Distributional effects of social security reforms: The case of France

This paper assesses the impact of two social security reforms using a calibrated, dynamic life cycle model. It quantifies the long‐run distributional impact of two sets of reforms in France: (1) the 2013 reform of Prime Minister Ayrault, which modified the parameters of a defined benefit (DB) plan, and (2) a hypothetical reform that changes the system to a notional defined contribution (NDC) plan, similar to that in Italy. First, on aggregate welfare, the Ayrault reform and the hypothetical switch to NDC yield contrasting results. The Ayrault reform improves aggregate welfare, which is not the case for the NDC reform. Welfare comparisons are made with respect to the “benchmark economy,” where increases in life expectancy occur and are dealt with only through a higher contribution rate. Second, both reforms yield unequal distributions of welfare changes, with low‐skill workers on the losing end. Under the Ayrault reform, low‐skill workers delay retirement by two years, to age 62. Under NDC reform, pensions for low‐skill workers fall substantially as inequalities during the work life translate directly into inequalities in pensions. The switch to an NDC scheme leads to a more unequal society in terms of asset and welfare distribution.     

Pedagogical and technological replanning: a successful case study on integration and transversal skills for engineering freshmen

Replanning is often used to optimize results of an activity in an ever changing world. To address the challenge of preparing future engineers for success, a special course was created for all engineering freshmen of the Faculty of Engineering of the University of Porto, in Portugal. Presented as a case study, this special course underwent a careful replanning as a result of several years of experience in teaching practice alongside with a theoretical deepening in pedagogical and technological issues, under the aegis of the action-research methodology. Within the context of the case study course, the mentioned replanning was also based on a theoretical approach that clearly identifies teaching–learning-assessment methodologies that promote regulation from those that foster emancipation, using a specific instrument: a taxonomy of educational processes. The replanning was designed to globally boost results regarding the educational aims of the course such as furthering freshmen’s integration into work environment and preparing them for success by fostering transversal skills (needed for study and work). Technology is seen as a mean of education enrichment as well as a productivity tool. The introduced innovations include fun-but-educational activities, several types of assessment over time and specific technological tools which were critical for the educational impact/achievement of this course. Success is demonstrated by encouraging feedback from the stakeholders, high students’ classifications and a steady reduction in retention. It is advocated that large portions of the reasoning behind the replanning can be extrapolated to other courses.     

Rituals of cruise consumption and the 'new' middle class: desiring and 'devouring' maritime cruises

The consumption of maritime cruises is one of the most striking facets of the phenomenon of a new middle class emergence in Brazil. This study investigates the use of maritime cruises by emerging middle-class consumers to enact their new social status. Specifically, the research looks at ritualistic behaviour performed by consumers before, during, and after a cruise. The research uses a multi-method design characterised by a combination of ethnography and group discussions. The study contributes to enlarge McCracken’s typology of consumption rituals, showing how emerging consumers use the cruise as a rite of passage, during which they perform rituals of preparation, production, possession, and divestment. It also sheds light on specific rituals performed by consumers in order to transfer meanings from the cruise to their own selves. Finally, the findings suggest that consumption rituals in the context of social ascent may not have the transformative power of traditional rites.     

Leadership Dynamics in Partially Distributed Teams: an Exploratory Study of the Effects of Configuration and Distance

Despite the importance of leadership and the wealth of empirical studies focused on leadership effectiveness in traditional and computer-supported groups, there is little research examining leadership dynamics in partially distributed virtual teams (PDTs). Virtual teams are partially distributed when they are configured with one or more subgroups of collocated members and isolated members. This paper lays the groundwork for an in-depth study of leadership in PDTs that can be extended to other types of virtual team configurations. Using three dimensions of virtual distance (geographic, cultural and temporal), we analyze how the configuration of virtual teams interacts with leadership dynamics. We also summarize the results of an exploratory study using 12 student teams to examine the effects of distance and configuration on leadership in PDTs. Findings show significant differences in leadership dynamics (i.e., leader emergence vs. leader retention) which impacted team performance. From these results, we develop propositions on leadership and PDTs.     

