Enisa wins scholarship to attend Brussels Summer School

The School of Economics would like to congratulate second year Economics student Enisa Marku who was recently awarded a scholarship to attend Kent Summer School in Brussels in June. We caught up with Enisa to find out a little more about this fantastic opportunity.

What made apply to the summer scheme? 
I wanted to experience something new and maybe have something interesting to add to my CV. I chose the Brussels Summer School because I felt that the sessions covered really interesting topics. I’m from Italy, my parents are migrants that came to Italy from Albania in the 90’s: Therefore, the migrants issue is something that touches me. Also, I am from Italy and I decided to move to study in the UK and the summer before I moved, the Brexit referendum result came out.

This made me think: I come from an EU country, and I now live in one that chose to leave the EU. I wonder whether this will affect my EU citizenship rights, whether something will change for me, for my studies and for my rights of staying in the UK. In the summer school all these topics will be covered. It’s also a once in a lifetime experience. I don’t know if I will be able to spend two weeks somewhere learning about something new when I will start working. So I thought I should definitely seize the opportunity and give it a go.

What are you going to study at the summer school and what activities are planned?
The Summer School is two weeks long and everyday I will have to attend 4 hours of lectures and talks held by many subject experts. The main focus of the summer school is going to be the EU as a global organisation. We will therefore learn what the EU is and what being an EU citizen means. The role of the EU when it comes to global issues, referring to organisations like NATO and focusing on the migrant issue. We will also explore the topics related to Brexit. At the end, each group of students will have to present their own project related to what they have learnt in the two preceding weeks. Two days will be dedicated to trips: one to the EU Parliament and the other to Mons (a city near Brussels), and there will be a final elegant dinner to celebrate the end of the experience.

What are you looking forward to most?
Brussels has always been a place I wanted to visit and now I am looking forward to experiencing two full weeks of life there. I am sure I will have a great time. I know there will be students from different backgrounds and different countries from which I can learn new things and further widen my horizons. I can’t wait to visit the EU Parliament and all those places I usually see on TV and where important decisions are made. There will be serious moments where I will have lectures and I will have to squeeze my brain and try to understand all the new concepts. I will learn about topics I do not directly study for my Economics degree but that may be useful sooner or later.

I will also have time to go around and visit the city and the wonderful attractions such as the museums and the castles and, why not, enjoy some nice chocolate gauffre and french fries!

We wish Enisa all the best for her summer school experience in Brussels and look forward to finding out how she gets on when she returns!

Money, Macro and Finance PhD Conference

The School of Economics is pleased to be hosting the 5th Money, Macroeconomics and Finance (MMF) PhD Conference on 19-20 April 2018.

The conference will include sessions on macro-labour; networks effects; macro-finance; international macro; macroeconometrics; and firms, chaired by academics from each of the sponsoring institutions.

Full details and the programme can be found on our website at https://www.kent.ac.uk/economics/research/MaGHiC/events/mmf-conference-apr18.html.

Sponsored by the Money, Macro and Finance Research Group; the Bank of England; the Macroeconomics, Growth and History Centre (MaGHiC), University of Kent; the Centre for International Macro Studies (CIMS), University of Surrey.

Building a new home for our School

Work has started on the new School of Economics, which is due to open its doors in September 2019. Despite the challenging conditions of the snow at the end of February, the ground floor slab was poured on time. Over the past few weeks, the Willmott Dixon team have been continuing to excavate the foundations and install bolt sets. They are set to install a structural steel frame this month and after this, the landscape will start to change very quickly on site, so watch this space, exciting things to come.

Prof Tony Thirlwall

A Life in Economics

Professor Tony Thirlwall has had an invited autobiographical essay published in the PSL Quarterly Review entitled ‘A Life in Economics’, spanning his life as an economist, from his schooldays in the 1950s to the present day, most of which he has spent at the University of Kent (from 1966).

The essay focuses particularly on his early work in the 1960s and 1970s on regional unemployment, inflation and growth; his defence of Keynesian economics against its critics in the 1970s and 1980s; the origins of his balance of payments constrained growth model (1979) which has spawned a large literature, and his involvement in the teaching, research and advisory work in the field of development economics.

You can read the complete essay here:
http://ojs.uniroma1.it/index.php/PSLQuarterlyReview/article/view/14283

Thirlwall A. P. (2018), “A life in economics”, PSL Quarterly Review, 71(284): 9-39.
DOI: 10.13133/2037-3643_71.284_2

Professor Miguel Leon-Ledesma

International Centre for Pension Management Award

A paper by Professor Miguel León-Ledesma on ‘Population structure and asset values’ has received the 2017 International Centre for Pension Management Award.

The paper, co-authored with Kate Rybczynski, Lori Curtis, Stephen Bonnar (University of Waterloo), Jaideep Oberoi (University of Kent), and Mark Zhou (CMHC), analyses the effect of changes in the age structure of population on the prize of risky and non-risky assets. Its results are important for the management of pension systems, as it helps forecasting future returns in countries where the age structure is rapidly changing towards a larger weight of pension-age population.

The prize, endowed with 10,000 CAD, will be used to fund further research in the area by the team. The paper also received the Best Paper Award 2018 by the International Conference of Actuaries 2018.

