J24 J21 |
| Date: | 2009–11–17 |
| URL: | http://d.repec.org/n?u=RePEc:csl:devewp:280&r=ure |
| By: | Kenneth P. Brevoort |
| Abstract: | Using a proprietary dataset of credit bureau records, Cohen-Cole (2008) finds that banks set credit limits on revolving accounts based in part on the racial composition of the neighborhood in which each borrower resides. This paper evaluates the evidence presented in that working paper using the same proprietary database of credit bureau records. The replication effort presented in this paper suggests that decisions about how to calculate the variables used in that study may have resulted in the unnecessary exclusion of one-fifth of available observations from the estimation samples and may have increased the size of the reported effect by over 25 percent. Furthermore, this analysis suggests that when a control for neighborhood income is added to the estimations, the results presented as evidence of redlining activities disappear. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2009-39&r=ure |
| By: | Claire Dujardin (Université catholique de Louvain, CORE, Voie du Roman Pays, 34, B-1348 Louvain-la-Neuve, Bel- gium); Florence Goffette-Nagot (University of Lyon; CNRS, UMR 5824, GATE, France) |
| Abstract: | The aim of this paper is to test for the influence of neighborhood deprivation on individual unemployment probability in the case of Lyon (France). We estimate a bivariate probit model of unemployment and location in a deprived neighborhood. Our identiï¬cation strategy is twofold. First, we instrument neighborhood type by the gender composition of household’s children and the spouse’s workplace. Second, we use the methodology proposed by Altonji et al. (2005), that in our case consists in making hypotheses as to the correlation between the unobservables that determine unemployment and the unobservables that influence the selection into neighborhood types. Our results show that the effect of neighborhood deprivation is not significantly different from zero in the bivariate probit with exclusion restrictions. We also show that a correlation of the unobservables as low as ten percent of the correlation of observables is sufficient to explain the positive neighborhood effect that is observed when endogeneity is not accounted for. |
| Keywords: | Neighborhood effects, unemployment, simultaneous probit models, instrumental variables, selection on unobservables |
| JEL: | R2 I32 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:0924&r=ure |
| By: | Gadi Barlevy; Derek Neal |
| Abstract: | We propose an incentive pay scheme for educators that links educator compensation to the ranks of their students within appropriately defined comparison sets, and we show that under certain conditions our scheme induces teachers to allocate socially optimal levels of effort to all students. Because this scheme employs only ordinal information, our scheme allows education authorities to employ completely new assessments at each testing date without ever having to equate various assessment forms. This approach removes incentives for teachers to teach to a particular assessment form and eliminates opportunities to influence reward pay by corrupting the equating process or the scales used to report assessment results. Our system links compensation to the outcomes of properly seeded contests rather than cardinal measures of achievement growth. Thus, education authorities can employ our incentive scheme for educators while employing a separate system for measuring growth in student achievement that involves no stakes for educators. This approach does not create direct incentives for educators to take actions that contaminate the measurement of student progress. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-09-09&r=ure |
| By: | Jaison R. Abel; Richard Deitz |
| Abstract: | We investigate whether the degree production and research and development (R&D) activities of colleges and universities are related to the amount and types of human capital present in the metropolitan areas where the institutions are located. We find that degree production has only a small positive relationship with local stocks of human capital, suggesting that migration plays an important role in the geographic distribution of human capital. Moreover, we show that spillovers from academic R&D activities tilt the structure of local labor markets toward occupations requiring innovation and technical training. These findings demonstrate that colleges and universities raise local human capital levels by increasing both the supply of and demand for skill. |
| Keywords: | Research and development ; Human capital ; Universities and colleges ; Regional economics ; Labor market |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednsr:401&r=ure |
| By: | Simonetta Botarelli |
| Abstract: | Management choices pertaining to local governments’ functions and services arise even from their autonomy degree; such a degree is also due to the process of constitutional revision and reform. Over recent years administrative decentralization caused a growth of local governments’ (in particular municipalities) financial autonomy through an initial process of fiscal federalism. Anyway, as it happens for many fiscal and financial issues, the provision for decentralized functions had to face a remarkable difference between the original plan and the actual reform. This paper will focus on the chosen path, by trying to outline different periods and those choices which characterized them, as well as local governments’ behaviour aimed to a higher responsibilization as for own choices and expenditure policies with respect to citizens and electors’ evaluation. |
| Keywords: | Local Government, Intergovernmental Relations, State and Local Taxation. |
| JEL: | H7 H72 H77 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:usi:depfid:0309&r=ure |
| By: | Toshihiro Matsumura; Noriaki Matsushima |
