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Recent and detailed data point to a polarization of wages with regard to the distribution of skills, particularly in developed countries over the past three decades, requiring the literature to address modelling approaches focused on automating different types of tasks. In the DTC literature, the technological-knowledge bias leads to an increase in the wage of skilled workers relative to unskilled workers. Motivated by this literature, this paper considers three types of workers (skilled, medium-skilled and unskilled) but retain the economic mechanisms that produce the results. Thus, wage inequality continues to result from the technological-knowledge bias, which, in the face of automation dynamics, reveals that medium-skilled workers are the relatively most penalized, generating wage polarization. Furthermore, as in the directed technical change literature, the relative supply of skilled workers continues to affect the skill premium. [ABSTRACT FROM AUTHOR]

Recent sluggish economic growth in developed countries has become a cause for concern regarding the long-term sustainability of the global economy. Continuous declines in the total fertility rate (TFR) constitute an essential factor in stagnant economic growth in developed countries. In this paper, we utilize fixed and random effect models to examine the relationships of TFR with putative TFR determinants in G7 countries from 1980 to 2020. Our findings support the societal response hypothesis wherein the relationship between TFR and female labour force participation rate (FLFPR) is posited to be stable and positive. Furthermore, the present study confirms a positive relationship of crude marriage rate (CMR) and market childcare availability (MktCC) with TFR. A negative relationship between the ageing population (AGE) and TFR was observed, consistent with broad concerns regarding the impending economic impacts of population ageing in developed countries. [ABSTRACT FROM AUTHOR]

Existing studies that explore the effects of education on health primarily focused on developed countries, and the extent to which education impacts health is still highly debated. This paper studies the causal effects of education on health in the largest developing country-China. We use 1977 Resuming College Entrance Exam Policy as an IV and find that education has little impact on health in general, while our findings suggest that people with higher education are more likely to be diagnosed with hypertension. We also test some possible mechanisms through which education might affect health, including smoking, drinking, exercise, and cognition. Majorities of these estimations provide no evidence that education would impact health behaviors or cognitive abilities. However, we find that higher-educated men are more likely to drink more and exercise less. [ABSTRACT FROM AUTHOR]

Much effort has been devoted to exploring the effect of bank competition on economic growth and stability. This paper shifts the focus towards the unemployment outcome. Using the Boone and Lerner indicators as well as bank concentration ratios, it finds, in a panel of developing and developed countries, that unemployment declines with bank competition up to a certain level of bank competition, above which it rises with bank competition. The impact seems to operate through investment and self-employment. The data thus suggest that there exists an optimal bank competition level that minimizes unemployment and too less and too much competition in a banking sector is detrimental to unemployment as it impedes capital accumulation and entrepreneurship development. [ABSTRACT FROM AUTHOR]

This paper investigates nonlinearities in the dynamics of real exchange rates. We use Monte Carlo simulations to establish the size properties of the Teräsvirta-Anderson test, when the dynamics of the real exchange rate is influenced by an exogenous process. In addition, we show that a modified nonlinearity test, which includes additional right-hand-side variables, performs much better than the original in both Monte Carlo exercises and in the actual data on 1431 bilateral real exchange rate series. Finally, we investigate the dynamics of the real exchange rate for both developed and developing countries using the modified test for the recent floating period. In general, the results find a greater incidence of nonlinear dynamics for developing country real exchange rates. [ABSTRACT FROM AUTHOR]

The primary emphasis of this paper is on seeking some justification for the worldwide phenomenon of increasing government involvement in health-care. The disability-adjusted-health-expectancy (DALE) rankings of countries in the World Health Report, 2000, ranked wealthier countries, with a typically large public sector involvement in health-care, higher on the list. Contrary to the possible implications for this ranking, this paper finds that the comparatively higher DALE in wealthier countries is not a result of greater public health expenditures. In the middle income and less developed countries, however, there is some evidence of effective public involvement in health-care. [ABSTRACT FROM AUTHOR]

Domestic savings and investment are positively correlated across countries and through time, as first suggested by Feldstein and Horioka (1980). However, whether this long-lasting correlation implies causation is still an open question. In this paper, we use instrumental variables in a panel setting and show that domestic savings do cause investment in developing economies. In contrast, for advanced countries the statistically significant correlation found in the data seems to result from endogeneity bias. Our identification strategy relies on the idea that age structure influences savings, but not total investment directly. Time-series data patterns for the United States and the theory of Direct Technological Change lend credence to our exclusion restriction. [ABSTRACT FROM AUTHOR]

