The composition of government spending and the multiplier at the zero lower bound

We investigate the size of the multiplier at the ZLB in a New Keynesian model. It ranges from around −0.25 to +1.5, depending on the extent to which the government spending is productive, substitutable or not for private consumption.     

Using stated preference discrete choice modelling to inform health care decision-making: A pilot study of breast screening participation

This study was an important start to explore the feasibility of applying stated preference discrete choice modelling (SPDCM) for use in developing breast screening participation enhancement strategies. It needs to be followed by further research to establish model validity and authoritative results. In the meantime a random effects binary probit choice model was estimated using a main effects with selected 2-way interaction design and a convenience sample of Australian breast cancer screening participants. A response rate of 48% was obtained. Clear preferences for different service configurations were revealed and used to demonstrate how potential strategies to enhance future participation rates of women placed on routine recall could be identified. As anticipated accuracy of screening was the most important attribute of the service to influence the probability of uptake but others were screening time, travel time, information about screening benefits and the desire for privacy lending support to the view that benefit assessment goes beyond health factors. In summary, the SPDCM approach can be regarded as a judicious approach for helping decision-makers improve screening participation.     

Do social product features have value to consumers?

The present paper utilizes a random utility theoretic experimental design to provide estimates of the relative value that selected consumers place on the social features of products. Experiments were conducted in Hong Kong and Australia using both university students and supporters of the human rights organization Amnesty International. The paper focuses on two classes of social features, “labor practices” and “animal rights and the environment”. The results show that the social features of products can, on average, affect an individuals' likelihood of purchasing a product. Also, this paper finds distinctive segments of ethically orientated consumers.     

Tourism in Trinidad and Tobago: carving a niche in a petroleum‐based economy

Trinidad and Tobago lies within one of the world's most tourism‐intensive regions, the Caribbean. Yet, unlike its neighbours, it has not relied heavily on income from travel and tourism since its economy is dominated by the energy sector. The energy sector is the mainstay of the economy contributing approximately 34.1% to the country's GDP, 85.5% to merchandise exports and 37.1% to Government revenues in 2004 (Ministry of Energy, 2006). The Government, in its aim for developed nation status by 2020, recognizes that the energy sector is unable to provide the sustainable jobs needed to achieve this. Thus, the Government's policy strategy, Vision 2020, identifies tourism as one of five (5) sectors that should be developed to contribute to the country's economic development. The tourism industry currently represents 13.8% of total Gross Domestic Product (GDP) in Trinidad and Tobago and is expected to increase its share by nearly three percentage points to 16.5% by 2015. It accounts for 16.7% of total employment, and this is forecasted to rise to 19.2% (WTTC, 2005). Several challenges are evident, that continue to limit the industry's full potential for growth in the country. It is against this background that this paper seeks to identify and analyse the strategies that can be adopted to maximize the contribution of the hospitality and tourism industry to economic development in Trinidad and Tobago. The three main strategies proposed are a greater focus on local entrepreneurship; the re‐orientation of the role of the local financial mechanisms in tourism development and; the development of competitive tourism investment incentives for potential investors in the hospitality and tourism industry. Copyright © 2008 John Wiley & Sons, Ltd.     

Do investment banks listen to their own analysts?

To what extent conflicts of interest affect the investment value of sell-side analyst research is an ongoing debate. We approach this issue from a new direction by investigating how asset-management divisions of investment banks use stock recommendations issued by their own analysts. Based on holdings changes around initiations, upgrades, and downgrades from 1993 to 2003, we find that these bank-affiliated investors follow recommendations from sell-side analysts in general, increasing (decreasing) their relative holdings following positive (negative) recommendations. More importantly, these investors respond more strongly to recommendations issued by their own analysts than to those issued by analysts affiliated with other banks, especially for recommendations on small and low-analyst-coverage firms. Thus, we find that investment banks “eat their own cooking,” showing that these presumably sophisticated institutional investors view sell-side recommendations as having investment value, particularly when the recommendations come from their own analysts.     

A bottleneck capital model of development

A simple augmentation of the Ramsey-Cass-Koopmans growth model allows it to match observed transitions by initially poor economies. A high-convexity installation cost directly dampens investment demand for a first capital input. The resulting scarcity acts as a bottleneck, strongly dampening demand for investment in a complementary capital input as well. The match to observed transitions holds both for narrow and broad interpretations of capital. In either case, the bottleneck capital's share of factor income need not be large.     

Why do the poor live in cities? The role of public transportation

More than 19 percent of people in American central cities are poor. In suburbs, just 7.5 percent of people live in poverty. The income elasticity of demand for land is too low for urban poverty to come from wealthy individuals' wanting to live where land is cheap (the traditional explanation of urban poverty). A significant income elasticity for land exists only because the rich eschew apartment living, and that elasticity is still too low to explain the poor's urbanization. The urbanization of poverty comes mainly from better access to public transportation in central cities.     

Activity-Based Costing for Economic Value Added®

Economic value added, which is the currently popular term for the traditional accounting concept of residual income (RI), subtracts from operating income an interest charge for invested capital. This paper provides an activity-based cost system that supports RI maximization. We construct a model of participative budgeting for a multi-activity firm in which the cost system allocates plant and equipment cost to products using a formula that includes the interest charge. The budget system we design enables decision makers to identify RI-improving opportunities for outsourcing and dropping unprofitable products. The budget system also has the open-architecture property that additional informal communication among activity managers can only serve to increase RI.