persistence of initial debt in the long term employment dynamics of new firms this paper investigates whether a firm s future growth is independent of its initial debt structure the non parametric test consists of determining whether the conditional size distribution for firms surviving through early years of life depends upon debt to asset ratio at birth initially i test for initial size dependence in the growth process by applying pakes and ericson 1998 procedure i then test the hypothesis that initial debt to asset ratios are irrelevant to growth of ten year old manufacturing firms i reject the null of independence and find evidence of a non monotonic relationship between age ten conditional size and the initial debt to asset ratio ce texte examine la question a savoir si la croissance future d une firme depend de la structure initiale de sa dette le test non parametrique consiste a determine si la distribution conditionnelle de la taille des firmes qui survivent au cours des premieres annees depend du ratio dette actif a la naissance l auteur teste d abord l independance de la taille initiale et du processus de croissance a l aide de la procedure de pakes et ericson 1998 et ensuite l hypothese que le ratio initial dette actif n est pas pertinent pour expliquer la croissance de firmes manufacturieres qui ont survecu dix ans l hypothese nulle d independance est rejetee et on trouve trace d une relation non monotone entre la taille conditionnelle a dix ans et le ratio initial de la dette sur l actif

moral hazard in lending and labor market volatility when the economy experiences a sharp economic downturn credit spreads widen and project financing costs for firms rise as funding sources begin to dry up the economy experiences a lengthy recovery with unemployment rates slow to return to full employment levels we develop a model that displays these features it relies on an interaction between labor search frictions and firm level moral hazard that is accentuated during recessions the model is capable of addressing the shimer puzzle with labor market variables exhibiting significantly more volatility on average as a result of the heightened moral hazard concerns during these episodes that significantly deepen and prolong periods of high unemployment as vacancy postings fall dramatically and the job finding rate declines our mechanism is also found to induce internal shock propagation causing the peak response of output unemployment and wages to occur with a several quarter delay relative to a model without such frictions many other labor market variables also show slower recovery their return to preshock level occurs at a slower pace for a number of periods after the peak response

the growth potential of startups over the business cycle this paper shows that employment in cohorts of us firms is strongly influenced by aggregate conditions at the time of their entry employment fluctuations of startups are procyclical they persist into later years and cohort level employment variations are largely driven by differences in firm size rather than the number of firms an estimated general equilibrium firm dynamics model reveals that aggregate conditions at birth rather than post entry choices drive the majority of cohort level employment variation by affecting the share of startups with high growth potential in the aggregate changes in startup conditions result in large slow moving fluctuations in employment

net job creation in the us economy lessons from monthly data 1950 2011 this article studies the monthly net job creation njc at the aggregate and the sectoral levels in the united states over the period 1950 to 2011 the article has few important findings first njc did not show a significant trend over the last six decades which led to a fall in the njc rate second njc was very volatile and it could change course even in the span of 1 month third there was no clear pattern about the co movement between njc and the change in the unemployment rate fourth the averages of total njc and private njc since late 2010 were significantly higher than their respective historical averages and the volatility in njc since the end of the great recession was not unusual by historical standards fifth while the evidence about the effects of the 2009 american recovery and reinvestment act on employment is inconclusive some sectors appeared to benefit from it finally the most frequent drop in the unemployment rate was by 0 1 and drops of more than 0 2 should not be highly expe

accounting for central neighborhood change 1980 2010 abstract after 1980 2000 population decline and economic stagnation downtown neighborhoods in most large us cities experienced 2000 2010 population growth and gentrification stark racial differences in valuations of downtown amenities and suburban labor market opportunities among those with less than college that only emerged after 2000 are the primary drivers of these downtown neighborhood dynamics as college educated whites moved in increases in valuations of downtown amenities encouraged other whites to remain in downtowns a reversal from prior decades continued departures of less than college educated minorities were driven both by relative improvements in suburban employment opportunities for this group and their continued declines in valuations of downtown amenities our evidence highlights the importance of racial differences in valuations of potentially endogenous local amenities for understanding recent downtown gentrification

stochastic security for operations planning with significant wind power generation in their attempt to cut down on greenhouse gas emissions from electricity generation several countries are committed to install wind power generation up to and beyond the 10 20 penetration mark however the large scale integration of wind power represents a challenge for power system operations planning because wind power 1 cannot be dispatched in the classical sense and 2 its output varies as weather conditions change this warrants the investigation of alternative short term power system operations planning methods capable of better coping with the nature of wind generation while maintaining or even improving the current reliability and economic performance of power systems to this end this paper formulates a short term forward electricity market clearing problem with stochastic security capable of accounting for nondispatchable and variable wind power generation sources the principal benefit of this stochastic operation planning approach is that when compared to a deterministic worst case scenario planning philosophy it allows greater wind power penetration without sacrificing security

