the power of parties evidence from close municipal elections in norway we show that small shifts in representation can affect policy in proportional election systems using data from norway we find that a larger left wing party leads to more property taxation higher child care spending and less elderly care spending while local public goods appear to be a non partisan issue these effects are partly due to shifts in bloc majorities and partly due to changes in the left right position of the council keeping the majority constant the estimates on spending allocations are rather imprecise but they are consistent with evidence on politicians fiscal preferences and patterns in media attention this article is protected by copyright all rights reserved

occupational choice and the process of development this paper models economic development as a process of institutional transformation by focusing on the interplay between agents occupational decisions and the distribution of wealth because of capital market imperfections poor agents choose working for a wage over self employment and wealthy agents become entrepreneurs who monitor workers only with sufficient inequality however will there be employment contracts otherwise there is either subsistence or self employment thus in static equilibrium the occupational structure depends on distribution since the latter is itself endogenous we demonstrate the robustness of this result by extending the model dynamically and studying examples in which initial wealth distributions have long run effects in one case the economy develops either widespread cottage industry self employment or factory production employment contracts depending on the initial distribution in the other example it develops into prosperity or stagnation

pocketbook voting social preferences and expressive motives in referenda we develop and test a theory of voting and turnout decisions that integrates self interest social preferences and expressive motives our model implies that if pocketbook benefits are relevant voters either perceive their impact on the outcome to be non negligible or expressive motivations do not play a role in the decision on how to vote conversely if own pocketbook benefits do not explain voting then voting is expressive if the perceived probability of being pivotal is non negligible social preferences and expressive concerns are observationally equivalent our empirical analysis studies collective choices which are analogous to decisions on local public goods we consider referenda among university students on whether to collectively purchase deeply discounted flat rate tickets for public transportation and cultural amenities individual usage data allow quantifying the monetary benefits associated with each ticket as voters had precise information on the individual costs and benefits our setting comprises a real world laboratory of direct democracy we find that monetary benefits strongly influence participation and voting however social or expressive motives such as stated altruism environmental concerns and paternalism are decisive for a significant minority our results rule out purely expressive voting and imply that a substantial share of the electorate perceived their impact on the outcome to be non negligible

credit market constraints consumption smoothing and the accumulation of durable production assets in low income countries investments in bullocks in india in this paper we formulate and estimate a finite horizon structural dynamic model of agricultural investment behavior that incorporates the major features of low income agricultural environments income uncertainty constraints on borrowing and rental markets and the use of investment assets to generate income and smooth consumption the model is fit to longitudinal indian household data on farm profits bullock stocks and pump sets the estimated structural parameters are used to assess the effects on the life cycle accumulation of bullocks agricultural profits and welfare associated with complete markets and bullock liquidity and with second best policies that provide assured sources of income to farmers and weather insurance

fiscal policy seasonality and intertemporal substitution of investment spending in the uk abstract the effects of three pre announced changes in fiscal policy on manufacturing investment in equipment and in industrial buildings are estimated using the enger granger two step procedure the strong seasonal variation in the expenditure series is interpreted as an economic process within the same framework

empirical implications of alternative models of firm dynamics abstract this paper considers two models of firm behavior that allow for heterogeneity among firms idiosyncratic or firm specific sources of uncertainty and discrete outcomes exit and or entry both the characteristics of firm level panel data sets and the nature of the questions we characteristically ask of them imply that models with these features are likely to underlie most detailed empirical work on microdata sets the models we consider are a bayesian learning model due to jovanovic 20 and a model of research and exploration due to ericson and pakes 11 the paper provides a simple set of empirical procedures to help determine which if either of these two models might be appropriate for alternative data sets we conclude by checking for the implications of the two models on an eight year panel of wisconsin firms the results indicate that one model is consistent with the data on manufacturing firms while the other is consistent with the data on retail trade journal of economic literature classification numbers c52 l60 l80

social incentives and voter turnout evidence from the swiss mail ballot system this paper uses a natural experiment to document the impact of social pressure on voting behavior the main hypothesis is that social pressure creates incentives to vote for the purpose of being seen at the voting act this incentive is particularly high in small and close knit communities empirically i analyze the effect of postal voting on voter participation in switzerland optional postal voting decreased the voting costs but simultaneously removed the social pressure to vote in spite of the large reduction in voting costs the effect on aggregate turnout was small however voter participation was more negatively affected in the smaller communities this lends support to the view that social incentives played a role for certain people s voting decisions jel h0 z13

