Fraudulent collection of unemployment benefits : A theoretical analysis with reference to income tax evasion

The harshest abusers of the unemployment insurance program are those employed who collect benefits while working. This paper analyzes fraudulent claiming behavior and optimal deterrence policy under two alternative penalty schemes, commonly used in tax evasion analyses: one relates punishment to the magnitude of the dishonesty, whereas the other relates punishment to the amount of illegal returns. Two exclusive features of fraudulent benefit claiming are given special attention: the requirement to report at a labor exchange to demonstrate availability for work, and the need to serve a waiting period before benefits can be collected.     

The water market in Israel: An example for increasing the supply

In this study we search for solutions to the problem of Israel's water shortage. To illustrate the shortage, we first model the water market in Israel, i.e., the corresponding supply and demand of water, and from it the dynamics of water prices. A direct way to solve the shortage problem and to reduce the high equilibrium price can be found via a different way of sharing water among the Levant countries, or by bringing more water from outside the region. The latter can take the form of conveying Nile water or water from Turkey or by constructing desalination plants along the shores. In this study we concentrate on the importing of Nile water.The costs of most of the solutions are too high compared to the returns to water in agriculture. This relation is continuously changing with the increasing demand for water for domestic and agricultural use. Our analysis shows that within 5–10 years the marginal value product of water in the area west of the Jordan river would equal the marginal costs of water from the Nile, $0.40m³.     

Do the intradeciles inequalities matter? A note

Using an algorithm suggested by Berrebi and Silber (1987) and assuming that the population within any decile is distributed uniformly between its boundsa andb, the paper shows that the intradecile inequality is generally not important and may be ignored. This finding is useful in empirical analysis, even today, when inequality indices are sought. Although current microdata sets from which the Gini indices can be calculated directly are widely available, past data are still in use and the new data are not always accessible to the interested user in micro detail, while the deciles bounds are very frequently reported. The study also points to a new constant. The Gini of a variable over the interval [0,b] when there is a large number (n>100) of individuals and the variable is distributed uniformly, is 1/3 regardless of the value ofb.     

Market vs social valuation of redevelopment projects in an urban setting

A conventional urban model is employed to investigate the effect of urban renewal-which leads to an increase in the intensity of land use on the rent revenue from the area that is directly affected by the development. It is shown that rent revenue would increase when the project covers less than 80% of the city area. If it covers more than 80%, rents might be reduced. Hence, in the former case market forces can be relied upon as guides for socially desirable projects.     

Tax Evasion, Risky Laundering, and Optimal Deterrence Policy

This paper extends the Allingham and Sandmo's (1972) model of income tax evasion to take account of laundering opportunities, allowing the taxpayer to determine not only the amount of actual income to declare but also the amount of undeclared income to launder. Laundering, aside of entailing direct costs, is assumed to be an unlawful activity, subject to the risk of detection and punishment. The tax authorities devote separate resource efforts to initial audits which may detect undeclared income that has not been laundered and to in-depth investigation which may detect undeclared income that has been laundered. The paper analyzes the effects of laundering incentives on evasion and derives guidelines for the optimal design of a joint evasion/laundering deterrence policy. This revised version was published online in July 2006 with corrections to the Cover Date.     

Testing the nexus between renewable energy consumption and environmental quality in Nigeria: The role of broad‐based financial development

This study investigates the nexus between renewable energy consumption and environmental quality in Nigeria, accounting for the role of financial development, and re‐examines the validity of the environmental Kuznet curve (EKC) hypothesis for Nigeria covering the period 1990 to 2016. To cover financial development more adequately, the current study uses the broad‐based financial development index constructed by the International Monetary Fund. The study employs second generation econometric approaches of Lee and Strazicich, and Bayer and Hanck combined cointegration tests to check for stationarity and cointegration among the variables, and then applies autoregressive distributed lag (ARDL) and vector error correction model (VECM) Granger causality tests to explore the effect and causal relationship respectively. The results divulge that renewable energy consumption improves environmental quality, while financial development hurts the environment. Further, the results validate an inverted U‐shaped association between economic growth and environmental degradation in Nigeria. The VECM Granger causality results indicate a long‐run effect of the independent variables on CO₂ emission, while the short‐run causality reveals a mixture of unidirectional and bidirectional causality among the variables. This study therefore recommends that policy makers consider the important roles of renewable energy and financial development in reforming energy policies to achieve environmental sustainability.     

Should Africa’s emerging markets still be considered as a separate asset class?

This article examines the correlation of Africa’s emerging markets regionally and globally using the Continuous Morlet Wavelet (CMW) transform. The superiority of this technique is that it is able to estimate correlation in a time-varying manner and derive all information about structural changes in the data through a phase difference technique. We find that Africa’s emerging equity markets are partially segmented regionally and globally. Although correlations may have increased over time, we suggest that emerging markets in Africa should still be considered as a separate asset class.     

The impact of execution delay on the profitability of put‐call‐futures trading strategies—Evidence from Taiwan

This study examines the impact of execution delay on the profitability of put‐call‐futures quasi‐arbitrage strategies using trade and quote data in the Taiwanese market. Assuming order execution at the next immediate price following a mispricing signal, the execution of individual components is traced and a substantial delay resulting from the late execution of an option is reported. A fill‐or‐kill strategy that directly restricts such a delay is unsatisfactory because unwinding already acquired positions involves added transaction costs. Ex ante performance is significantly improved for combined strategies that execute the less liquid asset first, while shortening the time before acquisition of the first position. © 2007 Wiley Periodicals, Inc. Jrl Fut Mark 27:361–385, 2007     

Measuring Core Inflation in South Africa

Measures of core inflation convey critical information about an economy. They have a direct effect on the policymaking process, particularly in inflation‐targeting countries, and are utilised in forecasting and modelling exercises. In South Africa, the price indices on which inflation is based have been subject to important structural breaks following changes to the underlying basket of goods and the methodology for constructing price indices. This paper seeks to identify a consistent measure of core inflation for South Africa using trimmed means estimates, measures that exclude changes in food and energy prices, dynamic factor models, and wavelet decompositions. After considering the forecasting ability of these measures, which provide an indication of expected second‐round inflationary effects, traditional in‐sample criteria were used for further comparative purposes. The results suggest that wavelet decompositions provide a useful measure of this critical variable.