263 research outputs found
Education and Labor-Market Discrimination
We propose a model that combines statistical discrimination and educational sorting that explains why blacks get more education than do whites of similar cognitive ability. Our model explains the difference between blacks and whites in the relations between education and AFQT and between wages and education. It cannot easily explain why, conditional only on AFQT, blacks earn no more than do whites. It does, however, suggest, that when comparing the earnings of blacks and whites, one should control for both AFQT and education in which case a substantial black-white wage differential reemerges. We explore and reject the hypothesis that differences in school quality between blacks and whites explain the wage and education di%uFB00erentials. Our findings support the view that some of the black-white wage di%uFB00erential reflects the operation of the labor market.
Functional Outcome in Bipolar Disorder: The Big Picture
Previous research on functional outcome in bipolar disorder (BD) has uncovered various factors that exacerbate psychosocial disability over the course of illness, including genetics, illness severity, stress, anxiety, and cognitive impairment. This paper presents an integrated view of these findings that accounts for the precipitous decline in psychosocial functioning after illness onset. The proposed model highlights a number of reciprocal pathways among previously studied factors that trap people in a powerful cycle of ailing forces. The paper discusses implications to patient care as well as the larger social changes required for shifting the functional trajectory of people with BD from psychosocial decline to growth
I Waive My Right To Read This Recommendation: A Theoretical Analysis of the Buckley Amendment
A review of the Energy Productivity Center's Least-Cost Energy Strategy study
The Mellon Institute's Energy Productivity Center (EPC) has recently completed a study asking the question, "How would the nation have provided energy services in 1978 if its capital stock had een reconfigured to be optimal for actual 1978 energy prices?" Interest in this question is motivated by the unanticipated increases in oil prices since 1973. If policy makers are to learn from history it is important to know what would have happened if the increases in energy prices had been foreseen and if the nation had taken full advantage of that knowledge to minimize costs.EPC concludes that if the 1978 capital stock had been transformed in conformance with a least-cost principal for providing energy services, then, given actual 1978 energy prices and energy service demands, per capita energy service costs would have been reduced by 17%. Market shares of the various energy types would also have been affected substantially. For example, while the gas share of total energy service demand would have increased slightly from actual 1978 levels, the share of purchased electricity would have fallen from 30% to 17% of total energy service demand, and improvements in energy efficiency would have increased from 10% to 32%.EPC's findings have received considerable attention, both from the press and from policy makers. EPC interprets its results as indicating "... the direction in which we coul move to begin realizing some of the benefits of a least-cost strategy." The purpose of this report is to assess and evaluate the EPC methodology, data base, and results. Here we briefly summarize our principal findings
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Effects of insider trading under different market structures
In this paper, we study the relationship between the market structure in the real sector and the effects of insider trading. We find that the market structure in the real sector matters. When the monopolist insider chooses the price of the real good rather than the output, insider trading increases the price rather than the quantity. When the insider competes with another firm in the real sector, and chooses quantity, the output increases due to insider trading but by less than in monopoly models. In addition, the stock price is more informative than in monopoly models
SME's lending and Islamic finance. Is it a “win–win” situation?
Information asymmetry is a common feature that hinders lending to small and medium enterprises (SMEs). In the last decade, the growth in Islamic banks lending to SMEs was overwhelming to the extent that it prompted practitioners to regard this as a “win–win” situation. Unlike a conventional bank that mainly resorts to relationship banking to SMEs, an Islamic bank uses a Murabaha contract that creates a “collateral-by-contract” to the borrower. Such distinct lending approaches by the two types of banks have an implication on banks' cost curves that arise from differences in monitoring cost. In this article, we develop a two-stage competition model to investigate the growth in SMEs lending by Islamic banks. In our theoretical model Islamic and conventional banks compete with prices at the first stage (Bertrand framework) and with loan output at the second stage (Cournot framework). Our results reveal that in price competition an Islamic bank will gain market share initially due to its differentiated product. However, in the second stage, the amount of lending to SMEs by Islamic banks decreases due to market share competition
The Effect of Bank Competition on the Bank's Incentive to Collateralize
It has been argued that competing banks make inefficiently frequent use of collateralization in situations where they are better able to evaluate a project's risk than entrepreneurs. We study the bank's choice between screening and collateralization in a model where banks do not have this superior screening skill. In particular, we study the effect of bank competition on this choice. We find that competing banks use collateral less often than a monopolistic bank because competition will intensify if both banks collateralize. Moreover, bank competition is welfare improving if collateralization is rather costly
Competition and financial constraints: a two-sided story
This paper examines the relation between competitive pressure and financial constraints
using firm-level survey data from 27 emerging economies of Eastern Europe and Central
Asia for the years 2005 and 2009. In the empirical analysis, we disentangle the impact of
product market competition on the demand and supply of credit. Our results support the
hypothesis that competitive pressure on borrowers affects both sides of the credit market. We
find that in industries with greater competitive pressure firms’ demand for credit is typically
higher but a greater proportion of firms are discouraged from loan application due to greater
cost of credit. Interestingly, we find the detrimental effect of competitive pressure on credit
access breaks down when firms are audited, when they can pledge collateral and when they
engage in export activities. These results point to the role of competitive pressure in the
lenders’ information set when limited information is availabl
The Degree of Judicial Enforcement and Credit Markets: Evidence from Japanese Household Panel Data
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