We investigate the impact of the 2005 UK Disability Discrimination Act on the educational and employment outcomes for older children with disabilities, using data from the UK Labour Force Surveys. The Act established new legal requirements on employers and qualification awarding bodies to accommodate individuals with disabilities. Furthermore, prior to 2013 children in England and Wales could leave education at age 16, providing a unique opportunity to analyse the 2005 Act's influence on their educational and employment outcomes. Compared to children without disabilities, we found the 2005 Act reduced the likelihood of continuing in education and increased the likelihood of entering the labour market (employed or unemployed) for children meeting both the 1995 Disability Discrimination Act definition of disability and who were reported as work-limited. We also ‘decompose’ average outcomes between children's groups, identifying effects attributable to observable characteristics, discrimination, and unobservable health-related productivity gaps.

We ask whether firms behave differently depending on the political party in charge, above and beyond responding to any actual differences in policy. We use the pollution abatement behaviour of U.S. Steam Electric Power Plants under the Clean Water Act as our case study. Exploiting the variation provided by the outcome of tightly contested gubernatorial elections, we provide causal evidence that large firms respond to the political ‘colour’ of the governor in the state they operate, even when neither the stringency nor the enforcement of the rules depend on it. Within a theoretical model of the interaction between the regulator and the regulated firms, we show that multiple equilibria arise, and the outcomes of the election provide an effective coordination device. This unexpected behaviour has real-world consequences and leads to significant differences in pollution levels.

We introduce the Knowledge Origin Re-Combination Index (KORCI) to measure the ex-ante technological novelty of inventions at the sectoral level. The index is developed through the intertemporal comparison of a sequence of networks, which represents the complex connections between the technological components listed in subsequent cohorts of patent applications. This allows us to quantify the intensity of the recombination of components and the introduction of new ones at the frontier of technological knowledge. Using patent data from three sectors – artificial intelligence, computer technology, and pharmaceuticals – we are the first to document the cyclical nature of the evolution of ex-ante technological novelty of inventions across all three sectors. These evolutionary cycles, however, are not synchronized, and therefore it is unlikely that they are driven by a common innovation engine. Further investigation into the correlation between KORCI and patent growth rates reveals other differences among the sectors in both direction and strength. We conjecture that the relation between the degree of ex-ante technological novelty and invention activities depends on the specific innovation environment of the sector – whether these are process-based or product-based. Our new tool opens opportunities for new empirical research into the evolution of innovation at the sectoral level.

We investigate the stability of cooperation agreements, such as those agreed by cartels, among firms in a Cournot model of oligopolistic competition embedded in a multimarket contact setting. Our analysis considers a broad array of 64 potential market structural configurations under linear demand and quadratic production costs. We establish that for an appropriate range of parameter values there exists a unique core stable market configuration in which an identical two-firm cartel is sustained in both markets. Our result highlights the significance of multimarket presence for cartel formation in light of the well-known result from the single-market setting where cartels are non-profitable.

This paper analyzes theoretically and empirically how upstream markets are affected by deregulation downstream. Deregulation tends to increase the level of uncertainty in the upstream market. Our theoretical analysis predicts that deregulated firms respond to this increase in uncertainty by writing more rigid contracts with their suppliers. Using the restructuring of the electricity market in the U.S. as our case study, we find support for our theoretical predictions. Furthermore, we investigate the impact this change in procurement contracts has on efficiency. Focusing on coal mines, we find that those selling coal to plants in restructured markets are significantly more productive than their counterparts working with regulated plants. On the other hand, we also find that transaction costs may have increased as a consequence of deregulation.

We consider a normal-form game in which there is a single exogenously given coalition of cooperating players that can write a binding agreement on pre-selected actions. The actions representing other dimensions of the strategy space remain under the sovereign, individual control of the players. We consider a standard extension of the Nash equilibrium concept denoted as a partial cooperative equilibrium as well as an equilibrium concept in which the coalition of cooperators has a leadership position. Existence results are stated and we identify conditions under which the various equilibrium concepts are equivalent. We apply this framework to existing models of multi-market oligopolies and international pollution abatement. In a multi-market oligopoly, typically, a merger paradox emerges in the partial cooperative equilibrium. The paradox vanishes if the cartel attains a leadership position. For international pollution abatement treaties, cooperation by a sufficiently large group of countries results in a Pareto improvement over the standard tragedy of the commons outcome described by the Nash equilibrium.

