Examining the Econom(etr)ic Relevance of Discretizing Panel Data: an Application to the Belgian Labour Market

ABSTRACT: The object of this paper is to explore how to use administrative data for econometric purposes when these data measure total annual duration spent in various states. A basic issue addressed is whether the information extracted through categorising continuous data actually defines an economically meaningful concept of an individual position on the labour market. The main findings are that discretization indeed leads interpretable transitions on the labour market, and that the mobility between positions rather low in Belgium.     

Formal and Informal Risk Sharing in LDCs: Theory and Empirical Evidence

We develop and estimate a model of dynamic interactions in which commitment is limited and contracts are incomplete to explain the patterns of income and consumption growth in village economies of less developed countries. Households can insure each other through both formal contracts and informal agreements, that is, self‐enforcing agreements specifying voluntary transfers. This theoretical setting nests the case of complete markets and the case where only informal agreements are available. We derive a system of nonlinear equations for income and consumption growth. A key prediction of our model is that both variables are affected by lagged consumption as a consequence of the interplay of formal and informal contracting possibilities. In a semiparametric setting, we prove identification, derive testable restrictions, and estimate the model with the use of data from Pakistani villages. Empirical results are consistent with the economic arguments. Incentive constraints due to self‐enforcement bind with positive probability and formal contracts are used to reduce this probability.     

Population Changes in Europe. Demographic and Social Prospects and Problems

Abstract. Over recent years, the European Community has experienced profound demographic changes which, to a large extent, have already determined its demographic future. One of the more significant consequences of demographic and social trends is a marked fragmentation of the family with people giving absolute priority to the individual dimension in their lives and in terms of society as a whole. Legal regulations and administrative practice have not totally–and not everywhere – adapted to the far-reaching changes in the family so as to adequately protect the family and its weaker members in particular: children, the elderly, the disabled, people with mental and social illnesses, the poor. In this field, some measures will be proposed in this paper. The imbalances in demographic-occupational growth in the Euro-Mediterranean area–the area with which the EC is most directly in contact–are and will be of an exceptional amplitude, as has already been shown, to an extent never before experienced in the history of mankind. We must ask ourselves if this very strong differential pressure, which is also of a political and socio-economic nature, will lead to steady and long-lasting migratory flows. Some considerations regarding the future action and intervention of the EC close the paper.     

A mortality model based on a mixture distribution function

A new mortality model based on a mixture distribution function is proposed. We mix a half-normal distribution with a generalization of the skew-normal distribution. As a result, we get a six-parameter distribution function that has a good fit with a wide variety of mortality patterns. This mixture model is fitted to several mortality data schedules and compared with the Siler (five-parameter) and Heligman–Pollard (eight-parameter) models. Our proposal serves as a convenient compromise between the Heligman–Pollard model (which ensures a good fit with data but is often overparameterized) and the Siler model (which is more compact but fails to capture ‘accident humps’).     

Financial oppression and post-separation child positions in Sweden

The present paper deals with post-separation child positions in two domains of practice in the Swedish welfare state: welfare benefits such as financial aid and child contact. The area of concern is financial oppression in the context of parental separation. Empirically, the study draws upon three types of material: interviews with victimised mothers, court orders in welfare benefit appeals and court orders in contested contact cases. Findings suggest that financial abuse in the context of parental separation is a non-question in the domain of welfare benefits, and in the domain of child contact framed as a conflict between equal parties. Object without voice and with needs ignored was the typical child position in welfare benefits cases, whereas incompetent subject was more prominent in child contact cases. Age order as a form of domination may be reinforced by the practice of both domains.     

Comparing Life Satisfaction of Immigrants and Natives Across Europe: The Role of Social Contacts

Research on immigrants’ assimilation is widespread both in the U.S. and Europe. While it has been extensively studied how immigrants fare compared to natives on socio-economic indicators, few studies have focussed on immigrants’ perception of their position. In this paper we focus on comparing life satisfaction of immigrants and natives across Europe and on the role of social embeddedness. Using data from the first six rounds (2002–2012) of the European Social Survey, a repeated cross-sectional survey, we find that life satisfaction among immigrants is lower than among natives even though differences diminish over generations. For first generation immigrants part of the life satisfaction gap is explained by the lower level of social embeddedness they have compared to natives. We also find that social embeddedness is a key explanatory factor for life satisfaction for both immigrants and natives. For two out of the three indicators of social embeddedness that we consider we however find different patterns of association with life satisfaction for immigrants compared to natives.     

Si-GARCH: Construction and validation of a new method for the detection of breaking points in models

In this article, we define a new method (Si-GARCH) for signal segmentation based on a class of models coming from econometrics. We make use of these models not to perform prediction but to characterize portions of signals. This enables us to compare these portions in order to determine if there is a change in the signal’s dynamics and to define breaking points with an aim of segmenting it according to its dynamics. We, then, expand these models by defining a new coefficient to improve their accuracy. The Si-GARCH method was tested on several thousands of hours of biomedical signals coming from intensive care units.     

Business Perspectives in Southeast Europe

This paper deals with economic development in Southeast Europe and the effect of the European Union and its likely enlargement eastwards on socioeconomic expectations in the entire area. The EU factor introduced in the literature indicates that an EU enlargement could have a positive and significant impact on business and economic expectations of international investors. The acquis communautaire and the process of new candidate countries will be analyzed, as well as EU attention and a regional dimension of stability. The focus should be maintained on common fundamental issues, such as regional cooperation as a means that in effect could produce positive effects for promoting reconciliation and combating organized crime and corruption.     

Nonparametric weighted symmetry tests

Weighted symmetry is an extension of the classical notion of symmetry in which the tails of a distribution are similar, up to a scaling factor. The authors develop test statistics of weighted symmetry based on empirical processes. The finite‐dimensional distributions of the proposed statistics are either non‐parametric or conditionally nonparametric, according as the parameters of weighted symmetry are known or estimated. Asymptotically, the distributions of the processes behave like Brownian bridges or motions, leading to familiar distributions for the proposed test statistics. The authors also establish the asymptotic normality of Hodges‐Lehmann type estimators based on a generalization of the Wilcoxon signed rank test. Furthermore, they propose density estimators in mat setting.     

Assessing the Unidimensionality of Psychological Scales: Using Multiple Criteria from Factor Analysis

Whenever one uses a composite scale score from item responses, one is tacitly assuming that the scale is dominantly unidimensional. Investigating the unidimensionality of item response data is an essential component of construct validity. Yet, there is no universally accepted technique or set of rules to determine the number of factors to retain when assessing the dimensionality of item response data. Typically factor analysis is used with the eigenvalues-greater-than-one rule, the ratio of first-to-second eigenvalues, parallel analysis, root-mean-square-error-of-approximation, or hypothesis testing approaches involving chi-square tests from Maximum Likelihood or Generalized Least Squares estimation. The purpose of this study was to investigate how these various procedures perform individually, and in combination, when assessing the unidimensionality of item response data via a computer simulated design. Conditions such as sample size, magnitude of communality, distribution of item responses, proportion of communality on second factor, and the number of items with non-zero loadings on the second factor were varied. Results indicate that there was no one individual decision-making method that identified unidimensionality under all conditions manipulated. Given the low communalities, all individual decision-making methods failed to detect unidimensionality for the combination where sample size was small, magnitude of communality was low, and item distributions were skewed. A set of guidelines and a new statistical methodology are provided for researchers.