The Macroeconomic Effects of Fiscal Policy in a Small Open Economy under a Flexible Exchange Rate Regime

This licentiate's thesis analyzes the macroeconomic effects of fiscal policy in a small open economy under a flexible exchange rate regime, assuming that the government spends exclusively on domestically produced goods. The motivation for this research comes from the observation that the literature on the new open economy macroeconomics (NOEM) has focused almost exclusively on two-country global models and the analyses of the effects of fiscal policy on small economies are almost completely ignored. This thesis aims at filling in the gap in the NOEM literature and illustrates how the macroeconomic effects of fiscal policy in a small open economy depend on the specification of preferences. The research method is to present two theoretical model that are extensions to the model contained in the Appendix to Obstfeld and Rogoff (1995). The first model analyzes the macroeconomic effects of fiscal policy, making use of a model that exploits the idea of modelling private and government consumption as substitutes in private utility. The model offers intuitive predictions on how the effects of fiscal policy depend on the marginal rate of substitution between private and government consumption. The findings illustrate that the higher the substitutability between private and government consumption, (i) the bigger is the crowding out effect on private consumption (ii) and the smaller is the positive effect on output. The welfare analysis shows that the less fiscal policy decreases welfare the higher is the marginal rate of substitution between private and government consumption. The second model of this thesis studies how the macroeconomic effects of fiscal policy depend on the elasticity of substitution between traded and nontraded goods. This model reveals that this elasticity a key variable to explain the exchange rate, current account and output response to a permanent rise in government spending. Finally, the model demonstrates that temporary changes in government spending are an effective stabilization tool when used wisely and timely in response to undesired fluctuations in output. Undesired fluctuations in output can be perfectly offset by an opposite change in government spending without causing any side-effects.

Image, Political

Political communication scholars, journalists, and political actors alike, argue that the political process, and deliberative democracy (democracy founded on informed discussion inclusive of citizens), have lost their rational authenticity in that image and media spectacle have become more central to public opinion formation and electoral outcomes than policy. This entry examines the validity of that perception, and the extent to which “image” has emerged as a more significant factor in the political process. And if image is so important in political culture, what the impacts might be on the functioning of democratic processes.

Processing Response of Boron Modified Ti-6Al-4V Alloy In (alpha plus beta) Working Regime

Titanium alloys like Ti-6A-4V are the backbone materials for aerospace, energy and chemical industries. Hypoeutectic boron addition to Ti-6Al-4V alloy produces a reduction in as-cast grain size by roughly an order of magnitude resulting in the possibility of avoiding ingot breakdown step and thereby reducing the processing cost. In the present study, ISM processed as-cast boron added Ti-6Al-4V alloy is deformed in (alpha+beta)-phase field, where alpha-lath bending seemed to be the dominating deformation mechanism.

Communication and Political Crisis: Media, Politics and Governance in a Globalized Public Sphere

Communication and Political Crisis explores the role of the global media in a period of intensifying geopolitical conflict. Through case studies drawn from domestic and international political crises such as the conflicts in the Middle East and Ukraine, leading media scholar Brian McNair argues that the digitized, globalized public sphere now confronted by all political actors has produced new opportunities for social progress and democratic reform, as well as new channels for state propaganda and terrorist spectaculars such as those performed by the Islamic State and Al Qaeda. In this major work, McNair argues that the role of digital communication will be crucial in determining the outcome of pressing global issues such as the future of feminism and gay rights, freedom of speech and media, and democracy itself.

Subquadratic wavenumber dependence of the structural relaxation of supercooled liquid in the crossover regime

As a liquid is progressively supercooled toward its glass transition temperature, an intriguing weakening of the wavenumber (q) dependence of the structural relaxation time tau(q) in the intermediate-to-large q limit is observed both in experiments and simulation studies. Neither continuous Brownian diffusive dynamics nor discontinuous activated events can alone explain the anomalous wavenumber dependence. Here we use our recently developed theory that unifies the mode coupling theory for continuous dynamics, with the random first order transition theory treatment of activated discontinuous motion as a nucleationlike instanton process to understand the wavenumber dependence of density relaxation. The predicted smooth change in mechanism of relaxation from diffusive to activated, in the crossover regime, is wavevector dependent and appears to be responsible for the observed subquadratic,nalmost linear, q dependence of the relaxation time.

Investigation of activated transport in hole doped rare earth manganites in the high temperature paramagnetic regime

Electronic transport in the high temperature paramagnetic regime of the colossal magnetoresistive oxides, La(1-x)A(x)MnO(3), A=Ca, Sr, Ba, x similar or equal to 0.1-0.3, has been investigated using resistivity measurements. The main motivation for this work is to relook into the actual magnitude of the activation energy for transport in a number of manganites and study its variation as a function of hole doping (x), average A-site cation radius (< r(A)>), cationic disorder (sigma(2)) and strain (epsilon(zz)). We show that contrary to current practice, the description of a single activation energy in this phase is not entirely accurate. Our results clearly reveal a strong dependence of the activation energy on the hole doping as well as disorder. Comparing the results across different substituent species with different < r(A)> reveals the importance of sigma(2) as a metric to qualify any analysis based on (r(A)). (c) 2006 Elsevier Ltd. All rights reserved.