who creates jobs econometric modeling and evidence for austrian firm level data abstract this paper provides evidence on the role of firm size and firm age for firm level net job creation in the austrian economy between 1993 and 2013 and during the great recession we propose a new estimation strategy based on a two part model to decompose behavioral differences between exiting and surviving firms young firms contribute most to net job creation despite high relative exit rates due to high growth rates among young surviving firms small firms have similar job creation rates conditional on survival as large firms small firms contribution to job creation is however smaller due to higher exit rates the up or out dynamics characterizing less regulated economies such as the us also apply to the more regulated austrian economy during the great recession both the relative net job creation rate conditional on survival and the relative survival probability of young firms decreased the relative contribution of small firms to net job creation by contrast increased due to increased relative job creation rates of small firms conditional on survival

estimating ethnic preferences using ethnic housing quotas in singapore there are many policies around the world aimed at integrating groups gender ethnic national in education employment immigration and housing in the case of housing since prices may not internalize externalities in residential location choices we need to know preferences for welfare analysis this paper estimates people s taste for living with own ethnic groups ethnic preferences using unique policy variation from the ethnic housing quotas in singapore my approach combines policy induced variation commonly used in reduced form settings with a non parametric identi cation strategy in a structural demand estimation framework a la berry levinsohn and pakes 1995 i nd that all groups have strong preferences to live with at least some other

profit sharing credit market imperfections and equilibrium unemployment we investigate the interaction between labour and credit market imperfections for equilibrium unemployment in the presence of profit sharing in a partial equilibrium with exogenous outside options increased bargaining power of banks has adverse employment effects in a general equilibrium with endogenous outside options this relationship is frequently reversed reduced credit market imperfections increase equilibrium unemployment if the labour market imperfections measured by the bargaining power of trade unions are sufficiently strong and the benefit replacement ratio is sufficiently high finally we show that higher bankruptcy risks increase equilibrium unemployment under similar conditions

separations sorting and cyclical unemployment abstract this paper establishes a new fact about the compositional changes in the pool of unemployed over the us business cycle using microdata from the current population survey for the years 1962 2012 it documents that in recessions the pool of unemployed shifts toward workers with high wages in their previous job and that these shifts are driven by the high cyclicality of separations for high wage workers the paper finds that standard theories of wage setting and unemployment have difficulty in explaining these patterns and evaluates a number of alternative theories that do better in accounting for the new fact jel e24 e32 j31 j63 j64

revisiting the behavior of small and large firms during the 2008 financial crisis abstract gertler and gilchrist 1994 provide seminal evidence for the prevailing view that adverse shocks are propagated via credit constraints small firms are affected more during tight credit periods than large firms under this view the deep recession that followed the 2008 financial crisis is often interpreted as the propagation of the initial credit shock following gertler and gilchrist 1994 s methodology we study the behavior of small and large firms during episodes of credit disruption and extend the analysis to the 2008 financial crisis and nber dated recessions we find that large firms short term debt and sales contracted relatively more than those of small firms during the 2008 financial crisis and during most recessions since 1969 the results are robust to changes in the business cycle dating procedure using compustat we also find that during 2007 09 low financially dependent firms suffered more than high financially dependent firms these results favor the view that a tightening of a financial or collateral constraint might not be a good representation of the 2007 09 crisis

employment effects of financial constraints during the great recession abstract employment declined substantially during the 2007 2009 recession especially in small and young firms using confidential firm level data of the universe of firms and a difference in differences methodology this paper estimates that financial constraints reduced employment growth by 4 to 8 percentage points in small firms relative to large firms and by 7 to 9 percentage points in young relative to old firms i find that the effect of financial constraints on small firms is driven to a large extent by young firms i then document that financial constraints affected employment growth in small and young firms strongly through the entry and exit of firms

