Economics

Permanent URI for this collectionhttps://hdl.handle.net/10679/316

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Open Access
The asymmetric impact of oil prices, interest rates and oil price uncertainty on unemployment in the US
(Elsevier, 2020-02-01) Kocaaslan, B.; Soytas, U.; Soytaş, Mehmet Ali; Economics; SOYTAŞ, Mehmet Ali
In this study, we investigate the presence of asymmetric interactions between oil prices, oil price uncertainty, interest rates, and unemployment in a cointegration framework. Utilizing the nonlinear auto-regressive distributed lag (NARDL) approach, we show the asymmetric responses of unemployment to changes in oil prices, oil price uncertainty and interest rates in the long-run. More specifically, the results of our analyses suggest that an increase in oil price results in increased unemployment while there is no significant impact of reduced oil prices. On the one hand, reduced oil price uncertainty leads to a decrease in unemployment whereas an increase in oil price uncertainty does not have an impact. We also observe increased unemployment in response to a decrease in interest rates as the impact of increased interest rates is not significant. Last but not least, we find that option-implied oil price volatility, as a measure of oil price uncertainty, outperforms the conditional volatility of crude oil prices in predicting unemployment. This study provides valuable implications for policymakers to design sound economic policies.
Open Access
Corporate sustainability interactions: A game theoretical approach to sustainability decisions
(Elsevier, 2019-12) Soytaş, Mehmet Ali; Uşar, Damla Durak; Denizel, M.; Soytaş, Mehmet Ali; Uşar, Damla Durak
Recent global developments lead companies to include into their strategic plans not only economic sustainability but environmental and social sustainability as well. Companies have been investing in environmental and social sustainability to meet stakeholder demand and/or regulatory demands. Considering this as a market mechanism, we view the sustainability actions of companies as interrelated strategic decisions and propose a Stackelberg game to model the effects of competition for sustainability and sustainability spillovers over the sustainability outcomes of companies. We provide equilibrium solutions for the one leader, two followers game over different intervals of competition levels and spillover rates. Using a numerical example, we observe how the sustainability investments and net benefits change as competition levels and spillover rates change and identify the competition-spillover regions, where each player invests the most and has the advantage in terms of benefit. We discuss implications for both the companies and the policy makers.
Open Access
Domine edilen statükonun referans etkisi
(Okan Üniversitesi, 2018-05) Güney, Begüm; Economics; GÜNEY, Begüm
Statüko, bir kişinin şu anki konumunu temsil eder. Çalışılan iş ve yaşanılan şehir statüko için verilebilecek örnekler arasındadır. Bir statüko, kendi seçilmese bile, diğer alternatifler arasındaki göreceli sıralamayı değiştirerek kişinin bu alternatifler arasındaki seçimini etkileyebilir ve buna “referans etkisi” denir. Bu çalışmada, statükoların referans etkisini anlamak için Özyeğin Üniversitesi lisans öğrencileri arasında bir anket yapılmıştır. Anket, Qualtrics programı kullanılarak hazırlanmış ve katılımcıların e-posta adreslerine tek kullanımlık bir bağlantı gönderilerek öğrencilerle paylaşılmıştır. Ankette katılımcılardan, depolama kapasitesi ve pil ömrü ile tanımlanmış farklı telefonlar arasında seçim yapmaları istenmiştir. Görülmüştür ki, statüko diğer alternatiflerin her biri tarafından domine edildiğinde - yani diğer alternatiflerden hem pil ömrü hem depolama kapasitesi bakımından daha kötü olduğunda - ve kendi seçilmediğinde bile, kişinin bu alternatifler arasındaki seçimini değiştirebilir. İstatistiki olarak anlamlı miktarda kişinin, aynı kümeden statüko varlığında ve yokluğunda yaptığı seçimlerin farklı olduğu görülmüştür. Bu davranış, literatürdeki teorik statüko modelleri arasından ancak sürekli referans etkisine izin verenler (Guney ve Richter, 2017) tarafından açıklanabilmektedir.
