foreign exchange market intervention and reserve accumulation in emerging asia is there evidence of fear of appreciation abstract asian central banks react more strongly to currency appreciations than depreciations and more to nominal effective exchange rates neers than to bilateral us dollar rates this rationalizes the relative exchange rate stability and the sustained reserve accumulation in the region

occupational choice an application to the market for public school teachers most previous work on occupational choice does not satisfactorily treat the potentially important effects of future demand conditions in contrast this paper develops and estimates a rational expectations model in which agents look beyond expected starting salaries and take explicit account of future demand conditions the empirical results demonstrate that future demand conditions are important determinants of the decision to acquire secondary school certification but are not important for the decision to acquire elementary school certification the paper concludes with a comparison of the dynamic properties of the rational expectations model and a cobweb specification

do r d tax credits work evidence from a panel of countries 1979 1997 this paper examines the impact of fiscal incentives on the level of r d investment an econometric model of r d investment is estimated using a new panel of data on tax changes and r d spending in nine oecd countries over a 19 year period 1979 1997 we find evidence that tax incentives are effective in increasing r d intensity this is true even after allowing for permanent country specific characteristics world macro shocks and other policy influences we estimate that a 10 fall in the cost of r d stimulates just over a 1 rise in the level of r d in the short run and just under a 10 rise in r d in the long run

occupational self selection a human capital approach to sex differences in occupational structure a rich and diverse literature exists concerning the distribution of labor incomes one approach namely that of human capital concentrates on lifetime accumulation paths of earnings capacity units human capital individual variations in human capital imply differences in earnings power thereby yielding strong implications concerning earnings distribution within a population despite its explanatory power the human capital model has been widely criticized one criticism centers on its inability to obtain inferences concerning occupational distribution the purpose of this paper is to alleviate at least some such criticism by applying the hedonic price approach so as to embed occupational choice into the human capital framework the significance is that neoclassical economic theory can be used to obtain implications concerning the determinants of occupational structure excerpt

global financial shocks and foreign asset repatriation do local investors play a stabilizing role we study the dynamic response of gross capital flows in emerging market economies to different global financial shocks using a panel vector autoregressive pvar approach our focus lies primarily on the potentially stabilizing role played by domestic investors in offsetting the response of foreign investors to adverse global shocks we find that while foreign investors tend to retrench from emerging markets in response to global risk aversion and monetary policy shocks foreign asset repatriation by resident investors does not always follow suit local investors play a meaningful stabilizing role in the face of global risk aversion shocks with sizeable asset repatriation largely offsetting the retrenchment of non residents in contrast foreign investor retrenchment in response to global monetary policy shocks is not mirrored by asset repatriation finally we find robust evidence that positive global real shocks tend to have a positive impact on net capital inflows to emerging markets our results shed light on the likely impact of the fed s qe tapering on capital flows to emerging market economies

can a liberalization of capital outflows increase net capital inflows abstract facing massive capital inflows that put downward pressure on the real exchange rate some policymakers and analysts have recommended a liberalization of capital outflows empirically however the removal of capital outflow controls has apparently stimulated a net inflow of capital in several experiences such as britain since 1979 italy new zealand and spain in the mid to late 1980s and colombia egypt and mexico in the 1990s numerous measures to liberalize capital outflows in chile during the 1990s have not had a noticeable effect in offseting a surge of net capital inflows how can we explain the apparent paradox that reducing controls on capital outflows can actually increase net capital inflows our theoretical model provides one such explanation a liberalization of capital outflows understood here as a reduction in the minimum capital repatriation period for foreign investment reduces the degree of irreversibility of the decision to invest in a given country this in turn lowers the option value of waiting until uncertainty about a possible change in the rules of the game that affect investment in domestic assets is resolved because in this event foreigners investing at home will be stuck with the low return asset for a shorter period of time thus a reduction in the minimum repatriation period is likely to increase not decrease net capital inflows this result has an important policy implication liberalizing capital outflows may have significant benefits on its own but it may not be the appropriate policy to defend the real exchange rate in the presence of massive capital inflows because it is likely to strengthen those very capital inflows

