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Research seminar of the School of Economics and Business Administration of the University of Tartu on 18 September

On 18 September at 11:15-12:15 you are invited to attend the research seminar of the School of Economics and Business Administration of the University of Tartu in which Pei-fen Chen (National Sun Yat-sen University, Taiwan) will present the research project “Entrepreneurship, Mobile Payment, and Financial Inclusion for Low and Middle Income Asian Economies”.

Despite the burgeoning interest in financial technology , its cor relation to entrepreneurship remains unknown. This research addresses the gap in the literature by examining the determinants of new business entrepreneurship, specific ally focusing on mobile payment , traditional financial inclusion, and regulatory factors across selected low and middle income economies. Employing a baseline panel regression model, we conduct empirical analysis from data collected from multiple sources covering 25 developing economies in Asia spanning 2014 to 2021. The findings reveal a direct and positive effect of mobile payment systems and regulatory quality on entrepreneurship versus a negative effect of traditional financial inclusion. T he study further uncovers the impact channels through which regulatory factors interact with mobile payment systems and significantly contributes to the literature by examining how financial innovations, especially mobile payment systems, stimulate entrepreneurship on a global scale. It expands research by investigating the impact of traditional financial inclusion on new business entrepreneurship sheds light on nuanced pathways through which regulatory factors shape entrepreneurship and highlights the potential interaction effect of regulatory quality with mobile payment systems. The insights generated herein are invaluable for regulators and policymakers to make informed decisions that promote entrepreneurial growth. This is especially pertinent in the post COVID 19 era, where fostering small/new business entrepreneurship drive s sustainable economic development, while also potentially catalyzing the development of financial technology solutions to enhance financial inclusivity and entrepreneurial opportunities.

Zoom meeting
Meeting ID: 998 1085 7956
Passcode: 753583

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Research seminar at Eesti Pank on 23 May

On 23 May at 10.30 am you are kindly invited to attend in Webex the Eesti Pankʼs research seminar in which András Borsos (Magyar Nemzeti Bank) will make the presentation on “Firm-level production networks:  what do we (really) know?”. 

Are standard production network properties similar across all available datasets, and if not, why? We provide benchmark results from two administrative datasets (Ecuador and Hungary), which are exceptional in that there is no reporting threshold. We compare these networks to a leading commercial dataset (FactSet) and published results on national firm-level production networks. Administrative datasets with no reporting thresholds have remarkably similar quantitative properties, while a number of important properties are biased in datasets with missing data.

Co-authors of the paper: Andrea Bacilieri, András Borsos, Pablo Astudillo-Estevez and François Lafond
Full-text of the paper

Meeting information in Webex:

https://eestipank.webex.com/eestipank/j.php?MTID=m96d2570935d3e0896b05eeead66fd202

Meeting number: 2744 731 6268
Password: Jnv5P3gPti5 (56857347, from phones and video systems)

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Research Seminar of the Department of Economics and Finance of TalTech on 22 May

You are welcome to join the Research Seminar of the Department of Economics and Finance of Tallinn University of Technology (TalTech) on Wednesday, 22 May at 16:00-17:00.

In MS Teams, please join via LINK

“Explaining consumer inertia: Drivers of attention and choice in car insurance market”
Kaido Kepp and Kadri Männasoo (Department of Economics and Finance, TalTech)

We study the vehicle lessees’ Motor Own Damage insurance search frictions and choices. We use a consumer-level annual panel of policy and insurance offers’ data from 2010-2018 from the biggest insurance broker consolidating the Estonian car insurance market offers. We apply the two-stage discrete choice model by Hortaçsu et al 2017 that identifies the sources of consumer inertia by separating the attention and choice decisions given the observed switches to new providers. Our results show strong inertia that stems from consumer inattention and considerable heterogeneity of inattention across consumer groups. Consumers choose from a set of offers and their decisions to switch or stay with the current provider reveal substantial price elasticity and a modest effect of insurance provider’s brand preference.

Keywords: car insurance, consumer behavior, choice frictions, consumer inertia, inattention
JEL classification: D12, D83, G22, G52, L84, M31
Authors: Kaido Kepp (Department of Economics and Finance, TalTech), Kadri Männasoo (Department of Economics and Finance, TalTech)
Funding: This work was supported by the European Economic Area (EEA) Financial Mechanism 2014–2021 Baltic Research Program under project S-BMT-21-8 (LT08-2-LMT-K-01-073), COST Action HiTEc, CA21163 (European Cooperation in Science and Technology) and the European Commission Research and Innovation program grant (agreement 952547).

