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Articles 1 - 30 of 98
Full-Text Articles in Social and Behavioral Sciences
Local Competition, Multimarket Contact, And Product Quality: Evidence From Internet Service Provision, Kyle Wilson
Local Competition, Multimarket Contact, And Product Quality: Evidence From Internet Service Provision, Kyle Wilson
Pomona Faculty Publications and Research
I investigate the effect of competition on quality in the internet service provision industry: I examine both local competition within markets and multimarket contact among firms across markets. This industry offers an ideal setting, as quality is both objective and measurable. I use data from speedtest.net from 2008 to 2014 to estimate a reduced-form model of the effects of local competition and multimarket contact on realized consumer download speeds. I find that increased multimarket contact leads to decreased download speeds, which is consistent with the mutual forbearance hypothesis. I also find that duopolies lead to faster download speeds than do …
Endogenous Preferences: A Challenge To Constitutional Political Economy's Normative Foundation?, Malte Dold
Endogenous Preferences: A Challenge To Constitutional Political Economy's Normative Foundation?, Malte Dold
Pomona Faculty Publications and Research
This paper starts with the observation from behavioral economics that preferences are endogenous, i.e., they are unstable, context-dependent, and open to processes of adaptation. It then asks whether welfare analysis and normative economics are still possible in a world populated by people with endogenous preferences. In particular, it looks at recent proposals by Viktor Vanberg and Carl Christian von Weizsacker. In highlighting an institutional perspective, both can be seen as proponents of modern ordoliberalism and both claim that their approaches can deal with the issue of endogenous preferences in a more coherent way than approaches that remain within the mind …
Behavioural Normative Economics: Foundations, Approaches And Trends, Malte Dold
Behavioural Normative Economics: Foundations, Approaches And Trends, Malte Dold
Pomona Faculty Publications and Research
This article summarises the theoretical foundations, main approaches and current trends in the field of behavioural normative economics. It identifies bounded rationality and bounded willpower as the two core concepts that have motivated the field. Since the concepts allow for individual preferences to be context-dependent and time-inconsistent, they pose an intricate problem for standard welfare analysis. The article discusses the ways in which two prominent approaches - the preference purification approach and the opportunity approach - have tackled the problem. It argues that shortcomings in each of these approaches motivate an agency-centric perspective. The article presents two concrete policy proposals …
The Role Of Cost, Scale, And Property Attributes In Landowner Choice Of Stormwater Management Option., W. Bowman Cutter, Alexander Pusch
The Role Of Cost, Scale, And Property Attributes In Landowner Choice Of Stormwater Management Option., W. Bowman Cutter, Alexander Pusch
Pomona Economics
Cities throughout the world are experimenting with Low Impact Development (LID) strategies to replace ecosystem services degraded by urbanization. Stormwater management may need both centralized/publicly-managed infrastructure and decentralized provision by landowners. For landowners to participate in these programs they will need some latitude in the choice of techniques and siting. However, these landowner choices will affect the bundle of ecosystem services provided (such as infiltration, aesthetics, pollution filtering, and others) as well as their spatial distribution. We studied the Santa Monica (CA) stormwater regulations that require stormwater management on a large portion of development and redevelopment but allow a significant …
The Shadow Cost Of Parking Minimums: Evidence From Los Angeles County, Sofia Franco, W. Bowman Cutter, Skyler Lewis
The Shadow Cost Of Parking Minimums: Evidence From Los Angeles County, Sofia Franco, W. Bowman Cutter, Skyler Lewis
Pomona Economics
Minimum Parking Requirements (MPRs) are almost universal in U.S. cities and common in the rest of the world. In the U.S., parking requirements for commercial buildings commonly require 700 ft2 of parking for each 1000 ft2 of floor space. To the extent this is a binding requirement, MPRs could result in distortion in commercial development. MPRs require either the allocation of land for parking, or very costly substitution of structured parking for land. Therefore, MPR distortions are likely to increase with the value of land. A steep gradient in the cost of the MPRs leads to the possibility …
The International Spread Of Covid-19 Stock Market Collapses, Silvio Contessi, Pierangelo De Pace
The International Spread Of Covid-19 Stock Market Collapses, Silvio Contessi, Pierangelo De Pace
Pomona Economics
We identify periods of mildly explosive dynamics and collapses in the stock markets of 18 major countries during the first wave of the COVID-19 pandemic of 2020. We find statistical evidence of instability transmission from the Chinese stock market to all other markets. The recovery is heterogeneous and generally non-explosive.
