efficient search on the job and the business cycle the paper develops a model of directed search on the job in which transitions of workers between unemployment and employment and across employers are driven by heterogeneity in the quality of firm worker matches the equilibrium is such that the agents value and policy functions are independent of the endogenous distribution of workers across employment states hence the model can be solved outside of the steady state and used to measure the effect of cyclical productivity shocks on the labor market productivity shocks are found to generate large fluctuations in workers transitions unemployment and vacancies when matches are experience goods but not when matches are inspection goods

the international monetary fund and developing countries a review of the evidence and policy options as its systemic role evaporated with the collapse of the bretton woods system so the international monetary fund imf became drawn into a much more specific role in the context of the balance of payments bop problems that developing countries were encountering at its inception the imf had been seen as having no specific role in developing countries but now it became exclusively these countries that formed its clientele while during the 1970s the imf had continued to make a few relatively large loans to a limited number of industrial countries italy and the united kingdom beyond the mid 1970s industrial countries ceased to draw any resources from it

explaining international differences in male skill wage differentials by differences in demand and supply of skill this paper explores the hypothesis that wage differentials between skill groups across countries are consistent with a demand and supply framework using micro data from 15 countries we find that about one third of the variation in relative wages between skill groups across countries is explained by differences in net supply of skill groups the demand and supply framework does an even better job at explaining relative wages of low skilled workers

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

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

decriminalization and marijuana smoking prevalence evidence from australia this article uses the 2001 national drug strategy household survey to assess the impact of marijuana decriminalization policy on marijuana smoking prevalence in australia both parametric and nonparametric methods are used the parametric approach includes endogenous probit switching two part sample selection and standard dummy variable models while the nonparametric approach uses propensity score stratification matching specification analyses are also conducted a nonparametric kernel based test is constructed to select between parametric and nonparametric models and the likelihood ratio test is used to choose among parametric models our analyses favor the endogenous switching model where decriminalization increases the probability of smoking by 16 2

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

borrowing from the imf the policy implications of recent empirical research abstract at a time when the future of the international monetary fund is being widely debated a number of relevant and important studies have been published which advance our knowledge of the factors which determine borrowing from the fund there has been little attempt however to put this recent empirical research into context or to extract from it appropriate policy conclusions while dissent remains over some issues there is an emerging consensus on others which provides a firm empirical foundation for policy formulation unfortunately the policy stance adopted by the g7 is in many ways at odds with much of the recent empirical research

two to tango gender differences in the decisions to publish and coauthor i introduction there is a well developed mythology regarding the presence of old boy networks and their importance in explaining gender differences in labor market outcomes as articulated by saloner 1985 nonetheless aside from works such as simon and warner 1992 there is relatively little empirical evidence examining the impact of networks on market outcomes how these effects differ by gender and whether gender differences in network access change over time as women become more well represented in a profession the paucity of empirical evidence arises in part from the difficulty of measuring the presence of such networks prior work including that of saint paul 2001 and erickson and jacoby 2003 has found evidence that networks facilitate the adoption of team oriented work practices and information sharing that increase average worker productivity in management and professional jobs on the other hand studies such as that by marmaros and sacerdote 2002 have also found that women have less access to networks than their male counterparts in both private and public sector jobs which has been shown to yield gender differences in job placement and other labor market outcomes this article considers how gender differences in networks are manifested in a specific male dominated profession i e academic economists and in a specific work related outcome i e the decision to coauthor articles in which access to networks is likely to be important the analysis uses uniquely detailed individual and job level data for phd economists included in nearly four decades of american economic association aea membership to examine the role of networks on the joint decision to publish and coauthor the unique matching process of phd economists between academic and nonacademic jobs and within the hierarchy of academic departments along with the relative ease of observing joint research provide a rare opportunity to distinguish differential network access and measure joint production the results demonstrate the importance of networks in the production of research output and that new female entrants into a male dominated profession do not have equal access to these professional networks the results also provide evidence that women are able to plug into networks over time as the profession becomes more gender representative our study contributes to the literature on the role of networks in the labor market in several ways first the profession of academic economist is well suited to this study because it is made up of workers who produce a relatively homogenous output i e scholarly journal articles and that share a common set of job related tasks i e teaching research and service second the incidence of coauthorship is an observable outcome measure of network utilization a phenomenon inherently difficult to measure in the tradition of the business productivity literature as found in sabel 1993 third there is extensive evidence in the literature that journal publications are positively linked to academic salaries as found in siegfried and white 1973 and sauer 1988 that the propensity to coauthor is positively associated with publication output as in as found in durden and perri 1995 and maske et al 2003 that there are gender differences in tendencies to coauthor as shown by ferber and teiman 1980 and mcdowell and smith 1992 and that there are gender differences in professional outcomes such as publications salary and promotion as seen in mcdowell 1982 hansen et al 1978 formby et al 1993 and broder 1993 cumulatively these studies suggest that understanding the determinants of coauthorship is important for evaluating the sources and the extent of gender inequity in the profession prior work on coauthorship behavior has analyzed patterns over time and across disciplines several studies including hudson 1996 mcdowell and melvin 1983 and barnett et al

