monetary fiscal policy interactions and indeterminacy in postwar us data using a micro founded model and a likelihood based inference method we address three questions in this article first what monetary and fiscal policy regimes characterized postwar us data second was equilibrium indeterminacy a feature of the economy before paul volcker s chairmanship at the federal reserve third what were the effects of shifts in monetary and fiscal policy on the aggregate economy we find that pre volcker a passive monetary and fiscal policy regime prevailed while postvolcker an active monetary and passive fiscal policy regime characterized the economy 1 since both monetary and fiscal policies were passive pre volcker there was equilibrium indeterminacy moreover the effects of monetary and fiscal policy shifts on the aggregate economy were substantially different in the two time periods for example while pre volcker an unanticipated increase in interest rates led to an increase in output and inflation post volcker it led to a decrease in output and inflation moreover while pre volcker an unanticipated increase in the lump sum tax revenues to output ratio led to a decline in output and inflation post volcker it had no effects on output or inflation the response of the economy pre volcker was thus similar to that predicted by the fiscal

remittances and income diversification in bolivia s rural sector this article examines the role of remittances in income diversification strategies in bolivia s rural sector remittances can be consumed or invested by the recipient as an investment funds can be used for farming or to finance other nonfarm productions in this article we use a large and nationally representative survey to estimate the effect that remittances have on the probability of producing income from nonfarm activities diversification by using a bivariate probit model our evidence shows that remittances increase the probability that a rural family engages in nonfarm activities at least in some regions of bolivia we also find evidence that the sender s decision to remit and the recipient s decision to diversify may be jointly determined as such this suggests that remittances may serve as a mechanism to overcome localized failures in bolivia s capital markets

oppositional identities and employment for ethnic minorities evidence from england where a community or group is socially excluded from a dominant group some individuals of that group may identify with the dominant culture and others may reject that culture the aim of this article is to investigate this issue by empirically analysing the potential trade off for ethnic minorities between sticking to their own roots and labour market success we find that the social environment of individuals and attachments to culture of origin has a strong association with identity choice our results also suggest that those non whites who have preferences that accord with being oppositional do experience an employment penalty

the determinants of migrant remittances this article explores the factors that account for variation in remittance flows why do some immigrants send much more money to their country of origin than others this is a question that in the aggregate has implications for national economies and migration related policy the analysis departs from the classic studies of remittances and considers how the context of contemporary migration in europe is likely to affect remittance patterns possible influences on remittance sending are disaggregated into nine domains and each is discussed with reference to theoretical arguments and empirical findings the temporal aspects of remittance sending are discussed separately the final section of the article considers implications of the micro level analysis for aggregate remittance flows and policy it is argued that the focus on altruism versus self interest in the literature has partly diverted attention from explaining the actual variation that is important in a policy perspective

are ghettos good or bad spatial separation of racial and ethnic groups may theoretically have positive or negative effects on the economic performance of those groups we examine the effects of segregation on outcomes for blacks in schooling employment and single parenthood we find that blacks in more segregated areas have significantly worse outcomes than blacks in less segregated areas we control for the endogeneity of location choice using instruments based on political factors topographical features and residence before adulthood a one standard deviation decrease in segregation would eliminate one third of the black white differences in most of our outcomes

money transfers among banked and unbanked mexican immigrants the recent recognition of the matricula consular as an acceptable form of alien identification by financial institutions has increased undocumented mexican immigrants access to u s banking services usage of the banking system s low cost wiring and money transfer services may encourage mexican immigrants to save and potentially transfer more money to mexico we use data from the mexican migration project mmp107 to examine the hypothesis that immigrants with access to banking services in the united states between 1970 and 2004 sent back more funds to mexico than their unbanked counterparts we find that banking among mexican immigrants in our sample is limited while having a u s bank account does not appear to significantly raise monthly remittance flows by mexican immigrants it does help boost the amount brought back home thus our analysis sheds light on the potential effects of matricula cards on the future flow of remittances to mexico

an economic analysis of acting white this paper formalizes a widely discussed peer eect entitled acting white acting white is modeled as a two audience signaling quandary signals that induce high wages can be signals that induce peer group rejection without peer eects equilibria involve all ability types choosing dierent levels of education acting white alters the equilibrium dramatically the possibly empty set of lowest ability individuals and the set of highest ability individuals continue to reveal their type through investments in education ability types in the middle interval pool on a common education level only those in the lower intervals are accepted by the group the model s predictions t many stylized facts in the anthropology and sociology literatures regarding social interactions among minority group members

cultural leader and the dynamics of assimilation abstract this paper studies the population dynamics of cultural traits in a model of intergenerational cultural transmission with a perfectly forward looking cultural leader we show that there exists a threshold size in terms of population above which the cultural leader becomes active we also show that a policy affecting some key parameters such as the cost of providing the religious good has a different impact in the short run and in the long run due to over reactions or under reactions of the different cultural groups finally we study the cultural competition between two forward looking cultural leaders with opposite objectives we show that the steady state cultural equilibrium depends on the time preference structure of the two leaders

migration friendship ties and cultural assimilation we study migrants assimilation by analyzing whether friendship with natives is a measure of cultural assimilation and by investigating the formation of social ties using the german socio economic panel we find that migrants with a german friend are more similar to natives than those without along several important dimensions including concerns about the economy interest in politics and a host of policy issues turning to friendship acquisition we find that becoming employed time spent in the host country the birth of a child residential mobility and additional education acquired in the host country are significant drivers of social network variation

