Arnab Bhattacharjee

Heriot-Watt University · Economics Research Group

Last year saw yet another year of weather extremes. The Copernicus Climate Change Service run by the European Centre for Medium-Range Weather Forecasts on behalf of the European Commission (Copernicus, 2024) measured 2023 as being globally the warmest year since records began in 1850. This was by a large margin (0.17 per cent) over the previous rec...

Child stunting is a serious challenge in Indonesia, one of the largest middle income countries in the world. Beyond the influence of bio-behavioral determinants, mothers’ bargaining power in the household is expected to have an overarching contribution to stunting, particularly as the primary caregivers of their children. Using a dataset from the f...

Growth-at-Risk has recently become a key measure of macroeconomic tail-risk, which has seen it be researched extensively. Surprisingly, the same cannot be said for Inflation-at-Risk where both tails, deflation and high inflation, are of key concern to policymakers, which has seen comparatively much less research. This paper will tackle this gap and...

Mixed frequency data has been shown to improve the performance of growth-at-risk models in the literature. Most of the research has focused on imposing structure on the high-frequency lags when estimating MIDAS-QR models akin to what is done in mean models. However, only imposing structure on the lag-dimension can potentially induce quantile variat...

This paper aims to explore and assess alternative data sources for wealth in order to improve existing pension wealth statistics. We find that, notwithstanding some limitations, the Wealth and Assets Survey (WAS) is currently the most comprehensive source. Then, we conduct a comparative analysis of WAS against alternative data sources, including po...

Space is an important element for understanding housing values: it assimilates the complexity of locational preferences and translates them through market price dynamics. In housing price modeling, space tends to be incorporated through the lens of spatial heterogeneity and spatial dependence, which need to be explicitly modeled. The scientific deb...

This editorial summarizes the papers in issue 18(2) (2023). The first paper extends the Solow–Swan growth model with spatial dependence, pollution and time delay. The second paper investigates the (mis)match between relative factor costs and the output elasticities of production factors due to innovations in the European Union’s Smart Specialisatio...

Introduction: Intercity mobility restriction, physical distancing, and mask-wearing are preventive behaviors to reduce the transmission of COVID-19. However, strong cultural and religious traditions become particular challenges in Indonesia. This study uses the Behavior Change Wheel to explore barriers and facilitators for intercity mobility restri...

The empirical link between children's cognitive ability and parental risk attitudes has been understudied. Specifically, an individual's educational outcome may reflect the decisions made on their behalf by parents, reflecting their risk attitudes. This paper aims to fill gaps in the existing literature by investigating whether parental risk prefer...

The innovativeness of a firm not only improves its own survival chances but also can generate externalities on its neighbouring firms. We empirically examine the role of agglomeration economies in how innovativeness affects firm survival in southern Italy, using spatial weights to model spillovers. Spatial Durbin probit model estimates confirm that...

This editorial summarizes the papers in issue 18(1) (2023). The first paper sets out a game-theoretic duopolistic spatial model to investigate whether online retailing causes more transportation-related emissions than offline retailing. The second paper proposes a methodology for statistically downscaling projected gross domestic product (GDP). The...

The UK’s income and consumption taxes are broadly progressive, yet asset and income inequality is worsening for many households across the country. This report reviews how a progressive consumption tax (PCT) could be implemented, how the transition from the current system could be taken forward and investigates the distributional consequences of in...

This editorial summarizes the papers in issue 17(4) (2022). The first paper combines input–output modelling with priority weighting to analyse supply-chain impacts of disasters. The second paper examines skill-based functional specialization of value chains in Brazil using interregional and international value-added measures. The third paper questi...

This paper investigates the benefits of internet search data in the form of Google Trends for nowcasting real U.S. GDP growth in real time through the lens of mixed frequency Bayesian Structural Time Series (BSTS) models. We augment and enhance both model and methodology to make these better amenable to nowcasting with large number of potential cov...

Background The number of food banks (charitable outlets of emergency food parcels) and the volume of food distributed by them increased multi-fold in the United Kingdom (UK) since 2010. The overwhelming majority of users of food banks are severely food insecure. Since food insecurity implies a nutritionally inadequate diet, and poor dietary intake...

