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on Macroeconomics |
| By: | Isabel Gödl-Hanisch; Ron Mau; Jonathan Rawls |
| Abstract: | We study monetary policy in a New Keynesian model with a variable credit spread and scope for central bank asset purchases to matter. A novel financial and labor market interaction generates an endogenous cost-push channel in the Phillips curve and a credit wedge in the IS curve. These channels arise due to a liquidity premium to long-term debt present in our model. The “divine coincidence” holds with the nominal short rate and central bank balance sheet available as policy tools—dual-instrument policy. Targeting the liquidity premium using balance sheet policy provides a determinate equilibrium with a fixed policy rate, as does inflation-targeting balance sheet policy. While the liquidity premium in our model depends on unobservable components, the slope of the yield curve serves as a proxy for the liquidity premium when thinking about implementable monetary policy strategies that respond to observable variables alone. We quantify the welfare costs to various monetary policy strategies relative to the analytically derived optimal dual-instrument policy. |
| Keywords: | unconventional monetary policy; optimal monetary policy; New Keynesian model; policy rate; Interest rate |
| JEL: | E43 E52 E58 |
| Date: | 2024–11–09 |
| URL: | https://d.repec.org/n?u=RePEc:fip:feddwp:99106 |
| By: | Michael J. Lamla; Damjan Pfajfar; Lea Rendell |
| Abstract: | We explore the consequences of losing confidence in the price stability objective of central banks by studying the resulting inflation and deflationary biases in medium-run inflation expectations. In a model with heterogeneous household perceptions of an occasionally binding zero-lower-bound constraint and of monetary policy objectives, we show that the estimated model-implied distribution of households' inflation expectations matches several characteristics of the empirical distribution when featuring both inflation and deflationary biases. We then directly identify these biases using unique individual-level survey data on medium-run inflation expectations across nine countries and over time. Both inflation and deflationary biases are important features of the distribution of medium-run inflation expectations. |
| Keywords: | inflation bias; deflationary bias; confidence in central banks; effective lower bound; inflation expectations; microdata |
| JEL: | E31 E37 E58 D84 |
| Date: | 2024–11–21 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedcwq:99150 |
| By: | Jamie L. Cross; Aubrey Poon; Wenying Yao; Dan Zhu |
| Abstract: | The Dynamic Nelson-Siegel (DNS) model implies that the instantaneous bond yield is a linear combination of yield curve’s level and slope factors. However, this constraint is not used in practice because it induces a singularity in the state covariance matrix. We show that this problem can be resolved using Bayesian methods. The key idea is to view the state equation as a prior distribution over missing data to obtain a hyperplane truncated multivariate normal conditional posterior distribution for the latent factors. This distribution can then be reparameterized as a conditional multivariate normal distribution given the constraint. Samples from this distribution can be obtained in a direct and computationally efficient manner, thus bypassing the Kalman filter recursions. The empirical significance of the resulting Yield-Macro Constrained DNS (YM-CDNS) model is demonstrated through both a reduced form analysis of the US Treasury yield curve, and a structural analysis of functional conventional and unconventional monetary policy shocks on the yield curve and the broader macroeconomy. |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:bny:wpaper:0133 |
| By: | Janet Hua Jiang; Rupal Kamdar; Kelin Lu; Daniela Puzzello |
| Abstract: | We disentangle the channels through which inflation expectations affect household spending. We conduct a survey featuring hypothetical scenarios that generate a controlled increase in inflation expectations. For 74% of households, current spending is unresponsive, typically due to fixed budget plans or irrelevance of inflation expectations. About 20% of households reduce spending, often citing wealth effects, nominal income rigidity, and inflation hedging. Only 6% increase spending, mostly due to intertemporal substitution or stockpiling. Respondents who expect other economic variables to deteriorate are more likely to reduce spending. Our findings suggest manipulating inflation expectations to boost consumer spending may not be an effective policy tool. |
| Keywords: | Central bank research; Inflation and prices; Inflation targets; Monetary policy; Monetary policy transmission |
| JEL: | D15 D84 E2 E52 E7 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:bca:bocawp:24-44 |
| By: | Burgelman, Robert A. (Stanford U); Chanda, Sasanka Sekhar (IIM Indore) |
| Abstract: | Re-examining field research findings about three critical episodes in Intel Corporation’s evolution we find that when autonomous strategic behavior significantly increased relevant organizational knowledge Intel top management provided sustained support; when it did not, top management support stopped. Deploying an extended version of March’s (1991) computational model of organizational learning we find that, in stable and in moderately turbulent environments top management is likely to provide sustained support to autonomous strategic behavior only when it augments organizational knowledge that is significantly different from organizational learning already embodied in the firm’s current corporate strategy. Top management support depends on detecting such change in organizational learning by increasing the rate of exploitation. |
