Showing papers on "Negative relationship published in 2008"
TL;DR: The authors explored the relationship between financialization in the U.S economy and real investment at the firm level and found a negative relationship between real investment and financialization, which may have crowded out real investment by changing the incentives of firm managers and directing funds away from real investment.
Abstract: Recent research has explored the growing ‘financialization’ process in the U.S. and other advanced economies. The term is a catch-all phrase used to denote important changes in the structure of non-financial corporations’ balance sheets, including the growth of income from financial subsidiaries and investment as well as growth in the transfer of earnings to financial markets in the forms of interest payments, dividend payments and stock buybacks. This paper seeks to empirically explore the relationship between financialization in the U.S economy and real investment at the firm level. Using data from a sample of non-financial corporations from 1973 to 2003, I find a negative relationship between real investment and financialization. First, increased financial investment and increased financial profit opportunities may have crowded out real investment by changing the incentives of firm managers and directing funds away from real investment. Second, increased payments to the financial markets may have impeded real investment by decreasing available internal funds, shortening the planning horizons of the firm management, and increasing uncertainty. These two channels can help explain the negative relationship I find between investment and financialization.
641 citations
TL;DR: The negative relationship between unemployment and health is consistent across Europe but varies by welfare state regime, suggesting that levels of social protection may indeed have a moderating influence.
Abstract: Background: The relationship between unemployment and increased risk of morbidity and mortality is well established. However, what is less clear is whether this relationship varies between welfare states with differing levels of social protection for the unemployed. Methods: The first (2002) and second (2004) waves of the representative cross-sectional European Social Survey (37 499 respondents, aged 25–60 years). Employment status was main activity in the last 7 days. Health variables were self-reported limiting long-standing illness (LI) and fair/poor general health (PH). Data are for 23 European countries classified into five welfare state regimes (Scandinavian, Anglo-Saxon, Bismarckian, Southern and Eastern). Results: In all countries, unemployed people reported higher rates of poor health (LI, PH or both) than those in employment. There were also clear differences by welfare state regime: relative inequalities were largest in the Anglo-Saxon, Bismarckian and Scandinavian regimes. The negative health effect of unemployment was particularly strong for women , especially within the Anglo-Saxon (OR LI 2.73 and OR PH 2.78) and Scandinavian (OR LI 2.28 and OR PH 2.99) welfare state regimes. Discussion: The negative relationship between unemployment and health is consistent across Europe but varies by welfare state regime, suggesting that levels of social protection may indeed have a moderating influence. The especially strong negative relationship among women may well be because unemployed women are likely to receive lower than average wage replacement rates. Policy-makers’ attention therefore needs to be paid to income maintenance, and especially the extent to which the welfare state is able to support the needs of an increasingly feminised European workforce.
445 citations
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TL;DR: The authors used the National Establishment Time Series (NETS) to revisit the debate about the role of small businesses in job creation and found that small firms and small establishments create more jobs, on net, although the difference is much smaller than what is suggested by Birch's methods.
Abstract: We use a new database, the National Establishment Time Series (NETS), to revisit the debate about the role of small businesses in job creation. Birch (e.g., 1987) argued that small firms are the most important source of job creation in the U.S. economy. But Davis et al. (1996a) argued that this conclusion was flawed, and based on improved methods and using data for the manufacturing sector, they concluded that there was no relationship between establishment size and net job creation. Using the NETS data, we examine evidence for the overall economy, as well as for different sectors. The results indicate that small firms and small establishments create more jobs, on net, although the difference is much smaller than what is suggested by Birch's methods. Moreover, in the recent period we study, a negative relationship between establishment size and job creation holds for both the manufacturing and services sectors.
423 citations
TL;DR: This article found that behavioral changes at the micro level in response to increasing income may lead to a non-linear relationship between aggregate incomes and disaster damages, where the risks increase with income before they decrease.
383 citations
TL;DR: This article investigated the relationship between fertility and education by investigating the introduction of universal primary education in Nigeria and found that increasing female education by one year reduces early fertility by 0.26 births.
258 citations
TL;DR: In this article, the authors revisited the relationship between income and fertility and found that fertility is negatively related to income in most countries at most times, and that several special assumptions are needed to generate the negative relationship.
