The potential of African trade integration – Panel data evidence for the COMESA-EAC-SADC Tripartite

ABSTRACT

The COMESA-EAC-SADC Tripartite FTA, formed in 2011, is supposed to be a milestone towards Africa's continental trade integration. This study analyzes the impact of regional integration among the Tripartite countries on their bilateral imports before that date to evaluate the latest integration efforts. We estimate an extended gravity model on a large panel of 51 African countries using yearly observations from 1995 to 2010. We proxy existing formal trade barriers by sample average tariff data on imports from the world as well as indicator variables for the membership in regional FTAs. We consider different estimation techniques and discuss distinct sets of fixed effects. The PPML regression results indicate that remaining tariffs are significantly negatively correlated with imports throughout the preferred multiplicative models. An FTA status does not show a clear-cut import enhancing effect. In the specifications that control for country-year effects, the EAC coefficient is positively correlated with imports, and the COMESA and SADC FTA membership show a positive relation to imports within some reduced-sample robustness checks.     

Farmers' Health Insurance and Access to Health Care

We estimate farmers' health care consumption given their insurance status, explicitly taking into account the possible endogeneity of insurance. Data come from the 1996–2001 waves of the Medical Expenditure Panel Survey conducted by the Agency for Healthcare Research and Quality. Results show that farmers have problems accessing affordable health insurance coverage, and these access problems lead to an overall reduction in the utilization of health care services by uninsured farmers. After controlling for selection, we observe quantitatively large and statistically significant direct effects of uninsurance on the utilization of health care services.     

Subsidizing Technological Innovations in the Presence of R&D Spillovers

Abstract. We analyze a situation where a principal wants to induce two firms to produce an output, for example electricity from renewable energy sources. Firms can undertake non-contractible investments to reduce production cost of the output. Part of these investments spills over and also reduces production cost of the other firm. Comparing a general price subsidy and an innovation tournament, we find that the principal's expected cost of implementing a given expected output is always higher under the tournament, even though this scheme may lead to more innovation.     

The effect of double coverage on health care utilization of children

Double coverage refers to a situation in which a person is covered by more than one health plan. In a family in which the husband and wife are both offered employer-provided insurances, it is possible for one or more family members to be double covered. This article is the first to examine double coverage of children and quantify the effects of double coverage on health care utilization for any population. Results show that double coverage does not affect the frequency at which children consume medical services, but rather double coverage leads children to consume more expensive forms of health care.     

WAGE FLOORS,IMPERFECT PERFORMANCE MEASURES,AND OPTIMAL JOB DESIGN

We analyze the effects of wage floors on optimal job design in a moral‐hazard model with asymmetric tasks and imperfect aggregate performance measurement. Due to cost advantages of specialization, assigning the tasks to different agents is efficient. A sufficiently high wage floor, however, induces the principal to dismiss one agent or to even exclude tasks from the production process. Imperfect performance measurement always lowers profit under multitasking, but may increase profit under specialization. We further show that variations in the wage floor and the agents' reservation utility have significantly different effects on welfare and optimal job design.     

MOVIES,MASS CONSUMERS,AND CRITICS: ECONOMICS AND POLITICS OF A TWO‐SIDED MARKET

Most analyses of the film market treat it as a single entity where producers make films based on average consumer interest while critics serve as forecasters or signalers of film quality to these consumers. We describe the film market as two‐sided—a mass market (average consumer) side and a high quality/artistic (cineaste) side—that each influence film maker production decisions and critical reviews as critics balance the preferences of mass market consumers and their own more artistic inclination. Using 1,824 films released during 2000–2014, we examine determinants of box office revenues and critical reviews, while addressing the overlap between them. Our results indicate that consumers and critics respond differently not only to film rating but also to film budgets, story sources, genre, and political content. We then use the dichotomy between average and high quality, artistic film consumers as a basis for understanding the normative views of the film markets relative to other two‐sided markets as well as the political economy of film regulation. (JEL C30, D10, Z11)