What accounts for the Chilean saving 'miracle'?

This paper examines the recent saving performance of the Chileaneconomy in the light of its long-run (1940–96) trends.The first conclusion that can be derived from the data is thatmost of the increase in private saving since the mid-1980s isdue to business saving. Household saving turns out to be a stationaryvariable with zero mean. Since business saving has a unit root,households do not seem to take the saving of firms into accountwhen making their own saving decisions. Within the theoreticalframework of a model of business investment with liquidity constraints,we estimate a VAR for business saving, private investment, publicsaving and foreign saving (the current account deficit). Weare able to determine that business saving is unaffected bypublic saving, but that, in the long run, foreign saving andbusiness saving are perfect substitutes. Private investment,business saving and foreign saving are jointly determined. Thepolicy conclusions are that policies that stimulate investmentare likely to lead to an increase in private saving, that policiesaimed at raising household saving will be ineffective, and thatincreases in public saving are very powerful for increasingdomestic saving in the long run.     

Implementation of EEC consumer protection directives in Spain

The paper informs about the state of Spanish law before and after Spain's entry into the European Community. Spanish law already included consumer protection in its constitution as well as an ambitious, yet defective, Act on Consumer Protection (LGDCU). After entry into the EEC, Spain had to adapt Community directives on consumer protection to the Spanish legal order. However, as the author demonstrates in detail, this process has been slow, complicated, and in many areas incomplete or even against Community obligations. The balance sheet of Spanish consumer policy after the completion of the Internal Market may be said to be negative. The principle of subsidiarity may allow for a renewal of consumer policy by strengthening national initiatives.

---

Die Umsetzung der EG-Richtlinien zur Verbraucherpolitik in Spanien

Zusammenfassung Der Beitrag berichtet über den Stand des spanischen Verbraucherschutzrechtes vor und nach Eintritt Spaniens in die Europäische Gemeinschaft. Vor Eintritt hatte Spanien weitgehende Verbraucherschutzvorschriften in seine Verfassung und in das allgemeine Verbraucherschutzgesetz von 1984 aufgenommen, die umfassende Ziele enthielten, welche allerdings rechtstechnisch mangelhaft formuliert waren. Mit dem Eintritt Spaniens in die Gemeinschaft übernahm es die Verpflichtungen aus den relevanten Verbraucherschutzdirektiven. Ihre Umsetzung ging jedoch zögerlich und mit erheblichen zeitlichen Verlusten einher. Einige Richtlinien sind bislang noch nicht fristgerecht umgesetzt worden. Insgesamt zeichnet der Autor ein eher kritisches Bild vom Stand des spanischen Verbraucherschutzrechtes nach Eintritt in die EG. Das Subsidiaritätsprinzip könnte zu einer Wiederbelebung nationaler Initiativen führen.

     

Cofinanced Public Extension in Nicaragua

How effective is agricultural extension? Is it worth the vastsums governments spend to provide it, mostly as a free service,to farmers worldwide? Relatively few studies exist that measureand compare the benefits of extension activities against theircosts. In the absence of such data, this pilot activity concentratedinstead on demand. Would demand for extension services be highif they were no longer free? The existence of solid demand wouldpresuppose some benefits from the service. Further, might chargingfor the service actually improve its quality and sustainability? The pilot program in Nicaragua described here set out to testwhether a truly demand—driven extension system aimed atfarmers with small-and medium-size holdings could be developed.The principal mechanism was a contribution by the farmer paidas a bonus to the extensionist: the aim was to introduce incentivesfor providers to improve the service through rewards linkedto the quality of their work and to establish direct accountabilityof extensionist to client. The outcomes showed that the cofinancingconcept can be successful. The article describes the design,implementation, and results in the expectation that the lessonslearned may be of interest elsewhere.      