This editorial summarizes the papers published in issue 17(3) (2022). The first paper analyses the impact of knowledge spillovers on patent applications using a Tobit model. The second paper sets out an economic-theoretical model of industrial specialization patterns across cities and their impact on the spatial agglomeration of skilled workers and...

This editorial summarizes the papers published in issue 17(2) (2022). The first paper evaluates logistic regression and machine-learning methods for predicting firm bankruptcy. The second paper demonstrates that machine learning outperforms existing tools to improve the estimation of regional input–output tables. The third paper investigates whethe...

This editorial summarizes the papers published in issue 17(1) (2022). This issue begins with a second editorial calling on researchers to publish replication results from previous studies. The first paper applies a spatiotemporal Bayesian hierarchical model for understanding the dynamics of second home ownership in Corsica. The second paper determi...

This editorial summarizes the papers published in issue 16(4) (2021). The first paper adopts a higher order spatial autoregressive model with endogenous spatial weight matrices. The second paper investigates the existence of the law of one price using regional observations over time. The third paper develops an economic-theoretical model that goes...

Assuming that it is not possible to detach a dwelling from its location , this article highlights the relevance of space in the context of housing market analysis and the challenge of capturing the key elements of spatial structure in an automated valuation model: location attributes, heterogeneity, dependence and scale. Thus, the aim is to present...

It is important for demographic analyses and policy-making to obtain accurate models of spatial diffusion, so that policy experiments can reflect endogenous spatial spillovers appropriately. Likewise, it is important to obtain accurate estimates and forecasts of demographic variables such as age-specific fertility rates, by regions and over time, a...

This editorial summarizes the papers published in issue 16(3) (2021) in order to raise the bar in applied spatial economic research and highlight new trends and knowledge. The first paper analyses the economic consequences of the rise and spread of the Covid-19 virus in the Brazilian state of São Paulo. The second paper presents a multi-regional ge...

There are missing links between research and policy that can be provided by better information on the real world. This is important not only to evaluate the contribution of research to the policy makers and to society, but also to design policies based on evidences. Three models for meeting such objectives are presented, emphasizing the role of (a)...

This paper investigates the added benefit of internet search data in the form of Google Trends for nowcasting real U.S. GDP growth in real time through the lens of the mixed frequency augmented Bayesian Structural Time Series model (BSTS) of Scott and Varian (2014). We show that a large dimensional set of search terms are able to improve nowcasts b...

This editorial summarises the papers published in issue 15.4 in order to raise the bar in applied spatial economic research and highlight new trends and knowledge. The first paper challenges the standard notion that more growth is better. The second paper challenges macroeconomic models by looking at them from a regional micro-grounded lens, where...

THE PROSPECTS FOR REGIONAL DISPARITIES IN THE UK IN TIMES OF BREXIT AND COVID-19 - Volume 253 - Arnab Bhattacharjee, David Nguyen, Tony Venables

We use microsimulation combined with a model of the COVID-19 impacts on individuals and households to obtain projections of households in destitution in the United Kingdom. The projections are estimated at two levels: aggregate quarterly for the UK, for all quarters of 2020; and annual for 2020 differentiated by region, sector and household demogra...

This editorial summarizes the papers published in issue 15(2) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper combines a conditionally autoregressive process from the spatial statistics literature with a spatial Durbin error model from the spatial econometrics literature. The second paper feeds...

In addition to the three special issue papers, issue 15.1 contains two papers on input-output analysis. The first paper provides a thorough analysis of the cross entropy (CE) method to build input-output tables at sub-territorial levels or to update them in time. The second paper proposes a spatial input-output location quotient accounting for the...

Housing is more than a living space; it represents a social status capable of promoting several forms and levels of socialization and segregation. Housing is characterized by a set of attributes and functions that are valued differently, in which the consumption of “good housing” is made considering the preferences of their attributes, perceived ta...

There is substantial interest in the current literature – spanning finance, economics, engineering and medical imaging – on the relationship structure between several nodes in a complex system. In this paper, we extend the literature by developing model and inference for complex networks in terms of latent factors, by extracting the hidden factors...

