nep-ure New Economics Papers
on Urban and Real Estate Economics
Issue of 2016‒06‒04
24 papers chosen by
Steve Ross
University of Connecticut

  1. Zone Pricing in Theory and Practice By Daganzo, Carlos F; Lehe, Lewis
  2. Modelling and Forecasting Mortgage Delinquency and Foreclosure in the UK. By Janine Aron; John Muellbauer
  3. Who Bears the Cost of Recessions? The Role of House Prices and Household Debt By Atif Mian; Amir Sufi
  4. When Internet became Geography. Spatial patterns on urban open spaces through the analysis of user-generated data in Barcelona By Masala, Elena; Montserrat Pallares-Barbera
  5. Potential Greenhouse Gas Emission Reductions from Optimizing Urban Transit Networks By Madanat, Samer; Horvath , Arpad; Mao, Chao; Cheng, Han
  6. The Economics of "Radiator Springs:" Industry Dynamics, Sunk Costs, and Spatial Demand Shifts By Jeffrey R. Campbell; Thomas Hubbard
  7. When Bubble Meets Bubble: Contagion in OECD Countries By Jose Eduardo Gomez-Gonzalez; Juliana Gamboa-Arbeláez; Jorge Hirs-Garzón; Andrés Pinchao-Rosero
  8. Cross-Generational Differences in Educational Outcomes in the Second Great Wave of Immigration By Umut Özek; David N. Figlio
  9. Matching and credit frictions in the housing market By Eerola, Essi; Määttänen, Niku
  10. Local Government Proliferation, Diversity, and Conflict By Samuel Bazzi; Matthew Gudgeon
  11. Parents, Schools and Human Capital Differences across Countries By Marta De Philippis; Federico Rossi
  12. Social Promotion in Primary School: Immediate and Cumulated Effects on Attainment By Leighton, Margaret; Souza, Priscila; Straub, Stéphane
  13. Hedonic Analysis and Time Varying Amenities: An Application Using School Quality By Tra, Constant; Towe, Charles
  14. The Global Spatial Distribution of Economic Activity: Nature, History and the Role of Trade By J. Vernon Henderson; Tim Squires; Adam Storeygard; David Weil
  15. The Economic Implications of Social Capital on Hispanic Entrepreneurship By Torres, Ariana; Marshall, Maria; Delgado, Michael
  16. The cultural diffusion of the fertility transition: evidence from internal migration in 19 th century France By Guillaume Daudin; Raphaël Franck; Hillel Rapoport
  17. Adaptation of Rural Migrant Workers in Cities of Intensive Urbanization: Case of Makhachkala By Kazenin, Konstantin Igorevich
  18. Distribution Free Estimation of Spatial Autoregressive Binary Choice Panel Data Models By T. Arduini
  19. Charter High Schools' Effects on Long-Term Attainment and Earnings (Journal Article) By Tim R. Sass; Ron W. Zimmer; Brian P. Gill; Kevin T. Booker
  21. Neighborhood Effects in Pesticide Use : Evidence from the Rural Philippines By Takeshi Aida
  22. "Too small to farm, too big to mow”: The impact of large-lot zoning on the exurban landscape By Gottlieb, Paul D.; Lubeck, Meggan; Marxen, Lucas
  23. Cities export specialization By Díaz-Lanchas, Jorge; Llano, Carlos; Minondo, Asier; Requena, Francisco
  24. When do peers matter?: A cross-country perspective By Francis, Bill B.; Hasan, Iftekhar; Kostova, Gergana L.

  1. By: Daganzo, Carlos F; Lehe, Lewis
    Abstract: Amid growing recognition of the costs of downtown congestion and scarcity of revenues for new roads, congestion pricing for downtown areas -- a practice we call “zone pricing†-- has begun to receive wide attention. From 1975-2003, zone pricing failed to spread beyond Singapore, but by the 2000’s technological advances had made the practice more widely practical. Now London, Stockholm, Milan and Gothenburg have schemes of their own, and zone pricing is on the agenda in many world cities. The research summarized in this report has sought to advance practical knowledge of zone pricing in several ways. First, we have created a very detailed, scholarly history of zone pricing, covering the circumstances under which cities have implemented zone pricing, what technologies have been used and what results these cities have obtained. Second, we investigated the theory of “usage tolls.†A drawback of all tradition zone pricing systems is that, for practical reasons, they fail to charge different tolls to drivers who use the network to different degrees: someone who enters the downtown and immediately parks pays the same toll as someone who circles for an hour. But with new technology it will be possible to charge drivers for some index of road use, such as how far or how long they travel inside the network. Our research highlights two major advantages of usage tolling: (i) it can reschedule trips in optimal ways; (ii) it can discourage long trips -- such as those traveling across the downtown between points outside -- from happening by car in the first place. In both cases, an interesting result is the added precision of usage tolls means congestion reduction can be accomplished while charging drivers relatively little. We cite this as a political advantage that will help make zone pricing more palatable.
