IMMIGRATION POLICY, CULTURAL PLURALISM AND TRADE: EVIDENCE FROM THE WHITE AUSTRALIA POLICY

Abstract.   Examining data for Australia and 101 trading partners that span the years 1989–2000, we find immigrants from nations afforded preference under the White Australia policy exert greater proportional influences on Australian imports from their home countries compared to immigrants from nations not privy to such preference. Immigrants from this latter group of countries influence Australian exports to their home countries proportionally more than do immigrants from the former group. We also find immigrant-trade links vary across disaggregated measures of trade. The results suggest that cultural diversity, affected here by immigration policy, is relevant to a nation's trade patterns.     

FISCAL POLICY AND AGGREGATE CONSUMPTION: NEW EVIDENCE FROM THE UNITED STATES

In this paper we estimate the marginal rate of substitution between aggregate per-capita consumption and per-capita government expenditure on goods and services using US quarterly data over the period 1953 to 1993. This estimate is an important input to any attempt to assess the overall effectiveness of fiscal policy since it directly affects the size of the fiscal policy multiplier. Other recent consumption studies which incorporate the effects of government expenditure have failed to establish a stable estimate of the marginal rate of substitution. We argue that this failure results from imposing the unrealistic assumption that this parameter is constant. In contrast, we allow the marginal rate of substitution to depend on both the level and composition of government spending.     

THE RETURNS TO EDUCATION AND TRAINING: EVIDENCE FROM THE MALAYSIAN FAMILY LIFE SURVEYS

Abstract. The main purpose of this paper is to investigate the private returns to education and training in the 1980s for a random sample of women in Malaysia. I estimate a Mincer type earnings function, augmented by information on the women's training experience. The results indicate that there are positive and economically significant returns to education and training. I also investigate the determinants of training and find that training participation is positively related to educational attainment, while if women are credit-constrained they are significantly less likely to undertake training.     

TRADE POLICY AND MARKET POWER: FIRM‐LEVEL EVIDENCE

This article identifies the effect of trade policy on market power through new data and a new identification strategy. We identify market power by observing how exporting firms price discriminate across markets following variations in bilateral exchange rates. Pricing‐to‐market is prevalent in all countries in our sample, even among small firms, although it is increasing in firm size. More importantly, we find that the effect of nontariff measures (NTMs) is not isomorphic to that of tariffs. Whereas tariffs reduce the market power of foreign firms through rent‐shifting effects, NTMs reinforce the market power of nonexiting firms, domestic and foreign alike.     

TIME‐INCONSISTENCY AND WELFARE PROGRAM PARTICIPATION: EVIDENCE FROM THE NLSY*

We empirically implement a dynamic structural model of labor supply and welfare program participation for agents with potentially time‐inconsistent preferences. Using panel data on the choices of single women with children from the National Longitudinal Surveys (NLSY) 1979, we provide estimates of the degree of time‐inconsistency, and of its influence on the welfare take‐up decision. With these estimates, we conduct counterfactual experiments to quantify a measure of the utility loss stemming from the inability to commit to future decisions, and the potential gains from commitment mechanisms such as welfare time limits and work requirements.     

FISCAL POLICY AND OPTIMAL TAXATION: EVIDENCE FROM A TAX SMOOTHING EXERCISE

Testing the tax smoothing hypothesis for the EU‐15, we hypothesise that the introduction of the 3%‐deficit rule of the Maastricht Treaty in 1993 may have inhibited tax smoothing as European Union (EU)‐member states are no longer capable of letting the deficit grow as much as implied by expected decreases in government expenditure. Our results show that for some countries this fiscal rule may have indeed changed the validity of the tax smoothing hypothesis, thus implying that EU accession has caused welfare losses.     

