The impact of the net percentage growth rate in the number of small firms on differential state-level employment growth rates in the US: an exploratory empirical note

This brief exploratory empirical note seeks to identify key determinants of geographic differentials in the percentage growth rate of state-level employment in the US, with the primary focus being on the percentage net growth rate in the number of small firms (i.e., those with fewer than 20 employees) in each state, where this variable serves as a de facto reflection of ‘entrepreneurship’. In the interest of identifying other key factors that influence state-level employment growth rates, the effective income tax rate in each state, quality of life elements and labour market considerations are also included in the analysis. The study period runs from the year 2000 to the year 2007, ending just prior to the ‘Great Recession’. The estimation results imply that the state-level employment growth rate in the US was an increasing function of the percentage net growth rate in the number of small firms in each state. Thus, it appears that the small firms growth rate may in fact be a significant source.     

Individual attitudes towards the impact of multinational corporations on local businesses: how important are individual characteristics and country-level traits?

We study the importance of individual characteristics and national factors influencing individual attitudes towards the impact of multinational corporations on local businesses. Our sample includes more than 40 000 respondents in 29 countries from the 2003 National Identity Survey conducted by the International Social Survey Programme. We find that individual demographic factors and socioeconomic status, such as gender, age, income and education, are strong predictors of their attitudes. For example, income and education are positively associated with favourable attitudes towards the impact of multinational corporations (MNCs) on local businesses while age is negatively associated with individual attitudes towards MNCs. In addition, hierarchical ordered logit model results show that approximately 8% of total variations in individual attitudes around our sample mean are not explained by differences in personal traits. Instead, they are due to country-level heterogeneity such as, but not limited to, different degrees of openness or different aggregate income.     

Dining out,the missing food consumption in China

Food security concern in China is also the world’s concern. Studies on food consumption in the past, however, often neglected the increasing food consumed away from home (FAFH). Drawn on a survey data recently conducted in nine cities by a week-long diary method, we found that FAFH in urban China accounts for a significant proportion of total food consumption, although its share varies by food category. With substantial expected income growth, overall FAFH consumption will likely continue to rise, but would be negatively affected by the rapid societal aging process, both in dining out probability and per capita consumption level. The main findings of this study have implications for food processing and service industries as well as for studies in food-related environmental issues.     

The cost-effectiveness of exenatide twice daily (BID) vs insulin lispro three times daily (TID) as add-on therapy to titrated insulin glargine in patients with type 2 diabetes

Objective: To evaluate the cost-effectiveness of exenatide twice daily (BID) vs bolus insulin lispro three times daily (TID) as add-on therapy when glycemic control is sub-optimal with titrated basal insulin glargine and metformin.

Methods: The analysis was based on the recent 4B Study, which compared exenatide BID and lispro TID as add-on therapies in subjects with type 2 diabetes insufficiently controlled, despite titrated insulin glargine. The Cardiff Diabetes Model was used to simulate patient costs and health benefits beyond the 4B Study. The Swedish healthcare perspective was adopted for this analysis; costs are reported in €EUR to aid interpretation. The main outcome measure was the cost per quality-adjusted life-year (QALY) gained with exenatide BID compared to lispro TID.

Results: Exenatide BID was associated with an incremental cost of €1,270 and a QALY increase of +0.64 compared with lispro TID over 40 years. The cost per QALY gained with exenatide BID compared with lispro TID was €1,971, which is within conventional limits of cost-effectiveness. Cost-effectiveness results were generally robust to alternative assumptions and values for key model parameters.

Limitations: Extrapolation of trial data over the longer term can be influenced by modeling and parameter uncertainty. Cost-effectiveness results were generally insensitive to alternative values of key model input parameters and across scenarios.

Conclusions: The addition of exenatide BID rather than insulin lispro to basal insulin is associated with similar or better clinical outcomes. Illustrated from the Swedish healthcare perspective, analysis with the Cardiff Diabetes Model demonstrated that exenatide BID represents a cost-effective treatment alternative to lispro TID as add-on therapy in type 2 diabetes patients insufficiently controlled on basal insulin.     

Selection on performance and tracking

Tracking is widely used in secondary schools around the world. Some countries put more emphasis on the use of performance to place students into tracks (e.g. the Netherlands), while in other countries parents have more influence on the track their child will go to (e.g. Germany). This article examines whether selection into tracks based on performance has an effect on the relation between tracking and student performance and educational opportunities. Using data from the Programme for International Student Assessment for around 185 000 students in 31 countries, different estimation models are compared. The results indicate that a highly differentiated system is best for performance when schools always consider prior performance when deciding on student acceptance. In systems with a few tracks, there is no such impact. Equality of opportunity is best provided for in a system with many tracks when schools always consider prior performance.     

The asymmetric relationship between executive earnings management and compensation: a panel threshold regression approach

Prior research shows that chief executive officers (CEOs) are rewarded for their earnings management. We re-examine this issue using a panel threshold regression approach, which allows the effect of earnings management on the CEO compensation to change across the level of earnings management and CEO compensation. Our results show that the effect of CEOs’ discretionary accounting choices on their compensation is not homogeneous across various degrees of earnings management and compensation. In particular, for firms with moderate (inordinate) levels of earnings management and CEO compensation, earnings management is rewarded (penalized).     

The motor vehicle industry in an emerging nation: the case of Brazil

As in other emerging nations, in Brazil, the motor vehicle industry is considered to be strategically important for economic development because of its backward and forward linkages and possibilities for export-led growth. This study analyses prospects for the industry by estimating an industry-level cost function that includes output of both vehicles and component parts with capital, labour and intermediate goods as inputs. The cost elasticity of output (an indicator of scale properties) and the elasticity relationships among inputs are explored. One unexpected outcome of the work that appears to be robust is that during early years of the study period, the industry had constant returns or even diseconomies of scale. However, during later years, when output was greater, there were economies of scale. This finding is likely the result of some combination of the entry of new firms, the development of new models or technological change. The study concludes that if firm output can be increased, economies of scale can be expected to strengthen the position of the Brazilian industry in the international marketplace.     

Robust political economy

This paper introduces the idea of “robust political economy.” In the context of political economic systems, “robustness” refers to a political economic arrangement's ability to produce social welfare-enhancing outcomes in the face of deviations from ideal assumptions about individuals' motivations and information. Since standard assumptions about complete and perfect information, instantaneous market adjustment, perfect agent rationality, political actor benevolence, etc., rarely, if ever actually hold, a realistic picture and accurate assessment of the desirability of alternative political economic systems requires an analysis of alternative systems' robustness. The Mises-Hayek critique of socialism forms the foundation for investigations of robustness that relax ideal informational assumptions. The Buchanan-Tullock public choice approach complements this foundation in forming the basis for investigations of robustness that relax ideal motivational assumptions. JEL Code B53, P16, P26