-
Informational rents and the excessive entry theorem: The case of hidden action* Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-12-25 Marco de Pinto, Laszlo Goerke, Alberto Palermo
Entry in a homogeneous Cournot-oligopoly is excessive if there is business-stealing. These findings assume that production costs reduce profits and welfare equally. If firms pay informational rents due to frictions in the employer–employee relationship, production costs partly reflect transfers, which do not alter welfare directly. We investigate the excessive entry theorem in the presence of rents
-
Forms of fiscal governance in the Euro Area – An update Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-11-20 Moira Catania, Mark Baimbridge, Ioannis Litsios
Despite the common Euro Area (EA) requirements, we find notable differences in the quality of fiscal governance among the 19 member states. Moreover, characteristics of the delegation approach, which have been largely ignored in the EA fiscal governance framework, remain important in various member states. Using a two-way fixed effects panel data model for the EA countries during 2006–2018, we find
-
Special ones? The effect of head coaches on football team performance Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-11-12 Alex Bryson, Babatunde Buraimo, Alex Farnell, Rob Simmons
Using data from professional football leagues in four countries, we assess the effects on team performances following head coach turnover, distinguishing between voluntary and involuntary exits. We use entropy balancing to deal with the endogeneity of coach departures, by reweighting pre-departure covariates to obtain a comparable control group. Results reveal little, if any, positive effect from either
-
Language diversity, gender inequality, and aggregate productivity in Canada Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-11-12 Kanat Abdulla
Identifying sources of barriers to occupational mobility is central to evaluating the efficiency of the labor market. In this paper, we present an augmented Roy model in which workers self-select into occupations, subject to labor market barriers that are specific to their socio-linguistic group. Our findings provide evidence of differences in labor market outcomes across gender and linguistic groups
-
Lightening the path to financial development: The power of electricity Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-11-10 Lei Pan, Richard Adjei Dwumfour, Veasna Kheng
This paper examines the impact of access to electricity on financial development. In doing so, we use a number of instrumental variables (IV) approaches. Using panel data for 38 countries in Sub-Saharan Africa over the period 2000–2018, the results suggest that more people having access to electricity can promote financial development. In addition, mobile phone and commercial bank branches diffusion
-
Life satisfaction and unemployment—The role of gender attitudes and work identity Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-10-20 Simonetta Longhi, Alita Nandi, Mark Bryan, Sara Connolly, Cigdem Gedikli
Unemployment has a strong negative effect on subjective well-being, but the effect varies across groups. Using an event study approach, we explore the sources of heterogeneity in the effect of the transition into unemployment on life satisfaction, focusing on work identity and gender role attitudes. All experience a loss of life satisfaction when they become unemployed, but we find greater heterogeneity
-
A note of caution on the relation between money growth and inflation Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-09-08 Helge Berger, Sune Karlsson, Pär Österholm
We assess the bivariate relation between money growth and inflation in the euro area and the United States using hybrid time-varying parameter Bayesian VAR models. Model selection based on marginal likelihoods suggests that the relation is statistically unstable across time in both regions. The effect of money growth on inflation weakened notably after the 1980s before strengthening after 2020. There
-
Optimal fiscal policy under monopolistic competition with firm heterogeneity Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-08-29 Cheng-wei Chang
Government spending is a policy instrument used to sustain economic development and improve social welfare. Empirical observations, however, reveal a significant decrease in the government spending to GDP ratio for the United States. In addition, the United States has been observed to exhibit a rise in firm heterogeneity in productivity in recent decades. This paper shows that the optimal size of government
-
Income taxation and progressivity: A measure of equitability Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-08-23 John Creedy, S. Subramanian
This paper proposes a measure of ‘equitability of taxation’, in the context of progressivity and the income tax. By postulating specifications of ‘extreme equitability’ and ‘extreme inequitability’ of a tax system, the paper advances a measure of tax equitability as the normalised area distance of a ‘tax concentration curve’ from its most inequitable version. The measure is derived, and a procedure
-
A tale of two taxes: State-dependency of tax policy Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-07-31 Kerim Peren Arin, Emin Gahramanov, Tolga Omay, Xueli Tang, Mehmet A. Ulubasoglu
In this paper, we build a simple endogenous growth model with labour and corporate taxes to investigate the asymmetric effects of tax policy over the growth trajectory. We employ a newly developed panel smooth transition model to empirically analyse a sample of 19 advanced economies over the 1961–2017 period. We find that both the asymmetric effects and the tax measures used are essential. We also
