1. Evdokimov, P., Rustichini, A. “Forward induction: Thinking and behavior” Journal of Economic Behavior & Organization 128 ( August, 2016) 195–208..
Abstract:
Forward induction (FI) thinking is a theoretical concept in the Nash refinement literaturewhich suggests that earlier moves by a player may communicate his future intentions toother players in the game. Whether and how much players use FI in the laboratory is stillan open question. We designed an experiment in which detailed reports were elicited fromparticipants playing a battle of the sexes game with an outside option. Many of the reportsshow an excellent understanding of FI, and such reports are associated more strongly withFI-like behavior than reports consistent with first mover advantage and other reasoningprocesses. We find that a small fraction of subjects understands FI but lacks confidence inothers. We also explore individual differences in behavior. Our results suggest that FI isrelevant for explaining behavior in games.
2. DaRocha, J., García Cutrín, J., Hastie, L. “To land or not to land: How dos take holders perceive the zero discard policy in Europe an small-scale fisheries?” Marine Policy 71 (2016) 166–174
Abstract:
The landing obligation recently adopted by the European Union's(EU) Common Fisheries Policy aims to eradicate discards in EU fisheries. The objective of this paperisto investigate the potential socialand economic impact sof the discard banin European small-scale fisheries (SSF) and the critical factors forits successful implementation. An exhaustive systematic literature review and astake holder consultation we recarried out inorder to(i) collect detailed information about current knowledge on discards in EU SSF and gauges take holder perceptions about potential impact softhe discard banin EuropeanSSF,(ii) examine the capacity ofthe SSF industryto implement the discard ban,and(iii )explore the limits and feasibility of implementing such a measure. The results of this studys how that little attention has been given by the scientific communityto discards in EUSSF. Indeed, the system a tic literature review shows that this problem is relativelyun- explored in the EU. Inaddition,the effectiven essofa discard banin industrial fisheries is still nclear, mainly because discardd ataare not systematically collected by fisheries authorities. Stake holders mostly perceive that the new landing obligation was developed with industrial fisheries in mind and that compliance with the landing obligation in EUSSF will be difficult to achieve without high economic costs, such as those related to the hand lingand storage of un wanted fish onboard.
3. Gomberg, A., Marhuenda, F., y Ortuño-Ortín, I., "Endogenous Party Platforms: "Stochastic" Membership". Economic Theory, October 2016, Volume 62, Issue 4, pp 839–866
Abstract:
We propose a model of endogenous party platforms with stochastic membership. The parties' proposals depend on their membership, while the membership depends both on the proposals of the parties and the unobserved idiosyncratic preferences of citizens over parties. An equilibrium of the model obtains when the members of each party prefer the proposal of the party to which they belong to, rather than the proposal of the other party.
We prove the existence of such an equilibrium and study its qualitative properties. For the cases in which parties use either the average or the median to aggregate the preferences of their members, we show that if the unobserved idiosyncratic characteristics of the parties are similar, then parties make different proposals in the stable equilibria. Conversely, we argue that if parties differ substantially in their unobserved idiosyncratic characteristics, then the unique equilibrium is convergent.
4. Gutiérrez, E. and Teshima, K. “Does household financial access facilitate law compliance? Evidence from Mexico”. Economics Letters. 149 (December 2016), pages 120–124
Abstract:
We investigate the impact of financial access on law compliance (whether workers are registered in a mandated social security system). In contrast to previous studies that focus on firms’ access to credit, we investigate workers’ access to credit. Exploiting the geographic variation in financial access due to Banco Azteca’s opening in Mexico in 2002 that changed financial access by poor people almost over-night, we find that financial access increased the probability of getting formalized.
5. Santacreu-Vasut, E,. and Teshima, K. “Foreign employees as channel for technology transfer: Evidence from MNC's subsidiaries in Mexico”. Journal of Development Economics. 122, (September 2016), pages 92–112.
Abstract:
This paper studies the role of foreign employees as a channel for technology transfer in multinational companies (MNCs). We build a simple model of MNC choice between foreign and domestic management as a function of industry characteristics and of institutional quality. We find that foreign employees are a channel for technology transfer within high-tech MNCs. Further, the reliance of MNCs on foreign employees is U-shaped in terms of institutional quality. Our model implies that we should observe the same pattern between technology transfer and institutional quality. We use a unique dataset that links information on technology transfer and the presence of foreign employees in subsidiaries in Mexico with data on judicial efficiency across Mexican states. The evidence is consistent with the implications of the model and difficult to reconcile with alternative hypotheses.
