|
on Urban and Real Estate Economics |
| By: | Sergejs Gubins (VU University Amsterdam); Erik T. Verhoef (VU University Amsterdam) |
| Abstract: | We consider a monocentric city where a traffic bottleneck is located at the entrance of the central business district. The commuters' choices of the departure times from home, residential location, and lot size, are all endogenous. We show that elimination of queuing time under optimal road pricing induces individuals to spend more time at home and to have larger houses, causing urban sprawl. This is opposite to the typical results of urban models with static congestion, which predict cities to become denser with road pricing. |
| Keywords: | dynamic traffic congestion; urban equilibrium; road pricing; bottleneck model; monocentric model |
| JEL: | D62 R21 R41 R48 |
| Date: | 2012–12–10 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:20120137&r=ure |
| By: | Andersson, Martin (CIRCLE, Lund University); Klaesson, Johan (CEnSE, Jönköping International Business School); P. Larsson, Johan (CEnSE,Jönköping International Business School) |
| Abstract: | We analyze the geographic scale at which density externalities operate and their attenuation with distance. Using square grid data at a fine spatial resolution, we find that a doubling of neighborhood density, measured as the density of 1 km2 squares, yields an increase in the overall wage-level of a square in the order of 3 percent. The density of the wider region to which the neighborhood belongs shows a significantly smaller effect. Highly educated workers gain more from proximity to others, and when we decrease the sizes of the squares the effect is still stronger for such workers. Density effects operate simultaneously at different spatial levels, and we argue that the neighborhood effects are more prone to capture localized non-market effects, such as knowledge spillovers driven by face-to-face interaction. |
| Keywords: | spatial scale; density; productivity; spatial dependence; geo-coded data; external scale economies; agglomeration externalities; Sweden; Modifiable Areal Unit Problem (MAUP) |
| JEL: | C21 R11 R12 |
| Date: | 2012–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lucirc:2012_010&r=ure |
| By: | Pierre-Philippe Combes (Aix-Marseille University (Aix-Marseille School of Economics), CNRS & EHESS.); Gilles Duranton (University of Pennsylvania); Laurent Gobillon (http://www.amse-aixmarseille.fr/sites/default/files/_dt/2012/wp_2012_-_nr_35.pdf) |
| Abstract: | We develop a new methodology to estimate the elasticity of urban costs with respect to city population using French land price data. Our preferred estimate, which handles a number of estimation concerns, stands at 0.041. Our approach also yields a number of intermediate outputs of independent interest such as a distance gradient for land prices and the elasticity of unit land prices with respect to city population. For the latter, our preferred estimate is 0.72. |
| Keywords: | urban costs, land prices, land use, agglomeration. |
| JEL: | R14 R21 R31 |
| Date: | 2012–11 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:1235&r=ure |
| By: | Benoît Schmutz (Aix-Marseille University (Aix-Marseille School of Economics), CNRS & EHESS and Georgetown University) |
| Abstract: | This paper adapts a framework à-la Hotelling to an urban context in order to study the impact of public housing on the level of segregation in a fixed-size city where consumers differ both in income and taste. In this city, the market allocation of the population is characterized by partial segregation: both rich and poor consumers can be found in both neighborhoods. Public authorities replace a fraction of the housing stock with public housing. This policy will not decrease segregation if applicants are not screened according to their income level. Any departure from the optimal level of screening has to be compensated for by a larger program. The final policy mix will then be determined by the extent to which public authorities have the ability, either to screen applicants, or to fund more public units. However, this trade-off will be softened when taking neighborhood externalities into account, thanks to a snowball effect of public housing on neighborhood quality. |
| Keywords: | Public housing, segregation, sorting, Hotelling, rationing. |
| JEL: | R2 R3 |
| Date: | 2012–10–17 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:1228&r=ure |
| By: | Matthias Duschl (Department of Geography, University Marburg); Tobias Scholl (House of Logistics and Mobility GmbH, University Marburg); Thomas Brenner (Department of Geography, Philipps University Marburg); Dennis Luxen (Karlsruhe Institute of Technology); Falk Raschke (House of Logistics and Mobility GmbH, University Frankfurt) |
| Abstract: | This paper studies the industry-specific relationship between industrial clustering and firm growth. Micro-geographically defined agglomeration measures, free of the modifiable areal unit problem (MAUP), are used to study 23 industries. The spatial impacts of agglomeration of related economic and knowledge generating activities are examined by using travel time distances, a flexible log-logistic decay function framework and quantile regression techniques. We find that firms’ growth prospects tend to be hampered by the agglomeration of own-industry employment, but improved by proximate scientific activity. Results depend on the kind and age of industry. Furthermore, the optimal decay functions that measure agglomeration effects considerably vary both between the industries and variables. Three illustrative cases of industries are discussed in more details. |
| Keywords: | Firm growth, industrial clusters, agglomeration, MAUP, distance decay function, quantile regression |
| JEL: | C31 D92 L25 R11 |
| Date: | 2012–12–19 |
| URL: | http://d.repec.org/n?u=RePEc:pum:wpaper:2012-06&r=ure |
| By: | Daniel Cooper; Rüdiger Bachmann |
| Abstract: | Using data from the Panel Study of Income Dynamics, this paper examines the flow of U.S. households within and between two distinct segments of the housing market — renter-occupied properties and owner-occupied properties. The paper provides relevant empirical moments for microfounded models of the housing sector. In particular, net flows in the housing market are substantially smaller than the gross flows, as is the case in the literature on labor market flows. Housing market turnover also exhibits substantial heterogeneity in household moving rates, the long-run moving trends, and the cyclical patterns of household moving decisions. Moves by renters tend to lead movements in real GDP, while moves by homeowners are procyclical and/or slightly lag the cycle. The paper further shows that the secular decline in household moves over time is driven by reduced within-sector moves. Taken together, the paper's results imply that models aiming to describe housing market flows will have to feature substantial nonlinearities and/or multiple sector-specific (owner versus renter) shocks. |
| Keywords: | Housing ; Rental housing |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbwp:12-17&r=ure |
| By: | Chris Cunningham; Robert R. Reed |
| Abstract: | We examine the relationship between housing equity and wage earnings. We first provide a simple model of wage bargaining where failure leads to both job loss and mortgage default. Moreover, foreclosure generates disutility beyond selling a home. We test this prediction using nine waves of the national American Housing Survey. Employing a rich set of time and place controls, individual fixed effects, and an instrumental variable strategy, we find that people with an underwater mortgage command a significantly lower wage than other homeowners. This finding survives a number of robustness checks. We also include other determinants of "house lock" such as a favorable mortgage interest rate relative to the current rate and a capped property tax assessment, but we do not find these factors lower earnings. We conclude that negative equity matters because default is unpleasant or costly, not because it precludes an out-of-state job search.. |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedawp:2012-20&r=ure |
| By: | Carlos Carreira (Faculty of Ecobomics University of Coimbra and GEMF); Luís Peres Lopes (Faculty of Ecobomics University of Coimbra and GEMF) |
| Abstract: | This paper analyses the impact on firm-level total factor productivity of both agglomeration economies and regional knowledge, using an unbalanced panel of Portuguese manufacturing firms covering the period 1996–2004. Controlling for the endogeneity problem using the Arellano and Bond (1991) difference GMM estimator, we found that both localization and urbanization economies have a significant and positive effect on firms’ TFP, with the latter playing the most important role. Sectoral specialization economies are important for small and medium firms, but not for large firms. However, larger firms profit more from regional knowledge than smaller ones. |
| Keywords: | agglomeration economies, regional knowledge, total factor productivity, small firms. |
| JEL: | R11 R12 R15 O47 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:gmf:wpaper:2012-21&r=ure |
| By: | Pierre André (THEMA, Universite de Cergy-Pontoise and THEMA) |
| Abstract: | This paper investigates the connection between grade repetition and school outcomes. It uses the fact that pupils need to meet class-specific standards to pass to the next grade. It measures the differences in the link between learning achievement and grade repetition between classes with different requirements to pass to the next grade. This double difference identifies the effect of grade repetition. The results show a negative effect of the grade repetition decision on the probability to be enrolled at school the next year, and on the probability to start secondary school. Despite this mechanism, pupils from schools with tough grade repetition policies are on average more likely to be enrolled during the follow-up survey and to start secondary school. These schools do not seem to be located in particularly favorable places for this. This emphasizes that grade repetition policies might have other consequences than affecting repeating pupils. |
