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1 – 10 of over 20000Yinao Wang, Aiqing Ruan and Zhihui Zhan
This paper aims to study the improved effect of the instrumental variable method to estimate parameters of linear regression model with the stochastic explanatory variables…
Abstract
Purpose
This paper aims to study the improved effect of the instrumental variable method to estimate parameters of linear regression model with the stochastic explanatory variables problem.
Design/methodology/approach
By Monte‐Carlo method, taking a linear regression model with intercept of 3, slope of 4 as an example, whose random error in standard normal distribution, to test whether parameter estimators are biased and how about the average relative error of estimator of slope when random explanatory variables are in different contemporaneously correlated with random error item. By the instrumental variables which are independent with random error item and in varying degrees related to random explanatory variable, the study tests the estimation accuracy of the slope using the instrumental variable method.
Findings
This paper tests that the ordinary least square parameter estimators are biased, and especially that the average relative error of estimator of slope is significantly large, more than 10 percent, when random explanatory variables are different and contemporaneously correlated with the random error item. For the instrumental variables that are independent from random error item and in varying degrees related to the random explanatory variable, the estimation accuracy of the slope is significantly improved and the relative error dropped to less than 4 percent, but the estimation accuracy of the intercept term showed no significant improvement by the instrumental variable method.
Practical implications
The method exposed in the paper shows how to improve estimation by an instrumental variable method.
Originality/value
The paper succeeds in showing how to improve estimation by the instrumental variable method of numerical simulation.
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The purpose of this paper is to identify if peer firms’ capital structure decision plays a role in determining focal firms’ capital structure decision, despite the fact that…
Abstract
Purpose
The purpose of this paper is to identify if peer firms’ capital structure decision plays a role in determining focal firms’ capital structure decision, despite the fact that correlated effects can also lead to co-movement of financing behavior among firms from the same industry (i.e. industry-specific capital structure).
Design/methodology/approach
Instead of using relative measurement (of individual outcome variable over industry variable) as in previous work, this paper borrows the linear-in-means model and, after controlling for potential endogeneity problems, directly identifies the existence of peer effects with coefficient estimation. To deal with correlated effects, additional empirical investigations such as test of heterogeneity in direction and scale, social multiplier identification test and instrumental regression test based on another instrumental variable (that is less influenced by correlated effects) are performed.
Findings
Using data from Chinese listed firms, this paper, for the first time, identifies the presence of peer effects in capital structure and debt maturity decision. Further investigations show that first, focal firms react asymmetrically to peer firms’ debt adjustment of different direction and scale. Second, social multiplier, a unique attribute of peer effects, is identified in the leverage choices. Third, the significant correlation of capital structure decision remains even if we use another “correlated effects-immune” instrument. All these results point to the fact that peer effects, rather than correlated effects, play a significant role in determining capital structure.
Practical implications
The empirical results of this paper provide strong evidence that firms, driven by motivations such as either learning or competition, will actively react to peers’ financial decisions. As the bridge between individual firms and the industry, social multiplier can be fully taken advantage of to induce positive spillover of good management practices and prohibit inefficient decisions from spreading.
Originality/value
This paper theoretically and empirically introduces peer effects – a well-acknowledged social concept – into capital structure decision of Chinese listed firms, thus both complementing the traditional capital structure theory and providing an empirical paradigm for peer effects research.
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Darryl L. Chambers, Yasser A. Payne and Ivan Sun
While the past few decades have witnessed a substantial number of studies on public attitudes toward the police, a relatively thin line of inquiry has focused exclusively on low…
Abstract
Purpose
While the past few decades have witnessed a substantial number of studies on public attitudes toward the police, a relatively thin line of inquiry has focused exclusively on low income urban Black-Americans, and especially street-identified Black populations. The purpose of this paper, however, is to examine trust in police amongst street-identified Black men and women.
Design/methodology/approach
Relying on a street participatory action research methodological approach, the authors collected survey data (N = 520) from two low-income unban Black neighborhoods, to examine the effects of an instrumental model versus an expressive model on procedural- and outcome-based trust in police.
Findings
The findings suggested a community sample of street-identified Black men and women were able to differentiate between procedural- and outcome-based trust. The instrumental model was better in predicting procedural-based trust in police, while the expressive model accounted better for outcome-based trust in police.
Research limitations/implications
Implications for street participatory action research methodology, future research and policy are also discussed.
Originality/value
This paper is an original manuscript.
