Essays on the Empirical Analysis of Economic and Political Development in Sub-Saharan Africa

In Sub-Saharan Africa, non-democratic events, like civil wars and coup d'etat, destroy economic development. This study investigates both domestic and spatial effects on the likelihood of civil wars and coup d'etat. To civil wars, an increase of income growth is one of common research conclusions to stop wars. This study adds a concern on ethnic fractionalization. IV-2SLS is applied to overcome causality problem. The findings document that income growth is significant to reduce number and degree of violence in high ethnic fractionalized countries, otherwise they are trade-off. Income growth reduces amount of wars, but increases its violent level, in the countries with few large ethnic groups. Promoting growth should consider ethnic composition. This study also investigates the clustering and contagion of civil wars using spatial panel data models. Onset, incidence and end of civil conflicts spread across the network of neighboring countries while peace, the end of conflicts, diffuse only with the nearest neighbor. There is an evidence of indirect links from neighboring income growth, without too much inequality, to reduce the likelihood of civil wars. To coup d'etat, this study revisits its diffusion for both all types of coups and only successful ones. The results find an existence of both domestic and spatial determinants in different periods. Domestic income growth plays major role to reduce the likelihood of coup before cold war ends, while spatial effects do negative afterward. Results on probability to succeed coup are similar. After cold war ends, international organisations seriously promote democracy with pressure against coup d'etat, and it seems to be effective. In sum, this study indicates the role of domestic ethnic fractionalization and the spread of neighboring effects to the likelihood of non-democratic events in a country. Policy implementation should concern these factors.

Essays on credit rating agencies and the assessment of sovereign risk

Sovereign ratings have only recently regained attention in the academic debate. This seems to be somewhat surprising against the background that their influence is well-known and that rating decisions have often been criticized in the past (as for example during the Asian crisis in the 90s). Sovereign ratings do not only assess the creditworthiness of governments: They are also included in the calculation of ratings for sub-sovereign issuers whereby their rating is usually restricted to the upper bound of the sovereign rating (sovereign ceiling). Earlier studies have also shown that the downgrade of a sovereign often leads to contagion effects on neighbor countries. This study focuses first on misleading incentives in the rating industry before chapter three summarizes the literature on the influence and determinants of sovereign ratings. The fourth chapter explores empirically how ratings respond to changes in sovereign debt across specific country groups. The fifth part focuses on single rating decisions of four selected rating agencies and investigates whether the timing of decisions gives reason for herding behavior. The final chapter presents a reform proposal for the future regulation of the rating industry in light of the aforementioned flaws.rn

An Urn Model for Cascading Failures on a Lattice

A cascading failure is a failure in a system of interconnected parts, in which the breakdown of one element can lead to the subsequent collapse of the others. The aim of this paper is to introduce a simple combinatorial model for the study of cascading failures. In particular, having in mind particle systems and Markov random fields, we take into consideration a network of interacting urns displaced over a lattice. Every urn is Pólya-like and its reinforcement matrix is not only a function of time (time contagion) but also of the behavior of the neighboring urns (spatial contagion), and of a random component, which can represent either simple fate or the impact of exogenous factors. In this way a non-trivial dependence structure among the urns is built, and it is used to study default avalanches over the lattice. Thanks to its flexibility and its interesting probabilistic properties, the given construction may be used to model different phenomena characterized by cascading failures such as power grids and financial networks.

Expressing and Amplifying Positive Emotions Facilitate Goal Attainment in Workplace Interactions

Expressing emotions has social functions; it provides information, affects social interactions, and shapes relationships with others. Expressing positive emotions could be a strategic tool for improving goal attainment during social interactions at work. Such effects have been found in research on social contagion, impression management, and emotion work. However, expressing emotions one does not feel entails the risk of being perceived as inauthentic. This risk may well be worth taking when the emotions felt are negative, as expressing negative emotions usually has negative effects. When experiencing positive emotions, however, expressing them authentically promises benefits, and the advantage of amplifying them is not so obvious. We postulated that expressing, and amplifying, positive emotions would foster goal attainment in social interactions at work, particularly when dealing with superiors. Analyses are based on 494 interactions involving the pursuit of a goal by 113 employes. Multilevel analyses, including polynomial analyses, show that authentic display of positive emotions supported goal attainment throughout. However, amplifying felt positive emotions promoted goal attainment only in interactions with superiors, but not with colleagues. Results are discussed with regard to the importance of hierarchy for detecting, and interpreting, signs of strategic display of positive emotions.

