Hierarchical Bayes Mixed logit modelling for purchase car behaviour

Il presente lavoro analizza il comportamento d’acquisto di automobili a carburanti tradizionali e alternativi, utilizzando dati italiani di preferenze di scelta dichiarate. Proponiamo un modello Gerarchico Bayesiano Mixed Logit (HBML) flessibile che ci permette di tener conto delle possibili dipendenze dei parametri casuali relativi agli attributi delle automobili testate alle caratteristiche individuali, quali età e genere. Inoltre, il modello proposto consente di aggiungere facilmente parametri specifici dell’alternativa e correlazione tra le alternative. Abbiamo effettuato una rassegna della letteratura sulla scelta d’acquisto di veicoli, selezionando in particolare le applicazioni di modelli a scelta discreta in cui è stato adottato un approccio bayesiano. Essa rivela che il nostro studio sembra essere la prima applicazione di modelli HBML che analizzano questo tipo di scelte. Inoltre, al fine di approssimare la distribuzione congiunta a posteriori dei parametri e gli iper-parametri del modello, in questo lavoro viene utilizzato il più efficiente campionatore Monte Carlo Hamiltoniano, invece di uno dei più tradizionali metodi Markov Chain Monte Carlo (MCMC) come ad esempio il campionatore di Gibbs. I risultati dei modelli dimostrano l’utilità del metodo proposto.This paper analyses the purchase behaviour for conventional and alternative fuel cars, using Italian stated preference discrete choice data. We propose a flexible Hierarchical Bayesian Mixed Logit (HBML) model that permit us to take into account of possible dependences of the car attribute random parameters on individual characteristics, like age and gender. Moreover, alternative- specific parameters and correlation across alternatives have been easily added to the model. We carried out a survey of the literature on vehicle purchase choice selecting applications of discrete choice models in which a Bayesian approach was adopted. It reveals that our study seems to be the first application of HBML models to analyse this type of stated choices. Moreover, in order to approximate the joint posterior distribution of both the model parameters and hyper-parameters, in this paper we use the most efficient Hamiltonian Monte Carlo sampler, instead of considering the more traditionally Markov Chain Monte Carlo (MCMC) methods as e.g. Gibbs sampler. The modelling results show the usefulness of the proposed method

Are funding of pensions and economic growth directly linked? New empirical results for some OECD countries

We empirically test on a panel of OECD countries the hypothesis of a direct and positive link between funding of pensions and economic growth, which is based on the idea that richer pension systems can accelerate the development of the financial system and thus promote a more efficient capital allocation. We follow Davis and Hu (2008) [Davis and Hu (2008), Does funding of pensions stimulate economic growth?, Journal of Pension Economic and Finance, Cambridge University Press, vol. 7 (02), 221-249] in estimating a modified Cobb-Douglas production function, where pension fund assets are treated as a shift factor, but we criticize their results from an econometric point of view, since both the Dynamic OLS and Mean Group (MG) estimators are inadequate in case of cross-sectionally correlated residuals. Indeed, we find a highly significant level of correlation in the MG residuals across countriesthat we attribute to common global shocks driving per capita outputs. Therefore we adopt a more general approach suitable to the presence of a multifactor error structure. Our results exclude the existence of a long run cointegration relationship between autonomous (or total) pension fund assets and per capita output for our panel of OECD countries, unless, in contrast to the conclusion of the cross-sectional dependence test, we ignore it and assume independence of residuals

Decentralization and growth: Do informal institutions and rule of law matter?

We develop a model of the interactions among decentralization, informal institutions and the rule of law. The model shed light on the ambiguous empirical results reported in the literature regarding the growth effects of the policy of devolving fiscal responsibility to local governments. We find that the distribution of civicness within a country determines the magnitude of the effects of decentralization on its regional convergence, as well as whether decentralization fosters or dumpens the country's national growth. We perform a series of simulated "reforms" using Monte Carlo methods parameterized using OECD contries data set. We then test our findings using a panel data set of 23 OECD countries covering the period 1975-2010. We find that the short and the long run growth effect of decentralization policy depends on the size of the policy reform and can range from extremely negative to positive depending on the rule of law, the level of social capital and its regional dispersion, in line with the model predictions

