Determinants of International R&D Outsourcing: The Role of Trade

This paper investigates the determinants of international R&D outsourcing, in particular the role of trade. We sketch a monopolistic competition model with heterogeneous firms where outsourcing increases a firm's fixed transaction costs as well as its productivity. Financial constraints affect the decision to outsource R&D more to nonexporters than to exporters. In contrast, exporters are more sensitive to a lack of information because they have higher losses when there is technology leakage. We test these predictions using a panel database of Spanish companies. The results highlight the relevance of information in competitive markets, and the role of trade to induce companies to engage in other globalization strategies.     

The economics of education and policy: Ideas for a principles course

There are many aspects of the “economics of education” that would make excellent examples for introductory economics students. The author presents two topics that are central to the economics of education and to human capital theory: the economic benefit (or “returns”) to schooling and educational attainment as an investment. There are two key concepts the author hopes students get from this discussion. The first is that there are both private and social benefits of schooling whence we derive the rationale for government intervention. The second is that educational attainment is an investment decision with both costs and benefits, and some risk.     

The impact of imports on price-cost margins: An empirical illustration

This article decomposes the impact of imports on domestic price-cost margins into separate price and cost effects. Using data from 24 food-processing industries, the empirical results show that although the direct impact of imports on prices is always negative, a positive net impact on price-cost margins occurs in industries characterized by low own-price elasticity of demand and diseconomies of scale. Further results show that the disciplining effect of imports is more preponderant the lower the degree of domestic competition. First version received: September 2000/Final version received: March 2002 RID="*" ID="*"  Professor and Associate Professor, respectively, in their respective departments. They can be reached at rigoberto.lopez@uconn.edu or elena.lopez@uah.es. The authors are grateful to two anonymous referees for their fruitful and helpful comments. Financial support provided by the USDA CSREES special grant No. 00-34178-9036 and by the Cátedras del Banco Santander Central Hispano-Universidad de Alcalá. This is Scientific Contribution No. 1794 of the Storrs Agricultural Experiment Station. RID="*" ID="*"  Professor and Associate Professor, respectively, in their respective departments. They can be reached at rigoberto.lopez@uconn.edu or elena.lopez@uah.es. The authors are grateful to two anonymous referees for their fruitful and helpful comments. Financial support provided by the USDA CSREES special grant No. 00-34178-9036 and by the Cátedras del Banco Santander Central Hispano-Universidad de Alcalá. This is Scientific Contribution No. 1794 of the Storrs Agricultural Experiment Station.     

Economic feasibility analysis for electrical generation from biogas in waste disposal sites in Mexico City

This article highlights the main aspects related to energy generation from biogas in a controlled landfill of Mexico City in order to determine profits and environmental benefits. The designed structures and public policies to provide waste management services in Mexico City have been exceeded. A significant increase in demand has led the government of Mexico City to base public services on rudimentary techniques using obsolete equipment. The modernization of waste disposal facilities and the diversification of services linked to waste treatment can offer several business opportunities to optimize energy generation from solid wastes. The use of landfills to dispose large amounts of waste enables the energy generation from biogas. The energy generated can diversify the electricity market and provide economic benefits to landfills managers to cover operational costs.     

The future of food production – a text-mining approach

ABSTRACT

The system of food production is facing grand challenges, such as a rising population, climate change, degrading bio-productivity of agricultural land and over-fishing. Agriculture and food production are becoming more innovative and implement new infrastructure, IT-platforms or biotechnologies, like gene editing or synthetic food production. A more advanced knowledge base about food innovations helps customers to build informed opinions of new technologies and provides policy makers and industry actors with better information for strategic decision-making. As the amount of available information exceeds expert knowledge or manual filtering of data outputs, this paper presents a text mining study on science and technology in food production based on more than 30 million documents. The proposed methodology which we demonstrate on the example of the future of food production can be applied each time new data becomes available and can serve as an early warning system for a changing technology landscape.     