Open Access
Dynamic durable goods monopoly and market power
(MDPI, 2020-06) Özener, Başak Altan; Economics; ÖZENER, Başak Altan
We analyze a vertically differentiated market for an imperfectly durable good served by a monopolist in an infinite-horizon, discrete-time game. Our goal is to identify the Markov perfect stationary equilibria where the seller can maintain his monopoly power. We establish that the set of parameters supporting a monopoly outcome is larger when the seller offers different quality versions of the same product. Hence, our results suggest that, when the innate durability of a product is high, the seller should offer different quality versions of the product.
Open Access
Estimation of dynastic lifecycle discrete choice models
(Wiley, 2018-11) Gayle, G. - L.; Golan, L.; Soytaş, Mehmet Ali; Economics; SOYTAŞ, Mehmet Ali
This paper explores the estimation of a class of life‐cycle discrete choice dynastic models. It provides a new representation of the value function for these class of models. It compare a multistage conditional choice probability (CCP) estimator based on the new value function representation with a modified version of the full solution maximum likelihood estimator (MLE) in a Monte Carlo study. The modified CCP estimator performs comparably to the MLE in a finite sample but greatly reduces the computational cost. Using the proposed estimator, we estimate a dynastic model and use the estimated model to conduct counterfactual simulations to investigate the role Nature versus Nurture in intergenerational mobility. We find that Nature accounts for 20 percent of the observed intergenerational immobility at the bottom of income distribution. That means that 80 percent of mobility at the bottom of the income distribution is explained by economic decision and economic/institutional constraints.
Open Access
Fragile transitions from education to employment Youth, gender and migrant status in the EU
(Taylor & Francis, 2019) Çelik, Ç.; Gökşen, F.; Filiztekin, Orhan Alpay; Öker, İ.; Smith, M.; Economics; FİLİZTEKİN, Orhan Alpay
N/A
Open Access
Games with switching costs and endogenous references
(Wiley, 2022-05-25) Güney, Begüm; Richter, M.; Economics; GÜNEY, Begüm
We introduce a game-theoretic model with switching costs and endogenous references. An agent endogenizes his reference strategy, and then taking switching costs into account, he selects a strategy from which there is no profitable deviation. We axiomatically characterize this selection procedure in one-player games. We then extend this procedure to multiplayer simultaneous games by defining a Switching Cost Nash Equilibrium (SNE) notion, and prove that (i) an SNE always exists; (ii) there are sets of SNE, which can never be a set of Nash equilibrium for any standard game; and (iii) SNE with a specific cost structure exactly characterizes the Nash equilibrium of nearby games, in contrast to Radner's (1980) ε-equilibrium. Subsequently, we apply our SNE notion to a product differentiation model, and reach the opposite conclusion of Radner (1980): switching costs for firms may benefit consumers. Finally, we compare our model with others, especially Köszegi and Rabin's (2006) personal equilibrium.
Open Access
Inequalities in the geographical distribution and workload of obstetrics and gynaecology specialists by gender in Turkey
(World Health Organization, 2022-06) Erus, B.; Tuncay Alpanda, Berna; Economics; ALPANDA, Berna Tuncay
Background: Women often have a preference for female obstetrics and gynaecology specialists (ob/gyns). Following the policy allowing physician selection by patients in Turkey, distribution of ob/gyns by gender across provinces has been an important indicator of access to healthcare. Aims: To analyse ob/gyns distribution by gender across provinces in Turkey, with emphasis on the relationship with conservativeness of the province and resulting physician workload. Methods: We measured the number of male and female ob/gyns by province in 2016 and the number of outpatient visits and deliveries performed by male and female ob/gyns in 2015. Pearson and Spearman correlation of the female ratio with votes for conservative parties was used to assess the distribution of ob/gyns. We then analysed the correlation with resulting workload of female ob/gyns and ran linear regressions of these variables controlling the number of ob/gyns in a province. Results: More conservative provinces, measured by the vote share for conservative political parties, have a higher ratio of female ob/gyns. Linear regression showed that a 1 percentage point (pp) increase in the vote share corresponded to a 0.69 pp increase in female ratio. For workload, a 1 pp higher female ratio resulted in a decrease in workload, measured as outpatient visits per female ob/gyn divided by that per male ob/gyn, by 0.014. Conclusion: Conservative provinces have more female ob/gyns, but other provinces compensate for that with higher female ob/gyn workload. High workload may have adverse health effects and result in lower quality of care.
