Jackknife instrumental variables estimation: replication and extension of angrist,imbens and krueger (1999)

I replicate most of the results in Angrist, Imbens, and Krueger (Journal of Applied Econometrics 1999; 14: 57–67), point to a possible error in and re‐estimate Model 3, and analyze some simple extensions. The programming code, data, and results are available at http://sites.google.com/site/antonnakov/software . Copyright © 2010 John Wiley & Sons, Ltd.     

Monetary effects on nominal oil prices

The paper presents a theory of nominal asset prices for competitively owned oil. Focusing on monetary effects, with flexible oil prices the US dollar oil price should follow the aggregate US price level. But with rigid nominal oil prices, the nominal oil price jumps proportionally to nominal interest rate increases. We find evidence for structural breaks in the nominal oil price that are used to illustrate the theory of oil price jumps. The evidence also indicates strong Granger causality of the oil price by US inflation as is consistent with the theory.     

ALL IN: AN EMPIRICAL ANALYSIS OF LEGISLATIVE VOTING ON INTERNET GAMBLING RESTRICTIONS IN THE UNITED STATES

In 2006, the U.S. Congress passed the Unlawful Internet Gambling Enforcement Act (UIGEA) which prohibited financial institutions from processing transactions arising from online gaming activities, thereby severely hindering U.S. residents from participating in online casino games, primarily poker. Enactment of this legislation followed lobbying and political pressure from a variety of interest groups. By examining House roll call votes, we identify empirically the sources of political influence that resulted in passage of the internet gambling legislation. We find that party affiliation was of primary importance, with Republicans more likely to vote in favor of the bill. The percentage of constituents who are Evangelical Christians and also the number of gambling establishments in the district were positively associated with votes for the bill. However, contributions from the gaming industry decreased the probability a congressman would vote for the bill. (JEL D72, L83)     

Should the IMF resort to private credit markets for refinancing?

The International Monetary Fund is at present examining the possibility of borrowing on private capital markets in order to meet its growing refinancing needs. Reservations concerning such a step have been voiced in particular by the oil-importing developing countries. Professor Konrad analyses the pros and cons.     

US growth and budget consolidation in the 1990s: was there a non-Keynesian effect?

The 1990s were an extraordinary period for the US economy, both because of declining budget deficits and emerging budget surpluses, as well as high rates of economic growth. This paper challenges the conventional wisdom that high growth rates caused budget improvements, and claims that budget consolidations also contributed to fostering economic growth. We propose the existence of a non-Keynesian effect, where fiscal policy runs counter to Keynesian theory and fiscal consolidation can foster economic growth. We present empirical evidence that an increase in tax revenues reduces the distortionary bias of future taxation and therefore leads to an increase in consumer confidence and consumption. Two supply side effects are proposed: a reduction in transfers reduced labour market pressures and government savings provided liquidity for financial markets, both of which increased incentives to invest.     

Unemployment and Catching Up: Europe Vis-à-vis the USA

This paper develops a two-region two-sector endogenous growth model with a dual labour market based on efficiency wages. Growth is driven by research done in the (high-tech) tradeables sector. The follower region tends to catch up in terms of labour productivity with the leader region. Differences in unemployment compensation systems can lead to relative convergence, i.e., a steady state with the backward region lagging behind the leader region. The reason for this is that high social welfare compensations generate high unemployment and reduce the amount of labour employed for R&D purposes.     

INTERNATIONAL ECONOMIC CO-OPERATION

Books reviewed in this article: Ralph Bryant, Dale Henderson, Gerald Holtham, Peter Hooper, Steven Symansky (eds) (1988) Empirical Macroeconomics for Interdependent Economies Marcello De Cecco and Alberto Giovannini (eds) (1989) A European Central Bank? Ralph Bryant, David Currie, Jacob Frenkel, Paul Masson and Richard Portes (eds) (1989), Macroeconomic Policies in an Interdependent World Richard Cooper, Barry Eichengreen, Gerald Holtham, Robert Putnam and Randall Henning (1989) Can Nations Agree?     

An evaluation of government- sponsored vocational training programmes for the unemployed in urban Russia

This is the first study on the effects of active labour marketprograms such as training in Russia. We use the data from theofficial unemployment register combined with information fromthe follow-up survey in a large industrial city in the year2000. The method of propensity score matching was applied tolearn whether participation in the training programmes increasedthe monthly salaries of participants. The findings suggest thatindividuals tend to benefit from the participation in the trainingprogrammes. However, one year later, this effect disappeared.