Current Social Science Research Report--Economics #11, April 17, 2007.

CSSRR-Economics is a weekly email report produced by the Data and Information Services Center at the University of Wisconsin-Madison. It seeks to help social science researchers keep up to date with the latest developments in the field. This report will contain selected listings of new: reports, articles, bibliographies, working papers, tables of contents, conferences, data, and websites. For more information, including an archive of back issues and subscription information see:


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1. Small Business Administration Report: "Minorities in Business: A Demographic Review of Minority Business Owners," (April 2007, .pdf format, 42p.).

Related press release:

2. Bureau of Labor Statistics Reports:

A. "Experimental All Employee Hours and Earnings Series from the Current Employment Statistics Program" (April 2007).

B. "Employment from the BLS household and payroll surveys: summary of recent trends" (April 2007, .pdf format, 16p.).

3. US Government Economic Releases from the National Bureau of Economic Research: Links to releases for Apr. 10-17, 2007 are available at the site.

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US States:


Department of Business, Economic Development, and Tourism Report: "An Economic Analysis of the Hawaii Unemployment Insurance Program: Recent Trends and Some Policy Options" (March 2007, .pdf format, 53p.).


State Data Center Updates: The State Data Center issued the following updates (.pdf and Microsoft Excel format) on Apr. 13, 2007: for the State of Iowa: "State economic profile: 2000-2005"; "Wage and salary disbursements by industry: 1969-2005"; "Personal income by industry: 1969-2005"; for Iowa counties: "Average wage per job: 2000-2005."

See under Apr. 13, 2007 listing.

New Jersey:

Department of Labor & Workforce Development Report: "Unemployment Rate: 1990-2006 (April 2007, Microsoft Excel format).

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NGOs and Other Countries

European Community:

Europa Periodicals: Statistics in Focus. In the last week Statistics in Focus released six new issues (Nos. 44/2007--49/2007, all .pdf format).,1136118&_dad=portal&_schema=PORTAL&_calledfrom=2


International Monetary Fund Reports, Country Report, New Titles:

A. "World Economic Outlook" (April 2007, .pdf format, 302p.).

B. "Regional Economic Outlook: Western Hemisphere" (April 2007, .pdf format, 38p.).

C. "Regional Economic Outlook: Asia and Pacific" (April 2007, .pdf format, 88p.).

D. "Global Financial Stability Report: Market Developments and Issues," (April 2007, .pdf format, 197p.).

E. The latest Country Reports span the time period from Apr. 10, 2007--Apr. 13, 2007 (No. 07/140).

F. "IMF Bookstore New Titles (March 2007, .pdf format, 12p.).



National Statistical Institute Report: "Key Indicators for Bulgaria" (April 2007, .pdf format, 8p.).



Statistics Denmark: Statbank Denmark Updates: The following annual tables have been updated through 2006.

A. "AFG: Cultivated area by region and crops"

B. "AFG1: Crops by crop, unit and area"

C. "AFG2: Farms and area with selected crops by region (County), area with the crop and unit:

D. "AFG3: Farms and area with selected crops by region (province), area with the crop and unit"



Statistics Norway News Release: Horticultural production 2006. Preliminary figures: Good year for harvest of fruit" (Apr. 12, 2007). The news release links to two topical tables.



Ministry of National Economy Periodical: Monthly Statistical Bulletin: March 2007 (April 2007, HTML and .pdf format).



Statistical Office News Release: "Labour Force Survey Results, Slovenia, 2006" (Apr. 12, 2007).



Statistics Sweden Press Release: "Sharp rise in contributions to municipalities and county councils" (Apr. 12, 2007).



1. Department for Environment, Food, and Rural Affairs Report: "Agricultural Price Indices, United Kingdom (2000 =100)" (Stats 12/07, April 2007, .pdf format, 13p.).

2. National Statistics Office Periodical: Financial Statistics (No. 539, April 2007, .pdf format, 288p.).

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Urban Institute Briefs:

A. "Two-Thirds of Tax Units Pay More Payroll Tax Than Income Tax," by Leonard E. Burman, Greg Leiserson (April 2007, .pdf format, 1p.).

B. "Fixing the AMT by Raising Tax Rates," by C. Eugene Steuerle (April 2007, .pdf format, 2p.).

C. "U.S. Budget Outlook: Near-Term Bright, Long-Term Dark," by Rudolph G. Penner (BCA Research via Urban Institute, April 2007, .pdf format, 9p.).


Center on Budget and Policy Priorities Report: "Federal Tax Burdens in Historical Perspective," by Aviva Aron-Dine (April 2007, HTML and .pdf format, 3p.).

