Economics Commons^™

(Wp 2011-09) The Development Effects Of Natural Resources: A Geographical Dimension, Fabrizio Carmignani, Abdur Chowdhury

Economics Working Papers

Despite the recent growth resurgence, Sub-Saharan Africa (SSA) remains the poorest region in the world. At the same time, it is a region that heavily relies on natural resources. In this paper we investigate the extent to which the second fact helps explain the first one. The distinctive feature of our study is that we take a geographical perspective and allow the effect of natural resources to differ across regions of the world. Our findings suggest that (i) the effect of natural resource intensity on per-capita income is positive and significant in general, but almost negligible and possibly negative in …

Arrow-Fisher-Hanemann-Henry And Dixit-Pindyck Option Values Under Strategic Interactions, Tomoki Fujii, Ryuichiro Ishikawa

Research Collection School Of Economics

We extend the Arrow-Fisher-Hanemann-Henry (AFHH) and Dixit-Pindyck (DP) option values to game situations. By reinterpreting the AFHH option value as a change in the surplus from conservation because of the prospect of future information, we deal with the conceptual difficulty associated with the AFHH option value in the presence of strategic interactions. We then introduce the DP option value into a game situation. We show that the equivalence between the expected value of information and the DP option value in the standard model does not hold under strategic interactions.

Impact Of Food Inflation On Poverty In The Philippines, Tomoki Fujii

Research Collection School Of Economics

We simulate the impact of actual food price increase between June 2006 and June 2008 on poverty across different areas and whether the household’s main income source is agricultural activities. We explicitly treat heterogeneity in food price changes and the patterns of consumption and production by merging a expenditure survey dataset and a price dataset at the provincial level or lower. While the increase of head count index is larger for non-agricultural households than agricultural households, the opposite is true for the poverty gap and poverty severity measures, because poor agricultural households are particularly vulnerable to food inflation.

Specification Sensitivity In Right-Tailed Unit Root Testing For Explosive Behavior, Peter C. B. Phillips, Shu-Ping Shi, Jun Yu

Research Collection School Of Economics

Right-tailed unit root tests have proved promising for detecting exuberance in economic and financial activities. Like left-tailed tests, the limit theory and test performance are sensitive to the null hypothesis and the model specification used in parameter estimation. This paper aims to provide some empirical guidelines for the practical implementation of right-tailed unit root tests, focusing on the sup ADF test of Phillips, Wu and Yu (2011), which implements a right-tailed ADF test repeatedly on a sequence of forward sample recursions. We analyze and compare the limit theory of the sup ADF test under deferent hypotheses and model specifications. The …

Linear Programming-Based Estimators In Simple Linear Regression, Daniel P. A. Preve, Marcelo C. Medeiros

Research Collection School Of Economics

In this paper we introduce a linear programming estimator (LPE) for the slope parameter in a constrained linear regression model with a single regressor. The LPE is interesting because it can be superconsistent in the presence of an endogenous regressor and, hence, preferable to the ordinary least squares estimator (LSE). Two different cases are considered as we investigate the statistical properties of the LPE. In the first case, the regressor is assumed to be fixed in repeated samples. In the second, the regressor is stochastic and potentially endogenous. For both cases the strong consistency and exact finite-sample distribution of the …

A New Necessary Condition For Implementation In Iteratively Undominated Strategies, Takashi Kunimoto, Roberto Serrano

Research Collection School Of Economics

We uncover a new necessary condition for implementation in iteratively undominated strategies by mechanisms that satisfy the “best element property” where for each agent, there exists a strategy profile that gives him the highest payoff in the mechanism. This class includes finite and regular mechanisms. We conclude that either the quasilinearity-like assumptions of available sufficiency results cannot be completely dispensed with or some mechanisms that do not satisfy the best element property must be employed. We term the condition “restricted deception-proofness.” It requires that, in environments with identical preferences, the social choice function be immune to all deceptions, making it …

Intertemporal Substitution In The Time Allocation Of Married Women, Ken Yamada

Research Collection School Of Economics

This paper studies a life-cycle model of home production to examine how married women change their allocation of time in response to evolutionary movements along the life-cycle wage profile in Japan. After accounting for the potential bias due to heterogeneity, measurement error, weak instruments, and missing data, the estimates of intertemporal substitution elasticity obtained from the home production model are moderate and similar to those obtained from the standard labor supply model.

