Essays in heterogeneous agent macroeconomics

This thesis is comprised of three chapters. The first article studies the determinants of the labor force participation of elderly American males and investigates the factors that may account for the changes in retirement between 1950 and 2000. We develop a life-cycle general equilibrium model with endogenous retirement that embeds Social Security legislation and Medicare. Individuals are ex ante heterogeneous with respect to their preferences for leisure and face uncertainty about labor productivity, health status and out-of-pocket medical expenses. The model is calibrated to the U.S. economy in 2000 and is able to reproduce very closely the retirement behavior of the American population. It reproduces the peaks in the distribution of Social Security applications at ages 62 and 65 and the observed facts that low earners and unhealthy individuals retire earlier. It also matches very closely the increase in retirement from 1950 to 2000. Changes in Social Security policy - which became much more generous - and the introduction of Medicare account for most of the expansion of retirement. In contrast, the isolated impact of the increase in longevity was a delaying of retirement. In the second article, I develop an overlapping generations model of criminal behavior, which extends prior research on crime by taking into account individuals' labor supply decisions and the stigma effect that affects convicted offenders, lowering their likelihood of employment. I use the model to guide a quantitative assessment of the determinants of crime and of a counterfactual experiment in which an income redistribution policy is thought as an alternative to greater law enforcement. The model economy considered in this paper is populated by heterogeneous agents who live for a realistic number of periods, have preferences over consumption and leisure, and differ in terms of their age, their skills as well as their employment shocks. In addition, savings may be precautionary and allow partial insurance against the labor income shocks. Because of the lack of full insurance, this model generates an endogenous distribution of wealth across consumers, enabling us to assess the welfare implications of the redistribution policy experiment. I calibrated the model using the US data for 1980 and then use the model to investigate the changes in criminality between 1980 and 1996. The main results that come out of this study are: 1) Law enforcement policy was the most important factor behind the fall in criminality in the period, while the increase in inequality was the most important single factor promoting crime; 2) Stigmatization is not a free-cost crime control policy; 3) Income redistribution can be a powerful alternative policy to fight crime. Finally, the third article studies the impact of HIV/AIDS on per capita income and education. It explores two channels from HIV/AIDS to income that have not been sufficiently stressed by the literature: the reduction of the incentives to study due to shorter expected longevity and the reduction of productivity of experienced workers. In the model individuals live for three periods, may get infected in the second period and with some probability die of Aids before reaching the third period of their life. Parents care for the welfare of the future generations so that they will maximize lifetime utility of their dynasty. The simulations predict that the most affected countries in Sub-Saharan Africa will be in the future, on average, thirty percent poorer than they would be without AIDS. Schooling will decline in some cases by forty percent. These figures are dramatically reduced with widespread medical treatment, as it increases the survival probability and productivity of infected individuals.

Comparative advantage, heterogeneous firms and variable mark-ups

We develop a model of comparative advantage with monopolistic competition, that incorporates heterogeneous firms and endogenous mark-ups. We analyse how these features vary across countries with different factor endowments, and across markets of different size. In this model we can obtain trade gains via two channels. First, when we open the economy, most productive firms start to export their product, then, they demand more producing factors and wages rises, thus, those firms that are less productive will be forced to stop to produce. Second channel is via endogenous mark-ups, when we open the economy, the competition gets ``tougher'', then, mark-ups falls, thus, those firms that are less productive will stop to produce. We also show that comparative advantage works as a ``third channel'' of trade gains, because, all trade gains results are magnified in comparative advantage industry of both countries. We also make a numerical exercise to see how endogenous variables of the model vary when trade costs fall.

Profit sharing with heterogeneous entrepreneural prowess

This paper analyzes the impact of profit sharing on the incentives that individuals face to set up their own business. It presents a model of capital accumulation in which individuals are equally skilled to be workers but differ in their abilities to manage a firmo It is shown that profit sharing can inhibit entrepreneurial initiatives, reducing the number of firms in operation, the aggregate output and the economy's long run capital stock.

On the optimality of the Friedman Rule with heterogeneous agents and non-linear income taxation

We study the optimal “inflation tax” in an environment with heterogeneous agents and non-linear income taxes. We first derive the general conditions needed for the optimality of the Friedman rule in this setup. These general conditions are distinct in nature and more easily interpretable than those obtained in the literature with a representative agent and linear taxation. We then study two standard monetary specifications and derive their implications for the optimality of the Friedman rule. For the shopping-time model the Friedman rule is optimal with essentially no restrictions on preferences or transaction technologies. For the cash-credit model the Friedman rule is optimal if preferences are separable between the consumption goods and leisure, or if leisure shifts consumption towards the credit good. We also study a generalized model which nests both models as special cases.

Essays on household taxation and competition between heterogeneous firms

Essa tese é constituída por três artigos: "Tax Filing Choices for the Household", "Optimal Tax for the Household: Collective and Unitary Approaches" e "Vertical Differentiation and Heterogeneous Firms".

