Now showing 1 - 10 of 43
  • Publication
    Hops, Skip & a Jump: The Regional Uniqueness of Beer Styles
    (University College Dublin. School of Economics, 2020-12) ; ; ;
    Perhaps more than any other product, beer evokes the place it was made. Weißbier and Germany, dubbels and Belgium, and most of all, Guinness and Ireland. Part of what makes these beers so memorable is what sets them apart and gives them their ‘taste of place’. Many studies have tried to place that taste, and due to a lack of detailed data, have relied largely on qualitative methods to do so. We introduce a novel data set of regionalized beer recipes, styles, and ingredients collected from a homebrewing website. We then turn to the methods of evolutionary economic geography to create regional ingredient networks for recipes within a style of beer, and identify which ingredients are most important to certain styles. Along with identifying these keystone ingredients, we calculate a style’s resiliency or reliance on one particular ingredient. We compare this resiliency within similar styles in different regions and across different styles in the same region to isolate the effects of region on ingredient choice. We find that while almost all beer styles have only a handful of key ingredients, some styles are more resilient than others due to readily available substitute ingredients in their region.
  • Publication
    The Impact of Special Economic Zones on Exporting Behavior
    (University College Dublin. School of Economics, 2015-11) ;
    Using firm level data from Africa and Asia, we estimate the impact of being in a special economic zone (SEZ) on a firm’s probability of exporting, export intensity, and value of exports. At the extensive margin, we find that SEZ firms in open economies are 25% more likely to export than their non-SEZ counterparts, with a large negative effect in closed economies. At the intensive margin, we find that SEZs increase the value of exports, but only in countries with barriers to imports where the estimate increase is 3.6%. Thus, the estimated effect of introducing an SEZ can be meaningful, but is heavily contingent on the local economic environment.
  • Publication
    The Heterogeneous Impact of Brexit: Early Indications from the FTSE
    (University College Dublin. School of Economics, 2017-05) ;
    The UK's decision to leave the EU is surrounded by several studies simulating its potential effects. Alternatively, we examine expectations embodied in stock returns using a two-part estimation process. While most firms' prices fell, there was considerable heterogeneity in their relative changes. We show that this heterogeneity can be explained by the firm's global value chain, with heavily European firms doing relatively worse. For firms with few imported intermediates, this was partially offset by a greater Sterling depreciation. These changes were primarily in the first two days and highly persistent. Understanding these movements gives a better understanding Brexit's potential effects.
  • Publication
    The Impact of Taxes on the Extensive and Intensive Margins of FDI
    (University College Dublin. School of Economics, 2016-08) ; ;
    The design of optimal tax policy, especially with respect to attracting FDI, hinges on whether taxes affect multinational firms at the extensive or the intensive margins. Nevertheless, the literature has not yet explored the simultaneous impact of taxation on FDI on these two margins. Using firm-level cross-border investments into Europe during 2004-2013, we do so with a Heckman two-step estimator, an approach which also allows us to endogenize the number of investments and include home country and parent firm characteristics. We find that taxes affect both margins, particularly for firms that invest only once, with 92 percent of tax-induced changes in aggregate inbound FDI driven by movements at the extensive margin. In addition, we find significant effects of both home country and parent firm characteristics, pointing towards the granularity of investment decisions.
  • Publication
    The Impact of Everything But Arms on EU Relative Labour Demand
    (University College Dublin. School of Economics, 2016-09) ;
    The Everything But Arms agreement, introduced by the EU in 2001, eliminated duties on most imports from the least developed countries. To avail of these benefits, however, the exported product must contain a sufficiently large share of local content. Thus, the agreement may have affected both the quantity and the factor content of exports from the least developed countries to the EU. Using a panel of sector-level data across countries, our estimates suggest that, contrary to expectations, the agreement may have increased the skill-content of these exports, benefitting the lowest-skilled EU workers at the expense of their highest-skilled counterparts. This result, however, is entirely driven by textile trade; when omitting this industry, we find no significant effects. This suggests that the EBA may have led to the local provision of higher-skill inputs in the textile industry.
