short run strategies for attracting foreign direct investment this paper empirically investigates the effectiveness and feasibility of two fdi policies fiscal incentives and deregulation aimed at improving the attractiveness of a country in the short run using disaggregated data on sales by us mnes foreign affiliates in 43 developed and developing countries over the 1982 94 period results show that the provision of fiscal incentives or the deregulation of the labour market would exert a positive impact on total fdi given the drawbacks frequently associated with the use of incentive packages economy wide policies which ease firing procedures and reduce severance payments would certainly be the best policy option this paper also highlights the different aggregation and omitted variable biases that have affected results of previous studies and provides some support to recent theoretical models of fdi by showing that third country effects and spatial interdependence influence respectively the location of export platform fdi and vertical fdi

earnings effects of labor organizations in 1890 analyzing data from extensive surveys of u s nonfarm families in 1889 90 predominantly families from eastern states the authors of this paper show that workers affiliated with labor organizations had earnings that were 22 percent higher than the earnings of other workers an effect comparable in magnitude to estimates for modern unions wage differentials varied considerably across the eight industries studied and across skill levels within each industry

taxes and bank capital structure this paper shows that a reduction in tax discrimination between debt and equity funding leads to better capitalized financial institutions the paper exploits exogenous variation in the tax treatment of debt and equity created by the introduction of a tax shield for equity the results demonstrate that a more equal treatment of debt and equity increases bank capital ratios driven by an increase in common equity the change also leads to a significant reduction in risk taking for ex ante low capitalized banks overall the findings suggest that tax shields could be a valuable and innovative policy tool for bank regulators

rent seeking over time the continuity of capture recently in this journal skaggs and wasserkrug 1983 presented a model of bureau monitoring and related it to federal reserve behavior central to their argument was that bureau constituencies may pressure congressmen in maintaining the monitoring status quo if competition is to be expected between self interested parties for the property rights associated with regulation and regulatory commissions then bureau monitoring or lack of it should have value the capture of a commission by others is made more costly when information on a bureau s activities is restricted in general the issues surrounding bureau monitoring bring out the dynamic nature of the capture theory of regulation once captured commissions must remain captured if benefits are to accrue to rent seekers over time empirical support for the capture perspective however only relates personal characteristics of the appointed regulators commissioners to characteristics preferred by the regulated to reveal the dynamic nature of capture one must also account for the continuity of commission membership a captured regulatory body can only remain captured if there is a continuity of desirable characteristics by compiling characteristics of appointed members previous studies have examined the output of the appointment process that resulted from competition for positions on regulatory boards however the lack of synchronization between appointments to federal regulatory commissions and presidential elections suggests that the distribution of influence among self interested groups in the selection process may vary over time thus continuous successful capture is more easily achieved if appointees remain on boards for full terms and if possible land reappointments but the process is complicated further because regulators

scale effects in multi unit auctions abstract we argue that auctions with multi unit demand can be used to experimentally conduct new and novel tests of auction theory the focus of the paper is on changes in bidding behavior as the auction is scaled up by adding more bidders and increasing both the demand per bidder and supply of the auctioned good we identify uniquely tractable environments and obtain clear cut theoretical comparative statics in these settings this leads to the construction of uniform price auctions of different scales where the prediction is that risk neutral bidders bids on the last unit they demand are independent of scale in our experiment bidders on average bid much more aggressively than predicted by theory there is also evidence of a scale effect with more aggressive bidding in the small scale treatment compared to the large scale treatment it is argued that these features are consistent with joy of winning and anticipated regret

rewards to academia the remuneration of vice chancellors and principals this paper models the financial remuneration to vice chancellors and principals at uk higher education institutions after describing the alternative theoretical underpinnings for the determination of pay an earnings function is estimated utilizing institutional and personal characteristics the model suggests only a partial linkage of managerial and performance related indicators to remuneration levels this suggests substantial scope for reorientation of rewards towards such indicators rather than relying on an efficiency wage this would appear particularly appropriate given the present and continued disclosure of this information together with the increased focus on performance indicators relating to teaching and research within the uk higher education sector

