The theory of precautionary saving is shown in this paper to be isomorphic to the Arrow-Pratt theory of risk aversion, making possible the application of a large body of knowledge about risk aversion to precautionary saving, and more generally, to the theory of optimal choice under risk In particular, a measure of the strength of precautionary saving motive analogous to the Arrow-Pratt measure of risk aversion is used to establish a number of new propositions about precautionary saving, and to give a new interpretation of the Oreze-Modigliani substitution effect

Precautionary Saving in the Small and in the Large

This paper evaluates the impact of an R&D subsidy program implemented in a region of northern Italy on innovation by beneficiary firms. In order to verify whether the subsidies enabled firms to increase patenting activity, we exploit the mechanism used to allot the funds. Since only projects that scored above a certain threshold received the subsidy, we use a sharp regression discontinuity design to compare the number of patent applications, and the probability of submitting one, of subsidized firms with those of unsubsidized firms close to the cut-off. We find that the program had a significant impact on the number of patents, more markedly in the case of smaller firms. Our results show that the program was also successful in increasing the probability of applying for a patent, but only in the case of smaller firms.

The Impact of R&D Subsidies on Firm Innovation

Each year, graduate students entering the academic job market worry that they will suffer due to uncontrollable macroeconomic risk. Given the importance of general human capital and the relative ease of publicly observing productivity in academia, one might expect that long-term labor market outcomes for students graduating in unfavorable climates will resemble long-term outcomes for those graduating in favorable climates. In this paper, I analyze the relationship between macroeconomic conditions at graduation, initial job placement, and long-term outcomes for Ph.D. economists from seven programs. Using macroeconomic conditions as an instrument for initial placement, I show that a quality and type of initial job have a causal effect on long-term job characteristics. I also show that better initial placement increases research productivity, which helps to limit the set of economic models that can explain the effect of initial placement on long-term jobs.

https://pubs.aeaweb.org/doi/pdfplus/10.1257/jep.20.3.143

Initial Labor Market Conditions and Long-Term Outcomes for Economists

http://static.gest.unipd.it/~birolo/didattica11/Materiale_2012/Letture/Materiale_per_studenti_2012/_Innovazione:Dati%20statistici%20e%20analisi%20empiriche/Bronzini-The%20impact%20of%20RD%20subsides%20on%20firm%20innovation.pdf

The impact of R&D subsidies on firm innovation

We examine the impact of natural disasters on GDP per capita by applying the synthetic control approach Our analysis encompasses two large-scale earthquakes that occurred in two different Italian regions in 1976 and 1980 We show that the short-term effects are negligible in both regions, though they become negative if we simulate the GDP that would have been observed in absence of financial aid In the long-term, our findings indicate a positive effect in one case and a negative effect in the other, largely reflecting divergent patterns of the TFP Consistently with these findings, we offer further evidence suggesting that a quake and related financial aids might either increase technical efficiency via a disruptive creation mechanism or reduce it by stimulating corruption, distorting the markets and deteriorating social capital We finally show that the bad outcome is more likely to occur in areas with lower pre-quake institutional quality As a result, our evidence suggests that natural disasters are likely to exacerbate differences in economic and social development

/pdf/natural-disasters-growth-and-institutions-a-tale-of-two-263nj2eubu.pdf

Natural Disasters, Growth and Institutions: A Tale of Two Earthquakes

Reshaping the schooling system: The role of immigration

A number of specific conclusions and recommendations have emerged from my discussion of readily available data. But such data remain scanty. More research is needed on almost every point touched here. I invite the EEA to promote such research, in the same way that it did earlier for rankings of economics departments. Just running down the list of items above on which I did advocate further work provides the starting point of a research program.

/pdf/research-and-higher-education-in-economics-can-we-deliver-5fej5m8h0j.pdf

Research and Higher Education in Economics: Can We Deliver the Lisbon Objectives?

https://www.cerge-ei.cz/pdf/events/papers/070319_t.pdf

Mortality risks, education and child labor

In this paper, we examine an innovative affirmative action policy designed to increase the representation of underprivileged students at UNICAMP, a large and highly ranked Brazilian university. The university awarded bonus points to targeted applicants (i.e., public high school applicants) on their admission exam, as opposed to imposing a typical quota system. Using a rich set of administrative data from UNICAMP, we assess the effect of this policy on the composition of admitted students, and investigate for possible behavioral responses at the extensive (participation) and intensive (preparation effort) margins. We find that the admission probability of public high school applicants, the targeted applicants, significantly increased following the adoption of the affirmative action program. The policy was also associated with sizable redistribution in the composition of admitted students, with a shift towards students from families with lower socio-economic status. Surprisingly, we find little evidence of behavioral reactions to the affirmative action policy, in terms of test performance or application decision.

/pdf/redistribution-without-distortion-evidence-from-an-4a56jl3jke.pdf

Redistribution without distortion: evidence from an affirmative action program at a large Brazilian university

/pdf/research-and-higher-education-in-economics-can-we-deliver-18a83nryqu.pdf

Fernanda Estevan

Papers

Reshaping the schooling system: The role of immigration

Research and Higher Education in Economics: Can We Deliver the Lisbon Objectives?

Mortality risks, education and child labor

Redistribution without distortion: evidence from an affirmative action program at a large Brazilian university

Research and higher education in economics: can we deliver the lisbon objectives?