Start of Term message from Head of the Department

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Department News

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Economics – 3rd in the Good University Guide 2019

We are delighted to announce that Economics has been ranked 3rd in the Good University Guide 2019, published by the Times and Sunday Times in September 2018. We are particularly pleased to see high scores in the area of graduate prospects (92.8%) and an overall score of 99.3% with only Oxford and Cambridge having higher scores (99.5% and 100% respectively). The guide ranks Warwick 10th overall and 8th for the quality of research. You can find out more here.

Reimbursement scheme for EU employees

The University of Warwick has announced its intention to cover the cost of the UK settlement fee for its EU employees, their partners and dependants. The University has announced its intention to cover the cost of the UK settlement fee for its EU employees, their partners and dependants. The Home Office has stated that an on-line application system will be accessible to all by March 2019. Once individuals have successfully applied for permanent residency, and have been notified of their status, Warwick will reimburse the application fee. Please click on the link below for additional information. Further details of the Warwick reimbursement process will follow in due course.

Welcome Week

We wanted to send a huge thank you for all your hard work in delivering events and activities for Welcome Week. As this was the first year we have introduced a Welcome Week, the Welcome Team have now invited Departments to submit feedback of how we thought Welcome Week went, to learn lessons for 2019. If you have any ideas or feedback, please contact Welcome Representatives; Elizabeth Jones or Charlotte White or complete this short staff survey. Focus groups will be held with students later this month.

Help required at 'Meet our Staff Drop-in' at next Open Day

Our next Open Day will take place on Saturday 20 October. To make help make these really successful events, we are hoping to have around 10 academic staff members to assist at each Departmental Drop-In session to meet with prospective students and their parents and to answer their questions about Warwick and our undergraduate degree programme courses. If you are a little nervous about this there will be guidance on answering prospective student questions will be provided in advance, along with a detailed FAQ document. If you are available to help, please email Charlotte (charlotte.white@warwick.ac.uk) giving her the times that you are available.

Open Day Summary

On 6 October, we welcomed approx 1,300 prospective students with their parents at our Economics talks and Drop-in sessions at the Open Day. A number of talks were delivered that focused on why study Economics (Thiemo Fetzer), Economics Programmes at Warwick and Admissions (Christian Soegaard) and Careers & Skills in Economics (Stephanie Redding) and ended with a question and answer session by Professor Robin Naylor. Prospective students and their parents also had a chance to talk to current Economics students and find out about social and internship opportunities offered by three student societies: Economics Society and Economics Summit.

Thank you to those members of staff who participated and assissted at the Open Day. These events are a value conversion opportunity to promote the academic excellence of the Department and its reputation as one of the top Economic Departments in the UK.

CAGE Advantage Magazine - Autumn Issue

The Autumn edition of the research magazine by the Centre for Competitive Advantage in the Global Economy (CAGE) has been released and features a diversity of themes which reflects the breadth and depth of research undertaken by researchers at CAGE. You can access the online PDF version here.

Autumn Term - Staff Buffet Lunch

In the Autumn Term, Staff Buffet Lunch will take place on a Thursday in weeks 1, 2, 4, 6, 8 and 10. Room S2.79, 12.30pm-1.30pm. PhD and MRes Students will be invited to join in Weeks 2 & 10.

Running Club at Economics

Interesting in stretching your legs once or twice a week? Members of the Department have been regularly running every Monday and Thursday at 12:30pm completing a 5k run around the campus. If you would like join them, email Neil Gatty (N.J.Gatty@warwick.ac.uk). They welcome all runners of all abilities.

Publications, Presentations, Talks & Awards

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Carlo Perroni's paper 'Does Market Size Matter for Charities?' is forthcoming in the Journal of Public Economics. This is joint work with S.Lapointe, K. Scharf and J. Tukiainen.

Abstract: We analyse implications of market size for market structure in the charity sector. While a standard model of oligopolistic for-profit competition predicts a positive relationship between market size and firm size, our analogous model of competition between pro-socially motivated charities predicts no such correlation. If charities are biased towards their own provision, a positive association between market size and provider size can arise. We examine these predictions empirically for six different local charity markets. Our empirical findings suggest that charities do not solely pursue prosocial objectives, and that increased competition in the charity sector can lead to rationalisation in provision.

Carlo Perroni's paper 'Are Donors Afraid of Core Costs? Economies of Scale and Contestability in Charity Markets' is forthcoming in the Economic Journal. This is joint work with G. Pogrebna, S. Sandford and K. Scharf.

Abstract: We study contestability in charity markets where non-commercial, not-for-profit providers supply a homogeneous collective good through increasing-returns-to-scale technologies. Unlike in the case of for-profit competition, the absence of price-based sales contracts for charities means that fixed costs can translate into entry barriers, protecting the position of an inefficient incumbent; or, conversely, they can make it possible for inefficient newcomers to contest the position of a more efficient incumbent. Evidence from laboratory experiments shows that fixed cost driven trade-offs between payoff dominance and perceived risk can lead to inefficient technology adoption.

Carlo Perroni's paper 'Energy Subsidies and Policy Commitment in Political Equilibrium" has been published in the Energy Economics, Vol. 71, March 2018. This is joint work with M. Pani.

Abstract: Because non-renewable energy subsidies affect incentives for investing in energy-saving technologies, they entail a classic investment hold-up problem: once investment has taken place, policymakers will tend to overuse them for distributional reasons, which will in turn depress investment by forward-looking agents. Reforming energy subsidies thus requires overcoming a policy commitment problem. In this paper we show that, even when commitment is feasible, it may fail to materialize in a political equilibrium due to politicians’ re-election incentives. In particular, it will be those politicians who are comparatively less favorable to energy subsidies who may fail to commit to phase them out.

