Exchange rate overvaluation under hyperinflation: The case of Peru

This dissertation examines the behavior of the exchange rate under two different scenarios. The first one is characterized by, relatively, low inflation or a situation where prices adjust sluggishly. The second is a high inflation economy where prices respond very rapidly even to unanticipated shocks. In the first one, following a monetary expansion, the exchange rate overshoots, i.e. the nominal exchange rate depreciates at a faster pace than the price level. Under high levels of inflation, prices change faster than the exchange rate so the exchange rate undershoots its long run equilibrium value.^ The standard work in this area, Dornbusch (1976), explains the overshooting process in the context of perfect capital mobility and sluggish adjustment in the goods market. A monetary expansion will make the exchange rate increase beyond its long run equilibrium value. This dissertation expands on Dornbusch's model and provides an analysis of the exchange rate under conditions of currency substitution and price flexibility, characteristics of the Peruvian economy during the hyper inflation process that took place at the end of the 1980's. The results of the modified Dornbusch model reveal that, given a monetary expansion, the change in the price level will be larger than the change in the exchange rate if prices react more than proportionally to the monetary shock.^ We will expect this over-reaction in circumstances of high inflation when the velocity of money is increasing very rapidly. Increasing velocity of money, gives rise to a higher relative price variability which in turn contributes to the appearance of new financial (and also non-financial) instruments that report a higher return than the exchange rate, causing people to switch their demand for foreign exchange to this new assets. In the context of currency substitution, economic agents hoard and use foreign exchange as a store of value. The big decline in output originated by hyper inflation induces people to sell this hoarded money to finance current expenses, increasing the supply of foreign exchange in the market. Both, the decrease in demand and the increase in supply reduce the price of foreign exchange i.e. the real exchange rate. The findings mentioned above are tested using Peruvian data for the period January 1985-July 1990, the results of the econometric estimation confirm our findings in the theoretical model. ^

Ecosystem responses to hydrologic change and mechanisms of nitrogen sequestration in seasonally flooded tree islands of the southern Everglades

In the Florida Everglades, tree islands are conspicuous heterogeneous elements in a complex wetland landscape. I investigated the effects of increased freshwater flow in southern Everglades seasonally flooded tree islands, and characterized biogeochemical interactions among tree islands and the marsh landscape matrix, specifically examining hydrologic flows of nitrogen (N), and landscape N sequestration capacity. I utilized ecological trajectories of key ecosystem variables to differentiate effects of increased sheetflow and hydroperiod. I utilized stable isotope analyses and nutrient content of tree island ecosystem components to test the hypothesis that key processes in tree island nitrogen cycling would favor ecosystem N sequestration. I combined estimates of tree island ecosystem N standing stocks and fluxes, soil and litter N transformation rates, and hydrologic inputs of N to quantify the net sequestration of N by a seasonally flooded tree island. ^ Results show that increased freshwater flow to seasonally flooded tree islands promoted ecosystem oligotrophy, whereas reduced flows allowed some plant species to cycle P less efficiently. As oligotrophy is a defining parameter of Everglades wetlands, and likely promotes belowground production and peat development, reintroducing freshwater flow from an upstream canal had a favorable effect on ecosystem dynamics of tree islands in the study area. Important factors influencing the stable isotopic composition of nitrogen and carbon were: (1) a contribution to soil N by soil invertebrates, animal excrement, and microbes, (2) a possible NO3 source from an upstream canal and an "open" ecosystem N cycle, and (3) greater availability of phosphorus in tree islands relative to the marsh landscape, suggesting that tree island N cycling favors N sequestration. Hydrologic sources of N were dominated by surface water loads of NO3- and NH 4+, and an important soil N transformation promoting the net loss of surface water DIN was nitrate immobilization associated with soils and surficial leaf litter. The net inorganic N sequestration capacity of a seasonally flooded tree island was 50 g yr-1 m -2. Thus, tree islands likely have an important function in landscape sequestration of inorganic N, and may reduce significant anthropogenic N loads to downstream coastal systems. ^

Life cycle of Deccan trap magma chambers: A crystal scale elemental and strontium isotopic investigation