authority versus persuasion this paper studies a principal s trade off between using persuasion versus using interpersonal authority to get the agent to do the right thing from the principal s perspective when the principal and agent openly disagree on the right course of action it shows that persuasion and authority are complements at low levels of effectiveness but substitutes at high levels furthermore the principal will rely more on persuasion when agent motivation is more important for the execution of the project when the agent has strong intrinsic or extrinsic incentives and for a wide range of settings when the principal is more confident about the right course of action this abstract was borrowed from another version of this item

tax limits and local elections this paper exploits variation in tax limits across over 7000 italian municipalities during the 2000s to investigate their impact on voter turnout and local election outcomes the empirical analysis is based on a panel data estimator on about 14 000 municipal elections during the 2001 2010 decade and on a quasi experimental approach focusing on the fiscal limitation treatment of municipalities local income surcharge freeze in the years 2001 and 2006 where the trajectory of local turnout in the concurrent general elections is used as the counterfactual the evidence suggests that tax limits provoke a a modest fall in voter turnout in mayoral elections b a mild decrease in the number of mayoral candidates c a sizeable widening of elected mayors win margins and some improvement in mayors valence proxies the evidence is compatible with the hypothesis that the imposition of tax limits lowers the ideological stakes of local elections favors party line crossing and promotes vote convergence based on the valence of candidates

do closeness and stake increase voter turnout evidence from election results in small french towns in brittany abstractdo closeness and stake increase voter turnout evidence from election results in small french towns in brittany regional studies this article explores the determinants of second round voter turnout in small french towns with a focus on two hypotheses first an increase in the closeness of the race may lead to an increase in turnout second a higher seats stake that is a higher proportion of the total number of seats that remain to be filled in the second round of the election may increase turnout results show that increases in both closeness and seats stake lead to higher voter turnout thus evidence is given in favour of the assumption of rationality in voting in local elections

investment crowding out firm level evidence from northern germany michalek j ciaian p and kancs d a investment crowding out firm level evidence from northern germany regional studies the main objective of this paper is to estimate the extent to which firm investment is substituted crowded out by investment support policies granted under the european union rural development programme rdp the empirical analyses employed the difference in difference propensity score matching approach which allows several important sources of bias to be addressed such as selection bias simultaneity bias and functional form misspecification from which many previous studies suffer using panel data of 1333 firms from the schleswig holstein region in germany it is found that the crowding out effect of the rdp is close to 100 implying that firms use public support to substitute for private investments furthermore no evidence was found that due to the rdp programme support firms would have brought forward their investments planned originally for a later period rejecting t

income distribution and macroeconomics this paper analyzes the role of wealth distribution in macroeconomics through investment in human capital it is shown that in the presence of credit markets imperfections and indivisibilities in investment in human capital the initial distribution of wealth affects aggregate output and investment both in the short and in the long run as there are multiple steady states this paper therefore provides an additional explanation for the persistent differences in per capita output across countries furthermore the paper shows that cross country differences in macroeconomic adjustment to aggregate shocks can be attributed among other factors to differences in wealth and income distribution across countries

the effects of location based tax policies on the distribution of household income evidence from the federal empowerment zone program abstract location based tax policies are redistributive as evidenced by their placement in distressed areas however the previous literature has focused on mean effects which can mask important effects that the program has on the distribution of households therefore we extend the literature by studying changes in the entire household income distribution in the context of the federal empowerment zone ez program we do not find evidence that the impoverished residents benefited from the program our findings are consistent with the areas becoming more attractive to high income households the improvements in the areas were concentrated in those portions of each zone that were relatively better off prior to ez designation the results confirm the prior literature findings that the areas on average became more attractive but also suggest that the benefits of the program likely did not accrue to the lower income residents of the ez areas

concurrent elections and turnout causal estimates from a german quasi experiment conventional wisdom suggests that scheduling elections concurrently with other contests increases turnout however causal empirical evidence in favor of this claim is scarce at best moreover it is a priori unclear whether theory would predict a higher turnout if two low office elections are combined instead of a combination of a low office election and a major electoral race using a quasi experiment and a difference in differences estimation approach at the german municipality level i provide evidence that combining two low office elections significantly increases turnout

organized crime and business subsidies where does the money go abstract business support policies are widespread in advanced countries to foster employment and productivity this paper analyses the role of organized crime in the allocation of public subsidies to businesses we assemble an innovative data set on the italian mafia at municipality level and test whether mafia ridden municipalities receive a disproportionally higher amount of funds we exploit exogenous variation at municipality level to instrument mafia activity and show that the presence of organized crime positively affects the probability of obtaining funding and the amount of public funds organized crime is also found to lead to episodes of corruption in the public administration sector a series of robustness checks confirms the above findings