| Date: | 2024–03 |
| URL: | https://d.repec.org/n?u=RePEc:ecl:stabus:4176 |
| By: | Alexa Orton; Tim Gebbie |
| Abstract: | We consider financial market regime detection from the perspective of deep representation learning of the causal information geometry underpinning traded asset systems using a hierarchical correlation structure to characterise market evolution. We assess the robustness of three toy models: SPDNet, SPD-NetBN and U-SPDNet whose architectures respect the underlying Riemannian manifold of input block hierarchical SPD correlation matrices. Market phase detection for each model is carried out using three data configurations: randomised JSE Top 60 data, synthetically-generated block hierarchical SPD matrices and block-resampled chronology-preserving JSE Top 60 data. We show that using a singular performance metric is misleading in our financial market investment use cases where deep learning models overfit in learning spatio-temporal correlation dynamics. |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2410.22346 |
| By: | Renda, Andrea; Del Giovane, Chiara; Iacob, Nadina; Nguyen, Hieu |
| Abstract: | The creation of the Health Emergency Preparedness and Response Authority (HERA) was one of the EU’s key institutional reforms triggered by the Covid-19 pandemic. Having been operational in 2022, HERA is expected to contribute to Europe’s resilience against future health emergencies and other risks. The making of HERA and its first months of operations have been subject to a very lively debate. Initial rumours had it that it would be established as an independent agency; however, eventually the European Commission announced that it would create HERA as an internal department. Some stakeholders argued that this would undermine the transparency and accountability of HERA, its pursuit of health as a public good, its budgetary autonomy and its ability to represent the EU in international forums. Against this backdrop, the report outlines the main challenges faced by EU institutions in their response to Covid-19, the opportunity cost of not remedying existing problems in the near future and the role of HERA in the EU’s evolving multi-level governance in the health domain including the European Health Union and the emerging EU Global Health Strategy. The report does not take a pre-determined stance on the independence of HERA: rather, it shows that there are pros and cons of setting up HERA as an internal department rather than an independent authority, and discusses ways to mitigate the risks associated with the current setup. Furthermore, it identifies six main domains in which HERA can be improved going forward: its mission, governance, operational capacity, budget, management of intellectual property rights and prospective role in global health-security governance. Research on these six areas, and two lively workshops organised with a diverse group of stakeholders, led to identifying 27 recommendations. The latter cover both short- and medium-term actions that could ensure that HERA, in its current governance configuration, can deliver on the ambitious mandate it was given at the inception of its operations. |
| Date: | 2023–01 |
| URL: | https://d.repec.org/n?u=RePEc:eps:cepswp:38637 |
| By: | Cristhian D. Prieto; Ilan Noy |
| Abstract: | Floods are among the most frequent and destructive natural hazards worldwide, yet their economic impacts remain poorly understood. This paper examines the effects of two cyclone-induced floods on firms’ economic performance in New Zealand. To identify flood damage, we propose a novel method using high-resolution satellite imagery to track changes in ground vegetation before and after the cyclones. By integrating this information with detailed business administrative records and enterprise survey data, we construct a unique plant-level dataset to estimate the flooding causal effects. Using a Difference-in-Differences (DID) approach, we find that firm premises located in flood-affected areas experienced significant declines in gross output and sales, alongside increased losses in profit and value-added. Contrary to common belief, our analysis reveals that capital damage and labour displacement, rather than productivity losses, are the primary channels through which flooding affects firms. Plants responded to these events by liquidating inventories and cashable assets, though no evidence of relocation is found. Our results are robust to various econometric specifications and alternative estimation methods, including the Synthetic Difference-in-Differences (SDID) estimator. |
| Keywords: | floods, firms, production, cyclones, coping strategies, labour, capital, productivity, DID, SDID |
| JEL: | D24 J20 L11 O13 O14 Q54 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11430 |
| By: | Jelena Momcilovic and Mirjana Miletic; Jelena Momcilovic (National Bank of Serbia); Mirjana Miletic (National Bank of Serbia) |
| Abstract: | In this paper we showed how labour market factors are included in the macroeconomic model which the National Bank of Serbia uses for the medium-term inflation projection, thus enabling an insight into labour market trends, as well as an analysis of the link with other macroeconomic indicators, notably their effect on inflation. The estimates obtained by applying the Kalman filter indicate that NAIRU is still below the unemployment rate, suggesting a positive unemployment gap and showing that the labour market in Serbia is not exerting any major pressures on inflation. The paper also presents the results of testing the relevance of the hysteresis effect in the unemployment rate for Serbia. The hysteresis effect was confirmed by applying the unit root test and estimating the statistical significance of the stochastic trend in the NAIRU series. |