-
Interim performance information and risk taking in a tournament—Field evidence from professional basketball Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-07-25 Wen-Jhan Jane
This paper examines whether the shooting decisions under the leading (/lagging) condition moderate (/stimulate) risk taking. Using the task of field goal attempts in basketball competitions involving National Basketball Association regular season and playoff games, I find strong evidence of a significantly causal effect of interim performance information (IPI) on the probability of a risky shooting
-
Fiscal crises, decentralization, and indiscipline Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-07-25 Ryota Nakatani
How does fiscal decentralization influence fiscal discipline and the probability of a fiscal crisis? Discrete choice analysis used with panel data reveals that crisis probability is associated positively with spending decentralization and negatively with vertical fiscal imbalance. These effects are prevalent in countries with a higher degree of tax revenue decentralization, while a stronger rule of
-
Judicial efficiency and economic growth: Evidence based on European Union data Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-07-19 Panayotis Kapopoulos, Anastasios Rizos
We investigate the effects of judicial efficiency on economic growth using a new dataset over the period 2010–2018 drawn by the European Union Justice Scoreboard. To do so, we estimate a growth equation controlling for alternative de facto judicial efficiency indicators. Our findings suggest that operational inefficiencies of judicial systems undermine economic growth, weakening its capability to safeguard
-
The geopolitical risk spillovers across BRICS countries: A quantile frequency connectedness approach Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-06-26 Duc Hong Vo, Tam Hoang-Nhat Dang
This paper investigates the geopolitical risk spillovers among BRICS countries during the 1985–2022 period. We adopt the novel quantile frequency connectedness approach, which allows us to examine the risk transmission by frequency and quantile. The geopolitical risks spread more intensely among BRICS countries during extreme circumstances. The long-term geopolitical risk spillovers are the main contributors
-
Social externalities of women empowerment: Evidence from suffrage movements of late nineteenth and early twentieth century United States Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-06-11 Hamid Noghanibehambari, Farzaneh Noghani, Nahid Tavassoli
Previous literature suggests that empowering women is associated with children's improved outcomes. However, little is known about its effects on children's later-life crime and incarceration. We argue that women empowerment through suffrage law changes during the late nineteenth and early twentieth centuries in the US generated incentives for women to invest in their children's human capital. The
-
Lobbying and innovation in the European Union Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-06-09 Konstantinos Dellis
Aside from anecdotal evidence, lobbying activities and the role of vested interests in the EU have not been scrutinized. This article attempts to cast focus on the relationship between lobbying and aspects of innovation in the EU. The modest performance of the EU compared to the innovation frontier has been attributed to an array of factors, one of which is the adverse effect of vested interests. The
-
The role of liquidity in monetary policy transmission: Evidence from Indian banks1 Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-05-29 Md Gyasuddin Ansari, Rudra Sensarma
The role of bank liquidity in monetary policy transmission has received insufficient attention in the literature. Faced with monetary tightening, banks with more liquidity can sell off securities and protect their loan portfolios. We test this proposition using panel data for Indian banks during 2005–2020. Employing dynamic threshold panel regressions with liquid assets as the threshold variable, we
-
Edgeworth's taxation paradox when firms engage in cost-reducing investment Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-05-25 Kojun Hamada, Takao Ohkawa, Makoto Okamura
This study examines whether and when Edgeworth's taxation paradox, that taxation decreases the equilibrium price, occurs in a free-entry Cournot oligopoly with cost-reducing investment. In contrast to the fact that no paradox occurs in the short-run equilibrium, the paradox can occur in the long-run equilibrium, in which the number of firms is endogenous. However, the conditions under which the paradox
-
Technology adoption in autocratic economies: The role of fiscal capacity Scottish Journal of Political Economy (IF 0.913) Pub Date : 2023-05-25 Thorsten Janus
What determines technology in autocratic regimes? In this paper, I assume that a rent-extracting regime can adopt technology from the global technology frontier, tax-paying citizens can oust the regime, and technology can decrease the ousting cost. I show that a lack of fiscal capacity can increase technology by preventing the ousting constraint from binding. Consistent with this prediction, tax collections
-
Armed conflicts and women's authority in intra-household decision making Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-12-27 Kien Le, My Nguyen
This paper evaluates the extent to which armed conflicts alter women's intra-household decision making in 51 countries over the past three decades (1990–2018). Exploiting the variations both within and across districts in the timing of battles, we uncover adverse consequences of armed conflict on women's engagement in household decisions on both financial and non-financial aspects. Specifically, a