Abstract: In this chapter we revisit the relationship between income and fertility. There is overwhelming empirical evidence that fertility is negatively related to income in most countries at most times. Several theories have been proposed in the literature to explain this somewhat puzzling fact. The most common one is based on the opportunity cost of time being higher for individuals with higher earnings. Alternatively, people might differ in their desire to procreate and accordingly some people invest more in children and less in market-specific human capital and thus have lower earnings. We revisit these and other possible explanations. We find that these theories are not as robust as is commonly believed. That is, several special assumptions are needed to generate the negative relationship. Not all assumptions are equally plausible. Such findings will be useful to distinguish alternative theories. We conclude that further research along these lines is needed.
232 citations
TL;DR: In this article, the authors examined the relationship between organizational ethical climate and the forms of organizational citizenship behavior (OCB), including in-role and extra-role behaviors, and examined the mediating effect of employee loyalty.
Abstract: This paper studies the relationship between organizational ethical climate and the forms of organizational citizenship behavior (OCB), including in-role and extra-role behaviors, and examines the mediating effect of employee loyalty. A sample of employees from a traditional Hong Kong-based company was used as a study group. The purpose of this study was to examine the causes and implications of how various ethical work climates affect employee performance. Based on a model proposed by Victor and Cullen, ethical climate is arranged from lower levels to higher levels. The results suggest that lower levels of ethical climate (instrumentality and independence), characterizing a weak relational contract between employee and employer, are associated with negative extra-role behavior. In contrast, higher levels of ethical climate (caring and law-and-code), symbolic of a strong relational contract at work, are associated with positive extra-role behavior. Moreover, normative commitment mediated a positive relationship between caring and identification with the company, whereas attitudinal loyalty mediated the negative relationship between independence and altruism. Implications for future research and practice are discussed.
173 citations
TL;DR: The results provide support for the hypothesis that self-assessed health captures individual traits not necessarily related to risk of health expenditures, in particular, attitudes towards risk.
Abstract: Both adverse selection and moral hazard models predict a positive relationship between risk and insurance; yet the most common finding in empirical studies of insurance is that of a negative correlation. In this paper, we investigate the relationship between ex ante risk and private health insurance using Australian data. The institutional features of the Australian system make the effects of asymmetric information more readily identifiable than in most other countries. We find a strong positive association between self-assessed health and private health cover. By applying the Lokshin and Ravallion (J. Econ. Behav. Organ 2005; 56:141-172) technique we identify the factors responsible for this result and recover the conventional negative relationship predicted by adverse selection when using more objective indicators of health. Our results also provide support for the hypothesis that self-assessed health captures individual traits not necessarily related to risk of health expenditures, in particular, attitudes towards risk. Specifically, we find that those persons who engage in risk-taking behaviours are simultaneously less likely to be in good health and less likely to buy insurance.
158 citations
TL;DR: In this article, the authors investigate the capital structure determinants of small and medium sized enterprises (SMEs) using a sample of Greek and French firms, and assess the extent to which the debt to assets ratio of firms depends upon their asset structure, size, profitability and growth rate.
Abstract: We investigate the capital structure determinants of small and medium sized enterprises (SMEs) using a sample of Greek and French firms We address the following questions: Are the capital structure determinants of SMEs in the two countries driven by similar factors? Are potential differences driven by country-specific or firm-specific factors? Are the size and structure of their financial markets important factors to explain any cross-country differences on SME capital structure? To answer these questions we apply panel data methods to the sample of firms for the period 1998 to 2002 We assess the extent to which the debt to assets ratio of firms depends upon their asset structure, size, profitability and growth rate The results show that the SMEs in both countries exhibit similarities in their capital structure choices Asset structure and profitability have a negative relationship with leverage, whereas firm size is positively related to their debt to assets ratio Growth is statistically significant only for France and is positively related to debt We attribute these similarities to their institutional characteristics and in particular the commonality of their civil law systems We find differences in the intensity of the capital structure relationship between the two countries We provide evidence that these differences are due to firm-specific rather than country factors
155 citations
TL;DR: This paper found that the negative relationship between income and left voting that is assumed in standard political economy models of democracy disappears among religious individuals in countries that use proportional representation, in large part because there is a moral values dimension that has a correlation with income that is equal in magnitude but has the opposite sign as the economic dimension.
