The Impact of Iodine Deficiency Eradication on Schooling: Evidence from the Introduction of Iodized Salt in Switzerland

This paper examines the impact of salt iodization in Switzerland in the 1920s and 1930s on schooling outcomes. Iodine deficiency in utero causes mental retardation, and correcting the deficiency is expected to increase the productivity of a population by increasing its cognitive ability. The exogenous increase in cognitive ability brought about by the iodization program is also useful in the context of disentangling the effects of innate ability and education in later-life outcomes. I identify the impact of iodization in three ways: first, in a differences-in-differences framework, I exploit geographic variation in iodine deficiency, as well as the fact that the nationwide campaign to decrease iodine deficiency began in 1922. Second, I use spatial and temporal variation in the introduction of iodized salt across Swiss cantons, and examine whether the level of iodized salt sales at the time of one’s birth affected one’s educational attainment. Third, I employ a fuzzy regression discontinuity design and use jumps in sales of iodized salt across Swiss cantons to identify the effect of iodization, by comparing outcomes for those born right before and right after these sudden changes in the treatment environment. These approaches indicate that the eradication of iodine deficiency in previously deficient areas increased the schooling of the population significantly. The effects are larger for females than for males, which is consistent with medical evidence showing that women are more likely to be affected by iodine deficiency disorders than men.

The Economic Effects of Micronutrient Deficiency: Evidence from Salt Iodization in the United States

Iodine deficiency is the leading cause of preventable mental retardation in the world today. Iodine deficiency was common in the developed world until the introduction of iodized salt in the 1920’s. The incidence of iodine deficiency is connected to low iodine levels in the soil and water. We examine the impact of salt iodization in the US by taking advantage of this natural geographic variation. Areas with high pre-treatment levels of iodine deficiency provide a treatment group which we can compare to a control group of low iodine deficiency areas. In the US, salt was iodized over a very short period of time around 1924. We use previously unused data collected during WWI and WWII to compare outcomes of cohorts born before and after iodization, in localities that were naturally poor and rich in iodine. We find evidence of the beneficial effects of iodization on the cognitive abilities of the cohorts exposed to it.

Lack of evidence of the interaction of the Aß peptide with the Wnt signaling cascade in Drosophila models of Alzheimer's disease.

Background Alzheimer's disease (AD) is the leading form of dementia worldwide. The Aß-peptide is believed to be the major pathogenic compound of the disease. Since several years it is hypothesized that Aß impacts the Wnt signaling cascade and therefore activation of this signaling pathway is proposed to rescue the neurotoxic effect of Aß. Findings Expression of the human Aß42 in the Drosophila nervous system leads to a drastically shortened life span. We found that the action of Aß42 specifically in the glutamatergic motoneurons is responsible for the reduced survival. However, we find that the morphology of the glutamatergic larval neuromuscular junctions, which are widely used as the model for mammalian central nervous system synapses, is not affected by Aß42 expression. We furthermore demonstrate that genetic activation of the Wnt signal transduction pathway in the nervous system is not able to rescue the shortened life span or a rough eye phenotype in Drosophila. Conclusions Our data confirm that the life span is a useful readout of Aß42 induced neurotoxicity in Drosophila; the neuromuscular junction seems however not to be an appropriate model to study AD in flies. Additionally, our results challenge the hypothesis that Wnt signaling might be implicated in Aß42 toxicity and might serve as a drug target against AD.

Revisiting the Dollar-Euro Permanent Equilibrium Exchange Rate: Evidence from Multivariate Unobserved Components Models

We propose an alternative approach to obtaining a permanent equilibrium exchange rate (PEER), based on an unobserved components (UC) model. This approach offers a number of advantages over the conventional cointegration-based PEER. Firstly, we do not rely on the prerequisite that cointegration has to be found between the real exchange rate and macroeconomic fundamentals to obtain non-spurious long-run relationships and the PEER. Secondly, the impact that the permanent and transitory components of the macroeconomic fundamentals have on the real exchange rate can be modelled separately in the UC model. This is important for variables where the long and short-run effects may drive the real exchange rate in opposite directions, such as the relative government expenditure ratio. We also demonstrate that our proposed exchange rate models have good out-of sample forecasting properties. Our approach would be a useful technique for central banks to estimate the equilibrium exchange rate and to forecast the long-run movements of the exchange rate.

