Three Essays on the Formation and Impact of Economic Policy

Introduction In my thesis I argue that economic policy is all about economics and politics. Consequently, analysing and understanding economic policy ideally has at least two parts. The economics part, which is centered around the expected impact of a specific policy on the real economy both in terms of efficiency and equity. The insights of this part point into which direction the fine-tuning of economic policies should go. However, fine-tuning of economic policies will be most likely subject to political constraints. That is why, in the politics part, a much better understanding can be gained by taking into account how the incentives of politicians and special interest groups as well as the role played by different institutional features affect the formation of economic policies. The first part and chapter of my thesis concentrates on the efficiency-related impact of economic policies: how does corporate income taxation in general, and corporate income tax progressivity in specific, affect the creation of new firms? Reduced progressivity and flat-rate taxes are in vogue. By 2009, 22 countries are operating flat-rate income tax systems, as do 7 US states and 14 Swiss cantons (for corporate income only). Tax reform proposals in the spirit of the "flat tax" model typically aim to reduce three parameters: the average tax burden, the progressivity of the tax schedule, and the complexity of the tax code. In joint work, Marius Brülhart and I explore the implications of changes in these three parameters on entrepreneurial activity, measured by counts of firm births in a panel of Swiss municipalities. Our results show that lower average tax rates and reduced complexity of the tax code promote firm births. Controlling for these effects, reduced progressivity inhibits firm births. Our reading of these results is that tax progressivity has an insurance effect that facilitates entrepreneurial risk taking. The positive effects of lower tax levels and reduced complexity are estimated to be significantly stronger than the negative effect of reduced progressivity. To the extent that firm births reflect desirable entrepreneurial dynamism, it is not the flattening of tax schedules that is key to successful tax reforms, but the lowering of average tax burdens and the simplification of tax codes. Flatness per se is of secondary importance and even appears to be detrimental to firm births. The second part of my thesis, which corresponds to the second and third chapter, concentrates on how economic policies are formed. By the nature of the analysis, these two chapters draw on a broader literature than the first chapter. Both economists and political scientists have done extensive research on how economic policies are formed. Thereby, researchers in both disciplines have recognised the importance of special interest groups trying to influence policy-making through various channels. In general, economists base their analysis on a formal and microeconomically founded approach, while abstracting from institutional details. In contrast, political scientists' frameworks are generally richer in terms of institutional features but lack the theoretical rigour of economists' approaches. I start from the economist's point of view. However, I try to borrow as much as possible from the findings of political science to gain a better understanding of how economic policies are formed in reality. In the second chapter, I take a theoretical approach and focus on the institutional policy framework to explore how interactions between different political institutions affect the outcome of trade policy in presence of special interest groups' lobbying. Standard political economy theory treats the government as a single institutional actor which sets tariffs by trading off social welfare against contributions from special interest groups seeking industry-specific protection from imports. However, these models lack important (institutional) features of reality. That is why, in my model, I split up the government into a legislative and executive branch which can both be lobbied by special interest groups. Furthermore, the legislative has the option to delegate its trade policy authority to the executive. I allow the executive to compensate the legislative in exchange for delegation. Despite ample anecdotal evidence, bargaining over delegation of trade policy authority has not yet been formally modelled in the literature. I show that delegation has an impact on policy formation in that it leads to lower equilibrium tariffs compared to a standard model without delegation. I also show that delegation will only take place if the lobby is not strong enough to prevent it. Furthermore, the option to delegate increases the bargaining power of the legislative at the expense of the lobbies. Therefore, the findings of this model can shed a light on why the U.S. Congress often practices delegation to the executive. In the final chapter of my thesis, my coauthor, Antonio Fidalgo, and I take a narrower approach and focus on the individual politician level of policy-making to explore how connections to private firms and networks within parliament affect individual politicians' decision-making. Theories in the spirit of the model of the second chapter show how campaign contributions from lobbies to politicians can influence economic policies. There exists an abundant empirical literature that analyses ties between firms and politicians based on campaign contributions. However, the evidence on the impact of campaign contributions is mixed, at best. In our paper, we analyse an alternative channel of influence in the shape of personal connections between politicians and firms through board membership. We identify a direct effect of board membership on individual politicians' voting behaviour and an indirect leverage effect when politicians with board connections influence non-connected peers. We assess the importance of these two effects using a vote in the Swiss parliament on a government bailout of the national airline, Swissair, in 2001, which serves as a natural experiment. We find that both the direct effect of connections to firms and the indirect leverage effect had a strong and positive impact on the probability that a politician supported the government bailout.

Optic perineuritis secondary to Wegener's granulomatosis.

BACKGROUND: Optic perineuritis (OPN) is an inflammatory condition involving the optic nerve sheath because of a variety of causes. We describe three patients in whom OPN was secondary to Wegener's granulomatosis (WG) and compare the clinical findings in these cases with those of idiopathic OPN. METHODS: This is a retrospective small case series derived from patients with OPN seen in an outpatient neuro-ophthalmology clinic. Medical records and imaging studies of these patients were reviewed. RESULTS: These patients shared clinical similarities with idiopathic OPN including age, sex, symptoms, radiographic findings and steroid responsiveness. However, recurrence of symptoms on lowering the prednisone dose below 40 mg distinguished these patients from those with idiopathic OPN. CONCLUSIONS: Steroid dependency in idiopathic OPN should raise suspicion of WG. Patients with OPN should be specifically questioned regarding pre-existing upper respiratory tract disorders and rheumatic symptoms and laboratory testing should include acute phase reactants, anti-neutrophil cytoplasmic antibodies and tests of renal function.

Pathological science.

