Ethnic Polarization, Potential Conflict, and Civil Wars

This paper analyzes the relationship between ethnic fractionalization, polarization, and conflict. In recent years many authors have found empirical evidence that ethnic fractionalization has a negative effect on growth. One mechanism that can explain this nexus is the effect of ethnic heterogeneity on rent-seeking activities and the increase in potential conflict, which is negative for investment. However the empirical evidence supporting the effect of ethnic fractionalization on the incidence of civil conflicts is very weak. Although ethnic fractionalization may be important for growth, we argue that the channel is not through an increase in potential ethnic conflict. We discuss the appropriateness of indices of polarization to capture conflictive dimensions. We develop a new measure of ethnic heterogeneity that satisfies the basic properties associated with the concept of polarization. The empirical section shows that this index of ethnic polarization is a significant variable in the explanation of the incidence of civil wars. This result is robust to the presence of other indicators of ethnic heterogeneity, other sources of data for the construction of the index, and other data structures.

Why ethnic fractionalization? Polarization, ethnic conflict and growth

This paper ia an attempt to clarify the relationship between fractionalization,polarization and conflict. The literature on the measurement of ethnic diversityhas taken as given that the proper measure for heterogeneity can be calculatedby using the fractionalization index. This index is widely used in industrialeconomics and, for empirical purposes, the ethnolinguistic fragmentation isready available for regression exercises. Nevertheless the adequacy of asynthetic index of hetergeneity depends on the intrinsic characteristicsof the heterogeneous dimension to be measured. In the case of ethnicdiversity there is a very strong conflictive dimension. For this reasonwe argue that the measure of heterogeneity should be one of the class ofpolarization measures. In fact the intuition of the relationship betweenconflict and fractionalization do not hold for more than two groups. Incontrast with the usual problem of polarization indices, which are ofdifficult empirical implementation without making some arbitrary choiceof parameters, we show that the RQ index, proposed by Reynal-Querol (2002),is the only discrete polarization measure that satisfies the basic propertiesof polarization. Additionally we present a derivation of the RQ index froma simple rent seeking model. In the empirical section we show that whileethnic polarization has a positive effect on civil wars and, indirectly ongrowth, this effect is not present when we use ethnic fractionalization.

Ethnic polarization, potential conflict and civil wars

This paper analyzes the relationship between ethnic fractionalization, polarization, and conflict. In recent years many authors have found empirical evidence that ethnic fractionalization has a negative effect on growth. One mechanism that can explain this nexus is the effect of ethnic heterogeneity on rent-seeking activities and the increase in potential conflict, which is negative for investment. However the empirical evidence supporting the effect of ethnic fractionalization on the incidence of civil conflicts is very weak. Although ethnic fractionalization may be important for growth, we argue that the channel is not through an increase in potential ethnic conflict. We discuss the appropriateness of indices of polarization to capture conflictive dimensions. We develop a new measure of ethnic heterogeneity that satisfies the basic properties associated with the concept of polarization. The empirical section shows that this index of ethnic polarization is a significant variable in the explanation of the incidence of civil wars. This result is robust to the presence of other indicators of ethnic heterogeneity, other sources of data for the construction of the index, and other data structures.

Welfare spending and ethnic heterogeneity. Evidence from a massive immigration wave

[spa] En este trabajo se analiza la relación entre la heterogeneidad étnica y la redistribución, utilizando la reciente y masiva llegada de inmigrantes a España. En concreto, se estudia el efecto de los cambios en la densidad de inmigrantes, observada entre 1998 y 2006, sobre los cambios en el gasto social municipal. La densidad de inmigrantes se instrumenta utilizando los patrones de establecimiento por país de origen para asignar los flujos predichos de inmigrantes a cada municipio. Los resultados evidencian que el gasto social incrementó menos en los municipios con mayores incrementos en la densidad de inmigrantes. También se proporciona evidencia de la existencia de una relación positiva entre la densidad de inmigrantes y el porcentaje de voto obtenidos por los partidos de derecha. Por tanto, estos resultados son consistentes con las teorías que predicen una relación negativa entre la heterogeneidad étnica y la redistribución.