Abstract: This article asks whether religion undermines the negative relationship between income and left voting that is assumed in standard political economy models of democracy. Analysis of cross-country survey data reveals that this correlation disappears among religious individuals in countries that use proportional representation. This is the case in large part because there is a moral values dimension that has a correlation with income that is equal in magnitude but has the opposite sign as the economic dimension, and the votes of the religious are better explained by their positions on moral than economic issues, especially in countries with multiparty systems. The authors conclude by discussing implications for theories of redistribution.
140 citations
TL;DR: In this article, a logistic regression model was applied within the transaction costs framework to identify factors that significantly influence the degree of commercialisation or market participation of small-scale farming households in Mpumalanga.
Abstract: This paper uses data collected from 177 small-scale farming households in Mpumalanga in an effort to identify factors that significantly influence the degree of commercialisation or market participation. A logistic regression model was applied within the transaction costs framework. Results support the hypothesis that transactions costs rank among the main determinants of commercialisation. The following variables were statistically significant: age, ability to speak/understand English, region, ownership of transport, access to market information, distance to market, dependency ratio, trust, land size and ownership of livestock. Increases in the latter four have negative effects on commercialisation. The negative relationship between land size and commercialisation probably indicates that increased market participation is also afunction of input (land) productivity.
TL;DR: For instance, women with high career-based unobservables (such as ambition or talent) may choose to have fewer (or no) children, and these women may be overrepresented in the labor force as discussed by the authors.
Abstract: Women are underrepresented in the paid labor force in both developed and developing countries. Recent scholarship has argued that labor force differentials are not due to gender per se, but can be attributed to the fact that women disproportionately face the responsibilities associated with bearing and raising children. While the negative relationship between the presence of children and participation in the labor force is well established, interpretation of this relationship is complicated by the endogeneity of fertility. The number of children a woman has is a choice variable which could be influenced by her labor force participation. Additionally, there are likely to be omitted factors that influence both fertility and labor force participation. For instance, women with high career-based unobservables (such as ambition or talent) may choose to have fewer (or no) children, and these women may be overrepresented in the labor force. Thus, the observed negative relationship between children and labor force participation could be spurious. Several studies have exploited exogenous changes in family size in order to identify the
TL;DR: In this article, the authors use comparative panel data for 14 European countries to elaborate dynamic outcome indicators for flexibility and employment security to assess the differences across countries and welfare regimes in balancing the two.
Abstract: The dominant view in economics is that increasing demands for flexibility on the labour market jeopardizes employment security. However, against the prediction of a negative relationship or a ‘trade-off ’ between flexibility and security, there is evidence for a positive, mutually reinforcing relationship known as the ‘flexicurity’ thesis. Using comparative panel data for 14 European countries, we elaborate dynamic outcome indicators for flexibility and employment security to assess the differences across countries and welfare regimes in balancing the two.We estimate transition models to explain the observed mobility patterns. The outcomes confirm the impact of the institutional set-up indicated by regime type on these transitions supporting the ‘variety of capitalism’ approach.The regulated Southern and Continental regimes perform worst and the unregulated Anglo-Saxon and Nordic regimes best in attaining high levels of flexibility and employment security simultaneously, though for both regimes with a small loss either in flexibility or in security.
14 Jul 2008
TL;DR: In this article, the authors used data from the US census to document the history of the relationship between fertility choice and key economic indicators at the individual level for women born between 1826 and 1960.
Abstract: In this paper, we use data from the US census to document the history of the relationship between fertility choice and key economic indicators at the individual level for women born between 1826 and 1960. We find that this data suggests several new facts that should be useful for researchers trying to model fertility. (1) The reduction in fertility known as the Demographic Transition (or the Fertility Transition) seems to be much sharper based on cohort fertility measures compared to usual measures like Total Fertility Rate; (2) The baby boom was not quite as large as is suggested by some previous work; (3) We find a strong negative relationship between income and fertility for all cohorts and estimate an overall income elasticity of about −0.38 for the period; (4) We also find systematic deviations from a time invariant, iso-elastic, relationship between income and fertility. The most interesting of these is an increase in the income elasticity of demand for children for the 1876–1880 to 1906–1910 birth cohorts. This implies an increased spread in fertility by income which was followed by a dramatic compression.
