Spinning welfare: The gains from process innovation in cotton and car production

Economists and economic historians want to know how much better life is today than in the past.Fifty years ago economic historians found surprisingly small gains from 19th century US railroads,while more recently economists have found relatively large gains from electricity, computers and cellphones. In each case the implicit or explicit assumption is that researchers were measuring the valueof a new good to society. In this paper we use the same techniques to find the value to society ofmaking existing goods cheaper. Henry Ford did not invent the car, and the inventors of mechanisedcotton spinning in the industrial revolution invented no new product. But both made existing productsdramatically cheaper, bringing them into the reach of many more consumers. That in turn haspotentially large welfare effects. We find that the consumer surplus of Henry Ford s production linewas around 2% by 1923, 15 years after Ford began to implement the moving assembly line, while themechanisation of cotton spinning was worth around 6% by 1820, 34 years after its initial invention.Both are large: of the same order of magnitude as consumer expenditure on these items, and as largeor larger than the value of the internet to consumers. On the social savings measure traditionally usedby economic historians, these process innovations were worth 15% and 18% respectively, makingthem more important than railroads. Our results remind us that process innovations can be at least asimportant for welfare and productivity as the invention of new products.

Globalization and wage inequality in South and East Asia, and Latin America: A gender approach

In this paper we analyse the reasons behind the evolution of the gender gap and wage inequality in South and East Asian and Latin American countries. Health human capital improvements, the exposure to free market openness and equal treatment enforcement laws seem to be the main exogenous variables affecting women s economic condition. During the second globalization era (in the years 1975-2000) different combinations of these variables in South East Asian and Latin American countries have had as a result the diminution of the gender gap. The main exception to this rule according to our data is China where economic reforms have been simultaneous to the increase of gender differences and inequality between men and women.This result has further normative consequences for the measure of economic inequality. Theimprovement of women s condition has as a result the diminution of the dispersion of wages.Therefore in most of the countries analysed the consequence of the diminution of the gender gapduring the second global era is the decrease of wage inequality both measured with Gini and Theil indexes.

Social security in theory and practice (II): Efficiency theories, narrative theories and implications for reform

166 countries have some kind of public old age pension. What economic forcescreate and sustain old age Social Security as a public program? Mulligan and Sala-i-Martin (1999b) document several of the internationally and historically common features of social security programs, and explore "political" theories of Social Security. This paper discusses the "efficiency theories", which view creation of the SS program as a full of partial solution to some market failure. Efficiency explanations of social security include the "SS as welfare for the elderly" the "retirement increases productivity to optimally manage human capital externalities", "optimal retirement insurance", the "prodigal father problem", the "misguided Keynesian", the "optimal longevity insurance", the "governmenteconomizing transaction costs", and the "return on human capital investment". We also analyze four "narrative" theories of social security: the "chain letter theory", the "lump of labor theory", the "monopoly capitalism theory", and the "Sub-but-Nearly-Optimal policy response to private pensions theory".The political and efficiency explanations are compared with the international and historical facts and used to derive implications for replacing the typical pay-as-you-go system with a forced savings plan. Most of the explanations suggest that forced savings does not increase welfare, and may decrease it.

Credit cycles in theory and experiment

We test in the laboratory the potential of evolutionary dynamics as predictor of actual behavior. To this end, we propose an asymmetricgame -which we interpret as a borrowerlender relation-, study itsevolutionary dynamics in a random matching set-up, and tests itspredictions. The model provides conditions for the existence ofcredit markets and credit cycles. The theoretical predictions seemto be good approximations of the experimental results.

Comment to "Weak instruments robust tests in GMM and the New Keynesian Phillips curve" by Frank Kleibergen and Sophocles Mavroeidis

I discuss the identifiability of a structural New Keynesian Phillips curve when it is embedded in a small scale dynamic stochastic general equilibrium model. Identification problems emerge because not all the structural parameters are recoverable from the semi-structural ones and because the objective functions I consider are poorly behaved. The solution and the moment mappings are responsible for the problems.

Social security in theory and practice (I): Facts and political theories

166 countries have some kind of public old age pension. What economic forcescreate and sustain old age Social Security as a public program? We document some of the internationally and historically common features of Social Security programs including explicit and implicit taxes on labor supply, pay-as-you-go features, intergenerational redistribution, benefits which areincreasing functions of lifetime earnings and not means-tested. We partition theories of Social Security into three groups: "political", "efficiency" and "narrative" theories. We explore three political theories in this paper: the majority rational voting model (with its two versions: "the elderly as the leaders of a winning coalition with the poor" and the "once and for all election" model), the "time-intensive model of political competition" and the "taxpayer protection model". Each of the explanations is compared with the international and historical facts. A companion paper explores the "efficiency" and "narrative" theories, and derives implicationsof all the theories for replacing the typical pay-as-you-go system with a forced savings plan.

Fixed and random effects in Classical and Bayesian regression

This paper proposes a common and tractable framework for analyzingdifferent definitions of fixed and random effects in a contant-slopevariable-intercept model. It is shown that, regardless of whethereffects (i) are treated as parameters or as an error term, (ii) areestimated in different stages of a hierarchical model, or whether (iii)correlation between effects and regressors is allowed, when the sameinformation on effects is introduced into all estimation methods, theresulting slope estimator is also the same across methods. If differentmethods produce different results, it is ultimately because differentinformation is being used for each methods.

