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Showing papers in "Research Papers in Economics in 2011"


Posted Content
TL;DR: In this theory, the consideration of cases which are all of the same probability is insisted upon as mentioned in this paper, and what remains to be done within the framework of this theory amounts to the enumeration of all alternatives, their breakdown into equi-probable cases and their insertion into corresponding classifications.
Abstract: EVER SINCE mathematicians first began to study the measurement of risk there has been general agreement on the following proposition: Expected values are computed by multiplying each possible gain by the number of ways in which it can occur, and then dividing the sum of these products by the total number of possible cases where, in this theory, the consideration of cases which are all of the same probability is insisted upon. If this rule be accepted, what remains to be done within the framework of this theory amounts to the enumeration of all alternatives, their breakdown into equi-probable cases and, finally, their insertion into corresponding classifications…

2,347 citations


Journal Article
TL;DR: The Handbooks in the Economics of Education as discussed by the authors provides a broad overview of the state of the art in the field of education and its economic and social effects, with a focus on the value of an education.
Abstract: What is the value of an education? Volume 4 of the Handbooks in the Economics of Education combines recent data with new methodologies to examine this and related questions from diverse perspectives. School choice and school competition, educator incentives, the college premium, and other considerations help make sense of the investments and returns associated with education. Volume editors Eric A. Hanushek (Stanford), Stephen Machin (University College London) and Ludger Woessmann (Ifo Institute for Economic Research, Munich) draw clear lines between newly emerging research on the economics of education and prior work. In conjunction with Volume 3, they measure our current understanding of educational acquisition and its economic and social effects. It is the winner of a 2011 PROSE Award Honorable Mention in Economics from the Association of American Publishers. It demonstrates how new methodologies are yielding fresh perspectives in education economics. It presents topics and authors whose data and conclusions attest to the globalization of research. It complements the policy and social outcomes themes of volume 3.

1,697 citations


Posted Content
TL;DR: A recent literature has constructed top income shares time series over the long run for more than twenty countries using income tax statistics as discussed by the authors, and the estimation methods and issues that arise when constructing top income share series, including income definition and comparability over time and across countries, tax avoidance and tax evasion.
Abstract: A recent literature has constructed top income shares time series over the long run for more than twenty countries using income tax statistics. Top incomes represent a small share of the population but a very significant share of total income and total taxes paid. Hence, aggregate economic growth per capita and Gini inequality indexes are sensitive to excluding or including top incomes. We discuss the estimation methods and issues that arise when constructing top income share series, including income definition and comparability over time and across countries, tax avoidance, and tax evasion. We provide a summary of the key empirical findings. Most countries experience a dramatic drop in top income shares in the first part of the twentieth century in general due to shocks to top capital incomes during the wars and depression shocks. Top income shares do not recover in the immediate postwar decades. However, over the last thirty years, top income shares have increased substantially in English speaking countries and in India and China but not in continental European countries or Japan. This increase is due in part to an unprecedented surge in top wage incomes. As a result, wage income comprises a larger fraction of top incomes than in the past. Finally, we discuss the theoretical and empirical models that have been proposed to account for the facts and the main questions that remain open.

