Business Cycles, Unemployment Insurance, and the Calibration of Matching Models

This paper points out an empirical puzzle that arises when an RBC economy with a job matching function is used to model unemployment. The standard model can generate sufficiently large cyclical fluctuations in unemployment, or a sufficiently small response of unemployment to labor market policies, but it cannot do both. Variable search and separation, finite UI benefit duration, efficiency wages, and capital all fail to resolve this puzzle. However, both sticky wages and match-specific productivity shocks help the model reproduce the stylized facts: both make the firm's flow of surplus more procyclical, thus making hiring more procyclical too.

Acute effects of transmyocardial laser revascularization on left-ventricular function: an haemodynamic and echocardiographic study.

While the lesions produced by transmyocardial laser revascularisation (TMLR) induce scar formation, it is important to determine whether this procedure can be deleterious for the left-ventricular function, which is already impaired by the underlying ischaemic process in some patients. Ten channels were drilled in the left lateral wall of the hearts of ten pigs (mean weight, 61 +/- 8.2kg) with a Holmium:YAG laser. Haemodynamic measurements and echocardiographic assessment of left-ventricular function were performed before the TMLR procedure, 5 and 30 min after, and lastly after 5 min of pacing at a rate increased by 30% of the baseline value. Echocardiographic assessment was in the short axis at the level of the laser channels, and included left-ventricular ejection fraction and segmental wall motility of the lasered area (scale 0-3:0 = normal 1 = hypokinesia, 2 = akinesia, 3 = dyskinesia). Values at 5 and 30 min were compared with baseline values; the difference was considered significant if p < 0.05. Haemodynamical values were stable throughout all the procedures. The ejection fraction showed a slight but significant decrease 5 min after the creation of the channels (60.4 +/- 6.8% vs 54 +/- 7.6%, p=0.02) and recovered at 30min. The segmental motility score of the involved areas increased to 1 after 5 min in five animals, and came back to 0 at 30 min except in one animal. Even with pacing no segmental dysfunction occurred. The reversibility of the segmental hypokinesia induced by TMLR, as well as the absence of pace-induced dysfunction 30 min after the procedure strongly suggest the inocuity of TMLR in this experimental set-up.

Two-sided learning in New Keynesian models: Dynamics, (lack of) convergence and the value of information

This paper investigates the role of learning by private agents and the central bank(two-sided learning) in a New Keynesian framework in which both sides of the economyhave asymmetric and imperfect knowledge about the true data generating process. Weassume that all agents employ the data that they observe (which may be distinct fordifferent sets of agents) to form beliefs about unknown aspects of the true model ofthe economy, use their beliefs to decide on actions, and revise these beliefs througha statistical learning algorithm as new information becomes available. We study theshort-run dynamics of our model and derive its policy recommendations, particularlywith respect to central bank communications. We demonstrate that two-sided learningcan generate substantial increases in volatility and persistence, and alter the behaviorof the variables in the model in a significant way. Our simulations do not convergeto a symmetric rational expectations equilibrium and we highlight one source thatinvalidates the convergence results of Marcet and Sargent (1989). Finally, we identifya novel aspect of central bank communication in models of learning: communicationcan be harmful if the central bank's model is substantially mis-specified.

Back to square one: Identification issues in DSGE models

We investigate identifiability issues in DSGE models and their consequences for parameter estimation and model evaluation when the objective function measures the distance between estimated and model impulse responses. We show that observational equivalence, partial and weak identification problems are widespread, that they lead to biased estimates, unreliable t-statistics and may induce investigators to select false models. We examine whether different objective functions affect identification and study how small samples interact with parameters and shock identification. We provide diagnostics and tests to detect identification failures and apply them to a state-of-the-art model.

Melatonin improves glucose homeostasis and endothelial vascular function in high-fat diet-fed insulin-resistant mice.