housing choice hindrances and urban spatial structure evidence from matched location and location preference data in chinese cities abstract in a monocentric city with a well functioning residential market pareto efficient spatial equilibrium entails the sorting of residents according to their bid rent gradient in descending order away from city center violation of this sorting condition creates opportunities for pareto improving trading of locations and can be sustained only if the market is hindered we propose a simple ordered location choice model using matched location and location preference data of individual households to examine violations of the pareto efficient spatial sorting condition in so doing we are able to identify population groups facing housing choice hindrances we find in a sample of chinese cities undergoing housing market liberalization that poor marketability of the previously state provided homes inadequate provision of housing finance and spatial mismatch between job market and housing market opportunities contribute to a pareto inefficient spatial structure

did the job ladder fail after the great recession we study employment reallocation across employers through the lens ofa dynamic job ladder model workers always agree on a ranking ofemployers at all points in time and search for better jobs both offand on the job a parsimonious version of the model fits well the timeseries of gross worker flows by employer size from newly available usdata from the job openings and labor turnover survey focusing on the us experience in and around the great recession our evidence indicates that the job ladder stopped working then and has not fully resumed yet

large firm dynamics and the business cycle do large firm dynamics drive the business cycle we answer this question by developing a quantitative theory of aggregate fluctuations caused by firm level disturbances alone we show that a standard heterogeneous firm dynamics setup already contains in it a theory of the business cycle without appealing to aggregate shocks we offer an analytical characterization of the law of motion of the aggregate state in this class of models the firm size distribution and show that aggregate output and productivity dynamics display i persistence ii volatility and iii time varying second moments we explore the key role of moments of the firm size distribution and in particular the role of large firm dynamics in shaping aggregate fluctuations theoretically quantitatively and in the data

riskiness endogenous productivity dispersion and business cycles abstract in the data cross sectional productivity dispersion is countercyclical at both the plant level and the firm level see e g bloom 2009 i incorporate a firm s choice of risk level into a model of firm dynamics with real business cycle features to explain this empirical finding both qualitatively and quantitatively in the model in every period each firm chooses the investment amount and the risk level associated with a production project every period all projects available to each firm have the same expected flow return determined by the aggregate and idiosyncratic shocks to the firm s productivity and differ from one another only in their risk the endogenous option of exiting the market and the limited funding for new investment jointly play an important role in motivating firms risk taking behavior the model predicts that in each period relatively small firms are more likely to take risk and hence exhibit a higher exit rate and that the cross sectional productivity dispersion measured as the standard deviation of the realized individual component of productivity is larger in recessions

unemployment and small cap returns the nexus in other work moscarini and postel vinay 2008 2009a we find a distinct cyclical pattern of the relative performance of large and small businesses in terms of net job creation large employers destroy proportionally more jobs during and right after recessions and create proportionally more jobs late in expansions relative to small employers differential size growth between small and large firms is strongly positively correlated with the unemployment rate this pattern is observer both in a 1978 2005 census of u s employers the business dynamics statistics and among listed companies in compustat in this paper we show that this cyclical pattern of relative performance is also reflected in stock returns specifically we show that the difference in returns between benchmark portfolios of small cap stocks and portfolios of large cap stocks is also positively correlated with the unemployment rate financial consultants and fund managers commonly recommend investing in small cap stocks during business cycle recoveries our findings while consistent with that advice pertain to all phases of the business cycle we propose an explanation of both facts based on dynamic competition between employers of different sizes and different productivities the model is a stochastic dynamic version of the job search and wage posting model of kenneth burdett and dale t mortensen 1998 which we analyze in detail in moscarini and postel vinay 2009b it is a job ladder model where smaller firms are smaller because they are less productive offer lower wages therefore are less attractive to workers and less successful in poaching workers out of competing firms this lack of competitiveness on the labor market is more of a drawback

grown up business cycles the entry rate of u s employer businesses has declined for more than 30 years we use a novel dynamic decomposition framework to show that regardless of its causes the direct effects of the continued decline in the entry rate and its delayed effects on the firm age distribution together play a major role in the slowing of trend employment growth and the emergence of jobless recoveries we identify changing demographic structure of the population and increased import competition as leading factors behind the decline in startup activity received september 1 2015 editorial decision april 5 2018 by editor francesca cornelli authors have furnished an internet appendix which is available on the oxford university press web site next to the link to the final published paper online

housing demand and community choice an empirical analysis abstract housing demand reflects the household s simultaneous choice of the neighborhood whether to own or rent the dwelling and the quantity of housing services demanded existing literature emphasizes the final two factors but overlooks the choice of community this paper develops an econometric model that incorporates all three components and then estimates this model using a sample of tampa florida households incorporating community choice increases the price elasticity of demand and reduces the differential between white and comparable nonwhite households the results are robust to the inclusion of permanent income and taxes