| Keywords: | Grade repetition, School demand, School dropouts, Senegal |
| JEL: | D12 I28 O12 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:ema:worpap:2012-47&r=ure |
| By: | Karl E. Case (Wellesley College); John M. Quigley; Robert J. Shiller (Cowles Foundation, Yale University) |
| Abstract: | We re-examine the links between changes in housing wealth, financial wealth, and consumer spending. We extend a panel of U.S. states observed quarterly during the seventeen-year period, 1982 through 1999, to the thirty-seven year period, 1975 through 2012Q2. Using techniques reported previously, we impute the aggregate value of owner-occupied housing, the value of financial assets, and measures of aggregate consumption for each of the geographic units over time. We estimate regression models in levels, first differences and in error-correction form, relating per capita consumption to per capita income and wealth. We find a statistically significant and rather large effect of housing wealth upon household consumption. This effect is consistently larger than the effect of stock market wealth upon consumption. In our earlier version of this paper we found that households increase their spending when house prices rise, but we found no significant decrease in consumption when house prices fall. The results presented here with the extended data now show that declines in house prices stimulate large and significant decreases in household spending. The elasticities implied by this work are large. An increase in real housing wealth comparable to the rise between 2001 and 2005 would, over the four years, push up household spending by a total of about 4.3%. A decrease in real housing wealth comparable to the crash which took place between 2005 and 2009 would lead to a drop of about 3.5%. |
| JEL: | E02 G1 R31 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:cwl:cwldpp:1884&r=ure |
| By: | Henry Overman |
| Abstract: | The UK is facing not one but two housing crises. The first is a short-term fall in prices and construction whcih is both driven by and driving the recession. The second and more profound is the overall shortage of housing and the problems of affordability that this generates. |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepcnp:382&r=ure |
| By: | Robert J. Hill (Karl-Franzens University of Graz); Iqbal A. Syed (University of New South Wales) |
| Abstract: | Departures of the housing market from equilibrium can be detected by comparing the actual price-rent ratio with the user cost of owner occupying. Empirical implementation of this idea, however, is problematic for two reasons. First, the price-rent ratio needs to be quality adjusted. Second, the expected capital gain – an important input into the user cost formula – is not directly observable. Using a large data set for Sydney-Australia, we show how these problems can be resolved using hedonic methods. Otherwise the user cost approach can generate highly misleading results. |
| Keywords: | Real estate; Housing market; Hedonic model; Price-rent ratio; Rental yield; Quality adjustment; User cost; Capital gains |
| JEL: | C43 E01 E31 R31 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:grz:wpaper:2012-08&r=ure |
| By: | Kristian Giesen; Jens Suedekum |
| Abstract: | Older cities in the US tend to be larger than younger ones. The distribution of city sizes is, therefore, systematically related to the country's city age distribution. We introduce endogenous city creation into a dynamic economic model of an urban system. All cities exhibit the same long-run growth rate (Gibrat's law), but young cities initially grow faster. The double Pareto lognormal (DPLN) emerges as the city size distribution in our model. The DPLN unifies the lognormal and the Pareto distribution (Zipf's law), and closely fits US city size data. This evidence can potentially resolve several debates from the recent literature. |
| Keywords: | Zipfs law, Gibrats law, city size distributions, city age, DPLN distribution |
| JEL: | R11 R12 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:cep:sercdp:0122&r=ure |
| By: | Dionissi Aliprantis |
| Abstract: | Trying to learn about neighborhood effects from the Moving to Opportunity (MTO) housing mobility experiment by focusing on its program effects obfuscates the evidence on neighborhood effects from MTO. This paper shows that using Intent-to-Treat (ITT) and Treatment-on-the-Treated (TOT) program effects from MTO to indirectly draw conclusions about neighborhood effects (1) offers no advantage for learning about neighborhood effects over directly estimating neighborhood effects, and (2) answers an ill-posed question as a result of allowing central identifying assumptions to be made implicitly. Focusing attention on directly specifying and estimating models of neighborhood effects, the paper presents empirical evidence that MTO only identifies effects from moves between neighborhoods of low quality. These results have broad implications for the way program effects are used to learn about parameters of other models, and they have not been sufficiently addressed in the literature to interpret the evidence from MTO as a test of Wilson (1987). |
| Keywords: | Housing policy ; Poverty |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedcwp:1233&r=ure |
| By: | Voigtländer, Michael |
| Abstract: | The last decade has been marked by cycles of excessive boom and bust in the housing market. However, not all countries have experienced high volatility in their house prices. Indeed, Germany has been unique in retaining flat price levels over the whole period and failing to respond to any of the macroeconomic shocks. The main reason for this stability can be found in real estate finance and in the existence of a sophisticated rental market. While in other countries monetary stimuli are effectively transmitted to the real economy via the housing market, the German insistence on prudential lending isolates the housing market from financial market distortions. By demanding high deposits, aligning lending to the mortgage lending value instead of the market value and by offering predominantly fixed-rate mortgages, banks reduce the risk of defaults and thus contribute to stability in the market. This system has evolved as a result not of regulations but of a sophisticated rental market which enables households to save their own funds for house purchases. This, in turn, explains the preference for fixed-rate mortgages. |
| Keywords: | German housing market; housing finance; transmission of monetary policy; rental market |
| JEL: | E2 R20 E44 |
| Date: | 2012–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:43315&r=ure |
| By: | Manchala, Ravibabu; Vagvala, Phani Sree |
| Abstract: | National Urban Transport Policy, the guiding document for urban transport in India, emphasis movement of people and goods and not vehicles. The paper establishes that investment on walking and cycling facilities, and surface rail projects give maximum benefit compared to high cost motorised transport and metro rail. From past studies the paper also brings out that share of cycling and walking is very high – varying between 58 and 30 % in different cities. The paper identifies that contrary to benefits accrued and usage patterns, analysis of investment - both past and future projections, shows that metro rail and road development projects are preferred crowding out the other investment. The paper also identifies the reasons for distortion by identifying various groups working in the policy and their distorted perception on urban transport development. Finally the paper recommends increased investment in non motorised facilities by retrieving road space. To facilitate investment in surface rail it is necessary that Ministry of Railways, Ministry of Urban Development and Planning Commission should jointly work out the strategies. The study also recommends recasting of academic programs in urban transport to make them multi disciplinary and policy oriented. |
| Keywords: | Urban transport; Non motorised transport; Public transport; Metro rail; Cycling and walking |
| JEL: | L91 L98 R41 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:22874&r=ure |
| By: | Elliot Anenberg; Edward Kung |
| Abstract: | Using a novel dataset which merges real estate listings with real estate transactions in San Francisco from 2007-2009, we present new evidence that foreclosures causally depress nearby home prices. We show that this decrease occurs only after the foreclosed home is listed for sale, which suggests that the effect is due to the additional housing supply created by foreclosure rather than from neglect of the foreclosed property. Consistent with a framework where a foreclosed home simply increases supply, we find that new listings of foreclosed homes and non-foreclosed homes each lower sales prices of homes within 0.1 miles of the listing by 1 percent. |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2012-84&r=ure |
| By: | Crescenzi, Riccardo; Rodríguez-Pose, Andrés |
| Abstract: | This paper looks at the genesis of innovation in the United States from a territorial perspective. The analysis aims to disentangle the impact of local R&D expenditure from other contextual conditions supportive of the process of innovation. Particular emphasis is devoted to the role of socio-economic factors and systems of innovation conditions (‘social filter’ conditions) and to their impact on the returns of R&D expenditure in different territorial contexts. The empirical analysis is based on a Regional Knowledge Production Function approach, leading to an empirical model estimated by means of panel data analysis for the period between 1994 and 2007 at the US Bureau of Economic Analysis (BEA)-Economic Area level. The results unveil the complexity of the territorial dynamics of innovation of the US. Local R&D investments are important predictors for regional innovative performance and their impact is highly localized. However, social filter conditions are fundamental for the productivity of innovation efforts. |
