Economics Commons^™

Robust Determinants Of Bilateral Trade, Marianne Baxter, Jonathan Hersh

Economics Faculty Articles and Research

What are the policies and country-level conditions which best explain bilateral trade flows between countries? As databases expand, an increasing number of possible explanatory variables are proposed that influence bilateral trade without a clear indication of which variables are robustly important across contexts, time periods, and which are not sensitive to inclusion of other control variables. To shed light on this problem, we apply three model selection methods – Lasso reguarlized regression, Bayesian Model Averaging, and Extreme Bound Analysis -- to candidate variables in a gravity models of trade. Using a panel of 198 countries covering the years 1970 to …

Bringing A New Perspective On Co-Movements Of Stock Markets In Emerging Economies Through Causality And Wavelet Analysis, Sadullah Çelik, Emel Baydan

Topics in Middle Eastern and North African Economies

The recent global financial (and economic) crisis has validated the need to assess the financial sector of the economies with rather unconventional approaches. Believing that financial markets use all the available information in an efficient manner is as questionable as finding models which test the existence of bubbles in stock exchange markets. In this respect, this paper tries to introduce a different perspective by attempting to examine the role of emerging markets in this turmoil period, termed the Great Recession. We are intrigued by the argument that stock exchange markets in emerging economies have been affected in an asymmetric manner. …

Sensitivity Of Turkish Income Distributions To Choice Of Equivalence Scale, Sinem Sefil

Topics in Middle Eastern and North African Economies

Income surveys are typically designed to collect income data on the household level. In order to obtain reliable outcomes from income distribution and inequality analysis, it is of crucial importance to consider households’ composition and varying needs. Relying on data from Turkey’s 2009-2011 Income and Living Conditions Survey (SILC), this paper examines the GE class inequality indices and Gini coefficient in terms of their sensitivity to choice of equivalence scales. It uses both one-parameter and two-parameter parametric equivalence scales to capture the effects of household size and decomposition. Following Coulter et al. (1992a), this study tests the sensitivity of the …

Self-Employment And Unemployment In Turkey, Yasemin Ozerkek, Fatma Dogruel

Topics in Middle Eastern and North African Economies

The relationship between the rates of self-employment and unemployment has been extensively studied in the literature. The results of the existing studies are varied. The aim of this paper is to investigate the dynamic relationship between these variables in Turkey. The results indicate that there is a long-run relationship between the rates of self-employment and unemployment. Changes in self-employment rates have a negative effect on subsequent unemployment rates. There is evidence for the existence of causality running from self-employment rate to unemployment rate. The results reveal the existence of an entrepreneurial effect. However, it is not possible to assess the …

The Impact Of Standards On Egyptian Trade: Evidence From Sps Measures, Hoda El-Enbaby, Rana Hendy, Chahir Zaki

Topics in Middle Eastern and North African Economies

According to the World Trade Organization (WTO) standards, countries are allowed to adapt regulations under the Sanitary and Phyto-Sanitary (SPS) and Technical Barriers to Trade (TBT) agreements in order to protect human, animal and plant health as well as environment and human safety. Therefore, using an Egyptian firm-level dataset, we analyze the effects of product standards on exports. We merge this dataset with a new database on specific trade concerns raised in the TBT and SPS committees at the WTO. Our main findings show that SPS measures imposed on Egyptian exporters have a negative impact on the probability of exporting …

The Determinants Of Broadband Access And Usage In Turkey: Do Regions Matter?, Emin Köksal, Bülent Anil

Topics in Middle Eastern and North African Economies

The aim of the paper is to examine the determinants of broadband internet access in Turkey, and in particular, whether the probability of adopting broadband access varies by region. This study also attempts to find out whether there are regional disparities in engaging in various online activities. The 2012 ICT Household Survey that was conducted and administered by TURKSTAT is used. Probit model of probability of adopting broadband access is estimated and results are consistent with the earlier studies: Education, gender, age and household size matter. Besides this, the probability of adoption in West and Central Turkey is higher than …

Examining The Effect Of Religion On Economic Growth: A Partial Replication And Extension, Sophia M. Korman

Honors Theses, 1963-2015

Economic growth is the fundamental measurement that assesses a country’s productive capacity in terms of goods and services. It is conventionally estimated using the percent rate of increase in GDP per capita and is correlated with numerous factors in society, among which include quality of life. For example, one application of GDP per capita is as a primary indicator of standard of living. However, although GDP per capita is a reliable determinant of the level of development in a country, it is certainly not the only way to measure well-being. For instance, it fails to capture many important aspects of …