More information on CBPP:

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Federal Reserve Banks:

Finance and Economics Discussion Series:

A. "A Cohort-Based Model of Labor Force Participation," by Bruce Fallick and Jonathan Pingle (WP 2007-09, April 2007, .pdf format, 59p.). Links to an abstract and full text are available at:

B. "Alternative Methods of Unit Nonresponse Weighting Adjustments: An Application from the 2003 Survey of Small Business Finances," by Lieu N. Hazelwood, Traci L. Mach, and John D. Wolken (WP 2007-10, April 2007, .pdf format, 18p.). Links to an abstract and full text are available at:

C. "Expected Stock Returns and Variance Risk Premia," by Tim Bollerslev and Hao Zhou (WP 2007-11, April 2007, .pdf format, 30p.). Links to an abstract and full text are available at:

Federal Reserve Bank of Cleveland (Ohio): "On Forecasting the Term Structure of Credit Spreads," by C.N.V. Krishnan, Peter H. Ritchken, and James B. Thomson (WP07-05, April 2007, .pdf format, 30p.).

Predictions of firm-by-firm term structures of credit spreads based on current spot and forward values can be improved upon by exploiting information contained in the shape of the credit-spread curve. However, the current credit-spread curve is not a sufficient statistic for predicting future credit spreads; the explanatory power can be increased further by exploiting information contained in the shape of the riskless-yield curve. In the presence of credit-spread and riskless factors, other macroeconomic, marketwide, and firm-specific risk variables do not significantly improve predictions of credit spreads. Current credit-spread and riskless-yield curves impound essentially all marketwide and firm-specific information necessary for predicting future credit spreads.

Federal Reserve Bank of Philadelphia (Pennsylvania): "Dynamics of Worker Flows and Vacancies: Evidence from the Agnostic Identification Approach," by Shigeru Fujita (Working Paper No. 07-12, March 2007, .pdf format, 37p.).

This paper establishes robust cyclical features of the U.S. labor market by estimating VAR models of the job loss rate, job finding rate, and vacancies. To identify the "aggregate business cycle shock," the author adopts the agnostic Bayesian identification approach developed by Uhlig (2005) and others. His approach traces not only responses of transition rates and vacancies but also those of gross job losses and hires and thereby the stock of unemployment in one unified framework. The author finds that when a negative shock occurs, (i) both the job loss rate and gross job losses rise quickly and remain persistently high, (ii) the job finding rate and vacancies drop in a hump-shaped manner, and (iii) gross hires respond little initially, but eventually rise. He argues that these results point to the importance of job loss in understanding U.S. labor market dynamics. The paper also considers the "disaggregate model," which uses data disaggregated by six demographic groups and incorporates transitions into and out of the labor force. The author finds that job loss continues to play a dominant role among prime-age male workers, while, for other groups, changes in the job finding rate are more important.

Federal Reserve Bank of St. Louis (Missouri):

A. "Understanding the Puzzling Effects of Technology Shocks," by Pengfei Wang, and Yi Wen (WP 2007-18A, April 2007, .pdf format, 25p.). Links to an abstract and full text are available at:

B. "Affiliated Mutual Funds and Analyst Optimism," by Massimo Guidolin (WP 2007-17A, April 2007, .pdf format, 51p.). Links to an abstract and full text are available at:

C. "Mean-Variance vs. Full-Scale Optimization: Broad Evidence for the UK," by Bjorn Hagstromer, Richard G. Anderson, Jane M. Binner, Thomas Elger, and Birger Nilsson (Working Paper 2007-016A, April 2007, .pdf format, 26p.). Links to an abstract and full text are available at

D. "Supply Shocks, Demand Shocks, and Labor Market Fluctuations," by Helge Braun, Reinout De Bock, and Riccardo DiCecio (Working Paper 2007-015A, April 2007, .pdf format, 34p.). Links to an abstract and full text are available at:

Federal Reserve Bank of San Francisco (California): "Model Uncertainty and Monetary Policy," by Richard Dennis (Working Paper 2007-09, April 2007, .pdf format, 29p.).


Model uncertainty has the potential to change importantly how monetary policy should be conducted, making it an issue that central banks cannot ignore. In this paper, I use a standard new Keynesian business cycle model to analyze the behavior of a central bank that conducts policy with discretion while fearing that its model is misspecified. I begin by showing how to solve linear-quadratic robust Markov-perfect Stackelberg problems where the leader fears that private agents form expectations using the misspecified model. Next, I exploit the connection between robust control and uncertainty aversion to present and interpret my results in terms of the distorted beliefs held by the central bank, households, and firms. My main results are as follows. First, the central bank's pessimism leads it to forecast future outcomes using an expectations operator that, relative to rational expectations, assigns greater probability to extreme inflation and consumption outcomes. Second, the central bank's skepticism about its model causes it to move forcefully to stabilize inflation following shocks. Finally, even in the absence of misspecification, policy loss can be improved if the central bank implements a robust policy.


