Steve Cook

An alternative approach to examining the ripple effect in UK house prices

This article examines the possibility of a ripple effect being present in the UK housing market using a previously unconsidered two-stage procedure. According to Drake, the ripple effect hypothesises that changes in house prices occurs earlier and more extensively in the South East of England than in other regions of the UK. Via application of non-parametric testing and business cycle dating techniques, evidence in favour of a ripple effect is derived.

β-convergence and the Cyclical Dynamics of UK Regional House Prices

The potential convergence of regional house prices in the UK is examined. In contrast to the existing literature which focuses upon stochastic convergence, the present paper considers alternative forms of convergence. Using a method based upon conditional probabilities of high and low growth rates, tests are employed to detect β-convergence in UK regional house prices. Importantly, given the suggested differences in regional house price dynamics over the course of the cycle in the housing market, β-convergence is considered not only over the full sample of observations available, but over cyclical sub-samples also. Interestingly, while convergence is not detected over the whole sample available, it is observed over the housing market cycle, with overwhelming evidence of convergence detected particularly during the downturn. These findings, supported by results for σ-convergence, show that failure to detect convergence may be due to its episodic nature being masked when arbitrarily defined sample periods are considered.

A new perspective on the ripple effect in the UK housing market: Comovement, cyclical subsamples and alternative indices

An alternative perspective is provided on the existence of a ripple effect in the UK housing market. In contrast to previous studies, the analysis involves consideration of information on the changes in house prices to which the hypothesis of house price diffusion posited by the ripple effect relates, rather than their levels. In an examination of changes in house prices in London relative to other regions of the UK, directional forecasting methods are employed to establish the extent of the relationship between geographical proximity and comovement across the three month window provided by quarterly data. Consequently, the analysis provides a direct examination of the ripple effect which refers to changes in prices rather than the convergence of levels which has become a feature of the empirical literature. The literature is extended further by both the application of dating techniques to perform the analysis across cycles and phases of cycles (recovery and recessionary periods) in the UK housing market, and the use of data from two alternative house price index providers. Striking results in support of the presence of a ripple effect are noted, particularly for the less commonly considered Halifax price index where the most significant results for comovement with London are exhibited by its contiguous regions. In addition, the cyclical subsamples considered indicate comovement to be greater during upturns, rather than downturns in the market. This is consistent with previous research showing London to correct – that is, exhibit differing behaviour to other regions – during downturns.

Crime across the States: Are US Crime Rates Converging?

Recent research concerning the potential presence of a national trend in regionally disaggregated US crime data is extended. In light of the varying levels of criminal activity noted in differing regions of the US, the present analysis considers whether a trend is emerging rather than currently present. Using alternative methods, potential convergence in criminal activity across the states of the US is examined. The results presented provide clear evidence of a previously undetected finding of convergence over the period 1960–2009 for all classifications of criminal activity considered. The importance and implications of these findings, along with their support in previous research on, inter alia, socioeconomic conditions, sentencing policies and alternative theories, are discussed.

New evidence on the importance of gender and asymmetry in the crime-unemployment relationship

The literature examining the crime–unemployment relationship is vast. Three recent developments in the analysis of this relationship are combined with a novel empirical method to explore the importance of gender effects and asymmetric adjustment when analysing the impact of unemployment upon criminal activity. Using data for the United States of America, a number of interesting results are obtained. The key finding concerns the importance of gender, with opportunity effects in criminal activity detected when considering female, but not male, unemployment. Further examination shows findings to support theories associated with ‘victimization’ and worsening socio-economic conditions, rather than those emphasizing ‘latchkey care’ effects and an absence of guardianship. Consideration of motivation effects provides further evidence of significant asymmetries in the response of crime to unemployment.

