Katariina Nilsson Hakkala, Fredrik Heyman and Fredrik Sjöholm
We use Swedish matched employer-employee data to analyze the impact of multinational activity and foreign acquisitions on the relative demand for different job tasks. We contribute to the literature by using a conceptualization from the recent literature…
Lars Oxelheim and Clas Wihlborg
Traditional methods for evaluating corporate credit risk rarely consider the impact of the macro economy on corporate value and performance. We argue that lenders and management can obtain valuable information about the need for and approach to…
Erik Grönqvist and Jonas Vlachos
Teachers are increasingly being drawn from the lower parts of the general ability distribution, but it is not clear how this affects student achievement. We track the position of entering teachers in population-wide cognitive and non-cognitive ability…
Robin Douhan and Anders Nordberg
It is often assumed that recent success in the high-technology software industry will lead India's development. However, evidence suggest that basic manufacturing industry is stagnant. This paper proposes a mechanism that ties these two trends together. A…
Richard Friberg, Pehr-Johan Norbäck and Lars Persson
We propose a model of investments prior to corporate ownership changes. We derive conditions under which the selling of a firm triggers overinvestment by both the seller and the buyer prior to the asset transfer. In a setting with Cournot competition, we…
Simona Fabrizi, Steffen Lippert, Pehr-Johan Norbäck and Lars Persson
In this paper we construct a model in which entrepreneurial innovations are sold into oligopolistic industries and where adverse selection problems between entrepreneurs, venture capitalists and incumbents are present. We show that as exacerbated…
Anders Björklund, Jesper Roine and Daniel Waldenström
This paper presents new evidence on intergenerational mobility in the top of the income and earnings distribution. Using a large dataset of matched father-son pairs in Sweden, we find that intergenerational transmission is very strong in the top, more so…
Per Skedinger
Swedish minimum wages are not regulated by law, but subject to bargaining between employers and trade unions and form part of collective agreements. This paper provides an overview of the Swedish minimum wage system, its characteristics and effects on…
Sven-Olof Fridolfsson and Thomas Tangerås
We review the recent empirical research concerning market power on the Nordic wholesale market for electricity, Nord Pool. There is no evidence of blatant and systematic exploitation of system level market power on Nord Pool. However, generation companies…
Olivier Bertrand, Katariina Nilsson Hakkala, Pehr-Johan Norbäck and Lars Persson
We analyze how the entry mode of Foreign Direct Investments (FDI) affects affiliate R&D activities. Using unique affiliate level data for Swedish multinational firms, we first present empirical evidence that acquired affiliates have a higher level of…
Magnus Henrekson and Anders Lundström
The International Award for Entrepreneurship and Small Business Research was instituted in 1996, and it is now firmly established as the leading Prize for outstanding research contributions in the area. Thanks to a generous donation from the Swedish…
Mikael Elinder, Henrik Jordahl and Panu Poutvaara
We present and test a theory of prospective and retrospective pocketbook voting. Focusing on two large reforms in Sweden, we establish a causal chain from policies to sizeable individual gains and losses and then to voting. The Social Democrats proposed…
Bernard Hoekman, Henrik Horn and Petros C. Mavroidis
A significant body of research has sought to examine claims that developing countries are under-represented as complainants, and/or over-represented as respondents in the WTO dispute settlement system. Most of this literature has focused on their…
Lars Oxelheim
The process of globalization encompasses economic and financial integration. Abolition of capital controls and dismantling of barriers of different kinds are important ingredients of the process that will entirely change the exposure of previously…
Jens Forssbaeck and Lars Oxelheim
In this paper we empirically test the role of firm-specific financial characteristics as drivers of international investment and production. We hypothesize that financial strength generates advantages that can be exploited through cross-border investment…
Robin Douhan and Magnus Henrekson
This paper reconsiders the predominant typology pioneered by Baumol (1990) among productive, unproductive and destructive entrepreneurship. It is shown that the foundation of Baumol’s classificatory scheme is the restrictive concept of first-best…
David Cesarini, Magnus Johannesson, Paul Lichtenstein, Örjan Sandewall and Björn Wallace
In this paper, we use a sample of almost 30,000 Swedish mono- and dizygotic twins to study the heritability of financial risk-taking. Following a major pension reform in the year 2000, virtually all Swedish adults had to simultaneously make a finnancial…
Jenny Nykvist
A large literature has studied the effect of displacement on labor market outcomes in general, but none has evaluated how the displaced manage as self-employed. This paper studies how the survival of the business is affected by displacement in connection…
