Latin America after the global crisis: the role of export-led and tradable-led growth regimes

Is the ongoing economic slowdown in industrialized countries likely to impact Latin American growth negatively in the medium- to long-run? This paper considers various transmission channels that work through trade in goods and services, and finds econometric evidence suggesting that shrinking global imbalances may create problems for Latin America. Specifically, using panel data analysis, we find that the trade balance as a proportion of GDP is positively associated with Latin American economic growth over the period 1953–2009. We then develop a simple dynamic model to help explain our main finding through investment and saving behaviour.     

How to measure competition in an economy in transition

This paper attempts to find a robust method of measuring competition when firms' operational activities are subject to frictions. The first part theoretically tests the indicative quality of two competition measures, the price‐cost margin (PCM) and the profit elasticity, in a model of monopolistic competition. The second part studies the empirical performance of the indices for a panel of Ukrainian manufacturing firms. This study offers a new approach to measuring profit elasticity that relies on structural estimation of a production function. The estimation methodology retrieves a productivity index that is adjusted to imperfect competition. The proposed method of measuring profit elasticity is found to be robust to frictions, but the PCM and traditional profit elasticity are biased, especially when the intensity of competition is low. Empirical findings show that competition exhibits a significantly positive correlation with aggregate productivity performance, while its impact on firm productivity is nonlinear.     

And if the ball does not cross the line? A comprehensive analysis of football clubs’ performance

The football club market is changing fast in the social media era. In this global market, clubs must maintain or improve fans’ attendance at the stadium; simultaneously, they need, more than ever, to take care of social media. The aim of this article is to test and discuss a comprehensive approach to analysing the performance of football clubs regarding their multiplicity of objectives. We analyse the efficiency of English Premier League (EPL) clubs during three seasons (2012/13–2014/15). The methodologies employed are data envelopment analysis (DEA) and a bootstrapped DEA model. The input is the market value of the squad, and the outputs are sports results, total revenue, the ratio of stadium utilization during the season and an index of social media impact. The results are robust to alternative estimation methods and indicate that EPL clubs still have a margin for improving their overall efficiency, mainly the medium clubs. The analysis of football clubs’ performance with the proposed comprehensive approach provides a useful tool to help managers with evaluation and feedback considering the actual context of the market. The approach brings closer the opportunity to design appropriate strategies to improve clubs’ efficiency as well as competition policies.     

Monetary policy regime change and regional inflation dynamics: looking through the lens of sector‐level data for Korea

This paper explores the impact of the adoption of inflation targeting (IT) on the dynamics of city‐level inflation in Korea using both aggregate and sector‐level data. When looking at aggregate regional inflation, we find that the mean, volatility and persistence fell in all cities in the wake of the monetary policy regime change, consistent with other evidence in the literature. Delving more deeply into the disaggregate data reveals additional insights however. For most of the changes we observe in the dynamics of regional inflation, we find that the aggregate effects are being driven primarily by sectors that fall into the ‘Services’ category. We posit that the impact of better anchored inflationary expectations is primarily on the less‐traded services sectors of the economy, where the domestic monetary policy framework has a relatively larger influence. When it comes to the increased co‐movement observed across regions under an IT regime, however, it is the ‘Commodities’ sectors rather than ‘Services’ that are responsible, probably because services inflation becomes relatively more influenced by local factors once it has stabilized within the target range. Therefore, adoption of IT may not necessarily increase all measures of regional synchronization even when the goal of better‐anchored inflationary expectations is achieved.     

IMMIGRANT RELATIVE WAGES AT THE GREAT RECESSION: EVIDENCE WITH MATCHED EMPLOYER‐EMPLOYEE DATA FOR SPAIN

The article examines relative wages of immigrants in Spain, with a particular focus on the impact of the Great Recession. The empirical analysis is restricted to men and is based on matched employer‐employee microdata and the decomposition techniques of Juhn et al. (1991, 1993) and Fortin et al. (2011). Our results show that the significant native‐immigrant wage gap that exists both in terms of average wages and of differentials along the wage distribution is essentially explained by differences in the endowments of observed characteristics so that, in general, immigrants tend to receive a similar wage treatment than Spaniards with analogous observed attributes. On the other hand, the Great Recession has had a noticeable impact on the relative wages of immigrants, given that the significant increase of the native‐immigrant wage gap observed during the previous expansionary period was mitigated during the economic downturn due to composition effects arising from the severe employment destruction pattern.     

