Adoption of financial technologies: Implications for money demand and monetary policy

In this paper we argue that inventory models are probably not usefulmodels of household money demand because the majority of households does nothold any interest bearing assets. The relevant decision for most people is notthe fraction of assets to be held in interest bearing form, but whether to holdany of such assets at all. The implications of this realization are interesting and important. We find that(a) the elasticity of money demand is very small when the interest rate is small,(b) the probability that a household holds any amount of interest bearing assetsis positively related to the level of financial assets, and (c) the cost ofadopting financial technologies is positively related to age and negatively relatedto the level of education. Unlike the traditional methods of money demand estimation, our methodology allowsfor the estimation of the interest--elasticity at low values of the nominalinterest rate. The finding that the elasticity is very small for interest ratesbelow 5 percent suggests that the welfare costs of inflation are small. At interest rates of 6 percent, the elasticity is close to 0.5. We find thatroughly one half of this elasticity can be attributed to the Baumol--Tobin orintensive margin and half of it can be attributed to the new adopters or extensivemargin. The intensive margin is less important at lower interest rates and moreimportant at higher interest rates.

Social security in theory and practice (II): Efficiency theories, narrative theories and implications for reform

166 countries have some kind of public old age pension. What economic forcescreate and sustain old age Social Security as a public program? Mulligan and Sala-i-Martin (1999b) document several of the internationally and historically common features of social security programs, and explore "political" theories of Social Security. This paper discusses the "efficiency theories", which view creation of the SS program as a full of partial solution to some market failure. Efficiency explanations of social security include the "SS as welfare for the elderly" the "retirement increases productivity to optimally manage human capital externalities", "optimal retirement insurance", the "prodigal father problem", the "misguided Keynesian", the "optimal longevity insurance", the "governmenteconomizing transaction costs", and the "return on human capital investment". We also analyze four "narrative" theories of social security: the "chain letter theory", the "lump of labor theory", the "monopoly capitalism theory", and the "Sub-but-Nearly-Optimal policy response to private pensions theory".The political and efficiency explanations are compared with the international and historical facts and used to derive implications for replacing the typical pay-as-you-go system with a forced savings plan. Most of the explanations suggest that forced savings does not increase welfare, and may decrease it.

E-supply chain management: Review, implications and directions for future research

This paper analyses the interaction of two topics: Supply Chain Management (SCM) andInternet. Merging these two fields is a key area of concern for contemporary managers andresearchers. They have realized that Internet can enhance SCM by making real timeinformation available and enabling collaboration between trading partners. The aim of thispaper is to define e-SCM, analyze how research in this area has evolved during the period1995-2003 and identify some lines of further research. To do that a literature review inprestigious academic journals in Operations Management and Logistics has beenconducted.

Monetary policy in the Euro area: Lessons from 5 years of ECB and implications for Turkey

We examine monetary policy in the Euro area from both theoretical and empirical perspectives. We discuss what theory tells us the strategy of Central banks should be and contrasts it with the one employed by the ECB. We review accomplishments (and failures) of monetary policy in the Euro area and suggest changes that would increase the correlation between words and actions; streamline the understanding that markets have of the policy process; and anchor expectation formation more strongly. We examine the transmission of monetary policy shocks in the Euro area and in some potential member countries and try to infer the likely effects occurring when Turkey joins the EU first and the Euro area later. Much of the analysis here warns against having too high expectations of the economic gains that membership to the EU and Euro club will produce.

New evidence on inflation persistence and price stickiness in the Euro area: Implications for macro modelling

This paper evaluates new evidence on price setting practices and inflation persistence in the euro area with respect to its implications for macro modelling. It argues that several of the most commonly used assumptions in micro-founded macro models are seriously challenged by the new findings.