The Deccan Trap basalts are the remnants of a massive series of lava flows that erupted at the K/T boundary and covered 1-2 million km2 of west-central India. This eruptive event is of global interest because of its possible link to the major mass extinction event, and there is much debate about the duration of this massive volcanic event. In contrast to isotopic or paleomagnetic dating methods, I explore an alternative approach to determine the lifecycle of the magma chambers that supplied the lavas, and extend the concept to obtain a tighter constraint on Deccan’s duration. My method relies on extracting time information from elemental and isotopic diffusion across zone boundaries in individual crystals. I determined elemental and Sr-isotopic variations across abnormally large (2-5 cm) plagioclase crystals from the Thalghat and Kashele “Giant Plagioclase Basalts” from the lowermost Jawhar and Igatpuri Formations respectively in the thickest Western Ghats section near Mumbai. I also obtained bulk rock major, trace and rare earth element chemistry of each lava flow from the two formations. Thalghat flows contain only 12% zoned crystals, with 87 Sr/86Sr ratios of 0.7096 in the core and 0.7106 in the rim, separated by a sharp boundary. In contrast, all Kashele crystals have a wider range of 87Sr/86Sr values, with multiple zones. Geochemical modeling of the data suggests that the two types of crystals grew in distinct magmatic environments. Modeling intracrystalline diffusive equilibration between the core and rim of Thalghat crystals led me to obtain a crystal growth rate of 2.03x10-10 cm/s and a residence time of 780 years for the crystals in the magma chamber(s). Employing some assumptions based on field and geochronologic evidence, I extrapolated this residence time to the entire Western Ghats and obtained an estimate of 25,000–35,000 years for the duration of Western Ghats volcanism. This gave an eruptive rate of 30–40 km3/yr, which is much higher than any presently erupting volcano. This result will remain speculative until a similarly detailed analytical-modeling study is performed for the rest of the Western Ghats formations.

The European Parliament, membership expansions, and organizational change

The European Union (EU) is an extraordinary achievement. From a regional economic organization, it grew into a polity within fifty years. The original EU of six members expanded incrementally to 27 over forty years, and it now comprises a population of almost 500 million people. While the five expansions of the European Economic Community/European Community/European Union (EU) have received considerable scholarly attention, surprisingly little attention has been given to their impacts on "Europe's" only legislative body, currently known as the European Parliament (EP). More specifically, little is known about how waves of new members (from widely diverse parties and national backgrounds) affected—and were affected by—the EP's organizational structure and its internal processes. The purpose of this study therefore is to help fill this gap by describing and explaining how the various EEC/EC/EU expansions or "membership shocks" (1973, 1981, 1986, 1995, and 2004) affected the EP's organizational structure and its internal Rules of Procedure (RoP). The central research question of this dissertation is the following: What were the major structural and procedural effects of the five membership expansions of what eventually became the European Union on the European Parliament? This dissertation answers this question by using concepts and measures drawn from organizational theory. While other studies have applied concepts and hypotheses from organizational theory to legislatures, such an approach has never been used to analyze the EP, which is conceptualized here as a "membership organization." This study, through an analysis of the EP, demonstrates that organization theory can help us fully understand the effects of membership expansions on any membership organization. That is, understanding how this particular organization responded to change can inform not only how others in this class (legislatures) do so, but how this process unfolds in a variety of times and places. The principal findings of this study are as follows: (1) EP staff growth revealed an interesting pattern: Staff did not increase concurrently with EP membership. That is, it turned out that the rate of membership growth exceeded the rate of staff increase, suggesting professionalization of EP staff and their relative empowerment vis-à-vis MEPs; (2) The number of rules and the precision within them increased; (3) the largest number of EP rule changes focused on increasing EP efficiency; and (4) The authority was centralized in the hands of EP leadership, that is, the EP President, the Conference of Presidents and also two major political groups.

