The impact of corruption on FDI: is MENA an exception?

The eruption of the Arab Spring in Tunisia and Egypt was ensued by deterioration in FDI inflows. Whether a new Middle East free of corruption accompanying previous dictatorships will offset the negative ramifications of the uprisings and enhance FDI in the long run remains debatable. Since the evidence on the causal relationship between corruption and FDI is inconclusive, this study attempts to take another step. The paper investigates the link between corruption and FDI flows to the Middle East and North Africa (MENA) and assesses whether or not corruption has more importance than other FDI determinants. By employing several panel settings with various econometric specifications on 21 MENA countries over the period 2003 to 2009, it is demonstrated that FDI varies positively with corruption. Additionally, FDI in MENA was found to vary positively with per capita income, openness, freedom and security of investments and negatively with the tax and homicide rates. Since corruption was not found to hinder FDI inflows, treating corruption should be based on sound legal procedures that infringe neither on the rights, freedom and security of FDI nor on the degree of openness and freedom of the economy, which are the real stimulants of FDI in MENA.     

The appeal of voluntary environmental programs: which firms participate and why?

Why do firms participate in the EPA's voluntary environmental programs? Possible reasons include: (1) to appeal to consumers who demand ‘green’ products; (2) to preempt government regulation; (3) to seek regulatory relief from the agency; and (4) to gain a competitive advantage over competitors. This article examines the determinants of participation in voluntary environmental programs, focusing on testing hypotheses 1 and 3. To test 2, a different approach is used than in previous literature. The focus is on a specified universe of firms (manufacturing firms in the Standard & Poor 500), and their participation in each of three EPA voluntary programs (33/50, Green Lights, and WasteWi$) referring to differently regulated pollutants is analyzed. Our empirical analyses reveal that (1) publicity is an important component of participation; (2) the worse the environmental track record of the firm, the more likely the firm is to participate, but only in programs directly related to highly regulated pollutants; and (3) firms that scrutinize their environmental performance more carefully are wary of newer programs with uncertain reach of the public and uncertain benefits. Firms appear to value the information/technology transfer aspect of joining a program.     

The impact of aid on growth revisited: Do donor motives matter?

The typical identification strategy in aid effectiveness studies assumes that donor motives do not influence the impact of aid on growth. We call this homogeneity assumption into question, constructing a model in which donor motives matter and testing the assumption empirically.     

Lotto nothing? The budgetary impact of state lotteries

Lottery revenues are often touted as an independent revenue source for states. Using 32 years of state financial data, the fallacy of such thinking is demonstrated. Being the first to control for the self-selection of being a lottery state, it is found that overall tax revenues decline with increased lottery sales. Moreover, it is discovered that this decline is driven by a decrease in revenues from general sales and excise taxes, which is only partially offset by increases in income tax receipts. Such findings are attributed to a combination of behavioural and political responses following the lottery's implementation.     

The impact of monetary policy on local housing markets: Do regulations matter?

This paper shows that monetary policy has uneven impacts on local housing markets, and that the magnitude of the impacts are correlated with housing supply regulations. We apply the linearized present value model, which allows the log rent–price ratio to be decomposed into the expected present values of all future real interests rates, real housing premia, and real rent growth, to the housing markets in 23 US metropolitan statistical areas. Based on the indirect inference bias-corrected VAR estimates, we find that MSAs that are more regulated have (i) a higher variance in the log rent–price ratio, (ii) a larger share of the variance explained by real interest rate, and (iii) a stronger impulse response of house price to the real interest rate shock.     

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.     

Legal regulation of enterprises＇ environmental impact：a survey

The enterprise coordinates social resources, which changes the dialogue between human and the environment into that between enterprise and environment. The profit-making character of enterprise leads to the abandonment of environmental ethics. Enterprise, which has the capability to solve environmental problems, however, lacks the motive to do it. It has controlling power over society and should assume the responsibility of environmental protection. For its lack of environmental conscience, the external institutional arrangements should be made for enterprise. The strategy for environmental cost should be designed in connection with the interest orientation of enterprise. And various legal measures in constitutional law, social law, civil law, administrative law and criminal lave should be utilized to regulate enterprise＇s behaviors regarding environmental protection.     

A new insight into environmental innovation: Does the maturity of environmental management systems matter?

