Does income inequality increase marginal propensity to consume?

This article empirically investigates the effects of income inequality on the marginal propensity to consume (MPC), using panel data of 22 OECD countries over the period 1994–2015. We find that MPC increases dramatically as income inequality increases. In subsample analyses, the MPC of a high inequality group is more than twice that of a low inequality group.     

Compulsory schooling laws and school crime

Extensive literature demonstrates that compulsory schooling laws improve educational attainment, well-being, civic involvement, and labour market outcomes. However, at-risk youth incapacitated to schools may impact the learning environment and school safety. The purpose of this article is to study whether raising the minimum dropout age (MDA) requirement above 16 increases crime committed within US public high schools. A difference-in-difference estimation exploits changes in state-level MDA laws over time and indicates that schools in states that raise their MDA requirement to 18 incur more overall crime relative to schools in states that do not, while no effect on overall crime is identified when the MDA requirement is raised to 17. Furthermore, these effects persist for 4 years after passage and more intensely in metropolitan areas. Coupling this research with existing literature suggests that when the MDA requirement is raised to 18, only a small portion of the observed reduction in juvenile crime is displaced to schools. Analysis by category of crime reveals schools incur more physical attacks, no change in illegal drug and property crimes, and fewer violent crimes in states that raise their MDA requirement to 18, while illegal drug crimes increase in states that raise their MDA requirement to 17.     

Nonlinear effects of government debt on private consumption: Evidence from OECD countries

This paper investigates nonlinear effects of government debt on private consumption. The estimated consumption function shows smooth regime switching depending on the debt-to-GDP ratio, and a higher level of government debt crowds out private consumption to a greater extent.     

Foreign Debt and Domestic Savings in Developing Countries

ABSTRACT

This paper addresses the question of potential causality between foreign debt and domestic savings within the context of developing countries. The literature provides evidence insofar as foreign debt and development is concerned, but little attention has been given so far to internal potential for capital formation. We provide a theoretical framework and test its relevance by using 1975–2004 data for two groups of countries: sub-Saharan Africa and Latin America with the Caribbean. With the use of instrumental variables we find that foreign debt impacts negatively on domestic savings, especially in the long run. The results are not susceptible to the choice of countries or outliers. However, the relationship between foreign debt and savings seems to depend on debt accumulation gaining significance only after surpassing a country's specific threshold.

RESUMEN. Este estudio aborda el tema de la causalidad potencial que existe entre la deuda externa y el ahorro interno en el ámbito de los países en desarrollo. La literatura existente contiene pruebas sobre la deuda externa y el desarrollo pero, hasta el momento, ha dedicado poca atención a todo lo concerniente al potencial doméstico para la formación de capital (capitalización). Hemos trazado un marco teórico y puesto a prueba su relevancia usando datos del período 1975–2004 para dos grupos de países: África subsahariana y Latinoamérica incluyendo El Caribe. Los instrumentos variables utilizados nos permitieron encontrar el impacto negativo que la deuda externa ejerce sobre el ahorro interno, especialmente a largo plazo. Estos resultados no son susceptibles a la selección de países específicos o aislados. No obstante, la relación entre la deuda externa y el ahorro parece depender de la acumulación de la deuda, adquiriendo más significado solo después de pasar el umbral específico de un país.

RESUMO. Este estudo aborda a questão da causalidade possível entre o débito estrangeiro e a poupança interna no contexto dos países em desenvolvimento. A literatura apresenta evidências sobre débito externo e desenvolvimento, mas há pouca informação em relação ao potencial interno para a formação de capital. Mostramos uma estrutura teórica e testamos a sua relevância, utilizando dados de 1975 até 2004 para dois grupos de países: a África Subsaariana e a América Latina com o Caribe. Com a ajuda das variáveis instrumentais, descobrimos um impacto negativo do débito estrangeiro sobre a poupança interna, especialmente a longo prazo. Os resultados não são suscetíveis à escolha de países ou de dados atípicos (outliers). A relação entre débito externo e poupança, entretanto, parece depender do acúmulo do débito, tornando-se importante, apenas no caso de ultrapassar um limiar específico do país.     

micro-Business Community Responsibility in Australia: Approaches, Motivations and Barriers

Micro and small businesses contribute the majority of business activity in the most developed economies. They are typically embedded in local communities and therefore well placed to influence community wellbeing. While there has been considerable theoretical and empirical analysis of corporate citizenship and corporate social responsibility (CSR), the nature of micro-business community responsibility (mBCR) remains relatively under-explored. This article presents findings from an exploratory study of mBCR that examined the approaches, motivations and barriers of this phenomenon. Analysis of data from 36 semi-structured interviews with micro-business owner-operators in the Australian city of Brisbane revealed three mBCR approaches, suggesting an observable mBCR typology. Each mBCR type was at least partly driven by enlightened self-interest (ESI). In addition to a pure ESI approach, findings revealed ESI combined with philanthropic approaches and ESI combined with social entrepreneurial approaches. The combination of doing business and doing good found amongst participants in this study suggests that many micro-business owner-operators are supporters of their local communities and, therefore, driven by more than profit. This study provides a fine-grained understanding of micro-business involvement in community wellbeing through a lens of responsible business behaviour.     

Role and impact of the environment on entrepreneurial learning

Abstract

This article is presenting an overview of the literature devoted to entrepreneurial learning and, more specifically, those research bringing environmental elements into the study of the entrepreneurial learning process. Then, it shows how each of the four Special Issue selected research papers contribute to enhancing our knowledge of the complexity of the learning process vis-à-vis entrepreneurial processes placed in context. By doing this, it makes an attempt to explain the specific context behind each contribution as well as presenting the wider context. Finally, the article is suggesting a set of key challenges and research pathways that might be explored in the future.     

Barriers to innovation through public procurement: A supplier perspective

Public procurement is increasingly viewed as having important potential to drive innovation. Despite this interest, numerous barriers prevent the public sector from acting as an intelligent and informed customer. This paper seeks to understand how barriers related to processes, competences, procedures and relationships in public procurement influence suppliers? ability to innovate and to reap the benefits of innovation. We address this by exploiting a dedicated survey of public sector suppliers in the UK, using a probit model to investigate the influence of structural, market and innovation determinants on suppliers? perception of these barriers.     

Parent country nationals or local nationals for executive positions in foreign affiliates: An empirical study of Japanese affiliates in Korea

This study examines how the host country experience of Japanese multinational corporations (MNCs) affects their staffing policies for executive manager positions at foreign affiliates. Hypotheses on executive staffing policies for foreign affiliates are tested using survey data collected from 103 Japanese affiliates in Korea. Findings show that the level of global integration and the degree of centralization of decision-making positively affect an assignment of parent country nationals as executive managers of foreign affiliates. We further find that foreign affiliates’ experience in a host country moderates the effects of both global integration and centralization on staffing decisions for the affiliates.