All of the Department Discussion Papers are submitted to RePEc. The EconPapers or IDEAS sites allow you to search by author, title, keyword, JEL category and abstract contents.
Papers from 1998 onwards are available on-line as .PDF files.
13/23 Asako Ohinata and Jan C. van Ours
We analyze how the share of immigrant children in the classroom affects the educational attainment of native Dutch children in terms of their language and math performance at the end of primary school. Our paper studies the spill-over effects at different parts of the test score distribution of native Dutch students using a quantile regression approach. We find no evidence of negative spillover effects of the classroom presence of immigrant children at the median of the test score distribution. In addition, there is no indication that these spill-over effects are present at other parts of the distribution.
13/22 Dimitrios Varvarigos
I model an economy where the adverse health effects of pollution impede labour productivity and capital accumulation is the source of economic growth. Pollution is generated by firms that choose whether to employ a dirty technology and pay an environmental tax, or employ a clean technology and incur the cost of its adoption. The task of inspecting the environmental impact of each firm’s production technology is delegated to bureaucrats who are corruptible since they receive bribes in order to mislead authorities on the firms’ actual technology choice. The model can generate multiple steady state equilibria. In this context, the multiplicity of equilibria is associated with indeterminacy, due to the self-fulfilling nature of corruption incentives and the relevant implications for pollution, productivity and economic growth.
13/21 Eleni Stathopoulou and Dimitrios Varvarigos
We model an economy where imperfectly competitive firms choose whether
to employ a dirty technology and pay an emission tax or employ a clean
technology and incur the cost of its adoption. Bureaucrats who are entrusted
with the task of monitoring the emissions of each firm, are corruptible in the
sense that they may accept bribes in order to mislead authorities on the firms’
actual emissions. Market entry is an important element in the relation between
corruption and pollution. Particularly, the incidence of corruption increases the
number of entrants in the market, while the bureaucrats’ incentives to be
corrupt are higher in a market with more competitors. We find multiple
equilibria where both corruption and pollution are either high or low.
13/20 Heather D. Gibson, Stephen G. Hall and George S. Tavlas
We investigate the impact of the economic fundamentals, sovereign credit ratings, political uncertainty, and the ECB’s Securities Markets Program (SMP) on Greek sovereign spreads. Our findings show that sovereign downgrades and political uncertainty appear to have been drivers of the sharp rises in Greek sovereign spreads from 2008-9 onwards, over-and-above the impact of the economic fundamentals. Our findings also show that prior to 2008-2009, the markets failed to incorporate Greece’s deteriorating fundamentals into the price of Greek sovereigns. We demonstrate that, once markets reassessed their pricing of Greek credit risk, the change in the influence of the fundamentals came swiftly and abruptly, exhibiting overshooting characteristics. The SMP reduced spreads while it was in operation.
13/19 Dimitrios Varvarigos
Recent evidence of increasing fertility rates in developed countries, offers
support to the idea that, from the onset of early industrialisation to the present
day, the dynamics of fertility can be represented by an N-shaped curve. An
OLG model with parental investment in human capital can account for these
observed movements in fertility rates during the different phases of
demographic change. A demographic transition with declining fertility emerges
at the intermediate phase, when parents engage on a child quantity-quality tradeoff.
At later stages however, the continuing process of economic growth
generates sufficient resources so that households can rear more children while
still providing the desirable amount of educational investment per child.
13/18 Dimitrios Varvarigos
Existing evidence shows that activities promoting the formation of human
capital are countercyclical. In a two period OLG model, I show that
countercyclical investment in human capital arises as a result of a parametric
combination relating to preferences and technologies. This countercyclical
reaction is responsible for the non-monotonicity in the evolution of human
capital, thus initiating a self-sustained sequence of events that generate
endogenous cycles, and possibly chaotic dynamics.
13/17 André Barreira da Silva Rocha
I propose an evolutionary game model to study competition among a large number of firms, in which I take into account the issues of social responsibility, government monitoring of environmental compliance and consumer boycott. A large number of firms sell their homogeneous good in an almost perfect competitive market, where consumers have preferences for socially responsible firms. Firms may incur additional costs and carry out social investment and/or environmental investment. Each time interval, a firm may be called to play a competition-stage game, in which it tries to sell its good, or an audit-stage game, in which inspectors audit its degree of environmental compliance.
13/16 Youngsub Chun, Manipushpak Mitra and Suresh Mutuswami
We investigate the implications of egalitarian equivalence (Pazner and Schmeidler ) together with queue efficiency and strategyproofness in the context of queueing problems. We completely characterize the class of mechanisms satisfying the three requirements. Though there is no mechanism in this class satisfying budget balance, feasible mechanisms exist. We also show that it is impossible to find a mechanism satisfying queue efficiency, egalitarian equivalence and a stronger notion of strategyproofness called weak group strategyproofness. In addition, we show that generically there is no mechanism satisfying two normative notions, egalitarian equivalence and no-envy, together.
13/15 - Youngsub Chun, Manipushpak Mitra and Suresh Mutuswami
We investigate the problem of reordering agents starting
from an existing queue. First, we introduce four important axioms
of the problem, budget balance (BB), outcome efficiency (OE), strategyproofness
(SP), and individual rationality (IR). Unfortunately, it is
easy to show that these four axioms are incompatible in the current
setup. Given this negative result, we examine the consequences of relaxing
BB, OE and SP, one at a time. Our results are as follows: (i)
There is no mechanism satisfying OE, SP and IR which runs a nonnegative
surplus at all profiles. (ii) When there are two agents, the only
non-trivial mechanisms satisfying BB, SP and IR are Fixed price trading
mechanisms but there are additional mechanisms when there are more
than two agents. We identify an intuitive mechanism which we call the
median price exchange mechanism and characterize its maximal level of
inefficiency. (iii) By weakening SP to `one-sided' strategyproofness, we
identify two mechanisms, the buyers' mechanism and the sellers' mech-
anism, and characterize them on the basis of independence axioms.
13/14 - Daniel Ladley, Ian Wilkinson and Louise Young
Cooperative relations, within and between firms, play important roles in business.
How to produce such relations, however, is less well understood. Building on work in evolutionary biology we examine the conditions under which group based incentives result in better performance than individual based incentives. We find that when individual and group interests are not aligned, group incentive systems lead to both higher group and individual performance. Hybrid reward systems, with both group and individual components, are found on average to be inferior to pure group based systems, but superior for some specific cases.