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212. Impact of Public R Financing on Private R Does Financial Constraint Matter?
- Author:
- Jyrki Ali-Yrkkö
- Publication Date:
- 02-2005
- Content Type:
- Working Paper
- Institution:
- Centre for European Policy Studies
- Abstract:
- This study analyses how public R financing impacts companies. Our main goal is to study whether public and private R financing are substitutes or complements, and whether this impact differs between financially constrained and unconstrained companies. Our company-level panel data cover the period from 1996 to 2002. The statistical method employed in the research takes into account the possibility that receiving public support may be an endogenous factor. Our results suggest that public R financing does not crowd out privately financed R Instead, receiving a positive decision to obtain public R funds increases privately financed R Furthermore, our results suggest that this additionality effect is bigger in large firms than in small firms.
- Topic:
- Emerging Markets and Industrial Policy
- Political Geography:
- Europe
213. Government and the Economy: The World Wars
- Author:
- Robert Higgs
- Publication Date:
- 04-2005
- Content Type:
- Working Paper
- Institution:
- Independent Institute
- Abstract:
- U.S participation in the world wars gave rise to massive increases in the extent of government involvement in economic life and brought about many important, enduring changes in the government\'s relations with private economic actors. In both wars, the federal government expanded enormously the amount of its expenditure, taxation, and regulation as well as its direct participation in productive activities, creating what contemporaries described during World War I as "war socialism." Each of these great experiences left a multitude of legacies—fiscal, institutional, and ideological—many of which continue to shape the country\'s political economy. As William Graham Sumner wisely observed, "it is not possible to experiment with a society and just drop the experiment whenever we choose. The experiment enters into the life of the society and never can be got out again" (Sumner 1934, II, 473). The world wars certainly are among the greatest "experiments" that American society ever endured.
- Topic:
- Economics, Government, and Industrial Policy
- Political Geography:
- United States
214. Is Cybersecurity a Public Good? Evidence from the Financial Services Industry
- Author:
- Benjamin Powell
- Publication Date:
- 03-2005
- Content Type:
- Working Paper
- Institution:
- Independent Institute
- Abstract:
- The September 11, 2001, terrorist attacks on the United States heightened concerns about vulnerabilities to future attacks. One new area of concern is cyberterrorism: the possibility of terrorists using computers to attack our critical infrastructure electronically. The government has made efforts to better secure its own computer networks to prevent terrorists from hacking into computer systems in the Pentagon, FBI, and other government agencies. Increasingly, however, the government has been concerned that the private sector is vulnerable to cyberterrorism. The private sector owns approximately 85 percent of the critical infrastructure in the U.S. (Deloitte 2004 p. 15). There are concerns that a cyber attack on dams, trains, electrical grids, pipeline pumps, communications networks, or the financial services industry could cause significant physical or economic damage to the U.S. The policy question being asked is whether private businesses, when left to their own devices, provide enough cybersecurity or if some form of government involvement is justified.
- Topic:
- International Relations, Development, Industrial Policy, and Science and Technology
- Political Geography:
- United States and United Nations
215. The German ICT industry: Spatial Employment and Innovation Patterns
- Author:
- Björn Frank and Per Botolf Maurseth
- Publication Date:
- 02-2005
- Content Type:
- Working Paper
- Institution:
- Norwegian Institute of International Affairs
- Abstract:
- This paper documents recent developments in German ICT industries. In particular we report results on spatial patterns in innovation and employment in these industries. The paper is motivated by previous studies that have found that ICT industries seem to cluster geographically and having spatially clustered growth rates. In this study, we discriminate between production of ICT devices and production of ICT services. In Germany, production of ICT devices is concentrated in clusters of innovating regions (in terms of patents). ICT service production, on the other hand, is concentrated in larger urban areas. Growth rates in ICT-related employment show different spatial patterns. The data show that negative spatial effects are present for several sectors, which might give support for the so-called backwash effect described by Gunnar Myrdal (1957). For other sectors, positive spatial spillover effects may be present. For overall economic development (in terms of gross regional product per habitant) we find weak positive growth effects ICT, but these growth effects stem more from innovation than from production or use of ICT.
- Topic:
- Economics, Human Welfare, and Industrial Policy
- Political Geography:
- Europe and Germany
216. Preserving Competition: Keeping Predators at Bay
- Publication Date:
- 12-2005
- Content Type:
- Policy Brief
- Institution:
- The Organisation for Economic Co-operation and Development
- Abstract:
- Predatory pricing is the practice of offering goods or services at exceptionally low prices, thereby forfeiting some profit in order to drive competitors out of the market, discipline them, and/or deter entry. It is among the most frequently discussed topics in competition law and economics.
