Fractional Logit Model Research Articles

Cultural Participation Patterns: Evidence from the Spanish Time Use Survey

We explore cultural participation in Spain by doing an empirical exercise with the data of the Encuesta de Empleo del Tiempo 2002-2003 for Spain (TUS), a multi-member household time use dataset. We use information on individual time allocation for a surveyed day and for cultural attendance for the previous last four weeks. Taking benefit of that information, we are able of discussing both resource allocation issues, as well as observed choices. First, we take benefit of the individual diaries to describe time allocated to each type of cultural activity and estimate models that explain that allocation at the individual level. We estimate fractional logit models. Second, we use the variables that measure social and cultural participation in the last 4 weeks to study the determinants of cultural attendance for a wide set of activities. We estimate models for count data that allow characterizing the observed behaviour as the mixing of heterogeneous subpopulations. Last, we interpret the findings and discuss future research.

The economics of global light pollution

Abstract This paper is the first analysis of the economic factors of global light pollution. Light pollution commonly refers to excessive or obtrusive artificial light caused by bad lighting design. Light pollution generates significant costs including negative impacts on wildlife, health, astronomy, and wasted energy—which in the U.S. amounts to nearly 7 billion dollars annually. Current scientific models of light pollution are purely population based. The current paper utilizes unique remote sensing data and economic data from the World Bank to quantify the economic causes of light pollution globally. Fractional logit models show that, similar to other types of pollution, both population and GDP are significant explanatory variables.

Forest–mill integration: A transaction cost perspective

In Canada, where public ownership of forestland is prevalent, a central decision facing policy makers is how to allocate timber resources to private forest companies. Debates tend to focus around what proportion of the annual harvest should be devoted to markets as opposed to long-term contracts. To give a guide to policy makers, we surveyed forest firms from New Zealand and Sweden where this decision is based purely on a commercial basis. On average, mills source fifty percent of their fibre from the market. However, using a fractional logit model, we test whether theories from transaction cost economics influence this decision. Results are consistent with transaction cost economics; firms decrease the proportion of fibre sourced from a market with increasing fibre specificity, capital intensity, forest ownership concentration and uncertainty.

Modeling the Driving Forces of the Land Use and Land Cover Changes Along the Upper Yangtze River of China

Induced by high population density, rapid but uneven economic growth, and historic resource exploitation, China's upper Yangtze basin has witnessed remarkable changes in land use and cover, which have resulted in severe environmental consequences, such as flooding, soil erosion, and habitat loss. This article examines the causes of land use and land cover change (LUCC) along the Jinsha River, one primary section of the upper Yangtze, aiming to better understand the human impact on the dynamic LUCC process and to support necessary policy actions for more sustainable land use and environmental protection. Using a repeated cross-sectional dataset covering 31 counties over four time periods from 1975 to 2000, we develop a fractional logit model to empirically determine the effects of socioeconomic and institutional factors on changes for cropland, forestland, and grassland. It is shown that population expansion, food self-sufficiency, and better market access drove cropland expansion, while industrial development contributed significantly to the increase of forestland and the decrease of other land uses. Similarly, stable tenure had a positive effect on forest protection. Moreover, past land use decisions were less significantly influenced by distorted market signals. We believe that these and other findings carry important policy implications.

Firm Heterogeneity and Choice of Ownership Structure: An Empirical Analysis of German FDI in India

We contribute to the literature on the heterogeneity of multinational enterprises (MNEs) and the relevance of firm characteristics for analyzing the determinants of outward foreign direct investment (FDI). The focus is on the role of firm-level heterogeneity when MNEs decide on the share of ownership in foreign affiliates. We combine two firm-specific datasets on German MNEs with varying equity stakes in Indian affiliates. The impact of firm characteristics on ownership shares is assessed in the context of OLS and fractional logit models, controlling for industry and location characteristics. We show that the effect of several characteristics differs between the establishment of new affiliates by German MNEs and their engagement in already existing Indian firms. Most notably, the productivity of the German parents matters only for ownership shares in new affiliates.

Persistent Disparities in Pap Test Use: Assessments and Predictions for Asian Women in the U.S., 1982–2010

Disparities in cancer screening among U.S. women are well documented. However, little is known about Pap test use by Asian women living in the U.S. Data for women, ages 18 and older, living in the U.S. were obtained from National Health Interview Survey (NHIS) files from 1982 to 2005. Outcomes were ever having a Pap test and having a Pap test within the preceding 3 years. Pap test prevalence trends were estimated by race and ethnicity and for Asian subgroups. Fractional logit models were used to predict Pap test use in 2010. Although the rate of having a Pap test within the preceding 3 years increased slightly from 1982 to 2005 for all U.S. women, Asian women continue to have the lowest rate. Pap test use also varied within Asian subpopulations living in the U.S. None of the races and ethnicities are predicted to reach the Pap test targets of Healthy People 2010. To reduce or eliminate continuing disparities in Pap test use requires targeted policy interventions.

Firm Heterogeneity and Choice of Ownership Structure

We contribute to the nascent literature on the heterogeneity of multinational enterprises (MNEs) and the relevance of firm characteristics for analyzing the determinants of outward foreign direct investment (FDI). The focus is on the role of firm-level heterogeneity when MNEs decide on the share of ownership in foreign affiliates. We combine two firm-specific datasets on German MNEs with varying equity stakes in Indian affiliates. The impact of firm characteristics on ownership shares is assessed in the context of OLS and fractional logit models, controlling for industry and location characteristics. We show that the effect of several characteristics differs between the establishment of new affiliates by German MNEs and their engagement in already existing Indian firms. Most notably, the productivity of the German parents matters only for ownership shares in new affiliates.

