Macroeconomics Commons^™

A Backward Bending Supply Of Loanable Funds: An Examination Of The Interest Rate Elasticity Of Saving, Rachel M. Doehr Ms.

Undergraduate Economic Review

The market for loanable funds is presented as either a market with an upward sloping supply curve, or as one with a perfectly inelastic supply. This paper relates the supply of loanable funds to the supply curve in the labor market: backward bending. Once interest rates are high enough, people start to save less, creating the "backward bend.” This explains the discrepancies in previous literature that attempted to put a single value on the interest rate elasticity saving. The reason for the variation in values could be because the elasticity actually depends on the point on the curve.

Will The U.S. Velocity Of Money Step Up Again? New Evidence From The Random Walk Hypothesis, Anh Thu Tran Xuan

Undergraduate Economic Review

The recent decrease in U.S. money velocity raises debates about its unit root behavior. This paper revisited the random walk hypothesis (RWH) of the U.S. money velocity in 1960-2010 and two sub-periods 1960-85 and 1986-2010 by applying the Variance Ratio methodologies, including new nonparametric tests by Wright (2000) and Belaire-Franch and Contreras (2004). The results suggested that the velocity would likely increase, and the U.S. monetary policy will soon stimulate GDP and employment. Furthermore, past velocity is important to predict the future outcomes, and changes in financial structural could alter the empirical characteristics of the velocity series.

The Spanish Export Led Recovery, David Wagner

Undergraduate Economic Review

I researched the export-led recovery currently taking place in Spain. My thesis revolved around Mariano Rajoy and the Popular Party coming into power in 2011 and instituting reforms in three distinct categories; financial market reforms, fiscal measures, and labor market reforms. These reforms have had a significant impact in restoring credibility in Spain's capital markets and decreasing unit labor costs. In turn, Spain has shown impressive export growth in the past two years, especially compared to its neighbors Italy and France.

Essays On The Changing Nature Of Business Cycle Fluctuations: A State-Level Study Of Jobless Recoveries And The Great Moderation, Jared David Reber

Graduate Theses and Dissertations

The behavior of several important macroeconomic variables has changed dramatically over the past several business cycles in the U.S. These changes, which began around the mid-1980s, have been viewed as somewhat puzzling given the stark contrast they exhibit to earlier post-war data. The movement of output and employment has historically been highly correlated throughout the different phases of the business cycle. However, this changed with the economic recovery of 1991. Since then, periods of output recovery have been accompanied by periods of prolonged job loss. These periods have come to be known as "jobless recoveries". Several competing explanations for this …

Experimental Evidence For Heterogeneous Expectations In A Simple New Keynesian Framework, Atticus David Holm Graven

Business and Economics Honors Papers

This paper is a two-dimensional analysis of agent behavior in a standard New Keynesian (NK) Macroeconomic model. On the dimension of pure mathematics, we analyze the parameters of the NK model and of possible prediction rules. On the other dimension we continue a practice of empirical study of heterogeneous expectations with an experiment. The experiment will ask participants to make predictions of future output and inflation. Their responses will create a data-set upon which analysis will be performed to illuminate and corroborate current theories of economic decision making. The literature has shown that most agents' forecasting rules can be modeled …

Game-Theoretic Foundations Of Monetary Equilibrium, Gabriele Camera, Alessandro Gioffré

Economics Faculty Articles and Research

According to theory, money supports trade in a world without enforcement and, in particular, in large societies, where gift-exchange is unsustainable. It is demonstrated that, in fact, monetary equilibrium breaks down in the absence of adequate enforcement institutions and it collapses as societies that lack external enforcement grow large. This unique result is derived by unveiling the existence of a tacit enforcement assumption in the literature that explains the advantages from monetary exchange, and by integrating monetary theory with the theory of repeated games and social norms.

A Theory Of Aggregate Consumption, Yun K. Kim, Mark Setterfield, Yuan Mei

Research Collection School Of Economics

We develop a Keynesian model of aggregate consumption. Our theory emphasizes the importance of the relative income hypothesis and debt finance for understanding household consumption behavior. It is shown that particular importance attaches to how net debtor households service their debts, and that the treatment of debt-servicing commitments as a substitute for savings by these households creates the potential for 'sudden stops' in consumption spending (and hence aggregate demand).