Time-series analysis of Campylobacter incidence in Switzerland

SUMMARY Campylobacteriosis has been the most common food-associated notifiable infectious disease in Switzerland since 1995. Contact with and ingestion of raw or undercooked broilers are considered the dominant risk factors for infection. In this study, we investigated the temporal relationship between the disease incidence in humans and the prevalence of Campylobacter in broilers in Switzerland from 2008 to 2012. We use a time-series approach to describe the pattern of the disease by incorporating seasonal effects and autocorrelation. The analysis shows that prevalence of Campylobacter in broilers, with a 2-week lag, has a significant impact on disease incidence in humans. Therefore Campylobacter cases in humans can be partly explained by contagion through broiler meat. We also found a strong autoregressive effect in human illness, and a significant increase of illness during Christmas and New Year's holidays. In a final analysis, we corrected for the sampling error of prevalence in broilers and the results gave similar conclusions.

Strategy and Action Plan for Sustainable Land Management in the High Pamir and Pamir-Alai Mountains

This Strategy and Action Plan was written within the framework of the project on Sustainable Land Management in the High Pamir and Pamir-Alai Mountains (PALM). PALM is an integrated transboundary initiative of the governments of the Kyrgyz Republic and the Republic of Tajikistan. It aims to address the interlinked problems of land degradation and poverty within a region that is one of Central Asia’s crucial sources of freshwater and a location of biodiversity hotspots. The project is executed by the Committee on Environment Protection in Tajikistan and the National Center for Mountain Regions Development in Kyrgyzstan, with fi nancial support from the Global Environment Facility (GEF) and other donors. The United Nations Environment Programme (UNEP) is the GEF Implementing Agency for the project, and the United Nations University (UNU) is the International Executing Agency. This Strategy and Action Plan integrates the work of three main teams of experts, namely the Pamir-Alai Transboundary Strategy and Action Plan (PATSAP) team, the Legal Task Forces, and a team of Natural Disaster Risk specialists. The PATSAP team was coordinated by the Centre for Development and Environment (CDE), University of Bern, Switzerland. The Legal Task Force was led by the Australian Centre for Agriculture and Law of the University of New England (UNE), and responsibility for the Natural Disaster Risk assessment was with the Central- Asian Institute of Applied Geosciences (CAIAG) in Bishkek, Kyrgyzstan. The development of the strategy took place from June 2009 to October 2010. The activities included fi eld study tours for updating the information base with fi rst-hand information from the local level, coordination meetings with actors from the region, and two multi-level stakeholder forums conducted in Khorog and Osh to identify priorities and to collect ideas for concrete action plans. The baseline information collected for the Strategy and Action Plan has been compiled by the experts and made available as reports1. A joint multi-level stakeholder forum was conducted in Jirgitol, Tajikistan, for in-depth discussion of the transboundary aspects. In August 2010, the draft Strategy and Action Plan was distributed among local, national, and international actors for consultation, and their comments were discussed at feedback forums in Khorog and Bishkek. This Strategy and Action Plan is intended as a recommendation. Nevertheless, it proposes concrete mechanisms for implementing the proposed sustainable land management (SLM) activities: The Regional Natural Resources Governance Framework provides the legal and policy concepts, principles, and regulatory requirements needed to create an enabling environment for SLM in the High Pamir and Pamir-Alai region at the transboundary, national, and local levels. The priority directions outlined provide a framework for the elaboration of rayon-level strategies and for strategies on specifi c topics (forestry, livestock, etc.), as well as for further development of government programmes and international projects. The action plans may serve as a pool of concrete ideas, which can be taken up by diff erent institutions and in smaller or larger projects. Finally, this document provides a basis for the elaboration and signing of targeted cooperation agreements on land use and management between the leaders of Osh oblast (Kyrgyz Republic), Gorno Badakhshan Autonomous Oblast, and Jirgitol rayon (Republic of Tajikistan).

