Financial Development, Financial Fragility, and Growth

This paper studies the apparent contradiction between two strands of the literature on the effects of financial intermediation on economic activity. On the one hand, the empirical growth literature finds a positive effect of financial depth as measured by, for instance, private domestic credit and liquid liabilities (e.g., Levine, Loayza, and Beck 2000). On the other hand, the banking and currency crisis literature finds that monetary aggregates, such as domestic credit, are among the best predictors of crises and their related economic downturns (e.g., Kaminski and Reinhart 1999). The paper accounts for these contrasting effects based on the distinction between the short- and long-run impacts of financial intermediation. Working with a panel of cross-country and time-series observations, the paper estimates an encompassing model of short- and long-run effects using the Pooled Mean Group estimator developed by Pesaran, Shin, and Smith (1999). The conclusion from this analysis is that a positive long-run relationship between financial intermediation and output growth co-exists with a, mostly, negative short-run relationship. The paper further develops an explanation for these contrasting effects by relating them to recent theoretical models, by linking the estimated short-run effects to measures of financial fragility (namely, banking crises and financial volatility), and by jointly analyzing the effects of financial depth and fragility in classic panel growth regressions.

Financial development, financial fragility and growth

This paper studies the apparent contradiction between two strands of the literature on the effects of financial intermediation on economic activity. On the one hand, the empirical growth literature finds a positive effect of financial depth as measured by, for instance, private domestic credit and liquid liabilities (e.g., Levine, Loayza, and Beck 2000). On the other hand, the banking and currency crisis literature finds that monetary aggregates, such as domestic credit, are among the best predictors of crises and their related economic downturns (e.g., Kaminski and Reinhart 1999). The paper accounts for these contrasting effects based on the distinction between the short- and long-run impacts of financial intermediation. Working with a panel of cross-country and time-series observations, the paper estimates an encompassing model of short- and long-run effects using the Pooled Mean Group estimator developed by Pesaran, Shin, and Smith (1999). The conclusion from this analysis is that a positive long-run relationship between financial intermediation and output growth co-exists with a, mostly, negative short-run relationship. The paper further develops an explanation for these contrasting effects by relating them to recent theoretical models, by linking the estimated short-run effects to measures of financial fragility(namely, banking crises and financial volatility), and by jointly analyzing the effects of financial depth and fragility in classic panel growth regressions.

Correction of shading effects in vision-based UUV localization

This paper describes the improvements achieved in our mosaicking system to assist unmanned underwater vehicle navigation. A major advance has been attained in the processing of images of the ocean floor when light absorption effects are evident. Due to the absorption of natural light, underwater vehicles often require artificial light sources attached to them to provide the adequate illumination for processing underwater images. Unfortunately, these flashlights tend to illuminate the scene in a nonuniform fashion. In this paper a technique to correct non-uniform lighting is proposed. The acquired frames are compensated through a point-by-point division of the image by an estimation of the illumination field. Then, the gray-levels of the obtained image remapped to enhance image contrast. Experiments with real images are presented

Effects of P300-based BCI use on reported presence in a virtual environment

Brain-computer interfaces (BCIs) are becoming more and more popular as an input device for virtual worlds and computer games. Depending on their function, a major drawback is the mental workload associated with their use and there is significant effort and training required to effectively control them. In this paper, we present two studies assessing how mental workload of a P300-based BCI affects participants" reported sense of presence in a virtual environment (VE). In the first study, we employ a BCI exploiting the P300 event-related potential (ERP) that allows control of over 200 items in a virtual apartment. In the second study, the BCI is replaced by a gaze-based selection method coupled with wand navigation. In both studies, overall performance is measured and individual presence scores are assessed by means of a short questionnaire. The results suggest that there is no immediate benefit for visualizing events in the VE triggered by the BCI and that no learning about the layout of the virtual space takes place. In order to alleviate this, we propose that future P300-based BCIs in VR are set up so as require users to make some inference about the virtual space so that they become aware of it,which is likely to lead to higher reported presence.

