measuring positive externalities from unobservable victim precaution an empirical analysis of lojack lojack is a hidden radio transmitter device used for retrieving stolen vehicles because there is no external indication that lojack has been installed it does not directly affect the likelihood that a protected car will be stolen there may however be positive externalities due to general deterrence we find that the availability of lojack is associated with a sharp fall in auto theft rates of other crime do not change appreciably at least historically the marginal social benefit of an additional unit of lojack has been fifteen times greater than the marginal social cost in high crime areas those who install lojack however obtain less than 10 percent of the total social benefits leading to underprovision by the market

the relative quality of foreign educated nurses in the united states we examine the relative quality of foreign educated nurses using wages as a measure of skill philippine educated nurses enjoy a wage premium that is not explained by observed differences in worker or job characteristics we reconcile the results with a roy model featuring endogenous skill acquisition and provide some empirical evidence of double selection into nursing and migration our results suggest that the wage premium is likely driven by strong positive selection into nursing among filipinos resulting from high and heterogeneous returns to the occupation due to active government support for nurse migration in the philippines

quantitative methods in credit management a survey many static and dynamic models have been used to assist decision making in the area of consumer and commercial credit the decisions of interest include whether to extend credit how much credit to extend when collections on delinquent accounts should be initiated and what action should be taken we survey the use of discriminant analysis decision trees and expert systems for static decisions and dynamic programming linear programming and markov chains for dynamic decision models since these models do not operate in a vacuum we discuss some important aspects of credit management in practice e g legal considerations sources of data and statistical validation of the methodology we provide our perspective on the state of the art in theory and in practice

driving to opportunity local rents wages commuting costs and sub metropolitan quality of life we examine variation in local rents wage levels commuting costs household characteristics and amenities within metropolitan areas for 2071 areas covering the united states by density and central city status we demonstrate the sensibility of estimating wage levels by workplace not residence and recover decentralized rent gradients that fall with commuting costs we construct and map a willingness to pay index which indicates the quality of life typical households receive from local amenities when households are similar mobile and informed this index varies considerably within metros and is typically high in areas that are dense suburban sunny mild safe entertaining and have elevated school funding

returns to nursing education 1970 84 using four large micro data sets this paper examines the returns to investments in education by registered nurses during the period 1970 84 wage models are estimated by a maximum likelihood technique that accounts for selection bias no wage difference existed between associate and diploma degree nurses modest hourly wage premiums were found for baccalaureate bs compared with associate degree nurses returns to positions of responsibility were substantial however when career patterns of promotion were examined in a multinomial logit model and although statistically significant differences existed in favor of the baccalaureate nurses the differences were small blacks made substantial gains over the period while males consistently earned large wage premiums

testing the adequacy of markov chain and mover stayer models as representations of credit behavior we summarize methodology for testing the compatibility of discrete time stochastic processes stationary and nonstationary markov chains and an extension the mover stayer model with longitudinal data from an unknown empirical process we apply this methodology to determine the suitability of these models to represent the payment behavior of a sample of retail revolving credit accounts we are led to reject stationary and also nonstationary markov chain models for our data and for our state space definition in favor of the mover stayer model the mover stayer model in contrast to markov chains incorporates a simple form of population heterogeneity stationary markov chains have been used extensively in finance literature to model payment behavior of credit accounts our empirical study suggests however that stationary markov chains may not appropriately model payment behavior it also indicates that incorporating heterogeneity in modeling payment behavior may be more important than incorporing nonstationarity

the impact of violence surges on neighbourhood business activity theoretical and empirical arguments suggest that fear of violence will cause consumers employees and entrepreneurs to alter their routine activities in areas that experience a surge in violent activity this paper argues that understanding how businesses respond to violence has important implications for understanding community crime cycles and offers further evidence of how crime impacts the choices individuals make with regard to where they live shop and work using newly available longitudinal business data and homicide data disaggregated to the zip code level an examination is made of the impact of violence surges on the creation destruction and growth of business establishments in five large us cities between 1987 and 1994 controlling for pre existing levels of violence it is found that increased violence has the greatest consequences for service related establishments in low crime neighbourhoods this finding is consistent with the notion that the fear of victimisation imposes additional indir

crime and social interactions the high variance of crime rates across time and space is one of the oldest puzzles in the social sciences this variance appears too high to be explained by changes in the exogenous costs and benefits of crime we present a model where social interactions create enough covariance across individuals to explain the high cross city variance of crime rates this model provides an index of social interactions which suggests that the amount of social interactions is highest in petty crimes moderate in more serious crimes and almost negligible in murder and rape