This editorial summarises the papers published in issue 14(4) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper analyses the impact of re-exports on bilateral trade data. The second paper proposes a new measure for the popular smart specialisation index (S3). The third paper proposes a new solutio...

This editorial summarizes the papers published in issue 14(2) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper deals with past and current challenges for regional science research. The second paper investigates whether people living in deprived neighbourhoods have less chance of succeeding in a j...

Recent event study literature has highlighted abnormal stock returns, particularly in short event windows. A common explanation is the cross-correlation of stock returns that are often enhanced during periods of sharp market movements. This suggests the misspecification of the underlying factor model, typically the Fama-French model. By drawing upo...

This editorial summarizes the papers published in issue 14(1) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper applies the Shapley-based decomposition approach to determine the impact of firm-, linkage- and location-specific factors to the survival probability of enterprises. The second paper app...

We propose generalized moments LASSO estimator, combining LASSO with GMM, for penalized variable selection and estimation under the spatial error model with spatially autoregressive errors. We establish parameter consistency and selection sign consistency of the proposed estimator in the low dimensional setting when the parameter dimension p < samp...

This editorial summarizes the papers published in issue 13(4) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper develops an economic geography model with trade costs in all sectors and different shares of unskilled labour in all locations. The second paper translates an economic geography model in...

This paper develops a new identification result for the causal ordering of observation units in a recursive network or directed acyclic graph. Inferences are developed for an unknown spatial weights matrix in a spatial lag model under the assumption of recursive ordering. The performance of the methods in finite sample settings is very good. Applic...

This editorial summarizes the papers published in issue 13(3) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper challenges the home market hypothesis that large countries host more firms relative to their size than small countries by considering the lobbying activities of multinational firms. The...

Purpose Literature, spanning industrial organization and strategic management disciplines, uses variance decomposition to understand the relative importance of firm, industry and business group effects in shaping profitability variations. Some literature analyzes firm profitability under transition to liberalization. Previous research has taken a...

Sustainable procurement is steering today's supply chains towards responsible business practices. This research aims to examine the trend in the sustainability performance of large enterprises for supplier selection across supply chain tiers and geographic locations. Secondary data on 83 global, large enterprises discussing sustainable procurement...

The papers in this special issue cover a wide range of areas in the methodology and application of spatial econometrics. The first develops a generalized method of moments (GMM) estimator for the spatial regression model from a second-order approximation to the maximum likelihood (ML). The second develops Bayesian estimation in a stochastic frontie...

This editorial summarises the papers published in issue 13.1 so as to raise the bar in applied spatial economic research and highlight new trends. The first paper adopts a scale neutral approach to investigate the spatial mechanisms that cause regional innovation and growth. The second paper claims that population-weighting when calculating indices...

Raising the bar (6). Spatial Economic Analysis. This editorial summarizes and comments on the papers published in issue 12(4) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper addresses the question of whether ‘jobs follow people’ or ‘people follow jobs’. The second paper develops a new methodolog...

Functional regression over irregular domains: variation in the shadow price of living space. Spatial Economic Analysis. Hedonic house price models need to account for spatial heterogeneity – the variation in the functional surface of shadow prices. In this context, the complexity of spatial domains raises issues for traditional spatial econometric...

Raising the bar (5). Spatial Economic Analysis. This editorial summarizes and comments on the papers published in this issue 12(1) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper examines the impact of the level of education on the decision to migrate and finds that it is approximately twice as...

This editorial summarizes and comments on the papers published in issue 11(4) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper deals with common factors and spatial dependence in the error term specification of a production function model. The second paper sets forth a New Economic Geography (NEG...

This editorial summarizes and comments on the papers published in issue 11(3) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper proposes spatial and a-spatial indicators to describe the networks of airline companies around the world. The second paper sets forth a two-regime gravity-type model with...

In this editorial we summarise and comment on the papers published in issue 11.2 so as to raise the bar in applied spatial economic research and highlight new trends. The first paper analyses which regions in Europe were resilient to the great Recession and which ones were not. The second and the third develop a competing-destinations gravity model...

