Risa Kumazawa

Capital mobility, foreign aid, and openness: further panel data evidence from sub-Saharan Africa

This study uses several alternative panel data estimation techniques (pooled ordinary least squares, fixed effects, and random effects) to examine the effect of domestic savings, foreign aid, the evolution of capital mobility over time, and openness on investment rates for a sample of 29 sub-Saharan African countries over the time period 1980 to 2001. The empirical evidence suggests the presence of capital mobility in line with previous studies of developing economies and that capital mobility has gradually increased over time. Moreover, foreign aid and openness both have positive and significant impacts on investment rates.

Capital Mobility and the Feldstein-Horioka Puzzle: Re-Examination of Less Developed Countries

This empirical study extends the work of Coakley et al. (Manchester School, Vol. 72 (2004), pp. 569-590) with respect to the Feldstein-Horioka puzzle for a sample of 47 developing countries. The study examines the savings-investment relationship through a comparison of the Feldstein-Horioka cross-section estimator results with the results obtained from a mean group estimator allowing for the cross-section dependence and permanent shocks to the current account. The mean group estimator results indicate higher capital mobility with a savings coefficient of 0.36, 25 per cent lower than the estimates based on the cross-section estimator, for the whole sample with little variation across subregions.

Promotion speed and its effect on attrition of Navy-enlisted personnel: addressing heterogeneity in high school credentials

This article investigates the relationship between recruit quality and promotion speed of the US Navys first-term enlisted personnel, which in turn is expected to affect retention. It also investigates whether there are quality differences between the various types of high school credentials presented at the time of recruitment, including test-based and attendance-based equivalencies and nontraditional high school diplomas. The results of this article suggest that the Navys recent targeting of individuals with alternative high school credentials and nonhigh school graduates, who score in the top half of the Armed Forces Qualification Tests (AFQTs) as substitutes for diploma holders have desirable results for promotion speed but undesirable results for retention.

An empirical analysis of patents flows and R&D flows around the world

In this article, we empirically investigate the effect of Research and Development (R&D) flows on patent flows around the world. We do this using an unbalanced panel consisting primarily of Organization for Economic Co-operation and Development (OECD) countries that have both patent and R&D expenditure information broken down by domestic and foreign sources. Our analysis shows that even among a fairly homogeneous group of countries, the sources of patents and R&D differ substantially. Using a dynamic panel framework, we find that domestic R&D per capita increases domestic patents per capita only for the European Patent Convention (EPC) countries that already have a decentralized approach to innovation. Foreign R&D per capita increases foreign patents per capita in all countries even though foreign R&D constitutes a very small fraction of total R&D. We find that some of these differences can be attributed to the locations of the patent applications, including those to the European Patent Office (EPO), United States Patent and Trademark Office (USPTO) and triadic patent applications to the EPO, USPTO and Japan Patent Office (JPO) simultaneously.

The Effect of Organic Farms on Global Greenhouse Gas Emissions

The emission of greenhouse gases (GHGs) is a great concern for mankind as it believed that when GHGs such as carbon dioxide (CO2), nitrous oxide (N2O), and methane (CH4), trap energy from the sun, they contribute to global warming. Even though greenhouse gases occur naturally in the atmosphere, there are noteworthy man-made contributions through agricultural and industrial production. Agricultural land itself contributes to 12% of global GHG emissions while emissions from all sectors related to agricultural production contribute to an estimated 25-30% of all GHG emissions (International Trade Centre, 2007). The Kyoto Protocol was established in Kyoto, Japan in December, 1997 as an amendment to the United Nations Framework Convention on Climate Change (UNFCCC) to regulate global GHG emissions. It remains the most comprehensive international agreement to date through the setting of target reductions by industrialized nations in North America, Europe, Asia and Australia, commonly known as “Annex I” countries, shown in Table A-1 of the Appendix.

A Real-Options Approach to Post-Hurricane Loss Valuation of Damage Property: Rebuild or Repair?

In this paper, we investigate the rebuild or repair decision that property owners face after damages caused by catastrophic hurricanes such as Katrina in New Orleans. In particular, we consider how the degree of risk aversion and uncertainty affect the decision-making process. A theoretical model is developed using the real-options framework of Dixit and Pindyck (1994). According to the model, the decision to rebuild a property is reached much later when there is a high degree of uncertainty over future social costs and a high discount rate. We demonstrate these effects using simulations with actual numbers from Hurricane Katrina.

Patenting in the Pharmaceutical Industry

The chapter investigates the returns to R&D expenditures on patenting in the pharma‐ ceutical industry, using a panel data of 32 countries. Due to the unique situation in the industry that come from the patent being the new drug and additional clinical trials which must be conducted for safety and efficacy, the pharmaceutical industry is analyzed alone. The results indicated that for pharmaceutical patent applications with the United States Patent and Trademark Office (USPTO), the European Patent Office (EPO) and the triadic family consisting of USPTO, EPO and the Japan Patent Office (JPO), pharmaceuti‐ cal R&D expenditures had no impact coming from European countries. However, for the six non-European countries in the dataset (Australia, South Korea, Mexico, Romania, Singapore and Taiwan), the R&D always had statistically significant effects on all three patent applications in the industry. The results were more pronounced when the United States and Japan were also included. While China, Brazil and India were excluded due to missing pharmaceutical R&D data, it is hypothesized that the effect of these countries would have made the results stronger.

Interest Rate Manipulation, Environmental Damage, and Loss Valuation

The damage generated by Hurricane Katrina caused significant private as well as social costs. The water and force from the hurricane and subsequent flooding caused immediate property damage, but also potential environmental contamination over time. The decision on the part of property owners affected by Katrina to deal with damaged property must take into account both the private and social costs. This paper explores this decision making process using a real-options model. In particular, we focus on the element of time preference in this decision. We analyze the impact that changes in monetary policy, and ultimately the discount rate, have on the decision to repair or rebuild a property damaged by flooding. According to the theory, rising interest rates would suggest a greater propensity to defer the option to rebuild damaged properties, whereas falling interest rates cause property owners to reach the decision to rebuild properties relatively more quickly.