This paper investigates the relationship between government size and economic growth and determines the optimal level of government spending to maximize economic growth. The paper applies a dynamic panel data analysis based upon a threshold model to test the threshold effect of government spending in 26 transition economies over the period spanning 1993-2016. According to the analysis results, government expenditures have a threshold effect on economic growth, and there is a non-linear relationship depicted as an Armey curve in these transition economies. The findings indicate that a government size above the threshold government spending level adversely affects economic growth, while a government size below the threshold level has a positive effect. Furthermore, there is a statistically significant relationship between the two variables above and below that optimal level, even if we divide the sample into developed and developing countries. Our findings suggest that governments in transition economies should consider optimal government size at around the estimated threshold level to support sustainable economic growth. [ABSTRACT FROM AUTHOR]

This study explores organization capital and its spillover effects among Chinese manufacturing firms. By linking patent data with China's annual survey of industrial enterprises database, we examine technological proximity as one potential channel for organizational spillover but find weak evidence. This result is consistent with previous findings from developed countries. In contrast, organization capital is found to generate positive spillover in China when geographical proximity is considered. In other words, it is found that spillover from organization capital is likely among Chinese firms due to geographical proximity rather than technological proximity. [ABSTRACT FROM AUTHOR]

This paper examines the immigration-trade links for OECD countries for the 2000–2015 period. By decomposing the overall effect of the presence of immigrants on the export of the hosting countries according to the methodology proposed by Hummels and Klenow (2005), we investigate if there is a migration-driven increase in the number of export relationships (extensive margin) and/or simply a growth of pre-existing export relationships (intensive margin) decomposed by an increase in quantity and price. We consider the country of origin of immigrants and their level(s) of education. Our results confirm the existence of a pro-export effect of immigrants attributable to the contribution of international networks regarding the reduction in information costs, which is especially strong for developed countries as sources of migration. However, when we look at the heterogeneous impact of different levels of immigrants' education, we find that the pro-trade effect is due to the contribution of less- and more educated immigrants to the reduction of trade costs, while the medium educated do not spur bilateral trade significantly. We address the potential endogeneity problems by adopting an instrumental variable (IV) approach based on shift-share IV and pull-and-push factors that could induce international migration. [ABSTRACT FROM AUTHOR]

In this paper, we empirically test the convergence of income and energy intensity for 61 countries using an augmented spatial growth model that includes energy and urbanization variables. We test an income convergence model to understand how energy use affects economic growth, and reveal that developing countries have energy constraints on their economic development. We show that energy is an essential component of economic growth in the early stages of development and that energy intensity converges between countries. It is consistent with the OLS estimation results that the convergence rate of energy intensity in developing countries of the spatial panel data model is still higher than in developed countries. However, the spatial panel data model shows that the gap between the two convergence rates is narrowed when spatial dependence is included. This implies that a country's steady state is influenced by the neighbouring countries and emphasizes the importance of international cooperation policies for reducing energy intensity. Since the effects of economic variables on the reduction of energy intensity are different in developed and developing countries, a country-specific energy policy rather than an internationally uniform policy is required. [ABSTRACT FROM AUTHOR]

While the extant literature shows that various indices of economic freedom display a positive relationship with the level of income inequality, it is unclear who are the winners and, in particular, the losers. For this reason, an analysis based on deciles and top percentiles helps to deepen the understanding of this issue. Starting from this consideration, the paper adds new evidence on the relation between economic freedom and income distribution by analysing a panel of 70 developing and developed countries for the period 1980–2014. The effects of economic freedom on income shares by deciles and top percentiles are estimated through an instrumental-variable approach ruling out potential reverse causality. Results show that economic freedom increases the income shares of the percentiles included in the top decile, eroding the income of the middle and, especially, upper-middle segments. The poor, instead, appear to be unaffected. [ABSTRACT FROM AUTHOR]

The effective altruism movement argues that people wanting to do the most good they can should donate to charities fighting poverty in poor countries overseas, rather than to charities helping people in need in wealthy countries. This is because there is greater need in the developing world meaning it is possible to save lives or improve living conditions at reasonably low cost. However, most people living in developed countries prefer to donate to charities helping people in need in their own country, rather than charities helping people in need in the developing world. This paper analyses why this might be. We conduct a discrete choice experiment to determine the relative importance people place on the effectiveness of a donation, the need of recipients, and whether the donation will be spent at home or overseas. We find that many people place more weight on where the donation will be spent than on how effective it will be. We also find that a significant number of people are not aware, or do not believe, a donation will be more effective in the developing world. In addition, many people's donation decisions are guided by emotion or intuition, rather than rational calculation. [ABSTRACT FROM AUTHOR]

This paper examines whether investor attention to Islamic finance creates spillover or not. The answer to this question is relevant to understanding whether the recent growth in Islamic Finance is due to an increase in fundamentals or is more to do with a market attention shock. We examine this question for three developed countries (France, the United Kingdom (the UK) and the United States of America (the USA)), four emerging countries (Saudi Arabia (SA)), the United Arab Emirates (the UAE), Pakistan and India), and the whole world. Our findings show that while the US and the UK lead investor attention to Islamic finance and spillover across the globe, India and Pakistan have experienced the greatest spillover from investor attention for both emerging and developed countries. Saudi Arabia and the UAE, on the other hand, play a somewhat minor role. [ABSTRACT FROM AUTHOR]