green efficiency and environmental subsidy evidence from thermal power firms in china abstract to achieve green development ample environmental subsidies have been invested into many energy intensive firms such as thermal power firms in china investigations of the effects of this kind of subsidy can help to provide specific and important implications for ongoing regulations unlike previous studies on the national regional or sectoral level this paper measures green efficiency and its compositions of thermal power firms and studies the impact of environmental subsidies on green efficiency by using the classical slacks based measure and tobit model the results show that the average green efficiency ranges from 0 509 to 0 663 during 2010 2015 which is much lower than the general efficiency the green scale efficiency is the main reason for the low green efficiency thus indicating large room for improvement environmental subsidies negatively affect green efficiency and its decompositions from 2010 to 2013 the negative effect becomes weak and insignificant in 2014 and the environmental subsidies start to significantly promote green efficiency and its decompositions in 2015 according to our findings some implications relating to improving green scale efficiency increasing the intensity of environmental subsidies to firms and strengthening their supervision are proposed

regional selective assistance in scotland does it make a difference to plant productivity this paper examines whether receipt of a regional selective assistance rsa grant has a causal impact on plant total factor productivity tfp to tackle the problem of self selection into the treatment group propensity score matching is employed in order to control for the endogeneity of other variables in the model estimations are performed using the system gmm estimator the results show that for low technology manufacturing receipt of an rsa grant leads to a fall in tfp

explaining voter turnout patterns an information theory voting research is rich in empirical regularities yet a parsimonious theory of voter turnout that can match the facts has proven to be elusive this paper argues that voter turnout patterns can be explained by extending the traditional rational voter model to include limited information a model is presented in which utility maximizing consumers receive higher payoffs from voting the more confident they are of their vote choice the model provides an explanation for the most important cross sectional voter turnout patterns in addition it suggests a novel explanation for the post 1960 decline in u s participation

public subsidies tfp and efficiency a tale of complex relationships this paper evaluates the impact of subsidies on the different components of tfp for granted firms long term growth the impact of capital subsidies is captured by a quasi experimental method multiple rdd exploiting the conditions for a local random experiment created by an italian industrial policy results show that capital subsidies negatively affect tfp growth in the short term and signals of positive effects appear only after 3 4 years this positive medium long term impact comes especially through technological change and not through scale impact change as may have been expected

decomposition of productivity growth using distance functions the case of dairy farms in three european countries within an output distance function framework the total factor productivity growth index is decomposed into four components technical change technical and allocative efficiency and scale component we estimate stochastic translog output distance functions using panel data from dairy farms over the period 1991 94 for three european countries germany the netherlands and poland results indicate that the change in the productivity growth index in germany 6 and poland 5 are mainly dictated by the technical change component in contrast the productivity growth index in the netherlands 3 is influenced by allocative efficiency components

local choice of property taxation evidence from norway fiscal competition may influence the design of tax systems the tax competition literature has concentrated on mobility of tax base and tax levels while we turn the attention to the political decision making system and the determination of tax structure in the norwegian setting local governments make a discrete choice whether to have property tax the local choice is investigated in an econometric model allowing for yardstick competition our results indicate that yardstick competition explains the distinct geographic pattern in local property taxation observed grants have no effect on the propensity to have property taxation consistent with the flypaper effect the main methodological challenge handled concerns spatial interaction with discrete choice

growth economies of scale and targeting in japan 1955 1990 this paper explores the usage of various industrial policy tools in japan contrary to the conventional wisdom the authors find that a disproportionate amount of japanese targeting occurred in low growth sectors and sectors with decreasing returns to scale in addition they find no evidence that productivity was enhanced as a result of industrial policy measures copyright 1996 by mit press

evaluating the impact of investment incentives the case of italy s law 488 1992 abstract italy s law 488 1992 allows firms willing to invest in lagging areas to receive a public subsidy by comparing subsidized firms with firms with rejected applications this paper evaluates whether the program made investments possible that otherwise would not have been made we find evidence that financed firms brought forward investment projects originally planned for the post intervention period to take advantage of the incentives we also find some support that subsidized firms may have taken some of the investment opportunities that unsubsidized firms would have exploited in the absence of incentives

investment tax incentives prices and the supply of capital goods using data on the prices of capital goods this paper shows that much of the benefit of investment tax incentives does not go to investing firms but rather to capital suppliers through higher prices the reduction in the cost of capital from a 10 percent investment tax credit increases equipment prices 3 5 7 0 percent this lasts several years and is largest for assets with large order backlogs low import competition or with a large fraction of buyers able to use investment subsidies capital goods workers wages rise too instrumental variables estimates of the short run supply elasticity are around 1 and can explain the traditionally small estimates of investment demand elasticities in absolute value the demand elasticity implied here exceeds 1