National Bureau of Economic Research: NBER has released the following working papers for the week of Apr. 2 - Apr. 9, 2007:

New papers are: 13017-13042


European Central Bank: "Credit market and macroeconomic volatility," by Caterina Mendicino (No. 743, March 2007, .pdf format, 47p.).


This paper investigates the role of credit market size as a determinant of business cycle fluctuations. First, using OECD data I document that credit market depth mitigates the impact of variations in productivity to output volatility. Then, I use a business cycle model with borrowing limits a la Kiyotaki and Moore (1997) to replicate this empirical regularity. The relative price of capital and the reallocation of capital are the key variables in explaining the relation between credit market size and output volatility. The model matches reasonably well the reduction in productivity-driven output volatility implied by the established size of the credit market observed in OECD data.


Bank of England:

A. "The real exchange rate and quality improvements," by Karen Dury and Ozlem Oomen (Working Paper No. 320, April 2007, .pdf format, 34p.).


This paper studies how the real exchange rate might respond to product innovation (improvements in the quality of goods) as opposed to process innovation (increased efficiency in the production of goods). We develop a two-country dynamic stochastic general equilibrium model, where quality improvements affect both the demand and the supply side of the economy. We show that the real exchange rate defined in terms of prices per quality unit (quality-adjusted prices) does not always move in the same direction as that defined in terms of unit prices (quality-unadjusted prices), illustrating the importance of measuring quality correctly.

B. "Comparing the pre-settlement risk implications of alternative clearing arrangements," by John P. Jackson and Mark J. Manning (Working Paper No. 321, April 2007, .pdf format, 34p.).


In recent years, there has been a marked expansion in the range of products cleared through central counterparty clearing houses, accompanied by a trend towards consolidation in the clearing infrastructure. The financial stability implications of these developments are of considerable policy interest. In this paper, we use a simulation approach to analyse, in a systematic way, the potential pre-settlement cost and risk implications of these developments. Our results point towards substantial risk-reduction benefits from multilateral clearing arrangements, arising from multilateral netting and mutualisation. The paper also examines individual incentives to join multilateral clearing arrangements. We suggest that arrangements with restricted direct participation and tiered membership may be a natural response to the uneven distribution of total pre-settlement costs when agents are of heterogeneous credit quality and it is costly to individually tailor margin.

C. "An affine macro-factor model of the UK yield curve," by Peter Lildholdt, Nikolaos Panigirtzoglou and Chris Peacock (Working Paper No 322, April 2007, .pdf format, 46p.).


This paper estimates yield curve models for the United Kingdom, where the underlying determinants have a macroeconomic interpretation. The first factor is an unobserved inflation target, the second factor is annual inflation, and the third factor is a ‘Taylor rule residual’, which, among other things, captures the effects of the output gap and monetary policy surprises in the Taylor rule. We find that the long end of the yield curve is primarily driven by changes in the unobserved inflation target. At shorter maturities, yield curve movements reflect short-run inflation and the Taylor rule residual. For holding periods of one month, our preferred model implies that agents require compensation for risks associated with cyclical and inflation shocks but do not require compensation for shocks to the inflation target. For holding periods beyond one month, agents require compensation for all three sources of risks. Time series of risk premia on long forward rates from the preferred yield curve model have declined since the 1970s, which is consistent with perceptions of declining macroeconomic uncertainty or perhaps more efficient macroeconomic stabilisation policies. Model-implied risk premia at short maturities match up reasonably well with survey-based risk premia, which indicates that the model could be useful for the purpose of extracting market-based interest rate expectations.


International Monetary Fund: IMF has added several working papers . The papers are Nos.07/86--07/92.


World Bank Development Programme: WDP has recently released several new working papers. See the list at:

New Papers are: 4199-4213

and click on "More" for the rest.


Institute for the Study of Labor (IZA) [University of Bonn, Germany]: IZA has recently released several new working papers.

The new working papers are: 2740-2759


Center for Economic Studies/Ifo Institute for Economic Research (CESifo) [Munich, Bavaria, Germany]: CESifo has recently released a new working paper:

and "Browse Working Paper List" for 2007.

The new papers is numbered 1960.