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Jack K. Ito, Céleste M. Brotheridge and Kathie McFarland
The aim of this paper is to address three broad questions: Are preferences for branding attributes similar for entry and for retention? Are there generational and career stage…
Abstract
Purpose
The aim of this paper is to address three broad questions: Are preferences for branding attributes similar for entry and for retention? Are there generational and career stage differences in one's entry and exit priorities? How is current satisfaction with brand image attributes related to overall commitment, satisfaction and retention?
Design/methodology/approach
This paper reports on the results of a survey of 144 workers employed at 37 day care centers in a medium sized Canadian city.
Findings
Although the level of respondents' priorities for entry and exit differed, most priorities remained in the same order. However, their perspectives were more disaggregated for entry than for exit, where branding attributes were more strongly correlated. Consistent with the exploration stage of career development, younger people planned to stay a shorter length of time with a particular center.
Research limitations/implications
This study includes only child care workers in a small geographic region. Future research should be undertaken in larger scale firms that also offer greater heterogeneity in professions as well as career options. Also, a longitudinal study that follows new entrants for several years, using both instrumental and symbolic measures, would provide information on what attracted individuals and what influenced their intention to leave.
Practical implications
Although there were few differences by age or career stage, the variation within each factor suggests that a brand image may need to be relatively broad to accommodate diversity. HR practitioners can use the practice symbolic pattern to build and maintain a culture that is attractive to present and prospective employees. The opposite symbolic practice pattern may help current employees understand reasons for new practices.
Originality/value
Organizations face significant challenges in designing programs for recruitment and retention. This study considers how employees' to two questions – “why do people enter the organization” and “why do people remain?” – may differ.
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The present research aimed to develop and test cognitive processes through which instrumental leadership leads to creativity via problem-solving rumination and knowledge sharing…
Abstract
Purpose
The present research aimed to develop and test cognitive processes through which instrumental leadership leads to creativity via problem-solving rumination and knowledge sharing with coworkers, based on the self-regulatory perspective of goal progress theory.
Design/methodology/approach
Data were collected from 166 male construction workers (nested within 19 male leaders) who completed the total of 1,642 daily diary questionnaires. Further, a group-mean centering approach and several control variables were used in order to improve causal inferences of the results.
Findings
It was found that instrumental leadership predicts problem-solving rumination (an intrapersonal self-regulatory process) and knowledge sharing with coworkers (an interpersonal self-regulatory process), which, in turn, result in creativity.
Originality/value
In addition to motivational processes that explain the relationships between several leadership styles and creativity, the current research found a crucial role of instrumental leadership in predicting creativity.
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R. Kelley Pace, James P. LeSage and Shuang Zhu
Most spatial econometrics work focuses on spatial dependence in the regressand or disturbances. However, Lesage and Pace (2009) as well as Pace and LeSage2009 showed that the bias…
Abstract
Most spatial econometrics work focuses on spatial dependence in the regressand or disturbances. However, Lesage and Pace (2009) as well as Pace and LeSage2009 showed that the bias in β from applying OLS to a regressand generated from a spatial autoregressive process was exacerbated by spatial dependence in the regressor. Also, the marginal likelihood function or restricted maximum likelihood (REML) function includes a determinant term involving the regressors. Therefore, high dependence in the regressor may affect the likelihood through this term. In addition, Bowden and Turkington (1984) showed that regressor temporal autocorrelation had a non-monotonic effect on instrumental variable estimators.
We provide empirical evidence that many common economic variables used as regressors (e.g., income, race, and employment) exhibit high levels of spatial dependence. Based on this observation, we conduct a Monte Carlo study of maximum likelihood (ML), REML and two instrumental variable specifications for spatial autoregressive (SAR) and spatial Durbin models (SDM) in the presence of spatially correlated regressors.
Findings indicate that as spatial dependence in the regressor rises, REML outperforms ML and that performance of the instrumental variable methods suffer. The combination of correlated regressors and the SDM specification provides a challenging environment for instrumental variable techniques.
We also examine estimates of marginal effects and show that these behave better than estimates of the underlying model parameters used to construct marginal effects estimates. Suggestions for improving design of Monte Carlo experiments are provided.