The Influence Of Economic Performance In The 2014 Midterms: A Gubernatorial Tutorial, Justin M. Markon

Honors Theses, 1963-2015

Who is responsible for the state economy, and does it matter in electing the state chief executive? Until now, numerous researchers have examined the influence of the economy and other factors in gubernatorial elections. However, the most recent studies at the state level did not include economic conditions or found them to be insignificant. This project will examine the thirty-six gubernatorial elections in 2014 and analyze both national- and state-level economic indicators. After investigating the economic performance factors in relation to the election results, it appears that economic conditions did not influence vote choice in the November 2014 gubernatorial elections, …

Investment Performance Of Common Stock In Relation To Their Price-Earnings Ratios: Basu 1977 Extended Analysis, Jordan R. Tilley

All Graduate Plan B and other Reports, Spring 1920 to Spring 2023

In this study, the work of Basu 1977 is partly replicated using subsequent market data. A trading strategy of investing in assets based on their price-earnings ratio is back-tested, thus also testing the efficient market hypothesis. Market data over the past twenty-five years (1989-2014) was gathered, cleaned, and modeled to test for unexplained return to five portfolios ranked by PE ratio. The data was tested using the single-factor Capital Asset Pricing Model and the Fama-French three-factor model. The dataset was then decomposed by price and similarly modeled to test whether the effectiveness of using PE as a leading indicator is …

Contracts And Trust, Bryan C. Mccannon, Colleen Tokar Assad, Mark Wilson

Economics Faculty Working Papers Series

Social preferences and third-party enforcement of formal contracts are two mechanisms that facilitate performance of an agreement. The standard argument is that formal contracting substitutes when social preferences are lacking. We explore the hypothesis that social preferences and contract enforcement are complements. We measure social preferences from a Trust Game and use it is an explanatory variable in a contract game. We find that both increased contract enforcement and high trusting preferences lead to enhanced rates of contract formation and larger investments. There is an interaction effect where trusting individuals make larger investment agreements, specifically when enforcement is greater. Thus, …

Diplomatic Normalization Between The Us And Cuba In Light Of Recent Changes In Us Foreign Policy More Generally, Ethan Zawatsky, Ashley Gemma

Senior Honors Projects

We analyze normalization of diplomatic relations between the US and Cuba. We first examine the causes of previous normalizations with Vietnam and China. From these cases, we identify factors that are key to the normalization process. These include political turnover, economic interests, other special interest groups, public sentiment, and what we refer to as the Lawnmower Effect. This effect is observed when one or both nations attempt to reopen diplomatic ties only to continually fail to establish relations due to the endurance of underlying political issues. We use the Multiple Streams Framework (a policy formulation theory) in order to evaluate …

Rush To Judgment: The Sti-Treatment Trials And Hiv In Sub-Saharan Africa, Eileen Stillwaggon, Larry Sawers

Economics Faculty Publications

Introduction: The extraordinarily high incidence of HIV in sub-Saharan Africa led to the search for cofactor infections that could explain the high rates of transmission in the region. Genital inflammation and lesions caused by sexually transmitted infections (STIs) were a probable mechanism, and numerous observational studies indicated several STI cofactors. Nine out of the ten randomized controlled trials (RCTs), however, failed to demonstrate that treating STIs could lower HIV incidence. We evaluate all 10 trials to determine if their design permits the conclusion, widely believed, that STI treatment is ineffective in reducing HIV incidence.

Discussion: Examination of the …

The Idiosyncratic Volatility Puzzle: A Behavioral Explanation, Brad Cannon

All Graduate Plan B and other Reports, Spring 1920 to Spring 2023

The trade-off between risk and return is a fundamental principle in finance. In any finance class, one will likely hear the phrase, “the greater the risk, the greater the return.” The Capital Asset Pricing Model (CAPM), one of the most basic and well-known finance models, estimates the expected return of an asset assuming a positive relation between expected return and a single risk factor. Empirically, risk control variables such as the CAPM beta along with other risk factors associated with market cap, book-to-market ratio, and illiquidity are used when pricing assets. Finance is abundant in theories all supporting positive risk-return …

Making Connections: How Do Immigrants' Social Networks Influence Their Employment Outcomes?, Charmaine S. Runes