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Research seminar at Eesti Pank on 16 May

On 16 May at 10.30 am you are kindly invited to attend in Webex the Eesti Pankʼs research seminar in which Julia Le Blanc (Joint Research Centre at the European Commission) will make the presentation on “Housing Wealth Across Countries: The Role of Expectations, Institutions and Preferences”. 

Homeownership rates and holdings of housing wealth differ immensely across countries. We specify and estimate a life cycle model with risky labor income and house prices in which households face a discrete–continuous choice between renting and owning a house, whose sale is subject to transaction costs. The model allows us to quantify three groups of explanatory factors for long-run, structural differences in the extensive and intensive margins of housing: the homeownership rate and the value of housing wealth of homeowners. First, in line with survey evidence, we allow for differences in expectations of house prices. Second, countries differ in the institutional set-up of the housing market: maximum loan–value ratio and costs of renting, maintaining and selling a house. Third, we allow for differences in household preferences: the dispersion in discount factors, the share of housing expenditure and the bequest motive. We estimate the model using micro data from five large economies and provide a decomposition to interpret what drives the cross-country differences in housing wealth. We find that all three groups of factors matter, although preferences less so. Differences in homeownership rates are strongly affected by (i) house price beliefs and (ii) the rental wedge, the difference between rents and maintenance costs, which reflects the quality of the rental market. Differences in the value of housing wealth are substantially driven by housing maintenance costs.

Meeting information in Webex:

https://eestipank.webex.com/eestipank/j.php?MTID=mcd3e9cf28363b1bd660c184bb6ef9c76

Meeting number: 2743 927 9631
Password: REgwGFpn973 (73494376, from phones and video systems

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Research seminar of the School of Economics and Business Administration of the University of Tartu on 15 May

On 15 May at 11:00-12:00 you are invited to attend the research seminar of the School of Economics and Business Administration of the University of Tartu in which Thomas Post (Maastricht University) will present the research project “Savings goals matter – Cognitive constraints, retirement planning, and downstream economic behaviors”.

We study how cognitive constraints relate to each distinct step of the planning and execution process for retirement, that is, individuals’ propensity to plan, savings goals set, and economic outcomes (wealth accumulation and portfolio choice). We find that different cognitive constraints play distinct roles: Higher advanced financial literacy (and quantitative reasoning ability) predicts a greater propensity to plan, while higher basic financial literacy and verbal cognition predict setting higher savings goals. Math-related abilities are not associated with savings goals in a systematic way. Furthermore, our evidence shows that the economic consequences of retirement planning depend on the earlier set savings goals. In comparison to non-planners, only planners with a higher savings goal (above the median) accumulate more wealth and are more likely to hold risky assets and private annuities. Our findings suggest that when crafting public policy to develop individuals’ retirement readiness, next to improving financial literacy, other targets could be to enhance cognitive skills and to support setting concrete savings goals by, for example, providing better access to planning relevant information and tools.

Zoom meeting

Meeting ID: 923 5942 4506
Passcode: 111852

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Research seminar of the School of Economics and Business Administration of the University of Tartu on 6 May

On 6 May at 14:15-15:15 you are invited to attend the research seminar of the School of Economics and Business Administration of the University of Tartu in which Attila Havas (Hungarian Academy of Sciences) will present the research project “Measurement of innovation: selection of indicators and (mis)use of scoreboards”.

The choice of indicators to measure innovation processes and assess performance is of vital significance. This paper argues that those economic theories give a more accurate, more reliable account of innovation activities that follow a broad approach of innovation, that is, consider all knowledge-intensive activities leading to new products (goods or services), processes, business models, as well as new organisational and managerial solutions, and thus take into account various types, forms and sources of knowledge exploited for innovation by all sorts of actors in all economic sectors. In contrast, the narrow approach to innovation focuses on the so-called high-tech goods and sectors. The broad approach is needed to collect data and other types of information, on which sound theories can be built and reliable and comprehensive analyses of innovation activities can be offered to decision-makers to underpin public policies and company strategies. Analysts and policy-makers need to avoid the trap of paying too much attention to simplifying ranking exercises. Instead, it is of utmost importance to conduct detailed, thorough comparative analyses, identifying the reasons for a disappointing performance, as well as the sources of – opportunities for – balanced, and sustainable, socio-economic development.

Zoom meeting

Meeting ID: 947 0791 2630
Passcode: 549711 Continue reading “Research seminar of the School of Economics and Business Administration of the University of Tartu on 6 May”