government capital and the production function for u s private output abstract theoretical and policy discussions make unsupported assumptions about the productivity of capital which governments own estimates of an aggregate production function for u s private business 1949 1973 show government capital to be significant statistically and in economic terms

nonseparable preferences frisch labor supply and the consumption multiplier of government spending one solution to a fiscal policy puzzle this paper proposes a theoretical explanation of the positive consumption multipliers of government spending often found in the data the explanation requires two ingredients first labor demand expands e g prices are sticky second general nonseparable preferences over consumption and leisure should be such that the two goods are substitutes that is frisch labor supply elasticity is lower than the constant consumption elasticity this implies that constant consumption labor supply shifts left existing empirical evidence on the relative magnitudes of the two elasticities supports this hypothesis the parametric conditions under which the result occurs are consistent with restrictions of concavity and noninferiority of consumption and leisure

the effect of public capital in state level production functions reconsidered using a panel data set for the forty eight contiguous states from 1970 to 1983 several estimates are provided of a cobb douglas production function with three types of public capital as inputs various specification tests are systematically applied to test for both random and fixed state effects nonstationarity endogeneity of the private inputs and measurement error in the preferred specification which is first differences with fixed state effects the public capital variables are not significant while the fixed state effects and private input variables are significant copyright 1996 by mit press

sentiments and aggregate demand fluctuations we formalize the keynesian insight that aggregate demand driven by sentiments can generate output fluctuations under rational expectations when production decisions must be made under imperfect information about demand optimal decisions based on sentiments can generate stochastic self fulfilling rational expectations equilibria in standard economies without persistent informational frictions externalities nonconvexities or strategic complementarities in production the models we consider are deliberately simple but could serve as benchmarks for more complicated equilibrium models with additional features

eductive stability in real business cycle models we reexamine issues of coordination in the standard rbc model is the unique rational expectations equilibrium attainable by rational agents who contemplate the possibility of small deviations from equilibrium surprisingly we nd that coordination cannot be expected even with strong common knowledge assumptions rational agents anticipating small but persistent deviations are led to take actions that eventually contradict the common knowledge assumption this impossibility theorem for eductive learning is not fully overcome when adaptive learning is incorporated into the framework

fiscal policy and growth in a small open economy with elastic labour supply endogenizing labour supply leads to fundamental changes in the equilibrium structure of the ak growth model of a small open economy the balanced growth equilibrium is described by two tradeoff loci relating the equilibrium growth rate to the fraction of time devoted to leisure the implications of endogenous labour supply for fiscal policy are addressed the effects of distortionary taxes and government expenditure on the equilibrium growth leisure employment tradeoff are analysed the responses contrast with both those of a closed economy having an elastic labour supply and an open economy with fixed labour supply optimal fiscal policy is also characterized jel classification f41 f43 politique fiscale et croissance dans une petite economie ouverte quand l offre de travail est elastique l endogeneisation de l offre de travail entraine des changements fondamentaux dans la structure d equilibre du modele de croissance du type ak d une petite economie ouverte l equilibre de croissance balancee est decrit par deux lieux de relations d equivalence reliant le taux de croissance d equilibre a la fraction du temps allouee au loisir on examine les implications de cette endogen6isation de l offre de travail pour la politique fiscale on analyse les effets de taxes distorsionnantes et des depenses gouvemementales sur la relation d 6equivalence entre taux de croissance et loisir et donc emploi on obtient des reactions differentes de celles qu on obtient en economie ferm6e quand l offre de travail est elastique et en economie ouverte quand l offre de travail est fixe on proc ede alors a la definition de la politique fiscale optimale

network infrastructure spillover in private productive sectors evidence from spanish high capacity roads interest in public infrastructure research has been a subject of increasing concern to economists and policy makers this article aims at analysing the locational impact of the high capacity roads hcr on the spanish private economic activity from 1970 through 1998 given that this is one of main infrastructure based development strategy undertaken in spain in this period in a stochastic frontier production function framework we allow for modelling of provincial heterogeneity through the existence of different efficiency levels in the territorial units results show hcr spillovers between geographically close provinces and between provinces displaying similar socio demographic characteristics and government size to the extent that the magnitude and sign of these impacts differ across sectors a reasonable explanation of the limited impact of hcr on aggregate private production could be made the presence of a negative spillover effect in the industrial and business service sector suggests that spanish