Economics Honors Projects

This paper examines the relationship between the size of local ethnic networks and immigrants’ likelihood of being self-employed in 11 metropolitan areas in the U.S. I use American Community Survey data from 2005 to 2011. A two-stage discrete choice logistic specification models agents’ decisions to have a job or not, and if so, to work for wages or be self-employed. Generally, the likelihood of being self-employed decreases with network size, but the opposite holds true for salaried employment. I also interview self-employed Hmong in Saint Paul to explore the effect immigrants’ attitudes toward different employment options have on their work …

Factors Affecting Child Mortality, Lisa Wheatley

Honors Theses

This study examines the factors that contribute to the rate of child mortality within a country. Through regression analysis, this model attempts to explain the rate of child mortality for a country as a function of factors including the adult female literacy rate, fertility rates, adult female labor force participation, rate of immunization for tuberculosis, access to safe water, income per capita, and prevalence of human immunodeficiency virus. This paper surveys a range of low-income countries from different regions including Sub-Saharan Africa, Middle East and North Africa, East Asia and the Pacific, Europe and Central Asia, South Asia, and Latin …

Faith-Based Organizations In Disaster Relief: Locally-Based Strategies For A Higher Demand Future, Zach Goldberg

Renée Crown University Honors Thesis Projects - All

Due to the effects of climate change, natural disasters are beginning to occur more frequently and are causing greater destruction. The American disaster relief system currently relies on a nationally focused, top-down approach. As resources become more and more limited, it is expected that disaster relief fatigue will occur, required local communities to take a larger role in their disaster relief processes. Right now, major player in both local and national disaster relief are Faith-Based Organizations (FBOs), who provide many crucial services before and after disasters

This paper develops an economic model of the rebuilding stage of disaster relief in …

Planet Of The Celtic Tiger, Alexid Wai Kit Lam

Renée Crown University Honors Thesis Projects - All

Due to the vast developments in technology and information sharing, developing countries now have instant access to a library full of articles documenting the growth of various developed countries in the world. As these countries are searching for an economic model and hoping to replicate its result, they often come across Ireland’s economic success during the Celtic Tiger times. During this period, Ireland transformed from the “poorest of the rich” to “one of Europe’s shining lights.” Although Ireland's economic growth seems extremely appealing, how likely is it that another country could follow Ireland’s success by adopting its economic approach?

This …

An Indentured Generation? The Effect Of Student Debt On Entrepreneurship In The United States, Lidia P. Medina

Renée Crown University Honors Thesis Projects - All

This paper discusses the topical issue of rising student debt and the effect it has on employment decisions, particularly entrepreneurship. This paper aims to analyze this relationship using labor economic theories on investing and saving, labor decisions and risk aversion. Additionally, it discusses the role of entrepreneurship on economic growth and globalization using both historical and present-day data gathered from the National Longitudinal Survey of Youth (1997—2011), The Kauffman Research Center, and the US Department of Education.

A New Approach To Measuring Poverty In The United States: A Household's Ability To Consume, David Ashelman

Applied Economics Theses

The definition of poverty is a social construct. As such, quantitatively measuring poverty is problematic, and creates ineffective poverty-alleviation policy. This thesis examines the historical measure of poverty in the United States, compares U.S. poverty measurements to Great Britain and Canada, and then proposes a new way to measure poverty. Instead of measuring income as the defining factor of poverty, the new poverty measurement suggested eliminates income factors and focuses on a household’s ability to consume in a non-comparative manner. When quantifying a household’s ability to consume, implications arise in economic policy for anti-poverty programs, defining the middle class, minimum …

Economic Growth And Development In Sub-Saharan Africa, Asia, And Latin America: The Impact Of Human Capital, Angui D. Macham

Applied Economics Theses

My thesis is that human capital has been important to growth, but has had differential impact in three areas: Sub-Sahara Africa; Asia; and Latin America. I estimated three regional models to determine the impact of human capital on the growth of gross domestic product (GDP) per capita. Each model was estimated using the pooled OLS approach with a sample of 10 countries within each region. I make use of data from the Penn World Table- international comparisons of production data bank. I found that only the African region had statistically significant coefficients for both physical and human capital. For the …

The Optimum Currency Area Theory: An Analysis Of The Pacific Alliance, Andres Mira