-
Shadow rates as a measure of the monetary policy stance: Some international evidence Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-12-21 Christina Anderl, Guglielmo Maria Caporale
This paper examines the usefulness of shadow rates to measure the monetary policy stance by comparing them to the official policy rates and those implied by three types of Taylor rules in both inflation-targeting countries (the UK, Canada, Australia and New Zealand) and others that have only targeted inflation at times (the United States, Japan, the Euro Area and Switzerland) over the period from the
-
Political regimes and financial crises Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-11-09 Rashad Hasanov, Prasad Sankar Bhattacharya
This study investigates how democratic or autocratic regimes, their transitions, and durations, affect the probability of experiencing financial crises. The empirical strategy employs novel instruments and Lewbel's method to address potential endogeneity concerns. The results reveal that democratic transition reduces the probability of crises by around seven percent, whereas autocratic switchovers
-
Biased managers with network externalities Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-10-22 Kangsik Choi, DongJoon Lee, Ki-Dong Lee
In network industry under Cournot and Bertrand competition, we examine a model when owners of firms hire biased managers who have incorrect market demand. Contrast to previous studies, we show that (i) regardless of the strength of network externalities when consumers form the responsive and passive expectations, owners realize strategic advantage by hiring biased managers to be more aggressive under
-
On competitive balance in the group stage of the UEFA Champions League* Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-09-01 Francisco Triguero-Ruiz, Antonio Avila-Cano
This article examines competitive balance in the group stage of the UEFA Champions League over the last two decades (1999/2000–2017/2018). Competitive balance is considered both before and after a competition. Have the groups been designed in such a way as to ensure similar levels of competitive balance ex ante? Have the demonstrated strengths (ex post competitive balance) of the different groups been
-
Lobbying, political competition and the welfare effect of campaign contribution tax Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-08-13 Thanh Le, Erkan Yalcin
This paper develops a probabilistic voting model in which a single lobby group commits campaign contributions to parties, contingent on the policy position the party adopts. Parties may have different propensities for diverting campaign funds towards rents. We show that a party that skims more from contributions mobilises fewer uninformed voters but places more value on receiving greater contributions
-
A model of police financing through income and consumption taxes Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-08-13 Weiguang Deng, Xue Li, Zijun Luo
This article studies police financing with a focus on the difference in the timing between federal and local government funds. In general, federal government funds came from income taxes collected before possible appropriative activities while local government funds came from consumption taxes collected afterwards. We find that income-tax financing results in more workers, more police, and fewer thieves
-
Does possessing an installed base induce a proprietary software producer to act aggressively or mildly in pricing and intrinsic quality provision? Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-07-27 Chung-Hui Chou
This paper investigates competition between open-source software (OSS) and proprietary software (PS) which possesses an installed base. We find that an increase in PS installed base does not necessarily induce the PS producer to increase price or reduce intrinsic quality. Specifically, if OSS is weakly (moderately) compatible with PS, then an increase in PS installed base induces the PS producer to
-
University attendance and academic performance: Encouraging student engagement Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-07-20 Siobhan Lucey, Maria Grydaki
Absenteeism in higher education has motivated the investigation of its effect on academic performance. This paper examines the effect of implementing an incentive scheme on seminar PPA (prior preparation and attendance) and performance focusing on a cohort of international postgraduate students over two academic years in two conversion economics (quantitative and non-quantitative) modules at a Scottish
-
Financial globalization and wage inequality Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-07-17 Jiancai Pi, Kaiqi Zhang, Xiangyu Huang
This paper analyzes how financial globalization affects skilled-unskilled wage inequality. We treat financial globalization as more regions being integrated into the global financial market. We find that a higher degree of financial globalization will decrease skilled-unskilled wage inequality if it induces a small increase in the capital tax rate. However, a higher degree of financial globalization
-
Public sentiment towards economic sanctions in the Russia–Ukraine war Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-07-16 Vu M. Ngo, Toan L. D. Huynh, Phuc V. Nguyen, Huan H. Nguyen