Assar Lindbeck and Mats Persson
We develop a simple yet realistic model of income insurance, where the individual’s ability and willingness to work is treated as a continuous variable. In this framework, income insurance not only provides income smoothing, it also relieves the…
Henrik Jordahl, Panu Poutvaara and Juha Tuomala
In a recent paper, García-Mainar and Montuenga-Gómez (2005) apply the generalized IV model of Hausman and Taylor to estimate education returns of wage earners and the self-employed in Portugal and in Spain. Our examination reveals several problems which…
Robin Douhan and Magnus Henrekson
Recent research has highlighted the role of institutions in channeling entrepreneurs into activities with positive or negative effects on overall productivity. Embedding central elements from these theories into a political economy framework reveals the…
Israel M. Kirzner
Israel M. Kirzner is the 2006 winner of The International Award for Entrepreneurship and Small Business Research (the FSF-Nutek Award). In this Prize Lecture he argues that a number of those who have commented on his work have misunderstood certain…
Roger Svensson
I apply a survival model to a detailed dataset of Swedish patents to estimate how different factors affect the likelihood of patent renewal. Since the owners know more about the patents than potential external financiers, there is a problem of asymmetric…
Andrea Asoni
While the importance of institutions for explaining cross-country income differences is widely recognized, comparatively little is known about the origins of economic institutions. One strand of the literature emphasizes cultural differences while another…
Magnus Henrekson and Dan Johansson
High-growth firms (HGFs) are critical for net job creation and economic growth. We analyze HGFs using the theory of competence blocs, linking firm growth to property rights and the interaction of complementary expertise. Specifically, we discuss how the…
Pär Holmberg
Forward sales is a credible commitment to aggressive spot market bidding, and it mitigates producers’ market power in electricity markets. Still it can be profitable for a producer to make such a commitment if it results in a soft response from…
Yves Zenou
We develop a model where information about jobs is essentially obtained through friends and relatives, i.e. strong and weak ties. Workers commute to a business center to work and to interact with other people. We find that housing prices increase with the…
Yan Song and Yves Zenou
This article attempts a formal analysis of the connection between the differentiated property tax rates within urban areas and urban spatial pattern in U.S. cities. We first develop a duocentric-city model where the Central Business District (CBD) is…
Stephen L. Ross and Yves Zenou
Recent theoretical work has examined the spatial distribution of unemployment using the efficiency wage model as the mechanism by which unemployment arises in the urban economy. This paper extends the standard efficiency wage model in order to allow for…
Yves Zenou
We propose a spatial search-matching model where both job creation and job destruction are endogenous. Workers are ex ante identical but not ex post since their job can be hit by a technological shock, which decreases their productivity. They reside in a…
Thomas Tangerås
This is a game-theoretic analysis of the link between regime type and international conflict. The democratic electorate can credibly punish the leader for bad conflict outcomes, whereas the autocratic selectorate cannot. For the fear of being thrown out…
Erik Lindqvist
A wide range of services provided by the public sector are credence goods, i.e., services for which the producer has private information whether a certain treatment is needed or not. This paper studies how ownership affects the incentives for producers to…
Erik Lindqvist and Robert Östling
We study the effect of political polarization on government spending and redistribution using the dispersion of self-reported political preferences as our measure of polarization. Politically polarized countries have lower levels of redistribution and…
Joacim Tåg
Private firms may not have efficient incentives to allow third-party producers to access their platform or develop extensions for their products. Based on a two-sided market model, I discuss two reasons for why. First, a private firm may not be able to…
Joacim Tåg
This paper studies an industry in which firms can choose to provide open or closed platforms. Open platforms, as opposed to closed, are extendable so third-party producers can develop extensions for them. Building on a two-sided market model, I show that…
Lars Oxelheim, Clas Wihlborg and Jianhua Zhang
Macroeconomic fluctuations affect corporations’ performance through demand and cost conditions. Incentive effects of performance-based compensation schemes for management may be weakened or biased by macroeconomic influences if management is unable to…
Lars Oxelheim and Pervez Ghauri
In this paper it is argued that the restructuring following the stiffer competition stemming from increased global integration will trigger a race between countries to attract inward foreign direct investment (FDI). It is further argued that this race…
Richard Friberg, Pehr-Johan Norbäck and Lars Persson
