Are there economies of scale in the demand for money by firms? Some panel data estimates

We estimate elasticities of scale in the demand for money by firms using firm level panel data from Spain, the UK, and the US. This elasticity is one for Spain and the UK but smaller for the US. We find that the errors in the money demand equations contain two terms that are correlated with sales. Firstly, a permanent firm effect that captures differences in technological sophistication. Secondly, a measurement error in sales, which becomes relevant when relying on changes in sales to account for fixed effects. Failure to control for these correlated unobservable terms results in important biases in the estimated sales elasticities.     

Full wages,part-time employment and the minimum wage

The economic effects of the minimum wage have become increasingly ambiguous. Historically, economists have asserted that increases in the minimum wage result in increases in unemployment. This relationship has been challenged recently by Card and Krueger, Katz and Krueger, and Card. These authors have provided empirical evidence that seems to indicate that there is no relationship between various economic variables (such as level of employment, and product price, among others) and the minimum wage. In addition, these authors have not provided a cogent presentation of the effects of the minimum wage on part-time employment. This study examines, from a theoretical standpoint, the effects of the minimum wage on employment. Furthermore, we emphasize the distinction between money wages and full wages; and the role that part-time employmentplays in the analysis. After incorporating these factors into a theoretical presentation, we provide empirical evidence by way of an OLS regression. We conclude that firms respond to increases in the minimum wage by altering the level of part-time employment. By doing this, firms are able to absorb the minimum wage increase because part timers receive fewer fringe benefits.     

Overconfidence and Corporate Tax Policy

Review of Accounting Studies - Using a sample of firms experiencing exogenous CEO departures, we investigate whether firms with overconfident CEOs avoid more tax. We find robust evidence of a...     

Editorial

The essay attempts to provide a theoretical framework for leisure research by concentrating on the conception of adventure as a form of leisure. Adventure is presented as a multidimensional field of experience and investigation. Six dimensions of adventurous activity and experience are introduced: territoriality; duration; transcendence; risk; coping; and routinization. Routinization is a critical dimension which, in contrast to the romantic idealization of adventure, makes it impossible to see adventure as a sphere independent of society.     

Spatial variations in the relationship between economic diversity and stability

Using US county-level data, we explore how economic diversity influenced economic stability over the period of the Great Recession. We find that higher diversity is associated with greater stability, but there are distinct spatial patterns and the relationship does not hold for much of the central part of the US.