Macroeconomic determinants of remittances: evidence from Romania

Given the globalization of the labour market and the promotion of free movement for work, young people are looking for employment opportunities from at least two perspectives – professional careers and socio-economic benefits from employment. In developing countries, such as Romania, the labour market is less attractive, which has led to profound, numerical and structural imbalances, due to external mobility for work. Both new generations of graduates and young people aged up to 40 years, decide to work abroad as a more beneficial individual solution, i.e. remittances. The purpose of this paper is to examine the macroeconomic determinants of remittances to Romania, in order to substantiate public policies on diaspora, to adjust employment policy on the national labour market by promoting incentives to create decent, youth-friendly jobs. Using panel data model we selected several variables with potential influence on remittances level. The results demonstrate that traditional influence’s factors as distance, migration routes diaspora concentration or unemployment rate are, at present, less important than wage gap or tax rate at least for developing origin countries.     

Who justifies attacks on civilians? Analysis of attitudes toward terrorism based on value surveys

What are the common characteristics among individuals who justify attacks on civilians? Using nationally representative Gallup World Poll surveys of 30,787 individuals from 27 developing countries in different parts of the world, this paper identifies the partial correlates of extremism. The results suggest that the typical extremist who supports attacks on civilians is more likely to be young, unemployed, and struggling to make ends meet, relatively uneducated, and not as religious as others, but more willing to sacrifice own life for his or her beliefs. Gender and marital status are not found to explain the individual‐level variation in attitudes toward extremism. These results are robust to various sensitivity analyses, although some of them vary in magnitude and significance across countries and geographic regions.     

Work‐Related Migration and Poverty Reduction in Nepal

Using two rounds of nationally representative household survey data in this study, we measure the impact on poverty in Nepal of local and international migration for work. We apply an instrumental variables approach to deal with nonrandom selection of migrants and simulate various scenarios for the different levels of migration comparing observed and counterfactual household expenditure distribution. Our results indicate that one‐fifth of the poverty reduction in Nepal occurring between 1995 and 2004 can be attributed to higher levels of work‐related migration and remittances sent home. We also show that while the increase in international work‐related migration was the leading cause of this poverty reduction, domestic migration also played an important role. Our findings demonstrate that strategies for economic growth and poverty reduction in Nepal should consider aspects of the dynamics of domestic and international migration.     

The impact of the bird flu on public willingness to pay for the protection of migratory birds

In this paper, we present the results of a unique time series analysis of contingent values and models for migratory bird protection based on an identical contingent valuation (CV) survey carried out over a three year time period since the first bird flu outbreak in 2003. Although there exists no scientific evidence for a direct relationship, migratory birds are believed to play an important role in spreading the bird flu virus worldwide. The time series analysis allows us to test the temporal stability of stated preferences for migratory bird protection and at the same time examine indirectly the possible impact of increased media attention and public awareness levels regarding the bird flu. We test the impact of the bird flu on public willingness to pay (WTP) for migratory bird protection in the final 2005 survey whilst accounting for procedural variance introduced by sequencing and question ordering-effects, but we are unable to demonstrate a direct negative relationship. A novelty of the study presented here is that respondents in the CV surveys are given the opportunity to pay an annual money amount or a one-time-off lump-sum. Annual WTP values appear to be significantly higher than one-time-off WTP values, suggesting a negative implicit discount rate. Self-selection bias is an important reason for the observed differences. We find that respondents who agree to pay annually differ significantly from respondents who wish to pay a lump-sum in terms of their underlying preferences and motivations towards migratory bird protection.     

Assessing and predicting financial vulnerability of Italian households: a micro-macro approach

In this study we develop a micro-founded model to analyse the economic-financial conditions of Italian households. Using household level data, we build an indicator to identify vulnerable households based on their budget constraint and the composition of their financial portfolio. Then, we calculate the impact of the predicted trends of macroeconomic variables on the indicator in order to monitor its evolution in the short term (2015–2017). The empirical analysis is based on the Survey of Household Income and Wealth of the Bank of Italy and on a set of macroeconomic forecasts. Our findings suggest that the macroeconomic scenario for the period 2015–2017 implies a progressive reduction in the percentage of vulnerable households for the full extent of the projection.