| 1. |
- Bask, Mikael, 1967-, et al.
(författare)
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Language Tone in Financial News Media and the Cross-Section of Stock Returns
- 2020
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- Based on 58,256 news articles published in the Financial Times during a 15-year period that cover companies in the DJIA, we find that a trading strategy that longs stocks with the most negative news and shorts stocks with the least negative news is not profitable. Consistent with this result, we also find that the sentiment factor derived from the negativism in the language tone in news articles is not a priced risk factor in the cross-section of stock returns. Nevertheless, the sentiment factor is significant for two-thirds of the stocks when it is added to well-known factor models.
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| 2. |
- Carozzi, Felipe, et al.
(författare)
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Divided They Fall : Fragmented Parliaments and Government Stability
- 2020
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- This paper studies how political fragmentation affects government stability. We show that each additional party with representation in Parliament increases the probability that the incumbent government is unseated by 4 percentage points. Governments with more resources at their disposal for bargaining are less likely to be replaced. When they are, new government leaders are younger and better educated, suggesting instability may induce positive selection. We interpret our results in light of a bargaining model of coalition formation featuring government instability. Our findings indicate that the rising fragmentation in parliaments worldwide may have a substantial impact on stability and political selection.
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| 3. |
- Hernnäs, Sofia
(författare)
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Automation, Task Content and Occupations when Skills and Tasks are Bundled
- 2020
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- Automation affects workers because it affects the task content of their occupations. I propose a model which takes two important labor market features into account: (i) automation happens to tasks and (ii) workers with bundled skills work in occupations with bundled tasks. Equilibrium skill returns vary across occupations, and the impact of automation on skill returns is occupation-specific. Using my framework, I find that skill returns in the automated task decline if tasks are gross complements, consistent with much previous literature. Inequality increases in the occupation that is least intensive in the automated task, consistent with the development in Sweden 1985 - 2013. More generally, the model allows exploring how automation of one task affects the task content of occupations, returns to tasks, workers’earnings and inequality.
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| 4. |
- Karadja, Mounir, et al.
(författare)
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A response to Pettersson-Lidbom’s “Exit, Voice and Political Change: Evidence from Swedish Mass Migration to the United States – a Comment”
- 2020
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- In a comment to Karadja & Prawitz (2019), henceforth KP, Per Pettersson-Lidbom (2020), henceforth P-L, argues that the main results in KP are severely biased. He argues that KP's results are biased due to non-classical measurement error in emigration and due to confounders related to the instrument. In this response, we show that P-L's reasoning regarding measurement error bias contradicts the results from his proposed test. More generally, P-L's results cannot exclude alternative and arguably more likely explanations. We present two straightforward tests that both indicate that measurement error does not bias KP's results. Second, we argue that KP controls for confounders in a standard way given the identication strategy. Including fixed effects at the level of the exogenous cross-sectional variation, as P-L does, severely limits the available identifying variation and decreases precision. Nevertheless, we document that KP's results are robust to non-linear frost shock controls, including fixed effects for groups of similar frost shocks. In addition, we show that our results are robust to altering regional fixed effects or dropping them altogether, in contrast to what is suggested by P-L.
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| 5. |
- Olsson, Kerstin
(författare)
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How do monetary policy announcements affect inflation expectations?
- 2020
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- This paper examines the effects of policy rate announcements on households' inflation expectations over the time period 2003-2015. The effect is estimated using a two-stage least squares regression model. The announced changes are instrumented by a monetary policy surprise variable obtained from high-frequency swap trade data. The effect of an announced increase in the policy rate on inflation expectations is significant and positive. According to the New-Keynesian model, the effect of an exogenous monetary policy shock depends on the assumptions made on the persistence of the shock process in the model. Alternatively, the results may be interpreted as the policy announcement signalling the central bank's private information on the direction of future inflation. Given the sizeable weight of housing costs in the Swedish CPI basket, the results may also be interpreted as reflecting the direct effect of interest rates on the CPI. In this case, households internalize the effects of interest rates on CPI, when forming expectations about the future rate of inflation.
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| 6. |
- Sandström, Maria
(författare)
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Intangible Capital, Markups and Profits
- 2020
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- Can an increasing importance of intangible capital explain increases in markups and profits? I use a heterogeneous firm model to show how intangible capital, characterized by fixed costs and uncertainty, is related to markups and profits at the industry level. The scalability and uncertainty properties of intangible capital imply that firms which succeed in their intangible capital investment can charge high markups relative to other firms whereas firms that fail will exit. However, these high markups do not imply any economic profits in the industry if they only serve to cover the total fixed costs of intangible capital. To empirically examine the relationship between intangible capital, markups and prots, I study average markups and profit shares in a panel of Swedish industries. There is evidence of a positive relationship between intangible capital and average industry markups. However, the evidence of the relationship between intangible capital and profits is less conclusive.
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