Large scale infrastructure investment and economic performance – a case study of Oresund

We analyse the effect of a large scale infrastructure investment, namely the construction of the Oresund bridge, on the local and supra-regional economy. We employ the synthetic control method to construct counterfactual regions that mimic the trajectory of Malmo and Southern Sweden without treatment. Our results point to a positive effect. However, placebo tests in space and time only reveal statistical significance at a larger regional level. The results suggest that spillover effects are eminent.     

Access Pricing,Quality Degradation,and Foreclosure in the Internet

Access to both a local and a global network is needed in order to get complete connection to the Internet. The purpose of this article is to examine the interplay between those two networks and how it affects the domestic public policy towards a domestic provider of local access. We find that a cost-oriented regulation is detrimental to domestic welfare, because it shifts profit to the foreign provider of global access. The optimal policy is that the regulator commits itself to set an access price above costs, possibly the same price as in an unregulated market economy. A regulation of the global access price has a non-monotonic effect on domestic welfare, and there is a potential conflict between international and domestic regulation policy.     

Slack-adjusted efficiency measures and ranking of efficient units

In non-parametric methods many units are calculated as efficient. The article suggests a method for ranking efficient units, not by their efficiency, but by importance as benchmarks for the inefficient units, in contrast to earlier suggestions in the literature which rank units high if they are specialized. However, the total potentials for improvement frequently remain unrevealed by calculating radial efficiency measures of the Farrell type only. The article therefore first develops efficiency measures that explicitly extend the radial measures to include slacks. The new measures are applied to a typical multidimensional small-sample data set for Norwegian employment offices.     

Strategic Regulation Policy in the Internet

Some countries are importers while others are exporters of global backbone connectivity. At the same time, input components such as local access are non-traded. This paper analyzes a non-cooperative regulatory game between importing and exporting countries, assuming that the prices of both traded and non-traded inputs can be regulated. We show that exporting countries choose a more restrictive regulation of non-traded goods than importing countries do. We further show that a requirement of international non-discrimination may hurt importing countries, and give firms producing traded inputs incentives to invest in quality degradation.     

Monetary incentives and environmental concern. Effects of a differentiated garbage fee

Market-based instruments, i.e., economic incentives and disincentives, are gaining popularity in environmental policy. However, research on the effectiveness of economic incentives for regulating environmentally relevant consumer behaviour demonstrates convincingly that the implementation of this instrument is based on inadequate assumptions concerning the motivation guiding consumer behaviour. In this paper it is argued that stronger focus should be placed on studying how the regulation instrument influences the perception of the environmentally relevant activity that it was meant to regulate. The attitudes of Danish citizens towards differentiated garbage fees (implying a relatively small economic incentive) and the impact of its implementation on the attitude towards recycling are analysed. The attitude towards differentiated garbage fees is primarily determined by the perceived equity of differentiated garbage fees and its perceived effectiveness with regard to combating waste problems. The most important determinant of the attitudes towards recycling activities is the expected environmental and public benefits. However, empirical support is found for the hypothesis that the use of monetary incentives at the consumer level may re-frame the recycling issue into the sphere where private cost-benefit calculations apply. The negative effects of this re-framing can more than outweigh the positive impact of the monetary incentive on attitudes and behaviour.

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Zusammenfassung Monetäre Anreize und Umweltbewutsein. Die Wirkung differenzierter Müllgebühren. Marktkonforme Instrumente wie ökonomische Anreize oder Strafen werden in der Umweltpolitik immer populärer. Allerdings zeigen Forschungsergebnisse über die Wirksamkeit ökonomischer Anreize für die Regulierung umweltrelevanten Konsumentenverhaltens, da\ die Anwendung dieses Instrumentes auf unzweckmä\igen Annahmen über die Motivation beruht, die dem Verbraucherverhalten zugrunde liegt. In diesem Beitrag wird gefordert, da\ die Frage stärker in den Mittelpunkt gerückt werden mu\, wie das Regulierungsintrument die Wahrnehmung des umweltrelevanten Verhaltens beeinflu\t, das reguliert werden soll. Eine empirische Studie untersucht die Einstellungen dänischer Bürger gegenüber differenzierten Abfallgebühren (die einen relativ kleinen ökonomischen Anreiz bieten) und die Wirkung dieser Ma\nahme auf die Einstellung gegenüber der Wiederverwertung. Die Einstellung zu differenzierten Müllgebühren wird in erster Linie durch ihre wahrgenommene Gerechtigkeit bestimmt und durch ihre wahrgenommene Wirksamkeit gegenüber den Müllproblemen. Die wichtigsten Determinanten der Einstellung gegenüber der Müllwiederverwertung sind ihre erwarteten allgemeinen Umweltvorteile. Allerdings sprechen die Daten für die Hypothese, da\ monetäre Anreize das Thema der Müllwiederverwertung auf Verbraucherebene auf das Niveau privater Nutzen-Kosten-Kalkulationen herunterdrücken. Die negativen Effekte dieser Verschiebung könnten die positiven Wirkungen monetärer Anreize auf Einstellung und Verhalten sogar überkompensieren.

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The research reported in this paper was sponsored by grants from the Danish Environmental Protection Agency and the Danish Social Science Research Council.     

The Great Collapse in Value Added Trade

This paper studies the great collapse in value added trade using a structural decomposition analysis. We show that changes in vertical specialization accounted for more than 40% of the great trade collapse. Second, we find that the drop in the overall level of demand accounted for roughly a quarter of the decline in value added exports while just under one third was due to compositional changes in final demand. Finally, we demonstrate that the dichotomy between services and manufacturing sectors observed in gross exports during the great trade collapse is not apparent in value added trade data.     

Consumption Fluctuations and Expected Returns

This paper introduces a novel consumption-based variable, cyclical consumption, and examines its predictive properties for stock returns. Future expected stock returns are high (low) when aggregate consumption falls (rises) relative to its trend and marginal utility from current consumption is high (low). We show that the empirical evidence ties consumption decisions of agents to time variation in returns in a manner consistent with asset pricing models based on external habit formation. The predictive power of cyclical consumption is not confined to bad times and subsumes the predictability of many popular forecasting variables.     

Regulations for the Eighth International Congress of Actuaries

Abstract

The present paper proposes and investigates a procedure for numerical evaluation of the transition probabilities for a time-inhomogeneous Markov process when the intensities are known (estimated). The procedure is based on Taylor-expansion of the transition probabilities linked with the Chapman-Kolmogorov equations.     

Cognitive,Emotional, and Sociocultural Processes in Consumption

This article examines deliberative, emotional, and sociocultural processes in consumption. The authors draw upon basic processes from two leading theories in social psychology, the theory of planned behavior (TPB) and the model of goal‐directed behavior (MGB), to develop a comprehensive approach to decision making more appropriate for many consumption decisions, and revise the representation and modeling of key variables to better reflect how social psychological processes relate to consumer behavior. A survey was conducted among real adult consumers of bacalhau in Portugal. Because it is most common for women to prepare bacalhau meals in Portugal, 153 female participants were recruited for this survey. The results show that the TPB, and especially the MGB, are found to explain food consumption decisions well but only after the approaches are modified in form and content to accommodate the complex emotional and social aspects of the consumption context. The results also show that the effects of key determinants of desire in the MGB are contingent on the traits of food involvement and cultural orientation (i.e., degree of vertical individualism). The approach taken herein overcomes limitations of existing theories by synthesizing relevant processes across two leading theories and by introducing new variables and processes, thereby showing that the organization of these processes and their contingency on cultural variables regulate consumption.