| Keywords: | labour market, inflation, NAIRU, monetary policy |
| JEL: | F30 G15 G20 G30 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:nsb:bilten:25 |
| By: | Danzer, Alexander M. (Catholic University of Eichstätt-Ingolstadt); Zeidler, Helen (Technical University of Munich) |
| Abstract: | This paper investigates time inconsistencies in food consumption based on a field experiment at a college canteen where participants repeatedly select and consume lunch menus. The design features a convex non-monetary budget in a natural environment and satisfies the consume-on-receipt assumption. Leveraging 3, 666 choices of different food healthiness, we find no time inconsistency at the meal level. Utility weight estimates at the dish level reveal that consumers balance healthiness between food categories. Individuals who exert self-control take up a commitment device as soon as available, while non-committers are present-biased. Dynamic inconsistencies in food and money choices are independent. |
| Keywords: | field experiment, dynamic inconsistency, commitment, food consumption |
| JEL: | D12 D01 C93 D91 I12 |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17415 |
| By: | Lottie Field |
| Abstract: | This paper produces the first cross-country comparable, scalable method of categorising organisations as political or bureaucratic. I use this method to construct new data on the politicisation of organisations designing industrial policy in 116 countries. Thus, this paper produces the first systematic global analysis of the politicisation of industrial development organisations. I produce the following four stylised facts. First, industrial policymaking is predominantly political. Over 60% of the industrial policy organisations in my data are run by politicians. Second, lower-income countries use a higher proportion of political organisations to do their industrial policy. Third, there is great variation in the proportion of political organisations in each policy area. Politicians run 30% of Export Import and Central banks. Politicians run 60% of organisations focused on primary commodities. Fourth, the proportion of organisations run by bureaucrats is positively and statistically significantly correlated with several measures of bureaucratic quality. This relationship is robust to controlling for the number of industrial policy organisations and GDP per capita. |
| Date: | 2024–09–30 |
| URL: | https://d.repec.org/n?u=RePEc:oxf:wpaper:1055 |
| By: | Jia, Qifan; Zhou, Sizhe; Liu, Run; Zuo, Yihan; Pan, Cuiyu; Chen, Yu |
| Abstract: | Buying domestic products has become increasingly important in many countries. As a form of social influence, social norms affect people’s domestic purchasing intentions and behavior. The current study aims to examine the mechanisms by which social norms influence domestic purchasing intentions through the lens of consumer ethnocentrism and domestic product judgments. The data were collected through an online survey in China, and a total of 346 valid responses were obtained. The results indicate that social norms influence domestic purchasing intention through four paths, namely, direct path, motivational path, cognitive path, and motivational–cognitive path. Consumer ethnocentrism and domestic product judgments, serving as the motivational and cognitive factors, respectively, play mediating and serial mediating roles in the relationship between social norms and domestic purchasing intention. In addition, consumer ethnocentrism has two dimensions, namely, pro-domestic and anti-foreign consumer ethnocentrism, and only the former plays a significant role in the model. The current study has theoretical contributions to research on domestic purchasing intention and practical implications for interventions in domestic purchasing behavior. Future studies are encouraged to conduct experiments, distinguish between different types of social norms, measure purchasing behavior, and verify the relationships in other countries. |
| Keywords: | China; consumer ethnocentrism; domestic product judgments; domestic purchasing intention; social norms |
| JEL: | D12 Z13 |
| Date: | 2023–05–31 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:125881 |
| By: | Hunter Ng |
| Abstract: | This article investigates whether the Federal Reserve Chair strategically controls facial expressions during FOMC press conferences and how these nonverbal cues affect financial markets. I use facial recognition technology on videos of press conferences from April 2011 to December 2020 to quantify changes in the Chair's nonverbal signals. Results show that facial expressions serve as a separate public signal, distinct from verbal content. Using deepfakes, I find that the same facial expressions expressed by different Fed Chairs are interpreted differentially. As their tenure increases, negative expressions become more frequent, eliciting adverse market reactions. Furthermore, the markets interpretation of these expressions evolves over time, suggesting that investors process facial cues with dual-processing finite-state Markov memory. In line with the Fed's goals of transparency and non-volatility, I find that Fed Chairs do not strategically control their expressions. |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2410.20214 |
| By: | Hans Gersbach; Kremena Valkanova |
