In the capital asset pricing model (CAPM), estimating beta consistently is important to obtain a consistent estimate of the price of risk. However, it is often found that the estimate of beta is sensitive to the choice of portfolios used in the estimation. This paper provides a new test to...

In this paper we investigate how tightening fiscal constraints (e.g., through intergovernmental transfer cuts) can lead local governments to postpone investments’ payments. We first provide a simple model showing how local governments can use arrears to relax their short-run financial...

In the present paper we attempt to analyse the relationship between ‘lifestyle’ and happiness in the UK using an instrumental variable approach. Our lifestyle variables have a significantly positive impact on happiness and the impact increases with the use of instruments. This suggests that...

This paper explores the causal relationship between female education and teenage fertility by exploiting a change in the compulsory schooling law (CSL) in Turkey. Using variation in the exposure to the CSL across cohorts and variation across provinces by the intensity of additional classrooms...

In this paper we use novel historical data on economics and social rights from the constitutions of 201 countries and an instrument variable strategy to answer two important questions. First, do economic and social rights provisions in constitutions reduce poverty? Second, does the strength of...

Economists often interpret absenteeism as an indicator of effort. Using data from the German Socio-Economic Panel (SOEP) study, this paper offers a comprehensive discussion of this view by analysing various forms of job mobility. The evidence reveals a significantly negative (positive) link...

This paper estimates the effect of having children on labor force participation of mothers in urban Iranian areas. I exploit sex composition of children as an exogenous source of variation in family size to account for endogeneity of fertility. Using information from the Iranian Household Income...