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Income Shocks and Ethnic Group Bias
Hruban, Jiří ; Bauer, Michal (advisor) ; Horváth, Roman (referee)
Diploma Thesis Abstract JEL Classification Z13, O12, O13, Z91 Keywords income shock, endogeneity, ethnicity, instrumental variables Title Income Shocks and Ethnic Group Bias Author's e-mail 61618416@fsv.cuni.cz Supervisor's e-mail bauerm@fsv.cuni.cz Abstract The thesis explores how individual income shocks impact ethnic group bias using a survey dataset from Uganda and meteorological data. Previous research has shown that the majority of civil conflicts break down along ethnic lines, and that ethnic tribalism harms economic performance of countries. A better understanding of the causal mechanism behind ethnic bias could help alleviate both of those problems. The author finds that income shocks have no measurable effect on ethnic out-group bias, but they might influence ethnic in-group bias. Since the regression of ethnic bias variables on income proxies likely suffers from endogeneity, the author employs the copula endogeneity correction model, which, however, does not prove to perform well with a binary dependent variable. In addition, the author demonstrates that ethnic group bias is most likely not directly influenced by variations in rainfall and that instrumenting for income with rainfall variation leads to non- robust results with even a small violations of model assumptions.
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Effects of human capital in developing countries
Mouček, Jan ; Chytilová, Julie (advisor) ; Korbel, Václav (referee)
Effects of human capital in developing countries Bc. Jan Mouček Abstract Improving education and health of people living in developing countries is an often discussed topic. We however know relatively little about the effects that investments into schooling and improving the nutrition and hygiene of people in those countries have on their productivity at work. This thesis investigates the effects of four variables representing investment into human capital on income of individuals from Bangladesh and Indonesia. The four studied variables are education, migration, height and Body Mass Index. The thesis aims at comparing results of estimation using instrumental variables estimator with previous similar research. It tries to observe possible differences in size of effects the human capital variables have. It finds however that the instrumental variables used are of insufficient quality for the estimation to yield reliable results. Because the instruments used were almost the same as in underlying works and their quality has not been previously tested the conclusion of this thesis is that further search for correct instrumental variables describing the human capital variables in various countries around the globe is necessary.
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The effect of the oil price shock in 1973 on the real GDP of the United states
Dobrovolný, David ; Stroukal, Dominik (advisor) ; Chytilová, Helena (referee)
The goal of this paper is to analyze the effect of the oil price shock in 1973 on the real GDP of the United states. Theoretical part includes existing results of other works that also analysed the relationship and shows detailed outlook at the oil shocks issue. I verify the issue using two methods: fixed effects model using ordinary least squares and instrumental variables. Based on the results of my analysis I deny hypothesis that oil price supply shock in 1973 had statistically significant effect on the real GDP of the United states. Thus, conclusion of this paper presumes that oil price shock in 1973 was not responsible for the crisis that emerged in the United states right after the oil embargo.
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Does The Impact of Immigration on Occupational Specialisation differ in Recession and Expansion in European Union?
Polonyankina, Tatiana ; Zouhar, Jan (advisor) ; Dlouhá, Zuzana (referee)
The thesis tests whether the impact of immigration on native workers differs depending on the business cycle. Previous studies proved that labour mobility and the effect of immigration differs with respect to the business cycle. For the expansionary years was found a sizable relocation of native workers to occupations with more interactive rather than manual content as a response to immigration. This is no longer the case for economy in recession period. However, there is null impact on native employment that does not change with the business cycle. The results were found for Spanish labour market and the conclusions about the employment all were found also for American labour market. The European labour market has been studied just in the period before crisis. Following the study about Spanish task specialization we would like to see if there is any change of impact of immigration on native task specialization in European Union. We split the data on the time period of expansion and the time period of economic crisis using the European Labour Force Survey. We would like to examine the effect of immigration on task specialization of natives on three groups of countries, West Europe, Germany and Middle and East Europe.
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Empirical Testing of the New Keynesian Phillips Curve in the Czech Republic
Plašil, Miroslav ; Arlt, Josef (advisor) ; Pánková, Václava (referee) ; Komárek, Luboš (referee)
New keynesian Phillips curve (NKPC) has become a central model to study the relation between inflation and real economic activity, notably in the framework of optimal monetary policy design. However, some recent evidence suggests that empirical data are usually at odds with the underlying theory. The model due to its inherent structure represents a statistical challenge in its own right. Since Galí and Gertler (1999) published their seminal paper introducing estimation via GMM techniques, they have triggered a heated debate on its empirical relevance. Their approach has been heavily criticised by later authors, mainly on the grounds of questionable behaviour of GMM estimator in the NKPC context and/or its small sample properties. The common criticism includes sensitivity to the choice of instrument set, weak identification and small sample bias. In this thesis I propose a new estimation strategy that provides a remedy to above mentioned shortcomings and allows to obtain reliable estimates. The procedure exploits recent advances in GMM theory as well as in other fields of statistics, in particular in the area of time series factor analysis and bootstrap. The proposed estimation strategy consists of several consecutive steps: first, to reduce a small sample bias resulting from excessive use of instruments I summarize all available information by employing factor analysis and include estimated factors into information set. In the second step I use statistical information criteria to select optimal instruments and eventually I obtain confidence intervals on parameters using bootstrap method. In NKPC context all these methods were used for the first time and can also be used independently. Their combination however provides synergistic effect that helps to improve the properties of estimates and to check the efficiency of given steps. Obtained results suggest that NKPC model can explain Czech inflation dynamics fairly well and provide some support for underlying theory. Among other things the results imply that the policy of disinflation may not be as costly with respect to a loss in aggregate product as earlier versions of Phillips curve would indicate. However, finding a good proxy for real economic activity has proved to be a difficult task. In particular we demonstrated that results are conditional on how the measure is calculated, some measures even showed countercyclical behaviour. This issue -- in the thesis discussed only in passing -- is a subject of future research. In addition to the proposed strategy and provided parameter estimates the thesis brings some partial simulation-based findings. Simulations elaborate on earlier literature on naive bootstrap in GMM context and study performance of bootstrap modifications of unit root and KPSS test.
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