TL;DR: In this article, the authors investigated the relationship between 8th-graders' mathematics and science achievement and their self-perceptions on these two subjects using three waves of the TIMSS data.
Abstract: Using 3 waves of the TIMSS data, this study investigates the relationship between 8th-graders' mathematics and science achievement and their self-perceptions on these 2 subjects. For within-country data, there is generally a positive relationship between students' achievement and the following 3 measures of their self-perception: how much they like the 2 subjects, their self-perceived competence in the subjects, and their perceived easiness of the subjects. However, in a between-country analysis, the relationship is opposite. More specifically, when the same 3 self-perception measures are aggregated at the country level, there is a negative relationship between self-perceptions and achievement. These findings are consistent for both mathematics and science across the data for all 3 waves. Correlation analysis is used for both within-country and between-country analyses. Among several possible explanations, the authors suggest that this pattern may reflect high academic standards in high-performing countri...
TL;DR: This paper used the National Establishment Time Series (NETS) to revisit the debate about the role of small businesses in job creation and found that small establishments and small firms create more jobs, on net, although the difference is much smaller than what is suggested by Birch's methods.
Abstract: We use a new database, the National Establishment Time Series (NETS), to revisit the debate about the role of small businesses in job creation. Birch (e.g., 1987) argued that small firms are the most important source of job creation in the U.S. economy, but Davis et al. (1996a) argued that this conclusion was flawed, and based on improved methods and using data for the manufacturing sector they concluded that there was no relationship between establishment size and net job creation. Using the NETS data, we examine evidence for the overall economy, as well as for different sectors. The results indicate that small establishments and small firms create more jobs, on net, although the difference is much smaller than what is suggested by Birch's methods. However, the negative relationship between establishment size and job creation is much less clear for the manufacturing sector, which may explain some of the earlier findings contradicting Birch's conclusions.
TL;DR: This article investigated how the reduction of barriers to migration affected the decision of middle school graduates to attend high school in rural China and found a robust, negative relationship between migrant opportunity and high school enrollment that cannot be explained by geographic convergence in access to education across rural China.
Abstract: This paper investigates how the reduction of barriers to migration affected the decision of middle school graduates to attend high school in rural China. Change in the cost of migration is identified using exogenous variation across counties in the timing of national identity card distribution, which made it easier for rural migrants to register as temporary residents in urban destinations. After taking care to address potential strengths and weaknesses of our identification strategy, we find a robust, negative relationship between migrant opportunity and high school enrollment that cannot be explained by geographic convergence in access to education across rural China.
TL;DR: In this article, the authors investigate the equity market timing hypothesis of capital structure in major industrialized (G-7) countries and find that leverage of firms is negatively related to the historical market-to-book ratio in all G-7 countries.
Abstract: We investigate the equity market timing hypothesis of capital structure in major industrialized (G-7) countries. As claimed by its proponents, we find that leverage of firms is negatively related to the historical market-to-book ratio in all G-7 countries. However, this negative relationship cannot be attributed to equity market timing. We find no association between equity issues and market-to-book ratios at the time of equity financing decisions by Japanese firms. Firms in all G-7 countries, except Japan, undo the effect of equity issuance and the impact of equity market timing attempts on leverage is short lived. This is inconsistent with the prediction of the equity market timing hypothesis and more in line with dynamic trade-off model.
TL;DR: In this article, the authors examine the relationship between fragmented intellectual property (IP) rights and innovative performance, taking into consideration the role played by in-licensing of IP, and find that firms facing more fragmented IP landscapes are more likely to report expenditures on inlicensing and for those firms that do incur license costs, a weak positive association between licensing expenditure and fragmented IP rights in the relevant technology.
Abstract: We examine the relationship between fragmented intellectual property (IP) rights and innovative performance, taking into consideration the role played by in-licensing of IP. Controlling for a variety of firm and market characteristics, we find that firms facing more fragmented IP landscapes are more likely to report expenditures on in-licensing and for those firms that do incur license costs we find a weak positive association between licensing expenditure and fragmented IP rights in the relevant technology. We also observe a negative relationship between IP fragmentation and innovative performance, but only for firms that engage in in-licensing and only for product innovation. The relationship between fragmentation and innovative performance also depends on the size of a firm's patent portfolio, which suggests an important strategic role for defensive patenting in the context of fragmented property rights.
