Human capital and economic development

This paper develops a general equilibrium model of fertility and human capital investment with young adult mortality. Because young adult mortality is negatively related to average young adult human capital, human capital accumulation lowers mortality, inducing demographic transition and industrial revolution. Data confirm that young adult mortality is related negatively to schooling, and the rate of return to schooling, and positively to fertility. The data indicate a negative relationship between TFP growth and schooling accumulation. The model fits the data on country populations, per capita incomes, human capital, total fertility rates, infant mortality, life expectancy and conditional life expectancy.     

The impact of accounting restatements on corporate innovation strategy

This study examines the effect of accounting restatements on corporate innovation strategy. Using a sample of restating firms and propensity-score-matched non-restating firms from 2000 to 2009, we find that, after restatements, restating firms experience a greater increase in exploratory innovation and a greater reduction in exploitative innovation compared to non-restating firms. These results suggest that restating firms are associated with an increased risk appetite as managers believe the upside potential may yield corporate improvement. The results also differ between fraudulent and non-fraudulent restatements, and among restatements of varying severity. The results of this study shed light on a previously unexplored consequence of accounting restatement and highlight its real impact on corporate business strategy.     

International flows of people and institutional change

International travel clearly increases human interaction over space and exposes societies to foreign influences, foreign ideas, and foreign institutions. Does international travel promote institutional change in a traveler's home country? This paper uses panel data from 149 countries to test the hypothesis of institutional change stemming from international travel. We generally find that foreign travel does not affect political institutions. In one sub-sample, we find limited evidence that international travel can be a determinant of institutional quality in the home country depending upon whether the home country is an autocracy or democracy.     

Labour Supply,Life Satisfaction,and the (Dis)Utility of Work*

In economic theory, it is typically assumed that there is a “disutility of labour”. However, empirical research on subjective well‐being has consistently shown that unemployed people are less happy than employed people, even after taking income differences into account. In this paper, we attempt to reconcile both findings. We show that happiness and work hours exhibit an inverse U‐shaped relation – working longer raises the level of happiness, as long as the total working time is not too long. Hence, working can be beneficial for happiness and, at the same time, it can exert a disutility at the margin.     

How Inequality Affects Trust in Institutions: Evidence from Indonesia

Trust is an important ingredient to improve economic performance and people's welfare by alleviating market failures caused by imperfect information, costly enforcement, or coordination failures. Using the World Values Survey 2018, we estimate the impact of village and district levels inequality on trust in institutions in Indonesia. We find that higher village level inequality has a negative effect only on trust in strangers, while higher district level inequality reduces trust in television, the press, the central government, the courts, and the police. The implication points to the importance of keeping inequality at the aggregate level in check to maintain people's trust in social, political and state institutions.     

Complex solutions of nonconcave dynamic optimization models

Summary In this paper we consider a class of time discrete intertemporal optimization models in one dimension. We present a technique to construct intertemporal optimization models with nonconcave objective functions, such that the optimal policy function coincides with any pre-specifiedC ² function. Our result is a variant of the approach presented in a seminal paper by Boldrin and Montrucchio (1986). Whereas they solved the inverse problem for the reduced form models, we address the different question of how to construct both reduced and primitive form models. Using our technique one can guarantee required qualitative properties not only in reduced, but also in primitive form. The fact that our constructed model has a single valued and continuous optimal policy is very important as, in general, nonconcave problems yield set valued optimal policy correspondences which are typically hard to analyze. To illustrate our constructive approach we apply it to a simple nonconcave model.We are grateful for the helpful comments of L. Montrucchio, K. Nishimura, T. Mitra and an anonymous referee. Financial support of the Austrian Science Foundation under contract No. P7783-PHY and No. J01003-SOZ is gratefully acknowledged. This paper was written while M. Kopel was visiting the Department of Economics, Cornell University.     

Who makes,who breaks: Which scientists stay in academe?

We examine the survival of young scientists in academe. The propensity to leave follows an inverse u-shape. Publishing increases and patenting decreases the chance of survival. Scientists with strong preferences for business are less likely to stay in academe.     

自然主义特点在欧亨利作品中的体现(英文)

欧·亨利是二十世纪初崛起于美国文坛的著名短篇小说作家,其作品构思布局巧妙,语言幽默风趣,尤其是出乎意料的结尾更是别具一格,脍炙人口。19世纪到二十世纪,现实主义思想和自然主义理论的表现方式走到美国的文学里。欧亨利作为美国的短片小说之父,在他的作品中既体现了现实主义的残酷与无奈,同时又表现出自然主义的本质。     

ICP 2005 Construction Prices: Are They Underestimated in Developing Countries?

Construction prices are lower in developing countries in ICP 2005, which has raised these countries' capital/output ratio in Penn World Tables 7 and 8 and affected growth analyses. We estimate the Colombia/U.S. price ratio for office and apartment buildings in 2005 as a test of the validity of the ICP 2005 methodology for estimating these prices. Our estimate of the Colombia/U.S. price ratio is almost twice the ICP 2005 estimate. We confirm the validity of our results by estimating the cost of constructing office and apartment buildings using 2005 prices for construction materials, equipment, and labor in both countries.