Obesity and insulin resistance represent a problem of utmost clinical significance worldwide. Insulin-resistant states are characterized by the inability of insulin to induce proper signal transduction leading to defective glucose uptake in skeletal muscle tissue and impaired insulin-induced vasodilation. In various pathophysiological models, melatonin interacts with crucial molecules of the insulin signaling pathway, but its effects on glucose homeostasis are not known. In a diet-induced mouse model of insulin resistance and normal chow-fed control mice, we sought to assess the effects of an 8-wk oral treatment with melatonin on insulin and glucose tolerance and to understand underlying mechanisms. In high-fat diet-fed mice, but not in normal chow-fed control mice, melatonin significantly improved insulin sensitivity and glucose tolerance, as evidenced by a higher rate of glucose infusion to maintain euglycemia during hyperinsulinemic clamp studies and an attenuated hyperglycemic response to an ip glucose challenge. Regarding underlying mechanisms, we found that melatonin restored insulin-induced vasodilation to skeletal muscle, a major site of glucose utilization. This was due, at least in part, to the improvement of insulin signal transduction in the vasculature, as evidenced by increased insulin-induced phosphorylation of Akt and endoethelial nitric oxide synthase in aortas harvested from melatonin-treated high-fat diet-fed mice. In contrast, melatonin had no effect on the ability of insulin to promote glucose uptake in skeletal muscle tissue in vitro. These data demonstrate for the first time that in a diet-induced rodent model of insulin resistance, melatonin improves glucose homeostasis by restoring the vascular action of insulin.

On the relevance of modeling volatility for pricing purposes

This paper presents a two-factor (Vasicek-CIR) model of the term structure of interest rates and develops its pricing and empirical properties. We assume that default free discount bond prices are determined by the time to maturity and two factors, the long-term interest rate and the spread. Assuming a certain process for both factors, a general bond pricing equation is derived and a closed-form expression for bond prices is obtained. Empirical evidence of the model's performance in comparisson with a double Vasicek model is presented. The main conclusion is that the modeling of the volatility in the long-term rate process can help (in a large amount) to fit the observed data can improve - in a reasonable quantity - the prediction of the future movements in the medium- and long-term interest rates. However, for shorter maturities, it is shown that the pricing errors are, basically, negligible and it is not so clear which is the best model to be used.

Business cycles, unemployment insurance and the calibration of matching models

This paper theoretically and empirically documents a puzzle that arises when an RBC economy with a job matching function is used to model unemployment. The standard model can generate sufficiently large cyclical fluctuations in unemployment, or a sufficiently small response of unemployment to labor market policies, but it cannot do both. Variable search and separation, finite UI benefit duration, efficiency wages, and capital all fail to resolve this puzzle. However, either sticky wages or match-specific productivity shocks can improve the model's performance by making the firm's flow of surplus more procyclical, which makes hiring more procyclical too.

Cost efficiency in primary care contracting: A stochastic frontier cost function approach

The principal aim of this paper is to estimate a stochastic frontier costfunction and an inefficiency effects model in the analysis of the primaryhealth care services purchased by the public authority and supplied by 180providers in 1996 in Catalonia. The evidence from our sample does not supportthe premise that contracting out has helped improve purchasing costefficiency in primary care. Inefficient purchasing cost was observed in thecomponent of this purchasing cost explicitly included in the contract betweenpurchaser and provider. There are no observable incentives for thecontracted-out primary health care teams to minimise prescription costs, whichare not explicitly included in the present contracting system.

Abnormal Lung Function and Risk for Heart Failure in the Elderly: The Health, Aging, and Body Composition Study