MEDICAL CARE UTILIZATION IN TIME AMONG ELDERLY MEDICARE ENROLLEES IN AN HMO

Investigation into the medical care utilization of elderly Medicare enrollees in an HMO (Kaiser - Portland, Oregon): The specific research topics are: (1) The utilization of medical care by selected determinants such as: place of service, type of service, type of appointment, physician status, physician specialty and number of associated morbidities. (2) The attended prevalence of 3 chronic diseases: hypertension, diabetes and arthritis in addition to pneumonias as an example of acute diseases. The selection of these examples was based on their importance in morbidity/or mortality results among the elderly. The share of these diseases in outpatient and inpatient contacts was examined as an example of the relation between morbidity and medical care utilization. (3) The tendency of individual utilization patterns to persist in subsequent time periods. The concept of contagion or proneness was studied in a period of 2 years. Fitting the negative binomial and the Poisson distributions was applied to the utilization in the 2nd year conditional on that in the 1st year as regards outpatient and inpatient contacts.^ The present research is based on a longitudinal study of 20% random sample of elderly Medicare enrollees. The sample size is 1683 individuals during the period from August 1980-December 1982.^ The results of the research were: (1) The distribution of contacts by selected determinants did not reveal a consistent pattern between sexes and age groups. (2) The attended prevalence of hypertension and arthritis showed excess prevalence among females. For diabetes and pneumonias no female excess was noticed. Consistent increased prevalence with increasing age was not detected.^ There were important findings pertaining to the relatively big share of the combined 3 chronic diseases in utilization. They accounted for 20% of male outpatient contacts vs. 25% of female outpatients. For inpatient contacts, they consumed 20% in case of males vs. 24% in case of females. (3) Finding that the negative binomial distribution fit the utilization experience supported the research hypothesis concerning the concept of contagion in utilization. This important finding can be helpful in estimating liability functions needed for forecasting future utilization according to previous experience. Such information has its relevance to organization, administration and planning for medical care in general. (Abstract shortened with permission of author.) ^