Review of the book : The undergrowth of science: delusion, self-deception and human frailty, by W. Gratzer, Oxford University Press, Oxford, UK

On the use of IRMS in forensic science: proposals for a methodological approach.

The flourishing number of publications on the use of isotope ratio mass spectrometry (IRMS) in forensicscience denotes the enthusiasm and the attraction generated by this technology. IRMS has demonstratedits potential to distinguish chemically identical compounds coming from different sources. Despite thenumerous applications of IRMS to a wide range of forensic materials, its implementation in a forensicframework is less straightforward than it appears. In addition, each laboratory has developed its ownstrategy of analysis on calibration, sequence design, standards utilisation and data treatment without aclear consensus.Through the experience acquired from research undertaken in different forensic fields, we propose amethodological framework of the whole process using IRMS methods. We emphasize the importance ofconsidering isotopic results as part of a whole approach, when applying this technology to a particularforensic issue. The process is divided into six different steps, which should be considered for a thoughtfuland relevant application. The dissection of this process into fundamental steps, further detailed, enablesa better understanding of the essential, though not exhaustive, factors that have to be considered in orderto obtain results of quality and sufficiently robust to proceed to retrospective analyses or interlaboratorycomparisons.

Une pensée économique russe?: présentation, traduction et annotation de l'article "Science Economique" (1899) de Mikhail Ivanovich Tugan-Baranovskij

L'économiste russe Tugan-Baranovskij (1865-1919) a publié en 1899 une notice sur le développement de la « science économique russe » pour la première encyclopédie universelle russe, le Brockhaus-Efron. Sous la forme d'un catalogue chronologique des économistes russes et de leurs ouvrages tout au long du XIXe siècle, le récit de Tugan-Baranovskij représente une des premières tentatives d'écrire une histoire de la pensée économique russe. L'intérêt du texte se manifeste lorsqu'on s'interroge sur l'existence d'une telle science « nationale » de l'économie politique. Nous présentons ici en traduction française ce récit jamais encore traduit du russe, et nous l'accompagnons de notes sur les auteurs et les ouvrages qui y sont signalés.

Value of allogeneic versus autologous stem cell transplantation and chemotherapy in patients with myelodysplastic syndromes and secondary acute myeloid leukemia. Final results of a prospective randomized European Intergroup Trial.

BACKGROUND: Allogeneic stem cell transplantation is usually considered the only curative treatment option for patients with advanced or transformed myelodysplastic syndromes in complete remission, but post-remission chemotherapy and autologous stem cell transplantation are potential alternatives, especially in patients over 45 years old. DESIGN AND METHODS: We evaluated, after intensive anti-leukemic remission-induction chemotherapy, the impact of the availability of an HLA-identical sibling donor on an intention-to treat basis. Additionally, all patients without a sibling donor in complete remission after the first consolidation course were randomized to either autologous peripheral blood stem cell transplantation or a second consolidation course consisting of high-dose cytarabine. RESULTS: The 4-year survival of the 341 evaluable patients was 28%. After achieving complete remission, the 4-year survival rates of patients under 55 years old with or without a donor were 54% and 41%, respectively, with an adjusted hazard ratio of 0.81 (95% confidence interval [95% CI], 0.49-1.35) for survival and of 0.67 (95% CI, 0.42-1.06) for disease-free survival. In patients with intermediate/high risk cytogenetic abnormalities the hazard ratio in multivariate analysis was 0.58 (99% CI, 0.22-1.50) (P=0.14) for survival and 0.46 (99% CI, 0.22-1.50) for disease-free survival (P=0.03). In contrast, in patients with low risk cytogenetic characteristics the hazard ratio for survival was 1.17 (99% CI, 0.40-3.42) and that for disease-free survival was 1.02 (99% CI, 0.40-2.56). The 4-year survival of the 65 patients randomized to autologous peripheral blood stem cell transplantation or a second consolidation course of high-dose cytarabine was 37% and 27%, respectively. The hazard ratio in multivariate analysis was 1.22 (95% CI, 0.65-2.27) for survival and 1.02 (95% CI, 0.56-1.85) for disease-free survival. CONCLUSIONS: Patients with a donor and candidates for allogeneic stem cell transplantation in first complete remission may have a better disease-free survival than those without a donor in case of myelodysplastic syndromes with intermediate/high-risk cytogenetics. Autologous peripheral blood stem cell transplantation does not provide longer survival than intensive chemotherapy.

Clinical benefits of an adherence monitoring program in the management of secondary hyperparathyroidism with cinacalcet: results of a prospective randomized controlled study.

BACKGROUND/AIMS: One of the causes of uncontrolled secondary hyperparathyroidism (sHPT) is patient's poor drug adherence. We evaluated the clinical benefits of an integrated care approach on the control of sHPT by cinacalcet. METHODS: Prospective, randomized, controlled, multicenter, open-label study. Fifty hemodialysis patients on a stable dose of cinacalcet were randomized to an integrated care approach (IC) or usual care approach (UC). In the IC group, cinacalcet adherence was monitored using an electronic system. Results were discussed with the patients in motivational interviews, and drug prescription adapted accordingly. In the UC group, drug adherence was monitored, but results were not available. RESULTS: At six months, 84% of patients in the IC group achieved recommended iPTH targets versus 55% in the UC group (P = 0.04). The mean cinacalcet taking adherence improved by 10.8% in the IC group and declined by 5.3% in the UC group (P = 0.02). Concomitantly, the mean dose of cinacalcet was reduced by 7.2 mg/day in the IC group and increased by 6.4 mg/day in the UC group (P = 0.03). CONCLUSIONS: The use of a drug adherence monitoring program in the management of sHPT in hemodialysis patients receiving cinacalcet improves drug adherence and iPTH control and allows a reduction in the dose of cinacalcet.