investments holdup and the form of market contracts the authors analyze incomplete contracts to induce efficient investment with exogenous switching costs fixed price contracts are efficient generate some rigidity in prices are renegotiated intermittently by possibly small amounts and when inflation is positive generate asymmetric responses to shocks all consistent with evidence on prices and wages with two sided specific investments efficiency requires prices to have sufficient escalator clauses to avoid renegotiation as observed in many long term contracts a third case with one sided specific investments can generate take or pay contracts and explain why firms sometimes pay for specific investments that appear to benefit employees directly

the imf a bird s eye view of its role and operations the international monetary fund imf is the world s premier international financial institution with 184 member countries and active programmes in a significant number of them at any one time the fund attracts a great deal of attention much of it critical but the discussion is often polemic in style strongly held but frequently opposing views are expressed this survey attempts to examine in an objective way the theory and evidence relating to the fund s operations many aspects of the empirical research are relatively recent and a universal consensus is yet to emerge as a consequence there is scope for disagreement to persist however the research is also gradually clarifying many important issues the format for the survey is to examine the life cycle of imf arrangements what makes a country turn to the fund for assistance should the imf be lending what influences the outcome of negotiations and the design of programmes are imf programmes effective and why do some countries make prolonged use of imf resources for completeness there is also some discussion of the history of the imf the extent to which fund policies have been influenced by advances in economic theory and the fund s systemic role important organisational and governance issues are also covered briefly although primarily adopting an economist s perspective the survey reflects the growing recognition that in order to understand the imf s operations economics has to be combined with politics examining the imf is an exercise in applied political economy copyright 2007 the author journal compilation 2007 blackwell publishing ltd

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

non contractible investments and vertical integration in the mexican footwear industry abstract this paper examines patterns of integration among manufacturers and retailers using data from a survey of footwear manufacturers in mexico the property rights framework developed in papers by grossman and hart 1986 j polit econ 94 691 and hart and moore 1990 j polit econ 98 1119 is differentiated from the standard empirical transactions cost framework in the context of this industry the most relevant distinction between the two frameworks is that the property rights framework addresses both the benefits and costs of integration while the transactions cost framework focuses only on variation in the benefits of integration we show that the costs of integration are highest where the retailer s non contractible investment has an important effect on the overall profits from the relationship consistent with the property rights framework the data suggest that integration is less likely in these circumstances

does being an imf executive board member re pay an examination of imf loans and repayments this paper analyses the political economy of imf loans and repayments using data from 99 countries over the period 1984 2014 we bring two contributions to the literature analysing i the impact of the presence of a country on the imf executive board and ii repayment behaviour and not only loan requests we show evidence that loans from and repayments to the imf are influenced by the presence of countries on the imf executive board in particular the results indicate that a position on the board increases the loan amount by approximately 0 5 points and the repayment amount by approximately 0 2 points

low pay dynamics and transition probabilities this paper models low pay transitions in britain using a bivariate probit model with endogenous selection to address the initial conditions problem and parental variables as instruments the exogeneity of the initial state is strongly rejected and results in considerable overstatement of the effects of explanatory factors the probability of being low paid depends strongly on low pay in the previous year restricting attention to those who remain employees results in an overstatement of the probability of the low paid moving up the earnings distribution but is not found to have much effect on the estimated effects of explanatory variables

participation in marijuana cocaine and heroin consumption in australia a multivariate probit approach this article investigates factors affecting the participation in marijuana cocaine and heroin using micro unit data from an australian national survey on recreational drugs accounting for cross drug correlation potentially induced by unobserved personal characteristics such as individual tastes and addictive personalities we estimate a trivariate probit model where the participation decisions are jointly modelled as a system with correlated error terms the estimated correlation coefficients are significant across all three drugs the study provides valuable empirical information on conditional and joint probabilities of drug participation the multivariate approach is shown to provide better analysis relative to a univariate approach that does not address the endogeneity of all drug participation variables

effectiveness of imf supported stabilization programs in developing countries abstract this paper examines the effectiveness of fund supported stabilization programs by investigating whether the imf achieves its own objectives in such programs even though the fund s conditionality prescribes fiscal and monetary discipline in program countries the results of the empirical analysis show that the imf cannot impose its conditionality even during program years furthermore when successive interprogram periods are considered program countries enter a new program in a worse macroeconomic condition than they entered the previous program these results and the fact that stabilization programs have a revolving nature are inconsistent with the effectiveness of imf supported stabilization programs and may signal the existence of moral hazard

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

consumer choice and competition policy a study of uk energy markets consumer choice is increasingly recognised as a crucial factor in competition policy to illustrate the implications of such choice we present an investment model of the switching choice in the uk residential natural gas market and examine responses to a specially commissioned survey of nearly seven hundred consumers identifying search and switching costs through an assessment of the savings which consumers say they require to switch supplier together with an evaluation of consumer switching behaviour we deduce that the incumbent retained considerable market power suggesting that some continued regulation may be necessary

