Expenditure behavior and children's welfare: an analysis of female headed households in Jamaica

This paper presents an analysis on the expenditure behavior and children's welfare among female-headed households in Jamaica. Included in the examination of household composition are the demographic effects, endogeneity of total expenditure, the headship variable and the endogeneity of family structure. Using the 1989 Jamaican Survey of Living Conditions (SLC), expenditure estimation on over 100 goods for 3500 household was examined. This study utilized the Ordinary Least Square estimates, 2 SLC and endogeneity tests, and partnered and unpartnered household heads. Results for the demand for preventive health care were significant among older children in female-headed households, with a 4% increase in the probability of a check-up across all ages. This study presents a partial explanation of lower morbidity rates in female-headed households despite lower budget and total per capita expenditure levels. In conclusion, this study confirms the significant influence of sex and union status of the household head on household expenditure behaviors with implications for individual household members, with more positive outcomes among children despite differences in budget allocation and lower health expenditures.     

Gender as a moderator of the relationship between materialism and fashion clothing involvement among Indian youth

The research examines the role of gender in moderating the relationship between materialism and product involvement with fashion clothing among the Indian youth. The Richins materialism scale and the product involvement and purchase involvement scales developed by O'Cass were used to understand the behaviour of Indian youth towards fashion clothing. The sample (n = 254) comprised of university students from different parts of India. The findings indicate that Indian youth do not possess a high level of materialistic tendencies. Gender has a moderating influence on the relationship between materialism and involvement with fashion clothing. Young men and women differ with respect to their involvement with fashion clothing and even more with regard to their involvement with the purchase of fashion clothing, with women reporting a higher level of involvement in both cases.     

MATERNAL EDUCATION AND CHILD ATTAINMENT IN JAMAICA: TESTING THE BARGAINING POWER HYPOTHESIS†

In a bargaining model of household decision-making, any variable reflecting the outside opportunities of household members will influence household demand patterns. Mother's education has been found to be an important determinant of children's education and health outcomes. This paper argues that within a bargaining framework, mother's education may influence children's health and education by shifting bargaining power within the household. An empirical strategy is developed and applied to data on teenage grade attainment and school enrolment in Jamaica. The results support the bargaining power hypothesis, and imply a broader role for mother's education than has previously been considered.     

An economic analysis of leasebacks

Leaseback decisions by firms involve the simultaneous sale of an asset and a lease agreement with the new owner. Examination of 64 leaseback decisions made by firms during 1979–1987 reveals a significant negative announcement effect. We present a theoretical framework in which all firms prefer to leaseback when there is symmetric information. When there is asymmetry of information between the manager and the market, however, firms with favorable prospects prefer to own the asset. Firms with poor prospects choose to leaseback and capture the associated depreciation tax shield through the sale. Our empirical results indicate that, besides the significant negative announcement effect, firms proposing a leaseback earn negative returns in the three months prior to the announcement. We monitor the performance of these firms for five years after the leaseback decision and compare it to five years before the announcement. There is a significant drop in operating performance as indicated by several key variables such as operating earnings before depreciation and pretax earnings. This is consistent with the hypothesis that firms choose to leaseback when faced with unfavorable future prospects. I would like to thank S.P. Kothari, Cheng-few Lee, Scott Linn, Mike Rozeff, Ramasastry Ambarisha, and an anonymous referee for their comments and suggestions. The usual disclaimer applies.     

An analysis of the corporate insolvency resolution process as a route for acquisitions in India

In India, the Corporate Insolvency Resolution Process (“CIRP”) takes place under the Insolvency and Bankruptcy Code, 2016 (“IBC”). It involves a Resolution Professional inviting resolution plans for the corporate debtor undergoing insolvency. These plans are submitted by various Resolution Applicants and the best resolution plan is approved by the Committee of Creditors and sanctioned by the National Company Law Tribunal. Thus, from an acquisition perspective, the potential acquirer of the stressed asset is required to provide the best bid (in the form of the resolution plan) for the stressed asset which would be able to garner the approval of the Committee of Creditors. The CIRP route has led to successful acquisitions across variegated sectors from steel (Essar Steel) to textiles (Alok Industries) and has become a new and effective tool to undertake acquisitions for prospective acquirers providing a simpler and faster way for acquisition of stressed assets. However, acquisitions through this process are not yet free from their imperfections and there are certain problems, which if addressed, could pave a way for fruitful investments in the Indian economy. This would bolster an investment and acquisition friendly regime in India improving our nation's ranking on the ease of doing business index even further. This article seeks to analyse CIRP as an effective route for acquisitions and identify such problems which are relevant from an acquisition perspective, with the objective and hope that a discussion on these issues can help strengthen and stimulate successful acquisitions and investments in the Indian economy.     

Is There Catch‐Up Growth? Evidence from Three Continents

The ability to correct deficiencies in early childhood malnutrition, what is known as catch‐up growth, has widespread consequences for economic and social development. While clinical evidence of catch‐up has been observed, less clear is the ability to correct for chronic malnutrition found in impoverished environments in the absence of extensive and focused interventions. This paper investigates whether nutritional status at early age affects nutritional status a few years later among children, using panel data from China, South Africa and Nicaragua. The key research question is the extent to which state dependence in linear growth exists among young children, and what family and community level factors mediate state dependency. The answer to this question is crucial for public policy due to the long‐term economic consequences of poor childhood nutrition. Results show strong but not perfect persistence in nutritional status across all countries, indicating that catch‐up growth is possible though unobserved household behaviours tend to worsen the possibility of catch‐up growth. Public policy that can influence these behaviours, especially when children are under 24 months old, can significantly alter nutrition outcomes in South Africa and Nicaragua.     

Zone-quadratic preference,asymmetry and international reserve accretion in India: An empirical investigation

Empirical estimates of the Reserve Bank of India's (RBI) intervention reaction function suggest that the central bank actively intervenes in the foreign exchange market to contain volatility but this intervention is neither continuous nor linear. It is better described by a nonlinear policy reaction function with a target range as opposed to a point target. It responds much more vigorously to appreciating or depreciating pressure outside the target range but the response is much more muted within the range. Moreover, the tolerance band is asymmetric i.e., the RBI responds much more strongly to appreciating pressure than depreciating pressure. Such a policy response in an era of continuous net capital inflows accounts for the large build-up in foreign exchange reserves witnessed in India in the recent past.