Price Stickiness and Sectoral Inflation Persistence: Additional Evidence

In this paper, using U.S. as well as French sectoral data and indicators of price rigidity, we reexamine the (lack of) relation between price stickiness and inflation persistence. This has recently been put forward by Bils and Klenow (2004) as evidence against time‐dependent price setting models. We obtain that, when filtering out sector‐specific shocks along the lines of Boivin, Giannoni, and Mihov (2009), and allowing for an alternative assumption on the marginal cost process, the case against the time‐dependent Calvo model is substantially weakened.     

IPO Pricing and Share Allocation: The Importance of Being Ignorant

Since an underwriter sets an IPO's offer price without knowing its market value, investors can acquire information about its value and avoid overpriced deals (“lemon‐dodge”). To mitigate this well‐known risk, the bank enters into a repeat game with a coalition of investors who do not lemon‐dodge in exchange for on‐average underpriced shares. We (i) derive and test a quantitative IPO pricing rule (showing that tech IPOs were not excessively underpriced during the boom of the 1990s); and (ii) analyzing a unique multibank data set, find strong support for the conjecture that a bank preferentially allocates shares to its coalition.     

Business Cycles,Economic Crises,and the Poor

This paper examines whether output contractions associated with downturns and crises have an asymmetric effect on poverty. Several potential sources of asymmetry are identified first. A vector auto-regression model (involving the output gap, unemployment, real wages, and the poverty rate) is then used to test whether the initial cyclical position of the economy, and the magnitude of the initial drop in the output gap in a downturn, matter in assessing the impact of output shocks on poverty. Empirical results for Brazil indicate that poverty shows less sensitivity to output shocks when the economy is initially in a downturn.     

IS CORPORATE R&D INVESTMENT IN HIGH‐TECH SECTORS MORE EFFECTIVE?

This paper discusses the link between R&D and productivity across the European industrial and service sectors. The empirical analysis is based on both the European sectoral OECD data and on a unique micro‐longitudinal database consisting of 532 top European R&D investors. The main conclusions are as follows. First, the R&D stock has a significant positive impact on labor productivity; this general result is largely consistent with previous literature in terms of the sign, the significance, and the magnitude of the estimated coefficients. More interestingly, both at sectoral and firm levels the R&D coefficient increases monotonically (both in significance and magnitude) when we move from the low‐tech to the medium‐ and high‐tech sectors. This outcome means that corporate R&D investment is more effective in the high‐tech sectors and this may need to be taken into account when designing policy instruments (subsidies, fiscal incentives, etc.) in support of private R&D. However, R&D investment is not the sole source of productivity gains; technological change embodied in gross investment is of comparable importance on aggregate and is the main determinant of productivity increase in the low‐tech sectors. Hence, an economic policy aiming to increase productivity in the low‐tech sectors should support overall capital formation.     

The Marshall Plan and the Spanish postwar economy: a welfare loss analysis1

This article uses historical fact as a natural experiment to measure a country's welfare loss from shifting from an allowed to a restricted trade situation, based on international trade theory. A welfare loss of 8 per cent of GDP is found. The evolution of domestic import and export prices in Spain in 1940–58 fits international trade theory assumptions. The main years of autarky are not those commonly considered, but 1947–55, marked by the exclusion of Spain from the Marshall Plan and the Madrid Treaty between Franco's regime and the US. The upper‐bound welfare loss for 1947–55 is 26 per cent of GDP.     

Adolescent shopping behaviour: Different assimilation and individuation needs in France and the United States

What causes adolescents to prefer to shop with friends rather than family? A study of 570 adolescents assesses the combined effects of the individuation and assimilation needs that underlie adolescent shopping behaviours across two cultures (France and the United States). Whereas assimilation is more important than individuation to explain the frequency of shopping with friends in France, individuation is more important in the United States. Insights into the motives that drive adolescents to shop with friends suggest some cues that retailers might use to attract this growing segment, more effectively and across cultures.     

A Kinked-Demand Theory of Price Rigidity

I provide a microfounded theory for one of the oldest, but so far informal, explanations of price rigidity: the kinked-demand curve theory. Kinked-demand curves arise when some customers observe at no cost only the price at the store they are at. At the microlevel, the kinked-demand theory predicts that prices should be more likely to change if they have recently changed, and more flexible in markets where customers can more easily compare prices. At the macrolevel, it captures a part of the inflation/output trade-off that is not shifted by inflation expectations and therefore persists in the long run.     

Empoderamiento colectivo de los trabajadores en las redes de producción globalizadas: análisis retrospectivo de una oportunidad fallida

En este artículo se examina la capacidad de las ONG para empoderar colectivamente a los trabajadores en las redes de producción globalizadas, ejerciendo presión sobre las multinacionales para poner en marcha programas de elección de comités de empresa en las fábricas. La investigación empírica realizada entre 2012 y 2019 en el sur de China muestra que se logró movilizar a los trabajadores y potenciar su capacidad de acción, pero la continuidad de los programas se vio frustrada por la desigualdad estructural del sistema productivo, la falta de protección institucional de los representantes electos y el endurecimiento del régimen.     

Labor Mobility: Implications for Asset Pricing

Labor mobility is the flexibility of workers to walk away from an industry in response to better opportunities. I develop a model in which labor flows make bad times worse for shareholders who are left with capital that is less productive. The model shows that firms face greater operating leverage by providing flexibility to mobile workers. I construct an empirical measure of labor mobility consistent with the model and document an economically significant cross‐sectional relation between mobility, operating leverage, and stock returns. I find that firms in mobile industries earn returns over 5% higher than those in less mobile industries.