http://www.bis.org/cbhub/list/country/country_mexico/index.rss Latest research hub papers from Mexico en http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{1673D63F-A8BA-A75E-7839-D44D118D9DF4}.pdf Bank of Mexico Working Papers by Alexandrova-Kabadjova Biliana; Solís-Robleda Francisco Managing Intraday Liquidity: The Mexican Experience 2013-03-13T12:37:59Z The present study calculates the proportional liquidity usage of the Mexican Real Time Settlement Payment System, SPEI, during a one month period. In particular, our interest is to get insights on how different is the liquidity level at the settlement in real time of low and large value payment transactions. To that end, we create an artificial environment, in which we use historical data from April 7 to May 7, 2010 and reproduce the operational conditions of SPEI. For each of these days, we arrange the transactions in four sets, delimited according to their value: all payments, payment orders with value higher than 100,000 MXN; transactions with value higher than 1,000,000 MXN and payments with value higher than 10,000,000 MXN. We measure the liquidity usage in different settings of settlement speed requirements. We find that among participants settlement strategies are heterogeneous. In particular, according to the size of the payment order, on weekly basis participants follow different patterns for settlement. Even further, payments within the same set are not homogeneously treated by banks. Managing Intraday Liquidity: The Mexican Experience 2013-03-13T12:37:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{1673D63F-A8BA-A75E-7839-D44D118D9DF4}.pdf Biliana Alexandrova-Kabadjova Francisco Solís-Robleda Alexandrova-Kabadjova Biliana; Solís-Robleda Francisco 2013 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{A2818FA5-B182-C9F6-9808-AF9FFAF62480}.pdf Bank of Mexico Working Papers by Murillo Garza José Antonio; Sánchez Romeu Paula Testing the Predictive Power of Mexican Consumers' Inflation Expectations 2013-01-17T06:21:59Z This paper introduces an indicator of consumers' inflation expectations based on data from the National Consumer Confidence Survey of Mexico (ENCO, in Spanish), and tests its predictive power over CPI inflation and other measures of inflation that correspond to smaller baskets of consumer goods, for periods that range from 1 to 12 months. Our findings show that between January 2003 and September 2010, the predictive capability of the indicator over the different measures of inflation used was weak. Due to a modification in the survey questionnaire in October 2010, as of that date we observe a significant change in the responses and, thus, in the behavior of the indicator of consumers' inflation expectations. For this reason, from October 2010 on the main use of this indicator is to be a reference of consumers' confidence in price stability. Testing the Predictive Power of Mexican Consumers' Inflation Expectations 2013-01-17T06:21:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{A2818FA5-B182-C9F6-9808-AF9FFAF62480}.pdf Antonio Murillo Garza José Paula Sánchez Romeu Murillo Garza José Antonio; Sánchez Romeu Paula 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{05DDDE5F-926A-8971-3A35-F2A28B569B1E}.pdf Bank of Mexico Working Papers by Bobonis Gustavo J.; Cámara Fuertes Luis R.; Schwabe Rainer The Dynamic Effects of Information on Political Corruption: Theory and Evidence from Puerto Rico 2012-12-19T12:37:00Z Does the disclosure of information about corrupt activities induce a sustained reduction in corruption? We use longitudinal data on audits of municipal governments in Puerto Rico to answer this question. We find that corruption is lower in municipalities audited before an election. However, these municipalities do not exhibit decreased levels of corruption in subsequent audits. Mayors in municipalities audited preceding the previous election have higher re-election rates, suggesting that audits enable voters to select more competent politicians. We present a political agency model that rationalizes the observed short-term and dynamic effects of information on corruption and re-election rates. We conclude that audit programs must be timely, sustained, and long-term commitments in order to be effective. The Dynamic Effects of Information on Political Corruption: Theory and Evidence from Puerto Rico 2012-12-19T12:37:00Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{05DDDE5F-926A-8971-3A35-F2A28B569B1E}.pdf R. Cámara Fuertes Luis Rainer Schwabe J. Bobonis Gustavo Bobonis Gustavo J.; Cámara Fuertes Luis R.; Schwabe Rainer 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{398A79B4-2624-8717-7648-C30C4B6BA125}.pdf Bank of Mexico Working Papers by Guerrero Santiago Do Agricultural Contracts Affect Grain Prices? Evidence from Mexico 2012-12-19T12:37:00Z In the late 80's and early 90's Mexico eliminated minimum