Specification Testing For Nonparametric Structural Models With Monotonicity In Unobservables, Stefan Hoderlein, Liangjun Su, Halbert White

Research Collection School Of Economics

Monotonicity in a scalar unobservable is a now common assumption in economic theory and applications. Among other things, it allows one to recover the underlying structural function from certain conditional quantiles of observables. Nevertheless, monotonicity is a strong assumption, and its failure can have substantive adverse consequences for structural inference. So far, there are no generally applicable nonparametric specification tests designed to detect monotonicity failure. This paper provides such a test for cross-section data. We show how to exploit an exclusion restriction together with a conditional independence assumption, plausible in a variety of applications, to construct a test. Our statistic …

Custodes Invicem Custodiunt: Commitment Through Competition, Madhav S. Aney, Giovanni Ko

Research Collection School Of Economics

How can specialists in violence, such as the military or the police, commit not to expropriate from producers? In this paper we propose competition between these agents as one of the mechanisms that can deter predation. In our model, even if specialists in violence could expropriate all output costlessly, it is attractive to protect producers from predators. This is because there is a marginal defensive advantage and consequently defense is an effective way to potentially eliminate other specialists in violence, reducing competition and leading to higher future payoffs. Hence, producers can offer transfers to specialists in violence that make defense …

Dating The Timeline Of Financial Bubbles During The Subprime Crisis, Peter C. B. Phillips, Jun Yu

Research Collection School Of Economics

A new recursive regression methodology is introduced to analyze the bubble characteristics of various financial time series during the subprime crisis. The methods modify a technique proposed in Phillips, Wu, and Yu (2011) and provide a technology for identifying bubble behavior with consistent dating of their origination and collapse. The tests serve as an early warning diagnostic of bubble activity and a new procedure is introduced for testing bubble migration across markets. Three relevant financial series are investigated, including a financial asset price (a house price index), a commodity price (the crude oil price), and one bond price (the spread …

Double Asymptotics For An Explosive Continuous Time Model, Xiaohu Wang, Jun Yu

Research Collection School Of Economics

This paper develops a double asymptotic limit theory for the persistent parameter (θ) in an explosive continuous time model with a large number of time span (N) and a small number of sampling interval (h). The limit theory allows for the joint limits where N → ∞ and h → 0 simultaneously, the sequential limits where N → ∞ is followed by h → 0, and the sequential limits where h → 0 is followed by N → ∞. All three asymptotic distributions are the same. The initial condition, either fixed or random, appears in the limiting distribution. The simultaneous …

Mncs And The Labour Crunch: Local Jobs May Suffer If Foreign Supply Is Curbed, Hian Teck Hoon

Research Collection School Of Economics

No abstract provided.

Understanding And Teaching Unequal Probability Of Selection, Humberto Barreto, Manu Raghav

School of Business and Leadership Working Papers

This paper focuses on econometrics pedagogy. It demonstrates the importance of including probability weights in regression analysis using data from surveys that do not use simple random samples (SRS). We use concrete, numerical examples and simulation to show how to effectively teach this difficult material to a student audience. We relax the assumption of simple random sampling and show how unequal probability of selection can lead to biased, inconsistent OLS slope estimates. We then explain and apply probability weighted least squares, showing how weighting the observations by the reciprocal of the probability of inclusion in the sample improves performance. The …

Intrastate Switched Telephone Access Charges In Kentucky, Christopher Jepsen, Frank Scott, Jesse Zenthoefer

CBER Research Report

Excerpt from the executive summary:

This report examines the economic consequences of the current access rate system for intrastate long-distance calls, governed by the Kentucky Public Service Commission. At the time Kentucky created an access rate system for telephone service in 1984, the main goal of telecommunication policy was universal wireline access. Since then the telecommunications landscape has changed dramatically, as well as current policy goals. New forms of communication and policy have emerged such as cellular phones and cable telephony, as well as the introduction of the National Broadband Plan and the strong desire both nationally and in Kentucky …

The Signature Event In Curacao: A Source Of Brand Equity And Economic Significance, Manuel A. Rivera, Robertico R. Croes

Dick Pope Sr. Institute Publications

For a second year, the organizer of the Curacao North Sea Jazz Festival (CNSJF) commissioned the Dick Pope Sr. Institute for Tourism Studies (DPITS) to prepare a report on perceptions of attendees of the festival. Additionally, the project investigated the value of the event as well as the economic benefits the event brings to Curacao. A survey instrument was designed and used to assess the perceptions of perceived value of event attendees. The survey was completed during the event which was held September 2-3, 2011. A total of 400 surveys was collected and analyzed by DPITS. The survey revealed that …

The Relationship Between Electricity Prices And Electricity Demand, Economic Growth, And Employment, John Garen, Christopher Jepsen, James Saunoris

CBER Research Report

There is growing concern over the emissions of greenhouse gases in the United States. Policymakers at both the state and national levels have discussed, and in some cases enacted, policies with the goals of reducing energy demand and encouraging the use of more efficient energy technologies. Because these policies will have an effect on the cost of energy, a quantitative examination of the energy demand is warranted.

In this project, we estimate the likely effects of increased electricity prices on the demand for electricity, production as measured by Gross State Product (GSP), and employment.

Economic Impact Of Kalamazoo College, Brad R. Watts

Reports

No abstract provided.

An Economic Mirage, Ishrat Husain Dr.

Faculty Research - Newspaper and Magazine Articles

For the past several years, Pakistan remains caught in the vortex of low growth and high inflation. Its widening fiscal deficit is creating an unsustainable debt. Its surging number of unemployed remains a cause of social unrest. Its deteriorating law and order has shattered the public confidence on the state institutions and the government. To sum it up, the overall mood and sentiment in the country remains depressing. Is this state of affairs going to help the incumbent political parties at the centre and provinces? If not, why aren’t they taking the decisions that will put things right?

This disconnect …

Results And Recommendations Of Water And Wastewater Affordability Study, Ryan A. Breisach, George A. Erickcek, Brad R. Watts

Reports

No abstract provided.

A Primer On Profit Maximization, Robert Carbaugh, Tyler Prante

All Faculty Scholarship for the College of Business

Although textbooks in intermediate microeconomics and managerial economics discuss the first-order condition for profit maximization (marginal revenue equals marginal cost) for pure competition and monopoly, they tend to ignore the second-order condition (marginal cost cuts marginal revenue from below). Mathematical economics textbooks also tend to provide only tangential treatment of the necessary and sufficient conditions for profit maximization. This paper fills the void in the textbook literature by combining mathematical and graphical analysis to more fully explain the profit maximizing hypothesis under a variety of market structures and cost conditions. It is intended to be a useful primer for all …

Ce Fall 2011, Coyote Economist

Coyote Economist

Inside this Issue:

Staying Informed ....................2

We’re on Facebook .................5

Tentative Schedule ..................6

Street Food Policy In A Growing Economy: A Case Study Of Street Food Vendors In Hanoi’S Old Quarter, Alexandra J. Pill

Independent Study Project (ISP) Collection

Street food vending is a global phenomenon present in both the developed and developing worlds and it is increasingly evident as countries continue to modernize, urbanize, and globalize. Street food policy is interdisciplinary in nature, incorporating economic, social, cultural, and health dimensions in order to account for urban planning, food safety, and tourism development. In Vietnam, street food is rampant, and in particular, in Hanoi’s Old Quarter, street food vendors can be spotted on every street at all times of the day. This study explores the role of street food vendors in Hanoi's Old Quarter from the vendor’s perspective. Complementing …

