Showing papers in "Economica in 2009"
TL;DR: This paper examined what determines differences across countries and over time in the distribution of personal incomes in the OECD and found that strong unions and/or a more generous unemployment benefit tend to reduce inequality through reduced wage differentials, a higher labour share, and also higher unemployment.
Abstract: We examine what determines differences across countries and over time in the distribution of personal incomes in the OECD. We first model the wage determination process and show that unemployment, the labour share, and the wage differential are all functions of labour market institutions. Next we show that in a model economy with only four types of agents – capitalists, skilled and unskilled workers, and unemployed – the Gini coefficient of personal incomes can be expressed as a function of the above three variables. Labour market institutions hence affect income inequality, though the sign of their impact is ambiguous. Stronger unions and/or a more generous unemployment benefit tend to reduce inequality through reduced wage differentials, a higher labour share, and also higher unemployment. We then use a panel of OECD countries for the period 1970-96 to examine these effects. We find, first, that the labour share remains an important aspect of overall inequality patterns, and, second, that stronger unions and a more generous unemployment benefit tend to reduce income inequality. High capital-labour ratios also emerge as a strong equalising factor, which has in part offset the impact of increasing wage inequality on the US distribution of personal incomes.
269 citations
TL;DR: This paper investigated the relationship between part-time work and family wellbeing and found that women are more satisfied with working hours than full-time women, and that women's life satisfaction is increased if their partners work full time.
Abstract: Taking into account interdependence within the family, we investigate the relationship between part-time work and family wellbeing. We use panel data from the Household, Income and Labor Dynamics in Australia (HILDA) Survey. We find that part-time women are more satisfied with working hours than full-time women, and that women's life satisfaction is increased if their partners work full-time. Male partners' life satisfaction is unaffected by their partners' market hours but is increased if they themselves are working full-time. Our results are consistent with the gender identity hypothesis.
206 citations
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TL;DR: In this article, a new model of endogenous technological change, viewed as the product of a class of problem-solving producers, is proposed, based on the premise that all knowledge resides in the head of some individual person and the knowledge of a firm, or economy, or any group of people is simply the individual knowledge of the individuals that comprise it.
Abstract: This paper introduces and partially develops a new model of endogenous technological change, viewed as the product of a class of problem-solving producers. The model, based on earlier work by Eaton and Kortum, is built up from the premise that all knowledge resides in the head of some individual person and the knowledge of a firm, or economy, or any group of people is simply the knowledge of the individuals that comprise it. The model is applied to an economy with a cohort structure. A calibration of the model using cross-section earnings data, in addition to aggregate GDP growth, is considered. What is it about modern capitalist economies that allows them, in contrast to all earlier societies, to generate sustained growth in productivity and living standards? It is widely agreed that the productivity growth of the industrialized economies is mainly an ongoing intellectual achievement, a sustained flow of new ideas. Are these ideas the achievements of a few geniuses, Newton, Beethoven and a handful of others, viewed as external to the activities of ordinary people? Are they the product of a specialized research sector, engaged in the invention of patent-protected processes over which they have monopoly rights? Both images are based on important features of reality and both have inspired interesting growth theories, but neither seems to me central. What is central, I believe, is the fact that the industrial revolution involved the emergence (or rapid expansion) of a class of educated people, thousands - now many millions - of people who spend entire careers exchanging ideas, solving work-related problems, generating new knowledge. In this paper I introduce and partially develop a new model of technological change, viewed as the product of a class of problem-solving producers. The model is built up from the premise that all knowledge resides in the head of some individual person, so that the knowledge of a firm, or economy, or any group of people is simply a list of the knowledge of its members. A main feature of the model will be the social or reciprocal character of intellectual activity: Each person gains from the knowledge of the people around him; his ideas in turn stimulate others.1 As we will see, this idea is very flexible, but to develop it we need to have a tractable mathematical idealization of an individual's knowledge, of the relation of this knowledge
171 citations
TL;DR: In this paper, the authors study the impact of macroeconomic environment on business exit in a world where acquisition and bankruptcy are co-determined, and find that the processes determining bankruptcycies and acquisitions depend on the macro economic environment.