    Keywords: Engineering, congestion, pricing, zone pricing, tolls, economics
    Date: 2016–04–12
  2. By: Janine Aron; John Muellbauer
    Abstract: Abstract: In the absence of micro-data in the public domain, new aggregate models for the UK’s mortgage repossessions and arrears are estimated using quarterly data over 1983-2014, motivated by a conceptual double trigger frame framework for foreclosures and payment delinquencies. An innovation to improve on the flawed but widespread use of loan-to-value measures, is to estimate difficult-to-observe variations in loan quality and access to refinancing, and shifts in lenders’ forbearance policy, by common latent variables in a system of equations for arrears and repossessions. We introduce, for the first time in the literature, a theory-justified estimate of the proportion of mortgages in negative equity as a key driver of aggregate repossessions and arrears. This is based on an average debt-equity ratio, corrected for regional deviations, and uses a functional form for the distribution of the debt-equity ratio checked on Irish micro-data from the Bank of Ireland, and Bank of England snapshots of negative equity. We systematically address serious measurement bias in the ‘months-in-arrears’ measures, neglected in previous UK studies. Highly significant effects on aggregate rates of repossessions and arrears are found for the aggregate debt-service ratio, the proportion of mortgages in negative equity and the unemployment rate. Economic forecast scenarios to 2020 highlight risks faced by the UK and its mortgage lenders, illustrating the usefulness of the approach for bank stress-testing. For macroeconomics, our model traces an important part of the financial accelerator: the feedback from the housing market to bad loans and hence banks’ ability to extend credit.
    Keywords: foreclosures, mortgage repossessions, mortgage payment delinquencies, mortgage arrears, credit risk stress testing, latent variables model.
    JEL: G21 G28 G17 R28 R21 C51 C53 E27
    Date: 2016–04–11
  3. By: Atif Mian; Amir Sufi
    Abstract: This chapter reviews empirical estimates of differential income and consumption growth across individuals during recessions. Most existing studies examine the variation in income and consumption growth across individuals by sorting on ex ante or contemporaneous income or consumption levels. We build on this literature by showing that differential shocks to household net worth coming from elevated household debt and the collapse in house prices play an underappreciated role. Using zip codes in the United States as the unit of analysis, we show that the decline in numerous measures of consumption during the Great Recession was much larger in zip codes that experienced a sharp decline in housing net worth. In the years prior to the recession, these same zip codes saw high house price growth, a substantial expansion of debt by homeowners, and high consumption growth. We discuss what models seem most consistent with this striking pattern in the data, and we highlight the increasing body of macroeconomic evidence on the link between household debt and business cycles. Our main conclusion is that housing and household debt should play a larger role in models exploring the importance of household heterogeneity on macroeconomic outcomes and policies.
    JEL: E21 E32 E44 E51
    Date: 2016–05
  4. By: Masala, Elena; Montserrat Pallares-Barbera
    Abstract: The main objective that motivates the paper concerns the study on user-generated data (UGD) for exploring new methodologies that could support and improve the understanding of spatial patterns for urban planning and design of open spaces in urban areas. This paper aims at taking a step forward from current literature, providing on the one hand a method for social science analysis and, on the other hand, expecting to motivate the possible outcomes of user-generated data coming from two ICT platforms into policy driving strategies in order to improve quality of life. In order to do so, this paper examines UGD coming from social network platforms and apps to provide a visual and scientific exploration of the resulting spatial pattern, specifically of locals, visitors and tourists which have used two urban open spaces (UOS) in Barcelona, Enric Granados Street and Forum. In addition, for the purpose of analysis, the spatial patterns have been discriminated by language to study the further insides of how diverse groups of population construct different spatial patterns given by their preferences in visiting a city. Keywords - Big Data, Mapping, Twitter, Urban Open Spaces.
