Patterns of convergence and divergence in the euro area

We study the extent of macroeconomic convergence/divergence among euro area countries. Our analysis focuses on four variables (unemployment, inflation, relative prices and the current account), and seeks to uncover the role played by monetary union as a convergence factor by using non-euro developed economies and the pre-EMU period as control samples.

Perturbations on domain walls and strings: A covariant theory

A covariant formalism is developed for describing perturbations on vacuum domain walls and strings. The treatment applies to arbitrary domain walls in (N+1)-dimensional flat spacetime, including the case of bubbles of a true vacuum nucleating in a false vacuum. Straight strings and planar walls in de Sitter space, as well as closed strings and walls nucleating during inflation, are also considered. Perturbations are represented by a scalar field defined on the unperturbed wall or string world sheet. In a number of interesting cases, this field has a tachyonic mass and a nonminimal coupling to the world-sheet curvature.

Quantum fluctuations on domain walls, strings, and vacuum bubbles

We develop a covariant quantum theory of fluctuations on vacuum domain walls and strings. The fluctuations are described by a scalar field defined on the classical world sheet of the defects. We consider the following cases: straight strings and planar walls in flat space, true vacuum bubbles nucleating in false vacuum, and strings and walls nucleating during inflation. The quantum state for the perturbations is constructed so that it respects the original symmetries of the classical solution. In particular, for the case of vacuum bubbles and nucleating strings and walls, the geometry of the world sheet is that of a lower-dimensional de Sitter space, and the problem reduces to the quantization of a scalar field of tachyonic mass in de Sitter space. In all cases, the root-mean-squared fluctuation is evaluated in detail, and the physical implications are briefly discussed.

Black holes from nucleating strings

We evaluate the probability that a loop of string that has spontaneously nucleated during inflation will form a black hole upon collapse, after the end of inflation. We then use the observational bounds on the density of primordial black holes to put constraints on the parameters of the model. Combining these constraints with current upper limits on the expansion rate during inflation, we conclude that the density of black holes formed from nucleating strings is too low to be observed. Also, constraints on domain wall nucleation and monopole pair production during inflation are briefly discussed.

Nucleation rates in flat and curved space

Nucleation rates for tunneling processes in Minkowski and de Sitter space are investigated, taking into account one loop prefactors. In particular, we consider the creation of membranes by an antisymmetric tensor field, analogous to Schwinger pair production. This can be viewed as a model for the decay of a false (or true) vacuum at zero temperature in the thin wall limit. Also considered is the spontaneous nucleation of strings, domain walls, and monopoles during inflation. The instantons for these processes are spherical world sheets or world lines embedded in flat or de Sitter backgrounds. We find the contribution of such instantons to the semiclassical partition function, including the one loop corrections due to small fluctuations around the spherical world sheet. We suggest a prescription for obtaining, from the partition function, the distribution of objects nucleated during inflation. This can be seen as an extension of the usual formula, valid in flat space, according to which the nucleation rate is twice the imaginary part of the free energy. For the case of pair production, the results reproduce those that can be obtained using second quantization methods, confirming the validity of instanton techniques in de Sitter space. Throughout the paper, both the gravitational field and the antisymmetric tensor field are assumed external.

Recycling universe

If the effective cosmological constant is nonzero, our observable universe may enter a stage of exponential expansion. In such a case, regions of it may tunnel back to the false vacuum of an inflaton scalar field, and inflation with a high expansion rate may resume in those regions. An ideal eternal observer would then witness an infinite succession of cycles from false vacuum to true, and back. Within each cycle, the entire history of a hot universe would be replayed. If there were several minima of the inflaton potential, our ideal observer would visit each one of these minima with a frequency which depends on the shape of the potential. We generalize the formalism of stochastic inflation to analyze the global structure of the universe when this recycling process is taken into account.