Abstract: We study the impact of the macroeconomic environment on business exit in a world where acquisition and bankruptcy are co-determined. We estimate competing risk hazard regression models using data on UK quoted firms spanning a 38-year period that witnessed several business cycles. We find that the processes determining bankruptcies and acquisitions depend on the macroeconomic environment. In particular, macroeconomic instability has opposing effects on bankruptcy hazard and acquisition hazard, raising the former and lowering the latter. While bankruptcy hazard is counter-cyclical and acquisition hazard pro-cyclical, the US business cycle is a better predictor than the UK cycle itself.
141 citations
TL;DR: In this article, the authors demonstrate by example how prediction markets make it possible to use markets to prospectively estimate policy effects, showing that a 10% increase in the probability of war was accompanied by a $1 increase in spot oil prices that futures markets suggested was expected to dissipate quickly.
Abstract: Financial market-based analysis of the expected effects of policy changes has traditionally been exclusively retrospective. In this paper, we demonstrate by example how prediction markets make it possible to use markets to prospectively estimate policy effects. We exploit data from a market trading in contracts tied to the ouster of Saddam Hussein as leader of Iraq to learn about financial market participants' expectations of the consequences of the 2003 Iraq war. We conducted an ex-ante analysis, which we disseminated before the war, finding that a 10% increase in the probability of war was accompanied by a $1 increase in spot oil prices that futures markets suggested was expected to dissipate quickly. Equity price movements implied that the same shock led to a 1.5% decline in the S&P 500. Further, the existence of widely-traded equity index options allows us to back out the entire distribution of market expectations of the war's near-term effects, finding that these large effects reflected a negatively skewed distribution, with a substantial probability of an extremely adverse outcome. The flow of war-related news through our sample explains a large proportion of daily oil and equity price movements. Subsequent analysis suggests that these relationships continued to hold out of sample. Our analysis also allows us to characterize which industries and countries were most sensitive to war news and when the immediate consequences of the war were better than ex-ante expectations, these sectors recovered, confirming these cross-sectional implications. We highlight the features of this case study that make it particularly amenable to this style of policy analysis and discuss some of the issues in applying this method to other policy contexts.
134 citations
TL;DR: The authors found that the price of high-density food is negatively related to adolescent body weight, whereas price of low density food is positively related, and that most of the changes in body weight occur in the top quintile of the conditional distribution of BMI.
Abstract: foods increase body weight if the price of obtaining a calorie from dense food is lower than that of less dense food. Estimates of the determinants of adolescent BMI suggest that the price of high-density food is negatively related to BMI whereas the price of low density food is positively related. Restaurant availability is not associated with weight, but increases in supermarket density predict lower weight. Quantile regressions show that most of the changes in body weight occur in the top quintile of the conditional distribution of BMI.
123 citations
TL;DR: In this article, the authors measured trust using both survey questions and a trust experiment among a random sample of Muslim and Hindu household heads in rural Bangladesh and found no significant effect of the social distance between Hindus and Muslims in the trust experiment in terms of the proportions sent or returned.
Abstract: Trust is measured using both survey questions and a trust experiment among a random sample of Muslim and Hindu household heads in rural Bangladesh. We found no significant effect of the social distance between Hindus and Muslims in the trust experiment in terms of the proportions sent or returned. However, the survey responses do indicate significant differences. Both Hindus and Muslims were found to trust others from their own religion more than they trust people from other religions. Moreover, Hindus, the minority, trust other people less in general, and Hindus trust Muslims more than Muslims trust Hindus.
119 citations
TL;DR: In this article, the first field experiment studying discrimination against homosexuals on the housing market is presented, where two fictitious couples, one heterosexual and one male homosexual, apply for vacant rental apartments advertised by landlords on the internet.
Abstract: This paper presents the first field experiment studying discrimination against homosexuals on the housing market. The study is conducted on the rental housing market in Sweden using the internet as a research platform. Two fictitious couples, one heterosexual and one male homosexual, apply for vacant rental apartments advertised by landlords on the internet. Our findings show that homosexual males are discriminated against on the Swedish housing market, since the homosexual couple gets far fewer call-backs and fewer invitations to further contacts and to showings of apartments than the heterosexual couple.
