There is growing attention to analyse the influence of gender upon women’s entrepreneurship. Nonetheless, the body of literature almost entirely concentrates on developed nations, specifically on the USA and Europe. The research context for the thesis is Bangladesh, a South Asian developing nation, where there was a government initiative to support small businesses of women through bank loans. Recognising that entrepreneurship is a social phenomenon, it is important to explore how gender subordination is articulated in the experiences of women business-owners in developing countries. Placing women at the centre of the study, this feminist standpoint research undertook interviews with 21 Bangladeshi women business-owners. Considering finance as a major area of entrepreneurship, this thesis analyses the influence of gender upon women business-owners’ access to debt finance in the context of a patriarchal developing nation. To address this aim, the study investigates the family as well as the broader societal context. The thesis contributes to advance the understanding of gender subordination of women business-owners within the context of debt financing from developed nations to developing nations. The extant literature on debt finance of developed nations focuses almost solely on discrimination-related issues. It is individual woman business-owner centric, ignoring the family or the broader societal context. Nevertheless, the empirical evidence of this study suggests that male family members were inevitably involved in the process. Further, in developed nations, the exploration of patriarchal practices is primarily limited to the adverse effect of societal expectation of work (i.e., domestic responsibilities and childcare) on the businesses of women. This study extends the view by demonstrating that the dominating, oppressing and exploiting roles of male family members were evident at the individual level with a direct influence on the business activities. The husbands of many women were even found to share the bank loans entirely or partially. This has implications for the effectiveness of the government policy, aiming at the emancipation of the women. Moreover, the study significantly adds to the prevailing knowledge by identifying certain context specific family related issues (for instance, child marriage) or the structural, cultural issues of the broader society (such as, corruption) in relation to gender subordination of women business-owners. While explaining gender subordination of women business-owners, the contribution of the thesis is not limited to its understanding in a developing nation. Given the highly patriarchal nature of the context, the study provides opportunity to extend the comprehension of some of the issues of gender subordination (for instance, the respectable position of women) that are existing in developed nations in a more subtle form. Thus, it provides a platform for future research in the field of entrepreneurship, gender and finance in developing nations as well as in developed nations.

In 1965 the New Order Government took office in Indonesia, following years of severe economic turmoil. Since then the Indonesian economy has performed well, owing much to large oil export revenues and appropriate economic policies. This thesis presents a study of the Indonesian economy focused on three main themes: aid, the public sector and the real exchange rate (RER). In particular, we emphasise aid effectiveness on fiscal behaviour and on the RER. The thesis is organised in five chapters. Chapter 1 presents a synthetic overview of the main episodes in Indonesian economic history. Chapter 2 reviews theoretical and empirical issues on aid. Chapter 3 presents a dynamic model of government behaviour aimed at assessing aid’s impact on fiscal budget and on other real variables in the Indonesian economy. Following Heller’s seminal contribution (1975) and White’s new insights (1993), we insert the government sector into a simple macroeconomic framework: a constrained utility maximising framework which allows for feedback effects through higher income and dynamic linkages. The model is tested for the Indonesian case over the period 1968-93 and the estimated parameters are used to carry out a simulation exercise. We conclude with a positive assessment of aid giving, provided it is given in loans. Loans are found to encourage tax collection, public and private investment and consumption. Exchange rate management has played a significant role in Indonesia as an instrument to ensure competitiveness during and after the oil boom. Chapter 4 analyses the behaviour of the RER for the Indonesian rupiah and offers a theoretical and statistical background. Unit root testing has been extensively used to test for stationarity. We have consistently rejected the hypothesis of RER stationarity, except in those cases in which the full sample series have been used and/or two breaks have been allowed. Chapter 5 presents a modelling approach to RER determination. Following Edwards (1989), we present an econometric model of the RER and develop an extension of it in terms of the Error Correction Mechanism (ECM). Central to the analysis is the role of fundamentals, in particular aid and the price of oil, in determining the RER. The estimated parameters are then used to construct the equilibrium RER in order to study RER misalignment. Simulations are also carried out to investigate the impact of exogenous shocks and policy options on the RER. Results show that the Indonesian RER suffered from misalignment especially during the oil boom and until the early 1990’s. We also find that aid and the real price of oil do matter: both act as fundamental determinants of RER behaviour and contribute to RER stability, a finding confirmed by the simulation exercise. Interestingly, aid and government consumption appear to influence in differences and not in levels the RER.