credit rationing race and the mortgage market abstract this study applies microdata from the 1983 survey of consumer finances to evaluate the effects of borrower race and default risk in mortgage lending the empirical analysis is based on a probit model of whether borrowers obtain fha or conventional mortgages the former are fully insured and are characterized by easier downpayment constraints but are typically more expensive hence households borrowing through the fha will tend to be credit constrained in the conventional market results of the analysis indicate that variables which proxy lender concerns about default risk and cost have an important effect on the type of loan borrowers obtain empirical estimates also suggest that minority households are significantly less likely to obtain conventional financing than whites even after controlling for various proxies of default risk these results suggest that race effects in mortgage lending may persist for reasons unrelated to borrower default risk

the effectiveness of hiring credits this article analyses the effectiveness of hiring credits using comprehensive administrative data we show that the french hiring credit implemented during the great recession had significant positive employment effects and no effects on wages relying on the quasi experimental variation in labour cost triggered by the hiring credit we estimate a structural search and matching model simulations of counterfactual policies show that the effectiveness of the hiring credit relied to a large extent on three features it was non anticipated temporary and targeted at jobs with rigid wages we estimate that the cost per job created by permanent hiring credits either countercyclical or time invariant in an environment with flexible wages would have been much higher

taxes and growth in a financially underdeveloped country evidence from the chilean investment boom this paper argues that taxation of retained profits is particularly distortionary in an economy with good growth prospects and poorly developed financial markets because it primarily reduces the investment of financially constrained firms investment that has marginal product greater than the after tax market real interest rate contrarily taxes on distributed profits or capital gains primarily reduce the investment of financially unconstrained firms chile experienced a banking crisis over the period from 1982 to 1986 and in 1984 reduced its tax rate on retained profits from 50 percent to 10 percent we show that consistent with our theory there was a large increase in aggregate investment after the reform which was entirely funded by an increase in retained profits further we show that investment grew by more in industries that depend more on external financing according to the rajan and zingales 1998 measure finally we present some weak evidence from comparisons of investment rates across firms for several different measures of their likelihood of being financially constrained

the determinants of firms performance can finance constraints improve technical efficiency this paper analyses the mechanisms through which binding finance constraints can induce debt constrained firms to improve technical efficiency to guarantee positive profits this hypothesis is tested on a sample of firms belonging to the italian manufacturing technical efficiency scores are computed by estimating parametric production frontiers using the one stage approach as in battese and coelli battese g coelli t 1995 a model for technical efficiency effects in a stochastic frontier production function for panel data empirical economics 20 325 332 the results support the hypothesis that a restriction in the availability of financial resources can affect positively efficiency 2004 elsevier b v all rights reserved

the growth of multinational firms in the great recession abstract using a large firm level dataset this paper studies multinational firms performance during the great recession foreign multinationals grew faster than local firms outside of the crisis but slower during the crisis industry and size differences between domestic and foreign owned firms account for much of this slowdown however multinationals from different countries performed differently during the crisis the paper then assesses the role of multinationals in the global recession using a quantitative model had multinationals relative performance remained unchanged during the crisis the median country s aggregate growth would have been 0 12 higher with a range of 0 13 to 0 5 across countries

threshold effects of financial status on the cost frontiers of financial institutions in nondynamic panels this article applies hansen s 1999 2000 threshold regression model to estimate translog cost frontiers in the hope of shedding light on the banking industry s production processes and the extent of its technical efficiency te the threshold technique allows for the existence of multiple technologies of production distinguished by an exogenous threshold variable strong evidence of multiple technologies is found in the industry irrespective of which financial indicator as constructed by factor analysis defines the threshold variable cost savings and scale economies among the various underlying technologies are compared herein we also highlight the differences between the threshold results and the conventional cost frontier

household location and race estimates of a multinomial logit model a multinomial logit model of household location choice in which families choose from a number of mutually exclusive residential location is estimated regression results indicate that the locational choices of white and black households are importantly but differently affected by their socioeconomic characteristics in that regard black suburbanization patterns are little influenced by large simulated changes in household characteristics findings suggest that policies which focus on the educational and earnings opportunities of blacks would likely be largely ineffectual in fostering the integration of predominantly white suburban communities copyright 1989 by mit press