fickle consumers durable goods and business cycles abstract this paper develops a three sector dynamic general equilibrium model with the specific aim of evaluating the role of consumer durables in the generation and propagation of business cycles the model displays indeterminacy at commonly considered realistic parameter restrictions and basically constant returns to scale if calibrated at modest increasing returns to scale the sunspots driven model version produces a close match to moments of aggregate u s data journal of economic literatureclassification numbers e00 e32

the effects of public capital on the productivity of the italian regions this article investigates the role played by public capital in increasing the productivity levels in italy for construction of the regional series for the public capital stock over the period 1996 to 2003 the study benefits from the use of the rich dataset on public expenditure recently published by the italian ministry of economy we have estimated panel production functions with the inclusion of traditional factors and also intangible inputs like research and development r d expenditure human capital hk and social capital sk the results point out that public capital has a positive and significant effect on production moreover the effects of all production factors vary considerably between the two macro areas of the country namely centre north and mezzogiorno more specifically while private capital is more effective in the south labour exhibits an elasticity much higher in the centre north with respect to the mezzogiorno the disaggregation of the public capital stock into functional cat

stable near rational sunspot equilibria abstract we introduce a new class of solutions to nonlinear forward looking models called near rational sunspot equilibria nrse nrse are natural nonlinear extensions of the usual sunspot equilibria associated with the linearized version of the economy and are near rational in that agents use the optimal linear forecasting model when forming expectations generic results for existence and stability under learning are established nrse in indeterminate nonlinear models are found to be stable under learning provided that the corresponding linearized model s minimal state variable solution is e stable nrse are readily computable and our results make it possible to use the standard linear tools to search for stable nrse we illustrate our results using a canonical nonlinear new keynesian model

infrastructures and productivity in the spanish regions mas m maudos j perez f and uriel e 1996 infrastructures and productivity in the spanish regions reg studies 30 641 649 the aim of this paper is to analyse the role of public capital the types of infrastructures in which it is invested and their territorial distribution in the gains in productivity of the private sector in the spanish regions in the period 1964 91 using panel data techniques to control for unobserved state specific characteristics the results obtained show how the infrastructures most directly linked to the productive process present a significant and positive effect on productivity they also show the importance of the network effect of the infrastructures of a productive nature as well as a decrease in the elasticity associated with such infrastructures as development progresses mas m maudos j perez f et uriel e 1996 les infrastructures et la productivite aux regions espagnoles reg studies 30 641 649 cet article cherche a analyser le role du capital public les

voracity vs scale effect in a growing economy without secure property rights abstract this paper extends the standard model of growth with insecure property rights by introducing variable labor supply and increasing returns to scale it is assumed that capital stock is jointly owned by multiple interest groups and that each group participates in production activities by supplying its labor force in this setting there are two opposing factors that affect growth over consumption in the absence of secure property rights and the scale effect due to the presence of increasing returns the growth performance of the economy thus depends on which factor dominates

government spending local indeterminacy and tax structure this paper develops an endogenous growth model where sustained growth is due to the introduction of a public input consumers derive utility from consumption leisure and a public good the public input and the public good are the flow of government expenditures these expenditures are financed by means of income taxes with these assumptions it is shown that the dynamic equilibrium may exhibit local indeterminacy when the tax rate on the labour income is large the tax structure that maximizes growth and the optimal tax structure are characterized and compared

can consumption spillovers be a source of equilibrium indeterminacy in the framework of a one sector exogenous growth model we show that consumption externalities are not a source of equilibrium indeterminacy when the labor supply is inelastic whereas they are under endogenous labor supply in particular when the marginal rate of substitution between own consumption and the others consumption is constant along the equilibrium path the equilibrium may exhibit indeterminacy when the following two conditions are simultaneously satisfied i both consumption and production externalities are present and ii the elasticity of the labor demand is larger than the elasticity of the frisch labor supply in contrast when the marginal rate of substitution is not constant the equilibrium may exhibit indeterminacy even if the previous two conditions are not met in this case the equilibrium can exhibit indeterminacy even if production externalities are absent we also show that these results do not apply to an endogenous growth model where indeterminacy may arise only when condition ii is met