| Abstract: | This paper introduces Voting with Random Proposers (VRP) procedure to address the challenges of agenda manipulation in voting. In each round of VRP, a randomly selected proposer suggests an alternative that is voted on against the previous round's winner. In a framework with single-peaked preferences, we show that the VRP procedure guarantees that the Condorcet winner is implemented in a few rounds with truthful voting, and in just two rounds under sufficiently symmetric preference distributions or if status quo positions are not extreme. The results have applications for committee decisions, legislative decision-making, and the organization of citizens' assemblies and decentralized autonomous organizations. |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2410.20476 |
| By: | Asbjoern Juul Petersen (Department of Economics, University of Copenhagen) |
| Abstract: | investigate what affects foreign students’ decision to stay and work in the host country after completion of higher education. Specifically I ask whether the network of native peers at university affect the probability that foreign students in Denmark stay in the country and find employment after ended studies. To identify the causal effects, I exploit idiosyncratic variation in the share of Danish students who are admitted into each study program over adjacent cohorts. I find that an increase in the share of native peers of one standard deviation increases the probability that foreign students are employed in Denmark two years after ended studies by 4 pct. points. The effects are significant at least four years after ended studies. Improved professional network and knowledge of the Danish labor market seem to be an important mechanism. |
| Keywords: | Foreign students, labor supply, peer effects, higher education |
| JEL: | J22 I21 F66 |
| Date: | 2024–11–14 |
| URL: | https://d.repec.org/n?u=RePEc:kud:kucebi:2417 |
| By: | Shanker, Ankit; Vlaev, Ivo |
| Abstract: | Abstract This study examines the impact of social versus algorithmic corrections of vaccine misinformation on social media, on the perceptions of social norms around vaccination and vaccine intentions during a hypothetical pandemic. In an online experiment with 720 participants, we assessed whether user-generated or algorithmically generated corrections influenced perception of social norms measured as beliefs about other’s vaccination intentions (empirical expectations about vaccination), perception about the social appropriateness of vaccine refusal (normative expectations), and beliefs about others' perceptions of vaccine safety (second-order normative beliefs), and own vaccine intentions. User-generated corrections significantly increased the perceptions that refusing vaccination is socially very inappropriate and increased the perception that consensus is in support of vaccine safety. Algorithmic corrections did not influence social norm perceptions. Interestingly, neither social nor algorithmic corrections significantly altered empirical expectations about others' vaccination intentions. Both corrections also helped maintain participants' high initial vaccine intentions with algorithmic correction having stronger effects, in contrast to a significant decline in intentions observed in the control group exposed to misinformation without corrections. Algorithmic corrections from credible health agencies were effective in sustaining vaccine intentions, while user-generated corrections were more influential in improving perceptions of social norms. The study suggests that different correction types influence distinct determinants of vaccination behaviour: user-generated corrections reshape perceived social norms, while algorithmic corrections, citing credible sources, may better sustain high vaccine intentions. Keywords: Misinformation Corrections, Perceived Social Norms, Vaccine Intentions, Vaccine Misinformation, Social Corrections, Algorithmic Correction. |
| Date: | 2024–10–28 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:ahq26 |
| By: | Kentaro Hoshisashi; Carolyn E. Phelan; Paolo Barucca |
| Abstract: | Calibrating the time-dependent Implied Volatility Surface (IVS) using sparse market data is an essential challenge in computational finance, particularly for real-time applications. This task requires not only fitting market data but also satisfying a specified partial differential equation (PDE) and no-arbitrage conditions modelled by differential inequalities. This paper proposes a novel Physics-Informed Neural Networks (PINNs) approach called Whack-a-mole Online Learning (WamOL) to address this multi-objective optimisation problem. WamOL integrates self-adaptive and auto-balancing processes for each loss term, efficiently reweighting objective functions to ensure smooth surface fitting while adhering to PDE and no-arbitrage constraints and updating for intraday predictions. In our experiments, WamOL demonstrates superior performance in calibrating intraday IVS from uneven and sparse market data, effectively capturing the dynamic evolution of option prices and associated risk profiles. This approach offers an efficient solution for intraday IVS calibration, extending PINNs applications and providing a method for real-time financial modelling. |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2411.02375 |
| By: | Ivan Radanovic (National Bank of Serbia) |