Using regional level panel data of three developed countries, comprising Australia, Canada, and New Zealand, the study investigates the response of consumption smoothing to housing capital gains. The consumption smoothing model first revisits the theory of perfect risk sharing. After rejecting a full consumption smoothing hypothesis, the results strongly indicate that the appreciation of house values smooths consumption further. For the sake of comparison, analysing three developed economies reveals the diversification in the response of consumption to long-run output shocks. Canadian residents appear to be more sensitive to permanent domestic output shocks while Australian's consumption pattern remains unchanged. [ABSTRACT FROM AUTHOR]

The aim of this study is to test the hypothesis that environmental stringency adversely affects the international competitiveness (net exports) in manufacturing sectors. The model follows the standard factor endowment approach to explain the effects of environmental regulatory policy on net exports in different product-based industries. An econometric model is constructed, which includes factor endowments and environmental regulations to examine how strict environmental policies impact export competitiveness. A panel dataset of 10 Organisation for Economic Co-operation and Development (OECD) countries, over 17 years, 1987-2003, was constructed for the modelling effort. The study finds that environmental regulations can be a way to combat the flight of manufacturing out of developed countries if the output from these industries can be identified as environmentally friendly. A positive relationship between net exports and environmental regulations was found for paper products, wood products and textile products. However, most manufacturing industries are harmed by increased environmental regulations. [ABSTRACT FROM AUTHOR]

Recently, several studies have been a detailed evaluation of the economic implications of energy taxation as a policy instrument to conserve energy and reduce carbon emissions. However, little attention has been devoted to inquiring about the economic implications of energy taxation in the newly industrialized countries (the so-called NICs). In this paper, we use a multisector, multihousehold computable general equilibrium model to assess the distributional effects of alternative energy taxation on the Taiwan economy. The counterfactual simulation technique is applied to investigate the income distribution implications of: (1) an increase in the import taxes of crude oil; and (2) an increase in the excise taxes of petroleum products. Our empirical results basing on Taiwan's data show that both energy taxes increase government revenue and the Gini coefficient, but reduce net value-added, private consumption, disposable income and equivalent variation. A raise in the Gini coefficient implies that there is a worsening in the distribution of income. The lowest income group suffers relatively large welfare and income loss, but the highest income group suffers a relatively small welfare and income loss. The distributional effects differ from household to household depending on the composition of their total consumption and the source of their factor income. Our findings reveal that the energy tax appears to be mildly regressive, there are broadly consistent with those cases of developed countries reported in previous studies. [ABSTRACT FROM AUTHOR]

There is little empirical evidence on the effect of minimum wage increases on prices, particularly for developing countries. This paper provides estimates of this effect using monthly Brazilian household and firm data over 18 years. As minimum wage increases in Brazil sare large and frequent, they have a potentially important impact on aggregate prices. Rational agents, in anticipation of such price effects, may take minimum wage increases as a signal for future price and wage bargains. We find that the minimum wage raises overall prices not only on the month of the increase, but also in the two months prior to the change as well as after the change. [ABSTRACT FROM AUTHOR]

International tourism is a fast growing industry generating half a trillion dollars in annual revenues and accounting for almost 10% of total international trade, and almost half of total trade in services. Yet, it has so far failed to receive the attention it deserves from mainstream economies. This paper attempts to provide an initial understanding of the determinants of international tourism. This paper claims that international tourism, as other forms of trade in services, is driven by unique factors of production, and may be better dealt with in a single industry study rather than in a general equilibrium trade model. In order to understand these determinants the world is viewed as a market of differentiated products, and a discrete choice estimation technique is applied to a large three-dimensional data set of tourist flows. It is shown that a relatively simple estimation technique, combined with a rich data set, can deliver reasonable substitution patterns. It is found, among other things, that political risk is very important for tourism, and that exchange rates matter mainly for tourism to developed countries. These have exchange rate elasticity of about one. [ABSTRACT FROM AUTHOR]

The debate that expenditure on new or existing roads induces more traffic has intensified during the 1990s in most developed countries. In this paper the controversy is readdressed from a UK perspective, using the method of Granger noncausality. Results indicate that aggregate expenditure on new and existing roads does not induce additional traffic in the Granger sense. Conversely, the results found that traffic Granger causes road expenditure. The importance of these results, along with issues concerning the selection and specification of dynamic models, are discussed. [ABSTRACT FROM AUTHOR]

