We study the short- and long-run implications of offshoring on innovation, technology adoption, wage and income inequality in a Ricardian model with directed technical change. In our model, profit maximization determines both the extent of offshoring and the direction of technological progress....

The classic theory of fiscal federalism suggests that different people should have different governments. Yet, separate local governments with homogeneous constituents often end up doing poorly. This paper explains why and answers three questions: when regions are heterogeneous, what determines...

We study the effects of the adoption of new agricultural technologies on structural transformation. To guide empirical work, we present a simple model where the effect of agricultural productivity on industrial development depends on the factor bias of technical change. We test the predictions...

In a financial contracting model, we study the optimal debt structure to resolve financial distress. We show that a debt structure where two distinct debt classes co-exist - one class fully concentrated and with control rights upon default, the other dispersed and without control rights -...

We study the gains from increased wage flexibility and their dependence on exchange rate policy, using a small open economy model with staggered price and wage setting. Two results stand out: (i) the impact of wage adjustments on employment is smaller the more the central bank seeks to stabilize...

Panel data can be arranged into a matrix in two ways, called 'long' and 'wide' formats (LF and WF). The two formats suggest two alternative model approaches for analyzing panel data: (i) univariate regression with varying intercept; and (ii) multivariate regression with latent variables (a...

We develop a two-sided matching model to analyze collaboration between heterogeneous academics and firms. We predict a positive assortative matching in terms of both scientific ability and affinity for type of research, but negative assortative in terms of ability on one side and affinity in the...

This work proposes novel network analysis techniques for multivariate time series. We define the network of a multivariate time series as a graph where vertices denote the components of the process and edges denote non zero long run partial correlations. We then introduce a two step LASSO...

This paper takes a regional studies approach to assess spin-offs from a university-based technology transfer network. We first detect the regional objectives, inputs and outputs needed to assess spin-offs from support programmes. We then provide evidence on regional mechanisms for firm creation....

In many areas of economics there is a growing interest in how expertise and preferences drive individual and group decision making under uncertainty. Increasingly, we wish to estimate such models to quantify which of these drive decision making. In this paper we propose a new channel through...