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

the imf and precautionary lending an empirical evaluation of the selectivity and effectiveness of the flexible credit line abstract this paper provides an empirical evaluation of the flexible credit line fcl the imf s prime precautionary lending instrument since 2009 to which so far only mexico colombia and poland have subscribed we consider both questions of selectivity and effectiveness first which variables explain the three countries participation in fcl arrangements and second to which extent has the fcl delivered on its promise of boosting market confidence in its respective users based on a probit analysis we show that fcl selectivity can be explained by both demand and supply side factors the probability of participation in the fcl was greater in countries that experienced larger prior exchange market pressures that had lower bond spreads and inflation that accounted for higher shares in us exports and that exhibited a higher propensity of making political concessions to the us using a synthetic control approach we find evidence for some but generally limited beneficial effects on sovereign bond spreads and gross capital inflows into the three fcl countries overall our results suggest that any economic stigma that may prevent eligible countries from entering into an fcl arrangement is unwarranted conversely the apparent link of fcl participation with us interests is not conducive to overcoming political stigma

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

an analysis of offer functions of banks and credit unions in guatemala economists have sought to identify institutions which might fill the gap in household access to credit arising from rationing by formal lenders credit unions have been identified as institutions which might use informational and monitoring advantages to fill that gap using information on household perceptions of their access to credit this article analyses the impact of certain credit unions on the access to credit of households in guatemala regression results indicate that credit unions serve markets unserved by formal lenders and that information on household perceptions of their access to credit is important in making inferences about lender lending activities

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

on the dynamics of unemployment and wage distributions postel vinay and robin s 2002 sequential auction model is extended to allow for aggregate productivity shocks workers exhibit permanent differences in ability while firms are identical negative aggregate productivity shocks induce job destruction by driving the surplus of matches with low ability workers to negative values endogenous job destruction coupled with worker heterogeneity thus provides a mechanism for amplifying productivity shocks that offers an original solution to the unemployment volatility puzzle shimer 2005 moreover positive or negative shocks may lead employers and employees to renegotiate low wages up and high wages down when agents individual surpluses become negative the model delivers rich business cycle dynamics of wage distributions and explains why both low wages and high wages are more procyclical than wages in the middle of the distribution

food insecurity gender and international migration in low and middle income countries abstract the determinants of migration have been widely studied but research has rarely addressed the roles of food insecurity and gender in the migration decision process to address these gaps we examine these relationships for 135 078 individuals across 94 low and middle income countries we use a series of binary choice models with sample selection and data from the 2014 2015 waves of the gallup world poll survey which includes the first global measure of individual level food insecurity results which are robust indicate that food insecurity is an important determinant of both migration intentions and preparations and the probability of migration intentions increase monotonically with the severity of food insecurity and the probability of migration preparations decrease these relationships also differ significantly by gender and level of gross national income evidence suggests a need for increased coordination between the international food security and migration policy agendas

human capital pricing equations with an application to estimating the effect of schooling quality on earnings this paper formulates and estimates alternative models for the pricing of labor services we present economic models that rationalize empirical specifications in the literature and we offer evidence on the validity of those specifications widely used efficiency units models of labor services are inconsistent with evidence from the u s labor market a model of heterogeneous skills provides a more accurate description of earnings data we present evidence that the pursuit of comparative advantage and selective migration are important features of the u s labor market when these features are included in the model the only support for an effect of schooling quality on earnings is through the return to college education three interactions are empirically important in explaining log wage equations a between schooling quality and education b between regional labor market shocks and education and c between region of residence and regionof birth because of this third interaction which can arise from comparative advantage in the labor market no unique quality effect on returns to education can be defined independently of the market in which it is used

on the monetary macro dynamics of colombia and mexico abstract this paper investigates the dynamic interrelationship among money growth inflation and output growth for colombia and mexico on the basis of implementation of a vector autoregression methodology the evidence for colombia generally shows autonomous output growth and money growth behavior and an important role for money shocks in accounting for variations in inflations a different pattern of results emerged for mexico there are strong two way feedbacks among money growth and inflation and a less autonomous output growth behavior than in colombia

