Financial intermediation and growth: causality and causes without outliers

In a seminal paper, Levine et al. (J Monet Econ 46:31–77, 2000) provide cross-sectional evidence showing that financial development has positive average impact on long-run growth, using a sample of 71 countries. We argue that the evidence is sensitive to the presence of outliers.

Market power under income polarization

We study the reaction of a monopolistic firm to distributive shocks which lead to income polarization. We show that the movements in the set price and in the sold quantity depend on the served market share. In particular, we identify a region of parameters where the optimal markup moves in the opposite direction of market demand: in this respect, distributive shocks can provide an explanation for countercyclical movements of the markup.     

Raising the bar (8)

This editorial summarizes the papers published in issue 13(3) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper challenges the home market hypothesis that large countries host more firms relative to their size than small countries by considering the lobbying activities of multinational firms. The second paper analyzes the implications of a spatial weight matrix used to estimate a spatial econometric model that depends on an endogenous economic variable. By adding a spatial context, the third paper provides a novel contribution to the literature on international norms in de facto measures of human rights performance. The fourth paper examines the determinants of accepting informal work in Poland. The fifth paper deals with non-stationarity and cointegration in a dynamic spatial econometric panel data model when the number of observations in the time – rather than in the cross-sectional– domain tends to infinity.     

Economic downturns and compositional effects in regional population structures by age: a multi-temporal analysis in Greek regions, 1981–2017

Population movements (international and internal migration) and changing fertility and mortality patterns have significantly affected demographic structures. Investigation of the relationship between (evolving) population structures and economic downturns is a key issue in economic demography. Analysis of compositional changes in regional population structures over a sufficiently long time interval may provide an informed knowledge to better understanding of this relationship and the underlying socioeconomic context in European countries. Based on these premises, Greece was considered a paradigmatic case of sequential economic expansions and recessions, impacting the structure of resident population in the last four decades. In this work, changes over time in population structures by age in Greek regions were explored (1981–2017) using a multi-temporal principal component analysis. A diachronic analysis of compositional effects of economic downturns on regional population structures indicates spatially-heterogeneous demographic processes in Greece. The subsequent recession has represented a turning point in Greek demography, consolidating changes in traditional family structures, while stimulating out-migration at younger ages to Northern and Western European regions and containing immigration from developing countries. Metropolitan areas and coastal districts had more rapid population dynamics, while peripheral rural regions experienced more rapid changes towards aging. Population aging had a short-term impact on regional population structures in Greece, with possibly negative consequences for the ability of the country’s economy to recover from crisis.

     

The United Kingdom and the stability of the Euro area: From Maastricht to Brexit

The two key events expected to mark the year 2019 were the 20th anniversary of the euro and Brexit. This paper examines the role of the United Kingdom on the stability of the euro area. We study stability from the perspective of synchronisation of economic activity in a core and periphery framework. We show the UK, since 1990, has become significantly more integrated with the EU economy. The UK moved from the periphery before 1990 to the core afterwards. We also find that the level of synchronisation of the UK economy has had the highest variability over time among all countries.     

Raising the bar (1)

In this editorial, we summarize and comment on the papers published in issue 11.1 so as to raise the bar in applied spatial economic research and highlight new trends. The first paper employs the J-test to discriminate between two economic-theoretical explanations for the wage curve. The second applies a two-step ML procedure to measure the impact of volatility on economic growth. The third tests for endogeneity in the Spatial lag of X (SLX) model and whether or not the model should be extended to contain a spatial lag. The fourth utilizes the gravity model to test whether or not grids should be merged into larger units of observations. Finally, the last adopts a time-space recursive model to test the ripple effect and (linguistic) border effect hypotheses on housing prices in Belgium.     

Knowledge Spillovers,ICT and Productivity Growth

This paper looks at the channels through which intangible assets affect productivity growth. The econometric analysis exploits a new data set on intangible investment (INTAN‐Invest) in conjunction with EUKLEMS productivity estimates for 10 EU member states from 1998 to 2007. We find that (a) the output elasticity of intangible capital depends upon ICT intensity, consistent with complementarities between ICT and intangible capital; (b) non‐R&D intangible capital has a higher estimated output elasticity than its factor share, as does (c) an index of labour composition. The last two findings are consistent with growth spillovers from investments in knowledge‐based/intangible capital and skills.     

Multiplicative habit formation and consumption: A note

A multiplicative form of the habit term in the utility function has some undesirable properties if the habit function is itself still additive (Wendner, 2003). A geometric form for the way the stock of habit accumulates can resolve these shortcomings.     

Urban development and expenditure efficiency in the 2000–2006 regional operational program of Sardinia

The Sardinian regional operational program 2007–2013 concerning the European Regional Development Fund (ERDF) (2007–2013 ROP-ERDF) respects the rules of the ERDF on the investments for territorial cohesion since it promotes their regional geographic concentration. These investments are evenly shared between large- and medium-sized urban areas, and disadvantaged zones. This paper analyzes the investment policies implemented by the Sardinian Region through the 2000–2006 ERDF based part of the Regional Operational Program (2000–2006 ROP-ERDF), in order to assess their effectiveness, in terms of expense efficiency, for urban areas and disadvantaged zones. The assessment of the expenditure efficiency of the 2000–2006 ROP-ERDF is very important to address the policies of the 2007–2013 ROP-ERDF in terms of geographic concentration. The essay analyzes the results of the 2000–2006 ROP-ERDF, with reference to the expenditure efficiency of Sardinian cities, represented through a geographic information system, by means of a multinomial logit model.     

The forecast quality of CBOE implied volatility indexes

We examine the forecast quality of Chicago Board Options Exchange (CBOE) implied volatility indexes based on the Nasdaq 100 and Standard and Poor's 100 and 500 stock indexes. We find that the forecast quality of CBOE implied volatilities for the S&P 100 (VXO) and S&P 500 (VIX) has improved since 1995. Implied volatilities for the Nasdaq 100 (VXN) appear to provide even higher quality forecasts of future volatility. We further find that attenuation biases induced by the econometric problem of errors in variables appear to have largely disappeared from CBOE volatility index data since 1995. © 2005 Wiley Periodicals, Inc. Jrl Fut Mark 25:339–373, 2005