Performance Schweizerischer Anlagestiftungen

Ohne Zusammenfassung     

Least squares fitting of an affine function and strength of association for interval-valued data

The ultimate goal of this paper is to determine a measure of the degree of dependence between two interval-valued random sets, when the dependence is intended in the sense of an affine function relating these random elements. For this purpose, a general study on the least squares fitting of an affine function for interval-valued data is first carried out, where the least squares method we will present considers that squared residuals are based on a generalized metric on the space of nonempty compact intervals, and output and input random mechanisms are modelled by means of convex compact random sets. For the general case of nondegenerate convex compact random sets, solutions are presented in an algorithmic way, and the few cases leading to nonunique solutions are characterized. On the basis of this regression study we later introduce and analyze a well-defined determination coefficient of two interval-valued random sets, which will allow us to quantify the strength of association between them, and an algorithm for the computation of the coefficient has been also designed. Finally, a real-life example illustrates the study developed in the paper.  The research in this paper has been partially supported by DGESIC Grants DGE-99-PB98-1534 and DGE-98-PB97-1282 of the Spanish MEC. Their financial support is gratefully acknowledged. Acknowledgements. The authors are deeply grateful to Professor Wolfgang N?ther from the University of Freiberg and their colleagues Professors Norberto Corral, Miguel López-Dı′az and Ignacio MartVnez for their valuable comments and suggestions in connection with this paper. The real-life data which illustrate the study in this paper have been supplied by Aurora Fonseca, Head of the Servicio de Nefrologı′a, and Miguel de Zárraga, General Medical Manager, from the Hospital Valle del Nalón de Langreo in Asturias; we want to thank them sincerely for their collaboration and support.     

The Effect of Earnings Management on the Asymmetric Timeliness of Earnings

Abstract:   Is earnings management affecting (driving) the measures of earnings conservatism? Ball et al. (2000) point out that the asymmetry in the recognition of good and bad news in earnings (faster recognition of bad news: earnings conservatism) is more pronounced in common‐law than in code‐law based accounting regimes. However, comparative studies on earnings conservatism in Europe have failed to identify significant differences between common‐law and code‐law based countries. We argue that in code‐law based countries managers have incentives to reduce earnings consistently. This enhances the association between earnings and returns in bad news periods. We find that after controlling for discretionary accruals, the differential earnings response to bad news in Germany and France decreases significantly.     

Determinants of Export Diversification Around the World: 1962–2000

Using a large dataset for 79 countries covering the period 1962–2000, this study analyses the main determinants of export diversification (concentration). We explore the role of several factors and we use three different indicators of export concentration. We find robust evidence across specifications and indicators that trade openness induces higher specialisation. In contrast, financial development does not seem to help countries to diversify their exports. Looking at the effects of exchange rates, in some of the results, a negative effect of real exchange rate volatility on export diversification is detected, but no significant effects of exchange rate overvaluation. There is also evidence that human capital accumulation contributes positively to diversify exports and that increasing remoteness tends to reduce export diversification. We also explore the role of terms of trade shocks. Most of the results suggest an interesting interaction between this variable and human capital: improvements in the terms of trade tend to concentrate exports, but this effect is lower for those countries with higher levels of human capital. This evidence suggests that countries with higher education can take advantage of positive terms of trade shocks to increase export diversification.     

Testing Conditional Asset Pricing Models Using a Markov Chain Monte Carlo Approach

We use Markov Chain Monte Carlo (MCMC) methods for the parameter estimation and the testing of conditional asset pricing models. In contrast to traditional approaches, it is truly conditional because the assumption that time variation in betas is driven by a set of conditioning variables is not necessary. Moreover, the approach has exact finite sample properties and accounts for errors‐in‐variables. Using S&P 500 panel data, we analyse the empirical performance of the CAPM and the Fama and French (1993) three‐factor model. We find that time‐variation of betas in the CAPM and the time variation of the coefficients for the size factor (SMB) and the distress factor (HML) in the three‐factor model improve the empirical performance. Therefore, our findings are consistent with time variation of firm‐specific exposure to market risk, systematic credit risk and systematic size effects. However, a Bayesian model comparison trading off goodness of fit and model complexity indicates that the conditional CAPM performs best, followed by the conditional three‐factor model, the unconditional CAPM, and the unconditional three‐factor model.     

Reliability of individual valuations of public and private goods: Choice consistency, response time, and preference refinement

We examined the reliability of a large set of paired comparison value judgments involving public goods, private goods, and sums of money. As respondents progressed through a random sequence of paired choices they were each given, their response time decreased and they became more consistent, apparently fine-tuning their responses, suggesting that respondents tend to begin a hypothetical value exercise with relatively imprecise preferences and that experience in expressing preference helps reduce that imprecision. Reliability was greater for private than for public good choices, and greater for choices between a good and a monetary amount than for choices between two goods. However, the reliability for public good choices was only slightly lower than for the private goods.