112 citations
TL;DR: The relationship between theory and reality was discussed in this article, where two examples of inappropriate relationships were taken from monetary economics were taken: (1) IS/LM: whereby the monetary authorities set the monetary base, and the interest rate is market determined; (2) the monetary multiplier of bank deposits and the role of reserve ratios; (3) the current three-equation neoclassical consensus, assuming perfect creditworthiness, and hence no need for banks; and (4) the analysis of the evolution of money.
Abstract: Lionel Robbins was concerned about the methodology of economic science. When he discussed the relationship between theory and ‘reality’, two of the examples of inappropriate relationships were taken from monetary economics. Such shortcomings continue. Among the worst are:
(1) IS/LM: whereby the monetary authorities set the monetary base, and the interest rate is market determined;
(2) the monetary base multiplier of bank deposits, and the role of reserve ratios;
(3) the current three-equation neoclassical consensus, assuming perfect creditworthiness, and hence no need for banks;
(4) the analysis of the evolution of money.
111 citations
TL;DR: The authors traces the reception, diffusion and contesting of the Robbins definition, arguing that this process took around three decades and that even then there was still significant dissent, and that the definition itself and the developments that it has been used to support were keenly contested.
Abstract: Robbins' Essay gave economics a definition that came to dominate the professional literature. This definition laid a foundation that could be seen as justifying both the narrowing of economic theory to the theory of constrained maximization or rational choice and economists' ventures into other social science fields. Though often presented as self-evidently correct, both the definition itself and the developments that it has been used to support were keenly contested. This paper traces the reception, diffusion and contesting of the Robbins definition, arguing that this process took around three decades and that even then there was still significant dissent.
92 citations
TL;DR: In this article, the authors adapt a market microstructure model to this case, adding a manipulator with an additional quadratic preference regarding the price, and when other traders are uncertain about the manipulator's target price, the mean target price has no effect on prices, and raising the variance of the target price can increase average price accuracy.
Abstract: Prediction markets are low volume speculative markets whose prices offer informative forecasts on particular policy topics. Observers worry that traders may attempt to mislead decision makers by manipulating prices. We adapt a Kyle-style market microstructure model to this case, adding a manipulator with an additional quadratic preference regarding the price. In this model, when other traders are uncertain about the manipulator's target price, the mean target price has no effect on prices, and raising the variance of the target price can increase average price accuracy, by boosting the returns to informed trading and thereby incentives for traders to become informed.
TL;DR: The authors argue that it is a legitimate exercise of economic analysis to examine the consequences of different ethical positions, taking case studies of employment as a macroeconomic objective, and the role of capabilities in the measurement of economic performance.
Abstract: Economists frequently make judgments about economic welfare, but there is today little discussion of the foundations of welfare economics. It is assumed either that there is unanimity of interests, or that there is general acceptance of utilitarianism. This means that economics cannot address many key policy issues and that important differences in ethical views cannot be recognized. This paper argues that it is a legitimate exercise of economic analysis to examine the consequences of different ethical positions, taking case studies of employment as a macroeconomic objective, and the role of capabilities in the measurement of economic performance.
TL;DR: In this article, a model to explain how parental care responsibilities and family structure interact in affecting children?s mobility characteristics was proposed, and the authors found that the mobility of young adults crucially depends on the presence of a sibling.
Abstract: In most industrialized countries, more people than ever are having to cope with the burden of caring for elderly parents. This paper formulates a model to explain how parental care responsibilities and family structure interact in affecting children?s mobility characteristics. A key insight we obtain is that the mobility of young adults crucially depends on the presence of a sibling. Our explanation is mainly, but not exclusively, based on a sibling power effect. Siblings compete in location and employment decisions so as to direct parental care decisions at later stages towards their preferred outcome. Only children are not exposed to this kind of competition. This causes an equilibrium in which siblings not only exhibit higher mobility than only children, but also have better labor market outcomes. Using data from the German Socio-Economic Panel Study (SOEP) and from the American National Survey of Families and Households (NSFH), we find strong evidence that confirms these patterns. The implications of our results are then discussed in the context of current population trends in Europe and the United States.
TL;DR: In the last five years, however, the region has experienced a new wave of resource nationalism, with increases in the government's take and state control in the oil and gas sector in Latin America.