Dynamic coordination among heterogeneous agents

We study a dynamic model of coordination with timing frictions and payoff heterogeneity. There is a unique equilibrium, characterized by thresholds that determine the choices of each type of agent. We characterize equilibrium for the limiting cases of vanishing timing frictions and vanishing shocks to fundamentals. A lot of conformity emerges: despite payoff heterogeneity, agents’ equilibrium thresholds partially coincide as long as there exists a set of beliefs that would make this coincidence possible – though they never fully coincide. In case of vanishing frictions, the economy behaves almost as if all agents were equal to an average type. Conformity is not inefficient. The efficient solution would have agents following others even more often and giving less importance to the fundamental

Homogeneous middles vs. heterogeneous tails, and the end of the ‘Inverted-U’: the share of the rich is what it’s all about

This paper examines the current global scene of distributional disparities within-nations. There are six main conclusions. First, about 80 per cent of the world’s population now live in regions whose median country has a Gini not far from 40. Second, as outliers are now only located among middle-income and rich countries, the ‘upwards’ side of the ‘Inverted-U’ between inequality and income per capita has evaporated (and with it the statistical support there was for the hypothesis that posits that, for whatever reason, ‘things have to get worse before they can get better’). Third, among middle-income countries Latin America and mineral-rich Southern Africa are uniquely unequal, while Eastern Europe follows a distributional path similar to the Nordic countries. Fourth, among rich countries there is a large (and growing) distributional diversity. Fifth, within a global trend of rising inequality, there are two opposite forces at work. One is ‘centrifugal’, and leads to an increased diversity in the shares appropriated by the top 10 and bottom 40 per cent. The other is ‘centripetal’, and leads to a growing uniformity in the income-share appropriated by deciles 5 to 9. Therefore, half of the world’s population (the middle and upper-middle classes) have acquired strong ‘property rights’ over half of their respective national incomes; the other half, however, is increasingly up for grabs between the very rich and the poor. And sixth, Globalisation is thus creating a distributional scenario in which what really matters is the income-share of the rich — because the rest ‘follows’ (middle classes able to defend their shares, and workers with ever more precarious jobs in ever more ‘flexible’ labour markets). Therefore, anybody attempting to understand the within-nations disparity of inequality should always be reminded of this basic distributional fact following the example of Clinton’s campaign strategist: by sticking a note on their notice-boards saying “It’s the share of the rich, stupid”.

A proposal to the supervision of processes in an industrial environment with heterogeneous systems

SOUZA, Rodrigo B. ; MEDEIROS, Adelardo A. D. ; NASCIMENTO, João Maria A. ; GOMES, Heitor P. ; MAITELLI, André L. A Proposal to the Supervision of Processes in an Industrial Environment with Heterogeneous Systems. In: INTERNATIONAL CONFERENCE OF THE IEEEOF THE INDUSTRUI ELECTRONICS SOCIETY,32., Paris, 2006, Paris. Anais... Paris: IECON, 2006

Distribution of Ra-226, Th-232 and K-40 in soils and sugar cane crops at Corumbatai river basin, São Paulo State, Brazil

Fundação de Amparo à Pesquisa do Estado de São Paulo (FAPESP)

Peat humic substances enriched with nutrients for agricultural applications: Competition between nutrients and non-essential metals present in tropical soils

Coordenação de Aperfeiçoamento de Pessoal de Nível Superior (CAPES)

Comparison of microbial numbers in soils by using various culture media and temperatures

The influence of different media and incubation temperatures on the quantification of microbial populations in sorghum, eucalyptus and forest soils was evaluated. Microbial growth was compared by using complex (tryptone soybean agar, TSA, casein-starch, CS, and Martin) and saline (Thorton, M3, Czapeck) media and incubation temperatures of 25 and 30° C. Higher numbers of total bacterial. and fungal colony-forming units (CFU) were observed in sorghum soils, and of spore-forming and Gram-negative bacteria in forest soils than other soils. Actinomycetes counts were highest in forest soil when using CS medium at 30° C and in sorghum soil at 25° C in M3 medium. Microorganism counts were dependent on the media and incubation temperatures. The counts at temperatures of 30° C were significantly higher than at 25° C. Microbial quantification was best when using TSA medium for total. and spore-forming bacteria, Thorton for Gram-negative bacteria, M3 for actinomycetes, and Martin for fungi. © 2005 Elsevier GmbH. All rights reserved.

Carbon, nitrogen and phosphorus mineralization in two soils amended with distillery yeast

The possibility of using yeast from alcohol distilleries as a source of nutrients in soil was investigated. The following treatments were used: no fertilization (control), 0.5% (w/w) yeast, 1% (w/w) yeast, and NPK. The decomposition of yeast was monitored for 90 days in two soils. The CO, production and the microbial biomass were increased by art average of 1- to 3-fold by yeast incorporation compared to control. Protease activity also was enhanced 3- to 8-fold in the soils supplemented with yeast compared to control. The phosphatase activities were higher than control only during the first days. While nitrate contents increased in all treatments compared to control, available P only increased in the soils amended with 1%, yeast or NPK by 45-119% and 309-489%, respectively. These results indicate that there exists an excellent potential for the use of yeast in the soil as a source of nitrate and available P for plant nutrition. (C) 2003 Elsevier Ltd. All rights reserved.

Nickel adsorption by soils in relation to pH, organic matter, and iron oxides

There is little information on nickel adsorption by Brazilian soils. The objective of this experiment was to determine the effect of pH, organic matter, and iron oxides on nickel adsorption by three soils: a clayey Anionic Rhodic Acrudox, a sandy clay loam Anionic Xanthic Acrudox, and a clayey Rhodic Hapludalf. Soil samples were collected from the 0-0.2 in layer and treated to eliminate organic matter and iron oxides. The nickel adsorption was evaluated in the original samples and in those treated to remove organic matter and to remove both, organic matter and iron oxides, using 2 g soil + 20 mL of 0.01 mol L-1 CaCl2 solution containing 5 mg L-1 Ni, pH varying from 3.5 to 7.5. The nickel adsorption decreased with the elimination of organic matter. For the samples without organic matter and iron oxides, adsorption decreased only in the Anionic Rhodic Acrudox. The pH was the main factor involved in nickel adsorption variation, and for soil samples without organic matter and iron oxides, the maximum adsorption occurred at higher pH values.

Soil sampling intensity and spatial distribution pattern of soils attributes and corn yield in no-tillage system

Fundação de Amparo à Pesquisa do Estado de São Paulo (FAPESP)