selection on observed and unobserved variables assessing the effectiveness of catholic schools in this paper we measure the effect of catholic high school attendance on educational attainment and test scores because we do not have a good instrumental variable for catholic school attendance we develop new estimation methods based on the idea that the amount of selection on the observed explanatory variables in a model provides a guide to the amount of selection on the unobservables we also propose an informal way to assess selectivity bias based on measuring the ratio of selection on unobservables to selection on observables that would be required if one is to attribute the entire effect of catholic school attendance to selection bias we use our methods to estimate the effect of attending a catholic high school on a variety of outcomes our main conclusion is that catholic high schools substantially increase the probability of graduating from high school and more tentatively attending college we find little evidence of an effect on test scores

local natural resource curse abstract utilizing an output based efficiency measure we investigate whether higher public revenues harm efficiency in the production of local public goods much variation in revenues among norwegian local governments can be explained by revenues collected from hydropower production this revenue variation combined with good data availability can be used to address a main concern in the resource curse literature that public sector revenue and in particular the revenue from natural resources is endogenous we obtain an exogenous measure of local revenue by instrumenting the variation in hydropower revenue and thus total revenue by topology average precipitation and meters of river in steep terrain we find support for what we term the paradox of plenty hypothesis that higher local government revenue reduces the efficiency in production of public goods we do not find support for what we term the rentier state hypothesis that revenue derived from natural resources should harm efficiency more than revenue derived from other sources such as taxation

climbing the ranks incumbency effects in party list systems abstract incumbents tend to have a solid electoral advantage in candidate centered electoral settings do similar incumbency effects exist in more party centered environments we estimate incumbency effects in an open list proportional representation system exploiting that seats are first allocated across parties and then to candidates within party lists using data from norwegian local elections 2003 2015 we document that a candidate that barely wins a seat in the local council has about a 9 percentage points 43 higher probability of being elected in the next election compared to a candidate that just misses out on a seat on the same party list we find no evidence that voters contribute to this personal incumbency advantage rather it seems as if party elites are instrumental in securing the electoral success of their party affiliates we show that incumbents and non incumbents run again in the subsequent election at about equal rates but that incumbents tend to advance in the party hierarchy and obtain safer ballot positions in future elections which is what ultimately leads to electoral success

the importance of legitimacy within organizations there are typically limits to leaders legitimacy this article explores how organizations are structured in the face of such constraints the concept of legitimacy is formalized in the context of a single agent moral hazard model the principal can give the agent monetary incentives in addition he can give the agent an order the agent finds it costly to disobey orders provided they are legitimate we find that it may be optimal for the principal to take costly actions to bolster legitimacy we argue that many organizational phenomena can be understood as attempts to bolster legitimacy examples include rejection of overqualified workers bureaucracy merger decisions and above market clearing wages

temporal aggregation of univariate and multivariate time series models a survey abstract we present a unified and up to date overview of temporal aggregation techniques for univariate and multivariate time series models explaining in detail although intuitively the technical machinery behind the results some empirical applications illustrate the main issues

dynamic effects of permanent and temporary tax policies in a q model of investment abstract this paper incorporates the tax policy analysis of hall and jorgenson into a dynamic optimizing model with adjustment costs to develop a q model of investment this framework is particularly useful for analyzing the dynamic effects on investment of permanent and temporary changes in tax policy it is shown that contrary to the conventional intertemporal substitution argument a temporary investment tax credit need not be nore expansionary than a permanent investment tax credit the role of depreciation allowances in determining the dynamic response of investment to temporary changes in the tax rate is also investigated

too much investment a problem of asymmetric information this paper shows that under plausible assumptions the inability of lenders to discover all of the relevant characteristics of borrowers results in investment in excess of the socially efficient level raising the rate of interest above the free market level will restore optimality this conflicts with generally held views and is contrasted with the stiglitz weiss model it is shown that the assumptions which yield overinvestment support debt as the equilibrium method of finance however under the stiglitz weiss assumptions used to derive an underinvestment result equity is shown to be the equilibrium method of finance

the incidence of mandated maternity benefits i consider the labor market effects of mandates which raise the costs of employing a demographically identifiable group the efficiency of these policies will be largely dependent on the extent to which their costs are shifted to group specific wages i study several state and federal mandates which stipulated that childbirth be covered comprehensively in health insurance plans raising the relative cost of insuring women of childbearing age i find substantial shifting of the costs of these mandates to the wages of the targeted group correspondingly i find little effect on total labor input for that group jel 118 j32 h51 in an era of tight fiscal budget constraints mandating employer provision of workplace benefits to employees is an attractive means for a government to finance its policy agenda consequently in recent years there has been a growth of interest in mandated benefits as a tool of social policy for example the centerpiece of president bill clinton s health care proposal is mandated employer provision of health insurance and more than 20 states have man