price policies of main agricultural commodities and substituted those policies by government operated contract markets. Contracts can help smooth price variations and facilitate risk-sharing but their impact on price levels is uncertain. We simultaneously estimate the impacts of quantity supplied sold via contracts and the cash market on cash prices for grains participating in contracts: wheat, corn, soybeans and sorghum. By doing so we estimate an inverse grain demand function using supply shifters and other exogenous variables as exclusion restrictions. Our findings show that quantity supplied sold via contracts is a more important determinant of prices than quantity supplied in the cash market. A 10% increase of volume sold via contracts is estimated to reduce cash market prices by 2.5 %. Additionally, we find no evidence that more contracts affect prices by reducing quantity supplied in the cash market. Do Agricultural Contracts Affect Grain Prices? Evidence from Mexico 2012-12-19T12:37:00Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{398A79B4-2624-8717-7648-C30C4B6BA125}.pdf Santiago Guerrero Guerrero Santiago 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{53A3DC1A-AA2F-8DD0-C11D-3AE1641E7B8B}.pdf Bank of Mexico Working Papers by Alexandrova-Kabadjova Biliana; Solís-Robleda Francisco The Mexican Experience in How the Settlement of Large Payments is Performed in the Presence of a High Volume of Small Payments 2012-12-19T12:37:00Z Payment systems play a key role in the financial infrastructure of all modern economies. Participants of payment systems need access to intraday liquidity to fulfill their payment obligations. They do that either using their own funds, which are costly, or recycling incoming payment. In order to rely on incoming payments, banks could delay the settlement of their own payment obligations. From the regulators' point of view it is important to know to what degree participants rely on the payments they receive from others. In Mexico, this is among the first studies that analyze from this perspective the intraday liquidity management of the Real Time Settlement Payment System, SPEI. We examine a data set of transactions from April 7 to May 7, 2010 in order to get insights of the participants' behavior regarding the delay of sending payment orders. The Mexican Experience in How the Settlement of Large Payments is Performed in the Presence of a High Volume of Small Payments 2012-12-19T12:37:00Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{53A3DC1A-AA2F-8DD0-C11D-3AE1641E7B8B}.pdf Biliana Alexandrova-Kabadjova Francisco Solís-Robleda Alexandrova-Kabadjova Biliana; Solís-Robleda Francisco 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{06F111E2-1FDC-1B72-D19B-C120BBBFAE5F}.pdf Bank of Mexico Working Papers by Roldán-Peña Jessica Default Risk and Economic Activity: A Small Open Economy Model with Sovereign Debt and Default 2012-12-19T12:37:00Z Empirical evidence shows that sovereign defaults are associated with signicant downturns in economic activity in defaulting countries. However, the existing literature on sovereign debt and default mainly analyzes endowment economies and, therefore, does not address the relationship between default risk and macroeconomic dynamics. This paper develops a general equilibrium small open economy model with financial frictions that allows to simultaneously examine the behavior of output, investment and borrowing dynamics and its interaction with sovereign default. When calibrated to match the business cycles properties of an average emerging market economy, the model is able to reproduce the countercyclicality of net exports and sovereign spreads and the negative correlation between investment and net exports observed in the data. Furthermore, when analyzing its behavior around sovereign default, the model successfully captures the declines in output, consumption and investment that are actually associated with these episodes. Default Risk and Economic Activity: A Small Open Economy Model with Sovereign Debt and Default 2012-12-19T12:37:00Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{06F111E2-1FDC-1B72-D19B-C120BBBFAE5F}.pdf Jessica Roldán-Peña Roldán-Peña Jessica 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{0FAB6BA9-704E-D07B-CEC6-5012F432C2CF}.pdf Bank of Mexico Working Papers by Campos-Ortiz Francisco; Putterman Louis; Ahn T. K.; Balafoutas Loukas; Batsaikhan Mongoljin; Sutter Matthias Security of Property as a Public Good: Institutions, Socio-Political Environment and Experimental Behavior in Five Countries 2012-11-16T12:35:59Z We study experimentally the protection of property in five widely distinct countries-Austria, Mexico, Mongolia, South Korea and the United States. Our main results are the correlations between experimental choices with indicators regarding the security of property, trust and the quality of