The role of environmental factors in water utilities’ technical efficiency. Empirical evidence from Spanish companies

This article computes input-specific scores of technical efficiency for a sample of water utilities located in the southern Spanish region of Andalusia. In addition, differences in efficiency between different operating environments are investigated. Concerning the debate about ownership and efficiency, we find that privately owned companies outperform public utilities in their management of labour. Furthermore, technical efficiency is found to be greater among firms located in highly populated areas and for utilities providing water services to tourist municipalities. Finally, no empirical evidence supporting the greater technical efficiency of consortia of water utilities, a managerial strategy strongly encouraged by regional politicians, is found.     

Using propensity matching estimators to evaluate the impact of privatization on wages

Whether the transfer of ownership rights to the private sector leads to a decline or increase in wage growth is theoretically ambiguous, given that the outcome depends on the uncertain interaction between firms and workers. Using propensity matching techniques, this article investigates the effects of privatization on wages in the Portuguese banking industry. The empirical results, obtained from Quadros de Pessoal for the period between 1989 and 1997, generally show a negative (positive) short-run (long-run) effect of privatization on relative wage growth for both men and women retained in the privatized firms. Moreover, the results show that the most educated and experienced (oldest) workers, as well as those in the high skill occupational categories, were more likely to experience a negative wage effect.     

On causality in the size-efficiency relationship: the effect of investor cash flows on the mutual fund industry

One of the perceived advantages in mutual fund management is the presence of economies of scale resulting from fund size. This article analyses the impact of mutual fund cash flows on the relation between size and performance, demonstrating that performance determines asymmetric variations in fund assets, particularly in mutual equity funds. Therefore, the more efficient funds generate broad enough cash flow entry that increases the relative size of the fund, leading to an implicit and positive relation between size and performance. So, if the average size over the period sample is used as a measure of size, such a relation would be biased. When the initial size is used, this bias is avoided and, in general, an insignificant relation is found between size and performance. These results are controlled by mutual fund costs using gross returns to estimate performance. The evidence is robust, and shows only weak evidence of a negative relation between size and performance for the balanced funds that is driven by a low positive relation between costs and size; precisely, the contrary that is expected from the hypothesis of the presence of economies of scale.     

Shifts in Portfolio Preferences of International Investors: An Application to Sovereign Wealth Funds

We develop a dynamic general equilibrium model to analyze the macroeconomic effects of a shift in portfolio preferences of foreign investors. The model has two countries and two asset classes (equities and bonds). It is characterized by imperfect substitutability between assets and allows for endogenous adjustment in interest rates and asset prices. To illustrate the mechanics of the model, we calibrate it to analyze a transfer of reserves from central banks to sovereign wealth funds (SWFs). We look separately at two diversification paths: a shift away from dollar assets (path 1), and a shift away from US bonds to US equities (path 2). In path 1, the dollar depreciates and US net debt falls on impact and increases in the long run. In path 2, the dollar depreciates and US net debt increases in the long run.     

Evidence on the purchasing power parity in a panel of cities

Evidence is provided on the PPP hypothesis using a sample of 50 Spanish cities for a long time period through the application of panel data unit root tests. Although results suggest non-rejection of the PPP, short-run deviations – as measured by half-lives – indicate that real factors might be causing a slow rate of convergence to a common price index, even in highly integrated economies.     

The determinants of trade performance: influence of R&D on export flows

A theoretical model is presented, in which supply side differences between countries determine international trade flows. This model is empirically tested at a sectoral level for a group of EU countries, within a framework that focuses on changes through time and differences between countries. The results show that the validity of the theoretical model is limited at sectoral level. However, as expected, we find that the variable representing technological differences is significant and correctly signed for high-technology sectors. The evidence points to the existence of different production functions across countries and to the importance of supply side factors in determining the direction and the terms of trade.     

State English-only policies and English-language investments

Many states in the US have considered adopting ‘English-only’ legislation since the early 1980s. This paper argues that this legislation has a variety of expected and unexpected outcomes. Using the 1980 and 1990 Integrated Public Use Microdata Series (IPUMS), this study finds that Asian immigrants in general and Hispanic immigrants who arrived to the US prior to 1970 acquired more English fluency on average during the 1980s when residing in states that passed English-only (EO) legislation compared to their similar peers. The passage of such legislation also appears to have distorted residence decisions as well as the relative quality of immigrants between EO and non-EO states.     

Frictional wage dispersion with Bertrand competition: An assessment

I examine whether a version of the Cahuc et al. (2006) model can match the magnitude of wage dispersion, as measured by the ratio of the average and the lowest wage — the so-called mean-min ratio of Hornstein et al. (2011). I find that the workers? bargaining power is a crucial parameter: the mean-min ratio strictly decreases in the bargaining power up to a point near 1/2 and is essentially flat thereafter, generating the same amount of wage dispersion as the canonical wage ladder model, which is a special case of the CPVR model. Consequently, this model can yield large wage dispersion only for low bargaining power on the workers? side. I show that the share of job-to-job transitions with wage drops is decreasing in the bargaining power, calibrate the latter to the former, and demonstrate that the CPVR model generates an empirically plausible amount of wage dispersion. I also show that negative wages arise when workers have no bargaining power, and discuss the implications for the empirical findings of Postel-Vinay and Robin (2002b).     

Sovereign Geopolitics? – Uncovering the “Sovereignty Paradox”

This paper reconsiders the importance of the sovereign state in contemporary geopolitics. The role of the state in an era of globalisation and devolution is a concern that has gained considerable attention in recent geographical scholarship. What has received less attention is how the state has historically functioned as a device that conflated the linked concerns of sovereignty and territoriality. The authors argue that there exist a number of “sovereignty paradoxes” that inhibit the interdisciplinary analysis of the interrelations between sovereignty, territoriality, and state power. Thus, reconsidering sovereignty and territoriality informs both how the state emerged as an important unit of geographical analysis historically, and why the state has become such a problematic concept in contemporary geopolitics. This work has implications for understanding popular struggles over civil liberties, foreign policy, and justice for indigenous peoples.     

The Long‐Term Effects of Legalizing Divorce on Children

We estimate the effect of divorce legalization on the long‐term well‐being of children, by exploiting the different timing of divorce legalization across Europe. We compare the adult outcomes of cohorts raised when divorce was banned with those of cohorts raised after divorce was legalized in the same country. We also have ‘control’ countries where all cohorts were exposed (or not exposed) to legal divorce as children. We find that women who grew up under legal divorce have lower earnings and income and worse health as adults compared with women who grew up under illegal divorce. These negative effects are not found for men.