subjectively assessed welfare and international remittances evidence from tonga using data from a customised household survey in tonga we assess the responsiveness of migrants remittances to perceived needs of recipients we extend a mixed motives model incorporating subjectively assessed recipient welfare we find evidence supportive of altruism for households below a subjective threshold implying that remittances provide important social protection for the poor we also find a positive relationship for those above the threshold implying that welfare improvements in migrant sending countries could increase or decrease remittance flows depending on pre transfer welfare level the effects of remittances on poverty alleviation and income distribution are hence more complex and ambiguous than previous studies suggest

sharing norm pressures and community remittances evidence from a natural disaster in the pacific islands abstractmigrants are often subject to social pressures to remit beyond their own households to share the benefits of migration with the wider community in their home country these are community remittances we hypothesise that community sharing norm pressures are stronger in locations with more extensive home community networks we also postulate that the responsiveness of remittances to sharing pressures is subject to diminishing returns attributable to a donor fatigue effect using customised survey data from three polynesian migrant groups in metropolitan and regional australia we estimate double hurdle regression models of community remittances to identify the effects of sharing norm pressures we exploit an exogenous cyclone shock to home country incomes affecting one sub group we find strong evidence in support of the postulated responsiveness of community remittances to location related differences in sharing norm pressures and the presence of a donor fatigue effect the policy implicatio

testing for indeterminacy an application to u s monetary policy reply this paper considers a prototypical new keynesian model in which the equilibrium is undetermined if monetary policy is passive the likelihood based estimation of dynamic equilibrium models is extended to allow for indeterminacies and sunspot fluctuations we construct posterior weights for the determinacy and indeterminacy region of the parameter space and estimates for the propagation of fundamental and sunspot shocks according to the estimated model u s monetary policy post 1982 is consistent with determinacy whereas the pre volcker policy is not we find that before 1979 indeterminacy substantially altered the propagation of shocks

assimilation patterns in cities abstract do ethnic minority individuals assimilate to the majority s norm or reject it by trading off higher productivity and wages with a greater social distance to their culture of origin we develop a model in which oppositional ethnic minority individuals reside in more segregated areas have worse outcomes in terms of income but are not necessarily worse off in terms of welfare than assimilated ethnic minority individuals who live in less segregated areas a policy that reduces transportation cost decreases rather than increases assimilation in cities when there are more productivity spillovers between the two groups ethnic minority individuals are more likely not to assimilate and to reject the majority s norm finally we show that ethnic minority individuals tend to assimilate more in bigger and more expensive cities

monetary and fiscal policy interactions in the post war u s abstract a new keynesian model allowing for an active monetary and passive fiscal policy ampf regime and a passive monetary and active fiscal policy pmaf regime is estimated to fit various u s samples from 1955 to 2007 the results show that data in the pre volcker periods strongly prefer an ampf regime even with a prior centered in the pmaf region the estimation however is not very informative about whether the federal reserve s reaction to inflation is greater than one in the pre volcker period because much lower values can still preserve determinacy under passive fiscal policy in addition whether a pmaf regime can generate consumption growth following a government spending increase depends on the degree of price stickiness an income tax cut can yield an unusual negative labor response if monetary policy aggressively stabilizes output growth

a theory of remittances as an implicit family loan arrangement abstract the idea of an implicit and informal loan agreement between family members to explain migrants remittances is not new but its implications have not been fully explored in the theoretical literature many empirically testable propositions may be derived from this hypothesis when trying to explain why emigrants remit what the time profile of remittances is how it depends on the intent to stay on the expected length of stay and on interest rates what use people make of remittances and how the home family consumption behavior is affected by the economic prospects in the receiving country furthermore this theory yields many interesting policy prescriptions for less developed countries wishing to maximize the remittance flow from emigrants

remittances from international migration a review in perspective abstract remittances the portion of international migrant workers earnings sent back from the country of employment to the country of origin have come to play a central role in the economies of labor sending countries recent research has tended to focus on enumerating the costs and benefits of remittances this paper proposes an alternative perspective and delineates the remittances system as a heuristic to clarify intermediate relationships between determinants and effects of remittances using the heuristic as a framework for review of recent literature concerning remittances the paper identifies gaps in currently available research and argues for greater focus upon the social and political consequences of remittance flows

intermarriage and the economic assimilation of immigrants this article investigates the assimilation role of intermarriage between immigrants and natives intermarried immigrants earn significantly higher incomes than endogamously married immigrants even after we take account of human capital endowments and endogeneity of intermarriage the premium does not appear to be a reward for unobservable individual characteristics natives who intermarry do not receive this premium nor do immigrants who intermarry into another ethnic group the premium is mainly attributable to a faster speed of assimilation rather than any difference in labor market quality between intermarried and nonintermarried immigrants at the point of arrival

price indexation habit formation and the generalized taylor principle abstract we prove that the generalized taylor principle under which the nominal interest rate reacts more than one for one to a change in inflation in the long run is a necessary and under some extra mild restrictions on parameters sufficient condition for determinacy in a sticky price model with interest rate smoothing in monetary policy partial dynamic price indexation and habit formation in consumption

social security in a moral economy an empirical analysis for java private transfer payments are modeled as outcomes of a constrained social choice pro blem facing donors the approach is applied to a large household leve l data set for java and hypotheses are tested concerning the performa nce of the moral economy as a social security system transfer be havior is found to be very different between rural and urban areas w hile transfer receipts and outlays are income inequality reducing in rural areas this is not the case in urban areas there is also evidence of transfers being targeted to disadvantaged households such as the sick elderly and for urban areas the unemployed copyright 1988 by mit press

