EU Enlargement and Inward FDI

The authors attempt to highlight the effects of the recent surge of FDI in the enlargement states on domestic investment and growth. A similar analysis is carried out for the EU-15 in order to ascertain whether this type of capital inflow has a differential impact in these two regions of the European Union. Empirical analysis, based on dynamic panel data models, suggests the existence of a positive contribution of FDI to greater domestic investment and economic growth in the new member states. The evidence obtained for the EU-15 old member countries confirms the FDI-growth nexus but does not suggest a positive impact of FDI on domestic investment, which would be consistent with these capital inflows being of a different nature for these more advanced economies.     

Unemployment and labour force participation in Spain

This article examines the relationship between the unemployment rate and the labour force participation rate in Spain. Cointegration analysis is performed for aggregate, male and female time-series. Results suggest that there is no a long-run relationship between the two variables for the aggregate and male cases. However, the findings support a long-run relationship between the two variables for the female time-series. Thus, the unemployment invariance hypothesis is supported in the two former cases but not in the latter.     

Argentina: Macroeconomic Crisis and Household Vulnerability*

Using panel data from the Argentine Permanent Household Survey, this paper analyzes which households were more vulnerable to the Argentine macroeconomic crisis during 1999–2002. Results suggest that the impact of the crisis was not uniform across households, which differed in their ability to cope with shocks. In particular, households with more children, and whose head was male, less educated, and employed in the private sector were the most vulnerable, suffering larger than average declines in income. Shocks to labor income were significant, with both unemployment rates and unemployment spells increasing throughout the period, particularly during the peak of the crisis towards the end of 2001. Individuals with low levels of human capital (proxied by education and experience), males, and self‐employed were more likely to lose their jobs. Public sector employees, in contrast, were more protected from the impact of the crisis on employment.     

Economic performance and international trade engagement: the case of Portuguese manufacturing firms

By combining economic and financial data for Portuguese manufacturing firms with data on their exports and imports, we uncover some aspects of the relationship between international trade engagement and firms’ performances. In line with recent theoretical and empirical developments in the international trade literature: (i) we testify that Portuguese international trade is highly concentrated, especially on the import side, and both in inter- and intra-sector terms; (ii) we corroborate previous studies and theses according to which two-way traders outperform only importers, only exporters and above all domestic firms; (iii) we find that the greater the diversification of markets and goods (especially with regard to imports), the better the performance achieved by internationalised firms; (iv) we notice that the higher the intensity of firms’ international trade (especially imports), the better their performance; (v) we also present evidence that destination markets for exports and origin markets for imports are also important in explaining firm’s performance.     

Measurement of Advertising Effectiveness： How Different Theories About the Relative Importance of Sales vs. Recall/Recognition vs. Emotion Were Popular

The aim of this chapter is to run through the history of marketing research applied to measuring the effectiveness of advertising and deepen in all those theories that have shed light on this aspect and have influenced subsequent theories and models. This historical review offers the opportunity of knowing the past and understanding better the present of market research applied to advertising. It is a chronological analysis to present day, which introduces the development of the explanatory models for the functioning of advertising and the theoretical and empirical contributions in this area.     

Persistent gaps and default traps

We show how vicious circles in countries' credit histories arise in a model where output persistence is coupled with asymmetric information about output shocks. In such an environment, default signals the borrower's vulnerability to adverse shocks and creates a pessimistic growth outlook. This translates into higher interest spreads and debt servicing costs relative to income, raising the cost of future repayments, thereby creating “default traps”. We build a long and broad cross-country dataset to show the existence of a history-dependent “default premium” and of significant effects of output persistence on sovereign creditworthiness, consistent with the model's predictions.     

Estimators for the common principal components model based on reweighting: influence functions and Monte Carlo study

The common principal components model for several groups of multivariate observations is a useful parsimonious model for the scatter structure which assumes equal principal axes but different variances along those axes for each group. Due to the lack of resistance of the classical maximum likelihood estimators for the parameters of this model, several robust estimators have been proposed in the literature: plug-in estimators and projection-pursuit (PP) type estimators. In this paper, we show that it is possible to improve the low efficiency of the projection-pursuit estimators by applying a reweighting step. More precisely, we consider plug-in estimators obtained by plugging a reweighted estimator of the scatter matrices into the maximum likelihood equations defining the principal axes. The weights considered penalize observations with large values of the influence measures defined by Boente et al. (2002). The new estimators are studied in terms of theoretical properties (influence functions and asymptotic variances) and are compared with other existing estimators in a simulation study.     

What drives idiosyncratic volatility over time?

We document the patterns of market-wide and firm-specific volatility in the Portuguese stock market over the 1991–2005 period and test several explanations for the behavior of firm-level idiosyncratic volatility. Unlike previous studies we find no evidence of a statistically significant rise in firm-specific volatility. On the contrary, the ratio of firm-specific risk to total risk slightly decreases. We show that this result stems from new listings of large privatized companies that display lower firm-specific risk. Our findings are consistent with the idea that changes in idiosyncratic volatility are related to changes in the composition of the market.

Performance signals in the public sector: the case of health care

Although there are no traditional markets and money prices inthe public sector, consumers and providers may respond to signalsof organisational performance. We present a simple dynamic modelof the demand and supply for elective surgery in the UK NationalHealth Service in which waiting time acts as the prime indicatorof performance. The model is tested using a panel of quarterlydata for 123 English health authorities over an eight-year period.We find that supply is increasing and demand is decreasing inmeasures of the previous period waiting time. The results implythat health care systems which are rationed by waiting do respondto indicators of waiting times. The paper adds to the smallbut consistent body of research which demonstrates that publicsector systems respond to important aspects of reported performance.