Within a continuous-time overlapping generations model, featuring endogenous intensive margin of the labour supply and retirement decision, we analyse the issue of passing the burden of payroll revenues onto consumption or capital. We find that large long-run welfare gains occur when pension benefits are refinanced by consumption taxes. However, the transition to the new steady state is very painful for a large fraction of existing cohorts. On the other hand, the capital base is too small to sustain pension benefits but could be made larger if capital taxes are raised. Yet that would entail significant welfare losses.

This paper analyses the impact of currency crises on the labour share and identifies two main types of channel: within- and across-sector effects. First crises erode the bargaining power of workers so that within sectors, crises lower the labour share. Nevertheless, structural changes occurring during currency crises may change the aggregate level of the labour share if sectors differ in their capital intensities. We perform estimations on manufacturing sectoral panel data for 20 countries. We conclude that currency crises lower the aggregate manufacturing labour share by around 2 percentage points, and that this decline reflects mostly changes within manufacturing subsectors.

We argue that education exerts positive external effects on health, beyond the standard internal effects documented in the literature. We implement an innovative approach to control for endogeneity and omitted variables problems, and present evidence for the significant role played by higher education in explaining longevity across countries. Our findings provide empirical evidence in support of our hypothesis of educational externalities on health.

We construct a model in which oligopolistic firms decide between locating in a country where employment protection implies costly output adjustments and in one without employment protection. Using a two-period three-stage game with uncertainty, we demonstrate that location is influenced by both flexibility and strategic concerns. The strategic effects under Cournot work towards domestic anchorage in the country with employment protection, while those under Bertrand do not. Strategic agglomeration can occur in the inflexible country under Cournot and even under Bertrand, provided that uncertainty and foreign direct investment costs are low.

The experimental ‘learning-to-forecast’ literature finds that subjects use simple linear backward-looking models when forecasting in environments with little to no inout the economic framework. We study the formation of expectations in a laboratory economy of monopolistic firms and labour unions with almost complete knowledge of the model. We observe simple backward-looking rules, but also a considerable share of model-based expectations using information on the economic structure. At least for some subjects, expectations are informed by theory. As in the previous literature, we find individual prediction rules to be heterogeneous.

Welfare implications of imposing intellectual property rights (IPR) protection on health goods in developing countries are analysed using a North–South model. Consumption of health goods counteracts adverse effects of region-specific diseases on labour supply. Health needs differ between consumers in innovating and imitating countries, weakening the benefits of southern IPR enforcement for the North and strengthening the benefits for the South. Southern regions with unique health needs are more likely to benefit from IPR enforcement if healthcare infrastructure is adequate and the southern market is large enough to stimulate sufficient innovation. There is then also interregional income convergence.

We look for evidence of adaptation in wellbeing to major life events using eighteen waves of British panel data. Adaptation to marriage, divorce, birth of child and widowhood appears to be rapid and complete; this is not so for unemployment. These findings are remarkably similar to those in previous work on German panel data. Equally, the time profiles with life satisfaction as the wellbeing measure are very close to those using a twelve-item scale of psychological functioning. As such, the phenomenon of adaptation may be a general one, rather than being found only in German data or using single-item wellbeing measures.

A number of teacher workforce policies implicitly assume that job performance is a relatively stable attribute within teachers. We use longitudinal data on 5th grade teachers in North Carolina to assess this using value-added measures (VAMs) of job performance. We find that there is a permanent component of teacher performance that is stable in teachers over long periods—implying that workforce policies selecting teachers based on VAMs could effectively improve student achievement. But importantly, our time series model suggests that the permanent component of performance is considerably smaller than that which is often used to estimate workforce policy impacts.

We explore the relative influence of family and neighbourhood on pupils' test scores and how this varies by sibling type. Using English register data we find that the neighbourhood explains at most 10–15% of the variance in pupils' test scores, whereas the variance explained by family is between 44% and 54% at the end of primary school and between 47% and 61% at the end of compulsory schooling. The family influence is significantly higher for identical twins. It is also higher for dizygotic twins than for non-twin siblings brought up at different times and therefore experiencing varying family circumstances.

Using a sample of mother–child pairs from the National Longitudinal Survey of Youth 1979, we study the economics of cultural transmission regarding women's roles. We find that a mother's attitudes have a statistically significant effect on those of her children. Furthermore, we find a strong association between the attitudes of sons in their youth and their wives' labour supply as adults. For daughters, the association between their own attitudes and adult work outcomes is weaker and seems to operate through the educational channel. Our findings indicate that cultural transmission contributes to heterogeneity in the labour supply of women.

In a North–South trade model, we analyse the implications of southern patent protection on southern innovation, profits and welfare. Southern patent protection may make the northern firm worse off and the southern firm better off by increasing the southern firm's incentive for innovation and affecting the nature of competition in the world market. The impact of southern patent protection on a country's welfare and on world welfare depends on the cost of southern innovation and the degree of product substitutability. We provide important insights into the outcomes of international negotiations regarding patent enforcement in the southern countries.

We develop and test a model of the simultaneous determination of global gross fixed capital investments by multinational firms. We integrate a model of multi-product firms choosing optimal manufacturing locations with a model of dynamic investment optimization. Firms adjust capital stocks in each location in accordance with the expected marginal profitability of capital. Analysis of 1504 fixed capital investment decisions by Japanese multinational firms confirms the prediction that investment is determined not only by total factor productivity, effective demand, and wage levels in the host country, but also by wage levels in other countries in which the firm operates.

We show that a combined bet at the bookmaker and at the bet exchange market yields a guaranteed positive return in 19.2% of the matches in the top five European soccer leagues. Moreover, we find that all considered bookmakers frequently offer arbitrage positions, and that they experience, on average, negative margins from these postings. Our findings indicate that bookmakers set prices not only by optimizing over a particular bet, but also by taking the future trading behaviour of their customers into account. We discuss the implications for the literature on the relationship between betting market structure and informational efficiency.

This paper compares three lending mechanisms used by microfinance organizations, namely individual lending, simultaneous group lending and sequential group lend cotract enforcement is weak, sequential group lending unambiguously achieves the highest repayment rate. Hence sequential group lending can operate in settings in which simultaneous group lending and individual lending are not feasible due to weak contract enforcement. Simultaneous lending in contrast achieves the highest repayment rate if the level of official contract enforcement is high and if the likelihood of default is relatively low.

We study gift exchange in a field experiment where a random subsample of participants in the Swiss Labour Force Survey received vouchers to be used in adult training. Actual voucher redemption can be traced, giving us the unique opportunity to study whether gift exchange in the form of participation in future rounds of the survey depends on the perceived usefulness of the gift. The group of voucher recipients as a whole has significantly higher response rates. There is considerable heterogeneity, however. Our results point to a long-lasting gift exchange relationship only for the subgroup that redeemed their vouchers.