Open Access
Intergenerational mobility and the effects of parental education, time investment, and income on children’s educational attainment
(Federal Reserve Bank of St.Louis, 2018-07-15) Gayle, G. - L.; Golan, L.; Soytaş, Mehmet Ali; Economics; SOYTAŞ, Mehmet Ali
This article analyzes the mechanisms through which parents’ and children’s education are linked. It estimates the causal effect of parental education, parental time with children, and parental income during early childhood on the educational outcomes of children. Estimating the causal effects of time with children, income, and parental education is challenging because parental time with children is usually unavailable in many datasets and because of the problem of endogeneity of parental income, time with children, and education. The authors, therefore, use an instrumental variables approach to estimate the causal effects. They find that once they account for the parental time input with children, parental income during the first five years is no longer statistically significant. The parental time investments of both parents in early childhood are each statistically and quantitatively significant determinants of the educational outcomes of children.
Open Access
A new estimation technique of sovereign default risk
(Elsevier, 2016-12-27) Soytaş, Mehmet Ali; Volkan, Engin; Economics; SOYTAŞ, Mehmet Ali; VOLKAN, Engin
Using the fixed-point theorem, sovereign default models are solved by numerical value function iteration and calibration methods, which due to their computational constraints, greatly limits the models' quantitative performance and foregoes its country-specific quantitative projection ability. By applying the Hotz-Miller estimation technique (Hotz and Miller, 1993)- often used in applied microeconometrics literature- to dynamic general equilibrium models of sovereign default, one can estimate the ex-ante default probability of economies, given the structural parameter values obtained from country-specific business-cycle statistics and relevant literature. Thus, with this technique we offer an alternative solution method to dynamic general equilibrium models of sovereign default to improve upon their quantitative inference ability.
Open Access
On approximate Nash equilibria of the two-source connection game
(TÜBİTAK, 2022) Çaşkurlu, B.; Açikalin, U. U.; Kizilkaya, F. E.; Ekici, Özgün; Economics; EKİCİ, Özgün
The arbitrary-sharing connection game is prominent in the network formation game literature [1]. An undirected graph with positive edge weights is given, where the weight of an edge is the cost of building it. An edge is built if agents contribute a sufficient amount for its construction. For agent i, the goal is to contribute the least possible amount while assuring that the source node si is connected to the terminal node ti. In this paper, we study the special case of this game in which there are only two source nodes. In this setting, we prove that there exists a 2-approximate Nash equilibrium that is socially optimal. We also consider the further special case in which there are no auxiliary nodes (i.e., every node is a terminal or source node). In this further special case, we show that there exists a 3/2 -approximate Nash equilibrium that is socially optimal. Moreover, we show that it is computable in polynomial time.
Open Access
On efficient computation of equilibrium under social coalition structures
(TÜBİTAK) Caskurlu, B.; Ekici, Özgür; Kizilkaya, F. E.; Economics; EKİCİ, Özgün
In game-theoretic settings the key notion of analysis is an equilibrium, which is a profile of agent strategies such that no viable coalition of agents can improve upon their coalitional welfare by jointly changing their strategies. A Nash equilibrium, where viable coalitions are only singletons, and a super strong equilibrium, where every coalition is deemed viable, are two extreme scenarios in regard to coalition formation. A recent trend in the literature is to consider equilibrium notions that allow for coalition formation in between these two extremes and which are suitable to model social coalition structures that arise in various real-life settings. The recent literature considered the question on the existence of equilibria under social coalition structures mainly in Resource Selection Games (RSGs), due to the simplicity of this game form and its wide range of application domains. We take the question on the existence of equilibria under social coalition structures from the perspective of computational complexity theory. We study the problem of deciding the existence of an equilibrium in RSGs with respect to a given social coalition structure. For an arbitrary coalition structure, we show that it is computationally intractable to decide whether an equilibrium exists even in very restricted settings of RSGs. In certain settings where an equilibrium is guaranteed to exist we give polynomial-time algorithms to find an equilibrium.
