•Home country legislation prohibits corrupt practices for inward FDI firms but in some environments this makes them uncompetitive with host country firms.•The propensity to engage in corrupt ...practices in emerging markets is the same for foreign and domestic firms if it is necessary to circumvent cumbersome bureaucracy.•This result is robust to the degree of foreign ownership of a firm.•Propensity score matching provides an unbiased method of comparing sub-groups.
An extensive literature exists on the adverse effects of corruption on inward FDI and the impact this may have on economic development but the reverse causality has not been fully explored. Legislation in the US and the EU prohibits firms from engaging in corrupt practices in foreign countries and this suggests that foreign-owned firms might be less likely to pay bribes. However, such legislation may be ineffective because foreign firms have to adapt to local market conditions or risk being uncompetitive. Using firm-level data for 41 emerging countries, a probit model estimates the probability that a firm pays bribes. To allow for possible endogeneity this probit analysis is repeated with an instrument to proxy for endogenous foreign ownership. Then, a propensity score matching technique tests for differences in the propensity to pay bribes by domestic and foreign firms. The paper finds no difference in the behavior of foreign-owned and domestic firms with respect to corrupt practices. Results are robust to different levels of foreign ownership and support the view that foreign-owned firms adapt to local practices and are neither more nor less likely to pay bribes than comparable domestic firms. The paper finds that other variables including bureaucracy, government contracts, and perceived difficulties with civil society (legal and political) do have statistically significant effects on increasing bribery and that some others, such as per capita GDP, tend to reduce bribery. The study concludes that there is no evidence that foreign ownership, after investment has occurred, tends to reduce bribery but it does support the view that foreign-owned firms adopt local behavioral norms.
This study examines the potential advantages of using Singular Spectrum Analysis (SSA) for forecasting tourism demand. To do this it examines the performance of SSA forecasts using monthly data for ...tourist arrivals into the Unites States over the period 1996 to 2012. The SSA forecasts are compared to those from a range of other forecasting approaches previously used to forecast tourism demand. These include ARIMA, exponential smoothing and neural networks. The results presented show that the SSA approach produces forecasts which perform (statistically) significantly better than the alternative methods in forecasting total tourist arrivals into the U.S. Forecasts using the SSA approach are also shown to offer a significantly better forecasting performance for arrivals into the U.S. from individual source countries. Of the alternative forecasting approaches exponential smoothing and feed-forward neural networks in particular were found to perform poorly. The key conclusion is that Singular Spectrum Analysis (SSA) offers significant advantages in forecasting tourist arrivals into the US and is worthy of consideration for other forecasting studies of tourism demand.
•This study applies Singular Spectrum Analysis (SSA) to forecasting tourist arrivals to the US.•The Vector SSA model outperforms ARIMA, Exponential Smoothing and Neural Networks.•SSA outperforms ARIMA in forecasting U.S. Tourist arrivals by country of origin.•The improvement in performance refers to both short- and long-run.•The results are statistically significant.
PurposeThe choice of Southern Europe is partly based on the observation that the sample includes a number of countries whose economies faced more severe difficulties than elsewhere in Europe. ...Economically they were less able to absorb the economic shock posed by COVID-19. It is also partly based on the characteristics of the pandemic. A number of countries in the sample were amongst the earliest in Europe to be hit by the pandemic and a several were harder hit in terms of both morbidity and mortality.Design/methodology/approachThis study uses evidence from World Bank enterprise surveys of a sample of firms from six countries in Southern Europe. It examines the early evidence of the effects of COVID-19 on labour markets. The economic consequences potentially cover a wide range of issues. The focus of this study is on firm level evidence of the effect on labour. The evidence and the analysis are provided at a time when the pandemic is still in progress. The authors use both traditional regression analysis and IPWRA to assess the joint effect of loans versus government support on, firstly, the change in sales revenues and, secondly, the number of weeks that the firm would expect to survive with no sales revenues.FindingsThe study suggests that, despite efforts to support firms and hoard labour, there is a prospect of a significant number of firm closures with a consequent loss of employment. Temporary firm closures also represent a substantial loss of labour weeks. These are partly related to a significant number of workers subject to furloughs. The empirical findings suggest that COVID-19 cases and deaths have directly affected firm sales but government containment measures, particularly closures, have more strongly affected firms. Losses of sales were unsurprisingly related to losses of employment. Remote working has contributed to sustaining