government. We show that subjects from countries with: (1) higher levels of trust or perceptions of safety are more prone to abstain from plundering and devote less resources to protect their property; and (2) high-quality political institutions support collective protection of property through taxation more often. Our results highlight the relevance of socio-political factors in determining countries' success in addressing collective action problems including safeguarding property rights. Security of Property as a Public Good: Institutions, Socio-Political Environment and Experimental Behavior in Five Countries 2012-11-16T12:35:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{0FAB6BA9-704E-D07B-CEC6-5012F432C2CF}.pdf Francisco Campos-Ortiz Mongoljin Batsaikhan Loukas Balafoutas K. Ahn T. Louis Putterman Matthias Sutter Campos-Ortiz Francisco; Putterman Louis; Ahn T. K.; Balafoutas Loukas; Batsaikhan Mongoljin; Sutter Matthias 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{604B262F-EEA1-25B9-BD02-B9677943F3DC}.pdf Bank of Mexico Working Papers by Alcaraz Carlo; Chiquiar Daniel; Orraca María José; Salcedo Alejandrina The Effect of Publicly Provided Health Insurance on Academic Performance in Mexico 2012-11-16T12:35:59Z In this paper we study the causal effect of a large expansion of publicly provided health insurance on children's academic performance using the case of Mexico. In general, access to free health insurance could improve education outcomes directly by making household members healthier or indirectly by raising the amount of resources available for education expenses. Using a panel of municipalities from 2007 to 2009, we find that the expansion of the Mexican public health insurance program, Seguro Popular, had a positive, statistically significant effect on standardized test scores of primary school children. The Effect of Publicly Provided Health Insurance on Academic Performance in Mexico 2012-11-16T12:35:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{604B262F-EEA1-25B9-BD02-B9677943F3DC}.pdf Carlo Alcaraz Alejandrina Salcedo Daniel Chiquiar José Orraca María Alcaraz Carlo; Chiquiar Daniel; Orraca María José; Salcedo Alejandrina 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{86F1E2C2-48AF-469A-5969-3D70574A9713}.pdf Bank of Mexico Working Papers by Abarca Gustavo; Ramírez Claudia; Rangel José Gonzalo Capital Controls and Exchange Rate Expectations in Emerging Markets 2012-11-16T12:35:59Z This article examines changes in the exchange rate expectations associated with capital controls and banking regulations in a group of emerging countries that implemented these measures to control the adverse effects of sudden capital flows on their currencies. The evidence suggests that for most countries the effects of this type of policies are limited. Moreover, in some cases they appear to have an opposite effect from the one intended. In particular, for some currencies our results suggest there were changes in the extremes of their exchange rate distributions, which make their tails heavier and signal that the market allocates a greater probability to extreme movements. In the same way, evidence is found that this type of measures increases the levels of currency risk premium. Capital Controls and Exchange Rate Expectations in Emerging Markets 2012-11-16T12:35:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{86F1E2C2-48AF-469A-5969-3D70574A9713}.pdf Gustavo Abarca Claudia Ramírez Jose Gonzalo Rangel Abarca Gustavo; Ramírez Claudia; Rangel José Gonzalo 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{6AE024E8-6DD6-CF6F-519C-17190CDE32B1}.pdf Bank of Mexico Working Papers by Delajara Marcelo; Murillo Garza José Antonio Weekday with Low Prices: Evidence on Daily Seasonality of Foods, Beverages and Tobacco Prices 2012-11-16T12:35:59Z In this document we analyze the evidence of daily seasonality found in the weekly price variations of food, beverages, and tobacco in the Metropolitan Area of Mexico City. Our research is based on the daily price quotes of 2,724 goods, collected by Banco de México for the Consumer Price Index (CPI), in 434 commercial establishments between March 2009 and June 2010. We identify the weekday with the lowest weekly variation in prices, and find that it differs across products, types of commercial establishment, and supermarket chains. Moreover, we find that such a "day of the week" effect increases the volatility of the weekly variations of price quotes. These results establish the "day of the week" among the distinct characteristics of a price, a fact that must be taken into account while preparing calendars for CPI data collection. Weekday with Low Prices: Evidence on Daily Seasonality of Foods, Beverages and Tobacco Prices 2012-11-16T12:35:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{6AE024E8-6DD6-CF6F-519C-17190CDE32B1}.pdf Antonio Murillo Garza