Communication Middleware for Distributed Hard Real-Time Systems in Java

Distributed real-time embedded systems are becoming increasingly important to society. More demands will be made on them and greater reliance will be placed on the delivery of their services. A relevant subset of them is high-integrity or hard real-time systems, where failure can cause loss of life, environmental harm, or significant financial loss. Additionally, the evolution of communication networks and paradigms as well as the necessity of demanding processing power and fault tolerance, motivated the interconnection between electronic devices; many of the communications have the possibility of transferring data at a high speed. The concept of distributed systems emerged as systems where different parts are executed on several nodes that interact with each other via a communication network. Java’s popularity, facilities and platform independence have made it an interesting language for the real-time and embedded community. This was the motivation for the development of RTSJ (Real-Time Specification for Java), which is a language extension intended to allow the development of real-time systems. The use of Java in the development of high-integrity systems requires strict development and testing techniques. However, RTJS includes a number of language features that are forbidden in such systems. In the context of the HIJA project, the HRTJ (Hard Real-Time Java) profile was developed to define a robust subset of the language that is amenable to static analysis for high-integrity system certification. Currently, a specification under the Java community process (JSR- 302) is being developed. Its purpose is to define those capabilities needed to create safety critical applications with Java technology called Safety Critical Java (SCJ). However, neither RTSJ nor its profiles provide facilities to develop distributed realtime applications. This is an important issue, as most of the current and future systems will be distributed. The Distributed RTSJ (DRTSJ) Expert Group was created under the Java community process (JSR-50) in order to define appropriate abstractions to overcome this problem. Currently there is no formal specification. The aim of this thesis is to develop a communication middleware that is suitable for the development of distributed hard real-time systems in Java, based on the integration between the RMI (Remote Method Invocation) model and the HRTJ profile. It has been designed and implemented keeping in mind the main requirements such as the predictability and reliability in the timing behavior and the resource usage. iThe design starts with the definition of a computational model which identifies among other things: the communication model, most appropriate underlying network protocols, the analysis model, and a subset of Java for hard real-time systems. In the design, the remote references are the basic means for building distributed applications which are associated with all non-functional parameters and resources needed to implement synchronous or asynchronous remote invocations with real-time attributes. The proposed middleware separates the resource allocation from the execution itself by defining two phases and a specific threading mechanism that guarantees a suitable timing behavior. It also includes mechanisms to monitor the functional and the timing behavior. It provides independence from network protocol defining a network interface and modules. The JRMP protocol was modified to include two phases, non-functional parameters, and message size optimizations. Although serialization is one of the fundamental operations to ensure proper data transmission, current implementations are not suitable for hard real-time systems and there are no alternatives. This thesis proposes a predictable serialization that introduces a new compiler to generate optimized code according to the computational model. The proposed solution has the advantage of allowing us to schedule the communications and to adjust the memory usage at compilation time. In order to validate the design and the implementation a demanding validation process was carried out with emphasis in the functional behavior, the memory usage, the processor usage (the end-to-end response time and the response time in each functional block) and the network usage (real consumption according to the calculated consumption). The results obtained in an industrial application developed by Thales Avionics (a Flight Management System) and in exhaustive tests show that the design and the prototype are reliable for industrial applications with strict timing requirements. Los sistemas empotrados y distribuidos de tiempo real son cada vez más importantes para la sociedad. Su demanda aumenta y cada vez más dependemos de los servicios que proporcionan. Los sistemas de alta integridad constituyen un subconjunto de gran importancia. Se caracterizan por que un fallo en su funcionamiento puede causar pérdida de vidas humanas, daños en el medio ambiente o cuantiosas pérdidas económicas. La necesidad de satisfacer requisitos temporales estrictos, hace más complejo su desarrollo. Mientras que los sistemas empotrados se sigan expandiendo en nuestra sociedad, es necesario garantizar un coste de desarrollo ajustado mediante el uso técnicas adecuadas en su diseño, mantenimiento y certificación. En concreto, se requiere una tecnología flexible e independiente del hardware. La evolución de las redes y paradigmas de comunicación, así como la necesidad de mayor potencia de cómputo y de tolerancia a fallos, ha motivado la interconexión de dispositivos electrónicos. Los mecanismos de comunicación permiten la transferencia de datos con alta velocidad de transmisión. En este contexto, el concepto de sistema distribuido ha emergido como sistemas donde sus componentes se ejecutan en varios nodos en paralelo y que interactúan entre ellos mediante redes de comunicaciones. Un concepto interesante son los sistemas de tiempo real neutrales respecto a la plataforma de ejecución. Se caracterizan por la falta de conocimiento de esta plataforma durante su diseño. Esta propiedad es relevante, por que conviene que se ejecuten en la mayor variedad de arquitecturas, tienen una vida media mayor de diez anos y el lugar ˜ donde se ejecutan puede variar. El lenguaje de programación Java es una buena base para el desarrollo de este tipo de sistemas. Por este motivo se ha creado RTSJ (Real-Time Specification for Java), que es una extensión del lenguaje para permitir el desarrollo de sistemas de tiempo real. Sin embargo, RTSJ no proporciona facilidades para el desarrollo de aplicaciones distribuidas de tiempo real. Es una limitación importante dado que la mayoría de los actuales y futuros sistemas serán distribuidos. El grupo DRTSJ (DistributedRTSJ) fue creado bajo el proceso de la comunidad de Java (JSR-50) con el fin de definir las abstracciones que aborden dicha limitación, pero en la actualidad aun no existe una especificacion formal. El objetivo de esta tesis es desarrollar un middleware de comunicaciones para el desarrollo de sistemas distribuidos de tiempo real en Java, basado en la integración entre el modelo de RMI (Remote Method Invocation) y el perfil HRTJ. Ha sido diseñado e implementado teniendo en cuenta los requisitos principales, como la predecibilidad y la confiabilidad del comportamiento temporal y el uso de recursos. El diseño parte de la definición de un modelo computacional el cual identifica entre otras cosas: el modelo de comunicaciones, los protocolos de red subyacentes más adecuados, el modelo de análisis, y un subconjunto de Java para sistemas de tiempo real crítico. En el diseño, las referencias remotas son el medio básico para construcción de aplicaciones distribuidas las cuales son asociadas a todos los parámetros no funcionales y los recursos necesarios para la ejecución de invocaciones remotas síncronas o asíncronas con atributos de tiempo real. El middleware propuesto separa la asignación de recursos de la propia ejecución definiendo dos fases y un mecanismo de hebras especifico que garantiza un comportamiento temporal adecuado. Además se ha incluido mecanismos para supervisar el comportamiento funcional y temporal. Se ha buscado independencia del protocolo de red definiendo una interfaz de red y módulos específicos. También se ha modificado el protocolo JRMP para incluir diferentes fases, parámetros no funcionales y optimizaciones de los tamaños de los mensajes. Aunque la serialización es una de las operaciones fundamentales para asegurar la adecuada transmisión de datos, las actuales implementaciones no son adecuadas para sistemas críticos y no hay alternativas. Este trabajo propone una serialización predecible que ha implicado el desarrollo de un nuevo compilador para la generación de código optimizado acorde al modelo computacional. La solución propuesta tiene la ventaja que en tiempo de compilación nos permite planificar las comunicaciones y ajustar el uso de memoria. Con el objetivo de validar el diseño e implementación se ha llevado a cabo un exigente proceso de validación con énfasis en: el comportamiento funcional, el uso de memoria, el uso del procesador (tiempo de respuesta de extremo a extremo y en cada uno de los bloques funcionales) y el uso de la red (consumo real conforme al estimado). Los buenos resultados obtenidos en una aplicación industrial desarrollada por Thales Avionics (un sistema de gestión de vuelo) y en las pruebas exhaustivas han demostrado que el diseño y el prototipo son fiables para aplicaciones industriales con estrictos requisitos temporales.

