The Income and Consumption Effects of Covid-19 and the Role of Public Policy
This paper provides empirical evidence on how the labour market impacts of the covid-19 pandemic vary across workers’ incomes, assets, characteristics and household structures in the UK. Using data from the UK Household Longitudinal Study, we find that less educated and young workers are most likely to be laid-off. This is particularly the case for females. Moreover, less educated workers tend to have low income and low assets, limiting their ability to maintain consumption in the face of reduced income. This is compounded at the household level by assortative partnering between workers with similar education levels. We analyse the source of these inequalities by relating employment outcomes to factors related occupational and industrial characteristics. We then conduct a quantitative assessment of the likely impact of covid-19 on households’ consumption and find that, because the adverse labour market impacts are concentrated on workers with low income and low assets, 70 percent of households in the bottom fifth of the income distribution cannot maintain their usual expenditure for even one week. Finally, we consider the effectiveness and distributional implications of two different policy interventions: the Coronavirus Job Retention Scheme in the UK and Economic Impact Payments in the US. Our findings suggest that both policies can alleviate the increase in consumption inequality that would have otherwise arisen during the pandemic. In the short term, the US-style one-off payment is most effective at providing affected households with the means to smooth consumption. However, the CJRS provides better insurance against prolonged disruption as the program provides continuous income support.
Common Ownership, Domestic Competition, and Export: Evidence from Thailand
We use administrative data of all registered firms in Thailand, both public and private, to study the relationships between common ownership, market power, and firms’ export behaviors. Our results suggest that firms in ownership networks tend to have higher market power as measured by markup. In addition, markup is negatively associated with a firm’s propensity to export, its likelihood of product upgrade, and the chance of survival in foreign markets. Our findings have policy implications on antitrust regulations and competitiveness policies, especially in export-oriented economies dominated by powerful business conglomerates.
Understanding the Bimodality of the Export Intensity Distribution in Thailand
The literature has established a pattern that exporters in developed countries sell most of their output in their domestic markets. However, recent evidence finds that firm-level export intensity, defined as the ratio of exports to revenue, in at least 47 countries is bimodally distributed. In this paper, we investigate the determinants of the bimodality of Thailand’s export intensity distribution by using Thailand’s manufacturing firm-level census data covering the period between 2007-2017. We do not find evidence that firm productivity can explain the variation in export intensity. We document that firms with export intensity at least 90 percent, so-called “pure exporters,” can be explained by (i) the firm’s characteristics, (ii) the demand-side factor, and (iii) the government’s policy. Pure exporters are relatively young, have foreign ownership, produce narrow product variety, and export to high-income countries. The government’s policy, such as investment promotion, can raise firms’ export intensity and encourage firms to become pure exporters, there by emphasizing another important channel through which the government can increase exports.
Cash flow uncertainty and IPO underpricing: Evidence from Thai REITs
REIT IPOs in Thailand are less underpriced than stock IPOs (2.45% compared to 23.0%), which is a common finding across many international markets (Chan, Chen and Wang, 2013). One of the most common explanations for IPO underpricing is adverse selection arising from information asymmetry. However, research in IPO tends not to investigate this issue directly due to the difficulty in estimating ex-ante uncertainty. REITs provide a unique research setting because some REITs enjoy income guarantee, which can reduce cash flow uncertainty. We find that REITs with income guarantee are much less underpriced on average, corroborating the linkage between cash flow uncertainty and IPO underpricing. We confirm that REITs with income guarantee tend to have lower systematic risk (measured by CAPM beta) and returns, making the nature of some REITs more debt-like than equity-like.
Effect of Minimum Wage on Changes in the Thai Labor Market
This study evaluates the effect of the minimum wage on changes in the Thai labor market from 2002 to 2010, when the real minimum wage gradually decreased, and 2011 to 2013 when the real minimum wage substantially increased. These changes include labor force participation, employment, dis-employment, weekly working hours, real hourly wages, real hourly total labor income, and various other types of income. This study