Education public financing and economic growth: an endogenous growth model versus evidence

Using an Endogenous Growth Model with physical and human capital and unemployment (Mauro and Carmeci in J Macroecon 25:123–137, 2003), we study the effects of subsidies to education in economic growth. According to the model, we conclude that government subsidies to education only enhance economic growth conditional on unemployment and that this relationship is negatively influenced by unemployment. We provide evidence from a broad panel data of countries that confirms the importance of unemployment in the relationship between subsidies to education and economic growth but dismiss its importance as a direct determinant of economic growth.      

Religion in macroeconomics: a quantitative analysis of Weber’s thesis

Max Weber in 1905 claimed that Protestantism, and more specifically Calvinism, facilitated the rise of capitalism. This paper assesses the quantitative plausibility of his hypothesis by introducing religious beliefs into a dynamic general equilibrium model of development and growth. Through counterfactual exercises, the paper investigates whether differences between Catholics and Protestants most closely identified with the Protestant Work Ethic can account for long delays in the start of Industrialization observed between various countries and regions. The main finding is that these differences may possibly explain why Northern Europe developed before Southern Europe, but they cannot explain why Europe developed before Latin America.

Many of the tenets of Calvinism have had profound social implications–in particular, that thrift, industry, and hard work are forms of moral virtue and that business success is an evidence of God’s grace. Because these views helped to create a climate favorable to commerce, Calvinism played a role in the overthrow of feudalism and the establishment of capitalism. Microsoft Encarta

We thank Doug Gollin, Larry Neal, Richard Layton, as well as seminar participants at University of Wisconsin Madison and Vanderbilt University for their comments.     

Exponential discounting bias

We address intertemporal utility maximization under a general discount function that nests the exponential discounting and the quasi-hyperbolic discounting cases as particular specifications. Under the suggested framework, the representative agent adopts, at some initial date, an optimal behavior that shapes her consumption trajectory over time. This agent desires to take a constant discount rate to approach the optimization problem, but bounded rationality, under the form of a present bias, deviates the individual from the intended goal. As a result, decreasing impatience will end up dominating the agent’s behavior. The individual will not be aware of her own time inconsistency and, therefore, she will not revise her plans as time elapses, what makes the problem relatively simple to address from a computational point of view. The general discounting framework is used to approach a standard optimal growth model in discrete time. Transitional dynamics and stability properties of the corresponding dynamic setup are studied. An extension of the standard utility maximization model to the case of habit persistence is also considered.     

Interactions between electricity generation sources and economic activity in two Nord Pool systems. Evidence from Estonia and Sweden

The interactions between electricity sources and industrial production in Estonia and Sweden are analysed based on monthly data. The availability of data defines the time spans from January 2010 to September 2015 for Sweden and from April 2010 to December 2014 for Estonia. These countries are particularly interesting to study because of their dissimilar generation mix. Estonia’s generation mix is based on oil shale, while Sweden’s is based on nuclear plants and hydroelectricity. In short, both countries’ energy mixes are based on endogenous natural resources. The ARDL model was applied, allowing the long-run and short-run effects to be captured. The results prove that economic growth is sustained by natural endogenous resources. Estonia should continue to improve the usage of renewable energies, using fossil sources in support, in order to reduce emissions and to meet international environmental commitments. Sweden should promote the efficient usage of various renewable sources.     

Online users' attitudes toward fake news: Implications for brand management

This study examines brands' vulnerability to fake news. The rapid spread of online misinformation poses challenges to brand managers, whose brands are cocreated online, sometimes to the detriment of the brand. There is a need to identify the information sources that are likely to be trustworthy and to promote positive consumer attitudes toward brands. The data for this study were taken from a Flash Eurobarometer of 26,576 respondents across 28 European countries. Cluster analysis and partial least squares structural equation modeling were used to analyze the data and unveil users' attitudes toward fake news. The findings show that users' attitudes toward fake news differ among European countries. Younger and tech-savvy users are more likely to recognize fake news and are consequently able to evaluate digital information sources without relying on policy interventions to limit the impact of fake news. Brand managers can use the findings of this study to better understand different kinds of users' susceptibility to fake news and reshape their social media branding strategies accordingly. It is hoped that this paper will encourage further research on brand management in relation to fake news and promote the widespread adoption of best practices in social media communication.     

Firm-specific Human Capital Accumulation: Evidence from Brazil*

We introduce firm-specific returns to experience and tenure into a standard two-way fixed effects model, show that they are separately identified under the standard exogenous mobility assumption and with sufficient between firm mobility, and provide a new evidence on heterogeneity of returns to experience and tenure across firms using the administrative data from Brazil over the years 1999–2014. We document that (1) returns to tenure are not strongly related to firm wage premia, (2) returns to experience are strongly negatively correlated with firm wage premia, (3) the relationship between firm wage premium and return to experience is stronger for ‘blue collar’ firms.     

Improving time series forecasting: An approach combining bootstrap aggregation,clusters and exponential smoothing

Some recent papers have demonstrated that combining bagging (bootstrap aggregating) with exponential smoothing methods can produce highly accurate forecasts and improve the forecast accuracy relative to traditional methods. We therefore propose a new approach that combines the bagging, exponential smoothing and clustering methods. The existing methods use bagging to generate and aggregate groups of forecasts in order to reduce the variance. However, none of them consider the effect of covariance among the group of forecasts, even though it could have a dramatic impact on the variance of the group, and therefore on the forecast accuracy. The proposed approach, referred to here as Bagged.Cluster.ETS, aims to reduce the covariance effect by using partitioning around medoids (PAM) to produce clusters of similar forecasts, then selecting several forecasts from each cluster to create a group with a reduced variance. This approach was tested on various different time series sets from the M3 and CIF 2016 competitions. The empirical results have shown a substantial reduction in the forecast error, considering sMAPE and MASE.