are the self employed really jacks of all trades testing the assumptions and implications of lazear s theory of entrepreneurship with german data using a large representative german data set and various concepts of self employment this paper tests the jack of all trades view of entrepreneurship by lazear am econ rev 94 2 208 211 2004 consistent with its theoretical assumptions we find that self employed individuals perform more tasks and that their work requires more skills than that of paid employees in contrast to lazear s assumptions however self employed individuals do not just need more basic but also more expert skills than employees our results also provide rather limited support for the idea that human capital investment patterns differ between those who become self employed and those ending up in paid employment

imf programs do they work can they be made to work better abstract a central issue in the debate about a new international financial architecture has been whether programs of policy reform supported by the international monetary fund work the fund claims that on balance they do because of their positive effect on the balance of payments others claim that programs are ineffective and suggest that they should be discontinued this paper reviews the econometric evidence dealing with the macroeconomic effects of imf programs it goes on to provide additional evidence and judges success against alternative criteria although the record is not good the paper argues that it would be unwise for the fund to cease lending and to abandon conditionality altogether imf programs need to be redesigned and refocused the paper concludes by identifying a number of principles that should underpin reform

adoption of an imf programme and debt rescheduling an empirical analysis the existence of an empirical relationship between the adoption of an imf programme and the concession of a debt rescheduling by commercial and official creditors is tested using a bivariate probit model if countries who have arrangements with the imf are more likely than others to obtain a rescheduling of their external debt we could conclude that the adoption of an imf programme could work as a sort of signal of a country s good willingness which is thus rewarded with the debt relief the results confirm the existence of a significant effect of the adoption of an imf programme on the subsequent concession of a debt rescheduling by creditors

role of parental income in educational attainment during the post world war ii era u s governmental policy has often been based on the idea that in the absence of government action access to college and to a lesser extent high school education may be limited because of liquidity constraints the federal and state and local governments have instituted a number of policies to overcome these constraints these policies include the basic opportunity grants loan programs that have been issued at or below market interest rates the expansion of state supported colleges that charge below market tuitions rates and the inception and expansion of local community or county colleges that also charge below market tuition rates while there may be noneconomic reasons that explain these changes or their magnitude economic reasons that rely on differences between private and social costs and benefits can also be advanced these include a wiser societal choices made by a more educated society b recoupment of social costs from higher tax revenues c the reduction of private risks from lending arising from the pooling of risks thereby making the social supply of funds curve available to all individuals at the social discount rate and d state and local economic development reason c implies that in the absence of governmental initiative some children would be restricted from achieving their socially optimal amount of education because parents income and wealth limit their children s choices gary becker 1975 arthur okun 1975 and jere behrman and myself 1985 argue that governmental policy to reduce private borrowing costs to the level of social costs reduces inefficiency while increasing equity a rare result in the realm of economics in this paper i consider why parental income might influence offspring s educational attainment and the policy implications of such an influence

the demand for imf credits by sub saharan african countries abstract in this paper the demand behaviour of sub saharan african countries for imf credits will be studied on the basis of pooled cross section and time series analysis it will be concluded that drawings on imf facilities are not a purely economic phenomenon

are women graduates jacquelines of all trades challenging lazear s view on entrepreneurship this study challenges the basic reasoning behind lazear s theory on entrepreneurship 2005 based on the key motive of maximizing one s lifetime income lazear posits that individuals with a balanced set of skills should have a higher probability of being self employed his jack of all trades hypothesis presumes that entrepreneurs need sufficient knowledge in a variety of areas to succeed while paid employees benefit from being specialists in a certain area demanded by the labor market because most women led businesses are neither based on the motive of making money nor are they growth oriented we argue that maximizing their lifetime income is not the main motivation of many women to start a business however we argue that lazear s theory can be extended to motivations that are mostly stated for women entrepreneurs as well we apply it to a specific representative sample of 1384 women graduates in germany and test our hypothesis with logit regression a dichotomized measure indicating whether a women graduate was self employed n 706 or not n 678 served as the dependent variable our results widely confirm lazear s assumption for women graduates who run relatively small businesses in terms of sales and employment professional training balanced industry experience and balanced entrepreneurship based self efficacy increase the probability of being self employed solo self employed tend to have balanced industry experience more often than those being in a team or having employees lazear s theory has male as the norm and as such does not readily apply to the case of women but could and should be extended to women s specifics

security analysis and trading patterns when some investors receive information before others in existing models of information acquisition all informed investors receive their information at the same time this article analyzes trading behavior and equilibrium information acquisition when some investors receive common private information before others the model implies that under some conditions investors will focus only on a subset of securities herding while neglecting other securities with identical exogenous characteristics in addition the model is consistent with empirical correlations that are suggestive of oft cited trading strategies such as profit taking short term position reversal and following the leader mimicking earlier trades in existing models of information acquisition all informed investors receive their information at the same time while these models provide many important insights in reality some investors either fortuitously or owing to superior skill acquire pertinent information before others by being first an investor can exploit this information to great advantage information that is uncovered only slightly later is less valuable even if it has not yet been publicly revealed we show in this article that the sequential nature of information arrival has a significant effect on both the trading decisions and the types of information collected by investors the model we develop describes the investment choices of a set of competitive risk averse investors who investigate the long term prospects of firms lucky or high ability investors uncover the