1,647 citations


BookDOI
TL;DR: In this article, the authors present DEA Software Tools and Technology: A State-of-the-Art Survey with DEA Estimators and their Applications in Data Envelopment Analysis.
Abstract: -Preface W.W. Cooper, L.M. Seiford, J. Zhu. -1. Data Envelopment Analysis: History, Models and Interpretations W.W. Cooper, L.M. Seiford, J. Zhu. -2. Returns to Scale in DEA: R.D. Banker, W.W. Cooper, L.M. Seiford, J. Zhu. -3. Sensitivity Analysis in DEA: W.W. Cooper, Shanling Li, L.M. Seiford, J. Zhu. -4. Incorporating Value Judgments in DEA: E. Thanassoulis, M.C. Portela, R. Allen. -5. Distance Functions with Applications to DEA R. Fare, S. Grosskopf, G. Whittaker. -6. Qualitative Data in DEA W.D. Cook. -7. Congestion: Its Identification and Management with DEA W.W. Cooper, Honghui Deng, L.M. Seiford, J. Zhu. -8. Malmquist Productivity Index: Efficiency Change Over Time K. Tone. -9. Chance Constrained DEA: W.W. Cooper, Zhimin Huang, S.X. Li. -10. Performance of the Bootstrap for DEA Estimators and Iterating the Principle: L. Simar, P.W.Wilson. -11. Statistical Tests Based on DEA Efficiency Scores R.D. Banker, R. Natarajan. -12. Performance Evaluation in Education: Modeling Educational Production J. Ruggiero. -13. Assessing Bank and Bank Branch Performance: Modeling Considerations and Approaches J.C. Paradi, S. Vela, Zijiang Yang. -14. Engineering Applications of Data Envelopment Analysis: Issues and Opportunities: K.P. Triantis. -15. Benchmarking in Sports: Bonds or Ruth: Determining the Most Dominant Baseball Batter Using DEA T.R. Anderson. -16. Assessing the Selling Function in Retailing: Insights from Banking, Sales forces, Restaurants & Betting shops A.D. Athanassopoulos. -17. Health Care Applications: From Hospitals to Physicians, From Productive Efficiency to Quality Frontiers: J.A. Chilingerian, H.D. Sherman. -18. DEA Software Tools and Technology: A State-of-the-Art Survey R. Barr. -Notes about Authors. Author Index. Subject Index.

1,462 citations


Posted Content
TL;DR: This article found that the descendants of societies that traditionally practiced plough agriculture, today have lower rates of female participation in the workplace, in politics, and in entrepreneurial activities, as well as a greater prevalence of attitudes favoring gender inequality.
Abstract: This paper seeks to better understand the historical origins of current differences in norms and beliefs about the appropriate role of women in society. We test the hypothesis that traditional agricultural practices influenced the historical gender division of labor and the evolution and persistence of gender norms. We find that, consistent with existing hypotheses, the descendants of societies that traditionally practiced plough agriculture, today have lower rates of female participation in the workplace, in politics, and in entrepreneurial activities, as well as a greater prevalence of attitudes favoring gender inequality. We identify the causal impact of traditional plough use by exploiting variation in the historical geo-climatic suitability of the environment for growing crops that differentially benefited from the adoption of the plough. Our IV estimates, based on this variation, support the findings from OLS. To isolate the importance of cultural transmission as a mechanism, we examine female labor force participation of second-generation immigrants living within the US.

1,189 citations


Posted Content
TL;DR: It is demonstrated that kindergarten test scores are highly correlated with outcomes such as earnings at age 27, college attendance, home ownership, and retirement savings, and it is documented that students in small classes are significantly more likely to attend college and exhibit improvements on other outcomes.
Abstract: In Project STAR, 11,571 students in Tennessee and their teachers were randomly assigned to classrooms within their schools from kindergarten to third grade. This article evaluates the long-term impacts of STAR by linking the experimental data to administrative records. We first demonstrate that kindergarten test scores are highly correlated with outcomes such as earnings at age 27, college attendance, home ownership, and retirement savings. We then document four sets of experimental impacts. First, students in small classes are significantly more likely to attend college and exhibit improvements on other outcomes. Class size does not have a significant effect on earnings at age 27, but this effect is imprecisely estimated. Second, students who had a more experienced teacher in kindergarten have higher earnings. Third, an analysis of variance reveals significant classroom effects on earnings. Students who were randomly assigned to higher quality classrooms in grades K–3—as measured by classmates' end-of-class test scores—have higher earnings, college attendance rates, and other outcomes. Finally, the effects of class quality fade out on test scores in later grades, but gains in noncognitive measures persist.