poverty traps indeterminacy and the wealth distribution we consider a one sector growth model in continuous time with a production externality and endogenous labor supply there is a continuum of households who have identical preferences but differ with respect to their initial wealth we show that there exist economies such that an indeterminate steady state exists for some wealth distribution but not for others a second result is that a redistribution of wealth may drive the economy from a steady state with strictly positive output to a poverty trap in which output converges asymptotically to zero these results indicate that differences in the wealth distribution may be responsible for drastic differences in the long run standard of living journal of economic literature classification numbers d31 d50 o41

capital labor substitution and equilibrium indeterminacy empirical evidence indicates that the elasticity of capital labor substitution for the aggregate u s economy is below unity in contrast the existing indeterminacy literature has mostly restricted attention to a cobb douglas production function which imposes a substitution elasticity exactly equal to unity this paper examines the quantitative relationship between capital labor substitution and the conditions needed for equilibrium indeterminacy and belief driven fluctuations in a one sector growth model with variable capital utilization the substitution elasticity has little quantitative impact on the minimum degree of increasing returns needed for indeterminacy however when capital utilization is constant a below unity substitution elasticity sharply raises the minimum degree of increasing returns in this version of the model lower substitution elasticities impose a higher adjustment cost on labor hours that cannot be mitigated by shifts in the capital utilization rate overall our results show that empirically plausible departures from the cobb douglas specification can make indeterminacy more difficult to achieve

indeterminacy under constant returns to scale in multisector economies recently there has been a renewed interest in indeterminacy or alternatively put in the existence of a continuum of equilibria in dynamic economies that exhibit some market imperfections one of the primary concerns of this literature has been the empirical plausibility of indeterminacy which arises in markets with external effects or with monopolistic competition often coupled with some degree 10 of increasing returns

the asset growth effect insights from international equity markets abstract firms with higher asset growth rates subsequently experience lower stock returns in international equity markets consistent with the u s evidence this negative effect of asset growth on returns is stronger in more developed capital markets and markets where stocks are more efficiently priced but is unrelated to country characteristics representing limits to arbitrage investor protection and accounting quality the evidence suggests that the cross sectional relation between asset growth and stock return is more likely due to an optimal investment effect than due to overinvestment market timing or other forms of mispricing

endogenous participation risk in speculative markets abstract this paper analyses the dynamic implications of an asset pricing model with incomplete participation due to entry costs it is shown that heterogeneity in entry costs can lead to the existence of multiple stochastic sunspot equilibria whereby the number of agents in the market and asset prices fluctuate endogeneously over time in the absence of fundamental uncertainty such asset price fluctuations occur despite the uniqueness of the deterministic equilibrium and thus bear no link to the usual notion of steady state indeterminacy in addition to excess volatility the equilibria exhibit predictable and conditionally heteroskedastic returns

the informativeness of earnings and management s issuance of earnings forecasts abstract theory suggests that managers issue earnings forecasts to reduce information asymmetry an earnings forecast is more effective in reducing information asymmetry if it contains earnings news that is relatively more informative about the firm s value we hypothesize that a manager is more likely to issue an earnings forecast if investors perceive that earnings are more informative we measure earnings informativeness by estimating the firm s earnings response coefficient erc in quarters prior to the forecast issuance decision consistent with our hypothesis we find that the firm s historic erc is positively associated with management s issuance of earnings forecasts

regional productivity variation and the impact of public capital stock an analysis with spatial interaction with reference to spain in this article we examine whether variations in the level of public capital across spain s provinces affected productivity levels over the period 1996 to 2005 the analysis is motivated by contemporary urban economics theory involving a production function for the competitive sector of the economy industry which includes the level of composite services derived from service firms under monopolistic competition the outcome is potentially increasing returns to scale resulting from pecuniary externalities deriving from internal increasing returns in the monopolistic competition sector we extend the production function by also making log labour efficiency a function of log total public capital stock and log human capital stock leading to a simple and empirically tractable reduced form linking productivity level to density of employment human capital and public capital stock the model is further extended to include technological externalities or spillovers across provinces using panel data