toward an economic theory of leadership leading by example this paper explores leadership within organizations leadership is distinct from authority because following a leader is a voluntary rather than coerced activity of the followers this paper considers how a leader induces rational agents to follow her in situations when the leader has incentives to mislead them copyright 1998 by american economic association

do subsidies to private capital boost firms growth a multiple regression discontinuity design approach there is still little consensus among economists on the effectiveness of business support policies the evaluation of such policies requires a reliable identification procedure that is hardly achieved in empirical studies we analyse the impact of a policy instrument law 488 92 l488 the main italian regional policy that allocates subsidies to private firms by a multiple ranking system thanks to the peculiar l488 selection process that creates the conditions for a local random experiment we are able to assess the effectiveness of these types of incentives for a relevant subgroup of firms we propose a nonparametric multiple rankings regression discontinuity design that exploits the sharp discontinuities in the l488 rankings and extends the regression discontinuity design rdd approach to a context where the treatment is assigned by multiple rankings with different cut off points we find that the impact of the subsidies on employment investment and turnover is positive and statistically significant while the effect on productivity is mostly negligible the new subsidised capital is additional but non complementary with the owner financed investment the results are robust to different specifications and not due to intertemporal substitution

abstention in elections with asymmetric information and diverse preferences we analyze a model of a two candidate election with costless voting in which voters have asymmetric information and diverse preferences we demonstrate that a strictly positive fraction of the electorate will abstain and that nevertheless elections effectively aggregate voters private information using examples we show that more informed voters are more likely to vote than their less informed counterparts increasing the fraction of the electorate that is informed however may lead to higher levels of abstention we conclude by showing that a biased distribution of information can lead to a biased voting population but does not lead to biased outcomes

television and voter turnout i use variation across markets in the timing of television s introduction to identify its impact on voter turnout the estimated effect is significantly negative accounting for between a quarter and a half of the total decline in turnout since the 1950s i argue that substitution away from other media with more political coverage provides a plausible mechanism linking television to voting as evidence for this i show that the entry of television in a market coincided with sharp drops in consumption of newspapers and radio and in political knowledge as measured by election surveys i also show that both the information and turnout effects were largest in off year congressional elections which receive extensive coverage in newspapers but little or no coverage on television

the swing voter s curse in the laboratory this paper reports the first laboratory study of the swing voter s curse and provides insights on the larger theoretical and empirical literature on pivotal voter models our experiment controls for different information levels of voters as well as the size of the electorate the distribution of preferences and other theoretically relevant parameters the design varies the share of partisan voters and the prior belief about a payoff relevant state of the world our results support the equilibrium predictions of the feddersen pesendorfer model and clearly reject the notion that voters in the laboratory use naive decision theoretic strategies the voters act as if they are aware of the swing voter s curse and adjust their behavior to compensate while the compensation is not complete and there is some heterogeneity in individual behavior we find that aggregate outcomes such as efficiency turnout and margin of victory closely track the theoretical predictions

are bureaucrats paid like ceos performance compensation and turnover of top civil servants abstract recent research explores the effect of financial and career incentives on public sector hiring processes and subsequent performance the reverse relation between performance and bureaucrats compensation and turnover has received only limited attention due to the distinct features of public sector organizations bureaucrats are traditionally argued to require either permanent positions and fixed wages or low powered performance incentives this article studies how the performance of top civil servants in norwegian local governments affects their compensation and turnover we thereby build on a unique new dataset over the period 1991 2014 our results indicate that better performing top civil servants obtain a higher compensation and are less likely to be replaced nonetheless these incentives remain low powered in line with agency theory prescriptions

local favoritism in at large proportional representation systems abstract pork barrel spending is typically attributed to the strategic behavior of political elites hoping to be electorally rewarded by voters residing in their districts such behavior is expected to depend on the incentives imposed by the electoral system we estimate the causal effect of local representation in a closed list proportional representation system where individual candidates have no clear electoral incentive to favor their hometown using data from norwegian regional governments we still find a hometown bias we document that municipalities with a representative on the regional council from the same party as the regional governor tend to obtain more funding for local investments citizens also tend to vote more often for parties whose gubernatorial candidate is from their own hometown consistent with expectations of particularistic benefits a possible explanation is that regional council members are often recruited from local politics and remain loyal to their roots we find no evidence that regional council experience affects politicians future career prospects at the local level

