Estimation of poverty measures with auxiliary information in sample surveys

The analysis of poverty measures has been receiving increased attention in recent years. This paper contributes to the literature by developing percentile ratio estimators based on the pseudo empirical likelihood method. In practice, variances of poverty measures could be not expressible by simple formulae and consequently other techniques should be used in the variance estimation stage. Assuming percentile ratios, resampling techniques are investigated in this paper. A numerical example based on data from the Spanish Household Panel Survey is taken up to illustrate how suggested procedures can perform better than existing ones. The effect of a model-misspecification on the proposed estimators is also evaluated by using simulated populations.     

The measurement of pay discrimination between job assignments

The traditional Becker/Arrow model of taste discrimination in pay depicts majority and minority labour as perfectly substitutable, implying that all workers perform precisely the same job assignment and have the same qualifications. The model is thus only appropriate for determining whether ceteris paribus pay differences between white workers and non-white workers, for example, performing job assignment A are attributable to prejudice (‘within-assignment discrimination’). The model is inappropriate for determining whether ceteris paribus pay differences between white workers in assignment A and non-white workers in assignment B reflect prejudice (‘cross-assignment discrimination’). We extend the traditional model to allow for cross-assignment discrimination and we propose an empirical methodology for its estimation. In so doing we address two broad questions: (1) Do predictions about cross-assignment discrimination vary with the form of the production function?; and (2) How can one estimate such discrimination when there is no common measure of productivity? We address the first question by deriving a measure of cross-assignment discrimination for four different production functions—Generalized Leontief, Quadratic, CES, and Cobb-Douglas. The Generalized Leontief provides the most general results, although closed form solutions are not possible. Closed form solutions are obtainable from the other three functions, but only under restrictive assumptions. There are two main findings. First, most predictions are generally robust across functional forms. Second, cross-assignment discrimination depends upon productivity and labour supply differences between the two worker groups, labour market structure, and the interaction between relative group productivity and prejudice. We address the second question by outlining, for future exploration, a two-stage regression methodology in which a standardised (i.e. common) measure of productivity is estimated separately for each occupation. This measure is then incorporated as a right-hand-side explanatory variable in a second-stage, all-occupation regression designed to estimate cross-assignment discrimination. We discuss the proposed methodology with reference to a valuable and interesting test case: The market for professional sports players.     

Duration dependence testing for speculative bubbles

Prior research has employed a number of methods to test for speculative bubbles in asset prices, including a method based on the concept of duration dependence. This study explores whether duration dependence tests for speculative bubbles are sensitive to specification decisions. Our results question the efficacy of using measures of duration dependence to test for speculative bubbles. In particular, we find that evidence of duration dependence is sensitive to the method of correcting for discrete observation of continuous duration, the use of value-weighted versus equally weighted portfolios, and the use of monthly versus weekly runs of abnormal returns. (JEL C41, G12)     

The causal relation between government revenue and spending: Evidence from Egypt and Jordan

In investigating the causal relation between government revenue and spending, our empirical results support the tax-and-spend hypothesis for Egypt and the fiscal synchronization hypothesis for Jordan. Breaking away from these historical trends is essential for both countries to eliminate the budget deficit and therefore ensure the availability of domestic saving for private investment. To cope with unemployment and poverty, continuing privatization is recommended for both countries to improve productivity and efficiency in the domestic economy. Privatization should lead to higher domestic saving and investment and at the same time eliminate the budget deficit by enhancing revenue and curbing spending. (JEL H62, H63)     

The Dynamics of Self-Esteem and Physical Self: Between Preservation and Adaptation

The aim of this study was to model and characterize the psychologicalprocesses that underlie the dynamics of global self-esteem and physicalself over time. Twice a day for 228 consecutive days, seven participantscompleted a short inventory (PSI-6, Ninot et al., 2001) measuring sixsubjective dimensions: global self-esteem, physical self-worth, physicalcondition, sport competence, physical strength, and attractive body.Each series was modeled by means of ARIMA procedures. The resultsshowed that a simple moving average model provided a satisfactoryaccount for the dynamics of all series. This model suggests that acombination of two opposite processes underlies the dynamics ofself-concept: preservation, which tends to restore the previousvalue after a disturbance, and adaptation, which tends to inflectthe series in the direction of the perturbation.     

Stock market volatility,the news,and monetary policy

The dynamic relationship linking the volatility of equity prices with “the news” and the expected path for monetary policy is investigated. Previous results that link the impact of the news about real activity to changes in current and future interest rates are employed in developing a positive link between changes in volatility and the news. Empirically, our results uncover a positive and statistically significant response of the CBOE volatility index, VIX, to unanticipated changes in employment, but not to inflation. Hence, agents' expectations for the policy response to news have an important influence on the expected volatility of stock prices. (JEL E44, E52)     

A general framework for the analysis of fiscal equalisation systems

This paper shows that, despite the existing diversity of models of fiscal equalisation, there is a common underlying structure that links all of them. To this end, a framework of analysis sufficiently general so as to encompass the main schemes present in the literature is developed. This allows to uncover the common features of these schemes and to identify more readily the origin and nature of their differences. The formal approach is complemented with a numerical simulation of the models considered. The paper also shows the usefulness of the approach for reform policy and suggests two new models.JEL Classification: H2, H7I would like to thank three anonymous referees for their helpful comments and suggestions to a previous draft of this article.     

On the finite sample behavior of testing whether new is better than used of a specified age

Hollander, Park and Proschan (1986) proposed a test of new is better than used of a specified age. It is based on large sample normality of the test statistic. There is, however, no study in the literature on its actual size for small and moderate sample sizes. To shed some lights on this, the results of a Monte Carlo simulation study as well as two real data examples are reported and these indicate that the test can have a quite liberal size, especially for small to moderate sample sizes. In order to improve on this weakness, a modified test is proposed and studied. It is noticed that this modified test seems to over-correct the original test to an extent that it becomes unduly conservative sometimes. Hence we propose another modification that combines the original test and the modified test turns out to have its size quite close to the nominal level and is therefore preferable to both the original and modified tests.     

Empirical Bayes analysis of log-linear models for a generalized finite stationary Markov chain

This article presents the empirical Bayes method for estimation of the transition probabilities of a generalized finite stationary Markov chain whose ith state is a multi-way contingency table. We use a log-linear model to describe the relationship between factors in each state. The prior knowledge about the main effects and interactions will be described by a conjugate prior. Following the Bayesian paradigm, the Bayes and empirical Bayes estimators relative to various loss functions are obtained. These procedures are illustrated by a real example. Finally, asymptotic normality of the empirical Bayes estimators are established.