on the minimum degree of returns to scale in sunspot models of the business cycle abstract bennett and farmer j econ theory 93 2000 118 claim that the degree of increasing returns to scale required for indeterminacy in a single sector growth model can be lowered by allowing for preferences that are non separable in consumption and leisure in this paper i show that the example they give violates concavity in a more general setup which does not impose specific functional forms on utility i prove that there are no concave utility functions compatible with indeterminacy if the elasticity of scale is lower than the inverse of the labor share in production

expectational stability of sunspot equilibria in non convex economies we examine the stability under learning e stability of sunspot equilibria in non convex real business cycle models the production technology is cobbdouglas with externalities generated by factor inputs we establish that with a general utility function the well known benhabib farmer condition benhabib and farmer 1994 that the labor demand curve is upward sloping and steeper than the frisch labor supply curve is necessary for joint indeterminacy and e stability then with a separable utility function and allowing for negative externalities from capital inputs we discover large regions in parameter space corresponding to stable indeterminacy that is learnable sunspot equilibria these existence results overturn the conventional wisdom that sunspot equilibria in rbc type models are inherently unstable and provide concise closure to the stability puzzle of evans and mcgough 2005b

bringing the future forward the effect of disclosure on the returns earnings relation this paper studies how firm disclosure activity affects the relation between current annual stock returns contemporaneous annual earnings and future earnings our results show that firms with relatively more informative disclosures bring the future forward so that current returns reflect more future earnings news we also find that changes in disclosure activity are positively related to changes in the importance of future earnings news for current returns these results suggest that a firm s disclosure activity reveals credible relevant information not in current earnings and that this information is incorporated into the current stock price

nonseparable preferences fiscal policy puzzles and inferior goods nonseparable preferences over consumption and leisure can generate an increase in private consumption in response to government spending as found in the data in a frictionless business cycle model however the conditions on preferences required for these result to obtain hold if and only if the consumption good is inferior similarly positive co movement of consumption and hours worked occurs if and only if either consumption or leisure is inferior

indeterminacy and increasing returns abstract we investigate properties of the one sector growth model with increasing returns under two organizational structures capable of reconciling the existence of aggregate increasing returns with competitive behavior by firms the first involves input externalities the second involves monopolistic competition we show for parameters in close accord with recent literature on real business cycles that the model displays an indeterminate steady state that can be exploited to generate a model of business fluctuations driven by self fulfilling beliefs in our first class of models growth is generated by exogenous increases in factor productivity in the second class the marginal product of capital is large enough for endogenous growth journal of economic literature classification numbers e00 e3 o40

non optimality of the friedman rule and optimal taxation in a growing economy with imperfect competition abstract this paper shows that if capital generates production externality there exists a wedge between returns to money and to capital driving the friedman rule is not optimal however in the absence of capital externality the friedman rule may be valid even under imperfect competition

public infrastructure investment interstate spatial spillovers and manufacturing costs effects of public infrastructure investment on the costs and productivity of private enterprises have proven difficult to quantify empirically one piece of this puzzle that has received little attention is spatial spillovers we apply a cost function model to 1982 1996 state level u s manufacturing data to untangle the private cost saving effects of inter and intrastate public infrastructure investment we implement two spatial adaptations including a spatial spillover index in the theoretical model and allowing for spatial autocorrelation in the stochastic structure recognizing such spillovers both increases the estimated magnitude and significance of cost savings from intrastate public infrastructure and augments these productive effects

on the use of instrumental variables in accounting research abstract instrumental variable iv methods are commonly used in accounting research e g earnings management corporate governance executive compensation and disclosure research when the regressor variables are endogenous while iv estimation is the standard textbook solution to mitigating endogeneity problems the appropriateness of iv methods in typical accounting research settings is not obvious drawing on recent advances in statistics and econometrics we identify conditions under which iv methods are preferred to ols estimates and propose a series of tests for research studies employing iv methods we illustrate these ideas by examining the relation between corporate disclosure and the cost of capital

property rights protection corporate transparency and growth in countries with secure property rights corporate transparency improves investment efficiency and increases growth by alleviating information asymmetry however in countries with insecure property rights greater transparency can increase the risk of government expropriation therefore some firms that would benefit most from transparency cannot take full advantage of it as they set sub optimal transparency levels using data from 59 industries in 69 countries we find that in countries with weak property rights protection industries that would benefit the most from transparency exhibit worse investment efficiency and grow more slowly than industries that can efficiently operate at minimal levels of transparency