    Date: 2016–04
  5. By: Madanat, Samer; Horvath , Arpad; Mao, Chao; Cheng, Han
    Abstract: Public transit systems with efficient designs and operating plans can reduce greenhouse gas (GHG) emissions relative to low-occupancy transportation modes, but many current transit systems have not been designed to reduce environmental impacts. This motivates the study of the benefits of design and operational approaches for reducing the environmental impacts of transit systems. For example, transit agencies may replace level-of-service (LOS) by vehicle miles traveled (VMT) as a criterion in evaluating design and operational changes. Previous studies have demonstrated in an idealized singletechnology transit system the potential of reducing GHG emissions by lowering the transit level-of-service (LOS) provided to the users. In this research, we extend the analysis to account for a more realistic case: a transit system with a hierarchical structure (trunk and feeder lines) providing service to a city where demand is elastic. By considering the interactions between the trunk and the feeder systems, the study provides a quantitative basis for designing and operating integrated urban transit systems that can reduce GHG emissions and costs to both transit users and agencies. The study shows that highly elastic transit demand may cancel emission reduction potentials resulting from lowering LOS, due to demand shifts to lower occupancy vehicles, causing unintended consequences. However, for mass transit modes, these potentials are still significant. Transit networks with buses, bus rapid transit or light rail as trunk modes should be designed and operated near the cost-optimal point when the demand is highly elastic, while this is not required for metro. We also find that the potential for unintended consequences increases with the size of the city. The results are robust to uncertainties in the costs and emissions parameters. The study also includes a discussion of a current transit system. Since many current transit systems have not yet been optimally designed, it should be possible to reduce their GHG emissions without sacrificing the LOS. A case study of the MUNI bus system in San Francisco is used to validate this conjecture. The analysis shows that reductions in GHG emissions can be achieved when societal costs are reduced simultaneously. The cost-optimal MUNI bus system has a societal cost of 0.15 billion $/year and emits 1680 metric tons of greenhouse gases. These figures only amount to about half of the cost and a third of the emissions in the current MUNI bus system. The optimal system has a lower spatial availability but a higher temporal availability of bus service than the current system, which highlights the potential benefits of providing more frequent express bus services.
    Keywords: Engineering, transit system design, greenhouse gas emission, feeder transit, elasticity, cost minimization, continuum approximation
    Date: 2016–05–01
  6. By: Jeffrey R. Campbell; Thomas Hubbard
    Abstract: Interstate Highway openings were permanent, anticipated demand shocks that increased gasoline demand and sometimes shifted it spatially. We investigate supply responses to these demand shocks, using county-level observations of service station counts and employment and data on highway openings' timing and locations. When the new highway was close to the old route, average producer size increased, beginning one year before it opened. If instead the interstate substantially displaced traffic, the number of producers increased, beginning only after it opened. These dynamics are consistent with Hotelling-style oligopolistic competition with free entry and sunk costs and inconsistent with textbook perfect competition.
    JEL: L13 L22 L81
    Date: 2016–05
  7. By: Jose Eduardo Gomez-Gonzalez (Banco de la República de Colombia); Juliana Gamboa-Arbeláez (Banco de la República de Colombia); Jorge Hirs-Garzón (Banco de la República de Colombia); Andrés Pinchao-Rosero (Banco de la República de Colombia)
    Abstract: We study the existence and international migration of housing market bubbles, using quarterly information of twenty OECD countries for the period comprised between 1970 and 2015. We find that housing bubbles are present in all the countries included in our sample. Multiple bubbles are found in all but two of the countries included in our sample. We found ten episodes of migration. All of them had origin in the US housing bubble preceding the subprime crisis. Most migrations were to European countries. Notably, the Spanish housing bubble was not a direct consequence of the US housing bubbles. Its origin must be found in other causes. Classification JEL: G01; G12; C22
    Keywords: Housing bubbles, International migration of bubbles, Recursive right-tailed unit root tests.