FPGA Acceleration of Monte Carlo-based Financial Simulation: Design Challenges and Lessons Learnt

The simulation of interest rate derivatives is a powerful tool to face the current market fluctuations. However, the complexity of the financial models and the way they are processed require exorbitant computation times, what is in clear conflict with the need of a processing time as short as possible to operate in the financial market. To shorten the computation time of financial derivatives the use of hardware accelerators becomes a must.

Granger causality and systemic risk

Building on the concept of Granger causality in risk in Hong et al. (2009), and focusing on an international sample of large-capitalization banks, we test for predictability in comovements in the left tails of returns of individual banks and the global system. The main results show that large individual shocks (defined as balance-sheet contractions exceeding the 1% VaR level) are a strong predictor of subsequent shocks in the global system. This evidence is particularly strong for US banks with large desks of proprietary trading. Similarly, we document strong evidence of financial vulnerabilities (exposures) to systemic shocks in US subprime creditors.

Letters from Benjamin Welles to John Henry Tudor, 1799-1801

Benjamin Welles wrote these six letters to his friend and classmate, John Henry Tudor, between 1799 and 1801. Four of the letters are dated, and the dates of the other two can be deduced from their contents. Welles wrote Tudor four times in September 1799, at the onset of their senior year at Harvard, in an attempt to clear up hurt feelings and false rumors that he believed had caused a chill in their friendship. The cause of the rift is never fully explained, though Welles alludes to "a viper" and "villainous hypocrite" who apparently spread rumors and fueled discord between the two friends. In one letter, Welles asserts that "College is a rascal's Elysium - or the feeling man's hell." In another he writes: "College, Tudor, is a furnace to the phlegmatic, & a Greenland to thee feeling man; it has an atmosphere which breathes contagion to the soul [...] Villains fatten here. College is the embryo of hell." Whatever their discord, the wounds were apparently eventually healed; in a letter written June 26, 1800, Welles writes to ask Tudor about his impending speech at Commencement exercises. In an October 29, 1801 letter, Welles writes to Tudor in Philadelphia (where he appears to have traveled in attempts to recover his failing health) and expresses strong wishes for his friend's recovery and return to Boston. This letter also contains news of their classmate Washington Allston's meeting with painters Henry Fuseli and Benjamin West.