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

the short run relation between growth and inflation in latin america reply sebastian edwards uses a new unexpected money variable based on the addition of the contemporaneous fiscal deficit to my autoregressive money growth equations to argue that 1 in brazil and chile there is no significant relationship between unexpected money growth and output growth 2 unexpected money growth has different estimated effects on output in colombia peru and mexico and these effects substantially exceed those estimated in brazil and chile and 3 thus my 10 percent rule for the effect of unexpected money growth on output growth does not hold in addition edwards incorporates the terms of trade in his output equations and finds they are important in the case of chile and mexico finally edwards takes issue with my use of lagged inflation to explain output edwards and i use somewhat different data not only in terms of sources but also edwards often uses m2 rather than ml in reporting his best results however edwards and my basic results are broadly similar compare his table 1 and my original tables 1 and 4 this is encouraging and in general makes it seem not worth quibbling over the differences in data however there is one difference which affects the results that i will discuss later the inclusion of the fiscal deficit in the money growth equation is a key difference in our work as i pointed out in my earlier article fiscal and monetary policy often are closely related in latin america thus it is not surprising that edwards finds the deficit divided by lagged money is a significant factor in explaining money growth however the point is not to explain money growth but to estimate a relationship which the public could have been using to predict how much money and thus nominal aggregate demand has grown since the last observation on the money stock 2 it strains credulity to assume that in latin america the budget deficit could be used by the public to estimate money growth contemporaneously data on the cash deficit usually are available publicly only with a long lag moreover many alternative versions of a deficit involving creative accounting methods are reported for example for many years in colombia the reported deficit which is available with about a one quarter lag treated both the unspent portion of the budget and the accounting profits from the revaluation of the local currency value of exchange reserves as income procedures which caused great confusion inside as well as outside the government despite such problems the cash deficit still might be useful as a monetary growth predictor for example it may be correlated with some other easily available contemporaneous indicator of money growth however its usefulness can best be judged from a comparison of the results when the deficit is used only as the money growth predictor to determine unexpected money a constrained equation with those obtained when it is used as an additional independent variable an unconstrained equation a test robert barro has suggested in another context world bank the views and interpretations expressed in this article are my own and should not be attributed to the world bank its affiliated organizations or to any individual acting in their behalf edwards also uses the seemingly unrelated regression technique to take into account possible interrelationships in the error terms across countries judging from the reported t statistics this procedure did not improve the fits greatly 2surprisingly the deficit is not significant in explaining domestic credit in mexico this result and the estimated negative relationship between edwards domestic credit series and output suggest a problem in the domestic credit variable

the effects of imf and world bank lending on long run economic growth an empirical analysis summary the international monetary fund and the world bank frequently and often repeatedly extend loans to developing nations these loans have been blamed for generating adverse economic outcomes the growth impact of fund and bank loan programs is assessed using an empirical growth model that controls for other determinants of growth a unique feature of this study is the use of the value of loans rather than the number of programs the estimates indicate that bank lending stimulates growth in some cases primarily by increasing public investment fund lending is either neutral or detrimental to growth the channel for this effect is a negative impact of fund lending on public as well as private investment

macroeconomic effects of imf sponsored programs in latin america output costs program recidivism and the vicious cycle of failed stabilizations we investigate the effects of imf stabilization programs and the reasons behind the unusually high imf activity and relatively low program completion rates in latin america we base our tests on a panel and distinguish between imf program approvals and completion we find that latin america has higher output costs of imf programs especially when completed no improvement in the current account and a much higher likelihood of program failure and recidivism than other regions the common finding that entering into an imf supported program incurs real short run costs on the economy is entirely driven by the experiences in latin america

the economic and political determinants of imf and world bank lending in the middle east and north africa mena assumes both political and economic significance politically it is arguably the epicentre of world crisis chronically war prone and the site of the world s most protracted conflicts hinnebusch 2003 p 1 economically it owns the bulk of the world s oil reserves driving in particular the usa economic engine in light of the region s geopolitically and economically strategic position in the world economy it is clear that economic and political factors are inextricably linked when it comes to the manner in which the west particularly the usa responds to the region s needs

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

imf concern for reputation and conditional lending failure theory and empirics one possible explanation for the unsatisfactory implementation of imf conditionality has been attributed to the lack of credibility of the imf threat of interrupting financial assistance in case of non compliance with the negotiated conditions in this paper we suggest that such lack of credibility might be due to the dual role played by the imf which acts at the same time as a creditor and a monitor of economic reforms we show that the imf incentive to hide its surveillance failures in order to preserve its reputation of being a good monitor may actually distort its lending decisions towards greater laxity relative to social optimum in punishing non compliance with economic reforms we have empirically tested such theoretical result by supposing that larger departures from efficiency of the imf lending rule are associated with a longer relationship between a country and the imf the longer this relationship the stronger the imf reputation will be affected in case it ultimately decides to stop lending specifically we have empirically investigated whether imf disbursements are affected by the imf own share of debt which is taken as a proxy for the duration of the relationship between the fund and a country our empirical results show that a higher imf debt share does increase imf disbursements

the public pay gap in britain small differences that don t matter the existing literature on inequality between private and public sectors focuses on cross section differences in earnings levels forward looking agents however care about income and job mobility too which we show are substantially different between the two sectors using data from the bhps we estimate a model of income and employment dynamics allowing for unobserved heterogeneity in the propensity to be employed in eitherjob sector we detect a positive average public premium both in income flows and in the present discounted sum of future income flows we also find that income inequality is lower but more persistent in the public sector there is an ongoing debate as to whether public sector workers experience better or worse pay conditions than their private counterparts a recurring message in the recent literature is that although raw differences can be large most are likely to reflect differences in the composition of the workforce both in terms of observed characteristics such as age and education and in terms of unobserved characteristics nevertheless a look at labour markets in the two sectors suggests that individuals do perceive some differences between the sectors katz and krueger 1991 document the fact that blue collar workers are willing to queue to obtain public sector jobs whereas highlyskilled workers are notoriously hard to recruit and retain in the public sector the focus of most of the literature on public pay gaps is on cross section differences in earnings levels 2 yet the public private differences are arguably equally marked in terms of income mobility income volatility and job loss risk than in terms of mean income levels public sector employers are widely perceived to offer more job security 3 there is also plentiful evidence of relative wage compression in the public sector moreover as we shall point out public sector incomes are substantially more persistent over time than private sector incomes the motivating point of this article is that forward looking agents are likely to care about income and job mobility as well as income levels so that a more general assessment of the existence and magnitude of a public premium should be based on