Deformation and crystallization of Zr-based amorphous alloys in homogeneous flow regime

The purpose of this study is to experimentally investigate the interaction of inelastic deformation and microstructural changes of two Zr-based bulk metallic glasses (BMGs): Zr41.25Ti13.75Cu12.5Ni10Be22.5 (commercially designated as Vitreloy 1 or Vit1) and Zr46.75Ti8.25Cu7.5Ni10Be27.5 (Vitreloy 4, Vit4). High-temperature uniaxial compression tests were performed on the two Zr alloys at various strain rates, followed by structural characterization using differential scanning calorimetry (DSC) and transmission electron microscopy (TEM). Two distinct modes of mechanically induced atomic disordering in the two alloys were observed, with Vit1 featuring clear phase separation and crystallization after deformation as observed with TEM, while Vit4 showing only structural relaxation with no crystallization. The influence of the structural changes on the mechanical behaviors of the two materials was further investigated by jump-in-strain-rate tests, and flow softening was observed in Vit4. A free volume theory was applied to explain the deformation behaviors, and the activation volumes were calculated for both alloys.

Somali State Failure: Players, Incentives and Institutions

In Somalia the central government collapsed in 1991 and since then state failure became a widespread phenomenon and one of the greatest political and humanitarian problems facing the world in this century. Thus, the main objective of this research is to answer the following question: What went wrong? Most of the existing literature on the political economy of conflict starts from the assumption that state in Africa is predatory by nature. Unlike these studies, the present research, although it uses predation theory, starts from the social contract approach of state definition. Therefore, rather than contemplating actions and policies of the rulers alone, this approach allows us to deliberately bring the role of the society – as citizens – and other players into the analyses. In Chapter 1, after introducing the study, a simple principal-agent model will be developed to check the logical consistence of the argument and to make the identification of causal mechanism easier. I also identify three main actors in the process of state failure in Somalia: the Somali state, Somali society and the superpowers. In Chapter 2, so as to understand the incentives, preferences and constraints of each player in the state failure game, I in some depth analyse the evolution and structure of three central informal institutions: identity based patronage system of leadership, political tribalism, and the Cold War. These three institutions are considered as the rules of the game in the Somali state failure. Chapter 3 summarises the successive civilian governments’ achievements and failures (1960-69) concerning the main national goals, national unification and socio-economic development. Chapter 4 shows that the military regime, although it assumed power through extralegal means, served to some extent the developmental interest of the citizens in the first five years of its rule. Chapter 5 shows the process, and the factors involved, of the military regime’s self-transformation from being an agent for the developmental interests of the society to a predatory state that not only undermines the interests of the society but that also destroys the state itself. Chapter 6 addresses the process of disintegration of the post-colonial state of Somalia. The chapter shows how the regime’s merciless reactions to political ventures by power-seeking opposition leaders shattered the entire country and wrecked the state institutions. Chapter 7 concludes the study by summarising the main findings: due to the incentive structures generated by the informal institutions, the formal state institutions fell apart.

Political Risk in Credit Evaluation: Empirical Studies and Survey Results

Financing trade between economic agents located in different countries is affected by many types of risks, resulting from incomplete information about the debtor, the problems of enforcing international contracts, or the prevalence of political and financial crises. Trade is important for economic development and the availability of trade finance is essential, especially for developing countries. Relatively few studies treat the topic of political risk, particularly in the context of international lending. This thesis explores new ground to identify links between political risk and international debt defaults. The core hypothesis of the study is that the default probability of debt increases with increasing political risk in the country of the borrower. The thesis consists of three essays that support the hypothesis from different angles of the credit evaluation process. The first essay takes the point of view of an international lender assessing the credit risk of a public borrower. The second investigates creditworthiness assessment of companies. The obtained results are substantiated in the third essay that deals with an extensive political risk survey among finance professionals in developing countries. The financial instruments of core interest are export credit guaranteed debt initiated between the Export Credit Agency of Finland and buyers in 145 countries between 1975 and 2006. Default events of the foreign credit counterparts are conditioned on country-specific macroeconomic variables, corporate-specific accounting information as well as political risk indicators from various international sources. Essay 1 examines debt issued to government controlled institutions and conditions public default events on traditional macroeconomic fundamentals, in addition to selected political and institutional risk factors. Confirming previous research, the study finds country indebtedness and the GDP growth rate to be significant indicators of public default. Further, it is shown that public defaults respond to various political risk factors. However, the impact of the risk varies between countries at different stages of economic development. Essay 2 proceeds by investigating political risk factors as conveivable drivers of corporate default and uses traditional accounting variables together with new political risk indicators in the credit evaluation of private debtors. The study finds links between corporate default and leverage, as well as between corporate default and the general investment climate and measeures of conflict in the debtor country. Essay 3 concludes the thesis by offering survey evidence on the impact of political risk on debt default, as perceived and experienced by 103 finance professionals in 38 developing countries. Taken together, the results of the thesis suggest that various forms of political risk are associated with international debt defaults and continue to pose great concerns for both international creditors and borrowers in developing countries. The study provides new insights on the importance of variable selection in country risk analysis, and shows how political risk is actually perceived and experienced in the riskier, often lower income countries of the global economy.