Carbon and nitrogen stable isotopic patterns in South Florida coastal ecosystems: Modern and paleoceanographic perspectives

Long term management plans for restoration of natural flow conditions through the Everglades increase the importance of understanding potential nutrient impacts of increased freshwater delivery on coastal biogeochemistry. The present study sought to increase understanding of the coastal marine system of South Florida under modern conditions and through the anthropogenic changes in the last century, on scales ranging from individual nutrient cycle processes to seasonal patterns in organic material (OM) under varying hydrodynamic regime, to century scale analysis of sedimentary records. In all applications, carbon and nitrogen stable isotopic compositions of OM were examined as natural recorders of change and nutrient cycling in the coastal system. ^ High spatial and temporal variability in stable isotopic compositions were observed on all time scales. During a transient phytoplankton bloom, δ 15N values suggested nitrogen fixation as a nutrient source supporting enhanced productivity. Seasonally, particulate organic material (POM) from ten sites along the Florida Reef Tract and in Florida Bay demonstrated variable fluctuations dependent on hydrodynamic setting. Three separate intra-annual patterns were observed, yet statistical differences were observed between groupings of Florida Bay and Atlantic Ocean sites. The POM δ 15N values ranged on a quarterly basis by 7‰, while δ 13C varied by 22‰. From a sediment history perspective, four cores collected from Florida Bay further demonstrated the spatial and temporal variability of the system in isotopic composition of bulk OM over time. Source inputs of OM varied with location, with terrestrial inputs dominating proximal to Everglades freshwater discharge, seagrasses dominating in open estuary cores, and a marine mixture of phytoplankton and seagrass in a core from the boundary zone between Florida Bay and the Gulf of Mexico. Significant shifts in OM geochemistry were observed coincident with anthropogenic events of the 20th century, including railroad and road construction in the Florida Keys and Everglades, and also the extensive drainage changes in Everglades hydrology. The sediment record also preserved evidence of the major hurricanes of the last century, with excursions in geochemical composition coincident with Category 4-5 storms. ^

Carbon isotopic composition of cypress trees from South Florida and changing hydrologic condition

δ13C values were determined from cypresstree rings from two different study areas in SouthFlorida. One site is located in the Southeastern Everglades Marsh, where pond cypress (Taxodium ascendens) was sampled from tree islands (annual tree rings from 1970 to 2000). Bald cypress (Taxodium distichum) trees were sampled at the other site, located along the Loxahatchee River in a coastal wetland (decadal tree rings from 1830 to 1990). The isotopic time series from both sites display different, location-specific information. The pond cypressisotopic time series has a positive correlation with the total amount of annual precipitation, while the bald cypress data from the Loxahatchee River study area had two different records dependent on the level of saltwater stress. In general, for terrestrial trees growing in a temperate environment, water stress causes an increase in water-use efficiency (WUE) resulting in a relative 13C enrichment. Yet, trees growing in wetland settings in some cases do not respond in the same manner. We propose a conceptual model based on changes in carbon assimilation and isotopic fractionation as controlled by differences in stomatal resistance (water stress) and mesophyll resistance (biochemical and nutrient related) to explain the isotopic records from both sites. With further work and a longer time series, our approach may be tested, and used to reconstruct change in hydroperiods further back in time, and potentially provide a baseline for wetland restoration.

Climate Change and Regions at Risk: A Look at Central America

Climate change has been a security issue for mankind since Homo sapiens first emerged on the planet, driving him to find new and better food, water, shelter, and basic resources for survival and the advancement of civilization. Only recently, however, has the rate of climate change coupled with man’s knowledge of his own role in that change accelerated, perhaps profoundly, changing the security paradigm. If we take a ―decades‖ look at the security issue, we see competition for natural resources giving way to Cold War ideological containment and deterrence, itself giving way to non-state terrorism and extremism. While we continue to defend against these threats, we are faced with even greater security challenges that inextricably tie economic, food and human security together and where the flash points may not provide clearly discernable causes, as they will be intrinsically tied to climate change. Several scientific reports have revealed that the modest development gains that can be realized by some regions could be reversed by climate change. This means that climate change is not just a long-term environmental threat as was widely believed, but an economic and developmental disaster that is unfolding. As such, addressing climate change has become central to the development and poverty reduction by the World Bank and other financial institutions. In Latin America, poorer countries and communities, such as those found in Central America, will suffer the hardest because of weaker resilience and greater reliance on climatesensitive sectors such as agriculture. The US should attempt to deliver capability to assist these states to deal with the effects of climate change.