towards a new trade policy between the usa and middle east countries estimating trade resistance and export potential at the time of the conclusion of free trade areas ftas between the usa and middle east and north african mena countries there is a lack of literature concerning the measurement of the current us export position with regards to these countries and the us export potential in this area from recent developments of gravity models this paper derives an estimable equation which includes various trade resistance variables notably border effects multilateral resistance as well as specific bilateral effects the model is tested in order to scrutinise the impact of these variables on us exports to mena countries as well as the us export potential in this area to that end a selection of panel data specifications is proposed mainly hausman and taylor models as well as arellano and bond dynamic models results unambiguously indicate that as compared to the other oecd countries the usa suffers from a substantial trade integration deficit with mena countries this is reflected by the strongly negative values of the us mena bilateral fixed effects as well as the high bilateral border effects in addition the estimated actual potential us export ratio to these countries is only 0 76 therefore implementing an fta between the usa and mena countries may allow the former to progressively improve its export position in this area this would also help mena countries diversify their supplying sources

the economic effects of withdrawn antidumping investigations is there evidence of collusive settlements abstract this paper analyzes the effects of antidumping cases initiated from 1990 to 1997 that ended in withdrawn petitions without a suspension agreement or voluntary restraint agreement monthly import data are used to estimate the price and quantity effects of the withdrawn cases the estimated effects of the petition being withdrawn do not support the accepted wisdom that withdrawn petitions are a signal of collusion this is an important issue since out of court settlements of unfair trade cases which restrict quantities or increase prices are not only welfare reducing but are also actionable under the antitrust laws they are not exempt under the noerr pennington doctrine

expert opinion and cuisine reputation in the market for restaurant meals as food is an experience good the market for restaurant meals is a market where the cost of acquiring information regarding quality is relatively high in such markets consumers often turn to reputation measures to guide purchase decisions as australia does not have a longstanding cuisine style of its own and given australia has been open to substantial immigration inflows since federation it represents an especially appropriate market to study regarding the impact of individual restaurant reputation and collective cuisine reputation on meal prices the following study uses the hedonic price approach to investigate the implicit price of individual reputation indicators cuisine type reputation indicators and other objective indicators in the market for restaurant meals the empirical findings presented suggest that both individual restaurant reputation and cuisine type reputation are important other important factors are shown to include the quality of the restaurant wine list the availability of pr

do corporations sell houses for less a test of housing market efficiency this paper examines the popular notion that houses sold by corporations as a part of the employee relocation process sell at a discount we argue that such discounts conradict the notion of an efficient market in which indentical houses have the same expected sales price we test for corporate individual owned house price homogeneity using data from a metropolitan area in the us the evidence supports our single price hypothesis corporate houses do not sell for less than they would if sold by individuals

willingness to pay of committed citizens a field experiment in this paper we propose a behavioral approach to determine the extent to which the consumer citizen distinction affects interpretations of monetary values in stated preferences methods we perform a field experiment dealing with air pollution where some randomly selected subjects are given the opportunity to behave politically by signing a petition for environmental protection prior to stating their private preferences in a standard contingent valuation exercise we show that signing has the potential to influence respondents willingness to pay values results indicate that even market like situations are not immune to citizen behavior

does remuneration affect the discipline and the selection of politicians evidence from pay harmonization in the european parliament we study the harmonization of the base pay for the members of the european parliament meps prior to this reform implemented in 2009 base pay was aligned with that of national parliamentarians causing large differences in pay between the meps representing 27 member states based on detailed information on individual meps between 2004 and 2011 we find that the reform which introduced an exceptional base pay increase of 200 per national delegation on average has a positive incentive effect on in office effort proxied by the number of speeches written declarations and reports drafted however more generous remuneration is associated with higher rates of absenteeism with respect to political selection we find that higher pay also raises reelection rates the composition of the pool of meps in terms of ex ante quality approximated by formal education previous political experience in elected office and occupational background is however unaffected if we restrict our attention to newly elected meps a salary increase is related to fewer meps with previous political experience at the highest national level

labour productivity in the british and south wales coal industry 1874 1914 naked to the waist hot and grimy with labour they squatted on their heels for a few minutes and talked seeing each other dimly by the light of the safety lamps while the black coal rose jutting around them and the props of wood stood like little pillars in the low black very dark temple the day passed pleasantly enough there was an ease a go asyou please about the day underground a delightful camaraderie of men shut off alone from the rest of the world in a dangerous place and a variety of labour holing loading timbering and a glamour of mystery and adventure in the atmosphere d h lawrence 1955 the above quote from d h lawrence while perhaps over emphasizing glamour and adventure illustrates one important aspect of colliery work the intensity of a collier s effort was primarily self imposed it was the work intensity combined with other factors that determined labour productivity in the coal mines a number of articles have addressed the problem of labour productivity in coalmining during the late nineteenth and early twentieth centuries two of the most important being a j taylor s 1961 examination of productivity and technological change in britain and r h walters 1975 analysis of the same topic for south wales 1 in addition there is a rich and growing literature on the broader problem of the existence of a climacteric a downward shift in the performance of the british economy in the late nineteenth century often attributed to the failure of british entrepreneurs as represented by their seeming unwillingness to adopt the best available techniques of production 2 the purpose of this paper is to specify and estimate an empirical model of labour productivity in coalmining as well as to provide some suggestive evidence regarding the performance of entrepreneurs in this major industry 3 we believe our results provide added insight into the determination of labour productivity during this period lending support to those who argue that the failure of british entrepreneurs has yet to be proved while providing mixed evidence regarding conclusions drawn by economic historians