HIM 1990-2015

This thesis is intended to consider whether the South American members of the trade bloc, the Pacific Alliance, namely Chile, Colombia, Peru, form an optimum currency area (OCA). An in-depth review into the progression of OCA theory is done to formulate a proper econometric analysis. An empirical investigation is conducted by using main macroeconomic indicators from the time period 2001 to the third quarter of 2014 to examine if the aforementioned countries are within the definition of an OCA. An ordinary least squares regression is done on three major economic indicators to test the causes of the deviation from one …

How Behavioral Factors Are Being Implemented Into Today's Financial Education Programs, Esperanza Perez

HIM 1990-2015

This research examined 50 financial education programs within the state of Florida. The purpose of the research was to survey financial education program providers to see how they are evolving to meet the sociological, psychological and behavioral factors that affect individual’s financial decision making. In constructing the survey I referenced articles, journals and publications regarding how certain factors can affect an individual and their ability to apply financial education to their daily life. This review of previous research showed that tailored education, to determine a participant’s means, ability and goals, is the best way to help participants achieve financial independence. …

Macroeconomic Indicators As Determinants Of The U.S. Dollar As A Primary Reserve Currency, Joel Salgado

HIM 1990-2015

Several currencies have arisen as credible competitors for the dollar's primary reserve currency position in central banks around the globe, and many wonder how long the dollar can maintain its position. Reserve currency usage is dependent relative to the size of the home economy, openness to trade, and prosperous and stable growth, including an inertial bias. This paper utilizes econometric methods to examine the significance of macroeconomic indicators of the U.S. dollar’s reserve currency status. The dataset is gathered from the IMF's COFER database using a time period from 2000 to 2013 in order to capture the most relevant reserve …

High And Dry: An Economic Analysis Of Drug Use In Dry Counties, Shannon Harris

Economics Undergraduate Honors Theses

This paper focuses on how alcohol prohibition affects the drug seeking behaviors of citizens in dry counties. Dry counties are counties that do not permit the production or sale of alcohol and are typically found in Southern states only. This paper analyzes the relationship between dry county laws and three different drug incident measures in order to get a better picture of the unintended consequences of modern alcohol prohibition in the states of Alabama, Arkansas and Kentucky. To estimate drug related events I used the seizure of production sites used to make methamphetamine and other synthetic drugs, as reported by …

Community Development In Mozambique: Evaluating Impact Assessment Methodologies, Carol Ann Farmer

Economics Undergraduate Honors Theses

This paper is an analysis of an impact assessment conducted by University of Arkansas students and finalized by Abby Davidson during the 2014 Community Development in Mozambique study abroad program. The assessment was based on a developmental poultry organization in the Nampula region. In order to evaluation the assessment several theories of impact assessment were utilized. Construction of a proper counterfactual, the mitigation of selection bias, appropriateness of impact indicators, and validity were all used to consider the methodologies employed in the aforementioned assessment. Based on these criteria it was found that The Impact of poultry in Northern Mozambique failed …

Inflation Targeting And Dollarization In Bolivia, Hugo Vaca Pereira Rocha

Economics Undergraduate Honors Theses

This thesis attempts to test the effectiveness of the IT regime as a nominal anchor (reference for monetary policy) to the Bolivian Central Bank through the use of the Taylor rule. In order to use the Taylor Rule, it will be necessary to collect data from the monetary aggregates, interest rates (preferably US interest rates since the boliviano is pegged to the US dollar), and Bolivian Central Bank international reserves. Depending upon the results of the coefficients found it would be possible to make some initial conclusions. The reason why this amount of data will be required is that this …

Going Beyond The ‘New Normal’ In Indonesia, Mari Pangestu, Philip Charles Zerrillo

Asian Management Insights

The Republic of Indonesia’s former Minister of Trade and former Minister of Tourism and Creative Economy, Professor Mari Pangestu, talks about the country’s resilience, and going beyond the ‘new normal’, in this interview with Philip Zerrillo.

The Philippines Growth Story: Ground Realities Of Asean Integration, Bernardo M. Villegas

Asian Management Insights

Open policies, an attractive workforce and new market potential in the Philippines– all suggest a ‘take-off’ is underway.

Foreign Investors Are Finding Vietnam Increasingly Attractive, Tony Diep, Hawkins Pham

Asian Management Insights

A new wave of mergers and acquisitions and foreign direct investments is coming into Vietnam thanks to macro stability, an emerging middle class and changes in Asia’s manufacturing landscape.

The Past And The Hopeful Future Of Vietnam’S Economy, Le Dang Doanh

Asian Management Insights

Reform and integration are key for tapping Vietnam’s economic potential.