Carbon and Nitrogen Stable Isotopic Patterns in South Florida Coastal Ecosystems: Modern and Paleoceanographic Perspectives

Long term management plans for restoration of natural flow conditions through the Everglades increase the importance of understanding potential nutrient impacts of increased freshwater delivery on coastal biogeochemistry. The present study sought to increase understanding of the coastal marine system of South Florida under modern conditions and through the anthropogenic changes in the last century, on scales ranging from individual nutrient cycle processes to seasonal patterns in organic material (OM) under varying hydrodynamic regime, to century scale analysis of sedimentary records. In all applications, carbon and nitrogen stable isotopic compositions of OM were examined as natural recorders of change and nutrient cycling in the coastal system. High spatial and temporal variability in stable isotopic compositions were observed on all time scales. During a transient phytoplankton bloom, ä15N values suggested nitrogen fixation as a nutrient source supporting enhanced productivity. Seasonally, particulate organic material (POM) from ten sites along the Florida Reef Tract and in Florida Bay demonstrated variable fluctuations dependent on hydrodynamic setting. Three separate intra-annual patterns were observed, yet statistical differences were observed between groupings of Florida Bay and Atlantic Ocean sites. The POM ä15N values ranged on a quarterly basis by 7‰, while ä13C varied by 22‰. From a sediment history perspective, four cores collected from Florida Bay further demonstrated the spatial and temporal variability of the system in isotopic composition of bulk OM over time. Source inputs of OM varied with location, with terrestrial inputs dominating proximal to Everglades freshwater discharge, seagrasses dominating in open estuary cores, and a marine mixture of phytoplankton and seagrass in a core from the boundary zone between Florida Bay and the Gulf of Mexico. Significant shifts in OM geochemistry were observed coincident with anthropogenic events of the 20th century, including railroad and road construction in the Florida Keys and Everglades, and also the extensive drainage changes in Everglades hydrology. The sediment record also preserved evidence of the major hurricanes of the last century, with excursions in geochemical composition coincident with Category 4-5 storms.

Life Cycle of Deccan Trap Magma Chambers: A Crystal Scale Elemental and Strontium Isotopic Investigation

The Deccan Trap basalts are the remnants of a massive series of lava flows that erupted at the K/T boundary and covered 1-2 million km2 of west-central India. This eruptive event is of global interest because of its possible link to the major mass extinction event, and there is much debate about the duration of this massive volcanic event. In contrast to isotopic or paleomagnetic dating methods, I explore an alternative approach to determine the lifecycle of the magma chambers that supplied the lavas, and extend the concept to obtain a tighter constraint on Deccan’s duration. My method relies on extracting time information from elemental and isotopic diffusion across zone boundary in an individual crystal. I determined elemental and Sr-isotopic variations across abnormally large (2-5 cm) plagioclase crystals from the Thalghat and Kashele “Giant Plagioclase Basalts” from the lowermost Jawhar and Igatpuri Formations respectively in the thickest Western Ghats section near Mumbai. I also obtained bulk rock major, trace and rare earth element chemistry of each lava flow from the two formations. Thalghat flows contain only 12% zoned crystals, with 87Sr/86Sr ratios of 0.7096 in the core and 0.7106 in the rim, separated by a sharp boundary. In contrast, all Kashele crystals have a wider range of 87Sr/86Sr values, with multiple zones. Geochemical modeling of the data suggests that the two types of crystals grew in distinct magmatic environments. Modeling intracrystalline diffusive equilibration between the core and rim of Thalghat crystals led me to obtain a crystal growth rate of 2.03x10-10 cm/s and a residence time of 780 years for the crystals in the magma chamber(s). Employing some assumptions based on field and geochronologic evidence, I extrapolated this residence time to the entire Western Ghats and obtained an estimate of 25,000 – 35,000 years for the duration of Western Ghats volcanism. This gave an eruptive rate of 30 – 40 km3/yr, which is much higher than any presently erupting volcano. This result will remain speculative until a similarly detailed analytical-modeling study is performed for the rest of the Western Ghats formations.