Abstract: 1990s witnessed a significant increase in investments in the oil and gas sector in Latin America. In most countries, private investment took the lead after the privatization and liberalization of the sector. In Argentina, Bolivia, Brazil, Ecuador, and Venezuela, private oil investment or some form of privatization (or both) generated significant increases in hydrocarbon production and reserves. In the last five years, however, the region has experienced a new wave of resource nationalism, with increases in the government's take and state control. Oil taxes have risen significantly in Argentina, Bolivia, Ecuador, and Venezuela. In addition, Bolivia and Venezuela have partially nationalized oil projects. We argue that the recent trend is largely the outcome of the rise in the international oil price. Furthermore, we show how the likelihood of expropriation increased after a period of successful investment in exploration and production. At the same time, the timing of these changes and direction in which the sector has evolved varies considerably across the region. In contrast to most other countries in the region, Brazil, Colombia, and Peru have generally strengthened the institutional framework and the property rights of private oil producers. This paper provides a political economy rationale for the divergent evolution.
TL;DR: In this article, the authors investigate whether outside private investors have useful information about proposed SBIR projects' prospects for commercialization and suggest that they do, thereby providing support for the possibility that a prediction market could improve the performance of the Small Business Innovation Research (SBIR).
Abstract: An objective of the US Small Business Innovation Research (SBIR) programme is the private sector commercialization of funded RD our analysis of Department of Defense (DoD) Phase II awards suggests that the estimated probability of commercialization is only 0.47. We investigate econometrically whether outside private investors have useful information about proposed SBIR projects' prospects for commercialization. Our findings suggest that they do, thereby providing support for the possibility that a prediction market could improve the performance of the SBIR programme.
TL;DR: The authors examined the decision to extract home equity using household-level data for the UK over 1993-2003 and found that the equity withdrawal decision conforms to predictions from the standard life-cycle framework and models that predict its use as a financial buffer.
Abstract: The decision to extract home equity is examined using household-level data for the UK over 1993–2003. At its peak during the period, around 1-in-10 homeowners withdraw equity per year. Little is known about this financial decision. I find that the equity withdrawal decision conforms to predictions from the standard life-cycle framework and models that predict its use as a financial buffer. The paper also estimates responses to the large house price appreciation and significant reductions in mortgage rates seen during the period.
TL;DR: This paper explored the probability of being employed, unemployed, and not in the labour force, for men and women in same-sex couples and married and unmarried opposite-sex couple, and found that women were more likely to be unemployed than men.
Abstract: This study explores the probabilities of being employed, unemployed, and not in the labour force, for men and women in same-sex couples and married and unmarried opposite-sex couples. Same-sex partners were more likely to be unemployed than married opposite-sex partners but less likely than unmarried oppositesex partners. Laws prohibiting sexual orientation discrimination had positive and larger effects on unemployment for same-sex partners than for other partners. The presence of young children increased the probability of being out of the labour force more for male same-sex partners than for other men, and less for female same-sex partners than for other women.
TL;DR: This paper showed that exposure to trade raises output volatility through the terms-of-trade channel as previously documented in the literature, but also show that this is counteracted by a quantitatively larger stabilizing effect.
Abstract: Many economists believe that, while openness to trade increases average GDP growth rates, it also raises output volatility by exposing countries to terms-oftrade shocks. This view does not take into account that commercial trade might also reduce financially related volatility. Once this is taken into account, the relationship between exposure to trade and output volatility is still an open question. This paper presents new empirical evidence that suggests that the net effect of trade openness on output volatility is stabilizing. The results confirm that exposure to trade raises output volatility through the terms-of-trade channel as previously documented in the literature, but also show that this is counteracted by a quantitatively larger stabilizing effect. Additional evidence is presented showing that the latter effect comes (at least in part) through the financial channel. The methodology employed seeks to correct for the likely endogeneity of trade in this setting using gravity estimates as instrumental variables.
TL;DR: In this article, the authors investigate intergenerational risk-sharing in two-pillar pension systems with a pay-as-you-go pillar and a funded pillar, and show how the pension system affects capital markets in general and the equity premium in particular.
