On the size of government spending multipliers in Europe

This article compares the size of government spending multipliers in Europe by applying a panel structural vector autoregression analysis on 11 eurozone and 8 non-eurozone countries using quarterly data from 1991Q1 to 2012Q4. We find that (i) spending multipliers are smaller in eurozone compared to non-eurozone countries, (ii) across the euro area the impact of government spending on GDP has been higher before than after the introduction of the euro, (iii) spending multipliers are larger in the eurozone periphery than in the core countries and (iv) since the beginning of the recent financial crisis, spending multipliers have become larger both for eurozone and for non-eurozone countries. We relate these results to an emerging theoretical literature linking the size of fiscal multipliers to the monetary policy stance. We also discuss the implications of our findings for the effectiveness of fiscal policy in Europe.     

Factor Demand in Pakistan's Manufacturing Sector

This paper estimate factor demand function by choosing appropriate technology. Departing from the conventioanl parting from the conventional practice of using and capital as factor inputs we extend the list of factors of production by including energy. Since we have more than two factor inputs the two-level (nested) CES production function is the natural choice for the appropriate technology. Using this technology we derive the factor demand for functions and estimate these for Pakistan's manufactruing sector covering a period from 1959-60 to 1982-83. The output elasticity of labour, capital and energy are found to be 0.47, 0.66 respectively. These informations, in particular, the employment elasticity are extremely important for manpower planning. These findings confirm the capital intensive structure of Pakistan's manufacturing units. [200]     

Executive compensation and gender: S&;P 1500 listed firms

We examine if a gender gap persists in executive compensation and if the composition and the determinants of executive compensation for men versus women are the same for the S&P1500 listed firms during the period from 1992 to 2004. This analysis is also extended to high tech firms, where high scholarship is required both for male and female executives. The results reveal that the gender gap in executive compensation is reducing essentially after the year 2000. Also, the factors that explain the variation in executive compensation are not all the same for men and women. However, firms continue to pay women, who are considered more risk averse than men, a similar proportion of risky compensation components, such as stock options and restricted stocks, than they pay to men. In terms of technology firms, we find that the gender differences in total compensation are not statistically significant. Our study offers insight into recent data for executive compensation. The finding that the gender gap diminishes is a sign of a better functioning market for executives. Our findings could be potentially useful for compensation committees in order to develop compensation packages that take into consideration the degree of risk aversion in order to enhance performance. Compensation adjusted for risk aversion can produce a higher level of satisfaction for the employees and can lead to better performances. Future research should focus on international comparison of various dimensions of executive compensation.     

Customer attitudes of stayers and defectors in B2B services: Are they really different?

Identifying attitudinal differences between stayers and defectors is important in establishing a deeper understanding of customer satisfaction and loyalty research. Both managers and academics often use global customer attitudes, such as customer satisfaction and behavioral intentions, as determinants of customer loyalty. The implicit assumption is that customer satisfaction and/or behavioral intentions are valid, and accurate, predictors of actual loyalty behaviors. This study compares customer attitudes of stayers and defectors in B2B services using respondents (primary decision makers) from a Fortune 100 company. The results show that the commonly used customer metrics of service quality, satisfaction, and behavioral intentions have some differences between stayers and defectors. However, these metrics are shown to be relatively weak differentiators of actual customer defection. The stayers and defectors are much more similar, than different, on most metrics. The most notable difference is price perceptions, where defectors appear to be more price sensitive than stayers. These findings have significant implications for the design and use of customer-focused research by managers.     

The economic cost of the Islamic State on the Syrian and Iraqi economies

In this paper, we evaluate the economic cost of the Islamic State on the Syrian and Iraqi economies from 2010 to 2016. To do so, we use the Post-Terrorism Final Economic Damage Simulator—PTFED-Simulator. The PTFED-Simulator assesses the economic damage of terrorism based on ten different indicators: (1) total regional terrorism tension (?T_t); (2) harmonized anti-terrorist strategy (AT₊); (3) war losses from terrorism (?πt); (4) total economic leakage from terrorism (?Ψt); (5) economic desgrowth from terrorism (?δ_t); (6) military dimension of terrorism (MD_t); (7) post-terrorism economic damage (?Π_t); (8) post terrorism economic damage evaluation; (9) post-terrorism reconstruction plan (PTR_t); and (10) terrorism effect on mega-disk networks mapping. Overall, we seek to evaluate the impact of terrorism on economic performance from a multi-dimensional perspective in both the short run and long run.     

Investment shocks and the comovement problem

Recent work based on sticky price-wage estimated dynamic stochastic general equilibrium (DSGE) models suggests investment shocks are the most important drivers of post-World War II US business cycles. Consumption, however, typically falls after an investment shock. This finding sits oddly with the observed business cycle comovement where consumption, along with hours-worked and investment, moves with economic activity. We show that this comovement problem is resolved in an estimated DSGE model when (i) the cost of capital utilization is specified in terms of increased depreciation of capital, as originally proposed by Greenwood et al. (1988) in a neoclassical setting, or (ii) there is no wealth effect on labor supply. The data, however, favors the first channel. Traditionally, the cost of utilization is specified in terms of forgone consumption following Christiano et al. (2005), who studied the effects of monetary policy shocks. The alternative specification we consider has two additional implications relative to the traditional one: (i) it has a substantially better fit with the data and (ii) the contribution of investment shocks to the variance of consumption is over three times larger. The contributions to output, investment, and hours, are also relatively higher, suggesting that these shocks may be quantitatively even more important than previous estimates based on the traditional specification.     

Similarity of differential information with subjective prior beliefs

We present a complete, separable and metrizable topology on the product space of information and (subjective) beliefs. Such a topology formalizes similarity of differential information without the assumption of a common prior, but under the assumption that objectively impossible events are considered impossible by subjective beliefs. As an application to the theory of the consumer, we provide results on the continuity of expected utility and demand functions. We also provide continuity results for the value of information and the insurance premium as defined in the literature.     

Productivity impacts of infrastructure development in Asia

This study investigates the impact of infrastructure capital on total factor productivity in selected Asian countries. The scope of the assessment is broadened by exploring the effect of infrastructure development on sectoral differences in total factor productivity. The study calculated the total factor productivity over the period 2006–2016 for 16 manufacturing industries in 19 Asian countries. Further, the impact of lagged infrastructure and endowment is also explored with an eye toward improving different infrastructural measures. The empirical findings show that lagged infrastructure and endowment exert a positive and significant impact on infrastructural improvement. The impact of telecommunications, road, and power infrastructure on sectoral productivity is investigated by applying the fully modified ordinary least squares estimation technique to control the endogeneity problem associated with infrastructure provision. Overall, the empirical findings show that infrastructure provision, particularly the provision of telecommunications and power, is an important factor for explaining patterns of comparative advantage, whereas the provision of roads is important to explain patterns of absolute advantage. The results further indicate that road infrastructure is more important for low technology-intensive industries, while power infrastructure is crucial for high technology-intensive industries.