ENDOGENOUS ECONOMIC POLICY AND THE STRUCTURE OF PRODUCTION: THEORY AND EVIDENCE

This paper develops and tests a model that predicts a positive relationship between absolute levels of capital stock and how favourable are policies toward capital. The theoretical model we use is a model of campaign contributions and electoral competition, extended to consider the implications for factor mobility and hence the structure of production. There are two main predictions. First, countries with more capital stock tend to implement more pro‐capital policies. Second, in a two‐country model, the country that initially has more capital will be able to attract capital inflows from the other country. Given additional assumptions on the production side, this yields the prediction that the more different are countries' policies, the more different will be the set of goods that they produce. These predictions of the model are confirmed using panel data on cross‐state differences in policies and economic outcomes in India.     

JOB REALLOCATION,FINANCIAL CRISES,AND POLICY REFORMS: EVIDENCE FROM KOREA

This article investigates the dynamic process of job reallocation across Korean firms from 1985 to 2013 focusing on how the 1997 Korean financial crisis and the subsequent reforms altered job flows. I find evidence that while job reallocation was moderate and acyclical before the crisis, after the crisis it substantially intensified and exhibited procyclicality. Particularly, the reshuffling of employment across firms from different industries and of different sizes significantly occurred during the crisis period. Examining job reallocation from a geographical perspective, I find that the driving forces of regional job reallocation rates depend on the local heterogeneity of industries and geography. (JEL J63, E32, R10)     

THE J‐CURVE AT THE INDUSTRY LEVEL: EVIDENCE FROM TRADE BETWEEN THE US AND AUSTRALIA*

Previous studies that tested the J‐curve phenomenon for Australia used trade data either between Australia and the rest of the world or between Australia and its trading partners on a bilateral basis. They were unable to find support for the J‐curve in the short run nor any significant relation between the trade balance and the exchange rate in the long run. In this paper we disaggregate the data between Australia and its second largest trading partner, the US, and consider the trade between 108 industries. Using annual data over the 1962–2003 period and bounds testing approach to cointegration and error‐correction modelling, we are able to discover short‐run effects of currency depreciation on the trade balance in 64 industries. The long‐run and positive effects were only evidenced in 35 cases, supporting the J‐curve.     

THE TIME‐SERIES PROPERTIES OF UK INFLATION: EVIDENCE FROM AGGREGATE AND DISAGGREGATE DATA

This paper contrasts the time‐series properties of aggregate and disaggregate UK inflation. While aggregate inflation is found to be non‐stationary, unit root rejection frequencies are increasing when we use more disaggregate data. Structural break analysis suggests that structural shifts in monetary policy could alter inflation persistence. Additionally, panel evidence indicates that the unit root hypothesis can be rejected for sectoral inflation rates. Finally, we compare the persistence properties of UK inflation, finding statistically significant differences between aggregate and disaggregate series. Our analysis suggests that aggregation matters, which has important implications for econometric analysis and the conduct of monetary policy.     

FISCAL DECENTRALIZATION AND ECONOMIC VOLATILITY: EVIDENCE FROM STATE‐LEVEL CROSS‐SECTION DATA OF THE USA*

This paper examines the implications of fiscal decentralization for economic stability. It has been discussed that fiscal decentralization reduces the variance of GDP growth, due to the greater diversification of performance across jurisdictions. We examine this theoretical result using a panel data set of the 50 states of the USA over the period of 1992–1997. We show that the theoretical specification of the production function is supported. We also show a negative significant relationship between fiscal decentralization and economic volatility. The results are robust when we take into account the endogeneity of fiscal decentralization.     

INCOME AND WEALTH INEQUALITY: EVIDENCE AND POLICY IMPLICATIONS

Drawing on the author's work, this lecture presents evidence on U.S. income and wealth inequality. It presents series for top income and wealth shares, and the distribution of economic growth by income groups. It discusses the mechanisms behind the evolution of U.S. income and wealth inequality from historical and comparative perspectives. It analyzes the role of public policy and in particular taxation in the evolution of inequality. (JEL D31, F66, J24)     

