Competing engines of growth: Innovation and standardization

We study a dynamic general equilibrium model where innovation takes theform of the introduction of new goods whose production requires skilled workers.Innovation is followed by a costly process of standardization, whereby these newgoods are adapted to be produced using unskilled labor. Our framework highlightsa number of novel results. First, standardization is both an engine of growth anda potential barrier to it. As a result, growth is an inverse U-shaped function ofthe standardization rate (and of competition). Second, we characterize the growthand welfare maximizing speed of standardization. We show how optimal protection of intellectual property rights affecting the cost of standardization vary withthe skill-endowment, the elasticity of substitution between goods and other parameters. Third, we show that, depending on how competition between innovatingand standardizing firms is modelled and on parameter values, a new type of multiplicity of equilibria may arise. Finally, we study the implications of our model forthe skill-premium and we illustrate novel reasons for linking North-South trade tointellectual property rights protection.

Regional allocation of skills

This paper addresses three questions: (1) why does the share of skilledworkers in regional population tend to be higher in wealthier regions? (2)what determines changes in this share over time? and (3) why is it that internalmigration tends to raise average skill levels of the receiving regions relativeto that of the sending regions? I construct a two--region dynamic model withagglomeration and congestion to answer these questions. It is shown that,under certain relationship between wages and demand for land, unskilledworkers are discouraged more strongly from living in a wealthier region andare less mobile than skilled workers.

The optimum quantity of money: Theory and evidence

In this paper we propose a simple and general model for computing the Ramsey optimal inflation tax, which includes several models from the previous literature as special cases. We show that it cannot be claimed that the Friedman rule is always optimal (or always non--optimal) on theoretical grounds. The Friedman rule is optimal or not, depending on conditions related to the shape of various relevant functions. One contribution of this paper is to relate these conditions to {\it measurable} variables such as the interest rate or the consumption elasticity of money demand. We find that it tends to be optimal to tax money when there are economies of scale in the demand for money (the scale elasticity is smaller than one) and/or when money is required for the payment of consumption or wage taxes. We find that it tends to be optimal to tax money more heavily when the interest elasticity of money demand is small. We present empirical evidence on the parameters that determine the optimal inflation tax. Calibrating the model to a variety of empirical studies yields a optimal nominal interest rate of less than 1\%/year, although that finding is sensitive to the calibration.

Optimal regulation of a fully insured deposit banking system

We analyze risk sensitive incentive compatible deposit insurancein the presence of private information when the market value of depositinsurance can be determined using Merton's (1997) formula. We show that,under the assumption that transferring funds from taxpayers to financialinstitutions has a social cost, the optimal regulation combines differentlevels of capital requirements combined with decreasing premia on depositinsurance. On the other hand, it is never efficient to require the banksto hold riskless assets, so that narrow banking is not efficient. Finally,chartering banks is necessary in order to decrease the cost of asymmetricinformation.

The optimal length of contracts with application to outsourcing

This paper resolves three empirical puzzles in outsourcing by formalizing the adaptationcost of long-term performance contracts. Side-trading with a new partner alongside a long-term contract (to exploit an adaptation-requiring investment) is usually less effective than switching to the new partner when the contract expires. So long-term contracts that prevent holdup of specific investments may induce holdup of adaptation investments. Contract length therefore trades of specific and adaptation investments. Length should increase with the importance and specificity of self-investments, and decrease with the importance of adaptation investments for which side-trading is ineffective. My general model also shows how optimal length falls with cross-investments and wasteful investments.

