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on Business Economics |
| By: | M. Hashem Pesaran; Martin Weale |
| Abstract: | This paper focuses on survey expectations and discusses their uses for testing and modeling of expectations. Alternative models of expectations formation are reviewed and the importance of allowing for heterogeneity of expectations is emphasized. A weak form of the rational expectations hypothesis which focuses on average expectations rather than individual expectations is advanced. Other models of expectations formation, such as the adaptive expectations hypothesis, are briefly discussed. Testable implications of rational and extrapolative models of expectations are reviewed and the importance of the loss function for the interpretation of the test results is discussed. The paper then provides an account of the various surveys of expectations, reviews alternative methods of quantifying the qualitative surveys, and discusses the use of aggregate and individual survey responses in the analysis of expectations and for forecasting. |
| Keywords: | models of expectation formation, survey data, heterogeneity, tests of rational expectations |
| JEL: | C40 C50 C53 C80 |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:0536&r=bec |
| By: | Claudio Michelacci; Olmo Silva (CEMFI, Centro de Estudios Monetarios y Financieros) |
| Abstract: | We document that the fraction of entrepreneurs who work in the region where they were born is significantly higher than the corresponding fraction for dependent workers. This difference is more pronounced in more developed regions and positively related to the degree of local financial development. Frims created by locals are more valuable and bigger (in terms of capital and employment), operate with more capital intensive technologies, and are able to obtain greater financing per unit of capital invested, than firms created by non-locals. This evidence suggests that there are so many local entrepreneurs because locals can better exploit the financial opportunities available in the region where they were born. This can help explaining how local financial development cause presistent disparities in entrepreneurial activity, technology, and income. |
| Keywords: | Entreprenurship, economic and financial development, social capital. |
| JEL: | J23 O12 O16 Z13 |
| Date: | 2005–05 |
| URL: | http://d.repec.org/n?u=RePEc:cmf:wpaper:wp2005_0506&r=bec |
| By: | Michele Boldrin; David K Levine |
| Date: | 2005–08–28 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levarc:618897000000000954&r=bec |
| By: | Dirk Krueger (University of Frankfurt, NBER, CEPR, and CFS); Fabrizio Perri (New York University, Federal Reserve Bank of Minneapolis) |
| Abstract: | Using data from the Consumer Expenditure Survey we first document that the recent increase in income inequality in the US has not been accompanied by a corresponding rise in consumption inequality. Much of this divergence is due to different trends in within-group inequality, which has increased significantly for income but little for consumption. We then develop a simple framework that allows us to analytically characterize how within-group income inequality affects consumption inequality in a world in which agents can trade a full set of contingent consumption claims, subject to endogenous constraints emanating from the limited enforcement of intertemporal contracts (as in Kehoe and Levine, 1993). Finally, we quantitatively evaluate, in the context of a calibrated general equilibrium production economy, whether this set-up, or alternatively a standard incomplete markets model (as in Ayiagari 1994), can account for the documented stylized consumption inequality facts from the US data. |
| Keywords: | Limited Enforcement, Risk Sharing, Consumption Inequality |
| JEL: | E21 D91 D63 D31 G22 |
| Date: | 2005–01–15 |
| URL: | http://d.repec.org/n?u=RePEc:cfs:cfswop:wp200515&r=bec |
| By: | Tarek Harchaoui; Faouzi Tarkhani; Terence Yuen |
| Abstract: | Using industry-level data for 22 Canadian manufacturing industries, the authors examine the relationship between exchange rates and investment during the period 1981-97. Their empirical results show that the overall effect of exchange rates on total investment is statistically insignificant. Further investigation reveals the non-uniform investment response to exchange rate movements in three channels. First, it is important to distinguish between environments that have low and high exchange rate volatilities. Through changes in output demands, depreciations would have a positive effect on total investment when the exchange rate volatility is low. Yet, this stimulative effect becomes considerably smaller as the volatility increases. Second, these results for total investment are mainly due to movements in other machinery and equipment, and not to investment in information technology and structures. Third, investment in industries with low markup ratios are more likely to be affected by exchange rate movements. |
| Keywords: | Exchange rates; Domestic demand and components |
| JEL: | F4 D24 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocawp:05-22&r=bec |
| By: | Jacques Cremer; Luis Garicano; Andrea Prat |
| Date: | 2005–08–31 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levrem:784828000000000373&r=bec |
| By: | Luisa Montuschi |
| Abstract: | Information and communication technologies are invading all aspects of human existence and are challenging many individual and social values. Computer technologies, Internet and the World Wide Web have created possibilities at global level for individuals and organizations that were not available before. But many ethical questions have arisen because changes are affecting human relationships, social institutions and basic moral notions. This paper considers some ethical issues related to the information and communication technologies, particularly the questions associated with computer technology, the Internet and the World Wide Web. |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:cem:doctra:298&r=bec |
| By: | Germán Coloma |
| Abstract: | This paper develops an oligopoly model with firms that may potentially be public or private, and solves it for different cases in which the number and ownership of those firms vary. The results are then compared in terms of total surplus and consumer surplus, and this comparison produces implications for the antitrust appraisal of possible mergers and acquisitions. It follows that certain types of mergers are unambiguously favorable or unfavorable from the point of view of their contribution to both total and consumer surplus, while others may be convenient in one of those dimensions but inconvenient in the other dimension. |
| JEL: | D43 L33 L44 |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:cem:doctra:299&r=bec |