José M. Labeaga

A double-hurdle rational addiction model with heterogeneity: Estimating the demand for tobacco

Abstract In this paper, we estimate a tobacco consumption rational addiction model with panel data. We apply Becker and Murphys (1988, Journal of Political Economy 96, 675–700) proposal to individual rather than aggregate data. Given the censoring nature of the dependent variable, we use a double-hurdle specification after testing that the factors governing the consumption equation are not the same as those that govern the participation equation. We use non-linear panel data methods to consistently retrieve the structural form parameters, as usual linear panel data methods applied to the consumption equation conditional on participation do not provide consistent estimates. The empirical results reject the myopic model and give support to the rational addiction one. Finally, although long-run elasticities are bigger than short-run elasticities, the individuals response to prices is very small.

A Residential Energy Demand System for Spain

Sharp price fluctuations and increasing environmental and distributional concerns, among other issues, have led to a renewed academic interest in energy demand. In this paper we estimate, for the first time in Spain, an energy demand system with household microdata. In doing so, we tackle several econometric and data problems that are generally recognized to bias parameter estimates. This is obviously relevant, as obtaining correct price and income responses is essential if they may be used for assessing the economic consequences of hypothetical or real changes. With this objective, we combine data sources for a long time period and choose a demand system with flexible income and price responses. We also estimate the model in different sub-samples to capture varying responses to energy price changes by households living in rural, intermediate and urban areas. This constitutes a first attempt in the literature and it proved to be a very successful choice.

Estimation and control of Spanish energy-related CO2 emissions: an input–output approach

This article uses input–output methods to obtain the energy-related CO2 intensities for the Spanish economy in 1992. Based on those intensities, it yields a structural decomposition of Spanish energy-related CO2 emissions and an estimation of the price effects of several hypothetical carbon taxes levied on fossil fuel consumption. These results are related to the ongoing discussion within EU circles and member states about the consequences of carbon/energy taxes, and to the simulated effects of such taxes in various countries. The paper also responds to the lack of reliable disaggregated data on Spanish CO2 emissions and to the growing awareness on the limited effectiveness of Spanish climate change policies.

An empirical analysis of the demand for physician services across the European Union

This paper presents parameter estimates for physician service equations using the “European Community Household Panel” for 12 countries covering the period 1994–1996. The focus is on two specific points: (1) the identification of behavioural similarities and differences in the demand for health services across the 12 countries; (2) the variability in demand for health services represented through a joint model for all countries. We found that there are significant differences among countries, although there are also similarities in the effect of variables such as health stock, labour situation or family structure. An important fraction of the variability in the demand for health services across countries could be explained by differences in age, income and the role of general practitioners as gatekeepers in the public health system. We found some evidence of induced demand in the decision to visit a specialist and in the number of such visits.

HEALTH STATUS AND RETIREMENT DECISIONS FOR OLDER EUROPEAN COUPLES

In this paper we use data the European Community Household Panel (ECHP) to describe and analyse the dynamics of joint labour force behaviour of older couples for the EU12 countries. We focus on three main issues: the relevance of joint retirement across EU12 countries, the existence of complementarities in leisure and/or assortative matting and the effects of health variables. Concerning the evidence, we first find that a working spouse is more likely to retire the more recently the other spouse has retired; this effect is stronger if the wife is the working spouse. Second, there is evidence of assortative mating and/or complementarities in leisure; the effects of all relevant factors on the retirement decision of one spouse depend strongly on whether the other one is working, unemployed, or retired. Third, besides the standard evidence that poor health increases the retirement probability, we find that the husbands health affects the couples retirement decisions much more strongly than the wifes health does. Additional asymmetric effects are detected with respect to income related variables.

Participation, heterogeneity and dynamics in tobacco consumption: evidence from cohort data

In this paper we look at the behaviour of households as far as participation and rate of consumption of tobacco are concerned using cohort data from the Spanish Continuous Family Expenditure Survey during the period 1985-94. We test the results, in statistical and economic terms, from several estimators on samples with different levels of aggregation and offer evidence on the different behaviour of households according to several demographic characteristics. The results suggest that the effect of legislative measures cannot be identified when participation and consumption are not separately considered. Once we do so, these measures seem to affect participation alone.

Modelling Innovation Activities Using Discrete Choice Panel Data Models

The main purpose of this chapter is to analyze the determinants of innovation activity using Spanish data at firm level corresponding to the manufacturing sector. We focus on the relationship between the R&D effort undertaken by firms, and the innovation decision claimed by them. We are really estimating a research production function (see, for example, Crepon and Duguet, 1997), where we include other controls as firm characteristics and market conditions in addition to the typical inputs. Ester Martinez-Ros and Jose M, Labeaga169

A study of petrol consumption using Spanish panel data

Methods are proposed for the estimation of equations for consumption categories subject to non-participation and other types of censoring using an unbalanced panel data set on petrol expenditures from the Spanish Continuous Family Expenditure Survey. The use of panel data allows one to deal with two issues that pose econometric problems when dealing with individual budget data. On one hand, unobserved time invariant heterogeneity is controlled for. On the other hand, the problem of censoring in the dependent variable is addressed and the measurement error induced by infrequent purchases is corrected. Results suggest the use of probabilities of purchase estimated from the temporal pattern of expenditure records in order to carry out this correction. The estimated demand system is subsequently used to simulate the effects of changes in the taxation of petrol.

Award Errors and Permanent Disability Benefits in Spain

There is a controversial debate about the effects of permanent disability benefits on labor market behavior. In this paper we estimate equations for deserving and receiving disability benefits to evaluate the award error as the difference in the probability of receiving and deserving using survey data from Spain. Our results indicate that individuals aged between 55 and 59, self-employers or working in an agricultural sector have a probability of receiving a benefit without deserving it significantly higher than the rest of individuals. We also find evidence of gender discrimination since male have a significantly higher probability of receiving a benefit without deserving it. This seems to confirm that disability benefits are being used as an instrument for exiting the labor market for some individuals approaching the early retirement or those who do not have right to retire early. Taking into account that awarding process depends on Social Security Provincial Department, this means that some departments are applying loosely the disability requirements for granting disability benefits.

The Relationship Between Firm Size and Innovation Activity: A Double Decision Approach†

The main purpose of this paper is to analyse the relationship between firm size and innovation activity using Spanish data at firm level corresponding to the manufacturing sector for the period 1990-93. This exercise is different to previous applications because we allow for different size effects in the decision to innovate and the innovation count equation, in the context of a double-hurdle approach. Several tests confirm the hurdle negbin model. We find that firm size is a relevant factor, although size effects are different in both decisions. A robust result from the different specifications estimated is the rejection of the Gilbert and Newbery hypotheses. We find out that the behaviour of firm size is neither linear in the decision nor in thc count equation. We also provide additional, and sometimes different, evidence to previous Spanish studies on R&D.