Matthew John Higgins

Sigma Convergence versus Beta Convergence: Evidence from U.S. County-Level Data

In this paper we outline (i) why o-convergence may not accompany â- convergence, (ii)cite evidence of â-convergence in the U.S., (iii) and use USA county-level data containing over 3,000 cross-sectional observations to demonstrate that o-convergence does not hold across the U.S., or within the vast majority of the individual U.S. states.

Explaining Inequality the World Round: Cohort Size, Kuznets Curves, Andopenness

Klaus Deininger and Lyn Squire have recently produced an inequality database for a panel of countries from the s to the s. We use these data to decompose the sources of inequality into three central parts: the demographic or cohort-size effect; the so-called Kuznets Curve or demand effects; and the commitment to globalization or policy effects. We also control for education supply, the so-called natural resource curse, and other variables suggested by the literature. While the Kuznets Curve comes out of hiding when the inequality relationship is conditioned by the other two, cohort size seems to be the most important force at work. We offer a resolution to the apparent conflict between this macro finding on cohort size and the contrary implications of recent research based on

Growth and Convergence across the United States: Evidence from County-Level Data

We use U.S. county data (3,058 observations) and 41 conditioning variables to study growth and convergence. Using ordinary least squares (OLS) and three-stage least squares with instrumental variables (3SLS-IV), we report on the full sample and metro, nonmetro, and and regional samples: (1) OLS yields convergence rates around 2%; 3SLS yields 6%8%; (2) convergence rates vary (for example, the Southern rate is 2.5 times the Northeastern rate); (3) federal, state, and local government negatively correlates with growth; (4) the relationship between educational attainment and growth is nonlinear; and (5) the finance, insurance, and real estate industry and the entertainment industry correlate positively with growth, whereas education employment correlates negatively.

Growth and Convergence Across the U.S.: Evidence from County-Level Data

We use U.S. county data (3,058 observations) and 41 conditioning variables to study growth and convergence. Using OLS and 3SLS-IV we report on the full sample and metro, non-metro, and 5 regional samples: (1) OLS yields convergence rates around 2 percent; 3SLS yields 6–8 percent; (2) convergence rates vary (e.g., the Southern rate is 2.5 times the Northeastern rate); (3) federal, state and local government negatively correlates with growth; (4) the relationship between educational attainment and growth is nonlinear; and (5) finance, insurance & real estate industry and entertainment industry positively correlates with growth while education employment negatively correlates.

Balancing Innovation and Access: Patent Challenges Tip the Scales

Development of new but costly pharmaceuticals is put at risk by U.S. law that emboldens generics competition. Improvements in pharmaceutical research and development (R&D) depend on product innovation. But the number of new compounds approved annually by the U.S. Food and Drug Administration (FDA) has fallen from an average of 35 in 1996–2001 to 20 in 2002–07 (1). This decline stems from several factors (2); however, one particular U.S. regulation—the Paragraph IV patent challenge—is increasingly stifling new drug innovation and deserves our attention.

The Allocation of Control Rights in Pharmaceutical Alliances

This paper uses alliances to test theories of the firm within the context of the biopharmaceutical industry. I find that the allocation of control rights between pharmaceutical and biotechnology firms is sensitive to the bargaining position of both parties. In addition, biotechnology firms entering their first alliance tend, on average, to relinquish more rights. I also explore if and when alliances begin to impact pharmaceutical firm shareholder value. Overall, the market tends to favor earlier stage alliances which are consistent with an underlying healthy pharmaceutical research pipeline.

Productivity and the Role of Complementary Assets in Firms’ Demand for Technology Innovations

This article uses data on transactions in the pharmaceutical industry to examine the demand-side of technology outsourcing. By integrating a transaction--cost economics perspective with the analysis of internal R&D capabilities, we find that firms with relatively more cospecialized complementary assets or relatively strong internal R&D productivity have a lower propensity to source a technology from outside the firm. We show, however, that since downstream capabilities and internal R&D are complementary activities in the presence of asset specificity and transaction costs, a decrease in internal R&D productivity reduces the marginal value of the downstream assets within firm boundaries, thus stimulating the demand for external technology. Copyright 2010 The Author 2010. Published by Oxford University Press on behalf of Associazione ICC. All rights reserved., Oxford University Press.

Conveying quality and value in emerging industries: Star scientists and the role of signals in biotechnology☆

Managers of private entrepreneurial firms face obstacles in raising capital both in placing a value on a firm and conveying value to investors. These problems are exacerbated when the firm is small, has limited assets (except for human capital) and has yet to have a lead product. In such cases metrics are necessary to convey the value of the firm to investors. Here we explore the importance within the biotechnology industry of the non-financial metrics firms used to convey value during two important initial public offerings (IPO) windows (1989 to 1992 and 1996 to 2000). We also examine whether there was a change over time in the importance of various metrics in determining the value of a biotechnology firm. We find that firms with an affiliated Nobel laureate succeeded in raising the value of their firms by more than

Impacts of Climate Change on Scour-Vulnerable Bridges: Assessment Based on HYRISK

30 million compared to firms without a Nobel laureate during the first period, suggesting that a Nobel laureate served as a powerful signal of firm value. Our results also suggest that the biotechnology regime changed and the Nobel Prize lost its luster as a signal of value in the second period. The importance of several other non-financial metrics changed as well. We conclude that these non-financial metrics of value change in relative importance to potential investors and financial markets as learning occurs and as an industry matures.

Behind the Scenes: Sources of Complementarity in R&D

More than 20% of the bridges in the United States were built more than 50 years ago, at a time in which intense precipitation events were much less common. However, very little work has been done on the use of scour risk-assessment models to assess how climate change increases bridge failure probabilities. This paper develops a risk-assessment framework based on HYRISK, a model developed to assess the probability of a bridge failure due to scour, and illustrates oneway in which current engineering risk-assessment models can be used to quantify the additional risks and expected economic losses associated with a changing climate. Application of this framework to all bridges in the United States that carry vehicular traffic over water finds that economic losses due to climate change factors will increase by at least 15% over current losses and that the expected number of annual bridge failures in the United States will increase by at least 10% over current failures. Climate-based risk measures, such as those developed as part of this study, could be included in asset management systems to help state DOTs prioritize maintenance, operation, and replacement schedules. DOI: 10.1061/(ASCE)IS.1943-555X.0000109.