José Marcelo Delajara Delajara Marcelo; Murillo Garza José Antonio 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{E334B5A0-AEC4-47D5-DABC-249F8B74AB71}.pdf Bank of Mexico Working Papers by Chávez Juan Carlos; Fonseca Felipe J. Technical and Structural Efficiency in Mexican Manufacturing: A Regional Approach 2012-11-16T12:35:59Z This paper applies a stochastic frontier approach to analyze the evolution of technical efficiency in manufacturing as a source of regional growth, taking as a unit of analysis the Mexican states in the period 1988-2008. The main findings of our analysis are threefold. First, technical efficiency was increasing over the analyzed period and acted as a mechanism to reduce the labor productivity gap across states. Second, Mexican regions can increase manufacturing production about one third, on average, using the same amount of inputs which implies ample potential for regional growth. Third, there exists a considerable difference in the level of technological development, measured in terms of structural efficiency, of the north and the central regions with respect to the south that partially explains the labor productivity gap among regions. Technical and Structural Efficiency in Mexican Manufacturing: A Regional Approach 2012-11-16T12:35:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{E334B5A0-AEC4-47D5-DABC-249F8B74AB71}.pdf J. Fonseca Felipe Carlos Chávez Juan Chávez Juan Carlos; Fonseca Felipe J. 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{E3E1CF9B-128B-49EC-D268-F6B86290EAA2}.pdf Bank of Mexico Working Papers by Guerrero Santiago Who is Selling You Chiquilitros of Gasoline? Evidence From a Public Disclosure Policy 2012-11-16T12:35:59Z This paper estimates the impacts of disclosing information online and through the newspapers of gas stations that violate fuel supplying standards in Mexico. Using data from inspection histories, it finds that disclosing information online decreases the probability that any gas station would be found in violation in subsequent periods. Gas stations exposed in the newspapers are estimated to decrease their sales at the month of the newspaper publication. This effect fades with time and is not significant for subsequent months. The paper shows that public disclosure mechanisms can complement enforcement effort in contexts where institutions are weak. Who is Selling You Chiquilitros of Gasoline? Evidence From a Public Disclosure Policy 2012-11-16T12:35:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{E3E1CF9B-128B-49EC-D268-F6B86290EAA2}.pdf Santiago Guerrero Guerrero Santiago 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{D8D75FA7-C01B-BDC0-8069-23E31B5B50A7}.pdf Bank of Mexico Working Papers by Hernandez Vega Marco A. Real Exchange Rate Variations, Nontraded Goods and Disaggregated CPI Data 2012-11-16T12:35:59Z The behavior of the real exchange rate, measuring movements in the relative consumer price indexes between countries, remains a prominent puzzle in international macroeconomics. Two key theories of the real exchange rate differ in the role played by goods not traded internationally. On one hand, the theory of Balassa-Samuelson, on the other hand, models with sticky prices. This study provides new empirical evidence on nontraded goods importance in real exchange volatility by using more highly disaggregated data than used in previous literature on prices and trade between the U.S. and Mexico for the period 2002-2009. The main results suggest that the nontraded component accounts for between 69 and up to 84 percent of the real exchange rate volatility. In addition, the results show that the nontraded component is negatively correlated with the traded component despite both countries being in a flexible exchange rate regime contradicting previous literature. These results generally support the Balassa-Samuelson theory. Real Exchange Rate Variations, Nontraded Goods and Disaggregated CPI Data 2012-11-16T12:35:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{D8D75FA7-C01B-BDC0-8069-23E31B5B50A7}.pdf A. Hernandez Vega Marco Hernandez Vega Marco A. 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{BE248DA4-CDC7-721A-8941-6B5F0CED1CC7}.pdf Bank of Mexico Working Papers by Martínez-Jaramillo Serafín; Alexandrova-Kabadjova Biliana; Bravo-Benítez Bernardo; Solórzano-Margain Juan Pablo An Empirical Study of the Mexican Banking System's Network and its Implications for Systemic Risk 2012-11-16T12:35:59Z With the purpose of measuring and monitoring systemic risk, some topological properties of the interbank exposures and the payments system networks are studied. We propose non-topological measures which are useful to describe the individual behavior of banks in both networks. The evolution of such networks is also studied and some important conclusions from the systemic risks perspective are drawn. A unified measure of