Papers by Johanna Francis
Uzawa (1968) first introduced a simple and appealing method for reducing problems with variable r... more Uzawa (1968) first introduced a simple and appealing method for reducing problems with variable rates of time preference to single-state systems by transforming the time scale from t to ∆, a utility discount factor. This transformation has been used extensively, particularly in models of international trade and finance (e.g., Obstfeld, 1981a, 1981b, 1982, Engeland Kletzer, 1989, and Turnovsky, 1997), where the use of a variable rate of time preference avoids some of the “disturbing implications ” drawn from typical open-economy Ramsey models. The purpose of this paper, however, is to show that Uzawa’s transformation is valid only when the underlying system to be analyzed is autonomous. Unfortunately, except for the simplest control problems, this is rarely the case. In particular, systems with non-autonomous transition equations imply that the correspondence between ∆ and t is no longer unique, and thus Uzawa’s transformation is not applicable.
Uzawa (1968) first introduced a simple and appealing method for reducing problems with variable r... more Uzawa (1968) first introduced a simple and appealing method for reducing problems with variable rates of time preference to single-state systems by transforming the time scale from t to ∆, a utility discount factor. This transformation has been used extensively, particularly in models of international trade and finance (e.g., Obstfeld, 1981a, 1981b, 1982, Engeland Kletzer, 1989, and Turnovsky, 1997), where the use of a variable rate of time preference avoids some of the “disturbing implications” drawn from typical open-economy Ramsey models. The purpose of this paper, however, is to show that Uzawa’s transformation is valid only when the underlying system to be analyzed is autonomous. Unfortunately, except for the simplest control problems, this is rarely the case. In particular, systems with non-autonomous transition equations imply that the correspondence between ∆ and t is no longer unique, and thus Uzawa’s transformation is not applicable. Asia Pacific School of Economics and Go...
Entrepreneurs play a special role in cluster formation. Entrepreneurs start firms that capitalize ... more Entrepreneurs play a special role in cluster formation. Entrepreneurs start firms that capitalize on technological opportunities, adapting scientific breakthroughs and generic technologies to create new product markets and reorganize economic activity. Through ...
Eastern Economic Journal, 2012
Although the debate about the effect of wealth on entrepreneurship or self-employment is now almo... more Although the debate about the effect of wealth on entrepreneurship or self-employment is now almost two decades old, there is little consensus among researchers about the significance of wealth as a determinant for self-employment. In this paper, we shift the focus from whether potential entrepreneurs, as a group, are credit constrained, to whom among potential entrepreneurs is credit constrained. We consider the impact of education and experience on the probability of choosing self-employment, in an environment where individuals may be credit constrained. We find that for individuals with low human capital, wealth and entrepreneurial entry are negatively related, while wealth has no statistically significant effect on entry for individuals with medium to high human capital. This result is puzzlingly at odds with the classic Evans-Jovanovic model for entrepreneurial entry. We discuss one possibility for reconciling the two.
UMI, ProQuest ® Dissertations & Theses. The world's most comprehensive collection of dissert... more UMI, ProQuest ® Dissertations & Theses. The world's most comprehensive collection of dissertations and theses. Learn more... ProQuest, Saving, investment, and the entrepreneurship decisions of the wealthy. by Francis, Johanna ...
Industrial Clusters and Complexity: Theories, …, 2002
Abstract: This paper outlines the development of a high-tech industrial cluster through the effor... more Abstract: This paper outlines the development of a high-tech industrial cluster through the efforts of entrepreneurs who adapted to both constructive crises and new opportunities, creating the factors and conditions that facilitated their business interests. We examine the initial ...
We construct two sides of quarterly gross credit reallocation for the U.S. economy: business borr... more We construct two sides of quarterly gross credit reallocation for the U.S. economy: business borrowing gross flows of publicly traded companies and bank lending gross flows of commercial banks from the midto-late 1970s to 2012. We study the responses of credit creation, destruction, and reallocation for these two sides of credit relationships to a set of macroeconomic shocks-embodied and neutral technological shocks, monetary policy shocks, and excess bond premium shocks-in a structural vector autoregressive framework. Together, these shocks explain at most 20% of credit reallocation. Embodied technology shocks and excess bond premium shocks explain the largest portion of credit reallocation in lending but play a more limited role in explaining borrowing flows. We then study the different roles of allocative and aggregate shocks in driving cyclical movements in credit reallocation and find a sizably larger role for idiosyncratic shocks than for aggregate shocks. These results call for an important role for cross-sectional firm-level and bank-level heterogeneity in theoretical models with credit frictions.