We provide a model that explains the following empirical observations: i) private ownership is more efficient than public ownership, ii) privatizations are associated with increases in efficiency and iii) the increase in efficiency predates the…
Pehr-Johan Norbäck and Lars Persson
We provide facts showing that in service markets: (i) restrictions on foreign direct investment (FDI) are under reform, (ii) cross-border Mergers & Acquisitions dominate as the entry mode of FDI, and (iii) there is often a high market concentration.…
Harald Edquist
Rapid price decreases for ICT-products in the 1990s have been largely attributed to the introduction of hedonic price indexes. Would hedonic price indexing also have large effects on measured price and productivity during other technological…
Jens Forssbæck and Lars Oxelheim
We argue that mainstream FDI theory underplays financial motivations for interna-tional investment, and suggest several possible channels for a distinct cost-of-capital effect on FDI. Using a sample of European firms’ cross-border acquisitions, and…
Henrik Horn and Petros C. Mavroidis
The purpose of this paper is to report some initial findings based on the WTO Dispute Settlement Data Set (Ver. 2.0) that the authors have compiled for the World Bank. The data set contains approximately 28 000 observations on the workings of the Dispute…
Henrik Horn and Petros C. Mavroidis
Trading nations exchange tariff concessions in the context of trade liberalizing rounds. Tariffs, nonetheless, are not the only instrument affecting the value of a concession. Domestic instruments affect it as well, but public order is not negotiable,…
Maria Bigoni, Sven-Olof Fridolfsson, Chloé Le Coq and Giancarlo Spagnolo
This paper reports results from an experiment studying how fines, leniency programs and reward schemes for whistleblowers affect cartel formation and prices. Antitrust without leniency reduces cartel formation, but increases cartel prices: subjects use…
Andrea Asoni
This paper presents a survey of the literature on property rights and economic growth. It discusses different theoretical mechanisms that relate property rights to economic development. Lack of protection of property rights can result in slow economic…
Erik Lindqvist
I develop a model of public sector contracting based on the multitask framework by Holmström and Milgrom (1991). In this model, an agent can put effort into increasing the quality of a service or reducing costs. Being residual claimants, private owners…
Erik Lindqvist and Robert Östling
This paper models the interaction between individuals' identity choices and redistribution. Both redistributive polices and identity choices are endogenous, and there might be multiple equilibria. The model is applied to ethnicity and social class. In…
Fredrik Heyman, Helena Svaleryd and Jonas Vlachos
Theories of taste-based discrimination predict that competitive pressures will drive discriminatory behavior out of the market. Using detailed matched employer-employee data, we analyze how firm takeovers and product market competition affect firms’…
Magnus Henrekson and Dan Johansson
It is often claimed that small and young firms account for a disproportionately large share of net employment growth. We conduct a meta analysis of the empirical evidence regarding whether net employment growth rather is generated by a few rapidly growing…
Magnus Henrekson and Tino Sanandaji
Taxation theory rarely takes entrepreneurship into consideration. We discuss how this omission affects conclusions derived from standard models of capital taxation when applied to entrepreneurial income.
Some of the defining features of entrepreneurship…
Assar Lindbeck
It is useful to distinguish between exogenous and endogenous factors behind contemporary and expected future problems for the welfare state. This paper tries to identify major problems of both types and to indicate alternative reform possibilities to deal…
Joseph Francois, Henrik Horn and Niklas Kaunitz
It has been alleged since its inception that the WTO Dispute Settlement (DS) mechanism is biased against developing countries, as manifested in e.g. allegedly too low rates of dispute initiation. To shed light on this issue, this study analyses the…
Fredrik Heyman
I use Swedish establishment-level panel data to test Bertola and Rogerson’s (1997) hypothesis of a positive relation between the degree of wage compression and job reallocation. Results indicate that the effect of wage compression on job turnover is…
Johan Almenberg and Anna Dreber
We examine a relatively neglected aspect of intergenerational transmission of economic standing, namely culturally determined status markers and their valuation in the marriage market. We take nobility to be such a status marker. Using data on Swedish…
Nicholas Economides and Joacim Tåg
We discuss network neutrality regulation of the Internet in the context of a two-sided market model. Platforms sell broadband Internet access services to residential consumers and may set fees to content and application providers on the Internet. When…
Mattias Ganslandt
Intellectual property rights and competition policy are intimately related. In this paper I survey the economic literature analyzing the interaction between intellectual property law and competition law and how the boundary between these two policies is…