Three Essays on the Formation and Impact of Economic Policy

Introduction In my thesis I argue that economic policy is all about economics and politics. Consequently, analysing and understanding economic policy ideally has at least two parts. The economics part, which is centered around the expected impact of a specific policy on the real economy both in terms of efficiency and equity. The insights of this part point into which direction the fine-tuning of economic policies should go. However, fine-tuning of economic policies will be most likely subject to political constraints. That is why, in the politics part, a much better understanding can be gained by taking into account how the incentives of politicians and special interest groups as well as the role played by different institutional features affect the formation of economic policies. The first part and chapter of my thesis concentrates on the efficiency-related impact of economic policies: how does corporate income taxation in general, and corporate income tax progressivity in specific, affect the creation of new firms? Reduced progressivity and flat-rate taxes are in vogue. By 2009, 22 countries are operating flat-rate income tax systems, as do 7 US states and 14 Swiss cantons (for corporate income only). Tax reform proposals in the spirit of the "flat tax" model typically aim to reduce three parameters: the average tax burden, the progressivity of the tax schedule, and the complexity of the tax code. In joint work, Marius Brülhart and I explore the implications of changes in these three parameters on entrepreneurial activity, measured by counts of firm births in a panel of Swiss municipalities. Our results show that lower average tax rates and reduced complexity of the tax code promote firm births. Controlling for these effects, reduced progressivity inhibits firm births. Our reading of these results is that tax progressivity has an insurance effect that facilitates entrepreneurial risk taking. The positive effects of lower tax levels and reduced complexity are estimated to be significantly stronger than the negative effect of reduced progressivity. To the extent that firm births reflect desirable entrepreneurial dynamism, it is not the flattening of tax schedules that is key to successful tax reforms, but the lowering of average tax burdens and the simplification of tax codes. Flatness per se is of secondary importance and even appears to be detrimental to firm births. The second part of my thesis, which corresponds to the second and third chapter, concentrates on how economic policies are formed. By the nature of the analysis, these two chapters draw on a broader literature than the first chapter. Both economists and political scientists have done extensive research on how economic policies are formed. Thereby, researchers in both disciplines have recognised the importance of special interest groups trying to influence policy-making through various channels. In general, economists base their analysis on a formal and microeconomically founded approach, while abstracting from institutional details. In contrast, political scientists' frameworks are generally richer in terms of institutional features but lack the theoretical rigour of economists' approaches. I start from the economist's point of view. However, I try to borrow as much as possible from the findings of political science to gain a better understanding of how economic policies are formed in reality. In the second chapter, I take a theoretical approach and focus on the institutional policy framework to explore how interactions between different political institutions affect the outcome of trade policy in presence of special interest groups' lobbying. Standard political economy theory treats the government as a single institutional actor which sets tariffs by trading off social welfare against contributions from special interest groups seeking industry-specific protection from imports. However, these models lack important (institutional) features of reality. That is why, in my model, I split up the government into a legislative and executive branch which can both be lobbied by special interest groups. Furthermore, the legislative has the option to delegate its trade policy authority to the executive. I allow the executive to compensate the legislative in exchange for delegation. Despite ample anecdotal evidence, bargaining over delegation of trade policy authority has not yet been formally modelled in the literature. I show that delegation has an impact on policy formation in that it leads to lower equilibrium tariffs compared to a standard model without delegation. I also show that delegation will only take place if the lobby is not strong enough to prevent it. Furthermore, the option to delegate increases the bargaining power of the legislative at the expense of the lobbies. Therefore, the findings of this model can shed a light on why the U.S. Congress often practices delegation to the executive. In the final chapter of my thesis, my coauthor, Antonio Fidalgo, and I take a narrower approach and focus on the individual politician level of policy-making to explore how connections to private firms and networks within parliament affect individual politicians' decision-making. Theories in the spirit of the model of the second chapter show how campaign contributions from lobbies to politicians can influence economic policies. There exists an abundant empirical literature that analyses ties between firms and politicians based on campaign contributions. However, the evidence on the impact of campaign contributions is mixed, at best. In our paper, we analyse an alternative channel of influence in the shape of personal connections between politicians and firms through board membership. We identify a direct effect of board membership on individual politicians' voting behaviour and an indirect leverage effect when politicians with board connections influence non-connected peers. We assess the importance of these two effects using a vote in the Swiss parliament on a government bailout of the national airline, Swissair, in 2001, which serves as a natural experiment. We find that both the direct effect of connections to firms and the indirect leverage effect had a strong and positive impact on the probability that a politician supported the government bailout.