a sunspot paradox abstract this paper shows that the local stability properties of dynamic general equilibrium macroeconomic models may depend on the length of a period in the model economy this leads to the following paradoxical situation the economy may be driven by sunspots for some decision frequencies while sunspots can have no impact at other decision frequencies

the economic crisis from a neoclassical perspective abstract this paper assesses the 2007 2009 recession using neoclassical business cycle theory i find that the 2007 2009 u s recession differs substantially from other postwar u s recessions and also from the 2008 recession in other countries in that lower labor input accounts for virtually all of the decline in income and output in the united states while lower productivity accounts for much of other u s recessions and the 2007 2009 recession in other countries i also find that existing classes of models including financial market imperfections models do not explain the u s recession this is because the 2007 2009 recession is almost exclusively related to what appear to be labor market distortions that drive a wedge between the marginal product of labor and the marginal rate of substitution between consumption and leisure a topic about which current classes of financial imperfection models are largely silent i discuss future avenues for developing this class of models and i consider alterna

local determinacy with non separable utility this paper introduces general formulations for both technology with input substitution and non separable utility compatible with balanced growth and stationary worked hours into a benchmark rbc model it is shown that intertemporal substitution and input substitutability lead to local determinacy and rule out stationary sunspot equilibria when labor demand is downward sloping in contrast with recent results obtained under the assumption of separable utility the main intuition behind this result is shown to work as follows in contrast with separable preferences increasing the elasticity of intertemporal substitution in consumption necessarily implies decreasing the elasticity of constant consumption labor supply when utility is non separable and concave which affects unfavorably the occurrence of local indeterminacy

the effects of sfas 131 geographic segment disclosures by us multinational companies on the valuation of foreign earnings foreign operations are becoming increasingly important for us companies we investigate whether the market s valuation of foreign earnings is a function of the firm s geographic segment disclosures specifically we examine the effects of an increase in the number of geographic segments disclosed and the inclusion of earnings measures in geographic segment disclosures following the adoption of sfas 131 we find strong evidence that our proxies for increased disclosure are positively associated with the valuation of foreign earnings our results are robust to a number of sensitivity analyses taken together our results suggest that the pricing of foreign earnings is associated with important aspects of the firm s information environment

public sector capital and the productivity puzzle a number of studies have suggested a quantitatively important relationship between public sector capital accumulation and private sector productivity with the most compelling evidence derived from analyses of state level data estimates herein of production functions that use standard techniques to control for unobserved state specific characteristics however reveal essentially no role for public sector capital in affecting private sector productivity only estimates of state production functions that do not include such controls find substantial productivity impacts this result reconciles existing econometric estimates with the findings of hulten and schwab based on growth accounting techniques as such techniques effectively control for state specific effects region level estimates are essentially identical to those from state data suggesting no quantitatively important spillover effects across states copyright 1994 by mit press

economies of scale in banking indeterminacy and monetary policy this paper investigates economies of scale es in financial intermediation as a source of equilibrium indeterminacy consumption in the model can be purchased with currency and deposits and es in intermediation implies that deposit costs are decreasing in aggregate deposits the results suggest that indeterminacy does not depend on a large degree of es nor a large intermediation sector but on monetary policy and the determination of nominal interest rates monetary policies not targeting nominal rates allow for indeterminacy to arise for any degree of es while policies targeting nominal rates eliminates indeterminacy for all degrees of es

monetary policy and asset prices with belief driven fluctuations abstract we present a heterogeneous agents new keynesian model subject to a cost channel of monetary policy transmission constant turnover between long time traders and newcomers in market activities combined with restricted trading opportunities introduces a feedback from the stock market to real activity making stock prices non redundant for the business cycle we show that strict inflation targeting can lead to equilibrium indeterminacy even if the policy rule satisfies the taylor principle a belief driven shock to stock price generates relative volatilities of key financial variables which are very close to what is observed in u s data this result hints to the possibility that the financial instability witnessed since the mid to late 1990s was the result of waves of rational exuberance and pessimism in financial markets our analysis suggests that a mild response to stock prices in the central bank s policy rule can restore equilibrium determinacy and therefore rule out non fundamental volatility