Welfare spending and ethnic heterogeneity. Evidence from a massive immigration wave

[spa] En este trabajo se analiza la relación entre la heterogeneidad étnica y la redistribución, utilizando la reciente y masiva llegada de inmigrantes a España. En concreto, se estudia el efecto de los cambios en la densidad de inmigrantes, observada entre 1998 y 2006, sobre los cambios en el gasto social municipal. La densidad de inmigrantes se instrumenta utilizando los patrones de establecimiento por país de origen para asignar los flujos predichos de inmigrantes a cada municipio. Los resultados evidencian que el gasto social incrementó menos en los municipios con mayores incrementos en la densidad de inmigrantes. También se proporciona evidencia de la existencia de una relación positiva entre la densidad de inmigrantes y el porcentaje de voto obtenidos por los partidos de derecha. Por tanto, estos resultados son consistentes con las teorías que predicen una relación negativa entre la heterogeneidad étnica y la redistribución.

Collaboration strategies and technological innovation: a contractual perspective of the relationship between firms and techonological centers

In this paper, a theoretical framework for analyzing the selection of governance structures for implementing collaboration agreements between firms and Technological Centers is presented and empirically discussed. This framework includes Transaction Costs and Property Rights’ theoretical assumptions, though complemented with several proposals coming from the Transactional Value Theory. This last theory is used for adding some dynamism in the governance structure selection. As empirical evidence of this theoretical explanation, we analyse four real experiences of collaboration between firms and one Technological Center. These experiences are aimed to represent the typology of relationships which Technological Centers usually face. Among others, a key interesting result is obtained: R&D collaboration activities do not need to always be organized through hierarchical solutions. In those cases where future expected benefits and/or reputation issues could play an important role, the traditional more static theories could not fully explain the selected governance structure for managing the R&D relationship. As a consequence, these results justify further research about the adequacy of the theoretical framework presented in this paper in other contexts, for example, R&D collaborations between firms and/or between Universities or Public Research Centers and firms.

Inequality in CO2 emissions across countries and its relationship with income inequality: a distributive approach

This paper analyses the inequality in CO2 emissions across countries (and groups of countries) and the relationship of this inequality with income inequality across countries for the period (1971-1999). The research employs the tools that are usually applied in income distribution analysis. The methodology used here gives qualitative and quantitative information on some of the features of the inequalities across countries that are considered most relevant for the design and discussion of policies aimed at mitigating climate change. The paper studies the relationship between CO2 emissions and GDP and shows that income inequality across countries has been followed by an important inequality in the distribution of emissions. This inequality has diminished mildly, although the inequality in emissions across countries ordered in the increasing value of income (inequality between rich and poor countries) has diminished less than the “simple” inequality in emissions. Lastly, the paper shows that the inequality in CO2 emissions is mostly explained by the inequality between groups with different per capita income level. The importance of the inequality within groups of similar per capita income is much lower and has diminished during the period, especially in the low-middle income group.

The Effect of relationship lending on firm performance

We examine how relationship lending affects firm performance using a panel dataset of about 70,000 small and medium Spanish firms in the period 1993-2004. We model firm performance jointly with the firm's choice of the number of bank relationships. Controlling for firm fixed effects and using instrumental variables for the decision on the number of bank relationships, we find that firms maintaining exclusive bank relationships have lower profitability. The result is consistent with the view that banks appropriate most of the value generated through close relationships with its borrowers as long as they do not face competition from other lenders.

A Model of ethnic conflict

We present a model of conflict, in which discriminatory government policy or social intolerance is responsive to various forms of ethnic activism, including violence. It is this perceived responsiveness -captured by the probability that the government gives in and accepts a proponed change in ethnic policy- that induces individuals to mobilize in support for their cause. Yet, mobilization is costly and demonstrators have to be compensated accordingly. Individuals have to weigh their ethnic radicalism with their material well-being to determine the size of their money contribution to the cause. Our main results are: (i) a one-sided increase in radicalism or in population size increases conflict; (ii) a one-sided increase in income has ambiguous effects depending on the elasticity of contributions to income; (iii) an increase in within-group inequality increases conflict; and (iv) an increase in the correlation between ethnic radicalism and inequality also increases conflict.

The causal relationship between Individual’s choice behavior and self-reported satisfaction: the case of residential mobility in the EU

One of the most persistent and lasting debates in economic research refers to whether the answers to subjective questions can be used to explain individuals’ economic behavior. Using panel data for twelve EU countries, in the present study we analyze the causal relationship between self-reported housing satisfaction and residential mobility. Our results indicate that: i) households unsatisfied with their current housing situation are more likely to move; ii) housing satisfaction raises after a move, and; iii) housing satisfaction increases with the transition from being a renter to becoming a homeowner. Some interesting cross-country differences are observed. Our findings provide evidence in favor of use of subjective indicators of satisfaction with certain life domains in the analysis of individuals’ economic conduct.

Does Internationalization Alter the R&D-Productivity Relationship?