is there a compensating wage differential for high crime levels first evidence from europe abstract this paper investigates whether high regional crime levels lead to a compensating wage differential paid by firms in the respective region using data from german social security records official police statistics and official statistics for 2003 2006 i consider both violent and non violent crimes and use three way error components estimators to control for individual and regional heterogeneity the findings suggest that wages are practically unrelated to changes in crime rates this result is robust over a wide range of subgroups there is however some evidence that crime rates influence land prices

human capital and information this paper examines the issue of the establishment size wage effect it analyzes a cross section for the year 1979 with information on 607 individuals and the 60 private sector establishments where they work it discusses four theories of the establishment size wage effect and uses empirical proxies to test them it shows that when a dummy variable on computer access in the establishment is introduced as a regressor the establishment size variable is an insignificant regressor this result and other evidence supports the contention that the establishment size coefficient captures the effect of unobserved human capital accumulation

impact on firms of the use of knowledge external sources a systematic review of the literature this study summarizes the main conclusions from a systematic review of the empirical literature regarding the impact on firms of the use of knowledge external sources universities research institutes and knowledge intensive business services with the aim to organize the literature we classify the different works according to the research question addressed i which firms use knowledge external sources ii do firms using knowledge external sources achieve better results and iii which firms benefit the most from using knowledge external sources stylized facts are that larger more r d intensive and high tech firms are more likely to use knowledge external sources and that use of knowledge external sources is associated to firms higher technical results less attention has been paid to the third question and evidence is not conclusive several recommendations for future research emerge first to take in greater consideration methodological issues so that potential biases in the results caused by sample selection and endogeneity are handled properly second to pay more attention to heterogeneous outcomes third to use continuous indicators of depth and breadth of links allowing for non linear relationships and fourth to extend evidence for developing countries and service industries

effect of corporate scientists on firms innovation activity a literature review this study reviews the literature on the effect of corporate scientists on firms innovation activities traditionally the scientist s role in a firm is linked to the processes of generation and absorption of scientific knowledge however a growing number of studies over the years show that the scientist s role in firm innovation processes is more extensive and that they contribute to the development of successful new products processes and services however there are no comprehensive reviews of this literature this paper fills the gap by providing a systematic review of the empirical literature on the role of the corporate scientists in the innovation process by investigating 1 theoretical approaches used to evaluate the impact of scientists 2 the importance for the firm s innovation activity of scientists heterogeneity 3 those firm innovation activities over which scientists exhibit more influence 4 the variables moderating the effect of scientists and 5 research implications for managers

compensating differentials and unmeasured ability in the labor market for nurses why do hospitals pay more nurses employed in hospitals realize a large wage advantage relative to nurses employed elsewhere this paper examines alternative sources of the hospital premium a topic of some interest given the current shifting of medical care out of hospitals whereas cross sectional estimates indicate a hospital rn wage advantage of roughly 20 percent longitudinal analysis suggests that a third to a half of the advantage is due to unmeasured worker ability the remainder is likely to reflect compensating differentials for hospital disamenities we further probe possible sources of the rn hospital premium by examining the receipt of fringe benefits differences in cognitive ability as measured by afqt test scores differences in the quality of experience the role of labor unions and rents earnings on second jobs and the magnitude of wage differentials associated with work shift

estimation and testing of the union wage effect using panel data we present estimates of the union wage effect controlling for unmeasured individual effects and subject the conventional fixed effects model to specification tests for psid men the union wage effect is 5 8 after controlling for person effects as opposed to 20 in cross section omnibus tests based on an unrestricted reduced form and instrumental variables tests based on differencing are consistent with conventional models tests based on comparing those who enter and leave union coverage provide evidence against the usual model we find evidence for interactions between union status and other variables even after controlling for person effects

when national innovation system meet varieties of capitalism arguments on labour qualifications on the skill types and scientific knowledge needed for radical and incremental product innovations the literatures on varieties of capitalism voc and national innovation systems nis propose very similar arguments about how firms require different types of labour qualifications to pursue strategies of radical product innovation rpi incremental product innovation ipi and product imitation pi respectively despite their similar lines of reasoning however the voc scholars are concerned with the skill profiles of a firm s entire workforce whereas the nis proponents focus on the knowledge base of scientists given that both literatures have developed without explicitly taking the arguments of the neighbouring discipline into account it is thus unclear whether they explain the same or different phenomena furthermore both literatures propose firm level arguments but test them on the basis of macro rather than micro level indicators this paper therefore asks first does micro level evidence support the voc and nis arguments that particular types of employee skills and knowledge backgrounds of scientists are needed for different competitive strategies and if so do rpi ipi and pi firms need to employ scientists in combination with a workforce having the respective qualifications or is it sufficient if scientists or employees alone are adequately qualified quantitative analyses indicate that a particular mix of scientific knowledge combined with employee skills facilitate rpi ipi and pi strategies the article thus concludes that despite their similar reasoning the voc and the nis literatures indeed describe different phenomena without being aware of the synergies created whenever adequate employee and scientific qualifications are hired together