Abstract: We investigate intergenerational risk-sharing in two-pillar pension systems with a pay-as-you-go pillar and a funded pillar. The funded pension pillar can be either defined contribution or defined benefit. Only a defined-benefit scheme with an appropriate investment policy establishes optimal intergenerational risk-sharing. We show how the pension system affects capital markets in general and the equity premium in particular.
TL;DR: In this article, the authors examined the impact of acquisitions by UK acquirers on executive pay and found that good and bad acquisitions do not increase CEO wealth because CEO shareholding value declines.
Abstract: This paper examines the impact of acquisitions by UK acquirers on executive pay. The overall sample shows a significant transitory pay increase. Pay changes are not affected by target nationality or organizational form, although initial cross-border acquisitions result in higher pay. Pay increases are higher following acquisitions of targets with high pay, but not high-pay countries. CEOs are rewarded equally for bad and good acquisitions, and those well rewarded are more likely to re-acquire. However, bad acquisitions do not increase CEO wealth because CEO shareholding value declines. Pay impacts are not affected by the acquiring firms’ strength of corporate governance.
TL;DR: In this article, the authors investigated the relationship between firms' financial constraints and monetary policy for the United Kingdom, using a large panel of UK firms in manufacturing over the period 1970-91.
Abstract: This paper examines the cash flow sensitivity of investment using a panel of UK manufacturing firms to investigate the existence of a balance sheet channel. In addition to examining the impact of cash flow in different subsamples based on company size or financial policy, we investigate the extent to which investment becomes more sensitive to cash flow in periods of monetary tightness by employing a narrative indicator constructed for the United Kingdom. The results indicate that cash flow sensitivity in financially constrained firms is higher during periods of tight monetary policy and that financial constraints weaken with financial market sophistication. to investigate the relationship between firms' financial constraints and monetary policy for the United Kingdom, using a large panel of UK firms in manufacturing over the period 1970-91. We initially establish that cash flow has a different effect on investment in different subsamples depending on company size or financial policy (dividend payouts and share issues as well as leverage), something that is well established in the literature. The main contribution of this paper is an investigation of the extent to which investment becomes even more sensitive to cash flow in periods of monetary tightness. This is an under-researched area, yet one that provides important information about both the dynamic nature of financing constraints and monetary transmission. To this end, we employ a monetary tightness indicator constructed for the United Kingdom using the narrative approach pioneered by Romer and Romer (1989). The second contribution of the paper, therefore, is that this is the first time such an index has been constructed for the United Kingdom and used to test for the balance sheet channel. In the light of the criticisms of the approach used in the literature on financial constraints, a final contribution of the paper is an extensive analysis of the robustness of the results. Our results provide support for the view that, using firm size and firm financial policy to classify companies, financially constrained firms in the United Kingdom display
TL;DR: A battery of field experiments containing the trust game, the voluntary contribution mechanism, and the risk-pooling game, which was applied in six capital cities in Latin America, was used to explore the extent to which individuals trust, reciprocate, cooperate, and pool risk as discussed by the authors.
Abstract: This paper explores the extent to which individuals trust, reciprocate, cooperate, and pool risk. We use a battery of field experiments containing the trust game, the voluntary contribution mechanism, and the risk-pooling game, which we apply in six capital cities in Latin America. A salient feature of the paper is that the data is representative of the population from the six cities: Bogota, Buenos Aires, Caracas, Montevideo, Lima, and San Jose. The results support three findings: the propensity to trust and cooperate among Latin Americans is, on average, remarkably similar to that found in other regions of the world; expectations about the behavior of other players are the main driver of trust, reciprocity. and cooperation; and the behaviors associated with socialization, trust, and cooperation are strongly linked among them.
TL;DR: In this paper, the authors investigate the role of knowledge in the life cycle of the German automobile industry during the period 1886-1939 and find that knowledge acquired before entry, post-entry, and innovative activity had a significant impact on the survival of German automobile firms.
