Environmental impact of household activity in Spain

The objective of this paper is to analyse the environmental impacts of the Spanish economy by way of water and atmospheric pollution on the basis of a Spanish Accounting Matrix for 1999. Only households were taken as an exogenous account. The pollution measures are estimated for seven categories of pollution: three atmospheric pollutants (CO₂, NO_x and SO_x) and four indicators for water (waste water, nitrogen, metals and biological oxygen demand (BOD)). The environmental data base was obtained from the Spanish Statistical Institute.The analysis reveals that pollution in Spain is closely linked to food production, energy, extractive industries and paper manufacturing. We show that services, taken as a whole, are major polluters, though this is due to the volume of household expenditure they represent rather than their pollution potential as such. We also show that the Spanish economy avoids a great deal of pollution by importing inputs, which pollute where they are produced. Finally, the study also provides per capita pollution values for the aforementioned seven pollutants.     

Social protection during recessions: evidence from Chile

This article analyzes the main labor market risk management strategies adopted by the Chilean Government during the 1999 recession that was initially related to the Asian financial crisis. Their successes and failures can suggest innovative social protection solutions for other countries. It seems that the 1999–2001 labor reforms and a three-year plan to increase the minimum wage intensified the recession’s effects on unemployment. Probit models indicate that households coped with the recession’s effects by increasing wives’ labor supply but not by withdrawing children from schools. The expansion of employment programs probably helped households to adopt these coping strategies.     

Measuring long-run marketing effects and their implications for long-run marketing decisions

This paper discusses the role of agents’ beliefs and their implications for the economic modeling of their behavior, in particular, their behavior over time. The paper also discusses the corresponding planning problems facing both firms and consumers in their current decision making. After a general discussion of the consumer and firm problem, we discuss recent examples of some of the emerging empirical literature on dynamic choice behavior in marketing.     

Harvesting Preemption, Industrial Concentration and Enclosure of National Marine Fisheries

This paper explores how harvesting technology can affect firms' internalisation of common pool externalities and the incentives for expanding firm's size. Focusing on supply side non-pecuniary externalities, our closed-entry harvesting competition model suggests that when marginal harvesting costs are weakly sensitive to common pool externalities, atomistic competition is likely to remain, other things equal, as the predominant industrial structure in the fishery. The avenue for increasing industrial concentration is modelled via Stackelberg leadership which offers the option of preempting rivals' production. In our static modelling, a fishery subject to Stackelberg signalling results in higher overfishing versus the case of a highly decentralised harvesting sector (proxied by the use of Nash conjectures). Given that static optimising behaviour could be interpreted as a result of entry controls and other fishing regulations being widely perceived as ineffective controls, the obtained overfishing ranking suggests that in fisheries where strategic preemption in production is feasible, but where entry controls and other important regulations on fishing effort are considered to be ineffective, overfishing is likely to remain the predominant outcome, even if other incentives promote evolution towards a more concentrated industry structure. When the fishery is already overpopulated by numerous small firms, whatever advantages large firms may have in terms of profitability, numerous small-scale fishermen tend to make up for in the political arena. This imposes constraints on the politically feasible fishing regulations. We use a second best welfare benchmark to illustrate resulting policy trade-offs.     

Quantifying private benefits of control from a structural model of block trades

We study the determinants of private benefits of control in negotiated block transactions. We estimate the block pricing model in Burkart, Gromb and Panunzi (2000) explicitly accounting for both block premiums and block discounts in the data. The evidence suggests that the occurrence of a block premium or discount depends on the controlling block holder's ability to fight a potential tender offer for the target's stock. We find evidence of large private benefits of control and of associated deadweight losses, but also of value creation by controlling shareholders. Finally, we provide evidence consistent with Jensen's free cash flow hypothesis.     

Property rights and long-run capital

Proprietary capital falling into the public domain inefficiently decreases capital accumulation. As a consequence, the market steady state consumption underperforms the planner's by 4.6%–9.1% in a neoclassical infinitely-lived agents economy with constant returns to scale and standard empirically supported parameters. The results extend robustly to an overlapping generations economy, for which the gap is 10.5% when similarly parametrized. A policy decentralizing, in the latter, the planner's steady state instead consists of (i) subsidizing the rental rate of private capital at its depreciation rate, and (ii) taxing households' negative net position between, on the one hand, firm and depreciated capital ownership, and on the other, borrowing. Under this policy, the necessary tax rate on households' negative net position is smaller the bigger the absolute value of the latter and, hence, the bigger the corresponding monetary real balances held by households.     

Optimal Time Interval Selection in Long-Run Correlation Estimation

This paper presents an asymptotically optimal time interval selection criterion for the long-run correlation block estimator (Bartlett kernel estimator) based on the Newey–West and Andrews–Monahan approaches. An alignment criterion that enhances finite-sample performance is also proposed. The procedure offers an optimal alternative to the customary practice in finance and economics of heuristically or arbitrarily choosing time intervals or lags in correlation studies. A Monte Carlo experiment using parameters derived from Dow Jones returns data confirms that the procedure can be MSE-superior to alternatives such as aggregation over arbitrary time intervals, parametric VAR, and Newey–West covariance matrix estimation with automatic lag selection.