Technological innovation has recently become more essential than ever. To examine the factors that might induce environmental technological innovation, we focus on ISO 14001, a voluntary approach to environmental management, and scrutinise how the proficiency or maturity level of ISO 14001 in facilities influences environment-related research and development (R&D) expenditures that promote environmental technological innovation. We measure the maturity level based on the length of time since a given facility adopted ISO 14001. Using Japanese facility-level data from “Environmental Policy Tools and Firm-Level Management and Practices: An International Survey” (OECD Survey), we estimate two Tobit models by addressing an endogeneity issue in ISO 14001. The estimation results provide empirical evidence that as the ISO 14001 is improved in facilities, those facilities are likely to spend more on environmental R&D. The facility age and market concentration also positively affect environmental R&D. These findings suggest that the maturity level of ISO 14001 is an important factor influencing the investment in environmental R&D.     

The impact of hiring top workers on productivity: what is the role of absorptive capacity?

We examine the heterogeneous productivity impacts of hiring top workers on small and medium-sized enterprises, exploiting matched employer–employee panel data and employing within-firm as well as matching and difference-in-difference estimators. The results provide robust evidence that the productivity impact is stronger for firms with higher absorptive capacity. Technological laggards within an industry benefit more strongly from hiring top workers if their workforce is more well-educated.     

Does student employment really impact academic achievement? The case of France

Student employment is usually thought to curb academic achievement. Our research relating to a survey at a French university in 2012 emphasizes the significance of the intensity of student working hours. Allowance for the endogeneity of student employment reinforces the negative effects, particularly for young people working more than 16 hours a week. However, the academic achievement of those working fewer than 8 hours per week seems unaffected. The type of employment also affects the chances of success: students with public sector jobs appear to be less prone to failure, possibly because of more flexible working hours.     

The economic and environmental performances of rural districts in Italy: Are competitiveness and sustainability compatible targets?

This paper analyses the economic performances of the rural system and the level of land sensitivity to degradation in Italy. Three indicators (district value added, share of agriculture on total product, and a composite index of land sensitivity) were used to classify 784 Italian local districts into eight performance classes. Four classes share a combination of high environmental quality (in terms of land degradation), high (or low) economic performances, and high (or low) productivity of the primary sector. The remaining four are characterised by a combination of low (and declining) environmental quality, high (or low) economic performances, and high (or low) productivity of the primary sector. The eight classes were grouped into four ‘environmental quality’ types and four ‘target performance’ categories to discriminate among high- and low-performance districts by considering twelve additional variables within a Discriminant Function Analysis (DFA). 148 high environmental performance districts (18% of total) were identified mainly across the Alps and Apennine while 314 districts (41%) were classified in the lowest performance class and concentrated in flat areas of southern Italy. The districts with high environmental performances were characterised, on average, by medium to low district value added, moderately low economic weight of the primary sector, and tourism specialisation. Districts with high economic performances and low environmental performances were characterised by high sensitivity to LD, low district value added, high share of agriculture in total product, and the lowest productivity of labour in all economic sectors. In these districts the risk of entering a downward spiral of rural poverty and environmental degradation is potentially high.     

The impact of license regulation on the number of recreation trips: is it worth considering?

A two-stage nonlinear least-squares model (2NLS) with an endogenous treatment effect on recreation trips describes the behavior of recreationists with and without a fishing/hunting license. The proposed 2NLS is applied to the derivation of the policy-relevant average gains in the presence of an endogeneity bias to a license fee implementation program regulated by states. Recreationists who purchased a license are likely to recreate more than are the nonlicensed holders because the regulation may reduce congestions at sites where licensee visit often. The license regulation has a greater impact on the use of natural resources after controlling observed and unobserved confounders which might be correlated with the probability of being a license holder and with the final outcome, the number of recreation trips. We confirm that the individual without a permit regards the recreation trip as less valuable than does the individual having a license permit. We also found that the likelihood of purchasing a license among young adult recreationists is not at the level the states may desire. In addition, the number of trips demanded is more responsive to the nontransportation-related implicit travel cost than to the transportation-related implicit travel cost, although travel implicit costs are price inelastic.      

