Consumption externalities: a representative consumer model when agents are heterogeneous

We examine a growth model with consumption externalities where agents differ in their initial capital endowment and their reference group. We show under which conditions the aggregate equilibrium with heterogeneous agents replicates that obtained with a representative consumer, despite the fact that different individuals have different consumption levels. Next we consider the implications of the presence of consumption externalities for the long-run distributions of income and wealth. We find that, in a growing economy, “keeping up with the Joneses” results in less inequality than would prevail in an economy with no consumption externalities.     

Linking drinking to injury--causal attribution of injury to alcohol intake among patients in a Swedish emergency room

This study analysed the drinking patterns and motivation to change drinking behaviours among injury patients who acknowledged alcohol as a factor in their injuries. A cross-sectional study was conducted over 18 months at a Swedish emergency department. A total of 1930 injury patients aged 18 - 70 years were enrolled in the study (76.8% completion rate). Of those who reported drinking, 10% acknowledged alcohol as a factor in their injury. A patient was more likely to report a causal attribution of the injury to alcohol the higher the weekly intake and the higher the frequency of heavy episodic drinking. The motivation to change variables showed a similar pattern of increased likelihood of attributing a causal link of alcohol and injury with increasing discontent with drinking behaviours and increasing desire to change drinking behaviours. The findings suggest that the ability to measure causal attribution of alcohol to injuries could be a promising tool to help patients explore the association between their injuries and alcohol use and motivate patients to modify drinking behaviours in order to avoid future injuries.     

From boom to gloom: Brazilian labour productivity in manufacturing relative to the United States, 1912–2019

Whereas manufacturing seems to hold the key to modern economic growth, the role of manufacturing in economy-wide convergence across countries is debatable. One strand of scholarship argues that productivity levels in manufacturing tend to remain stable across countries, and that economy-wide convergence takes place through structural transformations. Another strand maintains that productivity levels of less-developed countries tend to approach those of developed countries unconditionally, and that deindustrialization thwarts economy-wide convergence. We examine productivity in Brazilian manufacturing relative to the United States, 1912–2019. The result shows dramatic swings in the Brazilian/US productivity ratio, increasing in the decades following the Second World War, peaking in the late 1970s at impressively high levels, and declining precipitously thereafter. This sluggish performance of Brazilian manufacturing since the peak in the late 1970s has probably hindered income convergence with richer countries.