Optimal bail out policy, conditionality and constructive ambiguity

This paper addresses the issue of the optimal behaviour of the Lender of Last Resort (LOLR) in its microeconomic role regarding individual financial institutions in distress. It has been argued that the LOLR should not intervene at the microeconomic level and let any defaulting institution face the market discipline, as it will be confronted with the consequences of the risks it has taken. By considering a simple costbenefit analysis we show that this position may lack a sufficient foundation. We establish that, instead, uder reasonable assumptions, the optimal policy has to be conditional on the amount of uninsured debt issued by the defaulting bank. Yet in equilibrium, because the rescue policy is costly, the LOLR will not rescue all the banks that fulfill the uninsured debt requirement condition, but will follow a mixed strategy. This we interpret as the confirmation of the "creative ambiguity" principle, perfectly in line with the central bankers claim that it is efficient for them to have discretion in lending to individual institutions. Alternatively, in other cases, when the social cost of a bank's bankruptcy is too high, it is optimal for the LOLR to bail out the insititution, and this gives support to the "too big to fail" policy.

Sustainability of the Peruvian anchoveta supply chains from sea to shelf: towards a new strategy for optimal use of resources

The research performed a sustainability assessment of supply chains of the anchoveta (Engraulis ringens) in Peru. The corresponding fisheries lands 6.5 million t per year, of which <2% is rendered into products for direct human consumption (DHC) and 98% reduced into feed ingredients (fishmeal and fish oil, FMFO), for export. Several industries compete for the anchoveta resources, generating local and global impacts. The need for understanding these dynamics, towards sustainability-improving management and policy recommendations, determined the development of a sustainability assessment framework: 1) characterisation and modelling of the systems under study (with Life Cycle Assessment and other tools) including local aquaculture, 2) calculation of sustainability indicators (i.e. energy efficiency, nutritional value, socio-economic performances), and 3) sustainability comparison of supply chains; definition and comparison of alternative exploitation scenarios. Future exploitation scenarios were defined by combining an ecosystem and a material flow models: continuation of the status quo (Scenario 1), shift towards increased proportion of DHC production (Scenario 2), and radical reduction of the anchoveta harvest in order for other fish stocks to recover and be exploited for DHC (Scenario 3). Scenario 2 was identified as the most sustainable. Management and policy recommendations include improving of: controls for compliance with management measures, sanitary conditions for DHC, landing infrastructure for small- and medium-scale (SMS) fisheries; the development of a national refrigerated distribution chain; and the assignation of flexible tolerances for discards from different DHC processes.

Design of new promoters and of a dual-bioreporter based on cross-activation by the two regulatory proteins XylR and HbpR.

The HbpR protein is the sigma54-dependent transcription activator for 2-hydroxybiphenyl degradation in Pseudomonas azelaica. The ability of HbpR and XylR, which share 35% amino acid sequence identity, to cross-activate the PhbpC and Pu promoters was investigated by determining HbpR- or XylR-mediated luciferase expression and by DNA binding assays. XylR measurably activated the PhbpC promoter in the presence of the effector m-xylene, both in Escherichia coli and Pseudomonas putida. HbpR weakly stimulated the Pu promoter in E. coli but not in P. azelaica. Poor HbpR-dependent activation from Pu was caused by a weak binding to the operator region. To create promoters efficiently activated by both regulators, the HbpR binding sites on PhbpC were gradually changed into the XylR binding sites of Pu by site-directed mutagenesis. Inducible luciferase expression from mutated promoters was tested in E. coli on a two plasmid system, and from mono copy gene fusions in P. azelaica and P. putida. Some mutants were efficiently activated by both HbpR and XylR, showing that promoters can be created which are permissive for both regulators. Others achieved a higher XylR-dependent transcription than from Pu itself. Mutants were also obtained which displayed a tenfold lower uninduced expression level by HbpR than the wild-type PhbpC, while keeping the same maximal induction level. On the basis of these results, a dual-responsive bioreporter strain of P. azelaica was created, containing both XylR and HbpR, and activating luciferase expression from the same single promoter independently with m-xylene and 2-hydroxybiphenyl.

Multifactorial ERβ and NOTCH1 control of squamous differentiation and cancer.

