Macroeconomic information, structural change, and the prediction of fiscal aggregates

Previous research on the prediction of fiscal aggregates has shown evidence that simple autoregressive models often provide better forecasts of fiscal variables than multivariate specifications. We argue that the multivariate models considered by previous studies are small-scale, probably burdened by overparameterization, and not robust to structural changes. Bayesian Vector Autoregressions (BVARs), on the other hand, allow the information contained in a large data set to be summarized efficiently, and can also allow for time variation in both the coefficients and the volatilities. In this paper we explore the performance of BVARs with constant and drifting coefficients for forecasting key fiscal variables such as government revenues, expenditures, and interest payments on the outstanding debt. We focus on both point and density forecasting, as assessments of a country’s fiscal stability and overall credit risk should typically be based on the specification of a whole probability distribution for the future state of the economy. Using data from the US and the largest European countries, we show that both the adoption of a large system and the introduction of time variation help in forecasting, with the former playing a relatively more important role in point forecasting, and the latter being more important for density forecasting.

Sex-specific disruption of murine midbrain astrocytic and dopaminergic developmental trajectories following antenatal GC treatment

The mammalian midbrain dopaminergic systems arising in the substantia nigra pars compacta (SNc) and ventral tegmental area (VTA) are critical for coping behaviours and are implicated in neuropsychiatric disorders where early life challenges comprise significant risk factors. Here, we aimed to advance our hypothesis that glucocorticoids (GCs), recognised key players in neurobiological programming, target development within these systems, with a novel focus on the astrocytic population. Mice received antenatal GC treatment (AGT) by including the synthetic GC, dexamethasone, in the mothers' drinking water on gestational days 16-19; controls received normal drinking water. Analyses of regional shapes and volumes of the adult SNc and VTA demonstrated that AGT induced long-term, dose-dependent, structural changes that were accompanied by profound effects on astrocytes (doubling/tripling of numbers and/or density). Additionally, AGT induced long-term changes in the population size and distribution of SNc/VTA dopaminergic neurons, confirming and extending our previous observations made in rats. Furthermore, glial/neuronal structural remodelling was sexually dimorphic and depended on the AGT dose and sub-region of the SNc/VTA. Investigations within the neonatal brain revealed that these long-term organisational effects of AGT depend, at least in part, on targeting perinatal processes that determine astrocyte density and programmed cell death in dopaminergic neurons. Collectively, our characterisation of enduring, AGT-induced, sex-specific cytoarchitectural disturbances suggests novel mechanistic links for the strong association between early environmental challenge (inappropriate exposure to excess GCs) and vulnerability to developing aberrant behaviours in later life, with translational implications for dopamine-associated disorders (such as schizophrenia, ADHD, autism, depression), which typically show a sex bias