| Keywords: | Innovation; R&D; Socioeconomic conditions; Systems of innovation; United States |
| JEL: | O32 O33 R11 R12 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:9265&r=ure |
| By: | Robert Bifulco; Jason M. Fletcher; Sun Jung Oh; Stephen L. Ross |
| Abstract: | Using data from the National Longitudinal Study of Adolescent Health, this study examines the impact of high school cohort composition on the educational and labor market outcomes of individuals during their early 20s and again during their late 20s and early 30s. We find that the positive effects of having more high school classmates with a college educated mother on college attendance in the years immediately following high school fade out as students reach their later 20s and early 30s, and are not followed by comparable effects on college completion and labor market outcomes. |
| JEL: | I21 I24 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18648&r=ure |
| By: | Manchala, Ravibabu; Vagvala, Phani Sree |
| Abstract: | Objective Emerging economies like India are investing heavily in rapid development of urban transport infrastructure for public transport. Though the initial efforts started with three modes - metro rail, Bus Rapid Transit (BRT) and surface rail; currently investments are being made mainly in metro rail and BRT. In spite of lack of patronage, surface rail, which helped develop many cities in India, is playing a prominent role in movement of urban commuters. The objective of research is to assess the viability of surface rail for movement of urban commuters in comparison to metro rail and BRT. To achieve this objective research questions asked were: • How do cost, capacity and cost per unit capacity compare between metro rail, surface rail and BRT systems? • What is the current urban form of Indian cities and policy framework to accommodate future urbanisation? • What does this imply for planning of public transport? • Can the surface rail serve the city core in addition to serving the peripheral areas? If so, what should be the planning strategies for the surface rail systems? • What are the implications for public transport in India and can the BRT, metro rail and surface rail be symbiotically combined to generate a more purposeful and distinct public transport for Indian UAs? If so, what are the investment implications? • If the answer to the above is affirmative, what policy measures are required to integrate surface rail into transit systems of Indian UAs? Methodology The methodology adapted was : • Comparative assessment of cost, capacity and cost per unit capacity for the three modes which established that cost per unit capacity for surface rail is one twentieth of metro and one fourth of BRT • Review of urbanisation trends and policies • Finally, review of rail network in the 50 urban agglomerations (UAs) with population more than million to see the extent of rail network serving them and whether it can serve the core city. Results The results indicate that during the 12th plan 747 kilometres (kms) of metro rail and 989 kms of regional rail systems are being developed to serve 10 large UAs. As against this, by reallocation of the resources a more elaborate urban rail network of 6628 kms can be upgraded and 3000 kms of new system can be added in all the 49 UAs. Another major finding is the hidden benefits given to metro rail compared to surface rail systems. Implications for Policy Immediate policy implication is to undertake surface rail development on priority before metro rail development is taken up. Policy implication would be to set up an institutional mechanism for fast development of surface rail. This would be possible if apex policy making bodies of Ministry of Urban Development (MoUD) for urban transport, Ministry of Railways (MoR) for surface rail and the Planning Commissions jointly review and formulate guidelines for surface rail and metro rail projects. This would facilitate concerted action for development of surface rail at all levels. |
| Keywords: | Surface rail; urban transit; Bus rapid transit; Metro rail; Urban Agglomerations; India |
| JEL: | R40 R42 R41 R48 |
| Date: | 2012–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:43357&r=ure |
| By: | Jeffrey Lin |
| Abstract: | In this paper, I study long-run population changes across U.S. metropolitan areas. First, I argue that changes over a long period of time in the geographic distribution of population can be informative about the so-called \resilience" of regions. Using the censuses of population from1790 to 2010, I find that persistent declines, lasting two decades or more, are somewhat rare among metropolitan areas in U.S. history, though more common recently. Incorporating data on historical factors, I find that metropolitan areas that have experienced extended periods of weak population growth tend to be smaller in population, less industrially diverse, and less educated. These historical correlations inform the construction of a regional resilience index. |
| Keywords: | Population ; Metropolitan areas |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpwp:13-1&r=ure |
| By: | Stefan Bauernschuster; Oliver Falck; Stephan Heblich; Jens Suedekum |
| Abstract: | Why are better educated and more risk-friendly persons more mobile across regions? To answer this question, we use micro data on internal migrants from the German Socio-Economic Panel (SOEP) 2000–2006 and merge this information with a unique proxy for region-pair-specific cultural distances across German regions constructed from historical local dialect patterns. Our findings indicate that risk-loving and skilled people are more mobile over longer distances because they are more willing to cross cultural boundaries and move to regions that are culturally different from their homes. Other types of distance-related migration costs cannot explain the lower distance sensitivity of educated and risk-loving individuals. |
| Keywords: | Migration, culture, distance, human capital, risk attitudes |
| JEL: | J61 R23 D81 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp522&r=ure |
| By: | Anna Golejewska (Faculty of Economics, University of Gdansk) |
| Abstract: | The paper relates to factors determining regional competitiveness in Poland, the Czech Republic, Hungary and Slovakia - the Visegrad Group. The study starts from a comprehensive survey of the literature on regional competitiveness and the potential effects of innovation. The theoretical section is supplemented by empirical one. The aim of the empirical analysis is to investigate the regional diversity of innovativeness and competitiveness in the group of 35 regions (NUTS 2 level) over the period 2001-2008. It is based on one data source: Eurostat Regional Statistics. I applied two classical methods of cluster analysis. The results of non-hierarchical k-means clustering algorithm were compared with the results of hierarchical Ward’s method. The results for the Visegrad Group show faster development of capital regions and diversity of regional competitiveness and innovativeness. According to the results, one can suppose that innovative inputs were transformed in innovative outputs and that innovations had a positive and growing impact on regional competitiveness in the Visegrad Group, however further research is still needed. The major conclusion of the cluster analysis is that the development of regions in the Visegrad Group depends on their nationality – regions cluster within borders. Analysing the results, one should not forget that they are based on selected variables, which are a resultant of –in some measure- random choice and data accessibility. |
| Keywords: | regional competitiveness, regional growth, innovation, cluster analysis, Central and Eastern European Countries |
| JEL: | R11 C38 P25 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:gda:wpaper:1203&r=ure |
| By: | Pierre André; Jean-Luc Demonsant (THEMA, Universite de Cergy-Pontoise and THEMA; EPS/INSTEAD) |
| Abstract: | This paper studies the substitution between formal education and informal religious education for Senegalese households. We use the timing of the opening of formal schools to estimate whether Koranic and formal education systems compete for the children’s time. Adapting the diff-in-diff strategy in Duflo (2001), we assess the effect of school openings on Koranic and formal schooling. Our estimates show that formal school openings increase formal education attainment, especially in rural areas. Incidentally, this result highlights the lack of primary schools in rural areas : an additional primary school increases the probability to start primary school by 13 percentage points around this school. We then estimate that an additional formal school decreases the time spent in Koranic schools. This proves that, while both school systems are independent in terms of organization and pedagogical content, they still compete for the children’s time. This might increase the opportunity cost of formal primary school, and can narrow the political consensus around universal primary education. |
| Keywords: | Koranic Schools, School demand, Senegal |
| JEL: | D12 I28 O12 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:ema:worpap:2012-46&r=ure |
| By: | Traag, Tanja (Maastricht University) |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:ner:maastr:urn:nbn:nl:ui:27-31168&r=ure |
| By: | Umar Faruqui; Samah Torchani |
