inequality and the impact of growth on poverty comparative evidence for sub saharan africa abstract this study explores the extent to which inequality affects the impact of income growth on the rates of poverty changes in sub saharan africa ssa compared to non ssa based on an unbalanced panel of 86 countries over 1977 2004 for all three measures of poverty headcount gap and squared gap the impact of gdp growth on poverty reduction is a decreasing function of initial inequality the impacts are similar in direction for ssa and non ssa so that within both regions there are considerable disparities in the responsiveness of poverty to income growth depending on inequality nevertheless the income growth elasticity is substantially less for ssa implying relatively small poverty reduction response to growth

endogeneity in brand choice models applications of random utility models to scanner data have been widely presented in marketing for the last 20 years one particular problem with these applications is that they have ignored possible correlations between the independent variables in the deterministic component of utility price promotion etc and the stochastic component or error term in fact marketing mix variables such as price not only affect brand purchasing probabilities but are themselves endogenously set by marketing managers this work tests whether these endogeneity problems are important enough to warrant consideration when estimating random utility models with scanner panel data our results show that not accounting for endogeneity may result in a substantial bias in the parameter estimates

the role of real income level and income distribution in fulfillment of basic needs abstract using internationally comparable estimates of real gdp per capita along with world bank data on seven basic needs indicators and one income equality measure relative importance of real income level and income equality for improvement in the provision of basic needs is assessed on the basis of a multiple regression model income level seems important in almost all cases but the importance of income equality is observed only on a limited scale although income is probably more important in low income ldcs the relationships studied appear broadly similar in the low income and the middle income ldc contexts

income inequality and the environment aggregation bias in environmental kuznets curves abstract the environmental kuznets curve assumes an inverted u shaped relation between environmental damage and per capita income recently it has been argued in the literature that in addition to income levels the inequality in the distribution of power and income is positively related to environmental degradation we provide an additional argument based on simple aggregation for including a measure of income dispersion in empirical analyses when the relationship between environmental damage and household income is concave e g resembles an environmental kuznets curve then income inequality is negatively related to total environmental damage results from an empirical analysis of cross national variation indicate that the aggregation effect can run counter to and outweigh the political economy effect for some environmental indicators

testing the food first hypothesis a cross national study of dependency sectoral growth and food intake in less developed countries abstract previous cross national studies on dependency and economic growth in less developed countries ldcs seldom compare the impacts of different kinds of dependency their focus on economic growth also overlooks the fact that growth per se does not necessarily benefit the masses an alternative measure of the absolute living standard of the masses i e food intake is examined in this paper this study analyzes data from 73 ldcs after comparing the effects of manufacturing growth and cereal production growth on food intake this study supports the food first hypothesis derived from lappe and collins 1977 work since it demonstrates that in most ldcs even in middle income ldcs cereal production has a much stronger effect on food intake than does manufacturing growth

the effects of usury laws evidence from the online loan market abstract usury laws cap the interest rates that lenders can charge using data from prosper com an online lending marketplace i investigate the effects of these laws the key to my empirical strategy is that there was initially substantial variability in states interest rate caps ranging from 6 to 36 a behind the scenes change in loan origination however suddenly increased the cap to 36 the main findings of the study are that higher interest rate caps increase the probability that a loan will be funded especially if the borrower was previously just outside the money i do not find however changes in loan amounts and default probability the interest rate paid rises slightly probably because online lending is substantially yet imperfectly integrated with the general credit market

house prices and marital stability we investigate the effect of house price changes on divorce using data for 1991 2010 from the current population survey and the federal housing finance agency our findings suggest that changing house prices significantly affect the share of a cohort that is divorced and that these effects are asymmetric with respect to housing gains versus losses in addition we find differential effects for groups that are more likely to be homeowners versus renters some of this evidence is consistent with homeowners being locked into their homes and hence marriages by increased transactions costs in down markets

economic growth and social development a longitudinal analysis of causal priority abstract the relationship between social and economic development is investigated using a lagged dependent variable model for 46 developing countries for the years 1960 1970 and 1980 our findings indicate that the two types of development are related and lend support to the trickle up hypothesis whether we use a 10 year or a 20 year lag period the physical quality of life index pqli has a significant and positive effect on gross domestic product gdp while gdp does not show a significant lagged effect on pqli the implications of our findings for policy research and implementation are discussed

investigating heterogeneity in brand preferences in logit models for panel data in analyzing panel data the issue of heterogeneity across households is an important consideration if heterogeneity is present but is ignored in the analysis it will result in biased and inconsi

what s in a picture evidence of discrimination from prosper com abstract we find evidence of significant racial disparities in a new type of credit market known as peer to peer lending loan listings with blacks in the attached picture are 25 to 35 percent less likely to receive funding than those of whites with similar credit profiles despite the higher average interest rates charged to blacks lenders making such loans earn a lower net return compared to loans made to whites with similar credit profiles because blacks have higher relative default rates these results provide insight into whether the discrimination we find is taste based or statistical

