{"title":"Foreign passive ownership and tariff-induced free technology transfer under vertical integration","authors":"Chuyuan Zhang, Sang-Ho Lee","doi":"10.1111/manc.12428","DOIUrl":"https://doi.org/10.1111/manc.12428","url":null,"abstract":"<p>This study constructs a vertical structure model in which a foreign firm holds upstream partial passive ownership and examines tariff-induced free technology transfer from the firm to its downstream rival. We show that a strategic tariff can induce technology transfer when the share of foreign ownership is large, which always yields higher welfare under both vertical separation and integration, while vertical integration can better induce technology transfer. We also consider an extensive analysis with some variations, such as upstream or downstream competition, downstream passive ownership, government commitments to no-tariff policies, and foreign firm commitments to no-licensing strategies, and discuss policy implications regarding the pro-competitive effect of foreign passive ownership when free technology transfer is involved.</p>","PeriodicalId":47546,"journal":{"name":"Manchester School","volume":"91 2","pages":"89-117"},"PeriodicalIF":1.1,"publicationDate":"2023-02-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"50123961","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Does the employment effect of national minimum wage vary by non-employment rate? A regression discontinuity approach","authors":"Lei Xu, Yu Zhu","doi":"10.1111/manc.12427","DOIUrl":"https://doi.org/10.1111/manc.12427","url":null,"abstract":"<p>We extend the Regression Discontinuity model to evaluate the procyclicality of employment effect of minimum wage and show that previous estimates may be biased due to failure to account for the local non-employment rate. The results suggest that the positive employment effect of increasing minimum wage is strongly procyclical, that is, is more pronounced in areas with low non-employment rates. Under an assumption that employers have no direct impact around the cut-off point, the results suggest that a higher minimum wage increases labour supply of young workers.</p>","PeriodicalId":47546,"journal":{"name":"Manchester School","volume":"91 1","pages":"18-36"},"PeriodicalIF":1.1,"publicationDate":"2022-11-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/manc.12427","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"50155643","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Bank deposits and textual sentiment: When an European Central Bank president's speech is not just a speech","authors":"Dimitris Anastasiou, Apostolos Katsafados","doi":"10.1111/manc.12426","DOIUrl":"https://doi.org/10.1111/manc.12426","url":null,"abstract":"<p>We investigate whether the textual sentiment affects European depositors' behavior in withdrawing their deposits. We construct two textual sentiments able to capture the perceived uncertainty. Our findings suggest that a high frequency of uncertainty and weak modal words in the European Central Bank (ECB) president's monthly speeches leads both households and non-financial corporations to withdraw their bank deposits. We also find that non-financial corporations' deposits are more sensitive than households' deposits to these textual sentiments. These findings suggest that regulators and policymakers could expand the already existing early-warning systems for the banking sector by considering the frequency of uncertainty and weak modal words in the ECB president's speeches.</p>","PeriodicalId":47546,"journal":{"name":"Manchester School","volume":"91 1","pages":"55-87"},"PeriodicalIF":1.1,"publicationDate":"2022-11-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/manc.12426","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"50143231","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Managerial delegation, network externalities and loan commitment","authors":"Xubei Lian, Kai Zhang, Leonard F. S. Wang","doi":"10.1111/manc.12425","DOIUrl":"https://doi.org/10.1111/manc.12425","url":null,"abstract":"<p>In this paper, we show that, compared with no network externalities, firms always obtain higher profits and social welfare in the presence of positive network externalities, irrespective of the managerial delegation contracts. Furthermore, we show that whether the owner chooses market share delegation or sales delegation contracts relies on the type and strength of network externalities. If the network externalities are positive and strong enough, sales delegation dominates the market share delegation; otherwise, the owner will choose market share delegation. More importantly, we find that, if the network externalities are positive, the optimal interest rate of a loan commitment decreases with an increase of network externalities, and the firm's delegation behavior will benefit society regardless of the delegation contract types. On the contrary, the optimal interest rate increases with an increase of network externalities, and the firm's delegation behavior will harm social welfare in the presence of negative network externalities.