The Determinants of Relative Price Variability: Further Evidence from Argentina

This paper analyses the relative price variability (here after, RPVI) for Argentina from 1960 to 1993. We have distinguished a first period (1960-1975) with a moderate and stable inflation and a second one (1975-1993) with four inflation regimes: moderateRelative price Variability, inflation regimes, markov switching model, inflation components

The Relevance of Supply Shocks for Inflation: The Spanish Case

This paper analyses the effects of supply shocks on the Spanish inflation rate. The methodology applied is based on Ball and Mankiw (1995). These authors assume that a good proxy for supply shocks is the third moment of the distribution of price changes, and show that nominal rigidities imply a positive relation between inflation and skewness, that is magnified by the variance of the distribution. The main data used are the monthly consumer price indexes of each region, disaggregated in 57 categories, for the 1993-2005 period. We estimate the relation between mean inflation and the higher moments of the distribution, including several control variables. The analysis has been carried out in two ways: firstly, each region is analysed separately and, secondly, we have used panel data techniques in order to test the homogeneity across regions. Our results point out that Spanish regions show a common pattern with regard to the nominal rigidities detected, and that the Spanish economy is vulnerable to supply shocks.Inflation, nominal rigidities, skewness, supply shocks, Spanish regions

Exploring the links between tourism and quality of institutions

This paper introduces a new perspective on the impacts of tourism on host communi-ties by analyzing the links between tourism specialization and quality of institutions. Our research has two principal aims: firstly, to test the significance and sign of this relationship; and secondly, to explore the channels through which tourism could affect institutional qual-ity. To this end, an econometric analysis is conducted using a sample of 92 countries over the period 1995-2014. The results indicate that there is a significant and positive associa-tion between tourism specialization and institutional quality. Moreover, this relation can be explained through three main channels: level of income, income inequality, and economic freedom.Este trabajo aporta una nueva perspectiva sobre los impactos del turismo analizando las relaciones entre la especialización turística de un país y la calidad de sus instituciones. La investigación plantea dos objetivos: (1) testar empíricamente la significatividad y signo de dichas relaciones y (2) explorar los canales a través de los que se producen. Realizamos un análisis econométrico para 92 países y 20 años. Los principales resultados indican la existencia de una asociación significativa y positiva entre turismo y calidad institucional que se produce principalmente a través de tres canales: nivel de renta, distribución de la renta y libertad económica

Ethnolinguistic Diversity and Education: a Successful Pairing

The many growing migratory flows render our societies increasingly heterogeneous. From the point of view of social welfare, achieving all the positive effects of diversity appears as a challenge for our societies. Nevertheless, while it is true that ethnolinguistic diversity involves costs and benefits, at a country level it seems that the former are greater than the latter, even more so when income inequality between ethnic groups is taken into account. In this respect, there is a vast literature at a macro level that shows that ethnolinguistic fragmentation induces lower income, which leads to the conclusion that part of the difference in income observed between countries can be attributed to their different levels of fragmentation. This paper presents primary evidence of the role of education in mitigating the adverse effects of ethnolinguistic fractionalization on the level of income. While the results show a negative association between fragmentation and income for all indices of diversity, the attainment of a certain level of education, especially secondary and tertiary, manages to reverse the sign of the marginal effect of ethnolinguistic fractionalization on income level. Since current societies are increasingly diverse, these results could have major economic policy implications

Relative Prices and Inflation: New Evidence from Different Inflationary Contexts

This paper analyzes the relationship between inflation and relative price variability, in the direction of the latter, in two countries with very different inflationary experiences: Argentina and Spain. To address this objective, using disaggregated price indexes (Wholesale Price Index for Argentina and Consumer Price Index for Spain), we delimitate different inflationary regimes and compute a set of regressions for each country. Our results suggest evidence in favor of the non-neutrality of inflation (mostly in hyperinflation periods) and do not support neither the menu costs nor the signal extraction approaches. We also detect significant structural changes in the relationship depending on the inflationary regime.inflation, relative price variability, inflation regimes, inflation volatility,expected and unexpected inflation.

