Taking Innovation to the Streets: Microgeography, Physical Structure, and Innovation

2020 ◽  
Vol 102 (5) ◽  
pp. 912-928 ◽  
Author(s):  
Maria P. Roche
Keyword(s):  
Fixed Effects ◽  
City Planning ◽  
Knowledge Exchange ◽  
Physical Structure ◽  
Set Covering ◽  
Regional Innovation ◽  
Data Set ◽  
Omitted Variable Bias ◽  
Variable Bias ◽  
Block Groups

In this paper, we analyze how the physical layout of cities affects innovation by influencing the organization of knowledge exchange. We exploit a novel data set covering all census block groups in the contiguous United States with information on innovation outcomes, street infrastructure, as well as population and workforce characteristics. To deal with concerns of omitted variable bias, we apply commuting zone fixed effects and construct instruments based on historic city planning. The results suggest that variation in street network density may explain regional innovation differentials beyond the traditional location externalities found in the literature.

scholarly journals Lock-In and Team Effects

2015 ◽  
Vol 18 (4) ◽  
pp. 376-387
Author(s):  
Trey Dronyk-Trosper ◽  
Brandli Stitzel
Keyword(s):  
Set Covering ◽  
Future Research ◽  
Prior Work ◽  
Omitted Variable Bias ◽  
Specific Effects ◽  
Heterogeneous Effects ◽  
Team Success ◽  
Variable Bias ◽  
Lock In ◽  
Least Squares Approach

How important is recruiting to a football program’s success? While prior research has attempted to answer this question, we utilize an extensive panel set covering 13 years of games along with a two-stage least squares approach to investigate the effects of recruiting on team success. This article also includes new control variables to account for omitted variable bias that prior work may have missed. We also split our sample to investigate whether recruiting displays heterogeneous effects across schools. Additionally, we find evidence that the benefits of recruiting are driven by team-specific effects, indicating that team success may be more heavily derived from the ability of teams to harness and improve their recruits than their ability to utilize each athlete’s raw abilities. This leads to important revelations regarding future research into both the value of recruits and what drives a football team’s success.

The Impact of ICT Investment on Establishment Productivity

2003 ◽  
Vol 184 ◽  
pp. 99-110 ◽  
Author(s):  
Thomas Zwick
Keyword(s):  
Panel Data ◽  
Unobserved Heterogeneity ◽  
Data Set ◽  
Omitted Variable Bias ◽  
Lagged Effects ◽  
Variable Bias ◽  
Employee Characteristics ◽  
The Impact ◽  
Establishment Panel Data

This paper finds substantial effects of ICT investments on productivity for a large and representative German establishment panel data set. In contrast to the bulk of the literature also establishments without ICT capital are included and lagged effects of ICT investments are analysed. In addition, a broad range of establishment and employee characteristics are taken account of in order to avoid omitted variable bias. It is shown that taking into account unobserved heterogeneity of the establishments and endogeneity of ICT investments increases the estimated lagged productivity impact of ICT investments.

Relative supervisor education and worker well-being

2018 ◽  
Vol 39 (5) ◽  
pp. 731-745
Author(s):  
Benjamin Artz
Keyword(s):  
Fixed Effects ◽  
Design Methodology ◽  
Well Being ◽  
Longitudinal Survey ◽  
Content Type ◽  
Omitted Variable Bias ◽  
Worker Education ◽  
Education Levels ◽  
Variable Bias ◽  
The Relationship

Purpose Less educated supervisors create worker status incongruence, a violation of social norms that signals advancement uncertainty and job ambiguity for workers, and leads to negative behavioral and well-being outcomes. The purpose of this paper is to compare education levels of supervisors with their workers and measure the correlation between relative supervisor education and worker job satisfaction. Design/methodology/approach Using the only wave of the 1979 National Longitudinal Survey of Youth that identifies education levels of both supervisor and worker, a series of ordered probit estimates describe the relationship between supervisor education levels and subordinate worker well-being. Extensive controls, sub-sample estimates and a control for sorting confirm the estimates. Findings Worker well-being is negatively correlated with having a less educated supervisor and positively correlated with having a more educated supervisor. This result is robust to a number of alternative specifications. In sub-sample estimates, workers highly placed in an organization’s hierarchy do not exhibit reduced well-being with less educated supervisors. Research limitations/implications A limitation is the inability to control for worker fixed effects, which may introduce omitted variable bias into the estimates. Originality/value The paper is the first to introduce relative supervisor–worker education level as a determinant of worker well-being.

scholarly journals Female on boards and the risk-taking of microfinance institutions: The moderating role of outreach

2020 ◽  
Vol 16 (2) ◽  
pp. 19-34
Author(s):  
Michael Adusei
Keyword(s):  
Risk Taking ◽  
Fixed Effects ◽  
Positive Impact ◽  
Microfinance Institutions ◽  
Female Representation ◽  
Return On Assets ◽  
Omitted Variable Bias ◽  
Variable Bias ◽  
Moderating Role

