Disaggregating input–output tables in time: the temporal input–output framework

The input–output framework has evolved dramatically since its initial formulation. New analytical techniques and extensions have allowed a more comprehensive assessment of the economy and expanded its applicability. Nonetheless, the core of the framework has remained unchanged: an annually compiled input–output table, which conveys monetary flows between sectors in a region in a particular year. Hence, the technical coefficients derived from it are ‘average’ input compositions, neglecting fluctuations in production capacity, seasonality and temporal shocks within that period. This paper develops a consistent methodology to disaggregate the annual input–output table in its time dimension in order to estimate intra-year input–output matrices with distinct technical structures for a particular year. The main advantages in relation to the annual model are to allow seasonal effects to be studied within the input–output framework, to better understand the process of coefficient change and to offer a more comprehensive dynamic view of production.     

On Consumer Credit Outcomes in the U.S.-Mexico Border Region

The ease in mobility of people across the U.S.-Mexico border region provides a natural setting for analyzing the role of economic interdependency on consumer credit outcomes. Since the U.S. and Mexican economies are not entirely synchronized and have different growth rates, the growing Mexican border economy is likely to increase the consumption of U.S. goods and services in the region, and provide additional job opportunities to the U.S. border residents. Thus, the effect of being located at the border (‘border effect’) might reduce default and bankruptcy in the U.S. However, if both economies are nearly perfectly correlated, then the ‘border effect’ is likely to be insignificant. Our results are consistent with the border effect lowering the rate of bankruptcies and mortgage defaults in the U.S. counties that share a border with Mexico. An increase in the level of economic interdependency, as measured by the differential economic growth between Mexican municipalities and their sister U.S. county, decreases the bankruptcy rates in the U.S. border region. Overall, this research helps understand credit risk issues in the U.S.-Mexico border region.     

The Market for Directors’ and Officers’ Insurance

Directors’ and officers’ (D&O) liability insurance is a commonly used risk management tool for corporations both in the United States and abroad. While prior research has focused on the demand for D&O insurance and its role in corporate governance, there is an absence of literature on the supply side of the D&O market. Using the newly available D&O Insurance Coverage Supplement to insurers’ statutory filings, we develop a more comprehensive understanding of the D&O insurance market and of those firms that write D&O coverage. We develop and estimate a model of the decision to write D&O insurance and the extent of market participation. Our results suggest that there are significant operational and financial differences between firms that supply D&O insurance and those that do not. Several of these differences (specifically, size, diversification, and organizational form) are consistent with the predictions of the managerial discretion hypothesis.     

Product Differentiation with Credence Attributes and Private Labels: The Case of Whitefish in UK Supermarkets

The retail market for seafood is dynamic with substantial competition both amongst retailers and between private labels and national brands. New product attributes are added in attempts to differentiate products and to attract consumers. Credence attributes, in particular those related to eco‐labels and fishing method, have become more common. But little is known about how these and other credence attributes are valued in the retail market. In addition, little is known about price differences between private labels. To estimate the value of these attributes, weekly in‐store observations of selected frozen whitefish products were conducted in seven UK retail chains in the city of Glasgow. An estimated hedonic model shows a substantial price premium for fishing method (line‐caught), a premium for both home (Scottish) and non‐home country of origin (Icelandic) and a premium for the Marine Stewardship Council eco‐label. An uncertified eco‐label owned by a large seafood manufacturer leads to reduced price. The study also reveals substantial price differences between private labels for whitefish. The results contribute new insights regarding opportunities for differentiation by credence attributes which may lead to more sustainable and effective resource use along the value chain for frozen whitefish.     

Child Labor, School Attendance, and Intrahousehold Gender Bias in Brazil

An extensive survey data set of Brazilian households is usedto test whether intrahousehold gender bias affects the decisionsof mothers and fathers to send their sons and daughters to workand to school. An intrahousehold allocation model is examinedin which fathers and mothers may affect the education investmentand the child labor participation of their sons and daughtersdifferently because of differences in parental preferences ordifferences in how additional schooling affects sons' and daughters'acquisition of human capital. Brazilian household survey datafor 1998 are used to estimate the impact of each parent's educationon the labor market participation and school attendance of theirsons and daughters. For labor market participation, the father'seducation has a greater negative impact than the mother's educationon the labor status of sons. The father's education also hasa greater impact on sons' labor status than on daughters'. Forschooling decisions, the mother's education has a greater positiveimpact than the father's education on daughters' school attendance,but fathers have a greater positive impact on sons' school attendancethan on daughters'.     

On portfolio optimization: Imposing the right constraints

We reassess the recent finding that no established portfolio strategy outperforms the naively diversified portfolio, 1/N, by developing a constrained minimum-variance portfolio strategy on a shrinkage theory based framework. Our results show that our constrained minimum-variance portfolio yields significantly lower out-of-sample variances than many established minimum-variance portfolio strategies. Further, we observe that our portfolio strategy achieves higher Sharpe ratios than 1/N, amounting to an average Sharpe ratio increase of 32.5% across our six empirical datasets. We find that our constrained minimum-variance strategy is the only strategy that achieves the goal of improving the Sharpe ratio of 1/N consistently and significantly. At the same time, our developed portfolio strategy achieves a comparatively low turnover and exhibits no excessive short interest.     

Exploring the impact of self‐construal and cultural intelligence on alcohol consumption: implications for social marketing

• There is enormous cross‐cultural variation in alcohol choices and drinking behaviour. Because of the inherent differences in historical drinking culture, as well as differences in alcohol policy globally, similarities and differences in drinking patterns have long been a focus of interest among public health and social marketing researchers. Thus, the purposes of this study are (1) to explore differences between groups (Australian and non‐Australian‐born respondents) on self‐construal, cultural intelligence and alcohol consumption and (2) to investigate the impact of self‐construal and cultural intelligence on alcohol consumption in Australia. Data for this study were collected through a large public university in Australia (N = 669). The paper found that people with interdependent self‐concept were less likely to drink alcohol than people with independent self‐concept and cultural intelligence was not significantly related to hazardous alcohol use, harmful alcohol use and dependence symptoms. Variations between Australian‐born and overseas‐born groups were evident. Limitations of the current study and an agenda for future research are outlined.

Copyright © 2016 John Wiley & Sons, Ltd.     

What Future for the EU in the Global Trading System?

The recent phase of globalisation could be characterised as “wider”, whereas the next phase to come will be “deeper”. This new phase is likely to prove bumpier than the previous one, as the issues now at stake will have more to do with values or ethics, the interpenetration of which will be both economically necessary and politically difficult. In the medium term, the growth of the European economies will become more dependent on external trade, and thus these policy challenges will need to be addressed.     

THE APPLICATION OF THE CONSTANT PRICE METHOD FOR EVALUATING THE TRANSFER RELATED TO INFLATION: THE CASE OF FRENCH HOUSEHOLDS

The constant price method is used here to evaluate transfers related to inflation either between households and other economic agents (essentially enterprises) or among groups of households defined by occupation, age class and so on. The results obtained are only fragmentary due to a lack of many pieces of information. The method requires in fact the splitting up of every value variation into a price component and a size component.
Nevertheless, some interesting results are shown. In recent years, if the total productivity surplus has always been positive, the wealth surplus of households is sometimes positive, sometimes negative. Concerning the distribution of the productivity surplus among household groups, it has not been possible to find significant distortions, other than those which are related to differences in the propensity to save. On the contrary, marked distortions appear in the distribution of the wealth surplus due to wide differences in estate composition and indebtedness level.