Implications of dynamic trading for insurance markets

We study the interaction between insurance and capital markets within singlebut general framework.We show that capital markets greatly enhance the risksharing capacity of insurance markets and the scope of risks that areinsurable because efficiency does not depend on the number of agents atrisk, nor on risks being independent, nor on the preferences and endowmentsof agents at risk being the same. We show that agents share risks by buyingfull coverage for their individual risks and provide insurance capitalthrough stock markets.We show that aggregate risk enters private insuranceas positive loading on insurance prices and despite that agents will buyfull coverage. The loading is determined by the risk premium of investorsin the stock market and hence does not depend on the agent s willingnessto pay. Agents provide insurance capital by trading an equally weightedportfolio of insurance company shares and riskless asset. We are able toconstruct agents optimal trading strategies explicitly and for verygeneral preferences.

Asset pricing implications of benchmarking: A two-factor CAPM

In this paper we consider the equilibrium effects of an institutionalinvestor whose performance is benchmarked to an index. In a partialequilibrium setting, the objective of the institutional investor is modeledas the maximization of expected utility (an increasing and concave function,in order to accommodate risk aversion) of final wealth minus a benchmark.In equilibrium this optimal strategy gives rise to the two-beta CAPM inBrennan (1993): together with the market beta a new risk-factor (that wecall active management risk) is brought into the analysis. This new betais deffined as the normalized (to the benchmark's variance) covariancebetween the asset excess return and the excess return of the market overthe benchmark index. Different to Brennan, the empirical test supports themodel's predictions. The cross-section return on the active management riskis positive and signifficant especially after 1990, when institutionalinvestors have become the representative agent of the market.

Development of the femur - Implications for age and sex determination.

Growth of four variables of the femur (diapyseal length, diaphyseal length plus distal epiphysis, maximum length and vertical diameter of the head) was analyzed by polynomial regression for the purpose of evaluating its significance and capacity for age and sex determination throughout the entire life continuum. Materials included in analysis consisted of 346 specimens ranging from birth to 97 years of age from five documented osteological collections of Western European descent. Linear growth was displayed by each of the four variables. Significant sexual dimorphism was identified in two of the femoral measurements, including maximum length and vertical diameter of the head, from age 15 onward. These results indicate that the two variables may be of use in the determination of sex in sex determination from that age onward. Strong correlation coefficients were identified between femoral size and age for each of the four metric variables. These results indicate that any of the femoral measurements is likely to serve as a useful source to estimate sub-adult age in both archaeological and forensic samples.

ß-Catenin Regulation during the Cell Cycle: Implications in G2/M and Apoptosis

ß-catenin is a multifunctional protein involved in cell-cell adhesion and Wnt signal transduction. ß-Catenin signaling has been proposed to act as inducer of cell proliferation in different tumors. However, in some developmental contexts and cell systems ß-catenin also acts as a positive modulator of apoptosis. To get additional insights into the role of ß-Catenin in the regulation of the cell cycle and apoptosis, we have analyzed the levels and subcellular localization of endogenous ß-catenin and its relation with adenomatous polyposis coli (APC) during the cell cycle in S-phase¿synchronized epithelial cells. ß-Catenin levels increase in S phase, reaching maximum accumulation at late G2/M and then abruptly decreasing as the cells enter into a new G1 phase. In parallel, an increased cytoplasmic and nuclear localization of ß-catenin and APC is observed during S and G2 phases. In addition, strong colocalization of APC with centrosomes, but not ß-catenin, is detected in M phase. Interestingly, overexpression of a stable form of ß-catenin, or inhibition of endogenous ß-catenin degradation, in epidermal keratinocyte cells induces a G2 cell cycle arrest and leads to apoptosis. These results support a role for ß-catenin in the control of cell cycle and apoptosis at G2/M in normal and transformed epidermal keratinocytes.

Rat splanchnic net oxygen consumption. Energetic implications

1. The blood flow, PO2, pH and PCO2 have been estimated in portal and suprahepatic veins as well as in hepatic artery of fed and overnight starved rats given an oral glucose load. From these data the net intestinal, hepatic and splanchnic balances for oxygen and bicarbonate were calculated. The oxygen consumption of the intact animal has also been measured under comparable conditions. 2. The direct utilization of oxygen balances as energy equivalents when establishing the contribution of energy metabolism of liver and intestine to the overall energy expenses of the rat, has been found to be incorrect, since it incorporates the intrinsic error of interorgan proton transfer through bicarbonate. Liver and intestine produced high net bicarbonate balances in all situations tested, implying the elimination (by means of oxidative pathways, i.e. consuming additional oxygen) of high amounts of H+ generated with bicarbonate. The equivalence in energy output of the oxygen balances was then corrected for bicarbonate production to 11-54% lower values. 3. Intestine and liver consume a high proportion of available oxygen, about one-half in basal (fed or starved) conditions and about one-third after gavage, the intestine consumption being about 15% in all situations tested and the liver decreasing its oxygen consumption with gavage.