This Thesis examines the determinants of corporate capital structure during a period characterised by significant changes in the overall economic conditions. Empirical studies of capital structure generally concentrate on identifying the firm-specific factors that managers should consider in making capital structure decisions, while ignoring the possible implications of the overall economic conditions that could affect the firms’ financing decisions. Given that the 2007 Global Financial Crisis (GFC) was accompanied by an economic recession, this provides a unique opportunity to investigate the impact of the overall economic conditions on firm’s capital structure. There have been a number of unique factors to the 2007 GFC and the following economic recession that are not observed in previous economic downturns in the UK. These include near-zero interest rate (which was reduced by the Bank of England from a pre-crisis peak of 5.75% in July 2007 to 0.5% in March 2009), the extraordinary level of support to the troubled firms offered by the government (e.g., the Business Payment Support Service; the Asset Protection Scheme; and the Funding for Lending Scheme), and the unprecedented banks’ forbearances on non-performing loans (e.g., granting waivers to breaches of pre-agreed loan covenants; switching to an interest-only loans; offering payment holidays; and rolling over the loan). These factors while protecting many viable businesses, may have contributed to the survival of some technically insolvent firms that would have defaulted otherwise. Recent evidence from insolvency practitioners have suggested the emergence of such “zombie” firms in the UK over the course of the GFC and the following economic recession. Accordingly, the objective of this Thesis is fourfold. The main objective is to investigate the impact of the recent GFC and the firm-specific determinants of the capital structure on firms’ leverage ratios. The second objective is to identify zombies, thirdly to develop an empirical model to identify the determinants of zombieness status, and fourthly to estimate their impact on the probability of becoming a zombie. The same dataset on the constituents of the FTSE 250 Index is utilised in achieving all these objectives. Identifying zombies via a two-condition criteria, and using a population-averaged logit procedure, we show that the probability of becoming a zombie increases with the degree of financial leverage and viability of the business (as perceived by firm’s top management). However, it is negatively affected by firm’s profitability, cash-generating ability, and the ability to pay dividends. Our results thus show that there was a prevalence of zombie firms in the UK which evolved from the GFC. Using data on the constituents of the FTSE 250 Index over the period 2004-2012 and estimating a two-step System GMM procedure, we find that the leverage ratio is positively affected by the tangibility of assets, the size of the firm, the amount of non-debt tax shields, growth opportunities and business risk, but declines with an increase in firm profitability. Furthermore, the recent GFC is found to exert a significant impact on firms’ leverage ratio. The results also confirm that firms have target leverage ratios with a fairly fast speed of adjustment. Applying the same estimation technique to a post-crisis model, we find that, despite the substantial differences in their ability to meet financial obligation, the leverage ratios of zombies and non-zombies do not seem to be determined differently. We further establish that except for business risk and growth opportunities, other commonly used firms-specific determinants of capital structure, maintain their empirical relevance over the post-crisis period.

This thesis reviews the literature, simulates and applies the Gravity Model of International Trade. The gravity model is widely used in international trade to examine trade flows within a network of exporters and importers. It describes the push and pull factors of trade flows and is fast becoming the most favoured tool when estimating the welfare effects of a trade policy. Therefore, estimating an accurate baseline equation is critical to correctly identify the welfare effects of trade and accompanying trade policies. Recent developments in the literature on the gravity model have helped in this regard. Chapter 1 presents a summary. The literature identifies several estimation issues and prescribes several actions that could be taken to best estimate the gravity model and minimize potential bias in the coefficient(s) of interest. With the objective of minimizing the bias on the coefficient(s) of interest, this thesis, in Chapter 2, builds on the literature by simulating and estimating the gravity model using varying assumptions about the data generating process (dgp) of the errors, conditional mean and sample. The findings from these simulations are then used to guide the application (Chapter 3) of the gravity model to trade among Caribbean Community (CARICOM) members and trade between CARICOM members and the rest of the world (ROW). Subsequently, in Chapter 4, the gravity model is used as the basis for a general equilibrium framework to investigate the importance of international borders, regional trade agreements (RTAs) and the potential impact of deeper integration in the form of a currency union among CARICOM members. The welfare implications for CARICOM members, associated with being a member of the RTA and adapting a common currency, are presented in Chapter 4 along with several recommended trade policies and areas for future research.