migrants remittances and financial development macro and micro level evidence of a perverse relationship financial development is commonly identified as an important condition for fostering investment and economic growth it is also believed that migrants remittances stimulate financial development in the receiving economy contributing indirectly to economic growth we explore the relationship between remittances and financial development using macro and micro level data from cross country panel data we find evidence of a negative relationship between remittances and financial deepening in developing countries using household survey data from a study of migrants remittances in two cis countries azerbaijan and kyrgyzstan we also investigate the relationship between remittances financial intermediation and financial literacy among remittance receiving households while we find some evidence of a positive albeit weak relationship for kyrgyzstan in azerbaijan the relatively more financially developed economy we uncover a strong perverse relationship remittances appear to deter bank intermediation and use of formal banking services possible reasons are explored and areas for further investigation identified

motivations to remit evidence from botswana in this article a theory of motivations to send remittances is described and tested with data from botswana altruism is one of the motivations tested and found to be an insufficient explanation for remittances among migrants in botswana a refinement of the model stipulates a modified altruism or enlightened self interest in this model the relationship between the migrant and family is tempered by an implicit understanding of mutual benefit the household strategy may be to encourage some members to migrate as a means of spreading risk and sharing gains the household strategy is similar to an insurance policy where migration is to places where market potential is high the risks incurred might be high the example is given of migration during a drought in botswana migrant remittances were greater in households with more cattle or households with more to lose drought alone was not statistically related to remittances increases in remittances were related to increased levels of education it is suggested that repayment was the motive for parents investment in migrants education migrants gains are identified as the potential for an inheritance the security of channeling investments through a trusted family member and security in having a home to return to it is pointed out that the altruism and family remittances from urban migration were strategies that bridged the simple dynamic of either urban development or rural development impacting on family welfare it is suggested that household models of economy adopt some measure to express the relationship of household wealth to remittances from urban migrants

endogenous peer effects local aggregate or local average a b s t r a c t we develop a unified model embedding different behavioral mechanisms of social interac tions and design a statistical model selection test to differentiate between them in empirical applications this framework is applied to study peer effects in education effort in study ing and sport activities for adolescents in the united states we find that for education students tend to conform to the social norm of their friends while for sport activities both the social multiplier and the social norm effect matter

job information networks neighborhood effects and inequality this paper explores the theoretical and empirical literature to examine the use by different social groups of informal sources of information provided by friends relatives and acquaintances during job search and its consequences for the job market it also addresses the role of network structure and size the resource endowments of contacts and nature of the links between contacts to explain differences in the effects of job information networks in doing so the paper also turns to the sociology literature on job information networks and provides an economic perspective on such sociological concepts as strong versus weak ties inbreeding distance from structural holes etc the paper distinguishes between models of exogenous job information networks that is where individuals obtain job related information through a given social structure and endogenous job information networks which are social networks that result from individuals uncoordinated actions the paper pays special attention to such issues as physical and social proximity and sharing of information and discusses them in the context of the recent social interactions and neighborhood effects literature finally the paper outlines a model that integrates job information networks where interactions occur in business cycle frequencies with the dynamics of human capital formation which include the joint effects of parental community and neighborhood human capital and are set in life cycle frequencies for the purpose of organizing suggestions for future research and examining earned income inequality

staying on in full time education reasons for higher participation rates among ethnic minority males and females individuals from ethnic minorities have a greater tendency to stay on in full time education beyond the compulsory age there are however wide variations between groups and the paper explores the role for human capital considerations such as earnings and increased employability in this choice economic considerations and socioeconomic background are found to be important but there is evidence for a separate ethnicity effect influencing choice the method used is to fit a joint leaving and employment equation for males and females aged 18 24 using combined micro data from the british labour force survey and the sample of anonymized records from the 1991 census

monetary fiscal policy interactions and fiscal stimulus abstract increases in government spending trigger substitution effects both inter and intra temporal and a wealth effect the ultimate impacts on the economy hinge on current and expected monetary and fiscal policy behavior studies that impose active monetary policy and passive fiscal policy typically find that government consumption crowds out private consumption higher future taxes create a strong negative wealth effect while the active monetary response increases the real interest rate this paper estimates markov switching policy rules for the united states and finds that monetary and fiscal policies fluctuate between active and passive behavior when the estimated joint policy process is imposed on a conventional new keynesian model government spending generates positive consumption multipliers in some policy regimes and in simulated data in which all policy regimes are realized the paper reports the model s predictions of the macroeconomic impacts of the american recovery and reinvestment act s implied path for government spending under alternative monetary fiscal policy combinations

controlling inflation with timid monetary fiscal regime changes can monetary policy control inflation when both monetary and fiscal policies change over time when monetary policy is active a long run fiscal principle entails flexibility in fiscal policy that preserves determinacy even when deviating from passive fiscal substantially for brief periods or timidly for prolonged periods in order to guarantee a unique equilibrium monetary and fiscal policies must coordinate not only within but also across regimes and not simply on being active or passive but also on their extent the amplitude of deviations from the active monetary passive fiscal benchmark determines whether a regime is ricardian timid deviations do not imply wealth effects