    Date: 2016–05
  8. By: Umut Özek; David N. Figlio
    Abstract: We make use of a new data source – matched birth records and longitudinal student records in Florida – to study the degree to which student outcomes differ across successive immigrant generations. Specifically, we investigate whether first, second, and third generation Asian and Hispanic immigrants in Florida perform differently on reading and mathematics tests, and whether they are differentially likely to get into serious trouble in school, to be truant from school, to graduate from high school, or to be ready for college upon high school graduation. We find evidence suggesting that early-arriving first generation immigrants perform better than do second generation immigrants, and second generation immigrants perform better than third generation immigrants. Among first generation immigrants, the earlier the arrival, the better the students tend to perform. These patterns of findings hold for both Asian and Hispanic students, and suggest a general pattern of successively reduced achievement – beyond a transitional period for recent immigrants – in the generations following the generation that immigrated to the United States.
    JEL: I20 I24 J15
    Date: 2016–05
  9. By: Eerola, Essi; Määttänen, Niku
    Abstract: ​We study the interaction of matching and credit frictions in the housing market. In the model, risk-averse households may save or borrow in order to smooth consumption over time and finance owner housing. Prospective sellers and buyers meet randomly and bargain over the price. We analyze how borrowing constraints influence house price determination in the presence of matching frictions. We also show that credit frictions greatly magnify the effects of matching frictions. For instance, in the presence of matching frictions, a moderate tightening of the borrowing constraint increases idiosyncratic price dispersion and the average time-on-the-market substantially.
    Keywords: housing, borrowing constraint, matching
    JEL: E21 R21 C78
    Date: 2015–10–05
  10. By: Samuel Bazzi (Boston University & BREAD); Matthew Gudgeon (Boston University)
    Abstract: The creation of new local governments is a key feature of decentralization in developing countries. This process often causes substantial changes in contestable public resources and the local diversity of the electorate. We exploit the plausibly exogenous timing of new district creation in Indonesia to iden- tify the implications of these changes for violent conflict. Using new geospatial data on violence, we show that allowing for redistricting along group lines can reduce conflict. However, these reductions are undone and even reversed if the newly defined electorates are ethnically polarized, particularly in areas that receive an entirely new seat of government. We identify several mechanisms highlighting the violent contestation of political control.
    Keywords: Conflict, Polarization, Ethnic Diversity, Decentralization
    JEL: D72 D74 H41 H77 O13 Q34
  11. By: Marta De Philippis (London School of Economics); Federico Rossi (Bank of Italy; Centre For Economic Policy Research; London School of Economics; Centre for Macroeconomics (CFM))
    Abstract: Results from international standardized tests show large and persistent differences across countries in students’ performances. East Asian countries like China, Korea, Japan and Singapore consistently position themselves at the top of international rankings, while the performance in several Latin American, Middle Eastern and Southern European countries has often been disappointing. This paper investigates the sources of these gaps. Understanding them is important since recent research gives a central role to human capital quality, as measured by standardized tests, for explaining cross-country differences in economic performance. While the debate has mostly focused on cross-country differences in school quality, we argue that culture and parental inputs are important as well. We compare the school performance of second generation immigrants from different nationalities but educated in the same school, and find that those coming from high-scoring countries in the PISA test do better than their peers. The gap is larger among students whose parents have recently immigrated and have little education, suggesting that the importance of country-specific cultural traits declines as parents integrate in their host countries. We also document that parents from high-scoring countries spend more time with their children, who in turn study for more hours than their peers. We use our estimates to decompose how much of the cross-country variation in PISA scores is accounted by different sources. We find that parental inputs explain an important share the outperformance of East Asian countries with respect to other regions, in particular Southern European (at least 40%) and Middle Eastern (at least 38%) countries, while they play a more limited role for Latin American countries and the United States. Our results suggest that importing features of the East Asian schooling system might not be enough to reach similar level of schooling performance. Human capital investment has an important cultural component, which might be hard to affect through policy.
    Date: 2016–05
  12. By: Leighton, Margaret; Souza, Priscila; Straub, Stéphane
    Abstract: Does social promotion perpetuate shortfalls in student achievement, or can low-achieving students catch up with their peers when they are pushed ahead? Using data from Brazilian primary schools, this paper presents evidence of substantial catch up among socially promoted students. After documenting sorting across schools in response to the policy, in particular away from gatedpromotion private schools, we show that social promotion cycles has no significant effect on municipality enrolment figures or on the percentage of students.