995 citations


Posted Content
TL;DR: The authors provides a comprehensive account of China's aid and economic cooperation overseas, explaining what the Chinese are doing, how they do it, how much aid they give, and how it all fits into their "going global" strategy.
Abstract: Is China a rogue donor, as some media pundits suggest? Or is China helping the developing world pave a pathway out of poverty, as the Chinese claim? In the last few years, China's aid program has leapt out of the shadows. Media reports about huge aid packages, support for pariah regimes, regiments of Chinese labor, and the ruthless exploitation of workers and natural resources in some of the poorest countries in the world sparked fierce debates. These debates, however, took place with very few hard facts. China's tradition of secrecy about its aid fueled rumors and speculation, making it difficult to gauge the risks and opportunities provided by China's growing embrace. This well-timed book, by one of the world's leading experts, provides the first comprehensive account of China's aid and economic cooperation overseas. Deborah Brautigam tackles the myths and realities, explaining what the Chinese are doing, how they do it, how much aid they give, and how it all fits into their "going global" strategy. Drawing on three decades of experience in China and Africa, and hundreds of interviews in Africa, China, Europe and the US, Brautigam shines new light on a topic of great interest. China has ended poverty for hundreds of millions of its own citizens. Will Chinese engagement benefit Africa? Using hard data and a series of vivid stories ranging across agriculture, industry, natural resources, and governance, Brautigam's fascinating book provides an answer. It is essential reading for anyone concerned with China's rise, and what it might mean for the challenge of ending poverty in Africa.

834 citations


Posted Content
TL;DR: Self-reported and objectively measured physical activity among U.S. adults according to the 2008 Physical Activity Guidelines for Americans (PAGA) was assessed, and physical activity estimates vary substantially depending on whether self-reported or measured via accelerometer.
Abstract: This study assesses self-reported and objectively measured physical activity among U.S. adults according to the 2008 Physical Activity Guidelines for Americans. The National Health and Nutrition Examination Survey of 2005–2006 found that fewer than 10 percent of U.S. adults met the guidelines. However, physical activity estimates vary substantially depending on how they are reported and measured.

769 citations


Posted Content
TL;DR: The economic impact of excessive alcohol consumption in the U.S. is approximately $746 per person, most of which is attributable to binge drinking, and evidence-based strategies for reducing excessive drinking should be widely implemented.
Abstract: Excessive alcohol drinking is the third leading cause of death in the United States, leading to 79,000 premature deaths annually. It is also the cause of increased disease and injury. Although the public health impacts of binge drinking are known, its economic cost has not been assessed for the United States since 1998. Using data from 2006, a new study by Mathematica assessed costs for health care, productivity losses, and other effects, including property damage, from excessive drinking. On a per-capita basis, the economic impact of excessive alcohol consumption is approximately $746 per person, mostly attributable to binge drinking.

722 citations


Posted Content
TL;DR: A discrete-choice panel analysis using 1973-2010 data suggests that domestic credit expansion and real currency appreciation have been the most robust and significant predictors of financial crises, regardless of whether a country is emerging or advanced as discussed by the authors.
Abstract: A key precursor of twentieth-century financial crises in emerging and advanced economies alike was the rapid buildup of leverage Those emerging economies that avoided leverage booms during the 2000s also were most likely to avoid the worst effects of the twenty-first century’s first global crisis A discrete-choice panel analysis using 1973-2010 data suggests that domestic credit expansion and real currency appreciation have been the most robust and significant predictors of financial crises, regardless of whether a country is emerging or advanced For emerging economies, however, higher foreign exchange reserves predict a sharply reduced probability of a subsequent crisis

712 citations


Posted Content
TL;DR: In this article, a factor model coupled with a dataset of high-frequency portfolio capital flows to 50 economies was employed to find that common shocks such as key crisis events as well as changes to global liquidity and risk have exerted a large effect on capital flows both in the crisis and in the recovery.
Abstract: The causes of the 2008 collapse and subsequent surge in global capital flows remain an open and highly controversial issue. Employing a factor model coupled with a dataset of high-frequency portfolio capital flows to 50 economies, the paper finds that common shocks – key crisis events as well as changes to global liquidity and risk – have exerted a large effect on capital flows both in the crisis and in the recovery. However, these effects have been highly heterogeneous across countries, with a large part of this heterogeneity being explained by differences in the quality of domestic institutions, country risk and the strength of domestic macroeconomic fundamentals. Comparing and quantifying these effects shows that common factors (“push” factors) were overall the main drivers of capital flows during the crisis, while country-specific determinants (“pull” factors) have been dominant in accounting for the dynamics of global capital flows in 2009 and 2010, in particular for emerging markets. JEL Classification: F3, F21, G11