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Cheti Nicoletti, Kjell G. Salvanes and Emma Tominey
We estimate the parental investment response to the child endowment at birth, by analysing the effect of child birth weight on the hours worked by the mother two years after…
Abstract
We estimate the parental investment response to the child endowment at birth, by analysing the effect of child birth weight on the hours worked by the mother two years after birth. Mother’s working hours soon after child birth are a measure of investments in their children as a decrease (increase) in hours raises (lowers) her time investment in the child. The child birth endowment is endogenously determined in part by unobserved traits of parents, such as investments during pregnancy. We adopt an instrumental variables estimation. Our instrumental variables are measures of the father’s health endowment at birth, which drive child birth weight through genetic transmission but does not affect directly the mother’s postnatal investments, conditional on maternal and paternal human capital and prenatal investments. We find an inverted U-shape relationship between mothers worked hours and birth weight, suggesting that both low and extremely high child birth weight are associated with child health issues for which mothers compensate by reducing their labour supply. The mother’s compensating response to child birth weight seems slightly attenuated for second and later born children. Our study contributes to the literature on the response of parental investments to child’s health at birth by proposing new and more credible instrumental variables for the child health endowment at birth and allowing for a heterogeneous response of the mother’s investment for first born and later born children.
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Kata Orosz, Viorel Proteasa and Daniela Crăciun
Higher education researchers are often challenged by the difficulty of empirically validating causal links posited by theories or inferred from correlational observations. The…
Abstract
Higher education researchers are often challenged by the difficulty of empirically validating causal links posited by theories or inferred from correlational observations. The instrumental variable (IV) estimation strategy is one approach that researchers can use to estimate the causal impact of various higher education–related interventions. In this chapter, we discuss how the body of quantitative research specifically devoted to higher education has made use of the IV estimation strategy: we describe how this estimation strategy was used to address causality concerns and provide examples of the types of IVs that were used in various subfields of higher education research. Our discussion is based on a systematic review of a corpus of econometric studies on higher education–related issues that spans the last 30 years. The chapter concludes with a critical discussion of the use of IVs in quantitative higher education research and a discussion of good practices when using an IV estimation strategy.
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The purpose of this paper is to investigate the correlation and mechanism between international students and inbound tourism.
Abstract
Purpose
The purpose of this paper is to investigate the correlation and mechanism between international students and inbound tourism.
Design/methodology/approach
Taking 269 prefecture-level cities in China as a sample, bringing international students and inbound tourism into the same analytical framework, the paper applies the fixed-effects model, instrumental variables model and mediating effects model to investigate the impact of international students on inbound tourism.
Findings
International students significantly contribute to the increase in inbound tourists and tourism revenue in China, which remain valid after a series of robustness tests. When the relocation data of Chinese urban universities and faculties in the 1950s are used as an instrumental variable for the potential endogenous problems of international students, the results are still valid. Heterogeneity research shows that the impact of international students on inbound tourism has heterogeneous effects in different regions. In addition, the mechanism analysis shows that international students promote China’s inbound tourism mainly through two channels: the economic growth effect and the human capital effect.
Research limitations/implications
This paper provides evidence of the correlation between international students and inbound tourism in developing countries. However, as the data for the study are all from China, caution should be taken when applying the findings of this paper to other regions.
Practical implications
This paper provides evidence on the causal relationship between international students and inbound tourism in developing countries. However, as the data for the study are all from China, caution should be taken when applying the findings of this paper to other regions.
Social implications
This paper creatively finds out the instrumental variables of international students with academic education to deal with the potential endogenous problems, and then identifies the causal relationship between international students and inbound tourism.
Originality/value
This paper creatively finds out the instrumental variables of international students to deal with the potential endogenous problems and then identifies the correlation between international students and inbound tourism.
目的
本文将研究样本扩大到中国266个地级市, 将留学生和入境旅游纳入同一分析框架, 从游客规模和旅游收入两个方面衡量入境旅游规模, 并调查留学生对入境旅游规模的影响及其机制。
设计/方法/途径
本文通过使用面板数据的固定效应模型、工具变量和的中介效应, 考察国际学生与入境旅游之间的因果关系。
结果
留学生显著促进了中国入境旅游收入和游客数量的增长, 经过一系列稳健测试后, 上述结果仍然成立; 以20世纪50年代中国城市高校和院系的搬迁数据作为国际学生应对潜在内生性问题的工具变量, 结果仍然有效; 异质性研究表明, 留学生入境旅游效应在不同的时间和地区具有异质性; 在机制分析中, 留学生促进中国入境旅游主要通过三个渠道:经济增长效应、人力资本效应和外商投资效应。
研究局限/启示
本文为发展中国家提供了国际学生与入境旅游之间因果关系的证据。但由于研究数据均来自中国, 将本文的研究结果应用于其他地区时需谨慎。
实践应用
本文为发展中国家提供了国际学生与入境旅游之间因果关系的证据。但由于研究数据均来自中国, 将本文的研究结果应用于其他地区时需谨慎。
社会启示
本文创造性地找出留学生学历教育的工具变量以应对潜在的内生性问题, 进而识别留学生与入境旅游之间的因果关系。
原创性/价值
本文创造性地找出留学生学历教育的工具变量以应对潜在的内生性问题, 进而识别留学生与入境旅游之间的因果关系。
Diseño/metodología/enfoque (límite 100 palabras)
Tomando como muestra 266 ciudades de China a nivel de prefectura, e integrando a los estudiantes internacionales y el turismo receptor en el mismo marco analítico, el documento aplica el modelo de efectos fijos, el modelo de variables instrumentales y el modelo de efectos mediadores para investigar el impacto de los estudiantes internacionales en el turismo receptor.
