The impact of electronic commerce on small and midsized spanish companies

Electronic commerce (EC) is not new for some European Union countries, but in others, such as Spain, it is only at the developmental stage. Now that Spain has joined the third phase of the economic and monetary union, Spanish companies' internationalization and the progressive change in the Spanish consumers' buying habits are determining the search for new business strategies. Starting with an analysis of the Spanish business environment, followed by an internal scanning of small and midsized Spanish companies, this paper will analyze the viability of EC as a new business strategy.     

Collective bargaining under perfect information. The negotiation of national agreements

We structurally estimate a perfect information bargaining model of collective negotiations using data on national agreements for Spain. The model is a stochastic model of sequential bargaining in which we allow for the possibility of negotiations ending without agreement, a common feature in the data. Delays in equilibrium are the result of uncertainty about the surplus to be divided among the players and not of information asymmetries. The model fits the data well regardless of the limitations imposed by the parametric specification adopted. Our results show that agents are patient and that the advantage from proposing is large.JEL Classification: J50, C73, C78We thank Fabian Marquez, Sergio Santillan and Jose Maria Zufiaur for helping us to create the data base on Spanish National Agreements. We also thank Cesar Alonso, Juanjo Dolado, Gautam Gowrisankaran, Maia Guell, Antonio Merlo and participants at the 1999 European Meeting of the Econometric Society for very helpful comments. Jose E. Galdon thanks financial support from the following institutions: European Commission for a TMR Marie Curie Fellowship, Spanish Ministerio de Ciencia y Tecnologia for project BEC2002-00954 and Spanish Ministerio de Educacion, Cultura y Deporte for project PR2004-0057. He also thanks the hospitality of STICERD (LSE) and the IR Section (Princeton University) where part of this work was completed. The usual disclaimers apply.     

The sustainability of fiscal policies in the European Union

This paper examines the stationarity of the inclusive-of-interest public deficit for five European Union economies, four of them being recently selected for entry into the European Monetary Union. Unit root tests are used not only to examine structural breaks and cointegration analysis, but also to investigate for regime shifts. They support the occurrence of sustainable deficits for the Greek, Spanish, and Portuguese economies. On the contrary, Italy and Belgium may incur unsustainable deficits, implying that their selection in Phase 2 of the European Monetary Union is questionable. This paper was presented at the Forty-Fifth International Atlantic Economic Conference, Rome, Italy, March 14–21, 1998.     

Economic inequality in Spain: the european community household panel dataset

This article uses data from the 1998 European Community Household Panel to study economic inequality in Spain. It reports data on the Spanish distributions of income, labor income, and capital income, and on related features of inequality, such as age, employment status, educational attainment, and marital status. It also reports data on the income mobility of Spanish households, and data on income inequality in other European countries and in the US. We find that income, earnings, and, especially, capital income are very unequally distributed in Spain and that economic inequality in Spain is well above the European average.     

The Border Effect and the Nonlinear Relationship between Trade and Distance

The border‐effect literature confirms that sub‐national units tend to trade more with the rest of their country than with foreign markets. However, it is likely that ongoing processes of trade integration will generate a trade‐off between internal and external integration for sub‐national units within countries. In this paper we estimate the internal and external border effect, using a novel dataset that captures intra‐ and international shipments between Spanish regions and regions in eight European countries with alternative treatments of the nonlinear relationship between distance and trade.     

The Spanish Labour Market: Reforms and consequences

The institutional design of the Spanish labour market has been subjected, during the last three decades, to permanent pressure fuelled by two beliefs. On the one hand, by the assumption that a higher degree of flexibility would help to reduce unemployment; on the other, by the assumption that such increased flexibility would also help to reduce inflation rates and, consequently, the inflation gap between Spain and the rest of the European countries. The recent history of the Spanish labour market is, therefore, the history of the reforms implemented to increase the flexibility in such a market. The aim of this paper is, firstly, to describe the main features of these reforms, showing the measures implemented in order to increase the flexibility in the labour market and, secondly, to show the degree of flexibility reached in the labour market. Finally, we will briefly analyse the macroeconomic consequences of these reforms.     

Trade liberalization and industrial structure in Spain: An applied general equilibrium analysis

We empirically evaluate the aggregate welfare effects and structural adjustment for the Spanish economy that would follow from trade liberalization with the European Economic Community. Recent theory suggests that the classical gains form more liberal trade relations could be amplified substantially if EEC liberalization permits Spanish industries to realize economies of scale. These effects depend upon the extent of trade creation and trade diversion resulting from preferential liberalization, which in turn depend on the existing patterns of Spanish resource allocation, trade, and comparative advantage. The estimated results are derived from disaggregated microeconomic model of the Spanish economy. We find that increasing returns can actually be beneficial or detrimental, depending upon the interactions between trade and policy toward domestic industry.     