Posted Content
TL;DR: In this article, the authors investigate the determinants of regional development using a newly constructed database of 1569 sub-national regions from 110 countries covering 74 percent of the world's surface and 96 percent of its GDP.
Abstract: We investigate the determinants of regional development using a newly constructed database of 1569 sub-national regions from 110 countries covering 74 percent of the world's surface and 96 percent of its GDP We combine the cross-regional analysis of geographic, institutional, cultural, and human capital determinants of regional development with an examination of productivity in several thousand establishments located in these regions To organize the discussion, we present a new model of regional development that introduces into a standard migration framework elements of both the Lucas (1978) model of the allocation of talent between entrepreneurship and work, and the Lucas (1988) model of human capital externalities The evidence points to the paramount importance of human capital in accounting for regional differences in development, but also suggests from model estimation and calibration that entrepreneurial inputs and human capital externalities are essential for understanding the data

Posted Content
TL;DR: In this article, the authors build a theoretical model of multi-product firms that highlights how competition across market destinations affects both a firm's exported product range and product mix and show how tougher competition in an export market induces a firm to skew its export sales towards its best performing products.
Abstract: We build a theoretical model of multi-product firms that highlights how competition across market destinations affects both a firm's exported product range and product mix. We show how tougher competition in an export market induces a firm to skew its export sales towards its best performing products. We find very strong confirmation of this competitive effect for French exporters across export market destinations. Theoretically, this within firm change in product mix driven by the trading environment has important repercussions on firm productivity. A calibrated fit to our theoretical model reveals that these productivity effects are potentially quite large.

Posted Content
TL;DR: This paper investigated the relationship between financial literacy and household net worth, relying on comprehensive measures of financial knowledge designed for a special module of the DNB (De Nederlandsche Bank) Household Survey.
Abstract: There is ample empirical evidence documenting widespread financial illiteracy and limited pension knowledge At the same time, the distribution of wealth is widely dispersed and many workers arrive on the verge of retirement with few or no personal assets In this paper, we investigate the relationship between financial literacy and household net worth, relying on comprehensive measures of financial knowledge designed for a special module of the DNB (De Nederlandsche Bank) Household Survey Our findings provide evidence of a strong positive association between financial literacy and net worth, even after controlling for many determinants of wealth Moreover, we discuss two channels through which financial literacy might facilitate wealth accumulation First, financial knowledge increases the likelihood of investing in the stock market, allowing individuals to benefit from the equity premium Second, financial literacy is positively related to retirement planning, and the development of a savings plan has been shown to boost wealth Overall, financial literacy, both directly and indirectly, is found to have a strong link to household wealth

Posted Content
TL;DR: In this article, the potential mechanisms through which ICT could facilitate agricultural adoption and the provision of extension services in developing countries are outlined, and a review of existing programs using ICT for agriculture, categorized by the mechanism (voice, text, internet and mobile money transfers) and the type of services provided.
Abstract: Agriculture can serve as an important engine for economic growth in developing countries, yet yields in these countries have lagged far behind those in developed countries for decades. One potential mechanism for increasing yields is the use of improved agricultural technologies, such as fertilizers, seeds and cropping techniques. Public-sector programs have attempted to overcome information-related barriers to technological adoption by providing agricultural extension services. While such programs have been widely criticized for their limited scale, sustainability and impact, the rapid spread of mobile phone coverage in developing countries provides a unique opportunity to facilitate technological adoption via information and communication technology (ICT)-based extension programs. This article outlines the potential mechanisms through which ICT could facilitate agricultural adoption and the provision of extension services in developing countries. It then reviews existing programs using ICT for agriculture, categorized by the mechanism (voice, text, internet and mobile money transfers) and the type of services provided. Finally, we identify potential constraints to such programs in terms of design and implementation, and conclude with some recommendations for implementing field-based research on the impact of these programs on farmers’ knowledge, technological adoption and welfare.