The financial crisis of 2007–11 has now been analysed and explained from almost every conceivable standpoint. Far less attention has been paid to the long business cycle expansion that started in 1992 and provided an exceptional period of macroeconomic stability in the UK. To many it seemed that the main problem of the UK economy had been solved: t...

In this editorial, we summarize and comment on the papers published in issue 11.1 so as to raise the bar in applied spatial economic research and highlight new trends. The first paper employs the J-test to discriminate between two economic-theoretical explanations for the wage curve. The second applies a two-step ML procedure to measure the impact...

There is substantial interest in the current literature — spanning finance, management sciences and economics — on the network structures between business firms. In this context, a very important question centers around the factors that affect the stability and resilience of interfirm networks. What kind of network structure offers the best ability...

Housing submarkets have been defined by different criteria: (i) similarity in house attributes; (ii) similarity in hedonic prices; and (iii) substitutability of houses. We show that spatial clustering on (i) and (ii) also satisfies criterion (iii) and develop inferences based on functional linear regression of a hedonic house price model. Then, we...

The vast majority of spatial econometric research relies on the assumption that the spatial network structure is known a priori. This study considers a two-step estimation strategy for estimating the n(n-1) interaction effects in a spatial autoregressive panel model where the spatial dimension is potentially large. The identifying assumption is app...

Socioeconomic characteristics, health behaviours, and the utilisation and quality of healthcare are prime examples of socioeconomic, cultural and demographic phenomena that are inherently spatial in nature. Understanding the spatial structure of these factors is particularly relevant in order to efficiently allocate resources. This paper explores t...

We study the impact of both microeconomic factors and the macroeconomy on the financial distress of Chinese listed companies over a period of massive economic transition, 1995 to 2006. Based on an economic model of financial distress under the institutional setting of state protection against exit, and using our own firm-level measure of distress,...

W e assess absolute magnitudes, relative importance, and intertemporal differences in firm, industry, and business group effects in explaining the variance of Indian manufacturing firms' profitability over the 26-year period between 1980-1981 and 2005-2006. We stratify the data by institutional phases to place emphasis on the role of changing insti...

It is widely believed that setting monetary policy through a majority voting committee has major benefits. A monetary policy committee can take personalities out of monetary policy decisions. Critical to understanding these claims is an assessment of how such a committee functions. In this paper we examine interactions and influences between commit...

While estimates of models with spatial interaction are very sensitive to the choice of spatial weights, considerable uncertainty surrounds de nition of spatial weights in most studies with cross-section dependence. We show that, in the spatial error model the spatial weights matrix is only partially identi ed, and is fully identifi ed under the str...

Este artigo realça três aspetos fundamentais da abordagem quantitativa do espaço na análise do mercado da habitação: i) heterogeneidade espacial; ii) interação espacial; e iii) escala espacial. A dificuldade de identificar mercados habitacionais e compreender as suas interações é amplamente referida na literatura, bem como a diversidade de métodos...

This paper highlights three key aspects of the quantitative analysis of space in the housing market: i) spatial heterogeneity ii) spatial interaction, and iii) spatial scale. The difficulties of identifying housing markets and understanding the levels of interaction established between sub-markets is widely stressed in the literature, as well as a...

Spatial heterogeneity, spatial dependence and spatial scale constitute key features of spatial analysis of housing markets. However, the common practice of modelling spatial dependence as being generated by spatial interactions through a known spatial weights matrix is often not satisfactory. While existing estimators of spatial weights matrices ar...

This presentation emphasizes the quantitative analysis of space in relation to hedonic housing price models. Three aspects of space will be highlighted: i) spatial heterogeneity (spatial patterns): hedonic housing amenities may be valued differently in different locations which are related to specific housing sub-markets; ii) spatial dependence (sp...

Spatial homogeneity is a strong assumption in the hedonic housing price context; if not analyzed conveniently it can be a potential source of specification errors. Spatial heterogeneity occurs when a territorial segmentation exists in the housing market and, therefore, either the hedonic prices associated with different attributes or the characteri...