is public expenditure productive abstract this paper considers the relationship between aggregate productivity and stock and flow government spending variables the empirical results indicate that i the nonmilitary public capital stock is dramatically more important in determining productivity than is either the flow of nonmilitary or military spending ii military capital bears little relation to productivity and iii a core infrastructure of streets highways airports mass transit sewers water systems etc has most explanatory power for productivity the paper also suggests an important role for the net public capital stock in the productivity slowdown of the last fifteen years

population growth and economic growth a reconsideration abstract in an endogenous growth model endogenous fertility a neo malthusian relation emerges only when all exogenous variables are controlled for this suggests that conflicting findings in the literature may originate from heterogeneity in unobserved variables in cross country panel data sets

can environmental taxation stimulate growth the role of indeterminacy in endogenous growth models with environmental externalities abstract this paper examines the effects of environmental taxation on long run growth in an infinitely lived representative agent model of endogenous growth with negative pollution externalities the novelty of this paper lies in its investigation of how the long run effects of environmental taxes are affected by the possible emergence of indeterminacy of equilibria in romer s 1986 increasing returns and long run growth journal of political economy 94 1002 1037 learning by doing model with endogenous labor supply the analysis shows that environmental taxation generally enhances harms long run growth when the balanced growth path is indeterminate determinate

aggregate instability under balanced budget consumption taxes a re examination we re examine the destabilizing role of balanced budget fiscal policy rules based on consumption taxation using a one sector model with infinitely lived households we consider a specification of preferences derived from jaimovich 2008 14 and jaimovich and rebelo 2009 15 which is flexible enough to encompass varying degrees of income effect when the income effect is not too large we show that there exists a laffer curve which explains the multiplicity of steady states and that non linear consumption taxation may destabilize the economy promoting expectation driven fluctuations if the elasticity of intertemporal substitution in consumption is sufficiently larger than one and the tax rate is counter cyclical with respect to consumption numerical illustrations also show that consumption taxation may be a source of instability for most oecd countries for a wide range of structural parameters configurations we finally prove the robustness of our conclusions if we consider a discrete time setup

unemployment and indeterminacy abstract using an efficiency wage model we examine the relationship between indeterminacy and unemployment insurance it is shown that the less unemployment insurance is the more likely equilibrium is to be indeterminate equilibrium can be indeterminate even without externalities or increasing returns which makes a sharp contrast to the recent literature on indeterminacy our result is based on the fact that the no shirking condition with marginal utility of wealth kept constant is downward sloping when income insurance is not perfect

public capital stock and economic growth an analysis of the spanish economy the objective of this paper is to evaluate the short and long term effects of public investment in infrastructure on aggregate output labour and capital formation in the private sector the problem is analysed in a dynamic multivariate framework which allows for explicit consideration of feedback among all the variables this approach generalizes the current literature which relies on a single equation model to estimate production functions and implicitly assumes the absence of feedback relationships for the spanish economy our results suggest positive long term effects of public investment on the private sector variables

technical efficiency of spanish manufacturing firms a panel data approach this paper estimates the levels of technical efficiency reached by spanish manufacturing firms through an econometric estimation of frontier production functions for fifteen sectors of activity and also obtains other relevant technological measurements of these productive processes such as the scale and the technical progress parameters the methodology used is the panel data methods schmidt and sickles 1984 the statistical source is provided by the survey on business strategies encuesta sobre estrategias empresariales a panel of data covering 855 spanish manufacturing firms observed over the period 1990 1994 our econometric results confirm the great heterogeneity in the firms efficiency the predominance of constant returns to scale and the great rate of technological progress

what determines aggregate returns to scale abstract this paper develops a unified framework that incorporates four features important in existing models with increasing returns fixed costs decreasing marginal costs product variety and market power when fixed costs are not allowed to vary and profits are imposed to be zero in every period only the degree of returns to variety determines the degree of aggregate increasing returns to scale when fixed costs respond to changes in aggregate activity or the zero profit condition does not hold in the short run aggregate returns depend not only on product variety but also on diminishing marginal costs or market power the degree of market power however does not affect input prices which are critical to determine the uniqueness of equilibrium

