Exploring the impact of economic integration agreements through extreme bounds analysis

This article provides an empirical strategy guided by the data to estimate the effects of Economic Integration Agreements (EIAs) on trade flows and their transitional dynamics. The strategy uses Extreme Bounds Analysis (EBA) to guide the choice of lags and leads in the effects without researchers' discretion involved. We show that arbitrarily selected year intervals and starting year can result in non-robust estimates of transitional dynamics of the effects of EIAs on trade flows. The empirical strategy follows two steps: EBA first sifts lags and leads of EIAs robustly related to trade flows from candidates, then these are included in the gravity equation to estimate the effects of EIAs on trade. We find that various lags and leads are robustly and positively related to trade flows, and the lag and lead structure depends on the level of integration. Our results show that EIAs have a long-term effect of 63% on trade flows. Under the richer lag and lead structure, deep-integration agreements beyond the level of free trade agreements have a much higher impact on trade flows than free trade agreements do (132% vs 31%). The estimates of effects of EIAs obtained from EBA-based estimation have a smaller contemporaneous effect and larger phased-in effects compared to previous studies relying on the subjective choices of year intervals while similar results are observed with the decomposed EIAs.     

Intrahousehold moral hazard frictions and household poverty traps in rural India

We empirically study the role of assets held by women in the creation of household wealth using data from rural India. We design a streamlined model of intrahousehold project funding where moral hazard frictions between spouses and women's asset control are the main ingredients. As predicted by the model, the data show that household asset accumulation depends on women's asset control in a non-monotonic way. Results indicate no presence of multiple equilibrium poverty traps, but do show that exogenous negative shocks will trigger assets aggregation within households where both spouses are present. This resilience mechanism is, however, not found in female headed household as these households have a monotonic relationship between women's wealth control and asset creation. We thus argue that policies to support women's empowerment need to distinguish women based on their individual wealth levels and headship status to enhance household well-being in remote Indian communities.     

Predicting long-run risk factors of stock returns: Evidence from Australia

This study utilises the stock market data provided by the Australian Equity Database to analyse the long-run relationship between Australian stock returns and key macroeconomic variables over the period 1926–2017. To measure the diverse risk factors in the stock market, we examine the possible determinants in four main categories: real, financial, domestic and international. Our results reveal that historical stock returns are strongly connected to financial and international factors as compared to real and domestic factors. Both the 1973–1974 OPEC Oil Price Crisis and 2007–2008 Global Financial Crisis had dampening effects on stock returns. There is a positive association between the US and Australian stock markets in the long-run. These findings on stock market dynamics and their linkages with domestic and international macroeconomic policy changes in the long-run have important implications for traders and practitioners.     

Estimation of Poverty Transition Matrices with Noisy Data

This paper investigates measurement error biases in estimated poverty transition matrices. We compare transition matrices based on survey expenditure data to transition matrices based on measurement‐error‐free simulated expenditure. The simulation model uses estimates that correct for measurement error in expenditure. We find that time‐varying measurement error in expenditure data magnifies economic mobility. Roughly 45% of households initially in poverty at time t ? 1 are found to be out of poverty at time t using data from the Korean Labor and Income Panel Study. When measurement error is removed, this drops to between 26 and 31% of households initially in poverty. Copyright © 2016 John Wiley & Sons, Ltd.     

Enterprise systems’ life cycle in pursuit of resilient smart factory for emerging aircraft industry: a synthesis of Critical Success Factors’(CSFs), theory,knowledge gaps,and implications

The research aims to investigate business value critical success factors (CSFs) of enterprise systems (ES) through their life cycle in pursuit of resilient smart factory for emerging aircraft industry. This article provides an extensive literature analysis of past 22 years based on conscientious criteria of authors: (i) who have published strategic content relevant to CSFs, (ii) received more than 300 citations and (iii) concurrently published two or more papers relevant to ES CSFs. The most cited strategic CSFs were termed as classical CSFs. The 22 CSFs were identified, validated and synthesised for better understanding of success across life cycle by aircraft industry experts. The top 10 empirically verified CSFs have numerous differences with past generic classical CSFs. This article canvases real insights of two distinct views: process and variance approaches of the ES CSFs. The process approach, which is a neglected research area, facilitates the researchers for identification of ES life cycle process coupled with a view of resource deployment when it is needed the most. While the variance approach facilitates practitioners and researchers in finding out which resource (CSF) is relatively more important. The significant findings for ES life cycle can help the practitioners and researchers to make rational decisions throughout the ES life cycle.     

Long-term impact of investments in early schooling — Empirical evidence from rural Ethiopia

We examine the cumulative impact of early schooling investments on later schooling outcomes using enrollment status and relative grade attainment as short-run and long-run measures of schooling. Using a child-level longitudinal data set from rural Ethiopia, we estimate a dynamic conditional schooling demand function where the coefficient estimate on the lagged dependent variable captures the impact of all previous period schooling inputs and resources. We find that a child who is enrolled in the prior period is 33 percentage points more likely to be enrolled currently. These lagged effects are stronger for girls and for children from higher income households.     

Effective tax and subsidy rates on human capital in Canada

Abstract. Effective tax and subsidy rates (ETRs and ESRs) on human capital investment via post‐secondary education are estimated for Canada in the years 2000 and 2006. The flattening of the federal personal income tax structure in 2001 substantially reduced the tax disincentive for investment in human capital. Effective subsidy rates also declined as public spending did not keep pace with rising tuition fees. The change on the tax side was strong enough to dominate the subsidy reduction according to our main results, but disaggregation shows that this result did not hold in all cases. Results are shown for College, Master's, and PhD programs, in addition to Bachelor's degrees. They are also broken down by gender, and are shown for the 25th and 75th percentiles as well as the median. Provincial detail and 1997 results are provided in the case of Bachelor's graduates.