</p>","PeriodicalId":47546,"journal":{"name":"Manchester School","volume":"91 1","pages":"37-54"},"PeriodicalIF":1.1,"publicationDate":"2022-11-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"50126578","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The effect of education on homeownership: Evidence from 20th century school attendance laws in the United States","authors":"Mary A. Silles","doi":"10.1111/manc.12421","DOIUrl":"https://doi.org/10.1111/manc.12421","url":null,"abstract":"<p>This article examines the causal impact of schooling on the probability of homeownership using decennial US Census data between 1960 and 2000. This is done by employing an instrumental variable approach that exploits historical changes in state mandatory schooling and child labour laws which affected the educational attainment of individuals with relatively low levels of schooling. Aggregate results suggest that policy-induced increases in schooling at the bottom of the educational distribution have a positive impact on homeownership rates of 1.9 percentage points. Disaggregated results reveal that the impact of education is highest among individuals who are located in the middle and top terciles of the income distribution with no effect of additional education in the lowest tercile. These results add to the growing body of literature which suggests that education may lead to positive outcomes beyond labour market earnings.</p>","PeriodicalId":47546,"journal":{"name":"Manchester School","volume":"91 1","pages":"1-17"},"PeriodicalIF":1.1,"publicationDate":"2022-09-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/manc.12421","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"50127193","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The leverage effect of bundling on monopoly power and product quality","authors":"Hui-Ling Chung, Jin-Li Hu, Yan-Shu Lin","doi":"10.1111/manc.12424","DOIUrl":"10.1111/manc.12424","url":null,"abstract":"<p>This paper re-examines the leverage effect of bundling under vertical quality differentiation. That is, it studies whether or not the firm can still extend its monopoly power from the monopolist product market to the competing product market by bundling under vertical product quality differentiation. There is an intangible product (such as cloud storage, after sale service, etc.) in a bundled package with vertical quality differentiation. The model herein enables us to further analyze the effects of bundling on a competitor's profit, consumer surplus, and social welfare when the bundler is a high- or low-quality firm and is facing a single-product competitor. When the bundling product is a high quality product, bundling reinforces the monopolist's market power toward the monopoly good, which runs opposite from the traditional leverage effect. If bundling enhances (shortens) the quality difference in competing goods, then bundling increases (reduces) both the competitor's profit and social welfare, whereas it decreases (increases) consumer surplus. Contrary to traditional literature, we find that mixed bundling may not be superior to pure bundling and the price discrimination via mixed bundling by the multi-product firm may enhance the consumer surplus.</p>","PeriodicalId":47546,"journal":{"name":"Manchester School","volume":"90 6","pages":"668-688"},"PeriodicalIF":1.1,"publicationDate":"2022-09-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"80667990","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"On interconsumer externalities in a model of sales","authors":"Evangelos Rouskas","doi":"10.1111/manc.12422","DOIUrl":"10.1111/manc.12422","url":null,"abstract":"<p>I highlight interconsumer externalities in a static model of sales with homogeneous products and bidimensional consumer heterogeneity wherein there exists two-type search intensity heterogeneity and two-type valuation heterogeneity. An increase in the percentage of consumers with high valuation creates a dichotomy in the market. The consumers who experience the increase in their valuation become better off; I call these consumers <i>privileged</i>. All other consumers either become worse off or remain unaffected; I call the consumers who become worse off <i>disadvantaged</i> and the consumers who remain unaffected <i>unprivileged</i>. In the environment with <i>privileged</i> and <i>disadvantaged</i> consumers, the net effect on total consumer surplus is ambiguous. These results come in contrast to a dynamic Coasian version of the model in which if the percentage of consumers with high valuation increases, always all consumers become better off. Public policy interventions that target an increase in the welfare of consumers by altering the mix of the population should (i) distinguish between dynamic and static markets; and (ii) take into account under which conditions in static markets the net effect on consumer surplus is positive.