This paper introduces novel data on public sentiment towards economic sanctions based on nearly 1 million social media posts in 108 countries during the Russia–Ukraine war by using machine learning. We show the geographical heterogeneity between government stances and public sentiment. Finally, we show how political regimes, trading relationships and political instability can predict how people perceive
-
Works council ‘disaffection’ and establishment survivability Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-07-06 John T. Addison, Paulino Teixeira, Philipp Grunau, Lutz Bellmann
This article investigates the association between a measure of works council heterogeneity and plant closings in Germany, 2006–2015. Two datasets are used to identify failed establishments, while institutional heterogeneity is captured by management perceptions of the role of the works council in managerial decision making and also by allowing for works council learning. The potential moderating role
-
Individual self-control and collective outcomes: An examination of cigarette addiction and taxes Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-05-30 Khawaja A. Mamun, Lorán Chollete
Can individual self-control problems affect policy variables? And if so, through what type of channels? Building on recent literature in political economy, we explore a specific channel that allows for links between individual addiction and state taxes. We develop a theoretical lobbying model to explain the role of addiction in the political process of cigarette taxation. Our model shows that equilibrium
-
Automation and inequality with taxes and transfers Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-04-14 Rod Tyers, Yixiao Zhou
Declines in low-skill labour shares are reviewed, and a stylised model is constructed to examine their determinants and future implications. A retrospective analysis of US shocks suggests that technological change has contributed more to raising income inequality and the wealth to GDP ratio than other changes. An anticipated future twist away from low-skill labour toward the capital, combined with
-
Markups, inequality and monetary-fiscal policies Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-02-11 Shiou-Yen Chu
This paper reexamines the cyclical behaviors of price markup, profits, and labor share when responding to monetary and fiscal policy shocks in a two-agent, two-branch, and two-sector model. We show that this framework is able to generate procyclical price markup and profits, and countercyclical labor share conditional on expansionary policy shocks. These results are in line with empirical evidences
-
Tax smoothing and optimal inflation persistence in RBC monetary models revisited Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-01-28 Mehrab Kiarsi
This article re-examines the optimality of tax smoothing and optimal inflation persistence in the context of monetary models with cash constraints where the Friedman rule is not optimal. I consider distortionary taxes on either consumption or labor income. As a consequence of the non-optimality of the Friedman rule, the Ramsey-optimal policy features a tax rate volatility that is orders of magnitude
-
Special issue on the economics of the Middle East and North Africa Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-01-19 David Cobham
-
Urban bias and multinational firms Scottish Journal of Political Economy (IF 0.913) Pub Date : 2022-01-11 Jiancai Pi, Xinyi Liu
This paper explores how urban bias in the host country affects the movement of multinational capital owned by multinational firms in the source country and the production in the invested sector. If the degree of urban bias in one of the urban sectors in the host country increases, then the amount of multinational capital flowing into the host country will increase, but the production in the invested
-
The capital buffer calibration for other systemically important institutions-Is the country heterogeneity in the EU caused by regulatory capture? Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-12-18 Michael Sigmund
In this article, we discuss how the too-big-to-fail dilemma for large financial institution is addressed in the regulatory framework and how (differently) regulators in the EU apply it. The European Banking Authority (EBA) has devised a buffer guideline for identifying other systemically important institutions (OSIIs) to address this issue. This guideline defines how to identify OSIIs by a scoring
-
Discretely innovating: The effect of limited market contestability on innovation and growth Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-11-24 Steven Bond-Smith
I consider the impact of market contestability on innovation and growth. To examine this, I use discrete entry (i.e. an integer number of firms) as a tool to vary contestability in each sector of a disaggregated multi-sector endogenous growth model. Contestability affects entry, extending results beyond competition. As a result, sectors with lower contestability have lower innovation and sectors characterized
-
Norwegian oil market concentration and its effects on the oil service companies 1993–2013 Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-11-22 Lars Christian Bruno, Riana Steen
This paper explores the effect of market concentration of the Norwegian oil production sector (NPS) on Norway's second-largest industry, the oilfield services companies (OFS). To capture this effect, we use the system generalized method of moments approach (GMM) to estimate an empirical model, spanning the period 1993–2013. The findings indicate that increased market concentration is consistent with
-
Interest rate rules and inflation risks in a macro-finance model Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-11-22 Roman Horvath, Lorant Kaszab, Ales Marsal
