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Robust decision making implies welfare costs or robustness premia when the approximating model is the true data generating process. To examine the importance of these premia at the aggregate level we employ a simple two-sector dynamic general equilibrium model with human capital and introduce an...
Persistent link: https://www.econbiz.de/10008697052
Persistent link: https://www.econbiz.de/10003496553
This paper extends the transformed maximum likelihood approach for estimation of dynamic panel data models by Hsiao, Pesaran, and Tahmiscioglu (2002) to the case where the errors are cross-sectionally heteroskedastic. This extension is not trivial due to the incidental parameters problem that...
Persistent link: https://www.econbiz.de/10009570680
Quarterly GDP figures usually are published with a delay of some weeks. A common way to generate GDP series of higher frequency, i.e. to nowcast GDP, is to use available indicators to calculate a single index by means of a common factor derived from a dynamic factor model (DFM). This paper deals...
Persistent link: https://www.econbiz.de/10010229863
To synthesize the literature on determinants of the shadow economy, this paper uses three cross-national shadow economy measures and employs numerous determinants over hundreds of model combinations to identify robust determinants of the shadow economy and address modeling uncertainty. We find...
Persistent link: https://www.econbiz.de/10011457984
In this paper, we study a two-country dynamic setup with environmental externalities and potential model misspecification in relation to this public good. Under model uncertainty, robust policies help to correct the inefficiencies associated with free riding on public good provision, implying...
Persistent link: https://www.econbiz.de/10009682338
Theoretical considerations suggest that nonlinear health care price schedules have heterogeneous effects on health care demand. In this paper, we develop and apply a finite mixture bivariate probit model to analyze whether there are heterogeneous reactions to the introduction of a nonlinear...
Persistent link: https://www.econbiz.de/10010212657
This paper revisits the airline schedule-buffer choice problem analyzed by Brueckner, Czerny and Gaggero (2020) using a simpler model where the random shocks influencing flight times are discrete rather than continuous. The analysis yields closed-form solutions for the flight and ground buffers...
Persistent link: https://www.econbiz.de/10012270584
We consider a multi-service transportation system in which passengers are heterogeneous along two dimensions, namely ideal departure time and value of time, leading to both horizontal and vertical differentiation. We investigate the behavior of passengers, and assess how service pricing and...
Persistent link: https://www.econbiz.de/10012103986
This paper presents an extensive theoretical and empirical analysis of the choice of schedule buffers by airlines. With airline delays a continuing problem around the world, such an undertaking is valuable, and its lessons extend to other passenger transportation sectors. One useful lesson from...
Persistent link: https://www.econbiz.de/10012110214