Objetivo (límite 100 palabras)
El propósito de este documento es investigar la relación causal y el mecanismo entre los estudiantes internacionales y el turismo receptor.
Resultados (límite 100 palabras)
Los estudiantes internacionales contribuyen significativamente al aumento de los turistas entrantes y de los ingresos por turismo en China, que siguen siendo válidos tras una serie de pruebas de solidez. Cuando utilizamos los datos de reubicación de las universidades y facultades urbanas chinas en la década de 1950 como variable instrumental para los posibles problemas endógenos de los estudiantes internacionales, los resultados siguen siendo válidos. La investigación de la heterogeneidad muestra que el impacto de los estudiantes internacionales en el turismo receptor tiene efectos heterogéneos en las distintas regiones. Además, el análisis del mecanismo muestra que los estudiantes internacionales promueven el turismo receptor de China principalmente a través de tres canales: el efecto del crecimiento económico, el efecto del capital humano y el efecto de la inversión extranjera.
Limitaciones/implicaciones de la investigación (límite 100 palabras)
Este trabajo aporta pruebas sobre la relación causal entre los estudiantes internacionales y el turismo receptor en los países en desarrollo. Sin embargo, como todos los datos del estudio proceden de China, hay que ser prudentes a la hora de aplicar los resultados de este trabajo a otras regiones.
Implicaciones prácticas (límite 100 palabras)
Este documento aporta pruebas sobre la relación causal entre los estudiantes internacionales y el turismo receptor en los países en desarrollo. Sin embargo, dado que todos los datos del estudio proceden de China, debe tenerse precaución a la hora de aplicar los resultados de este documento a otras regiones.
Implicaciones sociales (límite 100 palabras)
Este trabajo descubre de forma creativa las variables instrumentales de los estudiantes internacionales con formación académica para hacer frente a los posibles problemas endógenos y, a continuación, identifica la relación causal entre los estudiantes internacionales y el turismo receptor.
Originalidad/valor (límite 100 palabras)
Este trabajo descubre de forma creativa las variables instrumentales de los estudiantes internacionales para tratar los posibles problemas endógenos, y luego identifica la relación causal entre los estudiantes internacionales y el turismo receptor.
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Carolina Pasciaroni and Andrea Barbero
This paper aims to analyse the influence of cooperation on the degree of novelty of technological innovations introduced by industrial firms in Argentina. This influence is…
Abstract
Purpose
This paper aims to analyse the influence of cooperation on the degree of novelty of technological innovations introduced by industrial firms in Argentina. This influence is analysed from three perspectives: cooperation by partner type [business partners or scientific and technological centres (S&T) partners]; cooperation by number of partner types, from no cooperation to cooperation with two partner types; and cooperation by goals pursued by firms.
Design/methodology/approach
The data come from one of the last national innovation surveys conducted in Argentina. The study controls for endogeneity, using instrumental variable procedures within the conditional mixed-process (CMP) framework.
Findings
The main result is the influence of cooperation with universities and S&T centres on the introduction of more novel innovations, which was found both in estimations with and without endogeneity correction. This influence was verified for more complex goals (R&D, technology transfer and industrial design and engineering) as well as for less complex ones (tests and trials, human resources training, quality management and certification). Business cooperation seems to impact only on a lower degree of novelty for more complex goals. The increase in the number of partners that the firm cooperates with, from no cooperation to joint cooperation with two partner types, influences more novel innovations.
Research limitations/implications
Limitations and proposals for future research are discussed at the end of the study.
Practical implications
The results of this study contrast with the high propensity to cooperate with business partners shown by firms in Argentina and other Latin American countries. Therefore, this paper may help formulate more effective policies to promote cooperation conducive to firm innovation performance. Limitations and proposals for future research are discussed at the end of the study.
Originality/value
Although there is empirical evidence on this topic for developed countries, firm-level studies on cooperation and degree of novelty are scarce for Latin America. In addition, this paper analyses cooperation not only by type of partner but also by type of goal. This study attempted to control for endogeneity by using instrumental variables within the CMP framework.
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