domestic political conflict and basic needs outcomes an empirical assessment this study undertakes an empirical investigation of the near universal assumption that domestic political conflict is invariably harmful to the societies in which it occurs in particular we examine the implications of domestic conflict for the provision of basic human needs once the known effects of aggregate national wealth are removed using a variation of the panel regression model we regress an index of basic needs satisfaction on measures of domestic conflict scope and intensity along with suitable controls for a sample of 85 contemporary nations the findings indicate that the intensity measure is associated with long term improvements in basic needs while the scope of conflict carries a negative impact for basic needs outcomes

the sound of silence observational learning in the u s kidney market mere observation of others choices can be informative about product quality this paper develops an individual level dynamic model of observational learning and applies it to a novel data set from the u s kidney market where transplant candidates on a waiting list sequentially decide whether to accept a kidney offer we find strong evidence of observational learning patients draw negative quality inferences from earlier refusals in the queue thus becoming more inclined towards refusal themselves this self reinforcing chain of inferences leads to poor kidney utilization despite the continual shortage in kidney supply counterfactual policy simulations show that patients would have made more efficient use of kidneys had the concerns behind earlier refusals been shared this study yields a set of marketing implications in particular we show that observational learning and information sharing shape consumer choices in markedly different ways optimal marketing strategies should take into account how consumers learn from others

rational herding in microloan markets microloan markets allow individual borrowers to raise funding from multiple individual lenders we use a unique panel data set that tracks the funding dynamics of borrower listings on prosper com the largest microloan market in the united states we find evidence of rational herding among lenders well funded borrower listings tend to attract more funding after we control for unobserved listing heterogeneity and payoff externalities moreover instead of passively mimicking their peers irrational herding lenders engage in active observational learning rational herding they infer the creditworthiness of borrowers by observing peer lending decisions and use publicly observable borrower characteristics to moderate their inferences counterintuitively obvious defects e g poor credit grades amplify a listing s herding momentum as lenders infer superior creditworthiness to justify the herd similarly favorable borrower characteristics e g friend endorsements weaken the herding effect as lenders attribute herding to these observable merits follow up analysis shows that rational herding beats irrational herding in predicting loan performance this paper was accepted by pradeep chintagunta marketing

identification of endogenous social effects the reflection problem this paper examines the reflection problem that arises when a researcher observing the distribution of behaviour in a population tries to infer whether the average behaviour in some group influences the behaviour of the individuals that comprise the group it is found that inference is not possible unless the researcher has prior information specifying the compisition of reference groups if this information is available the prospects for inference depend critically on the population relationship between the variables defining reference groups and those directly affecting outcomes inference is difficult to implossible if these variables are functionally dependent or are statistically independent the prospects are better if the variables defining reference groups and those directly affecting outcomes are moderately related in the population

sovereign wealth fund investments in europe as an instrument of chinese energy policy abstract chinese sovereign wealth funds swfs are new instruments of chinese go global strategy and the politics of maintaining raw materials and energy security europe has lured 60 of the total usd 27 3 billion invested by chinese swfs in the energy sector globally which provokes the question as to how important swf investments are in the political sense and what security concerns they bring this paper is the first that presents a comprehensive picture of chinese swf investments in the european energy market and one of the very few papers about swfs based on multiannual comprehensive empirical data the author argues that chinese swfs are different players on the energy market than private investors could be potentially harmful for some european interests by installing representatives on the company boards china gains access to sensitive information that could be then transferred to chinese competitors moreover through its swfs china could take control over energy companies or critical infrastructure and increase its political influence in european countries making them more vulnerable to political pressure therefore the european policy makers should consider taking special steps to monitor and maybe limit chinese swfs expansion in the energy sector

composite indices of physical quality of life basic needs fulfilment and income a principal component representation abstract in the context of international comparisons the multivariate method of principal components is suggested for computing composite indices of economic development that capture per capita income basic needs fulfilment and other possible indicators of well being the method is conceptually appealing easy to apply and seems promising in several directions two illustrative applications are given one develops a composite index based on the three pqli constituents and per capita gnp for 147 countries in the other a composite index of basic needs fulfilment is first computed for 82 countries and then a more inclusive measure that also takes account of per capita gnp is derived

endogeneity and individual consumer choice abstract in many markets there is likely to be correlation both across periods in terms of the choices of one consumer and across consumers in terms of their choices in each period the former is caused by consumer heterogeneity and the latter may be the result of demand common shocks across consumers furthermore if firms partially observe these common shocks their market decisions may end up being endogenous and correlated with the common shocks because researchers cannot typically fully observe consumer heterogeneity and the common shocks the estimation method must account for the endogeneity of firms decisions in this article the authors present a test for endogeneity under unobserved consumer heterogeneity and common shocks which is based on a quasi likelihood estimation method to estimate the model parameters consistently when endogenous firm behavior unobserved heterogeneity and common shocks are present the test examines the differences in general method of moments coefficient estima