TL;DR: In this paper, the authors argue that labour law is endogenous, with both the production and the application of labour law norms influenced by national and sectoral contexts, and by complementarities between the institutions of the labour market and those of corporate governance and financial markets.
Abstract: Standard economic theory sees labour law as an exogenous interference with market relations and predicts mostly negative impacts on employment and productivity. We argue for a more nuanced theoretical position: labour law is, at least in part, endogenous, with both the production and the application of labour law norms influenced by national and sectoral contexts, and by complementarities between the institutions of the labour market and those of corporate governance and financial markets. Legal origin may also operate as a force shaping the content of the law and its economic impact. Time-series analysis using a new dataset on legal change from the 1970s to the mid-2000s shows evidence of positive correlations between regulation and growth in employment and productivity, at least for France and Germany. No relationship, either positive or negative is found for the UK and although the US shows a weak negative relationship between regulation and employment growth, this is offset by productivity gains.
TL;DR: The authors found that regardless of the method of estimation, there is a negative relationship between the proportion of family firms in a state and gross state product per capita, indicating that the formation of family businesses is likely to be influenced by the characteristics of the environment.
Abstract: The formation of family firms, as well as their scale and scope, is likely to be influenced by the characteristics of the environment. This study presents preliminary findings on the relationship between economic development and the prevalence of family vs. nonfamily firms in the United States. We use three samples consisting of 15,918 firms aggregated at the state level and two methods of estimating the proportion of family businesses in each state. Our results indicate that regardless of the method of estimation, there is a negative relationship between the proportion of family firms in a state and gross state product per capita. Implications and research directions are provided.
TL;DR: This paper investigated the link between perceptions of negative workplace relationships and organisational outcomes and found that those with at least one negative relationship at work were significantly less satisfied, reported less organisational commitment, were part of less cohesive workgroups and were significantly more likely to be planning to leave their job.
Abstract: This study investigates the link between perceptions of negative workplace relationships and organisational outcomes. Respondents (n = 412) spanned a wide range of occupations, industries and nationalities. Data were collected using an Internet-based questionnaire. Results indicated that those with at least one negative relationship at work were significantly less satisfied, reported less organisational commitment, were part of less cohesive workgroups and were significantly more likely to be planning to leave their job.
TL;DR: In this article, the authors investigated the empirical relationship between educational subsidies and migration prospects, obtaining a negative relationship for 105 countries and revisited the country specific effects of skilled migration upon human capital.
TL;DR: In this article, the authors investigated the nonlinear relationship between energy consumption growth and economic growth when threshold variables are used and found that there is a significant positive relationship between the two.
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TL;DR: In this article, the authors investigated the empirical relationship between educational subsidies and migration prospects, obtaining a negative relationship for 105 countries and revisited the country specific effects of skilled migration upon human capital.
Abstract: Assuming a given educational policy, the recent brain drain literature reveals that skilled migration can boost the average level of schooling in developing countries. This paper introduces educational subsidies determined by governments concerned by the number of skilled workers remaining in the country. The theoretical analysis shows that developing countries can benefit from skilled emigration when educational subsidies entail high .fiscal distortions. However when taxes are not too distortionary, it is desirable to impede emigration and subsidize education. The authors investigate the empirical relationship between educational subsidies and migration prospects, obtaining a negative relationship for 105 countries. Based on this result, the analysis revisits the country specific effects of skilled migration upon human capital. The findings show that the endogeneity of public subsidies reduces the number of winners and increases the magnitude of the losses.
TL;DR: In this article, the authors argue that labour law is endogenous, with both the production and the application of labour law norms influenced by national and sectoral contexts, and by complementarities between the institutions of the labour market and those of corporate governance and financial markets.
Abstract: Standard economic theory sees labour law as an exogenous interference with market relations and predicts mostly negative impacts on employment and productivity. We argue for a more nuanced theoretical position: labour law is, at least in part, endogenous, with both the production and the application of labour law norms influenced by national and sectoral contexts, and by complementarities between the institutions of the labour market and those of corporate governance and financial markets. Legal origin may also operate as a force shaping the content of the law and its economic impact. Time-series analysis using a new data set on legal change from the 1970s to the mid-2000s shows evidence of positive correlations between regulation and growth in employment and productivity, at least for France and Germany. No relationship, either positive or negative, is found for the UK and, although the United States shows a weak negative relationship between regulation and employment growth, this is offset by productivity gains.