The first chapter provides an overview of the topics covered in this thesis. The second chapter explores the effect of historic gender division of labour during slavery on African American women’s performance in the labour market. Using census data from 1870 to 2010, I show that African American women living in areas with lower levels of gender division of labour were more likely to participate in the labour market and have higher occupation income scores after emancipation. The effects are persistent for at least 70 years after the end of slavery. I analyse the mechanisms driving the results, distinguishing between labour supply and demand channels, and I explore intergenerational transmission of gender roles. The third chapter empirically assesses the importance of ethnic networks in facilitating international trade. In particular, it investigates the impact of ethnic Cantonese networks in the United States on the export performance of firms based in Southern China. The results indicate that exposure to ethnic networks has a positive effect on exports, both at the extensive and the intensive margin. We explore the mechanisms underlying the results, distinguishing between information flows, contract enforcement, foreign investment and technology diffusion. The fourth chapter analyses the effect of ethnic Chinese networks in the United States on knowledge diffusion and innovation in China. I construct a proxy for the ethnic network based on historic Chinese settlements and current industry employment patterns, exploiting the migration restrictions imposed by the Chinese Exclusion Act of 1882. The results indicate that when innovation in the U.S. increases, industries that are more exposed to the ethnic network in the U.S. innovate more in China. This suggests that ethnic networks contribute to the diffusion of technology across countries.

From its inception, behavioural economics’ mission has been to bring deeper psychological insights into economics. Relying mostly on experimental data, this field became notorious for providing evidence of the shortcomings of standard economic models in predicting human behaviour. These findings motivated a first generation of behavioural models, which tried to systematise this departure from standard economics. However, these initial attempts were widely criticised for their methods (these models were argued to lack the tractability, systematic approach and level of generality desired by economic science) and for their lack of relevance for economic phenomena (markets, evolution and arbitrage would drive away behavioural biases). This criticism motivated a second wave of behavioural models, which augmented neo-classical frameworks with psychologically realistic behavioural assumptions. This approach allowed this field to establish a link to previous results of economics and address criticisms about the relevance of behavioural findings in markets. A further step in the direction of linking behavioural models and standard theory is to introduce learning to behavioural models. While this concept has been largely absent from behavioural economics’ analysis of markets for technical reasons, its presence is necessary for two reasons. First, learning is commonly used to dismiss (behaviourally motivated) consumer mistakes, so it is crucial to study whether existing results of this literature will be robust to this variation. Second, in a world which is constantly evolving, learning in itself is an important driver of economic phenomena and, hence, should not be dismissed by this field. In this thesis, I augment previous behavioural models by studying their existence in environments with consumer learning. By extending static behavioural problems to dynamic environments with learning, I am able to explain puzzles in the areas of technology adoption and contract theory. In chapter 1, I propose that status considerations – a feature of consumers’ preferences overlooked by classical theory – can have positive effects in society whenever they are considered in an environment with active learning (i.e., experimentation). In chapter 2 and 3, I show that when naıve of behavioural consumers (who lack self-awareness about their preferences) can learn, pricing methods in subscription contracts, which were previously unexplained by standard contract theory, can be shown to be the optimal response of firms trying to prevent consumer learning.

This dissertation studies the economic history of South Africa’s industrial decentralisation policies, which led to greater trade and foreign investment with Taiwan during the closing phases of apartheid. These large industrial schemes sought to increase exports of finished goods, diversify manufacturing from urban centres, and develop the African homelands, while continuing the status quo of racial segregation. In examining (1) bilateral trade, (2) foreign investment and (3) business network agglomeration, I illustrate the role Taiwanese firms played in fulfilling important aims of the industrial decentralisation policy. The three interrelated topics explain how the diplomatic relationship developed, the effects to bilateral trade, and why Taiwanese investors came to be the largest group of industrialists in the apartheid-era homelands. However, the research agenda presented in this thesis is not merely a narrow analysis of trade and investment. It also provides a broader perspective of key questions in South Africa’s economic history: specifically, the rise and fall of apartheid, the contradictory forces of regional industrial decentralisation, which shaped Africa’s most industrialised economy, and the roots of persistent inequality stemming from the homeland system. The period between 1975 and 1994 was turbulent with both countries facing different degrees of political and economic isolation. Prior scholarship has focused on the diplomatic relationship between the two countries, as international sanctions made quantitative data difficult to access. The introduction of new qualitative and quantitive data on the apartheid economy highlights the economic motives for this large wave of Asian foreign investment, especially those in the rural African homelands. Moreover, it draws lessons from the historical patterns of apartheid industrial and spatial development, which are analogous to current African special economic zone policies.

