Socio-demographics,political attitudes and informal sector employment: A cross-country analysis

In this paper, we empirically investigate the relationship between informal sector employment and micro-level socio-demographic characteristics, political acts and attitudes, and individual norms. Using self-reported individual micro-level data from the World Values Survey for seven developing countries (China, Ecuador, Egypt, Mexico, Peru, South Africa and Yemen), our cross-country regressions and principal component analysis reveal that socio-demographic characteristics of individuals are strong predictors of their informal sector employment. Our estimations further document that individual preferences for an economically strong, interventionist and egalitarian state and confidence in state and political institutions are positively and significantly correlated with informal sector employment, whereas variables associated with confidence in free market institutions and support for competition are negatively and significantly correlated with informal sector employment. We also show that individuals who participate either actively or inactively in peaceful and lawful political processes are significantly less likely to work in the informal sector. Finally, we document that individual norms, such as religiosity and tax morale, are negatively correlated with informal sector employment. Throughout our analysis, instead of having to rely on ad-hoc informality categorizations of third parties, we base our measurement of informal sector employment directly on the self-evaluation of individuals, who have the best information on the degree of their informality.     

On optimal investiment strategies

Suppose an investor has a fixed decision horizon and an appropriate utility function for measuring his or her utility of wealth. If there are only two investment vehicles, a risky and a risk-free asset, then the optimal investment strategy is such that, at any time, the amount invested in the risky asset must be the product of his or her “current risk tolerance” and the risk premium on the risky asset, divided by the square of the diffusion coefficient of the risky asset. In the case of more than one risky asset, the optimal investment strategy is similar, with the ratios of the amounts invested in the different risky assets being constant over time.     

International migration versus foreign investment in the presence of unemployment

"This paper extends the standard (two-factor, one-good) model of international factor movements, to include unemployment due to a minimum-income guarantee within the capital-abundant country. From this country's perspective, we establish important departures from previous (full-employment) results. Most notably, our analysis shows that: (1) free factor mobility is worse than no mobility; (2) the optimal degree of labour migration is zero; and (3) national welfare can always be maximized by an optimal flow of capital. The analysis is then extended to examine: (1) illegal migration; (2) subsidization of employment; and (3) alternative views of unemployment."     

A Global Ex-vessel Fish Price Database: Construction and Applications

Synopsis We describe the first effort at creating a global ex-vessel fish price database, which is required for understanding the economic behavior of participants in the world’s fisheries. We demonstrate potential applications of the database by linking it to a spatially defined catch database, which makes it possible to attach landed values to species in both time and space. This is the first database available publicly where interested members of the public, researchers and managers can easily find and access ex-vessel prices of the world’s major commercial fish species. Preliminary results indicate that the average real price of a number of species have declined between 1950 and 2002. The estimated landed value of fish globally, in year 2000 dollars, was about US$24 billion in 1950. It increased steadily to about US$90 billion in the early 1970s, reached a peak of US$100 billion at the end of the 1980s, and declined to about US$80 billion in 2000. The top 15 fishing countries cumulatively account for 79% of total real landed value, with Japan leading, even though the value of its landings has been declining.      

Some properties of the length of the shortest half

This paper discusses some properties of the length of the shortest half proposed by Rousseeuw and Leroy (1988) as a robust scale estimator.     

Validity — the quest for reality in quantitative and qualitative research

It has been argued that fundamentally different methodological approaches have made for ‘two sociologies’. This view has obscured the fact that the problem of validity has to be tackled independently of any specific methodological premises because of the textuality of sociological data. This does not necessarily imply, however, a single, unified strategy for validity testing. In this paper, some basic theoretical presuppositions underlying the approach to validity testing in quantitative research will be contrasted with the strategies offered by Max Weber's methodological writings on the ideal type. It is argued that the use of ideal typical constructs in qualitative research (exemplified by patient's illness careers) allows systematic validity testing despite the important differences in the conceptualization of social reality which is used in quantitative research, thus serving the purpose of any empirical sociological research, that is, to gain valid insight into societies' concrete reality.     

Thermodynamics and process analysis for future economic scenarios

Economists are increasingly interested in forecasting future costs and benefits of policies for dealing with materials/energy fluxes, polluting emissions and environmental impacts on various scales, from sectoral to global. Computable general equilibrium (CGE) models are currently popular because they project demand and industrial structure into the future, along an equilibrium path. But they are applicable only to the extent that structural changes occur in or near equilibrium, independent of radical technological (or social) change. The alternative tool for analyzing economic implications of scenario assumptions is to use Leontief-type Input-Output (I-O) models. I-O models are unable to endogenize structural shifts (changing I-O coefficients). However, this can be a virtue when considering radical rather than incremental shifts. Postulated I-O tables can be used independently to check the internal consistency of scenarios. Or I-O models can be used to generate scenarios by linking them to econometric macro-drivers (which can, in principle, be CGE models). Explicit process analysis can be integrated, in principle, with I-O models. This hybrid scheme provides a natural means of satisfying physical constraints, especially the first and second laws of thermodynamics. This is important, to avoid constructing scenarios based on physically impossible processes. Process analysis is really the only available tool for constructing physically plausible alternative future I-O tables, and generating materials/energy and waste emissions coefficients. Explicit process analysis also helps avoid several problems characteristic of pure CGE or I-O models, viz. (1) aggregation errors (2) inability to handle arbitrary combinations of co-product and co-input relationships and (3) inability to reflect certain non-linearities such as internal feedback loops.