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Book part
Publication date: 29 February 2008

Jennifer L. Castle and David F. Hendry

Structural models' inflation forecasts are often inferior to those of naïve devices. This chapter theoretically and empirically assesses this for UK annual and quarterly…

Abstract

Structural models' inflation forecasts are often inferior to those of naïve devices. This chapter theoretically and empirically assesses this for UK annual and quarterly inflation, using the theoretical framework in Clements and Hendry (1998, 1999). Forecasts from equilibrium-correction mechanisms, built by automatic model selection, are compared to various robust devices. Forecast-error taxonomies for aggregated and time-disaggregated information reveal that the impacts of structural breaks are identical between these, helping to interpret the empirical findings. Forecast failures in structural models are driven by their deterministic terms, confirming location shifts as a pernicious cause thereof, and explaining the success of robust devices.

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Forecasting in the Presence of Structural Breaks and Model Uncertainty
Type: Book
ISBN: 978-1-84950-540-6

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Book part
Publication date: 3 August 2015

Ion Sterpan and Paul Dragos Aligica

This paper explores the interface between institutional theory and Austrian theory. We examine mainstream institutionalism as exemplified by D. C. North in his work with…

Abstract

This paper explores the interface between institutional theory and Austrian theory. We examine mainstream institutionalism as exemplified by D. C. North in his work with Wallis and Weingast on the elite compact theory of social order and of transitions to impersonal rights, and propose instead an Austrian process-oriented perspective. We argue that mainstream institutionalism does not fully account for the efficiency of impersonal rules. Their efficiency can be better explained by a market for rules, which in turn requires a stable plurality of governance providers. Since an equilibrium of plural providers requires stable power polycentricity, the implication goes against consolidating organized means for violence as a doorstep condition to successful transitions. The paper demonstrates how to employ Ostroms’ Bloomington School Institutionalism to shift, convert, and recalibrate mainstream institutionalism's themes into an Austrian process-oriented theory.

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New Thinking in Austrian Political Economy
Type: Book
ISBN: 978-1-78560-137-8

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Book part
Publication date: 28 December 2018

John A. Bishop and Haiyong Liu

This chapter argues that in countries with well-functioning democracies most individuals should be “content” with the underlying income distribution. The authors derive…

Abstract

This chapter argues that in countries with well-functioning democracies most individuals should be “content” with the underlying income distribution. The authors derive this result from James Buchanan’s notion of a “fiscal constitution.” The authors test this hypothesis using data from the World Values Survey where respondents are asked whether “incomes should be more equal …, or do we need larger differences in income as incentives?” The authors’ empirical results indicate that the concentration of re-distributional preferences around the median response is positively related to the presence of a democratic voice.

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Inequality, Taxation and Intergenerational Transmission
Type: Book
ISBN: 978-1-78756-458-9

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Article
Publication date: 16 July 2020

Trey Malone and Antonios M. Koumpias

This research note compares voter opinions regarding small business entrepreneurial activity to opinions of small business owners and links any divergence in perceptions…

Abstract

Purpose

This research note compares voter opinions regarding small business entrepreneurial activity to opinions of small business owners and links any divergence in perceptions to realized suboptimal entrepreneurial growth policy.

Design/methodology/approach

Primary data collection via best–worst scaling and estimation of linear regression models.

Findings

Results suggest that small business owners are less concerned about issues such as foreign competition, estate/death taxes, oil prices and labor union demands but are more concerned with domestic competition, income taxes, regulatory burdens and availability of credit from lenders.

Social implications

The authors find major discrepancies in opinions about trade policy and business financing, which may lead to policy design that hinders entrepreneurship given evidence that politicians do respond to voters' opinions (Autor et al., 2016).

Originality/value

It represents the first empirical assessment of differences between voter and small business owner perspectives on entrepreneurial policy. An immediate policy implication includes the need to provide additional avenues of communication of entrepreneurs' concerns.

Details

Journal of Entrepreneurship and Public Policy, vol. 9 no. 3
Type: Research Article
ISSN: 2045-2101

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Article
Publication date: 30 October 2020

Tonglong Zhang, Xiaowen Huang, Lina Zhang and Linxiu Zhang

The purpose of this paper is to assess the development of China's rural labor markets and the identification of the important factors that affect rural labor's off-farm…

Abstract

Purpose

The purpose of this paper is to assess the development of China's rural labor markets and the identification of the important factors that affect rural labor's off-farm employment and migration.

