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Economic resilience:Measurement and assessment across time and space Research in Economics Pub Date : 2024-03-05 Jean-Paul Chavas
This paper studies economic resilience as the ability of an economic system to respond to adverse shocks. We propose several measures of resilience based on a quantile function representing income dynamics. Applied to the evolution of per capita income, we evaluate the speed and nature of economic adjustments to adverse shocks across countries over the last two centuries. We find evidence of important
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The impact of the COVID pandemic on health, healthcare utilization, and healthcare spending Research in Economics Pub Date : 2024-03-04 Nour Kattih, Fady Mansour
This study investigates the impact of the COVID pandemic on healthcare utilization, spending, and health measures among the U.S. population during the first year of the pandemic. We utilize data from the Medical Expenditure Panel Survey and employ propensity score matching techniques to analyze the variation in healthcare outcomes due to the pandemic.
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Retake opportunities, pass probabilities and preparation for exams Research in Economics Pub Date : 2024-02-06 G, i, u, s, e, p, p, e, , B, e, r, t, o, l, a
Additional retake opportunities generally increase the probability of eventually passing a given threshold at given competence, and decrease preparation for exams. Preparation work performed before the first attempt may increase only for very weak students, and may decline so much as to decrease the total pass probability only for very strong students. If additional preparation is possible before retaking
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Climate change vulnerability-foreign direct investment linkage: Why climate change preparedness matters in Sub-Saharan Africa Research in Economics Pub Date : 2024-01-25 Fisayo Fagbemi, Dorcas Funmilola Oke
The sensitivity of Foreign direct investment (FDI) inflows to the level of a region’s vulnerability to climate risks somewhat substantiates the argument that return potentials fundamentally determine FDI location decisions. This makes climate change vulnerability a great challenge to sustainable economic development efforts across the globe, particularly in developing regions. Hence, panel data of
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Informality: Family ties and retirement income Research in Economics Pub Date : 2024-01-19 Bilge Ozturk Goktuna, Renginar Dayangac
This paper suggests a demand side analysis of informal employment characterised by incompliances with labour tax regulation, using a general equilibrium model with overlapping generations. A public social insurance provides benefits to formal employees in retirement, while we allow for an informal insurance mechanism for informal employees through a social norm of mutual support. The objective of the
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Consumer energy efficiency gap and the rebound effect across households income groups Research in Economics Pub Date : 2024-01-19 A, l, i, , M, o, t, a, v, a, s, s, e, l, i
The paper sets up a model which reconciles the energy efficiency gap and the decline of the rebound effect with households’ income. It is shown that the two phenomena can be explained in a framework with a utility-maximizing household that enjoys an income-independent endowment of energy services. Energy service endowment is a barrier against the adoption of the most energy-efficient appliances and
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Hybrid role of two-sided platform with one-sided congestion Research in Economics Pub Date : 2024-01-18 Sangita Poddar, Tanmoyee Banerjee (Chatterjee)
The study investigates the hybrid role of a monopoly platform that serves as an intermediary to its two distinct sides, while also offering its own house brand products to its consumers. We attempt to understand the condition that leads a platform to prefer its own brand products over those of its rival sellers in presence of cross one-way congestion and cross-side network effects. Our model suggests
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The role of shifts in the effective tax rate on the cost of equity Research in Economics Pub Date : 2024-01-17 Javier Rojo-Suárez, Ana B. Alonso-Conde
We propose an asset pricing model conditional on the effective tax rate, which allows us to explicitly estimate the impact of shifts in corporate taxes on the expected returns of equities. We evaluate the model using Spanish macro and market data to estimate the time-varying average corporate tax rate and average returns of different anomaly portfolios. Our results show that changes in corporate taxation
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Mineral import behavior in response to shocks: A nonlinear perspective Research in Economics Pub Date : 2024-01-17 M, a, n, u, e, l, , A, ., , Z, a, m, b, r, a, n, o, -, M, o, n, s, e, r, r, a, t, e