estimating remittance functions for pacific island migrants there is concern that pacific island economies dependent on remittances of migrants will endure foreign exchange shortages and declining living standards as remittance levels drop due to lower migration rates and the belief that migrants willingness to remit decreases over time the empirical validity of the remittance decay hypothesis has never been tested from survey data on tongan and western samoan migrants in sydney this paper estimates remittance functions using tobit regression analysis it is found that the remittance decay hypothesis has no empirical validity and migrants are motivated by factors other than altruistic family support including asset accumulation and investment back home c 1997 elsevier science ltd

a better job thanks to personal networks an evaluation for migrants who arrived in france before age 18 it is more difficult for migrants than natives to find a job in their host country so many of them have to accept at least temporarily a job that is below their level of qualification this repr

labor market adjustment in small open economies the case of micronesia abstract the paper uses the bertram poirine four sector framework to examine the labor market effects of a decline in external aid in a small open island economy it provides empirical evidence drawn from the federated states of micronesia to reject the notion that aid supported public expenditure crowds out opportunities for indigenous private sector development instead the paper argues that the future development of small island economies will depend on their access to overseas job markets and the continuation of aid inflows and remittances

the roles of destination gender and household composition in explaining remittances an analysis for the dominican sierra two non exclusive hypotheses about what motivates remittances sent by dominican migrants to their rural parents in the sierra are tested a an insurance contract taken by parents with their migrant children and b an investment by migrants in potential bequests results show that the relative importance of these two motives to remit is affected by destination us vs cities in the dominican republic gender and household composition the insurance function is mainly fulfilled by female migrants to the us only when a male is the sole migrant in his household does he play the role of insurer investment by contrast is pursued by both males and females but only among those migrating to the us d 2002 elsevier science b v all rights reserved

income transfers of chinese rural migrants some empirical evidence from jinan this paper explores the determinants of migrant remittances to rural households using data on male migrant workers drawn from the jinan municipality in shandong province in the summer of 1995 the majority of migrants are found to retain close links with their rural households with 85 remitting some income in the 12 months preceding the survey date the transfers accounted for over a third of urban labour earnings a number of models are used to undertake the estimation of remittance functions no evidence of altruistic behaviour is uncovered and evidence for exchange and coinsurance theories is mixed labour earnings proved the most robust determinant of the level of remittance and the remittance wage elasticity calculated is found to be at the top end of the range of estimates obtained in the literature

the distribution of public services an exploration of local governmental preferences a local governmental welfare function is specified to explore two of its central characteristics the equity productivity trade off and differential weights across neighborhoods the constrained maximization model is estimated using service outcomes safety in the welfare function as opposed to publicly provided inputs police over neighborhoods the equity productivity trade off is found to be considerable and not all neighborhoods are weighted equally the results show that inequality aversion and unequal concern by local government over service outcomes must be addressed explicitly to understand the observed distribution of publicly provided inputs with important implications for standard analysis of local governmental behavior copyright 1987 by american economic association

the theory of reform and indian indirect taxes abstract given a set of value judgements an initial state and a model of the economy one can ask whether some feasible tax change would increase welfare we do this by defining the marginal cost in terms of welfare of raising an extra rupee from the i th good the inverse optimum problem is the calculation of non negative welfare weights on households which imply that the initial state is optimum if no such welfare weights exist then a pareto improvement is possible we illustrate the concepts and results using data from the indian economy for 1979 1980 directions of tax reform for a number of specific social welfare functions and for pareto improvements are presented

remittances and vulnerability to poverty in rural mexico international remittances have been portrayed as the human face of globalization given their potential to alleviate poverty by directly increasing household income using a panel of rural households in mexico from october 1998 to november 2000 this study assesses whether this is in fact the case however rather than examining whether transfers income would reduce future consumption poverty we asked if transfers are likely to reach people whose conditions are prone to worsen in the future we used vulnerability to consumption poverty to quantify the extent to which risks and the more permanent disadvantages embedded in most rural livelihoods can translate into future declines in well being we found contrary to our expectations a negative and statistically significant relationship between the remittance of transfers including foreign remittances and the threat to future poverty that rural households could experience

backlash the unintended effects of language prohibition in u s schools after world war i do forced assimilation policies always succeed in integrating immigrant groups this article examines how a specific assimilation policy language restrictions in elementary school affects integration and identification with the host country later in life after world war i several u s states barred the german language from their schools affected individuals were less likely to volunteer in world war ii and more likely to marry within their ethnic group and to choose decidedly german names for their offspring rather than facilitating the assimilation of immigrant children the policy instigated a backlash heightening the sense of cultural identity among the minority

the impact of the london bombings on the well being of adolescent muslims we exploit the timing of the london bombings coinciding with a large scale national survey of adolescents to identify the impact of extremist islamic terror attacks on the well being of adolescent muslims our analysis reveals interesting gender differences we find evidence of a decline in the happiness of muslim teenage girls after the bombings which is also accompanied by a rise in expectations of facing discrimination in the labour market these findings are robust to several falsification tests on the other hand we fail to uncover compelling evidence of any impact of the bombings on muslim teenage boys

determinants of remittances the case of the south asian community in manchester this paper investigates the remittance behaviour of the south asian community using new data from indian pakistani and bangladeshi households in manchester the findings show that standard variables such as income employment education linkages to the home country and host country are important determinants of remittances although remittances are sent mainly for consumption purposes those sent for land acquisition and savings have stronger association with the amount of remittances in addition we find strong evidence for the remittance decay hypothesis for indian and pakistani migrants but not for bangladeshi migrants

as an economy becomes more developed do people become less altruistic abstractinter household private transfers are one of the main informal insurance mechanisms that prevalently implemented in developing countries unfortunately most of the literatures investigates