This study examines the effect of female on boards on risk-taking with data from 401 microfinance institutions (MFIs) drawn from 64 countries. The study also investigates whether the effect is sensitive to the outreach performance of MFIs. The MFIs sampled for this study are spread across the six MFI regions. The study measures MFI risk by its risk-taking Z-score and risk-adjusted return on assets. The fixed effects estimation technique, known to overcome the omitted variable bias, is deployed to analyze the data. The results show that female representation in the boardroom increases the risk-taking of MFIs. However, when female on boards interacts with the depth of outreach performance of an MFI, its positive impact on MFI risk is observed. It suggests that female directors are more likely to be beneficial to risk management in MFIs that lend more to indigent clients. Several tests, including an instrumental variable test for endogeneity, have been conducted to confirm the robustness of these results.

Housing features and rent: estimating the microstructures of rental housing

2019 ◽  
Vol 12 (2) ◽  
pp. 210-225 ◽  
Author(s):  
Hayato Nishi ◽  
Yasushi Asami ◽  
Chihiro Shimizu
Keyword(s):  
Design Methodology ◽  
Rental Housing ◽  
Hedonic Model ◽  
Traditional Media ◽  
Data Set ◽  
Content Type ◽  
Unique Data ◽  
Omitted Variable Bias ◽  
Variable Bias ◽  
Hedonic Approach

Purpose While consumers did not previously have information on detailed housing features via traditional media, such as magazines, nowadays, due to the progress in information technology, they can access detailed information on various housing features via housing information websites. Therefore, detailed housing features may affect current rents to some extent. This paper aims to identify the effects of detailed housing features on rent and on omitted variable bias in Tokyo, Japan. Design/methodology/approach This paper applies the hedonic approach. To identify the effects of features which are not observed previously, we use a unique data set that contains various housing features and over 200,000 housing units. This data set enables to simulate the situations when the researcher cannot get some variables, and this simulation shows which variables cause omitted variable bias. Findings The analysis shows that housing features significantly influence housing rent. If significant housing feature variables are not included in the hedonic model, the estimated coefficients show omitted variable bias. Additionally, unit-specific features such auto-locking door can cause omitted variable bias on location-specific features such accessibility to downtown. Originality/values This paper shows empirical evidence that detailed housing features can cause omitted variable bias on other features including variables which are often used in previous searches. The result from our unique data set can be a guide for variable selection to reduce omitted variable bias.

Profit sharing and firm profitability

2018 ◽  
Vol 1 (2/3) ◽  
pp. 191-220 ◽  
Author(s):  
Matthias Strifler
Keyword(s):  
Instrumental Variables ◽  
Fixed Effects ◽  
Unobserved Heterogeneity ◽  
Profit Sharing ◽  
Set Covering ◽  
Theoretical Research ◽  
Data Set ◽  
Content Type ◽  
Firm Profitability ◽  
Instrumental Variables Approach

Purpose This purpose of this paper to examine how profit sharing depends on the underlying profitability of firms. More precisely, motivated by theoretical research on fair wages and unionized labor markets, profit sharing is estimated for six different profitability categories: positive, increasing, positive and increasing, negative, decreasing and negative or decreasing. Design/methodology/approach The paper exploits a high-quality linked employer–employee data set covering the universe of Finnish workers and firms. Endogeneity of profitability and self-selection of firms in different profitability categories are accounted for by an instrumental variables approach. The panel-structure of the data is used to control for unobserved heterogeneity (spell and individual fixed effects). Findings Profits are shared if firms are profitable or become more profitable. The wage-profit elasticity varies between 0.03 and 0.13 in such firms. However, profits are not shared if firms make losses or become less profitable. There is no downward wage adjustment. Research limitations/implications Because of the instrumental variables approach the question of external validity arises. Further empirical research on profit sharing with an explicit focus on firm profitability is warranted. The results of the paper indicate a connection between rent sharing and wage rigidity, as suggested by union and fair wage theory. Originality/value This is the first paper to consistently estimate the extent of profit sharing depending on the underlying profitability of firms.

scholarly journals A Reassessment of the Relationship Between Inequality and Growth

2000 ◽  
Vol 90 (4) ◽  
pp. 869-887 ◽  
Author(s):  
Kristin J Forbes
Keyword(s):  
Economic Growth ◽  
Income Inequality ◽  
Negative Relationship ◽  
Data Set ◽  
Omitted Variable Bias ◽  
Specific Effects ◽  
Variable Bias ◽  
Time Invariant ◽  
The Relationship ◽  
Country Specific

This paper challenges the current belief that income inequality has a negative relationship with economic growth. It uses an improved data set on income inequality which not only reduces measurement error, but also allows estimation via a panel technique. Panel estimation makes it possible to control for time-invariant country-specific effects, therefore eliminating a potential source of omitted-variable bias. Results suggest that in the short and medium term, an increase in a country's level of income inequality has a significant positive relationship with subsequent economic growth. This relationship is highly robust across samples, variable definitions, and model specifications. (JEL O40, O15, E25)

scholarly journals The fixed effects approach as an alternative to multilevel analysis for cross-national analyses