Tax reforms and inequality: theoretical and empirical implications

In this paper we examine the effect of tax policy on the relationship between inequality and growth in a two-sector non-scale model. With non-scale models, the longrun equilibrium growth rate is determined by technological parameters and it is independent of macroeconomic policy instruments. However, this fact does not imply that fiscal policy is unimportant for long-run economic performance. It indeed has important effects on the different levels of key economic variables such as per capita stock of capital and output. Hence, although the economy grows at the same rate across steady states, the bases for economic growth may be different.The model has three essential features. First, we explicitly model skill accumulation, second, we introduce government finance into the production function, and we introduce an income tax to mirror the fiscal events of the 1980¿s and 1990¿s in the US. The fact that the non-scale model is associated with higher order dynamics enables it to replicate the distinctly non-linear nature of inequality in the US with relative ease. The results derived in this paper attract attention to the fact that the non-scale growth model does not only fit the US data well for the long-run (Jones, 1995b) but also that it possesses unique abilities in explaining short term fluctuations of the economy. It is shown that during transition the response of the relative simulated wage to changes in the tax code is rather non-monotonic, quite in accordance to the US inequality pattern in the 1980¿s and early 1990¿s.More specifically, we have analyzed in detail the dynamics following the simulation of an isolated tax decrease and an isolated tax increase. So, after a tax decrease the skill premium follows a lower trajectory than the one it would follow without a tax decrease. Hence we are able to reduce inequality for several periods after the fiscal shock. On the contrary, following a tax increase, the evolution of the skill premium remains above the trajectory carried on by the skill premium under a situation with no tax increase. Consequently, a tax increase would imply a higher level of inequality in the economy

Deciding the sale of a life policy in the viatical market: Implications on individual welfare

[cat] En aquest article, es presenta un model econòmic que permet determinar la venda o no d'una pòlissa de vida (total o en part) per part d'un assegurat malalt terminal en el mercat dels viatical settlements. Aquest mercat va aparèixer a finals de la dècada dels 80 a conseqüència de l'epidèmia de la SIDA. Actualment, representa una part del mercat dels life settlements. Les pòlisses que es comercialitzen en el mercat dels viaticals són aquelles on l'assegurat és malalt terminal amb una esperança de vida de dos anys o menys. El model és discret i considera només dos períodes (anys), ja que aquesta és la vida residual màxima que contempla el mercat. L'agent posseix una riquesa inicial que ha de repartir entre consum i herència. S'introdueix en primer lloc la funció d'utilitat esperada del decisor i, utilitzant programació dinàmica, es dedueix l'estratègia que reporta una utilitat més gran (no vendre/vendre (en part) la pòlissa en el moment zero/vendre (en part) la pòlissa en el moment ú). L'òptim depèn del preu de la pòlissa venuda i de paràmetres personals de l'individu. Es troba una expressió analítica per l'estratègia òptima i es realitza un anàlisi de sensibilitat.