solving and estimating indeterminate dsge models we propose a method for solving and estimating linear rational expectations models that exhibit indeterminacy and we provide step by step guidelines for implementing this method in the matlab based packages dynare and gensys our method redefines a subset of expectational errors as new fundamentals this redefinition allows us to treat indeterminate models as determinate and to apply standard solution algorithms we prove that our method is equivalent to the solution method proposed by lubik and schorfheide 2003 2004 and using the new keynesian model described in lubik and schorfheide 2004 we demonstrate how to apply our theoretical results with a practical exercise

ethnic enclaves and the economic success of immigrants evidence from a natural experiment recent immigrants tend to locate in ethnic enclaves within metropolitan areas the economic consequence of living in such enclaves is still an unresolved issue we use an immigrant policy initiative in sweden when government authorities distributed refugee immigrants across locales in a way that may be considered exogenous this policy initiative provides a unique natural experiment which allows us to estimate the causal effect on labor market outcomes of living in enclaves we find substantive evidence of sorting across locations when sorting is taken into account living in enclaves improves labor market outcomes for instance the earnings gain associated with a standard deviation increase in ethnic concentration is in the order of four to five percent

economics and identity this paper considers how identity a person s sense of self affects economic outcomes we incorporate the psychology and sociology of identity into an economic model of behavior in the utility function we propose identity is associated with different social categories and how people in these categories should behave we then construct a simple game theoretic model showing how identity can affect individual interactions the paper adapts these models to gender discrimination in the workplace the economics of poverty and social exclusion and the household division of labor in each case the inclusion of identity substantively changes conclusions of previous economic analysis

you can t take it with you immigrant assimilation and the portability of human capital the national origin of an individual s human capital is a crucial determinant of its value education and labor market experience acquired abroad are significantly less valued than human capital obtained domestically this difference can fully explain the earnings disadvantage of immigrants relative to comparable natives in israel variation in the return to foreign schooling across origin countries may reflect differences in its quality and compatibility with the host labor market the return to foreign experience is generally insignificant acquiring additional education following immigration appears to confer a compound benefit by raising the return to education acquired abroad

remittances and portfolio values an inquiry using immigrants from africa europe and the americas summary using a recent spanish database we show that remittances respond to cross country differences in portfolio values behavior consistent with immigrant s access to trans national networks responsiveness to portfolio variables is found to persist regardless of education level there are however differences in the portfolio variables to which immigrants respond as we would expect given migrants diverse backgrounds region of origin and motive for emigrating remitting patterns are found to change with the length of migration spells suggestive that remittances sent for portfolio motives become more likely as the immediate needs of home family are addressed and asset accumulation becomes more important

a language theory of discrimination any advanced industrial society is composed of a number of speech communities with different verbal and nonverbal languages in particular in the united states blacks and whites and men and women have sharply differing methods of speaking and listening this paper develops a model in which people can only work together if they speak the same language and in which it is costly to learn a second language the competitive market will tend to minimize communication through segregation but if interaction is required the cost will be borne by the minority a number of nontrivial predictions are derived from the model

spatial mismatch transport mode and search decisions in england abstract we develop a theoretical model in which whites mainly use private vehicles to commute whereas nonwhites use public transportation we show that for both whites and nonwhites higher time distance to jobs leads to lower search effort because of different transport modes we also show that at exactly the same time distance to jobs white unemployed workers search more intensively than nonwhites because it is less costly for them to gather information about jobs we then test this model using english sub regional data we find that for each race indeed living in areas where distance to jobs is higher yields the unemployed to search less than in areas with better job access we also find that having access to a car increases search intensity for both whites and nonwhites finally closing the racial gap in car access and distance to jobs would considerably narrow the difference in search intensities between whites and nonwhites

introduction to the economics of religion after a very long hiatus economists have begun again to study the relationship between economics and religion this article seeks to summarize and evaluate the principal themes and empirical findings that have appeared in some 200 recent papers on the economics of religion although some of the research concerns the economic consequences of religiosity most applies standard economic theory to the study of individual religious activity the characteristics of religious groups and the impact of regulation and competition on religious markets

formation and persistence of oppositional identities we develop a dynamic model of identity formation that explains why ethnic minorities may choose to adopt oppositional identities i e some individuals may reject or not the dominant culture and why this behavior may persist over time we first show that the prevalence of an oppositional culture in the minority group cannot always be sustained in equilibrium indeed because the size of the majority group is larger there is an imposed process of exposition to role models from the majority group that favors the diffusion of mainstream values in the minority community in spite of this an oppositional culture in the minority group can nevertheless be sustained in steady state if there is enough cultural segmentation in terms of role models or if the size of the minority group is large enough or if the degree of oppositional identity it implies is high enough we also demonstrate that the higher the level of harassment and the number of racist individuals in the society the more likely an oppositional minority culture will emerge we finally show that ethnic identity and socialization effort can be more intense in mixed rather than segregated neighborhoods 2011 elsevier b v all rights reserved

policy regimes policy shifts and u s business cycles abstract using an estimated dsge model with monetary and fiscal policy interactions and allowing for equilibrium indeterminacy we find that a passive monetary and passive fiscal policy regime prevailed in the pre volcker period this gave rise to self fulfilling beliefs and unconventional transmission mechanisms of policy shifts unanticipated increases in interest rates increased inflation and output while unanticipated increases in lump sum taxes decreased inflation and output we show that had the monetary policy regime of the post volcker era been in place pre volcker inflation volatility would have been lower by 25 and the rise of inflation in the 1970s would not have occurred

