Growth is (really) good for the (really) rich

This paper analyses the relationship between mean income and the income of the rich. Our methodology closely follows that of Dollar and Kraay (Journal of Economic Growth, 2002, 7, 195), but instead of looking at the bottom of the distribution, we focus on the top. We use panel data from the World Top Incomes database, which collects top income data from several countries using tax returns as the raw source. We define the “rich” as earners in the top 10%, 1%, 0.1% and 0.01% of the income distribution. Using data since 1980, we find that economic growth is good for the rich in the sense that the mean income of the top decile of the distribution grows in the same proportion as that of the whole population. However, we also find that the income of earners in the top percentile of the distribution and above grows faster than average income: therefore, economic growth is really good for the really rich. We also find that during economic downturns the average income of top earners responds proportionally less to changes in mean income than during economic expansions. Our results are consistent with the increase in inequality that has been recently observed at the top part of the distribution in many countries, and they are robust to different specifications, country samples and time observations.     

Socioeconomic inequality in health-related behaviors: a lifestyle approach

The adoption of certain behaviors—like smoking or physical activity—is recognized as a major factor affecting health. Analyzing the social determinants of these behaviors, then, should be considered an important goal, since it may improve our understanding of the more general phenomenon of health inequalities. In this paper we analyze the association between socioeconomic status (SES) and health-related behaviors among the Italian population aged 18–74 in 2004/2005. Using large-scale sample survey data and a Weberian lifestyle approach, we first identify an ordered multidimensional space of health-related behaviors, and partition this space into a meaningful set of discrete regions representing a fine-grained taxonomy of health lifestyles. Then, we use regression analysis to determine if, and to what extent, the identified lifestyles are associated with SES. Using level of education as an indicator of SES, we find that the propensity to adopt healthier lifestyles exhibits a positive educational gradient, whereas the probability of following less healthy lifestyles is inversely associated with the level of education. We conclude that, in general, focusing on health lifestyles—i.e., on combinations of multiple health-related behaviors—instead of single behaviors may lead to a better understanding of health-related practices and their relationship with socioeconomic status.     

Improving Group Attention: An Experiment with Synchronous Brainstorming

In this paper we address the problem of information overload in synchronous group work: the large quantity of information, multiple information sources, and the need to sustain reciprocal interdependence have a negative impact on the capacity to attend to the group. We propose a group attention model characterizing the dynamic coupling between the group members and the mediating technology. Based on that model, we developed a compensation mechanism capable to estimate the most adequate time to raise the users?? attention to the group. We describe how this compensation mechanism was applied to synchronous brainstorming and present results from a laboratory experiment. The obtained results indicate that groups using the compensation mechanism produced 9.6% more ideas when compared to the control groups. A detailed post-hoc analysis of the data obtained in the experiment also indicates that users using the compensation mechanism had 7.5 s of extra uninterrupted time to think about and type an idea, which they began to write 6.4 s sooner, and completed in 4.2 s less time.     

Technological content of exports

A large body of literature argues that the characteristics of exports matter for economic growth and development because some goods trigger positive externalities or are subject to increasing returns. Thus, for policy purposes, it is important to know whether a country’s export basket enjoys these productive opportunities. They have been associated with technological content of exports. However, measuring them is not easy. Previous methodologies to account for exports’ technological content used either R&;D data or trade data. The former is used to account for knowledge-intensive activities during the production phase and the latter to identify levels of ‘sophistication’ of exports based on exporting countries’ characteristics. Building on these contributions, this paper combines industry-based and product-based indicators to circumvent some of the shortcomings of the received literature, including the product-industry controversy (i.e. are the actual activities during the production process or the product characteristics what better accounts exports’ technological content?). We use data from Uruguay on direct and indirect R&;D spending from public and private sources and also trade data to build the sophistication index corrected by quality. We contrast our findings with existing methodologies to highlight our contribution.     

Dissipation of Knowledge and the Boundaries of the Multinational Enterprise

This paper provides a theoretical formalization of the joint-venture contract, as an alternative to foreign direct investment (FDI), within a Dissipation of Intangible Assets (DIA) framework. In a two-period model, we discuss how the threat of knowledge spillover shapes the boundaries of a multinational enterprise (MNE). Similarly to the theoretical findings on the FDI-licensing trade-off, we show that the integrated solution is more likely to emerge when know-how easily spills over—i.e., when firms are endowed with more intangible assets or they belong to high-tech industries. Probit estimates, from a new firm-level data set, show that Japanese manufacturing operations in Europe are in line with these predictions. JEL no. F23, C25, O5     

A Tale of Three Countries: Italian,Spanish and Swiss Manufacturing Operations in China

In this paper, the choice of joint venture versus wholly foreign‐owned enterprise (WFOE), made by Italian, Spanish and Swiss multinationals in China, as shaped by the risk of dissipation of intangible assets, is investigated. Probit estimates, based on an entirely new firm‐level dataset, constructed by the author, show that WFOE is more likely to emerge when know‐how easily spills over – namely for firms endowed with more intangible assets or belonging to high‐tech sectors – in line with the theoretical expectations.     

Volatility, trade size, and order imbalance in China and Japan exchange traded funds

In recent years there have been reports of excessive price volatility and value differences between prices of exchange traded funds (ETFs) and their underlying asset values. The objective of our study is to shed light on these facts by taking a closer look at the relationship between return volatility, trade size, and order imbalance for international ETFs. Even after controlling for order imbalance, volume as represented by number of trades in one of five trade size categories continues to have a significant and predominantly positive impact on volatility. Both trade size and order imbalance are important determinants of the Japan and China ETFs’ price volatility.     

Union responses to ‘multi‐enterprise’ factories in the Italian motor industry

During the 1990s, outsourcing work was commonly associated with the weakening of union organisation and the deterioration of pay, working conditions and job security. A variant of outsourcing, termed here as ‘insourcing’, involves a firm purchasing ‘non‐core’ functions and services from enterprises located under the same roof. This case study of Fiat outlines the impact of insourcing on traditional arrangements and practices, and analyses the response of Italian local unions. The findings indicate that in the context of ‘bargained compromise’ between trade unions and management in the Italian motor industry insourcing did not have the negative implications for union organisation and employee terms and conditions associated with traditional outsourcing.     

Reopening the convergence debate: A new look at cross-country growth empirics

There are two sources of inconsistency in existing cross-country empirical work on growth: correlated individual effects and endogenous explanatory variables. We estimate a variety of cross-country growth regressions using a generalized method of moments estimator that eliminates both problems. In one application, we find that per capita incomes converge to their steady-state levels at a rate of approximately 10 percent per year. This result stands in sharp contrast to the current consensus, which places the convergence rate at 2 percent. We discuss the theoretical implications of this finding. In another application, we perform a test of the Solow model. Again, contrary to prior reults, we reject both the standard and the augmented version of the model.