The global economic dependence on mineral imports stands as a pivotal concern motivating this study. Given the uneven distribution of these natural resources worldwide, numerous economies have had to resort to international trade to meet their domestic demand. Despite the significance of this phenomenon, existing literature on the subject has only scratched the surface of the complexities underlying
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Intertemporal Two-stage Budgeting: Implications for Consumer Demands and Consumption Research in Economics Pub Date : 2024-01-17 H. Youn Kim, Keith R. McLaren
Consumer demands and consumption, though seemingly disjoint, are inextricably linked together via intertemporal two-stage budgeting, and cannot be separated. This paper elucidates this budgeting procedure with an illustration using the Linear Expenditure System, and evaluates the traditional analysis of consumer behavior that treats them as independent. We find that the dichotomous treatment of consumption
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Handling asymmetries in the trade balance Research in Economics Pub Date : 2023-11-21 Georgios Bertsatos, Nicholas Tsounis, George Agiomirgianakis
The existing literature in the US-Mexico trade balance reports mixed evidence on the effects of exchange rate shocks. In this paper we propose a new approach of studying exchange rate effects that allows for asymmetries in the balance of trade. Our results show that using either linear modelling or non-linear modelling and zero threshold, there is no evidence of co-integration for the US-Mexico trade
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Balancing resource relief and critical health needs through reduced-risk product transition Research in Economics Pub Date : 2023-10-05 Francesco Moscone
This paper explores regional disparities in avoidable mortalities and hospital discharges, influenced by factors associated with high-risk behaviors such as excessive alcohol consumption, smoking, and inadequate physical activity levels. We gathered data from various official sources (ISTAT and Eurostat) and conducted a comprehensive panel data regression analysis to investigate the intricate relationships
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Learning, externalities, and export dynamics: Evidence from Chilean exporters Research in Economics Pub Date : 2023-09-12 Ben Hamilton
This paper presents a model of exporting with demand uncertainty where incumbents reveal signals about a shared component of demand that potential entrants use to update beliefs. Using Chilean export data, signals are estimated and used to examine the effects of information on entry into new markets, quantity of output sold, and duration of exporting. A one-standard-deviation-increase in signals by
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Vertical fiscal externality in public education inputs: When Federal and state governments have different time perspectives Research in Economics Pub Date : 2023-09-03 Hideya Kato, Mitsuyoshi Yanagihara
This study investigates how equilibrium under a unitary nation can be achieved through fiscal transfer from (to) the federal government to (from) the state government when both levels of government supply public education to immobile residents under a simple endogenous growth framework fueled by human capital accumulation. We introduce the different time perspectives of both levels of government as
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Labor market impacts of state-level occupational licensing of undocumented immigrants Research in Economics Pub Date : 2023-08-27 Xin Brown
Since 2015, several U.S. states have begun granting professional or occupational licenses to recipients of the Deferred Action for Childhood Arrivals (DACA) program. In this study, we examine the differences in the issuance of such licenses at the state level to estimate their effect on the labor market outcomes of DACA recipients. Using data from the Current Population Survey spanning the period from
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The effects of firm performance on CEO compensation and CEO pay ratio before and during COVID-19 Research in Economics Pub Date : 2023-07-26 Ryan Ye, Yanan Chen, Kyle A. Kelly
This study analyzes the effects of firm performance on CEO compensation and CEO pay ratio (the ratio of CEO compensation and the median employee's salary) before and during the COVID-19 pandemic. Using a sample of 4410 observations from S&P 1500 firms from 2018 to 2021, we find that CEO compensation and CEO pay ratio increased during the COVID-19. Firm performance, measured by return on assets and
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Enduring lending relationships and european firms default Research in Economics Pub Date : 2023-07-22 Mariarosaria Agostino, Lucia Errico, Sandro Rondinella, Francesco Trivieri
This paper investigates the link between close banking relationships and European manufacturing firms’ defaults. Based on binary outcomes (i.e., Logit, Probit, Complementary log-log) and discrete-time models, the empirical analysis reveals that enduring lending relationships present benefits in reducing firms’ temporary and permanent defaults. This evidence suggests that, in a framework of limited