interconnectedness is also created. The main findings of this study are: the payments system network is strongly connected in contrast to the interbank exposures network; the type of exposures and payment size reveal different roles played by banks; behavior of banks in the exposures network changed considerably after Lehmans failure; interconnectedness of a bank, estimated by the unified measure, is not necessarily related with its assets size. An Empirical Study of the Mexican Banking System's Network and its Implications for Systemic Risk 2012-11-16T12:35:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{BE248DA4-CDC7-721A-8941-6B5F0CED1CC7}.pdf Pablo Solórzano-Margain Juan Biliana Alexandrova-Kabadjova Bernardo Bravo-Benítez Serafín Martínez-Jaramillo Martínez-Jaramillo Serafín; Alexandrova-Kabadjova Biliana; Bravo-Benítez Bernardo; Solórzano-Margain Juan Pablo 2012 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{69AB2E0F-40DF-8F49-0144-B4ECF08E608C}.pdf Bank of Mexico Working Papers by Lever Guzmán Carlos Price Competition on Network 2011-07-02T06:21:59Z We present a model of imperfect price competition where not all firms can sell to all consumers. A network structure models the local interaction of firms and consumers. We find that aggregate surplus is maximized with a fully connected network, which corresponds to perfect competition, and decreases monotonically as the network becomes less connected until firms become local monopolists. When we study which networks are likely to form in equilibrium, we find that stable networks are not fully connected but are connected enough to rule out local monopolists. Our results extend to oligopolistic competition when consumers can either buy from a single firm or from all firms. Price Competition on Network 2011-07-02T06:21:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{69AB2E0F-40DF-8F49-0144-B4ECF08E608C}.pdf Carlos Lever Guzmán Lever Guzmán Carlos 2011 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{0DD8BFAB-4815-FFDA-88FC-A0EF60A85882}.pdf Bank of Mexico Working Papers by Ibarra-Ramírez Raúl Stocks, Bonds and the Investment Horizon: A Spatial Dominance Approach 2011-06-15T06:21:59Z Financial advisors typically recommend that a long-term investor should hold a higher percentage of his wealth in stocks than a short-term investor. However, part of the academic literature disagrees with this advice. We use a spatial dominance test which is suited for comparing alternative investments when their distributions are time-varying. Using daily data for the US from 1965 to 2008, we test for dominance of cumulative returns series for stocks versus bonds at different investment horizons from one to ten years. We find that bonds second order spatially dominate stocks for one and two year horizons. For horizons of nine years or longer, we find evidence that stocks dominate bonds. When different portfolios of stocks and bonds are compared, we find that for long investment horizons, only those portfolios with a sufficiently high proportion of stocks are efficient in the sense of spatial dominance. Stocks, Bonds and the Investment Horizon: A Spatial Dominance Approach 2011-06-15T06:21:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{0DD8BFAB-4815-FFDA-88FC-A0EF60A85882}.pdf Raúl Ibarra-Ramírez Ibarra-Ramírez Raúl 2011 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{14EE8887-387E-251D-7F06-0A9631F55808}.pdf Bank of Mexico Working Papers by Covarrubias Enrique The Number of Equilibria of Smooth Infinite Economies 2011-05-25T06:23:59Z We construct an index theorem for smooth infinite economies that shows that generically the number of equilibria is odd. As a corollary, this gives a new proof of existence and gives conditions that guarantee global uniqueness of equilibria. The Number of Equilibria of Smooth Infinite Economies 2011-05-25T06:23:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{14EE8887-387E-251D-7F06-0A9631F55808}.pdf Enrique Covarrubias Covarrubias Enrique 2011 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{880F5DD7-D378-692E-945A-7313483BA70A}.pdf Bank of Mexico Working Papers by Kaiser Karen Variety Aversion and Information Overload: An Experimental Approach 2011-05-03T06:21:00Z This paper analyzes the effect of information overload on preference or aversion for variety. According to the model, a rational decision maker who suffers from information overload, faces a two-stage decision process, and is choosing from a set of unknown goods will find it optimal at some point to become variety averse. To test this hypothesis, an experiment is conducted, and its results, that subjects suffering from information overload use variety aversion as a strategy to deal with their cognitive limitations, are consistent with the model. Moreover, results suggest that subjects are, on the average, choosing the optimal number of goods. As the