Confidence intervals for half-life deviations from purchasing power parity

Existing point estimates of half-life deviations from purchasing power parity (PPP), around 3-5 years, suggest that the speed of convergence is extremely slow. This article assesses the degree of uncertainty around these point estimates by using local-to-unity asymptotic theory to construct confidence intervals that are robust to high persistence in small samples. The empirical evidence suggests that the lower bound of the confidence interval is between four and eight quarters for most currencies, which is not inconsistent with traditional price-stickiness explanations. However, the upper bounds are infinity for all currencies, so we cannot provide conclusive evidence in favor of PPP either. © 2005 American Statistical Association.

Differences in mismatch responses to vowels and musical intervals: MEG evidence.

We investigated the electrophysiological response to matched two-formant vowels and two-note musical intervals, with the goal of examining whether music is processed differently from language in early cortical responses. Using magnetoencephalography (MEG), we compared the mismatch-response (MMN/MMF, an early, pre-attentive difference-detector occurring approximately 200 ms post-onset) to musical intervals and vowels composed of matched frequencies. Participants heard blocks of two stimuli in a passive oddball paradigm in one of three conditions: sine waves, piano tones and vowels. In each condition, participants heard two-formant vowels or musical intervals whose frequencies were 11, 12, or 24 semitones apart. In music, 12 semitones and 24 semitones are perceived as highly similar intervals (one and two octaves, respectively), while in speech 12 semitones and 11 semitones formant separations are perceived as highly similar (both variants of the vowel in 'cut'). Our results indicate that the MMN response mirrors the perceptual one: larger MMNs were elicited for the 12-11 pairing in the music conditions than in the language condition; conversely, larger MMNs were elicited to the 12-24 pairing in the language condition that in the music conditions, suggesting that within 250 ms of hearing complex auditory stimuli, the neural computation of similarity, just as the behavioral one, differs significantly depending on whether the context is music or speech.