Exploring technology paths: The development of alternative transport fuels in Sweden 2007-2020

By using socio-technical scenarios, we investigate how present policy choices may affect the development of alternative transport fuels in Sweden. One important choice for policy lies in the balance between general tax exemptions stimulating the market for alternative fuels, and funding of research and development more directly promoting new technology. The implications of this choice are illustrated with four diverging development paths until 2020. In the market-oriented scenarios, we illustrate consequences of breaking the dominance of entrenched technologies and demonstrating a growing market potential for alternatives, but also the risks with a large focus on first generation renewable fuels. In the technology-oriented scenarios, we point out the value of keeping variety among niches in this stage of the transition. In conclusion, if policy is implemented without taking the dynamic forces within the system into account, there is a risk that any measure leads the system into a dead end. But if policy strives to balance the development in different parts of the technological system while making use of various prevailing forces of change, a multitude of different efforts can contribute to the development of a more sustainable transport system.     

Modelling country default risk as a latent variable: a multiple indicators multiple causes approach

We study the determinants of country default risk by applying a Multiple Indicators Multiple Causes (MIMIC) model. This accounts for the fact that country default risk is an unobservable variable. Whereas existing (regression-based) approaches typically use only one of several possible country default risk indicators as the dependent variable, the MIMIC model enables us to consider several indicators at once. The simultaneous consideration of sovereign yield spreads and Standard and Poor (S&P) ratings may help to improve the identification of the latent country default risk. Our results confirm most of the literature's main findings regarding important determinants of country default risk, refute others and provide new evidence to controversial questions.     

Price convergence in US cities: a cointegration approach with two structural breaks

This article investigates how the price indices of major cities of the US respond to the shock from a city and from monetary policy. We find that the crisis of Bretton Woods system in 1968 and the oil crisis in 1974 should be incorporated as structural breaks in monetary policy variables and price indices. Using cointegration technique with structural break in our aggregated data, we find that the average half-life is 1.75 years, which is closer to what some of others found in disaggregated data, and that the interest rate is an effective tool for controlling cities’ price in short run.     

Does the evidence on corruption depend on how it is measured? Results from a cross-country study on microdata sets

While much of the existing literature on corruption looks at the effect of corruption on macro variables such as growth rates and income distribution, this study provides a departure by focussing on victims of corruption by using microdata to compare civilian and business corruption. This study finds that businesses face a stronger incidence of bribe demands than individuals. Though there are several differences between the determinants of the two forms of bribe victimization, there are also some similarities. Policies to combat corruption need to take into account both the differences and the similarities.     

Did FIN 48 increase companies’ tax payments? Trade-off between disclosure and tax burdens

This article examines the effects of implementing FIN 48 on companies’ tax burdens. While the literature examines how FIN 48 impacts companies’ financial reporting, its effect on tax payments has not yet been explored. We find that FIN 48 likely increased larger companies’ tax burdens. Prior to the adoption of FIN 48, larger companies may have used their asymmetric information advantage over the tax authorities to maintain relatively aggressive tax positions. To the extent that such tax-saving strategies were possible only for larger companies, FIN 48 appears to have reduced the appeal of these more aggressive tax minimization strategies.     

Do government owned banks trade market power for slack?

The ‘Quiet Life Hypothesis (QLH)’ posits that banks with market power have less incentives to maximize revenues and minimize cost. Especially government owned banks with a public mandate precluding profit maximization might succumb to a quiet life. We use a unified approach that simultaneously measures market power and efficiency to test the quiet life hypothesis of German savings banks. We find that average local market power declined between 1996 and 2006. Cost and profit efficiency remained constant. Nonparametric correlations are consistent with a quiet life regarding cost efficiency but not regarding profit efficiency. The quiet life on the cost side is negatively correlated with bank size, quality of loan portfolio and local per capita income. The last result indicates that the quiet cost life is therefore potentially due to benevolent excess consumption of local input factors by public savings banks.     

Exchange rate uncertainty and US bilateral fresh fruit and fresh vegetable trade: an application of the gravity model

In order to analyse the effect of exchange rate uncertainty, we apply an empirical gravity equation to two sets of US bilateral trade data: fresh fruit over the period 1976–1999 for a panel of 26 countries; and fresh vegetables over the period 1976–2006 for a panel of nine countries. Based on panel estimation methods, and using both a moving SD measure and the Perée and Steinherr (1989) measure of exchange rate uncertainty, the results show that US bilateral fresh fruit trade has been negatively affected by exchange rate uncertainty. We also find some evidence that the exchange rate between the US dollar and the currencies of Latin American trading partners accounts for most of the negative impact of exchange rate uncertainty on bilateral trade flows in fresh fruit. In contrast, when using panel estimation methods and both measures of exchange rate uncertainty, we find no statistically significant evidence for any negative effect of exchange rate uncertainty on US bilateral fresh vegetable trade. However, we do find a statistically significant negative effect for exchange rate uncertainty when we estimate a US export gravity equation for fresh vegetables using the same panel of countries.     

The driving forces of the level and the growth rate of real per capita income in Indonesia

We investigate the driving forces behind the level and the growth rate in real per capita Gross Domestic Product (GDP) in Indonesia. The ultimate reasons and the proximate causes underlying Indonesia's economic growth since the mid-1960s are still unclear. In the literature there have been at least three ways of investigating the driving forces of economic growth in Indonesia, namely: growth accounting system, regression and causality. The difference and improvement in this article is that we employed a two-step bounds testing approach to cointegration, which has not been done before; it uses the endogenous growth model to consider 12 policy variables and two external factors that potentially affect per capita income, this number is more than that has been done before. The empirical results that we obtained using this two-step bounds testing approach help us draw policy implications that if or when implemented would be expected to increase the growth of real per capita income, as well as the welfare of the people of Indonesia. Economic growth in Indonesia is largely driven by government policy, so the ability to increase Indonesia's economic growth rate, in the long run, will largely depend on the implementation of appropriate government policies.     

Identifying significant characteristics of organic milk consumers: a CART analysis of an artefactual field experiment

The organic dairy category is one of the fastest growing categories of organic foods in the US. Organic milk consumers generally cite perceived health benefits and lower risk of food contamination, as well as perceived superior quality and environmental sustainability of organic farming methods, as the major motivations for preference of organic over conventional milk. While the attributes of organic milk that are valued by consumers are fairly well-known, more ambiguity exists regarding the demographic characteristics of the typical organic milk consumer. This research makes use of experimental data from 148 adult participants and use a Classification and Regression Tree (CART) analysis, a nonparametric modelling approach, to identify how Willingness-to-Pay (WTP) for organic milk varies with the demographic profile of experiment participants. The study finds that perceived taste of organic milk, concern for the risk of consuming conventional milk, being a primary shopper, and the quantity of milk consumed are the major factors that separate experiment participants into groups with high and low WTP for organic milk.     

Financial innovation in the UK

This study employs a national survey of over 1100 British financial firms to ascertain the determinants of financial innovation and their sales success using the logit and the generalized Tobit models. We find that the likelihood of financial innovation rises with the size of financial firms, employee education, greater expenditure on research and development, the availability of finance and the extent to which firms cooperate with each other. Perceptions of economic risk and innovation costs are also influential. R&D, cooperation and human capital are the main variables driving the success of financial innovation, measured by the percentage share of innovations sold. Firms in London/the south have a significantly greater tendency to innovate, though Scotland also does well. Stock broking, fund management and related activities are more innovative than firms in the financial intermediation and pension/insurance sectors.