Death of the pedagogue: pluralism and non-didacticism

Contest and controversy; orthodoxy and heterodoxy; critique and reject: how can economics curricula be adjusted to illustrate the multiplicity of, frequently antagonistic, explanations for observed phenomena? This paper commences by addressing the meaning of pluralism within the rubric of Foucault and Barthes, proposing that the application of pluralism in economics is a more complex process than has previously been acknowledged. It posits that the emphasis falls too often on pedagogical issues that re-affirm hierarchical teacher-learner relationships which hinder learner autonomy and encourages the transmission of teacher bias. Arguing that the economics instructor should instead act as an enlightened navigator, it addresses the practical aspects of delivery by exploring two key modules in undergraduate degree provision: intermediate microeconomics and the dissertation.

An historical perspective on the forecasting performance of the Treasury Model: forecasting the growth in UK consumers’ expenditure

Drawing upon Treasury Official Economic Forecasts Vols. I & II, a series of Treasury Model (TM) forecasts of the percentage growth in real total consumers’ expenditure are derived for the period 1967 to 1989. The one-, two- and three-step ahead forecasts examined cover an interesting period which includes major shocks to the UK economy, business cycle effects and changes in economic policy. Whilst a battery of forecast evaluation statistics and tests do not detect any evidence of forecast bias or irrationality over the whole sample, split-sample analysis provides evidence of a switch from overprediction to underprediction around 1977. In addition, the application of ‘modified’ versions of Holden–Peel (1990) tests provides evidence of the longest horizon forecasts failing to capture the full movement of changes in consumption growth. Using simple regression and a selection of forecast encompassing tests, shorter horizon forecasts are found to dominate longer horizon forecasts, a feature which might be expected logically, but need not occur in practice. Finally, forecast performance is related to changes in model specification and modelling methodology.

The urban-rural divide, regional disaggregation and the convergence of crime

Potential regional variation in crime rates has been recognized as an issue of clear importance given its implications for the development and evaluation of theories of criminal activity, determining the appropriate level of disaggregation at which to undertake empirical analyses of crime and whether crime fighting policies should be constructed at a national or local level. Consequently, a literature has evolved examining the similarities in US regional crime rates and whether a national trend exists or is emerging. The present article extends the recent research into the emergence of a national trend by considering convergence in alternative classifications of crime using a data set subject to a higher degree of disaggregation than considered hitherto. The results obtained overturn previous findings obtained using more highly aggregated data, indicating the detection of convergence to be dependent upon the level of disaggregation considered. In addition, the extent of convergence detected is shown to vary across classifications of criminal activity and reflect anecdotally noted changes in the evolution of crime at a national level. The implications of the observed regional variation in crime for the urban–rural divide and theoretical, empirical and policy analyses are noted.

A re-examination of the opportunity and motivation effects underlying criminal activity

The opportunity and motivation effects underlying criminal activity presented in Cantor and Land (1985) are revisited. It is argued that a full appreciation of these effects requires examination of the evolution of criminal activity over the business cycle rather than in relation to simple measures of unemployment, as has been considered often in the literature. Using the derived cyclical components of a number of socio-economic indicators, the empirical evidence in support of the proposed theoretical relationships is examined. It is found that in contrast to the results obtained when using unemployment, consideration of alternative cyclical indicators provides very strong support for the presence of opportunity and motivation effects of the form predicted by Cantor and Land (1985). An interesting distinction between results for property and violent crimes is noted and discussed.

‘It’s just not worth a damn!: investigating perceptions of the value in attending university

ABSTRACT Mass expansion of the UK Higher Education (HE) sector is eroding its well-documented benefits – leading many to question whether HE remains worthwhile. Avoiding the traditional approach of estimating the returns to HE, we investigate why many now feel that attending university will not yield any financial benefits. Using BSA data from 2010 we find that this negativity is being driven by perceived lack of graduate job prospects, the rise in tuition fees and wage underpayment. We conclude that this may well fuel uncertainty and reduce demand for HE from lower socio-economic groups while increasing intra class conflict in higher socio-economic groups.