sustainable development in pacific micro economies abstract this paper argues that the central economic problem for a number of very small pacific island economies is the preservation and enhancement of their status as rentier societies and the relatively high living standards vis a vis other developing countries which go with the status the thrust of most development planning in the region with its focus on sustainable expansion of productive activity is misdirected in these small countries it is not productive activity but rent entitlements which must be sustained and reproduced over time aid philately and migrant remittances are not merely supplements to local incomes they are the foundations of the modern economy insofar as conventional development projects crowd out aid and remittance entitlements their impact is immiserizing criticism is offered of a recent argument for returning to sustainable subsistence economies

the economics of immigration this literature review concerns the impact of immigration on the economy of the host country focusing on the experience of the united states the emphasis is on the period from the 1970s to the 1990s the author shows that research earlier in this period generally concluded that the economic effects of immigration were positive but that more recent research on later migrations have generally concluded that immigration may be having an adverse effect on the earnings of native unskilled workers and be placing an increased burden on welfare programs the importance of such economic analysis for the formulation of appropriate migration policies is stressed

don t tell on me experimental evidence of asymmetric information in transnational households although most theoretical models of household decision making assume perfect information empirical studies suggest that information asymmetries can have large impacts on resource allocation i demonstrate the importance of these asymmetries in transnational households where physical distance between family members can make information barriers especially acute i implement an experiment among migrants in washington dc and their families in el salvador that examines how information asymmetries can have strategic and inadvertent impacts on remittance decisions migrants make an incentivized decision over how much of a cash windfall to remit and recipients decide how they will spend a remittance migrants strategically send home less when their choice is not revealed to recipients recipients make spending choices closer to migrants preferences when the migrants preferences are shared regardless of whether or not the spending choices are revealed to the migrants suggesting that recipients choices are inadvertently affected by imperfect information

the effects of social networks on employment and inequality we develop a model where agents obtain information about job opportunities through an explicitly modeled network of social contacts we show that employment is positively correlated across time and agents moreover unemployment exhibits duration dependence the probability of obtaining a job decreases in the length of time that an agent has been unemployed finally we examine inequality between two groups if staying in the labor market is costly and one group starts with a worse employment status then that group s drop out rate will be higher and their employment prospects will be persistently below that of the other group

identity and schooling some lessons for the economics of education abstract this review culls noneconomic literature on education by sociologists anthropologists and practitioners to present a new economic theory of students and schools this theory elaborates two themes that have eluded economic analysis first is the student as decision maker whose primary motivation is her identity second is a conception of the school as a social institution this framework suggests a new perspective on questions such as resource allocation and school reform it explains why some educational policies succeed and others fail we show how sociological variables may affect outcomes and suggest ways economists can incorporate them into theoretical and empirical research

long term debt and optimal policy in the fiscal theory of the price level the fiscal theory says that the price level is determined by the ratio of nominal debt to the present value of real primary surpluses i analyze long term debt and optimal policy in the fiscal theory i find that the maturity structure of the debt matters for example it determines whether news of future deficits implies current inflation or future inflation when long term debt is present the government can trade current inflation for future inflation by debt operations this tradeoff is not present if the government rolls over short term debt the maturity structure of outstanding debt acts as a budget constraint determining which periods price levels the government can affect by debt variation alone in addition debt policythe expected pattern of future state contingent debt sales repurchases and redemptionsmatters crucially for the effects of a debt operation i solve for optimal debt policies to minimize the variance of inflation i find cases in which long term debt helps to stabilize inflation i also find that the optimal policy produces time series that are similar to u s surplus and debt time series to understand the data i must assume that debt policy offsets the inflationary impact of cyclical surplus shocks rather than causing price level disturbances by policy induced shocks shifting the objective from price level variance to inflation variance the optimal policy produces much less volatile inflation at the cost of a unit root in the price level this is consistent with the stabilization of u s inflation after the gold standard was abandoned

were there regime switches in u s monetary policy working paper 2004 14 june 2004 abstract a multivariate model identifying monetary policy and allowing for simultaneity and regime switching in coefficients and variances is confronted with u s data since 1959 the best fit is with a model that allows time variation in structural disturbance variances only among models that also allow for changes in equation coefficients the best fit is for a model that allows coefficients to change only in the monetary policy rule that model allows switching among three main regimes and one rarely and briefly occurring regime the three main regimes correspond roughly to periods when most observers believe that monetary policy actually differed and the differences in policy behavior are substantively interesting though statistically ill determined the estimates imply monetary targeting was central in the early 80s but was also important sporadically in the 70s the changes in regime were essential neither to the rise in inflation in the 70s nor to its decline in the 80s jel classification e52 e47 c53 key words counterfactuals lucas critique policy rule monetary targeting simultaneity volatility model comparison i the debate over monetary policy change in an influential paper clarida gali and gertler 2000 cgg presented evidence that us monetary policy changed between the 1970 s and the 1980 s indeed that in the 70 s it was drastically worse they found that the policy rule apparently followed in the 70 s was one that when embedded in most stochastic general equilibrium models would imply non uniqueness of the equilibrium and hence vulnerability of the economy to sunspot fluctuations of arbitrarily large size their estimated policy rule for the later period on the other hand eliminated this indeterminacy these results are a possible explanation of the volatile and rising inflation of the 70 s and of its subsequent decline the cgg analysis has two important weaknesses one is that it fails to account for stochastic volatility us macroeconomic variables and particularly the federal funds rate have gone through periods of tranquility and of agitation with forecast error variances varying greatly from period to period ignoring such variation does not lead to inconsistent estimates of model parameters when the forecasting equations themselves are constant but it strongly biases toward a finding of changed parameters tests of the stability of the forecasting equations the other weakness is that the cgg analysis rests on powerful and implausible identifying assumptions they require that we accept that the response of the monetary authority to expected future inflation and output does not depend on the recent history of inflation money growth or output it is hard to understand why this should be so especially in the 70 s when monetarism was a prominent theme in policy debates congress was requiring reports from the fed of projected time paths of monetary aggregates and financial markets were reacting sensitively to weekly money supply numbers the requirement for existence and uniqueness of equilibrium in dynamic models is that the monetary policy rule show a more than unit response of interest rates to the sum of the logs of all nominal variables that appear on the right hand side of the reaction function if we force a particular measure of expected future inflation to proxy for all the nominal variables that actually appear independently in the reaction function we are bound to get distorted conclusions on the one hand because expected future inflation will be a noisy measure of the full set of nominal influences on policy we might get downward bias in our estimates from the usual errorsin variables effect on the other hand to the extent that expected future inflation like most expected future values shows less variation than current nominal variables we could find a mistaken scaling up of coefficients

