Applied Economics Letters

Siburian, Matondang Elsa

doi: 10.1080/13504851.2019.1683139pmid: N/A

This paper investigates the effects of fiscal decentralization on regional income inequality in Indonesia. Using provincial-level data over the period 2001–2014, this paper concludes that fiscal decentralization reduces regional income inequality. A simultaneous equation model (SEM) is employed to circumvent possible endogeneity. It follows that the extent to which fiscal decentralization decreases reginal income gap was greater than that in the opposite direction. A possible explanation for this is that compared with a centralized system, it granted the local governments with autonomy in designing development programmes that match unique characteristics of a particular region and distributing more balanced resources within it. Further, decentralization enables a local government to efficiently provide public services in need. Finally, decentralization motivates local politicians to effectively allocate local public goods and services. This is because regional heads are selected through a direct election in Indonesia and that they are keen on being re-elected by better serving the voters.

Kleinjans, Kristin J.

doi: 10.1080/13504851.2019.1683140pmid: N/A

Unemployment results in lower levels of cognitive skills and has long-term effects on health and economic well-being. In this paper, I show that unemployment also has negative effects on noncognitive skills, at least in the short term. Using a sample of Germans born between 1945 and 1995, I account for potential endogeneity by using state-level unemployment rates as instruments and controlling for past levels of noncognitive skills. The effects of not working are strong, reducing conscientiousness by 0.15 of a standard deviation for women and by 0.25 for men.

Ahmed, Ali; Hammarstedt, Mats

doi: 10.1080/13504851.2019.1683141pmid: N/A

We present a field experiment conducted in order to explore the existence of ethnic discrimination in contact with public authorities. Two fictitious parents, one with a Swedish-sounding name and one with an Arabic-sounding name, sent email inquiries to all Swedish municipalities asking for information about preschool admission for their children. Results show that the parents were treated differently by the municipalities since the individual with the Swedish-sounding name received significantly more responses that answered the question in the inquiry than the individual with the Arabic-sounding name. Also, the individual with the Swedish-sounding name received more warm answers than the individual with the Arabic-sounding name in the sense that the answer from the municipality started with a personal salutation. We conclude that ethnic discrimination is prevalent in public sector contacts and that this discrimination has implications for the integration of immigrants and their children.

Wei, Yanfeng; Zhang, Liguo; Li, Qirui

doi: 10.1080/13504851.2019.1683142pmid: N/A

This paper analyzes the role of different types of oil price shocks for real oil price fluctuations and contributes by exploiting insights from the frequency domain perspective. We find aggregate demand shocks are the most important contributor to real oil price fluctuations in the entire spectrum. Besides, oil-specific demand shocks have a relatively important impact on real oil price changes at high frequencies and business cycle frequencies, while oil supply shocks have a relatively important impact on real oil price changes at low frequencies and frequency zero.

Gunarsa, Singgih; Makin, Tony; Rohde, Nicholas

doi: 10.1080/13504851.2019.1683147pmid: N/A

We study the effects of public debt on economic growth using a panel of 25 Asian countries from 1970 to 2015. Using a collection of panel data models, we find weak evidence in favour of a negative relationship. Our estimates imply that a 10% increase in debt predicts declines in growth rates ranging from 0.2% to 0.4%.

Mane, Pramod C.; Ahuja, Kapil; Krishnamurthy, Nagarajan

doi: 10.1080/13504851.2019.1683507pmid: N/A

This paper investigates the impact of link formation between a pair of agents on the resource availability of other agents (that is, externalities) in a social cloud network, a special case of endogenous sharing economy networks. Specifically, we study how the closeness between agents and the network size affect externalities. We conjecture, and experimentally support, that for an agent to experience positive externalities, an increase in its closeness is necessary. The condition is not sufficient though. We, then, show that for populated ring networks, one or more agents experience positive externalities due to an increase in the closeness of agents. Further, the initial distance between agents forming a link has a direct bearing on the number of beneficiaries, and the number of beneficiaries is always less than that of non-beneficiaries.

Fritzsch, Benjamin; Wenger, Kai; Sibbertsen, Philipp; Ullmann, Georg

doi: 10.1080/13504851.2019.1686110pmid: N/A

Combining standard time series models with search query data can be helpful in predicting sales. We include the search volume of company as well as product-related keywords provided by Google Trends as new predictors in models to forecast sales on a product level. Using weekly data from January 2015 to December 2016 of two products of the audio company Sennheiser we find evidence that using Google Trends data can enhance the prediction performance of conventional models.

Redmond, Paul; McGuinness, Seamus

doi: 10.1080/13504851.2019.1686111pmid: N/A

In general, women report greater job satisfaction than men. The existing literature cannot fully explain the nature of this difference, as the gap tends to persist even when controlling for job characteristics. In this paper, we study job satisfaction using recent data for 28 EU countries. Women, on average, are more satisfied than men and the gap remains even when we account for a wide range of personal, job and family characteristics. However, the gap disappears when we include job preferences, as women place greater importance on work-life balance and the intrinsic desirability of the work.

Franses, Philip Hans

doi: 10.1080/13504851.2019.1686115pmid: N/A

Many forecasting studies compare the forecast accuracy of new methods or models against a benchmark model. Often, this benchmark is the random walk model. In this note, I argue that for various reasons an IMA(1,1) model is a better benchmark in many cases.

de Bruin, Anne; Agyemang, Abraham; Chowdhury, Md Iftekhar Hasan

doi: 10.1080/13504851.2019.1686453pmid: N/A

We study suicide rates across 17 countries, focusing on the relationships between suicide, and economic policy uncertainty, voice and accountability, and political stability. Results show high economic policy uncertainty is associated with increased suicides, suicide rates tend to increase in countries with lower voice and accountability and high political instability.