Long-term bond yields contain a risk premium, an important part of which is compensation for inflation risks. The substantial increase in the Fed funds rate in the mid-2000s did not raise long-term US Treasury yields due to the reduction in the term premium (so-called Greenspan conundrum) which was typically thought to be exogenous for monetary policy. We show using a New Keynesian macro-finance model
-
Dynamic version of Okun’s law in the EU15 countries—The role of delays in the unemployment-output nexus Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-11-20 Thomas Obst
This paper estimates Okun's law in the EU15 countries between 1980 and 2018. It employs different versions with a focus on the dynamic part of the short-run relationship. We find that the negative relationship between unemployment and output generally holds over time. However, Okun's coefficient varies substantially across countries. The dynamic version can shed light on different country estimates
-
Variation in the labour market rewards to vocational qualifications in the UK Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-08-20 Steven McIntosh, Damon Morris
We use UK Labour Force Survey data to estimate wage differentials associated with the attainment of vocational qualifications, relative to comparison groups qualified to at best one level below. Our main aim is to show the variation in the size of such differentials, according to the unobserved characteristics of the individual, via quantile regression and also according to the characteristics of the
-
Non-linear revenue evaluation Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-09-29 Alex Dickson, Ian A. MacKenzie, Petros G. Sekeris
In this article, we investigate different market structures where decision makers are incentivized by both profit and revenue. Our innovation is that we consider managers that evaluate revenue in a non-linear way, exhibiting diminishing marginal utility. This implies that incremental changes in revenue—for example, due to demand shocks—generate production choices that depend on the existing revenue
-
Policy innovation through noise in implementation: Best to be grey (or silver) on Friday, in Halifax Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-09-24 Shaun Hargreaves Heap, Oleksandr Talavera
When the implementation of regulations requires judgement, there is bound to be noise in the application of the rules, but is there bias in the noise such that policy innovation, in effect, occurs in implementation? We use a recently available large postcode data set on the MOT road safety testing in the UK to answer this question. There is significant bias: the probability of failing varies systematically
-
Why they keep missing: An empirical investigation of sovereign bond ratings and their timing* Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-09-20 Makram El-Shagi, Gregor von Schweinitz
Two contradictory strands of the rating literature criticize that rating agencies merely follow the market on the one hand, and emphasizing that rating changes affect capital movements on the other hand. Both focus on explaining rating levels rather than the timing of rating announcements. Contrarily, we explicitly differentiate between a decision to assess a country and the actual rating decision
-
The transmission of partner mental health to individual life satisfaction: Estimates from a longitudinal household survey Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-08-09 Paul McNamee, Silvia Mendolia, Oleg Yerokhin
This paper investigates the relationship between partner's mental health and individual life satisfaction, using panel data and calculating the monetary valuation of mental illness. Accounting for measurement error and endogeneity of income, partners' mental health has a significant association with individual well-being. The additional income needed to compensate someone living with a partner with
-
Does it matter who extorts? Extortion by competent and incompetent enforcers* Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-08-23 Andrew Samuel, Ajit Mishra
This paper offers a novel explanation for extortion, which is the practice of demanding payments from compliant agents by law-enforcement officers. Namely, that extortion occurs due to the officer's incompetence, where the competence level is endogenous. Because competence improves enforcement, extortion affects deterrence directly by weakening agents' incentive to be compliant and indirectly by affecting
-
R&D intensity and income inequality in the G7: 1870–2016 Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-08-18 Sefa Awaworyi Churchill, Bin Peng, Russell Smyth, Quanda Zhang
We examine how R&D has contributed to income inequality in the Group of Seven countries from 1870 to 2016. Using newly developed panel data models that incorporate interactive fixed effects, we find that R&D is negatively associated with income inequality. Non-parametric models that allow us to capture the time-varying effect of R&D suggest that this average effect has been negative for most of this
-
Populism, financial crises and banking policies: Economics and psychology Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-08-09 Federico Favaretto, Donato Masciandaro
Financial crises often seem to be associated with populism, although the populist banking policies introduced to address such crises are far from homogenous. This apparent paradox—a sort of “sight-unseen consensus”—suggests that specific economic drivers coupled with general psychological components can explain populist consensus. We propose a model of populist consensus, which we term “democratic
-