This paper examines whether the variability of money growth caused changes in income velocity of money in 30 less developed countries. Time-series data show year-to-year variations in income velocity of money in these countries for the 1961-1990 period. Empirical results based on causality but complemented by variance decomposition tests show that money growth is the most important determinant in explaining the variability in income velocity in at least 20 of the 30 developing countries examined in this study. In addition, the causality results show that inflation rate Granger-causes income velocity of money in 21 countries, but the variance decomposition results show inflation rate to be relatively more important in explaining the variability of velocity in eight countries. Similarly, while real income Granger-causes velocity of money in 18 countries, the results of the variance decomposition tests show real income to be relatively more important as a determinant of income velocity in two countries. Overall, these results show that the Grangercausality as a test of predictability does not show the effects of shocks to one variable on another, but the variance decomposition test provides evidence with respect to the effects of shocks. [ABSTRACT FROM AUTHOR]

The premise of this paper is that the U.S. private sector differs from other major industrialized nations with respect to the allocation of capital between commercial structures, residential structures and machinery and equipment. This paper compares the seven major industrialized nations with respect to capital allocation differences among various asset categories, the role of tax depreciation rules in capital allocation and capital formation. The results shed light on how the U.S. compares with its trading partners regarding the proportion of gross domestic product (GDP) that supports capital formation. The results provide evidence on capital allocation differences among the countries and on the influence of tax depreciation in capital allocation, while indicating how various tax acts in the U.S. have affected capital allocation in the U.S. private sector. This study adds to prior studies by disaggregating capital allocation into residential rental structures, commercial structures and machinery and equipment and by examining the influence of various tax acts on capital allocation in the U.S. private sector.

We construct a GFAVAR model with newly released global data from the Federal Reserve Bank of Dallas to investigate the drivers of global official/policy interest rate. We find that 66% of movement in global official/policy interest rates is attributed to changes in global monetary aggregates (23%), oil prices (19%), global output (16%) and global prices (8%). Global official/policy interest rates respond significantly to increases in global output, inflation and oil prices. Increases in global policy interest rates are associated with reductions in global prices and global output. The response in official/policy interest rate for the emerging countries is more to global inflation, for the advanced countries (excluding the U.S.) is more to global output, and for the U.S. is to both global output and inflation. [ABSTRACT FROM AUTHOR]

Stigler and Becker (1977) argue that tastes neither change capriciously nor differ importantly between people; it is differences in prices and incomes that determine differences in behaviour. In this paper we analyse the alcohol consumption patterns of drinkers from 8 industrialized countries. We identify a number of empirical regularities and verify Stigler and Becker's hypothesis that income and price elasticities of demand are international constants by showing that alcohol consumption patterns in the eight countries exhibit intriguing similarities. The income and price elasticities of alcohol are found to be about 0.8 and -0.6, respectively, in all eight countries. [ABSTRACT FROM AUTHOR]

Obesity and overweight are central issues in the public health debate in most developed countries. In this debate, some of the socio-economic determinants of obesity and overweight are still relatively unexplored. This paper presents an empirical examination of the possible influence of social interactions on contemporaneous obesity and (over)underweight. A joint estimation model for obesity and self-image is applied to a sample for Spain taken from the European Union household panel for 1998. The results suggest that obesity might be in part a social phenomenon connected to individuals' social life. [ABSTRACT FROM AUTHOR]

The paper explores the role of Environmental Defensive Expenditures in the consumption behaviour of Italian households. Environmental Defensive Expenditures are not borne to increase households' welfare, but to prevent or avoid the effects of a worsening environmental quality. The literature on environmental accounting argues that economic growth in industrialized countries is accompanied by an increasing load of defensive activities that may lead to a reorientation of consumption behaviour. In this work this hypothesis is tested using annual data on mean consumption expenditures of Italian households from 1985 to 1996. A complete system of demand is estimated and short-run price elasticities of demand for Defensive Expenditures are calculated. The complete system of demand functions is specified using the Quadratic Almost Ideal Demand System proposed by Banks, Blundell and Lewbel. Results show that there is very low substitution between the demand for the six aggregate goods in which total expenditure is here divided and the Environmental Defensive Expenditures. Thus it seems that an increase in Environmental Defensive Expenditures, driven by a change in environmental quality, would not lead to a change in the consumption pattern, at least as far as Italian households are concerned. [ABSTRACT FROM AUTHOR]