Quasi-structural estimation of a model of childcare choices and child cognitive ability production

This article evaluates the effects of maternal vs. alternative care providers’ time inputs on children’s cognitive development using the sample of single mothers in the National Longitudinal Survey of Youth. To deal with the selection problem created by unobserved heterogeneity of mothers and children, we develop a model of mother’s employment and childcare decisions. We then obtain approximate decision rules for employment and childcare use, and estimate these jointly with the child’s cognitive ability production function. To help identify our selection model, we take advantage of the plausibly exogenous variation in employment and childcare choices of single mothers generated by the variation in welfare rules across states and over time created by the 1996 welfare reform legislation and earlier State waivers.     

The productivity impact of R&D investment: are high-tech sectors still ahead?

Our aim is to investigate the relationship between a firm's R&D expenditures and its productivity, looking at sectoral peculiarities. We use a unique longitudinal database consisting of 1809 US and European manufacturing and service firms over the period 1990–2008. Our main findings can be summarised as follows. Consistently with previous literature, the knowledge stock has a significant positive impact on a firm's productivity. More interestingly, the coefficient turns out to be significantly larger in the R&D-user services and high-tech manufacturing sectors than in the non-high-tech manufacturing sectors. Contrary to the ‘latecomer advantage’ approach, these outcomes suggest that firms in high-tech sectors are still ahead in terms of impact on productivity of R&D investments.     

CAPM and APT-like models with risk measures

The paper deals with optimal portfolio choice problems when risk levels are given by coherent risk measures, expectation bounded risk measures or general deviations. Both static and dynamic pricing models may be involved. Unbounded problems are characterized by new notions such as (strong) compatibility between prices and risks. Surprisingly, the lack of bounded optimal risk and/or return levels arises for important pricing models (Black and Scholes) and risk measures (VaR, CVaR, absolute deviation, etc.). Bounded problems present a Market Price of Risk and generate a pair of benchmarks. From these benchmarks we introduce APT and CAPM-like analyses, in the sense that the level of correlation between every available security and some economic factors explains the security expected return. The risk level non correlated with these factors has no influence on any return, despite the fact that we are dealing with risk functions beyond the standard deviation.     

Debt Concentration and Bargaining Power: Large Banks,Small Banks,and Secondary Market Prices

Commerical bank debts of developing countries are held by large international banks and smaller domestic banks. This paper investigates how debt concentration—the proportion of a country's debt held by large banks relative to small banks—affects the secondary market price for these loans. We find that countries with higher concentrations have higher secondary-market prices. We explain this empirical finding in a bargaining model that endogenizes the maximum penalty that banks can credibly impose on a recalcitrant debtor. We show that the banks' bargaining power increases with the degree of debt concentration, thus increasing repayment and secondary-market prices.     

Evaluating social welfare and redistributive effects of Spanish personal income tax reform

Spain has recently concluded a process of wide-ranging reform of its personal income tax (IRPF), in force since 1992. The new IRPF is applicable from 1999 onward. The aim of this article is to analyse the implications of this tax reform for the distribution of personal income, and additionally to provide a comparative evaluation in terms of social welfare of both taxes. Empirical analysis is performed by a simulation exercise, employing the microdata contained in the Institute of Fiscal Studies’?IRPF Panel of Taxpayers. The analysis shows that the new IRPF induces a redistributive effect slightly lower than the old IRPF. The greater redistributive potential of the progressive structure of the new tax proves to be insufficient to compensate for the contrary effect caused by reduction in the level of tax liability. However, this new tax unambigously permits, in an inequality-adverse society, a higher level of social welfare than that attained by the old tax.     

Investors’ perspective on portfolio insurance

Portuguese Economic Journal - This study supports the use of behavioural finance to explain the popularity of portfolio insurance. Portfolio insurance strategies are important financial solutions...