Essays in applied econometrics

Rocco, Leandro

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Description

Title

Essays in applied econometrics

Author(s)

Rocco, Leandro

Issue Date

2013-08-22T16:42:15Z

Director of Research (if dissertation) or Advisor (if thesis)

Baer, Werner W.

Doctoral Committee Chair(s)

Baer, Werner W.

Committee Member(s)

• Almeida, Heitor
• Lubotsky, Darren H.
• Bera, Anil K.

Department of Study

Economics

Discipline

Economics

Degree Granting Institution

University of Illinois at Urbana-Champaign

Degree Name

Ph.D.

Degree Level

Dissertation

Keyword(s)

• Cell phone ban
• Legislation
• Distracted driving
• Motor vehicle fatalities
• Sarbanes-Oxley Act
• Value-at-Risk
• Regression Discontinuity Design
• Kuznets Curve
• Bayesian Model Averaging
• Nonparametric Model Selection

Abstract

This dissertation is divided into three chapters. In the first chapter, I study the effects of texting and handheld cell phone bans on the traffic crash fatalities in the United States. In the second chapter, I analyze the impact of the Sarbanes-Oxley Act on the Value-at-Risk of the companies with publicly traded stocks. The last chapter is devoted to analyze the relationship between economic growth and economic inequality in Brazil. Below are the individual abstracts for each chapter. Chapter 1: Are Handheld Cell Phone and Texting Bans Really Effective in Reducing Fatalities? This chapter aims at evaluating if texting and handheld cell phone bans are effective in reducing the number of fatalities occurring in motor vehicle crashes using US county-level data. In the past two decades many debates have been going on among policy makers regarding the impact of using mobile phone devices while driving. This political debate is partially motivated by the lack of clear empirical evidence on the relationship between cell phone use, bans and driving performance. Our results show that States that enacted primary cell phone bans experienced a significant reduction in the number of fatalities. Primary texting bans also affected fatalities, but this effect was significantly smaller than that estimated for handheld cell phone bans. This is an important and contradicting result, given most of the legislative activity in 2012 focused on text messaging behind the wheel, considered the most dangerous of the distracted driving activities. Additionally, we looked at how heterogeneous were these effects among states that enacted such bans. We observed that all states benefited from the ban in terms of fatality reduction, however, some were highly affected (such as CA and DC) and some affected in small scale (such as UT and WA). Chapter 2: Effects of the Sarbanes-Oxley Act on the Value-at-Risk of the Companies Registered in the NYSE, Nasdaq and Amex. This chapter aims at investigating the impact of the Sarbanes-Oxley Act (SOX) on the Value-at-Risk (VaR) of the companies that trade their bonds in the New York Stock Exchange (NYSE), Nasdaq and American Stock Exchange (Amex). We implemented a Regression Discontinuity Design approach given the cutoff point of US$75 million. Companies above the cutoff with annual reports for fiscal years ending on or after November 15, 2004 were required to comply with SOX. Our results did not find any significant impact of the SOX on the VaR for the levels of 1%, 5% and 10%. The benefits of the SOX such as giving more transparency to the companies are perfectly offset by the higher cost faced by the companies subject to the Section 404. Chapter 3: Is There a Kuznets Curve for Brazil?: An Investigation Using Bayesian Model Averaging and Nonparametric Model Selection. Brazil has become one of the major emerging countries in the world, registering a promising development scenario. However, the income inequality in Brazil remains higher if compared to countries with similar level of development. Researchers have put much effort in understanding the relationship between economic growth and economic inequality by estimating the Kuznets curve using different econometric models, functional forms and estimation strategies, but the results are still controversial. Since there is uncertainty about the economic model and variables used to understand this question, this chapter aims at estimating the Kuznets curve for Brazilian municipalities by using Bayesian Model Averaging and nonparametric model selection, and identifying the key determinants of economic inequality. Our results have shown lack of evidence for the existence of the Kuznets hypothesis, although the relationship between income inequality and economic growth is nonlinear. Variables related to education and provision of basic services seem to have large impact in reducing income inequality, while current expenditure and State tax transfer seem to be irrelevant.

Graduation Semester

2013-08

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http://hdl.handle.net/2142/45499

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Copyright 2013 Leandro Rocco

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