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on Urban and Real Estate Economics |
| By: | Laurent Denant-Boèmont (University of Rennes1 - CREM UMR CNRS 6211, France); Carl Gaigné (INRA, UMR1302 SMART, France and University of LAVAL, CREATE, Québec, Canada); Romain Gaté (University of Rennes1 - CREM UMR CNRS 6211, France and INRA, UMR1302 SMART, France) |
| Abstract: | In this paper, we study the effects of urban design on pollution and welfare. We build a theoretical model of residential choices with pollution externalities arising from commuting, where the size of the central business district (CBD) and the demand for housing are endogenous. We show that a polycentric city is desirable from welfare and ecological perspective, provided that travel speed and/or the number of roads directly connected with the CBD are sufficiently high. The spatial extension of cities remains the critical variable to curb transport-related urban pollution. |
| Keywords: | Urban form; Housing; Travel speed; Carbon emissions; Welfare |
| JEL: | Q53 R14 R21 |
| Date: | 2016–10 |
| URL: | http://d.repec.org/n?u=RePEc:tut:cremwp:2016-18&r=ure |
| By: | Saadi, Vahid |
| Abstract: | This paper studies the role of the Community Reinvestment Act (CRA) in the recent US housing boom-bust cycle. Using a difference-in-differences matching estimation, I find that the enhancement of CRA enforcement in 1998 caused a 7.7 percentage points increase in annual growth rate of mortgage lending by CRA-regulated banks to CRA-eligible census tracts relative to a group of similar-income CRA-ineligible census tracts within the same state. Financial institutions which are not subject to the CRA, however, do not show any change in their mortgage supply between these two types of census tracts after 1998. I take advantage of this exogenous shift in mortgage supply within an instrumental variable framework to identify the causal effect of mortgage supply on housing prices. I find that every 1 percentage point higher annual growth rate of mortgage supply leads to 0.3 percentage points higher annual growth rate of housing prices. Reduced form regressions show that CRA-eligible neighborhoods experienced higher house price growth during the boom and sharper decline during the bust period. I use placebo tests to confirm that this effect is in fact channeled through the shift in mortgage supply by CRA-regulated banks and not by unobserved demand factors. Furthermore, my results indicate that CRA-induced mortgages went to borrowers with lower FICO scores, carried higher interest rates, and encountered more frequent delinquencies. |
| Keywords: | The Community Reinvestment Act,Mortgage supply,House prices,Homeownership |
| JEL: | G28 G21 R21 R31 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:safewp:155&r=ure |
| By: | Dean Baker; Lara Merling |
| Abstract: | In the last decade, there was an unprecedented run-up in house prices in most parts of the country. It was easy to recognize this run-up as a bubble since there was no remotely corresponding increase in rents, which for the most part just tracked inflation during this period. There was also no evidence of a shortage of housing supply. Housing starts were at near record highs from 2002 to 2005. In addition, the vacancy rate as reported by the Commerce Department was at near record highs through most of this period. With weak job and wage growth throughout most of this period, it was possible to recognize the run-up as a bubble even without knowing anything about the proliferation of bad loans in the mortgage market. The run-up in real house prices in the bubble years was almost completely reversed in the subsequent crash. While the first-time homebuyers’ tax credit temporarily stopped and reversed the decline, house prices continued to fall until the spring of 2012. Since then, the market has recovered much of the lost ground. While it is still 20.1 percent below the bubble peaks of 2006 in real terms, inflation-adjusted house prices are now 37.7 percent above their level in 1996, before the beginnings of the bubble. While these prices may seem somewhat high, there is little basis for concern that the national market has again entered a bubble. |
| JEL: | E E3 E39 R R2 R21 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:epo:papers:2016-21&r=ure |
| By: | Stephen L. Ross (University of Connecticut); Zhentao Shi (Chinese University of Hong Kong) |
| Abstract: | Studies that can distinguish between exogenous and endogenous peer effects of social interactions are relatively rare. One recent identification strategy exploits partial overlapping groups of peers. If a student has two groups of separated peers, the peer choices are correlated through that specific student's choice, but one group's attributes are assumed to directly influence neither the other peer group's attributes nor the choices. In the context of academic performance in higher education, however, the evidence of peer effects on academic outcomes has been mixed, creating a potential for weak instruments. We utilize a period of transition when students were being reassigned to dormitories from a new campus to an old campus. Many groups of roommates were broken up at the end of freshman year, and then combined with other groups of students from the same school in the sophomore year. We find reduced-form evidence that information about a student's previous year roommates can explain the current test scores of their new roommates. However, due to weak instruments, the estimated endogenous effects appear unreasonably large. We draw on weak-IV robust tests, namely the Anderson-Rubin-type S-test (Stock and Wright, 2000) and Kleibergen's Lagrangian multiplier test (Kleibergen, 2005), to provide properly-sized tests for the endogenous effects between the test scores of current roommates and to calculate lower bounds of such effects. These tests strongly reject the null hypothesis of no endogenous effects. JEL Classification: C26, C51, I23, J00 Key words: academic performance, hypothesis testing, endogenous peer effects, random assignment, weak instruments |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:uct:uconnp:2016-37&r=ure |
| By: | Roberto Basile (Seconda Università di Napoli); Alessandro Girardi (ISTAT, Istituto Nazionale di Statistica); Marianna Mantuano (ISTAT, Istituto Nazionale di Statistica); Giuseppe Russo (Università di Salerno and CSEF) |
| Abstract: | The role of labour mobility on regional disparities is at the core of a heated debate: while standard competitive models posit that mobility works as an equilibrating device and reduces the unemployment, models featuring externalities lead to opposite conclusions. Against this backdrop, we present a simple two-region model adapted to the main features of the Italian North-South dualism that illustrates the effects of labour mobility with and without human capital externalities. We show that, when externalities are introduced, regional mobility may exacerbate regional unemployment disparities. Using longitudinal data over the years 2002- 2011 for 103 NUTS-3 Italian regions, we document that net outflows of human capital from the South to the North have increased the unemployment rate in the South and decreased the unemployment rate in the North. Our conclusions support the literature that finds an important role of regional externalities, and suggest that reducing human capital flight from Southern regions should be a priority. |
| Keywords: | Unemployment, Migration, Human capital, Externalities, Italian regions |
| JEL: | C23 R23 J61 |
| Date: | 2016–12–08 |
| URL: | http://d.repec.org/n?u=RePEc:sef:csefwp:460&r=ure |