Open Access
On optimal toll design for bosporus crossings
(Sosyoekonomi Society, 2022-10) Ekici, Özgün; Economics; EKİCİ, Özgün
For many years, two toll bridges served commuter demand to cross the strait called Bosporus in Istanbul, Turkey. An underground connection called the Eurasian tunnel had been recently launched to relieve the strait's traffic. We study a simple transportation model that incorporates the forces that have come into play after the opening of the Eurasian tunnel. We find that for welfare maximisation, the premium paid for using the tunnel should be fixed in the two directions and not excessive. The current toll regime violates these features, and we recommend its amendment in light of our findings.
Open Access
Price and quality decisions of a service provider under heterogeneous demand
(Boğaziçi Üniversitesi, 2019) Özener, Başak Altan; Atahan, Pelin; Economics; Sectoral Education and Professional Development; ÖZENER, Başak Altan; DEMİRCİLER, Pelin Atahan
A monopolist service provider's quality and price decisions are analyzed in a vertically differentiated market where customers demand different quantities of a service. We find that depending on the relative sizes of the market segments and the difference in the valuations of different customers, the service provider may find it optimal to either offer a non-discriminating service or a discriminating service serving only high-valuation customers. The service provider never finds it optimal to serve the market segments that have low-valuation for quality when the discrimination strategy is optimal. © 2019 Bogazici Universitesi. All rights reserved.
Open Access
The productivity gap: Monetary policy, the subprime boom, and the post-2001 productivity surge
(Elsevier, 2015-03) Selgin, G.; Beckworth, D.; Bahadır, Berrak; Economics; BAHADIR, Berrak
It is widely believed that, in the wake of the dot.com crash, the Fed kept the federal funds target rate too low for too long, inadvertently contributing to the subprime boom. We attribute this and other Fed departures from a “neutral” policy stance to the Fed's failure to respond appropriately to exceptional rates of total factor productivity growth. We then show how the Fed, by adhering to a nominal GDP growth rate target, might have succeeded in maintaining such a neutral stance.
Open Access
The reset inflation puzzle and the heterogeneity in price stickiness
(Elsevier, 2015-11) Kara, Engin
New Keynesian models have been criticised on the grounds that they require implausibly large price shocks to explain inflation. Bils et al. (2012) show that, while these shocks are needed to reduce the excessive inflation persistence generated by the models, they give rise to unrealistically volatile reset price inflation. This paper shows that introducing heterogeneity in price stickiness in the models overcomes these criticisms directed at them. The incorporation of heterogeneity in price stickiness reduces the need for large price shocks. With smaller price shocks, the new model comes close to matching the data on reset inflation.
Open Access
Role of strategic interactions in corporate sustainability decisions: an empirical investigation
(Turkish Economic Association, 2017-01-01) Soytaş, Mehmet Ali; Uşar, Damla Durak; Economics; SOYTAŞ, Mehmet Ali; Uşar, Damla Durak
There is a large amount of empirical literature on the relationship between corporate sustainability and corporate financial performance. However, the literature considers company-specific aspects affecting the link but omits the influence of the competition. A firm’s gains from its sustainability efforts, however, depend on whether its industry competitors also perform sustainable actions—whether similar in type or different. Thus, we consider the sustainability decision making of companies to be of a strategic nature and show that strategic motives, typically ignored in the literature, can be an important factor in the process. We estimate an Instrumental Variable (IV) Probit model, using inclusion in the MSCI KLD 400 Social Index and draw on financial information from the Wharton Research Data Services COMPUSTAT dataset in order to identify the effect of competition. We find that the effect of competition on the likelihood of entry into the sustainability market is negative, but this is only true if the endogeneity is correctly taken into account. Probit estimates present an upward bias, which means that results from raw models can be misleading in designing policies on sustainability. Overall evidence suggests a central role for strategic motives in management’s sustainability decisions.
