Discount rate heterogeneity among older households: a puzzle?

We put forward a method for estimating discount rates using wealth and income data. We build consumption from these data using the budget constraint. Consumption transitions yield discount rates by household groups. Applying this technique to a sample of older households, we find a similar distribution to those previously estimated using field data, though with a much lower mean than those found using experiments. Surprisingly, among this older population, patience is negatively correlated with education and numeracy. This goes against the positive correlation found for younger populations in experiments and some field studies. We discuss potential explanations for this result.     

What is ethnic in an ethnic economy?

This article examines critically the relationship between ethnicity and entrepreneurship in the sociology of immigrant economies. It argues that what is ethnic in an ethnic economy has often been confusingly conceptualised and that several factors now call for re-assessing the ethnic nature of immigrants' business activities. On the basis of a review of recent research, three such factors are outlined: the porosity of ethnic boundaries to cross-group business interactions; the diversity within immigrant economies in terms of status, gender, class and generation; and the political and institutional context in which immigrant economies take place. The conclusion stresses the need for multiple explanations of how and why immigrants become entrepreneurs, which take into account not only the meso-level constituted by ethnicity and social capital, but also micro-individual factors and macro-institutional settings.     

Probabilities as Similarity‐Weighted Frequencies

A decision maker is asked to express her beliefs by assigning probabilities to certain possible states. We focus on the relationship between her database and her beliefs. We show that if beliefs given a union of two databases are a convex combination of beliefs given each of the databases, the belief formation process follows a simple formula: beliefs are a similarity‐weighted average of the beliefs induced by each past case.     

Statistical Estimation for a Class of Self‐Regulating Processes

Self‐regulating processes are stochastic processes whose local regularity, as measured by the pointwise Hölder exponent, is a function of amplitude. They seem to provide relevant models for various signals arising for example in geophysics or biomedicine. We propose in this work an estimator of the self‐regulating function (that is, the function relating amplitude and Hölder regularity) of the self‐regulating midpoint displacement process and study some of its properties. We prove that it is almost surely convergent and obtain a central limit theorem. Numerical simulations show that the estimator behaves well in practice.     

MULTIREGIONAL FIRMS AND REGION SWITCHING IN THE U.S. MANUFACTURING SECTOR

I use data on U.S. manufacturing establishments to study the spatial reallocation of resources that takes place within surviving firms as they open and close establishments in different regions. To motivate the empirical analysis, I extend existing models of industry dynamics to include production‐location decisions within firms. Consistent with the theory, the empirical results show that only a fraction of firms make the same product in multiple regions, that multiregional firms are larger and more productive on average compared to single‐region firms, and that “region switching” is pervasive among multiregional firms and correlated with changes in firm and firm‐region characteristics. (JEL L2, F12, F23)     

Self-Employment and Immigrants' Incorporation: The Case of Turks in Germany

This essay discusses the impact of self-employment on immigrants' incorporation in the host society. It focuses on empirical material coming from Turkish migrants' business activities in Germany. After introducing the main features of contemporary German-Turkish entrepreneurship, the essay presents its socio-economic and cultural consequences for the Turkish minority. Relying on the numerous debates that can be found in the literature, it argues that this impact is ambivalent. In some cases, business ownership may constitute a way of achieving upward social mobility and a path towards a harmonious and pluralistic integration. But it is also frequently a reaction to disadvantage that fosters immigrants' socio-professional vulnerability and that may then lead to ghettoization. The essay then attempts to understand the reasons behind these divergent interpretations and suggests that they lie in the intermediary nature of trade, which is an activity that may connect people from different backgrounds but only in a limited way. Ethnographic observations and the concept of 'plural societies' are used to address this aspect of business. The conclusion suggests that, given the globally inferior position of Turkish immigrants, business might not be enough to enable them to catch up.     

Nonparametric regression estimation of conditional tails: the random covariate case

We present families of nonparametric estimators for the conditional tail index of a Pareto-type distribution in the presence of random covariates. These families are constructed from locally weighted sums of power transformations of excesses over a high threshold. The asymptotic properties of the proposed estimators are derived under some assumptions on the conditional response distribution, the weight function and the density function of the covariates. We also introduce bias-corrected versions of the estimators for the conditional tail index, and propose in this context a consistent estimator for the second-order tail parameter. The finite sample performance of some specific examples from our classes of estimators is illustrated with a small simulation experiment.     

Metamodeling of aircraft infrared signature dispersion

Existing computer simulations of aircraft InfraRed Signature (IRS) do not account for the dispersion induced by uncertainty on input data such as aircraft aspect angles and meteorological conditions. As a result, they are of little use to estimate the detection performance of optronic systems: in that case, the scenario encompasses a lot of possible situations that must indeed be addressed, but cannot be singly simulated. In this paper, a three-step methodological approach for predicting simulated IRS dispersion of imperfectly known aircraft is proposed. The first step is a sensitivity analysis. The second step consists in a Quasi-Monte Carlo survey of the code output dispersion. In the last step, a neural network metamodel of the IRS simulation code is constructed. It will allow carrying out thorough computationally demanding tasks, such as those required for optimization of an optronic sensor. This method is illustrated in a typical scenario, namely an air-to-ground full-frontal attack by a generic combat aircraft, and gives satisfactory estimation of the infrared signature dispersion.     

OECD's ‘Better Life Index’: can any country be well ranked?

We critically review the Better Life Index (BLI) recently introduced by the Organization for Economic Co-operation and Development (OECD). We discuss methodological issues in the definition of the criteria used to rank the countries, as well as in their aggregation method. Moreover, we explore the unique option offered by the BLI to apply one's own weight set to 11 criteria. Although 16 countries can be ranked first by choosing ad hoc weightings, only Canada, Australia and Sweden do so over a substantial fraction of the parameter space defined by all possible weight sets. Furthermore, most pairwise comparisons between countries are insensitive to the choice of the weights. Therefore, the BLI establishes a hierarchy among the evaluated countries, independent of the chosen set of weights.