Posted Content
TL;DR: In this paper, an approach to the general structure of the rhetoric in economy is proposed, which is based on the controversy on the advantages of the free commerce between Daly and Bhagwati.
Abstract: This article offers an approach to the general structure of the rhetoric in economy. In our case we adopted a perspective to study a particular aspect of the rhetoric that comes from the context of a particular controversy: the controversy on the advantages of the free commerce between Daly and Bhagwati. It is sustained that the positions in economy present with relative frequency interest conflicts that are revealed in the dialectic one of the arguments. A proponent in open defense of the free commerce is not released of presumptions reflected in the field of the rhetoric. Reason why to include the language dimensions of the argumentation in economy has advantages for the field of the explanation and the epistemology in the social sciences.

Posted Content
TL;DR: In this paper, the authors explore the evolution of export diversification patterns along the economic development path using a large database with 156 countries over 19 years at the HS6 level of disaggregation (4'991 product lines).
Abstract: The paper explores the evolution of export diversification patterns along the economic development path. Using a large database with 156 countries over 19 years at the HS6 level of disaggregation (4’991 product lines) we look for action at the “intensive” and “extensive” margins (diversification of export values among active product lines and by addition of new product lines respectively) using various export concentration indices and the number of active export lines. We also look at new product introduction as an indicator of “export-entrepreneurship”. We find a hump-shaped pattern of export diversification similar to what Imbs and Wacziarg (2003) found for production and employment. Diversification and subsequent re-concentration take place mostly along the extensive margin, although the intensive margin follows the same pattern. This hump-shaped pattern is consistent with the conjecture that countries travel across diversification cones, as discussed in Schott (2003, 2004) and Xiang (2007).

Posted Content
TL;DR: In this paper, the power of personality traits both as predictors and as causes of academic and economic success, health, and criminal activity is explored, where the authors interpret personality as a construct derived from an economic model of preferences, constraints, and information.
Abstract: This paper explores the power of personality traits both as predictors and as causes of academic and economic success, health, and criminal activity. Measured personality is interpreted as a construct derived from an economic model of preferences, constraints, and information. Evidence is reviewed about the "situational specificity" of personality traits and preferences. An extreme version of the situationist view claims that there are no stable personality traits or preference parameters that persons carry across different situations. Those who hold this view claim that personality psychology has little relevance for economics. The biological and evolutionary origins of personality traits are explored. Personality measurement systems and relationships among the measures used by psychologists are examined. The predictive power of personality measures is compared with the predictive power of measures of cognition captured by IQ and achievement tests. For many outcomes, personality measures are just as predictive as cognitive measures, even after controlling for family background and cognition. Moreover, standard measures of cognition are heavily influenced by personality traits and incentives. Measured personality traits are positively correlated over the life cycle. However, they are not fixed and can be altered by experience and investment. Intervention studies, along with studies in biology and neuroscience, establish a causal basis for the observed effect of personality traits on economic and social outcomes. Personality traits are more malleable over the life cycle compared to cognition, which becomes highly rank stable around age 10. Interventions that change personality are promising avenues for addressing poverty and disadvantage.

Posted Content
TL;DR: In this paper, the authors examine financial literacy in the United States using the new National Financial Capability Study, and demonstrate that financial literacy is particularly low among the young, women, and the less-educated.
Abstract: We examine financial literacy in the United States using the new National Financial Capability Study, wherein we demonstrate that financial literacy is particularly low among the young, women, and the less-educated. Moreover, Hispanics and African-Americans score the least well on financial literacy concepts. Interestingly, all groups rate themselves as rather well-informed about financial matters, notwithstanding their actual performance on the key literacy questions. Finally, we show that people who score higher on the financial literacy questions are also much more likely to plan for retirement, which is likely to leave them better positioned for old-age. Our results will inform those seeking to target financial literacy programs to those in most need.