No Major Differences Found between the Effects of Microwave-Based and Conventional Heat Treatment Methods on Two Different Liquid Foods

Extension of shelf life and preservation of products are both very important for the food industry. However, just as with other processes, speed and higher manufacturing performance are also beneficial. Although microwave heating is utilized in a number of industrial processes, there are many unanswered questions about its effects on foods. Here we analyze whether the effects of microwave heating with continuous flow are equivalent to those of traditional heat transfer methods. In our study, the effects of heating of liquid foods by conventional and continuous flow microwave heating were studied. Among other properties, we compared the stability of the liquid foods between the two heat treatments. Our goal was to determine whether the continuous flow microwave heating and the conventional heating methods have the same effects on the liquid foods, and, therefore, whether microwave heat treatment can effectively replace conventional heat treatments. We have compared the colour, separation phenomena of the samples treated by different methods. For milk, we also monitored the total viable cell count, for orange juice, vitamin C contents in addition to the taste of the product by sensory analysis. The majority of the results indicate that the circulating coil microwave method used here is equivalent to the conventional heating method based on thermal conduction and convection. However, some results in the analysis of the milk samples show clear differences between heat transfer methods. According to our results, the colour parameters (lightness, red-green and blue-yellow values) of the microwave treated samples differed not only from the untreated control, but also from the traditional heat treated samples. The differences are visually undetectable, however, they become evident through analytical measurement with spectrophotometer. This finding suggests that besides thermal effects, microwave-based food treatment can alter product properties in other ways as well.

Effects of unit - based pricing on the waste collection demand : a meta - regression analysis

We perform a meta - analysis of 21 studies that estimate the elasticity of the price of waste collection demand upon waste quantities, a prior literature review having revealed that the price elasticity differs markedly. Based on a meta - regression with a total of 65 observations, we find no indication that municipal data give higher estimates for price elasticities than those associated with household data. Furthermore, there is no evidence that treating prices as exogenous underestimates the price elasticity. We find that much of the variation can be explained by sample size, the use of a weight - based as opposed to a volume - based pricing system, and the pricing of compostable waste. We also show that price elasticities determined in the USA and point estimations of elasticities are more elastic, but these effects are not robust to the changing of model specifications. Finally, our tests show that there is no evidence of publication bias while there is some evidence of the existence of genuine empirical effect.

Market effects of foreign exchange coordinated intervention

In this article we develop a theoretical microstructure model of coordinated central bank intervention based on asymmetric information. We study the economic implications of coordination on some measures of market quality and show that the model predicts higher volatility and more significant exchange rate changes when central banks coordinate compared to when they intervene unilaterally. Both these predictions are in line with empirical evidence. Keywords: coordinated foreign exchange intervention, market microstructure. JEL Classification: D82, E58, F31, G14

Response of photosynthetic organisms to global change: an approach based on marker pigments

Report for the scientific sojourn carried out at the Department of Freshwater Ecology, National Environmetal Research Institute, Denmark, from 2006 to 2008. The main objective of the project was to reconstruct photosynthetic organism community composition using pigmentbased methods and to study their response to natural (e.g. climate) or anthropogenic (e.g. eutrophication) perturbations that took place in the system over time. We performed a study in different locations and at different temporal scales. We analysed the pigment composition in a short sediment record (46 cm sediment depth) of a volcanic lake (Lake Furnas) in the Azores Archipelago (Portugal). The lake has been affected during the last century by successive fish introductions. The specific objective was to reconstruct the lake’s trophic state history and to assess the role of land-use, climate and fish introductions in structuring the lake community. Results obtained suggested that whereas trophic cascade and changes in nutrient concentrations have some clear effects on algal and microbial assemblages, interpreting the effects of changes in climate are not straightforward. This is probably related with the rather constant precipitation in the Azores Islands during the studied period. We also analysed the pigment composition in a long sediment record (1800 cm sediment depth) of Lake Aborre (Denmark) covering ca. 8kyr of lake history. The specific objective was to describe changes in lake primary production and lake trophic state over the Holocene and to determine the photosynthetic organisms involved. Results suggested that external forcing (i.e. land use changes) was responsible of erosion and nutrient run off to the lake that contributed to the reported changes in lake primary production along most of the Holocene.