geopolitics and international organizations an empirical study on imf facilities there is growing awareness that the distribution of imf facilities may not be influenced only by the economic needs of borrowers this paper focuses on the fact that the imf may favour geopolitically important countries in the distribution of imf loans differentiating between concessional and non concessional facilities to carry out the empirical analysis we construct a new database that compiles a wide array of proxies for geopolitical importance for 107 imf countries over 1990 2003 focusing on emerging and developing economies we use a factor analysis to capture the common underlying characteristic of countries geopolitical importance as well as a potential analysis since we also want to account for the geographical situation of the loan recipients while controlling for economic and political determinants our results show that geopolitical factors influence notably lending decisions when loans are non concessional whereas results are less robust and in opposite direction for concessional loans this study provides empirical support to the view that geopolitical considerations are an important factor in shaping imf lending decisions potentially affecting the institution s effectiveness and credibility

bilateral treaties and the most favored nation clause the myth of trade liberalization in the nineteenth century textbook accounts of the anglo french trade agreement of 1860 argue that it heralded the beginning of a liberal trading order this alleged success holds much interest from a modern policy point of view for it rested on bilateral negotiations and most favored nation clauses with the help of new data on international trade the ricardo database the authors provide empirical evidence and find that the treaty and subsequent network of mfn trade agreements coincided with the end of a period of unilateral liberalization across the world they also find that it did not contribute to expanding trade at all this is contrary to a deeply rooted belief among economists economic historians and political scientists the authors draw a number of policy lessons that run counter to the conventional wisdom and raise skepticism toward the ability of bilateralism and mfn arrangements to promote trade liberalization

momentum investment strategies portfolio performance and herding a study of mutual fund behavior this study analyzes the extent to which mutual funds purchase stocks based on their past returns as well as their tendency to exhibit herding behavior i e buying and selling the same stocks at the same time the authors find that 77 percent of the mutual funds were momentum investors buying stocks that were past winners however most did not systematically sell past losers on average funds that invested on momentum realized significantly better performance than other funds the authors also find relatively weak evidence that funds tended to buy and sell the same stocks at the same time copyright 1995 by american economic association

entrepreneurship and innovation networks in this paper we give a general introduction to the notion of entrepreneurship and how it has many complex meanings entrepreneurs in new firms but also in incumbent firms have a key role in local regional and national economic development by taking risks to get things done by developing new combinations of ideas and or doing things differently in view of this two of the main questions that are dealt with are 1 which features make structural differences in institutions and innovation networks remain invariant between decades and 2 how knowledge about such features can be employed in policy at the national and the regional level the research questions highlighted in this special issue relate to many pertinent national and regional policy issues the most apparent concerns conditions conducive for entrepreneurship in the form of new firms and firm growth in this paper we also introduce the different contributors to this special issue

do exchange rates affect the capital labour ratio panel evidence from canadian manufacturing industries using industry level data for canadian manufacturing industries from 1981 to 1997 we find empirical evidence of a negative relationship between the capital labour ratio and the user cost of capital relative to the price of labour a 10 increase in the user cost of the machinery and equipment m e relative to the price of labour results in a 3 3 decrease in the m e labour ratio in the long run assuming complete exchange rate pass through into imported m e prices the maximum effect of a permanent 10 depreciation in the exchange rate is a 1 7 decline in the m e labour ratio this result implies that the cumulative growth of the m e labour ratio during the 1991 to 1997 period would have been 2 3 percentage points higher had the dollar not depreciated this may appear to be significant but considering both m e as a share of total capital and the capital share of nominal output are both approximately one third in terms of a simple growth accounting framework the effect on labour productivity is small

crisis in the eye of the beholder economic crisis and partisan politics in latin american and east european international monetary fund programs this article analyzes the interaction between economic crises and partisan politics during international monetary fund program initiation in latin america in the 1980s and eastern europe in the 1990s the author argues that economic crises are at least in part in the eye of the beholder and therefore policy responses reflect the interaction between crisis intensity and the government s partisan interpretation of the crisis which in turn depends on the nature of the economic crisis and its broader regional and international environment using cross country statistical evidence from the two regions the article shows that certain types of crises such as liquidity shortfalls elicit similar responses across the ideological spectrum and regional contexts by contrast debt repayment and domestic crises are more prone to divergent ideological interpretations but the extent of partisan divergence is context sensitive in that it occurred during the latin american debt crisis but not in the post communist tra