This thesis argues that the British Industrial Revolution, which marked the beginning of sustained modern economic growth, was facilitated by the blossoming in eighteenth and early nineteenth century Britain of the world’s first infrastructure for commercial R&D, composed of a network of ‘Knowledge Access Institutions’ (KAIs): scientific societies, ‘mechanics institutes’, public libraries, masonic lodges and other organisations. This infrastructure lowered the cost of access to knowledge for scientists, inventors and entrepreneurs, raising the productivity of R&D and encouraging a sustained increase in R&D effort. This contributed to the acceleration in technological innovation that lay behind the transition to modern economic growth. First, I define the concept of KAIs and explain how they affected the rate of economic growth. Second, I present detailed data on the KAI infrastructure and estimate its effect on the rate of technological innovation during the British Industrial Revolution, using newly constructed spatial datasets on British patents between 1700 and 1852 and exhibits at the Great Exhibition of 1851. Third, I argue that KAIs were largely exogenous to industrialisation, rooted instead in the intellectual developments of the Scientific Revolution and European Enlightenment. Fourth, I show that the prevalence of Knowledge Access Institutions was correlated with the emergence of modern economic growth across countries in the late nineteenth century and that the cost of access to knowledge was a binding constraint to economic progress shared by many countries during this period. Finally, based on the case of late nineteenth century US manufacturing, I investigate the extent to which the emergence of modern economic growth depended on the incentives to innovate rather than the capabilities lent by access to knowledge and other factors. The thesis suggests that the sharp fall in the cost of access to knowledge that we are currently experiencing may give rise to an acceleration in the rate of technological innovation in the coming decades and that policymakers should direct some effort towards mitigating the potentially harmful effects of rapid technological change.

The thesis consists of three independent chapters on environmental and urban economics. A central theme explored in this thesis is what determines the distribution of economic activities across space. My exploration in this direction begins with the roles of industrial pollution and transportation infrastructure in shaping the spatial distribution of skills, and extends to evaluate the spatial allocation efficiency of renewable energy projects. The first chapter,“The Long Shadow of Industrial Pollution: Environmental Amenities and the Distribution of Skills”, investigates the role of industrial pollution in determining the competitiveness of post-industrial cities, with a focus on their ability to attract skilled workers and shift to a modern service economy. I assemble a rich database at a fine spatial resolution, which allows me to track pollution from the 1970s to the present and to examine its impacts on a whole range of outcomes related to productivity and amenity, including house prices, employment, wages, and crime. I find that census tracts downwind of highly polluted 1970s industrial sites are associated with lower housing prices and a smaller share of skilled employment three decades later, a pattern which became evermore prominent between 1980 and 2000. These findings indicate that pollution in the 1970s affected the ability of parts of cities to attract skills, which in turn drove the process of agglomeration based on modern services. To quantify the contribution of different mechanisms, I build and estimate a multi-sector spatial equilibrium framework that introduces heterogeneity in local productivity and workers’ valuation of local amenities across sectors and allows the initial sorting to be magnified by production and residential externalities. Structural estimation suggests that historical pollution is associated with lower current productivity and amenity; the magnitudes are higher for productivity, more skilled sectors and central tracts. I then use the framework to evaluate the impact of counterfactual pollution cuts in different parts of cities on nationwide welfare and cross-city skill distribution. The second chapter, “Travel Costs and Urban Specialization: Evidence from China’s High Speed Railway” examines how improvements in passenger transportation affect the spatial distribution of skills, exploiting the expansion of high speed railway (HSR) project in China. This natural experiment is unique because as a passenger-dedicated transportation device that aims at improving the speed and convenience of intercity travel, HSR mostly affects urban specialization through encouraging more frequent intercity trips and face-to-face interactions. I find that an HSR connection increases city-wide passenger flows by 10% and employment by 7%. To further deal with the issues of endogenous railway placement and simultaneous public investments accompanying HSR connections, I examine the impact of a city’s market access changes purely driven by the HSR connection of other cities. The estimates suggest that HSR-induced expansion in market access increases urban employment with an elasticity between 2 and 2.5. The differential impacts of HSR on employment across sectors suggest that industries benefiting more from enhanced market access are the ones intensive in nonroutine cognitive skills, such as finance, IT and business services. These findings highlight the role of improved passenger travel infrastructure in promoting the delivery of services, facilitating labour sourcing and knowledge exchange across cities, and ultimately shifting the specialization pattern of connected cities towards skilled and communication intensive sectors. In the last chapter, “Where does the Wind Blow? Green Preferences and Spatial Misallocation in the Renewable Energy Sector” , I focus on the spatial allocation efficiency of renewable energy projects. How efficiently are renewable energy projects distributed across the US? Are “greener” investors worse at picking sites? Using extensive information on wind resources, transmission, electricity prices and other restrictions that are relevant to the siting choices of wind farms, I calculate the predicted profitability of wind power projects for all possible locations across the contiguous US, use this distribution of this profitability as a counterfactual for profit-maximizing wind power investments and compare it to the actual placement of wind farms. The average predicted profit of wind projects would have risen by 47.1% had the 1770 current projects in the continental US been moved to the best 1770 sites. I also show that 80% and 42% respectively of this observed deviation can be accounted for by within-state and within-county distortions. I provide further evidence that a large proportion of the observed within-state spatial misallocation is related to green investors’ tendency of invest locally and sub-optimally. Wind farms in more environmentally-friendly counties are more likely to be financed by local and non-profit investors, are closer to cities, are much less responsive to local fundamentals and have worse performance ex-post. The implementation of state policies such as Renewable Portfolio Standard (RPS) and price-based subsidies are related to better within-state locational choices through attracting more for-profit investments to the “brown" counties, while lump-sum subsidies have the opposite or no effects. My findings have salient implications for environmental and energy policy. Policy makers should take account of the non-monetary incentives of renewable investors when determining the allocative efficiency of policies.