Tax reforms and inequality: theoretical and empirical implications

In this paper we examine the effect of tax policy on the relationship between inequality and growth in a two-sector non-scale model. With non-scale models, the longrun equilibrium growth rate is determined by technological parameters and it is independent of macroeconomic policy instruments. However, this fact does not imply that fiscal policy is unimportant for long-run economic performance. It indeed has important effects on the different levels of key economic variables such as per capita stock of capital and output. Hence, although the economy grows at the same rate across steady states, the bases for economic growth may be different.The model has three essential features. First, we explicitly model skill accumulation, second, we introduce government finance into the production function, and we introduce an income tax to mirror the fiscal events of the 1980¿s and 1990¿s in the US. The fact that the non-scale model is associated with higher order dynamics enables it to replicate the distinctly non-linear nature of inequality in the US with relative ease. The results derived in this paper attract attention to the fact that the non-scale growth model does not only fit the US data well for the long-run (Jones, 1995b) but also that it possesses unique abilities in explaining short term fluctuations of the economy. It is shown that during transition the response of the relative simulated wage to changes in the tax code is rather non-monotonic, quite in accordance to the US inequality pattern in the 1980¿s and early 1990¿s.More specifically, we have analyzed in detail the dynamics following the simulation of an isolated tax decrease and an isolated tax increase. So, after a tax decrease the skill premium follows a lower trajectory than the one it would follow without a tax decrease. Hence we are able to reduce inequality for several periods after the fiscal shock. On the contrary, following a tax increase, the evolution of the skill premium remains above the trajectory carried on by the skill premium under a situation with no tax increase. Consequently, a tax increase would imply a higher level of inequality in the economy

Magnetostratigraphy of the Miocene continental deposits of the Montes de Castejón (central Ebro basin, Spain): geochronological and paleoenvironmental implications

A detailed magnetostratigraphic study has been carried out in the early to middle Miocene distal alluvial and lacustrine sediments of the Montes de Castejón (central Ebro Basin). The study was based on the analysis of 196 magnetostratigraphic sites sampled along a stratigraphic interval of about 240 meters. Local magnetostratigraphy yielded a sequence of 12 magnetozones (6 normal and 6 reverse) which could be correlated with the Geomagnetic Polarity Time Scale (GPTS) interval C5Cr to C5AD (between 17 and 14.3 Ma.). The sampled sedimentary sequences include the boundary between two tectosedimentary units (TSU, T5 and T6) already defined in the Ebro Basin. The magnetostratigraphy of the Montes de Castejón allows to date the T5/T6 TSU boundary at 16.14 Ma, within chron C5Cn.1n. This magnetostratigraphy also allows us to analyse in detail as well as to discuss the variations in sedimentation rates through space and time between different lacustrine environments: Outer carbonate lacustrine fringes and distal alluvial plains (Montes de Castejón sections) show higher sedimentation rates than offshore lacustrine areas (San Caprasio section, 50 km east of Montes de Castejón).

Unusual concentration of Early Albian arthropod-bearing amber in the Basque-Cantabrian Basin (El Soplao, Cantabria, Spain): Palaeoenvironmental and paleobiological implications.

The El Soplao site is a recently-discovered Early Albian locality of the Basque-Cantabrian Basin (northern Spain) that has yielded a number of amber pieces with abundant bioinclusions. The amber-bearing deposit occurs in a non-marine to transitional marine siliciclastic unit (Las Peñosas Formation) that is interleaved within a regressive-transgressive, carbonate-dominated Lower Aptian-Upper Albian marine sequence. The Las Peñosas Formation corresponds to the regressive stage of this sequence and in its turn it splits into two smaller regressive-transgressive cycles. The coal and amber-bearing deposits occur in deltaic-estuarine environments developed during the maximum regressive episodes of these smaller regressive-transgressive cycles. The El Soplao amber shows Fourier Transform Infrared Spectroscopy spectra similar to other Spanish Cretaceous ambers and it is characterized by the profusion of sub-aerial, stalactite-like flows. Well-preserved plant cuticles assigned to the conifer genera Frenelopsis and Mirovia are abundant in the beds associated with amber. Leaves of the ginkgoalean genera Nehvizdya and Pseudotorellia also occur occasionally. Bioinclusions mainly consist of fossil insects of the orders Blattaria, Hemiptera, Thysanoptera, Raphidioptera, Neuroptera, Coleoptera, Hymenoptera and Diptera, although some spiders and spider webs have been observed as well. Some insects belong to groups scarce in the fossil record, such as a new morphotype of the wasp Archaeromma (of the family Mymarommatidae) and the biting midge Lebanoculicoides (of the monogeneric subfamily Lebanoculicoidinae). This new amber locality constitutes a very significant finding that will contribute to improving the knowledge and comprehension of the Albian non-marine paleoarthropod fauna.