2010


856. Globalization and Imperfect Labor Market Sorting

Carl Davidson, Fredrik Heyman, Steven Matusz, Fredrik Sjöholm and Susan Chun Zhu

This paper focuses on the ability of the labor market to correctly match heterogeneous workers to jobs within a given industry and the role that globalization plays in that process. Using matched worker-firm data from Sweden, we find strong evidence that…


855. The Right Look: Conservative Politicians Look Better and Voters Reward It

Niclas Berggren, Henrik Jordahl and Panu Poutvaara

Political candidates on the right are more beautiful or are seen as more competent than candidates on the left in Australia, Finland, France, and the United States. This appearance gap gives candidates on the right an advantage in elections, which could…


854. Piracy, Music and Movies: A Natural Experiment

Adrian Adermon and Che-Yuan Liang

This paper investigates the effects of illegal file sharing (piracy) on music and movie sales. The Swedish implementation of the European Union directive IPRED on April 1, 2009 suddenly increased the risk of being caught and prosecuted for file sharing.…


853. Institutional Entrepreneurship: An Introduction

Magnus Henrekson and Tino Sanandaji

In this introductory chapter to a collective volume, we build on Baumol’s (1990) framework to categorize, catalogue, and classify the budding research field that explores the interplay between institutions and entrepreneurship. Institutions channel…


852. FDI and Growth in East Asia: Lessons for Indonesia

Robert E. Lipsey and Fredrik Sjöholm

Foreign direct investment has been important in the economic growth and global economic integration of developing countries over the last decades. Both Northeast and Southeast Asia, especially the latter, have been part of this development with increasing…


851. The Real Effects of Private Equity Buyouts

Joacim Tåg

Private equity buyouts have become a common element in the industrial development process. I survey the literature on the real economic effect of buyouts: employment, wages, productivity, and long-run investments. Employment tends to marginally fall after…


850. The World Distribution of Productivity: Country TFP Choice in a Nelson-Phelps Economy

Erika Färnstrand Damsgaard and Per Krusell

This paper builds a theory of the shape of the distribution of total-factor productivity (TFP) across countries. The data on productivity suggests vast differences across countries, and arguably even has “twin peaks”. The theory proposed here is…


849. Exploring the Duration of EU Imports

Wolfgang Hess and Maria Persson

The objective of this paper is twofold. First, against the background of existing empirical literature on the duration of trade which has found that international trade is often of strikingly short duration, we aim to establish whether or not EU imports…


848. Completing the EU Customs Union. The Effects of Trade Procedure Harmonization

Yves Bourdet and Maria Persson

A main component of custom unions is a common trade policy on imports from non-member countries. Trade policy covers both tariff and non-tariff barriers like trade procedures. We argue that since trade procedures vary markedly across EU countries, the EU…


847. The CFO’s Information Challenge in Managing Macroeconomic Risk

Lars Oxelheim, Clas Wihlborg and Marcus Thorsheim

In this chapter we examine the role of the CFO in setting risk management strategy with respect to macroeconomic risk in particular, and we consider the information requirements for setting a strategy that is consistent with corporate objectives. We argue…


846. Is Tolerance Good or Bad for Growth?

Niclas Berggren and Mikael Elinder

We investigate to what extent tolerance, as measured by attitudes toward different types of neighbors, affects economic growth. Data from the World Values Survey enables us to investigate tolerance–growth relationships for 54 countries. We provide…


845. Using Self-employment as Proxy for Entrepreneurship: Some Empirical Caveats

Carl Magnus Bjuggren, Dan Johansson and Mikael Stenkula

Research on entrepreneurship has received an increased amount of interest in recent years, with self-employment being used as the most common proxy for “entrepreneurship” in empirical studies. However, there are various ways of defining…


844. Exhaustible Resources, Technology Choice and Industrialization of Developing Countries

Erika Färnstrand Damsgaard

How should the world economy adapt to the increased demand for exhaustible resources from countries like China and India? To address that issue, this paper presents a dynamic model of the world economy with two technologies for production; a resource…


843. Exposure-Based Cash-Flow-at-Risk for Value-Creating Risk Management under Macroeconomic Uncertainty

Niclas Andrén, Håkan Jankensgård and Lars Oxelheim

A strategically minded CFO will realize that strategic corporate risk management is about finding the right balance between risk prevention and proactive value generation. Efficient risk and performance management requires adequate assessment of risk and…


