1. M. Dell, B. Feigenberg and K. Teshima, "The Violent Consequences of Trade-Induced Worker Displacement in Mexico", for American Economic Associatiom. Vol. 1, No. 1, June 2019. (pp 43-58).
Abstract:
Mexican manufacturing job loss induced by competition with China increases cocaine trafficking and violence, particularly in municipalities with transnational criminal organizations. When it becomes more lucrative to traffic drugs because changes in local labor markets lower the opportunity cost of criminal employment, criminal organizations plausibly fight to gain control. The evidence supports a Becker-style model in which the elasticity between legitimate and criminal employment is particularly high where criminal organizations lower illicit job search costs, where the drug trade implies higher pecuniary returns to violent crime, and where unemployment disproportionately affects low-skilled men.
4. S. Garrido and E. Gutiérrez, "Time goes by so slowly (for those who wait): a field experiment in health care", in Latin American Economic Review. 19 February 2019.
Abstract:
We exploit a unique field experiment to recover the willingness to pay (WTP) for shorter waiting times at a cataract detection clinic in Mexico City, and compare the results with those obtained through a hypothetical dichotomous choice questionnaire. The WTP to avoid a minute of wait obtained from the field experiment ranges from 0.59 to 0.82 Mexican pesos (1 USD =12.5 Mexican pesos at the time of the survey), while that from the hypothetical choice experiment ranges from 0.33 to 0.48 Mexi-can pesos. WTP to avoid the wait is lower for lower income individuals, and it is larger the more accurately the announced expected waiting time matches the true values. Finally, we find evidence that the marginal disutility of waiting is not constant.
5. F. Meza. S. Pratap and C. Urrutia, "Credit, Misallocation and Productivity Growth: A Disaggregated Analysis", Review of Economic Dynamics, Vol. 34, pages 61-86, 2019.
Abstract:
Abstract: We study the effect of credit conditions on the allocation of inputs, and their implications for aggregate TFP growth. For this, we build a new dataset for Mexican manufacturing merging real and financial data at the 4-digit industrial sector level. Using a simple misallocation framework, we find that changes in inter-industry allocative efficiency account for 41 percent of changes in aggregate TFP. We then construct a model of firm behavior with working capital constraints and borrowing limits which generate sub-optimal use of inputs, and calibrate it to our data. We find that the model accounts for 38 percent of the observed variability in efficiency. An important conclusion is that heterogeneity in credit conditions across industries is key in accounting for efficiency gains. Despite overall credit stagnation, more access to credit and lower interest rates to distorted industries contributed substantially to the recovery from the 2009 recession, suggesting a plausible mechanism for credit-less recoveries.
6. D. Domínguez and I. Morgenstern, "A characterization of the random arrival rule for bankruptcy problems", Economics Letters Volume 174,Pages 214-217, 2019.
Abstract:
It is known that no additive division rules exist for bankruptcy problems. In this paper, we study a restricted additivity property which we call “feasible set additivity” (FSA). This property requires division rules to be additive when the set of feasible allocation vectors for a sum of problems does not include allocations that were unfeasible when considering each problem separately.
In addition, we characterize the random arrival rule as the only division rule satisfying FSA and equal treatment of equals for two and three-agent cases. We also show that this characterization holds when the endowment is small enough in relation to the claims, while the question of whether it holds in general remains open.
7. A. Gomberg, E. Gutiérrez, P. López, and A. Vázquez. "Coattails and the forces that drive them: Evidence from Mexico." European Journal of Political Economy 58 64-81, 2019.
Abstract:
Coattails and the forces behind them have important implications for the understanding of electoral processes and their outcomes. By focusing our attention on neighboring electoral sections that face the same local congressional election, but different municipal elections, and assuming that political preferences for local legislative candidates remain constant across neighboring electoral sections, we exploit variation in the strength of the municipal candidates in each of these electoral sections to estimate coattails from municipal to local congressional elections in Mexico. A one percentage increase in vote share for a municipal candidate translates, depending on his or her party, into an average of between 0.45 and 0.78 percentage point increase in vote share for the legislative candidates from the same party (though this effect may not have been sufficient to affect an outcome in any electoral district in our sample). In addition, we find that a large fraction of the effect is driven by individuals switching their vote decision in the legislative election, rather than by an increase in turnout.
8. I. Mbiti, K. Muralidharan, M. Romero, Y. Schipper, C. Manda, and R. Rajani. "Inputs, Incentives, and Complementarities in Education: Experimental Evidence from Tanzania", The Quarterly Journal of Economics, qjz010, 2019.
Abstract:
We present results from a large-scale randomized experiment across 350 schools in Tanzania that studied the impact of providing schools with (i) unconditional grants, (ii) teacher incentives based on student performance, and (iii) both of the above. After two years, we find (i) no impact on student test scores from providing school grants, (ii) some evidence of positive effects from teacher incentives, and (iii) significant positive effects from providing both programs. Most important, we find strong evidence of complementarities between the programs, with the effect of joint provision being significantly greater than the sum of the individual effects. Our results suggest that combining spending on school inputs (the default policy) with improved teacher incentives could substantially increase the cost-effectiveness of public spending on education.