Adversities in Syria and their relation to their physical and mental health conditions as Syrian refugees in Turkey Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-08-02 Mehmet Balcilar, Jeffrey B. Nugent, Jiahui Xu
The purpose of this paper is to examine the extent to which different health problems among Syrian refugees in Turkey can be traced back to three different conditions in Syria (Family Member Killed, House Damaged, and Income) as well as to Commonality among Neighbors back in Syria as well as in Turkey. As is common, the findings show their effects on mental health to be most common, especially among
-
Monetary policy when the objectives of central bankers are imperfectly observable Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-07-10 Francesco Salsano
The paper presents a theoretical model for analysis of the imperfect observability of central bank preferences by the private sector on the decisions taken by the monetary authority, and therefore, on the inflation rate. It examines, in particular, the connection which, in the presence of a time-inconsistency problem, arises between the observability of the monetary institution's goals and its equilibrium
-
Uncertainty, firm entry, and investment dynamics Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-07-09 Stelios Giannoulakis
Previous macro- and micro-level evidence indicate that fluctuations in idiosyncratic uncertainty have an important effect on investment, both directly and indirectly through financial market frictions. The objective of this paper was to explore, beyond the two traditional and complementary channels, a new one: firm entry. By utilizing a novel and large dataset on Greek firms covering the entire economy
-
Inequality and growth in the twenty-first century Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-06-18 Weijie Luo
This paper analyzes how economic growth can be caused by changes in the income distribution. Persson and Tabellini (1994, The American Economic Review, 84, 600-621) argue that productivity-induced income inequality leads to lower growth since distortionary taxes increase and harm capital accumulation. However, this prediction is often challenged empirically. This paper distinguishes between capital
-
Dynamic connectedness and spillovers across sectors: Evidence from the Indian stock market Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-06-11 Ioannis Chatziantoniou, David Gabauer, Hardik A. Marfatia
We investigate stock market sectoral connectedness in India utilizing a time-varying parameter vector autoregressive connectedness approach. Results show that stock market sectoral connectedness varies across time. Connectedness is strongest during the 2008 crisis, the double-digit inflation and stock market crash of 2011, following the national elections of 2014, and the demonetization of 2016. Among
-
Marriage and employment participation with wage bargaining in search equilibrium Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-06-11 Roberto Bonilla, Alberto Trejos
We build an equilibrium search model where married couples make joint decisions on home production and labour market participation and analyse the implications of our results for a frictional marriage market. A worker's bargaining position reflects their productivity, and the productivity and employment status of their spouse. People sometimes accept transitory jobs only to raise the spouse's long-term
-
Externalities of economic sanctions on performance of intra-industry non-sanctioned firms: Evidence from Zimbabwe Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-06-01 Jie Sun, Lewis Makosa, Jinkun Yang, Fangyuan Yin, Moses Jachi, Wellington Garikai Bonga
This paper investigates the effect of targeted economic sanctions by the United States and the European Union on the performance of intra-industry non-sanctioned firms. Using data of non-sanctioned firms listed on the Zimbabwe stock exchange during the period 2009–2018, our regression results show that non-sanctioned firms in the same industry as sanctioned firms perform better than ordinary non-sanctioned
-
The U-shape of happiness in Scotland Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-05-17 David N. F. Bell, David G. Blanchflower
We examine well-being in Scotland using micro data from the Scottish Health Survey and the UK Annual Population Surveys. We find evidence of a midlife nadir or zenith in Scotland in well-being at around age 50 using a variety of measures of both happiness and unhappiness. We confirm that higher consumption of fruit and vegetables is associated with higher levels of happiness in Scotland. We compare
-
Structural change and economic development in the Islamic Middle East 700–1500: Population levels and property rights Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-05-14 Maya Shatzmiller
Economic historians have recently treated Islamic institutions as “growth retarding,” “averse to change,” “path dependent,” “lacking creative destruction” and “extractive” rather than “inclusive” and blamed their failure to change for the underdevelopment of the Middle East. This paper argues for a different approach to Islamic institutions which implies that they boosted economic growth. The paper
-
Value-maximizing football clubs Scottish Journal of Political Economy (IF 0.913) Pub Date : 2021-05-13 Aloys Prinz, Stefan Thiem
In this paper, football clubs are modeled as value-maximizing enterprises. With a long-term perspective in this framework, players are not only factors of production, but also assets of the club. It is shown that talent investment is higher with value-maximization than with profit maximization for homogeneous football clubs. Club heterogeneity is then modeled by different time-horizons regarding future