an analysis of drawings on the international monetary fund by developing countries the nature of relations between the imf and developing countries has come under close scrutiny in recent years this has partly been the result of the deteriorating economic situation in which a large number of non oil developing countries have found themselves a situation characterised by falling rates of economic growth increasing balance of payments deficits and rising debt service ratios and partly it has resulted from the particular but public experiences of a number of developing countries such as jamaica peru and tanzania in their dealings with the fund

urban wages and labor market agglomeration abstract using the 5 public use micro sample of the 1990 u s census we find that observationally equivalent workers in the manufacturing sector earn higher wages when they are in urban labor markets that have a larger share of national or metropolitan employment in their same occupation and industry groups quantitatively the effect is large with an elasticity measured at the means of between 1 2 and 3 6 for these effects we interpret the willingness of firms to pay more for equivalent workers in dense markets as evidence of an agglomeration economy in urban labor

foreign debt versus domestic debt in the euro area the aftermath of the 2008 financial crisis has led to a sharp rise in public debt throughout the developed world the problem is particularly acute within the euro area where several governments needed financial assistance from the international monetary fund and the european stability mechanism this paper argues that public debt poses much greater problems when it is owed to foreigners i e when it constitutes foreign debt this view implies that the key to overcoming the euro crisis is in the external adjustment not the fiscal adjustment another implication is that in a crisis a strong fiscal adjustment is desirable not because it can immediately reduce the public debt gdp ratio but because it reduces domestic absorption and thus reinforces the external adjustment copyright 2013 oxford university press

wages in high tech start ups do academic spin offs pay a wage premium due to their origin in universities academic spin offs operate at the forefront of technological development therefore academic spin offs exhibit a skill biased labour demand i e academic spin offs have a high demand for employees with cutting edge knowledge and technical skills in order to accommodate this demand academic spin offs may have to pay a relative wage premium compared to other high tech start ups however neither a comprehensive theoretical assessment nor the empirical literature on wages in start ups unambiguously predicts the existence and the direction of wage differentials between academic spin offs and non spin offs this paper addresses this research gap and examines empirically whether or not academic spin offs pay their employees a wage premium using a unique linked employer employee data set of german high tech start ups we estimate mincer type wage regressions applying the hausman taylor panel estimator our results show that academic spin offs do not pay a wage premium in general however a notable exception to this general result is that academic spin offs that commercialise new scientific results or methods pay a wage premium to employees with links to the university sector either as university graduates or as student workers

the effect of imf programs on economic growth abstract using a bivariate dynamic version of the heckman selection model we estimate the effect of participation in international monetary fund imf programs on economic growth we find evidence that governments enter into agreements with the imf under the pressures of a foreign reserves crisis but they also bring in the fund to shield themselves from the political costs of adjustment policies program participation lowers growth rates for as long as countries remain under a program once countries leave the program they grow faster than if they had remained but not faster than they would have without participation

the democratic advantage institutional foundations of financial power in international competition despite their presumed liabilities institutions associated with democracy serve as a source of power in prolonged international competition by increasing the financial resources that states can bring to bear the theory of sovereign debt suggests that a state s ability to raise money through public borrowing is enhanced when debtholders have mechanisms for sanctioning state leaders in the event of default institutions associated with liberal government provide such mechanisms all other things being equal states that possess these institutions enjoy superior access to credit and lower interest rates than do states in which the sovereign has more discretion to default unilaterally liberal states can not only raise more money from a given economic base but can also pursue tax smoothing policies that minimize economic distortions the ability to finance competition in a manner that is consistent with long term economic growth generates a significant advantage in prolonged rivalries these claims are explored by analyzing the anglo french rivalry 1688 1815 and the cold war

exchange rate regimes in developing and emerging economies and the incidence of imf programs summary the global economic crisis will compel many countries to revise key economic policies including their exchange rate regime the international monetary fund will have significant influence on their choices and has exhibited a bias against intermediate regimes we examine the link between exchange rate regimes and imf program use and find no evidence that countries with intermediate exchange rate regimes require more frequent imf assistance rather they appear somewhat less dependent especially when compared to fixed exchange rates our results suggest that intermediate regimes should remain a viable and possibly desirable exchange rate choice for some countries

optimal maturity of government debt without state contingent bonds abstract this paper shows that state contingent debt can be synthetically constructed using non contingent debt of different maturities a main policy implication of this principle is that the ramsey allocation with complete markets can be sustained with non contingent debt only by properly managing its maturity structure the numerical experiments however suggest that this policy implication ought to be taken with care we find that the debt positions that sustain the ramsey allocation are very high on the order of a few hundred times total gdp for a very simple four state economy and increasing in the number of states in addition they are very sensitive to small variations in the parameters of the model

the peaceful conspiracy bond markets and international relations during the pax britannica this article provides foundations to polanyi s famed argument that monopoly power in the global capital market served as an instrument of peace during the pax britannica 1815 1914 our perspective is novel we focus on the role of intermediaries and certification we show that when information and enforcement are imperfect there is scope for the endogenous emergence of prestigious intermediaries who enjoy a monopoly position and as a result control government actions they can implement conditional lending they subject the distribution of credit to the adoption of peaceful policies prestigious intermediaries act that way because of their concern with maintaining an unblemished track record when wars increased risks of default our analysis which brings together insights from different disciplines provides a significant extension to and departure from recent research on how countries accumulate reputational capital