Cournot equilibria for socially responsible firms in an uncertain environment

This paper considers firms which compete under Cournot assumptions and in- corporate social responsibility to the evaluation of their results. In our model a socially responsible firm is one which takes into account not only its profits, but also it internalizes its own share of externality and is sensitive to consumer surplus. The analysis of the equilibria to which the firms will eventually arrive is ad- dressed in a framework where the results of the strategic decisions of the firms depend on a future uncertain event and no information about the probability distribution is available.En este trabajo se analiza el efecto de la inclusión de objetivos de responsabilidad social en un modelo de empresas que compiten bajo los supuestos de Cournot. En nuestro modelo una empresa socialmente responsable es aquella que no solo tiene en cuenta sus beneficios, sino que también tiene en cuenta las externalidades positivas generadas por el excedente del consumidor. El análisis de los equilibrios a los que pueden llegar las empresas se realiza en un contexto de incertidumbre. Los resultados de las decisiones estratégicas de las empresas dependen de la realización de un escenario futuro y no se dispone de información sobre las probabilidades de ocurrencia de los posibles escenarios

Análisis de la estructura de la inflación de las regiones españolas: La metodología de Ball y Mankiw

In this paper we analyze the incidence of the distribution of price changes on the inflation rate of Spanish regions (1994-2001). Especially, we pay attention to the role of variability and skewness. The methodology applied is based on the menu cost models developed by Ball and Mankiw. In general, we conclude that the behaviour of the regions is very homogeneous with respect to the "structure" of inflation. The significance of variability and skewness also shows the vulnerability of inflation to relative price shocks.inflation, distribution of price changes, variability, skewness, kurtosis

Renewable Energy and Economic Development. An Analysis for Spain and the Biggest European Economies

Background: This paper assesses the sustainability of the Spanish economic devel-opment model for the period 1980-2010. Moreover, we carry out a comparative analysis with the biggest European economies: France, Germany, Italy and United Kingdom. Methods: In order to achieve the aim of this paper, cointegration techniques have been applied. Through these techniques, we have analyzed the long-term rela-tionship between consumption of renewable and non-renewable and economic development and pollution during the period 1980-2010. After a selection pro-cess, for Spain we have used to measure growth the GDP and the Gross Capital Formation; to measure development, the Index of Human Development and Social Capital; for pollution, the emissions of CO2 and consumption of renew-able energy in the electricity system and oil consumption for the consumption of renewable and non-renewable, respectively. Secondly, we have compared the results obtained for the Spanish economy with the four biggest economies in the European Union: Germany, France, Italy and the United Kingdom. Given the availability of data for these countries Gross Capital Formation and Human Development Index have been excluded from the analysis. Results: First, a positive impact of consumption of renewable and renewable energy on growth and development is found for the five countries under study, with a greater impact of non-renewable energy. For the three countries for which the data for CO2 emissions are available (Spain, France and the UK), it is ob-served that the reducing effect of renewable energy on CO2 emissions is less than the polluting effect of non-renewable energy. Second, for Spain, Germany and France, the data point out a feedback process between the consumption of non-renewable and growth and development, which is not observed with the consumption of renewable energy. Conclusions: In order to reconcile the objective of growth with the reduction of pollution, more moderate growth rates are required. The growth model of the countries analyzed stimulates consumption of non-renewable energy, but not renewable. This result points out the requirement of designing policies that encourage the substitution of non-renewable energy by renewable energy.Antecedentes: Este trabajo evalúa la sostenibilidad del modelo de desarrollo económico español en el periodo 1980-2010. Asimismo, realiza un análisis comparativo con las grandes economías europeas: Alemania, Francia, Italia y Reino Unido. Metodología: Para alcanzar el objetivo del trabajo se han empleado técnicas de cointegración. Mediante estas técnicas se analiza la relación a largo plazo del consumo de energías renovables y no renovables con el desarrollo económico y la contaminación en el periodo 1980-2010. Tras un proceso de selección de variables, para España se ha utilizado el Producto Interno Bruto (PIB) y la Formación Bruta de Capital, para medir el crecimiento, el Índice de Desarrollo Humano y el Capital Social, para el desarrollo, las emisiones de CO2 para la contaminación, el consumo de energía renovable en el sistema eléctrico y el consumo de petróleo para el consumo de energía renovable y no renovable, respectivamente. En segundo lugar, se han comparado los resultados obtenidos para la economía española con las cuatro economías más grandes de la Unión Europea: Alemania, Francia, Italia y Reino Unido. Dada la disponibilidad de datos, para estos países se ha excluido del análisis la Formación Bruta de Capital y el Índice de Desarrollo Humano. Resultados: En primer lugar, para los cinco países analizados se comprueba un impacto positivo del consumo de energía renovable y no renovable sobre el crecimiento y el desarrollo, con un impacto mayor de las energías no renovables. Para los tres países en los que se han incluido las emisiones de CO2 (España, Francia y Reino Unido), el efecto reductor de las renovables sobre las emisiones de CO2 es menor que el efecto contaminante de las no renovables. En segundo lugar, para España, Alemania y Francia se aprecia un proceso de retroalimentación entre el consumo de no renovables, el crecimiento y el desarrollo, que no se observa con el consumo de energía renovable. Conclusiones: Para conciliar el objetivo de crecimiento con el de reducción de la contaminación se precisan tasas de crecimiento más moderadas. El modelo de crecimiento de los países analizados estimula el consumo de energía no renovable, pero no el de las renovables. Esto apunta hacía la necesidad de diseñar políticas que estimulen la sustitución de energía no renovable por renovabl