| By: | Lerbs, Oliver; Teske, Markus |
| Abstract: | Individual sales prices and local vacancy rates in the housing market pose a natural analogy to the wage curve, a popular concept in labor economics that describes how individual wages decrease with higher local unemployment. While housing search and matching models and housing externalities strongly suggest a stable inverse relationship, there is still a lack of convincing empirical research on the sensitivity of house sales to local vacancy variation. Based on more than 10,000 single-family home transactions from the German market, this paper confirms a robust house price-vacancy curve among individual home prices and adjacent residential vacancies. The economic size of the relationship is highly comparable across all four analyzed states: a doubling of the vacancy rate at the municipality level is associated with a 5-8% discount in quality-controlled selling prices. Despite negative price signals, local vacancy distributions tend to persist over long time horizons, leaving room for policy intervention. |
| Keywords: | House prices,Housing vacancy,Hedonic regression,Wage curve |
| JEL: | R23 R31 R58 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:16082&r=ure |
| By: | Rudiger Ahrend; Alexander C. Lembcke |
| Abstract: | This study approaches the question whether it “pays” to live in big(ger) cities in a three-fold manner: first, it estimates how city size affects worker productivity (agglomeration benefits) in Germany, based on individual-level wage data. Second, it considers whether productivity benefits translate into real gains for workers by taking local price levels into account. Third, it examines the role of amenities in explaining differences in real benefits across cities. The estimated elasticity for agglomeration benefits is around 0.02, implying that comparable workers in Hamburg (3 million residents) are about 6% more productive than in Recklinghausen (150 000). But agglomeration benefits are, on average, offset by higher prices, i.e. city size does not systematically translate into real pecuniary benefits for workers. Amenities, e.g. seaside access, theatres, universities, or “disamenities”, e.g. air pollution, explain – to a large degree – variation in real pecuniary benefits, i.e. real wages are higher in low-amenity cities. |
| Keywords: | agglomeration benefits, agglomeration costs, cities, cost of living, Functional Urban Areas, local amenities |
| JEL: | J31 R23 R12 |
| Date: | 2016–12–15 |
| URL: | http://d.repec.org/n?u=RePEc:oec:govaab:2016/9-en&r=ure |
| By: | Pierre-Philippe Combes (Univ Lyon, CNRS, GATE L-SE UMR 5824, F-69131 Ecully, France ; Sciences Po, Economics Department, 28, Rue des SaintsPères, 75007 Paris, France); Gilles Duranton (Wharton School, University of Pennsylvania, 3620 Locust Walk, Philadelphia, pa 19104, usa); Laurent Gobillon (PSE-CNRS, 48 Boulevard Jourdan, 75014 Paris, France) |
| Abstract: | We propose a new nonparametric approach to estimate the production function for housing. Our estimation treats output as a latent variable and relies on the firstorder condition for profit maximisation with respect to nonland inputs by competitive house builders. For parcels of a given size, we compute housing by summing across the marginal products of nonland inputs. Differences in nonland inputs are caused by differences in land prices that reflect differences in the demand for housing across locations. We implement our methodology on newlybuilt singlefamily homes in France. We find that the production function for housing is reasonably well, though not perfectly, approximated by a CobbDouglas function and close to constant returns. After correcting for differences in user costs between land and nonland inputs and taking care of some estimation concerns, we estimate an elasticity of housing production with respect to nonland inputs of about 0.80. |
| Keywords: | housing, production function |
| JEL: | R14 R31 R32 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:1637&r=ure |
| By: | Barrow, Lisa (Federal Reserve Bank of Chicago); Sartain , Lauren (University of Chicago); de la Torre, Marisa (University of Chicago) |
| Abstract: | We investigate whether elite Chicago public high schools can help close the achievement gap between high-achieving students from more and less affluent neighborhoods. Seats are allocated based on prior achievement with 70 percent reserved for high-achieving applicants from four neighborhood socioeconomic status (SES) categories. Using regression discontinuity design, we find no effect on test scores or college attendance for students from high- or low-SES neighborhoods and positive effects on student reports of their experiences. For students from low-SES neighborhoods, we estimate significant negative effects on rank in high school, grades and the probability of attending a selective college. |
| Keywords: | Educational equalization; high school; low-income; regression analysis; universities and colleges admission |
| JEL: | I22 I24 |
| Date: | 2016–11–06 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-2016-17&r=ure |
| By: | Jian-Xin Wu; Ling-Yun He |
| Abstract: | This paper examines the dynamic behavior of city size using a distribution dynamics approach with Chinese city data for the period 1984-2010. Instead of convergence, divergence or paralleled growth, multimodality and persistence are the dominant characteristics in the distribution dynamics of Chinese prefectural cities. Moreover, initial city size matters, initially small and medium-sized cities exhibit strong tendency of convergence, while large cities show significant persistence and multimodality in the sample period. Examination on the regional city groups shows that locational fundamentals have important impact on the distribution dynamics of city size. |
| Date: | 2016–10 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1612.02657&r=ure |
| By: | Michael Bates (Department of Economics, University of California Riverside) |
| Abstract: | Informational asymmetries between employers may inhibit optimal worker mobility. However, evidence is limited because researchers rarely observe shocks to employers' information. I exploit two school districts' adoptions of value-added (VA) measures of teacher effectiveness—informational shocks to some, but not all, employers—to provide direct tests of asymmetric employer learning. I develop a learning model and test its predictions for teacher mobility. I find that adopting VA increases within-district mobility of high-VA teachers, while low-VA teachers move out-of-district to uninformed principals. These patterns evidence asymmetric employer learning. This sorting from widespread VA adoption exacerbates inequality in access to effective teaching. |
| Keywords: | asymmetric employer learning, value added, teachers |
| JEL: | D83 I24 J63 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:ucr:wpaper:201616&r=ure |
| By: | Amy Ellen Schwartz (Center for Policy Research, Maxwell School, Syracuse University, 426 Eggers Hall, Syracuse, NY 13244); Agustina Laurito (New York University); Johanna Lacoe (Mathematica Policy Research); Patrick Sharkey (New York University); Ingrid Gould Ellen (New York University) |