Cointegration and vector autoregression are used to test the 'Tax-and-Spend', 'Spend-and-Tax', and 'Fiscal Synchronization' for ten countries using annual time-series data over the period 1951 to 1996. Three of them are part of the newly industrialized countries of Asia (South Korea, Taiwan, and Thailand) and seven are industrialized countries (Australia, Canada, Japan, New Zealand, South Africa, UK, and the USA). This paper includes GDP as a control variable into the model like Baghestani and Mcnown (1994), Ross and Payne (1998), and Koren and Stiassny (1998). The Johansen (1988) and Johansen and Juselius (1990) cointegration test results indicate that these three variables are cointegrated with two cointegrating vectors for South Korea, one vector for Australia, Canada, South Africa, Taiwan, UK, and the USA, and no vector for Japan, New Zealand, and Thailand. The results from Granger causality tests suggest unidirectional causality running from revenues to spending, supporting the 'Tax-and-Spend' hypothesis, for Japan, South Korea, Taiwan, UK, and the USA. The opposite relationship, supporting the 'Spend-andTax' hypothesis, holds only for Australia and South Africa. In the case of Canada, this study finds a feedback existing between revenues and spending, supporting the 'Fiscal Synchronization' hypothesis. For New Zealand and Thailand, these results support none of the hypotheses. [ABSTRACT FROM AUTHOR]

P-Star models have become increasingly popular in recent years in developed countries. However data constraints have limited their applicability to the LDCs. In this paper, such a model is attempted for India using both annual and quarterly data for the period 1955–1995. It is found that velocity in India is trend stationary and using cointegration techniques it is then possible to develop a model to gauge inflationary pressures in the economy. The model is well calibrated to data, and in out-of-sample forecasts, it significantly outperforms a seasonal ARMA benchmark model. The velocity gap version of the model is particularly successful. [ABSTRACT FROM AUTHOR]

Indexes of real and nominal effective exchange rates that are published by the IMF, are mostly for industrial countries. None of the Middle Eastern countries have received any attention on this regard. This paper tries to close the gap by constructing such indexes for 11 middle eastern countries over 1971(I)-1994(IV) period. As an application, long-run response of their trade balance to devaluation is also investigated. [ABSTRACT FROM AUTHOR]

The International Monetary Fund construct and publish real and nominal effective exchange rate data, mostly for developed countries. In this paper real and nominal effective rate data for developing countries are constructed. Application of the KPSS test to real effective rate data reveals that PPP holds in most countries. [ABSTRACT FROM AUTHOR]

The paper presents the estimation of an empirical model of market share dynamics for five industrialized countries and 18 industries. The emphasis is put on the importance of non-price factors of competitiveness, whereas most traditional explanations rest on the influence of relative prices. Among the former type of factor, the role of variables reflecting technological advantage is privileged In particular, the role of innovations has received considerable attention in the literature on international trade as well as the literature on endogenous growth. In this spirit, the paper introduces patent counts and investment as explanatory variables for the export-market share. The results show that non-price variables have an important impact on the determination of long-run competitiveness. [ABSTRACT FROM AUTHOR]

This paper uses vector autoregressions to investigate the interdependence of the monetary policies of the central banks of Germany, Japan and the United States. Granger-Sims causalities and innovation accounting mechanisms suggest that trilateral linkages are strong and complex. The results imply that the influence of foreign central banks' policies limit each central bank's capacity to determine an independent domestic policy.
This paper investigates the relationships among the monetary policies employed by the central banks of three major industrial countries. It employs vector autoregression (VAR). The monetary linkages are based on the money supply reaction functions discussed by Hamada (1976), Canzoneri and Gray (1985), Cooper (1985), Rogoff (1985) and Frankel and Rockett (1988). The VAR technique, which in the past has mostly been applied to the question of money-income causality,[2] has been controversial. King (1983), Runkle (1987) and Spencer (I989) raised doubts about the robustness of VAR estimates, while Jacobs et al. (1979), Cooley and LeRoy (1985) and Learner (1985) questioned its ability to test for the causal inference. However, Sims (1980a, 1980b, 1986) and Todd (1990) in particular respond to critics by asserting that numerical instabilities in VAR estimates cannot overturn the findings on money-income causality. Even skeptics recognize that the technique has many valid uses. Economists such as King and Plosser (1984), Evans (1985, 1986, 1987), Fackler (1985), Bernanke (1986), Blanchard and Watson (1986), Taylor (1986), Barnhart and Darrat (1989), Blanchard (1989) and Brocato and Smith (1991) continue to employ the VAR technique in the areas of macroeconomic fluctuations (not confined to the money-output relationship) and fiscal deficits.
The VAR results for Granger-Sims causalities and innovation accounting mechanisms suggest that monetary linkages among the G-3 are strong. Causality runs from the United States to the other two... [ABSTRACT FROM AUTHOR]