Abstract: The paper investigates how pre-entry experience, post-entry experience and innovative activity affected the survival of German automobile firms over the period 1886-1936. A statistical survival analysis is performed which links instrumental variable estimation with the Cox regression. The main results are that all three knowledge components exert an independent and significantly positive effect on firm survival. Moreover, innovative activity is able to compensate for post-entry experience, in accord with Schumpeterian creative destruction. The industry life cycle describes how the number of firms in an industry evolves from birth to maturity. This evolution is driven by entry and exit dynamics and hence by the success and failure of firms. Analysing this dynamic pattern raises the question of why entry, so prominent in early phases of the industry life cycle, ceases at some point in time, and seeks an identification of the forces driving firm exit. In theoretical models of industry evolution such as Klepper (1996, 2002a), knowledge (in different forms) is considered the main driving force shaping the life cycle pattern. These models distinguish three components of knowledge: (i) knowledge acquired before entry (pre-entry experience), (ii) knowledge acquired after entry (post-entry experience) and (iii) knowledge acquired in the course of innovative activity (innovative experience). Empirical analyses of the life-cycle pattern focus entirely on the investigation of the exit dynamics. Statistical methods for survival analysis are used to relate the knowledge components to the exit risk of firms in terms of the hazard rate (defined as the probability of exit, given that the firm has survived so far). The most appropriate way to implement this kind of empirical analysis is to study single narrowly defined industries. With respect to pre- and post-entry experience, this has been done by Buenstorf (2005), Buenstorf and Klepper (2005), Klepper (2002a), Klepper and Simons (2005) and Thompson (2005) for various industries. The automobile industry has been studied by Boschma and Wenting (2007), Cantner et ai (2006) and Klepper (2002a, b, 2007) for the British, German, and US cases, respectively. Within the same framework, innovative experience has been investigated by Klepper and Simons (2005). A major advantage of these studies is that they track a single industry's entire life cycle from birth to maturity. In contrast, other duration analyses in industrial economics focus on firms sampled together, irrespective of the industry of origin, over rather short time spans. The works of Audretsch and Mahmood (1993, 1994, 1995) are exemplary in this respect. In this paper we investigate the role of knowledge in the life cycle of the German automobile industry during the period 1886-1939. A comprehensive data-set of German automobile producing firms has been assembled for this purpose. This data-set records the entry and exit dates of the firms, their experience before they entered the market and their innovative activity in terms of patent grants. The econometric analysis of the patent data is faced with a potential simultaneity problem, which we approach with a combination of (£) The London School of Economics and Political Science 2008
TL;DR: This paper examined the effect on human capital accumulation of three basic education finance policies and found that policies directed at enhancing the productivity of education or making degrees more informative are more successful at improving educational outcomes.
Abstract: We build a model where homogeneous workers can accumulate human capital by investing in education. Schools combine public resources and individual effort to generate productive skills. If skills are imperfectly compensated, then in equilibrium students may under-invest in effort. We examine the effect on human capital accumulation of three basic education finance policies. Increased tuition subsidies may not be beneficial because they increase enrolment but they may lower the incentives for student achievement, hence the skill level. Policies directed at enhancing the productivity of education or making degrees more informative are more successful at improving educational outcomes.
TL;DR: In this paper, the authors examined the effects of the expansion of the water network in urban shantytowns in Argentina and found large reductions in the presence, frequency and severity of diarrhoea episodes among children reached by network expansions relative to a control group.
Abstract: This paper examines the effects of the expansion of the water network in urban shantytowns in Argentina. We find large reductions in the presence, frequency and severity of diarrhoea episodes among children reached by network expansions relative to a control group. Moreover, expanded connections induce savings in water expenditures, as these families are able to substitute piped water for more expensive and distant sources of water provision. These health and savings effects are also important for households that previously had clandestine self-connections to the water network, which were free but of low quality.
TL;DR: In this article, the implications of school choice in the context of the Chilean quasivoucher system were studied, and it was shown that overall, school choice seems to be valuable to households, but there is a lot of heterogeneity in its value.
Abstract: This paper studies the implications of school choice in the context of the Chilean quasivoucher system. We use information of school choices of about 80,000 students that lived in the Metropolitan Area of Santiago in Chile in 2002 and the results of the discrete choice model estimated in Gallego and Hernando (2008) to perform a number of exercises aimed at quantifying what we call the �value of choice� (i.e. how much do households gain from a school choice system?) against a number of counterfactuals that restrict school choice in several dimensions (geographic choice, the existence of top ups, and the supply of voucher schools).