Contributions to Economics, 2002
This paper outlines the development of a high-tech industrial cluster in the U.S. Capitol region ... more This paper outlines the development of a high-tech industrial cluster in the U.S. Capitol region through the efforts of entrepreneurs who adapted to both constructive crises and new opportunities. We examine the initial spark of entrepreneurship and how it influences the formation of high technology clusters. The perspective taken is that entrepreneurs are a critical element in the formation of clusters and their actions are important in the analysis of clusters as complex adaptive systems. In addition, we consider how this perspective and the role of entrepreneurship may influence economic development policy.
European Planning Studies, 2003
The accuracy of the Content should not be relied upon and should be independently verified with p... more The accuracy of the Content should not be relied upon and should be independently verified with primary sources of information. Taylor and Francis shall not be liable for any losses, actions, claims, proceedings, demands, costs, expenses, damages, and other liabilities whatsoever or howsoever caused arising directly or indirectly in connection with, in relation to or arising out of the use of the Content. This article may be used for research, teaching, and private study purposes. Any substantial or systematic reproduction, redistribution, reselling, loan, sub-licensing, systematic supply, or distribution in any form to anyone is expressly forbidden.
Economic Development Quarterly, 2004
The 1980s ushered in a new era in technology and economic development policy as a result of incre... more The 1980s ushered in a new era in technology and economic development policy as a result of increasing competitive pressure. Start-up companies built around commercializing new technologies developed in public or private labs were seen as a means to reinvigorate economies and renew industrial competitiveness in high-technology fields. This article considers the perspective of the small innovative firm and the question of what small technology-intensive firms want from state economic development programs. Drawing on a review of the literature and a series of case studies of cluster development, this article presents a set of stylized facts and policy recommendations.
Regional Studies, 2005
The objective of the paper is to provide a theoretical model of cluster development that is infor... more The objective of the paper is to provide a theoretical model of cluster development that is informed by an appreciative interpretation of case studies. It argues that entrepreneurs are a critical element in the formation of clusters. Entrepreneurs are important actors in the development of clusters as complex adaptive systems, where the external resources associated with clusters are developed over time. Entrepreneurs who adapt to both constructive crises and new opportunities create the factors and conditions that facilitate their business interests and, in turn, contribute to the development of external resources. The paper examines the initial factors that influence the decision to become an entrepreneur and examine how external factors influence the formation and location of high-technology clusters. Regional economic activity Growth Development and changes Regional development policy Innovation and invention: processes and incentives F M. P., F J. et B, J. (2005) L'e ´tablissment d'un regroupement au fur et a `mesure de la cre ´ation d'entreprise: les entrepreneurs et l'e ´tablissement des regroupements industriels, Regional Studies 39, 129-141. Cet article cherche a `construire un mode `le the ´orique du de ´veloppement des regroupements guide ´par une interpre ´tation sensible des e ´tudes de cas. On conside `re que les entrepreneurs constituent un facteur cle ´dans l'e ´tablissement des regroupements. Les entrepreneurs sont des agents importants dans le de ´veloppement des regroupements en tant que syste `mes complexes adaptables, ou `les ressources externes lie ´es aux regroupements se de ´veloppent sur le temps. Les entrepreneurs qui s'adaptent et aux crises avantageuses, et aux nouvelles possibilite ´s, cre ´ent les facteurs et les conditions qui favorisent leurs affaires et, a `leur tour, contribuent au de ´veloppement des ressources externes. On examine les premiers facteurs qui influencent la de ´cision individuelle de devenir entrepreneur, et on e ´tudie comment les facteurs externes influencent l'e ´tablissement et la localisation des regroupements qui sont a `la pointe de la technologie. Esprit d'entreprise Activite ´e ´conomique re ´gionale: croissance, de ´veloppement, et changement Politique d'ame ´nagement du territoire Innovation et invention: processus et incitations
Executive Summary .................................................................................. more Executive Summary ......................................................................................... 3 Introduction .................................................................................................... 5 Why are New Institutional Arrangements Required? ........................................ 5 Considering the Options ................................................................................... 7 Rationalizing a Voluntary Sector Commission ................................................... 9 The Charity Commission of England and Wales as a Case Study ..................... 11 How Would the New Voluntary Sector Commission Work? ............................. 16 An Alternative View ....................................................................................... 27 Conclusion ..................................................................................................... 32 Appendices ..................................................................