financial frictions and employment during the great depression abstract we provide new evidence that a disruption in credit supply played a quantitatively significant role in the unprecedented contraction of employment during the great depression using a novel hand collected dataset of large industrial firms our identification strategy exploits preexisting variation in the need to raise external funds at a time when public bond markets essentially froze local bank failures inhibited firms ability to substitute public debt for private debt which exacerbated financial constraints we estimate a large and negative causal effect of financing frictions on firm employment we find that the lack of access to credit likely accounted for a substantial fraction of the aggregate decline in employment of large firms between 1928 and 1933

inter industry mobility and the cyclical upgrading of labor we investigate whether a market clearing model is consistent with industry employment and wage patterns related to the cyclical upgrading of labor we demonstrate that roy s 1951 market clearing

financial distress and the business cycle in this paper we argue that firms financial distress should play a greater role in the macroeconomic analysis of the business cycle we provide a non technical account of a general equilibrium model that exhibits financially driven equilibrium cycles we show that the empirical evidence is widely supportive of the key hypothesis and implications of our approach we use the model in order to evaluate the effects of several policy measures it turns out that deepening the market for second hand capital goods subsidizing the interest payments of companies which start up when financial conditions are tight and bailing out some companies in default can indeed stabilize the economy by way of generalization we may say that the policy reaction to a financially driven bust should be accommodating

disequilibrium in the uk corporate loan market in the last decade a debate has resurfaced about whether financial constraints stemming from asymmetric information and incentive problems play an important role in propagating monetary policy shocks this paper investigates the monetary transmission mechanism in the uk and its impact on the availability of bank credit to small and medium size firms the empirical specification is based on a disequilibrium model that allows for the possibility of transitory credit rationing sample firms are classified endogenously into borrowing constrained and borrowing unconstrained the analysis of credit rationing takes into account not only firm specific variables but also important macroeconomic factors such as the prevailing monetary conditions and the stage of the business cycle we find that i firms assets play an important role as collateral in mitigating borrowing constraints ii during periods of tight monetary conditions corporate demand for bank credit increases whereas the supply of bank loans is reduced iii to avoid bank credit rationing smaller companies increase their reliance on interfirm credit iv the proportion of borrowing constrained firms is significantly higher during the recession years of the early 1990s than at other times

founded in adversity operations based survival strategies of ventures founded during a recession abstract we examine the survival of 404 new ventures founded during the 2008 recession we find that industry explains a significant but small percentage of variance in survival 2 81 percent and therefore focus on which operations related actions could enhance ventures odds of survival we find marginally significant support for our hypotheses that a venture founded during a recession is more likely to survive if it increases its production efficiency increases both its production efficiency and variable costs or increases both its production efficiency and fixed costs in property plant and equipment our findings demonstrate that operational decisions are key determinants of survival for ventures founded during a recession

lost generations of firms and aggregate labor market dynamics abstract can the unprecedented lack of startups during the u s great recession have persistently negative effects while fewer firms hiring workers can mechanically reduce employment for many years this may be offset by feedback effects on lower wages slacker labor markets and higher profits an estimated model of firm dynamics and frictional labor markets suggests that such feedback effects are too weak to offset the direct impact of fewer startups had firm entry remained constant during the great recession output would have recovered 4 6 years earlier and unemployment would have been 0 5 percentage points lower even 10 years after the crisis

spillover effects of human service facilities in a racially segmented housing market abstract previous studies of human service facility spillovers on residential property values have been inconclusive and have failed to take into account the effects of racial segmentation of housing markets likewise studies of racial discrimination in urban housing markets and price differentials between white and nonwhite areas of the city have failed to consider the impacts of service facilities on prices this study develops an hedonic price model of housing services in a racially segmented housing market which considers a variety of human service facilities and their spillover effects model results for oakland california in 1976 indicate that facilities significantly affect housing prices both positively and negatively and that these effects vary by racial submarket implications of these findings for the interpretation of past discrimination studies facility impact studies and social policy are considered

creditor protection and credit response to shocks this article studies the relationship between creditor protection and credit responses to macroeconomic shocks using a data set on legal determinants of finance in a panel of data on aggregate credit growth for 79 countries during 1990 2004 it is shown that credit is more responsive to external shocks in countries with weak legal creditor protection and weak enforcement the results are statistically and economically significant and robust to alternative measures of creditor protection to the inclusion of variables that reflect different stages of economic development to the restriction of the sample to only developing economies to the controls for systemic crises to alternative shock measures and to vector autoregressive specifications

