Past and future of the bankruptcy law in Brazil and Latin America

This paper studies the Bankruptcy Law in Latin America, focusing on the Brazilian reform. We start with a review of the international literature and its evolution on this subject. Next, we examine the economic incentives associated with several aspects of bankruptcy laws and insolvency procedures in general, as well as the trade-offs involved. After this theoretical discussion, we evaluate empirically the current stage of the quality of insolvency procedures in Latin America using data from Doing Business and World Development Indicators, both from World Bank and International Financial Statistics from IMF. We find that the region is governed by an inefficient law, even when compared with regions of lower per capita income. As theoretical and econometric models predict, this inefficiency has severe consequences for credit markets and the cost of capital. Next, we focus on the recent Brazilian bankruptcy reform, analyzing its main changes and possible effects over the economic environment. The appendix describes difficulties of this process of reform in Brazil, and what other Latin American countries can possibly learn from it.

Human capital and innovation: evidence from panel cointegration tests

Panel cointegration techniques applied to pooled data for 27 economies for the period 1960-2000 indicate that: i) government spending in education and innovation indicators are cointegrated; ii) education hierarchy is relevant when explaining innovation; and iii) the relation between education and innovation can be obtained after an accommodation of a level structural break.

Income and bargaining effects on education and health

In this paper, we examine the impacts of the reform in the rural pension system in Brazil in 1991 on schooling and health indicators. In addition, we use the reform to investigate the validity of the unitary model of household allocation by testing if there were uneven impacts on those indicators depending on the gender of the recipient. The main conclusion of the paper is that the reform had significantly positive effects on the outcomes of interest, especially on those co-residing with a male pensioner, indicating that the unitary model is not a well-specified framework to understand family allocation decisions. The highest impacts were on school attendance for boys, literacy for girls and illness for middle-age people. We explore a collective model as defined by Chiappori (1992) as one possible alternative representation for the decision-making process of the poor rural Brazilian families. In the cooperative Nash equilibrium, the reform effects can be divided into two pieces: a direct income effect and bargaining power effect. The data support the existence of these two different effects

The missing link: using the NBER recession indicator to construct coincident and leading indices economic activity

We use the information content in the decisions of the NBER Business Cycle Dating Committee to construct coincident and leading indices of economic activity for the United States. We identify the coincident index by assuming that the coincident variables have a common cycle with the unobserved state of the economy, and that the NBER business cycle dates signify the turning points in the unobserved state. This model allows us to estimate our coincident index as a linear combination of the coincident series. We establish that our index performs better than other currently popular coincident indices of economic activity.

The missing link: using the NBER recession indicator to construct coincident and leading indices economic activity

We use the information content in the decisions of the NBER Business Cycle Dating Committee to construct coincident and leading indices of economic activity for the United States. We identify the coincident index by assuming that the coincident variables have a common cycle with the unobserved state of the economy, and that the NBER business cycle dates signify the turning points in the unobserved state. This model allows us to estimate our coincident index as a linear combination of the coincident series. We establish that our index performs better than other currently popular coincident indices of economic activity.

Constructing coincident and leading indices of economic activity for the brazilian economy

This paper has three original contributions. The first is the reconstruction effort of the series of employment and income to allow the creation of a new coincident index for the Brazilian economic activity. The second is the construction of a coincident index of the economic activity for Brazil, and from it, (re)establish a chronology of recessions in the recent past of the Brazilian economy. The coincident index follows the methodology proposed by TCB and it covers the period 1980:1 to 2007:11. The third is the construction and evaluation of many leading indicators of economic activity for Brazil which fills an important gap in the Brazilian Business Cycles literature.

The missing link: using the NBER recession indicator to construct coincident and leading indices economic activity

We use the information content in the decisions of the NBER Business Cycle Dating Committee to construct coincident and leading indices of economic activity for the United States. We identify the coincident index by assuming that the coincident variables have a common cycle with the unobserved state of the economy, and that the NBER business cycle dates signify the turning points in the unobserved state. This model allows us to estimate our coincident index as a linear combination of the coincident series. We compare the performance of our index with other currently popular coincident indices of economic activity.

Constructing coincident and leading indices of economic activity for the brazilian economy

This paper has three original contributions. The first is the reconstruction effort of the series of employment and income to allow the creation of a new coincident index for the Brazilian economic activity. The second is the construction of a coincident index of the economic activity for Brazil, and from it, (re) establish a chronology of recessions in the recent past of the Brazilian economy. The coincident index follows the methodology proposed by The Conference Board (TCB) and it covers the period 1980:1 to 2007:11. The third is the construction and evaluation of many leading indicators of economic activity for Brazil which fills an important gap in the Brazilian Business Cycles literature.

Constructing coincident and leading indices of economic activity for the Brazilian economy

This paper has three original contributions. The fi rst is the reconstruction effort of the series of employment and income to allow the creation of a new coincident index for the Brazilian economic activity. The second is the construction of a coincident index of the economic activity for Brazil, and from it, (re) establish a chronology of recessions in the recent past of the Brazilian economy. The coincident index follows the methodology proposed by The Conference Board (TCB) and it covers the period 1980:1 to 2007:11. The third is the construction and evaluation of many leading indicators of economic activity for Brazil which fills an important gap in the Brazilian Business-Cycle literature.