| Abstract: | The goal of this paper is to analyse the concepts of open banking and open finance as data sharing models in banking and financial industry. A key idea behind these concepts is to enhance competition among payment service providers, ensure greater transparency of their work, expand the range of choices for consumers and, most of all, add value for the final consumer by improving the quality and reducing the price of services. In Europe, service providers from several European Union countries (Germany, the Netherlands, and Sweden – Sofortüberweisung, iDeal and Trustly) became the key drivers of data sharing models, prompting the European Union to regulate this new type of payment services in order to improve competition in the payment services market and ensure better consumer protection. The Payment Services Directive 2 (PSD2) 2015/2366 was thus adopted, requiring banks to allow access to customer information to all third-party providers such as payment institutions, e-money institutions, FinTech companies and other credit institutions, subject to customer’s consent. PSD2 recognises two new types of non-banking market participants – account information service providers (AISP) and payment initiation service providers (PISP). The paper combines the descriptive and comparative methods, as well as the case-study method, to give an outline of important data sharing regulations and models, and of the abovementioned payment service providers. The paper also looks into the experience of applying open banking and open finances in the United Kingdom and Brazil. The final section of the paper deals with institutional assumptions for developing the data sharing model in the Republic of Serbia. The current Law on Payment Services (RS Official Gazette, Nos 139/2014 and 44/2018) is largely harmonised with PSD2, as the original Payment Services Directive 2007/64 was fully transposed into the national legislation. Full harmonisation with PSD2 has been achieved through amendments to the Law on Payment Services (RS Official Gazette, No 64/2024) of 31 July 2024, which lay down measures to further enhance competition, innovation and the range of choices for the end-consumer. This Law will be applied as of 6 May 2025. Among other things, open banking will be introduced, as will the domestic equivalents to AISP and PISP participants. |
| Keywords: | data, open banking, open finance, payment initiation, account information, Law on Payment Services |
| JEL: | E42 G15 G21 G28 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:nsb:bilten:24 |
| By: | Ibrahima Mamikouny Sory Camara (LPAO-SF - Laboratoire de Physique de l'Atmosphère et de l'Océan Siméon Fongang - ESP - École Supérieure Polytechnique de Dakar - UCAD - Université Cheikh Anta Diop de Dakar [Sénégal]); Alpha Oumar Camara |
| Abstract: | Abstract This study, focusing on the professional downgrading of graduates in Guinea, examines the factors influencing this phenomenon through a quantitative approach. Conducted among graduates from 2016 to 2021 at the University of N'Zerekore, it relies on a stratified sampling technique to ensure representativeness of the different fields of study. Logistic regression analysis was used to assess the impact of several variables: gender, employment sector, salary, and residence. The results reveal that 65% of graduate employees feel that their skills exceed the requirements of their position. Graduates working in the informal sector or earning salaries below 550, 000 FG (around $60) were at higher risk of downgrading. In addition, graduates between 2016 and 2019, as well as those living in Upper Guinea, feel more downgraded. These observations are partly linked to the precariousness of jobs in the informal sector, where graduates find it hard to put their skills to good use. The length of time a graduate has held a job is also a determining factor, with older graduates showing themselves to be less at ease with recent changes in the job market. In addition, the study shows that 68.8% of downgraded graduates wish to leave their jobs, thus showing a high level of job dissatisfaction. This early resignation rate reflects a desire for mobility, often constrained by the mismatch between qualifications and jobs. The study recommends adapting educational programs to better match current labor market needs, and improving employment conditions, particularly in the informal sector. Adjusting wages in line with skills is crucial to reducing the perception of downgrading. Public policies must be put in place to promote a better match between qualifications and the jobs on offer. These measures would contribute to a better valuation of graduates and more successful professional integration. Keywords: Downgrading, graduates, Republic of Guinea, logit model, wages |
| Abstract: | Résumé Cette étude, axée sur le déclassement professionnel des diplômés en Guinée, examine les facteurs influençant ce phénomène à travers une approche quantitative. Menée parmi les titulaires de diplômes de 2016 à 2021 de l'Université de N'Zérékoré, elle s'appuie sur une technique d'échantillonnage stratifié pour assurer la représentativité des différents domaines d'études. Une analyse de régression logistique a permis d'évaluer l'impact de plusieurs variables : le sexe, le secteur d'emploi, le salaire et le lieu de résidence. Les résultats révèlent que 65 % des employés diplômés estiment que leurs compétences dépassent les exigences de leur poste. Les diplômés travaillant dans le secteur informel ou percevant des salaires inférieurs à 550 000 FG (environ 60 $[1]) présentent un risque plus élevé de déclassement. De plus, les diplômés entre 2016 et 2019, ainsi que ceux vivant en la haute-Guinée, se sentent davantage déclassés. Ces observations sont en partie liées à la précarité des emplois dans le secteur informel, où les diplômés peinent à valoriser leurs compétences. L'ancienneté du diplôme constitue un facteur déterminant, les diplômés plus anciens se montrant moins à l'aise avec les évolutions récentes du marché