| Abstract: | Using a unique micro-dataset containing real and financial information on Canadian households for 2000–07, the authors address two questions: (1) What is the proportion of households whose consumption displays excess sensitivity to income, and who are likely liquidity constrained? (2) Do house prices affect the ability of Canadian households to smooth their consumption? The authors find that, on average (over the 2000–07 period), about 23 per cent of households in Canada were constrained. Their results suggest that young households with fewer liquid assets, higher education and lower home equity, as well as those that are unmarried, are more likely to be liquidity constrained than other households. The authors’ results also suggest that larger housing equity tends to facilitate consumption smoothing for households in Canada. This provides empirical evidence of a collateral channel linking house prices and consumption. |
| Keywords: | Economic models; Sectoral balance sheet |
| JEL: | C35 D12 D30 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocadp:12-9&r=ure |
| By: | Dieter Gerdesmeier (European Central Bank); Andreja Lenarčič (Bocconi University; Bank of Slovenia); Barbara Roffia (European Central Bank) |
| Abstract: | The main aim of this paper is to apply a method based on fundamentals ─ which has already been applied in the stock market analysis ─ to detect boom/bust in the housing market, with a focus on the euro area. In this context, an underlying model is developed and tested. It turns out that the user cost rate, a demographic variable, the unemployment rate, disposable income (or disposable income per capita), the debt-to-income ratio and, finally, the housing stock are fundamental variables which significantly explain house price developments. Booms and busts are then selected as episodes when the house price index deviates excessively from the levels which would be implied by these economic fundamentals. In addition, a cross-check of the boom/bust episodes based on this method and other statistical and fundamental ones is carried out in order to substantiate the results obtained. Finally, money and credit aggregates are included in the specifications and are found to be useful in explaining boom/busts cycles in house prices. JEL Classification: E37, E44, E51 |
| Keywords: | House prices, booms, busts, quantile regressions, monetary and credit aggregates |
| Date: | 2012–11 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20121493&r=ure |
| By: | Pavlyuk, Dmitry |
| Abstract: | This research is devoted to analysis of efficiency estimation in presence of spatial relationships and spatial heterogeneity in data. We presented a general specification of the spatial stochastic frontier model, which includes spatial lags, spatial autoregressive disturbances and spatial autoregressive inefficiencies. Maximum likelihood estimators are derived for two special cases of the spatial stochastic frontier. Small-sample properties of these estimators and comparison with a standard non-spatial estimator were implemented using a set of Monte Carlo experiments. Finally, we tested our estimators on a real-world data set of European airports and discovered significant spatial components in data. |
| Keywords: | spatial stochastic frontier; maximum likelihood; efficiency; heterogeneity |
| JEL: | C51 L93 C15 C31 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:43390&r=ure |
| By: | Anna Butzin (Institute for Work and Technology Germany); Brigitta Widmaier (Institute for Work and Technology Germany) |
| Abstract: | The paper presents the methodology of Innovation Biographies that has been designed to study the time-space dynamics of knowledge and ways of knowledge combination in innovation processes. Innovation Biographies allow capturing relationships, contextual settings and different kinds of knowledge and enable insights into the evolvement and development of innovations. By following the process of creation with specific interviewing methods and triangulation, the biography of an innovation is reconstructed including the evolution of related knowledge. Data collection is able to transcend sectoral as well as local, regional or national categories and sheds light on cross-sectoral knowledge combinations and its multi-scalar reach. |
| Keywords: | Innovation Biographies, knowledge dynamics, knowledge combinations, time-space paths, multi-level view |
| JEL: | D83 O12 O31 R11 |
| Date: | 2012–12–19 |
| URL: | http://d.repec.org/n?u=RePEc:pum:wpaper:2012-07&r=ure |
| By: | Pal, Sarmistha (University of Surrey); Wahhaj, Zaki (University of Kent) |
| Abstract: | Using data from the Indonesian Family Life Surveys, this paper studies the impact of fiscal decentralisation in Indonesia on local public spending across communities with different types of local institutions. Our results provide evidence of heterogeneity in access to public goods across communities in the period prior to fiscal decentralisation; with significantly greater spending on schools and health centres in communities which observe traditional adat laws (which promote an ethic of mutual cooperation), and less spending on roads, public transport, communications etc. in communities which have a democratic electoral system. Fiscal decentralisation led to an increase in the share of spending on physical infrastructure, as well as a convergence in spending across communities with different types of local institutions. We develop a theoretical model to argue that communities which enjoy a higher level of mutual cooperation would benefit less from investment in public goods which facilitate communication and exchange with outsiders – as these improve the outside options of community members and therefore makes it more difficult to sustain intra-community cooperation. Surprisingly, investment in communications and transport infrastructure in these communities were more restrained during the period of centralised fiscal control. |
| Keywords: | decentralisation, democratisation, mutual co-operation, social and physical infrastructure, local public spending, Indonesia |
| JEL: | D02 H41 O43 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7076&r=ure |
| By: | Alexander M. Danzer; Firat Yaman |
| Abstract: | It is widely debated whether immigrants who live among co-ethnics are less willing to integrate into the host society. Exploiting the quasi-experimental guest worker placement across German regions during the 1960/70s as well as information on immigrants’ inter-ethnic contact networks and social activities, we are able to identify the causal effect of ethnic concentration on social integration. The exogenous placement of immigrants “switches off” observable and unobservable differences in the willingness or ability to integrate which have confounded previous studies. Evidence suggests that the presence of co-ethnics increases migrants’ interaction cost with natives and thus reduces the likelihood of integration. |
| Keywords: | immigrants, integration, enclaves, political participation, culture, social interaction, guest workers |
| JEL: | J15 R23 J61 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp519&r=ure |
| By: | Eliasson, Jonas (KTH); Amelsfort, Dirk van (WSP Analysis & Strategy); Börjesson, Maria (KTH); Brundell-Freij, Karin (WSP Analysis & Strategy); Engelson, Leonid (WSP Analysis & Strategy) |
| Abstract: | This paper compares forecasted effects of the Stockholm congestion charges with actual outcomes. The most important concerns during the design of the congestion charging scheme were the traffic reduction in bottlenecks, the increase in public transport ridership, the decrease of vehicle kilometres in the city centre, and potential traffic effects on circumferential roads. Comparisons of forecasts and actual outcomes show that the transport model predicted all of these factors well enough to allow planners to draw correct conclusions regarding the design and preparations for the scheme. The one major shortcoming was that the static assignment network model was unable to predict the substantial reductions of queuing times. We conclude that the transport model worked well enough to be useful as decision support, performing considerably better than unaided “experts’ judgments”, but that results must be interpreted taking the model’s limitations into account. The positive experiences from the Stockholm congestion charges hence seem to be transferable to other cities in the sense that if a charging system is forecasted to have beneficial effects on congestion, then this is most likely true. |
| Keywords: | Forecast accuracy; Congestion pricing; Model validation; Policy transfer. |
| JEL: | R41 R48 |
| Date: | 2012–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ctswps:2012_031&r=ure |
| By: | Augustyniak, Hanna; Gajewski, Krzysztof; Łaszek, Jacek; Żochowski, Grzegorz |
| Abstract: | We analyse the real estate developer sector in Poland and explain how the housing construction process is financed. The main economic indicators that are used in the profitability analysis are explained in detail. Moreover, we analyse the real estate developer business plan and propose a model to analyse the housing construction process, focusing on the accounting of costs and profits. |
| Keywords: | Real estate development; construction process analysis; business plan |
| JEL: | O18 R31 M21 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:43347&r=ure |
| By: | Sergio Mayordomo (School of Economics and Business Administration, University of Navarra); María Rodríguez-Moreno (European Central Bank); Juan Ignacio Peña (Department of Business Administration, Universidad Carlos III de Madrid) |
| Abstract: | This paper presents a procedure for computing the theoretically optimal portfolio under the assumption that housing is an indivisible, illiquid asset that restricts the portfolio choice decision. The analysis also includes the financial constraints households may face when they apply for external funding. The set of financial assets that constitute the household’s portfolios are bank time deposits, stocks, mortgage, and housing. We compare the theoretically optimal portfolio against Spanish households’ actual choices using a unique data set, the Spanish Survey of Household Finance. In comparison with the optimal portfolio, households significantly underinvest in stocks and deposits. In the case of mortgages, the optimal and actual portfolios weights are not unequal. At a more disaggregated level, some additional differences emerge that are explained by demographic, educational, and income characteristics. |