New Economic Papers (NEP)-ALL. The latest list of New Economic Papers (Apr. 9, 2007) is available at:


AgEcon Search: This week's new working papers from AgEcon Search at the University of Minnesota are available at:

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JOURNAL TABLES OF CONTENTS (check your library for availability):

Economic Journal (Vol. 117, No. 519, March 2007).

Journal of International Economics (Vol. 72, No. 1, May 2007).

Journal of Political Economy (Vol. 115, No. 2, April 2007). Note: Full electronic text of this journal is available in the ProQuest Research Library. Check your library for the availability of this database and this issue.

Journal of Urban Economics (Vol. 61, No. 3, May 2007).

Management Science (Vol. 53, No. 4, April 2007).

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US Senate Committee on Health, Education, Labor, and Pensions Hearing Testimony: "Closing the Gap: Equal Pay for Women Workers," a hearing held April 12, 2007 (.pdf format). Note: a video transcript of the hearing is available at the site.

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US Department of Agriculture, Economic Research Service: "Wheat Data." "This data product contains statistics on wheat--including the five classes of wheat: hard red winter, hard red spring, soft red winter, white, and durum--and rye. Includes data published in the monthly Wheat Outlook and previously annual Wheat Yearbook. Data are monthly, quarterly, and/or annual depending upon the data series." (Updated Apr. 12, 2007, HTML, Microsoft Excel, and .pdf format).


Bureau of Labor Statistics: "Upcoming change to CES data access with release of data on May 4, 2007," (April 12, 2007).


Federal Reserve Bank of St. Louis (Missouri): ArchivaL Federal Reserve Economic Data (ALFRED): "Vintage data have been added for 5 series on the GDP and CPI releases. The earliest vintage date added is 1947-08-17 for series Personal Saving.

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Panel Study Of Income Dynamics Bibliography Update: The University of Michigan Institute for Social Research PSID has recently added the following item to its bibliography. The entire bibliography can be searched or browsed in various ways at:

Carter, Vernon and Marx, Jerry. What Motivates African-American Charitable Giving: Findings from a National Sample. Administration in Social Work. 2007; 31(1):67-85

Conley, Dalton and Glauber, R. Family Background, Race, and Labor Market Inequality. Annals of the American Academy of Political and Social Science. 2007; 609(1):134-152

Felsenstein, Daniel and Persky, Joseph. Evaluating Local Job Creation: A "Job Chains" Perspective. Journal of the American Planning Association. 2007; 73(1):23-35.

Filer, Larry and Fisher, Jonathan D. Do Liquidity Constraints Generate Excess Sensitivity in Consumption? New Evidence from a Sample of Post-Brankruptcy Households. Journal of Macroeconomics. 2007; In Press.

Hendricks, Lutz. The Intergenerational Persistence of Lifetime Earnings. European Economic Review. 2007; 51(1):125-144.

Holst, Roland. Social Security and Policy Risk: Evidence, Welfare Costs, and Effects on Wealth Accumulation. Illinois: University of Chicago; 2006.

Hurst, Erik and Willen, Paul. Social Security and Unsecured Debt. Journal of Public Economics. 2007; online.

Magnani, Elisabetta. Is Workers' Mobility a Source of R&D Spillovers?: Evidence of Effects of Innovative Activities on Wages. International Journal of Manpower. 2006; 27(2):169.

Nosal, Ed and Rupert, Peter. How Amenities Affect Job and Wage Choices Over the Life Cycle. 2007. 2007; online.

Parker, Simon C. Entrepreneurship Among Married Couples in the United States. Labour Economics. 2007; online.

Pryor, Frederic L. The Anatomy of Increasing Inequality of U.S. Family Incomes. Journal of Socio-Economics. 2007; online.

Simonsohn, Uri. New Yorkers Commute More Everywhere: Contrast Effects in the Field. The Review of Economics and Statistics. 2006; 88(1):1-9.

Sullivan, Teresa A.; Warren, Elizabeth, and Westbrook, Lawrence. Less Stigma or More Finiancial Distress: An Empirical Analysis of the Extraordinary Increase in Bankruptcy Filings. Stanford Law Review. 2006; 59(2):213-257.

Tiejdens, Kea and Dragstra, Anna. 'How Many Hours Do You Usually Work?': An Analysis of the Working Hours Questions in 26 Large-Scale Surveys in Six Countries and the European Union. Time Society. 2007; 16(_):119-130.

Wilhelm, Mark O. The Quality and Comparability of Survey Data on Charitable Giving. Nonprofit and Voluntary Sector Quarterly. 2007; 36(1):65-84.

Yanashita, Takashi. House Price Appreciation, Liquidity, Constraints, and Second Mortgages. Journal of Urban Economics. 2007; online.

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