2021 ◽  
Author(s):  
Katja Moehring
Keyword(s):  
Multilevel Modeling ◽  
Fixed Effects ◽  
Regression Models ◽  
Macro Level ◽  
Multilevel Regression ◽  
Country Level ◽  
Omitted Variable Bias ◽  
Fixed Effects Models ◽  
Variable Bias ◽  
Cross National

Multilevel models that combine individual and contextual factors are increasingly popular in comparative social science research; however, their application in country-comparative studies is often associated with several problems. First of all, most data-sets utilized for multilevel modeling include only a small number (N<30) of macro-level units, and therefore, the estimated models have a small number of degrees of freedom on the country level. If models are correctly specified paying regard to the small, level-2 N, only a few macro-level indicators can be controlled for. Furthermore, the introduction of random slopes and cross-level interaction effects is then hardly possible. Consequently, (1) these models are likely to suffer from omitted variable bias regarding the country-level estimators, and (2) the advantages of multilevel modeling cannot be fully exploited.The fixed effects approach is a valuable alternative to the application of conventional multilevel methods in country-comparative analyses. This method is also applicable with a small number of countries and avoids the country-level omitted variable bias through controlling for country-level heterogeneity. Following common practice in panel regression analyses, the moderator effect of macro-level characteristics can be estimated also in fixed effects models by means of cross-level interaction effects. Despite the advantages of the fixed effects approach, it is rarely used for the analysis of cross-national data.In this paper, I compare the fixed effects approach with conventional multilevel regression models and give practical examples using data of the International Social Survey Programme (ISSP) from 2006. As it turns out, the results of both approaches regarding the effect of cross-level interactions are similar. Thus, fixed effects models can be used either as an alternative to multilevel regression models or to assess the robustness of multilevel results.

scholarly journals The Effects of Omitted Variable on Multicollinearity in Hierarchical Linear Modelling

2021 ◽  
pp. 1-13
Author(s):  
V. G. Jemilohun
Keyword(s):  
Linear Model ◽  
Hierarchical Linear Model ◽  
Variance Inflation Factor ◽  
Variable Model ◽  
Data Set ◽  
Omitted Variable Bias ◽  
Correct Form ◽  
Inflation Factor ◽  
Variable Bias ◽  
The Impact

This study investigates the impact of violation of the assumption of the hierarchical linear model where covariate of level – 1 collinear with the correct functional and omitted variable model. This was carried out via Monte Carlo simulation. In an attempt to achieve this omitted variable bias was introduced. The study considers the multicollinearity effects when the models are in the correct form and when they are not in the correct form.  Also, multicollinearity test was carried out on the data set to find out whether there is presence of multicollinearity among the data set using Variance Inflation Factor (VIF).  At the end of the study, the result shows that, omitted variable has tremendous impact on hierarchical linear model.

scholarly journals Role of human capital and foreign direct investment in promoting economic growth

2015 ◽  
Vol 42 (2) ◽  
pp. 98-111 ◽  
Author(s):  
Muhammad Azam ◽  
Ather Maqsood Ahmed
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Foreign Direct Investment ◽  
Random Effects ◽  
Direct Investment ◽  
Fixed Effects ◽  
Set Covering ◽  
Data Set ◽  
Content Type ◽  
Education And Health

Purpose – The purpose of this paper is to validate the Endogenous Growth Model by examining the impacts of Human Capital (HK) and Foreign Direct Investment (FDI) on economic growth in ten countries from Commonwealth of Independent States (CIS). Design/methodology/approach – For empirical investigation, a linear regression model based on growth theory and panel data set covering the time-period from 1993 to 2011 are used. Fixed and random effects models are applied. On the basis of the Hausman test, the fixed effects model has been preferred over the random effects model. Findings – The results support the hypothesis of the study by confirming that HK development is critical for economic growth. Similarly, FDI has been found to have a facilitating role in promoting growth in the former Soviet Republics now comprising Central Asian independent economies. This is despite of the fact that there are country-specific differences across CIS. Practical implications – The findings suggest that investment climate in the host countries must be enriched through suitable policies. Improved domestic conditions not only enhance the performance of multinational corporations but also allow host economies to reap greater benefits of FDI inflows. Moreover, the findings demonstrate that investment in both education and health are indispensable. Therefore, improved levels of education and health should be the primary objective running concurrently with other factors in order to stimulate economic growth. Originality/value – The choice of CIS has been made because very little research has been found for the region particularly in the area of economic growth despite strong evidence of commonality in terms of landlocked geographical layout and economic and political structures of these economies. The region has gained importance gradually after independence of these states; and it has started to attract foreign funds in the shape of FDI only recently. Thus, there is a need to evaluate the future prospects pertaining to the importance of FDI and HK on growth performance of these economies and will insistently contribute to the literature.

Sign in / Sign up

Export Citation Format

Share Document