Comovement And Instability In Cryptocurrency Markets, Pierangelo De Pace, Jayant Rao
Comovement And Instability In Cryptocurrency Markets, Pierangelo De Pace, Jayant Rao
Pomona Economics
We analyze the extent of comovement between daily price returns of nine major cryptocurrencies during the first three main phases of their development, from April 2013 to November 2018. We assess its evolution using bivariate and multivariate modelling approaches, and detect pronounced time variation. Generally, comovement is initially low and positive, but increases between early 2017 and late 2018. We then adopt a right-tail version of the Augmented Dickey-Fuller unit root test to identify periods of mildly explosive behavior (statistical instability) in the Network Value to Transactions (NVT) ratio (a measure of the dollar value of cryptocurrency transaction activity relative …
Mildly Explosive Dynamics In U.S. Fixed Income Markets, Silvio Contessi, Pierangelo De Pace, Massimo Guidolin
Mildly Explosive Dynamics In U.S. Fixed Income Markets, Silvio Contessi, Pierangelo De Pace, Massimo Guidolin
Pomona Economics
We use a recently developed right-tail variation of the Augmented Dickey-Fuller unit root test to identify and date-stamp periods of mildly explosive behavior in the weekly time series of eight U.S. fixed income yield spreads between September 2002 and April 2018. We find statistically significant evidence of mildly explosive dynamics in six of these spreads, two of which are short/medium-term mortgage- related spreads. We show that the time intervals characterized by instability that we estimate from these yield spreads capture known episodes of financial and economic distress in the U.S. economy. Mild explosiveness migrates from short-term funding markets to medium- …
The Chinese Real Estate Bubble, Gary N. Smith, Wesley Liang
The Chinese Real Estate Bubble, Gary N. Smith, Wesley Liang
Pomona Economics
China has seen extraordinary economic growth for the past two decades, coupled with a booming housing market. Following the 2008 financial crisis, however, observers began worrying that the Chinese real estate market had been gripped by a speculative bubble. We use residential rent and price data to assess whether these fears are justified. We conclude that residential real estate markets are bubbly in Beijing and Shanghai, with the Beijing housing market frothier than the Shanghai market.
The Name Game: The Importance Of Resourcefulness, Ruses, And Recall In Stock Ticker Symbols, Gary N. Smith, Naomi Baer, Erica Barry
The Name Game: The Importance Of Resourcefulness, Ruses, And Recall In Stock Ticker Symbols, Gary N. Smith, Naomi Baer, Erica Barry
Pomona Economics
Previous research reported that a portfolio of stocks with clever ticker symbols outperformed the overall market by a significant margin during the years 1984 to 2005. This paper reports the performance of those stocks during the subsequent years 2006 to 2018, and also investigates the 2006-2008 performance of a new set of clever-ticker stocks. Both clever-ticker portfolios beat the market by a substantial margin, supporting the resiliency of the clever-ticker phenomenon.
It Is Time To Kill The Economic Theory Of Suicide, Gary N. Smith
It Is Time To Kill The Economic Theory Of Suicide, Gary N. Smith
Pomona Economics
A seminal paper by Hamermesh and Soss modeled suicide as a rational economic decision based on a comparison of the financial costs and benefits of staying alive. Their model is fundamentally flawed and their prediction that suicide rates increase with age is wrong.
Be Wary Of Black-Box Trading Algorithms, Gary N. Smith
Be Wary Of Black-Box Trading Algorithms, Gary N. Smith
Pomona Economics
Black-box algorithms now account for nearly a third of all U. S. stock trades. It is a mistake to think that these algorithms possess superhuman intelligence. In reality, computers do not have the common sense and wisdom that humans have accumulated by living. Trading algorithms are particularly dangerous because they are so efficient at discovering statistical patterns—but so utterly useless in judging whether the discovered patterns are meaningful.