Posted Content
TL;DR: Dynare as discussed by the authors is a software platform for handling a wide class of economic models, in particular dynamic stochastic general equilibrium (DSGE) and overlapping generations (OLG) models.
Abstract: Dynare is a software platform for handling a wide class of economic models, in particular dynamic stochastic general equilibrium (DSGE) and overlapping generations (OLG) models. The models solved by Dynare include those relying on the rational expectations hypothesis, wherein agents form their expectations about the future in a way consistent with the model. But Dynare is also able to handle models where expectations are formed differently: on one extreme, models where agents perfectly anticipate the future; on the other extreme, models where agents have limited rationality or imperfect knowledge of the state of the economy and, hence, form their expectations through a learning process. Dynare offers a user-friendly and intuitive way of describing these models. It is able to perform simulations of the model given a calibration of the model parameters and is also able to estimate these parameters given a dataset. Dynare is a free software, which means that it can be downloaded free of charge, that its source code is freely available, and that it can be used for both non-profit and for-profit purposes.

Posted Content
TL;DR: This paper developed a structural economic model to interpret the evidence that 20-40 percent of tax rebates are spent on non-durable household consumption in the quarter that they are received.
Abstract: A wide body of empirical evidence, based on randomized experiments, finds that 20-40 percent of fiscal stimulus payments (e.g. tax rebates) are spent on non-durable household consumption in the quarter that they are received. We develop a structural economic model to interpret this evidence. Our model integrates the classical Baumol-Tobin model of money demand into the workhorse incomplete-markets life-cycle economy. In this framework, households can hold two assets: a low-return liquid asset (e.g., cash, checking account) and a high-return illiquid asset (e.g., housing, retirement account) that carries a transaction cost. The optimal life-cycle pattern of wealth accumulation implies that many households are "wealthy hand-to-mouth": they hold little or no liquid wealth despite owning sizable quantities of illiquid assets. They therefore display large propensities to consume out of additional income. We document the existence of such households in data from the Survey of Consumer Finances. A version of the model parametrized to the 2001 tax rebate episode is able to generate consumption responses to fiscal stimulus payments that are in line with the data.

BookDOI
TL;DR: In this paper, the authors introduce Benchmarking, Efficiency Measures and Technology, Data Envelopment Analysis DEA, Statistical Analysis in DEA, Stochastic Frontier Analysis SFA and Merger Analysis.
Abstract: 1. Introduction to Benchmarking.- 2. Efficiency Measures.- 3. Production Models and Technology.- 4. Data Envelopment Analysis DEA.- 5. Additional Topics in DEA.- 6. Statistical Analysis in DEA.- 7. Stochastic Frontier Analysis SFA.- 8. Additional Topics in SFA.- 9. Merger Analysis.- 10. Regulation and Contracting.- Appendix. Getting Started with R: A Quick Introduction.

Posted Content
TL;DR: This text is inspired from a “Cours Bachelier” held in January 2009 and taught by Jean-Michel Lasry, based upon the articles of the three authors and upon unpublished materials they developed.
Abstract: This text is inspired from a "Cours Bachelier" held in January 2009 and taught by Jean-Michel Lasry. This course was based upon the articles of the three authors and upon unpublished materials developed by the authors. Proofs were not presented during the conferences and are now available. So are some issues that were only rapidly tackled during class. The content of this text is therefore far more important than the actual "Cours Bachelier" conferences, though the guiding principle is the same and consists in a progressive introduction of the concepts, methodologies and mathematical tools of mean field games theory.

Posted Content
Abstract: This paper assesses the relationship among energy consumption, financial development, economic growth, industrialization and urbanization in Tunisia from 1971-2008. The autoregressive distributed lag bounds testing approach to cointegration and Granger causality tests are employed for the analysis. The result confirms the existence of long-run relationship between energy consumption, economic growth, financial development, industrialization and urbanization in Tunisia. Moreover, financial development, industrialization and urbanization are positively related to energy consumption especially in the long-run. Long-run bidirectional causal relationships are found between financial development and energy consumption, financial development and industrialization, and industrialization and energy consumption. Hence, sound and developed financial system which can attract investors, boost the stock market and improve the efficiency of economic activities should be encouraged in the country. Nevertheless, promoting industrialization and urbanization can never be left out from the process of development. On the other hand, the unidirectional causality from energy consumption to financial development implies that government should implement loose monetary policy which will stimulates investment activities and enhances economic growth and hence the energy consumption.