Downmodulation or loss-of-function mutations of the gene encoding NOTCH1 are associated with dysfunctional squamous cell differentiation and development of squamous cell carcinoma (SCC) in skin and internal organs. While NOTCH1 receptor activation has been well characterized, little is known about how NOTCH1 gene transcription is regulated. Using bioinformatics and functional screening approaches, we identified several regulators of the NOTCH1 gene in keratinocytes, with the transcription factors DLX5 and EGR3 and estrogen receptor β (ERβ) directly controlling its expression in differentiation. DLX5 and ERG3 are required for RNA polymerase II (PolII) recruitment to the NOTCH1 locus, while ERβ controls NOTCH1 transcription through RNA PolII pause release. Expression of several identified NOTCH1 regulators, including ERβ, is frequently compromised in skin, head and neck, and lung SCCs and SCC-derived cell lines. Furthermore, a keratinocyte ERβ-dependent program of gene expression is subverted in SCCs from various body sites, and there are consistent differences in mutation and gene-expression signatures of head and neck and lung SCCs in female versus male patients. Experimentally increased ERβ expression or treatment with ERβ agonists inhibited proliferation of SCC cells and promoted NOTCH1 expression and squamous differentiation both in vitro and in mouse xenotransplants. Our data identify a link between transcriptional control of NOTCH1 expression and the estrogen response in keratinocytes, with implications for differentiation therapy of squamous cancer.

High sensitivity of immature GABAergic neurons to blockers of voltage-gated calcium channels.

The involvement of voltage-gated calcium channels in the survival of immature CNS neurons was studied in aggregating brain cell cultures by examining cell type-specific effects of various channel blockers. Nifedipine (10 microM), a specific blocker of L-type calcium channels, caused a pronounced and irreversible decrease of glutamic acid decarboxylase activity, whereas the activity of choline acetyltransferase was significantly less affected. Flunarizine (1-10 microM, a relatively unspecific ion channel blocker) elicited similar effects, that were attenuated by NMDA. The glia-specific marker enzymes, glutamine synthetase and 2',3'-cyclic nucleotide 3'-phosphohydrolase, were affected only after treatment with high concentrations of nifedipine (50 microM) or NiCl2 (100 microM, shown to block T-type calcium channels). Nifedipine (50 microM), NiCl2 (100 microM), and flunarizine (5 microM) also caused a significant increase in the soluble nucleosome concentration, indicating increased apoptotic cell death. This effect was prevented by cycloheximide (1 microM). Furthermore, the combined treatment with calcicludine (10 nM, blocking L-type calcium channels) and funnel-web spider toxin-3.3 (100 nM, blocking T-type channels) also caused a significant increase in free nucleosomes as well as a decrease in glutamic acid decarboxylase activity. In contrast, cell viability was not affected by peptide blockers specific for N-, P-, and/or Q-type calcium channels. Highly differentiated cultures showed diminished susceptibility to nifedipine and flunarizine. The present data suggest that the survival of immature neurons, and particularly that of immature GABAergic neurons, requires the sustained entry of Ca2+ through voltage-gated calcium channels.

Optimal management of microgrids

Desenvolupament dels models matemàtics necessaris per a controlar de forma òptima la microxarxa existent als laboratoris del Institut de Recerca en Energia de Catalunya. Els algoritmes s'implementaran per tal de simular el comportament i posteriorment es programaran directament sobre els elements de la microxarxa per verificar el seu correcte funcionament.. Desenvolupament dels models matemàtics necessaris per a controlar de forma òptima la microxarxa existent als laboratoris del Institut de Recerca en Energia de Catalunya. Els algoritmes s'implementaran per tal de simular el comportament i posteriorment es programaran directament sobre els elements de la microxarxa per verificar el seu correcte funcionament.

Bacterial subfamily of LuxR regulators that respond to plant compounds.

