Economics Commons^™

Pinning Down The Value Of Statistical Life, Thomas J. Kniesner, W. Kip Viscusi, Christopher Woock, James P. Ziliak

Center for Policy Research

Our research addresses fundamental long-standing concerns in the compensating wage differentials literature and its public policy implications: the econometric properties of estimates of the value of statistical life (VSL) and the wide range of such estimates from about $0.5 million to about $21 million. We address most of the prominent econometric issues by applying panel data, a new and more accurate fatality risk measure, and systematic selection of panel estimator in our research. Controlling for measurement error, endogeneity, individual heterogeneity, and state dependence yields both a reasonable average level and narrow range for the estimated value of a statistical life …

Estimating Heterogeneous Production In Fisheries, Kurt E. Schnier, Christopher M. Anderson, William Clinton Horrace

Center for Policy Research

Stochastic production frontier models are used extensively in the agricultural and resource economics literature to estimate production functions and technical efficiency, as well as to guide policy. Traditionally these models assume that each agent's production can be specified as a representative, homogeneous function. This paper proposes the synthesis of a latent class regression and an agricultural production frontier model to estimate technical efficiency while allowing for the possibility of production heterogeneity. We use this model to estimate a latent class production function and efficiency measures for vessels in the Northeast Atlantic herring fishery. Our results suggest that traditional measures of …

Identifying Technically Efficient Fishing Vessels: A Non-Empty, Minimal Subset Approach, Alfonso Flores-Lagunes, William Clinton Horrace, Kurt E. Schnier

Center for Policy Research

There is a growing resource economics literature, concerning the estimation of the technical efficiency of fishing vessels utilizing the stochastic frontier model. In these models, vessel output is regressed on a linear function of vessel inputs and a random composed error. Using parametric assumptions on the regression residual, estimates of vessel technical efficiency are calculated as the mean of a truncated normal distribution and are often reported in a rank statistic as a measure of a captain's skill and used to estimate excess capacity within fisheries. We demonstrate analytically that these measures are potentially flawed, and extend the results of …

Panel Unit Root Tests And Spatial Dependence, Badi H. Baltagi, Georges Bresson, Alain Pirotte

Center for Policy Research

This paper studies the performance of panel unit root tests when spatial effects are present that account for cross-section correlation. Monte Carlo simulations show that there can be considerable size distortions in panel unit root tests when the true specification exhibits spatial error correlation. These tests are applied to a panel data set on net real income from the 1000 largest French communes observed over the period 1985-1998.

Rational Alcohol Addiction: Evidence From The Russian Longitudinal Monitoring Survey, Badi H. Baltagi, Ingo Geishecker

Center for Policy Research

Alcohol consumption in Russia is legendary and has been reported to be the third leading cause of death in the former Soviet Union after heart disease and cancer. Are Russian alcohol consumers rational addicts? This paper uses eight rounds of a nationally representative Russian survey spanning the period 1994-2003 to estimate a rational addiction (RA) model for alcohol consumption. This is done in a panel data setting as well as on a wave by wave basis. The profile of the Russian drinker finds a huge difference between males and females and the model is estimated by gender. We do not …

The Asymptotics For Panel Models With Common Shocks, Chihwa Kao, Lorenzo Trapani, Giovanni Urga

Center for Policy Research

This paper develops a novel asymptotic theory for panel models with common shocks. We assume that contemporaneous correlation can be generated by both the presence of common regressors among units and weak spatial dependence among the error terms. Several characteristics of the panel are considered: cross sectional and time series dimensions can either be fixed or large; factors can either be observable or unobservable; the factor model can describe either cointegration relationship or a spurious regression, and we also consider the stationary case. We derive the rate of convergence and the distribution limits for the ordinary least squares (OLS) estimates …

Designing State Aid To Education In The Presence Of Property Tax Exemptions Part 2, John Yinger

Center for Policy Research

It’s Elementary is a series of essays on topics in education and education policy. The main focus is on education finance in New York State, but general research findings in education and education policy issues in several other states are also discussed. John Yinger, Professor of Economics and Public Administration at the Maxwell School, Syracuse University is the author of most of these essays, although a few are written by or co-authored with other scholars.

Results On The Bias And Inconsistency Of Ordinary Least Squares For The Linear Probability Model, William C. Horrace, Ronald L. Oaxaca

Economics - All Scholarship

This note formalizes bias and inconsistency results for ordinary least squares (OLS) on the linear probability model and provides sufficient conditions for unbiasedness and consistency to hold. The conditions suggest that a "trimming estimator" may reduce OLS bias.

November 2005, Syracuse Department Of Economics

Economics - All Scholarship

No abstract provided.

Designing State Aid To Education In The Presence Of Property Tax Exemptions Part 1, John Yinger

Center for Policy Research

It’s Elementary is a series of essays on topics in education and education policy. The main focus is on education finance in New York State, but general research findings in education and education policy issues in several other states are also discussed. John Yinger, Professor of Economics and Public Administration at the Maxwell School, Syracuse University is the author of most of these essays, although a few are written by or co-authored with other scholars.

