Regime shifts in stock–flow I(2)–I(1) systems: the case of US fiscal sustainability

In the last two decades, fiscal sustainability has been tested through the use of non‐stationary time series analysis. Two different approximations can be found in the literature: first, a univariate approach that has focused on the stochastic properties of the stock of debt and, second, a multivariate one that has focused on the long‐run properties of the flows of expenditures and revenues, i.e., in the stochastic properties of the deficit. In this paper we unify these approaches considering the stock–flow system that fiscal variables configure. Our approach involves working in an I(2) stochastic processes framework. Given the possibility of the existence of regime shifts in the sustainability of US deficit that the literature has pointed out, we develop a new statistic that can be applied to test several types of I(2) cointegration and multicointegration relationships allowing for regime shifts. To test for these kinds of changing long‐run relationships we propose the use of a residual‐based Dickey–Fuller class of statistic that accounts for one structural break. We show that consistent estimates of the break fraction can be obtained through the minimization of the sum of squared residuals when there is I(2) cointegration. The finite sample performance of the proposed statistic is investigated by Monte Carlo simulations. The econometric methodology is applied to assess whether the US fiscal deficit and debt are sustainable. Copyright © 2010 John Wiley & Sons, Ltd.     

Merger policy in innovative industries

We analyze optimal merger policy in R&D-intensive industries with product innovation aiming to improve the quality of products. Our results suggest that a permissive merger policy is rarely optimal in high-tech industries when the antitrust authority considers a welfare standard that balances the impact of mergers on consumers’ surplus and firms’ profits. In particular, relative to a benchmark where the effects from R&D are absent, we show that the optimal merger policy should not be substantially more permissive in the presence of those effects from R&D.     

Perception evaluation kit: a case study with materials and learning styles

International Journal of Technology and Design Education - Materials are elements that configure our built environment and are key components in design and engineering education. This research aims...     

Barcelona seen through the eyes of TripAdvisor: actors,typologies and components of destination image in social media platforms

Recent literature has emphasized the emerging role of social media in generating a destination image. Even so, there is still no clear definition of the main actors, typologies and components prevailing in these environments or the possible differences between diverse social platforms. Specific analysis and comparison of the Barcelona TripAdvisor Forum and a traditional Destination Management Organization (DMO) website showed that actors, typologies and components are platform specific and have both similarities and differences with other sources, including DMO websites and other social media platforms.     

Greenways: a sustainable leisure experience concept for both communities and tourists

This paper reviews the development of greenways/car-free trails as an alternative environmentally friendly communication system and assesses their strengths and weaknesses. It gives the results of a questionnaire survey of 1261 users along a 106-km greenway in Spain linking the Pyrenees with the Mediterranean Sea. Unlike previous studies, sampling was random and unequal probabilities of selection were properly accounted for. The results show a complex range of user profiles, tourist and non-tourist, their perceptions of the trail and some of the direct and indirect impacts of the greenway on the communities through which it passes. Management recommendations flowing from the survey are presented with the aim of increasing the use of accommodation services and businesses in the towns and villages near the greenway and helping create a more sustainable tourism system. The paper illustrates the potential importance of greenways in a future low-carbon tourism strategy adapting to climate change.     

Technological Collaboration: Bridging the Innovation Gap between Small and Large Firms*

This paper analyzes how technological collaboration acts as an input to the innovation process and allows small and medium‐sized enterprises to bridge the innovation gap with their bigger counterparts. Based on a large longitudinal sample of Spanish manufacturing firms, the results show that though technological collaboration is a useful mechanism for firms of all sizes to improve innovativeness, it is a critical factor for the smallest firms. The impact of this collaboration varies depending on innovation output and type of partner. Specifically, the impact of collaboration in small and medium‐sized firms is more significant for product than process innovations. Regarding type of partner, vertical collaboration—with suppliers and clients—has the greatest impact on firm innovativeness, though this effect is clearer for medium‐sized enterprises than for the smallest firms.     

Evidence on the purchasing power parity in a panel of cities

Evidence is provided on the PPP hypothesis using a sample of 50 Spanish cities for a long time period through the application of panel data unit root tests. Although results suggest non-rejection of the PPP, short-run deviations – as measured by half-lives – indicate that real factors might be causing a slow rate of convergence to a common price index, even in highly integrated economies.     

Influence of parties’ behavioural features on motor compensation disputes in insurance markets

Disputes between parties involved in motor insurance claims compensations are analysed. The decision to resolve the disagreement by either negotiation or trial may depend on how risk and confrontation adverse or pessimistic the claimant is. The extent to which these behavioural features of the claimant might influence the final compensation amount is examined. An empirical analysis, fitting a switching regression model to a Spanish database, is conducted in order to analyse whether the choice of the conflict resolution procedure is endogenous to the compensation outcomes. The results show that compensations awarded by courts are always higher, although 95% of cases are settled by negotiation. We show that this is because claimants are adverse to risk and confrontation, and are pessimistic about their chances at trial. By contrast, insurers are risk/confrontation neutral and more objective in relation to the expected trial compensation. During the negotiation insurers accept to pay the subjective compensation values of claimants, since these values are lower than their estimates of compensations at trial.