This study is an attempt to empirically examine the impact of foreign direct investment (FDI) on economic performance and investigate the spillover effects from the FDI inflows in the United Arab Emirates (UAE), using a detailed sectoral-level panel dataset covering the period 2006 - 2014. The main empirical finding indicates that FDI has a mixed impact on economic performance in UAE and this effect depends on the sectoral characteristics and geographical destinations. In contrast, the results further show that the FDI from more technologically advanced countries tend to have a positive impact on economic activity. The findings suggest that the FDI inflows from countries with far distance of UAE seem to bring high benefit quality of technology.

We consider one-to-one matching problems under two modalities of uncertainty in which types are assigned to agents either with or without replacement. Individuals have preferences over the possible types of the agents from the opposite market side and initially know the ‘name’ but not the ‘type’ of their potential partners. In this context, learning occurs via matching and using Bayes’ rule. We introduce the notion of a stable and consistent outcome, and show how the interaction between blocking and learning behavior shapes the existence of paths to stability in each of these two uncertainty environments. Existence of stable and consistent outcomes then follows as a side result.

In this paper we consider one-to-many matching problems where the preferences of the agents involved are represented by monetary reward functions. We characterize Pareto optimal matchings by means of contractual exchange stability and matchings of maximum total reward by means of compensational exchange stability. To conclude, we show that in going from an initial matching to a matching of maximum total reward, one can always provide a compensation schedule that will be ex-post stable in the sense that there will be no subset of agents who can all by deviation obtain a higher reward. The proof of this result uses the fact that the core of an associated compensation matching game with constraints is nonempty.

Researchers have utilized the fact that many states have term limits (as opposed to being eligible for reelection) for governors to determine how changes in electoral incentives alter state regulatory agency behavior. This paper asks whether these impacts spill over into private sector decision-making. Using data from gubernatorial elections in the U.S., we find strong evidence that power plants spend less in water pollution abatement if the governor of the state where the plant is located is a term-limited democrat. We show that this evidence is consistent with compliance cost minimization by power plants reacting to changes in the regulatory enforcement. Finally, we show that the decrease in spending has environmental impacts as it leads to increased pollution. JEL classifications: H32, H76, Q25, Q53, Q58

In many applications of coalition formation games, a key issue is that some desirable coalition structures are not elements of the core of these games. In these cases, it would be useful for an authority which aims to implement a certain outcome to know how far from the original game is the nearest game where the desirable outcome is part of the core. This question is at the center of this study. Focusing on hedonic games, we uncover previously unexplored links between such games and transferrable utility games, and develop a tailor-made so- lution concept for the transferrable utility game, the implementation core, to provide an answer to our question.

Download This Paper Open PDF in Browser Add Paper to My Library Share: Permalink Using these links will ensure access to this page indefinitely Copy URL Electoral Incentives and Firm Behavior: Evidence from U.S. Power Plant Pollution Abatement 28 Pages Posted: 18 Nov 2016 See all articles by Matthew DoyleMatthew DoyleUniversity of WaterlooCorrado Di MariaUniversity of East AngliaIan LangeUniversity of Stirling - Department of EconomicsEmiliya A. LazarovaQueen's University Belfast Date Written: October 18, 2016 Abstract Researchers have utilized the fact that many states have term limits (as opposed to being eligible for re-election) for governors to determine how changes in electoral incentives alter state regulatory agency behavior. This paper asks whether these impacts spill over into private sector decision-making. Using data from gubernatorial elections in the U.S., we find strong evidence that power plants spend less in water pollution abatement if the governor of the state where the plant is located is a term-limited democrat. We show that this evidence is consistent with compliance cost minimization by power plants reacting to changes in the regulatory enforcement. Finally, we show that the decrease in spending has environmental impacts as it leads to increased pollution. Keywords: political economy, electoral incentives, term limits, environmental policy, pollution abatement, compliance costs, power plants, water pollution, regression discontinuity JEL Classification: H320, H760, Q250, Q530, Q580 Suggested Citation: Suggested Citation Doyle, Matthew and Di Maria, Corrado and Lange, Ian and Lazarova, Emiliya A., Electoral Incentives and Firm Behavior: Evidence from U.S. Power Plant Pollution Abatement (October 18, 2016). Available at SSRN: https://ssrn.com/abstract=2871168 Matthew Doyle University of Waterloo ( email ) Waterloo, Ontario N2L 3G1Canada Corrado Di Maria (Contact Author) University of East Anglia ( email ) Norwich Research ParkNorwich, Norfolk NR4 7TJUnited Kingdom441603592866 (Phone) Ian Lange University of Stirling - Department of Economics ( email ) Stirling, FK9 4LAUnited Kingdom Emiliya A. Lazarova Queen's University Belfast ( email ) 25 University SquareBelfast, BT7 1NNIreland Download This Paper Open PDF in Browser Do you have a job opening that you would like to promote on SSRN? 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We consider an economy in which agents are embedded in a network of potential value-generating relationships. Agents are assumed to be able to participate in three types of economic interactions: Autarkic self-provision; bilateral interaction; and multilateral collaboration through endogenously provided platforms.We introduce two stability concepts and provide sufficient and necessary conditions on the network structure that guarantee existence, in cases of the absence of externalities, link-based externalities and crowding externalities. We show that institutional arrangements based on socioeconomic roles and leadership guarantee stability. In particular, the stability of more complex economic outcomes requires more strict and complex institutional rules to govern economic interactions. We investigate strict social hierarchies, tiered leadership structures and global market places.