reflex an adapted production simulation methodology for flexible capacity planning as intermittent energy resources become more significant in power production traditional capacity planning may be insufficient to ensure reliable system operation a system planner must ensure that flexibility solutions are available to respond to large and uncertain ramping events these solutions may be operational such as improved unit commitment and dispatch curtailment of renewables or demand response procurement based such as new fast ramping resources or batteries or involve market reform this paper outlines a new methodology for modeling the economic tradeoffs in implementing flexibility solutions for integrating renewables the proposed model includes both a stochastic treatment of system states to account for a wide range of operating conditions and an adapted production simulation methodology that weighs the cost of reliability and subhourly flexibility violations against the cost of the operational flexibility solutions available to mitigate them the model s functionality is demonstrated with a case study of california at a 50 rps in 2030 the model tests the value of 1088 mw of generic flexible units relative to the same capacity of must run resources finding an expected annual value of 347 pm 42 million yr potential applications of the model for resource planning and procurement are also discussed

equilibrium labor turnover firm growth and unemployment this paper considers equilibrium quit turnover in a frictional labor market with costly hiring by firms where large firms employ many workers and face both aggregate and firm specific productivity shocks there is exogenous firm turnover as new small startups enter the market over time while some existing firms fail and exit individual firm growth rates are disperse and evolve stochastically the paper highlights how dynamic monopsony where firms trade off lower wages against higher endogenous employee quit rates yields excessive job to job quits such quits directly crowd out the reemployment prospects of the unemployed with finite firm productivity states stochastic equilibrium is fully tractable and can be computed using standard numerical techniques

economic valuation of reserves in power systems with high penetration of wind power this paper proposes a methodology to determine the required level of spinning and nonspinning reserves in a power system with a high penetration of wind power the computation of the required reserve levels and their costs is achieved through a stochastic programming market clearing model spanning a daily time horizon this model considers the network constraints and takes into account the cost of both the load shedding and the wind spillage the methodology proposed is illustrated using an example and a realistic case study some conclusions are finally drawn

transition and enterprise restructuring the role of budget constraints and bankruptcy costs the focus of analysis is on the impact of financial leverage as a measure of bankruptcy costs on enterprise restructuring based on budget constraints in the economy data of bulgarian manufacturing firms allow comparison of firm behavior under soft and hard budget constraints as distinguished by the inception of a currency board in 1997 controlling for change in sales firm size and type of ownership statistically significant relationship between financial leverage and firm restructuring through labor adjustments is found to exist under hard budget constraints only

financial pressure monetary policy effects and inventories firm level evidence from a market based and a bank based financial system this paper examines the adjustment of inventories by firms in the united kingdom and spain which have two quite different financial systems a widely held view is that a key channel for monetary policy is through the influencing of inventory accumulation using a large company level panel data set for both countries significant effects associated with borrowing costs on inventories are estimated financial effects associated with liquidity and the borrowing ratio are estimated to be stronger in the uk than in spain since the spanish financial system is bank based while that of the uk is market based this is interpreted as contrary to the bank dependence hypothesis

movers and shakers most projects in most walks of life require the participation of multiple parties while it is difficult to unite individuals in a common endeavor some people who we call movers and shakers seem able to do it the paper specifically examines moving and shaking of an investment project whose return depends both on its quality and the total capital invested in it we analyze a model with two types of agents managers and investors managers and investors initially form social connections managers then bid to buy control of the project and the winning bidder puts effort into making investors aware of it finally a subset of aware investors are given the chance to invest and they decide whether to do so after receiving private signals of the project s quality we first show that connections are valuable since they make it easier for a manager to move and shake the project i e obtain capital from investors when we endogenize the network we find that while managers are identical ex ante a single manager emerges as most connected he consequently earns a rent in extensions we move away from the assumption of ex ante identical managers to highlight forces that lead one manager or another to become a mover and shaker our theory sheds light on a range of topics including entrepreneurship venture capital and anchor investments

program participation and farm level adoption of conservation tillage estimates from a multinomial logit model over the past decade conservation compliance has reduced soil erosion what will happen to these erosion benefits if commodity programs are eliminated or if the subsidy level is greatly reduced this study investigates whether there will be a significant decline in the amount of acreage on which conservation practices are adopted if future farm program benefits are not tied to conservation compliance