A Study Of Regional Economies In The United States, Tanios Bou Onk

Honors Program Theses and Research Projects

Using multiple time series based on data gathered from reliable government agencies I will compare the effects of national inflation, fluctuations in national GDP, and fluctuations in national employment on the personal income of multiple Metropolitan Statistical Areas (MSA), with the effects that local (MSA) inflation, fluctuations in local GDP, and fluctuations in local employment in multiple MSAs have on real national GDP. This analysis will be limited to four metropolitan areas, San Antonio, Texas, Philadelphia, Pennsylvania, San Diego, California, and Cincinnati-Hamilton, Ohio. These metropolitan areas are each in a different region located within the United States. This was done …

An Examination Of The Structural Inflation Dynamics In Nigeria, O. J. Odonye, S. O. Odeniran, A. O. Oduyemi, O. J. Olaoye, K. J. Ajayi

Economic and Financial Review

This study examines the dynamics of inflation in Nigeria, including the structural evolution as well as the direction of its movement with a view to designing appropriate policy measures to rein in the inflationary pressures. The study utilized quarterly data from 1970(1) to 2013 (4) except for Bureau de Change (BDC) premium where the duration was 1991(1) to 2013 (4) based on Auto Regressive Distributed Lag (ARDL) model. The results show that structural factors like budget deficit, rainfall, variation in export, exchange rate premium have profound influence on movement in CPI in Nigeria during the period.

Oil Price Shocks And Real Exchange Rate Movement In Nigeria, M. K. Tule, D. Osude

Economic and Financial Review

This paper investigated the relationship between oil price and real exchange rate movement in Nigeria. Crude oil exports account for over 90 per cent of Nigeria's foreign exchange earnings hence, the economy may be vulnerable to instability in international oil prices, which the country as a small open economy, cannot influence. Using monthly data covering the period 2000 to 2013, this study employs GARCH process to test the relationship between oil price and exchange rate volatility in Nigeria. The results of GARCH (1,1) and EGARCH (1,1) suggest the persistence of volatility between real oil prices and the real exchange rate. …

Central Bank Of Nigeria Annual Report And Statement Of Accounts For The Year Ended 31st December 2014, Central Bank Of Nigeria

CBN Annual Report

Annual Report and Financial Statements of the Central Bank of Nigeria (CBN) for the year ended 31st December, 2014. In general, 2014 has been a very eventful and challenging year for the Bank, the country, and the world at large. In the course of the year, the Bank underwent significant changes in its governance composition. In 2014, the global economy witnessed considerable vulnerabilities characterized by fragile growth and weak economic outlook. Global growth recovery was modest and continued to be threatened by strong downside risks, as a result of sharp drop in commodity prices, escalating geo-political tensions, and heightening threats …

A Simple Treatment Of The Liquidity Trap For Intermediate Macroeconomics Courses, Sebastien Buttet, Udayan Roy

Publications and Research

Several leading undergraduate intermediate macroeconomics textbooks now include a simple reduced-form New Keynesian model of short-run dynamics (alongside the IS-LM model). Unfortunately, there is no accompanying description of how the zero lower bound on nominal interest rates affects the model. In this article, the authors show how the aforementioned model can easily be modified to teach undergraduate students about the significance of the zero lower bound for economic performance and policy. This acquires additional significance because economies such as the United States and Japan have been close to the zero lower bound since 2008 and 1995, respectively. The authors show …

Coexistence Of Gm, Conventional And Organic Food Not Always Possible, Konstantinos Giannakas

CAFIO: Policy Research Group Policy Pagers

The coexistence of genetically modified (GM) products with their conventional and organic counterparts has been one of the most scrutinized issues surrounding the introduction of products of agricultural biotechnology into the agri-food system. Fears that the widespread adoption of GM products will drive their conventional (and, perhaps, organic) counterparts out of the market have been countered by arguments that their presence enhances the equilibrium product variety in the market. Central to the argument is, of course, the possibility of coexistence of GM, conventional and organic products with the main focus having been on farm production systems and the prospect of …

Understanding The Distributional Impact Of Long-Run Inflation, Gabriele Camera, Yili Chen

