Tag Archives: economics

Do certifications matter?

A question I am always asked during open houses is about certifications. Do they matter in the job hunting process? Do they improve earnings? Unfortunately, these questions do not have a straightforward answer. Nevertheless, the Federal Reserve Bank of Dallas published a blog post that examines earnings and certifications. They investigate the certifications mentioned by employers in job ads and also examine the earnings differentials between workers with and without certifications. This analysis indicates that the decision of getting a certification should made on a casa by case basis.

New evidence on WTO membership after the Uruguay Round: an analysis at the sectoral level.

Magnus dos Reis (Unisinos), André Filipe Zago de Azevedo (CNPq), and I have a forthcoming paper at Open Economies Review that examines the effects of WTO membership on trade flows, with a special focus on sectoral trade flows. The full paper is available upon request.

Abstract

The creation of the World Trade Organization in 1995 brought several changes to the world trade system, including more stringent accession commitments, separate agreements for agricultural products and for textiles and garment. This study examines the effects of WTO membership on disaggregated sectoral trade flows and their extensive and intensive margins by means of a gravity model estimated by Poisson pseudo-maximum likelihood. We employ a panel dataset on bilateral imports for agriculture, textile, and manufacturing sectors for the 1995–2017 period. Our estimates suggest that WTO membership has succeeded in expanding trade flows for new members. Nevertheless, this growth occurred asymmetrically between developed and developing countries, and among the different types of products. In the period under review, developing countries benefited most from this WTO-promoted increase in world trade, in stark contrast to the findings of the extant literature for 1950–2000. The largest trade growth occurred in the agriculture sector, which is also at odds with earlier findings of growth in manufacturing products only. Furthermore, our results show that the increase in trade due to WTO liberalization took place exclusively in the extensive margin of trade, most of which also happened in the agricultural sector.

 

Transferring IPEADATA series to Stata

A common issue that arises when converting time series data from IPEADATA to Stata format is dealing appropriately with the time variable. For instance, for monthly series the date format will be YYYY.MM. Stata usually interprets this format as numeric.

Suppose you already downloaded a monthly series from IPEADATA and transferred it to Stata. It is very likely that the date variable (let’s call it date) has been automatically handled as a numeric variable. The first thing to pay attention is that the numeric format disregards zeroes on the right-hand side of the decimal point. This means that October of 1940 is coded as 1940.10 by IPEADATA and interpreted as 1940.1 by Stata. To recover the missing zero, the first step is to convert this variable to string format. This can be done with the string() function.

generate sdate=string(date)

To add back the missing zeroes, we can do the following:

replace sdate=sdate+”0″ if length(sdate)<7

Now, we just need to tell Stata to interpret sdate as a monthly date variable. This can be accomplished with the command numdate. This is not a standard Stata command and needs to be installed in your computer (ssc install numdate).

numdate mo newdate = sdate, pattern(YM)

The above line can be interpreted as create a new date variable named newdate from variable sdate that is in the YYYY.MM format.

The numdate ado file can deal with very flexible date specifications, and its help file is very comprehensive. Two other useful commands are convdate and extrdate. They are used to convert or extract parts of dates from variables that are already in the Stata date format.

A final recommendation is to take a look at Stata documentation on dates that is available at http://www.stata.com/manuals13/ddatetime.pdf.

How to plot curves with different domains in Mathematica

Mathematica (or the Wolfram language) is a very useful tool to plot functions. Suppose you are interested in plotting two curves in the same diagram, let’s say y = 1/x and z = 2/x. Both functions have the same domain of x belonging to the [0,10] interval. This is easily accomplished by typing:

Plot[{1/x, 2/x}, {x, 0, 10}]

 

Suppose now that you would like to plot in the same diagram both functions but the domain of z change to x belonging to the [2,12] interval. How could you do this? This is not difficult. You just need to use the command show with the option PlotRange->All. Here is a piece of code that accomplish this:

p1 = Plot[{1/x}, {x, 0, 10}]

p2 = Plot[{2/x}, {x, 2, 11}]

Show[p1, p2, PlotRange->All]

 

A nice tutorial for those interested in learning the basics of Python and its applications to Finance

The website called FinaceandPython has a very good tutorial on the basics of Python and its applications to Finance, Statistics, and Economics. This tutorial is organized in lessons that are carefully designed for a step-by-step learning experience. It also has several problem sets that will allow students to practice the concepts developed in the lessons. A key differential of this website are the examples and applications of Python coding to Finance problems. In sum, this is a fine tutorial for those interested in learning Python.

Principles of Mathematical Economics – downloadable book

I received today an interesting book suggestion. The book titled “Principles of Mathematical Economics” is written by Professor Kam Yu (Lakehead University). This is a book about the basic math knowledge every economist should have. I find this book to be very concise and comprehensive at the same time. The examples provided are very good. In sum, I recommend this book for those interested in learning more useful math for economists.