In this paper it is argued that since K-M's sample includes both developed and developing countries, a disaggregation of their sample into two groups is necessary because, as it turns out, the two groups come from different populations, so that there are fundamental differences in the determinants of growth in the two groups. Further, as the results presented here show, this disaggregation also resolves some of the puzzles reported by them. At the same time, the results point to some even more interesting puzzles. The policy implications of these results for the two groups are quite different. At the same time, some of the hypotheses tested by them turn out to be even more robust than suggested by their aggregate results.
The scheme of the paper is as follows. In Section II, the K-M model is specified. The disaggregated results and their discussion are presented in Section III. The final section concludes with a brief summary and some suggestions for further research. [ABSTRACT FROM AUTHOR]

This paper differs from his in the following manner. First, the reserve demand equation is estimated for developed (DCs) as well as less developed countries (LDCs). Second, the estimation period is the current floating rate period of 1973-80 rather than the fixed rate period of 1964-72. Finally, quarterly data is used rather than annual data.
Section II of the paper presents the reserve demand equation that is to be estimated. Section III provides a test of serial correlation and heteroscedasticity. Section IV presents the results of estimation and evidence in support of the square-root law. Section V sheds some empirical light on the dynamic adjustment of reserves. Finally, the concluding remarks are provided in Section VI. Data definitions and sources are listed in the Appendix. [ABSTRACT FROM AUTHOR]

Numerous studies have empirically examined the money demand function in several developed and developing countries. However, money demand functions in the OPEC economies have been largely ignored. This paper estimates appropriate money demand equations for three OPEC economies, namely Saudi Arabia, Libya and Nigeria. The open-economy nature of the money demand model and its structural stability are stressed and tested. Over the quarterly period 1963 to 1979, the estimated money demand equations for the three countries fit the data quite well and exhibit structural stability. Importantly, the inclusion of a variable representing foreign monetary influence into the estimated equations appears necessary for the stability result to emerge.
The purpose of this paper is to investigate empirically the demand for money in three major members of OPEC (Organization of Petroleum Exporting Countries), namely Saudi Arabia, Libya and Nigeria using the quarterly observations for the period 1963 through 1979.[1] Most economists and policy-makers alike would agree on the importance of the demand for money function to almost all theories of aggregate economic activity and particularly to the process of monetary policy. However, with a few notable exceptions in the case of non-OPEC developing economies[2], the money demand research has been limited to the industrial economies.[3]. [ABSTRACT FROM AUTHOR]

Hospitals are central to the operation of health care systems in all advanced countries, and have become a major focus of research activity by health economists.[1] Despite this attention, a convincing model of the hospital's economic structure and behavior which can be empirically supported remains elusive: as Newhouse (1978) remarks, 'the numerous theories of hospital behavior have generated few testable hypotheses, and little actual testing has occurred . . . '. The aim of this paper is to provide empirical estimates, from a sample of NHS hospitals, of the relationship between cost and output and of the factors which influence unit cost variations. It improves on past studies on three important grounds: first, problems of output definition and measurement are overcome by choosing a particular type of hospital to study (maternity hospitals); secondly, the samples drawn from this specialty group ensure as far as possible homogeneity of output and functions; and, thirdly, the costs involved are not accounting costs but have been largely assembled by means of special surveys to reflect as far as possible the real costs of the outputs produced.
The paper begins with a description of the data. The importance of overcoming the problems of definition and measurement of output in health economics cannot be overemphasized[2] and there is, therefore, some discussion of the steps taken to arrive at a suitable data base for this type of study. This is followed by the identification of cost/output relationships for the two samples and the presentation of results. The next section employs econometric techniques to explain cost differences between the units of 'production' under study using measures and indicators of scale, utilization, efficiency and quality. The results of the analyses cast doubt on the wisdom of placing hospital cost analyses strictly within the framework of the theory of the firm and the consequences of doing so are considered in the final secti... [ABSTRACT FROM AUTHOR]

Kaldor's growth laws are applied to the post-World War II United States. Each variable employed in the time-series analysis is smoothed with a moving average. This procedure successfully mitigates the effects of short-term cyclical changes and emphasizes long-term economic growth. The empirical tests employing time-series, measuring long-term growth, indicate that Kaldor's laws are compatible with the economic growth of United States.
The purpose of this paper is to analyse post-World War II United States economic growth by applying Kaldor's growth laws. There have been several tests of Kaldor's laws of economic growth using cross-section data for industrially advanced countries (see Thirlwall, 1983). These studies although informative are not able to provide an account of Kaldor's laws in explaining variations of the economic growth of a country over time.
In this paper in order to apply Kaldor's laws to long-term economic growth, the annual growth of each variable employed in time-series analysis is smoothed with a moving average. This procedure, by emphasizing long-term economic growth, is in conformity with the intent of Kaldor's laws and successfully mitigates the effects of short-term cyclical changes. The empirical tests discussed below, employing time-series measuring long-term growth, reveal that Kaldor's laws are compatible with the economic growth of the United States. [ABSTRACT FROM AUTHOR]