the effects of operating and capital subsidies on total factor productivity a decomposition approach past studies relied on ad hoc associations to establish relationships between productivity on one hand and operating and capital subsidies on the other this article deviates from these studies it builds on recent research based on private cost to derive a total factor productivity formula that includes subsidy effects it specifies an empirical model to estimate the required parameters to apply the formula the application to urban transit systems shows that the effects of these subsidies on productivity through technical change reinforce the decline in productivity sakano obeng and azam 1997 applied the stochastic frontier method to public transit data and decomposed allocative inefficiency between internal factors and subsidies they found that the internal factors contributed more toward allocative inefficiencies and subsidies accounted for less than 25 of the technical inefficiencies in transit firms these authors also found operating subsidies to be the major sources of the inefficiencies and that capital subsidies mostly acted as a counterbalancing factor in reducing the inefficiencies these findings suggest that both subsidies play opposing roles in affecting performance and inefficiency and that while capital subsidies increase partial productivity measures operating subsidies may reduce them these effects of subsidies on partial productivity will also affect total factor productivity tfp therefore there is a link between operating and capital subsidies and tfp and we must find a way to decompose the changes in tfp such that we can identify the effects of subsidies this decomposition is the motivation for this article we develop a decomposition method for tfp that permits the contributions of subsidies to be isolated and apply the method to public transit data the article therefore makes contributions in both methodology and application the basis of the decomposition is an extension of the methods discussed in obeng 1994 obeng and azam 1997 and sakano obeng and azam 1997 to derive a tfp measure that depends on subsidies these methods hold that firms maximize output subject to a net cost constraint where net cost is total cost less operating and capital subsidies the dual of this constrained output maximization is that firms minimize their private cost subject to a production function constraint this objective is different from those frequently adopted in the public transit

the craft of labormetrics using a wide array of examples from the literature and from original estimates the author examines the pitfalls that make good empirical research in labor economics at least as much craft as statistical technique among the subjects discussed are the appropriateness and cleanliness of data problems of extreme observations the validity of attempts to produce exogeneity using instrumental variables natural experiments and structural models and the treatment of selectivity and unobservable individual effects the author stresses the importance of testing empirical results to ensure that they make sense and of presenting them clearly and economically

assessing the incidence and efficiency of a prominent place based policy abstract this paper empirically assesses the incidence and efficiency of round i of the federal urban empowerment zone ez program using confidential microdata from the decennial census and the longitudinal business database using rejected and future applicants to the ez program as controls we find that ez designation substantially increased employment in zone neighborhoods and generated wage increases for local workers without corresponding increases in population or the local cost of living the results suggest the efficiency costs of first round ezs were relatively modest jel h26 h77 j31 r23 r58

balladurette and juppette a discrete analysis of scrapping subsidies this paper studies the effects of subsidies on durable goods markets in particular we focus on a recent policy in france in which the governments of balladur and juppe subsidized the replacement of old cars with new ones to study this policy we construct a dynamic stochastic discrete choice model of car ownership at the household level the resulting decision rules and equilibrium conditions are used to estimate the underlying parameters of the model using aggregate data these policy functions are used to evaluate the short and long run effects of the french policies we find that these policies do stimulate the automobile sector in the short run but through the induced changes in the cross sectional distribution of car ages create the basis for subsequent low activity further while these policies increase government revenues in the short run revenues in the long run are lower relative to a baseline without intervention

a structural model of turnout and voting in multiple elections this paper develops a unified approach to study participation and voting in multiple elections the theoretical setting combines an uncertain voter model of turnout with a spatial model of voting behavior we apply our framework to the study of turnout and voting in u s presidential and congressional elections we structurally estimate the model using individual level data for the 2000 elections and quantify the relationships between observed individual characteristics and unobserved citizens ideological preferences information and civic duty we then use the estimated model which replicates the patterns of abstention selective abstention split ticket voting and straight ticket voting observed in the data to assess the effects of policies that may increase citizens information and sense of civic duty on their turnout and voting behavior

your vote counts on account of the way it is counted an institutional solution to the paradox of not voting when we explicitly lay out all its steps we find that the paradox of not voting since the chance of one vote s making a difference is about zero why trouble to vote rests on a false but hitherto unremarked assumption about the institutional context of elections my solution to the paradox is more conservative than others that have been proposed and it yields a rational choice model of voting whose consequence accord well with empirical findings on turnout

turnout and closeness evidence from 60 years of bavarian mayoral elections one prediction of the calculus of voting is that electoral closeness positively aects turnout via a higher probability of one vote being decisive i test this theory with data on all mayoral elections in the german state of bavaria between 1946 and 2009 importantly i use constitutionally prescribed two round elections to measure electoral closeness and thereby improve on existing work that mostly uses expost measures that are prone to endogeneity the results suggest that electoral closeness matters a one standard deviation increase in closeness increases turnout by 1 68 percentage points which corresponds to 1 of a standard deviation in this variable i also evaluate how other factors like electorate size or rain on election day aect turnout dierentially depending on the closeness of the race