adaptation to an irrigation water restriction imposed through local governance abstract we estimate how farmers adapted to a water restriction imposed through local governance the restriction imposed a uniform quota on water use with a 5 year allocation and allowed trading of the quota within the restricted area our analysis exploits unique micro level data on irrigated water use irrigated acreage and crops we use a difference in differences econometric strategy that also includes farmer time fixed effects to estimate the response to the restriction where we exploit water rights between 2 and 5 miles of the policy boundary as a control group results indicate that farmers reduced water use by 26 due to the policy with most of the response due to reductions in water use intensity on the same crops rather than through reductions in irrigated acreage or changes in crops the results imply that the short run welfare impact of the policy was smaller than a policy that reduces irrigated acreage

revisiting electricity liberalization and quality of service empirical evidence from new zealand abstractwhat effect does the firm structure have on the quality of service delivered by networks and infrastructure industries we answer this question by empirically assessing the impacts of complete vertical separation such as ownership unbundling on the quality of service delivered by a liberalized network industry electricity distribution utilities in new zealand are considered for this purpose and are analysed using panel data econometrics the results show robust evidence that ownership unbundling contributed to a fall in the duration and frequency of supply interruptions in electricity distribution however the results also show that unbundling has no effect on reducing distribution network losses these results overall highlight the nonsimple impacts of ownership unbundling on the quality of electricity distribution we suggest that the quality of service may largely improve when considered in the economic regulation of electricity networks than completely relying on specific reform measures

the earnings of canadian immigrant and native born males this paper examines the economic attainment of canadian immigrants although foreign born males initially earn less than the native born their earnings rise more rapidly with canadian labour market experience and after 14years their earnings equal and exceed those of the native population it is also shown that the use of mincer s identity leads to biased results when estimating the earnings of the immigrant population

paying for mitigation a multiple country study a contingent valuation study conducted in china sweden and the united states was used to investigate citizens willingness to pay wtp for reducing co2 emissions we find that a majority of the respondents in all three countries believe that the mean global temperature has increased over the last 100 years and that humans are responsible for the increase the share of americans that believes these statements is smaller and a relatively larger share of americans also believes that nothing can be done to stop climate change sweden has the highest wtp while china has the lowest jel q51 q54

when quality signals talk evidence from the turin hotel industry abstract this study analyzes the relationship between quality signals and price setting through the application of hedonic price functions the model proposals also include variables relating to land use policies and tourism development strategies a simultaneous equation model endogenously estimates quality signals this method is appropriate for analyzing emerging urban destinations as characterized by the presence of an expanding hotel industry the results are based on a dataset of 145 hotels in turin italy the empirical findings reveal that reputation based quality signals help explain tariff levels price proposals also include a premium for quality assured hotels defining some limits of the current hotel classification system the empirical evidence has significant marketing implications for the hospitality industry s competitiveness since the results clarify the impact of quality signals on price level

