Alumni Dissertations and Theses

 
 

Alumni Dissertations and Theses

Filter Dissertations and Theses By:

 
 
  • Pharmaceutical Innovation and Infant Health: Palivizumab and RSV in California

    Author:
    Ryan Conrad
    Year of Dissertation:
    2010
    Program:
    Economics
    Advisor:
    Theodore Joyce
    Abstract:

    The respiratory syncytial virus (RSV) is the leading cause of bronchiolitis and other lower respiratory diseases in infants and is also the foremost cause of hospitalizations of infants younger than one year of age. In 1998 palivizumab was approved, a drug designed to provide passive immunity against the virus for infants who have risk factors making them especially susceptible to severe RSV infections. Although the drug can never increase the likelihood of a severe RSV infection, infants who are born with well developed respiratory and immune systems receive no additional benefit from the drug, and because of the high price of the drug, with a full treatment regimen costing over $5,000 per infant, the American Academy of Pediatrics (AAP) releases policy statements outlining which risk factors should be considered when determining if an infant will benefit from the application of palivizumab. This analysis uses the California Linked Birth and Inpatient Database to identify infants who are at risk for a severe RSV infection and who will benefit from the use of palivizumab, and examines subsequent admission records for the presence of RSV admissions. The empirical models used are based on the difference-in-differences framework and rely on the identification of specific risk factors that are present at birth. It is found that there were likely minimal improvements of infant health outcomes immediately after the introduction of the drug, although in 2002 and thereafter there are reductions in the RSV admission rate that can be attributed to the use of palivizumab. The results also show that there were little if any reductions in inpatient charges. Analysis is also conducted to establish how total RSV related spending, which includes both inpatient charges associated with RSV admissions and spending on palivizumab, varies with compliance rates. It is shown that high compliance rates result in utility maximizing outcomes when AAP guidelines are closely followed.

  • The Effect of the Sarbanes-Oxley Act of 2002 on Corporate Governance

    Author:
    Iliana Dimitrova
    Year of Dissertation:
    2010
    Program:
    Economics
    Advisor:
    Devra Golbe
    Abstract:

    The Sarbanes-Oxley Act of 2002 (SOX) introduced strict governance rules for public companies in the US to prevent diversion of resources by corporate insiders. Another governance mechanism that serves to align the interests of managers and directors of the firm with outside shareholders is ownership structure as discussed in Chapter 1. The equity structure of dual-class firms is characterized by multiple classes of shares with differential voting rights, which allows insiders to hold disproportionate dividend and voting rights. Dual-class status may serve as a protection from value-reducing takeovers and help the realization of growth options. At the same time, since managerial cash-flow rights have an incentive alignment effect, while voting control reduces the discipline of the market for corporate control, dual-class firms may protect large private benefits of insiders. Chapter 2 evaluates the effect of SOX on incentive alignment between managers and shareholders. The value-increasing effect of managerial cash-flow rights is expected to be smaller in magnitude after SOX. Similarly, the negative effect of voting control should be less pronounced after SOX. Using dual-class firms, these effects can be separately estimated in a panel data model. Results indicate a smaller positive effect of cash-flow rights which is evidence that the governance provisions of SOX improve managerial incentive alignment. Chapter 3 analyses differences in returns on inferior and superior shares of dual-class firms, which are expected to reflect reduced value of voting control after SOX. The market models in the event study methodology account for non-synchronous trading due to thin market in the superior shares. There is no evidence of improved performance of inferior shares vs. superior shares in the market's expectations around key SOX dates. Insiders would value control less if SOX limits private benefits of control and may want to divest their holdings by recapitalizing into single-class. At the same time, if dual-class status is beneficial to outside shareholders, the new rules would reduce the cost in terms of diversion of resources. Chapter 4 empirically tests the effect of SOX on recapitalization decisions of dual-class firms into single-class by formulating a survival model. Results indicate that the propensity of firms to recapitalize into single class is significantly higher after the passage of the Act.