economic theories of voter turnout i the voting paradox why would the rational individual bother to spend time and resources to become well informed go to the polls on the election day and maybe even wait in a queue why would a rational voter vote downs 1957 ii the paradox of indeterminacy if they vote why do they care who they vote for kirchgassner 1992 kirchgassner and pommerehne 1993 iii the paradox of ignorance to the extent that information is costly the rational voter must be ignorant about relevant aspects of his decision making downs 1957

investment tax incentives and frequent tax reforms despite the frequency of tax changes and their potential importance to investors almost all of the analysis of tax based investment incentives assumes investors never anticipate any tax changes we depart from this approach by analyzing the historical pattern of u s corporate investment incentives over the period 1953 86 incorporating the feature of investor awareness that the tax code may change our analysis incorporates a predictive equation for future tax variables into a model of optimal investment subject to adjustment costs and uncertainty we find that expectations of future tax changes significantly affect the incentive to invest only if adjustment costs are low in this case the incentive to invest in 1986 was strong as investors are estimated to have anticipated the coming reduction in investment incentives this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item

government programs can improve local labor markets evidence from state enterprise zones federal empowerment zones and federal enterprise communities 1 abstract federal and state governments spend well over a billion dollars a year on programs that encourage employment development in disadvantaged labor markets through the use of subsidies and tax credits in this paper we use an estimation approach that is valid under relatively weak assumptions to measure the impact of state enterprise zones entzs federal empowerment zones empzs and federal enterprise community entc programs on local labor markets we find that all three programs have positive statistically significant impacts on local labor markets in terms of the unemployment rate the poverty rate the fraction with wage and salary income and employment further the effects of empz and entc designation are considerably larger than the impact of entz designation we find that our estimates are robust to allowing for a regression to the mean effect we also find that there are positive but statistically insignificant spillover effects to neighboring census tracts of each of these programs thus our positive estimates of these program impacts do not simply represent a transfer from the nearest non treated census tract to the treated census tract our results are noteworthy for several reasons first our study is the first to jointly look at these three programs thus allowing policy makers to compare the impacts of these programs second our paper along with a concurrent study by neumark and kolko 2008 is the first to carry out the estimation accounting for overlap between the programs third our estimation strategy is valid under weaker assumptions than those made in many previous studies we consider three comparison groups and let the data determine the appropriate group fourth in spite of our conservative estimation strategy by looking at national effects with disaggregated data we show that entz designation generally has a positive effect on the local labor market while most previous research on entzs much of which used more geographically aggregated data to look at state specific effects did not find any significant impacts fifth we note that there is little or no previous work on entcs overall our results strongly support the efficacy of these labor market interventions

optimal dissent in organizations we model an organization as a two agent hierarchy an informed decision maker in charge of selecting projects and a possibly uninformed implementer in charge of their execution both have intrinsic preferences over projects this paper models the costs and benefits of divergence between their preferences that is dissent within the organization dissent is useful to 1 foster the use of objective and sometimes private information in decision making and 2 give credibility to the decision maker s choices however dissent comes at the cost of hurting the implementer s intrinsic motivation thereby impairing organizational efficiency we show that dissent can be optimal in particular when information is useful and uncertainty is high moreover dissent remains an optimal organizational form even when implementers can choose their employer or when decision makers have real authority over hiring decisions

evaluating the employment impact of a mandatory job search program this paper exploits area based piloting and age related eligibility rules to identify treatment effects of a labor market program the new deal for young people in the u k a central focus is on substitution displacement effects and on equilibrium wage effects the program includes extensive job assistance and wage subsidies to employers we find that the impact of the program significantly raised transitions to employment by about 5 percentage points the impact is robust to a wide variety of nonexperimental estimators however we present some evidence that this effect may not be as large in the longer run jel j18 j23 j38

the measurement and sources of technical inefficiency in the indonesian weaving industry production function models are estimated with a time series of cross section data on indonesian weaving establishments the sources of technical inefficiency are investigated three firm attributes are identified as being potentially related to firm efhciency tbey are firm ownership age and size the importance of these attributes as sources of inefficiency in the indonesian weaving industry is investigated and the implications of the find ings discussed

