Trade networks and economic fluctuations in Asian countries

The paper presents a new methodology, based on tensor decomposition, to map dynamic trade networks and to assess its strength in forecasting economic fluctuations at different periods of time in Asia. Using the monthly merchandise import and export data across 33 Asian economies, together with the US, EU and UK, we detect the community structure of the evolving network and we identify clusters and central nodes inside each of them. Our findings show that data are well represented by two communities, in which People's Republic of China and Japan play the major role. We then analyze the synchronisation between GDP growth and trade. Furthermore we apply our model to the prediction of economic fluctuations. Our findings show that the model leads to an increase in predictive accuracy, as higher order interactions between countries are taken into account.     

Obstacles and solutions on the ladder of citizen participation: a systematic review

This article presents a systematic review of the English-language empirical literature about citizen participation to identify the obstacles to its implementation and the most successful ways to address them. Three sets of variables seem to impact effectiveness: contextual factors, including information asymmetries and public officials’ attitude; organizational arrangements, including community representation criteria and process design; and process management patterns, including group dynamics and collaboration quality. Two recommendations stem from our analysis: internalize decisions in organizational procedures, and establish ongoing interactions between government bodies and their stakeholders. We conclude that half-hearted engagement is unlikely to lead to successful citizen participation.     

Regression density estimation using smooth adaptive Gaussian mixtures

We model a regression density flexibly so that at each value of the covariates the density is a mixture of normals with the means, variances and mixture probabilities of the components changing smoothly as a function of the covariates. The model extends the existing models in two important ways. First, the components are allowed to be heteroscedastic regressions as the standard model with homoscedastic regressions can give a poor fit to heteroscedastic data, especially when the number of covariates is large. Furthermore, we typically need fewer components, which makes it easier to interpret the model and speeds up the computation. The second main extension is to introduce a novel variable selection prior into all the components of the model. The variable selection prior acts as a self-adjusting mechanism that prevents overfitting and makes it feasible to fit flexible high-dimensional surfaces. We use Bayesian inference and Markov Chain Monte Carlo methods to estimate the model. Simulated and real examples are used to show that the full generality of our model is required to fit a large class of densities, but also that special cases of the general model are interesting models for economic data.     

Panel data and descriptor for energy econometrics – an efficiency,resilience and innovation analysis

Quality & Quantity - The work at hand presents a new extensive panel dataset for energy economics, econometrics and policy. The referred dataset is made of 5000 observations circa, including 6...     

The dimensional assessment of personality in drug addicts: a mixed-effects Rasch model approach

Drug abuse results from a series of different factors, such as social and family issues. Subjects more vulnerable to develop an addiction are, for instance, people living in high-stress environments who may resort to addiction in order to cope with their circumstances, such as demanding jobs, family crisis or other situations or people living in low-income households where violence occurs, who may be triggered into addiction as a way to escape negative emotions or ignore any underlying problems or issues. Psychometric research in the field of drug dependence has focused on identifying certain personality characteristics. It is now generally agreed that personality may influence, precipitate or perpetuate substance abuse. The aim of this paper is to perform a dimensional assessment of personality in a sample of drug addicts. To better understand the complexity of addictive behaviours of substance-using individuals, the Cloninger’s temperament and character inventory test is employed while the item response data analysis is performed by mixed-effects Rasch models. These models combine the advantages both of Rasch measurement framework for latent variables and of models with hierarchical data. To evaluate the differences in dimensions of temperament and character inventory test in subjects with drug addiction, we fit and compare a sequence of mixed-effects Rasch models. Results from models fitting are compared and discussed for a data set of 84 participants.     

R&D competition, absorptive capacity, and market shares

This paper deals with an oligopolistic industry where firms are engaged in cost-reducting R&D activity to maximize their market shares. The existence and uniqueness of a feedback-Nash-optimal R&D strategy for each firm are discussed. Our simulations highlight that variations in spillovers hardly influence the firms' R&D investment, if their absorptive capacities to exploit extramural knowledge depend on their R&D efforts. Moreover, extramural knowledge cannot completely replace in-house R&D. However, a high level of public R&D favors the firm with the most restrictive R&D expenditure constraint and/or with the lowest initial R&D stock, provided it invests in R&D.     

On the nonexistence of recursive equilibrium in stochastic OLG economies

We study a class of stochastic Overlapping generations (OLG) economies that have one-memory equilibria, that is equilibria that are determined by the current and past realizations of the states of uncertainty. This class is negligible, but important. In particular, it contains all the known examples of nonexistence of recursive equilibrium. We show that, within this restricted domain, the existence of recursive equilibrium is actually typical, and such examples are therefore nonrobust. We thank Felix Kubler, Herakles Polemarchakis and Steve Spear for many useful discussions. This paper was started while the first author was visiting Columbia Business School.     

Heckscher–Ohlin and agglomeration

We argue that embedding endowment-based comparative advantage within a standard NEG framework helps solve the indeterminacy due to multiple equilibria and the ambiguity concerning the relation between integration and specialisation (monotonicity versus non-monotonicity) typical of the NEG literature. In particular, we show that if endowments are in the FPE set, the process of trade integration involves an overshooting of international specialisation and relative factor prices with respect to the free trade level determined by factor abundance. In contrast, if endowments are outside the FPE set, then, even in the presence of agglomeration forces, specialisation and factor prices are monotonically related to trade costs, as implied by the standard trade theory. We argue that the model can shed light on some puzzling stylised facts.     

Eco‐labelling by a for‐profit certifier: Countervailing power and its consequences

For‐profit certifier's eco‐labelling is common in industries where firms have some “countervailing power” on sharing gains from labelling. We show that the certification standard for an environmental quality is lowered when firms have strong “power.” A certifier with too low bargaining power will prefer to sell to the best offer rather than bargain. This switch in the selling mechanism also thwarts his incentives in setting the standard. This is consequential for evaluating policies. The dimensions and even signs of welfare changes induced by taxes and subsidies depend upon the mechanism used, and ultimately upon firms’ countervailing power.     

Trust,risk and time preferences: evidence from survey data

The paper shows that time preferences and risk preferences are key covariates of self-reported trust. They both predict negatively a measure of generalized trust; however, risk aversion is positively correlated with an index of particularized trusting behaviour (which refers to the circle of known people).