MONEY AND INFLATION IN INDIA: EVIDENCE FROM P‐STAR MODEL

This study uses P‐star model to examine the role of money in explaining inflation in India. In particular, we compare the performance of traditional Phillips curve approach against P‐star model in forecasting inflation. Moreover, the study estimates P‐star model using the alternative measures of money such as simple sum and Divisia M3, to examine the relevance of aggregation theoretic monetary aggregates in explaining inflation. The empirical results indicate that P‐star model with real money gap has an edge over traditional Phillips curve approach in forecasting inflation. More importantly, we found that the P‐star model estimated with Divisia real money gap performs better than its simple sum counterpart. These empirical findings suggest that the changes in real money gap play a crucial role in explaining inflation in India.     

内部人交易与股票市场回报——来自中国市场的证据

本文系统地分析了自2007年6月1日以来,我国上市公司内部人的公开市场交易行为。本文的结论表明,在实施了内部人交易监管法规以来,我国上市公司的内部人依然能够利用私有信息在二级市场上赚取超额收益。当内部人购买或出售公司股票时,股票市场都会出现异常反应。而这些超额收益的大小直接受到公司的股权集中度、企业是否为国有等因素的影响。公司治理结构越差,则内部人赚取的超额收益越多。依据上述结论,笔者提出了相应的政策建议。     

USE OF THE MONEY SUPPLY IN THE CONDUCT OF JAPAN'S MONETARY POLICY: RE‐EXAMINING THE TIME‐SERIES EVIDENCE*

This paper re‐examines whether the money supply (M2 + CDs) can predict future economic activity in Japan, using recent data to the end of 2003. I find that the linkage between M2 and income or prices has largely disappeared since the late 1990s. Evidence suggests that (i) time deposit behaviour is primarily responsible for the breakdown in the M2–income relationship; (ii) bank loans also lost their predictive content in the late 1990s; and (iii) there has been a close link between time deposits and bank loans. Non‐performing loans problems and ongoing restructuring may be root causes of these findings.     

INDUSTRY TRADE BALANCE AND DOMESTIC MERGER POLICY: EMPIRICAL EVIDENCE FROM U.S. MERGER POLICY FOR MANUFACTURING SECTORS

The literature on antitrust in an open-economy setting is inconclusive with respect to the role played by trade balance on the tenor of domestic merger policy. Using a panel dataset composed of U.S. merger reviews by industrial sector over the 1982–2001 period, I empirically test the impact of sectoral trade balance on the level of antitrust scrutiny. The results suggest that larger trade balances lead to more vigorous antitrust scrutiny; thus "strategic" merger policy does not appear evident, and consumer surplus appears to guide U.S. merger policy even under the lure of international competitive gains.     

INNOVATION PLATFORMS AND THE GOVERNANCE OF KNOWLEDGE: EVIDENCE FROM ITALY AND THE UK

Innovation is a collective process that entails the coordination of distributed knowledge across diverse organizations. Technology infrastructures provide innovation systems with governance mechanisms to create and sustain complementarities across otherwise dispersed competences. The paper presents innovation platforms as a specific case of technology infrastructure. Operating strategically at the interface between the public and the private sectors, platforms enable capacity- and capability-building for individuals, teams and organizations. Illustrative evidence on innovation platforms in the United Kingdom and Italy confirms the importance of institutional responsiveness to stimulate variety and ensure coordination in the context of collective innovation processes.     

FINANCIAL INNOVATION AND THE DEMAND FOR MONEY: EVIDENCE FROM THE PHILIPPINES

This paper tests whether financial innovations in the Philippines distorted the long-run relation between real money balances, income and interest rates. Using data for the monetary base, M1 and M3 over the period 1980–1998, we cannot reject the hypothesis that there does not exist a standard money demand relation between M1 and M3, real income and interest rates. However, when we allow for the impact of financial innovations, this finding is reversed for M1. Estimates of ECM models for these measures also show that financial innovations impacted real money balances for M1, but not M3. This evidence supports the Philippine central bank's choice of a monetary aggregate as its policy instrument to achieve its policy objectives. [E41, E58]