Heterogeneity in price setting behavior,spatial disparities and sectoral diversity: Evidence from a panel of Italian firms

In this paper, we analyze firms' pricing behavior using a full informative micro dataset that accounts for a large part of Italian firms. In our view, “the black boxes” to examine are the relations between price setting, market structure and spatial disparities. The paper aims to extend the empirical literature in several directions. A first goal of the research is to investigate the link between heterogeneity in price changes and spatial dependence. Besides, we compare the price dynamics among sectors, namely manufacturing vs. service. It is irrefutable that prices stickiness is linked to good market rigidities. Consequently, these issues have extremely important policy implications; for instance, the Monetary Authority considers the macro price indexes in order to determine the right policy to stabilize the economy and to improve social welfare. However, the Central Bank does not distinguish the likely aggregation bias source from the cross sector–region–country heterogeneities.     

Conditional versus unconditional trade concessions for developing countries

Abstract We examine how trade liberalization by a large trading partner affects the ability of a small country’s government to sustain free trade through a reputational mechanism. Unconditional liberalization by the large trading partner has an ambiguous effect on the small country’s dynamic incentives. Liberalization through a reciprocal trade agreement, in which the large country lowers its tariffs conditionally on the small country doing the same, unambiguously dominates unconditional liberalization by the large country as a way of boosting trade reforms and reinforcing policy credibility in the small country. However, if capacity in the import‐competing sector can be reduced only gradually, a conditional, reciprocal agreement may require an asynchronous exchange of concessions, where the large country liberalizes before the small country does.     

Remittances, schooling, and child labor in Mexico

This paper studies the effects of remittances from the U.S. on child labor and school attendance in recipient Mexican households. We identify these effects using the impact of the 2008-2009 U.S. recession on remittance receipts. The methodology employed is a differences-in-differences strategy that compares households that were remittance recipients before the crisis with never-recipient households. To avoid possible selection problems, we instrument for membership in the remittance recipient group. We find that the negative shock on remittance receipts caused a significant increase in child labor and a significant reduction of school attendance.     

Irreversibility and entropy

The genesis and role of entropy in statistical thermodynamics are discussed from first principles, showing in what respect the H-function is unique. Simplifications are introduced in the theory of fluctuations and diverse, often misleading, definitions of entropy are reconciled. The discussion is kept throughout accessible to the non-physicists.     

A NEW DIRECTION IN WORLD BANK URBAN LENDING TO LATIN AMERICAN COUNTRIES*

The urban development loans of the World Bank are acquiring a regional rather than a city-specific orientation in several countries, especially in Latin America. These broader operations often dovetail national trends of decentralization in the political, administrative and fiscal structures. Given the current constraints of the central governments in meeting the growing demands of urbanization through incremental top-down grants, these operations aim at a gradual substitution of unrequited transfers with long-term loans to regional and local governments. The paper reviews the implications of this approach in terms of distribution and efficiency and suggests that it may be more suitable in countries undergoing economic adjustment. The objective is to sustain motivation in fiscal effort and resource mobilization at the city level, and possibly establish a different rationale for external credit supporting local infrastructure and service improvements.     

UPWARD-SLOPING REACTION FUNCTIONS UNDER QUANTITY COMPETITION IN MIXED OLIGOPOLIES*

It is shown that in a mixed duopoly under quantity competition, the public firm's reaction function may be upward-sloping. This is the case with a concave demand function when the public firm attaches to private profits a smaller weight than to its own profits.     

The effects of unification: markets,policy, and cyclical convergence in Italy, 1861–1913

This paper uses time-series evidence on construction movements to examine the convergence of regional business cycles in the decades that followed Italy’s unification. The aggregate series point to cyclical convergence, but a sector-level analysis traces this result to the decline in differentiated “regional-policy” shocks. The regional market cycles diverged, as regions specialized in different sectors of production; market-cycle convergence is observed only within the “industrial triangle,” the regions of which also developed different specializations. This suggests that the balance between growing interdependence and growing differentiation is not general, as the current literature presumes, but specialization-specific.     

Statistics for image sharpening

Sharpening filters increase the depth of digital images by adding a fraction of their gradient. This portion is tuned by a coefficient which is usually selected according to rules of thumb or subjective evaluation. This paper proposes statistical measures for designing such a parameter in a nearly automatic way, avoiding subjective evaluations. The proposed measures are based on the distance between sharpened and equalized images, which serve as an early reference, and test statistics of uniformity of the luminance histogram. More complex measures, based on the trade-off between skewness and kurtosis, and variance and autocovariance of the sharpened image, are also studied. Numerical applications to various kinds of digital images show that the proposed measures provide similar and acceptable solutions.     

A critical review of climate change risk for ski tourism

Ski tourism is a multi-billion dollar international market attracting between 300 and 350 million annual skier visits. With its strong reliance on specific climatic conditions, the ski industry is regarded as the tourism market most directly and immediately affected by climate change. A critical review of the 119 publications that have examined the climate change risk of ski tourism in 27 countries is provided. This growing and increasingly diverse literature has projected decreased reliability of slopes dependent on natural snow, increased snowmaking requirements, shortened and more variable ski seasons, a contraction in the number of operating ski areas, altered competitiveness among and within regional ski markets, and attendant implications for ski tourism employment and values of vacation property real estate values. The extent and timing of these consequences depend on the rate of climate change and the types of adaptive responses by skiers as well as ski tourism destinations and their competitors. The need to understanding differential climate risk grows as investors and financial regulators increasingly require climate risk disclosure at the destination and company scale. Key knowledge gaps to better assist ski tourism destinations to adapt to future climate risk are identified.     

Learning from foreign investment by rival firms: Theory and evidence

We offer an alternative explanation for follow-the-leader behavior in foreign investment decisions based on Bayesian learning by rival firms. We test the implications of the model through a panel count data sample of MNEs that have invested in Central and Eastern Europe over the period 1990–1997. Interacting the measure of rivals' investment in country-industry pairs with uncertainty, we are able to identify the channel of Bayesian learning about revenue postulated by the model as the only one consistently generating the detected follow-the-leader behavior of foreign investments. The empirical findings are robust with respect to different model specifications.