| Keywords: | Portfolio choice, Households, Indivisible illiquid assets, Financial constraints, Under-investment, Over-investment |
| JEL: | C61 D14 G11 |
| Date: | 2012–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:una:unccee:wp2412&r=ure |
| By: | Jaideep Gupte (Institute of Development Studies) |
| Abstract: | For the first time in close to 100 years, India reports higher population growth in its urbanised areas than across its vast rural landscape. However, a confluence of vast urbanisation and scarcity of resources has implied heightened levels of localised violence, centred in and around already impoverished neighbourhoods. This therefore has a disproportionate impact in further marginalising poor communities, and is at odds with the notion that cities are incontestably and inevitably the context of sustained poverty eradication. And yet, we know relatively little about the mechanics of security provisioning in Indian cities at large. The central argument in this paper is that violent urban spaces have a profound impact on how safety and security are understood by the state as well as the urban poor, thereby redefining the parameters of adequate urban living. I look in detail at how the 1992-1993 riots in Mumbai unfolded in a group of inner-city neighbourhoods, and find that specific acts of brutality and violence during the riots continue to shape current understandings of the „safe city?. In doing so, I also find that the nature and form of informal urban space affects the mechanics by which the state endeavours to control violence, while individual acts of public violence function as markers that legitimate the use of, and reliance on, extralegal forms of security provision. |
| Date: | 2012–09 |
| URL: | http://d.repec.org/n?u=RePEc:hic:wpaper:122&r=ure |
| By: | Yuliya Demyanyk; Elena Loutskina |
| Abstract: | Mortgage companies (MCs) originated about 60% of all mortgages before the 2007 crisis and continue to hold a 30% market share postcrisis. While financial regulations are strictly enforced for depository institutions (banks), they are weakly enforced for MCs even if they are subsidiaries of a bank holding company (BHC). This study documents that the resulting regulatory arbitrage creates incentives for BHCs to engage in risk shifting through their MC affiliates. We show that MCs are established to circumvent the capital requirements and to shield the parent BHCs from loan-related losses. BHCs run the risky mortgage business through their MC affiliates. As compared to bank affiliates of BHCs, the MC affiliates lent more to individuals with lower credit scores, lower incomes, and higher loan-to-income ratios. MC borrowers experienced higher rates of foreclosure and delinquency during the crisis. Our results imply that the regulation in place had the capacity to prevent the deterioration of lending standards widely blamed for the crisis. The inconsistent enforcement of regulation, though, eroded its effectiveness. Higher involvement of mortgage companies in subprime lending and securitization activity do not explain our results. |
| Keywords: | Banks and banking ; Mortgages ; Foreclosure ; Regulation ; Regulation |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedcwp:1220&r=ure |
| By: | Pavlyuk, Dmitry |
| Abstract: | During the last two decades the European airport industry is liberalised and turned to competitive market environment. This fact attracts an increasing scientific and practical interest to analysis of airport efficiency and its determinants, as well as different aspects of airport competition. This paper contains a critical review of existing researches in these two areas – airport efficiency and spatial competition among airports. We analysed modern approaches to airport benchmarking, their advantages and shortcomings, and systematised a wide range of related academic studies. We paid special attention to empirical researches of spatial competition as a factor affecting airport efficiency. Despite the fact of a well-developed theory of spatial competition and signs of its growing effects in the airport industry, we discovered a lack of studies devoted to the relationship between airport efficiency and spatial competition. |
| Keywords: | airport efficiency; benchmarking; spatial competition |
| JEL: | L93 D24 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:43391&r=ure |
| By: | Saleh, Mohamed (TSE,IAST) |
| Abstract: | I examine the impact of the transformation of elementary religious schools (kuttabs) into modern primary schools in 1953-56 on the educational and occupational differentials between religious groups in Egypt. Before the reform, non-Muslims enjoyed better educational and occupational outcomes than the Muslim majority and, unlike Muslims, were almost all enrolled in modern schools. Using several new data sources, the individual-level census sample from 1996, the official schooling reports from 1907 to 1969, and the village/urban quarter-level census data from 1897 to 1986, I find that the inter-religious educational and occupational gaps both declined in the second half of the twentieth century. The educational reform seems to explain the reduction in the occupational gap, but cannot explain the decline of the educational gap. |
| Keywords: | educational modernization; religious schools; Middle Eastern economic history; human capital; modern schools |
| JEL: | I N35 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:26115&r=ure |
| By: | Badi H. Baltagi (Center for Policy Research, Maxwell School, Syracuse University, 426 Eggers Hall, Syracuse, NY 13244-1020); Bernard Fingleton (University of Cambridge); Alain Pirotte (Université Panthéon-Assas Paris II) |
| Abstract: | This paper focuses on the estimation and predictive performance of several estimators for the dynamic and autoregressive spatial lag panel data model with spatially correlated disturbances. In the spirit of Arellano and Bond (1991) and Mutl (2006), a dynamic spatial GMM estimator is proposed based on Kapoor, Kelejian and Prucha (2007) for the Spatial AutoRegressive (SAR) error model. The main idea is to mix non-spatial and spatial instruments to obtain consistent estimates of the parameters. Then, a linear predictor of this spatial dynamic model is derived. Using Monte Carlo simulations, we compare the performance of the GMM spatial estimator to that of spatial and non-spatial estimators and illustrate our approach with an application to new economic geography. Key Words: Forecasting, Spatial Correlation, Panel Data, Dynamic Models JEL No. C33 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:max:cprwps:149&r=ure |
| By: | TOKUNAGA Suminori; KAGEYAMA Masahiro; AKUNE Yuko; NAKAMURA Ryohei |
| Abstract: | For Japan's assembly-type manufacturing industry which is composed of general machinery, electrical machinery, equipment and suppliers, and transportation equipment for 1985-2000, we estimate flexible translog production function based on Kim (1992) and Tokunaga and Kageyama (2008) using four-digit standard industrial classification (SIC) industry panel data and Ellison and Glaeser's (1997) agglomeration and co-agglomeration indices (with different industry groups) panel data, and obtain theoretically appropriate and significant results without the homotheticity restriction. From these results, we find evidence of positive and weak agglomeration economies on production in Japanese assembly-type manufacturing industry for 1985-2000. |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:12082&r=ure |
| By: | Gelain, Paolo; Lansing, Kevin J.; Mendicino, Caterina |
| Abstract: | Progress on the question of whether policymakers should respond directly to financial variables requires a realistic economic model that captures the links between asset prices, credit expansion, and real economic activity. Standard DSGE models with fully-rational expectations have difficulty producing large swings in house prices and household debt that resemble the patterns observed in many developed countries over the past decade. We introduce excess volatility into an otherwise standard DSGE model by allowing a fraction of households to depart from fully-rational expectations. Specifically, we show that the introduction of simple moving-average forecast rules for a subset of households can significantly magnify the volatility and persistence of house prices and household debt relative to otherwise similar model with fully-rational expectations. We evaluate various policy actions that might be used to dampen the resulting excess volatility, including a direct response to house price growth or credit growth in the central bank’s interest rate rule, the imposition of more restrictive loan-to-value ratios, and the use of a modified collateral constraint that takes into account the borrower’s loan-to-income ratio. Of these, we find that a loan-to-income constraint is the most effective tool for dampening overall excess volatility in the model economy. We find that while an interest-rate response to house price growth or credit growth can stabilize some economic variables, it can significantly magnify the volatility of others, particularly inflation. |
| Keywords: | asset pricing; excess volatility; credit cycles; housing bubbles; monetary policy; macroprudential policy |
| JEL: | E32 E44 G12 O40 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpm:dynare:021&r=ure |
| By: | Badi H. Baltagi (Center for Policy Research, Maxwell School, Syracuse University, 426 Eggers Hall, Syracuse, NY 13244-1020); Long Liu (The University of Texas at San Antonio) |
| Abstract: | This paper obtains the joint and conditional Lagrange Multiplier tests for a spatial lag regression model with spatial auto-regressive error derived in Anselin et al. (1996) using artificial Double Length Regressions (DLR). These DLR tests and their corresponding LM tests are compared using an illustrative example and a Monte Carlo simulation. Key Words: Double Length Regression; Spatial Lag Dependence; Spatial Error Dependence; Artificial Regressions JEL No. C12, C21, R15 |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:max:cprwps:147&r=ure |
