Search

Begin New Search Topic Economics Publication Year within 25 Years

4421. Parental Wealth Effects on Living Standards and Asset Holdings: Results from Chile

Author:
Florencia Torche and Seymour Spillerman
Publication Date:
11-2004
Content Type:
Working Paper
Institution:
Institute for Social and Economic Research and Policy at Columbia University
Abstract:
This paper examines aspects of the replication of inequality across generations and attempts to assess the extent to which parental resources influence the life chances and living standards of adult children. We expect household wealth to be a critical matter, especially in a society in which there is a weak public safety net or in which the credit market is inefficient. In the former case, families need to self-insure--accumulate savings to smooth consumption expenditures over periods of income fluctuation, such as might result from illness or job loss. In the latter case, financial wealth is necessary in order to finance large expenditure items (e.g., a home, a new business) or to provide collateral in seeking a bank loan for such an expenditure.
Topic:
Development, Economics, and Human Welfare
Political Geography:
South America

4422. Fresh Starts: School Form and Student Outcomes

Author:
Peter Bearman and Christopher Weiss
Publication Date:
10-2004
Content Type:
Working Paper
Institution:
Institute for Social and Economic Research and Policy at Columbia University
Abstract:
Seemingly endless tinkering and adjustment of the structure of education in the United States over the past century has led to the adoption of different school forms at different times. Currently the middle school is the dominant form of schooling for the middle years of education; however, the middle school is a relatively new form that replaced the junior high school, which itself replaced previous schooling forms. Despite the rhetoric of policymakers and practitioners, little research has considered what school forms work for what kinds of adolescents across what dimensions. In this article, we show that for both academic and non-academic outcomes, how school systems structure the transition from 8th to 9th grade makes almost no difference. Where differences appear, they are small and point to the benefits of school transitions for providing fresh starts to adolescents in socially difficult situations. The policy implications are correspondingly clear: the optimal school structure for any school district is the one that maximizes building space, reduces crowding, and achieves administrative rationality.
Topic:
Development, Economics, and Education
Political Geography:
United States

4423. Policymaking and Caseload Dynamics: Homeless Shelters

Author:
William McAllister
Publication Date:
08-2004
Content Type:
Working Paper
Institution:
Institute for Social and Economic Research and Policy at Columbia University
Abstract:
Many social problems can be understood as “conceptual caseloads”, e.g., people in poverty, and actual programmatic caseloads are a major, specific concern for policymakers and public administrators. Thus, a crucial and fairly general concern is how caseloads—whether conceptual or programmatic—can be reduced. To address this concern, officials often fall back on politically or intuitively attractive ideas—preventing people from entering caseloads, for example. Failure to incorporate caseload dynamics, however, may mean prevention and other caseload reduction policies will deliver much less than promised, and may cause caseloads to grow. In this paper, we first show how caseload size depends only on the number of entrants to a caseload and the rate at which people leave a caseload. With this framework in mind, we then address two common, seemingly appropriate policy responses: preventing entrants and hastening leaving. However, we show how too little is now known about homeless prevention to pin high hopes on its utility and that some social welfare problems, like homelessness, may be too inhospitable for prevention's logic. We then explain how allocating resources to hasten leaving is not as straightforward as policymakers have assumed but rather must recognize caseload dynamics to avoid unintended growth. We conclude by explaining some limits and opportunities in using caseload dynamics for policymaking.
Topic:
Conflict Resolution, Economics, Government, and Poverty

4424. Measuring Economic Disadvantage During Childhood: A Group-Based Modeling Approach

Author:
Mary Clare Lennon, Robert L. Wagmiller, Philip M. Alberti, and J. Lawrence Aber
Publication Date:
06-2004
Content Type:
Working Paper
Institution:
Institute for Social and Economic Research and Policy at Columbia University
Abstract:
Recent research suggest that child well-being and subsequent status attainment are influenced not only by the overall magnitude of exposure to family economic disadvantage during childhood, but also by the age of exposure and significant changes in family economic circumstances. Unfortunately, traditional measures of children's economic deprivation – such as, permanent and transitory income, persistent or cumulative poverty, and the number and length of poverty spells – fail to differentiate between exposure to disadvantage at different stages in childhood and largely ignore how family economic circumstances are changing over time. In this paper we propose a new method for assessing economic disadvantage during childhood that captures both children's overall levels of exposure to economic disadvantage and their patterns of exposure. This new method, which takes advantage of recent advances in finite mixture modeling, uses a longitudinal latent class model to classify children into a limited number of groups with similar histories of exposure to family economic disadvantage. Using this new methodology, group membership can be related to both family background characteristics and achievement in childhood and early adulthood, making it possible both to assess how family characteristics affect patterns of exposure to disadvantage during childhood and directly test alternative theories about the effect of different patterns of exposure on achievement. In this paper the relationship between background factors – such as race, parental education, and family structure – and group membership is investigated, as is the association between group membership and achievement in early adulthood. The use of this technique is demonstrated using data from the Panel Study of Income Dynamics (PSID).
Topic:
Conflict Resolution, Conflict Prevention, Development, and Economics

4425. Production Markets Broker Upstream to Downstream, balancing their volume and quality sensitivities to firms through an oriented market profile of signals