842. How to Avoid Compensating CEO for Luck: The Case of Macroeconomic Fluctuations

Lars Oxelheim, Clas Wihlborg and Jianhua Zhang

Incentive effects of performance-based compensation schemes for management may be weakened or biased by macroeconomic influences on remuneration. These influences can be seen as reflecting luck from the CEO’s perspective. In this chapter we present…


841. Does the Debt Tax Shield Distort Ownership Efficiency?

Pehr-Johan Norbäck, Lars Persson and Joacim Tåg

The tax laws of most developed countries are debt biased since firms can deduct interest on debt but not on equity. This bias is known to distort investment decisions. However, less is known about how the debt tax shield affects the ownership of assets…


840. A Continuous Theory of Income Insurance

Assar Lindbeck and Mats Persson

In this paper we treat an individual’s health as a continuous variable, in contrast to the traditional literature on income insurance, where it is regularly treated as a binary variable. This is not a minor technical matter; in fact, a continuous…


839. Graded Children – Evidence of Longrun Consequences of School Grades from a Nationwide Reform

Anna Sjögren

Swedish elementary school children stopped receiving written end of year report cards following a grading reform in 1982. Gradual implementation of the reform creates an opportunity to investigate the effects of being graded on adult educational…


838. Optimal Transmission Regulation in an Integrated Energy Market

Thomas P. Tangerås

The capacity of the transmission network determines the extent of integration of a multinational energy market. Cross-border externalities render coordination of network maintenance and investments across countries valuable. Is it then optimal to collect…


837. Fiscal Illusion and Fiscal Obfuscation: An Empirical Study of Tax Perception in Sweden

Tino Sanandaji and Björn Wallace

In this paper we present survey evidence suggesting that there exists a sizeable fiscal illusion amongst the general public in Sweden. Respondents in a nation-wide and representative survey systematically underestimate the share of an ordinary worker’s…


836. North Korea: Fading Totalitarianism in the "Hermit Kingdom"

Benjamin Katzeff Silberstein

North Korea is perceived by many as one of the most totalitarian societies of modern time. But in the wake of the economic collapse of the 1990s, North Korean totalitarianism has grappled with new conditions. This paper examines how the country’s…


835. Height and Leadership

Erik Lindqvist

This paper studies the relationship between height and leadership. Using data from a representative sample of Swedish men, I document that tall men are significantly more likely to attain managerial positions. An increase in height by 10 centimeters (3.94…


834. Planned Treatment and Outcomes in Residential Youth Care: Evidence from Sweden

Erik Lindqvist

A recurring theme in evaluations of Swedish residential youth care is that treatment is often unplanned. In this paper, I show that planned treatment is strongly positively associated with treatment outcomes. In the short term, teenagers with planned…


833. The Effect of Tax Treaties on Multinational Firms: New Evidence from Microdata

Ronald B. Davies, Pehr-Johan Norbäck and Ayça Tekin-Koru

This paper uses affiliate level data from Swedish multinationals to examine the impact of tax treaties on both overall affiliate sales and the composition of those sales. In line with previous results, we find little evidence for an effect of treaties on…


832. Subsidizing Away Exports? A Note on R&D-policy towards Multinational Firms

Pehr-Johan Norbäck

In this paper, I investigate whether instead of strengthening home-based production, government R&D-subsidies can induce R&D-intensive firms to locate production abroad. Investigating firm-level data on Swedish MNEs, however, I find no evidence of…


831. Foreign Ownership and Employment Growth in Indonesian Manufacturing

Robert E. Lipsey, Fredrik Sjöholm and Jing Sun

Many developing countries would like to increase the share of modern or formal sectors in their employment. One way to accomplish this goal may be to encourage the entrance of foreign firms. They are typically relatively large, with high productivity and…


830. The Interaction of Entrepreneurship and Institutions

Magnus Henrekson and Tino Sanandaji

Previous research, notably Baumol (1990), has highlighted the role of insti-tutions in channeling entrepreneurial supply into productive, unproductive or destructive activities. However, entrepreneurship is not only influenced by…


829. The Duration of Trade Revisited: Continuous-Time vs. Discrete-Time Hazards

Wolfgang Hess and Maria Persson

The recent literature on the duration of trade has predominantly analyzed the determinants of trade flow durations using Cox proportional hazards models. The purpose of this paper is to show why it is inappropriate to analyze the duration of trade with…


828. Trade Facilitation and the Extensive Margin

Maria Persson

The literature on trade facilitation has mostly focused on implications for trade volumes. However, recent theoretical contributions have emphasized that trade costs – such as transaction costs related to cross-border trade procedures – affect…