inflation dynamics the role of public debt and policy regimes abstract in a passive monetary and active fiscal policy regime changes in the value of public debt generate wealth effects on households then in contrast to the active monetary and passive fiscal policy regime inflation moves oppositely from the inflation target and a stronger reaction of interest rates to inflation increases the response of inflation to shocks moreover a higher level of public debt increases the response of inflation while a weaker reaction of taxes to debt decreases the response of inflation to shocks in a passive monetary and passive fiscal policy regime both monetary and fiscal policy parameters affect inflation

endogeneity and sample selection in a model for remittances abstract we estimate a remittance model in which we address endogeneity and reverse causality relationships between immigrants remittances pre transfer income and consumption in order to take into account the fact that a large share of individuals do not remit instrumental variable variants of the double hurdle and heckit selection models are proposed and estimated by limited information ml semiparametric extensions are considered as robustness checks our results for a sample of recent immigrants to australia show that endogeneity is substantial and that estimates obtained by the methods previously employed in the literature may be misleading if given a behavioral interpretation

migrants intentions to return home and capital transfers a study of tongans and samoans in australia this article examines the attributes of migrants from the pacific island states of tonga and samoa living in australia to assess the extent to which return migrants could contribute to the human and physical capital stock of the migrant sending countries it also examines the impact of intention to return on remittances and asset accumulation the study finds that very few migrants plan to return home and very little evidence that those who plan to return embody significant human capital education experience and skills intention to return may be important nevertheless since those who plan to return remit significantly more than those that do not and also accumulate far more physical capital at home than those that do not intend to return

ethnic variation in commuting propensity and unemployment spells some u k evidence abstract this paper uses 1987 88 u k survey data from the unemployment inflow to investigate the ability of ethnic variation in commuting willingness to account for longer non white unemployment spells the study is motivated by the possibility that ethnic minorities are at greater risk of spatial mismatch unemployment because they are more geographically restrictive in their job seeking activities our findings support this hypothesis and indicate that lower commuting willingness explains about 20 of the differential between the average unemployment spells of ethnic minorities and whites

city structure job search and labour discrimination theory and policy implications we consider a search matching model in which black workers are discriminated against and the job arrival rates of all workers depend on social networks as well as distance to jobs location choices are driven by the racial preferences of households both blacks and whites consciously choosing to trade off proximity to neighbors of similar racial backgrounds for proximity to jobs because of coordination failures in the location choices multiple urban equilibria emerge there is a spatial mismatch equilibrium in which blacks reside far away from jobs and experience high unemployment rates and a spatial match equilibrium in which blacks are closer to jobs and experience lower unemployment rates under some reasonable condition we demonstrate that all workers are better off in the spatial match equilibrium we then consider two policies affirmative action and employment subsidies to the firms which hire black workers we show that the optimal policy requires imposing larger quotas or subsidies in cities in which black workers reside far away from jobs than in cities in which they live closer to jobs

social norms and gift behavior theory and evidence from romania in many developing and transitional countries with limited public income redistribution inter household transfers in general and gifts in particular are sizable and very important we use unique romanian survey data that enables us to isolate pure gifts from other private transfers we explicitly focus on the importance of community wide social norms and find that they indeed play a major role for both the occurrence and the values of gifts more exactly our results suggest that the overall predominant gift motive among romanian households is a norm of reciprocity moreover this norm seems to be dominating for gifts to middle and high income households even though poor households receive to the same extent norms of both impure altruism and reciprocity tend to be important hence although the poor may not reciprocate gifts to the same extent as the rich they still receive since there is a social norm to give especially to the poor

networks in the modern economy mexican migrants in the u s labor market this paper attempts to identify job networks among mexican migrants in the u s labor market the empirical analysis uses data on migration patterns and labor market outcomes based on a sample of individuals belonging to multiple origin communities in mexico over a long period of time each community s network is measured by the proportion of the sampled individuals who are located at the destination the united states in any year we verify that the same individual is more likely to be employed and to hold a higher paying nonagricultural job when his network is exogenously larger by including individual fixed effects in the employment and occupation regressions and by using rainfall in the origin community as an instrument for the size of the network at the destination

