Information regulation: Do the victims of externalities pay attention?

Individuals living in metropolitan areas are exposed to a large number of industrial risks. Information regulation is a new tool to manage such risks. We ask if large-scale information initiatives directed at the general public can affect individual risk perceptions. The answer is affirmative. Using the publication of the Toxics Release Inventory as a case study, we find a decline in predicted property values when new information on pollution became available, indicating that homebuyers adjusted their risk perceptions upward. The response, however, is limited to sources of toxic emissions that are located at a moderate distance from the properties in our sample.      

Revisiting "The Fallacy of Free Trade"

The paper examines results presented by Batra in an article entitled "The Fallacy of Free Trade" ( Review of International Economics 1(1) (1992): 19–31). Batra contends that technical change in Japanese manufacturing necessarily reduces US real wages in the confines of a two-good, two-country Ricardo-Viner model. A parsimonious empirical Ricardo-Viner model is constructed to analyze the same issue. It is found that the impact on US real wages is very small. Systematic sensitivity analysis shows that increases in the ral wage are as likely as decreases. It is concluded that Batra's assertions are empirically unlikely.     

Key issues in regional growth and integration in Southern Africa

ABSTRACT

The decade to 2015 saw rapid growth in trade between Southern African Development Community (SADC) countries. Much of this growth reflected South African exports to its neighbours of diversified manufactured goods to meet growing urban consumption and to supply inputs to mining and infrastructure. While most SADC countries, aside from South Africa, grew quite rapidly over this period, their exports remained oriented to a narrow range of minerals and agricultural commodities destined to go outside the region. Drawing from a series of sectoral studies, we assess key regional issues including the investment and production decisions of firms whose operations stretch across borders, and consider the implications for a bottom-up integration agenda that could build productive capabilities across countries. Our evaluation highlights the importance of the spread of supermarkets, the need to address transport and logistics, and value chains whose competitive advantages are inherently regional, as in the cases of poultry and mining.     

Financing a Portfolio of Projects

This article shows that investors financing a portfolio of projectsmay use the depth of their financial pockets to overcome entrepreneurialincentive problems. Competition for scarce informed capitalat the refinancing stage strengthens investors' bargaining positions.And yet, entrepreneurs' incentives may be improved, becauseprojects funded by investors with "shallow pockets" must havenot only a positive net present value at the refinancing stage,but one that is higher than that of competing portfolio projects.Our article may help understand provisions used in venture capitalfinance that limit a fund'sinitial capital and make it difficultto add more capital once the initial venture capital fund israised.     

On portfolio optimization: Imposing the right constraints

We reassess the recent finding that no established portfolio strategy outperforms the naively diversified portfolio, 1/N, by developing a constrained minimum-variance portfolio strategy on a shrinkage theory based framework. Our results show that our constrained minimum-variance portfolio yields significantly lower out-of-sample variances than many established minimum-variance portfolio strategies. Further, we observe that our portfolio strategy achieves higher Sharpe ratios than 1/N, amounting to an average Sharpe ratio increase of 32.5% across our six empirical datasets. We find that our constrained minimum-variance strategy is the only strategy that achieves the goal of improving the Sharpe ratio of 1/N consistently and significantly. At the same time, our developed portfolio strategy achieves a comparatively low turnover and exhibits no excessive short interest.     

High Technology Employment,Wages And University R&D Spillovers: Evidence From Us Cities

Using 4 years of data from 36 American cities and 6 high technology groupings we present thc first estimates of University R&D spillover effects on ctnployrnent at this level of disag-gregation, while controlling for wages, prior innovations, state fixed efrccts, and saniple selectivity hias. We find robust evidence that lagged and disaggrcgated university R&D is a significant determinant of city high technology employment and some evidence for employment effects of innovation.     

Déjà vu Geopolitics: Marxism and the Geopolitical Undead

Undead, unkillable and uncannily, unceasingly trendy, ‘geopolitics’ strikes again. Marxist geopolitics could have been a good idea - for Marxists at least. This version doesn't work for two reasons: first, its emphasis on the inter-relationship between territory, capitalism and power makes it virtually indistinguishable from Marxism writ large; and second, it re-legitimates some of the familiar yet noxious tropes of classical geopolitics.