The Paradox Of Big Data, Gary N. Smith
The Paradox Of Big Data, Gary N. Smith
Pomona Economics
Data-mining is often used to discover patterns in Big Data. It is tempting believe that because an unearthed pattern is unusual it must be meaningful, but patterns are inevitable in Big Data and usually meaningless. The paradox of Big Data is that data mining is most seductive when there are a large number of variables, but a large number of variables exacerbates the perils of data mining.
The Principal Problem With Principal Components Regression, Heidi Margaret Artigue, Heidi Margaret Artigue
The Principal Problem With Principal Components Regression, Heidi Margaret Artigue, Heidi Margaret Artigue
Pomona Faculty Publications and Research
Principal components regression (PCR) reduces a large number of explanatory variables down to a small number of principal components. PCR is thought to be more useful, the more numerous the potential explanatory variables. The reality is that a large number of candidate explanatory variables does not make PCR more valuable; instead, it magnifies the failings of PCR.
How Global Rules And Markets Are Shaping India’S Rise On The International Stage, Aseema Sinha
How Global Rules And Markets Are Shaping India’S Rise On The International Stage, Aseema Sinha
CMC Faculty Publications and Research
Over the last quarter century, India has shifted from a hesitant economic power to a confident player on the international stage. In her new book, Aseema Sinha draws on extensive research to ask where this global activism has come from, and considers the international dimensions of domestic change. Here she discusses how her findings challenge standard narratives on globalisation and the supposedly homegrown character of India’s reform trajectory.
The Developmental Effect Of State Alcohol Prohibitions At The Turn Of The 20th Century, Mary F. Evans, Eric Helland, Jonathan Klick, Ashwin Patel
The Developmental Effect Of State Alcohol Prohibitions At The Turn Of The 20th Century, Mary F. Evans, Eric Helland, Jonathan Klick, Ashwin Patel
CMC Faculty Publications and Research
We examine the quasi-randomization of alcohol consumption created by state-level alcohol prohibition laws passed in the United States in the early part of the twentieth century. Using a large dataset of World War II enlistees, we exploit the differential timing of these laws to examine their effects on adult educational attainment, obesity, and height. We find statistically significant effects for education and obesity that do not appear to be the result of pre-existing trends. Our findings add to the growing body of economic studies that examine the long-run impacts of in utero and childhood environmental conditions.
Book Review, Political Science. Volume 1, The Indian State. Icssr Research Surveys And Explorations, Aseema Sinha
Book Review, Political Science. Volume 1, The Indian State. Icssr Research Surveys And Explorations, Aseema Sinha
CMC Faculty Publications and Research
This book maps the scholarly terrain on the Indian state. The book holds great promise, as the last survey was done in 1995. The volume seeks to understand the state through an analysis of the “social character” of the Indian state, the political economy of the Indian state, social policy, and law and rights. It is a well-edited collection from scholars based in India.
Mass Media Consumption In Post-Soviet Kyrgyzstan And Kazakhstan: The View From Below, Barbara Junisbai, Azamat Junisbai, Nicola Ying Fry
Mass Media Consumption In Post-Soviet Kyrgyzstan And Kazakhstan: The View From Below, Barbara Junisbai, Azamat Junisbai, Nicola Ying Fry
Pitzer Faculty Publications and Research
This article examines how ordinary people utilize and assess the information options available to them drawing on original, nationally representative surveys conducted in 2012 in Kazakhstan and Kyrgyzstan, two regimes characterized by different trajectories since independence. In both countries, television is the main go-to source, while the Internet is used least. Trust in media, however, follows an unexpected pattern. On average, media enjoy higher levels of trust in Kazakhstan than in Kyrgyzstan, despite greater media independence and pluralism in the latter. Ironically, open political competition and media freedom in Kyrgyzstan may have a dampening effect on public trust, while in …
Standardization And The Impacts Of Voluntary Program Participation: Evidence From Environmental Auditing, Mary F. Evans, Lirong Liu, Sarah L. Stafford
Standardization And The Impacts Of Voluntary Program Participation: Evidence From Environmental Auditing, Mary F. Evans, Lirong Liu, Sarah L. Stafford
CMC Faculty Publications and Research