| Abstract: | We estimate the causal effect of repeated exposure to violent crime on test scores in New York City. We use two distinct empirical strategies; value-added models linking student performance on standardized exams to violent crimes on a student’s residential block, and a regression discontinuity approach that identifies the acute effect of an additional crime exposure within a one-week window. Exposure to violent crime reduces academic performance. Value added models suggest the average effect is very small; approximately -0.01 standard deviations in English Language Arts (ELA) and mathematics. RD models suggest a larger effect, particularly among children previously exposed. The marginal acute effect is as large as -0.04 standard deviations for students with two or more prior exposures. Among these, it is even larger for black students, almost a 10th of a standard deviation. We provide credible causal evidence that repeated exposure to neighborhood violence harms test scores, and this negative effect increases with exposure. |
| Keywords: | Neighborhood Effects; Crime; Academic Performance; Racial Disparities; Educational Outcomes |
| JEL: | I20 I21 R23 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:max:cprwps:195&r=ure |
| By: | Xu, Hangtian; Itoh, Hidekazu |
| Abstract: | By exploiting the 1995 Hanshin earthquake, which occurred in Japan, as an exogenous shock to the container shipping industry of northeastern Asia, this study provides an empirical relevance of the role of transport density economies in shaping the transport geography. The Hanshin earthquake caused severe damage to the Kobe port. Consequently, its container throughput was largely diverted to the nearby Busan port, which scaled up in this windfall. Focusing on the long-term growth of major port areas in northeastern Asia, we find that extensive diversions of container traffic occurred after the earthquake from Tokyo and Yokohama ports to Busan port, although container shipping operations in Tokyo and Yokohama ports were not directly affected by the earthquake. We interpret the economies of transport density benefitting Busan as the underlying mechanism; increased transport density allows Busan port to further enlarge its hinterlands and reshape the transport geography. We also find that the unintended diversions of container shipping lead to a structural change of manufacturing pattern in related regions. |
| Keywords: | hub port; density economies; transport geography; earthquake |
| JEL: | F1 L0 R4 |
| Date: | 2016–12–14 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:75580&r=ure |
| By: | Ling-yun He; Li Liu |
| Abstract: | Road transport sector is found to be one of the major emitters, and responsible for serious air pollution and huge pubic health losses. One important parameter for determining the consequences of transport demand shocks for the macroeconomy, air pollution and public health is the elasticity of the demand for transport. Most published studies that use flexible functional forms have ignored the theoretical regularity conditions implied by microeconomic theories. Moreover, even a few studies have checked and/or imposed regularity conditions, most of them equate curvature alone with regularity, thus ignoring or minimizing the importance of other regularities. And then, the results appear biased and may in fact be biased. Therefore, we select three of the most widely used flexible functional forms, the Rotterdam model, the Almost Ideal Demand System (AIDS), and the quadratic AIDS (QUAIDS) to investigate the demand for road transport in China using recent annual expenditure data, over a 13 year period from 2002 to 2014, on three expenditure categories in the transportation sector: private transportation, local transportation and intercity transportation. Estimation shows that the AIDS model is the only model that is able to provide theoretically consistent estimates of the residents demand for road transport in China. Our estimates show that the private transportation is a luxury among the transportation goods, and is elastic in price changes relatively. The empirical results imply that the private and the local transportation, the local and intercity transportation are gross complements. And, the private transportation is a substitute for the inter-city transportation, while the intercity transportation is a complement of the private transportation. |
| Date: | 2016–10 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1612.02656&r=ure |
| By: | Orea, L.; Álvarez, I; Jamasb, T. |
| Abstract: | An important methodological issue for the use of efficiency analysis in incentive regulation of regulated utilities is how to account for the effect of unobserved cost drivers such as environmental factors. This study combines the spatial econometric approach with stochastic frontier techniques to control for unobserved environmental conditions when measuring firms’ efficiency in the electricity distribution sector. Our empirical strategy relies on the geographic location of the firms as a useful source of information that has previously not been explored in the literature. The underlying idea in our empirical proposal is to utilise variables from neighbouring firms that are likely to be spatially correlated as proxies for the unobserved cost drivers. We illustrate our approach using the data of Norwegian distribution utilities for the years 2004 to 2011. We find that the lack of information on weather and geographic conditions can likely be compensated with data from surrounding firms using spatial econometric techniques. Combining efficiency analysis and spatial econometrics methods improve the goodness-of-fit of the estimated models and, hence, more accurate (fair) efficiency scores are obtained. The methodology can also be used in efficiency analysis and regulation of other types of utility sectors. |
| Keywords: | Spatial econometrics, stochastic frontier models, environmental conditions, electricity distribution networks. |
| JEL: | D24 L51 L94 |
| Date: | 2016–12–12 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1673&r=ure |
| By: | Marco Di Cataldo; Andrés Rodríguez-Pose |
| Abstract: | The European Union promotes development strategies aimed at producing growth with “a strong emphasis on job creation and poverty reduction”. However, whether the economic conditions in place in EU regions are ideal for the generation of high- and low-skilled employment and labour market inclusion is unclear. This paper assesses how the key factors behind EU growth strategies – infrastructure, human capital, innovation, quality of government – condition employment generation and labour market exclusion in European regions. The findings indicate that the dynamics of employment and social exclusion vary depending on the conditions in place in a region. While higher innovation and education contribute to overall employment generation in some regional contexts, low-skilled employment grows the most in regions with a better quality of government. Regional public institutions, together with the endowment of human capital, emerge as the main factors for the reduction of labour market exclusion – particularly in the less developed regions – and the promotion of inclusive employment growth across Europe. |
| Keywords: | social exclusion; employment; skills; regions; Europe |
| JEL: | J64 O52 R23 |
| Date: | 2016–10–04 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:68510&r=ure |
| By: | Elzbieta Antczak; Ewa Galecka-Burdziak; Robert Pater |
| Abstract: | We analyse the extent to which spatial interactions affect the labour market matching process. We apply spatial econometrics methods, including spatial panel Durbin models, which are rarely used in labour market matching analysis. We use the data on stocks and inflows of unemployed individuals and vacancies registered at public employment offices in Poland. We conduct the analysis at the NUTS-3 and NUTS-4 levels in Poland for the period 2003-2014. We find that (1) spatial interactions affect the matching processes in the labour market; (2) workers commute long distances, and many of these commutes involve crossing only one administrative border; (3) spatial indirect, direct, and total spillover effects determine the scale of outflows from unemployment in the focal and adjacent areas; and (4) spatial modelling is a more appropriate approach than classical modelling for the matching function. |