du travail. Par ailleurs, l'étude met en évidence que 68, 8 % des diplômés déclassés souhaitent quitter leur emploi, présente ainsi une forte insatisfaction professionnelle. Ce taux de départ anticipé traduit une volonté de mobilité, souvent contrainte, liée à l'inadéquation entre les qualifications et les emplois occupés. L'étude recommande d'adapter les programmes éducatifs pour qu'ils correspondent mieux aux besoins actuels du marché de l'emploi, et d'améliorer les conditions d'emploi, en particulier dans le secteur informel. L'ajustement des salaires en fonction des compétences s'avère crucial pour réduire la perception du déclassement. Les politiques publiques doivent être mises en place pour favoriser une meilleure adéquation entre les qualifications et les emplois offerts. Ces mesures contribuaient à une meilleure valorisation des diplômés et à une insertion professionnelle plus réussie. Mots clés : Déclassement professionnel, diplômé, République de Guinée, modèle logit, salaire. |
| Keywords: | Déclassement professionnel, diplômé, République de Guinée, modèle logit, salaire, African Scientific Journal, Downgrading graduates Republic of Guinea logit model wages, Downgrading, graduates, Republic of Guinea, logit model, wages |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04755157 |
| By: | Olivier Armantier; Marco Cipriani; Asani Sarkar |
| Abstract: | We study Discount Window (DW) stigma, the reluctance to access the Federal Reserve’s lender-of-last resort facility, between 2014 and 2024. Despite increased usage since 2020, we find conclusive evidence that the DW is stigmatized, especially among smaller banks and when financial markets experience disruptions. In particular, evidence of DW stigma emerged months before the 2023 banking turmoil and had not subsided a year later. We also identify new determinants and consequences of DW stigma. The implications of these results for the provision of emergency liquidity are discussed. |
| Keywords: | discount window; lender of last resort; stigma |
| JEL: | E52 G21 G28 |
| Date: | 2024–11–01 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fednsr:99159 |
| By: | Zhengyang Chi; Junbin Gao; Chao Wang |
| Abstract: | The interconnectedness of global financial markets has brought increasing attention to modeling volatility spillover effects. Via incorporating Graph Signal Processing techniques, a novel multivariate framework, extending the traditional Heterogeneous Auto-Regressive model, is developed in the spectral domain constructed by the graph Fourier transformation method. Further, a set of convolution filters with learnable weights is employed to more flexibly aggregate the past mid-term and long-term information. Using 24 global stock market indices, the effectiveness of the proposed model is demonstrated through comprehensive empirical evaluations. |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2410.22706 |
| By: | Richard W. Johnson; Karen E. Smith |
| Abstract: | This paper compares Social Security outcomes for non-Hispanic Black, Hispanic, and non-Hispanic white beneficiaries and assesses the capacity of various benefit enhancements to narrow racial and ethnic disparities in Social Security benefits. Using the Dynamic Simulation of Income Model 4 (DYNASIM4), we project, under current law and each benefit enhancement, lifetime Social Security benefits, the share of beneficiaries receiving limited annual benefits, and the share with limited annual income. To capture the fully phased-in impact of each option, we project annual outcomes in 2080 and lifetime outcomes for adults born between 2001 and 2010. |
| Date: | 2023–12 |
| URL: | https://d.repec.org/n?u=RePEc:crr:crrwps:wp2023-22 |
| By: | Pelkmans, Jacques |
| Abstract: | Last year’s celebration of 30 years of the single market never gave equal attention to the failures of the ‘not-so-single market’. Empowering the single market is badly needed due to its many shortcomings, its many barriers (more than often assumed), various taboos and lingering distortions. If empowered with a medium-term programme, led by the European Council and actively implemented by the Commission and the European Parliament, it could boost the EU economy by some 9 % of EU GDP, and possibly more if greater dynamism is generated via a stimulus of startups, higher R&D investment and a greater use of the new Unitary Patent. This CEPS In-Depth Analysis report comprises both institutional and substantive proposals. Regarding the former, the Council troika should play an active role as was the case during the early Delors period (late 1985 to 1988), the Commission should firm up enforcement and the EP’s Internal Market and Consumer Protection (IMCO) Committee should hold annual enforcement sessions that give citizens and business a voice. On substance, the programme has to be ambitious. Two parallel action programmes are proposed for services under the 2006 Services Directive, and services under dedicated sector regulation (such as rail freight, banking and larger, competitive capital markets, and stepping up investment in cross-border interconnectors). Cases of ‘hard fragmentation’ ought to be abolished, with the consolidation of the telecoms market, addressing ill-coordinated spectrum frequencies, finally implementing the SES 2+ air traffic control system, and the fully-fledged shift from national to EU copyright regulation. Other recommendations include the immediate abandonment of the Commission’s revised approach to harmonised European standards (an approach that serves no useful purpose), the need to avoid values-driven EU regulation on typical ‘diplomacy’ issues that has severe costs to companies heavily reliant on global value chains, and improvements in the conditions for EU startups, thus boosting dynamism in the single market. |
