Discriminating Among Alternative Theories of the Multinational Enterprise

Recent theoretical developments have incorporated endogenous multinational firms into the general–equilibrium model of trade. One simple taxonomy separates the theory into "vertical" models, in which firms geographically separate activities by stages of production, and "horizontal" models, in which multiplant firms duplicate roughly the same activities in many countries. The authors nest a horizontal and a vertical model within a hybrid (unrestricted) "knowledge–capital model" and estimate the specifications with data on US foreign direct investment activity. In the nested econometric tests, the data sample cannot distinguish statistically between the unrestricted model and the restricted horizontal model, indicating that the latter captures virtually all of the determinants of FDI. The tests overwhelmingly reject the vertical model.     

Listen and learn

After making a solicitation, a lot can be gained by listening to a donor's questions. Do not simply answer the question. Consider why they asked it in the first place.     

The demographic impact of AIDS in sub-Saharan Africa: short- and long-term projections

"This paper describes the methodology used to incorporate AIDS mortality in recently revised World Bank population projections....The paper first reviews different approaches for projecting AIDS and its demographic consequences. This is followed by a summary of an epidemiological model that simulates the spread of HIV used in this analysis, and a demographic model that translates mortality from AIDS into population outcomes. These models are then used in a set of simulations, from which the effect of current HIV prevalence on projected future mortality is extracted. Finally, the extracted equations linking current HIV prevalence with future mortality indicators are applied to sub-Saharan countries with a measurable level of current HIV prevalence."