Showing papers by "Bart Hobijn published in 2009"

Lobbies and Technology Diffusion

Abstract: This paper explores whether lobbies slow down technology diffusion. To answer this question, we exploit the differential effect of various institutional attributes that should affect the costs of erecting barriers when the new technology has a technologically close predecessor but not otherwise. We implement this test using a data set that covers the diffusion of twenty technologies for 23 countries over the past two centuries. We find that each of the relevant institutional variables that affect the costs of erecting barriers has a significantly larger effect on the diffusion of technologies with a competing predecessor technology than when no such technology exists. These effects are quantitatively important. Thus, we conclude that lobbies are an important barrier to technology adoption and to development.

The CHAT Dataset

Abstract: This note accompanies the Cross‐country Historical Adoption of Technology (CHAT) dataset. CHAT is an unbalanced panel dataset with information on the adoption of over 100 technologies in more than 150 countries since 1800. We discuss the main aim of CHAT, its scope and limitations, as well as several ways in which we have used the data so far and ways to potentially use the data for other research.Suggested acknowledgment: If you use the CHAT dataset for your research, please include the following citation: "Our technology measures come from the CHAT data set which is an extension of the data set described in Comin and Hobijn (2004)."

Unemployment dynamics in the OECD

Abstract: We provide a set of comparable estimates for the rates of inflow to and outflow from unemployment for 14 OECD economies using publicly available data. We then devise a method to decompose changes in unemployment into contributions accounted for by changes in inflow and outflow rates for cases where unemployment deviates from its flow steady state, as it does in many countries. Our decomposition reveals that fluctuations in both inflow and outflow rates contribute substantially to unemployment variation within countries. For Anglo-Saxon economies we find approximately a 20:80 inflow/outflow split to unemployment variation, while for Continental European and Nordic countries, we observe much closer to a 50:50 split. Using the estimated flow rates we compute gross worker flows into and out of unemployment. In all economies we observe that increases in inflows lead increases in unemployment, whereas outflows lag a ramp up in unemployment.

The CHAT Dataset

Abstract: This note accompanies the Cross?country Historical Adoption of Technology (CHAT) dataset. CHAT is an unbalanced panel dataset with information on the adoption of over 100 technologies in more than 150 countries since 1800. The data is available for download at: http://www.nber.org/data/chat. We discuss the main aim of CHAT, its scope and limitations, as well as several ways in which we have used the data so far and ways to potentially use the data for other research. Suggested acknowledgment: If you use the CHAT dataset for your research, please include the following citation: "Our technology measures come from the CHAT data set which is an extension of the data set described in Comin and Hobijn (2004)"

Do Alternative Measures of GDP Affect its Interpretation

Abstract: Gross domestic product’s high correlation with unemployment and inflation makes it a key measure of the U.S. economy. Yet the somewhat arbitrary nature of the GDP construction process complicates interpretation and measurement of the indicator. A study of an alternative measure of GDP designed to address the published series’ limitations finds that the adjusted measure differs in its representation of the long-term trend - but not the short-term fluctuations - of GDP. The published series’ relevance as an indicator is therefore robust to some of the arbitrariness of its construction.

Do alternative measures of GDP affect its interpretation

Abstract: Gross domestic product's high correlation with unemployment and inflation makes it a key measure of the U.S. economy. Yet the somewhat arbitrary nature of the GDP construction process complicates interpretation and measurement of the indicator. A study of an alternative measure of GDP designed to address the published series' limitations finds that the adjusted measure differs in its representation of the long-term trend--but not the short-term fluctuations--of GDP. The published series' relevance as an indicator is therefore robust to some of the arbitrariness of its construction.

CONDI: A Cost-Of-Nominal-Distortions Index

Abstract: We construct a price index with weights on the prices of dierent PCE goods chosen to minimize the welfare costs of nominal distortions: a cost-of-nominal-distortions index (CONDI). We compute these weights in a multi-sector New-Keynesian model with time-dependent price setting, calibrated using U.S. data on the dispersion of price stickiness and labor shares across sectors. We …nd that the CONDI weights mostly depend on price stickiness and are less aected by the dispersion in labor shares. Moreover, CONDI stabilization leads to negligible welfare losses compared to the optimal policy and is better approximated by core rather than headline in‡ation targeting. An even better approximation of the CONDI can be obtained with an adjusted core index that covers total expenditures excluding autos, clothing, energy, and food at home, but that includes food away from home.