This study aims to analyze the effect of digitalization on government effectiveness in developing and developed countries. It uses a panel methodology with data from 138 countries between 2006 and 2016. The results suggest that a government's use of information and communication technologies (ICT) improves its effectiveness in both developing and developed countries. However, this effect is stronger in developed than in developing countries. Moreover, we find that the effect of aggregate ICT use by individuals, businesses, and government on overall government effectiveness is greater than that of individual use by each individually. The results are robust after several tests (reverse causality, dynamic effect, sensitivity analysis, heterogeneities, and alternative measurements). These results highlight the fact that governments could fully benefit from digitalization by adopting policies that promote access to and use of ICT at all levels of the economy, that is, the government itself, businesses, and individuals. [ABSTRACT FROM AUTHOR]

In this article, we empirically study the impact of per capita income on health-care expenditure and its dynamics over time in a sample of 14 OECD countries for the period 1971 to 2009. A simple model, built upon one developed by Newhouse (1977), suggests that health care is a necessity in the short run but it cannot be rejected to be a luxury good in the long run. Our findings provide strong empirical evidence that a year’s health expenditure is conditioned by the previous one. Interestingly, our results reveal increasing income inelasticity over time along with huge heterogeneity across countries. Finally, this article supports the hypothesis of conditional convergence in health-care spending among countries. In designing policies which facilitate the sustainability of national health systems, we emphasize that ceteris paribus the greater the participation of public health, the lower the growth rate of health spending. High share of children and elderly over working age population opposite influences. We also provide evidence that technological progress could reduce the long-run income elasticity for health care, which in turn threaten the sustainability of health-care systems. [ABSTRACT FROM PUBLISHER]

This article presents a range of tools and indicators for analysing fiscal vulnerabilities and risks for advanced economies. The analysis covers key short-, medium- and long-term dimensions. Short-term pressures are captured by assessing (i) gross funding needs, (ii) market perceptions of default risk and (iii) stress dependence among sovereigns. Medium- and long-term pressures are summarized by (iv) medium- and long-term budgetary adjustment needs, (v) susceptibility of debt projections to growth and interest rate shocks and (vi) stochastic risks to medium-term debt dynamics. Aiming to cover a wide range of advanced economies and minimize data lags, has also influenced the selection of empirical methods. Due to these features, they can, for example, help inform the joint IMF–FSB Early Warning Exercise (EWE) on the fiscal dimensions of economic risks. [ABSTRACT FROM PUBLISHER]

Labour productivity growth in manufacturing is decomposed into technical efficiency change (movement towards or away from the frontier), technological progress (shifts in the production frontier), and capital accumulation (movement along the frontier) using a nonparametric production frontier method. The results suggest that labour productivity growth is primarily driven by capital accumulation and to a lesser extent technological progress, while technical efficiency is deteriorating over the period 1995–2014. We find that technological progress appears to be non-neutral, as the world manufacturing production frontier expands only at higher capital intensities, benefiting highly industrialized nations. We also find evidence of unconditional convergence in labour productivity for the manufacturing sector. Capital accumulation is the main driver of the observed unconditional convergence, whereas technological change is contributing to divergence rather than convergence. The findings suggest that expanding manufacturing activities through capital accumulation is essential for developing countries to catch-up with developed countries. [ABSTRACT FROM AUTHOR]

Eradication of poverty is the most pervasive goal of donors' foreign aid programmes. As a result, there has been much research on the degree of correlation between aid and poverty reduction. However, this work to date has shed little light on the direction of causation between the two variables. Using the method of Granger causality, and conditioning aid and poverty on the state of democracy in developing countries, this study asks whether aid flows impact poverty, whether poverty influences aid flows, or whether causality proceeds in both directions simultaneously. While the results identify no causal relationships in some of the sub-samples, they point to the existence of a multitude of relationships across others. [ABSTRACT FROM AUTHOR]

This paper analyses the sensitivity of firm performance to exchange rate fluctuations. In a two-country world, consisting of a developing domestic country and a developed foreign country, we show that this sensitivity is closely related with market structure and the share of imported inputs in total cost. When the share of imported inputs is low, depreciation leads to an increase in price cost margin. This increase intensifies in more competitive industries. When the imported input share is high, the price cost margin may decrease as a result of depreciation, and this effect becomes pronounced in more competitive industries. The empirical test where we used 3-digit Turkish Manufacturing industry data support most of the findings of our model. [ABSTRACT FROM AUTHOR]

The impact of international trade on labour markets in developed countries will be different according to the degree of competition in product markets, the flexibility of the labour market and the skill intensity of production. An econometric analysis of the impact of trade in France has been undertaken using sectoral data for the period 1985-1992. It is found that lower relative import prices reduce the relative employment of low skill workers in the first half the period and reduce their relative wages in the second half. In both cases the effect is more pronounced in sectors where the skill intensity of production is initially low. [ABSTRACT FROM AUTHOR]