many happy returns recidivism and the imf abstract imf programs are designed to provide a temporary source of finance for countries with balance of payments disequilibria consequently borrowing from the imf should occur infrequently and be widely distributed among member countries however some countries are recurrent users of fund resources this paper investigates which variables account for multiple borrowings from the imf we use models of count data to examine the impact of the need for financing domestic policies external shocks and structural and institutional factors on borrowings between 1980 and 1996 we find that recidivist borrowers have lower reserve holdings larger current account deficits and capital outflows lower but less volatile terms of trade larger debt service and external debt ratios lower investment rates and per capita income and weak governance

dynamic modeling of housing tenure choice abstract in this study a dynamic random effects simultaneous equation model is developed to model household tenure choice decision the novelty of the study lies in accounting for the dynamic aspects of housing tenure mode namely a move is prerequisite to a change in tenure mode and they are determined jointly expected mobility and tenure choice are interdependent decisions and tenure choice may be state dependent i e taste for ownership acquired or reinforced through the experience of being an owner in addition unobservable household heterogeneity is controlled by imposing a random effects specification the estimation is based on panel data from the psid using the method of maximum simulated likelihood

the revolving door duration and recidivism in imf programs quarterly evidence on participation in imf programs for the period 1974 2003 is examined statistically using the techniques of hazard analysis and error correction estimation three hypotheses are proposed and tested and the results support a revolving door explanation of participation in imf programs first an increase in cumulative prior participation in imf programs is found to cause a reduction on average in the length of a new spell of participation second the length of time between participation spells is reduced significantly with an increase in cumulative prior participation in imf programs third the evolution of reserve adequacy is shown to be significantly and positively affected by participation in imf programs the results depict a revolving door to imf participation and for those countries with prior participation the door revolves more rapidly this result is shown to depend critically upon the mix of countries considered the increase in recidivism is a phenomenon most strongly observed among the least developed countries while the reduction in duration is more strongly observed in the emerging and transition economies these results are derived while controlling for country specific unobserved heterogeneity year specific demand effects external shocks and pre existing policy distortions

estimating engel curves under unit and item nonresponse summary this paper estimates food engel curves using data from the first wave of the survey on health aging and retirement in europe share our statistical model simultaneously takes into account selectivity due to unit and item nonresponse endogeneity problems and issues related to flexible specification of the relationship of interest we estimate both parametric and semiparametric specifications of the model the parametric specification assumes that the unobservables in the model follow a multivariate gaussian distribution while the semiparametric specification avoids distributional assumptions about the unobservables copyright 2011 john wiley sons ltd

where has all the education gone cross national data show no association between increases in human capital attributable to the rising educational attainment of the labor force and the rate of growth of output per worker this implies that the association of educational capital growth with conventional measures of total factor production is large strongly statistically significant and negative these are on average results derived from imposing a constant coefficient however the development impact of education varied widely across countries and has fallen short of expectations for three possible reasons first the institutional governance environment could have been sufficiently perverse that the accumulation of educational capital lowered economic growth second marginal returns to education could have fallen rapidly as the supply of educated labor expanded while demand remained stagnant third educational quality could have been so low that years of schooling created no human capital the extent and mix of these three phenomena vary from country to country in explaining the actual economic impact of education or the lack thereof

human capital and economic growth tests based on the international evaluation of educational achievement abstract using the secondary school science achievement scores obtained by the international association for the evaluation of educational achievement this paper provides more direct tests than others on the effect of human capital on economic growth bearing important implications for theory and olicy

galton versus the human capital approach to inheritance a century ago francis galton proposed a simple yet powerful model of inheritance gary backer s human capital model is often used to analyze important empirical and policy questions but does it dominate galton s from a positive point of view i derive nine implicatiions of the human capital approach that are distinct from galton s evidence from the pis scf and nlsy micro data sets as well as results reported in previous literatures suggest that four of the unique implications are refuted two implications are verified and mixed results are obtained for three others some extensions of economics recently developed by becker and others when applied to inheritance may improve economics predictions

econometric analysis of credit constraints of chinese rural households and welfare loss using recent survey data of chinese rural households we estimate the impact of credit constraints on chinese rural households income and consumption results reveal that 71 of rural households are rationed in the credit markets the credit constraints have significant negative effects on the income and consumption of rural households the expenditures on education and medical treatments the size of land holdings household head education and the balance of financial capital all affect the demand of credit personal connections relationship are the most important determinate of the supply for credit