macroeconomic performance and adjustment under policies commonly supported by the international monetary fund the fundamental objective of any adjustment program whether supported by the international monetary fund imf or otherwise is to eliminate disequilibrium between aggregate demand and supply which is typically reflected in balance of payments deficits and rising prices in the past the imf stabilization programs were basically demand side the focus on the demand management is based on the absorption and especially the monetary approach to the balance of payments in recent years however the imf has recognized the importance of supply factors and thus adjustment programs include policy tools that deal with production bottlenecks ways to improve resource utilization and so forth this shift in policy does not however imply that the imf attaches less significance to demand than supply factors in his recent paper mohsen khan states that although supply shocks can cause disequilibrium between aggregate demand and supply often such imbalances can be traced to inappropriate policies that expand aggregate demand too rapidly relative to the growth of the productive capacity in the economy the purpose of this article is to examine directly the effects that a typical stabilization program may have on three important macroeconomic variables the growth rate in real output economic growth the inflation rate and the current account balance to provide some empirical foundation for the analysis the effects of such programs are illustrated through regression analysis three models that examine the relationship between relevant macroeconomic variables and the imf s instrumental tools are introduced the analysis covers 43 countries of which 27 are program countries that used imf financial resources during 1977 the period under study is 1977 83 during 1976 77 the

debt and default in the 1930s causes and consequences abstract this paper studies interwar experience with external debt and default it begins with a description of the contours of international borrowing and lending in the 1920s we then use some empirical models from recent literature on the 1970s to describe the interwar data macroeconomic variables for over 20 countries are related to cross section variations in borrowing and debt during the period from the end of the 1920s to 1938 the paper then considers the incidence and correlates of sovereign default for 1934 1938 using regression to determine the association between standard measures of economic structure and performance and subsequent interruptions to debt service such variables as the magnitude of the debt burden the deterioration of the terms of trade during the great depression and the stance of monetary and fiscal policies provide a remarkably accurate explanation of the incidence of default we go on to provide a long run perspective on default and on the remedies available to creditors the provisions of loan contracts are reviewed with an eye toward analyzing the scope for renegotiation the discussion emphasizes the contrast between the regime of bond finance that prevalied in the interwar years and the current regime of bank lending we analyze the roles of governments banks and bondholders protective committees in the negotiation process we then present new estimates of the ex post realized rates of return on british and american foreign lending in the 1920s this empirical analysis uncovers a striking contrast in the returns realized on loans floated in the two countries while the nominal internal rate of return on dollar loans was less than 1 per annum the comparable return on sterling loans was in excess of 5 the paper concludes with a discussion of factors which help to account for this dramatic difference

internet start ups access to the bank loan market evidence from italy the analysis of the bank sector s ability to efficiently fuel the birth of new italian business ventures in internet related services is studied in particular through the specification and the estimate of a series of econometric models this paper aims at investigating which characteristics of a large sample of internet start ups and their relative founders facilitate access to the loan market more precisely the role played by founders human capital as a possible significant signal used by banks to evaluate investment projects is addressed estimation results suggest that highly qualified human resources possessed by internet founders do not represent an important driver for gaining access to bank credit and they do not affect the amount of the incurred debt

firm size and job quality a survey of the evidence from germany small firms provide and create a large proportion of jobs in germany are these jobs worse than jobs in larger firms the mosaic picture that emerges from a review of several recent empirical studies using german individual or firm level micro data shows that all in all wages are lower non wage incomes fringes are lower job security is lower work organisation is less rigid institutionalized possibilities for workers participation in decision making are weaker and opportunities for skill enhancement are worse in small firms compared to large firms the weight of evidence therefore indicates that on average small firms offer worse jobs than large firms it is argued that there is no need for policy measures targeted to improve job quality in small firms because higher incomes in large firms can in part be seen as compensating differentials for more rigid work organisation and can follow from wage policies to reduce shirking and turnover that is more costly in large than in small firms furthermore a lower level of remuneration less protection against dismissals a lower level of workers participation and less opportunities for further training all contribute to lower costs in small firms that might be needed to compensate for size related cost disadvantages compared to large firms economic policy should concentrate on keeping barriers to entrepreneurs entry to markets low to foster new firm formation and creative destruction

an evaluation of the swedish system of active labour market programmes in the 1990s we investigate the presence of short and long term effects from joining a swedish labor market program vis a vis more intense job search in open unemployment overall the impact of the program system is found to have been mixed joining a program has increased employment rates among participants a result robust to a misclassification problem in the data on the other hand it has also allowed participants to remain significantly longer on unemployment benefits and more generally in the unemployment system this being particularly the case for those entitled individuals entering a program around the time of their unemployment benefits exhaustion