Several omnibus tests of the proportional hazards assumption have been proposed in the literature. In the two-sample case, tests have also been developed against ordered alternatives like monotone hazard ratio and monotone ratio of cumulative hazards. Here we propose a natural extension of these partial orders to the case of continuous and potentia...

Theories of firm profitability make different predictions about the relative importance of firm, industry and time specific factors. We assess, empirically, the relevance of these effects over a sixteen year period in India, as a regime of control and regulation, pre 1985, gave way to partial liberalisation between 1985 and 1991 and to more decisiv...

This paper contributes to the current debate, led by Romer and Romer (2008) and Ellison and Sargent (2009) as to why forecast performance of the Federal Reserve Open Market Committee (FOMC) is inferior relative to forecasts produced by the Federal Reserve System staff members. The former suggest that the FOMC may be ineffective in forecasting, whil...

The article examines the determinants of profitability of companies in India from 1980 to 1996 and assesses the relative importance of firm and industry effects on corporate profitability over the period. The changing balance between the industry effects was evaluated as a regime of control and regulation was replaced by partial liberalization betw...

The transparency and openness of the monetary policy-making process at the Bank of England has provided very detailed information on both the decisions of individual members of the Monetary Policy Committee (MPC) and the information on which they are based. In this paper, we consider this decision-making process in the context of a model in which i...

Until recently, considerable effort has been devoted to the estimation of panel data regression models without adequate attention being paid to the drivers of interaction amongst cross-section and spatial units. We discuss some new methodologies in this emerging area and demonstrate their use in measurement and inferences on cross-section and spati...

We study the impact of both microeconomic factors and the macroeconomy on the financial distress of Chinese listed companies over a period of massive economic transition, 1995 to 2006. Based on an economic model of financial distress under the institutional setting of state protection against exit, and using our own firm-level measure of distress,...

We investigate the salary returns to the ability to play football with both feet. The majority of footballers are predominantly right footed. Using two data sets, a cross-section of footballers in the five main European leagues and a panel of players in the German Bundesliga, we find robust evidence of a substantial salary premium for two-footed ab...

We study the impact of the macroeconomic environment on business exit in a world where acquisition and bankruptcy are co-determined. We estimate competing risk hazard regression models using data on UK quoted firms spanning a 38-year period that witnessed several business cycles. We find that the processes determining bankruptcies and acquisitions...

We examine how macroeconomic instability affects risk of bankruptcy and liquidation. In periods of macroeconomic instability more firms become financially distressed, while the number of potential acquirers falls. Reorganization systems such as Chapter 11 can decouple liquidation from macroeconomic conditions. We develop a model in which a firm's b...

A teoria, a análise e políticas de habitação têm como âmbito territorial 3 escalas diferenciadas de aplicação, o nível nacional, o regional e o urbano. Em qualquer um destes níveis a análise hedónica de preços tem sido amplamente divulgada, na medida em que permite, com base em modelos de regressão estatísticos, perceber quais os atributos, quer fí...

While much of the literature on cross section dependence has focused mainly on estimation of the regression coefficients in the underlying model, estimation and inferences on the magnitude and strength of spill-overs and interactions has been largely ignored. At the same time, such inferences are important in many applications, not least because th...

In a sample of newly created French …rms, the impact of an entrepreneur's education on the …rm's survival varies widely depending on his previous labor market situation. While it is strongly positive for the overall population, it is much weaker or insigni…cant for entrepreneurs who were previously unemployed or poorly matched. Our theoretical entr...

We show that a flex-price two-sector open economy DSGE model can explain the poor degree of international risk sharing and exchange rate disconnect. We use a suite of model evaluation measures and examine the role of (1) traded and non-traded sectors; (2) financial market incompleteness; (3) preference shocks; (4) deviations from UIP condition for...

We present a model for studying regional and sectoral variation in total factor productivity (TFP) and develop an empirical test, based on the skewness of TFP distribution, to empirically distinguish between different growth theories. While negative skewness is consistent with the neo-Schumpeterian idea of catching up with leaders, zero skewness su...