Background: Chronic obstructive pulmonary disease (COPD) has been associated with increased risk for heart failure (HF). The impact of subclinical abnormal spirometric findings on HF risk among older adults without history of COPD is not well elucidated. Methods: We evaluated 2125 participants (age 73.6±2.9 years; 50.5% men; 62.3% white; 45.6/9.4% past/current smokers; body mass index [BMI] 27.2±4.6 kg/m2) without prevalent COPD or HF who underwent baseline spirometry in the Health ABC Study. Abnormal lung function was defined either as forced vital capacity (FVC) below lower limit of normal (LLN) or forced expiratory volume in 1st sec (FEV1) to FVC ratio below LLN. Results: On follow-up (median, 9.4 years), 68 of 350 (19.4%) participants with abnormal lung function developed HF, as compared to 172 of 1775 (9.7%) participants with normal lung function (hazard ratio [HR], 2.31; 95% confidence interval [CI], 1.74 -3.06; P<.001). This increased risk persisted after adjusting for all other independent predictors of HF in the Health ABC Study, BMI, incident coronary events, and several inflammatory markers (HR, 1.82; 95% CI, 1.30 -2.54; P<.001), and remained constant over time. Baseline FVC and FEV1 had a linear association with HF risk (Figure). In adjusted models, HF risk increased by 21% (95% CI, 10 -36%) per 10% decrease in FVC and 18% (95% CI, 10 -28%) per 10% decrease in FEV1 (both P<.001); this association persisted among participants with normal lung function at baseline. Findings were consistent across sex, race, and smoking status. Conclusions: Subclinical abnormal spirometric findings are prevalent among older adults and are independently associated with risk for incident HF.

Identification of an agrin mutation that causes congenital myasthenia and affects synapse function.

We report the case of a congenital myasthenic syndrome due to a mutation in AGRN, the gene encoding agrin, an extracellular matrix molecule released by the nerve and critical for formation of the neuromuscular junction. Gene analysis identified a homozygous missense mutation, c.5125G>C, leading to the p.Gly1709Arg variant. The muscle-biopsy specimen showed a major disorganization of the neuromuscular junction, including changes in the nerve-terminal cytoskeleton and fragmentation of the synaptic gutters. Experiments performed in nonmuscle cells or in cultured C2C12 myotubes and using recombinant mini-agrin for the mutated and the wild-type forms showed that the mutated form did not impair the activation of MuSK or change the total number of induced acetylcholine receptor aggregates. A solid-phase assay using the dystrophin glycoprotein complex showed that the mutation did not affect the binding of agrin to alpha-dystroglycan. Injection of wild-type or mutated agrin into rat soleus muscle induced the formation of nonsynaptic acetylcholine receptor clusters, but the mutant protein specifically destabilized the endogenous neuromuscular junctions. Importantly, the changes observed in rat muscle injected with mutant agrin recapitulated the pre- and post-synaptic modifications observed in the patient. These results indicate that the mutation does not interfere with the ability of agrin to induce postsynaptic structures but that it dramatically perturbs the maintenance of the neuromuscular junction.

Regulation of endothelial cell integrin function and angiogenesis by COX-2, cAMP and Protein Kinase A.

Angiogenesis, the development of new blood vessels from preexisting vessels, is a key step in tumor growth, invasion and metastasis formation. Inhibition of tumor angiogenesis is considered as an attractive approach to suppress cancer progression and spreading. Adhesion receptors of the integrin family promote tumor angiogenesis by mediating cell migration, proliferation and survival of angiogenic endothelial cells. Integrins up regulated and highly expressed on neovascular endothelial cells, such as alphaVbeta3 and alpha5beta1, have been considered as relevant targets for anti-angiogenic therapies. Small molecular integrin antagonists or blocking antibodies suppress angiogenesis and tumor progression in many animal models, and some of them are currently being tested in cancer clinical trials as anti-angiogenic agents. COX-2 inhibitors exert anti-cancer effects, at least in part, by inhibiting tumor angiogenesis. We have recently shown that COX-2 inhibitors suppress endothelial cell migration and angiogenesis by preventing alphaVbeta3-mediated and cAMP/PKA-dependent activation of the small GTPases Rac and Cdc42. Here we will review the evidence for the involvement of vascular integrins in mediating angiogenesis and the role of COX-2 metabolites in modulating the cAMP/Protein Kinase A pathway and alphaVbeta3-dependent Rac activation in endothelial cells.