globalization and the gender earnings gap evidence from sri lanka and cambodia disasters in bangladesh and protests elsewhere have created an intense debate about the value particularly to women of apparel employment in developing countries this paper focuses on how the forces of globalization specifically the multi fibre arrangement mfa have affected women s wages in the apparel sector in developing countries the paper uses household and labor force surveys from cambodia and sri lanka to estimate both apparel wage premiums relative to other industries and the male female wage gap before and after the end of the mfa the approach builds on new models that apply traditional trade theory e g the heckscher ohlin and stolper samuelson theorems to analyze the effect of globalization on gender based earnings the authors find large positive wage premiums and a closing of the male female wage gap during the mfa period but smaller premiums and a widening wage gap after the end of the mfa the results suggest that the benefits of apparel exports for women in developing countries remain significant post mfa they also model an approach for studying the effects of globalization that differentiates males and females as separate factors this may be a fruitful alternative to discrimination models or those that analyze the effects of globalization on women in terms of skill further research is necessary to identify the potential development effects of post mfa apparel employment and to thoroughly compare the benefits documented in this paper with the costs that may come with apparel jobs

gendering the varieties of capitalism a study of occupational segregation by sex in advanced industrial societies this article explores the unintended gendered consequences of employment protection and vocational training systems it develops a micrologic of skill investment by workers and employers to identify the mechanism by which specific skills become disadvantageous for women the central claim of the article is that institutions that encourage male investment in specific skills exacerbate occupational sex segregation the article finds that coordinated market economies because of their robust institutional protection of male skill investments are generally more sex segregating than are liberal market economies the empirical section provides cross sectional analyses of advanced industrial countries

financial liberalization financial sector development and growth evidence from malaysia abstract the objective of this paper is to examine whether financial development leads to economic growth or vice versa in the small open economy of malaysia using time series data from 1960 to 2001 we conduct cointegration and causality tests to assess the finance growth link by taking the real interest rate and financial repression into account the empirical evidence suggests that financial liberalization through removing the repressionist policies has a favorable effect in stimulating financial sector development financial depth and economic development are positively related but contrary to the conventional findings our results support robinson s view that output growth leads to higher financial depth in the long run

income distribution political instability and investment abstract this paper successfully tests on a sample of 71 countries for the period 1960 85 the following hypotheses income inequality by fuelling social discontent increases sociopolitical instability the latter by creating uncertainty in the politico economic environment reduces investment as a consequence income inequality and investment are inversely related since investment is a primary engine of growth this paper identifies a channel for an inverse relationship between income inequality and growth we measure socio political instability with indices which capture the occurrence of more or less violent phenomena of political unrest and we test our hypotheses by estimating a two equation model in which the endogenous variables are investment and an index of socio political instability our results are robust to sensitivity analysis on the specification of the model and the measure of political instability and are unchanged when the model is estimated using robust regression techniques

detecting and removing discrimination under equal opportunities policies abstract this paper surveys part of the recent voluminous literature on the economics of discrimination focusing on two key questions first how should discrimination be measured and can in fact unambiguous estimates be derived as the basis for detecting where discrimination is present and setting in train measures to eliminate it second to what extent has the implementation of equal opportunities legislation improved the relative standing of women and minority workers in the labour force this section includes a discussion of the likely effects of recent changes in the law such as the equal value amendment in the uk or the introduction of comparable worth in the usa the survey concludes that our ability to detect discrimination at all precisely is still rudimentary and consequently policy measures are likely to be inefficient for this reason

does schooling cause growth a number of economists find that growth and schooling are highly correlated across countries a model is examined in which the ability to build on the human capital of one s elders plays an important role in linking growth to schooling the model is calibrated to quantify the strength of the effect of schooling on growth by using evidence from the labor literature on mincerian returns to education the upshot is that the impact of schooling on growth explains less than one third of the empirical cross country relationship the ability of reverse causality to explain this empirical relationship is also investigated