827. Gender, Wages, and Social Security in China’s Industrial Sector

Johanna Rickne

This study compares average earnings and productivities for men and women employed in roughly 200,000 Chinese industrial enterprises. Women’s average wages lag behind men’s wages by 11%, and this result is robust to the inclusion of non-wage…


826. Taxation, Labor Market Policy and High-Impact Entrepreneurship

Magnus Henrekson, Dan Johansson and Mikael Stenkula

Public policy affects the prevalence and performance of both productive and high-impact entrepreneurship. High-impact entrepreneurship prospers when knowledge is successfully generated and exploited in the economy. This process depends on complementary…


825. Hybrid Entrepreneurship

Timothy B. Folta, Frédéric Delmar and Karl Wennberg

In contrast to previous efforts to model the individual’s movement from wage work into entrepreneurship, we consider that individuals might transition incrementally by retaining their wage job while entering into self-employment. We show that these hybrid…


824. Housing Policies in China: Issues and Options

Yves Zenou

This article consists of three parts. The first part deals with theory. We evaluate the pros and cons of government involvement in urban housing and of renting versus ownership. In the second part, we summarize the different housing policies that…


823. Globalization of Corporate Governance: The American Influence on Dismissal Performance Sensitivity of European CEOs

Jochen A. Jungeilges, Lars Oxelheim and Trond Randoy

This study examines how globalization of corporate governance practices influences the risk of European CEOs being dismissed. We argue that the harsh monitoring of the American corporate governance system spills over to the rest of the world as a result…


822. Public and Private Welfare State Institutions: A Formal Theory of American Exceptionalism

Kaj Thomsson

I construct a model of public policy development, and use the model to explain why the United States has a comparatively small public sector, but instead a large "private welfare state" with employment-based benefits. The key factors are politically…


821. Local Economies and General Elections: The Influence of Municipal and Regional Economic Conditions on Voting in Sweden 1985–2002

Mikael Elinder

This paper presents a detailed analysis of voters’ responses to municipality and regional-level unemployment and economic growth, using panel data on 284 municipalities and 9 regions and covering Swedish general elections from 1982 to 2002. The…


820. Firm Growth, Institutions and Structural Transformation

Magnus Henrekson and Dan Johansson

This essay argues that the economic contribution of certain firms – be they small, young or rapidly growing – has to be understood in a broader context of creative destruction. Growth of some firms requires contraction and exit of some other firms to free…


819. Citation Success: Evidence from Economic History Journal Publications

Gianfranco Di Vaio, Daniel Waldenström and Jacob Weisdorf

This study examines the determinants of citation success among authors who recently published their work in economic history journals. We find that full professors, authors from non-economic history departments, and authors working in Anglo-Saxon…


818. The Futile Quest for a Grand Explanation of Long-Run Government Expenditure

Dick Durevall and Magnus Henrekson

This paper carries out a critical reappraisal of the two contending theories purporting to explain long-run government spending: Wagner’s Law and different variants of the ratchet effect. We analyze data spanning from the early 19th century until the…


817. Buying to Sell: A Theory of Buyouts

Pehr-Johan Norbäck, Lars Persson and Joacim Tåg

Private equity firms are an important part of the industrial restructuring process. We argue that the key is temporary ownership. Buying to sell induces aggressive restructuring since the equilibrium trade sale price increases both because the profits of…

An Agenda for Europe

Institutional Reform for Innovation and Entrepreneurship

Omslag 2017 Institutional Reform for Innovation and Entrepreneurship.jpg

The authors of this book, Niklas Elert, Magnus Henrekson and Mikael Stenkula, advise the economies of the European Union to become more entrepreneurial in promoting innovation and economic growth. The authors propose a reform strategy with respect to several aspects to achieve this goal.

Events

Seminars organized by IFN

 

To present ongoing research informal brown-bag seminars are held on Mondays at 11:30 am. This is an opportunity for IFN researchers to test ideas and results.

Academically oriented seminars are most of the time held on Wednesdays at 10 am. At these events researchers from IFN and other institutions present their research.

In addition, IFN organizes seminars open to the public. Topics for these are derived from the IFN research.

Research Institute of Industrial Economics, Grevgatan 34 - 2 fl, Box 55665, SE-102 15 Stockholm, Sweden | Phone: +46-(0)8-665 45 00 | info@ifn.se