| Keywords: | spatial interaction; spillover effect; matching function; region; |
| JEL: | C23 J61 J64 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp578&r=ure |
| By: | Gilat Levy; Ronny Razin |
| Abstract: | In this paper we analyze the coevolution of segregation into private and state schools, beliefs about the educational merits of di¤erent schools, and labour market discrimination. In a dynamic model, we characterize a necessary and sufficient condition on initial levels of segregation and beliefs under which full polarisation of beliefs and long run labour market discrimination are sustainable. The model suggests a new perspective on the long term e¤ects of different policy interventions, such as integration, school vouchers and policies that are directly targeted towards influencing beliefs. |
| JEL: | D0 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:68532&r=ure |
| By: | Cheng, Chak Hung Jack (George Dean Johnson, Jr. College of Business and Economics, University of South Carolina Upstate); Chiu, Ching-Wai (Jeremy) (Bank of England) |
| Abstract: | This paper provides robust evidence for the non-linear effects of mortgage spread shocks during recessions and expansions in the United States. Estimating a smooth-transition VAR model, we show that mortgage spread shocks hitting in recessionary regimes create significantly deeper and more protracted decrease in industrial production and prices, as well as a persistent fall in house prices. Evidence also suggests that shock propagation is amplified through the interaction of stock prices. Our empirical results complement the theoretical literature which emphasizes the role of occasionally binding collateral constraints and asset prices in explaining macroeconomic asymmetries. |
| Keywords: | Mortgage spread shocks; smooth transition vector autoregressions; nonlinearities; financial frictions |
| JEL: | C32 E32 E44 E52 |
| Date: | 2016–12–09 |
| URL: | http://d.repec.org/n?u=RePEc:boe:boeewp:0634&r=ure |
| By: | Huttunen, Kristiina (Aalto University School of Economics); Møen, Jarle (Dept. of Economics, Norwegian School of Economics and Business Administration); Salvanes, Kjell G. (Dept. of Economics, Norwegian School of Economics and Business Administration) |
| Abstract: | It is well documented that displaced workers suffer severe earnings losses, but not why this is so. One reason may be that workers are unable or unwilling to move to regions with better employment opportunities. We study this and find that job displacement increases regional mobility but the mobility decisions are driven also by non-economic factors such as family ties. As a results, movers tend to be a heterogeneous group. We find that on average displaced workers who move suffer larger income losses than displaced workers who stay in the same region. However, the entire post displacement income difference between movers and stayers is driven by workers moving to regions where parents live or to rural areas. |
| Keywords: | Plant closures; downsizing; regional mobility; earnings; family ties. |
| JEL: | J12 J21 J61 J65 |
| Date: | 2016–04–29 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhheco:2016_017&r=ure |
| By: | Rodger Barros Antunes Campos |
| Abstract: | The public policies programs for low-income housing in Brazil started in the 1930s, and most recently the well-advertised program “My House, My Life” by the Federal government had on its goals to improve the quality of life of poor people, to reduce the housing deficit and to foster the economy. The question raised by this paper is how important was the contribution of the program for the economic growth observed in the Brazilian economy in previous years? In a way to shed light on this question, the case of the low-income housing programs in the state of São Paulo is take as an example. The State program being a joint venture among the federal, state and municipal governments. To do so, a specific interregional input-output model is estimated for two regions, São Paulo and Rest of Brazil, with the insertion in the model of 6 different typologies of low income housing, ranging from a single house to building complexes. The impacts are measured in terms of GDP, tax collection and employment in the State of São Paulo and in the Rest of Brazil, showing that depending on the housing typology, the impacts in the economy are different, and that part of the investments made returns to the government in terms of tax collection. As results, the programs affects the state economy system for expanding the demand for inputs for the construction of new buildings (direct effect); demand in other sectors due to the initial shock (indirect effect); and the income of families - as more labor is required and therefore widens the aggregated wage – it extends the demand for goods and services in the economy (induced effect). |
| Keywords: | Low Income Housing; Housing Public Policies; Socioeconomic Impacts; Input-Output; Brazil; São Paulo State |
| JEL: | R30 R15 |
| Date: | 2016–10–20 |
| URL: | http://d.repec.org/n?u=RePEc:spa:wpaper:2016wpecon21&r=ure |
| By: | Smith, Andrew S.J. (Institute for Transport Studies (ITS) and Leeds University Business School); Odolinski, Kristofer (VTI); Hossein Nia, Saeed (KTH); Jönsson, Per-Anders (KTH); Stichel, Sebastian (KTH); Iwnicki, Simon (Institute of Railway Research (IRR), University of Huddersfield); Wheat, Phillip (Institute for Transport Studies (ITS) and Leeds University Business School) |
| Abstract: | In this paper we combine engineering and economic methods to estimate the relative cost of damage mechanisms on the Swedish rail infrastructure. The former method is good at predicting damage from traffic, while the latter is suitable for establishing a relationship between damage and cost. We exploit the best features of both methods in a two-stage approach and demonstrate its applicability for rail infrastructure charging. Our estimations are based on 143 track sections comprising about 11 000 km of tracks. We demonstrate how the estimated relative costs of damage mechanisms can be used in order to calculate the marginal wear and tear cost of different vehicle types. The results are relevant for infrastructure managers in Europe who desire to differentiate their track access charges such that each vehicle pays its short run-marginal wear and tear cost, which can create a more efficient use of the rail infrastructure. |
| Keywords: | Marginal cost; Rail infrastructure; Maintenance; Access charging; Track damage; Econometric methods; Engineering simulation |
| JEL: | L92 R48 |
| Date: | 2016–12–09 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ctswps:2016_026&r=ure |
| By: | Hong Son Nghiem (Institute of Health and Biomedical Innovation, Queensland University of Technology); Ha Trong Nguyen (Bankwest Curtin Economics Centre, Curtin University); Luke B Connelly (Faculty of Health and Behavioural Sciences, The University of Queensland) |
| Abstract: | This study examines the efficiency of schools in Australia and its determinants using the gain in NAPLAN test scores of students in 6,774 schools in 2009-2011. The results show that, based on empirical input-output combinations, the growth of NAPLAN test scores in Australian schools could be improved by 64 per cent by learning from best practice, on average. At the primary level, Catholic and independent schools are less efficient than public schools. At the secondary school level, though, public schools are found to be less efficient than other (non-public) schools. |
