Template-Type: ReDIF-Paper 1.0 Author-Name: Onur Koska Author-Name-First: Onur Author-Name-Last: Koska Author-Email: onur.koska@uni-tuebingen.de Author-Workplace-Name: Department of Economics, University of Tuebingen Title: A Model of Competition Between Multinational Firms Abstract: This study focuses on the theory of how multinational firms choose their entry modes between alternative options (i.e., trade, greenfield investment, or acquisition). In a comprehensive model of strategic decision-making with more than one multinational firm, it delineates how a multinational firm's entry mode influences a rival multinational firm's market entry behavior and how exogenous factors (e.g., market size, firms' production cost, per-unit trade cost and fixed investment cost) affect the optimal entry modes. The main finding of the study is that competition among multinational firms substantially affects their optimal entry modes such that competition implies different entry modes compared to no competition. Length: 39 pages Creation-Date: 2009-10 Revision-Date: 2009-10 File-URL: http://www.otago.ac.nz/economics/research/otago077126.pdf File-Format: Application/pdf File-Function: First version, 2009 Number: 0911 Classification-JEL: D21; F23; L13 Keywords: Market Entry; Foreign Direct Investment; Acquisition; Trade Handle: RePEc:otg:wpaper:0911 Template-Type: ReDIF-Paper 1.0 Author-Name: Onur Koska Author-Name-First: Onur Author-Name-Last: Koska Author-Email: onur.koska@uni-tuebingen.de Author-Workplace-Name: Department of Economics, University of Tuebingen Title: Foreign Direct Investment For Sale Abstract: This study examines the choice of a multinational firm between two alternative entry modes, a greenfield investment and a joint venture, under incomplete information. The joint venture partner is selected by an auction, which distinguishes this study from other studies in the literature. A private values auction allows a multinational firm to increase its share of the joint venture profit so that a joint venture is always preferable to greenfield investment. The model also examines the nationally optimal entry mode and finds that greenfield investment is likely to reduce welfare. The anticipated welfare implications of a joint venture crucially depend on the expectation of the marginal cost of the joint venture. Relative to a greenfield investment, a joint venture is welfare-improving if the negative impact of a joint venture on a local rival's profit is small. Length: 30 pages Creation-Date: 2009-10 Revision-Date: 2009-10 File-URL: http://www.otago.ac.nz/economics/research/otago077125.pdf File-Format: Application/pdf File-Function: First version, 2009 Number: 0910 Classification-JEL: F23; L24 Keywords: Foreign Direct Investment; Joint Venture; Incomplete Information; Auction with Externality Handle: RePEc:otg:wpaper:0910 Template-Type: ReDIF-Paper 1.0 Author-Name: Daniel Farhat Author-Name-First: Daniel Author-Name-Last: Farhat Author-Email: dan.farhat@otago.ac.nz Author-Workplace-Name: Department of Economics, University of Otago Title: Endogenous Labor Supply, Heterogeneous Firms and International Business Cycles Abstract: This paper examines employment dynamics and international business cycle transmission within a two-country dynamic stochastic general equilibrium model featuring an endogenously determined trade pattern. In contrast to existing literature, this model allows for the household's labor supply to be determined endogenously, producing fluctuations in employment as business cycles are transmitted from one country to another. The model is able to generate pro-cyclical domestic employment as well as positive correlations of employment and output across countries. In addition, previous studies have difficulty generating international correlations of consumption and investment. This model replicates these stylized facts by strengthening frictions in international asset markets. The structure of labor supply is shown to be vital for the transmission of business cycles through trade linkages. Length: 51 pages Creation-Date: 2009-09 Revision-Date: 2009-09 File-URL: http://www.otago.ac.nz/economics/research/otago077124.pdf File-Format: Application/pdf File-Function: First version, 2009 Number: 0909 Classification-JEL: F12, F16, F21, F4 Keywords: International Real Business Cycles, Labor Supply, Imperfect Competition, International Trade Handle: RePEc:otg:wpaper:0909 Template-Type: ReDIF-Paper 1.0 Author-Name: P. Dorian Owen Author-Name-First: P. Dorian Author-Name-Last: Owen Author-Email: dorian.owen@otago.ac.nz Author-Workplace-Name: Department of Economics, University of Otago Title: Limitations of the relative standard deviation of win percentages for measuring competitive balance in sports leagues Abstract: The relative standard deviation of win percentages, the most widely used measure of within-season competitive balance, has an upper bound which is very sensitive to variation in the numbers of teams and games played. Taking into account this upper bound provides additional insight into comparisons of competitive balance across leagues or over time. Length: 13 pages Creation-Date: 2009-07 Revision-Date: 2010-03 File-URL: http://www.otago.ac.nz/economics/research/otago077123.pdf File-Format: Application/pdf File-Function: Revised version, 2010 Number: 0908 Classification-JEL: D63, L83 Keywords: Competitive balance; Relative standard deviation; Idealized standard deviation Handle: RePEc:otg:wpaper:0908 Template-Type: ReDIF-Paper 1.0 Author-Name: Alvin Etang Ndip Author-Name-First: Alvin Author-Name-Last: Etang Ndip Author-Email: alvin.ndip@yale.edu Author-Workplace-Name: Department of Economics, Yale University Author-Name: David Fielding Author-Name-First: David Author-Name-Last: Fielding Author-Email: david.fielding@otago.ac.nz Author-Workplace-Name: Department of Economics, University of Otago Author-Name: Stephen Knowles Author-Name-First: Stephen Author-Name-Last: Knowles Author-Email: stephen.knowles@otago.ac.nz Author-Workplace-Name: Department of Economics, University of Otago Title: Does trust extend beyond the village? Experimental trust and social distance in Cameroon Abstract: In this paper we use experimental data collected in rural Cameroon to quantify the effect of social distance on trust and altruism. Our measure of social distance is one that is relevant to everyday economic interactions: subjects in a Trust Game play with fellow villagers or with someone from a different village. We find that Senders in a Trust Game pass significantly more money to Recipients from their own village than to Recipients from a different village. To test for the possibility that Senders are motivated by unconditional kindness, they also play a Triple Dictator Game. We find that Senders pass significantly more money on average in the Trust Game than in the Triple Dictator Game, confirming that transfers in the Trust Game are partly motivated by Trust. However, there is also a social distance effect in the Triple Dictator Game, and around one third of the social distance effect in the Trust Game is due to greater unconditional kindness to fellow villagers. Results from a Risk Game suggest that Trust Game transfers are uncorrelated with attitudes to risk. Length: 39 pages Creation-Date: 2009-07 Revision-Date: 2009-07 File-URL: http://www.otago.ac.nz/economics/research/otago077122.pdf File-Format: Application/pdf File-Function: First version, 2009 Number: 0907 Classification-JEL: C93, O12, Z13 Keywords: Experiment, Trust Game, Dictator Game, Risk Game, Social distance, Cameroon Handle: RePEc:otg:wpaper:0907 Template-Type: ReDIF-Paper 1.0 Author-Name: Jan-Jan Soon Author-Name-First: Jan-Jan Author-Name-Last: Soon Author-Email: jan.soon@otago.ac.nz Author-Workplace-Name: Department of Economics, University of Otago Title: When do students intend to return? Determinants of students' return intentions using a multinomial logit model Abstract: Using a multinomial logit model, this paper looks at the determinants of when tertiary level international students intend to return home upon completion of their studies in New Zealand, be it not return, return immediately, return after some working stint, or return after some further education. Good perceptions of home have a strong positive impact on the probability of returning immediately, with perception of home lifestyle having the strongest impact. Contrary to received wisdom, perception of wage does not play a dominant role in determining when students intend to return home. Length: 40 pages Creation-Date: 2009-06 Revision-Date: 2009-06 File-URL: http://www.otago.ac.nz/economics/research/otago077121.pdf File-Format: Application/pdf File-Function: First version, 2009 Number: 0906 Classification-JEL: C25, J61 Keywords: Students' migration, multinomial logit model, return intention Handle: RePEc:otg:wpaper:0906 Template-Type: ReDIF-Paper 1.0 Author-Name: Niven Winchester Author-Name-First: Niven Author-Name-Last: Winchester Author-Email: niven.winchester@otago.ac.nz Author-Workplace-Name: Department of Economics, University of Otago Author-Name: Raymond T. Stefani Author-Name-First: Raymond T. Author-Name-Last: Stefani Author-Email: stefani@csulb.edu Author-Workplace-Name: College of Engineering, California State University, Long Beach Title: An innovative approach to National Football League standings using optimal bonus points Abstract: Bonus points provide a simple way to improve the accuracy of league standings. We investigate the inclusion of bonuses in the National Football League (NFL) using a prediction model built on league points. Both touchdown-based and narrow-loss bonuses are shown to be significant. Our preferred system awards four points for a win, two for a tie, one point for scoring four or more touchdowns and one point for losing by seven or fewer points. Such a system would also make it easier for supporters to identify playoff contenders and place importance on otherwise meaningless end-of-game plays. Length: 33 pages Creation-Date: 2009-06 Revision-Date: 2009-06 File-URL: http://www.otago.ac.nz/economics/research/otago0771020.pdf File-Format: Application/pdf File-Function: First version, 2009 Number: 0905 Classification-JEL: C61, L83 Keywords: tournament design, sports predictions, NFL Handle: RePEc:otg:wpaper:0905 Template-Type: ReDIF-Paper 1.0 Author-Name: Viktoria Kahui Author-Name-First: Viktoria Author-Name-Last: Kahui Author-Email: viktoria.kahui@otago.ac.nz Author-Workplace-Name: Department of Economics, University of Otago Author-Name: Claire W. Armstrong Author-Name-First: Claire W. Author-Name-Last: Armstrong Author-Email: claire.armstrong@nfh.uit.no Author-Workplace-Name: Norwegian College of Fisheries Science, University of Tromso, Norway Title: Comment: The Economics of Interdependent Renewable and Non-renewable Resources revisited. Abstract: This work expands upon Swallow's theoretical analysis of interactions between renewable and non-renewable resources. In