FOOD SECURITY AND LOW‐INCOME HOUSEHOLDS IN THE MALAYSIAN EAST COAST ECONOMIC REGION: AN EMPIRICAL ANALYSIS

This research, conducted to analyze the level of food security among poor and low‐income households in the east coast economic region of Malaysia, uses primary data of 460 families from the E‐Kasih poor households database, based on a cluster random sampling technique. Food security levels were measured using the United States Agency for International Development Household Food Insecurity Access model. Findings indicate that 52.8% of households are food secure, 23.3% mildly food insecure, 14.3% moderately food insecure, and 9.6% are severely food insecure. These findings are very important to assist policymakers to achieve Vision 2020 and the targets of Malaysian National Plans regarding food security, socioeconomic development, and the alleviation of poverty. The involvement of private sector and community‐based organizations are important to combat short run, seasonal, and event‐related risks, as well as for the development of appropriate mitigation and adaptation options to ensure sustainable food security at household level in Malaysia.     

THE DISTANCE PUZZLE AND LOW‐INCOME COUNTRIES: AN UPDATE

The ‘distance effect' measuring the elasticity of trade flows to distance has been found to be rising since the early 1970s in a host of studies based on the gravity model, leading observers to call it the ‘distance puzzle'. However, this puzzle is regularly challenged by new developments in the specification of the gravity equation or in its estimations. We propose an original survey on the existing methods used to quantify the distance puzzle – basically the computation of an average distance of trade, a meta‐analysis on existing gravity papers and the implementation of recent econometric developments, all on a well‐specified gravity equation both in cross‐section and panel data. We apply all these methods to a unique large database (124 countries from 1970 to 2006). It appears that if all these new developments can change the amplitude of the increase in the trade elasticity to distance, none solve the distance puzzle. We confirm the existence of this puzzle and identify that it only applies to low‐income countries which exhibit a significant rising distance effect on their trade of around 18% between 1970 and 2006 while the distance ‘puzzle' for trade within richer countries disappears.     

THE IMPACT OF LABOR MARKET REGULATION ON EMPLOYMENT IN LOW‐INCOME COUNTRIES: A META‐ANALYSIS

Controversy over labor market policy often centers on achieving a balance between preventing worker exploitation, and avoiding loss of productivity or employment through excessive regulation. Although the literature documenting the impact of labor market regulation on employment is extensive, there is a dearth of evidence on the impact of such policies in low‐income countries (LICs). Since it is easier for workers, especially women, to slip into the informal sector in LICs, regulations are likely to have stronger impacts on formal employment in these countries (but lower impacts on unemployment). We systematically reviewed available research from countries that are, or were until recently, LICs. Most studies document that more stringent labor regulations are associated with lower formal sector employment and higher informal sector employment. We also conducted a metaregression analysis of the impact of minimum wages on formal and informal employment. After controlling for publication bias, higher minimum wages are associated with lower formal employment and a higher share of informal workers.     

THE REGULATION OF PRIVATE SCHOOLS SERVING LOW‐INCOME FAMILIES IN HYDERABAD,INDIA: AN AUSTRIAN ECONOMIC PERSPECTIVE1

It is the intention of government that private schools in Hyderabad are prevented by regulation from exhibiting the basic manifestations of competitive markets ‐ low prices, innovation, good service and so on. However, private schools do, in practice, manifest these features. This paradox is resolved because regulations are not enforced in practice, with the acceptance of bribes by government officials being common. As a result of ‘extra‐legal’ activity, private schools are able to offer a better service to the poor than if regulations had been enforced.     

FURTHER EVIDENCE ON THE SPATIO‐TEMPORAL MODEL OF HOUSE PRICES IN THE UNITED STATES

Holly, Pesaran, and Yamagata (Journal of Econometrics 2010; 158 : 160–173) use a panel of 49 states over the period 1975–2003 to show that state‐level real housing prices are driven by economic fundamentals, such as real per capita disposable income, as well as by common shocks, such as changes in interest rates, oil prices and technological change. They apply the common correlated effects estimator of Pesaran (Econometrica 2006; 74 (4): 967–101), which takes into account spatial interactions that reflect both geographical proximity and unobserved common factors. This paper replicates their results using a panel of 381 metropolitan statistical areas observed over the period 1975–2011. Our replication shows that their results are fairly robust to the more geographically refined cross‐section units, and to the updated period of study. Copyright © 2013 John Wiley & Sons, Ltd.     

THE RECENT REGULATORY RESPONSE TO CORPORATE ECONOMIC CRIME IN THE UNITED STATES: OBSERVATIONS AND COMMENTS

Corporate economic crime, including accounting and auditing fraud and inappropriate behaviour by directors on the boards of US corporations, has resulted in stockholder financial losses and the loss of confidence in investing in the US stock market. We observe the modern corporation with its absentee ownership and professional management team and discuss its inherent incentives to commit management crime. In spite of financial reporting, audits and the use of boards of directors to represent stockholders, management misbehaviour persists. We conclude that the failure of these potential remedies is due to a lack of independence from management in their execution. We comment on some of the provisions of the Sarbanes–Oxley Act, enacted in 2002, and their potential to mitigate some of these conflict of interest conditions.     