Brane-world creation and black holes

An inflating brane world can be created from ``nothing'' together with its anti-de Sitter (AdS) bulk. The resulting space-time has compact spatial sections bounded by the brane. During inflation, the continuum of KK modes is separated from the massless zero mode by the gap m=(3/2)H, where H is the Hubble rate. We consider the analogue of the Nariai solution and argue that it describes the pair production of ``black cigars'' attached to the inflating brane. In the case when the size of the instantons is much larger than the AdS radius, the 5-dimensional action agrees with the 4-dimensional one. Hence, the 5D and 4D gravitational entropies are the same in this limit. We also consider thermal instantons with an AdS black hole in the bulk. These may be interpreted as describing the creation of a hot universe from nothing or the production of AdS black holes in the vicinity of a pre-existing inflating brane world. The Lorentzian evolution of the brane world after creation is briefly discussed. An additional ``integration constant'' in the Friedmann equation-accompanying a term which dilutes like radiation-describes the tidal force in the fifth direction and arises from the mass of a spherical object inside the bulk. In general, this could be a 5-dimensional black hole or a ``parallel'' brane world of negative tension concentrical with our brane-world. In the case of thermal solutions, and in the spirit of the AdS/CFT correspondence, one may attribute the additional term to thermal radiation in the boundary theory. Then, for temperatures well below the AdS scale, the entropy of this radiation agrees with the entropy of the black hole in the AdS bulk.

Many worlds in one

A generic prediction of inflation is that the thermalized region we inhabit is spatially infinite. Thus, it contains an infinite number of regions of the same size as our observable universe, which we shall denote as O regions. We argue that the number of possible histories which may take place inside of an O region, from the time of recombination up to the present time, is finite. Hence, there are an infinite number of O regions with identical histories up to the present, but which need not be identical in the future. Moreover, all histories which are not forbidden by conservation laws will occur in a finite fraction of all O regions. The ensemble of O regions is reminiscent of the ensemble of universes in the many-world picture of quantum mechanics. An important difference, however, is that other O regions are unquestionably real.

Cosmological perturbations from stochastic gravity

In inflationary cosmological models driven by an inflaton field the origin of the primordial inhomogeneities which are responsible for large-scale structure formation are the quantum fluctuations of the inflaton field. These are usually calculated using the standard theory of cosmological perturbations, where both the gravitational and the inflaton fields are linearly perturbed and quantized. The correlation functions for the primordial metric fluctuations and their power spectrum are then computed. Here we introduce an alternative procedure for calculating the metric correlations based on the Einstein-Langevin equation which emerges in the framework of stochastic semiclassical gravity. We show that the correlation functions for the metric perturbations that follow from the Einstein-Langevin formalism coincide with those obtained with the usual quantization procedures when the scalar field perturbations are linearized. This method is explicitly applied to a simple model of chaotic inflation consisting of a Robertson-Walker background, which undergoes a quasi-de Sitter expansion, minimally coupled to a free massive quantum scalar field. The technique based on the Einstein-Langevin equation can, however, deal naturally with the perturbations of the scalar field even beyond the linear approximation, as is actually required in inflationary models which are not driven by an inflaton field, such as Starobinsky¿s trace-anomaly driven inflation or when calculating corrections due to nonlinear quantum effects in the usual inflaton driven models.

Migration Flows and Quality of Life in a Metropolitan Area: the Case of Barcelona-Spain

The phenomenon of human migration is certainly not new and it has been studied from a variety of perspectives. Yet, the attention on human migration and its determinant has not been fading over time as confirmed by recent contributions (see for instance Cushing and Poot 2004 and Rebhun and Raveh 2006). In this paper we combine the recent theoretical contributions by Douglas (1997) and Wall (2001) with the methodological advancements of Guimarães et al. (2000, 2003) to model inter-municipal migration flows in the Barcelona area. In order to do that, we employ two different types of count models, i.e. the Poisson and negative binomial and compare the estimations obtained. Our results show that, even after controlling for the traditional migration factors, QoL (measured with a Composite Index which includes numerous aspects and also using a list of individual variables) is an important determinant of short distance migration movements in the Barcelona area.