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Emotional reactions to food interventions: Evidence from an online survey Research in Economics Pub Date : 2023-07-04 Beatrice Braut, Sarah Zaccagni
We conduct an online survey to test whether interventions to foster individual motivation to eat healthy change emotional reactions to food choices. By keeping constant the change in food choice, we test if different policies evoke different emotions. The hypothetical interventions consist of a price discount or a reminder of the importance of adhering to a healthy diet. We compare the effects of the
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Middle-income trap and corruption: Evidence from a dynamic panel data analysis Research in Economics Pub Date : 2023-06-26 Joshua Ping Ang, Fang Dong
This paper empirically tests the income trap phenomenon by analyzing the convergence rate of a growth model that incorporates corruption explicitly as a rent extraction out of capital accumulation. Our model shows that the countries are ‘trapped’ in a middle-income group because they are corrupt. Since they failed to have a less corrupt economy, then they would be less productive and do not have the
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Does monetary policy really matter for environmental protection? The case of inflation targeting Research in Economics Pub Date : 2023-06-29 Christophe Martial MBASSI, Suzanne Edwige Clarisse HYOBA, Muhammad SHAHBAZ
Empirical work examining the role of monetary policy on environmental issues are rather scarce. This study examines how inflation targeting (IT) relates to environmental pollution in samples of 22 Developed Market Economies (DMEs) and 25 Emerging Market Economies (EMEs) over the period 1980–2017. Using a parametric approach (two-step system-generalized method of moments), we find that IT significantly
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Stabilization of supply shocks in a structurally heterogeneous monetary union✰ Research in Economics Pub Date : 2023-06-29 Séverine MENGUY
The paper provides accurate theoretical results regarding the consequences of heterogeneities between the preferences or between the structural parameters of the member countries of a monetary union on monetary and fiscal policies, and on the stabilization of economic activity and inflation, in case of supply shocks. Economic activity and inflation are higher (smaller) in a country affected by a positive
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Risk preferences, global market conditions and foreign debt: Is there any role for the currency composition of FX reserves? Research in Economics Pub Date : 2023-06-28 Lebogang Mateane
I estimate a transition probability matrix associated with a two-state Markov process of emerging market economies (EMEs) volatility. The different states of EMEs volatility, generate switches in central bank preferences between approximated constant relative risk aversion and increasing relative risk aversion expected utility. Therefore, I construct and propose constrained portfolio selection frameworks
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Organizational structure and technological investment revisited: An explanation based on the property rights approach Research in Economics Pub Date : 2023-06-28 Kojun Hamada
Using the property rights approach, I investigate how two vertical chains consisting of an upstream and downstream firm choose to integrate when competing in a duopoly market. This shows that whether a vertical chain chooses to integrate depends on the relative sizes of two strategic effects on quantity and investment. If the negative effect of decreasing investments is larger (smaller) than the positive
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The media coverage of antitrust enforcement: Evidence from Italy Research in Economics Pub Date : 2023-06-19 Andrea Mangani, Karina Ramazanova
This paper studies the media coverage of the antitrust proceedings completed by the Italian Antitrust Authority between 1994 and 2019. The empirical analysis considers the news on antitrust investigations published in the top Italian newspapers by circulation. The data reveal that the newspapers favor the conclusion (against the start) of proceedings, antitrust cases regarding immaterial services and
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The importance of positional mobility for regional comparisons Research in Economics Pub Date : 2023-06-03 Luis Monroy-Gómez-Franco
In this paper, I show that the decomposition of intergenerational persistence indicators into their structural and positional components offers a clearer understanding of the determinants of heterogeneity in subnational mobility rates. This constitutes a departure from the current consensus in estimating mobility rates at the subnational level in economics. Applying this approach to the Mexican case
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Financing the economy in debt times: The crucial role of public-private partnerships Research in Economics Pub Date : 2023-05-27 Isaac Amedanou