the charity of the extremely wealthy our experience worldwide is that first generation wealth is actually more generous than dynastic wealth both here in india and u s and other countries the biggest givers are those who are receivers of first generation wealth bill gates quoted in thakur lee and frye 2011 i introduction in this article we study the charitable behavior of billionaires focusing on the impact of the source of their wealth on their charitable donations and pledges while billionaires play a leading role in both the economy and in philanthropy and they are watched closely by journalists and the public at large econometric studies that focus on the behavior of billionaires are rare 1 understanding the charitable behavior of the extremely wealthy is important because they are responsible for a disproportional share of overall giving directly through the amounts of money they give and also because their public status makes their behavior an example for others to follow while the determinants of individual giving have already been studied in experimental settings and using surveys reinstein and riener 2012 steinberg et al 2011 this article documents charitable behavior of a larger magnitude than that typically studied in experiments and of people who do not participate in experiments or fill out surveys 2 our analysis focuses on the question of whether self made billionaires are more charitable than billionaires who inherited their money as bill gates suggested in the quote above it is well documented that people s decisions on how to spend money often depend on how they received that money epley mak and chen idson 2006 for example show that the propensity to consume is bigger if income received is framed as a bonus rather than a rebate arkes et al 1994 show that windfall gains are more readily consumed than nonwindfall gains such evidence has been found both inside and outside the laboratory but in this article we investigate whether treatment of income varies depending on its source when the amounts at stake are much larger than previously studied in the literature in this article amounts range from millions to billions of dollars in comparison with the tens or hundreds of dollars in experimental literature or the tens of thousands of dollars studied in the research on decisions in every day life moreover studies that investigate how spending varies with the source of money typically conclude that earned income is spent more carefully than windfall gains however in the case of charitable giving self made money seems to be more rather than less likely to be spent on charity than inherited money steinberg et al 2011 indeed show using data from the charitable giving module of the panel study of income dynamics psid that the presence of inherited wealth increases giving but also that income held constant an increase in the proportion of income coming from an inheritance is associated with a decrease in charitable giving 3 to study the charitable behavior of the extremely wealthy we use data from the giving pledge a global public pledge to give away at least half of one s fortune during one s lifetime http givingpledge org which by now has been signed by more than 100 extremely wealthy people typically current billionaires in addition we use data on the presence of u s billionaires in the philanthropy top 50 and in the million dollar list a list of those who have given grants of 1 million or more since 2000 we find evidence that self made billionaires are three to four times more likely to sign the giving pledge and to enter the philanthropy top 50 list of biggest pledges compared with those who inherited their wealth at the same time we find that the gap in probabilities between self made and inherited wealth is much smaller at about 28 when looking at the presence in the million dollar list we also find that self made billionaires give more on average than inherited billionaires do when measuring total gifts using the million dollar list or the philanthropy top 50

the race is to the swift socioeconomic origins adult education and wage attainment the winners in today s winner take all labor markets are differentiated by advanced levels of educational attainment especially higher degrees this article applies a sociological model of cumulative dis advantage to the baby boom cohort to examine whether life course timing differences in educational attainment help explain wage differentials by midlife it finds that advantaged social origins lead to early postsecondary completion of degrees which in turn yield higher wages a pathway of cumulative disadvantage is also evident where those least advantaged exit schooling early in life do not return as adults and earn low wages in a middle path advantaged social origins promote adult school attainment primarily for those without degrees but generally without the wage boosts associated with attainment earlier in life

room in the kitchen for the melting pot immigration and rental prices this paper studies the response of housing markets to immigration shocks following card 1990 i examine the changes in rental prices in miami and three comparison groups after the mariel boatlift this exogenous immigration shock added an extra 9 to miami s renter population in 1980 i find that rents increased from 8 to 11 more in miami than in the comparison groups between 1979 and 1981 by 1983 the rent differential was still 7 rental units of higher quality were not affected by the immigration shock units occupied by low income hispanic residents in 1979 experienced an extra 8 differential hike with respect to other low income units relative housing prices moved in the opposite direction from rents in the short run

scanner data and the treatment of quality change in nonrevisable price indexes the recently developed rolling year geks procedure makes maximum use of all matches in the data to construct nonrevisable price indexes that are approximately free from chain drift a potential weakness is that unmatched items are ignored in this article we use imputation tornqvist price indexes as inputs into the rolling year geks procedure these indexes account for quality changes by imputing the missing prices associated with new and disappearing items three imputation methods are discussed the first method makes explicit imputations using a hedonic regression model which is estimated for each time period the other two methods make implicit imputations they are based on time dummy hedonic and time product dummy regression models and are estimated on bilateral pooled data we present empirical evidence for new zealand from scanner data on eight consumer electronics products and find that accounting for quality change can make a substantial difference

effectiveness of rca institutions to limit local externalities using foreclosure data to test covenant effectiveness residential community associations rcas are said to be an efficient institutional agreement to limit local spillovers while several studies have identified a positive marginal effect of rca rules none have explicitly measured the effectiveness of these institutions to limit local externalities this study measures this effectiveness by estimating how the direct and spillover price impacts caused by foreclosure differ by rca status using a spatial hedonic model that controls for selection bias using propensity score methods and coarsened exact matching we find that foreclosed rca properties experience smaller direct foreclosure discounts and produce smaller spill over effects than their non rca counterparts

