Finite sample multivariate structural change tests with application to energy demand models

This paper considers finite sample motivated structural change tests in the multivariate linear regression model with application to energy demand models, in which case commonly used structural change tests remain asymptotic. As in Dufour and Kiviet [1996. Exact tests for structural change in first-order dynamic models. Journal of Econometrics 70, 39–68], we account for intervening nuisance parameters through a two-stage maximized Monte Carlo test procedure. Our contributions can be classified into five categories: (i) we extend tests for which a finite-sample theory has been supplied for Gaussian distributions to the non-Gaussian context; (ii) we show that Bai et al. [1998. Testing and dating common breaks in multi-variate time series. The Review of Economic Studies 65 (3), 395–432] test severely over-rejects and propose exact variants of this test; (iii) we consider predictive break test approaches which generalize tests in Dufour [1980. Dummy variables and predictive tests for structural change. Economics Letters 6, 241–247] and Dufour and Kiviet [1996. Exact tests for structural change in first-order dynamic models. Journal of Econometrics 70, 39–68]; (iv) we propose exact (non-Bonferonni based) extensions of the multivariate outliers test from Wilks [1963. Multivariate statistical outliers. Sankhya Series A 25, 407–426] to models with covariates; (v) we apply these tests to the energy demand system analyzed by Arsenault et al. [1995. A total energy demand model of Québec: forecasting properties. Energy Economics 17 (2), 163–171]. For two out of the six industrial sectors analyzed over the 1962–2000 period, break and further goodness-of-fit and diagnostic tests allow to identify (and correct) specification problems arising from historical regulatory changes or (possibly random) industry-specific effects. The procedures we propose have potential useful applications in statistics, econometrics and finance (e.g. event studies).     

DOES WORKSHARING WORK? SOME EMPIRICAL EVIDENCE FROM THE IAB‐ESTABLISHMENT PANEL

Recent policy debate in Europe suggests that a shorter workweek will lead to more jobs (worksharing). We derive and estimate a model where the firm employs two types of workers, some working overtime, the rest standard hours. Worksharing is not always a prediction of the theory. Using German establishment‐level panel data (the IAB‐ESTABLISHMENT panel), 1993–1999, we find no evidence of pro‐worksharing effects except in small plants in the East German non‐service sector. There is evidence that a cut in standard hours lowers the proportion of overtime workers in a plant, as predicted by the theory, and increases the proportion of standard‐time plants.     

Pricing-to-market tests in instrumental regressions: Case of the transportation equipment industry

Pricing-to-market (PTM) theory suggests that exporting monopolistic firms adjust their destination-specific mark-ups in the face of exchange rate shocks. A large proportion of the existing evidence for PTM comes from Wald tests applied to OLS- and IV-estimated parameters of single-equation models. Such tests can seriously over-reject in the presence of endogeneity and weak instruments so that some of the available results supporting PTM could be spurious. In this paper we revisit the PTM evidence for Japanese and German exporting firms in the transportation equipment industry. Using the model of Marston (1990), we apply exogeneity and LR-LIML-based tests for which the error probability is controlled irrespective of the quality of the available instruments. Our results show right-hand-side endogeneity in almost all of the examined PTM equations. In addition, we find that statistical decisions often differ depending on whether they are based on the traditional Wald test or on our proposed test.The authors would like to thank Philippe Barla, Jean-Thomas Bernard, Christos Constantatos, Larry Schembri, seminar participants at the Bank of Canada, and two anonymous referees for useful comments and suggestions. Thanks also to Richard Marston for providing data. Finally, a special thanks to Marjorie Santos for excellent research assistance. All remaining errors are our own and should not be attributed to the Bank of Canada.First version received: May 2002/Final version received: December 2002     

Personal service companies and the public sector

Off-payroll workers in the UK, including personal service companies (PSCs), engaged by the public sector have been giving ‘assurance’ of their tax position to departments in the sector since 2012. Departments must be satisfied with the assurance. For PSCs this requires awareness of complex tax legislation (IR35), which is aimed at preventing tax avoidance. Costs may be incurred in attaining the necessary knowledge. This may bring into question costs incurred in protecting tax revenue. No similar obligation exists in the private sector.     

Efficiency of New Zealand’s District Health Boards at Providing Hospital Services: A stochastic frontier analysis

Journal of Productivity Analysis - The majority of secondary and tertiary healthcare services in New Zealand are provided through public hospitals managed by 20 local District Health Boards. Due to...     

Predictors of registered nurses' willingness to remain in nursing

A major question about the adequacy of the future supply of nurses is how many will stay in the profession. The relationship between scheduling and propensity to stay or leave the nursing profession was examined in this study. This analysis suggests there are definite characteristics of the work schedules that can influence a nurse's inclination to stay or leave the profession. This is not simply a question of "overwork," but of matching work schedules and hours as closely as possible to employee expectations. This suggests management needs to find a way to pay attention when nurses request changes in hours. The mere fact of changing schedules will not solve the nursing shortage, but it is one action within the management control of any organization employing nurses that could have a positive effect on retention.     

Going to the movies: cinema development in Singapore

Using readings of Foucault's heterotropia and Friedberg's imaginary mobility, this paper analyses movie-going as leisure practice. In highlighting the paucity of research in this area, the paper argues that such practice should be understood as a symbolic interaction between people's behaviour and the spaces that they occupy. This theorization is applied to Singapore, where per capita movie-going is amongst the highest in the world. The paper illustrates how, in Singapore, the development of cinemas has been used to underpin land use policies associated with the relocation of residential areas and social policies related to the growth in consumerism. While effectively alienating older audiences, the paper argues that the spatial and cultural metonymy of the cinema with other primary consumption sites – the mall and the fast food outlet – offers young people reassurance about the growing centrality of consumerism to contemporary social life in Singapore. We argue that the cinema offers a temporary escape from the regulation of social life – access to ‘deviant’ space. However, this same consumerism that facilitates such access simultaneously denotes conformity with the dominant ideology: acceptance of the heterotropic possibilities – and limitations – of cinema and movie-going as leisure practice.     

Learning to glow

Create a cooperative environment within your organization and you will radiate energy, innovation and success, says Lynda Gratton .