    Date: 2016–05
  13. By: Tra, Constant; Towe, Charles
    Keywords: Environmental Economics and Policy,
    Date: 2016
  14. By: J. Vernon Henderson; Tim Squires; Adam Storeygard; David Weil
    Abstract: We study the distribution of economic activity, as proxied by lights at night, across 250,000 grid cells of average area 560 square kilometres. We first document that nearly half of the variation can be explained by a parsimonious set of physical geography attributes. A full set of country indicators only explains a further 10%. When we divide geographic characteristics into two groups, those primarily important for agriculture and those primarily important for trade, we find that the agriculture variables have relatively more explanatory power in countries that developed early and the trade variables have relatively more in countries that developed late, despite the fact that the latter group of countries are far more dependent on agriculture today. We explain this apparent puzzle in a model in which two technological shocks occur, one increasing agricultural productivity and the other decreasing transportation costs, and in which agglomeration economies lead to persistence in urban locations. In countries that developed early, structural transformation due to rising agricultural productivity began at a time when transport costs were still relatively high, so urban agglomerations were localized in agricultural regions. When transport costs fell, these local agglomerations persisted. In late developing countries, transport costs fell well before structural transformation. To exploit urban scale economies, manufacturing agglomerated in relatively few, often coastal, locations. With structural transformation, these initial coastal locations grew, without formation of more cities in the agricultural interior.
    Keywords: agriculture, physical geography, development
    JEL: O13 O18 R12
    Date: 2016–05
  15. By: Torres, Ariana; Marshall, Maria; Delgado, Michael
    Abstract: This project assesses the effect of social capital, defined as the clustering of Hispanics, on the probability of Hispanic business creation. A big issue in the social capital literature is identification. We use new econometric procedures to try to address this possible endogeneity and draw causal conclusions on the effect of social interactions on individual economic behavior. This essay provide robust empirical evidence on the role of social capital on Hispanic entrepreneurship. We also tackle the constructs of Hispanic heterogeneity and find a potential indicator for the Hispanic entrepreneurial environment.
    Keywords: Hispanic, entrepreneurship, social capital, clustering, endogeneity, instrumental variable, Latino, Community/Rural/Urban Development, Labor and Human Capital,
    Date: 2016
  16. By: Guillaume Daudin (LEDa - Laboratoire d'Economie de Dauphine - Université Paris IX - Paris Dauphine); Raphaël Franck (Bar-Ilan University - Bar-Ilan University [Israël]); Hillel Rapoport (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics)
    Abstract: France experienced the demographic transition before richer and more educated countries. This paper offers a novel explanation for this puzzle that emphasizes the diffusion of culture and information through internal migration. It tests how migration affected fertility by building a decennial bilateral migration matrix between French regions for 1861-1911. The identification strategy uses exogenous variation in transportation costs resulting from the construction of railways. The results suggest the convergence towards low birth rates can be explained by the diffusion of low-fertility norms by migrants, especially by migrants to and from Paris.
    Keywords: Fertility,France,Demographic Transition,Migration
    Date: 2016–05
  17. By: Kazenin, Konstantin Igorevich (Russian Presidential Academy of National Economy and Public Administration (RANEPA))
    Abstract: The preprint considered scientific approaches to the study of phenomena related to the migration process. Considered and compared send theories, using the concept of integration and adaptation. The authors describe the features of the case studies the integration of migrants in Turkey, China and Istanbul. Based on empirical data collected in the course of carrying out semi-structured interviews with students of Makhachkala, in this study are considered stereotypical representation of migrants from rural areas, common among young people. Identified barriers to adaptation and integration of students into the urban environment. Particular attention is paid to the influence of relatives at adapting foreign students. Identify the factors that contribute to the adaptation of the primary students. In addition, in the described and analyzed the positive experience of working with students in high schools in Makhachkala.
    Keywords: migration process, urbanization, rural workers, Makhachkala
    Date: 2016–03–10
  18. By: T. Arduini
    Abstract: This paper proposes a semiparametric estimator for spatial autoregressive (SAR) binary choice models in the context of panel data with fixed effects. The estimation procedure is based on the observational equivalence between distribution free models with a conditional median restriction and parametric models (such as Logit/Probit) exhibiting (multiplicative) heteroskedasticity and autocorrelation. Without imposing any parametric structure on the error terms, we consider the semiparametric nonlinear least squares (NLLS) estimator for this model and analyze its asymptotic properties under spatial near-epoch dependence. The main advantage of our method over the existing estimators is that it consistently estimates choice probabilities. The finite-dimensional estimator is shown to be consistent and root-n asymptotically normal under some reasonable conditions. Finally, a Monte Carlo study indicates that the estimator performs quite well in finite samples.