The impact of smoking and quitting on household expenditure patterns and medical care costs in China

Background:Smoking remains very common in Chinese men, and the economic burden caused by cigarette consumption on smokers and their families may be substantial. Using a large nationally representative household survey,...

Sustainable exchange rates when trade winds are plentiful

In the present study we investigate the relationship between foreign ownership and innovation activities using the firmlevel data of the third Community Innovation Survey (CIS) covering twelve European countries. Probit estimates based on 28,000 firms' observations show that foreign-owned firms are more innovative than domestic firms, particularly in the New EU Member States. However, results from the Blinder-Oaxaca decomposition of the differences in the percentage of innovating firms between foreign-owned and domestic firms reveals that the differences are mainly due to the different firm characteristics rather than the differences in coefficients. In particular, the dominance of foreign-owned firms in the largest firm size group is the main factor contributing to the gap in the percentage of innovators between foreign-owned firms and domestic firms. Furthermore, using the fractional logit model, we find that in the New EU Member states, foreign ownership has a positive and significant impact on the share of market novelties as well as on the share of new products in turnover. In this case, the results from the Blinder-Oaxaca decomposition analysis indicate that the ownership difference in the share of innovative sales is not due to the differences in the observed firms' characteristics.

Effects of Foreign Ownership On Innovation Activities: Empirical Evidence for Twelve European Countries

In the present study we investigate the relationship between foreign ownership and innovation activities using the firmlevel data of the third Community Innovation Survey (CIS) covering twelve European countries. Probit estimates based on 28,000 firms' observations show that foreign-owned firms are more innovative than domestic firms, particularly in the New EU Member States. However, results from the Blinder-Oaxaca decomposition of the differences in the percentage of innovating firms between foreign-owned and domestic firms reveals that the differences are mainly due to the different firm characteristics rather than the differences in coefficients. In particular, the dominance of foreign-owned firms in the largest firm size group is the main factor contributing to the gap in the percentage of innovators between foreign-owned firms and domestic firms. Furthermore, using the fractional logit model, we find that in the New EU Member states, foreign ownership has a positive and significant impact on the share of market novelties as well as on the share of new products in turnover. In this case, the results from the Blinder-Oaxaca decomposition analysis indicate that the ownership difference in the share of innovative sales is not due to the differences in the observed firms' characteristics.

An assessment of the current structure of food demand in urban China

AbstractWe evaluate the current structure of food demand in urban China by using household expenditure survey data from five provinces. Two complementary analyses are undertaken. First, an aggregate analysis based on a fractional logit model is used to examine how households allocate food expenditures across the food‐at‐home (FAH) and food‐away‐from‐home (FAFH) categories. This is followed by a disaggregated analysis of how households allocated their FAH expenditures across 12 commodity categories. A Quadratic Almost Ideal Demand System (QUAIDS) is used. We find evidence of significant food purchase substitution and complementarity.

Ill health and its potential influence on household consumptions in rural China

Ill health is very expensive and could have significant impact on household consumptions. The purpose of this study is to examine the differences in household consumption patterns among households with or without ill health family member(s) in rural China. We also examine the opportunity cost of ill health by estimating the marginal effects of medical spending on consumption patterns. The data used in this study are from the baseline survey of a community-based rural health insurance study in a poor rural area of China conducted in 2002. The unit of analysis in this study is the household; 4553 households are included in this survey. Fractional Logit model is used as our prediction model. Ill health is measured by the presence of hospitalization and presence of diagnosed chronic disease(s) in a household. Findings from this study reveal that ill health and medical expenditure reduces household investment in human capital, physical capital for farm production, and other consumptions that are critical to human well-being. Subgroup analysis displayed that the impacts of medical expenditure on household consumption patterns described above are more significant in low-income households than in high-income households. In addition, the decline of the percentages of other consumptions is much larger for households with hospitalization than for households with chronic diseases.

The impact of tobacco expenditure on household consumption patterns in rural China

Smoking is not only unhealthy, it is also expensive. Spending on tobacco could drive out other critical expenditures, including basic needs. This crowd out effect would be greatest in low-income countries, affecting not only the smoker but the rest of the family as well. The aim of this study is to examine the impact of tobacco spending on household expenditure patterns in rural China. China is a low-income country with a high prevalence of smoking, especially among men. The data, a sample of 4538 households, are from a household survey conducted in six townships in two provinces in rural China. Fractional Logit (Flogit) model is used as the estimation method. We estimate the relationship between tobacco spending and spending on 17 other categories, controlling for socio-economic and demographic characteristics of the household. The results indicate that spending on tobacco affects human capital investment (e.g. education and health), future farming productivity (e.g. farming equipment and seeds), and financial security (e.g. saving and insurance). Smokers also tend to spend more on alcohol, thus exacerbating the impact of addictive substances on spending on basic needs. Smoking expenses can harm other family members by reducing expenditures on basic needs such as foods, utilities, and durable goods consumption. Thus smoking can have important intra-family distributional impacts.