| By: | Anna Golejewska (Faculty of Economics, University of Gdansk); Damian Gajda (Faculty of Management, University of Gdansk) |
| Abstract: | The paper relates to factors determining regional competitiveness in Poland. The aim of the empirical analysis is to compare competitive ability of regions in Poland (NUTS-2 level) in 2001-2010 and to verify the existence of clusters. It is based on two data sources: Eurostat Regional Statistics and Local Data Bank (The Central Statistical Office). Polish regions differ essentially in historical, geographical, economic and social dimension. The cluster analysis comprises seven idicators: patent applications to the EPO, share of core Human Resources in Science and Technology, R&D expenditure, share in lifelong learning, share of population with tertiary education, longterm unemployment rate and employment in sectors J and K. We apply two classical methods of cluster analysis: hierarchical Ward’s method and non-hierarchical k-means clustering algorithm. The results confirm substantial diversity of competitive potential of Polish regions and its changes in the analysed period, as well as ambiguous influence of chosen determinants on competitive positions of particular regions. Further research is still needed. |
| Keywords: | regional competitiveness, Poland, cluster analysis |
| JEL: | R11 P25 C38 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:gda:wpaper:1205&r=ure |
| By: | Pastore, Francesco (University of Naples II); Tyrowicz, Joanna (Warsaw University) |
| Abstract: | This paper aims to study whether the local variation in unemployment rates is related to labour turnover and what is the sign of such relationship. In addition, the paper aims to assess the relative impact of inflow and outflow from unemployment on the dynamics of the local unemployment rate. The empirical analysis is based on a newly available unique dataset from the employment registry of a transition economy (Poland), encompassing nine years of monthly data (from 2000 to 2008) at a county (poviat) level. We find that turnover, as well as inflows and outflows separately, are ceteris paribus positively related to the unemployment level. This general conclusion is robust to sub-sampling that addresses potential heterogeneity of the analysed local labour markets. It is also robust to the use of different panel estimators as well as for spatial clustering of poviats. We also find that elasticity is larger in the case of the inflow rate than for the outflow rate. Finally, we demonstrate that the effect is stronger in low unemployment regions. |
| Keywords: | regional unemployment, labour turnover, panel data, Poland |
| JEL: | C33 J63 P25 P52 R23 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7074&r=ure |
| By: | Nicholas J. Sanders (Department of Economics, The College of William and Mary) |
| Abstract: | In 1998, a number of polluting industries, including fossil fuel power plants, were added to the list of firms publicly reporting pollution releases in the Toxics Release Inventory (TRI). This caused a large increase in reported toxic pollution, and a corresponding decrease in median housing prices of 2-3 percent in impacted areas. Contrary to prior findings that TRI information does not influence household actions, I find the additional TRI data caused households to revise priors on ambient pollution levels. This implies that, even with market-based environmental regulation, there remains a role for government as provider of information on environmental conditions. |
| Keywords: | pollution, hedonic estimation, Toxics Release Inventory |
| JEL: | D62 H23 Q50 Q53 |
| Date: | 2012–12–11 |
| URL: | http://d.repec.org/n?u=RePEc:cwm:wpaper:128&r=ure |
| By: | Andreas Fuster; Paul S. Willen |
| Abstract: | Surprisingly little is known about the importance of mortgage payment size for default, as efforts to measure the treatment effect of rate increases or loan modifications are confounded by borrower selection. We study a sample of hybrid adjustable-rate mortgages that have experienced large rate reductions over the past years and are largely immune to these selection concerns. We show that interest rate changes dramatically affect repayment behavior. Our estimates imply that cutting a borrower’s payment in half reduces his hazard of becoming delinquent by about two-thirds, an effect that is approximately equivalent to lowering the borrower’s combined loan-to-value ratio from 145 to 95 (holding the payment fixed). These findings shed light on the driving forces behind default behavior and have important implications for public policy. |
| Keywords: | Mortgage loans ; Adjustable rate mortgages ; Default (Finance) |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbpp:12-10&r=ure |
| By: | Philip Bond; Ronel Elul; Sharon Garyn-Tal; David K. Musto |
| Abstract: | Refinancing a first mortgage puts legal principles in conflict when other, junior, liens also exist. On one hand, the principle that seniority follows time priority leaves the new refinancing mortgage junior to mortgages that were junior to the original, refinanced first mortgage. On the other hand, the principle of equitable subrogation gives the refinancing mortgage the seniority of the claim it paid down. States resolve this tension differently, thus differentiating how much a second mortgage impedes refinancing of the first. We exploit this cross-state variation to identify the impact on mortgage refinancing and find that refinancing is significantly more likely in the states following the principle of equitable subrogation when the homeowner also has a second mortgage. |
| Keywords: | Mortgage loans ; Mortgages |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpwp:13-3&r=ure |
| By: | Hultkrantz, Lars (Department of Business, Economics, Statistics and Informatics); Krüger, Niclas (Swedish National Road and Transport Institute); Mantalos , Panagiotis (Department of Business, Economics, Statistics and Informatics) |
| Abstract: | We modify a method recently suggested by Martin Weitzman (2012) for determining a risk-adjusted social discount rate (SDR) term structure consistent with both the (augmented) Ramsey rule and the consumption-based CAPM. Using this approach we estimate SDR for transportation infrastructure investments based on an analysis of correlations between transportation work, split on road and rail, and passenger travel and freight transport, and GDP in Sweden 1950-2011. We show that this can be estimated from two time-series following a random walk with drift, even if they are not co-integrated. Based on current estimates of the risk-free rate and the equity risk premium, we estimate the relevant SDR to be 5-6 percent, possibly somewhat lower for investment in railroads for passenger travel, and only slowly declining within the investment horizon. This is higher than the current rates used in, for instance, Sweden, Germany and the UK. |
| Keywords: | Ramsey rule; CAPM; cost-benefit |
| JEL: | D61 H43 L91 |
| Date: | 2012–12–18 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oruesi:2012_014&r=ure |
| By: | Various Authors |
| Keywords: | National School Lunch and School Breakfast Programs, American Community Survey Data, Nutrition |
| JEL: | I0 I1 |
| Date: | 2012–12–30 |
| URL: | http://d.repec.org/n?u=RePEc:mpr:mprres:7618&r=ure |
| By: | Badi H. Baltagi (Center for Policy Research, Maxwell School, Syracuse University, 426 Eggers Hall, Syracuse, NY 13244-1020); Zhenlin Yang (Singapore Management University) |
| Abstract: | The robustness of the LM tests for spatial error dependence of Burridge (1980) and Born and Breitung (2011) for the linear regression model, and Anselin (1988) and Debarsy and Ertur (2010) for the panel regression model with random or fixed effects are examined. While all tests are asymptotically robust against distributional misspecification, their finite sample behavior may be sensitive to the spatial layout. To overcome this shortcoming, standardized LM tests are suggested. Monte Carlo results show that the new tests possess good finite sample properties. An important observation made throughout this study is that the LM tests for spatial dependence need to be both mean- and variance-adjusted for good finite sample performance to be achieved. The former is, however, often neglected in the literature. Key Words: Bootstrap; Distributional misspecification; Group interaction; LM test; Moran’s I Test; Robustness; Spatial layout; Spatial panel models JEL No. C21, C23, C5 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:max:cprwps:142&r=ure |
| By: | Gunnar Pippel |
| Abstract: | Innovation is the result of an interactive process. Knowledge-intensive interactions among different partners are associated with a variety of advantages and disadvantages for the actors involved. Therefore, a rich body of literature investigating the impact of R&D collaboration networks on the innovation performance of firms and regions has developed over the last two decades. Those studies come to different results. The aims of this paper are manifold. First, the paper summarizes the results of the relevant literature. Second, a brief overview of the established methods and approaches used in the literature to investigate this research question is given. The third objective is to answer the question whether the achieved results in the literature are predetermined by the employed methods. Finally, relevant gaps for further research are identified. To answer these questions a meta-analysis of the relevant literature is conducted. This study shows that knowledge-intensive interactions have a rather positive impact on the performance of firms and regions. There is also evidence that the employed methods and approaches used in the literature to investigate this research question predetermine the outcome of the research. |
| Keywords: | innovation, collaboration, network, performance, meta-analysis |