deleveraging crises and deep recessions a behavioural approach macroeconomic dynamics are characterized by alternating patterns of periods of relative stability and large swings standard micro founded macro economic models account for these patterns through exogenous and persistent shocks in this paper we develop a fully decentralized and micro founded macro economic agent based model augmented with an opinion model which produces endogenous waves of pessimism and optimism that feed back into firms leverage and households precautionary saving behaviour a major emergent property of our model is precisely the complex successions of stable and unstable macro economic regimes the model is further able to account for a wide spectrum of macro and micro empirical regularities within this framework we analyse a series of macro economic phenomena of key relevance in the current macro economic debate especially the occurrence of deleveraging crises and fisherian debt deflation recessions our analysis suggests that the relative dynamics of prices and wages and the resulting income distribution along a deflation ary path are critical determinants of the severity of the recession and the chances of recovery

revisions to us labor market data and the public s perception of the economy using the monthly employment situation reports for 1994 2013 this paper studies the revisions to us employment data the paper shows that the first press release underestimates net job creation in expansions and overestimates it in downturns the errors in reporting the data on the labor market can distort the public s perception about the stance of the labor market and have some political consequences this is well reflected by the finding that the job approval rating of president obama the index of consumer confidence and the economic conditions index of gallup have all been responding to the initial news on the us labor market as they were published in the employment situation reports

the contribution of large and small employers to job creation in times of high and low unemployment we document a negative correlation at business cycle frequencies between the net job creation rate of large employers and the level of aggregate unemployment that is much stronger than for small employers the differential growth rate of employment between initially large and small employers has an unconditional correlation of 0 5 with the unemployment rate and varies by about 5 percent over the business cycle we exploit several datasets from the united states denmark and france both repeated cross sections and job flows with employer longitudinal information spanning the last four decades and several business cycles we discuss implications for theories of factor demand jel d22 e23 e32 j23 l25

firm level entry and exit dynamics over the business cycles abstract this paper presents a set of facts on the cyclicality of firm births and deaths in the u s during the period 1979 2013 asymmetry in the cyclicality between firm birth and firm death is observed aggregate firm birth is generally significantly procyclical while the counter cyclicality in firm death is ambiguous and sensitive to the choice of cyclical indicator such a pattern exists within the majority of sectors as well and is mainly driven by small firms young firms are the main contributors to the findings on firm death activity further examination along the time dimension discovers a reason for the contemporaneous cyclicality or lack thereof which can be documented as a new fact firm births positively lead the usual business cycle measures and firm deaths positively lag them moreover cyclicality in business openings and closings differs from establishment level to firm level due to the internal adjustment of continuing firms

factor demands effective discount rates and liquidity constraints in the retail trade firm eunkyung kwon this is a firm level empirical study of the impact of credit market frictions on firm factor demands it extends previous work in two ways it studies the impact of liquidity constraints on both fixed investment and employment and examines data on retail firms using the euler equation approach it finds strong evidence for the impact of financial constraints on factor demands estimated relationships in turn induce striking countercyclical movements in effective discount rates of firms with limited access to credit the article concludes that the results found in previous work regarding excess sensitivities of investment to liquidity are indeed due to liquidity constraints jel e32 e44 e22 i introduction financing and investment decisions are not in general independent of one another when a firm has limited access to credit markets a number of empirical studies have provided evidence in support of this hypothesis 1 using the euler equation approach and firm level data these studies provide evidence for the role of imperfect financial markets in firms economic decisions they have two common features one is that they study the impact of liquidity constraints on only a single input typically investment the other is that they focus exclusively on the manufacturing sector this article extends the earlier work in two important ways first it examines the impact of liquidity constraints on multiple input choices in particular physical investment and employment second it incorporates data from nonmanufacturing sectors specifically retail trade studying the impact of liquidity constraints on multiple inputs is important for several reasons first it provides an additional testable restriction on the data by holding the impact of financial constraints constant over factor demands it is possible to identify the effects of financial constraints more strictly the idea is that if borrowing constraints truly affect firm factor demands then the impact of such constraints on a firm s discount rate should be the same across different input choices since previous studies considered investment only we cannot exclude the possibility that other factors e g fixed costs of adjustment capital irreversibility in capital etc may be responsible for data not conforming to the model s prediction hence finding the neoclassical model with the perfect capital market to have been misspecified second the analysis in this article considers a general model that allows for the possibility that demands for capital and labor are dynamically interrelated and so jointly determined as opposed to the previous model where optimal investment was determined solely by future investment and prices this generalization is important because the misspecification of the standard euler equation might be due to an assumption of no interactions between input demands rather than to capital market imperfections adding employment to the euler equation for investment is insightful regarding tests for the presence of financial constraints for several other reasons first it is quite straightforward to derive and analyze the euler equation for labor relative to other inputs such as inventories second firm employment decisions are more likely to be closely connected to a firm s physical investment decisions third it is commonly thought that firm labor decisions are rarely affected by liquidity constraints thus examining liquidity jointly on investment and employment is of particular interest for examining the empirical relevance of financial constraints 2 retail trade is an important cyclical sector that has received relatively little attention in the literature it is of particular interest to this study because one can make the case on a priori grounds that firms with imperfect access to credit have a substantial influence within this sector for example as described in a following section in retail trade firms that either do not issue publicly traded equity or do not have a rating to issue publicly traded bonds account for nearly 80 of economic activities in the retail sector