Monetary policy and the cross-section of stock returns: a FAVAR approach

We use a factor-augmented vector autoregression (FAVAR) to estimate the impact of monetary policy shocks on the cross-section of stock returns. Our FAVAR combines unobserved factors extracted from a large set of nancial and macroeconomic indicators with the Federal Funds rate. We nd that monetary policy shocks have heterogeneous e ects on the crosssection of stock returns. These e ects are very well explained by the degree of external nance dependence, as well as by other sectoral characteristics.

Wasted: understanding the economic and social impact of food waste

Over one-third of global food production goes to waste while over 850million people are fighting chronic hunger. The United States is the world’s largest food waster. One third of America’s food with an economic value of US$161 billion is wasted and less than 7% is recycled. American food waste ends up in landfills creating powerful methane gas emissions. South Korea, on the other hand, has implemented the world’s strictest food waste laws, and today diverts 93% of wasted food away from landfills turning such waste into powerful economic opportunities. This Master Thesis investigates the reasons behind global food waste by comparing South Korea and the US. It explores what these two nations are doing to address their respective food waste problems, South Korea successfully, the US not. The paper looks at the two countries’ respective policies and national characteristics, which impact decision-making and recycling processes. The effort concludes that South Korea has embarked on a necessary paradigm shift turning food waste into powerful economic drivers leading to a sharp decline in food waste. In the US, food waste continues to be a major problem without a national strategy to remedy waste. Any effort in the US, while laudable, is sporadic and local, and hence the US misses out on possibly important economic growth opportunities.

Sanitation and health: empirical evidence for Brazilian municipalities

The relationship between sanitation policies (access and quality) and health in Brazilian municipalities was estimated from 2003 to 2010 using a panel data model with corrections for missing data. The results suggest a limited effect of sanitation policy on health. Compared with results from the literature, we found that the worsening quality of water appears to be associated with increased rates of mortality and hospitalization for children up to one month of age. Improvements in sewage sanitation have reduced the mortality and morbidity rates in children aged one to four. Improved access to piped water is associated with decreased hospitalization related to dysentery and acute respiratory infections (ARI) and does not have an effect on child mortality. Finally, epidemiological transition is only supported by weak evidence, including a more intense effect of reduced access to sanitation in municipalities with the worst mortality and morbidity indicators. In most models, this theory has been rejected

The benefits and pitfalls of participating in a corporate inversion: a case study of two companies on two different paths

Even though the term corporate inversion has been heard globally for decades, it has only become more prevalent in the United States during the past two years. This case study examines two United States companies that recently had very high profile and public corporate inversion experiences. Complicated tax laws and high tax rales have long eroded the ability of United States companies to remain competitive on a global scale. During the past two years, tax reform has been elevated to the Presidential and Congressional levei. Because these reform efforts have stalled, however, and in the constant search for ways to become more competitive and profitable, United States dorniciled companies have begun to more aggressively explore corporate inversion. This case study of Walgreens Alliance Boots and Mylan N.V., is undertaken because while the reasons to pursue a corporate inversion for both companies were very similar and done during the same time period, the internai process and final outcome were dramatically different. The other dynamic studied is the role both internai and externai politics had on these two cornpanies and how they influenced the decisions made by the executives. Lastly, the Obama Administration continues to threaten so called "corporate America" to remain in the country through regulatory pressure, but this has not stopped companies frorn pursing corporate inversions. Legislatively, attempts at corporate tax reform, another way to encourage Untied States companies to remain, have also failed. I will not try to determine i f a corporate inversion is the right path for a company to take. I am examining how the rise o f the practice o f corporate inversions has been elevated in boardroorns, on Wall Street, in Congress and at the White House during the past two years.

Implications of innovation for inclusive growth: a study of Medellín, Colombia's metro system and integral urban projects

Medellín, Colombia continues to attract global recognition for its evolution from a crimesaturated and desegregated city to an award-winning paragon of innovation. Two innovations in particular, the Metro System & the Integral Urban Projects, have fostered and contributed to Medellín’s inclusive growth, as indicated by a corresponding increase in both social and economic capital. Through a mixed methodology analysis of these two experiences, including participant observation, in-depth interviews with different industry leaders, and household surveys, this thesis explores the extent to which inclusive innovation has contributed to inclusive growth in Medellín. The surveys were distributed to three sensitive neighborhoods of Medellín and apply a Synthesized Framework for measuring inclusive growth, one that includes five indicators for social capital and five indicators for economic capital, emphasizing the importance of progression in both dimensions. By drawing on concepts of inclusivity surfacing more frequently in business lexicon and the emergence of a newly branded Medellín, the findings of this thesis indicates that the implementation of innovations in association with a unified city vision practiced by the local government, corporate and non-profit sector has contributed to achieving inclusive growth, and has left civilians hungry for more.

Windows of opportunities and knowledge networks: implications for the catch-up in developing countries

This document represents a doctoral thesis held under the Brazilian School of Public and Business Administration of Getulio Vargas Foundation (EBAPE/FGV), developed through the elaboration of three articles. The research that resulted in the articles is within the scope of the project entitled “Windows of opportunities and knowledge networks: implications for catch-up in developing countries”, funded by Support Programme for Research and Academic Production of Faculty (ProPesquisa) of Brazilian School of Public and Business Administration (EBAPE) of Getulio Vargas Foundation.