are nascent entrepreneurs jacks of all trades a test of lazear s theory of entrepreneurship with german data in a recent paper edward lazear proposed the jack of all trades view of entrepreneurship based on a coherent model of the choice between self employment and paid employment he shows that having a background in a large number of different roles increases the probability of becoming an entrepreneur the intuition behind this proposition is that entrepreneurs must have sufficient knowledge in a variety of areas to put together the many ingredients needed for survival and success in a business while for paid employees it suffices and pays to be a specialist in the field demanded by the job taken this study contributes to the entrepreneurship literature by empirically testing lazear s hypothesis using a large recent representative sample of the german population the empirical estimation takes the rare events nature of becoming a nascent entrepreneur and the regional stratification of the sample into account the results illustrate the statistical significance and economic importance of the jack of all t

why do we have nominal government debt abstract we study the choice between nominal and indexed debt in a stochastic macroeconomic model with discretionary monetary and fiscal policy with distortionary taxes nominal debt provides valuable insurance against the budgetary effects of economic fluctuations we show that a welfare maximizing government always issues some nominal debt even though nominal debt increases inflation along the time consistent path of the economy the result is fairly robust with respect to changes in assumptions about policy constraints and about the macroeconomic setting

macroeconomic impacts of the korean financial crisis comparison with the cross country patterns this paper analyzes the macroeconomic adjustment process of the korean financial crisis in a broad international perspective in particular the impacts of the crisis on gdp growth inflation current account balance and employment are analyzed using a cross country data set which compiled 150 financial crisis episodes from all developing countries that have received conditional financial assistance from the imf over the period from 1973 to 1994 the cross country patterns show that gdp growth rates sharply drop with the eruption of a crisis but then recover quickly to the pre crisis level in two or three years showing a v pattern of adjustment inflation and current account deficit exhibit an inverse v pattern but they do not improve to the level of non program period employment growth is most sluggish in the recovery process compared with other macroeconomic variables we find that the korean case is in general consistent with these stylized patterns however the degree of initial contraction and following recovery has been far greater in korea than what the cross country evidence predicts cross country comparison indicates that both the export oriented structure and the swift adjustment of macroeconomic policies contributed to the speedy adjustment of the korean economy this abstract was borrowed from another version of this item

testing expected utility maximization under price and quantity risk with a heterogeneous panel refutable implications based on the curvature properties of the indirect utility function for the competitive firm operating under uncertainty are extended to the case of both price and quantity uncertainty using unit roots and cointegration tests for heterogeneous panels a model of us agricultural production is developed based on the time series properties of a panel of state level data most refutable hypotheses under output price and output quantity risk are not rejected but symmetry conditions implied by a twice continuously differentiable indirect utility function are rejected the same test conclusions are obtained from a traditional model that presumes stationarity in all variables

historical research on international lending and debt the parallels between debt crises past and present have attracted a large number of social scientists to the history of foreign lending and default in this article i describe the findings of the recent literature on the subject the questions posed have obvious relevance to the current policy debate over the debt of less developed countries what features of international capital markets have long rendered them vulnerable to generalized crisis what events tend to spawn debt servicing difficulties and to provoke default what have been the consequences of default for lenders and borrowers what approaches historically have proven most effective at clearing away the residue of debt crises i concentrate on 20th century experience on the lending of the 1920s on the debt crisis of the 1930s and on the recovery of capital markets after world war ii

economic determinants of imf financial arrangements abstract we analyze factors that lead to imf approval of financial arrangements we account for both economic variables that induce a country to seek an imf arrangement demand side factors and macroeconomic policy commitments that the imf considers when deciding whether to approve it supply side factors using a pooled sample of annual observations for 91 developing countries over 1973 1991 we obtain maximum likelihood bivariate and univariate probit estimates of the approval of an imf arrangement for a given country in a given year a number of demand side and supply side variables are statistically significant determinants of the approval of an imf arrangement

reconsidering monetary policy an empirical examination of the relationship between interest rates and nominal gdp growth in the u s u k germany and japan abstract the rate of interest the price of money is said to be a key policy tool economics has in general emphasised prices this theoretical bias results from the axiomatic deductive methodology centring on equilibrium without equilibrium quantity constraints are more important than prices in determining market outcomes in disequilibrium interest rates should be far less useful as policy variable and economics should be more concerned with quantities including resource constraints to investigate we test the received belief that lower interest rates result in higher growth and higher rates result in lower growth examining the relationship between 3 month and 10 year benchmark rates and nominal gdp growth over half a century in four of the five largest economies we find that interest rates follow gdp growth and are consistently positively correlated with growth if policy makers really aimed at setting rates consistent with a recovery they would need to raise them we conclude that conventional monetary policy as operated by central banks for the past half century is fundamentally flawed policy makers had better focus on the quantity variables that cause growth

