The promise and perils of using big data in the study of corporate networks: problems,diagnostics and fixes

Network data on connections between corporate actors and entities – for instance through co‐ownership ties or elite social networks – are increasingly available to researchers interested in probing the many important questions related to the study of modern capitalism. Given the analytical challenges associated with the nature of the subject matter, variable data quality and other problems associated with currently available data on this scale, we discuss the promise and perils of using big corporate network data (BCND). We propose a standard procedure for helping researchers deal with BCND problems. While acknowledging that different research questions require different approaches to data quality, we offer a schematic platform that researchers can follow to make informed and intelligent decisions about BCND issues and address these through a specific work‐flow procedure. For each step in this procedure, we provide a set of best practices for how to identify, resolve and minimize the BCND problems that arise.     

THE LONG-RUN LINK BETWEEN MONEY GROWTH AND INFLATION

Is inflation always a monetary phenomenon? Many economists believe that the link between money growth and inflation in the U.S. has weakened over the last two decades due in part to the Federal Reserve's policy experiment in 1979–1982 and innovations in the financial sector of the economy. I find that the long-run relationship between money growth and inflation is strong in a statistical sense and important economically. The key result is that the trend or growth component in CPI inflation is entirely due to the trend component of monetary base growth. (JEL C32, E31, E51)     

IS THE TIME-SERIES EVIDENCE ON MINIMUM WAGE EFFECTS CONTAMINATED BY PUBLICATION BIAS?

Existing meta-analysis approaches to testing for publication bias are problematic when applied to time-series studies in economics, because changes in parameters can generate spurious evidence of publication bias. We suggest an alternative test in such contexts, and apply it to time-series studies of the effects of minimum wages on employment. In contrast to recent research by Card and Krueger [1995a], we find that the results of published time-series studies of minimum wage effects are consistent with structural change, and that the null hypothesis of no publication bias is not rejected by the evidence. ( JEL B41, C22, C40, J23)     

ECONOMIC MAN AS A MORAL INDIVIDUAL

We propose a concrete method for including moral concerns in preferences. In our framework, the agent maximizes utility subject to constraints, but the utility from consuming a specific commodity bundle varies in a lumpy or discontinuous way with the concurrent moral content of the individual's behavior. Our method also indicates how constraints vary with this moral content. Our approach seems more intuitively appealing than several competing frameworks, and can be used to explain a number of otherwise puzzling phenomena. ( JEL D11, A13)     

POWER IN A RURAL COUNTY

To more fully understand power structures in rural settings, this article investigates the power structure of an economically depressed rural county in southwestern Pennsylvania. The power structure must be viewed in the context of the economic hard times that the county has confronted. In this regard, there has been a decline in the number of local economic notables over the years making the formation of growth machines unlikely. The most powerful individual in the county, a wealthy philanthropist, has enhanced his stature and influence in the community by forming an economic development organization in an attempt to improve the economic situation in the county. The other powerful individuals in the county are political or state actors, who have benefited from the increases in government funding for various social programs.     

EXTERNAL RECRUITMENT AND INTRAFIRM MOBILITY

In Chan (1996), I suggest that a contest between internal and external candidates for a position within a firm is generally biased in favor of the former to maintain work incentive for existing workers. This implies that a successful external candidate tends to be superior in ability relative to internally promoted colleagues and therefore enjoys a higher probability of subsequent promotion. Moreover, this effect tends to diminish up the hierarchy if external competition is more of a threat at lower job levels. Analyzing personnel data from a U.S. financial corporation, I find consistent support for this hypothesis. (JEL J00 , J41 )     

CATHOLIC SCHOOLS, DROPOUT RATES AND EDUCATIONAL ATTAINMENT

This paper examines the effect of Catholic schooling on high-school dropout rates and educational attainment. Particular attention is given to the effect of selection into the Catholic school sector. After adjusting for self-selection, we find that sophomores in the Catholic schools are still substantially more likely to graduate with their class. It is also shown that seniors in the Catholic schools are not more likely to acquire more schooling than other seniors if selection is taken into account.