Do funding sources matter?: The impact of university-industry collaboration funding sources on innovation performance of universities

ABSTRACT

The nature of funding sources for university-industry collaboration (UIC) has gradually changed, which may motivate universities to pursue different goals. Therefore, a question arises concerning whether and how funding sources influence the innovation performance of universities. This study explicates this relationship by using organisational control theory. Results of structural equation modelling using partial least squares based on a sample of 146 Taiwanese universities revealed that both governmental and industrial funding facilitated UIC management mechanisms and regulation implementation, which subsequently influenced the innovation performance of universities. Moreover, governmental funding has a greater impact on implementing UIC regulations and industrial funding has a greater impact on building UIC management mechanisms. The results also revealed that only industrial funding exerts a positive influence on the innovation climate of a university. Policy implications are discussed at the end of this paper.     

Exchange rate undervaluation and manufactured exports: A deliberate strategy?

Recent literature suggests that a proactive exchange rate policy in accordance with price incentives (i.e. undervaluation) can foster manufactured exports and growth. This paper is built on these recent developments and investigates, using a sample of 52 developing countries, whether such a proactive exchange rate policy is adopted. The results show that during the period 1991–2005 a number of countries has used undervaluation to foster the price competitiveness of manufactured exports.     

The impact of economic sanctions on international trade: How do threatened sanctions compare with imposed sanctions?

We draw on established theoretical works in international political economy to compare the empirical effect of threatened and imposed economic sanctions on international trade. To deepen the analysis, we analyze whether there are any differential effects when different instruments of sanctions are employed, as well as whether the effect of sanctions is product specific. To do this, we use the gravity model and recent detailed disaggregated data on sanctions spanning the period 1960–2009. Our results show that the impact of threatened sanctions differs qualitatively and quantitatively from imposed sanctions. Whereas imposed sanctions lead to a decrease in the trade flow between the sender and its target, a threat of sanctions leads to an increase. The positive impact of the threat may be due to economic agents in both the sender and its target resorting to stockpiling prior to the actual imposition of sanctions to minimize any adverse consequences of the sanctions. These differential effects of threatened and imposed sanctions also extend to food and medicinal products, as well as when different instruments of sanctions are employed.     

The impact of EEOC enforcement on the wages of black and white women: does class matter?

The procedures used by the EEOC have been broadly criticized. The critiques are that the EEOC does not completely investigate all charges, and does not apply the law to the fullest benefit of discrimination victims. This paper contributes to these critiques with a finding that, among women, benefits from EEOC enforcement are funneled to white women and black women with relatively high levels of education. This distribution of benefits is due to the EEOC’s investigation procedures.     

What Would Korea-US Free Trade Agreement Bring?

ABSTRACT

This paper uses a computable model of trade to forecast the effects of the US–Korea free trade agreement on the manufacturing sector. The model uses the Eaton–Kortum methodology to explain intra-industry trade instead of the usual Armington assumption. It is parameterized using 2005 data for 15 industries and 53 countries. The results show that implementing KORUS would increase the US manufacturing exports to Korea by 56.9% and Korean manufacturing exports to the US by 18.9%. It would also increase manufacturing employment by 26,500 jobs in Korea and 34,200 jobs in the US. In addition, KORUS would lead to significant changes in the patterns of trade and production. The US and Korea would increase their specialization in the industries where they have strong technological comparative advantages. Finally, KORUS would increase welfare in both countries, but only modestly: by 0.27% in Korea and 0.013% in the US.     

Responding to environmental risks: What can Albert Hirschman contribute?

As for many problems of a social nature, behaviour in the face of environmental risk is likely to take two major forms: on the one hand, the expression of dissatisfaction, on the other hand, distancing in relation to the problem; voice in the first case, exit in the second. The result of this observation is that the idea originated by Albert Hirschman in Exit, Voice, and Loyalty can seem to be appropriate for analysing individual and collective reactions, in the face of environmental risks. This is the hypothesis defended in this article. After a general presentation of Hirschman's analytical schema and a few of the debates it has provoked, we consider an application to the case of a polluting factory in the mining basin of Nord - Pas de Calais (France). For this case study, we try to show the particular forms of voice and exit and their articulation. We then consider a generalisation, by emphasising four key variables in the analysis: scale of damages, geographical area of the problem, uncertainty content, and complementarity with other issues.