Panel unit root tests in the presence of cross-sectional dependence: finite sample performance and an application

This paper examines the finite sample properties of three testing regimes for the null hypothesis of a panel unit root against stationary alternatives in the presence of cross-sectional correlation. The regimes of Bai and Ng (2004), Moon and Perron (2004) and Pesaran (2007) are assessed in the presence of multiple factors and also other non-standard situations. The behaviour of some information criteria used to determine the number of factors in a panel is examined and new information criteria with improved properties in small-N panels proposed. An application to the efficient markets hypothesis is also provided. The null hypothesis of a panel random walk is not rejected by any of the tests, supporting the efficient markets hypothesis in the financial services sector of the Australian Stock Exchange.

PANEL DATA UNIT ROOT TEST WITH FIXED TIME DIMENSION

The consideration of the limit theory in which T is fixed and N is allowed to go to infinity improves the finite-sample properties of the tests and avoids the imposition of the relative rates at which T and N go to infinity.

Variation in stable carbon isotope fractionation during aerobic degradation of phenol and benzoate by contaminant degrading bacteria

Variation in the natural abundance stable carbon isotope composition of respired CO2 and biomass has been measured for two types of aerobic bacteria found in contaminated land sites. Pseudomonas putida strain NCIMB 10015 was cultured on phenol and benzoate and Rhodococcus sp. I-1 was cultured on phenol. Results indicate that aerobic isotope fractionations of differing magnitudes occur during aerobic biodegradation of these substrates with an isotopic depletion in the CO2 (Delta(13)C(phenol-CO2)) as much as 3.7 parts per thousand and 5.6 parts per thousand for Pseudomonas putida and Rhodococcus sp. I-1 respectively. This observation has significant implications for the use of a stable isotope mass balance approach in monitoring degradation processes that rely on indigenous bacterial populations. The effects of the metabolic pathway utilised in degradation and inter-species variation on the magnitude of isotope fractionation are discussed. Possible explanations for the observed isotope fractionation include differences in the metabolic pathways utilised by the organisms and differences in specific growth rates and physiology. (C) 1999 Elsevier Science Ltd. All rights reserved.