Polypes et cancers colo-rectaux par sous-localisation: données épidémiologiques genevoises et vaudoises [Colorectal polyps and cancers by sub-site: epidemiologic findings in Geneva and Vaud].

The present study is a comparative analysis of the adenomatous polyps and colorectal cancers, registered during a determined period within the population of the cantons of Geneva and Vaud. The analysis is particularly based on the polyp/cancer ratio by sub-site. Histological type as well as age and sex of the patient are taken into consideration.

Declining labor force attachment and downward trends in unemployment and participation

The US labor market witnessed two apparently unrelated secular movements in thelast 30 years: a decline in unemployment between the early 1980s and the early 2000s,and a decline in participation since the early 2000s. Using CPS micro data and a stock-flow accounting framework, we show that a substantial, and hitherto unnoticed, factorbehind both trends is a decline in the share of nonparticipants who are at the margin ofparticipation. A lower share of marginal nonparticipants implies a lower unemploymentrate, because marginal nonparticipants enter the labor force mostly through unemployment,while other nonparticipants enter the labor force mostly through employment.

Genome-wide association analysis of blood-pressure traits in African-ancestry individuals reveals common associated genes in African and non-African populations.

High blood pressure (BP) is more prevalent and contributes to more severe manifestations of cardiovascular disease (CVD) in African Americans than in any other United States ethnic group. Several small African-ancestry (AA) BP genome-wide association studies (GWASs) have been published, but their findings have failed to replicate to date. We report on a large AA BP GWAS meta-analysis that includes 29,378 individuals from 19 discovery cohorts and subsequent replication in additional samples of AA (n = 10,386), European ancestry (EA) (n = 69,395), and East Asian ancestry (n = 19,601). Five loci (EVX1-HOXA, ULK4, RSPO3, PLEKHG1, and SOX6) reached genome-wide significance (p < 1.0 × 10(-8)) for either systolic or diastolic BP in a transethnic meta-analysis after correction for multiple testing. Three of these BP loci (EVX1-HOXA, RSPO3, and PLEKHG1) lack previous associations with BP. We also identified one independent signal in a known BP locus (SOX6) and provide evidence for fine mapping in four additional validated BP loci. We also demonstrate that validated EA BP GWAS loci, considered jointly, show significant effects in AA samples. Consequently, these findings suggest that BP loci might have universal effects across studied populations, demonstrating that multiethnic samples are an essential component in identifying, fine mapping, and understanding their trait variability.

Nutrition in cardiovascular disease: salt in hypertension and heart failure.

There is much evidence for a causal relationship between salt intake and blood pressure (BP). The current salt intake in many countries is between 9 and 12 g/day. A reduction in salt intake to the recommended level of 5-6 g/day lowers BP in both hypertensive and normotensive individuals. A further reduction to 3-4 g/day has a much greater effect. Prospective studies and outcome trials have demonstrated that a lower salt intake is associated with a decreased risk of cardiovascular disease. Increasing evidence also suggests that a high salt intake is directly related to left ventricular hypertrophy (LVH) independent of BP. Both raised BP and LVH are important risk factors for heart failure. It is therefore possible that a lower salt intake could prevent the development of heart failure. In patients who already have heart failure, a high salt intake aggravates the retention of salt and water, thereby exacerbating heart failure symptoms and progression of the disease. A lower salt intake plays an important role in the management of heart failure. Despite this, currently there is no clear evidence on how far salt intake should be reduced in heart failure. Our personal view is that these patients should reduce their salt intake to <5 g/day, i.e. the maximum intake recommended by the World Health Organisation for all adults. If salt intake is successfully reduced, there may well be a need for a reduction in diuretic dosage.

Increased body fat is independently and negatively related with cardiorespiratory fitness levels in children and adolescents with normal weight.

Body mass index (BMI) is related with cardiorespiratory fitness (CRF), but less is known regarding the combined relationships between BMI and body fat (BF) on CRF. Cross-sectional study included 2361 girls and 2328 boys aged 10–18 years living in the area of Lisbon, Portugal. BMI was calculated by measuring height and weight, and obesity was assessed by international criteria. BF was assessed by bioimpedance. CRF was assessed by the 20-m shuttle run and the participants were classified as normal-to-high or low-CRF level according to Fitness gram criterion-referenced standards. The prevalence of low CRF was 47 and 39% in girls and boys, respectively. The corresponding values for the prevalence of obesity were 4.8 and 5.6% (not significant) and of excess BF of 12.1 and 25.1% (P <0.001), respectively. In both sexes, BMI and BF were inversely related with CRF: r = – 0.53 and – 0.45 for BMI and % BF, respectively, in boys and the corresponding values in girls were – 0.50 and – 0.33 (all P <0.01). When compared with a participant with normal BMI and BF, the odds ratios (95% confidence interval) for low CRF were 1.94 (1.46–2.58) for a participant with normal BMI and high BF, and 6.19 (5.02–7.63) for a participant with high BMI and high BF. The prevalence of low-CRF levels is high in Portuguese youths. BF negatively influences CRF levels among children/adolescents with normal BMI.