ETHNICITY AND THE IMMIGRATION OF HIGHLY SKILLED WORKERS TO THE UNITED STATES

This paper examines ethnicity among highly skilled immigrants to the United States. The paper focuses on five classic components of ethnicity - country of birth, race, skin color, language, and religion - among persons admitted to legal permanent residence in the United States in 2003 in the three main employment categories (EB-1, EB-2, and EB-3), using data collected in the U.S. New Immigrant Survey. Initial findings include: (1) The visa categories have distinctive ethnic configurations. India dominates EB-2 and European countries EB-1. (2) The ethnicity portfolio contains more languages than religions. (3) Language is shed before religion, and religion may not be shed at all, except among the ultra highly skilled of EB-1. (4) Highly skilled immigrants are mostly male; they are not immune from lapsing into illegality; they have a shorter visa process than their cohortmates; smaller proportions than in the cohort overall intend to remain in the United States. (5) Larger proportions in EB-2 and EB-3 sent remittances than in the cohort overall. (6) A little measure of assimilation - using dollars to describe earnings in the country of last residence, even when requested to use the country's currency - suggests that highly skilled immigrants are more likely to "think in dollars" than their cohortmates. Further work is taking a deeper look at these patterns in a multivariate context, attentive to selectivity processes and the Globalista impulse.     

A PATCHWORK SAFETY NET: A SURVEY OF CLIOMETRIC STUDIES OF INCOME MAINTENANCE PROGRAMS IN THE UNITED STATES IN THE FIRST HALF OF THE TWENTIETH CENTURY

Abstract Social welfare programs in the USA are designed to serve as safety nets for people in hard times, in contrast with the universal approach found in many other developed western nations. In a survey of cliometric studies of social welfare programs in the USA, we examine the variation in the safety net in the USA across states in the 20th century, the determinants of the variation and its impact on socioeconomic outcomes. The USA has always displayed substantial variation in the extent of the safety net because the features of most public social welfare programs have been and currently are determined by local and state governments, even after the federal government became involved in the 1930s. Differences across states persist strongly for typically a decade, although the persistence weakens with time, and there are some periods when federal intervention led to a re‐ordering. The rankings of state benefits differ from program to program, and economic and political factors have different weights in determining benefit levels in panel data estimation of their effects. Variation in benefits across programs during the early 1900s had significant impact on labour markets, economic activity, family formation, death rates and crime.     

STATE TECHNOLOGY PROGRAMS AND INDUSTRY EXPERIENCE IN THE UNITED STATES*

Because of the growth of new technology based economic development policies at the state level in recent years, this research project provides an assessment of the experiences of users of one such program: the technology research center in microelectronics. A survey of a large number of companies gave us results that should be of interest to decision makers in universities, private industry as well as the public sector. Access to students as future employees was seen as a major reason why companies get involved with universities, more so than research enhancement per se. A univerisity's inability to protect what companies see as confidential research is seen as a major disincentive to further university-industry relationships, while most companies did not see federal or state tax incentives as encouraging collaboration. Among companies who had direct experience with state-funded technology center programs, most reacted positively to their experiences. Such collaboration was seen to stimulate related research within many participating companies, while also leading to improvements in the quality of products and production methods. While the majority of companies thought that states should continue to fund technology development programs, particularly at universities, neither universities nor government were seen as important sources of technical knowledge by many companies. A lack of information about state programs was seen among many companies that responded to the survey.     

THE ORGANIZATION OF INNOVATION IN THE UNITED STATES AND JAPAN: NEOCLASSICAL AND RELATIONAL CONTRACTING*

This article discusses the role of intermediate governance structures between vertically related industries in the specific context of technological innovation. In the United States, relations between firms in vertically related industries correspond closely to the neoclassical contracting model, characterized by arms-length, spot contracting on the open market. In Japan, inter-firm relations are more likely to involve relational contracting, characterized by stable bonding mechanisms and a dense historical network of economic ties between the parties to the exchange. We focus upon the kinyu keiretsu type of relational contracting between firms of unequal size and power in vertically related industries, which is a special case of the more generally studied kigyo shudan, or inter-market financial group. For illustrative purposes, we compare the contractual arrangements used to manage the development of new technology by 46 US and 27 Japanese semiconductor equipment firms. We conclude by speculating that the organization of innovation in the Japanese semiconductor equipment industry has accelerated their development of new technology and led to their extraordinarily rapid worldwide market penetration.     

CONTROL POLICIES TO COMBAT THE HEALTH RISKS FROM SMOKING AND PASSIVE SMOKING1

Good information is necessary for markets to allocate resources efficiently. Tobacco is a demerit good; smoking endangers smokers but also exerts externalities on non‐smokers. Public policies, however, foster misinformation, are contradictory and damage public health. Current policies also deny feedback from the tobacco industry and reduce consumer information about tobacco products that could substantially reduce the harmful effects of smoking.     

DATA REVISION AND MARKET RESPONSE: THE CASE OF UNITED STATES TRADE BALANCE ANNOUNCEMENTS†

ABSTRACT In this paper we study economic news, as reflected in the announcements of the United States trade balance by the Commerce department, to illustrate the importance of revised data versus preliminary data to economic agents. A new methodology has been developed here to study how agents in the exchange market respond to these monthly trade balance announcements and consequently, move the dollar's exchange rate. In contrast to previous studies where agent reactions to only preliminary trade figures were analyzed, this method is applied to examine market reactions to the preliminary and revised trade balance figures.