employment but online business has not affected most sectors.Research limitations/implicationsThe future progress of COVID-19 and government containment measures is uncertain, and the full economic consequences will probably continue to emerge after the end of the pandemic. The full extent of the impact on labour will probably not be the first of these. There are obvious advantages in seeking to learn lessons from the early stages of the pandemic but there are also obvious constraints. The full economic consequences will take longer to emerge than the pandemic itself and the full consequences for employment will take longer to be evident than many other economic effects.Practical implicationsBoth temporary closures and furloughs impose costs that will be borne by firms, workers and government. The effects of COVID-19 on firms differ across sectors. Adverse effects tend to be higher in hospitality, non-essential retail and travel. That many firms lack the capacity to survive further temporary closures of a similar duration to those in the earlier stages emphasises that the support provided in the near future is of critical importance to control employment losses through permanent firm closures. A long-term perspective suggests neither permanent closure nor laying off workers may be the best response to a temporary crisis in demand. A stakeholder model of the firm would often suggest that it is not an optimal for the point of view of workers or the wider economy either. Both imply a preference for labour hoarding.Social implicationsThe most affected are sectors with a high proportion of female workers and, in consequence, most of the countries in the sample exhibit an early decline of the already lower than average share of women in employment.Originality/valueThe data used have been recently released and this is the first analysis using the data to look at the consequence on firms employment decisions during the Pandemic. The case of Southern Europe is much understudied, though one of the most dramatic as to the consequences of the pandemic. From a methodological point of view, the authors use not only traditional regression analysis, but also the matching approach to identify the effect of different policy options on labour demand by firms.
This study considers the economic impact of coronavirus disease 2019 (COVID-19) on commercial enterprises in four Central American countries – El Salvador, Guatemala, Honduras, and Nicaragua. At the ...time of analysis, neither the pandemic nor its economic consequences had fully run their course. It is not, therefore, a definitive analysis, but it is important to try to draw important lessons as soon as possible. The main focus of the study was the initial impact on labor markets. The analysis was based on World Bank Enterprise Surveys undertaken before the outbreak of COVID-19 and follow-up surveys on the effects of the pandemic, also undertaken by the World Bank (
: Enterprise Surveys, The World Bank,
). These were combined with data on both government containment measures and rates of morbidity and mortality. The use of enterprise data to analyze labor market issues has some limitations but also many strengths. The data are useful for analyzing the consequences for gender equality in employment. Since the demand for labor is a derived demand, firm-level data provide a clear link to labor market effects. The pandemic has caused a significant loss in sales for many firms. This has created a loss of liquidity, which, in turn, has caused some firms to reduce employment, working hours, and wages. Government containment measures necessary to save lives, such as temporary workplace closures, have added to the burden for both firms and employees. The study starts by using the surveys to identify the important stylized facts. Although some issues are already well documented anecdotally through media reports, this method provides a more evidence-based approach. It also helps identify several issues, such as the impact on gender equality, which has received less journalistic attention. The study is further supported by a regression analysis (ordinary least squares and seemingly unrelated regression equations models) of several key outcomes (changes in sales, employment, the share of females in employment, and expectations of firm survival). A limitation of such an analysis at any enterprise level is heterogeneity and, consequently, a risk of sample selection bias. To provide robustness checks, we use a matching approach. The results suggest that a significant proportion of surviving firms are vulnerable to permanent closure. The ability of firms to retain labor depends on sales, which are affected by both the pandemic itself and the government containment measures. Only a small proportion of firms have received government support, and there is evidence that it could help both firm survival and the retention of labor. There is some doubt whether the four countries have the institutional capacity to provide effective support. If such doubts prove well founded, then support may need to be externally driven.
► Analyses US inward investment using techniques associated with factor proportions. ► Finds that both skilled (educated) labour and computer usage are important in US inward FDI. ► The same high ...skill, high tech sectors are also the ones with higher productivity growth. ► Econometric analysis supports OLI theory and in particular knowledge (strategic asset) seeking. ► Strategic asset seeking behaviour overlaps with both market and efficiency seeking influences.