| Keywords: | DEA, Australia, double bootstrap, gain of test scores |
| JEL: | I21 D24 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:ozl:bcecwp:wp1603&r=ure |
| By: | Atallah, Shady S.; Gomez, Miguel I.; Conrad, Jon M. |
| Abstract: | We propose a novel, distance- and density-dependent specification of externalities that captures spatial dynamics within and between neighboring land parcels. We apply the problem to the short- and long-distance diffusion and control of an infectious disease in two privately-owned and ecologically-connected vineyards. Using computational experiments to generate individual and aggregate payoffs, we show how strategic behavior affects diffusion of the disease and the expected present value of the resulting externality. Our results suggest that ignoring the withinparcel spatial dynamics in the model overestimates the social cost of an externality compared to a model that focuses on inter-parcel spatial dynamics only. We find a U-shaped relationship between manager heterogeneity and aggregate payoffs in the presence of an externality, suggesting both positive and negative impacts of increased heterogeneity on strategic behavior and welfare. |
| Keywords: | Bioeconomic models, Computational methods, Disease control, Grapevine Leafroll Disease, Noncooperative games, Spatial-dynamic externalities, Crop Production/Industries, Research and Development/Tech Change/Emerging Technologies, |
| Date: | 2016–01 |
| URL: | http://d.repec.org/n?u=RePEc:ags:cudawp:250023&r=ure |
| By: | Ekaterina A. Orel (National Research University Higher School of Economics); Alena A. Kulikova (National Research University Higher School of Economics) |
| Abstract: | Recent research indicates that behavioral problems may lead to low academic performance. The present study is aimed to discover, what differences exist between primary school students who meet a sufficient number of ADHD (Attention Deficit Hyperactivity Disorder) criteria and those who do not experience any behavioral problems, in terms of academic achievements in reading and mathematics, annual progress in these subjects and personal, social and emotional development, based on the Russian sample of first-graders. This paper is a part of Russian iPIPS project and the instruments developed as part of this study were used. The sample consists of 3021 first-graders from two big regions of the Russian Federation. The results showed significant differences in both cognitive and social-emotional development but no differences in annual progress. The absence of differences in progress means that the development of children with behavior problems within the school system goes with the same speed but from the lower start level compared to other children. The results of the study provide important knowledge for the teachers and open a large area of further investigations in the field of ADHD in Russian school settings |
| Keywords: | behavioral problems, ADHD, first-graders, primary school, iPIPS, cognitive development, social and emotional development |
| JEL: | I21 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:66psy2016&r=ure |
| By: | Karachiwalla, Naureen; Park, Albert |
| Abstract: | We provide evidence that promotion incentives influence the effort of public employees by studying China's system of promotions for teachers. Predictions from a tournament model of promotion are tested using retrospective panel data on primary and middle school teachers. Consistent with theory, promotions are associated with wage increases, higher wage increases are associated with better performance, and teachers increase effort in years leading up to promotion eligibility but reduce effort if they are repeatedly passed over for promotion. Evaluation scores are positively associated with teacher time use and with student test scores, diminishing concerns that evaluations are manipulated. |
| Keywords: | China; incentives; promotions; teachers |
| JEL: | J31 J33 J45 M51 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11704&r=ure |
| By: | Michael Insler (United States Naval Academy); Bryce McMurrey (United States Naval Academy); Alexander F. McQuoid (United States Naval Academy) |
| Abstract: | The recent expansion of police militarization in the US has led to a growing concern about the social impact from this development, and in particular, how militarized policing impacts minority communities. Nearly six billion dollars of military equipment has been transferred to local police departments through the Department of Defense Excess Property Program 1033 since its inception in 1997. In this paper, we study the impact of police militarization on civic engagement by studying charitable giving among households. Using an instrumental variables approach based on exposure to military culture through federal defense spending, we find that police militarization has a fragmenting effect on society. As police militarization increases, black households reduce the frequency and amount of charitable donations as well as the frequency of volunteering. Charitable donations to education and needy organizations are most strongly affected. Conversely, we find no such effects for white households. The results are robust to placebo and validity tests. Our estimates suggest that to offset the impact on charitable giving from increased police militarization, a black household would need to see income rise by nearly 50% on average. suspension rules. |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:usn:usnawp:53&r=ure |
| By: | Crass, Dirk; Rammer, Christian; Aschhoff, Birgit |
| Abstract: | The paper analyzes how geographical clustering of beneficiaries might affect the effectiveness of public innovation support programs. The geographical proximity of firms operating in the same industry or field of technology is expected to facilitate innovation through knowledge spillovers and other localization advantages. Public innovation support programs may leverage these advantages by focusing on firms that operate in a cluster. We investigate this link using data from a large German program that co-funds R&D projects of SMEs in key technology areas called 'Innovative SMEs'. We employ three alternative cluster measures which capture industry, technology and knowledge dimensions of clusters. Regardless of the measure, firms located in a geographical cluster are more likely to participate in the program. Firms being part of a knowledge-based cluster significantly increases their chance of receiving public financial support. We find no effects, however, of geographical clustering on the program's effectiveness in terms of input or output additionality. |
| Keywords: | Innovation,Government Policy,Regional Government Analysis |
| JEL: | C35 H50 O31 O32 O38 R59 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:16083&r=ure |
| By: | Karthik Muralidharan; Abhijeet Singh; Alejandro J. Ganimian |
