Interprovincial disparities in China since the reforms: Convergence or divergence?

This paper investigates the extent of disparities amongst the provinces of China since the economic reform in 1978 up to the most recent year for which data is available. After a brief review of theoretical and in particular recent empirical literature on regional inequality in China it investigates whether or not the dynamic economic growth in China has been coupled with increasing disparities amongst the Chinese provinces. The paper utilises a few models of convergence along the lines of those hypothesised by neoclassical economists. It employs per capita income and per capita consumption to identify the possible absolute and conditional convergence since the economic reforms. The coverage and impact of the disparities in terms of the relative size of population affected are then taken into account in the analysis of inequality in income and consumption.

Microstructure Order Flow: Statistical and Economic Evaluation of Nonlinear Forecasts

In this paper we propose a novel empirical extension of the standard market microstructure order flow model. The main idea is that heterogeneity of beliefs in the foreign exchange market can cause model instability and such instability has not been fully accounted for in the existing empirical literature. We investigate this issue using two di¤erent data sets and focusing on out- of-sample forecasts. Forecasting power is measured using standard statistical tests and, additionally, using an alternative approach based on measuring the economic value of forecasts after building a portfolio of assets. We nd there is a substantial economic value on conditioning on the proposed models.

Estimating United States Phillips Curves With Expectations Consistent With The Statistical Process Of Inflation

‘Modern’ Phillips curve theories predict inflation is an integrated, or near integrated, process. However, inflation appears bounded above and below in developed economies and so cannot be ‘truly’ integrated and more likely stationary around a shifting mean. If agents believe inflation is integrated as in the ‘modern’ theories then they are making systematic errors concerning the statistical process of inflation. An alternative theory of the Phillips curve is developed that is consistent with the ‘true’ statistical process of inflation. It is demonstrated that United States inflation data is consistent with the alternative theory but not with the existing ‘modern’ theories.

UK House Prices: Convergence Clubs and Spillovers

This paper uses the log t test to analyse the convergence of house prices across UK regions and the presence of spillovers e ects. We nd that UK house prices can be grouped into four clusters. Moreover we document the dynamics of the house price spillovers across regions.

'Modern' Phillips Curves and the Implications For The Statistical Process of Inflation

'Modern' theories of the Phillips curve imply that inflation is an integrated, or near integrated process. This paper explains this implication and why these 'modern' theories are logically inconsistent with what is commonly known about the statistical process of inflation.