A note on the Malliavin differentiability of the Heston volatility

We show that the Heston volatility or equivalently the Cox-Ingersoll-Ross process is Malliavin differentiable and give an explicit expression for the derivative. This result assures the applicability of Malliavin calculus in the framework of the Heston stochastic volatility model and the Cox-Ingersoll-Ross model for interest rates.

Structure-function characterization and optimization of a plant-derived antibacterial peptide.

Crushed seeds of the Moringa oleifera tree have been used traditionally as natural flocculants to clarify drinking water. We previously showed that one of the seed peptides mediates both the sedimentation of suspended particles such as bacterial cells and a direct bactericidal activity, raising the possibility that the two activities might be related. In this study, the conformational modeling of the peptide was coupled to a functional analysis of synthetic derivatives. This indicated that partly overlapping structural determinants mediate the sedimentation and antibacterial activities. Sedimentation requires a positively charged, glutamine-rich portion of the peptide that aggregates bacterial cells. The bactericidal activity was localized to a sequence prone to form a helix-loop-helix structural motif. Amino acid substitution showed that the bactericidal activity requires hydrophobic proline residues within the protruding loop. Vital dye staining indicated that treatment with peptides containing this motif results in bacterial membrane damage. Assembly of multiple copies of this structural motif into a branched peptide enhanced antibacterial activity, since low concentrations effectively kill bacteria such as Pseudomonas aeruginosa and Streptococcus pyogenes without displaying a toxic effect on human red blood cells. This study thus identifies a synthetic peptide with potent antibacterial activity against specific human pathogens. It also suggests partly distinct molecular mechanisms for each activity. Sedimentation may result from coupled flocculation and coagulation effects, while the bactericidal activity would require bacterial membrane destabilization by a hydrophobic loop.

Homeostasis and in vivo effector function of antigen-specific CD4+CD25+ regulatory T cells in experimental transplantation.

CD4+CD25+ regulatory T cells (Tregs) play a critical role in the prevention of autoimmune diseases as well as in the induction and maintenance of dominant tolerance in transplantation models. While their suppressive function has been extensively studied in vitro, their homeostasis and mechanisms of immunoregulation still remain to be clarifi ed in vivo. Using a murine adoptive transfer and skin allograft model, we analysed the expansion, effector function and traffi cking of effector T cells in the presence or absence of donor-specifi c Tregs. Although hyporesponsive to allogeneic and polyclonal stimulation in vitro, transferred Tregs survived and expanded, in response to an allograft in vivo. When co-transferred with naive CD4+CD25- effector T cells, they specifi cally prevented donor but not 3rd party allograft rejection by inhibiting the production of effector cytokines rather than the proliferation of effector T cells in response to alloantigens. The co-transfer of donor-specifi c Tregs did not affect the homing of effector T cells towards the graft draining lymph nodes, but it markedly reduced the infi ltration of the allograft by these pathogenic cells. Furthermore, in recipients where donor-specifi c transplantation tolerance was induced, Tregs preferentially accumulated in the allograft draining lymph nodes and within the grafted skin itself. Taken together, our results suggest that the suppression of graft rejection is an active process that involves the persistent presence of Tregs at the site of antigenic challenge.

BAFF, APRIL and their receptors: structure, function and signaling.

BAFF, APRIL and their receptors play important immunological roles, especially in the B cell arm of the immune system. A number of splice isoforms have been described for both ligands and receptors in this subfamily, some of which are conserved between mouse and human, while others are species-specific. Structural and mutational analyses have revealed key determinants of receptor-ligand specificity. BAFF-R has a strong selectivity for BAFF; BCMA has a higher affinity for APRIL than for BAFF, while TACI binds both ligands equally well. The molecular signaling events downstream of BAFF-R, BCMA and TACI are still incompletely characterized. Survival appears to be mediated by upregulation of Bcl-2 family members through NF-kappaB activation, degradation of the pro-apototic Bim protein, and control of subcellular localization of PCKdelta. Very little is known about other signaling events associated with receptor engagement by BAFF and APRIL that lead for example to B cell activation or to CD40L-independent Ig switch.