This paper examines variations in wages for tourism and tourism-associated industries in the USA for the period 2004–2009. It critically assesses the extent to which tourism and tourism-associated ...activities conform to their low-wage stereotype and finds this to be true in general, but not universally. It then considers the possibility that wages in US tourism and tourism-associated industries can be explained by observable characteristics of these industries. Recent research suggests that the use of wage data at the level of highly detailed occupations is an effective alternative to other ways of capturing underlying skill differences. Accordingly, data from the US Occupational Employment Statistics (OES) were used to provide this detail. The results strongly support the importance of difference in wages between occupations in understanding differences between industries. They also support the importance of a number of industry characteristics, including profitability, multi-factor productivity and demand growth. The paper also considers the relevance of an industry wage premium or discount for tourism and tourism-associated activities in the USA over the same period. It estimates an industry wage model separately for five individual occupations across all industries that employ for the occupation concerned. The analysis shows that workers in the two more highly paid occupations exhibit evidence of a tourism and tourism-associated discount but that workers in the three more lowly paid occupations exhibit a tourism and tourism-associated wage premium.
The gender pay gap in the USA Meara, Katie; Pastore, Francesco; Webster, Allan
Journal of population economics,
01/2020, Letnik:
33, Številka:
1
Journal Article
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This study examines the gender wage gap in the USA using two separate cross-sections from the Current Population Survey (CPS). The extensive literature on this subject includes wage decompositions ...that divide the gender wage gap into “explained” and “unexplained” components. One of the problems with this approach is the heterogeneity of the sample data. In order to address the difficulties of comparing like with like, this study uses a number of different matching techniques to obtain estimates of the gap. By controlling for a wide range of other influences, in effect, we estimate the direct effect of simply being female on wages. However, a number of other factors, such as parenthood, gender segregation, part-time working, and unionization, contribute to the gender wage gap. This means that it is not just the core “like for like” comparison between male and female wages that matters but also how gender wage differences interact with other influences. The literature has noted the existence of these interactions, but precise or systematic estimates of such effects remain scarce. The most innovative contribution of this study is to do that. Our findings imply that the idea of a single uniform gender pay gap is perhaps less useful than an understanding of how gender wages are shaped by multiple different forces.
This study contributes to the rapidly growing literature on women in tourism. It focuses on a group of 13 Caribbean countries. The study analyses the impact of women in apical positions within firms ...(top manager or owner) on firm performance—productivity, profitability and female employment. For this both a decomposition model and the inverse probability weighted regression adjustment estimator are used. The analysis finds that opportunities for women in these positions in the Caribbean are constrained to less productive and profitable firms, as elsewhere. However, those firms with females at the top employ more women, particularly in management roles.
This paper argues that the underlying supply and demand analysis of fossil energy and other environmental taxes needs further elaboration when a country (a) introduces national fossil energy or ...environmental taxes and (b) is open to international trade at given world prices. We provide evidence that such conditions are plausible for many sectors in the UK. A key implication is that the short run effects of such taxes should not be felt in final good prices, since these are determined in world markets, but in terms of underlying profitability. These changes in underlying profits provide two key incentives for producers—to change to more environmentally friendly production techniques and to switch resources to production of less environmentally harmful goods. Using input—output techniques we provide evidence for the UK to show how existing fossil energy and other “green” taxes have affected underlying profitability. The evidence shows quite strong profit incentives to shift resources from a small number of energy intensive industries to others.
•Energy taxes affect profits more than prices for sectors trading at world prices.•This study suggests that many sectors in the UK satisfy these conditions.•Our evidence suggests that few sectors are strongly affected by energy taxes.•Energy taxes have a strong effect relative to other possible environmental taxes.
This study contributes to the FDI literature by investigating the impact of all four locational motives of FDI in Sub-Saharan African (SSA) countries for the period 1996–2010. To achieve this aim, ...panel data techniques (pooled OLS, fixed effects and GMM) were employed on a sample of SSA countries. The empirical results showed that efficiency and strategic asset seeking factors influenced FDI activities in SSA for the period investigated. Market size also influenced FDI however this was less robust to specifications. Surprisingly, FDI in SSA was not resource seeking. Furthermore, a statistical test confirmed structural and behavioural differences in FDI determinants between SSA sub-regional groups and when analysed separately, FDI in West and Central SSA was market and efficiency seeking while FDI in South and East Africa was best explained by efficiency seeking factors. Based on the empirical findings, a number of policy implications were derived. These policy implications include further implementation of policies targeted at increasing and sustaining trade liberalisation and trade diversification, control of corruption, credible upgrades and productive investments in infrastructure, and support for human capital accumulation as FDI is increasingly directed towards R&D, innovation and strategic asset activities.
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