Pseudomonas fluorescens are rhizobacteria known for their biocontrol properties. Several antimicrobial functions are crucial for this process, and the experiments described here investigate the modulation of their expression during the plant-bacterium interaction. The role of a LuxR family regulator in interkingdom signaling has been investigated using genome-scale transcriptome analysis, gene promoter studies in vivo and in vitro, biocontrol assays, and response to plant compounds. PsoR, a LuxR solo or orphan regulator of P. fluorescens, was identified. PsoR is solubilized and activates a lux-box-containing promoter only in the presence of macerated plants, suggesting the presence of a plant molecule(s) that most likely binds to PsoR. Gene expression profiles revealed that genes involved in the inhibition of plant pathogens were affected by PsoR, including a chitinase gene, iron metabolism genes, and biosynthetic genes of antifungal compounds. 2,4-Diacetylphloroglucinol production is PsoR dependent both in vitro and in vivo. psoR mutants were significantly reduced for their ability to protect wheat plants from root rot, and damping-off caused by Pythium ultimum infection. PsoR most likely senses a molecule(s) in the plant and modulates expression of genes that have a role in biocontrol. PsoR and related proteins form a subfamily of LuxR family regulators in plant-associated bacteria.

A T42A Ran Mutation: Differential Interactions with Effectors and Regulators, and Defect in Nuclear Protein Import

Ran, the small, predominantly nuclear GTPase, has been implicated in the regulation of a variety of cellular processes including cell cycle progression, nuclear-cytoplasmic trafficking of RNA and protein, nuclear structure, and DNA synthesis. It is not known whether Ran functions directly in each process or whether many of its roles may be secondary to a direct role in only one, for example, nuclear protein import. To identify biochemical links between Ran and its functional target(s), we have generated and examined the properties of a putative Ran effector mutation, T42A-Ran. T42A-Ran binds guanine nucleotides as well as wild-type Ran and responds as well as wild-type Ran to GTP or GDP exchange stimulated by the Ran-specific guanine nucleotide exchange factor, RCC1. T42A-Ran·GDP also retains the ability to bind p10/NTF2, a component of the nuclear import pathway. In contrast to wild-type Ran, T42A-Ran·GTP binds very weakly or not detectably to three proposed Ran effectors, Ran-binding protein 1 (RanBP1), Ran-binding protein 2 (RanBP2, a nucleoporin), and karyopherin ß (a component of the nuclear protein import pathway), and is not stimulated to hydrolyze bound GTP by Ran GTPase-activating protein, RanGAP1. Also in contrast to wild-type Ran, T42A-Ran does not stimulate nuclear protein import in a digitonin permeabilized cell assay and also inhibits wild-type Ran function in this system. However, the T42A mutation does not block the docking of karyophilic substrates at the nuclear pore. These properties of T42A-Ran are consistent with its classification as an effector mutant and define the exposed region of Ran containing the mutation as a probable effector loop.

Optimal activation of tumor-reactive T cells by selected antigenic peptide analogues.

Many mechanisms have been proposed to explain why immune responses against human tumor antigens are generally ineffective. For example, tumor cells have been shown to develop active immune evasion mechanisms. Another possibility is that tumor antigens are unable to optimally stimulate tumor-specific T cells. In this study we have used HLA-A2/Melan-A peptide tetramers to directly isolate antigen-specific CD8(+) T cells from tumor-infiltrated lymph nodes. This allowed us to quantify the activation requirements of a representative polyclonal yet monospecific tumor-reactive T cell population. The results obtained from quantitative assays of intracellular Ca(2+) mobilization, TCR down-regulation, cytokine production and induction of effector cell differentiation indicate that the naturally produced Melan-A peptides are weak agonists and are clearly suboptimal for T cell activation. In contrast, optimal T cell activation was obtained by stimulation with recently defined peptide analogues. These findings provide a molecular basis for the low immunogenicity of tumor cells and suggest that patient immunization with full agonist peptide analogues may be essential for stimulation and maintenance of anti-tumor T cell responses in vivo.