Design/methodology/approach

Based on a set of long-term panel data, this paper makes a clear judgment on the trend of rural labor transfer. High-quality survey design makes it possible to examine the development of the rural labor market from multiple dimensions. Adding household fixed effects to the empirical model alleviates endogenous problems.

Findings

The authors find that the increasing trend toward off-farm employment, which is dominated by migration, has continued. There are some other important findings: (1). young male workers dominated off-farm employment, but the gap between groups continues to narrow; (2). the structure of employment is a good response to the economic transformation and (3). the quality of off-farm laborers, especially in terms of human capital, has also enhanced significantly and has continued to support off-farm employment and migration. These findings all indicate that the China's rural labor markets have been constantly improving in recent years, although there is still segmentation.

Originality/value

It is the first paper that uses a nationally representative survey data to address the development of rural labor market in the 21st century. With the help of a long-term panel data structure and by controlling the household-level fixed-effect, the authors obtained a deeper and more robust conclusion. Specifically, this article finds that whether it is for the off-farm transfer or the migration, the influence of labor age, gender, human capital and marital status is gradually weakening.

Details

China Agricultural Economic Review, vol. 13 no. 2
Type: Research Article
ISSN: 1756-137X

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Article
Publication date: 9 April 2018

Irene Daskalopoulou

The purpose of this paper is to investigate how different types of social capital contribute to the satisfaction with democracy (SWD) in Greece. Understanding the…

Abstract

Purpose

The purpose of this paper is to investigate how different types of social capital contribute to the satisfaction with democracy (SWD) in Greece. Understanding the relationship between different variants of social capital and SWD allows one to situate the Greek democracy in the continuum of democracy types, from primary to modern.

Design/methodology/approach

The study uses microdata extracted from the European Values Surveys of 2002-2010 and multivariate regression analysis.

Findings

The results are compatible with a conception of the Greek political organization as a civil virtue democracy. A change in the nature of the relationship is observed after the recent economic crisis in the country.

Research limitations/implications

The study contributes to the empirical knowledge regarding the relationship between different variants of social capital and SWD.

Originality/value

Using a typology approach, the micro-relationship between democracy and social capital is analyzed as embedded in a continuum of different democracy types. In addition, this is the first study that uses microdata to analyze the effect of social capital upon SWD in Greece. The results of the study provide valuable understanding of the social and institutional arrangements that might sustain Greece’s efforts to meet its overall developmental challenges.

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International Journal of Social Economics, vol. 45 no. 4
Type: Research Article
ISSN: 0306-8293

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Article
Publication date: 11 September 2018

Blake Rayfield and Omer Unsal

The purpose of this paper is to use a unique, hand-collected data set of Food and Drug Administration (FDA)-approved products to understand the effect of lobbying on the…

Abstract

Purpose

The purpose of this paper is to use a unique, hand-collected data set of Food and Drug Administration (FDA)-approved products to understand the effect of lobbying on the product market. The authors gather total 86,462 FDA labels including drug patents, drugs, pre-market approvals and medical devices and test the relationship between lobbying and future firms’ product submissions.

Design/methodology/approach

Using a sample of 86,462 FDA labels including drug patents, drugs, pre-market approvals and medical devices, the authors test the effect of lobbying on a firm’s future product submissions using survival analysis, logit, difference-in-differences and propensity score matching techniques.

Findings

The authors find lobbying firms experience an increase in the number of medical products approved. However, increased number of FDA labeling comes at the cost of product failure. The authors document that lobbying increases product recalls when responsible firms are associated with higher market withdrawals.

Originality/value

This study contributes to both the management literature on corporate lobbying and product recalls. Additionally, the study reveals the connection between pharmaceutical lobbying and firm value.