The Argentine ant (Linepithema humile) invasion effects on Mediterranean forests’ trophic web: blue tit (Parus caeruleus) reproduction and development

Les invasions biològiques representen una greu amenaça per al funcionament dels ecosistemes i per a la preservació de la biodiversitat.. La formiga argentina (Linepithema humile) està considerada com una de les 100 espècies invasores més nocives. Prospera en extenses àrees de clima mediterrani de regions temperades i subtropicals de tots els continents amb l’excepció de l’Antàrtida. És una formiga dominant i una competidora agressiva que mitjançant múltiples mecanismes, des de predació directe a competència, produeix efectes negatius en una amplia varietat de taxons, principalment formigues i altres artròpodes, però també vertebrats. S’ha investigat, per primera vegada, els efectes de la formiga invasiva sobre les comunitats d’artròpodes de fullatge i com aquestes pertorbacions es transmeten en la xarxa tròfica del bosc esclerofil•le mediterrani. En les suredes estudiades la invasió de formiga argentina és causa directe de la extinció local de la gran majoria de poblacions de formigues natives. En el període mostrejat s’han constatat també impactes negatius en la diversitat i en l’abundància d’artròpodes natius en les capçades dels arbres, particularment d’erugues. Una avaluació preliminar basada únicament amb dades del 2005 indica que, reduint la disponibilitat d’erugues, la formiga argentina empobreix l’hàbitat reproductiu de la mallerenga blava (Parus caeruleus). La mallerenga blava basa la dieta insectívora estricte de la seva pollada fonamentalment en les erugues. No hem detectat impactes en l’èxit reproductiu de les mallerengues blaves en zones envaïdes. Els polls crescuts en àrees envaïdes assoleixen una condició física similar als de les zones no envaïdes, però la reducció en la disponibilitat d’erugues associada a la invasió de formiga argentina es tradueix en un creixement descompassat i en una menor mida estructural del polls volanders. Així, les pertorbacions en la comunitat d’artròpodes associades a la invasió de la formiga argentina promouen efectes bottom-up que acaben perjudicant el desenvolupament dels polls de mallerenga blava.

Product differentiation, competitive pressure and the effects of innovation on the success and survivability of firms in oligopoly markets

In a recent paper Tishler and Milstein (2009) fi…nd that increased competition may increase aggregate R&D spending while market output decreases. Therefore, they obtain the surprising result that R&D spending is excessive when competition becomes intense. Their result is based on the standard linear demand function for differentiated products introduced by Bowley (1924) where decreased product differentiation is interpreted as more competitive pressure. In this paper I show that at an aggregate level this interpretation is problematic because equilibrium effects are dominated by a demand reduction effect. A slight modifi…cation of the standard demand function eliminates this effect. For the Tishler and Milstein (2009) setting it is shown that then increased competition increases both R&D spending and aggregate market output. Therefore, at least for consumers, more intense competition increases welfare. Journal of Economic Literature Classi…fication Numbers: D43, L1, O3. Keywords: Oligopoly markets, Product differentiation, Competitive pressure.

Environmental Tax on Products and Services Based on Their Carbon Footprint: A Case Study of the Pulp and Paper Sector

The main aim of this work is to define an environmental tax on products and services based on their carbon footprint. We examine the relevance of conventional life cycle analysis (LCA) and environmentally extended input-output analysis (EIO) as methodological tools to identify emission intensities of products and services on which the tax is based. The short-term price effects of the tax and the policy implications of considering non-GHG are also analyzed. The results from the specific case study on pulp production show that the environmental tax rate based on the LCA approach (1,8%) is higher than both EIO approaches (0,8% for product and 1,4% for industry approach), but they are comparable. Even though LCA is more product specific and provides detailed analysis, EIO would be the more relevant approach to apply economy wide environmental tax. When the environmental tax considers non-GHG emissions instead of only CO2, sectors such as agriculture, mining of coal and extraction of peat, and food exhibit higher environmental tax and price effects. Therefore, it is worthwhile for policy makers to pay attention on the implication of considering only CO2 tax or GHG emissions tax in order for such a policy measure to be effective and meaningful. Keywords: Environmental tax; Life cycle analysis; Environmental input-output analysis.