Evidence for transcript networks composed of chimeric RNAs in human cells.

The classic organization of a gene structure has followed the Jacob and Monod bacterial gene model proposed more than 50 years ago. Since then, empirical determinations of the complexity of the transcriptomes found in yeast to human has blurred the definition and physical boundaries of genes. Using multiple analysis approaches we have characterized individual gene boundaries mapping on human chromosomes 21 and 22. Analyses of the locations of the 5' and 3' transcriptional termini of 492 protein coding genes revealed that for 85% of these genes the boundaries extend beyond the current annotated termini, most often connecting with exons of transcripts from other well annotated genes. The biological and evolutionary importance of these chimeric transcripts is underscored by (1) the non-random interconnections of genes involved, (2) the greater phylogenetic depth of the genes involved in many chimeric interactions, (3) the coordination of the expression of connected genes and (4) the close in vivo and three dimensional proximity of the genomic regions being transcribed and contributing to parts of the chimeric RNAs. The non-random nature of the connection of the genes involved suggest that chimeric transcripts should not be studied in isolation, but together, as an RNA network.

Does Semantic Context Benefit Speech Understanding through "Top-Down" Processes? Evidence from Time-resolved Sparse fMRI.

When speech is degraded, word report is higher for semantically coherent sentences (e.g., her new skirt was made of denim) than for anomalous sentences (e.g., her good slope was done in carrot). Such increased intelligibility is often described as resulting from "top-down" processes, reflecting an assumption that higher-level (semantic) neural processes support lower-level (perceptual) mechanisms. We used time-resolved sparse fMRI to test for top-down neural mechanisms, measuring activity while participants heard coherent and anomalous sentences presented in speech envelope/spectrum noise at varying signal-to-noise ratios (SNR). The timing of BOLD responses to more intelligible speech provides evidence of hierarchical organization, with earlier responses in peri-auditory regions of the posterior superior temporal gyrus than in more distant temporal and frontal regions. Despite Sentence content × SNR interactions in the superior temporal gyrus, prefrontal regions respond after auditory/perceptual regions. Although we cannot rule out top-down effects, this pattern is more compatible with a purely feedforward or bottom-up account, in which the results of lower-level perceptual processing are passed to inferior frontal regions. Behavioral and neural evidence that sentence content influences perception of degraded speech does not necessarily imply "top-down" neural processes.

International Evidence on the New Keynesian Phillips Curve Using Aggregate and Disaggregate Data

We present a unique empirical analysis of the properties of the New Keynesian Phillips Curve using an international dataset of aggregate and disaggregate sectoral in ation. Our results from panel time-series estimation clearly indicate that sectoral heterogeneity has important consequences for aggregate in ation behaviour. Heterogeneity helps to explain the overestimation of in ation persistence and underestimation of the role of marginal costs in empirical investigations of the NKPC that use aggregate data. We nd that combining disaggregate information with heterogeneous-consistent estimation techniques helps to reconcile, to a large extent, the NKPC with the data.

Corruption and the Military in Politics: Theory and Evidence from around the World

Recent theoretical developments and case study evidence suggests a relationship between the military in politics and corruption. This study contributes to this literature by analyzing theoretically and empirically the role of the military in politics and corruption for the first time. By drawing on a cross sectional and panel data set covering a large number of countries, over the period 1984-2007, and using a variety of econometric methods substantial empirical support is found for a positive relationship between the military in politics and corruption. In sum, our results reveal that a one standard deviation increase in the military in politics leads to a 0.22 unit increase in corruption index. This relationship is shown to be robust to a variety of specification changes, different econometric techniques, different sample sizes, alternative corruption indices and the exclusion of outliers. This study suggests that the explanatory power of the military in politics is at least as important as the conventionally accepted causes of corruption, such as economic development.

Inflation Uncertainty, Exchange Rate Depreciation and Volatility: Evidence from Ghana, Mozambique and Tanzania

While flexible exchange rates facilitate stabilisation, exchange rate fluctuations can cause real volatility. This gives policy importance to the causal relationship between exchange rate depreciation and its volatility. An exchange rate may be expected to become more volatile when the underlying currency loses value. We conjecture that a reverse causation, which further weakens the currency, may be mitigated by price stability. Data from Ghana, Mozambique and Tanzania support this: depreciation makes exchange rate more volatile for all but volatility does not causes depreciation in Tanzania which has enjoyed a more stable inflation despite all countries adopting similar macro-policies since early 1990s.