intellectual property rights violations and spillovers in north south trade abstract the article examines the role of technological spillovers when northern and southern firms compete in quantities on the common world market and when only the northern firm is supposed to conduct innovative activity the intensity of spillovers is interpreted as an indicator of the strength of intellectual property rights ipr protection in this light the paper reconsiders the questions raised in the recent economic analysis of ipr protection in north south relations when and whether the southern countries benefit in welfare terms from protecting ipr how the north fares in this story how large is the conflict between the north and south and what is the optimal level of ipr protection at the world level the paper shows that the common belief that the south generally benefits from relaxing ipr protection while the north is worse off does not carry over in the applied duopoly model with spillovers in this respect the congruence of interests between north and south with respect to southern ipr protection regime should not be an exceptional or even impossible state of affairs

a cross national comparison of the gender gap in income this article examines national labor market samples from two dualist countries the united states and canada and two corporatist countries norway and sweden labor market location is less powerful in predicting income in norway and sweden where they have more inclusive employment policies in sweden though the labor market variables are more important in explaining the income gap family effects marital status and number of children are weak everywhere but especially in scandinavia nevertheless because it is encouraged by policies designed to integrate employment and family part time paid work has a major effect on the gender gap in income in norway and sweden women however pay more of a penalty than men for part time employment in north america

intercountry comparisons of labor force trends and of related developments an overview this paper is a survey of analyses of women s labor force growth in 12 industrialized countries originally presented at a conference in sussex england in june 1983 the main focus of the conference papers and of the current survey is on growth of the labor force of married women in the years 1960 80 trends in fertility wages and family instability also receive attention as related developments married women s labor force growth is observed in all countries except for the ussr after 1970 where labor force rates of women reached the level of men growth rates differ among countries they apparently respond to growth in real wages and to growth in education but response elasticities differ among countries estimates of these elasticities contained in the country papers were helpful in predicting the trends other findings include ubiquitous declines in fertility and growth of divorce in the 1970s both developments are related to long run labor force growth in all countries wages of women were lo

do capital market imperfections exacerbate output fluctuations abstract we develop a dynamic general equilibrium macroeconomic model where a proportion of firms are credit constrained due to asymmetric information in general a macroeconomic shock has additional effects created by a reallocation of funds between credit constrained and unconstrained firms as they have different marginal productivities we show however that the output response to shocks is not necessarily amplified and can be dampened by the presence of asymmetric information this depends on the impact of the shock on the composition of external and internal funds for credit constrained firms

why do southern countries have little incentive to protect northern intellectual property rights instead of focusing on the conflict of interests between north and south the author studies the conflict of interests among southern countries and provides an alternative answer to the question why do southern countries have little incentive to protect northern intellectual property rights owing to the incentive of each southern country to free ride on other southern countries with respect to providing protection the overall protection they provide is not sufficient therefore a new source of mutual gains exists among southern countries and also between north and south a joint effort of southern countries is required to exploit these gains

endogenous r d and intellectual property laws in developed and emerging economies the incentive of providing protection of intellectual property has been analyzed both for an emerging economy as well as for a developed economy the optimal patent length and the optimal patent breadth within a country are found to be positively related to each other for a fixed structure of laws abroad moreover a country can respond to stronger patent protection abroad by weakening its patent protection under certain circumstances and by strengthening its patent protection under other circumstances these results depend upon the curvature of the r d production function finally we investigate the impact of an increase in the willingness to pay in the emerging economy and find conditions under which there is an improvement in both patent length as well as patent breadth in the emerging economy

