Migration and Regional Trade Agreements: A (New) Gravity Estimation

This paper investigates the role of regional trade agreements (RTAs) on bilateral international migration. Building on a gravity model for migration, our econometric strategy controls for the multilateral resistance to migration and solves the zero migration flows problem by using a censored quantile regression approach. Further, the endogeneity problem of RTAs in migration settlement is addressed by using instrumental variable censored quantile regression. Our results suggest that the presence of a RTA stimulates the migration stocks among member countries. The pro‐migration effect of RTAs is magnified if the agreement includes also provisions easing bureaucratic procedures for visa and asylum among member countries. Finally, we find an asymmetric effect of RTAs across the quantiles of the distribution of migration settlements.     

Tracking position premiums in discrete choice experiments

Eye-tracking was used to identify potential location ‘premiums’ in discrete choice experiments for certain positions in the computer screen in terms of increasing the visibility, general interest and attention of respondents. The search dynamics to choose the optimal alternative closely resembled the natural process of reading in a ‘Z’ motion going from left to right and top to bottom. An empirical application of water conservation showed that conservation practices in the production process were not statistically different than zero. On the other hand, respondents are interested in water conservation practices in their landscapes where they benefit directly from the sustainable practice.     

News media analytics in finance: a survey

We survey the works applying text analytics to the study of news media in financial markets beyond intraday horizons, and expand into the fundamental economic theory and concepts relevant to the field. We compare and contrast the news sources, textual analysis methods and empirical modelling approaches adopted within the literature. We distil and categorise the key empirical insights, and summarise the bibliographic history of the literature so far. While this rapidly growing field has yielded many exciting discoveries, there are a number of promising avenues for future research which will only benefit from continued advances in computational technology.     

Regulatory compliance under enforcement gaps

Journal of Regulatory Economics - Analyses in the literature on regulatory enforcement usually assume that regulatory agencies know all of the entities subject to regulation. But constant entry and...     

Do Social Media Tools Impact the Development Phase? An Exploratory Study

Over the past two decades, firms have increasingly adopted information technology (IT) tools and services to improve the new product development (NPD) process. Recently, social media tools and/or tools that include social networking features are being utilized to allow users both inside and outside the organization to easily communicate and collaboratively design, manage, and launch new products and services. Unfortunately, there is little empirical evidence to suggest what influence these new IT tools have on NPD performance. Through a project‐level, exploratory, empirical study, the impact of these new IT tools on the development phase of the NPD process is investigated. We find that the use of these new tools is significantly lower than the adoption of traditional IT tools such as e‐mail and computer‐aided‐design. Traditional tools have a significant, positive impact on NPD outcomes, including team collaboration, the concepts/prototypes generated, and management evaluation. Interestingly, new media tools such as project wikis and shared collaboration spaces also have a significant, positive impact on concepts/prototypes generated, and management evaluation. Surprisingly, social networking tools like weblogs and Twitter negatively impact management evaluation while having no impact on NPD team collaboration and concepts/prototypes generated. These results suggest that social networking tools in their current guise are not helpful to the NPD team and may in fact be distracting to innovation management during the development phase.     

THEORETICAL AND PRACTICAL ARGUMENTS FOR MODELING LABOR SUPPLY AS A CHOICE AMONG LATENT JOBS

Models of labor supply derived from stochastic utility representations and discretized sets of feasible hours of work have gained popularity because they are more practical than the standard approaches based on marginal calculus. In this paper we argue that practicality is not the only feature that can be addressed by means of stochastic choice theory. This theory also offers a powerful framework for developing a more realistic model for labor supply choices, founded on individuals having preferences over jobs and facing restrictions on the choice of jobs and hours of work. We discuss and clarify how this modeling framework deviates from both the conventional discrete approach [Van Soest, A. ( 1995 ) Structural models of family labor supply. A discrete choice approach. Journal of Human Resources 30: 63–88), as well as the standard textbook approach based on marginal calculus (Hausman, J.A. ( 1992 ) The econometrics of nonlinear budget sets. Econometrica 53: 1255–1282]. We furthermore discuss how the model based on job choice can be applied to simulate effects of alternative restrictions on hours of work.     

The Decision to Repurchase Debt

The authors examined the market reaction to announcements of 208 corporate offers to repurchase outstanding debt during the period 1989–1996. In most tender offers, debtholders receive either a fixed price or a fixed spread over a benchmark Treasury security, or a range of prices based on a Dutch Auction. In most cases, management cites as its main motive the desire to reduce leverage and/or interest expense. But such tender offers are also often—in fact, in 70% of cases—accompanied by consent payments intended to induce bondholders to vote to remove covenant restrictions. The authors found that tender offers are wealth‐increasing events, with positive average market reactions of almost 1.5%. But the means of funding has a major impact on the market reaction. Whereas tender offers financed with equity receive a neutral market response, those offers financed with the proceeds from asset sales are associated with equity announcement returns of 3.8%. What's more, shareholders respond positively to the removal of covenants, especially asset sale covenants, with abnormal returns averaging 11% in such cases. Before their offers, companies that tender for their debt tend to have less cash and more long‐term debt than comparable companies, and to have lower operating returns and to trade at a discount to their peers. But after the tender offer, assets increase, operating returns improve, and the tendering firms trade at a premium.