Do tolerant societies demand better institutions?

The increasing ethnic heterogeneity that many societies are experiencing could be interpreted as a detrimental phenomenon, since empirical literature exists that indicates that higher levels of ethnic fractionalization induce higher levels of corruption. This paper aims to show the role of tolerance in overcoming this harmful effect of ethnic heterogeneity. To this end, a sample of 86 countries is tested for a positive association between ethnic fractionalization and corruption. It is then shown that tolerance offsets this effect through both direct and indirect effects on corruption. In order to analyse the indirect effects, the level of income and the freedom of the press are selected as channels, since these represent two determinants of corruption that are linked to tolerance. Moreover, tolerance and corruption have been modelled as composites. Consequently, Partial Least Squares path modelling (PLS-PM) has been used. For our sample, an index of tolerance towards immigrants and people of different race and an index of corruption are constructed, for which several sources are jointly utilised. Our results appear to indicate that the adverse effect of ethnic fractionalization on corruption is offset by tolerance, which reduces corruption not only directly but also indirectly through the level of income and the freedom of the press

Measuring social diversity in economic literature: an overview for cross-country studies

Over recent decades, the growing research on social diversity at country level has striven to explain several outcomes such as the differences in income across countries and the origins of civil conflicts. The literature employs a wide range of indices to measure social diversity that hinders the comparison of the results with respect to their effects on socio-economic performance. This paper intends to disentangle such a variety of indices and their applications. To achieve this goal, we have collected the social diversity indices used in cross-country studies, and have ascertained not only their similarities and differences, and the relationships between them, but also their main applications. Studies at country level have been selected that construct their own indices and that make their databases available. We show that the dimension and the index chosen to measure social diversity, the level of disaggregation of the social groups, and the geographical unit of analysis explain the tangle of indices and the mixed results achieved by the literature focused on socio-economic outcomes of social diversity. This paper enables the suitable evaluation and comparison of the effects of social diversity and the selection of the appropriate index depending on the analysis to be carried out