    JEL: C14 C21 C23 C25 R15
    Date: 2016–01
  19. By: Tim R. Sass; Ron W. Zimmer; Brian P. Gill; Kevin T. Booker
    Abstract: Since their inception in 1992, the number of charter schools has grown to more than 6,800 nationally, serving nearly three million students.
    Keywords: Charter high school, Long-term attainment, earnings, Education
    JEL: I
    Date: 2016
  21. By: Takeshi Aida (National Graduate Institute for Policy Studies)
    Abstract: This study investigates how pesticide use by neighboring farmers affects a given farmer's pesticide use. Although it is common knowledge that pesticide use has spatial externalities, few empirical economic studies directly analyze this issue. Applying the spatial panel econometric model to the plot-level panel data in Bohol, the Philippines, this study shows that the pesticide use, especially for herbicides, is spatially correlated although there is no statistically significant spatial correlation in unobserved shocks. This implies that farmers apply pesticides by mimicking neighboring farmers' behavior rather than rationally responding to the intensity of infestation.
    Date: 2016–05
  22. By: Gottlieb, Paul D.; Lubeck, Meggan; Marxen, Lucas
    Abstract: This study looks for one unintended consequence of large-lot zoning: the possibility that it will increase the amount of land converted from rural land cover to suburban lawn, even as it reduces the number of homes that are built in a community. This is one definition of “urban sprawl.” Few zoning studies consider selection bias in the choice of the zoning treatment. When the dependent variable measures parcel development (0 or 1) or land cover change (% of land converted), controls for selection bias are even less common, because these models employ nonlinear link functions. The present study uses inverse propensity score weighting to control for selection bias across six zoning classes in a study of the percentage of land cover change in northwestern New Jersey from 1995 to 2002
    Keywords: land use, land cover, zoning, rural preservation, urban sprawl, Community/Rural/Urban Development, Land Economics/Use, Resource /Energy Economics and Policy, Q15, Q24, R14, R31, R38,
    Date: 2016
  23. By: Díaz-Lanchas, Jorge (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.); Llano, Carlos (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.); Minondo, Asier (Deusto Business School, University of Deusto.); Requena, Francisco (Universitat de Valencia. Departamento de Estructura Economica.)
    Abstract: Do large and small cities exhibit different patterns of export specialization? Using highly disaggregated product-level trade data for Brazilian cities in year 2013, we find that more populated urban areas export proportionately more complex and skill-intensive goods than less populated urban areas. We also show that Brazilian urban areas that have increased more in population have also augmented more than proportionately the exports of complex and skill-intensive goods. Our empirical findings support recent models which argue that large cities attract more skilled workers and exhibit a wide range of capabilities, providing them a comparative advantage in skill-intensive and complex goods.
    Keywords: urban areas, exports, complexity, skills, comparative advantage, Brazil
    JEL: F11 F14 R12
    Date: 2016–05
  24. By: Francis, Bill B.; Hasan, Iftekhar; Kostova, Gergana L.
    Abstract: We assess the importance of industry peers for a firm’s own decision making strategy, using a rich sample of data covering 47 countries and 87 different industries between 1990 and 2011. Following the instrumental variable approach suggested by Leary and Roberts (2014), we find that, similar to U.S. firms, foreign firms do follow their peers when they make financial policy decisions. A standard deviation increase in peer firms’ average leverage leads to about 5 percentage points increase in a firm’s own leverage. We also find evidence that firms are more likely to follow their peers when investor protection laws including information disclosure and minority shareholder protection are weak, when creditor rights laws are strong, and when equity markets are more developed, suggesting that peers matter the most when firms have the greatest need to learn and to demonstrate their quality. These results hold even when we perform the analysis on a matched sample of firms.
    Keywords: peers, international capital structure, financial policy, information environment, legal environment, financial market development
    JEL: G2 G32
    Date: 2016–04–21

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