| Abstract: | We present experimental evidence on the impact of a technology-aided after-school instruction program on learning outcomes in middle school grades in urban India, using a lottery that provided students with a voucher to cover program costs. A key feature of the program was its ability to individually customize educational content to match the level and rate of progress of each student. We find that lottery winners had large increases in test scores of 0.36σ in math and 0.22σ in Hindi over just a 4.5-month period. IV estimates suggest that attending the program for 90 days would increase math and Hindi test scores by 0.59σ and 0.36σ respectively. We find similar absolute test score gains for all students, but the relative gain was much greater for academically-weaker students because their rate of learning in the control group was close to zero. We show that the program precisely targets instruction to students' preparation level, thus catering effectively to the very wide variation in student learning levels within a single grade. The program was highly cost-effective, both in terms of productivity per dollar and unit of time. Our results suggest that well-designed technology-aided instruction programs can sharply improve productivity in delivering education. |
| JEL: | C93 I21 O15 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22923&r=ure |
| By: | Uwe Cantner (School of Economics and Business Administration, Friedrich-Schiller-University Jena); Tina Wolf (University of Southern Denmark, Department of Marketing and Management) |
| Abstract: | Earlier studies have shown that entrepreneurs play a key role in shaping regional development. Innovator networks where these entrepreneurs are members of have been identified as one among many critical factors for their firms' success. This paper intents to go one step further and analyses in how far differing characteristics of these networks lead to different firm performances along the early stages of the organizational life cycle (nascent stage, emergent stage, early growth stage). A sample of 149 patenting (innovative) firms in Thuringia is analysed, using data from the commercial register and the German patent office. The results show that there is an inverted u-shaped relationship between the chances of a firm to survive and the connectivity of the network the firms are connected to but only in the later stage of the early organizational life cycle; while the structure of the ego-network never plays a role. A quite central position in the network shows-up to be unfavourable. |
| Keywords: | Innovation, Entrepreneurship, Networks, Inventor, Patents, Survival |
| JEL: | L25 L26 O30 L14 |
| Date: | 2016–12–07 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2016-021&r=ure |
| By: | Zoeteman, Bastiaan (Tilburg University, School of Economics and Management) |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:tiu:tiutis:7b9470aa-4e3f-4fb3-bfb3-0700a1cc2a2c&r=ure |
| By: | Anders Fremstad (Economics Department, Colorado State University, Fort Collins); Anthony Underwood (Department of Economics, Dickinson College); Sammy Zahran (Economics Department, Colorado State University, Fort Collins) |
| Abstract: | Studies find that per capita carbon dioxide emissions (CO2) decrease with household size and urban density, so the demographic trends of declining household size and dense urbanization produce countervailing effects with respect to emissions. We posit that both trends operate on a common scaling mechanism realized through the sharing of carbon- intensive expenditures. With detailed data from the United States Consumer Expenditure Survey, we construct a dataset of CO2 emissions at the household level and leverage a unique measure of residential density to estimate household and urban economies. We find that dense urban areas have per capita emissions 23 percent lower than rural areas, and that adding an additional member to a household reduces per capita emissions by about 6 percent. We also show that household economies are about twice as large in rural as compared to dense urban areas. These results suggest that the carbon benefits of dense urbanization have the potential to offset the effects of declining household size. |
| Keywords: | Emissions, Urban Density, Sharing, Household Size, Energy |
| JEL: | D1 Q4 R2 R3 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:dic:wpaper:2016-01&r=ure |
| By: | Howley, P.; Knight, S. |
| Abstract: | This article tests for social-norm effects in labour market status. We extend previous research which has examined the relationship between aggregate unemployment and well-being as a mechanism for uncovering social-norm effects, by using a more spatially disaggregated (neighbourhood as opposed to regional) measure of unemployment. Our fixed effects regression results indicate that while unemployment hurts, it hurts much less when individuals live in neighbourhoods where the prevailing rate of unemployment is high. In keeping with the social-norm hypothesis, we also find that unemployment hurts less when individuals think of themselves as being similar to their neighbours. |
| Keywords: | social norms; unemployment; well-being; |
| JEL: | I30 J01 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:yor:hectdg:16/34&r=ure |
| By: | Joshua C. Hall (West Virginia University, Department of Economics); Joshua Matti (West Virginia University, Department of Economics); Yang Zhou (West Virginia University, Department of Economics) |
| Abstract: | The United States has a rich history of local government taxation and good provision. The last fifty years, however, have seen increasing calls for the regionalization of municipal taxes and services from policymakers. Arguments for greater regionalization emphasize improved efficiency, enhanced equity, mitigation of spillovers, and improved economic development. A number of localist scholars have responded to regionalists’ concerns. This review articulates regionalists’ arguments, the localists’ response, and then summarizes the relevant empirical literature to see which side’s theories hold forth in the data. |
| Keywords: | local governments, Bloomington School, regionalism, localism |
| JEL: | H11 H70 H71 H77 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:wvu:wpaper:16-20&r=ure |
| By: | Monica Langella; Alan Manning |
| Abstract: | This paper investigates the impact of ethnic diversity on individuals' overall satisfaction with and other aspects of their neighbourhood. It uses panel data and a variety of empirical methods to control for potential endogeneity of diversity and of the location choices. We find that a higher white share in the neighbourhood raises overall satisfaction with the neighbourhood in our (overwhelming white) sample, but has no significant impact on generalised trust or other commonly-used measures of social capital. We suggest that part of the impact of diversity on overall neighbourhood satisfaction may be through an effect on a fear of crime and the quality of social life. |
| Keywords: | neighbourhood satisfaction, social capital, diversity, deprivation |
| JEL: | Z1 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1459&r=ure |
| By: | Lu-Yi Qiu; Ling-Yun He |
| Abstract: | The air pollution has become a serious challenge in China. Emissions from motor vehicles have been found as one main source of air pollution. Although the Chinese government has taken numerous policies to mitigate the harmful emissions from road transport sector, it is still uncertain for both policy makers and researchers to know to what extent the policies are effective in the short and long terms. Inspired by the concept and empirical results from current literature on energy rebound effect (ERE), we first propose a new concept of pollution rebound effect (PRE). Then, we estimate direct air PRE as a measure for the effectiveness of the policies of reducing air pollution from transport sector based on time-series data from the period 1986-2014. We find that the short-term direct air PRE is -1.4105, and the corresponding long-run PRE is -1.246. The negative results indicate that the direct air PRE does not exist in road passenger transport sector in China, either in the short term or in the long term during the period 1986-2014. This implies that the Chinese transport policies are effective in terms of harmful emissions reduction in the transport sector. This research, to the best of our knowledge, is the first attempt to quantify the effectiveness of the transport policies in the transitional China. |