| JEL: | O32 O33 R10 R11 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:iwh:dispap:14-12&r=ure |
| By: | Daniel Wilson (Federal Reserve Bank of San Francisco); Sylvain Leduc (Federal Reserve Bank of San Francisco) |
| Abstract: | We examine the dynamic macroeconomic effects of public infrastructure investment both theoretically and empirically, using a novel data set we compiled on various highway spending measures. Relying on the institutional design of federal grant distributions among states, we construct a measure of government highway spending shocks that captures revisions in expectations about future government investment. We find that shocks to federal highway funding has a positive effect on local GDP both on impact and after 6 to 8 years, with the impact effect coming from shocks during (local) recessions. The direct channel appears to stem from federal grants leading to increased state government spending, and we provide strong evidence of this "flypaper effect." |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed012:210&r=ure |
| By: | Quinn Moore; Kevin Conway; Brandon Kyler |
| Keywords: | NSLP, National School Lunch Program, Direct Certification, State Implementation |
| JEL: | I0 I1 |
| Date: | 2012–10–30 |
| URL: | http://d.repec.org/n?u=RePEc:mpr:mprres:7615&r=ure |
| By: | Liu, Shuangzhe (University of Canberra, Canberra, Australia); Ma, Tiefeng (Statistics College, Southwestern University of Finance and Economics, Chengdu, China); Polasek, Wolfgang (Department of Economics and Finance, Institute for Advanced Studies, Vienna, Austria) |
| Abstract: | System of panel models are popular models in applied sciences and the question of spatial errors has created the recent demand for spatial system estimation of panel models. Therefore we propose new diagnostic methods to explore if the spatial component will change significantly the outcome of non-spatial estimates of seemingly unrelated regression (SUR) systems. We apply a local sensitivity approach to study the behavior of generalized least squares (GLS) estimators in two spatial autoregression SUR system models: a SAR model with SUR errors (SAR-SUR) and a SUR model with spatial errors (SUR-SEM). Using matrix derivative calculus we establish a sensitivity matrix for spatial panel models and we show how a first order Taylor approximation of the GLS estimators can be used to approximate the GLS estimators in spatial SUR models. In a simulation study we demonstrate the good quality of our approximation results. |
| Keywords: | Seemingly unrelated regression models, panel systems with spatial errors, SAR and SEM models, generalized least-squares estimators, Taylor approximations |
| JEL: | G14 G15 C22 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:ihs:ihsesp:294&r=ure |
| By: | D. Mark Anderson; Resul Cesur; Erdal Tekin |
| Abstract: | While the contemporaneous association between mental health problems and criminal behavior has been explored in the literature, the long-term consequences of such problems, depression in particular, have received much less attention. Using data from the National Longitudinal Study of Adolescent Health, we examine the effect of depression during adolescence on the probability of engaging in a number of criminal behaviors later in life. In our analysis, we control for a rich set of individual, family, and neighborhood level factors to account for conditions that may be correlated with both childhood depression and adult criminality. One novelty in our approach is the estimation of school and sibling fixed effects models to account for unobserved heterogeneity at the neighborhood and family levels. Furthermore, we exploit the longitudinal nature of our data set to account for baseline differences in criminal behavior. We find little evidence that adolescent depression predicts the likelihood of engaging in violent crime or the selling of illicit drugs. However, our empirical estimates show that adolescents who suffer from depression face an increased probability of engaging in property crime. Our estimates imply that the lower-bound economic cost of property crime associated with adolescent depression is about 219 million dollars annually. |
| JEL: | I10 K42 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18656&r=ure |
| By: | Börjesson, Maria (KTH); Eliasson, Jonas (KTH); Lundberg, Mattias |
| Abstract: | Cost-benefit analysis (CBA) is often used when many transport investments need to be ranked against each other, for example in national investment planning. However, results are often questioned on claims that the ranking depends crucially on uncertain assumptions about the future, and on methodologically or ethically contestable trade-offs of different types of benefits relative to each other. This paper explores the robustness of CBA rankings of transport investments with respect to two types of uncertainties: relative benefit valuations and scenario assumptions related to car ownership, characteristics and costs. The study is based on CBAs of 479 suggested road and rail investments in Sweden that have been shortlisted for possible inclusion in the national transport investment plan. The CBA ranking turns out to be robust to variations in the studied scenario assumptions. The CBA ranking also turns out to be robust to changes in the relative valuations of different types of benefits – person travel time savings, traffic safety, emissions and freight benefits. We also compare two sets of travel time valuations against each other, one of which differentiated with respect to mode and travel purpose and one which is not, again concluding that the investment ranking is robust. |
| Keywords: | Cost benefit analysis; Appraisal; Robustness; Decision support. |
| JEL: | R41 R48 |
| Date: | 2012–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ctswps:2012_030&r=ure |
| By: | Badi H. Baltagi (Center for Policy Research, Maxwell School, Syracuse University, 426 Eggers Hall, Syracuse, NY 13244-1020); Peter H. Egger (Centre for Economic Policy Research (CEPR); London, United Kingdom); Michaela Kesina (ETH Zurich) |
| Abstract: | This paper considers a Hausman and Taylor (1981) panel data model that exhibits a Cliff and Ord (1973) spatial error structure. We analyze the small sample properties of a generalized moments estimation approach for that model. This spatial Hausman-Taylor estimator allows for endogeneity of the time-varying and time-invariant variables with the individual effects. For this model, the spatial effects estimator is known to be consistent, but its disadvantage is that it wipes out the effects of time-invariant variables, which are important for most empirical studies. Monte Carlo results show that the spatial Hausman-Taylor estimator performs well in small samples. Key Words: Hausman-Taylor estimator; Spatial random effects; Small sample properties JEL No. C23, 31 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:max:cprwps:141&r=ure |
| By: | Jaideep Gupte (Institute of Development Studies, University of Sussex); Patricia Justino (Institute of Development Studies, University of Sussex); Jean-Pierre Tranchant (Institute of Development Studies, University of Sussex) |
| Abstract: | The objective of this paper is to uncover the determinants of riot victimization in India. The analysis is based on a unique survey collected by the authors in March-May 2010 in Maharashtra. We adopt a multilevel framework that allows neighborhood and district effects to randomly influence household victimization. The main results are that households that (i) are economically vulnerable, (ii) live in the vicinity of a crime-prone area, and (iii) are not able to rely on community support are considerably more prone to suffer from riots than other households. All else equal, income per capita increases victimization, presumably through an opportunity cost mechanism. We find further that relatively affluent neighborhoods and those characterized by large caste fragmentation are more riot-prone than disfranchised and homogeneous ones. Victimization is more common in neighborhoods with weaker social interactions, but some evidence suggests that weak social interactions may also be a consequence of rioting. |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:hic:wpaper:126&r=ure |
| By: | Jaison R. Abel; Richard Deitz |
| Abstract: | We study one potential source of urban agglomeration economies: better job matching. Focusing on college graduates, we construct two direct measures of job matching based on how well an individual’s job corresponds to his or her college education. Consistent with matching-based theories of urban agglomeration, we find evidence that larger and thicker local labor markets help college graduates find better jobs by increasing both the likelihood and quality of a match. We then assess the extent to which better job matching of college-educated workers increases individual-level wages and thereby contributes to the urban wage premium. While we find that college graduates with better job matches do indeed earn higher wages on average, the contribution of such job matching to aggregate urban productivity appears to be relatively modest. |
| Keywords: | Wages ; Productivity ; Employment ; College graduates ; Labor market ; Urban economics |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednsr:587&r=ure |
| By: | Stephan Kampelmann; François Rycx |
| Abstract: | We provide first evidence regarding the direct impact of educational mismatch on firm productivity. To do so, we rely on representative linked employer-employee panel data for Belgium covering the period 1999-2006. Controlling for simultaneity issues, time-invariant unobserved workplace characteristics, cohort effects and dynamics in the adjustment process of productivity, we find that: i) a higher level of required education exerts a significantly positive influence on firm productivity, ii) additional years of over-education (both among young and older workers) are beneficial for firm productivity, and iii) additional years of under-education (among young workers) are detrimental for firm productivity. |