Open Access
Stochastic production planning with flexible manufacturing systems and uncertain demand: A column generation-based approach
(Elsevier, 2022) Elyasi, Milad; Özener, Başak Altan; Ekici, Ali; Özener, Okan Örsan; Yanıkoğlu, İhsan; Economics; Industrial Engineering; ÖZENER, Başak Altan; EKİCİ, Ali; ÖZENER, Okan Örsan
The ongoing pandemic, namely COVID-19, has rendered widespread economic disorder. The deficiencies have delayed production at manufacturers in several industries on the supply side. The effects of disruption were more notable for industries with longer supply chains, especially reaching East Asia. Regarding the demand, sectors can be divided into three categories: i) the ones, like e-commerce companies, that experienced augmented demand; ii) the ones with a plunged demand, like what hotels and restaurants experience; iii) the companies experiencing a roller-coaster-ride business. After mitigation efforts, the economy started recovering, resulting in increased demand. However, regardless of their struggles, the companies have not fully returned to their pre-pandemic levels. One of the strategies to gain resilience in its supply chain and manage the disruptions is to employ flexible/hybrid manufacturing systems. This paper considers a flexible/hybrid manufacturing production setting with typically dedicated machinery to satisfy regular demand and a flexible manufacturing system (FMS) to handle surge demand. We model the uncertainty in demand using a scenario-based approach and allow the business to make here-and-now and wait-and-see decisions exploiting the cost-effectiveness of the standard production and responsiveness of the FMS. We propose a column generation-based algorithm as the solution approach. Our computational analysis shows that this hybrid production setting provides highly robust response to the uncertainty in demand, even with high fluctuations.
Open Access
Sustainable development from millennium 2015 to sustainable development goals 2030
(Wiley, 2019-07) Halisçelik, E.; Soytaş, Mehmet Ali; Economics; SOYTAŞ, Mehmet Ali
In modern economies, the advancement of well‐being of the citizens should be in an inclusive and sustainable way. In this respect, the sustainable welfare targets should exclusively include three main pillars: economic growth, social inclusion, and environmental protection. These pillars consist of qualitative and nonmonetary, as well as monetary and quantitative indicators to monitor. Although sustainable development today is well‐appreciated in most governments' agenda, yet it is generally not a trivial task to measure its progress especially due to multidimensional nature of some targets. In this article, sustainable development is measured by using a wide range of indicators within multidimensional perspective of Millennium Development Goals (MDGs) 2015. Indicators cover wide spectrum of areas such as poverty reduction, health, education, gender equality, and environment. An index creation method is developed for measuring the level and the performance of countries' progress through achieving MDGs. The index score levels and the rankings of countries are compared with similar indexes developed by United Nations. Finally, countries are classified according to their achievements relative to other countries (which is measured by the index) versus their self‐achievement performances (in terms of improvement of the index over years) in a big matrix. Results demonstrate the importance of measuring country performances in both dimensions. Understanding the progress in MDGs can help settle on binding targets for achieving the country specific goals in economic and noneconomic areas and on the mechanisms to implement the Sustainable Development Goals (SDGs) of the 2030, which set amid on the success of MDGs.
Open Access
Understanding household healthcare expenditure can promote health policy reform
(Cambridge University Press, 2023) Best, R.; Tuncay Alpanda, Berna; Economics; ALPANDA, Berna Tuncay
Studies of health care expenditure often exclude explanatory variables measuring wealth, despite the intuitive importance and policy relevance. We use the Household, Income and Labour Dynamics in Australia Survey to assess impacts of income and wealth on health expenditure. We investigate four different dependent variables related to health expenditure and use three main methodological approaches. These approaches include a first difference model and introduction of a lagged dependent variable into a cross-sectional context. The key findings include that wealth tends to be more important than income in identifying variation in health expenditure. This applies for health variables which are not directly linked to means testing, such as spending on health practitioners and for being unable to afford required medical treatment. In contrast, the paper includes no evidence of different impacts of income and wealth on spending on medicines, prescriptions or pharmaceuticals. The results motivate two novel policy innovations. One is the introduction of an asset test for determining rebate eligibility for private health insurance. The second is greater focus on asset testing, rather than income tests, for a wide range of general welfare payments that can be used for health expenditure. Australia's world-leading use of means testing can provide a test case for many countries.

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