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TL;DR: This paper showed that there is a negative relationship between central bank financial strength and inflation outcomes, and that this relationship appears to be robust to the choice of alternative country samples, control variables, estimation strategies, and conceptualizations of central bank monetary strength.
Abstract: The financial health of central banks and its relation to policy outcomes has recently been recognized as an important policy issue. While case study evidence clearly indicates that weak central bank finances can hamper effective policy implementation, the question of whether central bank financial strength influences policy performance remains controversial. This is due, in part, to a lack of econometric evidence. The paper presents a first step toward filling this gap, by providing a quantitative evaluation of the relationship between measures of central bank financial strength and policy performance, in particular inflation. The paper's major finding is that there indeed is a negative relationship between central bank financial strength and inflation outcomes. This relationship appears to be robust to the choice of alternative country samples, control variables, estimation strategies, and conceptualizations of central bank financial strength.
TL;DR: An accident path model was developed to estimate the pattern and strength of relationships amongst the personal and sociotechnical variables in accident/injury occurrences and showed that there are sequential interactions amongst the socioteschnical and personal factors leading to accidents/injuries in mines.
Abstract: Occupational injuries in mines are attributed to many factors. In this study, an attempt was made to identify the various factors related to work injuries in mines and to estimate their effects on work injuries to mine workers. An accident path model was developed to estimate the pattern and strength of relationships amongst the personal and sociotechnical variables in accident/injury occurrences. The input data for the model were the correlation matrix of 18 variables, which were collected from the case study mines. The case study results showed that there are sequential interactions amongst the sociotechnical and personal factors leading to accidents/injuries in mines. Amongst the latent endogenous constructs, job dissatisfaction and safe work behaviour show a significant positive and negative direct relationship with work injury, respectively. However, the construct safety environment has a significant negative indirect relationship with work injury. The safety environment is negatively affected by work hazards and positively affected by social support. The safety environment also shows a significant negative relationship with job stress and job dissatisfaction. However, negative personality has no significant direct or indirect effect on work injury, but it has a significant negative relationship with safe work behaviour. The endogenous construct negative personality is positively influenced by job stress and negatively influenced by social support.
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TL;DR: In this article, the relationship between real exchange rate and trade balance in Malaysia from year 1955 to 2006 was identified using Unit Root Tests, Cointegration techniques, Engle-Granger test, Vector Error Correction Model (VECM), and impulse response analyses.
Abstract: This paper attempts to identify the relationship between the real exchange rate and trade balance in Malaysia from year 1955 to 2006. This study uses Unit Root Tests, Cointegration techniques, Engle-Granger test, Vector Error Correction Model (VECM), and impulse response analyses. The main findings of this paper are: (i) long run relationship exists between trade balance and exchange rate. Other important variables that determine trade balance such as domestic income shows a long run positive relationship between trade balances, and foreign income shows a long run negative relationship (ii) the real exchange rate is an important variable to the trade balance, and devaluation will improve trade balance in the long run, thus consistent with Marshall-Lerner condition (iii) the results indicate no J-curve effect in Malaysia case.
TL;DR: In this article, the authors examined the relationship between economic wealth, culture, and the fact that national software piracy rates have been declining steadily since 1994 using a larger sample than has previously been available (57 countries).
Abstract: A number of studies have investigated and found a significant relationship among economic wealth, Hofstede’s national culture dimensions, and software piracy rates (SPR). No study, however, has examined the relationship between economic wealth, culture, and the fact that national SPRs have been declining steadily since 1994. Using a larger sample than has previously been available (57 countries), we confirm the expected negative relationship between economic wealth, culture (individualism and masculinity) and levels of software piracy. The rate of decline in software piracy, however, is found to be a cultural phenomenon, with two factors (power distance (PDI) and uncertainty avoidance (UAI)) working in opposition. Similar results are found for a subset of 37 relatively poor countries. This suggests that, while the rise in economic wealth seen for most countries should lead to a reduction in software piracy, the rate of decline is determined by cultural factors. Global strategies for dealing with software piracy are discussed.