the relationship between interest rate differentials and macroeconomic variables a panel data study for european countries abstract based on panel data regressions the relationship between 12 month interest rate differentials and macroeconomic variables is analyzed for nine european countries relative to germany stationarity properties of the variables are examined by tests developed for panel data models the distribution of the test statistic is not normal and is bootstrapped from the sample at hand all significant regression coefficients are estimated with the predicted sign in particular the inflation differential the real income growth differential relative labor costs and the current account have a strong effect on the interest rate differential hence the results indicate that governments have some scope for influencing the interest rate differential by conducting the appropriate macroeconomic policy these results are considerably more optimistic compared to earlier studies where interest rate differentials are frequently measured at 1 month and 3 months maturity included also is an analysis of whether the erm countries have gained more credibility in exchange rate policy through the exchange rate system

ocupational segregation labour force participation and the relative earnings of men and women a model of the labour market is developed in which particiaption rates of men and women wages rates of men and women and occupational segregation are determined simultaneously the model is estimated using cross sectional data from australia the most important empirical results are that a particiaption rates wage rates and occupational segregation should be viewed as being simultaneously determined b differences in male and female labour force attactment and human capital attainment are important determinants of the gender composition of occupations and c there is little direct evidence in this study to support discrimination based theories of occupational segregation

institutional quality and international trade institutions quality of contract enforcement property rights shareholder protection and the like have received a great deal of attention in recent years yet trade theory has not considered the implications of institutional differences beyond treating them simply as different technologies or taxes the purpose of this paper is twofold first we propose a simple model of international trade in which institutional differences are modeled within the framework of incomplete contracts we show that doing so reverses many of the conclusions obtained by equating institutions with productivity institutional differences as a source of comparative advantage imply among other things that the less developed country may not gain from trade and factor prices may actually diverge as a result of trade second we test empirically whether institutions act as a source of trade using data on us imports disaggregated by country and industry the empirical results provide evidence of institutional content of trade institutional differences are an important determinant of trade flows

liberalization fdi and growth in developing countries a panel cointegration approach using a panel cointegration framework the article explores the two way link between fdi and growth for a panel of 23 developing countries in addition it investigates the impact of liberalization on the dynamics of the fdi and gdp relationship a long run cointegrating relationship is found between fdi and gdp after allowing for heterogeneous country effects the cointegrating vectors reveal a bidirectional causality between gdp and fdi for more open economies for relatively closed economies long run causality appears unidirectional and runs from gdp to fdi implying that growth and fdi are not mutually reinforcing under restrictive trade and investment regimes

thresholds in the process of international financial integration abstract the financial crisis has re ignited the fierce debate about the merits of financial globalization and its implications for growth especially for developing countries the empirical literature has not been able to conclusively establish the presumed growth benefits of financial integration indeed a new literature proposes that the indirect benefits of financial integration may be more important than the traditional financing channel emphasized in previous analyses a major complication however is that there seem to be certain threshold levels of financial and institutional development that an economy needs to attain before it can derive the indirect benefits and reduce the risks of financial openness in this paper we develop a unified empirical framework for characterizing such threshold conditions we find that there are clearly identifiable thresholds in variables such as financial depth and institutional quality the cost benefit trade off from financial openness improves significantly once these threshold conditions are satisfied we also find that the thresholds are lower for foreign direct investment and portfolio equity liabilities compared to those for debt liabilities

heterogeneity of southern countries and southern intellectual property rights policy we develop a model with one innovating northern firm and heterogeneous southern firms that compete in a final product market we assume southern firms differ in their ability to adapt technology and study southern incentives to protect intellectual property rights we find that in a non cooperative equilibrium governments resist ipr protection but collectively southern countries benefit from some protection we show that in general countries with more efficient firms prefer higher collective ipr protection than those with less efficient firms given the aggregate level of ipr protection it is more efficient if the more efficient countries have weaker ipr protection les auteurs developpent un modele dans lequel coexistent une entreprise innovatrice du nord et des entreprises heterogenes du sud qui se concurrencent dans un marche de produit final on postule que les entreprises du sud different dans leur capacitea adopter la technologie et on etudie les differentes incitations au sud a proteger les droits de propriete intellectuelle dpi il appert que dans un equilibre sans cooperation les gouvernements resistent a la pression pour qu on protege les dpi mais que collectivement ils beneficient de cette protection on montre qu en general les pays dont les entreprises sont les plus efficaces supportent une protection collective des dpi plus robuste que ne le font les pays dont les entreprises sont moins efficaces le niveau general de protection des dpi etant donne c est plus effectif si les pays les plus efficaces ont des niveaux de protection des dpi plus faibles

