We estimate a model of homogeneous capital investment with two installation possibilities - replacement and expansion using observations at the establishment level. We find that regime switches identified by "ad hoc" measures of lumpy investment do not adequately distinguish expansionary from...

This article derives generalized method of moment-based Wald tests for conditional convergence in terms of the second and third central moments (conditional "σ"- and "ζ"-convergence). Monte Carlo simulations indicate that the proposed tests are properly sized and equipped with enough power for...

In this paper we test the existence of forward-looking behaviour in a multivariate model for alcohol and tobacco consumption. The theoretical framework, based on a dynamic adjustment cost model with forward-looking behaviour, is enhanced to include the intertemporal interactions between the two...

Although control variables are the reason for multiple regression, surprising little attention is given to the process of locating and selecting the controls. If important controls are omitted, estimates can be biased and inconsistent whereas using too many controls can reduce efficiency and...

This article suggests an alternative formulation of the cointegrated vector autoregressive (VAR) model such that the coefficients for the deterministic terms have straightforward interpretations. These coefficients can be interpreted as growth rates and cointegration mean level coefficients and...

We use panel probit models with unobserved heterogeneity, state dependence and serially correlated errors in order to analyse the determinants and the dynamics of current account reversals for a panel of developing and emerging countries. The likelihood-based inference of these models requires...

How individual wages change with time is one of the crucial determinants of labour market decisions including the timing of retirement. The focus of this paper is the relationship between age and wages with special attention given to individuals nearing retirement. The analysis is presented in a...

In the Stackelberg duopoly experiments in <link rid="b13">Huck "et al." (2001)</link>, nearly half of the followers' behaviours are inconsistent with conventional prediction. We use a test in which the conventional self-interested model is nested as a special case of an inequality aversion model. Maximum likelihood...

We introduce a new methodology to target direct transfers against poverty. Our method is based on estimation methods that "focus on the poor". Using data from Tunisia, we estimate 'focused' transfer schemes that highly improve anti-poverty targeting performances. Post-transfer poverty can be...