The dynamic adjustment of local government budgets: does Spain behave differently?

The aim of this article is to analyse whether Spanish municipalities adjust in response to budget shocks and (if so) which elements of the budget they are more likely to adjust. The methodology we use to answer these questions is a Vector Error Correction Model (VECM), estimated with data from a panel of Spanish municipalities during the period 1988 to 2006. Our results confirm that Spanish municipalities do indeed make adjustments in response to fiscal shocks (i.e. the deficit is stationary in the long run). We compare our results with those obtained for US and Germany to evaluate if the viability of local finance depends on the institutional arrangement and to analyse how it affects the adjustment patterns. We observe that grants have a more important role in the adjustment process in environments where either they have an equalization objective or where there is no clear rule that determines their distribution. This fact can generate a moral hazard problem: governments tend to spend more due to the expected intervention by the central government. Own revenues have a lower adjustment capacity in environments where subcentral governments have limited fiscal autonomy. These results, however, suggest that the viability of the local finance system is feasible with different institutional arrangements.     

Stock market cycles and stock market development in Spain

In this paper we use Spanish stock market data to identify the bull and bear phases of the market and to analyze its characteristics during the period 1941-2002. We compare these characteristics with those of the US and of two other European countries (Germany and the UK). Our sample is divided in two subperiods in order to account for differences induced by the process of development undergone by Spanish capital markets in the late 1980s and early 1990s. We find that the Spanish stock market has become increasingly more similar to those of the more developed countries, although some differences still persist. Additionally, we show that concordance of the Spanish stock market with other developed markets has increased quite significantly.JEL Classification: C22, G15An earlier version of the paper circulated under the title Bulls and bears: lessons from some European countries. Comments from seminar participants at the Universidad de Navarra, at the IX Meeting of the Spanish Finance Association (Pamplona 2001) and at the Royal Econonomic Society Conference (Warwick 2002) are gratefully acknowledged. We are very grateful to J.M. Campa, G. Llorente and two anonymous referees for helpful comments and suggestions. We also thank D. Garcia and the Research Department of the Madrid Stock Exchange for generously providing the data of the Spanish case. Financial assistance from the Spanish Ministry of Science and Technology (SEC2002-01839) is gratefully acknowledged. The usual disclaimer applies.     

Portfolios in the Ibex 35 before and after the Global Financial Crisis

In this article, we present an analysis of the effectiveness of various portfolio optimization strategies applied to the stocks included in the Spanish Ibex 35 index, for a period of 14 years, from 2001 until 2014. The period under study includes episodes of volatility and instability in financial markets, incorporating the Global Financial Crisis and the European Sovereign Debt Crisis. This implies a challenge in portfolio optimization strategies since the methodologies are restricted to the assignment of positive weights. We have taken for asset allocation the daily returns with an estimation window equal to 1 year and we hold portfolio assets for another year. This article attempts to influence the discussion over whether the naive diversification proves to be an effective strategy as opposed to portfolio optimization models. For that, we evaluate the out-of-sample performance of 15 strategies for asset allocation in the Ibex 35, before and after of the Global Financial Crisis. Our results suggest that a large number of strategies outperform to the 1/N rule and to the Ibex 35 index in terms of return, Sharpe ratio and lower VaR and CVaR. The mean-variance portfolio of Markowitz with short-sale constraints is the only strategy that renders a Sharpe ratio statistically different from Ibex 35 index in the 2001–2007 and 2008–2014 time periods.     

The Nature of Institutional Change in Transition

Contemporary empirical evidence of transition in Central and East European countries proves the importance of institutional change, as was claimed by advocates of this field of transition. The article assesses institutional change in the first phases of transition from the perspective of competing strategies: rapid changes versus gradualism. After pointing to some inconsistencies in this debate, the article discusses the possibility and prospects for development of a market for institutions in European transition countries. The main criterion which is used is the requirement for the rule of law as one of the foundations of a market economy. It concludes that undeveloped endogenous factors of institutional change still do not enable development of markets for institutions. Reluctance of national governments to act according to a long-run perspective is at present to a certain extent compensated by the presence of external factors of institutional change.     