Does China overinvest? Evidence from a panel of Chinese firms

This paper addresses the hotly-debated question: do Chinese firms overinvest? A firm-level dataset of 100,000 firms over the period of 2000-07 is employed for this purpose. We initially calculate measures of investment efficiency, which is typically negatively associated with overinvestment. Despite wide disparities across various ownership groups, industries and regions, we find that corporate investment in China has become increasingly efficient over time. However, based on direct measures of overinvestment that we subsequently calculate, we find evidence of overinvestment for all types of firms, even in the most efficient and most profitable private sector. We find that the free cash flow hypothesis provides a good explanation for China‟s overinvestment, especially for the private sector, while in the state sector, overinvestment is attributable to the poor screening and monitoring of enterprises by banks.

The effects of agglomeration on wages: evidence from the micro-level

This paper estimates individual wage equations in order to test two rival non-nested theories of economic agglomeration, namely New Economic Geography (NEG), as represented by the NEG wage equation and urban economic (UE) theory , in which wages relate to employment density. The paper makes an original contribution by evidently being the first empirical paper to examine the issue of agglomeration processes associated with contemporary theory working with micro-level data, highlighting the role of gender and other individual-level characteristics. For male respondents, there is no significant evidence that wage levels are an outcome of the mechanisms suggested by NEG or UE theory, but this is not the case for female respondents. We speculate on the reasons for the gender difference.

Experimental evidence of a sunk–cost paradox: a study of pricing behavior in Bertrand–Edgeworth duopoly

A well–known implication of microeconomic theory is that sunk costs should have no effect on decision making. We test this hypothesis with a human–subjects experiment. Students recruited from graduate business courses, with an average of over six years of work experience, played the role of firms in a repeated price–setting duopoly game in which both firms had identical capacity constraints and costs, including a sunk cost that varied across experimental sessions over six different values. We find, contrary to the prediction of microeconomic theory, that subjects’ pricing decisions show sizable differences across treatments. The effect of the sunk cost is non–monotonic: as it increases from low to medium levels, average prices decrease, but as it increases from medium to high levels, average prices increase. These effects are not apparent initially, but develop quickly and persist throughout the game. Cachon and Camerer’s (1996) loss avoidance is consistent with both effects, while cost–based pricing predicts only the latter effect, and is inconsistent with the former.

Firm size and trade secret intensity: evidence from the Economic Espionage Act

This paper considers trade secrecy as an appropriation mechanism in the context ofb the US Economic Espionage Act (EEA) 1996. We examine the relation between trade secret intensity and firm size, using a cross section of 95 court cases. The paper builds on extant work in three respects. First, we create a unique body of evidence, using EEA prosecutions from 1996 to 2008. Second, we use an econometric approach to measurement, estimation and hypothesis testing. This allows us comprehensively to test the robustness of findings. Third, we focus on objectively measured valuations, instead of the subjective, self-reported values used elsewhere. We find a stable, robust value for the elasticity of trade secret intensity with respect to firm size, which indicates that a 10% reduction in firm size leads to a 7% increase in trade secret intensity. We find that this result is not sensitive to industrial sector, sample trimming, or functional form.

The Impact of Population Ageing on the Labour Market: Evidence from Overlapping Generations Computable General Equilibrium (OLG-CGE) Model of Scotland

This paper presents a dynamic Overlapping Generations Computable General Equilibrium (OLG-CGE) model of Scotland. The model is used to examine the impact of population ageing on the labour market. More specifically, it is used to evaluate the effects of labour force decline and labour force ageing on key macro-economic variables. The second effect is assumed to operate through age-specific productivity and labour force participation. In the analysis, particular attention is paid to how population ageing impinges on the government expenditure constraint. The basic structure of the model follows in the Auerbach and Kotlikoff tradition. However, the model takes into consideration directly age-specific mortality. This is analogous to “building in” a cohort-component population projection structure to the model, which allows more complex and more realistic demographic scenarios to be considered.