follow the leader theory and evidence on political participation using state by state voting data for u s presidential elections the authors observe that voter turnout is a positive function of predicted closeness to explain the strategic component of political participation they develop a follow the leader model political leaders expend effort according to their chance of being pivotal which depends on the expected closeness of the race at both state and national levels and how voters respond to their effort structural estimation supports this model for example a 1 percent increase in the predicted closeness at the state level stimulates leaders efforts which increases turnout by 0 34 percent

optimal monetary policy under low trend inflation abstract in the monetary policy literature it is common to assume that trend inflation is zero despite overwhelming evidence that zero inflation is neither empirically relevant nor a practical objective for central bank policy we therefore extend the standard new keynesian model to allow for positive trend inflation showing that even low trend inflation has strong effects on optimal monetary policy and the dynamics of inflation output and interest rates under discretion the efficient policy deteriorates and there is no guarantee of determinacy even with commitment targeting non zero trend inflation leads to substantial welfare losses our results serve as a warning against indiscriminate use of models assuming zero trend inflation

the swing voter s curse the authors analyze two candidate elections in which some voters are uncertain about the realization of a state variable that affects the utility of all voters they demonstrate the existence of a swing voter s curse less informed indifferent voters strictly prefer to abstain rather than vote for either candidate even when voting is costless the swing voter s curse leads to the equilibrium result that a substantial fraction of the electorate will abstain even though all abstainers strictly prefer voting for one candidate over voting for another copyright 1996 by american economic association

the effectiveness of r d subsidies a meta regression analysis of the evaluation literature widespread and increasing public subsidy for research and development r d has given rise to a large and growing number of evaluation studies while economic theory identifies market failures that justify public support theory also suggests reasons why returns might be disappointing similarly the empirical literature investigated 52 micro level studies published since 2000 on either input or output r d reports a wide range of findings the lack of conclusiveness both of theory and of the evaluation literature motivate this meta regression analysis mra this study contributes to policy debate by identifying a representative subsidy effect after controlling for publication selection bias and for a wide range of sample and study heterogeneities mra findings reject crowding out of private investment by public subsidy but reveal no evidence of substantial additionality in addition among the research practices explaining the heterogeneous effects reported in this literature those related to the treatment of unobservable firm heterogeneity are particularly important

the price of pork the seniority trap in the u s house abstract using data on federal outlays and u s house elections i estimate the effect of the pork barrel on the quality of officeholders taking into account the fact that seniority creates a dynamic linkage across periods after estimating the parameters governing the influence of seniority on federal outlays and the parameters governing the distributions of candidate quality i conduct several policy experiments to uncover the size of the welfare loss created by the seniority system i find that the seniority system negatively impacts the quality of representatives but has little effect on the outcomes of elections furthermore the most commonly proposed solution to the distortion term limits may have a significant negative effect on the quality of sitting representatives instead of a quantity constraint term limits i propose a change in the relative price of seniority by way of a pigouvian tax on seniority such a policy achieves the first best outcome

competing for global capital or local voters the politics of business location incentives the competition for global capital has led to interjurisdictional competition between countries states and cities as to who can offer the most attractive incentives to firms in this study we examine the domestic politics of this competition by focusing on incentive use in the united states from 1999 to 2012 we define incentives as the targeted tax deductions or exemptions that are used to lure businesses into a locality drawing on data from municipal incentive programs we examine how electoral competition shapes the use and oversight of targeted incentives we find evidence that cities with elected mayors provide larger incentives than non elected city managers by taking advantage of exogeneity in the assignment of city government institutions and a database of over 2000 investment incentives from 2010 to 2012 we also find that elected mayors enjoy more lax oversight of incentive projects than their appointed counterparts our results have important implications for the study of interjurisdictional competition and the role of electoral institutions in shaping economic policy

leadership coordination and corporate culture what is the role of leaders in large organizations we propose a model in which a leader helps to overcome a misalignment of followers incentives that inhibits coordination while adapting the organization to a changing environment good leadership requires vision and special personality traits such as conviction or resoluteness to enhance the credibility of mission statements and to eectively rally agents around them resoluteness allows leaders to overcome

the impact of federal spending on house election outcomes while it is widely believed by academics politicians and the popular press that incumbent members of congress are rewarded by the electorate for bringing federal dollars to their district the empirical evidence supporting that claim is extremely weak one explanation for the failure to uncover the expected relationship between federal spending and election outcomes is that incumbents who expect to have difficulty being reelected are likely to exert greater effort in obtaining federal outlays since it is generally impossible to adequately measure this effort the estimated impact of spending is biased downward because of an omitted variable bias we address this estimation problem using instrumental variables for each house district we use spending outside the district but inside the state containing the district as an instrument for spending in the district federal spending is affected by a large number of actors e g governors senators mayors and other house members in the state delegation