does school quality matter returns to education and the characteristics of public schools in the united states this paper estimates the effects of school quality measured by the pupil teacher ratio average term length and relative teacher pay on the rate of return to education for men born between 1920 and 1949 using earnings data from the 1980 census we find that men who were educated in states with higher quality schools have a higher return to additional years of schooling rates of return are also higher for individuals from states with better educated teachers and with a higher fraction of female teachers holding constant school quality measures however we find no evidence that parental income or education affects average state level rates of return

imf programs and reforms inhibition or encouragement abstract we analyze the impact of international monetary fund imf programs on market oriented reforms employing panel data for 116 countries over the period 1970 2000 we find that the net effect of imf programs on reforms is negative

geographical labour mobility migration or commuting eliasson k lindgren u and westerlund o 2003 geographical labour mobility migration or commuting reg studies 37 827 837 in this paper we examine how individual labour market status and spatial variations in employment opportunities influence interregional job search behaviour and mobility decisions in sweden the econometric analysis is based on 290 000 individual observations and refers to the years 1994 95 the empirical results show that the probability of interregional labour mobility unexpectedly decreases with the accessibility to employment opportunities in neighbouring regions as expected the findings reveal that accessibility to job openings in surrounding regions significantly increases the likelihood of choosing commuting as the mobility mode moreover the empirical findings indicate that individual unemployment experience increases the likelihood of mobility as well as migration eliasson k lindgren u et westerlund o 2003 la mobilite geographique du travail la migration

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

on us politics and imf lending abstract the political factors shaping imf lending to developing countries have attracted attention in recent empirical work this goes in particular for the role and influence of the us however scant formal modelling makes interpretation of empirical results difficult in this paper we propose a model in which the us acts as principal within the imf and seeks to maximize its impact on the policy stance of debtor countries we derive an optimal loan allocation mechanism which leads to the testable hypothesis that the probability of an imf loan is increasing in the amount of political concessions countries make a political concession is defined as the distance between a country s bliss point and its actual policy stance measured relative to the us we introduce a bliss point proxy and demonstrate that our hypothesis is strongly supported in the data moreover we show that not accounting for bliss points may lead to endogeneity bias in empirical work

wage tenure contracts in a frictional labour market firms strategies for recruitment and retention a common assumption in equilibrium search and matching models of the labour market is that each firm posts a wage to be paid to any worker hired this paper considers the implications of firms posting contracts in a random matching model with on the job search more complex contracts enable firms to address both recruitment and retention problems by for example increasing the wage with tenure the effect on the labour market is to reduce turnover below the level required for efficient matching of workers to firms copyright 2004 wiley blackwell

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

the catalytic effect of lending by the international financial institutions for many less developed countries ldcs and countries in transition cits external financing is frequently an effective constraint on economic growth and development capital inflows may be used to overcome shortages of domestic saving thereby permitting higher levels of investment as well as shortages of foreign exchange thereby permitting larger quantities of imports

models of financially repressed developing economies abstract the past decade has witnessed an explosion of research on financial sector models of financially repressed developing economies for the most part financial repression is interpreted to be the technique of holding interest rates particularly deposit rates of interest below their free market equilibrium levels the recent spate of activity in this field was produced by the simultaneous publication in 1973 of books by mckinnon and shaw both authors demonstrate how economic theory can be applied to the analysis of the effects of financial conditions on investment and the real rate of economic growth since 1973 models of financially repressed developing economies have been formalized mathematically extended to open economies in order to analyse exchange rate policies and tested empirically this paper presents a critical survey of the major contributions to the literature in this field since 1973

the impact of real rents and wages on household formation although the economic literature has analyzed some components of the headship decision study of household formation has been primarily in the realm of demography the authors expand the demographic model to include economic determinants of the decision to remain with parents or not and to live with a group or separately they focus on measuring the effect of spatial variations in rental costs on the probability of forming a household the authors results based on a sample of 2 573 youths in their twenties indicate that the cost of housing and potential labor earnings are important variables in explaining this probability copyright 1993 by mit press

the unemployment volatility puzzle is wage stickiness the answer i discuss the failure of the canonical search and matching model to match the cyclical volatility in the job finding rate i show that job creation in the model is influenced by wages in new matches i summarize microeconometric evidence and find that wages in new matches are volatile and consistent with the model s key predictions therefore explanations of the unemployment volatility puzzle have to preserve the cyclical volatility of wages i discuss a modification of the model based on fixed matching costs that can increase cyclical unemployment volatility and is consistent with wage flexibility in new matches

