2005


656. Human Capital, Rent Seeking, and a Transition from Stagnation to Growth

Nils-Petter Lagerlöf and Thomas Tangerås

We present a growth model where agents divide time between rent seeking in the form of resource competition; and working in a human capital sector, interpreted as trade or manufacturing. Rent seeking exerts negative externalities on the productivity of…


655. Do Entrenched Managers Pay Their Workers More?

Henrik Cronqvist, Fredrik Heyman, Mattias Nilsson, Helena Svaleryd and Jonas Vlachos

Analyzing a large panel that matches public firms with worker-level data, we find that managerial entrenchment affects workers’ pay. CEOs with more control pay their workers more, but financial incentives through ownership of more cash flow rights…


654. The Effect of Offshoring on Labor Demand: Evidence from Sweden

Karolina Ekholm and Katariina Hakkala

We analyze the effects of offshoring of intermediate input production on labor demand in Sweden, distinguishing between workers with different educational attainments. The econometric results using data for the 1995-2000 period indicate that offshoring –…


653. Promoting Entrepreneurship in the Welfare State

Magnus Henrekson and Jesper Roine

Entrepreneurship is largely ignored or treated in a highly simplified way in endogenous growth theory. Still, it is now widely recognized that the supply of entrepreneurial talent is likely to be important for economic growth, innovation and job creation.…


652. The Todaro Paradox Revisited

Yves Zenou

The Todaro Paradox states that policies aimed at reducing urban unemployment are bound to backfire: they will raise rather than reduce urban unemployment. The aim of this paper is to reexamine this paradox in the context of efficiency wage and…


651. Crime, Location and the Housing Market

Yves Zenou

We highlight the role of commuting cost, location and housing market in crime decision. By assuming that all crimes are committed in the central business district and that criminals create both positive and negative externalities to each other, we find…


650. Foreign Operations of Swedish Manufacturing Firms Evidence from the IUI Survey on Multinationals 2003

Katariina Hakkala and David Zimmermann

The paper serves as a documentation of the survey IUI has conducted on Swedish multinational firms (MNEs) in 2004. It describes recent trends in the operations of Swedish multinational firms participating in the survey and foreign direct investment (FDI)…


649. Oppositional Identities and the Labor Market

Harminder Battu, McDonald Mwale and Yves Zenou

We develop a model in which non-white individuals are defined with respect to their social environment (family, friends, neighbors) and their attachments to their culture of origin (religion, language), and in which jobs are mainly found through social…


648. Property Tax and Urban Sprawl: Theory and Implications for U.S. Cities

Yan Song and Yves Zenou

This article attempts a formal analysis of the connection between property tax and urban sprawl in U.S. cities. We develop a theoretical model that includes households (who are also landlords) and land developers in a regional land market. We then test…


647. Domestic versus Cross-Border Acquisitions: Which Impact on the Target Firms' Performance?

Olivier Bertrand and Habib Zitouna

This paper investigates the effects of horizontal acquisitions on the performance of target firms in the 1990's. Using French manufacturing firm-level data, we examine two main indicators of performance: the profit and the productive efficieny. We…


646. Sustainable Social Spending

Assar Lindbeck

The paper discusses a number of threats to the financial sustainability of social spending: increased internationalization of national economies, gradually higher relative costs of producing a number of human services, the “graying” of the population,…


645. Peer Effects and Social Networks in Education and Crime

Antoni Calvó-Armengol, Eleonora Patacchini and Yves Zenou

This paper studies whether structural properties of friendship networks affect individual outcomes in education and crime. We first develop a model that shows that, at the Nash equilibrium, the outcome of each individual embedded in a network is…


644. Investment Liberalization – Why a Restrictive Cross-Border Merger Policy can be Counterproductive

Pehr-Johan Norbäck and Lars Persson

Investment liberalizing countries are often concerned that cross-border mergers & acquisitions, in contrast to greenfield investments, might have an adverse effect on domestic firms and consumers. However, given that domestic assets are sufficiently…


643. Are Objective, Official Measures of Disability Reliable?

Per Johansson and Per Skedinger

The issue considered in this study is whether objective, official reports on disability status are reliable. While there is a rather large literature on the reliability of self-reported disability, evidence regarding objective data is scant. It seems to…


642. Peers and Culture

María Sáez-Martí and Anna Sjögren

We analyze the evolution of cultural traits when parents purposefully invest resources in order to socialize their children to the cultural traits that maximize child lifetime utility. We assume that children are not passive in their adoption of traits…


641. Asymmetric Effects of Corruption on FDI: Evidence from Swedish Multinational Firms

Katariina Hakkala, Pehr-Johan Norbäck och Helena Svaleryd

We examine the effect of corruption on foreign direct investments (FDI). Starting out from the theory of FDI, we show that corruption can have different effects on horizontal investments, which are primarily aimed at sales to the local market, compared to…


640. Factor Supplies and the Direction of Technical Change

Helena Svaleryd and Jonas Vlachos

In this paper, we empirically address the hypothesis that there is a relationship between the supply of human capital and the rate and direction of skill-biased technical change (SBTC). Using country- and industry-level data on OECD countries, we find…


639. Vertical Distribution, Parallel Trade, and Price Divergence in Integrated Markets

Mattias Ganslandt and Keith E. Maskus

We develop a model of vertical pricing in which an original manufacturer sets wholesale prices in two markets that are integrated at the distributor level by parallel imports (PI). The manufacturing firm needs to set these two prices to balance three…


638. Reciprocal Dumping with Bertrand Competition

Richard Friberg and Mattias Ganslandt

This paper examines if international trade can reduce total welfare in an international oligopoly with differentiated goods. We show that welfare is a U-shaped function in the transport cost as long as trade occurs in equilibrium. With a Cournot duopoly…


637. On the Link between Exchange-Rate Regimes and Monetary-Policy Autonomy: The European Experience

Jens Forssbæck and Lars Oxelheim

We investigate monetary-policy autonomy under different exchange-rate regimes in small, open European economies during the 1980s and 1990s. We find no systematic link between ex post monetary-policy autonomy and exchange rate regimes. This result is…


636. Tacit Collusion and Capacity Withholding in Repeated Uniform Price Auctions

Emmanuel Dechenaux and Dan Kovenock

This paper contributes to the study of tacit collusion by analyzing infinitely repeated multiunit uniform price auctions in a symmetric oligopoly with capacity constrained firms. Under both the Market Clearing and Maximum Accepted Price rules of…


635. Exposure-based Cash-Flow-at-Risk under Macroeconomic Uncertainty

Niclas Andrén, Håkan Jankensgård and Lars Oxelheim

In this paper we derive an exposure-based measure of Cash-Flow-at-Risk (CFaR). Existing approaches to calculating CFaR either only focus on cash flow conditional on market changes or neglect market-risk exposures entirely. We argue here that an essential…


634. Acquisition Strategies: Empirical Evidence of Outsider-Toeholds

Tobias Lindqvist

Theoretically, cross ownership may mitigate mergers, i.e. market concentrations. Holding a share in a competing firm before the acquisition of another firm, outsider-toehold, is more profitable in some market constellations, due to the positive…

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