Which factors improve the performance of the internationalization process? Focus on family firms

This study aimed to analyse the impact that the financial features and characteristics of the ownership structures of international companies exert on the performance of their internationalization process, as perceived by managers, and attempted to detect differences between family firms (FF) and nonfamily firms (non-FF). In addition, the impact of these characteristics and others related to FF, such as family ownership and generation, on the perceived performance of their internationalization is analysed. Based on a sample of Spanish companies with direct investment in China, the results indicated that, from the managers’ perspective, being an FF and having lower financial leverage exerted a positive effect on the performance of the internationalization process. Moreover, the study proved that this performance was strongly and positively related to the financial results of the company, and this positive effect was even stronger in the case of FF. Finally, the findings also showed that FF with a higher involvement of the family in their ownership recognized a better performance of their internationalization process. These results will be useful for companies that are considering the value of internationalization as a strategy to improve or maintain their financial results, and they also highlight certain differences between FF and non-FF.     

Capital in the Twenty-First Century: Reinterpreting the fundamental contradiction of capitalism

At a theoretical level this article discusses Piketty’s hypothesis that the distribution of income and wealth tends to become more concentrated over time when the rate of return on capital is greater than the growth rate of real output. We develop a post Keynesian model of growth and distribution showing that once capital is differentiated from wealth, the increase in income and wealth concentration actually occurs when the rate of valorization of financial and real estate assets is greater than the growth rate of real output, and that this situation may be triggered by financial liberalization.     

Real exchange rate and export performance in Argentina, 2002–2008

Between 2002 and 2008, Argentina experienced a phase of very high and sustained economic growth. During this period, macroeconomic policy aimed to preserve a stable and competitive real exchange rate (SCRER). There is controversy on whether the SCRER policy was a key factor fostering growth and, even more, on whether it helped promote the expansion of tradable activities and exports. We use a methodology to detect episodes of export surges among Argentina’s export industries and find that labor-intensive industries—especially low- and medium-technology manufactures—experienced the highest proportion of export surges within this period. We also find that between 1980 and 2015, the highest proportion of surges in total exports occurred during the 2003–8 period. The performance of export of services was also particularly dynamic during this period. This evidence suggests that the SCRER policy was instrumental for export surges in Argentina during 2002–8.     

Islamic Economics in the Late Ottoman Empire: Menâpirzâde Nuri Bey's Mebâhis-i İlm-i Servet

The existing literature on Islamic economics suggests that Islamic economics is a twentieth-century phenomenon with its roots in medieval Islamic intellectual and theological history, thereby leaving a centuries-long gap in the history of Islamic economic thinking. This study aims at taking a first step towards filling this gap by examining a nineteenth-century example of Islamic economics in late Ottoman economic literature. Suggesting a broader definition of Islamic economics, this article investigates a prominent Ottoman intellectual's efforts to define, reveal, and revive a tradition of Islamic economics in historical and intellectual context.     

The price of broadband quality: tracking the changing valuation of service characteristics

This paper investigates how retail broadband prices, choice and quality are changing over time. Using a data set containing daily observations of plans offered in Ireland from 2007 to 2013, this paper applies hedonic modelling techniques to observe the changing pricing of service characteristics. Although we find that average nominal prices remain static throughout our sample period, quality of service has risen dramatically over time, particularly with respect to download speed. Some characteristics of broadband plans exhibit broadly stable valuations over time, but the elasticity of price with respect to advertised download speed and the premium on bundled services declined for most types of broadband plans during the sample period. In addition, the retail price premium enjoyed by the incumbent operator fell significantly since 2007.