| Date: | 2016–10 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1612.02653&r=ure |
| By: | Joshua C. Hall (West Virginia University, Department of Economics); Alex Peck (Webster-Schroeder High School); Marta Podemska-Mikluch (Gustavus Adolphus College, Department of Economics and Management) |
| Abstract: | In this brief educational note, we provide several examples of directed classroom activities for the high school economics classroom using the long-running television show The Simpsons. In doing so, we provide an overview of the scholarly literature on using popular culture to teach economics. Our examples highlight how popular culture can be successfully employed at the secondary level to engage and teach students through active learning. We conclude with some thoughts for secondary social studies teachers looking to enhance economic instruction. |
| Keywords: | Economic Pedagogy, Student Engagement Techniques |
| JEL: | A22 D01 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:wvu:wpaper:16-19&r=ure |
| By: | Anton-Erxleben, Katharina; Kibriya, Shahriar; Zhang, Yu |
| Abstract: | Worldwide, at least 20% of students are regularly bullied in school. Research from developed countries has associated bullying with several negative outcomes, but little is known about the relationship between bullying and academic achievement, especially in developing countries. Here, data from three African countries participating in the 2011 Trends in Mathematics and Sciences Study and Progress in Reading and Literacy Study were analyzed, including 36,602 participants aged 12 to 16. Results show that bullying is pervasive in all three countries, is one of the root causes of low academic performance, and is more influential than other variables commonly associated with low achievement. This indicates that school violence must become a priority for international development and country level efforts in education. |
| Keywords: | School bullying, academic achievement, Africa |
| JEL: | I12 I20 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:75555&r=ure |
| By: | Jorge Luis Garcia (The University of Chicago); James J. Heckman (The University of Chicago); Duncan Ermini Leaf (Leonard D. Schaeffer Center for Health Policy and Economics); Maria Jose Prados (Dornsife Center for Economic and Social Research) |
| Abstract: | This paper estimates the large array of long-run benefits of an influential early childhood program targeted to disadvantaged children and their families. It is evaluated by random assignment and follows participants through their mid-30s. The program is a prototype for numerous interventions currently in place around the world. It has substantial beneficial impacts on (a) health and the quality of life, (b) the labor incomes of participants, (c) crime, (d) education, and (e) the labor income of the mothers of the participants through subsidizing their childcare. There are substantially greater monetized benefits for males. The overall rate of return is a statistically significant 13.0% per annum with an associated benefit/cost ratio of 6.3. These estimates account for the welfare costs of taxation to finance the program. They are robust to a wide variety of sensitivity analyses. Accounting for substitutes to treatment available to families randomized out of treatment shows that boys benefit much less than girls from low quality alternative childcare arrangements. |
| Keywords: | childcare, early childhood education, gender differences, Health, long-term prediction, quality of life, randomized trials, substitution bias |
| JEL: | J13 I28 C93 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:hka:wpaper:2016-035&r=ure |
| By: | Sari Pekkala Kerr; William Kerr; Çaǧlar Özden; Christopher Parsons |
| Abstract: | This paper reviews recent research regarding high-skilled migration. We adopt a data-driven perspective, bringing together and describing several ongoing research streams that range from the construction of global migration databases, to the legal codification of national policies regarding high-skilled migration, to the analysis of patent data regarding cross-border inventor movements. A common theme throughout this research is the importance of agglomeration economies for explaining high-skilled migration. We highlight some key recent findings and outline major gaps that we hope will be tackled in the near future. |
| JEL: | F15 F22 J15 J31 J44 L14 L26 O31 O32 O33 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22926&r=ure |
| By: | Odolinski , Kristofer (VTI) |
| Abstract: | In this paper the cost impact of rail infrastructure usage in Sweden is estimated, using a measure of the cumulative tons experienced by the tracks since they were renewed. The cost elasticity with respect to this measure is compared to the corresponding estimate from annual tons, a standard measure of output in the literature. The cumulative ton measure generates a higher cost elasticity compared to annual tons, and is quite high for tracks that have been extensively used. The results are informative for the Swedish infrastructure manager that needs to strike a balance between maintenance and renewals; the expected cost of maintenance with respect to accumulated use can be compared to the expected cost of a renewal. |
| Keywords: | Rail infrastructure; Maintenance costs; Cumulative tons |
| JEL: | L92 R48 |
| Date: | 2016–12–09 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ctswps:2016_028&r=ure |
| By: | Ted Mouw |
| Abstract: | Empirical estimates of the effect of immigration on native workers that rely on spatial comparisons have generally found small effects, but have been subject to the criticism that out-migration by native workers dampens the observed effect by spreading it over a larger area. In contrast, studies that rely on variation in immigration across industries, occupations, or education-based skill-levels often report large negative effects, but rely primarily on repeated cross-sectional data sets which also cannot account for the adjustment of native workers over time. In this paper, we use a newly available data set, the Longitudinal Employer Household Data (LEHD), which provides quarterly earnings records, geographic location, and firm and industry identifiers for 97% of all privately employed workers in 29 states. We use this data to analyze the impact of immigration on earnings changes and the mobility response of native workers. Overall, we find that although immigration has a negative effect on the earnings and employment of native workers, and positive effects on their firm, industry, and cross-state mobility, the overall size of the effects is small. |
| Date: | 2016–01 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:16-56&r=ure |
| By: | Ghosh, Sugata; Mitra, Anirban |
| Abstract: | We study the relationship between ethnic diversity and public spending under two different political regimes, namely, democracy and dictatorship. We build a theory where political leaders (democratically elected or not) decide on the allocation of spending on different types of public goods: a general public good and an ethnically-targetable public good. We show that the relationship between public spending and ethnic diversity is qualitatively different under the two regimes. In particular, higher ethnic diversity leads to greater investment in general rather than group-specific public goods under democracy; the opposite relation obtains under dictatorship. We also discuss some implications of our results for economic performance and citizen's welfare. |
