IPH response to European Review of the Social Determinants of Health and the Health Divide

IPH welcomes this European Review conducted by the Marmot Review Team which aims to inform action on social determinants of health and health equity within the forthcoming health policy for the European region, Health 2020. IPH calls for clear mandates supporting whole-of-government approaches to address social determinants and outlines some of the specific challenges and opportunities within the current Ireland and Northern Ireland policy landscape.

The Effects of government spending on the distribution of consumption

We study the effects of government spending on the distribution of consumption. We find a substantial degree of heterogeneity: consumption increases at the bottom and falls at the top of the distribution, implying a significant temporary reduction of consumption inequality. The effects of the shock display correlations of around -0.7/-0.9 with the percentage of stockholders within the decile. We interpret the results as in line and yielding support to models of limited participation where, while the Ricardian equivalence holds for rich households, for poor household, with no access to capital markets, the Keynesian multiplier is at work.

Fiscal foresight, forecast revisions and the effects of government spending in the open economy

This paper investigates the effects of government spending on the real exchange rate and the trade balance in the US using a new VAR identification procedure based on spending forecast revisions. I find that the real exchange rate appreciates and the trade balance deteriorates after a government spending shock, although the effects are quantitatively small. The findings broadly match the theoretical predictions of the standard Mundell-Fleming model and differ substantially from those existing in literature. Differences are attributable to the fact that, because of fiscal foresight, the government spending is non-fundamental for the variables typically used in open economy VARs. Here, on the contrary, the estimated shock is fundamental.

Continuity of Government Planning Interim Study Committee, March 2007

The Legislative Council established the Continuity of Government Planning Interim Study Committee in 2006 and authorized the Committee to meet during the 2006 Legislative Interim. The Committee was given the following charge: Examine issues relating to the continued functioning of state government following a disaster, including gubernatorial succession, replacement of constitutional officers and department heads, legislative elections to fill vacancies, and continued funding of state government if the General Assembly is unable to meet and pass a budget.

Does direct democracy reduce the size of government? New evidence from historical data, 1890-2000

Using historical data for all Swiss cantons from 1890 to 2000, we estimate the causal effect of direct democracy on government spending. The main innovation in this paper is that we use fixed effects to control for unobserved heterogeneity and instrumental variables to address the potential endogeneity of institutions. We find that the budget referendum and lower costs to launch a voter initiative are effective tools in reducing canton level spending. However, we find no evidence that the budget referendum results in more decentralized government or a larger local government. Our instrumental variable estimates suggest that a mandatory budget referendum reduces the size of canton spending between 13 and 19 percent. A 1 percent lower signature requirement for the initiative reduces canton spending by up to 2 percent.

Forest fires: Evaluation of government intervention measures

The purpose of this paper is to examine the relation between government measures, volunteer participation, climate variables and forest fires. A number of studies have related forest fires to causes of ignition, to fire history in one area, to the type of vegetation and weathercharacteristics or to community institutions, but there is little research on the relation between fire production and government prevention and extinction measures from a policy evaluation perspective.An observational approach is first applied to select forest fires in the north east of Spain. Taking a selection of fires with a certain size, a multiple regression analysis is conducted to find significant relations between policy instruments under the control of the government and the number of hectares burn in each case, controlling at the same time the effect of weather conditions and other context variables. The paper brings evidence on the effects of simultaneity and the relevance of recurring to army soldiers in specific days with extraordinary high simultaneity. The analysis also brings light on the effectiveness of twopreventive policies and of helicopters for extinction tasks.

Understanding the effects of government spending on consumption

Recent evidence suggests that consumption rises in response to an increase in government spending. That finding cannot be easily reconciled with existing optimizing business cycle models. We extend the standard new Keynesian model to allow for the presence of rule-of-thumb consumers. We show how the interaction of the latter with sticky prices and deficit financing can account for the existing evidence on the effects of government spending.

Shrouded costs of government: The political economy of state and local public pensions

Why do public-sector workers receive so much of their compensation in the formof pensions and other benefits? This paper presents a political economy model inwhich politicians compete for taxpayers' and government employees' votes by promising compensation packages, but some voters cannot evaluate every aspect of promisedcompensation. If pension packages are "shrouded", so that public-sector workers better understand their value than ordinary taxpayers, then compensation will be highlyback-loaded. In equilibrium, the welfare of public-sector workers could be improved,holding total public-sector costs constant, if they received higher wages and lowerpensions. Centralizing pension determination has two offsetting effects on generosity:more state-level media attention helps taxpayers better understand pension costs, andthat reduces pension generosity; but a larger share of public-sector workers will votewithin the jurisdiction, which increases pension generosity. A short discussion of pensions in two decentralized states (California and Pennsylvania) and two centralizedstates (Massachusetts and Ohio) suggests that centralization appears to have modestlyreduced pensions, but, as the model suggests, this is unlikely to be universal.