This study, aiming to explain the synchronisation of the national trade cycles in pre-WWI years, begins with a review of trade cycle theories. The pattern of international trade cycles in 1870-1914 are then examined and their structures discussed: the US and German home investment and British overseas lending are found to form major initial cyclical shocks. The short term fluctuations in the US and German domestic capital formation in pre-1914 period are shown to be closely related to technological development such as railways and electricity; the shifts in both the push of British home investment and savings conditions and the pull of capital importing regions are held responsible for the cyclical variations in British foreign investment. Cyclical patterns identified in money stocks of various countries are argued to result mainly from procyclical shifts in demand for money. Focusing then our attention upon the course of one international trade cycle in 1885-1896 in the US, Germany, Britain and Argentina, we find that the international upswing in the latter half of the 1880s was initiated by the start of railway building boom in the US as a consequence of the improvement in railway profitability due to agricultural development around the railways built during the previous boom in western states such as Kansas and Nebraska; the termination of largely British-financed Argentine railway construction boom due to overbuilding played an important role in triggering the world-wide depression in the early 1890s. These initial disturbances seemed to be diffused throughout the world mainly via trade and psychological channels. In contrast, it is demonstrated that international gold flows were not translated into significant monetary shocks, since banking systems were able to vary in a flexible manner supply of deposits according to demand; nor did financial crises, tending to break out after the downturn in the level of activity, seem to constitute major channels of transmission of cyclical shocks. As to the relevance of various types of trade cycle theories to the explanation of the cyclical experiences in the ten-odd years concerned, it is therefore concluded that the fluctuations in cyclical origins, e.g. US and Argentina, can largely be understood in the context of Schumpeterian theory of innovation; that although the shifts in expectations were not so purely autonomous as Keynes thought, they played important parts in the transmission of cyclical shocks from the origins to Germany and Britain; that Hicksian full employment ceiling did not seem to develop in any of the four countries, which was probably to a great extent due to relatively free international trade and factor mobility; that weak multiplier- accelerator model kept alive by random shocks captures essential aspects of the pre-1914 British trade cycles; finally that monetary disturbances, such as gold flows and financial crises, did not appear important in either creating or transmitting cyclical forces.