  • Publication
    Competition in Taxes and IPR
    (University College Dublin. School of Economics, 2020-06) ; ; ;
    We examine competition for foreign direct investment when governments compete in tax incentives along with intellectual property rights (IRPs) protection. Higher IPRs result in a lower probability of the multinational enterprise (MNE) being imitated and thus higher expected profits and tax revenues, all else equal. We show that, from the perspective of competing hosts, equilibrium IPRs are too high while taxes are too low. Coordination between jurisdictions can therefore lower the multinational's expected payoff, providing a rationale for why during recent trade negotiations FDI home countries complain about low IPRs in some locations while not pushing for them to be centrally determined.
  • Publication
    CCCTB 4 EU? SA vs. FA w/ FTA
    (University College Dublin. School of Economics, 2012-10)
    Since its conception, some within the European Union have expressed concerns over the ability of multinationals to avoid taxation by undertaking transfer pricing to shift profits towards low tax locations. These concerns have been growing, leading to a renewed call for a common consolidated corporate tax base wherein profits are allocated to nations according to a formula rather than firms’ internal prices. This paper analyzes the merits of such a shift in taxation. In particular, it is shown that, given tax rates, implementing formula apportionment can result in greater tax revenues and less intense tax competition particularly for lower trade barriers. However, this is not always the case and depends on parameter values, including those describing the extent of economic integration.
  • Publication
    I’ve Been Everywhere (Except Mexico): Investor Responses to NAFTA’s Cross-Border Trucking Provisions
    (University College Dublin. School of Economics, 2015-01) ; ;
    We investigate the response of US trucking firms to the removal of barriers to cross-border trucking under NAFTA. This was done via a program implemented in 2007, cancelled in 2009, and reinstated in 2011. We find that, unsurprisingly, the program’s start resulted in lower stock returns, particularly for border firms. However, later policy changes indicate that investors, and particularly those in US multinationals, viewed the pilot as beneficial. We use a model of endogenous exporting to show that this can arise from incorrect expectations of import competition.
  • Publication
    A Negotiation-Based Model of Tax-Induced Transfer Pricing
    (University College Dublin. School of Economics, 2014-07) ;
    We present a new model of tax induced transfer pricing as an alternative to the oft-used concealment model. Inspired by interviews with practitioners, we consider a large multinational firm which is audited by the tax authority in the high-tax location. When this country adjusts the transfer prices proposed by the firm, the low-tax location may dispute this decision and initiate negotiations. Since negotiations are costly, the high-tax location sets a transfer price that prevents the low-tax location from entering negotiations. We compare this model's predictions to those of the concealment model. The negotiation model replicates the predictions on the tax rate effects on transfer pricing, while adding new predictions. Profit shifting is expected to fall in the high-tax country's bargaining power and to rise in firm profits and domestic firm ownership in both countries. Most importantly, profit shifting occurs even if tax enforcement is perfect. We analyze the effects of an introduction of a common consolidated corporate tax base with formula apportionment and conclude that the negotiation model may change the perspective on such a policy. Specifically, strong countries with large bargaining power may find this reform unappealing.
  • Publication
    OK Computer: The Creation and Integration of AI in Europe
    (University College Dublin School of Economics, 2019-05) ; ; ;
    This paper investigates the creation and integration of Artificial Intelligence (AI) patents in Europe. We create a panel of AI patents over time, mapping them into regions at the NUTS2 level. We then proceed by examining how AI is integrated into the knowledge space of each region. In particular, we find that those regions where AI is most embedded into the innovation landscape are also those where the number of AI patents is largest. This suggests that to increase AI innovation it may be necessary to integrate it with industrial development, a feature central to many recent AI-promoting policies.