</p>","PeriodicalId":47546,"journal":{"name":"Manchester School","volume":"90 6","pages":"689-714"},"PeriodicalIF":1.1,"publicationDate":"2022-08-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"90895057","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Reviewing demand regimes in open economies with Penn World Table data","authors":"André M. Marques","doi":"10.1111/manc.12423","DOIUrl":"10.1111/manc.12423","url":null,"abstract":"<p>This paper uses the Penn World Table dataset to examine capacity utilization response to changes in the wage share in six developed countries from 1960 to 2019. Our vector autoregression model allows regression coefficients and volatilities to be time-varying in nature. A rolling window shows that capacity utilization response to the wage share is unstable. We find that a 1-standard deviation shock to the wage share generates a significant negative capacity utilization response in the U.S. and U.K. However, a rise in the wage share decreases capacity utilization of the remaining sample countries only conditional on exogenous wage share changes.</p>","PeriodicalId":47546,"journal":{"name":"Manchester School","volume":"90 6","pages":"730-751"},"PeriodicalIF":1.1,"publicationDate":"2022-08-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87768160","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Inflation persistence and monetary policy: DSGE-VAR approach","authors":"Kuo-Hsuan Chin","doi":"10.1111/manc.12420","DOIUrl":"10.1111/manc.12420","url":null,"abstract":"<p>We study the dynamics of U.S. inflation persistence and the sources resulting to it over the “Great Inflation” and “Great Moderation” periods. It is different from most of the current studies in that we consider a Bayesian VAR model with the DSGE prior, the so-called DSGE-VAR approach, in which the prior economic information is coming from a small-scale New Keynesian DSGE model. In the recursive estimation of the model, we find a decline in the inflation persistence, measured by the “half-life” response of inflation to the monetary policy shock, in the early 1980s. The stance of monetary policy, particularly the aggressive attitude toward the monetary policy implementation, plays an important role in explaining the structural change of the inflation persistence.</p>","PeriodicalId":47546,"journal":{"name":"Manchester School","volume":"90 6","pages":"715-729"},"PeriodicalIF":1.1,"publicationDate":"2022-08-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"84241786","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Economic impacts of UK's free trade agreements with Korea, Japan, and EU as a breakthrough of Brexit","authors":"Chae-Deug Yi","doi":"10.1111/manc.12419","DOIUrl":"10.1111/manc.12419","url":null,"abstract":"<p>With the UK-Korea-EU Free Trade Agreement (FTA) and the UK-Japan-EU FTA, the gross domestic products of the UK, Korea, Japan, and the EU will increase. The UK's exports to Korea and Japan, and Korea's exports to the UK, Japan, and the EU will increase in some manufacturing sectors, particularly the automotive sector. Likewise, Japan's manufacturing exports to the UK and the EU will grow. However, UK and Japanese exports to the EU and Korea, respectively, will decline in this sector. There will be positive welfare effects on the UK, Korea, and Japan, but negative welfare effects on the EU, China, and the rest of the world (ROW). While UK imports from Korea and Japan and Korean imports from the UK and the EU will both increase and have mixed trade creation and diversion effects, UK imports from the EU will decrease in the manufacturing sectors. Korea's imports from Japan will decline, but Japan's imports from the UK, Korea, and the EU will increase due to trade creation and diversion effects. China's imports from Korea and Japan will decline, whereas China's imports from the UK and the EU will increase. EU imports from Korea and Japan will increase due to trade creation and diversion effects, but EU imports from the UK, China, and the ROW will decline in most manufacturing sectors.</p>","PeriodicalId":47546,"journal":{"name":"Manchester School","volume":"90 5","pages":"541-564"},"PeriodicalIF":1.1,"publicationDate":"2022-07-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"80116280","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}