infonet-economy

How does the market for corporate control reallocate firm ownership in response to adverse aggregate financial shocks? To answer this question, we develop a tractable model of mergers and acquisitions (M&As) where firms facing different degrees of financial constraints acquire ownership of illiquid domestic firms. We show that acquisitions by financially constrained acquirers, on…

This paper contributes the on-going debate on income inequality in advanced economies with a proposal aimed at reducing costly investment mistakes that are prevalent among middle-class households. The paper starts by describing how households should invest, compares it with what we know about how households do invest, and highlights discrepancies between the two (investment mistakes…

While there is considerable literature attempting to model current account, there are not many studies to forecast current account balance. This study gives a comprehensive way to model and predict current account deficit (CAD) by evaluating the forecasting performance of direct and indirect approach. At the disaggregated level, I use two variants to model current account components…

Does the government control of school systems facilitate equality in school quality? Whether centralized or localized control produces more equality depends not only on what ‘could’ happen in principle, but also on what does happen in practice. We use the Programme for International Student Assessment (PISA) database to examine the association between school sector and the variance…

Countries with weaker domestic investor protection hold less diversified international portfolios. An equilibrium business cycle model of North-South capital flow with corporate governance frictions between outside investors and corporate insiders explains this phenomenon through two channels. First,weak governance leads to concentrated ownership in the South because international…

We revisit the simultaneous equations model of rebellion, mobilization, grievances and repression proposed by Gurr and Moore (1997). Our main contribution is to clarify and improve on the underlying identification strategy and to emphasize the role played by the institutional environment. Instrumental variables estimates for post-colonial societies reveal that the strength of the…

This paper presents an impact evaluation of three nutritional programs implemented in Puebla, Mexico, run by SEDIF, a social assistance institution. The present study uses both a propensity score matching and weighting in order to balance the treatment and the control groups in terms of observable characteristics, and to estimate, later on, the causal effect of the programs on…

Microfinance has played a key role in including the poor in financial markets. This paper uses microfinance data to approximate financial inclusion in the poorer segments of the population and proposes a quantile regression approach to study the development of microfinance markets. Our approach accounts for the dynamic and heterogeneous impacts that key drivers may have across…

The trade linked to international production networks – supply-chain trade for short – is associated with momentous global economic changes. This paper presents a portrait of the global pattern of supply-chain trade and how it has evolved since 1995. The paper draws on a variety of data sources but most heavily on the recent World Input-Output Database. China’s supply-chain trade…