the impact of terrorism on italian employment and business activity despite the growth in research examining direct economic impacts of terrorism the indirect impact of terrorism on the stability of local economies has generally been overlooked using panel data regression models and the most comprehensive open source database on terrorism currently available to researchers the paper examines the impact of terrorism on employment and business outcomes in italy from 1985 to 1997 it is found that terrorist attacks reduce the number of firms and employment in the year following an attack by disaggregating net outcomes into their component gross flows it is also found that these impacts are primarily attributable to reduced business formations and expansions

compensating differentials for shift work a model analyzing the choice of shift is developed and estimated using data from two supplements to the current population survey the findings show a positive wage premium for shift work that varies with personal characteristics and there is strong evidence showing the importance of self selection as workers with low potential daytime earnings are more likely to choose night work and supplement their earnings the findings demonstrate that cross section estimates of wage premiums for union membership and firm size are biased upward because they pick up some of the compensating differential for shift work

monopsony power and relative wages in the labor market for nurses this paper examines the thesis that monopsony power is an important determinant of wages in nursing labor markets using data from the 1985 93 current population surveys measures of relative nurse non nurse wage rates for 252 labor markets are constructed contrary to predictions from the monopsony model no positive relationship exists between relative nursing wages and hospital density or market size nor is support found for the presence of monopsony power based on evidence on union wage premiums slopes of experience profiles or the mix of rn to total hospital employment

the welfare cost of violence across countries the cost of violence goes beyond its material dimension including also the welfare loss due to higher mortality a given mortality and its distribution across age groups determines a reduction in life expectancy that can be valued using the marginal willingness to pay approach we estimate the health dimension of the welfare cost of violence for 73 countries on average 1 year of life expectancy lost to violence is associated with a yearly social cost of 3 8 of gdp the health dimension increases the estimated social costs of violence by 40 in the united states and by 57 in latin america

does unmeasured ability explain inter industry wage differentials this paper provides empirical assessments of the two leading explanations of measured inter industry wage differentials 1 true wage differentials exist across industries and 2 the measured differentials simply reflect unmeasured differences in workers productive abilities first we summarize the existing evidence on the unmeasured ability explanation second we construct a simple model which shows that if matching is important then endogenous job change decisions can create important self selection biases even in first differenced estimates of industry wage differentials third we analyze a sample that approximates the experiment of exogenous job loss we find that i the wage change experienced by a typical industry switcher closely resembles the difference in the relevant industry differentials estimated in a cross section and ii pre displacement industry affiliation plays an important role in post displacement wage determination

myopic deterrence policies and the instability of equilibria we develop a general equilibrium model of crime in which honest workers face an effective tax rate on earnings consisting of an exogenous income tax used to pay for policing and an endogenous crime tax given by the proportion of their disposable income that is stolen when there are two stable equilibria the low crime equilibrium is welfare dominant and furthermore welfare is a decreasing function of the income tax rate however as the income tax rate is reduced the degree of stability of the low crime equilibrium diminishes until for sufficiently low tax rates the low crime equilibrium is unstable with respect to any small positive perturbation in the crime rate thus myopic maximization of social welfare exposes the economy to random shocks in the crime rate that can destroy the preferred low crime equilibrium we argue that this dilemma between economizing on resources used for deterrence and ensuring the stability of the most desirable equilibrium is a fundamental trade off in the design of many institutions intended to control antisocial behavior including rent seeking corruption and theft

the link between crime risk and property prices in england and wales evidence from street level data this paper uses street level data on property sales and crime rates for england and wales to investigate compensating differentials for crime risk my identification strategy relies on the use of non parametric regional time trends on various levels of spatial aggregation as well as various fixed effects for streets and wider areas to control for unobserved amenities and regional economic conditions the data comes from transaction data collected by the land registry and recently published crime maps for the whole of the uk my estimates which are robust to a range of sensible specification changes suggest that each case of anti social behaviour per ten population in the same street leads to an approximately 0 6 0 8 drop in property prices while a corresponding increase in violent crime decreases prices by roughly 0 6 1 6 and a corresponding increase in non violent crime by about 0 2 0 4 the majority of estimates are at the upper end of these intervals estimates for robbery burglary and vehicle c

