We model group formation as a response to relative deprivation. We employ a simple measure of relative deprivation. We show that the process of deprivationinduced self-selection into groups reaches a unique steady state. We study the social welfare implications of the deprivation-induced process of group formation and show that when individuals are left to pursue their betterment the resulting ...

Job Competition and the Wage Curve The wage curve literature consistently finds a negative relationship between regional unemployment rates and regional wages; the most widely accepted theoretical explanations interpret the unemployment rate as a measure of job competition. This paper proposes new ways of measuring job competition, alternative to the unemployment rate, and finds that the negati...

The theoretical framework of urban and regional economics is built on transportation costs for manufactured goods. But over the twentieth century, the costs of moving these goods have declined by over 90% in real terms, and there is little reason to doubt that this decline will continue. Moreover, technological change has eliminated the importance of fixed infrastructure transport (rail and wat...

High levels of immigration to the United States have caused the size of the foreign-born population to increase dramatically in recent years. Recent immigrants are concentrated in several states, particularly California. This paper examines the determinants of the intended state of residence of new recipients of legal permanent-resident status and new refugees over the 1989–94 period. The prese...

This paper proposes a new panel model of cross-sectional dependence. The model has a number of potential structural interpretations that relate to economic phenomena such as herding in financial markets. On an econometric level, it provides a flexible approach of modelling interactions across panel units and can generate endogenous cross-sectional dependence that can resemble the dependence tha...

The Effect of Weather-Induced Internal Migration on Local Labor Markets: Evidence from Uganda Relying on census data collected in 2002 and historical weather data for Uganda, we estimate the impact of weather-induced internal migration on the probability for non-migrants living in the destination regions to be employed. Our results reveal a significant negative impact. Consistent with the predi...

This paper tests empirically the hypothesis that the greater the intangibility of a firm’s resources, the greater the sustainability of its competitive advantage. Resource intangibility is measured by: (1) Tobin’s q and (2) the predicted value from a hedonic regression of q on several accounting measures of intangibles. Sustainability is measured by the persistence of firm-specific profits. Usi...

Both financing and risk management involve promises to pay that need to be collateralized, resulting in a financing versus risk management trade-off. We study this trade-off in a dynamic model of commodity price risk management and show that risk management is limited and that more financially constrained firms hedge less or not at all. We show that these predictions are consistent with the evi...

Social sanctions may be a strong deterrent of crime. This paper presents a formal model that relates crime and social sanction to social interaction density. We empirically test the theoretical predictions using a provincial level panel dataset on different crimes in Italy between 1996 and 2003. We exploit detailed demographic and geo-morphological information to develop exogenous measures of s...

The conventional Sargan (1958) / Hansen (1982) test of overidentifying restrictions and the Tilting Parameter test of Imbens, Spady and Johnson (1998) are compared in the context of the AR(1) dynamic panel data model using Monte Carlo experiments. Interestingly, the size properties of the former are found to be superior in this setting. Nevertheless, the Sargan / Hansen test is found to have no...