ECB Policy and Eurozone Fragility: Was De Grauwe Right? CEPS Working Document No. 397, June 2014

Paul De Grauwe’s fragility hypothesis states that member countries of a monetary union such as the eurozone are highly vulnerable to a self-fulfilling mechanism by which the efforts of investors to avoid losses from default can end up triggering the very default they fear. The authors test this hypothesis by applying an eclectic methodology to a time window around Mario Draghi’s “whatever it takes” (to keep the eurozone on firm footing) pledge on 26 July 2012. This pledge was soon followed by the announcement of the Outright Monetary Transactions (OMT) programme (the prospective and conditional purchase by the European Central Bank of sovereign bonds of eurozone countries having difficulty issuing debt). The principal components of eurozone credit default swap spreads validate this choice of time frame. An event study reveals significant pre announcement contagion emanating from Spain to Italy, Belgium, France and Austria. Furthermore, time-series regression confirms frequent clusters of large shocks affecting the credit default swap spreads of the four eurozone countries but solely during the pre-announcement period. The findings of this report support the fragility hypothesis for the eurozone and endorse the Outright Monetary Transactions programme.

The Impact of Banking Structural Reform on Household Retail Finance. ECRI Commentary No. 13, 7 October 2014

There are two main objectives behind the EC proposal on banking structural reform: the financial stability objective and the economic efficiency objective. If it is implemented, the reform should reinforce the stability and economic efficiency of household retail activities through lower contagion, better resolvability in the event of failure, more harmonised supervisory practices across the EU and more resilient household demand for retail loans. However, it could also trigger counterproductive effects that could partly undermine the expected benefits. These potential negative effects are not appropriately assessed in the impact study of the proposal published in January 2014 and will require further consideration in the coming months. In particular, the stability of household retail finance could be strengthened by placing more emphasis on bankruptcy risks of retail banks; the transfer of existing systemic activities towards less regulated and supervised markets and reputational risk. A better analysis of the borrowing costs for households (impacted by the potential decreasing diversification of the funding base of banks and scarcer liquidity) and implementation costs could help regulators to achieve the objective of efficient household activities.

The Financial Crisis and the Future of the Eurozone. Bruges European Economic Policy (BEEP) Briefing 21/2010

The government debt crisis, erupted in the Eurozone in 2009, nearly led to the collapse of European monetary union. Now that this has been averted, the question is what should be done to make the Eurozone sustainable in the long run. The survival of the Eurozone hinges on the capacity of its leaders to improve the eurozone's governance. With the exception of Greece, the root cause of the government debt crisis has little to do with the poor performance of the SGP, rather, with unsustainable debt accumulation by private actors. Also, the method of convergence implicit in the SGP has not worked well – macroeconomic divergences have stubbornly remained for nearly a decade and several countries experienced boom and bust dynamics. Although strong declines in real interest rates may explain part of the story (but e.g. Italy did not experience boom & bust), self-fulfilling waves of optimism and pessimism which might be called 'animal spirits' and are of mainly national origin, seem a good candidate for explanation. These national animal spirits endogenously trigger credit expansion and contraction. It follows that (national) movements of credit ought to be under much firmer control and this is up to the monetary authorities, including the ECB. Critical recommendations for better governance of the Eurozone should therefore combine credible measures to maintain fiscal discipline over the medium term with such instruments as minimum reserve requirements to control the growth of bank credit as well as minimum reserve requirements in different national banking systems. Finally, the idea of adding more sanctions to the SGP may be ill-conceived since, in future, it might pre-empt national governments to come to the rescue of banks (under credible threats of contagion) and/or prevent a downward spiral in economic activity.