Details

Management Decision, vol. 57 no. 3
Type: Research Article
ISSN: 0025-1747

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Article
Publication date: 27 May 2014

ZhenHua Gu and Yao Shen

Will a free trade agreement (FTA) between nations be politically viable? Under political lobbying, which incentives determine whether FTAs will be signed or not? Will FTAs…

Abstract

Purpose

Will a free trade agreement (FTA) between nations be politically viable? Under political lobbying, which incentives determine whether FTAs will be signed or not? Will FTAs steadily include more countries until we reach a worldwide free trade? The paper addresses these questions using a theoretical analysis model, with “protection for sale” model as the foundation.

Design/methodology/approach

Firstly, the economic and political factors are investigated in the theoretical model. Then, the validity of results is tested by econometric analysis with a panel probit model. The data spans 25 key trade nations and covers the period of 2007, 2010 and 2013.

Findings

First, the FTA will be endorsed only if the aggregate welfare under FTA, combing lobby contributions with social welfare of both pair nations, is higher than the counterpart without FTA. Otherwise, FTA is rejected. Second, the possibility of concluding a FTA has positive correlation with pair nations’ market sizes and the number of countries with which they have both previously concluded FTAs; the possibility has negative correlation with the distance between pair nations; if pair nations’ aggregate market sizes are large enough, the possibility has positive correlation with government’s sensitivity to social welfare, otherwise the correlation is negative. Third, although FTAs are characterized by the regionalism, they will contribute to multilateral free trade in the long run.

Originality/value

Most researchers do not take the foreign lobbying into account in the manner or the detail that we do here when they study the determinants of FTAs. This paper shows the condition under which FTA is politically viable and incentives behind FTA.

Details

Journal of Chinese Economic and Foreign Trade Studies, vol. 7 no. 2
Type: Research Article
ISSN: 1754-4408

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Article
Publication date: 7 October 2019

Serkan Karadas, William McAndrew and Minh Tam Tammy Schlosky

The purpose of this study is to investigate the effect of corruption on stock returns in the USA. In particular, this study examines the relationship between corruption in…

Abstract

Purpose

The purpose of this study is to investigate the effect of corruption on stock returns in the USA. In particular, this study examines the relationship between corruption in a state (i.e. local corruption) and stock returns of firms headquartered in that state (i.e. local returns).

Design/methodology/approach

This paper uses the Fama–MacBeth two-step regressions. In the first step, the authors estimate the coefficients on the market, size, value and momentum factors for individual stocks. In the second step, they use those coefficients along with the corruption score of the state where stocks are headquartered to explain stock returns.

Findings

This paper finds that corruption in a state adversely affects stock returns of firms headquartered in that state. It further documents that the effect of corruption on stock returns is limited to geographically concentrated firms.

Originality/value

To the best of the authors’ knowledge, this paper is the first to document the effect of state-level corruption on individual stock returns in the USA using the Fama–MacBeth regressions. This study contributes to the literature by documenting the effect of local corruption on local stock returns in a low corruption country.

Details

Journal of Financial Crime, vol. 26 no. 4
Type: Research Article
ISSN: 1359-0790

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Article
Publication date: 8 May 2017

James Bailey and Douglas Webber

As of 2011, the average US state had 37 health insurance benefit mandates, laws requiring health insurance plans to cover a specific treatment, condition, provider, or…

Abstract

Purpose

As of 2011, the average US state had 37 health insurance benefit mandates, laws requiring health insurance plans to cover a specific treatment, condition, provider, or person. This number is a massive increase from less than one mandate per state in 1965, and the topic takes on a new significance now, when the federal government is considering many new mandates as part of the “essential health benefits” required by the Affordable Care Act. The paper aims to discuss these issues.

Design/methodology/approach

The authors use fixed effects estimation on 1996-2010 data to determine why some states pass more mandates than others.

Findings

The authors find that the political strength of health care providers is the strongest determinant of mandates.

Originality/value

A large body of literature has attempted to evaluate the effect of mandates on health, health insurance, and the labor market. However, previous papers did not consider the political processes behind the passage of mandates. In fact, when they estimate the laws’ effect, almost all papers on the subject assume that mandates are passed at random. The paper opens the way to estimating the causal effect of mandates on health insurance and the labor market using an instrumental variables strategy that incorporates political information about why mandates get passed.

Details

Journal of Economic Studies, vol. 44 no. 2
Type: Research Article
ISSN: 0144-3585

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