Measuring Market Power Exertion in the U.S. Ethanol Industry

The objective of this study is to investigate potential market power exertion in the output market of the ethanol-producing sector using the Solow Residual-Based (SRB) test and its different modalities (primal and primal-dual). The markup estimates (Lerner’s index) obtained using ethanol imports and processed crudel oil as instrumental variables to estimate the primal SRB are compared to the primal-dual SRB estimates. For both approaches, a statistically significant positive markup was estimated implying the presense of market power exertion. Both markup estimates are relatively close to each other.Ethanol, Market Power, Lerner's index, Solow Residual, Industrial Organization, Productivity Analysis,

Access to Credit and the Effect of Credit Constraints on Costa Rican Manufacturing Firms

This paper examines the finances and the effect of credit limitations on the behavior and performance of firms in Costa Rica. The study is based on a survey of manufacturing firms conducted by the authors during 2001. The paper characterizes the profile firms’ finances, examines the determinants of firms’ access to banking credit and tries to assess the effect of credit constraints on the behavior and performance of firms. The paper finds that while banks are the main source of credit for larger firms, non-banking credit (trade plus informal credit) remains the leading source of funds for smaller firms. Moreover, own funds and informal credit is a leading form of credit for newly created firms. It is also found that the probability of having banking credit and the fraction of banking credit/total debt is mostly affected by (if anything) characteristics of the firm and not by those of their owners. Indeed, the firm’s value and age, and whether it keeps formal accounting procedures appear as the most relevant determinants of access to banking credit. With respect to the starting up finances of firms, the data is not conclusive on the determinants of banking credit, yet it suggests a negative relationship with the previous entrepreneurship experience of the owner. The paper discusses different explanations, all of which highlight the importance of credit constraints. Adopting ideas from the econometric literature on treatment effects, the paper explores the effect of banking credit on the behavior and performance of firms. Two different methods are used to correct for selection biases: a parametric two-step point method and a non-parametric method that estimates upper and lower bounds for the effects. While the results are not statistically conclusive, both methods do suggest that having access to banking credit positively affects firms’ performance.

Mechanical properties of tungsten alloys with Y2O3 and titanium additions

In this research the mechanical behaviour of pure tungsten (W) and its alloys (2 wt.% Ti–0.47 wt.% Y2O3 and 4 wt.% Ti–0.5 wt.% Y2O3) is compared. These tungsten alloys, have been obtained by powder metallurgy. The yield strength, fracture toughness and elastic modulus have been studied in the temperature interval of 25 °C to 1000 °C. The results have shown that the addition of Ti substantially improves the bending strength and toughness of W, but it also dramatically increases the DBTT. On the other hand, the addition of 0.5% Y2O3, is enough to improve noticeably the oxidation behaviour at the higher temperatures. The grain size, fractography and microstructure are studied in these materials. Titanium is a good grain growth inhibitor and effective precursor of liquid phase in HIP. The simultaneous presence of Y2O3 and Ti permits to obtain materials with low pores presenc

Enforcement, Contract Design, and Default: Exploring the Financial Markets of Costa Rica

This paper examines the institutional determinants of incentives to repay in Costa Rica and their effects on defaults and the design of financial contracts. Enforcement mechanisms help to determine how much is paid back to creditors and how much shareholders receive as dividends. Theoretically, however, the most important effects will be on the observable characteristics of contracts, as rational agents foresee the incentives of other parties. As courts enforce contracts and punish defaulters, they determine the form contracts take and the magnitude and direction of investments. The paper contains findings on the practices of financial intermediaries that are discussed in the context of contract theory, with a focus on the formal financial intermediaries that are scattered throughout the country. Much of the information comes from primary sources, including a sample of almost 1,700 civil trials and a detailed survey on the credit policies of 31 intermediaries. This paper reviews the creditor-borrower relationship at all stages—ex ante, interim, and ex post. The evidence supports the importance of collateral and other ex post repayment incentives. The evidence also suggests that, contrary to the common view, banks are not passive lenders. They remain alert to how well projects perform and rely on previous experience and a rather sophisticated informational network in granting credit.

Bailouts in Costa Rica as a Result of Government Centralization and Discretionary Transfers

This paper investigates the inter-relation between the central government and the municipalities in Costa Rica. It examines episodes in which the central government has bailed out the local governments from their obligations. We employ empirical and descriptive methods to show how discretionary grants relate to the degree of fiscal discipline of the municipality to produce hidden bailouts. Political, demographic, and economic variables explain the allocation of these discretionary transfers. We illustrate the effects of the high concentration of decision-making of the central government on the fiscal performance of the municipalities. The municipalities play a limited role and its functioning largely depends upon the central government. We argue that the national administration would face a high political cost if it did not bail out the local government in several of the episodes studied. Using panel data from 1982-1997 on 81 cantones, we find that the fiscal effort of the local government is reduced by the presence of discretionary grants. The local governments finance local expenses with these discretionary transfers according to our empirical results. As expected from the centralization issue, political variables such as the affiliation of the local administration have significant effects on the resources received by the municipalities.

High resolution observations of Cen A: Yellow and red supergiants in a region of jet-induced star formation?

We present the analysis of near infrared (NIR), adaptive optics (AO) Subaru and archived HST imaging data of a region near the northern middle lobe (NML) of the Centaurus A (Cen A) jet, at a distance of $\sim15$ kpc north-east (NE) from the center of NGC5128. Low-pass filtering of the NIR images reveals strong -- $>3\sigma$ above the background mean -- signal at the expected position of the brightest star in the equivalent HST field. Statistical analysis of the NIR background noise suggests that the probability to observe $>3\sigma$ signal at the same position, in three independent measurements due to stochastic background fluctuations alone is negligible ($\leq10^{-7}\%$) and, therefore, that this signal should reflect the detection of the NIR counterparts of the brightest HST star. An extensive photometric analysis of this star yields $V-I$, visual-NIR, and NIR colors expected from a yellow supergiant (YSG) with an estimated age $\sim10^{+4}_{-3}$ Myr. Furthermore, the second and third brighter HST stars are, likely, also supergiants in Cen A, with estimated ages $\sim16^{+6}_{-3}$ Myr and $\sim25^{+15}_{-9}$ Myr, respectively. The ages of these three supergiants are in good agreement with the ages of the young massive stars that were previously found in the vicinity and are thought to have formed during the later phases of the jet-HI cloud interaction that appears to drive the star formation (SF) in the region for the past $\sim100$ Myr.Comment: 11 pages, 6 figures, 2 tables, accepted for publication in Ap