price of the goods increases, subjects become more variety averse. In addition, as they become more experienced, they prefer larger sets of goods. Variety Aversion and Information Overload: An Experimental Approach 2011-05-03T06:21:00Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{880F5DD7-D378-692E-945A-7313483BA70A}.pdf Karen Kaiser Kaiser Karen 2011 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{85A22835-4272-F218-10F8-412344010F8B}.pdf Bank of Mexico Working Papers by Chortareas Georgios E.; Garza-Garcia Jesus Gustavo; Girardone Claudia Banking Sector Performance in Some Latin American Countries: Market Power versus Efficiency 2010-12-20T12:37:59Z The wave of consolidation and the rapid increase in market concentration that took place in most Latin American countries has generated concerns about the rise in banks' market power and its potential effects on consumers. This paper advances the existing literature by testing the market power (Structure-Conduct-Performance and Relative Market Power) and efficient structure (X- and scale efficiency) hypotheses for a sample of over 2,500 bank observations in nine Latin American countries over 1997-2005. We use the Data Envelopment Analysis technique to obtain reliable efficiency measures. We produce evidence supporting the efficient structure hypotheses. Finally, capital ratios and bank size seem to be among the most important factors in explaining profits for these Latin American banks. Banking Sector Performance in Some Latin American Countries: Market Power versus Efficiency 2010-12-20T12:37:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{85A22835-4272-F218-10F8-412344010F8B}.pdf Georgios Chortareas Gustavo Garza-Garcia Jesus Claudia Girardone Chortareas Georgios E.; Garza-Garcia Jesus Gustavo; Girardone Claudia 2010 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{C4213F73-8E2F-0E2B-E719-F728CEE8EA64}.pdf Bank of Mexico Working Papers by Martínez André; Viarengo Martina; Musacchio Aldo The Great Leap Forward: The Political Economy of Education in Brazil, 1889-1930 2010-12-16T06:23:00Z Recent research links the inequality across countries and regions to colonial institutions. This paper argues that trade shocks could alter the development path of a country or subnational units, in spite of its colonial institutions. This hypothesis is analyzed using state-level data for Brazil, a country with high regional heterogeneity in endowments. We find that positive trade shocks, or improvements in export tax revenues, increased expenditures on education per capita and education outcomes in the period 1889 to 1930. In fact, trade shocks ended up altering the inequality in education levels across states in a permanent way. The paper ends by explaining why politicians spent windfall tax revenues to invest on education. The Great Leap Forward: The Political Economy of Education in Brazil, 1889-1930 2010-12-16T06:23:00Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{C4213F73-8E2F-0E2B-E719-F728CEE8EA64}.pdf Martina Viarengo Aldo Musacchio André Martínez Martínez André; Viarengo Martina; Musacchio Aldo 2010 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{F02402AE-3A77-B473-1C9D-22DE8A22CBC9}.pdf Bank of Mexico Working Papers by De la Garza Adrián; Mastrobuoni Giovanni; Sannabe Atsushi; Yamada Katsunori The Relative Utility Hypothesis With and Without Self-reported Reference Wages 2010-12-16T06:23:00Z This article uses survey data of workers in Japan to study the effects of own and self-reported reference wages on subjective well-being. Higher wages lead to higher life and job satisfaction. When workers perceive that their peers earn higher wages, they report lower well-being. We compare our results with relative utility tests in the literature and develop a generalized version of the classical measurement error model to show that the estimated bias of the reference wage effect can go in both directions. We propose an IV strategy when the self-reported reference wage is not available that does not eliminate the bias but delivers a lower bound of the "true" effect. The Relative Utility Hypothesis With and Without Self-reported Reference Wages 2010-12-16T06:23:00Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{F02402AE-3A77-B473-1C9D-22DE8A22CBC9}.pdf Giovanni Mastrobuoni Katsunori Yamada Atsushi Sannabe Adrián De la Garza De la Garza Adrián; Mastrobuoni Giovanni; Sannabe Atsushi; Yamada Katsunori 2010 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{F4447369-7102-0A6D-891F-F34AB07D2981}.pdf Bank of Mexico Working Papers by Lever Guzmán Carlos Strategic Spending in Voting Competitions with Social Networks 2010-12-15T06:21:59Z I propose a model of voting competitions (political campaigns and strategic lobbying) where voters are influenced by the opinion of their neighbors on a social network. In the unique pure strategy nash equilibrium, resources