The influence of the quality of government institutions on entrepreneurial motivation: exploring the variance across countries

Despite the increasing understanding of the relationships between institutions and entrepreneurship, the influence of the quality of government institutions on entrepreneurship is less addressed. This paper focuses on this critical determinant of entrepreneurship in developing and developed countries. Drawing from institutional theory we hypothesize and empirically assess the role of the quality of institutions in entrepreneurial activity. We examine how the quality of government institutions influences the rate of necessity-based entrepreneurial activity across countries and over time by using a cross-sectional time-series approach on data from the Global Entrepreneurship Monitor (GEM) database covering the years 2001–2011. Our results suggest that higher economic development associated with better quality of institutions reduces the prevalence of necessity-based entrepreneurship. Our findings imply that developing countries must rationally organize their functions, and seek to remove unnecessary barriers, decrease political instability, and controls that hamper entrepreneurial activity

Effects of Government Ownership on Firm Performance: Evidence from Finnish Companies

Tutkimuksen tarkoituksena on selvittää, miten valtionomistajuus vaikuttaa yrityksen suorituskykyyn suomalaisissa pörssinoteeratuissa valtionyhtiöissä, joissa valtio toimii pää- tai osaomistajana. Suorituskykyä tutkitaan kandella eri menetelmällä. Ensin tutkitaan osaketuottoja Jensenin alfan avulla, jonka jälkeen suoritetaan tilinpäätöstunnuslukujen toimialavertailu. Tutkimuksen teoriaosuudessa esitetään yksityistämisen tuottamia etuja yrityksen taloudelliseen suorituskykyyn, sekä myöskin valtionomistajuuden tuottamia etuja. Lisäksi teoriaosuudessa käsitellään aikaisempien empiiristen tutkimusten tuloksia valtionomistajuuden vaikutuksista. Tämän tutkimuksen empiirisessä osiossa käytettävä data on saatu osakedatan osalta Datastreamista ja tilinpäätöstunnuslukujen osalta Balance Consulting Oy:ltä. Kokonaisosakedataa koskeva tutkimus Jensenin alfalla ei osoittanut valtionyhtiöiden toimivan tehottomasti, vaan osoitti yritysten kyenneen tuottamaan epänormaaleja tuottoja riskitasoonsa nähden. Vuositasolle pilkotun datan analysointi sen sijaan tuotti useita negatiivisia alfoja yrityksille eli merkkejä tehottomuudesta tiettyinä vuosina. Lisäksi tilinpäätöstunnuslukujen analysointi osoitti osan valtionyhtiöistä olleen pääosin omaa toimialaansa tehottomampia, kun taas osa kykenipäihittämään toimialansa.

Still the century of government savings banks? The Caixa Econômica Federal

This article explores general concerns about government banking, social inclusion, and democracy through case study of the Brazilian federal government savings bank (Caixa Econômica Federal). Review of government savings banks in Brazilian history suggests that these institutions have been at the center of domestic political economy, expanding and contracting under a variety of political regimes and economic conditions. Since capitalization to meet central bank and Basel Accord guidelines in 2001, the Caixa has attempted to modernize, continue to serve as agent for government policies, and expand both popular credit and savings and investment banking activities.

Forecasting the Yield Curve of Government Bonds: A Comparative Study

For the past 20 years, researchers have applied the Kalman filter to the modeling and forecasting the term structure of interest rates. Despite its impressive performance in in-sample fitting yield curves, little research has focused on the out-of-sample forecast of yield curves using the Kalman filter. The goal of this thesis is to develop a unified dynamic model based on Diebold and Li (2006) and Nelson and Siegel’s (1987) three-factor model, and estimate this dynamic model using the Kalman filter. We compare both in-sample and out-of-sample performance of our dynamic methods with various other models in the literature. We find that our dynamic model dominates existing models in medium- and long-horizon yield curve predictions. However, the dynamic model should be used with caution when forecasting short maturity yields

Gala Performance on the occasion of the Commonwealth Heads of Government Meeting Programme

The programme from the Gala Performance on the occasion of the Commonwealth Heads of Government meeting, 7 August 1973. The event took place in the Opera of the National Arts Centre in Ottawa.

The Backing of Government Debt and the Price Level

This paper studies the interdependence between fiscal and monetary policies, and their joint role in the determination of the price level. The government is characterized by a long-run fiscal policy rule whereby a given fraction of the outstanding debt, say d, is backed by the present discounted value of current and future primary surpluses. The remaining debt is backed by seigniorage revenue. The parameter d characterizes the interdependence between fiscal and monetary authorities. It is shown that in a standard monetary economy, this policy rule implies that the price level depends not only on the money stock, but also on the proportion of debt that is backed with money. Empirical estimates of d are obtained for OECD countries using data on nominal consumption, monetary base, and debt. Results indicate that debt plays only a minor role in the determination of the price level in these economies. Estimates of d correlate well with institutional measures of central bank independence.