Understanding the Gender Gap in Financial Literacy: Evidence from Australia

Using micro‐data from the Household, Income and Labour Dynamics in Australia Survey, and the Oaxaca–Blinder decomposition technique, this paper examines the determinants of the gender gap in financial literacy. The analysis suggests that human capital variables, such as age and education, are not important in explaining the gender gap in financial literacy. Labour market variables, such as sector, occupation, industry, union membership and labour market status, are important and explain around 16 per cent of the gap. This finding is dependent on the assumption that these variables are exogenous. There is a large unexplained gap, suggesting that the main determinants are neither human capital nor labour market factors.     

The Compatibility of EU Biofuel Policies with Global Sustainability and the WTO

The EU’s Renewable Energy Directive (2009/28) requires that by 2020, biofuels should account for at least 10 per cent of transport fuel consumption. EU legislation sets out sustainability criteria for biofuels to qualify for this target and procedures for verifying that they are met. Using the AGLINK‐COSIMO model, we investigate the impacts of the biofuel target on global trade flows and land use, both under the current biofuel tariff regime and assuming zero EU tariffs for biofuels. The EU’s 2020 transport fuel target increases the global area of agricultural crops by 0.9 per cent. With zero tariffs, the extra global land requirement is 21 per cent smaller, but a larger share of it falls outside the EU. This outcome sharpens the issue of how the EU’s unilateral sustainability criteria can be implemented given current international trade rules.     

FDI of German Companies During Globalization and Deglobalization

Based on micro-level data of German companies from 1873 to 1927, we identified horizontal and vertical FDI applying a Knowledge-Capital model and analyzed individual FDI decisions. Our KC model revealed that market-driven FDI predominated; however, wage gaps and differences in human capital stimulated cost-driven FDI flows, which accounted for up to 10% of total FDI. On an individual level, large companies with high profitability conducted more FDI. Higher tariffs after WWI enhanced FDI, as companies could circumvent trade barriers—but declining openness reduced FDI. In spite of disintegration after WWI, the propensity to invest increased due to higher market concentration and firm specific investment patterns—albeit industry agglomeration effects were of minor importance.     

Union coverage and non-standard work in Britain

Using representative data from the British Household Panel Surveyfor the period 1991–97, we document the extent of unioncoverage across standard and non-standard workers in Britain.Non-standard employment—defined in terms of contracts,places, times, and hours of work—involves approximately60% of the employed population. Most workers in non-standardemployment are less likely to be union covered than otherwiseidentical workers in standard employment. In particular, womenacross nearly all types of non-standard jobs are significantlyless likely to be covered than women in regular employment.For men, this negative relationship is only found for thoseworking on fixed term contracts or short hours. Gender differencesare therefore large and significant. We cannot detect an expansionof union coverage towards any type of non-standard employmentover our sample period. Finally, we find significant differencesin the relationship between non-standard work and union coveragein the private and public sectors.     

Book Reviews

Hadi Soesastro and Man Pangestu (eds), Technological Challenge in the Asia-Pacific Economy, Sydney: Allen & Unwin, in Association with the Pacific Trade and Development Conference Secretariat at the Australian National University, 1990, pp. xiv + 371. A$34.95.

Jeffrey D. Sachs and Susan M. Collins (eds), Developing Country Debt and Economic Performance, Voi 3: Country Studies - Indonesia, Korea, Philippines, Turkey. Book I: Wing Thye Woo and Anwar Nasution, Indonesian Economic Policies and Their Relation to External Debt Management, Chicago and London: University of Chicago Press for the National Bureau of Economic Research, 1989, pp: x + 821 (Book I, pp. 17-149).

Yoon-Je Cho and Deena Khatkhate, Lessons of Financial Liberalization in Asia: A Comparative Study, Washington DC: The World Bank, 1989, pp. xviii + 228.

Nick Devas (with Brian Binder et al.), Financing Local Government in Indonesia, Monographs in International Studies, Southeast Asia Series, No, 84, Athens, OH: Ohio University Center for International Studies, 1989, pp. xvi + 344. US$14.00.

James Clad, Behind the Myth: Business, Money and Power in Southeast Asia, London: Unwin Hyman, 1989, pp. xii + 275. £14.95.

Lea Jellinek, The Wheel of Fortune: The History of a Poor Community in Jakarta, Asaa Southeast Asia Publications Series 18, 1991, pp. xxviii + 214. A$24.95.

Daniel Benoit, Patrice Levang, Marc Pain and Olivier Sevin, Transmigration et Migrations Spontanees en Indonesie [Transmigration and Spontaneous Migrations in Indonesia]: Propinsi Lampung, Paris and Jakarta: Orstom (Institut Francais de Recherche Scientifique pour le Developpement en Cooperation) and Department of Transmigration, 1989, bilingual text in French and English, pp. 444, large Size (21 × 30 cm), + 20 separate maps (50 × 56 cm) + wall map (100 × 118 Cm).

J. W. Taco Bottema, Hoky Siregar, Sahat M. Pasaribu, Govert Gijsbers and Rofik S. Basuki, Potato in Indonesia: Prospects for Medium Altitude Production, CGPRT No. 21, Bogor: CGPRT, 1989, pp. xxvi + 136.

CGPRT, Soybean Commodify System in Indonrsio. CGPRT No. 3, Bogor. CGPRT, 1988, pp. xvi + 83.

BRIEFLY NOTED: H.W. Arndt, Pembangunan Ekonomi Indonesia: Pandangan Seorang Tetangga [Indonesian Economic Development: As Seen by a Neighbour], Yogyakarta: Gadjah Mada University Press, 1991 [translation edited by Mubyarto], pp. xi + 286.

David Anderson (Ed.), Australia and Indonesia: A Partnership in the Marking, Sydney: Pacific Research Institute, 1991, pp. 63. A$5.00.     

A sticky floors model of promotion, pay, and gender

According to raw data from the British Household Panel Survey, full-time women are more likely than men to be promoted. Controlling for observed and unobserved individual heterogeneity, we find that women are promoted at roughly the same rate as men, but may receive smaller wage increases consequent upon promotion. To help explain these phenomena, we construct a new “sticky floors” model of pay and promotion. In our model, women are just as likely as men to be promoted but find themselves stuck at the bottom of the wage scale for the new grade.     

Between a rock and a hard place: managing diversity in a shareholder society

This study examines whether the appointment of racial/ethnic minorities into top management positions has a different impact on share price than the appointment of Caucasians into equivalent positions. Our dependent variable is the degree of change in share price following the announcement of racial/ethnic minority and Caucasian men into senior management positions. Market reaction to the naming of racial/ethnic minorities into corporate leadership positions is significant and negative, while the market's reaction to the naming of Caucasians is significant and positive. However, the negative market reaction to the appointment of racial/ethnic minorities into top management positions is mitigated in those firms that have explicitly incorporated diversity into their strategic growth plan. Our findings suggest that to successfully introduce diversity into upper management, firm decision makers must first signal the importance of diversity to market actors.     

Formation of buyer-seller trade networks in a quality-differentiated product market

Abstract .  We examine the formation of buyer-seller links when exchange can take place only if such a link exists. Sellers produce products of different qualities, and multiple sellers can form a sellers' association to pool their customers setting uniform prices. Buyers form trade links with individual sellers or sellers' associations. We show which buyer-seller links will form and find the set of links that are stable and show how these links influence prices. We also show that a trade network mismatch may occur where a high-quality good remains unsold even without an economy-wide excess supply of goods.