6. Turhan, B., Manjunath, V., "Two School Systems, One District: What To Do When a Unified Admissions Process is Impossible." Games and Economic Behavior 96 ( January, 2016), pp. 25-40.
Abstract:
When groups of schools within a single district run their admission processes independently of one another, the resulting match is often inefficient: many children are left unmatched and seats are left unfilled. We study the problem of re-matching students to take advantage of these empty seats in a context where there are priorities to respect. We propose an iterative way in which each group may independently match and re-match students to its schools.The advantages of this process are that every iteration leads to a Pareto improvement and a reduction in waste while maintaining respect of the priorities. Furthermore, it reaches a non-wasteful match within a finite number of iterations.While iterating may be costly, as it involves asking for inputs from the children, there are significant gains from the first few iterations. We show this analytically for certain stylized problems and computationally for a few others.
7. Ülkü, L., Aguilera, J. “On the maximization of menu-dependent interval orders” . Social Choice and Welfare (15 November, 2016), Pp 1–10
Abstract:
We study the behavior of a decision maker who prefers alternative x to alternative y in menu Aif the utility of x exceeds that of y by at least a threshold associated with yandA. Hence the decision maker’s preferences are given by menu-dependent interval orders. In every menu, her choice set comprises of undominated alternatives according to this preference. We axiomatize this broad model when thresholds are monotone, i.e., at least as large in larger menus. We also obtain novel characterizations in two special cases that have appeared in the literature: the maximization of a fixed interval order where the thresholds depend on the alternative and not on the menu, and the maximization of monotone semiorders where the thresholds are independent of the alternatives but monotonic in menus.
8. Alonso, J., and Leal, J., "Cross-subsidies, and the elasticity of informality to social expenditures: the case of Mexico's Seguro Popular ", Review of Income and Wealth, Forthcoming. December, 2016.
Abstract:
How is the size of the informal sector affected when the distribution of social expenditures across formal and informal workers changes? How is it affected when the tax rate and the generosity of these transfers changes? We use a search frictions model with an informal sector, (ex-post) heterogeneous workers, and conditional taxes and transfers to address these questions. In our model, formal jobs are “better” than informal jobs, but harder to get. Taxes are proportional to the wage, while transfers are lump sum, implying a cross-subsidy from high-income to low-income workers. We calibrate the model to Mexico and perform counterfactuals. We find that the size of the informal sector is quite inelastic to changes in taxes and transfers. This is due to frictions, and due to the fact that the marginal worker weighs two opposing forces: changes in taxes (negative) vs. changes in transfers (positive). These two forces act simultaneously leaving reservation wages roughly unchanged. Our results are consistent with the empirical evidence on the recent introduction of Seguro Popular.
9. Da-Rocha, J., García Cutrín, J., Gutiérrez, M., Touza, J., “Reconciling yield stability with international fisheries agencies precautionary preferences: The role of non constant discount factors in age structured models”, Fisheries Research, January, 2016.
Abstract:
International fisheries agencies recommend exploitation paths that satisfy two features. First, for precautionary reasons exploitation paths should avoid high fishing mortality in those fisheries where the biomass is depleted to a degree that jeopardise the stock’s capacity to produce the Maximum Sustainable Yield (MSY). Second, for economic and social reasons, captures should be as stable (smooth) as possible over time. In this article we show that a conflict between these two interests may occur when seeking for optimal exploitation paths using age structured bioeconomic approach. Our results show that this conflict be overtaken by using non constant discount factors that value future stocks considering their relative intertemporal scarcity.
10. Da-Rocha, J., García Cutrín, J., Gutiérrez, M., “To shape or to be shaped: engaging stakeholders in the fisheries management advice”, ICES Journal of Marine Science, Forthcoming.
Abstract:
The purpose of this paper is to assess the effectiveness of the collaboration between stakeholders and scientists in the construction of a bio-economic model to simulate management strategies for the fisheries in Iberian Atlantic waters. For three years, different stakeholders were involved in a model development study, participating in meetings, surveys and workshops. Participatory modelling involved the definition of objectives and priorities of stakeholders, a qualitative evaluation and validation of the model for use by decision-makers, and an iterative process with the fishing sector to interpret results and introduce new scenarios for numerical simulation. The results showed that the objectives of the participating stakeholders differed. Incorporating objectives into the design of the model and prioritising them was a challenging task. We showed that the parameterization of the model and the analysis of the scenarios results could be improved by the fishers’ input: e.g. ray and skate stocks were explicitly included in the model; and the behaviour of fleet dynamics proved much more complex than assumed in any traditional modelling approach. Overall, this study demonstrated that stakeholder engagement through dialogue and many interactions was beneficial for both, scientists and the fishing industry. The researchers obtained a final refined model and the fishing industry benefited for participating in a process, which enables them to influence decisions that may affect them directly (to shape) whereas non-participatory processes lead to management strategies being imposed on stakeholders (to be shaped).