| Keywords: | Ethnic diversity, Public goods, Democracy, Dictatorship, Economic performance. |
| JEL: | D72 D74 H40 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:75546&r=ure |
| By: | Tony Addison; Amadou Boly; Anthony Mveyange |
| Abstract: | This paper investigates China’s influence on local economic development in 37 African countries between 1997 and 2007. We compare the average changes in economic growth, migration, spatial inequality, and welfare of mineral-rich districts, both prior and after China’s WTO Accession, to the corresponding changes in districts without any mineral endowment. Using this exogenous variation, we show that during 2002–07, mining activities in response to the global commodity price-boom increased welfare as measured by spatial Sen Index but were insignificant for local economic growth, migration, and spatial inequality. Our findings suggest that policy needs to do more to improve the local benefits of positive external shocks (such as China’s WTO Accession): it is not enough to assume, given Africa’s high spatial inequality, that local economies will automatically benefit from higher national growth. |
| Keywords: | mining, commodity boom, local development, Africa, China, WTO |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2016-141&r=ure |
| By: | Umair Khalil (West Virginia University, Department of Economics); Sulagna Mookerjee (Georgetown University School of Foreign Service Qatar); Ryan Tierney (Université de Montréal) |
| Abstract: | Using the unique staggered nature of the Indian General Elections, where voting takes place in several different phases spanning several weeks, we investigate how spatial variation in electoral dynamics affects subsequent voter turnout. Exploiting quasirandom assignment of constituencies to electoral phases each election, we assess the impact of average voter turnout in a given phase, on turnout in the subsequent phase. Standard endogeneity concerns in the estimation of social interactions are dealt by employing two distinct instrumental variables: 1) constituency specific average historical turnout in elections from the pre-staggered era, 2) voter density as measured by number of voters per polling location in a given constituency. Our estimates from both IVs, show that a 1 percentage point (pp) increase in turnout in a given phase depresses turnout in the subsequent phase by 0.3-0.5 pp. Crucially, falsification tests examining the effect on turnout in the current phase, of constituencies in the same phase or in future phases in the same election, produce no such effect. We find the data broadly support an ethical voter model, in which each agent acts as if setting an example for all and seek to maximize social welfare. |
| Keywords: | Voting Behavior, Staggered Elections, Election Spillovers |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:wvu:wpaper:16-21&r=ure |
| By: | Joshua R. Gubler; Joel S. Selway; Ashutosh Varshney |
| Abstract: | Recent literature has shown that crosscutting social cleavages reduce the likelihood of civil war. This article argues that the same logic does not apply to lower-scale group violence such as riots, which differ in such a way that crosscutting social cleavages should often have the opposite effect, increasing both the frequency and scale of riots. We test this argument by analysing Muslim–Christian violence in the post-Suharto era, combining a new subnational data set of ethno-income and ethnogeographic crosscuttingness with a new and comprehensive subnational data set of violence in Indonesia. Our findings suggest that high ethno-income crosscuttingness, when combined with a high degree of urban anonymity and close living quarters, is a potent setting for inter-group communal violence. We conclude with a discussion of how context matters in understanding the effect of macrostructural variables such as crosscuttingness on violence. |
| Keywords: | crosscutting cleavages, ethnicity, riots, violence, Indonesia, Muslim, Christian |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2016-129&r=ure |
| By: | Odolinski , Kristofer (VTI); Nilsson , Jan-Eric (VTI) |
| Abstract: | One cornerstone of EU’s railway policy is that track user charges should be based on marginal costs for infrastructure use. This paper updates knowledge about the marginal cost of maintaining Sweden’s railway network. Using an extended panel dataset, now comprising 16 years, we corroborate previous results using a static model framework. However, the results from the dynamic model show that an increase in maintenance cost during one year increases costs in the next year, which is contrasting previous estimates on a shorter panel dataset. We conclude that more data made a difference in a dynamic setting, but the estimated cost elasticities are rather robust in a European context. |
| Keywords: | Marginal cost; Rail infrastructure; Maintenance; Access charging; Dynamic model |
| JEL: | L92 R48 |
| Date: | 2016–12–09 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ctswps:2016_027&r=ure |
| By: | Yao Amber Li (Hong Kong University of Science and Tech); Joseph Kaboski (University of Notre Dame); Wyatt Brooks (University of Notre Dame) |
| Abstract: | Industrial clusters are generally viewed as good for growth and development, but clusters can also enable non-competitive behavior. This paper studies the presence of non-competitive pricing in geographic industrial clusters. We develop, validate, and apply a novel identification strategy for collusive behavior. We derive the test from the solution to a partial cartel of perfectly colluding firms in an industry. Outside of a cartel, markups depend on a firm’s market share but not on the total market share of firms in the agglomeration, but in the cartel, markups are constant across firms and depend only on the overall market share of the agglomeration. Empirically, we validate the test using plants with a common owner, and we then test for collusion using data from Chinese manufacturing firms (1999-2009). We find strong evidence for non-competitive pricing within a subset of industrial clusters, and we find the level of non-competitive pricing is roughly four times higher in China’s “special economic zones†. |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed016:1697&r=ure |
| By: | Amadou Boly; Robert Gillanders; Topi Miettinen |
| Abstract: | In our framed laboratory experiment, two Public Officials, A and B, make consecutive decisions regarding embezzlement from separate funds. Official B observes Official A’s decision before making their own. There are four treatments: three with deterrence and one without. We find a peer effect in embezzlement in that facing an honest Official A reduces embezzlement by Official B. Likewise, deterrence matters in that higher detection probabilities significantly decrease embezzlement. Crucially, detection is more effective in curbing embezzlement when chosen by an honest Official A compared to a corrupt Official A at almost all individual detection levels. This ‘legitimacy’ effect may help explain why anti-corruption policies can fail in countries where the government itself is believed to be corrupt. |
| Keywords: | corruption, deterrence, embezzlement, laboratory experiment, legitimacy, peer effect |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2016-137&r=ure |