Business Cycle Comovement and Labor Market Institutions: An Empirical Investigation

This paper examines the empirical link between labor market institutions and international business cycle synchronization. Using a data panel of 20 OECD countries over the 1964–2003 period, we evaluate how cross‐country labor market heterogeneity affects business cycle comovement. Our estimation strategy controls for a large set of possible factors influencing cross‐country GDP correlation, which allows a comparison of our results with those found in previous studies. We find that bilateral trade, trade similarity, monetary and fiscal convergence, as well as EMU membership lead to more synchronized cycles. Our results show that labor market regulations affect the extent of business cycle synchronization. Disparities in employment protection laws and direct taxation tend to lower international comovement while divergence in union density, unemployment benefits, and indirect taxation enhance cross‐country correlations. The level of labor market regulations also matters. Heavier employment taxes are found to raise GDP comovement.     

On the estimation of the effect of labour participation on fertility

In this paper we consider the estimation of the causal effect of female labour market status (participation and employment) on fertility. We focus on the sensitivity of the estimated effect to (i) the assumptions about the exogeneity of labour market status; and (ii) the time interval between the measurement of fertility and employment status. Using Spanish quarterly data, we estimate a switching probit model that accounts for the joint determination of both variables. In order to obtain a behavioural effect of the former on the latter, we look at the timing of conception instead of the timing of birth, and present alternative sets of estimates depending on the accuracy with which conception is measured (yearly or quarterly). Our results show a positive although non-significant effect of participation and employment on the probability of having the first child, once the sample of women who conceive in the same quarter (or one quarter later) in which labour market status is measured and the endogeneity between both variables is accounted for. We find that annual data tend to over-estimate the negative effect of employment or participation on the probability of having a child, but the main biases appear when looking at the effect of participation. We are grateful to Adrian Kalwij, Daniel Miles and two anonymous referees for helpful comments on this work. All remaining errors are our own.     

Customer satisfaction study via a latent segment model

The aim of this study is to apply a new conceptual model, and a new technique as an approach to the modelling of customers’ satisfaction, and to develop an overall satisfaction index (OSI). This study evaluates customers’ satisfaction of a certain public organization service, and argues that in order to estimate the global customers’ satisfaction measure we must appeal to methodologies recognizing that satisfaction must be understood as a latent variable, quantified through multiple indicators. Thus, it is natural that we consider the latent segment models (LSM) approach to proceed to the evaluation of customer's service satisfaction. As a result of these models estimation, we selected a three latent segment model, that is to say, the latent variable customer satisfaction has three classes: segment 1, with 50.4 percent of the customers, that represents “The Very Satisfied”, for those to whom everything is very well in the organization service; a segment 2, with 33.4 percent of the customers, representative of the “The Well Satisfied”, not totally satisfied with the quality of the organization, and a segment 3, with 16.2 percent of the customers, “Satisfaction Demanders”, thinking that organizational quality can be improved. Finally, we developed an overall satisfaction index which is important to show how the company as a whole is performing.     

Segmenting and Profiling the Portuguese Festival-Goers Through the Most Ancient Form of Music Retailing: The Music Festivals

This article intends to segment and profile the festival-goers in Portugal, and through a mixed mode survey of 657 Portuguese citizens using latent segments models, a three-segment solution was achieved: music lovers, 53%; networkers, 33%; and tourists, 14%. The majority of the festival-goers, the music lovers, consider Optimus Alive the most memorable festival because of the music and these results should be conveniently used for music retailing purposes. The model identified the demographic factors that contributed the most to the solution, and according to each segment, several recommendations to festivals organizations are presented.     

Playing Cournot although they shouldn’t

Summary. In this note, we experimentally investigate the extended game with action commitment in a Cournot duopoly with asymmetric cost. Risk dominance considerations allow to select a unique equilibrium in which the low-cost firm is the Stackelberg leader. The data, however, do not support the theory as simultaneous-move play is modal. Average output choices are in line with the Cournot equilibrium. This suggests that Cournot is a much more robust predictor for competition in markets than theory suggests.Received: 14 October 2002, Revised: 1 December 2003, JEL Classification Numbers: C72, C92, D43. Correspondence to: Hans-Theo Normann     

Economic crisis and benefits of the Internet: differentiated Internet usage by employment status

Using data from the Spanish Survey on Equipment and Use of ICTs in Households for 2007–2011, this paper evaluates the effect of employment status on the diffusion of the Internet among the labor force. We use a bivariate probit with sample selection model to account for a potential selection bias that arises because online usage is only observed for Internet users. Our results show that, controlling for income, employment influences online adoption and usage, and we find evidence of a digital divide in adoption and usage by education and age among the labor force. Employed individuals are more likely to have accessed the Internet and used it more frequently than the unemployed and for different activities. However, conditional on adoption, they do not use the Internet for more personal activities. These findings suggest that firms promote and subsidize Internet access, but this sponsored access does not translate into more personal use.     

R&;D in SMEs: a paradox?

This paper has three objectives: (1) to survey the relevant literature addressing the (apparent) paradox of Research & Development investments carried out within Small and Medium Enterprises; (2) to provide focused summaries of the articles in this special issue; (3) to draw some general conclusions in terms of policy implications.

International Joseph A. Schumpeter Society 10th ISS Conference

Announcement

International Joseph A. Schumpeter Society 10th ISS ConferenceInnovation, Industrial Dynamics and Structural Transformation: Schumpeterian Legacies, Università Bocconi, Milan, 9-12 June 2004