generation expansion planning optimisation with renewable energy integration a review generation expansion planning consists of finding the optimal long term plan for the construction of new generation capacity subject to various economic and technical constraints it usually involves solving a large scale non linear discrete and dynamic optimisation problem in a highly constrained and uncertain environment traditional approaches to capacity planning have focused on achieving a least cost plan during the last two decades however new paradigms for expansion planning have emerged that are driven by environmental and political factors this has resulted in the formulation of multi criteria approaches that enable power system planners to simultaneously consider multiple and conflicting objectives in the decision making process more recently the increasing integration of intermittent renewable energy sources in the grid to sustain power system decarbonisation and energy security has introduced new challenges such a transition spawns new dynamics pertaining to the variability and uncertainty of these generation resources in determining the best mix in addition to ensuring adequacy of generation capacity it is essential to consider the operational characteristics of the generation sources in the planning process in this paper we first review the evolution of generation expansion planning techniques in the face of more stringent environmental policies and growing uncertainty more importantly we highlight the emerging challenges presented by the intermittent nature of some renewable energy sources in particular we discuss the power supply adequacy and operational flexibility issues introduced by variable renewable sources as well as the attempts made to address them finally we identify important future research directions

financing of firms labor reallocation and the distributional role of monetary policy we analyze monetary policy in a heterogenous firms environment where cash con strained firms finance operations through external financing and cash unconstrained firms operate by using internal funds we show that firms respond differently to shocks expansionary monetary policy sharply increases the relative employment of the cash constrained firms while positive productivity shocks induce a rise in the relative employment of the cash unconstrained firms our analysis points to a clear role of monetary policy in reallocating resources across sectors that differ in their financing capabilities furthermore the predictions of our model match the empirical evidence implying that financially constrained firms react sharply to monetary policy shocks but are less cyclical than unconstrained firms following productivity shocks

estimating the distortionary effects of ethnic quotas in singapore using housing transactions abstract desegregation is a key policy issue in many countries i investigate a residential desegregation program in singapore the ethnic housing quotas i show that choice restrictions imposed on apartment blocks above the quota limits constrained could have distortionary effects causing price and quantity differences for constrained versus unconstrained blocks i test these predictions by hand matching more than 500 000 names in the phonebook to ethnicities to calculate ethnic proportions at the apartment block level i can then investigate differences for constrained and unconstrained blocks close to the quota limits and test for sorting around the limits i find that price differences are between 3 and 5 quantity effects are economically significant translating to longer time on market durations selection cannot fully explain these results my results point to challenges in achieving desegregation using quantity restrictions

measuring racial discrimination with fair housing audits caught in the act a survey technique called a fair housing audit provides a direct measure of racial discrimination in housing this paper examines the econometric issues raised by audit data measures the discrimination uncovered by a 1981 boston study and tests hypotheses about the causes of discrimination the estimated level of discrimination is high black housing seekers are told about 30 percent fewer available housing units than are whites the hypothesis tests indicate that the primary cause of this discrimination is that housing agents illegally promote their economic interests by catering to the racial prejudice of their current or potential white customers

firm leverage consumer demand and employment losses during the great recession this article argues that firms balance sheets were instrumental in the transmission of consumer demand shocks during the great recession using micro level data from the u s census bureau we find that establishments of more highly levered firms experienced significantly larger employment losses in response to declines in local consumer demand these results are not driven by firms being less productive having expanded too much prior to the great recession or being generally more sensitive to fluctuations in either aggregate employment or house prices likewise at the county level we find that counties with more highly levered firms experienced significantly larger declines in employment in response to local consumer demand shocks accordingly firms balance sheets also matter for aggregate employment our results suggest a possible role for employment policies that target firms directly besides conventional stimulus