| Date: | 2024–01 |
| URL: | https://d.repec.org/n?u=RePEc:eps:cepswp:42064 |
| By: | Gerrit Bauch; Manuel Foerster |
| Abstract: | We conceptualize the communication of narratives as a cheap-talk game under model uncertainty. The sender has private information about the true data generating process of publicly observable data. The receiver is uncertain about how to interpret the data, but aware of the sender's incentives to strategically provide interpretations ("narratives") in her favor. We consider a general class of decision rules under ambiguity resolving the receiver's ignorance of the true data generating process, including maximum likelihood expected utility. The set of equilibria is characterized by a positive integer $N$: there is an equilibrium that induces $n$ different actions for each $1\leq n \leq N$. The diverting power of the sender is weaker than with a na\"ive receiver being unaware of the sender's incentives. Surprisingly, the receiver sometimes prefers to be na\"ive. |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2410.23259 |
| By: | Stephen O’Connell; Onur Altındağ; Rim Achour |
| Abstract: | We examine how allocating a fixed social assistance budget across localities using different prioritization rules affects both beneficiary selection and program effectiveness. By simulating each rule, we estimate program effects among marginal beneficiaries—those whose assistance varies across targeting strategies. The program reduces economic deprivation, with effect sizes ranging from 0.02 to 0.21 standard deviations. There are marked differences in the demographic backgrounds and economic constraints among marginal beneficiary populations, but program effects do not change substantially across targeting arms. We document sizable geographic variation in program effects, but limited ability to predict effectiveness using data typically available to implementers. |
| Keywords: | antipoverty programs, forced displacement, lebanon., poverty measurement, poverty targeting, refugees, social protection, unconditional cash transfers |
| JEL: | D74 I32 I38 O12 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:hic:wpaper:418 |
| By: | Labib, Krishma |
| Abstract: | Dominant initiatives focusing on research integrity are changing the research landscape by leading to the development and application of rules, guidelines and standards that researchers across borders have to abide by. There is an increasing attention within these initiatives on the importance of research fairness for conducting responsible research. However, some stakeholders view research fairness as separate, and sometimes even conflicting with, research integrity. To make sense of these accounts, in this paper, I explore the relationship between research integrity and research fairness. I argue that dominant research integrity initiatives are currently at odds with research fairness. This is because these initiatives largely ignore anticolonial views about research, and thereby perpetuate coloniality in research. Furthermore, dominant initiatives only engage superficially with aspects of fairness that are least controversial and current. Moreover, these research integrity initiatives impose Eurocentric ideals about responsible research to other countries, thereby contributing to ‘ethical imperialism’. Considering the wide reach of dominant research integrity initiatives and their influence on research, it is therefore urgent to develop an anticolonial research integrity agenda that takes fairness seriously. |
| Date: | 2024–11–01 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:ygakx |
| By: | Athey, Susan (Stanford U); Castillo, Juan Camilo (U of Pennsylvania); Chandar, Bharat (Stanford U) |
| Abstract: | The rise of marketplaces for goods and services has led to changes in the mechanisms used to ensure high quality. We analyze this phenomenon in the Uber market, where the system of pre-screening that prevailed in the taxi industry has been diminished in favor of (automated) quality measurement, reviews, and incentives. This shift allows greater flexibility in the workforce but its net effect on quality is unclear. Using telematics data as an objective quality outcome, we show that UberX drivers provide better quality than UberTaxi drivers, controlling for all observables of the ride. We then explore whether this difference is driven by incentives, nudges, and information. We show that riders’ preferences shape driving behavior. We also find that drivers respond to both user preferences and nudges, such as notifications when ratings fall below a threshold. Finally, we show that informing drivers about their past behavior increases quality, especially for low-performing drivers. |
| JEL: | D83 L91 O33 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:ecl:stabus:3894 |
| By: | Rosa Weber; Camilla Härtull; Jan Saarela |