imf lending programs participation and impact abstract participation in imf programs has been an option that more and more developing countries have exercised in recent years in this paper a detailed analysis of such participation over the period 1976 1986 provides a number of insights into the motivations for and the macroeconomic effects of such participation participation is driven by a combination of past performance present external influences and sluggish adjustment of developing countries the ability to predict which countries will participate in the imf program is quite good with nearly 90 percent of variation in such choices accounted for by the explanatory variables employed increased participation has as contemporaneous effects a reduction in economic growth and domestic investment and an improvement in the current account lagged effects of increased participation on economic growth and domestic investment are positive and in most estimates quantitatively greater than the contemporaneous effects there is also evidence of significantly lower public investment an increased budget surplus and real depreciation of the exchange rate with increased participation results for domestic credit creation and government current expenditure although they have a sign consistent with more austere policy cannot be shown to be significantly different from those not participating

evidence on discrimination in employment codes of color codes of gender there is substantial racial and gender disparity in the american economy as we will demonstrate discriminatory treatment within the labor market is a major cause of this inequality the evidence is ubiquitous careful research studies that estimate wage and employment regressions help wanted advertisements audit and correspondence studies and discrimination suits that are often reported by the news media yet there appear to have been periods of substantial reductions in economic disparity and discrimination for example donohue and heckman provide evidence that racial discrimination declined during 1965 1975 1 gottschalk has produced statistical estimates that indicate that discrimination against black males dropped most sharply between 1965 and 1975 and that discrimination against women declined during the interval 1973 1994 2 but some unanswered questions remain why did the movement toward racial equality stagnate and eventually decline after the mid 1970s what factors are most responsible for the remaining gender inequality what is the role of the competitive process in the elimination or reproduction of discrimination in employment

feeling the blues moral hazard and debt dilution in eurobonds before 1914 debt mutualisation through eurobonds has been proposed as a solution to the euro crisis although this proposal found some support it also attracted strong criticisms as it risks raising the spreads for strong countries diluting legacy debt and promoting moral hazard by weak countries because eurobonds are a new addition to the policy toolkit there are many untested hypotheses in the literature about the counterfactual behaviour of markets and sovereigns this paper offers some tests of the issues by drawing from the closest historical parallel five guaranteed bonds issued in europe between 1833 and 1913 the empirical evidence suggests that contemporary concerns about fiscal transfers and debt dilution may be overblown and creditors moral hazard may be as much of a problem as debtors

introduction to special issue of small business economics on female entrepreneurship in developed and developing economies research into entrepreneurship has for many years been interested in the differences in rate of participation and performance by female entrepreneurs the motivation for considering female entrepreneurship in both developing and developed countries arises from our increasing understanding of the significance of the role of women in creating running and growing businesses as a fundamental driver for economic growth this special issue examines the reasons for differences in gender participation across levels of development using empirical studies

sovereign states bondholders committees and the london stock exchange in the nineteenth century 1827 68 new facts and old fictions this paper unpacks the role of foreign bondholders committees in influencing market access following a default during the era before the creation of the british corporation of foreign bondholders cfb in 1868 i argue that many ideas about this period need to be revisited in particular my evidence which uses archival work to describe market microstructures shows the importance of the london stock exchange lse as a court of arbitration i show how the lse general purpose committee set up a system of collective action clauses requiring majority agreement among bondholders to permit market access i argue that unlike what research has argued thus far this created powerful incentives for bondholders to get organized as they did previous models and historical lessons need to be recast copyright 2013 oxford university press

do newly founded firms pay lower wages first evidence from germany using a linked employer employee data set for germany this paper analyses wage setting in a cohort of newly founded and other establishments from 1997 to 2001 while theory provides alternative explanations for higher or lower wages in newly founded firms we show empirically that start ups tend to pay lower wages ceteris paribus on average wages in newly founded establishments are 8 lower than in similar incumbent firms this negative wage differential is substantially smaller in eastern than in western germany the wage differ ential is shown to decline over time as the newly founded firms become more mature

ageing and entrepreneurial preferences previous research on age and entrepreneurship assumed homogeneity and downplayed age related differences in the motives and aims underlying enterprising behaviour we argue that the heterogeneity of entrepreneurship influences how the level of entrepreneurial activity varies with age using a sample of 2 566 respondents from 27 european countries we show that entrepreneurial activity increases almost linearly with age for individuals who prefer to only employ themselves self employers whereas it increases up to a critical threshold age late 40s and decreases thereafter for those who aspire to hire workers owner managers age has a considerably smaller effect on entrepreneurial behaviour for those who do not prefer self employment but are pushed into it by lack of alternative employment opportunities reluctant entrepreneurs our results question the conventional wisdom that entrepreneurial activity declines with age and suggest that effective responses to demographic changes require policy makers to pay close attention to the heterogeneity of entrepreneurial preferences