intertemporal analysis of employment decisions on agricultural holdings in slovenia the article attempts to quantify determinants influencing the dynamics of employment decisions on agricultural holdings in slovenia and to test specific aspects of labor reallocation during the transition period by the application of an agricultural household model through the use of a 1991 2000 longitudinal data set for 22 055 farm households quantitative analysis of intertemporal employment decisions by farm holders is carried out using probit techniques the determinants tested relate to the personal characteristics of farm holders gender age education level and potential off farm income household characteristics size structure characteristics of the agricultural holding economic size labor intensity and local labor market conditions the model results generally confirm existing empirical evidence on asymmetrical and irreversible participation of holders on the labor market despite intensive restructuring of agriculture and profound changes in the nonfarm labor market in the analyzed period labor supply of farm holders remains rigid the mobility of labor supply is lower than expected which can be attributed to the importance of structural problems constraining intersectoral mobility low labor mobility reduces the efficiency of labor allocation on agricultural holdings in slovenia elements of this problem emerge on both supply e g low level of educational and professional attainment of reference persons and demand sides of the labor market e g unfavorable local labor market conditions a marked tendency toward maintaining the same employment status is more distinct in the case of holders employed on farm only

imf conditionality conceptual problems and policy alternatives abstract this paper argues that the main issue damaging relations between developing countries and the international monetary fund is the latter s position that external disequilibria are always a consequence of excess aggregate domestic demand caused by excessive credit expansion as a result fund sponsored stabilization programs center on demand contraction through a credit crunch and may establish stricter domestic performance criteria than necessary to attain the balance of payments objectives the author suggests that the imf establish a two tier conditionality system which he calls the hands off approach with one tier composed exclusively of balance of payments or foreign exchange denominated variables and the other of domestic currency denominated variables the two tier system would allow more flexibility in compliance assessment and might reduce substantially the number of breakdowns of fund programs a revised hands on approach for the fund is also suggested the author critiques the recessive biases of the currently used financial analytical exercises and makes specific proposals to introduce growth exercises to establish the foreign credit requirements of a growth oriented stabilization program and thus to introduce performance criteria for creditor countries and banks a form of reciprocal conditionality

economic growth export and external debt causality the case of african countries empirical investigation of the export driven economic growth hypothesis has provided mixed results in a bivariate causality framework the problem with such bivariate causality analysis is that there can be an omitted variable which could adversely affect the results this paper looks at the trivariate causality analysis of african countries by introducing external deby servicing as a third variable in the export economic growth analysis the results indicate that there is a feedback or bidirectional causality between external debt servicing economic growth and exports evidence of the 1983 90 subperiod is consistent with the argument that the structural adjustment programmes which were designed to remove economic distortions promote exports and encourage external debt management increased growth in the countries involved

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

the empirical content of the job search model labor mobility and wage distributions in europe and the us abstract job search models of the labor market hypothesize a very tight correspondence between the determinants of labor turnover and individual wage dynamics on one hand and the determinants of wage dispersion on the other this paper offers a systematic examination of whether this correspondence is present in the data by estimating a rudimentary partial equilibrium job search model on a three year panel of individual worker data covering 10 european countries and the u s we find that our basic job search model fits the data surprisingly well this also allows us to point at a number of interesting empirical regularities about wage distributions our results suggest that cross sectional data on individual wages contain the basic information needed to obtain a reliable measure of the magnitude of labor market frictions as measured by a parameter of the canonical job search model finally we use our results in a cross country comparison of the intensity and nature of job to job turnover we arrange countries into two different groups according to their turnover intensity we further show that the nature of job to job turnover is very different between those two groups turnover is predominantly voluntary in low turnover countries whereas it is to a large extent involuntary in high turnover countries

an equilibrium model of health insurance provision and wage determination we investigate the effect of employer provided health insurance on job mobility rates and economic welfare using a search matching and bargaining framework in our model health insurance coverage decisions are made in a cooperative manner that recognizes the productivity effects of health insurance as well as its nonpecuniary value to the employee the resulting equilibrium is one in which not all employment matches are covered by health insurance wages at jobs providing health insurance are larger in a stochastic sense than those at jobs without health insurance and workers at jobs with health insurance are less likely to leave those jobs even after conditioning on the wage rate we estimate the model using the 1996 panel of the survey of income and program participation and find that the employer provided health insurance system does not lead to any serious inefficiencies in mobility decisions

a bivariate probit approach to the determination of employment a study of teen employment differentials in los angeles county following a bivariate probit approach and using the 1990 public use microdata samples pums for los angeles county this study shows that the employment of teenage workers depends on both the worker s participation decision as well as the employer s hiring decision omission of the role of participation decision from the estimation of employment probability yields misleading evidence of hiring discrimination against blacks this evidence however disappears when the participation and hiring equations are estimated jointly in a bivariate framework the study finds no evidence of discrimination against females and latinos in addition the study shows that family household and neighbourhood characteristics play significant roles in the determination of teen employment

loss severities on residential real estate debt during the great recession abstract this study develops estimates of expected loss severities on mortgage exposures using data from florida during the great recession this paper marks the first attempt at addressing sample selectivity in the context of loss models we also construct measures of home equity that are more accurate than those employed in previous studies we find that failing to address sample selection and the use of noisy equity measures in loss models can bias loss estimates significantly we also find significantly higher loss severities and a greater sensitivity of loss severity to equity than what previous studies report