Economics Faculty Articles and Research

The impact of fully anticipated inflation is systematically studied in heterogeneous agent economies with an endogenous labor supply and portfolio choices. In stationary equilibrium, inflation nonlinearly alters the endogenous distributions of income, wealth, and consumption. Small departures from zero inflation have the strongest impact. Three features determine how inflation impacts distributions and welfare: financial structure, shock persistence, and labor supply elasticity. When agents can self-insure only with money, inflation reduces wealth inequality but may raise consumption inequality. Otherwise, inflation reduces consumption inequality but may raise wealth inequality. Given persistent shocks and an inelastic labor supply, inflation may raise average welfare. …

Mergers & Abenomics: The Determinants Of M&A In Japan's New Economy, Ethan S. Hallberg

CMC Senior Theses

This paper investigates the influence of various macroeconomic variables on Japan’s merger and acquisition (M&A) activity, both in terms of total deal value and total number of deals. Looking at monthly data from June 1997 to December 2013, I use econometric time-series analysis to find that: First, total deal value per month is not well explained by our macroeconomic variables, but about half of the variation in number of deals per month can be explained by our dataset. Second, the most important determinant in the total number of deals per month during our period is the level of national debt, …

The Coordination Value Of Monetary Exchange: Experimental Evidence, Gabriele Camera, Marco Casari

Economics Faculty Articles and Research

What institutions can sustain cooperation in groups of strangers? Here we study the role of monetary systems. In an experiment, subjects sometimes needed help and sometimes could incur a cost to help an anonymous counterpart. In the absence of money, the intertemporal exchange of help, which could be supported by a norm of community punishment of defectors, did not emerge. Introducing intrinsically worthless tokens substantially altered patterns of behavior. Monetary trade emerged, which increased predictability of play and promoted cooperation when strangers could trade help for a token.

Loose Notes, Anwar Shaikh Phd

Archives of Anwar Shaikh

This collection includes: (23-33_Loos... p. 1)

• Interview notes on the Great Recession by Anwar Shaikh, PhD (23-33_Loos... p. 2)
• Commentary on Juan Martín Graña's analysis by Anwar Shaikh, PhD (23-33_Loos... p. 3)
• Argentina variables data charts by Anwar Shaikh, PhD (23-33_Loos... p. 5)
• Notes on Streeck's lecture "Has capitalism seen its day?" by Anwar Shaikh, PhD (23-33_Loos... p. 6)
• Notes on Argentina development and industrial policy by Anwar Shaikh, PhD (23-33_Loos... p. 7)

Gmos And Iprs Are Key Weapons In Fight Against Hunger, Konstantinos Giannakas

CAFIO: Policy Research Group Policy Pagers

The introduction of genetically modified organisms (GMOs) into the food system and the assignment of intellectual property rights (IPRs) for plant genetic resources are among the most notable features of the increasingly industrialized agri-food marketing system of numerous developed and developing countries around the world. IPRs have provided innovating firms with incentives to aggressively pursue improvements of crop characteristics (such as herbicide tolerance, insect and virus resistance, drought tolerance and increased nutritional value) through gene splicing techniques, and the agronomic benefits associated with the genetically modified (GM) products have resulted in their embrace by a significant number of agricultural producers …

Ad Hoc Disaster And Crop Insurance Programs May Reduce The Use Of Risk-Reducing Conservation Tillage Practices, Karina Schoengold, Ya Ying, Russell Headlee

CAFIO: Policy Research Group Policy Pagers

There is growing concern that the risks facing agricultural producers are increasing due to several factors that include the predicted effects of climate change leading to more frequent floods, droughts, and higher temperatures as well greater use of agricultural outputs for nonfood energy products.

These risks are partially managed through federal agricultural programs. Ad hoc disaster payments have frequently been used to provide financial support.

Food Imports Under Foreign Exchange Constraints In The Cfa’S Franc Zone Of Sub-Saharan Africa (Ssa), Seydina Ousmane Sene

Theses and Dissertations--Agricultural Economics

To respond to the high imported food prices in their domestic markets, net food importing countries in the Communauté Financière Africaine (CFA) zone^[1] are adjusting their import tariffs and homologate domestic prices of imported commodities such as rice, wheat, maize, and sugar. This research uses a multivariate specification of error correction model (VECM) of estimation to investigate the link between food imports, world price index of rice, wheat, maize and sugar, real effective exchange rates, domestic food production, GDP, and trade openness in the short and long run. The data are on each homogenous commodity from 1969 to 2012. …