  • The Effect of the Sarbanes-Oxley Act of 2002 on Corporate Governance

    Author:
    Iliana Dimitrova
    Year of Dissertation:
    2010
    Program:
    Economics
    Advisor:
    Devra Golbe
    Abstract:

    The Sarbanes-Oxley Act of 2002 (SOX) introduced strict governance rules for public companies in the US to prevent diversion of resources by corporate insiders. Another governance mechanism that serves to align the interests of managers and directors of the firm with outside shareholders is ownership structure as discussed in Chapter 1. The equity structure of dual-class firms is characterized by multiple classes of shares with differential voting rights, which allows insiders to hold disproportionate dividend and voting rights. Dual-class status may serve as a protection from value-reducing takeovers and help the realization of growth options. At the same time, since managerial cash-flow rights have an incentive alignment effect, while voting control reduces the discipline of the market for corporate control, dual-class firms may protect large private benefits of insiders. Chapter 2 evaluates the effect of SOX on incentive alignment between managers and shareholders. The value-increasing effect of managerial cash-flow rights is expected to be smaller in magnitude after SOX. Similarly, the negative effect of voting control should be less pronounced after SOX. Using dual-class firms, these effects can be separately estimated in a panel data model. Results indicate a smaller positive effect of cash-flow rights which is evidence that the governance provisions of SOX improve managerial incentive alignment. Chapter 3 analyses differences in returns on inferior and superior shares of dual-class firms, which are expected to reflect reduced value of voting control after SOX. The market models in the event study methodology account for non-synchronous trading due to thin market in the superior shares. There is no evidence of improved performance of inferior shares vs. superior shares in the market's expectations around key SOX dates. Insiders would value control less if SOX limits private benefits of control and may want to divest their holdings by recapitalizing into single-class. At the same time, if dual-class status is beneficial to outside shareholders, the new rules would reduce the cost in terms of diversion of resources. Chapter 4 empirically tests the effect of SOX on recapitalization decisions of dual-class firms into single-class by formulating a survival model. Results indicate that the propensity of firms to recapitalize into single class is significantly higher after the passage of the Act.

  • Essays on Economic Policy: Income Inequality and Health Insurance

    Author:
    Eric Doviak
    Year of Dissertation:
    2010
    Program:
    Economics
    Advisor:
    John Devereux
    Abstract:

    This dissertation contains economic analyses of two critical social issues facing the United States at the dawn of the 21st century: income inequality and the affordability of health insurance. The chapter on income inequality uses the Solow Model of economic growth to model the evolution of inequality over time. In steady state, differences in household saving rates generate differences in household capital income. Households that save more accumulate more capital and have higher steady-state income. Tax policy affects the distribution of income through its influence on household saving rates. Increasing the tax rate on labor income causes a greater percentage decrease in the steady-state saving rates of relatively low savers, thus increasing pre-tax income inequality. Conversely, increasing the tax rate on capital income reduces pre-tax income inequality because it causes a greater percentage decrease in the steady-state saving rates of relatively high savers. Empirical tests of the model using data from the March Current Population Survey and NBER's TAXSIM model suggest that higher taxes on wage income are associated with higher levels of income inequality. A high degree of correlation among the average marginal tax rates prevents us from drawing inferences about the effect that taxation of capital income has on inequality. The chapter on health insurance examines states' efforts to make health insurance more accessible and affordable to small employers by restricting insurers' ability to set premium rates on the basis of health status and other factors which predict a group's future medical needs. The chapter presents evidence that rating restrictions reduce health insurance coverage rates and increase market concentration in the insurance industry. From the perspective of a public policymaker however, such reforms may still be desirable if they increase the ability of less healthy individuals to obtain and afford health insurance coverage.