This paper aims to show that there is a great interest for countries to rely on Public-Private Partnerships (PPPs) as a tool for financing the economy, especially in times of debt. First, we conceptualize through game theory a better risk management between the public and private sectors in case of co-investment. Second, building on Iossa and Martimort (2009), we demonstrate that PPPs investments produce
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Reputation for competence in a cheap-talk setting Research in Economics Pub Date : 2023-05-20 Georgy Lukyanov
This paper develops a uniform-quadratic cheap-talk setting of Crawford add Sobel (1982), in which the sender may be uninformed and cares about his reputation for competence (that is, for being informed). We establish the existence of a partition equilibrium with two messages and show how this equilibrium is affected when we change the exogenous parameters: the sender’s bias, the initial belief that
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Machine learning and sentiment analysis: Projecting bank insolvency risk Research in Economics Pub Date : 2023-03-22 Diego Pitta de Jesus, Cássio da Nóbrega Besarria
The main motivation of this paper is to use machine learning techniques to build a new insolvency risk rating metric for banks traded on Brazilian stock exchange. Then, a set of prediction models will be used to project the risk rating of these institutions. Conventionally, the literature analyzes bank insolvency risk from accounting data and macroeconomic variables. In addition to these variables
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Effects of monetary transactions costs on economic growth Research in Economics Pub Date : 2023-03-01 Akane Watanabe, Akira Yakita
This study explores the effects of monetary transaction costs on economic growth in a closed overlapping generations economy with cash-in-advance constraints. Working generations can also hold interest-bearing capital claims. Economic growth is powered by an engine of learning-by-doing and knowledge spillover among workers. The results indicate that reductions in transaction costs raise the balanced
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Market structure and industry location in a footloose capital model Research in Economics Pub Date : 2022-11-12 Kenji Fujiwara
Comparison among Cournot, Bertrand and monopolistic competition receives recent attention in industrial organization, but not in New Economic Geography. To fulfill this gap, we examine how the difference in market structures affects industry location in a footloose capital model. We find that the home market effect is strongest in Cournot competition, second strongest in Bertrand competition, and weakest
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Analyzing the differential impacts of financial sector development on remittance inflows Research in Economics Pub Date : 2022-10-19 Chen Wu, Christian Nsiah, Bichaka Fayissa
This study investigates the financial development and remittances nexus using a panel of 84 countries at all levels of income over the 1995 to 2018 period. We employ a dynamic commonly correlated effects estimator (DCCE) for a heterogeneous panel data model with weakly exogenous regressors to investigate the impact of financial development on remittances using indices that cover all aspects of the
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Assessing the housing price capitalization of non-destructive flooding events Research in Economics Pub Date : 2022-10-19 Mitchell R. Livy
Flooding poses significant costs to communities and is expected to vary in intensity and severity in the future. Previous research has shown that major flooding events significantly affect housing markets; however, perceptions of non-destructive flooding events have not been adequately studied. In this paper, I examine the housing price capitalization of elevated river levels that did not reach the
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What drives migration to Germany? A panel data analysis Research in Economics Pub Date : 2022-10-14 J.A. Klöcker, F. Daumann
Migration has increased in many parts of the world for a variety of reasons. In our study, we examine bilateral migration flows between one country and the rest of the world. To this end, we develop a formal model that assumes rational individuals and which is partly based on insights from the micro-theory of migration. In doing so, we include human development and distinguish between regular and aysl-related
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Socio-economic and environmental factors in the global spread of COVID-19 outbreak. Research in Economics Pub Date : 2022-08-15 Tibi Didier Zoungrana,Antoine Yerbanga,Youmanli Ouoba
COVID-19 is a virus with a very fast spread rate in the world. Therefore, knowledge of factors that may explain such spread is paramount. The main objective of this research was to analyze the determinants of the virus spread worldwide. Unlike previous studies that were limited to traditional factors, this research extends the analysis to government measures (quarantine, containment, and response budget)
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Economic resilience in times of public health shock: The case of the US states. Research in Economics Pub Date : 2022-08-10 Syed Muhammad Ishraque Osman,Faridul Islam,Nazmus Sakib