Non-life insurance consumption in Italy: a sub-regional panel data analysis

Insurance development, Regional panel, Spatial dependence, C31, C33, G22,

Spatial Labor Rigidity and Long Run Growth: the Case of Italian Regional Divide

We propose an endogenous growth model with public capital and an imperfect labor market to account for the long run regional development of the Italian economy. A stylized model of a monopolistic Union characterized by heterogeneity in its members’ reservation wage creates a spatially rigid wage. We then include the above mechanism in a growth model where public investment is subject to installation costs and analyze the effects of policy changes in the period 1951-2004 on the long run growth and unemployment rate of the macro areas of Italy: Center-Northern and Southern. The calibration exercise with parameters values grounded in the economic history literature is then performed. Our results indicate that two permanent institutional innovations deeply affected the long run dynamics of the Italian regional development, both in terms of growth and unemployment: the centralization of the wage bargaining and the decentralization of the governmental functions with the birth of the ordinary regions.Nel presente lavoro proponiamo un modello di crescita endogena con capitale pubblico e mercato del lavoro imperfetto per spiegare lo sviluppo di lungo periodo dell’economia italiana. Un modello stilizzato di Sindacato monopolistico caratterizzato da eterogeneità nei salari di riserva dei suoi membri determina un salario rigido in senso spaziale. Inseriamo poi tale meccanismo in un modello di crescita nel quale l’investimento pubblico è soggetto a costi di installazione e analizziamo gli effetti dei cambiamenti nelle politiche nel periodo 1951-2004 sulla crescita di lungo periodo e sul tasso di disoccupazione delle due macro aree d’Italia: il Centro-Nord e il Sud. Nel lavoro effettuiamo inoltre un esercizio di calibrazione del modello con i valori dei parametri determinati sulla base della letteratura esistente sulla storia economica italiana. I nostri risultati indicano che due innovazioni istituzionali di tipo permanente hanno avuto effetti profondi sulla dinamica di lungo periodo dello sviluppo regionale italiano, sia in termini di crescita che di disoccupazione: la centralizzazione della contrattazione sul salario e la decentralizzazione delle funzioni di governo con la nascita delle regioni ordinarie

Insurance in Italy: a spatial perspective

The authors analyze the demand for life and non-life insurance across 103 Italian provinces in 1994-2004, assessing the determinants of insurance consumption in the light of the empirical literature and the distinctive features of the Italian market, which we thoroughly describe. The authors discuss common issues in the empirical literature on insurance development, presenting the sub-regional perspective as a partial solution; at the same time, they elaborate on the peculiar issues arising from the use of sub-regional data: spatial heterogeneity and spatial correlation. They describe the evolution of provincial heterogeneity and of the spatial features of the data over the observation period. In order to control for both unobserved heterogeneity and spatial correlation, they specify a spatial panel model with random provincial effects and macroregional fixed effects, which is estimated by maximum likelihood. The chapter carefully assesses the properties of model residuals, concluding that the specification allows for reliable inference on the drivers of insurance consumption. It concludes describing the empirical findings and giving some suggestions for future research

Hierarchical Bayes Mixed logit modelling for purchase car behaviour

This paper analyses the purchase behaviour for conventional and alternative fuel cars, using Italian stated preference discrete choice data. We propose a flexible Hierarchical Bayesian Mixed Logit (HBML) model that permit us to take into account of possible dependences of the car attribute random parameters on individual characteristics, like age and gender. Moreover, alternative-specific parameters and correlation across alternatives have been easily added to the model. We carried out a survey of the literature on vehicle purchase choice selecting applications of discrete choice models in which a Bayesian approach was adopted. It reveals that our study seems to be the first application of HBML models to analyse this type of stated choices. Moreover, in order to approximate the joint posterior distribution of both the model parameters and hyper-parameters, in this paper we use the most efficient Hamiltonian Monte Carlo sampler, instead of considering the more traditionally Markov Chain Monte Carlo (MCMC) methods as e.g. Gibbs sampler. The modelling results show the usefulness of the proposed method.JRC.J.1-Economics of Climate Change, Energy and Transpor

TheConvergence of the Italian Regions and Unemployment: Theory and Evidence

We explore the links between the halt of the convergence process of Italian regions at the beginning of the 1970s and the increase in regional unemployment dispersion. We consider a neoclassical exogenous growth model with an imperfect labor market and show that during the transitional dynamics the imperfections of the labor market negatively influence the output growth rate. In particular, the model implies that centralized bargaining is likely to set a national minimum wage that is too high with respect to the labor productivity of the less developed regions, resulting in a negative impact on their per capita output growth. We test the implications of the model on a regional panel data set using the GMM framework. Both our market distortion measure and the unemployment rate are found to significantly lower the growth rate of per capita output. Copyright 2002 Blackwell Publishers Inc.