The effects of monetary policy on stock market bubbles: Some evidence

We estimate the response of stock prices to exogenous monetary policy shocks usinga vector-autoregressive model with time-varying parameters. Our evidence points toprotracted episodes in which, after a a short-run decline, stock prices increase persistently in response to an exogenous tightening of monetary policy. That responseis clearly at odds with the "conventional" view on the effects of monetary policy onbubbles, as well as with the predictions of bubbleless models. We also argue that it isunlikely that such evidence be accounted for by an endogenous response of the equitypremium to the monetary policy shocks.

On the inefficiency of the restricted maximum likelihood

The restricted maximum likelihood is preferred by many to the full maximumlikelihood for estimation with variance component and other randomcoefficientmodels, because the variance estimator is unbiased. It is shown that thisunbiasednessis accompanied in some balanced designs by an inflation of the meansquared error.An estimator of the cluster-level variance that is uniformly moreefficient than the fullmaximum likelihood is derived. Estimators of the variance ratio are alsostudied.

La liberalización de las telecomunicaciones en España : control de la inflación y universalización del servicio

Los estudios sobre la liberalización han enfatizado la importancia de las presiones externas en el impulso a las reformas pro mercado. Sin negar esta influencia, en este trabajo sostenemos que son los intereses nacionales los que determinan la estrategia y ritmos de la liberalización. La liberalización de las telecomunicaciones realizada en España en el período 1987-2003 presenta diferencias significativas respecto a la de otros países de la UE. Esas diferencias están relacionadas con las estrategias que se adoptaron internamente al ver cómo la liberalización podía afectar a los objetivos de política económica general. El artículo destaca la existencia de dos tipos de conflictos. En primer lugar, la tensión entre, por un lado, la necesidad de universalizar el acceso al servicio y, por otro, la de reducir los precios de las telecomunicaciones con el objetivo de controlar la inflación. En segundo lugar, los reformadores españoles tuvieron que escoger entre un modelo de competencia intraplataforma que permitiera a los entrantes utilizar la red de Telefónica a precios reducidos y asegurase rápidas reducciones de precios o un modelo de competencia inter-plataforma que fomentase la inversión, la competencia tecnológica y el bienestar a largo plazo. La consideración de estos conflictos internos es clave para entender la economía política de la política española de telecomunicaciones. Nuestra conclusión es que la liberalización en España se vio frenada cuando entró en conflicto con objetivos de interés general internos, pero se aceleró cuando fue percibida como un instrumento útil para el logro de los interesas nacionales.

Pass-through in dollarized countries: should Ecuador abandon the U.S. Dollar?

In this article we examine the convenience of dollarization for Ecuador today. As Ecuador is strongly integrated financially and commercially with the United States, the exchange rate pass-through should be zero. However, we sustain that rising rates of imports from trade partners other than the United States and subsequent real effective exchange rate depreciations are causing the pass-through to move away from zero. Here, in the framework of the Vector Error Correction Model, we analyse the impulse response function and variance decomposition of the inflation variable. We show that the developing economy of Ecuador is importing inflation from its main trading partners, most of them emerging countries with appreciated currencies. We argue that if Ecuador recovered both its monetary and exchange rate instruments it would be able to fight against inflation. We believe such an analysis could be extended to other countries with pegged exchange rate regimes.

Estimating the effects of fiscal policy under the budget constraint

I reconsider the short-term effects of fiscal policy when both government spending and taxes are allowed to respond to the level of public debt. I embed the long-term government budget constraint in a VAR, and apply this common trends model to US quarterly data. The results overturn some widely held beliefs on fiscal policy effects. The main finding is that expansionary fiscal policy has contractionary effects on output and inflation. Ricardian effects may dominate when fiscal expansions are expected to be adjusted by future tax rises or spending cuts. The evidence supports RBC models with distortionary taxation. We can discard some alternative interpretations that are based on monetary policy reactions or supply-side effects.