Treasury auctions in Spain: a linear approach

Abstract. The majority of Treasuries use discriminatory auctions to sell government debt. A few Treasuries use uniform auctions. The Spanish Treasury is the only one that uses a hybrid format of discriminatory and uniform auctions. All Treasury auctions are multiple-unit multiple-bid auctions, usually assumed to be common and unknown value auctions. Taking in account these features, we analyze the Spanish auction format, taking a linear approximation to bidders' multiple bids, and characterize a parameter set in which the Spanish format gives higher expected seller's revenue than discriminatory and uniform auctions. Policy implications are obtained by calibrating theoretical results with data. We thank S. Nu?ez, and seminar participants at GREQAM, CEFI, the 1999 CEF meeting in Boston and the 57th European Meeting of the Econcometric Society for suggestions. We are especially grateful to two anonymous referees for detailed comments that greatly improved the paper. Any error is our responsability. The authors express their thanks for financial support to Ministerio de Ciencia y Teconologia from Proyecto SEC2000-0723, n_o 9114.     

Cross-border cooperation: A response to the challenges facing agri-food cooperatives in Southern European countries

All agri-food cooperatives share common interests, irrespective of their geographical borders, which should encourage them to undertake inter-cooperation processes as well as to set up transnational cooperatives. This paper has two objectives. The first is to analyze Spanish and Portuguese cooperative regulations and the Statute for a European Cooperative Society to define how to embark on these processes in the two countries while also pinpointing the conflicts that may arise from the different regulations. Secondly, it seeks to ascertain which Spanish and Portuguese cooperatives have had experience in this field and to characterize them through a multiple-case study, including the rationale for the processes, the advantages and the constraints. The results have revealed five cross-border cooperation categories and show that the Statute for a European Cooperative Society has not had the expected success at the EU level, due to its complexity. However, in general, the lack of expected cross-border cooperative experiences is not due to legal, language or management issues. It is for different reasons. Firstly, cooperatives think that they can achieve the same objectives through inter-cooperative agreements. Secondly, government policies protect the regional nature of their cooperatives, rather than encouraging them to expand their business and therefore their capacity to respond to current challenges.     

Fiscal and regulatory federalism in the European Union

This contribution summarizes some quantitative results and presents relevant policy-oriented conclusions obtained from research program No. PBS91-0363. It is mainly supported by the Inter-ministerial Committee on Science and Technology of the Spanish government, which was carried out at the Public Finance and Public Sector Economics Research Unit of University of Valencia (Spain) to analyze, from a fiscal and regulatory point of view, the dynamic characteristics of federalism in the European Union. The research was performed in order to contribute to the establishment of the basis for the acceleration of the economic European integration and the future constitution of the United States of Europe.     

Alcohol demand among young people in Spain: an addictive QUAIDS

This paper analyzes the demand for alcoholic beverages among young people in Spain. To that end, we develop a theoretical model which combines elements from the Theory of Two-Stage Budgeting and the Theory of Addiction, with this being empirically translated into a Quadratic Almost Ideal Demand System (QUAIDS) in which the particular characteristics of young people are introduced by Price Scaling (PS) techniques. We then estimate this specification by using data drawn from the Spanish National Survey on Drug Use in the School Population (2000) and the Spanish National Household Survey (2000). Given that wine, beer and spirits all have normal demands, our results suggest that a tax increase imposed with the intention of reducing alcohol consumption would appear to be efficient. This paper was partially written while Ana Isabel Gil was a Visiting Researcher at the London School of Economics and Political Science, to which she would like to express her gratitude for the hospitality and facilities provided. An earlier version of this paper has been presented at the Spanish Economic Analysis Meeting-2003 (Sevilla, Spain) with all the comments made by the participants being appreciated. Finally, the authors would like to express their thanks for the financial support provided by the Spanish Ministry of Education-CICYT and the European Commission (Project 2FD97-2057). The usual disclaimer applies.     

Human capital and economic growth in Spanish regions

Modern economic growth theory has emphasized on the human capital effects on economic growth. In this case, the externalities from a better education could enhance economic growth process and facilitate the progress in different regional areas. The main objective of this paper is to analyze the effects of human capital on economic growth process by taking into account the case of Spanish regions. The authors examine whether a better education process and social capital can improve the economic growth process in such area and if it can explain the differences in per capita GDP existing in those regions. The paper uses data from Spanish Statistical Institute and from different institutes of the European Union. The Castilla La Mancha Regional Government has provided financial support for the Project PDI-02-025.     