the north s intellectual property rights standard for the south abstract we build a multi sectoral north south trade model to analyze international intellectual property rights ipr protection by comparing the nash equilibrium ipr protection standard of the south the developing countries with that of the north the developed countries we find that the former is naturally weaker than the latter moreover we show that both regions can gain from an agreement that requires the south to harmonize its ipr standards with those of the north and the north to liberalize its traditional goods market this demonstrates the merits of multi sectoral negotiations in the gatt wto

market structure innovation and optimal patent life m uch work has been directed at determining the relative efficiency of various market structures in the allocation of resources to invention while the conclusions are not entirely clear it seems certain that no single market structure results in a pareto efficient allocation of resources to research and development r d in the light of this certain secondbest procedures must be examined social controls may provide an attractive method of lessening the inefficiencies described above 2 while government research and development subsidies and award programs do exist the most prevalent form of social control is the patent system granting the inventor a monopoly on the use of the discovery for a specified period of time eliminates the free rider problem thus restoring the incentive to invent extension of the duration of protection will increase incentives for private resource allocation toward technical advance unfortunately extension of patent protection by definition brings with it the social inefficiencies recognized in a monopolistic market the

how broad should the scope of patent protection be i explore the trade off between a patent s length that is its lifetime and its width that is its scope of coverage a wider patent generally reduces the distortion of consumers choices between the patented brand of the product and unpatented lower priced varieties sold by competitors but also permits higher prices which increase relative to profits the deadweight losses from consumers switching consumption out of the product class i show under what conditions infinitely lived but very narrowly focused patents are the socially efficient way to reward innovation and under what conditions very short lived but very broad patents are optimal

distributive politics and economic growth a crude distinction between economics and politics would be that economics is concerned with expanding the pie while politics is about distributing it in this paper we analyze the relationship between the two we focus on how an economy s initial configuration of resources shapes the political struggle for income and wealth distribution and how that in turn affects long run growth our main conclusion is that inequality is conducive to the adoption of growth retarding policies we derive this result from a simple political economy model of growth and present cross country evidence consistent with it the key feature of our model is that individuals differ in their relative factor endowments we distinguish between two types of factors an accumulated factor called capital and a nonaccumulated factor called labor growth is driven by the expansion of the capital stock which is in turn determined by individual saving decisions long run growth is endogenous as the aggregate production function is taken to be linearly homogeneous in capital and productive government services taken together the provision of government services is financed by a tax on capital because government services are productive a small tax on

the causes and consequences of occupational segregation a simultaneous equations approach lewis and shorten applied economics 1991 23 167 77 have proposed that male and female earnings male and female labour force participation rates and occupational segregation are simultaneously determined in the labour market they estimate their model for australia using 1981 census data and find substantial evidence to support their hypothesis however there have been no subsequent studies to empirically test their hypothesis for other countries in this paper their model for the united states using 1990 census data is replicated all but one of the coefficients on the endogenous variables have the same signs as those reported by lewis and shorten which tends to support their model the specification of lewis and shorten s model is tested and it is inappropriate for the us data the model is then reformulated and re estimated the reformulated model also shows substantial evidence of simultaneity between occupational segregation and other labour market outcomes