Medical image registration based on random line sampling

One of the key aspects in 3D-image registration is the computation of the joint intensity histogram. We propose a new approach to compute this histogram using uniformly distributed random lines to sample stochastically the overlapping volume between two 3D-images. The intensity values are captured from the lines at evenly spaced positions, taking an initial random offset different for each line. This method provides us with an accurate, robust and fast mutual information-based registration. The interpolation effects are drastically reduced, due to the stochastic nature of the line generation, and the alignment process is also accelerated. The results obtained show a better performance of the introduced method than the classic computation of the joint histogram

Ecological Footprint Inequality across countries: the role of environment intensity, income and interaction effects

Recently, White (2007) analysed the international inequalities in Ecological Footprints per capita (EF hereafter) based on a two-factor decomposition of an index from the Atkinson family (Atkinson (1970)). Specifically, this paper evaluated the separate role of environment intensity (EF/GDP) and average income as explanatory factors for these global inequalities. However, in addition to other comments on their appeal, this decomposition suffers from the serious limitation of the omission of the role exerted by probable factorial correlation (York et al. (2005)). This paper proposes, by way of an alternative, a decomposition of a conceptually similar index like Theil’s (Theil, 1967) which, in effect, permits clear decomposition in terms of the role of both factors plus an inter-factor correlation, in line with Duro and Padilla (2006). This decomposition might, in turn, be extended to group inequality components (Shorrocks, 1980), an analysis that cannot be conducted in the case of the Atkinson indices. The proposed methodology is implemented empirically with the aim of analysing the international inequalities in EF per capita for the 1980-2007 period and, amongst other results, we find that, indeed, the interactive component explains, to a significant extent, the apparent pattern of stability observed in overall international inequalities.

Economic and environmental effects of the CO2 taxation: an input-output analysis for Spain

CO2 emissions induced by human activities are the major cause of climate change; hence, strong environmental policy that limits the growing dependence on fossil fuel is indispensable. Tradable permits and environmental taxes are the usual tools used in CO2 reduction strategies. Such economic tools provide incentives to polluting industries to reduce their emissions through market signals. The aim of this work is to investigate the direct and indirect effects of an environmental tax on Spanish products and services. We apply an environmentally extended input-output (EIO) model to identify CO2 emission intensities of products and services and, accordingly, we estimate the tax proportional to these intensities. The short-term price effects are analyzed using an input-output price model. The effect of tax introduction on consumption prices and its influence on consumers’ welfare are determined. We also quantify the environmental impacts of such taxation in terms of the reduction in CO2 emissions. The results, based on the Spanish economy for the year 2007, show that sectors with relatively poor environmental profile are subjected to high environmental tax rates. And consequently, applying a CO2 tax on these sectors, increases production prices and induces a slight increase in consumer price index and a decrease in private welfare. The revenue from the tax could be used to counter balance the negative effects on social welfare and also to stimulate the increase of renewable energy shares in the most impacting sectors. Finally, our analysis highlights that the environmental and economic goals cannot be met at the same time with the environmental taxation and this shows the necessity of finding other (complementary or alternative) measures to ensure both the economic and ecological efficiencies. Keywords: CO2 emissions; environmental tax; input-output model, effects of environmental taxation.

Ecological Footprint Inequality across countries: the role of environment intensity, income and interaction effects

Recently, White (2007) analysed the international inequalities in Ecological Footprints per capita (EF hereafter) based on a two-factor decomposition of an index from the Atkinson family (Atkinson (1970)). Specifically, this paper evaluated the separate role of environment intensity (EF/GDP) and average income as explanatory factors for these global inequalities. However, in addition to other comments on their appeal, this decomposition suffers from the serious limitation of the omission of the role exerted by probable factorial correlation (York et al. (2005)). This paper proposes, by way of an alternative, a decomposition of a conceptually similar index like Theil’s (Theil, 1967) which, in effect, permits clear decomposition in terms of the role of both factors plus an inter-factor correlation, in line with Duro and Padilla (2006). This decomposition might, in turn, be extended to group inequality components (Shorrocks, 1980), an analysis that cannot be conducted in the case of the Atkinson indices. The proposed methodology is implemented empirically with the aim of analysing the international inequalities in EF per capita for the 1980-2007 period and, amongst other results, we find that, indeed, the interactive component explains, to a significant extent, the apparent pattern of stability observed in overall international inequalities. Key words: ecological footprint; international environmental distribution; inequality decomposition