Journal of International Money and Finance, 2014
ABSTRACT We identify global and regional fluctuations in international private debt flows to emer... more ABSTRACT We identify global and regional fluctuations in international private debt flows to emerging and developing countries using data on cross-border loans and international bond issuance over 1993–2009. We use micro-level data on syndicated cross-border loans and international bond placements to estimate the effects of individual borrower characteristics as well as macroeconomic conditions on the cost of foreign borrowing and test whether these effects differ across phases of the lending cycle. First, we find that borrower characteristics associated with lower loan spreads are not necessarily associated with lower bond spreads. Second, we find differential effects of borrower characteristics between cycle phases for loans and bonds separately. Third, we find strong reductions in the cost of debt finance during periods when international debt flows are more than one standard deviation above their mean, but not for expansionary periods, when the growth rate of debt flows is increasing. We also find that higher trade ratios in the borrower's home country raise loan spreads more in periods of high credit flows but have no effect on bond spreads. At the same time, borrowers residing in countries with high investment ratios pay lower spreads on bond issuance particularly during periods of high credit flows, but we find no similar effect for loan spreads. Inflation rates, real exchange rates and previous banking crises have small impacts on loan and bond spreads.
International and Development Economics Working Papers, 2001
Abstract Uzawa (1968) first introduced a simple and appealing method for reduc-ing problems with ... more Abstract Uzawa (1968) first introduced a simple and appealing method for reduc-ing problems with variable rates of time preference to single-state systems by transforming the time scale from t to A, a utility discount factor. This transformation has been used extensively, particularly ...
Journal of International Money and Finance
We identify global and regional fluctuations in international private debt flows to emerging and ... more We identify global and regional fluctuations in international private debt flows to emerging and developing countries using data on cross-border loans and international bond issuance over 1993–2009. We use micro-level data on syndicated cross-border loans and international bond placements to estimate the effects of individual borrower characteristics as well as macroeconomic conditions on the cost of foreign borrowing and test whether these effects differ across phases of the lending cycle. First, we find that borrower characteristics associated with lower loan spreads are not necessarily associated with lower bond spreads. Second, we find differential effects of borrower characteristics between cycle phases for loans and bonds separately. Third, we find strong reductions in the cost of debt finance during periods when international debt flows are more than one standard deviation above their mean, but not for expansionary periods, when the growth rate of debt flows is increasing. We...
Journal of Macroeconomics, 2009
The wealth distribution in the U.S. is more unequal, or skewed to the right, than either the inco... more The wealth distribution in the U.S. is more unequal, or skewed to the right, than either the income or earnings distribution, a fact current models of saving behavior have difficulty explaining. Using Max Weber's (1905) idea that individuals may have a 'capitalist spirit', I construct and simulate a model where some individuals accumulate wealth for its own sake rather than as deferred consumption. Including capitalist-spirit preferences in the standard life cycle model, with no other modifications, generates a skewness of wealth consistent with that observed in the U.S. economy. Furthermore, capitalist-spirit preferences provide a way to generate decreasing risk aversion with increases in wealth without resorting to idiosyncratic rates of time preference.
Journal of International Money and Finance, 2014
This Working Paper should not be reported as representing the views of the IMF. The views express... more This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate. We identify global and regional fluctuations in international private debt flows to emerging and developing countries using data on cross border loans and international bond issuance over 1993-2009. We estimate the effects of individual borrower characteristics as well as macroeconomic conditions on the cost of foreign borrowing and test whether these effects differ across phases of the lending cycle. We find that public and financial institutions benefit from lower spreads compared to private and nonfinancial firms and that lenders may differentiate the risk associated with the borrower's industrial sector between good and bad times. The loan (bond) rating has an equally robust spread reduction effect across credit cycle phases. The results also suggest that international reserve holdings and investment ratios have a significant effect on reducing credit spreads for loans, while higher reserve holdings and longer maturities matter more for bond spreads.
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Papers by Johanna Francis