218 research outputs found
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Grey power and the economy: ageing and inflation across advanced economies
What explains the cross-national variation in inflation rates across countries? In contrast to most literature, which emphasises the role of ideas and institutions, this paper focuses on electoral politics and argues that ageing leads to lower inflation rates. Countries with a larger share of elderly exhibit lower inflation because older people are both more inflation averse and politically powerful, forcing parties seeking their votes to pursue lower inflation. Logistic regression analyses of survey data confirm that (1) older people are more inflation averse and (2) more likely to punish incumbents for inflation. Panel data regression analysis shows that (3) social democratic parties have more economically orthodoxy manifestos in European countries with more elderly people and that (4) the share of elderly is negatively correlated with inflation in both a sample of 21 OECD economies and a larger sample of 175 countries. Ageing therefore pushes governments to pursue lower inflation
Foreign equity portfolio flow and corruption: a cross-country evidence
This study examines the impact of foreign equity portfolio investment on corruption. Employing a large dataset of 44 countries from 2001 to 2015 and three different measures of corruption, our results show that foreign investors from well-governed countries tend to foster public accountability, reduce asymmetry information and corruption. We find empirical evidence that foreign equity portfolio investment interacts with stock market development and central bank transparency to reduce corruption. Our results suggest that stock market development and central bank transparency are regarded as complementary by international portfolio investors. Further analysis indicates that corruption appears more prevalent in countries where domestic investors dominate the stock market. Our results are robust to endogeneity using dynamic generalized methods of moments (GMM). The findings suggest that attracting foreign equity investors reduces corruption, implying significant benefits for portfolio diversification
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