Author:
Harrison C. White
Publication Date:
04-2004
Content Type:
Working Paper
Institution:
Institute for Social and Economic Research and Policy at Columbia University
Abstract:
Varieties of quality competition across producers are extrapolated out of the two dual forms of perfect competition, oriented upstream and downstream. Only then are general, path-dependent solutions for market derived (which came first in the previous book of 2002). Attention is focused on advanced markets for high ratios of sensitivities between upstream and downstream relations of producers. Parameter identification and estimations identify impacts from substitutability with cross-stream markets as being major only for certain bands of sensitivity ratios, identified within the state space for production market contexts. Illustrative applications are sketched for strategic manipulations and investment decisions and trends in sectors.
Topic:
Economics, Emerging Markets, Industrial Policy, and International Trade and Finance

4426. Reducing Bias in Treatment Effect Estimation in Observational Studies Suffering from Missing Data

Author:
Jennifer Hill
Publication Date:
01-2004
Content Type:
Working Paper
Institution:
Institute for Social and Economic Research and Policy at Columbia University
Abstract:
Matching based on estimated propensity scores (that is, the estimated conditional probability of being treated) has become an increasingly popular technique for causal inference over the past decade. By balancing observed covariates, propensity score methods reduce the risk of confounding causal processes. Estimation of propensity scores in the complete data case is generally straightforward since it uses standard methods (e.g. logistic regression or discriminant analysis) and relies on diagnostics that are relatively easy to calculate and interpret. Most studies, however, have missing data. This paper illustrates a principled approach to handling missing data when estimating propensity scores makes use of multiple imputation (MI). Placing the problem within the framework of the Rubin Causal Model makes the assumptions explicit by illustrating the interaction between the treatment assignment mechanism and the missing data mechanism. Several approaches for estimating propensity scores with incomplete data using MI are presented. Results demonstrating improved efficacy compared with existing methodology are discussed. These advantages include greater bias reduction and increased facility in model choice.
Topic:
Conflict Resolution, Development, Economics, and Education

4427. International Diversification at Home and Abroad

Author:
Fang Cai and Francis E. Warnock
Publication Date:
12-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
We analyze foreigners' and domestic institutional investors' positions in U.S. equities. Controlling for many factors, we uncover a common preference for large firms and firms that are diversified internationally. The domestic preference for internationally diversified firms implies that investors might obtain substantial international diversification by investing at home. Using an international factor model, we show that exposure to foreign equity markets is indeed greater for domestic firms that are more diversified internationally, suggesting that at least some of the home-grown foreign exposure translates into international diversification benefits. After accounting for home-grown foreign exposure, the share of 'foreign' equities in investors' portfolios nearly doubles, reducing (but not eliminating) the observed home bias.
Topic:
International Relations, Development, Economics, and International Trade and Finance
Political Geography:
United States

4428. The High-Frequency Effects of U.S. Macroeconomic Data Releases on Prices and Trading Activity in the Global Interdealer Foreign Exchange Market

Author:
Jonathan H. Wright, Alain P. Chaboud, Edward Howorka, David Liu, Sergey Chernenko, and Raj S. Krishnasami Iyer
Publication Date:
11-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
We introduce a new high-frequency foreign exchange dataset from EBS (Electronic Broking Service) that includes trading volume in the global interdealer spot market, data not previously available to researchers. The data also gives live transactable quotes, rather than the indicative quotes that have been used in most previous high frequency foreign exchange analysis. We describe intraday volume and volatility patterns in euro-dollar and dollar-yen trading. We study the effects of scheduled U.S. macroeconomic data releases, first confirming the finding of recent literature that the conditional mean of the exchange rate responds very quickly to the unexpected component of data releases. We next study the effects of data releases on trading volumes. News releases cause volume to rise, and to remain elevated for a longer period. However, in contrast to the result for the level of the exchange rate, even if the data release is entirely in line with expectations, we find that there is still typically a large pickup in trading volume.
Topic:
Economics, Emerging Markets, and International Trade and Finance
Political Geography:
United States

4429. Growth-Led Exports: Is Variety the Spice of Trade?

Author:
Joseph E. Gagnon
Publication Date:
11-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
Fast-growing countries tend to experience rapid export growth with little secular change in their terms of trade. This contradicts the standard Armington trade model, which predicts that fast-growing countries can experience rapid export growth only to the extent that they accept declining terms of trade. This paper generalizes the monopolistic competition trade model of Helpman and Krugman (1985), providing a basis for growth-led exports without declining terms of trade. The key mechanism behind this result is that fast-growing countries are able to develop new varieties of products that can be exported without pushing down the prices of existing products. There is strong support for the new model in long-run export growth of many countries in the post-war era.
Topic:
Economics, Emerging Markets, and International Trade and Finance
Political Geography:
United States

4430. Can Long-Run Restrictions Identify Technology Shocks?

Author:
Luca Guerrieri, Christopher Gust, and Christopher J. Erceg
Publication Date:
10-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
Gali's innovative approach of imposing long-run restrictions on a vector autoregression (VAR) to identify the effects of a technology shock has become widely utilized. In this paper, we investigate its reliability through Monte Carlo simulations using calibrated business cycle models. We find it encouraging that the impulse responses derived from applying the Gali methodology to the artificial data generally have the same sign and qualitative pattern as the true responses. However, we find considerable estimation uncertainty about the quantitative impact of a technology shock on macroeconomic variables, and little precision in estimating the contribution of technology shocks to business cycle fluctuations. More generally, our analysis emphasizes that the conditions under which the methodology performs well appear considerably more restrictive than implied by the key identifying assumption, and depend on model structure, the nature of the underlying shocks, and variable selection in the VAR. This cautions against interpreting responses derived from this approach as model-independent stylized.
Topic:
Conflict Resolution, Economics, International Trade and Finance, and Science and Technology