  • The trading Efficiency on Options Market: Essays on stock options market

    Author:
    Yan Feng
    Year of Dissertation:
    2013
    Program:
    Economics
    Advisor:
    Yan Feng
    Abstract:

    THE TRADING EFFICIENCY ON OPTIONS MARKET: ESSAYS ON STOCK OPTIONS MARKET By Yan Feng Advisor: Professor Christos Giannikos F. Black (1975) in his seminal paper "Fact and Fantasy in the use of options" mentioned a number of fantasies that widely spread in the options markets. Since Black's (1975) paper was published, there were significant changes and innovations in the options markets. The purpose of this paper is to address some of the pricing and trading aspects in the options markets. The first paper studies the impact of option liquidity on the level of implied volatility function for equity and stock index options. Option liquidity is measured by percentage bid-ask spread, option trading volume and open interest. The study finds a significant negative effect of percentage bid-ask spread on implied volatility level, as well as positive effect of trading volume and open interest on implied volatility level. After adjusting for the underlying asset's total risk, the option percentage spread still has significant negative effect on the level of option excessive volatility. Among several firm specific variables, beta coefficient and systematic risk proportion have significant effects on the slope of excessive implied volatility function. The Fama-MacBeth regressions are used to test the hypotheses for eight moneyness categories separately. This paper explains the implied volatility function from the viewpoint of option market efficiency, and proves that the illiquidity premium documented in stock and bond market is also significant in stock options market. In The second paper, risk-neutral Skewness derived from stock options market is used to test the information role of options price in predicting stock returns after earnings announcements. The result shows that risk-neutral skewness before earnings announcement day contains information about stock returns during earnings announcement period. Less negative options risk-neutral skewness and the positive change of skewness predict higher abnormal return after earnings announcement. In addition, it is the individual risk-neural skewness and idiosyncratic risk that play more important role in predicting the abnormal return.

  • Essays on Globalization, Skills and Development

    Author:
    Emiko Fukase
    Year of Dissertation:
    2011
    Program:
    Economics
    Advisor:
    Wim Vijverberg
    Abstract:

    This dissertation examines how globalization, defined as increase in trade or Foreign Direct Investment (FDI), influences development in terms of economic growth and labor market effects. It also studies the role of human capital in affecting economic development both directly and interacting with globalization variables. The dissertation consists of four chapters: one macroeconomic study that revisits the impacts of globalization and education on economic growth (Chapter 1) and three micro-level case studies on Vietnam's labor market. One micro paper explores the impacts of FDI on wages (Chapter 2), another investigates the impacts of FDI on internal migration (Chapter 3), and the final study explores the effects of export liberalization on Vietnam's skill premium (Chapter 4). The dissertation's findings broadly support the view that globalization can be an "engine of growth", but its mechanisms are complex. One insight from the macro study is a positive impact of trade and FDI on capital formation on average in developing countries. The micro studies for the case of Vietnam suggest that the labor market is another channel through which globalization may bring growth where it spurs employment, raises wages and brings about interregional labor migration. The macro study also reveals a strong and positive direct impact of education on economic growth, which in turn is consistent with the results of the micro studies. The dissertation provides evidence that globalization and skill variables interact in ways that vary depending on different channels and specific episodes of trade liberalization. For instance, whereas foreign firms generally pay higher foreign wage premiums for better educated workers, they also play a role in raising wages of less skilled women relative to alternative jobs in the informal wage sector. In the aftermath of the U.S.-Vietnam Bilateral Trade Agreement, Vietnam's provinces which are more exposed to the increase in export opportunities experienced a larger wage growth for unskilled workers and a decline of the skill premium relative to the other provinces. However, as Vietnam's economy-wide skill premium increased during the period studied, the latter effect appeared to have mitigated but did not outweigh the other effects which raised the skill premium.

