Explaining post-1964 earnings gains by black women: Race or sex?

This article examines the earnings position of black females relative to white males for the post-1964 period. It finds that over 70 percent of the 1965–78 growth in black female relative median earnings remains after controlling for previous trends, education, and cyclical and labor supply changes. For full-time, year-round workers, the post-1964 trend independently implies a growth rate about 50 percent higher than that actually observed. Approximately one-half of the gains are attributable to race and the rest to the interaction of race and sex. The study finds no support for the censoring hypothesis that allocates a substantial portion of the growth to labor supply decreases. While it suggests occupational mobility to be nonextraneous in the earnings equation, the author argues that the black female now faces a mobility constraint more formidable than previously.     

ASSESSING THE EFFECT OF PUBLIC SUBSIDIES ON FIRM R&D INVESTMENT: A SURVEY

This survey examines the empirical literature on the relationship between public R&D subsidies and private R&D investment over the past five decades. The survey reveals a considerable heterogeneity of empirical results that cannot be explained fully by methodological issues. We aim to provide further explanations of the possible causes of that heterogeneity. In particular, we emphasise a set of issues that, in our view, are critical to understanding the potential effect of public R&D subsidies on private R&D spending. Special attention is paid to the dynamic aspects and composition of firm R&D, the constraints faced by the firm (such as financial constraints), and the amount and source of public subsidies. None of these issues have been investigated in depth. We formulate a set of research assumptions to guide future empirical research in this field.     

Reliable Inference in Categorical Regression Analysis for Non‐randomly Coarsened Observations

In most surveys, one is confronted with missing or, more generally, coarse data. Traditional methods dealing with these data require strong, untestable and often doubtful assumptions, for example, coarsening at random. But due to the resulting, potentially severe bias, there is a growing interest in approaches that only include tenable knowledge about the coarsening process, leading to imprecise but reliable results. In this spirit, we study regression analysis with a coarse categorical‐dependent variable and precisely observed categorical covariates. Our (profile) likelihood‐based approach can incorporate weak knowledge about the coarsening process and thus offers a synthesis of traditional methods and cautious strategies refraining from any coarsening assumptions. This also allows a discussion of the uncertainty about the coarsening process, besides sampling uncertainty and model uncertainty. Our procedure is illustrated with data of the panel study ‘Labour market and social security' conducted by the Institute for Employment Research, whose questionnaire design produces coarse data.     

Disentangling types of liquidity and testing limits-to-arbitrage theories in the CDS–bond basis

We disentangle asset-specific, market, and funding liquidity in the CDS–bond basis outside and during the 2007–9 global financial crisis. Our findings stress the importance of separating different types of liquidity, since all three measures have independently negative impacts on the basis. Funding liquidity emerges as the economically most important liquidity metric. While asset-specific liquidity is cross-correlated in both the cash and derivative markets, funding and market liquidity only matter for the cash market. We exploit the decomposition of the basis to test predictions of limits-to-arbitrage theories. We find strong evidence in favor of margin-based asset pricing and flight-to-quality effects.     

Tourism competitiveness index of the Asia-Pacific region through consistency analysis

The world’s economy shifts to a more competitive environment as globalization expands and countries have to adjust by making decisions to improve their competitiveness in all sectors. The Travel and Tourism Report, a useful tool facilitating policy-making and business decisions, allows entities to envision their ranking in the face of the travel and tourism through the creation of a competitiveness index. Focusing on Asia and the Pacific, this paper intends to investigate internal consistency of the constructs based on data analysis techniques such as correlation and reliability, essentials to broader acceptance of the index. The results indicate that high linear association between index and pillars leads ultimately to good level of consistency and highlight the lack of relationship between overall consistency and inter-class consistency. It is suggested to pay close attention to unidimensionality of constructs and inter-relation between variables while building an indicator system as it increases its reliability.     

The External Debt‐Servicing Constraint and Public‐Expenditure Composition in Sub‐Saharan Africa

Abstract: In the light of the current global financial and economic crises, how would governments in sub‐Saharan Africa (SSA) allocate their budgets across sectors in response to a binding debt‐servicing constraint? Within a framework of public‐expenditure choice, the present paper estimates constraint‐consistent debt‐service ratios and employs them in a Seemingly Unrelated Regression involving a five‐year panel for up to 35 African countries over 1975–94, a period preceding the Highly Indebted Poor Countries (HIPC) initiatives. While observed debt service is found to be a poor predictor of expenditure allocation, constraining debt servicing shifts spending away from the social sector, with similar impacts on education and health. The implied partial elasticity of the sector's expenditure share with respect to debt is estimated at 1.5, the highest responsiveness by far among all the explanatory variables considered, including external aid. Thus, if the social sector is to be protected, sufficient debt relief for SSA countries should be pursued.     

The potential for marrying local gastronomy and wine: The case of the ‘fortunate islands’

For centuries, the Mediterranean and other regions have become icons for their food, wine, laid-back lifestyle and benign weather, with each of these components ideally complementing the other three. The availability of a local cuisine and local wines provides consumers with memorable experiences. However, in many other regions little is known about ways in which the local cuisine and wine could be ‘married.’ This study examines the views of 55 small winery operators in a region that for decades has been widely known as a mass tourism destination: the Canary Island in Spain. While most operators recognise the potential for a perfect local cuisine–wine marriage, many also mention the missing link between the local hospitality and wine sectors. For instance, respondents argue that restaurateurs are not promoting local wines enough in favour of cheaper imports. The study also discusses the implications of the findings and identifies areas of future research.     

Semiparametric Estimation of a Duration Model

Within the framework of the proportional hazard model proposed in Cox (1972), Han and Hausman (1990) consider the logarithm of the integrated baseline hazard function as constant in each time period. We, however, proposed an alternative semiparametric estimator of the parameters of the covariate part. The estimator is considered as semiparametric since no prespecified functional form for the error terms (or certain convolution) is needed. This estimator, proposed in Lewbel (2000) in another context, shows at least four advantages. The distribution of the latent variable error is unknown and may be related to the regressors. It takes into account censored observations, it allows for heterogeneity of unknown form and it is quite easy to implement since the estimator does not require numerical searches. Using the Spanish Labour Force Survey, we compare empirically the results of estimating several alternative models, basically on the estimator proposed in Han and Hausman (1990) and our semiparametric estimator.     

Labor force participation of black and white married women: Evidence from urban labor markets

The study theoretically argues that differential economic conditions constitute an important rationale for structural differences in labor force participation (LFP) between black and white married women. Empirical evidence based on 1980 census data for metropolitan statistical areas provides support for the concomitant hypotheses. Not only is the LFP propensity for black wives larger, but also it is relatively insensitive to the arguments of the LFP function. Thus policies designed to influence the LFP of these two racial groups must internalize the differential economic conditions between them.