Loan Securitization and the Monetary Transmission Mechanism

Abstract: We examine the monetary transmission mechanism in a DSGE model with asymmetric information across financial intermediaries. Adverse selection results in a time-varying market share of individually risk-priced loans held by banks, and of securitized loans held by the secondary market. This financial market structure generates a discrete interest rate spread across the prime and subprime segment of the market, and captures some essential features of the US mortgage market. Monetary policy affects the subprime-prime loan rate spread, the distribution of interest rates across loans with different default risk, and the degree of loan securitization. We analyze the impact of conventional monetary policies and credit market policies in response to an increase in default risk, and discuss its welfare implications. In our model the impact of default risk can be interpreted as a price distortion, which is smaller the larger the degree of securitization.

Labor supply responses to changes in wealth and credit

Abstract: This Letter examines how changes in wealth and credit may be affecting household and aggregate labor supply.

CONDI: a cost-of-nominal-distortions index

Abstract: We construct a price index with weights on the prices of different PCE goods chosen to minimize the welfare costs of nominal distortions: a cost-of-nominal-distortions index (CONDI). We compute these weights in a multisector New Keynesian model with time-dependent price setting, calibrated using U.S. data on the dispersion of price stickiness and labor shares across sectors. We find that the CONDI weights mostly depend on price stickiness and are less affected by the dispersion in labor shares. Moreover, CONDI stabilization leads to negligible welfare losses compared to the optimal policy and is better approximated by core rather than headline inflation targeting. An even better approximation of the CONDI can be obtained with an adjusted core index that covers total expenditures excluding autos, clothing, energy, and food at home, but that includes food away from home.

Household Inflation Experiences in the U.S.: A Comprehensive Approach

Abstract: We present new measures of household-specific inflation experiences based on comprehensive information from the Consumer Expenditure Survey (CEX) We match households in the Interview and the Diary Surveys from the CEX to produce both complete and detailed pictures of household expenditures The resulting household inflation measures are based on a more accurate and detailed description of household expenditures than those previously available We find that our household-based inflation measures track aggregate measures such as the CPI-U quite well and that the addition of Diary Survey data induces small but significant differences in the measurement of household inflation The distribution of inflation experiences across households exhibits a large amount of dispersion over the entire sample period In addition, we uncover a significantly negative relationship between mean inflation and inflation inequality across households

Jobless recovery redux

Abstract: Although the pace of layoffs appears to be subsiding and the overall economy is showing hints of stabilization, most forecasters expect unemployment to continue to increase in coming months and to recede only gradually as recovery takes hold. In this Economic Letter, we evaluate this projection using data on three labor market indicators: worker flows into and out of unemployment; involuntary part-time employment; and temporary layoffs. We pay particular attention to how these indicators compare with data from previous episodes of recession and recovery. Our analysis generally supports projections that labor market weakness will persist, but our findings offer a basis for even greater pessimism about the outlook for the labor market. Specifically, we suggest that the relatively low level of temporary layoffs and high level of involuntary part-time workers make a jobless recovery similar to the one experienced in 1992 a plausible scenario.

CONDI: A Cost-of-Nominal-Distortions Index

Abstract: We construct a price index with weights for the prices of different PCE (personal consumption expenditures) goods chosen to minimize the welfare costs of nominal distortions. In this cost-of-nominal-distortions index (CONDI), the weights are computed in a multi-sector New Keynesian model with time-dependent price setting. The model is calibrated using U.S. data on the dispersion of price stickiness and labor shares across sectors. We find that the CONDI weights depend mostly on price stickiness and are less affected by the dispersion in labor shares. Moreover, CONDI stabilization closely approximates the optimal monetary policy and leads to negligible welfare losses. Finally, CONDI is better approximated by targeting core inflation rather than headline inflation - and is even better approximated with an adjusted core index that covers total expenditures excluding autos, clothing, energy, and food at home, but including food away from home.