Spot water markets and risk in water supply

Water availability patterns in semiarid regions are typically extremely variable. Even in basins with a highly developed infrastructure, users are subject to unreliable water supplies, incurring substantial economic losses during periods of scarcity. More flexible instruments, such as voluntary exchanges of water among users, can help users to reduce risk exposure. This article looks at the effects of spot water markets on the economic risk caused by water availability variations. Our theoretical and empirical risk analyses are based on the random profits of water users. Profit probability density functions are formally and graphically characterized for both water sellers and buyers under several possible market outcomes. We conclude from this analysis that, where water supply is stochastic, water markets unambiguously reduce both parties' risk exposure. The empirical study is conducted on an irrigation district in the Guadalquivir Valley (Southern Spain), where there is a high probability of periods of extreme water scarcity. Water demand functions for the district representative irrigators and a spatial equilibrium model are used to simulate market exchanges and equilibrium. This programming model is combined with statistical simulation techniques. We show that the profit probability distribution of a representative irrigator is modified if water exchanges are authorized, leading to risk reductions. Results also indicate that if the market were extended to several districts and users that are subject to varying hydrological risk exposure, extremely low‐profit events would be less likely to occur. In sum, we show that exchanging water in annual spot markets can reduce farmers' economic vulnerability caused by water supply variability across irrigation seasons. These results support the water policy reform carried out in Spain in 1999 to allow for voluntary water exchanges among right holders.     

Tradable water saving certificates to improve urban water use efficiency: an ex‐ante evaluation in a French case study

This paper proposes a system of tradable Water Saving Certificates to improve the efficiency of water allocation between Drinking Water Utilities at river basin level. A market institutional set‐up, inspired from recent policy developments in the energy sector, is proposed. An original analytical price‐endogenous model is developed to simulate trade intensity, equilibrium price and efficiency gains in this urban water market. The economic model is implemented in a French case study using mathematical programming. It is used for conducting an ex‐ante evaluation of trade possibilities and efficiency gains, considering different spatial restrictions aimed at controlling environmental externalities. Our modelling exercise provides evidence of the benefits of the proposed Water Saving Certificate scheme.     

Urban destination loyalty drivers and cross-national moderator effects: The case of Barcelona

The objective of this paper is to analyze the loyalty of tourists to urban tourism destinations, studying the differences existing on the basis of nationality of origin. The review of the academic literature identified perceived value and satisfaction as antecedents of loyalty. A theoretical model was constructed which was tested empirically with a total of 927 surveys of Italian and American tourists in the city of Barcelona. In the study of the data, structural equation models (SEM) were used, by means of a multi-group analysis. The empirical results show that the causal relationships among perceived value, satisfaction and loyalty and the moderating effect of nationality are partially confirmed. This study contributes to better knowledge of the processes that lead tourists to be loyal to an urban tourism destination.     

Entrepreneurial dynamics of the self-employed and of firms: a comparison of determinants using Spanish data

Entrepreneurship is viewed at either an individual level (self-employment), or a firm level (firms’ creation) phenomenon. We also observe the self-employed and firms that hire employees and grow, and others that do not. This paper theorizes occupational and firm-creation decisions and uses Spanish data on industry, region and time to compare entrepreneurial indicators based on official statistics of the number of self-employed individuals and of the number of firms, both with and without employees. The results show that there are important differences in the patterns of the determinants of growth rates in the self-employed and in firms and, within each of them, between those that hire employees and those that do not. We establish sound arguments to recommend the highest level of disaggregation possible in entrepreneurship studies.     

Testing for structural stability in the whole sample

The paper examines a Lagrange Multiplier type test for the constancy of the parameter in general models with dependent data without imposing any artificial choice of the possible location of the break. In order to prove the asymptotic behaviour of the test, we extend a strong approximation result for partial sums of a sequence of random variables. We also present a Monte-Carlo experiment to examine the finite sample performance of the test and how it compares with tests which assume some knowledge of the possible location of the break.     

Labor Market Analysis and Public Policy: The Case of Morocco

This article uses detailed industry and household data to understandwhy Morocco's labor market performed poorly in 1985–95.The data indicate that marked structural changes and weak demandin the product market were responsible. This article makes twocontributions to the literature. The first is specific: it underscoresthat the demand for labor is a derived demand and that the performanceof the product market is an important determinant of the performanceof the labor market. The second is more general: it demonstratesthat this kind of microeconomic analysis, using data sets thatare often available in developing countries, can inform policydesign.     

Is globalisation undermining the welfare state?

This paper analyses the evolution of the welfare states in themajority of OECD countries during the pre-globalisation (1946–80)and globalisation (1980–2000) periods. Our purpose isto find out whether globalisation has produced a convergencetowards a smaller welfare state, funded increasingly by non-mobilefactors such as labour, property and consumption rather thanby mobile factors such as capital. The data presented here challengethe claims about such a convergence, showing that social publicexpenditures and public employment have continued to expandduring the globalisation period in most OECD countries. We alsoshow that the welfare states remain rooted in the politicaltraditions that have governed them.     

Delaying retirement in Spain

We study the reform of the Spanish public pension system in a multiperiod, general equilibrium, overlapping generations model economy populated by heterogeneous households. Our households differ in their place of birth, in their age, in their education and, endogenously, in their employment status, in their wealth, and in their pension entitlements. They receive a stochastic endowment of efficiency labor units each period. And they face a disability risk and a survival risk. They understand the link between the payroll taxes that they pay and the public pensions that they receive. And they decide how much to consume and to work, and when to retire from the labor force. We calibrate this economy to Spanish data, and we use it to study the consequences of delaying three years the statutory retirement ages in 2010. We find this reform is sufficient to solve the sustainability problems that plague the current Spanish public pension system. Our model economy predicts that under the current rules, the pension system fund will run out in 2028 and in the reformed economy it will last until 2050. We also find that it is moderately expansionary, and that it improves social welfare from the year 2015 onwards. We conclude that policymakers should seriously consider delaying the statutory retirement ages in Spain sometime in the near future.