A test of cross section dependence for a linear dynamic panel model with regressors

This paper proposes a new testing procedure for detecting error cross section dependence after estimating a linear dynamic panel data model with regressors using the generalised method of moments (GMM). The test is valid when the cross-sectional dimension of the panel is large relative to the time series dimension. Importantly, our approach allows one to examine whether any error cross section dependence remains after including time dummies (or after transforming the data in terms of deviations from time-specific averages), which will be the case under heterogeneous error cross section dependence. Finite sample simulation-based results suggest that our tests perform well, particularly the version based on the [Blundell, R., Bond, S., 1998. Initial conditions and moment restrictions in dynamic panel data models. Journal of Econometrics 87, 115–143] system GMM estimator. In addition, it is shown that the system GMM estimator, based only on partial instruments consisting of the regressors, can be a reliable alternative to the standard GMM estimators under heterogeneous error cross section dependence. The proposed tests are applied to employment equations using UK firm data and the results show little evidence of heterogeneous error cross section dependence.     

Property and Inflation: The Hedging Characteristics of U.K. Commercial Property, 1967–1994

This paper examines the statistical similarities between U.K. commercial property capital and rental values and the price level. Our aim is to determine whether commercial property is an inflation hedge and, if so, what type of inflation it hedges against. To answer these questions, we use both a multivariate unobserved components model and structural vector autoregressions. We find that commercial property is an inflation hedge but only a weak one. More specifically, we find that property offers some form of partial hedge against changes in the underlying inflation rate but not to either temporary or permanent changes to the price level. We also find that capital values offer a stronger hedge than rental values and that industrial and retail property account for most of this hedging capacity. We find no evidence that property responds differently to high or low inflation but we do find capital and rental values respond more to unexpected inflation than anticipated price changes.     

Segmental new-product diffusion of residential broadband services

Aggregate models of innovation diffusion do not capitalise on valuable consumer adoption dynamics that may be useful to policy makers and market planners. The non-diffusion choice literature shows quite clearly that these dynamics may indeed be very important factors in the diffusion process. The authors present a segmental broadband diffusion model that is estimated from consumer survey data that measure the effect that household income has on its propensity to adopt this technological product. The results suggest that early broadband adopters are mostly made up from wealthy households and only as time progresses do less well off households adopt. The findings presented in this paper will be important to market planners and policy makers requiring a relatively simple technique that forecasts segmental innovation diffusion.     

Why and How Do Employees Break and Bend Confidential Information Protection Rules?

Organizations cannot function effectively if their employees do not follow organizational rules and policies. In this paper, we explore why and how employees in two high‐tech organizations often broke or bent rules designed to protect their employers' confidential information (CI). The CI protection rules sometimes imposed requirements that disrupted employees' work, forcing employees to choose between CI rule compliance and doing their work effectively and efficiently. Employees in these situations often broke the rules or bent them in ways that enabled employees to meet some of the rules' requirements, while also satisfying other expectations that they faced. We discuss implications of our findings for practice and for future organizational scholarship on rule following.     

Continuous-time perpetuities and time reversal of diffusions

We consider the problem of estimating the joint distribution of a continuous-time perpetuity and the underlying factors which govern the cash flow rate, in an ergodic Markovian model. Two approaches are used to obtain the distribution. The first identifies a partial differential equation for the conditional cumulative distribution function of the perpetuity given the initial factor value, which under certain conditions ensures the existence of a density for the perpetuity. The second (and more general) approach, using techniques of time reversal, identifies the joint law as the stationary distribution of an ergodic multidimensional diffusion. This latter approach allows efficient use of Monte Carlo simulation, as the distribution is obtained by sampling a single path of the reversed process.     

A carbon footprint analysis of renewable energy technology adoption in the modal substitution of high-speed rail for short-haul air travel in Australia

This study presents a carbon footprint analysis of renewable energy technology adoption in the modal substitution of high-speed rail for short-haul air travel in Australia. The carbon footprint analysis of renewable energy technology adoption in such modal substitution establishes the efficacy of various renewable energy technologies in assisting CO₂ emissions reduction on the Sydney–Melbourne city pair. Renewable energy technology efficacy, captured in the presented low-carbon pathways for high-speed transportation, provides an indication as to the CO₂ emissions reduction potential of the technologies under consideration and their impact upon the environmental performance of the air and high-speed rail modes. These low-carbon pathways displayed a reduction in annual CO₂ emissions throughout the longitudinal period ranging from moderate to significant. Furthermore, this study examines the cumulative effects of the considered renewable energy technologies upon the annual CO₂ emissions production of the high-speed transportation system. A reduction of 56%–69% in annual life cycle CO₂ emissions demonstrated the powerful mitigation potential of a combined air and high-speed rail transportation system in conjunction with renewable energy technologies adoption and a modal shift of 60%. Given this significant mitigation potential, the hybridization of the air and high-speed rail transportation systems with associated renewable energy technologies is considered. The effect of such hybridization would result in the formation of an integrated low-carbon, high-speed transportation system underpinned by the concept of “sustainable mobility” at the national level.     

The Old Commonwealth and Britain's First Application to Join the EEC, 1961–3

New Zealand, Canada, and Australia reacted in different ways to Britain's decision in 1961 to seek membership of the EEC. We show that the umbrage taken by the members of the old Commonwealth was in inverse proportion to the economic interests at stake. Canada, whose trade with Britain was relatively small, adopted a position of violent opposition to British policy. New Zealand, which was still heavily dependent on the UK as a market for staple commodities, was careful to avoid acting in a manner likely to alienate the British government. Australia, which was in an intermediate position as regards the importance of its trade with Britain, mounted a sturdy defence of its commercial interests, but did not indulge in the histrionics of the Canadians. All three of the old dominions were disappointed with the arrangements for Commonwealth trade towards which the UK and the Six were moving when de Gaulle vetoed British membership in January 1963, but at least New Zealand had obtained some special concessions. Whilst it is unlikely that a less combative attitude by Canada and Australia would have resulted in a better outcome for these countries, a more belligerent approach on the part of New Zealand would have put its economic future in even greater jeopardy.