enhanced debt management solving the eurozone crisis by linking debt management with fiscal and monetary policy abstract unconventional approaches to suit unusual circumstances have become acceptable in monetary policy a formerly highly conservative discipline in this paper it is argued that unconventional approaches should also be considered in sovereign debt management in order to contribute to resolving the eurozone sovereign debt crisis first the troika crisis lending to indebted sovereign borrowers in the eurozone is reviewed and compared with standard imf post crisis lending the main difference and shortcoming is the unsustainable character of the eurozone approach due to the omission of demand stimulation components to address this and other shortcomings the features of an ideal alternative funding tool are identified it would solve the funding problems of affected sovereigns help stabilise the banking system but most of all stimulate domestic demand and hence end the vicious downward spiral it is found that this funding method can be implemented as part of enhanced public debt management by each nation s debt management office

the diana project pioneering women studying pioneering women the 2007 winner of the international award for entrepreneurship and small business research is the diana project team candida brush nancy carter elizabeth gatewood patricia greene and myra hart the diana project builds on the vast experience of the team in the field of entrepreneurship in general and women entrepreneurship business growth and venture capital in particular the diana project has investigated the supply and demand side of growth capital for women entrepreneurs the research contributes to entrepreneurship theory as well as to practice filling a void in knowledge on growth oriented women entrepreneurship in this article we present and discuss the research contribution of the diana project in the areas of entrepreneurship women entrepreneurship and venture capital we specifically discuss the value of researching a specific group of women entrepreneurs those who want to grow their businesses that very clearly demonstrates the positive potential of female entrepreneurship the diana project has also moved research on women s entrepreneurship forward since its framework does not treat women entrepreneurs as other i e the project does not presuppose that women s entrepreneurship is similar to or different from men s entrepreneurship it assumes that women s entrepreneurship is entrepreneurship and studies it from that point of view

risk balanced skills and entrepreneurship this paper proposes that risk aversion encourages individuals to invest in balanced skill profiles making them more likely to become entrepreneurs by not taking this possible linkage into account previous research has underestimated the impacts of both risk aversion and balanced skills on the likelihood individuals choose entrepreneurship data on dutch university graduates provide an illustration supporting our contention we raise the possibility that even risk averse people might be suited to entrepreneurship and it may also help explain why prior research has generated somewhat mixed evidence about the effects of risk aversion on selection into entrepreneurship

import competition employment and wage in us manufacturing new evidence from multivariate panel cointegration analysis this paper examines whether employment and wages in the us manufacturing sector exhibit any long run relationship with import competition the results based on a multivariate panel cointegration analysis of observations on 12 two digit sic manufacturing industries over the period from the third quarter of 1982 to the fourth quarter of 1992 indicate that us manufacturing employment does not bear a long run relationship with import competition but manufacturing wage does while the long run correlation between import price and manufacturing wage is found to be sector sensitive panel estimation reveals a highly significant negative correlation between import price and manufacturing wage

survey evidence on diffusion of interest and information among investors abstract questionnaire surveys of institutional and individual investors were undertaken to learn about patterns of communications it was found that direct interpersonal communications are very important in investor decisions questions elicited what fraction of investors were unsystematic and allowed themselves to be influenced by word of mouth communications or other salient stimuli randomly sampled investors were studied as well as investors in stocks whose price had recently increased dramatically contagion or epidemic models of financial markets are proposed in which interest in individual stocks is spread by word of mouth the survey evidence is interpreted as supporting such models

examining the employer size wage premium in the manufacturing retail trade and service industries using employer employee matched data economists have long sought to understand why large employers pay higher wages than small employers despite decades of study and analysis researchers have been unsuccessful in fully accounting for the employersize wage premium one problem has been insufficient data most empirical efforts to examine the size related wage premium rely on worker level data that contain little information about a worker s employer or firm level data that lack information on the characteristics of a firm s workforce although more recent attempts exploit newly developed employer employee matched data kevin t reilly 1995 troske 1999 most matched data sets cover only limited segments of the population thus raising doubt about the generality of the findings in this paper we use the recently created new worker establishment characteristics database nwecd to examine the employer size wage premium unlike other matched data sets the nwecd contains information on workers and employers in all sectors and regions of the econ

evaluating the effect of imf lending to low income countries the purpose of this paper is twofold to apply to a group of low income borrowers from the imf the most commonly used technique for measuring the independent effects on economic developments of imf support and to develop a minimum set of diagnostic tests for determining whether necessary conditions for using the methodology exist the modified control group methodology is used to measure the effect of imf support on three key variables output growth inflation and the external debt rservice ratio the sample comprises adjustment programs begun during 1986 1991 supported by the imf s enhanced structural adjustment facility esaf the distinguishing feature of the modified control group approach is the estimation of a policy counterfactual policies that would have been followed in the absence of imf support against which to compare actual policies and resulting outcomes using this approach for the esaf the sample reveals statistically significant beneficial effects of imf support on output growth and the debtrservice ratio but no effects on inflation diagnostic tests of these results rarely if ever reported in the literature are shown to be critical in interpreting the validity of the results of assessments of adjustment lending for this sample at least the diagnostic tests cast doubt on the reliability of estimates of the effects of imf supported programs using panel data in a modified control group model the most obvious and manageable modifications to the

