Bebonchu Atems

Outward FDI from the USA and host country financial transparency

Abstract Extant research has focused on the role of host country corruption as either an attractant or deterrent to foreign investment. These studies generally contend that corruption acts more like a ‘grabbing hand’ than as a ‘helping hand’. However, it is plausible that a significant component of foreign investment may be attracted to locales that offer opaque financial environments. Specifically, we hypothesize that money laundering opportunities may encourage illicit capital flows into certain jurisdictions. Using the USA as the ‘source’ country, we investigate the effect of corruption and money laundering opportunities on Foreign Direct Investment (FDI) flows. The empirical findings indicate that corruption deters foreign investment, while money laundering opportunities attract it. We also show that the effect of money laundering and corruption vary based on the host countrys level of development. Our findings bolster the contention that FDI into certain host countries is motivated by a facilitation of illicit capital flows.

Do jet fuel price movements help forecast airline fares and the demand for air travel

ABSTRACT The paper studies the predictive content of jet fuel prices for the U.S. aviation industry through in-sample and out-of-sample forecasting exercises. Our results suggest the possibility of limited improvements in the predictions of airline fares, and little evidence of predictability from jet fuel prices to measures of air travel demand.

Revisiting the statistical specification of near-multicollinearity in the logistic regression model

Abstract This paper revisits the statistical specification of near-multicollinearity in the logistic regression model. We argue that the ceteris paribus clause, which assumes that the maximum likelihood estimator of β remains constant as the correlation (ρ) between the regressors increases, invoked under the traditional account of near-multicollinearity is rather misleading. We derive the parameters of the logistic regression model and show that they are functions of ρ, indicating that the ceteris paribus clause is unattainable. Monte Carlo simulations confirm these findings and further show that: coefficient estimates and related statistics fluctuate in a non-symmetric, non-monotonic way as |ρ|→1; that the impact of near-multicollinearity is centered on the estimates of β; and that the impact on substantive inferences does not necessarily follow what the traditional account implies.

A note on the determinants of long-run aggregate state productivity growth

We use data envelopment analysis to estimate state-level productivity and then use the pooled mean group approach to investigate its long-run determinants. Results indicate that human capital, infrastructure, energy shocks, a diverse mix of industries and states with large urban populations are associated with higher long-run aggregate state productivity growth, while unionisation has no long-run effects.