Book ChapterDOI
TL;DR: The authors discuss the proposed changes in methodology, together with the neuroeconomic critique of standard economics, and offer a response to the neuro economic critique of the standard economics. But they do not assess the contributions or promise of neuroeconomic research.
Abstract: Neuroeconomics proposes radical changes in the methods of economics. This essay discusses the proposed changes in methodology, together with the the neuroeconomic critique of standard economics. We do not assess the contributions or promise of neuroeconomic research. Rather, we offer a response to the neuroeconomic critique of standard economics. † This research was supported by grants from the National Science Foundation. We thank Drew Fudenberg and Philipp Sadowski for helpful comments and suggestions.

Posted Content
TL;DR: In this paper, a forward-to-French translation of How rich countries got rich and why poor countries stay poor is presented. But the translation is limited to the French language.
Abstract: This article is a forward to French translation of How rich countries got rich and why poor countries stay poor.

Posted Content
TL;DR: The authors decompose the variation in executive compensation and find that time invariant firm and especially manager fixed effects explain a majority of the variation of executive pay and that in many settings, it is important to include fixed effects to mitigate potential omitted variable bias.
Abstract: We study the role of firm- and manager-specific heterogeneities in executive compensation We decompose the variation in executive compensation and find that time invariant firm and especially manager fixed effects explain a majority of the variation in executive pay We then show that in many settings, it is important to include fixed effects to mitigate potential omitted variable bias Furthermore, we find that compensation fixed effects are significantly correlated with management styles (ie, manager fixed effects in corporate policies) Finally, the method used in the paper has a number of potential applications in financial economics

Report SeriesDOI
TL;DR: In this paper, a global analysis of the potential energy savings which could be found in electric motor-driven system (EMDS) is presented, and a comprehensive package of policy recommendations to help governments achieve these significant energy savings in EMDS is proposed.
Abstract: This paper is the first global analysis of the potential energy savings which could be found in electric motor- driven system (EMDS). EMDS currently accounts for more than 40% of global electricity consumption. Huge untapped energy efficiency potential was found in EMDS; around 25 % of EMDS electricity use could be saved cost-effectively, which would reduce total global electricity demand by about 10%. To date, energy efficiency opportunities with EMDS have been relatively neglected in comparison with other sustainable energy opportunities. It is crucial to scale up operations and resources committed to realizing the vast potential energy savings and this paper proposes a comprehensive package of policy recommendations to help governments achieve these significant energy savings in EMDS.

Posted Content
TL;DR: In this paper, the authors constructed the first complete database of investor losses (haircuts) in all restructurings with foreign banks and bondholders from 1970 until 2010, covering 180 cases in 68 countries.
Abstract: A main puzzle in the sovereign debt literature is that defaults have only minor effects on subsequent borrowing costs and access to credit. This paper comes to a different conclusion. We construct the first complete database of investor losses (“haircuts”) in all restructurings with foreign banks and bondholders from 1970 until 2010, covering 180 cases in 68 countries. We then show that restructurings involving higher haircuts are associated with significantly higher subsequent bond yield spreads and longer periods of capital market exclusion. The results cast doubt on the widespread belief that credit markets “forgive and forget.”

Posted Content
TL;DR: The authors use a stochastic ability-to-pay model of sovereign default in which risk-neutral investors lend to a government that displays "fiscal fatigue," because its ability to increase primary balances cannot keep pace with rising debt.
Abstract: How high can public debt rise without compromising fiscal solvency? We answer this question using a stochastic ability-to-pay model of sovereign default in which risk-neutral investors lend to a government that displays "fiscal fatigue," because its ability to increase primary balances cannot keep pace with rising debt. As a result, the government faces an endogenous debt limit beyond which debt cannot be rolled-over. Using data for 23 advanced economies over 1970-2007, we find evidence of a fiscal reaction function with these features, and use it to compute "fiscal space," defined as the difference between projected debt ratios and debt limits.