look who s talking the impacts of the intrahousehold allocation of mobile phones on agricultural prices abstract using data from the philippines we study the impact of mobile phones on the prices agricultural producers receive for their cash crop we first look at the impact on price of mobile phone ownership at the household level because this masks a considerable amount of heterogeneity we then look at the impact on price of the intrahousehold allocation of mobile phones we find that whether the household owns a mobile phone has no impact on price but whether a farmer or spouse owns a mobile phone is associated with a 5 to 8 per cent increase in price

the impact of leniency and whistle blowing programs on cartels antitrust authorities have set up leniency programs for cartel members that denounce their collusive agreements these programs help prosecute participants and can thereby deter collusion we compare the impact of reduced fines and positive rewards and argue that rewarding individuals including firm employees can deter collusion in a more effective way we discuss possible adverse effects of whistle blowing programs on firms behavior and particularly on turnover incentives to innovate and cooperation we also explore explanations for the puzzling fact that managers keep incriminating evidence and argue reward programs actually provide additional incentives for keeping such evidence

does price dispersion increase with quality evidence from the online diamond market this article empirically investigates the relationship between price dispersion and price level searches seem more valuable for products of high quality but buyers may have little incentive to search since such products are less frequently purchased the extent of price dispersion is examined using a sample of around 160 000 diamonds offered for sale online estimates from a two stage econometric strategy show that price dispersion increases significantly with quality an explanation is that buyers of high quality gemstones pay little attention to the price of these diamonds and even more so if they perceive high prices as signals of quality and rarity of the diamonds they intend to purchase

environmental amenities as a source of market power site specific environmental amenities can provide a source of product differentiating market power using estimates from hedonic price equations and residual demand models our analysis recovers firm specific estimates of price markups as measures of market power and uses these markups to estimate the implied marginal value for access to coastal beaches the application involves rental price and occupancy data for several thousand beach properties along a portion of the north carolina coastline during the 1987 to 1992 rental seasons

unions industrial concentration and wages a re examination market structure or industrial concentration has long been recognized as an important influence on industrial output employment and profits it has also been recognized that some proportion of the profits from concentration may be diverted into wages through collective bargaining yet the precise nature of these relationships has received little attention although it has important implications for the evaluation of wage structure and the welfare loss arising from monopoly empirical studies of the impact of unions and industrial concentration on wages weiss 1966 jones and laudadio 1975 dalton and ford 1977 long and link 1983 follow a similar format after a brief verbal justification for the ability of unions to win higher wage increases when the employer is earning oligopoly profits these studies specify a wage equation of the general form

the returns to education in africa some new estimates abstractwe estimate the rate of return to education for 12 african countries using recent data and a range of methodologies which we apply consistently across all countries our findings confirm that the return to basic education is the lowest 7 10 the returns to upper secondary and tertiary education are similar to one another 25 30 accounting for the risk of joblessness increases these rates of return particularly for basic education and for women at tertiary level our results at the country level suggest that great care should be taken in choosing the appropriate methodology to estimate rates of return

payment source and the cost of hospital care evidence from a multiproduct cost function with multiple payers abstract this study investigates the capacity of hospitals to vary the intensity of their services based on patients expected sources of payment while the concept of price discrimination by hospitals based on payer generosity cost shifting has been discussed extensively the notion that hospitals can adjust payer specific marginal costs to reflect differences in reimbursement policies has not been studied in depth to examine this issue this analysis employs a multiproduct cost function with hospital outputs defined as admissions by payment source controlling for the distribution and severity of illness casemix for each payer marginal costs of casemix adjusted discharges are obtained and compared for medicare medicaid private payers and a residual category that includes uncompensated care we find that indeed payer specific marginal costs generally reflect payer generosity

property rights and productivity the case of joint land titling in vietnam this paper explores the effect of land titling on agricultural productivity in vietnam and the productivity effects of single versus joint titling for husband and wife using a plot fixed effects approach our results show that obtaining a land title is associated with higher yields for both individually and jointly held titles we conclude that there is no tradeoff between joint titling and productivity and so joint titles are potentially an effective way to improve women s bargaining power within the household with no associated efficiency losses

the effect of ama membership on physicians earnings this study explores earnings differences between physicians who are members of the american medical association and physicians who are not ama members nonmembers earn on average about 22 percent less per hour of medical practice than members an estimate of the earnings effect of ama membership incorporating the simultaneous determination of earnings and membership suggests however that membership per se increases physicians hourly practice earnings only by about 2 7 percent