The Deep Roots Of Vietnamese Tea: Culture, Production And Prospects For Development, Robert Wenner

Independent Study Project (ISP) Collection

Vietnam is at a critical stage in its development. If policy is properly managed the country’s future is incredibly bright as the middle class grows and standards of living continue to rise throughout the country. Agriculture will play a key role in future development as nearly 70 percent of the population participates directly in agricultural work. Each crop that is produced and exported in Vietnam will play a different and integral part in development as the face of agriculture changes with Vietnam’s increased global presence. This research looks specifically at tea production in Vietnam through the lens of agricultural development. …

The Economic Impact Of The Proposed Northgate Transfer Center Contruction On El Paso, Texas, Roberto Tinajero, David Ramirez, David A. Schauer

IPED Technical Reports

The Institute for Policy and Economic Development (IPED) at the University of Texas at El Paso (UTEP) was contracted by the Planning Division of City of El Paso to conduct an economic impact analysis of the proposed construction of the Northgate Transfer Center (NTC) that will accommodate a bus rapid transit system. This report is generated for the purpose of supporting a submission for funding to the U.S. Department of Transportation’s National Infrastructure Investments (TIGER Discretionary Grants). Therefore, this study quantifies the economic impacts of the proposed construction of the NTC on the County of El Paso, Texas. Specifically, this …

When It Comes To Poverty Reduction, Less May Be More, Singapore Management University

Perspectives@SMU

It is a widely accepted belief that people should be better off as the economy expands: The greater the growth, the greater the likelihood that poverty numbers will decline. While there are many good and valid reasons to hold this to be true, exceptions exist, where the lives of the poor have improved rapidly despite slow growth, or where poverty actually increases along with strong economic growth.

Watching The Clock: Challenges For The World's Fastest Growing Economies, Singapore Management University

Perspectives@SMU

Double-digit economic growths that are set to propel it to the second biggest economy in the world, overtaking Japan, has made people see China’s rise as remarkable. So confident are the pundits that they have dubbed this to be an “Asian century” and many more are urging for the world to learn Chinese in anticipation of a new world order. But, to renowned historian Wang Gungwu, this fast-paced growth associated with China is not something that is peculiar to the Asian giant only.

Ingredients For Creating And Sustaining Growth For The Long Term, Singapore Management University

Perspectives@SMU

It is easy to explain why organisations need and want to grow. This applies not only to bottom line-oriented companies, but also non-profit entities. Just like the same way business management skills can and should be applied to public sector and not-for-profit set-ups, these organisations do seek growth too. However, while it is easy to engineer short spurts of growth one way or another, what differentiates a successful organisation from one less so, is whether this organisation can sustain growth over the long-term and achieve continuous success.

Predictions For Protection: A System To Measure And Detect Asset Bubbles, Singapore Management University

Perspectives@SMU

The damage wrecked by the bursting of asset bubbles can have a devastating impact on investors' fortunes. In the Internet bubble, some US$8 trillion of shareholder wealth was destroyed. What is even more pertinent, however, is how the popping of a bubble can create a financial crisis, impacting nations and their economies. As a result, understanding how to identify bubbles is an important first step in combating these speculative bubbles, with interested parties ranging from the academic and investment community to central bankers and policy makers.

Can A Tighter Monetary Policy Actually Lead To A Higher Rate Of Inflation?, Gonzalo Moya

Economics Graduate Research Papers

No abstract provided.

Economic Empowerment And Hiv Prevention Among Young Women And Girls In Kenya: Lessons From The Study Of Economic Empowerment Programs, Samantha Van Putten

Independent Study Project (ISP) Collection

One of the major issues facing Kenya is HIV/AIDS. With recognition by the global community that providing women with economic opportunities can help both those who are HIV positive, as well as in prevention for those who are not infected, programs combining microfinance and HIV education have started to emerge. While women in these programs 3 3 have shown preliminary signs of success, young girls did not respond as well in part due to lack of interest in the particular programs themselves. As such, this study examines two economic empowerment programs for girls and young mothers at the non-governmental organization …