Albeit notably increasing studies dedicated to investigating the impact of air pollution on enterprises' productivity and profit, few have oriented onto explicitly probing how the enterprises, particularly those foreign-invested firms, made their location choices concerning air quality. Accordingly, this study contributes to explain the impact of air pollution on the site selection of foreign-invested manufacturing enterprises with a unique firm-level dataset of China. The study also discloses the heterogeneity of air pollution effects attributable to enterprises' various features regarding ownership property, host country, industrial classification, and investment scale. Our result justifies a statistically significant and negative impact of air pollution on the siting of foreign-invested manufacturing enterprises. The heterogeneous effects of air pollution manifest that the location choice would be remarkably more sensitive for the sole-venture enterprises, and for those headquartered in developed countries, engaged in high-technology industries, and at small and medium investment scales. The study finds that the siting of small-scale firms in high-technology sectors appears to be the most sensitive to air pollution, signifying that air pollution severity would be a pivotal factor pushing aside high-quality foreign-invested enterprises to invest in polluted areas in general. [ABSTRACT FROM AUTHOR]

The article examines the hypothesis that the severity of a recession favourably affects the rate of growth of output during the period immediately after the recession. The notion that there is a period of recovery distinct from the rest of an expansion is implicit in a variety of models of the business cycle. The dynamics of the recovery are essentially the same as the transitional dynamics of the standard neoclassical Solovian growth model. The economy grows more rapidly the further is the capital stock from its long run equilibrium level. Consequently, large technology shocks that are absorbed in part by running down the capital stock should be followed by periods of rapid growth. The existence of a relationship between growth in the early stages of a recovery and the severity of the preceding recession may indicate some sort of self-correction mechanism at work. It is equally arguable that rapid growth may reflect a vigorous policy response initiated as a result of the severity of the preceding recession.

The purpose of this paper is to show empirically that the 'debt crisis' of 1982, and its still lingering effects, played a major role in the dramatic downturn of domestic investment in most lesser developed countries (LDCs). The hypothesis of a nested model incorporating variables reflecting indebtedness could not be rejected for ten of thirteen Latin American countries sampled. In addition significant structural shifts were found in the investment equations during and after 1982, suggesting that the debt crisis also changed the sensitivity of investment to external and internal economic factors, besides lowering its average level. [ABSTRACT FROM AUTHOR]

The purpose of this paper was to estimate equations relating spreads above the London Interbank Offer Rate (LIBOR) charged on sovereign-guaranteed private Eurodollar loans to various indicators of default risk for both lesser developed countries (LDCs) and developed countries (DCs). The study focused on the period 1978-84 using sample loan data of 27 LDCs and 14 developed countries. The results suggest that spreads charged to LDCs are functions of indicators reflecting default risk, while spreads charged to DCs are to a lesser extent. Holding default risk constant across both LDCs and DCs, a statistically significant gap in the average interest spreads favors DCs. This gap was subsequently explained by variables reflecting investment return from borrowed capital. Significant differences in risk coefficients between LDCs and DCs still persisted for the terms of trade, the debt-service-exports ratio, the investment-GNP ratio, and the debt-GNP ratio. [ABSTRACT FROM AUTHOR]

Using data for short-term and long-term interest rates across a major group of industrial countries, this paper studies the impact of interest rate variability on the cyclical behavior of real output and the price level in these countries. Theory predicts that the increased variability of the interest rate stemming from a rise in the level of uncertainty has a negative impact on the output demanded and supplied and, in turn, an ambiguous impact on the price level. The empirical evidence is, generally, consistent with this prediction. Next the investigation attempts to shed some light on major sources of uncertainty underlying the interest rate variability. Focus is on the variability of monetary growth, the exchange rate and the energy price. Some evidence on the relative contribution of these sources of uncertainty to the variability of the interest rate and, in turn, to the cyclical behavior of real output and the price level across countries is provided. [ABSTRACT FROM AUTHOR]

There is consensus among researchers that under the present floating exchange rate system although developing countries peg their exchange rate to a major currency, they cannot avoid fluctuation in their effective exchange rates as long as major currencies fluctuate against one another. Few authors have investigated the effects of changes in effective exchange rates of developing countries on their imports, exports, trade balance, demand for international reserves, inflation etc. In this paper we try to investigate the effects of effective exchange rates of developing countries on their demand for money. Previous authors who have estimated a money demand function, inclusive of an exchange rate variable (bilateral or effective), have restricted themselves to industrial countries only. By using quarterly data over the 1973-85 period, it is shown that in most developing countries, while the short-run effects of depreciation could be in either direction, its long-run effects are negative indicating that depreciation causes a decline in the demand for domestic currency. [ABSTRACT FROM AUTHOR]