Does adopting social distancing policies amid a health crisis, e.g., COVID-19, hurt economies? Using a machine learning approach at the intermediate stage, we applied a generalized synthetic control method to answer this question. We utilize state policy response differences. Cross-validation, a machine learning approach, is used to produce the "counterfactual" for adopting states-how they "would have
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COVID-19 lockdown, family migration and unemployment in a gendered society. Research in Economics Pub Date : 2022-07-28 Sushobhan Mahata,Rohan Kanti Khan,Sarbajit Chaudhuri,Ranjanendra Narayan Nag
COVID-19 has posed severe challenges not only to researchers in the field of medicines and natural sciences but also to policymakers. Almost all nations of the world lockdown have been chosen as an immediate response to this pandemic crisis. The labour market in developing economies continues to be gendered with gender-based wage differentials besides occupational segregation, women who are the marginalized
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COVID-19 and gender disparities: Labour market outcomes. Research in Economics Pub Date : 2022-07-27 Vikkram Singh,Homayoun Shirazi,Jessica Turetken
The study explores the effect of COVID-19 on labour market outcomes for women in the major urban areas in Canada. Using data from the Labour Force Statistics, we find the pandemic has had a disproportionately negative impact on the employment and income of women, worsening gender inequalities. Sectors more likely to employ women faced immense negative pressures, leading to dismal employment numbers
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Public sector efficiency in the design of a COVID fund for the euro area. Research in Economics Pub Date : 2022-07-11 Oluwanbepelumi Esther Olanubi,Sijuola Orioye Olanubi
This study examines the importance of incorporating public sector efficiency considerations in the design of a "COVID Fund" in the euro area, aimed at providing insurance for member states against common health shocks. To test our proposition, we examine the efficiency of government spending on health during periods of severe resource constraints, which mirrors what occurs during pandemics like COVID-19
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Food consumption changes during 2020 lockdown in Italy. Research in Economics Pub Date : 2022-07-02 Beatrice Braut,Matteo Migheli,Elisa Truant
The lockdown imposed to limit the diffusion of COVID-19 in Italy affected the economic situation negatively. The income of many households decreased, and people were forced to stay home. Both these factors influenced food consumption: on the one hand less income means less money for purchases, on the other, the negative psychological impact of lesser income and the pandemic shifted the consumption
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Non-pharmaceutical interventions and mortality in U.S. cities during the great influenza pandemic, 1918-1919. Research in Economics Pub Date : 2022-06-25 Robert J Barro
A key issue for the ongoing COVID-19 pandemic is whether non-pharmaceutical public-health interventions (NPIs) retard death rates. Good information about causal effects from NPIs comes from flu-related excess deaths in large U.S. cities during the second wave of the Great Influenza Pandemic, September 1918-February 1919. The measured NPIs are in three categories: school closings, prohibitions of public
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Identity and learning: A study on the effect of student-teacher gender matching on learning outcomes Research in Economics Pub Date : 2022-03-01 Sukanta Bhattacharya,Aparajita Dasgupta,Kumarjit Mandal,Anirban Mukherjee
In this paper we examine whether students' and teachers' identity play any role in the learning outcome of students. Specifically, we ask if a student benefits by learning from a teacher of her same gender. Unlike the existing literature which explains such interaction through role model effect or Pygmalion effect, we explain such interaction in terms of gender based sorting behaviour across private
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Characterization of a second-best rationalizable choice function with full domain Research in Economics Pub Date : 2022-03-01 Taposik Banerjee
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Emission taxation, green innovations and inverted-U aggregate R&D efforts in a linear state differential game Research in Economics Pub Date : 2022-03-01 Davide Dragone,Luca Lambertini,Arsen Palestini
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A $15 federal minimum wage is outside historical experience Research in Economics Pub Date : 2022-03-01 Ian Fillmore
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Demographic change and economic growth: The role of natural resources in the MENA region Research in Economics Pub Date : 2022-03-01 Efstathios Polyzos,Simon Kuck,Khadija Abdulrahman
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Identity and learning: A study on the effect of student-teacher gender matching on learning outcomes Research in Economics Pub Date : 2022-03-01 Sukanta Bhattacharya,Aparajita Dasgupta,Kumarjit Mandal,Anirban Mukherjee