international protection of intellectual property we study the incentives that governments have to protect intellectual property in a trading world economy we consider a world economy with ongoing innovation in two countries that differ in market size and in their capacities for innovation after describing the determination of national patent policies in a non cooperative regime of patent protection we ask why is intellectual property better protected in the north than in the south we also study international patent agreements by deriving the properties of an efficient global regime of patent protection and asking whether harmonization of patent policies is necessary or sufficient for global efficiency jel o34 f13 during the 1980 s and early 1990 s the united states and several european countries expressed strong dissatisfaction with what they deemed to be inadequate protection of intellectual property in many developing countries the developed countries made the upgrading of intellectual property rights iprs one of their highest priorities for the uruguay round of trade talks their efforts bore fruit in the agreement on traderelated aspects of intellectual property rights trips which was approved as part of the final act of the uruguay round trips establishes minimum standards of protection for several categories of intellectual property for example in the area of new technology it essentially harmonizes

why doesn t capital flow from rich to poor countries an empirical investigation we examine the empirical role of difierent explanations for the lack of ows of capital from rich to poor countries the lucas paradox the theoretical explanations include difierences in fundamentals across countries and capital market imperfections we show that during 1970i2000 low institutional quality is the leading explanation for example improving peru s institutional quality to australia s level implies a quadrupling of foreign investment recent studies emphasize the role of institutions for achieving higher levels of income but remain silent on the speciflc mechanisms our results indicate that foreign investment might be a channel through which institutions afiect long run development

short term employment transitions of women in the israeli labor force using data on jewish israeli women aged 25 to 55 the author examines patterns and determinants of women s transitions among four employment categories regular full time employment reduced hours full time employment part time employment and non employment israeli women are not trapped in part time employment departures from reduced hour and part time employment occur at higher rates than departures from full time jobs women who have just given birth have an increased likelihood of moving from full time employment to reduced hour or part time employment women in female type occupations and those in peripheral jobs jobs outside core industries are more likely than other women to reduce their work hours or exit the labor force the author argues that although part time work is a valuable short term option for many women in the long run it preserves labor market institutions that are disadvantageous to women

the influence of capital controls on long run growth where and how much abstract the financial crisis in east asia generated a revival of interest in the merits of financial openness the ensuing debate on the benefits of openness has focused more on short and medium run issues than on the long run effects within the empirical literature on economic growth little or no attention has been paid to the effects of financial openness contrary to the orthodox position the few results that exist suggest that capital controls have no effect on economic growth this paper argues that this conclusion emerges from a failure to account for underlying differences across countries with similar degrees of capital controls we show that the degree of ethnic and linguistic heterogeneity in a country plays a significant role in explaining the effects of controls on economic growth for countries with relatively higher degrees of ethnic heterogeneity the effects are particularly adverse whereas for countries with high degrees of homogeneity capital controls actually have a net positive effect on economic growth on balance more developing countries suffered due to controls than not within the sample of 57 non oecd countries that did implement controls for the period 1975 1995 as many as 39 saw a reduction in their growth rates this result is robust to a number of variables commonly used in the economic growth regressions

gender and job performance evidence from wall street this study concerns the relationship between gender and job performance among brokerage firm equity analysts women s representation in analyst positions dropped from 16 percent in 1995 to 14 percent in 2005 the study found significant gender based differences in performance on various dimensions for example women cover roughly 9 stocks on average as compared with 10 for men and women s earnings estimates tend to be less accurate than men s estimates but the study also found that women are significantly more likely than men to be designated as all stars which indicates that they outperform men in other aspects of job performance

capital account liberalization financial depth and economic growth abstract we show a statistically significant and economically relevant effect of open capital accounts on financial depth and economic growth in a cross section of countries over the periods 1986 1995 and 1976 1995 countries having open capital accounts had a significantly greater increase in financial depth and over the 20 year period greater economic growth these results however are largely driven by the developed countries included in the sample the observed failure of capital account liberalization to promote financial deepening among developing countries suggests potentially important policy implications concerning the desirability of opening up the capital account