Applied Economics Letters

Yamada, Ken

doi: 10.1080/13504850600749016pmid: N/A

In this article, I estimate the uncompensated and compensated wage elasticities and the income elasticity of time, for married men and unmarried women in Japan. For the purpose of the estimation, I control for the potential endogeneity of the wage and income variables.

Cook, Steven

doi: 10.1080/13504850600722039pmid: N/A

While there is disagreement concerning the integrated nature of US Gross domestic product (GDP) over the long-run, there is a consensus that it is best characterized as I(1) over the post-World War II period. In this article the existing literature is extended via the use of an exponential smooth transition autoregressive (ESTAR)-based unit root test. It is shown that in contrast to the conventionally applied ADF test and the more powerful GLS-based ADF test, introduction of an alternative hypothesis of ESTAR adjustment results in the overwhelming rejection of the presence of a unit root. Similar results are presented for UK GDP over the same period.

Badinger, Harald

doi: 10.1080/13504850600722112pmid: N/A

Using aggregate manufacturing data and a cross-section of 40 countries, we estimate the effects of trade, competition and country size on productivity. Endogeneity of trade and competition is accounted for using instruments that are based on entry barriers and geographical characteristics of the countries. We establish several empirical regularities: (i) Both trade and competition are statistically and economically significant determinants of productivity. (ii) The pro-competitive effect of trade accounts for a quarter of trade's total productivity effects. (iii) Country size appears to play no role, once trade and competition are controlled for. (iv) There is no evidence for a nonlinear relation between competition and productivity or for the hypothesis that larger countries gain less from trade.

Bahmani-Oskooee, M.; Gelan, A.

doi: 10.1080/13504850600749040pmid: N/A

Kuznets' inverted-U hypothesis implies that economic growth worsens income inequality first and improves it later at a higher stage of economic development. In addition to economic growth, other factors such as population growth, resource endowment, price instability, openness, currency devaluation, etc. have been identified as determinants of income inequality. Previous research used cross-sectional data to test not only the Kuznets' hypothesis, but also empirical validity of other factors and provided mixed conclusions. In this article we use time-series data from the US and recent advances in time-series modelling to show that economic growth worsens income inequality in the short-run and improves it in the long-run.

Olave, Pilar; Andrés, Eva Maria; Alcalá, José Tomás

doi: 10.1080/13504850600749057pmid: N/A

The effect of successive periods of unemployment according to household type has not been analysed in any depth with respect to the Spanish labour market. In this article, we propose a nonparametric methodology based on a data-driven likelihood ratio function to describe the dependence between the duration of successive periods of unemployment according to different household typologies. This study, which uses a very large data set, specifically, the Spanish sample of the European Community Household Panel (ECHP), first reveals a weak dependence between the consecutive unemployment durations in the case of the most frequent household typology. In addition, we find that the first months of the previous spells of unemployment have a significant impact on subsequent expected unemployment duration.

Depken, Craig A.

doi: 10.1080/13504850600735270pmid: N/A

The blogosphere is a relatively recent development on the Internet and, for this reason, has received limited empirical investigation. This short note investigates whether the popularity of the 500 most popular blogs during August and September of 2005, as measured by in-coming links, followed the first-digit distribution attributed to Benford (1938) and the rank-size distribution attributed to Zipf (1949). The evidence suggests that the blogs investigated were not characterized by either empirical regularity, consistent with blog popularity being caused by network externalities.

Chigira, Hiroaki

doi: 10.1080/13504850600722096pmid: N/A

Using principal component methods, we construct a cointegration rank test that is less restrictive than Johansen's tests, easy to calculate, and independent of the dimension of the process. Monte Carlo simulations indicate that the proposed test outperforms Johansen's tests.

Euwals, Rob

doi: 10.1080/13504850600722104pmid: N/A

Parts of the Dutch tax reform 2001 are directed towards fiscal partners in a household and aim at lowering the marginal tax burden of the partner with the lowest (potential) labour income. An important goal of the reform is to increase the employment rate of these partners, which are in majority women. The Dutch Labour Force Survey 1992−2003 shows that the growth of the employment rate of married women after 2001 was larger for a comparable group of single women. A statistical analysis using a model that accounts for measurement error shows that the growth of the employment rates of women without young children is in line with the predicted effect of the tax reform.

Vougas, Dimitrios V.

doi: 10.1080/13504850600722120pmid: N/A

Via simulation, the size of the lagrange multiplier (LM) unit root test is examined, when there is a neglected level or trend break under the null hypothesis. It is found that unlike other more popular unit root tests in the literature, the size of the LM is not distorted/inflated. Thus, rejections of the LM tests must not be viewed as spurious with respect to this issue of neglected breaks.

Cademartori, David; Navia, Rodrigo; Galea, Manuel; Osorio, Felipe

doi: 10.1080/13504850600748950pmid: N/A

The purpose of this work is to verify the stability of the relationship between real activity and interest rate spread. The test is based on Chen (1988) and Osorio and Galea (2006). The analysis is applied to Chile and the United States, from 1980 to 1999. In general, in both cases the relationship was statistically significant in early 80s, but a break point is found in both countries during that decades, suggesting that the relationship depends on the monetary rule follow by the Central Bank.