A regional perspective on inequality and growth in Portugal using panel cointegration analysis

This paper examines the relationship between inequality and economic growth for thirty Portuguese NUTS3 regions within a multivariate panel framework over the period 1995–2007, using panel cointegration techniques to test for the existence of a relationship between inequality and real GDP per capita. The results point to the existence of a relationship between the variables, where the effect of inequality, measured as the Gini index of the earnings distribution, on per capita output is negative. This negative influence seems to be determined by the behaviour of the bottom of the earnings distribution, most likely by dampening investment in human capital, with the results pointing to the coexistence of a positive impact of inequality at the top of the distribution, supporting the incentives argument for the inequality-growth nexus. Additionally, the results confirm the predicted positive relationship between human capital and output, lending support to both the exogenous and endogenous growth models predictions on the importance of human capital for production both as an input in the production of final goods and in the production of technology. Another interesting result concerns structural funds: we found a negative relation of this variable with regional output. We believe that EU structural funds were a source of Dutch disease for Portugal, which resulted mainly in a lack of external competitiveness of the Portuguese economy due to the excessive specialization in non-tradable goods made possible by the European funds.     

College Attainment of Women

Up to the late 1970's the Sex College Attainment Ratio (SCAR), or ratio of college attainment between men and women, was about 1.6. Assortative mating within education groups in marriages is strong enough in the United States to prevent accounting for the SCAR feature based on males' higher earnings. We document the puzzling nature of the SCAR, and we explore various theories to account for it. Our main finding is that if parents' well-being is affected by the number of grandchildren, gender differences in the steepness of the negative relation between educational attainment and number of children provides the best theory to understand the SCAR. Journal of Economic Literature Classification Numbers: J12, J16, I20.     

Collective bargaining and regional wage differences in Spain: an empirical analysis

This article analyses the importance of labour market institutions and, in particular, collective wage bargaining in shaping regional wage differences in the Spanish labour market. Using microdata from the Spanish Structure of Earnings Survey, our results reveal that there are significant inter-regional wage differences for similarly skilled workers. These differences are present throughout the whole wage structure and can be explained by both competitive and non-competitive factors, such as insufficient competition in product markets. In this context, industry-level collective bargaining plays a major role in accounting for regional wage differences, a role that in the Spanish case is enhanced due to its unusual regional dimension.     

Is inflation targeting or the fixed exchange rate more effective for attracting FDI into developing countries?

This article investigates which monetary policy regime – inflation targeting or the fixed exchange rate – is more effective for attracting FDI inflows into developing countries. Using propensity score matching and the difference-in-differences estimator, we find no evidence that adopting an inflation targeting regime would be more effective than adopting a fixed exchange rate, and vice versa, in encouraging FDI inflows.     

Cost-effectiveness of sacubitril/valsartan versus enalapril in patients with heart failure and reduced ejection fraction

Background: Sacubitril/valsartan reduces cardiovascular death and hospitalizations for heart failure (HF). However, decision-makers need to determine whether its benefits are worth the additional costs, given the low-cost generic status of traditional standard of care.

Aims: To evaluate the cost-effectiveness of sacubitril/valsartan compared to enalapril in patients with HF and reduced ejection fraction, from the Singapore healthcare payer perspective.

Methods: A Markov model was developed to project clinical and economic outcomes of sacubitril/valsartan vs enalapril for 66-year-old patients with HF over 10 years. Key health states included New York Heart Association classes I–IV and deaths; patients in each state incurred a monthly risk of hospitalization for HF and cardiovascular death. Sacubitril/valsartan benefits were modeled by applying the hazard ratios (HRs) in PARADIGM-HF trial to baseline probabilities. Primary model outcomes were total and incremental costs and quality-adjusted life years (QALYs) and the incremental cost-effectiveness ratio (ICER) for sacubitril/valsartan relative to enalapril

Results: Compared to enalapril, sacubitril/valsartan was associated with an ICER of SGD 74,592 (USD 55,198) per QALY gained. A major driver of cost-effectiveness was the cardiovascular mortality benefit of sacubitril/valsartan. The uncertainty of this treatment benefit in the Asian sub-group was tested in sensitivity analyses using a HR of 1 as an upper limit, where the ICERs ranged from SGD 41,019 (USD 30,354) to SGD 1,447,103 (USD 1,070,856) per QALY gained. Probabilistic sensitivity analyses showed the probability of sacubitril/valsartan being cost-effective was below 1%, 12%, and 71% at SGD 20,000, SGD 50,000, and SGD 100,000 per QALY gained, respectively.

Conclusions: At the current daily price sacubitril/valsartan may not represent good value for limited healthcare dollars compared to enalapril in reducing cardiovascular morbidity and mortality in HF in the Singapore healthcare setting. This study highlights the cost-benefit trade-off that healthcare professionals and patients face when considering therapy.     

Television advertising television: measuring the ability of television promos to deliver ratings for new programs using single-source data

The entertainment industry relies heavily on advertising to attract audiences. This article demonstrates a method to measure the effect of on-air television promotions, or promos, on viewing behaviour, based on a well-established single-source method for determining the causal impact of advertising on sales. We illustrate this method on 18 new prime-time programs, showing that promos have a positive impact on viewing behaviour. Exposed viewers are substantially more likely to view the premiere episode of a new series, across a wide range of different television-viewing weights, frequency of promo exposures and program types. The research also shows evidence of reach-based scheduling strategies being generally more efficacious than frequency-based strategies. These findings provide guidance to help networks implement their promo strategy more effectively, as well as a method for future research into the effectiveness of television promos as this approach can be utilized in any country with a television ratings panel.     

Surpluses in Disequilibrium Urban Land Markets

It is unlikely that urban land markets are in equilibrium. If land markets are out of equilibrium, zones within an urban area would have residential location surpluses. This paper shows how to derive and estimate an index of income surplus by residential zone. The procedure is applied to the Baltimore Metropolitan Area for 1978. Households should be at attracted to zones with high surpluses. A comparison of the estimated location surpluses and growth rates for the Baltimore area show this correspondence.     

Encouraging organizational performance through the influence of technological distinctive competencies on components of corporate entrepreneurship

Firms’ technological distinctive competencies (TDCs) help CEOs to confront their reality based on technological knowledge to achieve and exploit competitive advantage by encouraging the different dimensions of corporate entrepreneurship (innovation, new business venturing, proactiveness and self-renewal). The main purpose of this paper is thus to highlight how companies that strive to improve technological competencies within the firm achieve higher organizational performance through different components of corporate entrepreneurship and their interrelationships. This study seeks to fill this research gap by analyzing theoretically and empirically how TDCs enhance innovation, new business venturing and proactiveness and their interrelationships to achieve self-renewal and thus improve firms’ organizational performance. The methodology used is LISREL analysis. We test the model with data from 201 Spanish organizations. Our research contributes theoretical and empirical arguments on the value of TDCs to the organization, arguments that are especially important because organizations sometimes fail to achieve sustainable competitive advantage due to their limited understanding of the relationships between these strategic variables.     

Risk aversion, moral hazard, and the principal's loss

Summary. In their seminal paper on the principal-agent model with moral hazard, Grossman and Hart (1983) show that if the agent's utility function is , then the loss to the principal from being unable to observe the agent's action is increasing in the agent's degree of absolute risk aversion. Their proof is restricted to the case where the number of observable outcomes is equal to two, and it uses an argument that is specific to that case. In this note, we provide an alternative proof that generalizes their result to any (finite) number of outcomes. Received: March 21, 2001; revised version: June 21, 2001