sovereign debt as intertemporal barter author s kletzer kenneth m wright brian d abstract borrowing and lending between sovereign parties is modeled as intertemporal barter that smoothes the consumption of a risk averse party subject to endowment shocks the surplus anticipated in the relationship offers sufficient incentive for cooperation by all parties including any other competitive agents who are potential lenders to the sovereign the sole punishments consist of renegotiation proof changes in the path of future payments we show that intertemporal trade can be sustained in the absence of any exogenous enforcement of lending relationships whatsoever that is borrowing and lending are possible under anarchy and are supported by punishments that consist of cheating any cheater long term implicit relationships may be fulfilled as the continual renegotiation of simple incomplete short term loans the analysis suggests that the crucial role of the explicit loan contract is the identification of the relationship and the parties involved

the imf forever an analysis of the prolonged use of fund resources considerable concern has been expressed about the prolonged use made of international monetary fund imf resources by a number of member countries some commentators have seen this as being fundamentally at odds with the role of the imf as a source of temporary balance of payments support and as one aspect of mission creep by the fund the perceived importance of the issue is reflected by the fact that the first report of the fund s independent evaluation office focused on it this article provides a detailed analysis of the prolonged use of fund resources it assesses the extent to which it is a problem and draws on available empirical evidence both qualitative and quantitative to isolate the causes of prolonged use it concludes by examining the policy questions to which prolonged use gives rise

the economic characteristics of imf program countries abstract a logit analysis is utilized to identify the factors that characterized developing nations that entered imf stabilization programs in the early 1980s program countries recorded higher rates of domestic credit growth larger shares of government expenditure more severe current account deficits smaller reserve holdings and lower per capita incomes

new firms and labor market entrants is there a wage penalty for employment in new firms in this paper we explore the role of new firms as an entry point to the labor market because the vast majority of new firms are short lived it is a risky decision to accept employment in a new venture it can be argued that individuals with little or no labor market experience are more willing to accept the high risks associated with employment in new firms hence new firms may work as an entry point to the labor market nevertheless some research concludes that one disadvantage of employment in a new firm is that new firms pay less shane in small bus econ 33 141 149 2009 however this empirical conclusion is primarily based on literature on the wage penalty of small firms in this paper we study whether the wage penalty of employment in a new firm persists if we focus solely on labor market entrants in the empirical analysis we employ an employer employee matched dataset that covers the swedish population during the period from 1998 to 2008 we use the propensity score matching method to study the wage differences between labor market entrants employed in new and incumbent firms we find an average wage penalty of 2 9 for labor market entrants employed in new firms over the studied period

sovereign debt the assessment this article serves as an introduction to two issues of the oxford review of economic policy one entitled sovereign debt understanding bond markets during the eurozone crisis and the second sovereign debt lessons from the past reforms for the future we begin by documenting recent trends in advanced country sovereign indebtedness and reviewing events that preceded the sovereign debt crisis in the eurozone the mechanisms through which rising sovereign debt may impact bond yields economic growth and inflation are discussed and the evidence for such effects is reviewed our discussion highlights that there is no unique threshold beyond which sovereign debt exerts adverse macroeconomic effects and that in order to understand the consequences of a given debt load one must analyse its structure in terms of internal and external creditors currency denomination the time to maturity of the bonds and the legal code governing debt issuance as well as various economic and political constraints measuring the fiscal space of the sovereign we then turn our attention to episodes in which sovereign debt proves excessive and default occurs we review explanations for the protracted and inefficient nature of defaults and describe some lessons from historical studies examining default outcomes in the final part of the paper we discuss proposals for averting future debt crises including jointly issued bonds such as eurobonds contingent convertible bonds and elements of a sovereign debt restructuring mechanism in the course of our discussion we draw on each of the 11 articles included in the two issues of this journal devoted to sovereign debt copyright 2013 oxford university press

analyzing the returns to entrepreneurship by a modified lazear model a modified version of lazear s model in american economic review 94 208 211 2004 journal of labor economics 23 649 680 2005 for occupational choice is formulated it includes a utility adjustment factor that captures the combined effect of nonpecuniary benefits and uncertainty associated with entrepreneurship we show that the counterfactual income returns to entrepreneurship are lower than the market value of entrepreneurial talent and higher than the inverse of the utility adjustment factor moreover if the skill profiles in the population are frechet distributed the ratio between the expected incomes of entrepreneurs and observationally similar wage employees is lower than the inverse of the utility adjustment factor thus entrepreneurs will on average earn less than wage employees if the utility adjustment factor is greater than or equal to one it is also shown that the self selection bias related to this income ratio or returns measure increases with the observed percentage of entrepreneurs swedish employment data are used to calibrate the modified lazear model the empirical results indicate that uncertainty considerations might be more important for the occupational choices than nonpecuniary benefits