Social identity and preferences over redistribution

We design an experiment to study the effects of social identity on preferences over redistribution. The experiment highlights the trade-off between social identity concerns and maximization of monetary payoffs. Subjects belonging to two distinct natural groups are randomly assigned gross incomes and vote over alternative redistributive tax regimes, where the regime is chosen by majority rule. We find that a significant subset of the subjects systematically deviate from monetary payoff maximization towards the tax rate that benefits their group when the monetary cost of doing so is not too high. These deviations cannot be explained by efficiency concerns, inequality aversion, reciprocity, social learning or conformity. Finally, we show that behavior in the lab helps explain the relationship between reported income and stated preferences over redistribution observed in survey data.     

Learning from exporting: The moderating effect of technological capabilities

There is evidence that exporters are more productive than non-exporters. Scholars argue that exporters may have access to knowledge spillovers in foreign markets and use this knowledge to become more efficient. However, we know little about whether learning from exporting is affected by firms’ heterogeneous resource endowments and, particularly, about the specific firm characteristics that matter the most in this respect. Utilizing a sample of 1534 Spanish manufacturing firms from 1990 to 2002, we empirically analyze whether a firm's technological capabilities (proxied by its relative R&D expenditures) affect its ability to learn from the interaction with foreign agents. We find that firm productivity increases after exporting for all firms. However, ex post productivity improvements are larger for the more technologically advanced firms than they are for their less technologically advanced counterparts. Our results show that some firms stand to benefit more from exporting than others and hint at the importance of absorptive capacity for knowledge acquisition overseas.     

Introducing the mini-futures contract on Ibex 35: implications for price discovery and volatility transmission

This paper analyzes the effects of the introduction of the mini-futures contract in the Spanish stock index futures market. The objective of the paper is twofold: (a) to analyze the potential destabilizing effect of the mini futures trading activity on the distribution of spot returns, and (b) to test whether the mini futures contract significantly contributes to the price discovery process. A non-parametric approach is used to estimate the density function of spot return conditional to both spot and futures trading volume. Empirical findings using 15-min intraday data reveal that the mini futures trading activity enhances the price discovery function of the derivative market and does not destabilize spot prices. A preliminary version of this paper has been previously published as a working paper of the Instituto Valenciano de Investigaciones Económicas, WP-EC 2004-13. M. Illueca and Juan A. Lafuente acknowledge financial support from Spanish ministry of Science and Technology through grants SEJ-2005-02776, and both SEJ2006-14354 and BEC-2003-03965, respectively.     

Demand and supply estimation biases due to omission of durability

We build a dynamic equilibrium model of a durable goods oligopoly with a competitive secondary market to evaluate the bias in estimating the structural parameters of demand and supply when durability is omitted. We simulate data from our dynamic model and use them to estimate the model’s static counterpart. We find that the static estimate of the elasticity of demand is an overestimate of the true elasticity and that the static estimate of the markup is an underestimate. Our results provide a benchmark on the magnitude and sign of the bias when static models are used for economic inference.     

Work values,endogenous sentiments redistribution

We examine the interactions between individual behavior, sentiments and the social contract in a model of rational voting over redistribution. Agents have moral “work values”. Individuals' self-esteem and social consideration of others are endogenously determined comparing behaviors to moral standards. Attitudes toward redistribution depend on self-interest and social preferences. We characterize the politico-economic equilibria in which sentiments, labor supply and redistribution are determined simultaneously. The equilibria feature different degrees of “social cohesion” and redistribution depending on pre-tax income inequality. In clustered equilibria the poor are held partly responsible for their low income since they work less than the moral standard and hence redistribution is low. The paper proposes a novel explanation for the emergence of different sentiments and social contracts across countries. The predictions appear broadly in line with well-documented differences between the United States and Europe.     

Cyclical behavior of crude oil markets and economic recessions in the period 1986–2010

For at least one century, crude oil has been one of the most important commodities for the worldwide economic activity. Important technological innovations, including chemical transformation processes and transportation systems, have been based on the availability or not of crude oil. In this way, a close understanding of the crude oil market dynamics should provide insights in important aspects related to potential directions of technological change for both improving crude oil transformation efficiency and substitution by alternative energy sources. This paper studies the dynamics of the crude oil price for the period from 1986 to 2010. To this end, the entropy time-asymmetry is computed along the price trajectory. Empirical results indicated the presence of a non-regular cyclical behavior with a dominant period of about 4.5 years. Some evidences pointing toward a comovement of entropy time-asymmetry peaks with major US economic recessions are found, suggesting a tight relationship between macroeconomy and crude oil prices. The results are discussed in terms of the major economic events that occurred in the upward and downward cycle periods and potential implications for the design of energy policies.     

Resource constraints and educational attainment in developing countries: Colombia 1945–2005

In this paper, I investigate the extent to which secondary and higher education supply constraints affected aggregate educational attainment in Colombia for cohorts born between 1945 and 1981. As was the case in many other countries after World War II, in Colombia, industrialization, urbanization and rapid population growth increased the demand for education and the return to schooling. Although educational expenditures from the central government and the states increased after the 1950s, secondary and tertiary schools' per-pupil inputs declined. Using variation in cohort size within states and over time to proxy for changes in education demand, I find that for cohorts born after 1945, a 10% increase in cohort size reduced high school completion rate by 3%, the college completion rate by 4% and average years of schooling by 1%. Compared to women's educational attainment rates, changes in cohort size had greater negative effects on men's rates.     

Social-ecological resilience and community-based tourism: An approach from Agua Blanca,Ecuador

Socio-ecological resilience (SER), as a theoretical framework, provides an original approach to the study of socio-ecological sustainability, affirming that sustainable development can only be achieved in sufficiently resilient socio-ecosystems. Sustainability is one of the major challenges facing tourism. Therefore, the exploratory application of this theoretical approach to tourist contexts could be particularly apt. Practically all current modes of tourist operation profess a commitment to sustainability, but this is much more significant in experiences of community-based tourism (CBT). This paper presents an ethnographic case study in Agua Blanca, an Ecuadorian community that engages in turismo comunitario, a community-based tourism development strategy. The study explores the expediency of studying socio-ecological resilience in tourist research and attempts to open up new pathways for analytical and methodological development.