are remittances insurance evidence from rainfall shocks in the philippines several facts motivate this study first life in developing countries is prone to many kinds of risk such as crop and income loss due to natural disasters weather insect infestations and fire and civil conflict second international migration and remittance flows are substantial and growing between 1965 and 2000 individuals living outside their country of birth grew from 2 2 to 2 9 percent of the world population totaling 175 million people in 2000 the remittances that these migrants send to their countries of origin are an important but poorly understood type of international financial flow this article examines a mechanism for coping with shocks ex post on which previous micro level studies have not focused remittances from family members overseas at the international level it is commonly posited that remittance flows from overseas buffer economic shocks in migrants home countries but there have been relatively few empirical tests of this claim with micro level household data related research on the role of domestic migration in pooling risk within extended families includes lucas and stark 1985 rosenzweig and stark 1989 and paulson 2000

remittance income volatility and labor supply in mexico author affiliation catalina amuedo dorantes camuedod mail sdsu edu corresponding authorsusan pozo susan pozo wmich edu acknowledgment we would like to thank the anonymous referees and the editor for their comments and suggestions on how to improve the manuscript 1 background and significancea significant body of academic and policy research analyzes the impact of international remittances the earnings that emigrants send home in economies around the globe studies have been carried out to ascertain the effect of remittances on a wide range of economic outcomes including household decisions concerning capital accumulation health and housing expenditures country exchange rates economic growth income distribution poverty rates and as we do in this study labor supply evidence of the impacts of remittances on the well being of recipients and on economic progress is mixed some studies find that countries and households reap positive benefits from these resource transfers e g adam and page 2005 while others find negative or ambiguous effects e g narayan narayan and mishra 2011 an overall consensus on the impacts of remittances is unlikely to emerge for some time given the complexity of this research topic not to mention the varying characteristics of countries under analysis 1we propose to contribute to this important debate using an expanded approach for assessing the effects of remittances on individual and household decision making our contribution is to note that while the level of resource transfers received by the household is likely to influence individual and household behaviors volatility with regard to the stream of inflows is also likely to play an important role to date research on the impact of remittances on remittance receiving households has tended to focus on the way in which the level of remittance inflows affects either individual or household behavior without considering the volatility surrounding these inflows however if the volatility that surrounds remittance inflows influences individual and household behaviors a strategy that only examines the level of inflows is likely to miss out on a more complete understanding of the effects of remittances on individual and household decision making and therefore of their impacts on remittance receiving economies amuedo dorantes and pozo 2010 in this study we focus on the labor market and investigate how volatility of remittance inflows influences male and female labor supply a crucial dimension in the influence of remittances on remittance receiving countries limited numbers of studies have examined the impact of the incidence and level of remittance income on labor supply patterns although conclusions differ owing in part to the various data sources and methodological approaches being used a majority of the studies have concluded that the receipt of remittances results in labor supply reductions for instance rodriguez and tiongson 2001 report that remittances lower employment in the philippines while funkhouser 1992 estimates that remittances reduce the employment likelihood of nicaraguan men and women by 2 and 5 percentage points respectively studies by amuedo dorantes and pozo 2006 and hanson 2007 found that the impact of remittances on the labor supply of mexicans is conditioned on gender they conclude that mexican women reduce labor supply on account of remittance inflows whereas men do not in contrast limiting their study to mexican households that receive persistent remittances cox edwards and rodriguez oreggia 2009 conclude that remittances have no impact on the labor supply of household members remaining in mexico with the exception of urban women in traditionally low migration states for whom labor supply rises however we still lack an understanding of the ways in which the volatility in remittance inflows can impact labor supply in remittance receiving countries

an exogeneity test for a simultaneous equation tobit model with an application to labor supply a test of weak exogeneity in the simultaneous equation tobit model is proposed and illustrated using a female labour supply model estimated using cross section data the test statistic can be simply output from any standard tobit maximum likelihood package and is asymptotically efficient the procedure provides consistent estimators for the simultaneous tobit model whose asymptotic covariance matrix is a simple extension of the usual tobit formula we also provide the lagrange multiplier test of weak exogeneity this abstract was borrowed from another version of this item

remitting behaviour of turkish migrants evidence from household data in germany this paper provides an empirical analysis of the remittances of turkish migrants using novel data from 589 households in berlin which holds the largest turkish community outside turkey the findings suggest that the remittances of turkish migrants are determined mainly by a combination of self interest and tempered altruism comparison of migrant groups who do and do not intend to return to turkey shows that those intending to return remit mostly for self interest and remit larger amounts while those with no such intention remit mainly due to implicit loan agreement within the family there is no evidence of pure altruism in any of the samples in addition remitters are more likely to increase the amount of remittances where they are to be spent on education and investment the same relationship does not hold for basic needs

diaspora growth and aggregate remittances an inverted u relationship this paper presents a model in which remittances stem from a decision made jointly by a family coalition of multiple migrants and non migrants allowing two alternative interpretations migrants a

drivers and dynamics of internal and international remittances this article analyses whether and how intra household remittance volumes vary with the length of a migrant s absence and whether the drivers and dynamics of remittance decay depend on the migrant s destination we address these questions by using data from the 64th round of the indian national sample survey conducted between july 2007 and june 2008 we find that the average intra household remittance function follows a curvilinear trajectory that is best approximated by a quartic m shaped specification the volatility of intra household remittances is distinct across migration destinations with international remittance flows being more volatile than internal intra state or inter state flows