This paper analyzes theoretically and empirically how upstream markets are affected by deregulation downstream. Deregulation tends to increase the level of uncertainty in the upstream market. Our theoretical analysis predicts that deregulated firms respond to this increase in uncertainty by writing more rigid contracts with their suppliers. Using the restructuring of the electricity market in the U.S. as our case study, we find support for our theoretical predictions. Furthermore, we investigate the impact this change in procurement contracts has on efficiency. Focusing on coal mines, we find that those selling coal to plants in restructured markets are significantly more productive than their counterparts working with regulated plants. On the other hand, we also find that transaction costs may have increased as a consequence of deregulation. JEL classifications: L14, L15, Q31, Q48

We study group formation by heterogeneous players when players' preferences are dictated by status-seeking. Status can be intrinsic or associative. Considering these two types of status as either complements or substitutes results in non-emptiness of the core of the corresponding games and allows for a full characterization of the core stable outcomes.

In this empirical investigation we study the effect of skilled emigration on human capital formation and growth in a sample of developing countries. We find that the migration rate exerts statistically significant effects on both the level and the skill composition of human capital. We also show that these migration-induced changes in the formation of human capital affect the growth performance of sending countries. The sign and the magnitude of these effects are shown to depend on the level of economic development of the sending country. Both the least and the most developed countries in our sample would suffer as a result of an increase in skilled migration, while countries at intermediate stages of development may benefit. Overall, the majority of sending countries are shown to lose from migration, and the losses that accrue to the least developed ones are larger than the benefits for the winners.

We investigate how a group of players might cooperate with each other within the setting of a non-cooperative game. We pursue two notions of partial cooperative equilibria that follow a modification of Nash's best response rationality rather than a core-like approach. Partial cooperative Nash equilibrium treats non-cooperative players and the coalition of cooperators symmetrically, while the notion of partial cooperative leadership equilibrium assumes that the group of cooperators has a first-mover advantage. We prove existence theorems for both types of equilibria. We look at three well-known applications under partial cooperation. In a game of voluntary provision of a public good we show that our two new equilibrium notions of partial cooperation coincide. In a modified Cournot oligopoly, we identify multiple equilibria of each type and show that a non-cooperator may have a higher payoff than a cooperator. In contrast, under partial cooperation in a symmetric Salop City game, a cooperator enjoys a higher return.

We study dynamic multilateral markets, in which players’ payoffs result from intra-coalitional bargaining. The latter is modeled as the ultimatum game with exogenous (time-invariant) recognition probabilities and unanimity acceptance rule. Players in agreeing coalitions leave the market and are replaced by their replicas, which keeps the pool of market participants constant over time. In this infinite game, we establish payoff uniqueness of stationary equilibria and the emergence of endogenous cooperation structures when traders experience some degree of (heterogeneous) bargaining frictions. When we focus on market games with different player types, we derive, under mild conditions, an explicit formula for each type’s equilibrium payoff as the market frictions vanish.

We consider a network economy in which economic agents are connected within a structure of value-generating relationships. Agents are assumed to be able to participate in three types of economic activities: autarkic self-provision; binary matching interactions; and multi-person cooperative collaborations. We introduce two concepts of stability and provide sufficient and necessary conditions on the prevailing network structure for the existence of stable assignments, both in the absence of externalities from cooperation as well as in the presence of size-based externalities. We show that institutional elements such as the emergence of socioeconomic roles and organizations based on hierarchical leadership structures are necessary for establishing stability and as such support and promote stable economic development.

In a two-sided coalitional matching problem agents on each side of the market simultaneously form coalitions which then are matched to coalitions from the other market side. We assume that each agent has preferences over groups on his own market side and over groups on the opposite market side. These preferences are combined lexicographically as to examine how the existence of core stable partitions on the distinct market sides, the restriction of agents’ preferences over groups to strict orderings, and the extent to which individual preferences respect common rankings shape the existence of core stable coalitional matchings.