| Abstract: | Although research in the STEM field has extensively examined its gendered characteristics, the vast majority of the literature has concentrated on educational transitions and young adults. More limited attention has been devoted to the longer-term work-family trajectories of STEM majors, and how these are linked to gender earnings gaps. In response, we exploit Finnish register data to identify the most common work-family trajectories followed by college educated men and women with STEM majors in ages 30–40 (N=150, 796). Given marked differences in gender proportions across STEM fields, we distinguish computer science and engineering majors from natural science majors. In a second step, we assess gender differences in the returns to distinct work-family trajectories and within-gender differences. We report three main findings. First, women are able to combine a career in computer science and engineering and having children. Second, across occupations, mothers earn considerably less than fathers. This suggests that even though women can combine work and family, they do not benefit in terms of earnings. Third, beyond uncovering gender gaps, we show that a major mechanism underlying parental gender gaps is that men receive notable fatherhood premiums across work trajectories. For women, findings reveal more heterogeneous patterns. Among computer science and engineering majors, women have similar earnings across trajectories. Conversely, women with natural science majors gain from working in computer science and engineering. |
| Keywords: | Computer science and engineering, Gender, Sequence analysis, Social stratification, STEM, Occupational life, Family life, Sex discrimination, Parenthood, Careers, Sex differentials, Life course, Finland, FINLANDE / FINLAND, VIE PROFESSIONNELLE / OCCUPATIONAL LIFE, VIE FAMILIALE / FAMILY LIFE, ENSEIGNEMENT SUPERIEUR / HIGHER EDUCATION, DISCRIMINATION ENTRE SEXES / SEX DISCRIMINATION, INFORMATIQUE / COMPUTER SCIENCE, SCIENCES NATURELLES / NATURAL SCIENCES, GENRE / GENDER, DIPLOME / DIPLOMAS, PARENTALITE / PARENTHOOD, CARRIERE / CAREERS, PARCOURS DE VIE / LIFE COURSE, DIFFERENCE ENTRE SEXES / SEX DIFFERENTIALS |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:idg:wpaper:3weaqjmbmewvndemrt6i |
| By: | Masaya Yasuoka (School of Economics, Kwansei Gakuin University) |
| Abstract: | This paper presents the findings from interviews conducted with individuals undergoing long-term care, detailing the realities of their daily lives and highlighting issues within various systems, including the current social security system. Although there are various reasons one might require long-term care, this study focuses on individuals affected by post-COVID-19 symptoms that persist after infection, adverse reactions from the COVID-19 vaccine, and adverse reactions from the HPV vaccine. The reason for examining these aftereffects together in one paper is that there are many commonalities in the daily life challenges, economic difficulties, and systemic issues that individuals face as a result of these conditions. This suggests the need for an integrated analysis of these aftereffects. |
| Keywords: | COVID-19 Vaccine Adverse Reactions, HPV Vaccine Adverse Reactions, Post-COVID-19 Symptoms |
| JEL: | I10 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:kgu:wpaper:281 |
| By: | Davila, Antonio (U of Lausanne); Foster, George (Stanford U); He, Xiaobin (Tsinghua U); Ning, Jia (Tsinghua U); Shimizu, Carlos (Stanford U) |
| Abstract: | We identify a model of early-stage company growth persistence. Using seven commercial high growth company lists (either a Top 500 or Top 100 list of companies), we find that approximately 30% of companies remain on these lists for two consecutive years. This 30% figure also approximates the likelihood of companies on the list in the first year after being ranked repeating for a subsequent second year. To probe potential explanations for the 30% consistency, we examine the Inc.5000 list that Inc. magazine has published since 2007. We find that many of companies have significant drops in their growth rates post the year in which they are included in the more demanding Inc.500 list — this is the classic mean reversion or what we call the “gravity effect.†Next, we examine how the measurement of growth affects the growth persistence reported in these commercial high-growth lists. We build our own database comprising over 100, 000 privately held companies from 11 different countries using ORBIS. We find that reported growth persistence, as defined by the transition probability, depends significantly on the choice of a growth measure. In particular, the use of longer periods to estimate growth and the use of average year-by-year growth (rather than difference between last and first years) increases the ability to identify companies with sustained high growth. These results, which hold for both revenue and headcount growth, highlight how reported growth rates and reported growth persistence rates can be engineered by the specific growth metric choices made. They also highlight how the commercial high growth company lists have an agenda that their lists understate the likelihood of early-stage companies achieving sustained high-growth. Implications for research, for media publishing high-growth company lists, and for the management of early-stage companies are discussed. |
| Date: | 2024–04 |
| URL: | https://d.repec.org/n?u=RePEc:ecl:stabus:4204 |
| By: | Albanese, Mattia; Aliberti, Manfredi (Rome Economics Doctorate) |
| Abstract: | Skills acquired on the job, whether general or industry-specific, significantly influence workers' labor market outcomes. Workers with general skills tend to have higher re-employment prospects and greater resilience to economic shocks. Using novel data from a recent policy intervention in the Italian labor market, we develop a new measure that captures the tasks taught in firm-provided training for individual workers. This measure enables us to examine the relationship between labor market competition and firms' decisions to invest in general versus industry-specific skills. Our findings indicate that, as theory predicts, workers in more competitive labor markets receive less general training. |
| Date: | 2024–10–30 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:4ugq5 |