11. Da-Rocha, J., Mato-Amboage, R., “On the Benefits of Including Age-Structure in Harvest Control Rules”, Environmental and Resource Economics, July 2016.
Abstract:
This paper explores the benefits of including age structure in the control rule (HCR) when decision makers regard their (age-structured) models as approximations. We find that introducing age structure into the HCR reduces both the volatility of the spawning biomass and the yield. Although the benefits are lower at a fairly imprecise level, there are still major advantages for the actual precision with which the case study is assessed. Moreover, we find that when age-structure is included in the HCR the relative ranking of different policies in terms of variance in biomass and yield does not differ. These results are shown both theoretically and numerically by applying the model to the Southern Hake fishery.
12. Pancs, R., "Tight and Loose Coupling in Organizations", The B.E. Journal of Theoretical Economics. Published by De Gruyteron June 29, 2016.
Abstract:
Some industries have consumers who seek novelty and firms that innovate vigorously and whose organizational structure is loosely coupled, or easily adaptable. Other industries have consumers who take comfort in the traditional and firms that innovate little and whose organizational structure is tightly coupled, or not easily adaptable. This paper proposes a model that explains why the described features tend to covary across industries. The model highlights the pervasiveness of equilibrium inefficiency (innovation can be insufficient or excessive) and the nonmonotonicity of welfare in the equilibrium amount of innovation.
13. Simpser, A., Duquette-Rury, L., Hernández Company, J. y Ibarra, J., “The Political Economy of Social Spending by Local Government: A Study of the 3x1 Program for Migrants in Mexico”, Latin American Research Review. Vol. 51, No. 1 (2016), pp, 62-83 (22 pages).
Abstract:
Social spending by central governments in Latin America has, in recent decades, become increasingly insulated from political manipulation. Focusing on the 3x1 Program in Mexico in 2002-2007, we show that social spending by local government is, in contrast, highly politicized. The 3x1 Program funds municipal public works, with each level of government –municipal, state, and central –matching collective remittances. Our analysis shows that 3x1 municipal spending is shaped by political criteria. First, municipalities time disbursements according to the electoral cycle. Second, when matching collective remittances, municipalities protect personnel salaries, instead adjusting budget items that are less visible to the public such as debt. Third, municipalities spend more on 3x1 projects when their partisanship matches that of the state government. Beyond the 3x1 Program, our findings highlight the considerable influence that increasing political and economic decentralization can have on local government incentives and spending choices, in Mexico and beyond.
14. Da Rocha, J.M.,S. Villasante, C. Pazos Guimerans, J. Rodrigues, M. Antelo, S. Rivero Rodrıguez, M. Coll, C. Pita, G. J. Pierce, L. Hastie, J. Garcıa-Cutrın, P. Veiga and R. Sumaila, “ Fishers' perceptions about the EU discards policy and its economic impact on small-scale fisheries in Galicia (North West Spain)”, Ecological Economics Volume 130, October 2016, Pages 130-138
Abstract:
This paper investigates the impact of the European Union landing obligation in the Galician (North West of Spain) multispecies small-scale gillnet fishery. By combining results from semi-structured interviews with small-scale fishers and a bioeconomic model, we found that the percentage of discards for small-scale fisheries is usually low, which is consistent with general empirical observations globally but can be high when quotas are exhausted. Our results also confirm that the landing obligation would generate negative impacts on fishers' activities by investing more time on-board to handle previously discarded fishes, and putting at risk the security of fishers at sea due to full use of allowable storage on-board coupled with often adverse sea conditions in Galician bays. The application of the landing obligation policy to small-scale fisheries would result in short- and long-term losses of fishing days and yields, with high negative impacts on sustainable fisheries such as the Galician multispecies small-scale gillnet fishery. The expected number of fishing days under the landing obligation is estimated to be reduced by 50% during the five years following the implementation of the policy. The future yield (catches) under the landing obligation would be only 50% of catches expected in the absence of the landing obligation, regardless of the total volume of quotas allocated to the fleet.