FOXC2 controls formation and maturation of lymphatic collecting vessels through cooperation with NFATc1.

The mechanisms of blood vessel maturation into distinct parts of the blood vasculature such as arteries, veins, and capillaries have been the subject of intense investigation over recent years. In contrast, our knowledge of lymphatic vessel maturation is still fragmentary. In this study, we provide a molecular and morphological characterization of the major steps in the maturation of the primary lymphatic capillary plexus into collecting lymphatic vessels during development and show that forkhead transcription factor Foxc2 controls this process. We further identify transcription factor NFATc1 as a novel regulator of lymphatic development and describe a previously unsuspected link between NFATc1 and Foxc2 in the regulation of lymphatic maturation. We also provide a genome-wide map of FOXC2-binding sites in lymphatic endothelial cells, identify a novel consensus FOXC2 sequence, and show that NFATc1 physically interacts with FOXC2-binding enhancers. As damage to collecting vessels is a major cause of lymphatic dysfunction in humans, our results suggest that FOXC2 and NFATc1 are potential targets for therapeutic intervention.

Partir de soi, rencontrer l'autre--quelques réflexions sur la formation de psychiatre [The self and the other: a few comments on psychiatric education].

This manuscript has served for an oral presentation in honour of Professor Pierre Bovet who retired from his position as head physician at the Department of Psychiatry of the Lausanne University Hospital, Switzerland. Pierre Bovet has focused his clinical and scientific interest and his teaching activities on the schizophrenic spectrum disorders. The author tries to describe the essential elements of a clinical attitude which allows to really encounter the patient.

A role for the src family kinase Fyn in NK cell activation and the formation of the repertoire of Ly49 receptors.

NK cell function is regulated by a dual receptor system, which integrates signals from triggering receptors and MHC class I-specific inhibitory receptors. We show here that the src family kinase Fyn is required for efficient, NK cell-mediated lysis of target cells, which lack both self-MHC class I molecules and ligands for NKG2D, an activating NK cell receptor. In contrast, NK cell inhibition by the MHC class I-specific receptor Ly49A was independent of Fyn, suggesting that Fyn is specifically required for NK cell activation via non-MHC receptor(s). Compared to wild type, significantly fewer Fyn-deficient NK cells expressed the inhibitory Ly49A receptor. The presence of a transgenic Ly49A receptor together with its H-2(d) ligand strongly reduced the usage of endogenous Ly49 receptors in Fyn-deficient mice. These data suggest a model in which the repertoire of inhibitory Ly49 receptors is formed under the influenced of Fyn-dependent NK cell activation as well as the respective MHC class I environment. NK cells may acquire Ly49 receptors until they generate sufficient inhibitory signals to balance their activation levels. Such a process would ensure the induction of NK cell self-tolerance.

Periodic accumulation of cdc15 mRNA is not necessary for septation in Schizosaccharomyces pombe.

Analysis of Schizosaccharomyces pombe mutants that are defective in septum formation and cytokinesis has identified the product of the cdc15 gene as a key element in formation of a division septum. S. pombe cells lacking cdc15p function cannot assemble a functional medial ring, and do not make a division septum. cdc15 mRNA accumulates periodically during the cell cycle, peaking after entry into mitosis, and increased expression of the gene in G2-arrested cells can promote F-actin ring formation. Here, we have investigated the effects of mutations that block cell division upon the expression of cdc15 in synchronised cell populations, and analysed the expression of cdc15 when septum formation is induced by ectopic activation of the septation signalling network. We concluded the following: (i) the septation signalling network genes are not required for periodic accumulation of cdc15 mRNA; (ii) induction of septum formation in G2-arrested cells by activation of the septation signalling network does not result in accumulation of cdc15 mRNA, which is therefore not a prerequisite for septum formation; (iii) failure to turn off septum formation at the end of mitosis results in continued expression of cdc15; and (iv) periodic accumulation of cdc15 mRNA is mediated by a 97 bp region 5' to the mRNA start site.

Technology, business models and network structure in the airline industry

Network airlines have been increasingly focusing their operations on hub airports through the exploitation of connecting traffic, allowing them to take advantage of economies of traffic density, which are unequivocal in the airline industry. Less attention has been devoted to airlines? decisions on point-to-point thin routes, which could be served using different aircraft technologies and different business models. This paper examines, both theoretically and empirically, the impact on airlines ?networks of the two major innovations in the airline industry in the last two decades: the regional jet technology and the low-cost business model. We show that, under certain circumstances, direct services on point-to-point thin routes can be viable and thus airlines may be interested in deviating passengers out of the hub.

