This paper provides preliminary evidence that interest groups reduce both the level and the volatility of returns on a national stock market. These findings are robust to model specifications that include traditional growth regression “policy” variables as well as political, economic, and financial institutions variables. The estimated magnitude of the relationship between interest group activi...

Despite widespread belief that membership in the World Trade Organization (WTO) improves the quality of governance, there is no convincing empirical evidence. Here, we investigate whether WTO membership has a causal effect on firm-level reports of political corruption using a nonparametric partial identification approach to bound the average treatment effect (ATE). We also analyze conditional A...

We implement an endogeneous switching-regression model for labour productivity and firms’ decision to use business–to–business (B2B) e–commerce. Our approach allows B2B usage to affect any parameter of the labour productivity equation and to properly take account of strategic complementarities between the input factors and B2B usage. Empirical evidence from 1,394 German firms shows that firms u...

Using many valid instrumental variables has the potential to improve efficiency but makes the usual inference procedures inaccurate. We give corrected standard errors, an extension of Bekker (1994) to nonnormal disturbances, that adjust for many instruments. We find that this adujstment is useful in empirical work, simulations, and in the asymptotic theory. Use of the corrected standard errors ...

Researchers are often interested in combined measures such as overall ratings, indices of physical or mental health, or health-related quality-of-life (HRQoL) outcomes. Such measures are typically composed of two or more underlying discrete variables. I show that estimating the effect of a treatment on the combined measure is biased with non-random treatment selection. I provide a solution to t...

In quantifying the impact of insurance on health care demand, most quasiexperimental studies focus on mean spending and consumption, which, considering the highly-skewed shapes of spending and consumption, potentially hides important information about how insurance is related to health care demand. This paper, by contrast, examines the entire distribution of health care demand. To address insur...

In a Regression Kink (RK) design with a finite sample, a confounding smooth nonlinear relationship between an assignment variable and an outcome variable around a threshold can be spuriously picked up as a kink and result in a biased estimate. In order to investigate how well RK designs handle such confounding nonlinearity, I firstly implement Monte Carlo simulations and then study the effect o...

We estimate the relation between union presence and executive compensation using a unique panel of executives in publicly listed US firms during the period 1992-2001. We find evidence that union presence is associated with lower levels of total executive compensation. We find this union effect to be primarily the result of substantially lower stock option awards, and to a lesser extent due to l...

Both the quality and quantity of human capital are important for growth. Although the quality aspects of human capital may have greater potential in explaining growth, given that the quantity effects of human capital have been found to be ambiguous, they have long been ignored in empirical growth literature. This paper empirically tests the joint effects of both the quantity and quality of huma...

This paper attempts to elucidate whether firm performance and macroeconomic conditions play a significant role in explaining credit default swap (CDS) spreads. Our panel dataset covers 112 reference entities in four markets (South Korea, Hong Kong, France, and Germany) for the period 2001-12. Overall, our results suggest that market value indicators (Tobin’s Q, stock market returns, and the int...