exploring the impact of internal corporate governance on the relation between disclosure quality and earnings management in the uk listed companies this study investigates the impact of internal corporate governance on the relation between disclosure quality and earnings management in the uk listed companies in particular whether governance mechanisms have deterrent effect on earnings management similar to firms disclosure quality unlike prior literature we measure a number of board and audit committee related governance instruments three disclosure quality proxies i e investor relation magazine award forward looking disclosure and analyst forecast accuracy and the modified jones model to test the hypotheses of the study on a matched pair sample data of investor relation magazine award winning and non winning firms our findings in the ols and sensitivity analyses using heckman procedure and 2sls regressions consistently report a significant negative association between earnings management and disclosure quality for all proxies in restraining earnings management in contrast corporate governance variables are mostly insignificantly related to earnings management this provides an emerging trend of the outperformance of disclosure quality over internal governance mechanisms in lessening earnings management these findings warrant due attention of the policy makers investors corporate firms and other stakeholders in shaping a high quality disclosure and governance regime in corporate settings to mitigate managerial manipulations of earnings across the countries in the world

earnings announcements and competing information abstract we investigate whether competing information primarily analyst reports reduces the usefulness of earnings announcements inconsistent with the view that information in analyst reports substitutes for earnings announcements we find a positive relation between absolute abnormal returns to the two types of disclosures this positive relation also characterizes subsequent period analyst reports relative to current period earnings announcements we also find that aggregate absolute reactions to both types of disclosures increased over 1986 1995 as a whole these results provide little support for the view that the informativeness of earnings announcements is eroded by competing information in the form of analyst reports

nominal income targeting versus money growth targeting in an endogenously growing economy abstract we find that local indeterminacy more easily emerges under a regime of nominal income targeting both targeting regimes are equally effective in influencing economic growth and inflation the results thus favor money growth over nominal income as a nominal anchor

urban diversity and economic growth at the risk of some simplification it is possible to identify four periods of intense study of cities by economists each of these has led to an increased understanding of the economics of urban areas and the unique role played by cities in the modem economy the first of these periods occurred in the decade after world war i only about ten years after the truck revolutionized the transport of goods within urban areas this period included the first systematic empirical analysis of the forces affecting the location of firms and households within cities robert murray haig 1926 and a number of other microeconomists at columbia analyzed the spatial pattems of manufacturing activity in lower manhattan and in the rest of new york city haig jmd his colleagues devoted considerable attention to where things belong in an urban area p 402 providing the first systematic economic analysis of urban spatial structure for example they analyzed the garment industry concluding that it was destined by nature to disperse north of 14th street and predicting that it would follow the estabhshed spatial pattem of the cooperage barrelmaking industry standardization in size and quality of barrels had meant that identical barrels could be made throughout the new york metropolitan area even in new jersey and the introduction of the truck meant that they could be transported cheaply throughout the region and exported the second of these periods though not in chronological order began in the mid 1960s it formalized many of the insights about location incentives within urban areas which had been uncovered a half century before mixed them with the logic of heinrich von thunen s 1826 ancient theories about agricultural crops and land values and applied them to the hotisehold sector the works of william alonso 1964

spillover effects of public capital formation evidence from the spanish regions maybe because of the inconclusive nature of the results on the impact of public capital on output at the regional level the issue of the po ssible existence of the regional spillovers from public capital formation has received little attention the objective of this paper is to provide evidence on the possible existence of such spillovers we consider the case of spain and its seventeen regions our methodological approach consists in estimating an aggregate var model for spain as well as seventeen region specific var models in which both capital installed in the region and capital installed outside the region are allowed to play a role in en hancing regional output the estimation results can be summarized as follows the aggregate effects of public capital formation in spain are important they cannot however be captured in their entirety by the direct effects in each region from public capital installed in the region itself when for each region both the capital installed in the region and the capital installed outside the region are considered the total disaggregated effect from the seventeen regional models are very much in line with the aggregate results furthermore the aggregate effect seems to be due in almost equal parts to the direct and spillover effects of public capital formation ultimately this paper establishes the relevance of both capital installed in each region and s pillover effects in the understanding of the regional decomposition of the aggregate effects of public capital formation in doing so it opens the door to some tantalizing and potentially highly charged research issues in terms of the determination of the optimal location of public investment projects

public infrastructure and regional economic development a simultaneous equations approach an analysis of how central bank exchange market intervention can affect both the level of exchange rates and the risk premium in asset returns showing how the risk premium is related to the conditional variances of intervention and other exogenous processes