Should industrial policy be targeted to a few sectors or be more broad based and therefore more neutral? Our theoretical analysis demonstrates that access to foreign markets is key to answering this question. We show that in a less open economy, industrial policy should be targeted, while in a...

We test for emerging economies the hypothesis - previously verified for G-10 countries only - that the enforcement of bank capital asset requirements (CARs) exerts a detrimental effect on the supply of credit. The econometric analysis on individual bank data suggests three main results. First,...

The relationship between financial development and economic growth has received enormous attention in the economic literature of the last decade. The widely accepted consensus finding is that financial development has a positive effect on growth at either aggregate, or industry or firm levels....

This study proposes a novel approach to estimating a travel cost model that accounts for intrahousehold resource allocation. We define it ‘Collective Travel Cost Method’ (CTCM). The technique is based on an analogy borrowed from the literature of collective household behavior and adapted to...

Do good looks make people more productive? An impact of looks on earnings has been found in the empirical literature: plain people earn less than average-looking people who earn less than the good-looking. However, an important question remains unanswered: is the impact of beauty due to pure...

This paper aims at characterizing the dynamics of R&D competition within the pharmaceutical domain, focusing on the role of patent disclosure, the extent of uncertainty, and role of scientific advances. Following the empirical literature in the economics of innovation, we employ patents as a...

The paper designs an optimal payment system for a group of producers implementing it empirically. It shows how to implement the first best through higher prices for better quality commodities, deriving the optimal pricing schedule. It also takes into account producers' heterogeneity by modelling...

Negative values for estimated variances can arise in a panel data context. Empirical and theoretical literature dismisses the problem as not serious and a practical solution is to replace negative variances by its boundary value, i.e. zero. While this is not a concern when the individual...