Mark Harrison's book 'The Soviet economy and the approach of war, 1937-1939' (with R. W. Davies, Oleg Khlevniuk, and S. G. Wheatcroft), the seventh and final volume of the series The Industrialisation of Soviet Russia, was published by Palgrave over the summer. Mark wrote about the book on the Palgrave website and discussed it with Stephen Wheatcroft on the New Books Network.

Abstract: This book concludes The Industrialisation of Soviet Russia, an authoritative account of the Soviet Union’s industrial transformation between 1929 and 1939. The volume before this one covered the ‘good years’ (in economic terms) of 1934 to 1936. The present volume has a darker tone: beginning from the Great Terror, it ends with the Hitler-Stalin pact and the outbreak of World War II in Europe. During that time, Soviet society was repeatedly mobilised against internal and external enemies, and the economy provided one of the main arenas for the struggle. This was expressed in waves of repression, intensive rearmament, the increased regimentation of the workforce and the widespread use of forced labour.

Mark Harrison also gave a lecture “Born in 1918: The Soviet economy, its life and afterlife,” in the Political Economy Project series at Dartmouth College, Hanover, NH on 27 September.

Liliana Varela presented her paper 'Exchange Rate Exposure and Firm Dynamics' in a seminar at the University of Mannheim on 18 September. She also presented the same paper at the "Rochester Conference in Macro and International Economics" on 28 September.

Dennis Novy's paper "Market Potential and Global Growth over the Long Twentieth Century", joint with David Jacks was published in the Journal of International Economics114, September 2018, pp. 221-237.

Victor Lavy's paper “Maimonides Rule Redux”, NBER Working Paper No. 23486, June 2017 is forthcoming in the American Economic Review: Insights. This is joint work with Angrist D. Joshua, Jetson Leder-Luis, Adi Shany.

Abstract: We use Maimonides Rule as an instrument for class size in large Israeli samples from 2002-2011. In contrast with Angrist and Lavy (1999), newer estimates show no evidence of class size effects. The new data also reveal enrollment manipulation near Maimonides cutoffs. A modified rule that uses birthdays to impute enrollment circumvents manipulation while still generating precisely estimated zeros. In both old and new data, Maimonides Rule is unrelated
to socioeconomic characteristics conditional on a few controls. Enrollment manipulation therefore appears to be innocuous. We briefly discuss possible explanations for the change in class size effects since the early 1990s.

Victor Lavy's paper "Expanding School Resources and Increasing Time on Task: Effects of a Policy Experiment in Israel on Student Academic Achievement and Behavior”, is forthcoming in the Journal of the European Economic Association.

Abstract: This paper uses a natural experiment in Israel to assess the impact of school teaching resources and how it is used, ‘time-on-task’, on academic achievements and non-cognitive outcomes. It exploits variation induced by a change in the funding formula that reduced instructional resources funding for some schools and increased them for others. The results suggest that increased school resources and students' spending more time at school and on key tasks all lead to increased academic achievements with no behavioral costs. Separate estimations of the effect of increasing subject-specific instructional time per week also show positive and significant effects on math, science, and English test scores and small and non-significant effects on Hebrew test scores. However, there are no cross effects of additional instructional time across subjects. This evidence is robust to using different identification strategies. The evidence also shows that a longer school week increases the time that students spend on homework without reducing social and school satisfaction and without increasing school violence.

Roland Rathelot presented his paper "On the Road Again? Gender differentials in reservation utility, wage and commuting distance." (joint with Thomas Le Barbanchon and Alexandra Roulet) at the CEPR-IZA Annual Symposium in Labour Economics on 21 September.

Daniel Sgroi presented “The Effect of Positive Mood on Repeated Interaction” at the European Economic Association Conference (Cologne, Germany) and his co-authored paper "When Good Advice is Ignored: The Role of Envy and Stubbornness" was also presented at the same conference.

Daniel Sgroi presented “Historical Analysis of National Subjective Well-being using Millions of Books” at the Econometric Society European Meeting (Cologne, Germany).

Arun Advani presented "Informal Insurance and Poverty Traps" at European Economic Association in Cologne on 29 August 2018.

Arun presented "The Dynamic Effects of Tax Audits" at the International Institute of Public Finance in Tampere on 23 August 2018, at Econometric Society European Meetings in Cologne on 30 August 2018 and at MaTax, ZEW in Mannheim on 04 October 2018.

Arun also conducted a policy presentation on "Tax compliance and the magic money tree" at the Labour Party Conference on 25 September 2018 and at the Conservative Party Conference on 02 October 2018.

Working Papers

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Andy Ferrrara's new working paper 'World War II and African American Socioeconomic Progress' has been released as part of the CAGE working paper series.

Media Coverage

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Mark Harrison’s column, “Europe’s Unsettled Debts,” appeared in the BBC History Magazine (November 2018) as part of a supplement 100 years after the 1918 Armistice.

“Happiness and Productivity” (Andrew Oswald, Eugenio Proto and Daniel Sgroi published in the Journal of Labor Economics in 2015) continues to attract media attention with over 30 different newspapers and media sites discussing the paper over the summer including Business Insider, Forbes, the NZ Herald, Business Scoop, Daily Business Group, Fortune, Yahoo, the Morning Star, and the Metro. It is also 2nd in the top 3 “most read articles” within the last 12 months on the Journal of Labor Economics website, despite now being 3 years old.

Department Diary

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