We also (i) analyze the effects on socioeconomic segregation of students and (ii) study the potential effects of introducing a non-flat voucher that is decreasing in students� SES.
Our results suggest that overall, school choice seems to be valuable to households, but there is a lot of heterogeneity in its value. In some simulations, school choice is regressive (as when lotteries are used to allocate students to current schools; or when we consider the effects of the increase in the supply of voucher schools) and in other progressive (when students are allowed to choose outside the county in which they live). Interestingly, policies that restrict the use of top ups to the voucher do not seem to reduce segregation in a significant way. This contrasts with the introduction of a differentiated voucher, which would mostly benefit the poor and even compensate them for loses from some dimensions of school choice observed in particular groups
TL;DR: The authors explored the link between changes in house prices and household indebtedness in the United Kingdom and found that households which are borrowing-constrained by a lack of housing equity as collateral make greater use of unsecured debt such as credit cards or personal loans.
Abstract: We use household panel data to explore the link between changes in house prices and household indebtedness (both secured on housing assets and unsecured) in the United Kingdom. We show that households which are borrowing-constrained by a lack of housing equity as collateral make greater use of unsecured debt such as credit cards or personal loans. In response to rising house prices, which relax this constraint, such households are more likely to refinance and to increase their indebtedness relative to unconstrained households. However, for most households, house price movements appear to have little impact on indebtedness.
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TL;DR: The authors testa-se a hipotese de que existe efeito inercia" nas taxas de crimes violentos letais e intencionais nos estados brasileiros.
Abstract: Utilizando o estimador system GMM (Arellano e Bover 1995; Blundell e Bond 1998), neste artigo, testa-se a hipotese de que existe efeito inercia" nas taxas de crimes violentos letais e intencionais nos estados brasileiros. Estima-se que, aproximadamente, metade da criminalidade de um periodo se transfere para o proximo, alimentando as altas taxas de crimes letais no Brasil. Os resultados aprofundam a discussao sobre o efeito dissuasorio dos gastos com seguranca publica ja que, mais uma vez, esse efeito nao e observado. Felizmente, porem, aumentar a escolaridade parece ser uma das formas de diminuir a taxa de crimes letais nos estados brasileiros.
TL;DR: In this article, the authors model inter-household transfers between nomadic livestock herders as the state-dependent consequence of individuals' strategic interdependence, resulting from the existence of multiple, opposing externalities.
Abstract: We model inter-household transfers between nomadic livestock herders as the state-dependent consequence of individuals' strategic interdependence, resulting from the existence of multiple, opposing externalities—more specifically, a public-good security externality among individuals sharing a social (e.g. ethnic) identity in a potentially hostile environment, and a resource appropriation externality related to the use of common property grazing lands. Our model augments the extant literature on transfers, and is more consistent with the limited available empirical evidence on heterogeneous and changing transfers' patterns among east African pastoralists. The core principles of our model possibly apply more broadly, for example to long-distance migrants or even ‘foot soldiers’ in street gangs.
TL;DR: In 2006 and 2007, a sample of 380 alumni of the 1971 cohort, thirty years after their 1977 graduation in schools both with and without longer days, were interviewed and found both positive and negative impacts of double shift primary schools as discussed by the authors.
Abstract: In 1971, longer school days were decreed for around half the public primary schools in the city of Buenos Aires, Argentina. Since participating schools were chosen roughly at random, an unusual opportunity for a natural experiment was created. In 2006 and 2007, we interviewed a sample of 380 alumni of the 1971 cohort, thirty years after their 1977 graduation in schools both with and without longer days. The main results are as follows. Students that attended double-shift (DS) primary schools had secondary school graduation rates 21 percent higher than those that attended single-shift primary schools. This result is mainly explained by what happened with the students with low socioeconomic status. Regarding tertiary and postgraduate educational levels, we have found both positive and negative impacts of DS. These last results, taken together with the absence of enduring effects of DS on income and employment and with the fact that DS students do not have a better knowledge of a second language, in spite of having had it as a subject in the school, suggest that the quality of the content and learning in DS schools was not good. These findings are very relevant when considering the extension of DS to other schools or to the whole educational system.