Professor Miguel Leon-Ledesma

Paper receives the 2017 International Centre for Pension Management Award

A paper by Professor Miguel León-Ledesma, entitled ‘Population structure and asset values’, has received the 2017 International Centre for Pension Management Award. The paper, co-authored with Kate Rybczynski, Lori Curtis, Stephen Bonnar (University of Waterloo), Jaideep Oberoi (University of Kent), and Mark Zhou (CMHC), analyses the effect of changes in the age structure of population on the prize of risky and non-risky assets. Its results are important for the management of pension systems, as they help to forecast future returns in countries where the age structure is rapidly changing towards a larger weight of pension-age population.

The prize, endowed with 10,000 CAD, will be used to fund further research in the area by the team. The paper also received the Best Paper Award 2018 from the International Conference of Actuaries 2018.

Research grant for study on marketing agricultural insurance through urban migrants

The School of Economics will participate in a major study, funded by the International Initiative for Impact Evaluation (3ie), on marketing formal insurance to smallholder farmers in Burkina Faso through their urban migrant family networks. The study will be led by Dr Harounan Kazianga (Oklahoma State University) and Dr Zaki Wahhaj (University of Kent) in partnership with Innovations for Poverty Action and the micro-insurance provider Planet Guarantee.

Last year a pilot study by the same team demonstrated that the potential client base for formal index-based insurance in developing countries is substantially larger than those directly engaged in rural farming, with significant demand from urban migrants with rural family links. The present study will look at the impact of this marketing strategy on the livelihoods of both rural farmers and urban migrants. Its wider objective is to investigate whether marketing formal index insurance to urban migrants with rural family ties is a viable strategy for increasing use of formal insurance among rural farmers in developing countries.

The study, with a total funding of USD 430,000 over the period 2018-2022 is one of six projects worldwide funded by 3ie under its evaluation programme on agricultural insurance.

Photo: Drs Kazianga and Wahhaj in Ouagadougou in 2017 with IPA country director Nicolo Tomaselli and research assistant Oumar Sory.

Keynes College

Workshop on production function estimation

Drs Olena Nizalova and Ilhan Guner held a workshop for staff and research students on production function estimation techniques on 29 March 2018.

The workshop was delivered by Olena’s co-author, Dr Oleksandr Shepotylo (University of Bradford), who demonstrated different production function estimation techniques and talked about various issues relating to production function estimation such as measurement errors in inputs, revenue and quantity based production function, estimation of production function for multiproduct firms, measurement of markups and other important firm level statistics.

Keynes College

Swale Academies Trust visits School of Economics

On Friday 23 March, we welcomed a group of students from two schools within the Swale Academies Trust. At the start of the day, students from the North School, Ashford and the Community College Whitstable were joined by Dr Joe Watkins from the School of Mathematics, Statistics and Actuarial Science, who ran an entertaining session on the ‘Maths of Juggling’.

Afterwards, PhD students Guillermo, Kemi, Mumba and Yannis led fun and engaging sessions to give students a basic understanding of economic principles, game theory, and how their maths skills can be applied. They delivered two workshops focused on the Prisoner’s Dilemma and the Law of Diminishing Returns. After lunch, the students went on a short tour of the campus with Undergraduate Student Ambassadors.

The day finished with a prize presentation for the students who had accumulated the most points from the day’s activities, including a School of Economics hoodie and Easter eggs. The School would like to thank everyone who was involved, especially Guillermo, Kemi, Mumba and Yannis who put so much enthusiasm into the sessions that they delivered.

Labor Responses, Regulation and Business Churn in a Small Open Economy

by Marta Aloi, University of Nottingham, Huw Dixon, Cardiff University and Anthony Savagar, University of Kent. Discussion paper KDPE 1804, February 2018.

Non-technical summary:

A long-standing debate in macroeconomics is whether labor hours initially increase or decrease across the economy following a technology improvement. We develop a theory that reconciles both outcomes by observing that:

1. New firms enter the economy slowly after a technology improvement. That is, entry is not instantaneous as often assumed.

2. At the firm-level labor can be employed with increasing or decreasing returns in production. Therefore, the division of labor across units (firms) affects its efficiency, which is not the case with constant returns, as often assumed.

Given these observations, an improvement in technology has the following effect. Firms already in the economy benefit from the technology. Output per firm and profit per firm increase without the firms changing anything in their production process due to the direct effect of a better technology. Aggregate labor will also respond instantaneously.

We ask: is this initial aggregate labor response greater or less than the level labor will settle down to over time?

The initial profits that incumbent firms earn from the technology improvement encourages entry by new firms. This takes place slowly because there are dynamic costs associated with entering, which can create an incentive for potential entrants to delay entry until a cheaper time. Slow entry means that for a short-while incumbents can enjoy high profits, and expanded output. But over time, entry takes place and as each new firm enters it will steal business until profits are at a level that does not make entering worthwhile for new firms due to the entry cost. As firms enter labor per firm decreases. If labor at the firm-level has increasing returns, then each new firm decreases labor efficiency, reduces wages and reduces hours. Therefore after the initial labor response, subsequent entry decreases labor. Hence there is short-run overshooting. Vice-verse for decreasing returns. If labor has constant returns then entry decreasing labor per firm does not affect its efficiency, so the initial response of aggregate labor persists forever.

Finally we show that the speed which firms adjusts depends on regulation of the entry process. A deregulatory policy will hasten the speed of firm adjustment, which makes the initial response of labor less persistent.

You can download the complete paper here.