the union impact on hospital wages and fringe benefits this paper uses 1977 data from a national probability sample of 1 200 hospitals to estimate the effect of unions on wages and fringe benefits in four occupations registered nurses practical nurses secretaries and housekeepers the results show that unionization has a significant impact on wages that increases with the length of time collective bargaining has been in effect at the individual hospital the overall wage effect of unions is about 8 percent for both types of nurses and 11 to 12 percent for secretaries and housekeepers employed in hospitals the authors also estimate an equation for hospital wide fringe benefits which shows that such benefits are positively related to the percent of full time employees in the four occupations covered by union contracts

note on the cyert davidson thompson doubtful accounts model the results of the classical cyert davidson and thompson cdt model for estimating the allowance for doubtful accounts could be made more valuable by correcting one flaw the cdt model rests on the total balance method of aging dollars and as presented its answers cannot wisely be applied to estimate real dollar amounts notably the steady state distributions derived by the model tend to underestimate actually paid dollar amounts

dynamic capabilities and new product development in high technology ventures an empirical analysis of new biotechnology firms abstract in industries populated by entrepreneurial high technology firms the rapid development of new products is viewed as a key determinant of success developing a portfolio of new products is necessary to gain early cash flows external visibility and legitimacy early market share and increase the likelihood of survival schoonhoven eisenhardt and lymman 1990 in addition recent research has shown that new product development improves a firm s ability to raise money through an initial public offering deeds decarolis and coombs 1997 this paper develops a model of new product development which is tested on a sample of 94 pharmaceutical biotechnology companies we hypothesize that new product development capabilities are a function of a firm s scientific technological and managerial skills to test this relationship we develop several firm specific measures in an attempt to triangulate in on the core construct of firm specific new product development capabilities some important implications for entrepreneurs managers of high technology firms flow from our results first entrepreneur managers need to view the choice of geographic location as an important strategic decision which will impact their firm s access to the skilled technical personnel and the streams of knowledge our results indicate that a choice location has a significant concentration of similar firms but the level has not yet reached a point where competition for resources in the local environment offsets any advantages of the location in the case of biotechnology this would seem to indicate that the prime locations would be expanding areas such as san diego seattle and philadelphia rather then the established locations of silicon valley and boston second as scientific knowledge plays an ever more important role in a firm s success the quality of the firm s scientific team is a critical ingredient in a firm s new product development capability but how do you evaluate the quality of scientific personnel our results indicate that there is a strong positive relationship between the impact as measured by citations of a team s prior research in the academic community and the productivity of that team in a commercial research laboratory therefore the judgement of a scientific field captured by citations or perhaps expert judgement should prove to be a useful tool when evaluating personnel for a firm s research team third the results from our measures of ceo experience and the percentage of the top management team with a ph d are interesting as expected the prior experience of ceo in managing a commercial research facility enhances a firm s new product development capabilities however results for our top management team variable appears to indicate that the over reliance on technical personnel in the management of the organization detracts from the product development process taken together these results seem to imply that it is important that the leadership of the organization have knowledge of and experience in managing the new product development process but that diverting the firm s scientific personnel s energies away from the laboratory and into the management of the organization maybe counter productive therefore what a high technology venture appears to need is leadership that understands and has experience in the new product development process but which is separate and distinct from the scientific team this type of leadership keeps the scientific team focused on research and development and out of the boardroom

crime and the timing of work abstract two striking facts describe work timing in the united states a lower propensity to work evenings and nights in large metropolitan areas and a secular decline in such work since 1973 one explanation is higher and possibly increasing crime in large areas i link current population survey data on work timing to fbi crime reports neither fact is explained by changes in nor inter area differences in crime rates but higher homicide rates do reduce such work this reduction implicitly costs the economy between 4 and 10 billion this negative externality illustrates a larger class of previously unmeasured costs of social pathologies

unions and hospitals some unresolved issues abstract this article investigates the impact of unions on the wages of hospital workers our ols findings agree with previous ols studies unions increase registered nurses rns wages by five percent and by about eight to ten percent for other hospital workers by contrast we find after correcting for selectivity bias in hospital unionization status a direct union effect of about twenty percent on rn wages and in excess of thirty percent on wages of other hospital workers while the results based on selectivity bias adjustments make us uneasy we do not reject them out of hand we also find indirect union effects up to five percent by other unionized occupations within a hospital and up to ten percent by other unionized hospitals in the local labor market prospective reimbursement programs have a negative impact on the wages of hospital workers but are only significant for non unionized occupations our three empirical tests of monopsony all reject the view that monopsony is a factor in hospital wage setting even considering the large union effects based on selectivity bias adjustment we conclude that unions have been a minor contributor to hospital cost inflation