demand and supply dynamics for sequentially released products in international markets the case of motion pictures we develop an econometric model to study a setting in which a new product is launched first in its domestic market and only at a later stage in foreign markets and where the product s performance demand and availability supply are highly interdependent over time within and across markets integrating literature on international diffusion success breeds success trends and the theatrical motion picture industry the focus of the empirical analysis we develop a dynamic simultanenous equations model of the drivers and interrelationship of the behavior of consumers audiences and retailers exhibitors our findings emphasize the importance of considering the endogeneity and simultaneity of audience and exhibitor behavior and challenge conventional wisdom on the determinants of box office performance which is predominantly based on modeling frameworks that fail to account for the interdependence of performance and availability specifically we find that variables such as movie attributes and advertising expenditures which are usually assumed to influence audiences directly mostly influence revenuesindirectly namely through their impact on exhibitors screen allocations in addition consistent with the idea that the buzz for a movie is perishable we find that the longer is the time lag between releases the weaker is the relationship between domestic and foreign market performance an effect mostly driven by foreign exhibitors screen allocations

endogeneity and heterogeneity in a probit demand model estimation using aggregate data two issues that have become increasingly important while estimating the parameters of aggregate demand functions to study firm behavior are theendogeneity of marketing activities typically price andheterogeneity across consumers in the market under consideration ignoring these issues in the estimation of the demand function parameters can lead to biased and inconsistent estimates for the effects of marketing activities endogeneity and heterogeneity have achieved prominence in large measure because of the increasing popularity of logit models to characterize demand functions usingaggregate data the logit model accounts for purchase incidence and brand choice by including a no purchase alternative in the consumer s choice set this allows for category sales to change as a function of the marketing activities of brands in the category there are three issues with using the logit model with the no purchase option to characterize demand when studying competitive interactions among firms 1 the marketing literature dealing with brand choice behavior at the consumer level has found that the iia restriction is not appropriate as each brand in the choice set is more similar to some brands than it is to others 2 studies have found that the purchase incidence decision is distinct from the brand choice decision hence it may not be appropriate to model the no purchase decision as just another alternative in the choice set with the iia restriction holding across all brands and the no purchase option 3 even if the distinction between the purchase incidence and brand choice decisions is accounted for via for example a nested logit specification accounting for the purchase incidence decision with aggregate data requires assumptions for computing the share of the no purchase alternative which is otherwise unobserved in this paper we propose a probit model as an alternative to the logit model to specify the aggregate demand functions of firms competing in oligopoly markets the probit model avoids the iia property that affects the logit model at the individual consumer level furthermore the probit model can naturally account for the distinction between the purchase incidence and brand choice decisions due to the general covariance structure assumed for the utilities of the alternatives we demonstrate how the parameters of the proposed model can be estimated using aggregate time series data from a product market in the estimation we account for the endogeneity of marketing variables as well as for heterogeneity across consumers our results indicate that both endogeneity as well as heterogeneity need to be accounted for even after allowing for a non iia specification at the individual consumer level specific to our data we also find that ignoring endogeneity has a bigger impact on the estimated price elasticities than ignoring the effects of heterogeneity a comparison of the elasticities obtained from the probit model with those from the corresponding logit specification indicates that therange of elasticities obtained from the probit model across brands is larger than that obtained from the logit the results have implications for issues such as firm level pricing in addition to specifying a probit model and providing comparisons with the logit model the paper also addresses the third issue raised above we propose a simple alternative to the purchase incidence brand choice specification by decomposing the demand for a brand into a category demand equation and a conditional brand choice share equation we provide a comparison of results from this specification to those from the specification that includes the no purchase alternative and find that estimated elasticities are sensitive to the specification used we also estimate the demand function parameters using a traditional specification such as the double logarithmic model here we find that the estimated elasticities could be signed in such a manner as to be not useful for firm level pricing decisions one of the key limitations of the proposed model is that while it accounts for the purchase incidence and brand choice decisions of households it does not account for differences across consumers in their purchase quantities the model and analysis are best suited for product categories in which consumers typically make single unit purchases another limitation is more practical in nature while recent advances have been made in computing probit probabilities it could nevertheless be a challenge to do so when the number of alternatives is large

intercountry inequalities in income and basic needs indicators a recent perspective abstract large crosscountry samples are used to compute intercountry inequalities in income and three indicators of basic needs fulfillment first the familiar picture of high intercountry inequality in income coexisting with low inequality in basic needs indicators is reaffirmed for the 1980s second income inequality seems to have continued its increasing trend third however while the pace of increase in inequality in conventional gdp per capita has accelerated accentuation of inequality in real gdp per capita has slowed fourth inequality in basic needs indicators continues to decline last caution is urged in interpreting the very low values observed for some indices of inequality in basic needs fulfillment during the 1980s