| Keywords: | Educational mismatch; Productivity; Linked panel data; GMM |
| JEL: | I21 J24 |
| Date: | 2012–12–19 |
| URL: | http://d.repec.org/n?u=RePEc:sol:wpaper:2013/135592&r=ure |
| By: | Anna Golejewska (Faculty of Economics, University of Gdansk) |
| Abstract: | Accumulation of human capital is one of the major determinants of economic growth. In the last decades, theoretical and empirical literature has analysed this issue at regional level, providing interesting results. The analysis focuses on 35 regions of the Visegrad Group (NUTS-2 level) in 2002-2009 and is based on Eurostat Regional Statistics. The objective of it was to compare competitiveness and human capital intensity in the Visegrad Group regions, verify the existence of correlation and thus potential human capital growth effects. The analysis comprised two groups of indicators: measures of competitive position and human capital education indicators, as measures of competitive ability. The results showed that there have been and continue to be substantial differences among the regions as regards competitiveness and human capital. This paper has contributed to confirming the positive link between education and regional competitiveness in the selected group of countries, however further research is still needed. |
| Keywords: | regional competitiveness, human capital, Central and Eastern European Countries |
| JEL: | R11 J24 P25 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:gda:wpaper:1204&r=ure |
| By: | Tom Engsted (Aarhus University and CREATES); Thomas Q. Pedersen (Aarhus University and CREATES) |
| Abstract: | We investigate the predictive power of the rent-to-price ratio for future real estate returns and rent growth in 18 OECD countries over the period 1970 to 2011. First, we document that in most countries returns are signi?cantly predictable by the rent-price ratio. An increase (decrease) in the ratio signals a future increase (decrease) in returns. Second, there are large cross-country di¤erences in how the rent-price ratio predicts rent growth. For some countries the direction of predictability is negative, for other countries it is positive. Third, the predictive patterns are highly dependent on whether returns and rents are measured in nominal or real terms. Finally, there is some evidence of sub-sample instability in the predictive patterns, especially wrt. rent growth predictability. The predictability tests are conducted within a restricted VAR framework based on the dynamic Gordon growth model. This model implies restrictions across the VAR parameters that can be used to construct powerful tests of predictability. |
| Keywords: | Real estate predictability, dynamic Gordon growth model, rent-price ratio, VAR model, OECD countries |
| JEL: | C32 G12 R31 |
| Date: | 2012–12–17 |
| URL: | http://d.repec.org/n?u=RePEc:aah:create:2012-58&r=ure |
| By: | Lahno, Amrei M.; Serra-Garcia, Marta |
| Abstract: | This paper examines the effect of peers on individual risk taking. In the absence of informational motives, we investigate why social utility concerns may drive peer effects. We test for two main channels: utility from payoff differences and from conforming to the peer. We show experimentally that social utility generates substantial peer effects in risk taking. These are mainly explained by utility from payoff differences, in line with outcomebased social preferences. Contrary to standard assumptions, we show that estimated social preference parameters change significantly when peers make active choices, compared to when lotteries are randomly assigned to them. |
| Keywords: | Peer Effects; Decision Making under risk; Social Comparison; Social Preferences; Laboratory Experiment |
| JEL: | C91 C92 D03 D83 |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:lmu:muenec:14309&r=ure |
| By: | Greg Kaplan (Department of Economics, Princeton University); Guido Menzio (Department of Economics, University of Pennsylvania) |
| Abstract: | We propose a novel theory of self-fulfilling fluctuations in the labor market. A firm employing an additional worker generates positive externalities on other firms, because employed workers have more income to spend and have less time to shop for low prices than unemployed workers. We quantify these shopping externalities and show that they are sufficiently strong to create strategic complementarities in the employment decisions of different firms and to generate multiple rational expectations equilibria. Equilibria differ with respect to the agents’ (rational) expectations about future unemployment. We show that negative shocks to agents’ expectations lead to fluctuations in vacancies, unemployment, labor productivity and the stock market that closely resemble those observed in the US during the Great Recession. |
| Keywords: | Self-fulfilling fluctuations, strategic complementarity, unemployment |
| JEL: | D11 D21 D43 E32 |
| Date: | 2012–12–12 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:12-048&r=ure |
| By: | Mitsuhiro Hayashi; Mitsuhiko Kataoka; Takahiro Akita |
| Abstract: | Based on 2008-2010 Susenas panel data, this study analyzes expenditure inequality in Indonesia from spatial perspectives by using several inequality decomposition methods: decomposition of the Theil indices by population subgroups; decomposition of the Gini coefficient by expenditure components; and the Blinder-Oaxaca decomposition. In the Theil decomposition, this study employs not only the conventional approach but also an alternative approach proposed by Elbers and others (2008). Our results show that a substantial portion of expenditure inequality is attributed to inequalities within urban and rural sectors. According to the alternative approach, however, the contribution of between-sector inequality increases conspicuously, suggesting that there are notable differences in the distribution of per capita household expenditures between the urban and rural sectors. Educational differences appear to have played an important role in urban inequality as well as urban-rural disparity. For both urban and rural households, expenditures on non-food items, including expenditure on education, serve to have increased total inequality. |
| Keywords: | Indonesia, spatial inequality, decomposition of Theil indices and Gini coefficient, Blinder |
| Date: | 2012–12 |
| URL: | http://d.repec.org/n?u=RePEc:een:crwfrp:1211&r=ure |
| By: | Alem, Yonas (Department of Economics, School of Business, Economics and Law, Göteborg University); Köhlin, Gunnar (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | Most studies of subjective well-being in developing countries use cross-sectional data, which makes it difficult to control for unobserved individual heterogeneity. In this paper, we use three rounds of panel data and robust non-linear panel data models to investigate the trends and determinants of life satisfaction in urban Ethiopia. Although Ethiopia exhibited rapid economic growth during the analyzed period, the average reported level of life satisfaction declined. Regression results show that despite the significant difference between urban Ethiopia and industrialized countries in terms of economic and social conditions, many of the determinants of life satisfaction are similar. This includes, age, marital status, health, unemployment, economic status, relative position and educational achievement. Our results also indicate that both individual (respondent) and household level versions of these variables are important determinants of life satisfaction. This provides some evidence on the interdependence of individual and household subjective well-being in developing countries. The fact that rapid economic growth was accompanied by a decline in citizens’ average reported level of life satisfaction brings the pro-poorness of the recent economic growth in Ethiopia into question. We argue that economic growth that trickles down to the poor and ensures creation of stable jobs would be welfare enhancing.<p> |
| Keywords: | Life Satisfaction; Urban Ethiopia; Economic Growth; Correlated Random-Effects Ordered Probit. |
| JEL: | C25 D60 I31 |
| Date: | 2012–12–19 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0548&r=ure |
| By: | Hultkrantz, Lars (Department of Business, Economics, Statistics and Informatics) |
| Abstract: | High-Speed Rail (HSR) is designed for travelers with high value of time. HSR offer fast and reliable services and good possibilities for work during the journey. Surprisingly, these benefits of HSR investment proposals are often appraised by use of travel-time valuations of people who use conventional (intercity) train services. The standard approach builds on two major assumptions, linearity of demand, and that the value of time is unchanged between the “before” and “after” alternatives, i.e., that change in the average value of time of passengers can be ignored. While the first of these is well known, the second is not always observed. However, the spread of values of time between individual travelers is large and is an essential motivation for HSR investments. This note therefore considers whether the assumption that the value of time remains unchanged by the speed improvement induces any significant bias in the appraisal. We first use a modal-mix model where travelers have varying value of time to outline some conceptual points and then discuss to what extent these may affect the social profitability of three recently constructed or proposed HSR lines: Oslo- Stockholm (Norway and Sweden), Stockholm-Göteborg (Sweden) and Beijing-Shanghai Hongqiao (China). We conclude that a RoHbased evaluation of an HSR line should be complemented by a sensitivity analysis of how the outcome is affected by possible changes of the composition of travelers with different values of time. |
| Keywords: | Cost-benefit analysis; rule-of-a-half; high-speed rail |
| JEL: | D61 H43 L92 |
| Date: | 2012–12–06 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oruesi:2012_013&r=ure |