We explore how limits to our insight about the underlying decision-making structure of firms may affect the conclusions we draw about the likely impacts of participation in voluntary environmental programs. We develop a theoretical model to examine the conditions under which a multi-facility firm chooses to employ a standardized adoption policy for a voluntary program. We test this model empirically using a firm-level dataset on the adoption of a voluntary environmental auditing program and find that, consistent with the theoretical model, a standardized auditing outcome is less likely among firms with more heterogeneous portfolios of facilities. We also examine the …
The Vicious Cycle: Fundraising And Perceived Viability In U.S. Presidential Primaries, Cameron A. Shelton, James J. Feigenbaum
The Vicious Cycle: Fundraising And Perceived Viability In U.S. Presidential Primaries, Cameron A. Shelton, James J. Feigenbaum
CMC Faculty Publications and Research
Scholars of presidential primaries have long posited a dynamic positive feedback loop between fundraising and electoral success. Yet existing work on both directions of this feedback remains inconclusive and is often explicitly cross-sectional, ignoring the dynamic aspect of the hypothesis. Pairing high-frequency FEC data on contributions and expenditures with Iowa Electronic Markets data on perceived probability of victory, we examine the bidirectional feedback between contributions and viability. We find robust, significant positive feedback in both directions. This might suggest multiple equilibria: a candidate initially anointed as the front-runner able to sustain such status solely by the fundraising advantage conferred despite …
Linkage Politics And The Persistence Of National Policy Autonomy In Emerging Powers: Patents, Profits, And Patients In The Context Of Trips Compliance, Aseema Sinha, Tricia Olsen
Linkage Politics And The Persistence Of National Policy Autonomy In Emerging Powers: Patents, Profits, And Patients In The Context Of Trips Compliance, Aseema Sinha, Tricia Olsen
CMC Faculty Publications and Research
The Trade Related Intellectual Property Agreement (TRIPS) has had a profound effect on industrialization and innovation, as well as access to medicines in cases of public health crisis such as HIV/AIDS. However, compliance with TRIPS has varied in developing countries, despite heightened international pressure. For instance, Brazil has pursued a coherent approach to its HIV/AIDS health crisis, while India has failed to take care of its HIV patients despite late compliance with the TRIPS agreement and the presence of business firms that produce the generic medicines for HIV/AIDS. This article suggests that divergence in TRIPS compliance is the result of …
Policy Challenges In A Dual Exchange Rate Regime, Sven W. Arndt
Policy Challenges In A Dual Exchange Rate Regime, Sven W. Arndt
CMC Faculty Publications and Research
It is known that the effectiveness of macro policies depends on the exchange-rate regime. Pertinent models have typically considered either fixed or floating rates rather than mixed regimes. In recent years, however, the dollar has floated against most currencies, while being fixed against the yuan. This paper argues that a flex-price, dual-rate model consisting of the U.S., China and the Eurozone, combined with distinct adjustment patterns in tradables and non-tradables sectors and a tendency for policy makers to treat inflation in housing as pure asset inflation, provides a plausible explanation of the great moderation and its aftermath.
A Story Of Four Revolutions: Mechanisms Of Change In India, Aseema Sinha
A Story Of Four Revolutions: Mechanisms Of Change In India, Aseema Sinha
CMC Faculty Publications and Research
Sumit Ganguly and Rahul Mukherji’s India Since 1980 presents a bold and ambitious argument about change across and within India. Its unique contribution lies in its description of four distinct revolutions: social-political, economic, foreign policy, and religious. While many recent books have noted changes in India’s economy and foreign policy, India Since 1980 will be known for its juxtaposition of four different themes in one short, pithy volume. Even if one may disagree with the authors’ choice of the four dimensions of change, the book’s dominant message is that India is changing across a whole range of policies and arenas.
Scaling Down And Up: Can Subnational Analysis Contribute To A Better Understanding Of Micro-Level And National Level Phenomena?, Aseema Sinha
CMC Faculty Publications and Research
While cross-national analysis dominates comparative politics, many scholars have moved to the subnational level to test hypotheses generated at the national level. Subnational studies allow researchers to control for variation in a way that even the most sophisticated cross-national statistical studies are unable to.