this comment the interaction is such that the renewable resource prefers the non-renewable environment, as opposed to SwallowÕs (op cit) case of the non-renewable environment being essential to the renewable resource. We find that this difference strongly affects the results, and makes the resources change from being complements to being substitutes, i.e. in the essential case profits from active development of the non-renewable resource come at the cost of reducing the optimal stock level for the renewable resource, while a preferred habitat implies the impacts of development can be offset by allowing for a larger renewable stock level. Length: 16 pages Creation-Date: 2009-05 Revision-Date: 2009-05 Number: 0904 Classification-JEL: Q22, Q30 Keywords: bioeconomic analysis; interaction renewable non-renewable resource Handle: RePEc:otg:wpaper:0904 Template-Type: ReDIF-Paper 1.0 Author-Name: Liam J. A. Lenten Author-Name-First: Liam J. A. Author-Name-Last: Lenten Author-Email: l.lenten@latrobe.edu.au Author-Workplace-Name: School of Economics and Finance, La Trobe University Author-Name: Niven Winchester Author-Name-First: Niven Author-Name-Last: Winchester Author-Email: niven.winchester@otago.ac.nz Author-Workplace-Name: Department of Economics, University of Otago Title: Optimal Bonus Points in the Australian Football League Abstract: Bonus point systems are a popular tournament design feature in some sports. We consider a bonus point system for the Australian Football League (AFL). In this paper, we utilise league points as a measure of team strength in a prediction model and choose the allocation of points to maximise prediction accuracy. For AFL data extending over seasons 1997-2008, we determine a bonus points system that does a better job at revealing strong teams than the current allocation of league points. We conclude that there is considerable scope for the introduction bonus points to improve tournament design in the AFL. Length: 26 pages Creation-Date: 2009-03 Revision-Date: 2009-03 File-URL: http://www.otago.ac.nz/economics/research/otago077119.pdf File-Format: Application/pdf File-Function: First version, 2009 Number: 0903 Classification-JEL: C61, L83 Keywords: Sport, Predictions, Estimation, Tournament Design Handle: RePEc:otg:wpaper:0903 Template-Type: ReDIF-Paper 1.0 Author-Name: Panicos Demetriades Author-Name-First: Panicos Author-Name-Last: Demetriades Author-Email: pd28@le.ac.uk Author-Workplace-Name: Department of Economics, University of Leicester Author-Name: David Fielding Author-Name-First: David Author-Name-Last: Fielding Author-Email: david.fielding@otago.ac.nz Author-Workplace-Name: Department of Economics, University of Otago Title: Information, Institutions and Banking Sector Development in West Africa Abstract: Using a new panel dataset for banks in eight West African countries, we explore the factors that exacerbate or alleviate excess liquidity, and the factors that promote or retard the rate of growth of banks' assets. Loan default rates in the region are high, and variations in the rate impact on liquidity and asset growth. However, the size of this effect is very sensitive to bank age. Some types of improvement in the quality of governance reduce excess liquidity and promote asset growth. However, the impact of other types of improvement, particularly with regard to corruption, is ambiguous. We uncover evidence that provides an explanation for this ambiguity. Length: 26 pages Creation-Date: 2009-01 Revision-Date: 2009-01 File-URL: http://www.otago.ac.nz/economics/research/otago077118.pdf File-Format: Application/pdf File-Function: First version, 2009 Number: 0902 Classification-JEL: G21, O16 Keywords: Africa, Banking, Default, Institutions, Liquidity Handle: RePEc:otg:wpaper:0902 Template-Type: ReDIF-Paper 1.0 Author-Name: Libertad Gonzalez Author-Name-First: Libertad Author-Name-Last: Gonzalez Author-Email: libertad.gonzalez@upf.edu Author-Workplace-Name: Department of Economics and Business, Universitat Pompeu Fabra Author-Name: Tarja Viitanen Author-Name-First: Tarja Author-Name-Last: Viitanen Author-Email: tarja.viitanen@otago.ac.nz Author-Workplace-Name: Department of Economics, University of Otago Title: The Long Term Effects of Legalizing Divorce on Children Abstract: We estimate the effect of divorce legalization on the long-term well-being of children. Our identification strategy relies on exploiting the different timing of divorce legalization across European countries. Using European Community Household Panel data, we compare the adult outcomes of cohorts who were raised in an environment where divorce was banned with cohorts raised after divorce was legalized in the same country. We also have "control" countries where all cohorts were exposed (or not exposed) to divorce as children, thus leading to a difference-in-differences approach. We find that women who grew up under legal divorce have lower earnings and income as well as worse health as adults compared with women who grew up under illegal divorce. These effects are not found for men. We find no effects of divorce legalization on childrenÕs family formation or dissolution patterns. Length: 37 pages Creation-Date: 2009-01 Revision-Date: 2009-01 File-URL: http://www.otago.ac.nz/economics/research/otago077117.pdf File-Format: Application/pdf File-Function: First version, 2009 Number: 0901 Classification-JEL: J12, J13, K36 Keywords: divorce, legislation, intergenerational effects, child outcomes Handle: RePEc:otg:wpaper:0901