The labour market effects of financial crises

This paper examines how the 2008–2009 financial crisis affected labour markets in Europe, and how this impact depended on employment protection laws. Using a difference‐in‐differences approach, our estimates isolate the effect of the lack of credit on the labour market from that of the general decline in aggregate economic activity. We find large and negative impacts of the credit shock on total employment, particularly on temporary, unskilled and young workers. These impacts were significantly larger in countries with stronger legal protection of permanent workers from dismissal. This suggests that the differential impact of the crisis across countries was not entirely driven by the heterogeneity of the credit shock, but also by labour regulations. Given regulatory inflexibility in adjusting the permanent workforce, firms responded to tightening financial constraints by disproportionately laying off temporary workers (who tend to be younger and less skilled than permanent workers).     

SMEs and the Potential for A Collaborative Path to Environmental Responsibility

Globally, the potential for small and medium‐sized enterprises (SMEs) to collectively impact negatively on the environment is great. Therefore, the adoption, and maintenance, of environmentally responsible practices by this group of firms is especially critical. Studies of environmental practices successfully implemented by small firms have revealed that relationships with other firms, or other organizations, can contribute to greater awareness of the benefits of such activities and, therefore, enhance the possibility of environmental engagement. Collaborative relationships may provide opportunities for SMEs to overcome some of the barriers to implementing environmental initiatives associated with their size, and/or associated characteristics. This paper focuses on attitudes of SME owner‐managers to a variety of environmental issues (including regulation and voluntary standards), and to collaborating with other firms (in either a formal or informal sense). The data this paper draws upon are from two waves of an ongoing longitudinal survey of New Zealand SMEs. Copyright © 2014 John Wiley & Sons, Ltd and ERP Environment     

Evaluating the effects of entry regulations and firing costs on international income differences

This paper analyzes the effects of entry regulations and firing costs on cross-country differences in income and productivity. We construct a general equilibrium industry-dynamics model and quantitatively evaluate it using the cross-country data on entry costs and firing costs. Entry costs lower overall productivity in an economy by keeping low-productivity establishments in operation and making the establishment size inefficiently large. Firing costs lower productivity by reducing the reallocation of labor from low-productivity establishments to high-productivity establishments. The linear regression of the data on the model prediction accounts for 27% of the cross-sectional variation in total factor productivity. Moving the level of entry costs and firing costs from the U.S. level to that of the average of low income countries (countries with a Gross National Income below 2% of the U.S. level) reduces TFP by 27% in the model without capital, and by 34% in the model with capital and capital adjustment costs.     

The effect of income inequality on political polarization: Evidence from European regions, 2002–2014

This article investigates whether income inequality leads to political polarization and provides new evidence that an increase in the Gini coefficient at the local level increases the probability of supporting a political party at the extreme left and right of the ideological distribution. Using individual data for 25 European countries from 2002 to 2014, I find that increasing inequality leads on average to more support for left‐wing parties. I also find that increasing inequality leads to more support for far‐right parties among older individuals. Support for far‐right parties seems to be driven by rising anti‐immigrant sentiments. The results are robust to different specifications, including an instrumental variable that addresses the endogeneity of income inequality.     

How does the internet affect migration decisions?

This article provides new evidence on the impact of the internet on migration decisions. I find that an increase in internet adoption among migrant-sending countries reduces the stock of migrants from these locations. The results are robust to a number of specifications, including an instrumental variable approach that addresses the endogeneity of internet adoption. The findings suggest that the internet may weaken the importance of push factors in the decision to migrate, and that these effects outweigh declines in mobility costs.     

Revisiting the determinants of futures contracts success: the role of market participants

The Chicago Mercantile Exchange introduced a futures contract for distillers’ dried grains (DDGs) in early 2010, but the market became inactive only four months after its inception. While many new futures contracts do not develop into high‐volume traders, interest from DDG cash market participants indicated that this contract could be successful. Prompted by the unexpected lack of trading activity in this new futures market, we empirically revisit the question of what factors contribute to a futures contract's success and extend the literature by investigating the roles of market participants and the significance of supporting futures markets. Estimation results indicate that the market participant type—hedger or speculator—affects futures contract trade volume. More importantly, we find that the viability of new futures contracts for commodities that are jointly produced with other commodities is impacted by hedgers’ trade volume of the related futures contract. These results provide important additions into the portfolio of indicators used by commodity exchanges to more cost‐effectively evaluate new futures contract products.     

Online conversion rates among Australian financial institutions: A qualitative exploration

This study examines factors affecting online conversion success of financial institutions in Australia. Twenty financial institutions (nine banks and 11 credit unions) were divided into four clusters based on the size of their client base. A cross-case comparison of the financial institutions in each group was then qualitatively analysed with respect to the joint effects of six variables on online conversion rate: banking practice, cost-efficiency, online banking experience, online product and service portfolio, response time to online queries, and branch network. Results of the comparative analysis show that the recipe for online success lies in getting the right combination of variables. To achieve an online conversion rate of no less than 25 per cent, financial institutions with a client base exceeding 100,000 need to have attained a cost-to-income ratio of no greater than 0.55, have three or more years of online banking experience coupled with a branch-to-client ratio between 1 and 2 per 10,000 customers. For credit unions with a client base of less than 100,000, the corresponding criteria are having a cost-to-income ratio of no more than 0.67, a response time to online queries of 3?h or less, and no less than four years of online banking experience.     

Motivation for creativity in architectural design and engineering design students: implications for design education

The investigation reported here dealt with the study of motivation for creativity. The goals were to assess motivation for creativity in architectural design and engineering design students based on the Cognitive Orientation theory which defines motivation as a function of a set of belief types, themes, and groupings identified as relevant for the development of creativity. Differences between the two groups of students were expected in some of the scores of the belief types, themes, and groupings. Participants were 112 students (52 from architecture, and 60 from engineering) who were administered the questionnaire of the Cognitive Orientation of Creativity. Significant differences in numerous motivational contents were observed between the groups of students. Major characteristics of the architectural design students were an emphasis on the inner world, inner-directedness, and a development of the self, and of the engineering design students being receptive to the environment, and demanding from oneself despite potential difficulties. The findings provide insights for intervention programs targeted at improving architectural and engineering design education.