In this paper we examine whether students' and teachers' identity play any role in the learning outcome of students. Specifically, we ask if a student benefits by learning from a teacher of her same gender. Unlike the existing literature which explains such interaction through role model effect or Pygmalion effect, we explain such interaction in terms of gender based sorting behaviour across private
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Emission taxation, green innovations and inverted-U aggregate R&D efforts in a linear state differential game Research in Economics Pub Date : 2022-03-01 Davide Dragone,Luca Lambertini,Arsen Palestini
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Characterization of a second-best rationalizable choice function with full domain Research in Economics Pub Date : 2022-03-01 Taposik Banerjee
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Price and information disclosure in the private art market: A signalling game Research in Economics Pub Date : 2022-03-01 Francesco Angelini,Massimiliano Castellani
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Inequality within generation: Evidence from France Research in Economics Pub Date : 2022-03-01 Hippolyte d'Albis,Ikpidi Badji
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Macroeconomics of the Great Influenza Pandemic, 1918-1920. Research in Economics Pub Date : 2022-01-21 Robert J Barro,José F Ursúa
Data for 48 countries during the Great Influenza Pandemic imply flu-related deaths in 1918-1920 of 40 million, 2.1 percent of world population, implying 160 million deaths when applied to current population. Regressions with annual information on flu deaths 1918-1920 and war deaths during WWI imply flu-generated economic declines for GDP and consumption in the typical country of 6 and 8 percent, respectively
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Restricting entry without aggressive pricing Research in Economics Pub Date : 2021-12-01 Martin Alfaro,David Lander
Abstract This paper studies a strategic-investment model under endogenous entry of followers. We extend the standard setting a la Etro by incorporating multiple heterogeneous leaders and demand-enhancing investments directly affecting competition. Our findings indicate that all leaders simultaneously restrict entry without harming each other. Moreover, while entry accommodation never arises, a wide
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The economics of posted prices in a concentrated market where demand is uncertain Research in Economics Pub Date : 2021-12-01 Edmund H. Mantell
ABSTRACT This paper analyses the theory of the optimal output decision for a firm whose policy is to post a non-negotiable price for a good or service in a concentrated market where the demand facing the firm is determined, in part, by a random variable. The theoretical findings are the opposite of those in competitive markets; Proposition 1 states that the optimal output of a risk-averse firm is expected
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Team reasoning without a hive mind Research in Economics Pub Date : 2021-12-01 Mantas Radzvilas,Jurgis Karpus
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The effect of luck framing on distributional preferences Research in Economics Pub Date : 2021-12-01 Antonio Carlos Mercer,Angela Cristiane Santos Póvoa,Wesley Pech
Abstract This paper experimentally investigated luck framing. Specifically, we analyzed the difference between being assigned an advantageous role in a distribution game and being assigned the same role while being explicitly told that you were lucky to be in that favorable position. We tested this difference by implementing a dictator game and a no-veto-cost ultimatum game. We observed that: a) dictators
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Exploring what stock markets tell us about GDP in theory and practice Research in Economics Pub Date : 2021-12-01 Christopher Ball,Jack French
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More and none? Children and parental well-being: A bimodal outcome from an instrumental variable approach Research in Economics Pub Date : 2021-09-01 Stefani Milovanska-Farrington,Stephen Farrington
Abstract We examine the effect of the marginal child and the total number of children on self-reported well-being as a proxy for happiness. Prior literature has not controlled for endogeneity. We propose an instrumental variable approach which remediates the existing endogeneity problem, and generates a non-linear marginal effect and a bimodal distribution which explains why prior research arrived
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Financial advice: Who Exactly Follows It? Research in Economics Pub Date : 2021-09-01 Liron Reiter-Gavish,Mahmoud Qadan,Joseph Yagil
Abstract Using data from about 290,000 household investment accounts, we provide a comprehensive analysis of the role of personal economic and demographic characteristics in determining the tendency to utilize financial advice. Our findings indicate that investors' sophistication level, captured using several proxies, is negatively correlated with the decision to follow the financial advice received