R&D investment is an important driver of productivity gains. However, firms differ in their ability to appropiate the returns to their R&D efforts. This paper analyses to what extent firm's internationalization influences the endogenous relation between R&D and productivity. In particular, we assess the contribution of R&D to productivity for a panel of UK firms that differ in their degree of internationalization. We find that, on average, multinationals obtain higher gains from their investment in R&D. However, the influence of internationalization on the contribution of R&D to productivity varies along the distribution of the returns to R&D. Keywords: R&D, Multinationals, Productivity. JEL Codes: C14, D24, F23.

Relationship between technological progress, capital elasticity and emissions of industrial pollutants for the production sectors in Catalonia

As is known, the Kyoto Protocol proposes to reinforce national policies for emission reduction and, furthermore, to cooperate with other contracting parties. In this context, it would be necessary to assess these emissions, both in general and specifically, by pollutants and/or among productive sectors. The object of this paper is precisely to estimate the polluting emissions of industrial origin in Catalonia in the year 2001, in a multivariate context which explicitly allows a distinction to be made between the polluter and/or the productive sector causing this emission. Six pollutants considered, four directly related to greenhouse effect. A multi-level model, with two levels, pollutants and productive sectors, was specified. Both technological progress and elasticity of capital were introduced as random effects. Hence, it has been permitted that these coefficients vary according to one or other level. The most important finding in this paper is that elasticity of capital has been estimated as very non-elastic, with a range which varies between 0.162 (the paper industry) and 0.556 (commerce). In fact, and generally speaking, the greater capital the sector has, the less elasticity of capital has been estimated. Key words: Kyoto protocol, multilevel model, technological progress

Which firms want PhDs? The effect of the university-industry relationship on the PhD labour market

PhD graduates hold the highest education degree, are trained to conduct research and can be considered a key element in the creation, commercialization and diffusion of innovations. The impact of PhDs on innovation and economic development takes place through several channels such as the accumulation of scientific capital stock, the enhancement of technology transfers and the promotion of cooperation relationships in innovation processes. Although the placement of PhDs in industry provides a very important mechanism for transmitting knowledge from universities to firms, information about the characteristics of the firms that employ PhDs is very scarce. The goal of this paper is to improve understanding of the determinants of the demand for PhDs in the private sector. Three main potential determinants of the demand for PhDs are considered: cooperation between firms and universities, R&D activities of firms and several characteristics of firms, size, sector, productivity and age. The results from the econometric analysis show that cooperation between firms and universities encourages firms to recruit PhDs and point to the existence of accumulative effects in the hiring of PhD graduates.

Ethnic and religious polarization and social conflict

In this paper we examine the link between ethnic and religious polarization and conflict using interpersonal distances for ethnic and religious attitudes obtained from the World Values Survey. We use the Duclos et al (2004) polarization index. We measure conflict by means on an index of social unrest, as well as by the standard conflict onset or incidence based on a threshold number of deaths. Our results show that taking distances into account significantly improves the quality of the fit. Our measure of polarization outperforms the measure used by Montalvo and Reynal-Querol (2005) and the fractionalization index. We also obtain that both ethnic and religious polarization are significant in explaining conflict. The results improve when we use an indicator of social unrest as the dependent variable.

How The 1996 Hotel Majestic agreement may explain a future PP/CiU relationship in Madrid

Some historians have argued that 1996 marked a ‘second transition’ for Spain because of the return to power of the political right in Madrid and that the relationship and eventual pact between the Partido Popular (PP) and Convergència i Unió (CiU) meant that the state could finally escape the ghosts of its Francoist past. For this research, face-to-face interviews were conducted with Catalan Members of Parliament who served under either José María Aznar or Jordi Pujol in Madrid or Barcelona. Drawing upon both interviews and other evidence, including the analysis of election results and the 1996 Hotel Majestic Agreement, the research seeks to provide a better understanding of the previous relationships between the PP and CiU and their leaders in order to understand what lessons might be learnt that would contribute to anticipating and explaining possible future negotiations between the two parties. This is attempted by first examining the potential costs and benefits of political pacts between centre (Madrid) and periphery (Barcelona). Secondly, due to many interviewees making reference to Salvador Espriu’s work La Pell de Brau, the three routes of Espriu’s Catalan nationalism are put into the context of the political pacts. Finally, the likelihood of future agreements between PP and CiU are hypothesized, not only how those agreements may (or may not) come about, but also, what might the result of those negotiations be. Ultimately, it is concluded that the benefits of the Hotel Majestic Agreement outweighed the costs, thus leaving the door open for future negotiations, even if some of those interviewed disagreed.