suspension of payments bank failures and the nonbank public s losses abstract we present evidence on the effects of suspensions of payments from an episode that is close to a controlled experiment for examining those effects in 1861 about 44 of the banks in wisconsin closed 81 of the banks in illinois closed and noteholders suffered substantial losses the historical record suggests that an effective suspension of payments in wisconsin but not in illinois may explain the difference our statistical evidence indicates that the suspension of payments increased the probability of a bank remaining open by about 21 percentage points and decreased noteholders losses by about 14 cents per dollar

what explains the success or failure of structural adjustment programs in the 1980s development assistance shifted largely from financing investments such as roads and dams to promoting policy reform this change came because of a growing awareness that developing countries were held back more by poor policies than by a lack of finance for investment after nearly 20 years experience with policy based or conditional lending there have now been many studies of adjustment lending most of which take a case study approach many conclude that policy based lending works if countries have decided on their own to reform the authors examine a database of 220 world bank supported reform programs to identify why adjustment programs succeed or fail they find that a few political economy variables can successfully predict the outcome of an adjustment loan 75 percent of the time variables under the world bank s control resources devoted to preparation and supervision or number of conditions have no relationship with an adjustment program s success or failure what development agencies must do then is select promising candidates for adjustment support when the candidates is a poor selection devoting more administrative resources or imposing more conditions will not increase the likelihood of successful reform to improve its success rate with adjustment lending the world bank must become more selective and do a better job of understanding which environments are promising for reform and which are not that is likely to lead to fewer adjustment loans unless there is a significant change in the number of promising reformers to become more effective at supporting policy reform the agency must be willing to accept that this may lead to smaller volumes of lending

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

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

remittance receipt and business ownership in the dominican republic using household level data from the dominican communities in the latin american migration project lamp dr7 we examine the links between remittance receipt and business ownership we find that while the existence of a family business attracts remittance inflows these monetary funds are associated with a reduced likelihood of business entrepreneurship these results are consistent with various hypotheses regarding remittances and business investments first remittances may be motivated by the availability of investment opportunities in the home community second remittances may respond to a bequest motive on the part of the emigrant who may wish to lay claim on family assets when returning home lastly remittances may cause an income effect that reduces family labour force participation and correspondingly the likelihood of family run business investments

the economic impact of short term imf engagement in low income countries summary this study estimates the economic impact of imf supported programs addressing policy and exogenous shocks in low income countries lics using the propensity score matching approach focusing on a more homogenous group of financing events greatly improves the specification and predictive power of the selection model as compared to earlier studies which is the key requirement to control for selection bias this paper looks into a wide range of potential economic and political determinants of participation lower reserve coverage deterioration in the current account balance a weaker real gdp growth increased macroeconomic instability evident in higher fiscal deficits inflation and exchange market pressures and lagged elections would increase the probability of participation i e propensity scores moreover global conditions including changes in real oil and non oil commodity prices and world trade are also significant therefore adverse global shocks could create cycles in demand for imf financing the short term imf engagement is positively associated with a wide range of macroeconomic outcomes notably the impact on the short term growth is the greatest and becomes significant only for lics facing substantial macroeconomic imbalances or large exogenous shocks when matching accounts for propensity scores and institutional quality program countries in this group have changes in growth 1 5 and 3 5 percentage points higher than the control group

a new international database on education quality 1965 2010 the aim of this paper is to propose a new database allowing a comparative evaluation of the relative performance of schooling systems around the world we measure this performance through pupils achievement in standardized tests we merge all existing regional and international student achievement tests by using a specific methodology compared to other existing databases our approach innovates on several ways especially by including regional student achievement tests and intertemporal comparable indicators we provide a dataset of indicators of quality of student achievement iqsa for 103 countries areas in primary education and 111 countries areas in secondary education between 1965 and 2010

the effect of imf programs on labor abstract previous studies find that imf programs have negative effects on income distribution the international monetary fund and latin america economic stabilization and class conflict westview press boulder 1987a world dev 15 1987b 365 world dev 28 2000 1031 no study however has used parametric methods to control for nonrandom selection using a dynamic version of the heckman selection model i study the effect of imf programs on the labor share of income from manufacturing my conclusions are supported by 2 095 observations of 110 countries during 1961 93

on the job search productivity shocks and the individual earnings process individual labor earnings observed in worker panel data have complex highly persistent dynamics we investigate the capacity of a structural job search model with i i d productivity shocks to replicate salient properties of these dynamics such as the covariance structure of earnings the evolution of individual earnings mean and variance with the duration of uninterrupted employment or the distribution of year to year earnings changes specifically we show within an otherwise standard job search model how the combined assumptions of on the job search and wage renegotiation by mutual consent act as a quantitatively plausible internal propagation mechanism of i i d productivity shocks into persistent wage shocks the model suggests that wage dynamics should be thought of as the outcome of a specific acceptance rejection scheme of i i d productivity shocks this offers an alternative to the conventional linear arma type approach to modelling earnings dynamics structural estimation of our model on a 12 year panel of highly educated british workers shows that our simple framework produces a dynamic earnings structure which is remarkably consistent with the data