Tourist modernisation and social legitimation in Spain

Spain's modernisation has been based, to a large extent, on the so‐called ‘residential tourism’. Its two‐fold nature—as a production model and a type of lifestyle migration—has complex repercussions. The aim of this paper is to delve, with a qualitative approach, into the key factors that explain the current social legitimation of this process by the Spanish society. The research suggests that the process is legitimated by its definition as an essentially tourism phenomenon. The label ‘tourism’ acts as some sort of ‘funnel’ that would not allow to go through it the problems associated with lifestyle migration or urbanisation. Copyright © 2010 John Wiley & Sons, Ltd.     

Coalition Stability in Public Goods Provision: Testing an Optimal Allocation Rule

We test the canonical model of international environmental agreements (IEAs) in a laboratory setting with asymmetric agents. IEA participation represents coalition formation and public good provision where there are gains to cooperation, but an incentive to free-ride. We test four competing methods of dividing the coalition’s worth: a recently proposed optimal rule which accounts for subjects’ payoffs as a single free-rider, the Shapley value, the Nash bargaining solution, and an equal split. Each treatment generates the theoretically predicted coalition size more often than not. The shares of the potential gains to cooperation achieved by each rule are: 51, 36, 40 and 13%, respectively. These results highlight the importance of using an optimal rule to improve IEAs, and more broadly for voluntary public good provision.     

Missing links in key sector analysis

In general terms, key sectors analysis aims at identifying and quantifying the economic impact of a sector in a given economy. For a sector, we mean here either an industry or a region, or even a cluster of them. Quite a few measures and methodologies of varied complexity have been proposed in the literature, from multiplier sums to extraction methods, but not without debate about their properties and information content. All of them, to our knowledge, focus exclusively on the interdependence effects that result from an input–output structure of the economy. By so doing the approach misses critical links beyond the interindustry ones. A productive sector's role is that of producing but also that of generating and distributing income among primary factors and households as a result of production. Thus, when measuring a sector's role, the income generating process should not be omitted if we want to elucidate the sector's true economic impact. A simple way to make the missing income links explicit is to use the SAM (Social Accounting Matrix) facility. Extending an extraction methodology to the SAM we compare lost output with and without the missing links. We observe that substantial differences in sectoral lost gross output arise but, even more important, we capture the implied shifting in the rank ordering of sectors.     

Is the tax administration just a money machine? Empirical evidence on redistributive politics

Personal income tax represents the main source of tax revenue in any developed country. In this paper, we analyse how efficiently this tax is administered in the Spanish case. While we find that the managerial (or net) efficiency of the tax administration was very high for the period 1993–2002 (95.9%), our main aim here is to identify the determinants of this. Interestingly, political factors are found to play a role. Specifically, the fear of losing a parliamentary seat in a region forces the tax authorities to reduce their efficiency in ensuring tax compliance in that region (“swing voter model”). Additionally, in those electoral districts where the central government obtains higher electoral support the efforts to collect taxes diminish (“core voter model”). However, the former political effect tends to disappear when the central government holds a sufficient majority in the central parliament. Thus, we find empirical evidence on redistributive politics in tax administration.     

Relative price volatility under Sudden Stops: The relevance of balance sheet effects

Sudden Stops are associated with increased volatility in relative prices. We introduce a model based on information acquisition to rationalize this increased volatility. An empirical analysis of the conditional variance of the wholesale price to consumer price ratio using panel ARCH techniques confirms the relevance of Sudden Stops and potential balance sheet effects as key determinants of relative price volatility, where balance sheet effects are captured by the interaction of a proxy for potential changes in the real exchange rate (linked to the degree of external leverage of the absorption of tradable goods) and a measure of domestic liability dollarization.     

Philanthropy and social capital in Mexico

• The aim of this paper is to examine the factors underlying philanthropic behavior in Mexico. In particular, we analyze the influence of social capital on two types of behavior: giving and volunteering. This research is based upon groundbreaking national public opinion surveys conducted in 2005 and 2008, the first of their kind in Mexico to focus on donations and volunteerism. We find that membership in associations (an important component of social capital) is strongly and positively associated with secular giving and volunteering. We also tested the role of three other aspects of social capital: participation in informal personal networks, a belief in the norm of reciprocity, and interpersonal trust, and our findings show that the former two have a consistently significant effect on our dependent variables but interpersonal trust does not. We discuss the implications of this for a society where trust in others is comparatively low. Differences between Mexico and the USA, for example, highlight the importance of context in philanthropic behavior. Mexicans' religiosity also stands out as an important variable, particularly when it comes to understanding religious forms of giving and volunteering in the country. The practical significance of our findings for the promotion of philanthropy is that Mexican nonprofits must compensate for being in a low‐trust culture by encouraging membership and a sense of group belonging.

Copyright © 2014 John Wiley & Sons, Ltd.     

Projective system approach to the martingale characterization of the absence of arbitrage

The equivalence between the absence of arbitrage and the existence of an equivalent martingale measure fails when an infinite number of trading dates is considered. By enlarging the set of states of nature and the probability measure through a projective system of perfect measure spaces, we characterize the absence of arbitrage when the time set is countable.     

Fiscal Transparency

Abstract

Quality of governance is a key for political accountability, hence, the importance of identifying its determinants. Here, we focus on one dimension of quality of governance: fiscal transparency. Drawing on a sample of 691 Catalan municipalities (2001–7), we estimate the factors determining levels of budgetary transparency. Political competition and decentralization are the most important determinants of fiscal transparency. By contrast, budgetary variables do not appear to play any role.     

How do transport costs affect firms’ exports? Evidence from a vanishing bridge

In this paper we provide estimates of the effects of international transport costs on firms’ exports and disentangle the channels of these effects. In so doing, we use a unique dataset consisting of highly disaggregated transaction-level trade and transport cost data and, in order to account for endogeneity, we exploit the exogenous variation in these costs associated with the non-trade related closure of the main bridge connecting two countries.     

Differentiation and Cost Asymmetry: Solving the Merger Paradox

This paper investigates the impact of product differentiation and of cost asymmetry on the merger paradox using a Cournot framework. It finds that when all firms share the same costs, two-firm mergers in an n firm market generate at least no profit loss when goods are sufficiently differentiated. This result contrasts with that of Salant, Switzer, and Reynolds (1983) where mergers of strategic substitutes are rarely profitable, and Deneckere and Davidson (1985 Deneckere, Raymond, and Carl Davidson. 1985. Incentives to Form Coalitions with Bertrand Competition. The RAND Journal of Economics 16 (4): 473–486.[Crossref], [Web of Science ®] , [Google Scholar]) where competition among strategic complements yields profitable mergers. Critically, when costs are asymmetric, a merger between an efficient and inefficient firm, with differentiated products, can be more profitable to participants than to excluded rivals. Following this merger, welfare is shown to increase given that the cost asymmetry between insiders is large enough.