| Abstract: | We investigate the effects of restricting locations of firms into Hotelling duopoly models. In the standard location-price models, the equilibrium distance between firms is too large from the viewpoint of consumer welfare. Thus, restricting locations of firms and reducing the distance between firms improve consumer welfare, through lower prices and smaller transportation costs for consumers. We introduce strategic reward contracts into the location-price models. We find that in contrast to the above existing result, restriction of the locations of firms reduces consumer welfare. Restricting locations of the firms reduces transportation costs but increases the prices through the change of strategic commitments by the firms, and it yields a counterintuitive result. |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:0761&r=ure |
| By: | William Kerr; Ramana Nanda |
| Abstract: | We examine the effect of US branch banking deregulations on the entry size of new firms using micro-data from the US Census Bureau. We find that the average entry size for startups did not change following the deregulations. However, among firms that survived at least four years, a greater proportion of firms entered either at their maximum size or closer to the maximum size in the first year. The magnitude of these effects were small compared to the much larger changes in entry rates of small firms following the reforms. Our results highlight that this large-scale entry at the extensive margin can obscure the more subtle intensive margin effects of changes in financing constraints. |
| JEL: | E44 G21 L26 L43 M13 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15499&r=ure |
| By: | González-Val, Rafael; Pueyo, Fernando |
| Abstract: | In this paper we present a model integrating characteristics of the New Economic Geography, the theory of endogenous growth and the economy of natural resources. This theoretical framework enables us to study explicitly the effect of “first nature causes” in the concentration of economic activity, more specifically, the consequences of an asymmetrical distribution of natural resources. The natural resource we consider appears as a localized input in one of the two countries, giving firms located in that country a cost advantage. In this context, after a decrease in transport costs, firms decide to move to the country with the greatest domestic demand and market size, where they can take more advantage of increasing returns, despite the cost advantage of locating in the South, due to the presence of the natural resource. |
| Keywords: | industrial location; endogenous growth; renewable resource; geography |
| JEL: | O30 R12 Q20 F43 |
| Date: | 2009–11–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:18586&r=ure |
| By: | Giovanni Busetta (Universit… di Messina, Department of Economics, Statistics, Mathematics, and Sociology V. Pareto); Alberto Zazzaro (Universit… Politecnica delle Marche, Department of Economics, MoFiR) |
| Abstract: | In many countries, Mutual Loan-Guarantee Societies (MLGSs) are assuming ever-increasing importance for small business lending. In this paper we provide a theory to rationalise the raison d'^etre of MLGSs. The basic intuition is that the foundation for MLGSs lies in the inefficiencies created by adverse selection, when borrowers do not have enough collateralisable wealth to satisfy collateral requirements and induce self-selecting contracts. In this setting, we view MLGSs as a wealth-pooling mechanism that allows otherwise inefficiently rationed borrowers to obtain credit. We focus on the case of large, complex urban economies where potential entrepreneurs are numerous and possess no more information about each other than do banks. Despite our extreme assumption on information availability, we show that MLGSs can be characterized by assortative matching in which only safe borrowers have an incentive to join the mutual society. |
| Keywords: | Collateral, Group formation, Mutual Loan Guarantee Society, Small business lending |
| JEL: | D82 G21 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:anc:wmofir:33&r=ure |
| By: | Evan Borkum (Columbia University - Department of Economics) |
| Abstract: | The charging of school user fees is a much-debated policy issue in developing countries. In this paper, I evaluate the impact of a South African fee elimination program that was targeted at the poorest two quintiles of schools based on a community poverty score. Fixed effects estimates find that the program increased enrollment by almost 2% in treated secondary schools, an increase concentrated in earlier secondary grades. There is substantial heterogeneity in the estimated secondary school effect: it is driven entirely by an increase of around 3.5% in the poorer of the two treated quintiles. Regression discontinuity estimates confirm that the relatively wealthy schools near the treatment cutoff did not experience any effects on enrollment. Overall, the abolition of fees seems to have been reasonably effective in increasing secondary school enrollment in particularly poor communities. This is despite the fact that the eliminated fees were relatively low, comprising only around 1.5% of annual household income (per child) in these communities. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:clu:wpaper:0910-06&r=ure |
| By: | Hensen Maud M.; Vries M. Robert de; Cörvers Frank (ROA rm) |
| Abstract: | In this article we investigate the relationship between geographic mobility andeducation-job mismatch in the Netherlands. We focus on the role of geographicmobility in reducing the probability of graduates working (i) jobs below theireducation level; (ii) jobs outside their study fi eld; (iii) part-time jobs; (iv) fl exiblejobs; or (v) jobs paid below the wage expected at the beginning of the career. For thispurpose we use data on secondary and higher vocational education graduates in theperiod 1996–2001. We show that graduates who are mobile have higher probabilityof fi nding jobs at the acquired education level than those who are not. Moreover,mobile graduates have higher probability of fi nding full-time or permanent jobs.Th is suggests that mobility is sought to prevent not only having to take a job belowthe acquired education level, but also other education-job mismatches; graduates arespatially fl exible particularly to ensure full-time jobs. |
| Keywords: | education, training and the labour market; |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:umaror:2009009&r=ure |
| By: | Callan, Tim; Keane, Claire; Walsh, John R. |
| Keywords: | Ireland |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp322&r=ure |