- Topic:
- Economics, Government, Industrial Policy, and Markets
217. Intellectual property and competition policy in the biotechnology industry
- Publication Date:
- 06-2005
- Content Type:
- Policy Brief
- Institution:
- The Organisation for Economic Co-operation and Development
- Abstract:
- The science of biotechnology has been pushing the frontiers of human knowledge and intellectual property (“IP”) for three decades. As scientists developed techniques for isolating and creating genetic material and began to apply them commercially, a new industry grew and so did its appetite for patent protection. Although the wisdom of granting patents on DNA is still debated, the policy of OECD countries to allow such patents has been fairly well settled for some time. The door was therefore open for biotechnological innovators to create a flood of IP, and they did
- Topic:
- Economics, Environment, Industrial Policy, and Science and Technology
218. Quantity Discounts from Risk Averse Sellers
- Author:
- Patrick J. DeGraba
- Publication Date:
- 05-2005
- Content Type:
- Working Paper
- Institution:
- Board of Governors of the Federal Reserve System
- Abstract:
- It is widely believed that larger customers in a market can secure lower prices than smaller customers. This paper presents conditions under which risk averse sellers, who can distinguish larger customers from smaller customers, but who cannot observe customers' valuations, have an incentive to offer lower prices to larger customers. The intuition is that a single customer that demands a specific quantity represents a riskier profit source than multiple customers with independent valuations whose demands sum to that same quantity. Sellers respond to the riskier profit source by offering a lower price to reduce some of the risk.
- Topic:
- Economics, Emerging Markets, Industrial Policy, and International Trade and Finance
219. A Flexible Finite-Horizon Identification of Technology Shocks
- Author:
- Neville Francis, Michael T. Owyang, and Jennifer T. Roush
- Publication Date:
- 04-2005
- Content Type:
- Working Paper
- Institution:
- Board of Governors of the Federal Reserve System
- Abstract:
- Recent empirical studies using infinite horizon long-run restrictions question the validity of the technology-driven real business cycle hypothesis. These results have met with their own controversy, stemming from their sensitivity to changes in model specification and the general poor performance of long run restrictions in Monte Carlo experiments. We propose a alternative identification that maximizes the contribution of technology shocks to the forecast error variance of labor productivity at a long, but finite horizon. In small samples, our identification outperforms its infinite horizon counterpart by producing less biased impulse responses and technology shocks that are more highly correlated with the technology shocks from the underlying model. For U.S. data, we show that the negative hours response is not robust to allowing a greater role for non-technology shocks in the forecast error variance share at a ten year horizon.
- Topic:
- Development, Industrial Policy, International Trade and Finance, and Science and Technology
- Political Geography:
- United States
220. Exchange Rate Pass-through to U.S. Import Prices: Some New Evidence
- Author:
- Jaime Marquez, Mario Marazzi, Nathan Sheets, Joseph Gagnon, Robert J. Vigfusson, Jon Faust, Robert F. Martin, Trevor Reeve, and John Rogers
- Publication Date:
- 04-2005
- Content Type:
- Working Paper
- Institution:
- Board of Governors of the Federal Reserve System
- Abstract:
- This paper documents a sustained decline in exchange rate pass-through to U.S. import prices, from above 0.5 during the 1980s to somewhere in the neighborhood of 0.2 during the last decade. This decline in the pass-through coefficient is robust to the measure of foreign prices that is included in the regression (i.e., CPI versus PPI), whether the estimation is done in levels or differences, and whether U.S. prices are included as an explanatory variable. Notably, the largest estimates of pass-through are obtained when commodity prices are excluded from the regression. In this case, the pass-through coefficient captures both the direct effect of the exchange rate on import prices and an indirect effect operating through changes in commodity prices. Our work indicates that an increasing share of exchange rate pass-through has occurred through this commodity-price channel in recent years. While the source of the decline in passthrough is difficult to pin down with certainty, our work points to several factors, including the reduced share of (commodity-intensive) industrial supplies in U.S. imports and the increased presence of Chinese exporters in U.S. markets. We detect a particular step down in the passthrough coefficient around the time of the Asian financial crisis and document a shift in the export pricing behavior of emerging Asian firms around that time.
- Topic:
- Economics, Industrial Policy, and International Trade and Finance
- Political Geography:
- United States and China