9. E. Colla, J.M. Da Rocha, J. García-Cutrín, M.J. Gutiérrez and R. Prellezo, "A bayesian estimation of the economic effects of the Common Fisheries Policy on the Galician Fleet: a dynamic stochastic general equilibrium approach" , Ocean and Coastal Management, , Volume 167, 1 January 2019, Pages 137-144
Abstract:
What would have happened if a relatively looser fisheries policy had been implemented in the European Union (EU)? Using Bayesian methods a Dynamic Stochastic General Equilibrium (DSGE) model is estimated to assess the impact of the European Common Fisheries Policy (CFP) on the economic performance of a Galician (north-west of Spain) fleet highly dependant on the EU southern stock of hake. Our counterfactual analysis shows that if a less effective CFP had been implemented during the period 1986-2012, "fishing opportunities” would have increased, leading to an increase in labor hours of 4.87%. However, this increase in fishing activity would have worsened the profitability of the fleet, dropping wages and rental price of capital by 6.79% and 0.88%, respectively. Welfare would also be negatively affected since, in addition to the increase in hours worked, consumption would have reduced by 0.59%.
10. P. Evdokimov and U. Garfagnini, "Communication and Behavior in Organizations: An Experiment", Quantitative Economics. 8 May 2019.
Abstract:
We design a laboratory experiment to study behavior in a multidivisional organization facing a trade-off between coordinating its decisions across the divisions and meeting division-specific needs that are known only to the division managers. The managers communicate their private information through cheap talk. While the results show close to optimal communication, we also find systematic deviations from optimal behavior in how the communicated information is used. Specifically, subjects' decisions show worse than predicted adaptation to the needs of the divisions in decentralized organizations and worse than predicted coordination in centralized organizations. We show that the observed deviations disappear when uncertainty about the divisions' local needs is removed and discuss the possible underlying mechanisms.
11. J.M. Da Rocha M. Mendes Tavares and D. Restuccia "Firing Costs, Misallocation, and Aggregate Productivity" Journal of Economic Dynamics and Control, Volume 98, January 2019, Pages 60-81.
Abstract:
We study the impact of firing costs on aggregate total factor productivity (TFP) in a dynamic general-equilibrium framework where the evolution of establishment-level productivity is not invariant to the policy. Firing costs not only generate static factor misallocation, but also distort the selection of establishment’s growth by size, contributing to larger aggregate TFP losses. Numerical experiments indicate that firing costs equivalent to 5 year’s wages imply a reduction in TFP of more than 20 percent. Factor misallocation accounts for 20 percent of the productivity loss, whereas the remaining 80 percent arises from distorted selection in the productivity process.
12. Ignacio N. Lobato and Manuel Domínguez "Specification Testing with Estimated Variables" Econometric Reviews, 2020, 39, 476-494. 8 November 2019.
Abstract:
This article proposes specification tests for economic models defined through conditional moments restrictions in which conditioning variables are estimated. There are two main motivations for this situation. First, the case when the conditioning variables are not directly observable, such as economic models, where innovations or latent variables appear as explanatory variables. Second, the case when the set of conditioning variables is too large to derive powerful tests, and hence, the original conditioning set is replaced by a constructed variable that is regarded as a good summary of it. We establish the asymptotic properties of the proposed tests, examine its finite sample behavior, and apply them to different econometric contexts. In some cases, the proposed approach leads to relevant tests that generalize well known specification tests, such as Ramsey’s RESET test.
13. Lucas W. Davis, Shaun McRae and Enrique Seira Bejarano "An Economic Perspective on Mexico’s Nascent Deregulation of Retail Petroleum Markets", Journal Economics of Energy & Environmental Policy (EEEP), Vol.8: No.2. 2019.
Abstract:
Retail petroleum markets in Mexico are on the cusp of a historic deregulation. For decades, all 11,000 gasoline stations nationwide have carried the brand of the state-owned petroleum company Pemex and sold Pemex gasoline at federally regulated retail prices. This industry structure is changing, however, as part of Mexico’s broader energy reforms aimed at increasing private investment. Since April 2016, independent companies can import, transport, store, distribute, and sell gasoline and diesel. In this paper, we provide an economic perspective on Mexico’s nascent deregulation. Although in many ways the reforms are unprecedented, we argue that past experiences in other markets give important clues about what to expect, as well as about potential pitfalls. Turning Mexico’s retail petroleum sector into a competitive market will not be easy, but the deregulation has the potential to increase efficiency and, eventually, to reduce prices.
14. Arturo Aguilar, Pablo Gaitán-Rossi , Selene De la Cerda, Alma C. Pérez, Manett Vargas, and Mireya Vilar-Compte, "Fidelity of Implementation of Prospera Digital: Evaluation of a Multi-Site mHealth Intervention Aimed at Improving Maternal Health Outcomes in Mexico", Current Developments in Nutrition 3 (10): nzz107. October 2019.
Abstract:
Infrastructure and human capital limitations motivate the design of mHealth programs, but their large-scale implementation may be challenging in a development context. Prospera Digital (PD) is a pilot mHealth intervention aiming to improve maternal and child health and nutrition designed as a randomized controlled trial with 3 treatment arms. It was implemented during 2015–2017 in 326 treatment clinics located in 5 states in Mexico.