Ranking Inequality: Applications Of Multivariate Subset Selection, William C. Horrace, Joseph T. Marchand, Timothy M. Smeeding

Economics - All Scholarship

Inequality measures are often presented in the form of a rank ordering to highlight their relative magnitudes. However, a rank ordering may produce misleading inference, because the inequality measures themselves are statistical estimators with different standard errors, and because a rank ordering necessarily implies multiple comparisons across all measures. Within this setting, if differences between several inequality measures are simultaneously and statistically insignificant, the interpretation of the ranking is changed. This study uses a multivariate subset selection procedure to make simultaneous distinctions across inequality measures at a pre-specified confidence level. Three applications of this procedure are explored using country-level data …

Gentrification And Neighborhood Housing Cycles: Will America's Future Downtowns Be Rich?, Jan K. Brueckner, Stuart S. Rosenthal

Economics - All Scholarship

This paper identifies a new factor, the age of the housing stock, that affects where high- and low-income neighborhoods are located in U.S. cities. High-income households, driven by a high demand for housing services, will tend to locate in areas of the city where the housing stock is relatively young. Because cities develop and redevelop from the center outward over time, the location of these neighborhoods varies over the city's history. The model predicts a suburban location for the rich in an initial period, when young dwellings are found only in the suburbs, while predicting eventual gentrification once central redevelopment …

Unintended Consequences Of Property Tax Relief: New York's Star Program, Tae Ho Eom, William Duncombe, John Yinger

Center for Policy Research

New York’s School Tax Relief Program, STAR, provides state-funded property tax relief for homeowners. Like a matching grant, STAR changes the price of public services, thereby altering the incentives of voters and school officials and leading to unintended consequences. Using data for New York State school districts before and after STAR was implemented, we find that STAR resulted in small increases in student performance along with significant decreases in the efficiency with which this performance is delivered and significant increases in school spending and property tax rates. These tax-rate increases magnify existing inequities in New York State’s education finance system.

Social Interactions In Labor Supply, Andrew Grodner, Thomas J. Kniesner

Center for Policy Research

Our research examines the effect of interdependence on estimation and interpretation of earnings/labor supply equations. We consider the cases of (1) a positive spillover from others’ labor supplied and (2) a need for conformity with others’ labor supplied. Qualitative and quantitative comparative statics results with a Stone-Geary utility function demonstrate how spillover effects increase labor supply uniformly. Alternatively, conformity effects move labor supplied toward the mean of the reference group so that, in the limit, labor supply becomes perfectly inelastic at the reference group average. When there are un-modeled exogenous social interactions, conventional wage elasticities are still relatively well estimated …

How To Pay For Education Finance Reform, John Yinger

Center for Policy Research

It’s Elementary is a series of essays on topics in education and education policy. The main focus is on education finance in New York State, but general research findings in education and education policy issues in several other states are also discussed. John Yinger, Professor of Economics and Public Administration at the Maxwell School, Syracuse University is the author of most of these essays, although a few are written by or co-authored with other scholars.

Ranking Inequality: Applications Of Multivariate Subset Selection, William C. Horrace, Joseph T. Marchand, Timothy M. Smeeding

Center for Policy Research

Inequality measures are often presented in the form of a rank ordering to highlight their relative magnitudes. However, a rank ordering may produce misleading inference, because the inequality measures themselves are statistical estimators with different standard errors, and because a rank ordering necessarily implies multiple comparisons across all measures. Within this setting, if differences between several inequality measures are simultaneously and statistically insignificant, the interpretation of the ranking is changed. This study uses a multivariate subset selection procedure to make simultaneous distinctions across inequality measures at a pre-specified confidence level. Three applications of this procedure are explored using country-level data …

How Unobservable Productivity Biases The Value Of A Statistical Life, Thomas J. Kniesner, W. Kip Viscusi, James P. Ziliak, Christopher Woock

Economics - All Scholarship

A prominent theoretical controversy in the compensating differentials literature concerns unobservable individual productivity. Competing models yield opposite predictions depending on whether the unobservable productivity is safety-related skill or productivity generally. Using five panel waves and several new measures of worker fatality risks, first-difference estimates imply that omitting individual heterogeneity leads to overestimates of the value of statistical life, consistent with the latent safety-related skill interpretation. Risk measures with less measurement error raise the value of statistical life, the net effect being that estimates from the static model range from $5.3 million to $6.7 million, with dynamic model estimates somewhat higher.

School Finance Reform And Property Values, Part 2: Public Service Capitalization, John Yinger

Center for Policy Research

It’s Elementary is a series of essays on topics in education and education policy. The main focus is on education finance in New York State, but general research findings in education and education policy issues in several other states are also discussed. John Yinger, Professor of Economics and Public Administration at the Maxwell School, Syracuse University is the author of most of these essays, although a few are written by or co-authored with other scholars.

School Finance Reform And Property Values Part 1: Property Tax Capitalization, John Yinger

Center for Policy Research

It’s Elementary is a series of essays on topics in education and education policy. The main focus is on education finance in New York State, but general research findings in education and education policy issues in several other states are also discussed. John Yinger, Professor of Economics and Public Administration at the Maxwell School, Syracuse University is the author of most of these essays, although a few are written by or co-authored with other scholars.