Book Review: Modeling The Composition Of Government Expenditure, Cameron A. Shelton
Book Review: Modeling The Composition Of Government Expenditure, Cameron A. Shelton
CMC Faculty Publications and Research
Throughout the developed world, public finances dominate headlines. Given the widespread unsustainability of budget plans and the bitter attrition of retrenchment, they are like to do so for the next decade or more. As they have long done, different polities are likely to make different choices for how to spend dwindling public moneys. Understanding the sources of past heterogeneity—why countries have differed in their public spending—is thus of interest as we enter an age of fiscal adjustment. Messieurs Creedy and Moslehi offer us a technical primer laying the groundwork for modeling efforts.
Stabilization Policy In An Economy With Two Exchange Rate Regimes, Sven W. Arndt
Stabilization Policy In An Economy With Two Exchange Rate Regimes, Sven W. Arndt
CMC Faculty Publications and Research
This paper uses a flex-price open economy macro model to examine the effectiveness of U.S. monetary and fiscal policies when the dollar floats freely against the euro, but is fixed against the Chinese yuan. It is assumed that capital mobility is high between the U.S. and the Eurozone, but low between the U.S. and China. The model allows for short-run price flexibility and imperfect substitutability between domestic and foreign financial assets. The focus is on the implications for the efficacy of U.S. macro stabilization policies of China’s fixed-rate strategy. While many countries have pegged their currencies to the dollar, China …
Caught In A Poverty Trap? Testing For Single Vs. Multiple Equilibrium Models Of Growth, Cameron Shelton, Francisco R. Rodriguez
Caught In A Poverty Trap? Testing For Single Vs. Multiple Equilibrium Models Of Growth, Cameron Shelton, Francisco R. Rodriguez
CMC Faculty Publications and Research
We look for permanent effects to per capita GDP from exogenous, temporary shocks. Our shocks are temporary changes to the export revenues of small, open economies. We find no evidence that even the largest of these temporary shocks, in excess of 9.7% of GDP, produce permanent effects to the growth path of per capita GDP. The inability to reject a single-equilibrium world with shocks of this magnitude suggests that multiple-equilibria, if they exist, are too widely separated to be policy-relevant. Current aid initiatives, which are of a similar magnitude, are not likely to deliver transition to a higher growth path.
The "Great Moderation" In A Dual Exchange Rate Regime, Sven W. Arndt
The "Great Moderation" In A Dual Exchange Rate Regime, Sven W. Arndt
CMC Faculty Publications and Research
In the early nineties, the U.S. economy was emerging from a brief slump, monetary policy was easy, and economic activity recovered quickly during the decade, with GDP eventually reaching and then passing the consensus full employment level. Yet aggregate inflation remained surprisingly subdued. This moderation in prices at the aggregate level persuaded policy makers to allow the easy-money stance to continue in spite of the presence of inflation in non-tradables and in housing and construction in particular. This paper uses a flex-price, mixed-exchange rate model to examine some of the major contributing factors to economic developments in the two-decade period …
The Early Decision Option In College Admission And Its Impact On Student Diversity, Heather Antecol, Janet Kiholm Smith
The Early Decision Option In College Admission And Its Impact On Student Diversity, Heather Antecol, Janet Kiholm Smith
CMC Faculty Publications and Research
Colleges and universities that adopt early decision (ED) as an admission practice can generate additional resources by attracting wealthier students who make binding commitments to attend and forgo shopping for competing aid offers. An unanswered question is whether the resources generated from price discrimination are used by schools during the regular admission process to attract more diverse students. Using a sample of private national universities and liberal arts colleges, we model the choice to adopt an ED program and its impact on students’ racial and geographic diversity. We find that schools facing more competition for students are more likely to …
Review: Robert H. Nelson, The New Holy Wars: Economic Religion Vs. Environmental Religion In Contemporary America, Andre Wakefield
Review: Robert H. Nelson, The New Holy Wars: Economic Religion Vs. Environmental Religion In Contemporary America, Andre Wakefield
Pitzer Faculty Publications and Research
This is a book review of Robert H. Nelson's The New Holy Wars: Economic Religion vs. Environmental Religion in Contemporary America. Nelson argues that environmentalism and economics represent competing religious worldviews. Within this framework, debates over issues like global warming and acid rain become veiled theological disputes between these two “secular religions.” Nelson paints with a broad, aggressive brush. This is both the strength and weakness of his book, as he conjures a world of epic battles between the economic faithful, who worship material progress, and the environmentally pious, who bemoan the corruption visited by humans upon the natural world. …