are targeted toward individuals with an influential position in the network. This finding contrasts with previous theories on strategic spending which predict that parties (or lobbies) should spend more on individuals who have a higher probability of being pivotal for the vote. I next test the model using data on campaign contributions by interests groups in the US. House of Representatives. I find that both network influence and pivotality are significant predictors of campaign contributions. Strategic Spending in Voting Competitions with Social Networks 2010-12-15T06:21:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{F4447369-7102-0A6D-891F-F34AB07D2981}.pdf Carlos Lever Guzmán Lever Guzmán Carlos 2010 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{DFEC9239-3798-C4E6-0792-A67EBF5B345B}.pdf Bank of Mexico Working Papers by Abarca Gustavo; Rangel José Gonzalo; Benavides Guillermo Exchange Rate Market Expectations and Central Bank Policy: The case of the Mexican Peso-US Dollar from 2005-2009 2010-12-15T06:21:59Z We examine two approaches characterized by different tail features to extract market expectations on the Mexican peso-US dollar exchange rate. Expectations are gauged by risk-neutral densities. The methods used to estimate these densities are the Volatility Function Technique (VFT) and the Generalized Extreme Value (GEV) approach. We compare these methods in the context of monetary policy announcements in Mexico and the US. Once the surprise component of the announcements is considered, our results indicate that, although both VFT and GEV suggest similar dynamics at the center of the distribution, these two methods show significantly different patterns in the tails. Our empirical evidence shows that the GEV model captures better the extreme values. Exchange Rate Market Expectations and Central Bank Policy: The case of the Mexican Peso-US Dollar from 2005-2009 2010-12-15T06:21:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{DFEC9239-3798-C4E6-0792-A67EBF5B345B}.pdf Guillermo Benavides Gustavo Abarca Jose Gonzalo Rangel Abarca Gustavo; Rangel José Gonzalo; Benavides Guillermo 2010 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{22F5356A-CBD1-D3F1-C30B-4804A150E40D}.pdf Bank of Mexico Working Papers by Alcaraz Carlo; Chiquiar Daniel; Salcedo Alejandrina Remittances, Schooling, and Child Labor in Mexico 2010-10-29T06:21:59Z This paper studies the effects of remittances from the U.S. on child labor and school attendance in recipient Mexican households. We identify these effects using the impact of the 2008-2009 U.S. recession on remittance receipts. The methodology employed is a differences-in-differences strategy that compares households that were remittance recipients before the crisis with never-recipient households. To avoid possible selection problems, we instrument for membership in the remittance recipient group. We find that the negative shock on remittance receipts caused a significant increase in child labor and a significant reduction of school attendance. Remittances, Schooling, and Child Labor in Mexico 2010-10-29T06:21:59Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{22F5356A-CBD1-D3F1-C30B-4804A150E40D}.pdf Daniel Chiquiar Alejandrina Salcedo Carlo Alcaraz Alcaraz Carlo; Chiquiar Daniel; Salcedo Alejandrina 2010 Bank of Mexico Working Papers http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{3D80DA42-A6AC-BB0C-9104-B145111BDE86}.pdf Bank of Mexico Working Papers by Benavides Guillermo Forecasting Short-Run Inflation Volatility using Futures Prices: An Empirical Analysis from a Value at Risk Perspective 2010-10-28T06:23:00Z In this research paper ARCH-type models are applied in order to estimate the Value-at-Risk (VaR) of an inflation-index futures portfolio for several time-horizons. The empirical analysis is carried out for Mexican inflation-indexed futures traded at the Mexican Derivatives Exchange (MEXDER). To analyze the VaR with time horizons of more than one trading day bootstrapping simulations were applied. The results show that these models are relatively accurate for time horizons of one trading day. However, the volatility persistence of ARCH-type models is reflected with relatively high VaR estimates for longer time horizons. These results have implications for short-term inflation forecasts. By estimating confidence intervals in the VaR, it is possible to have certain confidence about the future range of inflation (or extreme inflation values) for a specified time horizon. Forecasting Short-Run Inflation Volatility using Futures Prices: An Empirical Analysis from a Value at Risk Perspective 2010-10-28T06:23:00Z Full text http://www.banxico.org.mx/publicaciones-y-discursos/publicaciones/documentos-de-investigacion/banxico/{3D80DA42-A6AC-BB0C-9104-B145111BDE86}.pdf Guillermo Benavides Benavides Guillermo 2010 Bank of Mexico Working Papers