PUBLIC CAPITAL, PRODUCTIVE EFFICIENCY AND CONVERGENCE IN THE SPANISH REGIONS (1964–93)

This paper analyses the behaviour of productive efficiency in the Spanish regions for the period 1964–93. From a growth accounting approach, it describes the regional evolution of total factor productivity (TFP'), based on a private inputs production function. A stricter measure of efficiency is then quantified, which is not equivalent to Solow's residual, since public capital is included in the production function and constant returns to scale are not imposed. Finally, on the basis of the measures of total factor productivity and efficiency, the study discusses the existence of technological convergence among Spanish regions and the role played in it by public capital. The renewed interest in the analysis of the process of growth reflected in economic literature in recent years has also occurred in the case of the Spanish economy, with some peculiarities which are worth mentioning. In the 1980s, two important institutional changes took place: a profound political and administrative decentralization, the regions now being autonomous in many decisions on public expenditure, and the incorporation of Spain into the European Community, which as it is well known has a powerful regional policy. Both changes have meant that the analysis of regional economies, and especially their growth paths, have received much more attention from politicians and economists, and even from the population in general. In particular, intense discussion has taken place regarding the effects of development policies and on criteria for geographical distribution of infrastructures. In both cases, much attention has been paid to discussing their capacity to contribute to convergence among the different regions. As a consequence of this greater interest in the analysis of growth from a regional perspective, efforts have also been made to improve the relevant statistical information. In particular, statistical series have been drawn up for investment and accumulated capital stock in each region, both private and public.' This information, only recently available and the first of its kind, as far as we know, in the European regions, substantially broadens the possibilities of research into the Spanish case in this field, where before not even the simplest exercises in growth accounting could be attempted. Further-more, since the series now available allow the time dimension of growth analysis to be combined with the regional dimension, it is possible to work with a panel of data and apply the corresponding techniques. This article analyses the growth of the Spanish economy over the period 1964–93, during which it can be observed that the per capita income levels of the Spanish regions converged. The objective of the study is to evaluate this process of convergence in income from the perspective of the productive efficiency of the regions, in three different ways. First, Section I considers the importance of the contributions of the private factors of production and of improvements in total factor productivity to the growth of output. Secondly, section II studies the existing relationship between the standard measure of efficiency (Solow's residual or TFP') and a stricter measure when the endowments of public capital are considered. Section III analyses whether or not the convergence in per capita income     

An Incentive Water Pricing Policy for Sustainable Water Use

By adopting the Water Framework Directive (WFD), the European Commission (EC) and the European Council made recommendations for water pricing policies in European Union (EU) member states with a view to enhancing the sustainability of water resources. Clearly, the directive integrates economic instruments in environmental policies to provide incentives for the sustainable use of water resources. Our analysis will focus on public water utilities, required to be financially self-sufficient, facing demand and capacity shocks. The paper deals with the simultaneous determination of incentive pricing policies and investment rules under an ex~ante maximum demand charge. We will characterize the welfare-optimal capacity selection rule and the welfare-optimal maximum demand pricing rule. Heterogeneous consumers demands are considered when tariffs are set ex~ante, before demands are known. Our results are state-contingent nonlinear pricing that responds to demand fluctuations and capacity constraints.      

Trade Effects of European Union Enlargement: an ex post model of trade between Spain and Latin America

Past research on European Union (EU) Enlargement has tended to neglect the effects on trade with non-preferred trading partners. This paper examines the consequences of EU enlargement on trade between Spain and the Latin American countries with which it has traditional economic and cultural ties. An import demand functions model was estimated for the period 1964–93. The country-level results showed that Spanish accession to the EU only had large adverse effects on its imports from Argentina. The results for non-agricultural products indicated a general absence of negative effects on Spanish imports. The aggregate results from the ex post model provide support for some, but not all, of the ex ante predictions of previous studies.     

Spanish regional policy: Economic and social cohesion in the European union

The aim of this paper is to analyze the economic and social cohesion from the Spanish perspective. The hypothesis is that the economic and social cohesion in the European Union needs three requirements. First, the Structural Funds, European Regional Development Fund, European Social Fund and European Agricultural Guide, and Guarantee Fund, increase their weight in the community budget. Second, the resources of those funds must be concentrated on the lesser developed regions. Third, each region assigns its resources to the improvement of the factors that contribute to its backwardness (quality of human capital, innovation, development, and managerial initiative). The analysis is based on the first and second Community Support Framework [CSF 1989–93 and CSF 1994–99].An earlier version of this paper was presented at the Fifty-Third International Atlantic Economic Conference, March 13–17, 2002, Paris, France.