  • ESTIMATION OF AN EMPIRICAL FAVAR MODEL AND DSGE MODEL FOR EVALUATING EFFECTS OF GOVERNMENT SPENDING IN JAPAN

    Author:
    Kohei Fukawa
    Year of Dissertation:
    2012
    Program:
    Economics
    Advisor:
    Thom Thurston
    Abstract:

    This paper studies the effects of government spending on the economy through estimation of an empirical Factor Augmented Vector Autoregression (FAVAR) model and a theoretical DSGE model. We first conducted FAVAR using data for 107 time series from Japan, and found that an increase in government investment and consumption leads to an increase in private consumption and real wages. We then constructed a New Keynesian (NK) general equilibrium model with real and nominal rigidities, including Edgeworth complementarity/substitutability between private and government consumption and productive public capital. The model extends the Bouakez and Rebei (2007) model in three dimensions: constructing an NK model, including intertemporal investment adjustment cost and variable capital utilization as real rigidities, and introducing public capital stocks as an externality to the production function of intermediate goods firms. Our model succeeds in explaining private consumption and real wages increase in response to government expenditure shocks. We estimate key parameters of the model using Bayesian inference and show that private and government consumption are Edgeworth complements and marginal productivity of public capital is productive in Japan.

  • A R&D Based Real Business Cycle Model

    Author:
    Ka Wai Terence Fung
    Year of Dissertation:
    2011
    Program:
    Economics
    Advisor:
    Jonathan Conning
    Abstract:

    The New Keynesian Real Business Cycle model with staggered price adjustment is augmented with a R&D producing sector. Two sources of economic shocks are separately considered, namely random paricipation (perturbances to value of alternative investment opportunities in another sector) and financial intermediation (shocks to the cost of raising capital in the financial intermediation market). We find that, when comparing to the baseline model, both random participation and financial intermediation models can explain pro-cyclical R&D spending. Additionally the investment oversensitivity problem is corrected. However, only the financial intermediation model is consistent with the observed finding that the volatility of R&D is larger than that of investment and output.

  • A R&D Based Real Business Cycle Model

    Author:
    Ka Wai Terence Fung
    Year of Dissertation:
    2011
    Program:
    Economics
    Advisor:
    Jonathan Conning
    Abstract:

    The New Keynesian Real Business Cycle model with staggered price adjustment is augmented with a R&D producing sector. Two sources of economic shocks are separately considered, namely random paricipation (perturbances to value of alternative investment opportunities in another sector) and financial intermediation (shocks to the cost of raising capital in the financial intermediation market). We find that, when comparing to the baseline model, both random participation and financial intermediation models can explain pro-cyclical R&D spending. Additionally the investment oversensitivity problem is corrected. However, only the financial intermediation model is consistent with the observed finding that the volatility of R&D is larger than that of investment and output.

  • FISCAL DECENTRALIZATION: DOES THE SOURCE OF REVENUE MATTER?

    Author:
    Pallavi Govil
    Year of Dissertation:
    2014
    Program:
    Economics
    Advisor:
    Timothy Goodspeed
    Abstract:

    Abstract Fiscal Decentralization: does the Source of Revenue Matter? Evidence from Rural India Pallavi Jain Govil Adviser: Professor Timothy J. Goodspeed Is the pattern of expenditures of village governments related to their sources of revenue? Do village governments use own-source revenues more efficiently than transfer grants to provide public services to their constituents? This paper begins with the premise that local governments are more participative, more acceptable, and more accountable and hence, deliver better. I use a policy change introduced in 1997 in province of Madhya Pradesh in India, whereby the power to collect royalty and lease rents on minor mineral mines and fishing tanks was transferred to village governments, as a natural experiment and examine whether expenditure patterns of villages that received such resources differ from those that did not. I find that village governments choose to spend their fiscal resources differently depending on where the money comes from, even if these resources are completely `untied' and could be spent entirely at the discretion of the village governments. I also compare the social outcomes in villages that gained such additional resources to those that didn't, and thus remained more dependent on transfer grants from the state and central government for their development needs. Using village level data, I find evidence to support the hypothesis that fiscal decentralization through assignment of taxation powers is more effective in achieving desired outcomes as compared to a transfer of an equal amount of resources by way of grants.