The Only Game In Town: Stock-Price Consequences Of Local Bias, Jeffrey D. Kubik, Harrison Hong, Jeremy Stein

Economics - All Scholarship

Theory suggests that, in the presence of local bias, the price of a stock should be decreasing in the ratio of the aggregate book value of firms in its region to the aggregate risk tolerance of investors in its region. We test this proposition using data on U.S. Census regions and states, and find clear-cut support for it. Most of the variation in the ratio of interest comes from differences across regions in aggregate book value per capita. Regions with low population density - e.g., the Deep South - are home to relatively few firms per capita, which leads to …

School District Responses To State Aid Programs, John Yinger

Center for Policy Research

It’s Elementary is a series of essays on topics in education and education policy. The main focus is on education finance in New York State, but general research findings in education and education policy issues in several other states are also discussed. John Yinger, Professor of Economics and Public Administration at the Maxwell School, Syracuse University is the author of most of these essays, although a few are written by or co-authored with other scholars.

The Unintended Consequences Of Property Tax Relief, John Yinger

Center for Policy Research

It’s Elementary is a series of essays on topics in education and education policy. The main focus is on education finance in New York State, but general research findings in education and education policy issues in several other states are also discussed. John Yinger, Professor of Economics and Public Administration at the Maxwell School, Syracuse University is the author of most of these essays, although a few are written by or co-authored with other scholars.

Some Results On The Multivariate Truncated Normal Distribution, William C. Horrace

Economics - All Scholarship

This note formalizes some analytical results on the n-dimensional multivariate truncated normal distribution where truncation is one-sided and at an arbitrary point. Results on linear transformations, marginal and conditional distributions, and independence are provided. Also, results on log-concavity, A-unimodality and the MTP_2 property are derived.

Movement Of Economics Professors Among Top Research Universities In The Us, Benjamin E. Resnick

Renée Crown University Honors Thesis Projects - All

Abstract not Included

The Failure Of Vertical Mergers, Frederick M. Schwarz

Renée Crown University Honors Thesis Projects - All

Creating successful vertical mergers is a challenge for organizations across Corporate America. This honors thesis contains a study of five of those vertical mergers. To complete this study, five mini cases were created that outlined those deals. In addition, statistical analysis of the post merger abnormal returns was completed for each of these deals. Abnormal returns are calculated as the difference between the returns occurring in the post-merger period and the normal returns, i.e., the returns that would have been expected if the merger had not taken place.

This thesis targets the mergers of Viacom Corporation and CBS, Merck Corporation …

The College Football Gambling Market An Empirical Approach, Brian Mcneil

Renée Crown University Honors Thesis Projects - All

This study tests the efficiency of the college football gambling market and whether the market allows for profitable wagering. Operating upon the theoretical framework that, at any given time, prices fully reflect all information available in a particular market, I test for the existence of residual information that is not currently incorporated into the market, thus rendering it inefficient. This project expands upon several previous studies performed on sports betting – most notably that of Zuber, Gandar, and Bowers (1985), which examined the gambling market efficiency for National Football League games. The findings prove to be consistent with the conclusions …

China’S Financial Institutions: Analysis Of The Dynamic Changes And Associated Inefficiencies Under A Hybrid Capitalistic Approach, Juan J. Zhou

Renée Crown University Honors Thesis Projects - All

Chinahas risen to the forefront of international scrutiny because of its unique political and economic structure and evolution. The growth and development ofChinaas a world economic power has resulted from the political-economic reform efforts of Communist leaders withinChina. Under Mao Ze Dong, during the pre-socialistic modernization period,Chinabegan its reform of rehabilitation from war time and social-economic restructuring by instituting socialistic ideology. During the Dengist period under Deng Xiao Ping, there was a transition from an agricultural to an industrial economy. After Deng, socialist modernization reform has continued underChina’s hybrid capitalistic economic model, with particularly significant effects on the rapidly structured …

Connections Between U.S. Consumer Magazine Cover Characteristics And Single Copy Sales Circulation, Stephanie C. Barlow

Renée Crown University Honors Thesis Projects - All

In the realm of journalism, conventional wisdom suggests that magazine covers “sell” magazines at newsstands. This study explores this idea by looking at the econometric relationship between cover characteristics such as presence of people and “catch” words and single copy sales. Several significant characteristics influencing such sales are found. In addition, this study is based on a new data set developed by the author indicating various characteristics of numbers of magazine covers over a five-year time span.

Specifically, a set of 14 magazines were observed for 10 characteristics. The percentage of the presence of these characteristics on magazine covers over …

School District Consolidation, John Yinger

Center for Policy Research

It’s Elementary is a series of essays on topics in education and education policy. The main focus is on education finance in New York State, but general research findings in education and education policy issues in several other states are also discussed. John Yinger, Professor of Economics and Public Administration at the Maxwell School, Syracuse University is the author of most of these essays, although a few are written by or co-authored with other scholars.

April 2005, Syracuse Department Of Economics

Economics - All Scholarship

No abstract provided.