Fixed versus variable supply in the public provision of goods

Using discriminatory price auctions with variable supply, we explore a situation in which a corruptible public employee is in charge of producing and allocating a finite number of goods among consumers with uniformly distributed valuations. The negative effects of corruption are lower when the employee‘s task is to “provide at least q₀ goods” than when the employee is required to “provide exactly q₀ goods”.     

Under the influence of a blogger: The role of information‐seeking goals and issue involvement

Bloggers in the postmodern era can influence the behaviour of consumers and alter their perceptions. The current study looks at the blogger influence phenomenon from a different theoretical perspective than existing literature did. By combining information behaviour and communication theory, it proposes a new conceptual framework by relying on the characteristics of the blogger, the blog content, motivation, and goals of information seeker. In this model, information seekers’ objectives and issue the involvement are important drivers of blog selection and determinants of the blog's influence. The framework was empirically tested in a sample of American users of beauty blogs. The results provide a confirmation of the postulated relationships. Three types of blog visits are identified and their effects and their attributes that make a blog influential are examined.     

Do the Rich Stay Unemployed Longer? An Empirical Study for the UK

This paper investigates the impact of individual asset holdings on the probability of leaving unemployment. According to the theory, higher levels of financial wealth will result in higher reservation wages and longer unemployment durations. I estimate the impact of financial assets on the hazard rate, using data for Great Britain. The empirical findings indicate that individual asset holdings affect significantly the escape rate out of unemployment. In particular, negative (positive) levels of wealth increase (reduce) the hazard of leaving unemployment. The size of the impact is, however, rather small. Increasing by 100% the level of wealth of a representative individual, with net wealth and other individual characteristics equal to the sample mean, increases the duration of the unemployment spell by half a week.     

Does Ethnic Discrimination Vary Across Minority Groups? Evidence from a Field Experiment*

We conduct a large‐scale field experiment to measure labour market discrimination in Australia, one quarter of whose population was born overseas. To denote ethnicity, we use distinctively Anglo‐Saxon, Indigenous, Italian, Chinese and Middle Eastern names. We compare multiple ethnic groups, rather than a single minority as in most other studies. In all cases we applied for entry‐level jobs and submitted a CV indicating that the candidate attended high school in Australia. We find significant differences in callback rates: ethnic minority candidates would need to apply for more jobs in order to receive the same number of interviews. These differences vary systematically across ethnic groups.     

Estimating the intergenerational persistence of lifetime earnings with life course matching: Evidence from the PSID

Why do estimates of the intergenerational persistence in earnings vary so much for the United States? Recent research suggests that lifecycle bias may be a major factor [Grawe, N., Lifecycle bias in estimates of intergenerational earnings persistence. Labour Economics 2006, 13:551–570; Haider, S., and Solon, G., Life-cycle variation in the association between current and lifetime earnings. American Economic Review 2006, 96(4):1308–1320.]. In this paper we estimate the intergenerational correlation in lifetime earnings by using sons' and fathers' earnings at similar ages in order to account for lifecycle bias. Our estimate based on earnings measured at 35–44 for both fathers and sons is similar to that for the age range 45–54.     

Wages in a growing Russia

The robust Russian economic recovery after the 1998 financial crisis raised the economic standing of the population, especially for lowly paid workers, most of whom are women. In this paper I use the Russian Longitudinal Monitoring Survey from 1996 through 2002 to ask whether this helped to reduce the gender wage gap. I first focus on those whose wages are paid in full. Next, I ask about the gender composition of wage arrears as the overall extent of wage arrears dropped from 60 to 20 per cent after the 1998 crisis. I show that a temporary widening of the overall gender wage gap in 2000 is due to low‐wage women becoming more likely to receive their wages in full than low‐wage men. Except for this effect, the male–female pay difference in Russia exhibits a stable pattern.     

Impact of China's WTO Accession on East Asia

The industrialized and newly industrializing economies (NIEs) in East Asia will benefit from China's WTO accession, and the developing economies in the region may incur small welfare losses. China will increase its demand for high-end manufacturing products from Japan and the NIEs and farm products, natural resources, and manufactured goods from developing East Asia. New foreign investment may flow into these expanding sectors. The overall impact on foreign investment is likely to be positive in the NIEs but negative in developing East Asia. The NIEs may face heightened competition in global markets as China's comparative advantage shifts into high-end products. (JEL F11 , F13 , F15 )     

Deposit guarantee evaluation and incentives analysis in a mutual guarantee system

This paper analyzes how the deposit guarantee value affects the risk incentives in a mutual guarantee system. We liken the guarantee’s value to that of a European-style contingent claims portfolio. The main feature emerging from our model is that a mutual guarantee system would give banks an adverse incentive to increase riskiness. To mitigate this incentive, we introduce a regulatory provision modelled using a path-dependent contingent claim. By comparing the mutual guarantee system with a non-mutual one, we show that the former is less expensive, but implies higher adverse incentives for the banks, especially for undercapitalized institutions.