Agglutinating Secretory IgA Preserves Intestinal Epithelial Cell Integrity during Apical Infection by Shigella flexneri.

Shigella flexneri, by invading intestinal epithelial cells (IECs) and inducing inflammatory responses of the colonic mucosa, causes bacillary dysentery. Although M cells overlying Peyer's patches are commonly considered the primary site of entry of S. flexneri, indirect evidence suggests that bacteria can also use IECs as a portal of entry to the lamina propria. Passive delivery of secretory IgA (SIgA), the major immunoglobulin secreted at mucosal surfaces, has been shown to protect rabbits from experimental shigellosis, but no information exists as to its molecular role in maintaining luminal epithelial integrity. We have established that the interaction of virulent S. flexneri with the apical pole of a model intestinal epithelium consisting of polarized Caco-2 cell monolayers resulted in the progressive disruption of the tight junction network and actin depolymerization, eventually resulting in cell death. The lipopolysaccharide (LPS)-specific agglutinating SIgAC5 monoclonal antibody (MAb), but not monomeric IgAC5 or IgGC20 MAbs of the same specificity, achieved protective functions through combined mechanisms, including limitation of the interaction between S. flexneri and epithelial cells, maintenance of the tight junction seal, preservation of the cell morphology, reduction of NF-κB nuclear translocation, and inhibition of proinflammatory mediator secretion. Our results add to the understanding of the function of SIgA-mediated immune exclusion by identifying a mode of action whereby the formation of immune complexes translates into maintenance of the integrity of epithelial cells lining the mucosa. This novel mechanism of protection mediated by SIgA is important to extend the arsenal of effective strategies to fight against S. flexneri mucosal invasion.

Positive Torsional Strain Causes the Formation of a Four-Way Junction at Replication Forks.

Research by L. Postow, C. Ullsperger, R.W. Keller, C. Bustamante, A.V. Vologodskii, and N.R. Cozzarelli, J. Biol. Chem. 2001, 276, 2790 Condensation and commentary by Alexander Bucka and Andrzej Stasiak, Universite ´ de Lausanne, Switzerland Purpose of the Study To demonstrate that positive torsional strain generated during DNA replication can lead to reversals of replication forks and, consequently can result in the formation of four-way DNA junctions

Paclitaxel-eluting biodegradable synthetic vascular prostheses: a step towards reduction of neointima formation?

BACKGROUND: Clinical small-caliber vascular prostheses are unsatisfactory. Reasons for failure are early thrombosis and late intimal hyperplasia. We thus prepared biodegradable small-caliber vascular prostheses using electrospun polycaprolactone (PCL) with slow-releasing paclitaxel (PTX), an antiproliferative drug. METHODS AND RESULTS: PCL solutions containing PTX were used to prepare nonwoven nanofibre-based 2-mm ID prostheses. Mechanical morphological properties and drug loading, distribution, and release were studied in vitro. Infrarenal abdominal aortic replacement was carried out with nondrug-loaded and drug-loaded prostheses in 18 rats and followed for 6 months. Patency, stenosis, tissue reaction, and drug effect on endothelialization, vascular remodeling, and neointima formation were studied in vivo. In vitro prostheses showed controlled morphology mimicking extracellular matrix with mechanical properties similar to those of native vessels. PTX-loaded grafts with suitable mechanical properties and controlled drug-release were obtained by factorial design. In vivo, both groups showed 100% patency, no stenosis, and no aneurysmal dilatation. Endothelial coverage and cell ingrowth were significantly reduced at 3 weeks and delayed at 12 and 24 weeks in PTX grafts, but as envisioned, neointima formation was significantly reduced in these grafts at 12 weeks and delayed at 6 months. CONCLUSIONS: Biodegradable, electrospun, nanofibre, polycaprolactone prostheses are promising because in vitro they maintain their mechanical properties (regardless of PTX loading), and in vivo show good patency, reendothelialize, and remodel with autologous cells. PTX loading delays endothelialization and cellular ingrowth. Conversely, it reduces neointima formation until the end point of our study and thus may be an interesting option for small caliber vascular grafts.

Desenvolupament en Network Simulator 2: protocol de migració per simular agents mòbils

Avui en dia, estem assistint a una expansió de la tecnologia d’agents mòbils i noves aplicacions basades en aquesta s’estan obrint pas constantment. Les aplicacions han de demostrar la seva viabilitat sobretot en entorns heterogenis i complexos com les xarxes MANET. En aquest projecte es desenvolupa un sistema per simular el comportament dels agents mòbils, ampliant l’actual simulador de xarxa NS2, i també es comprova la viabilitat de l’implementació de l’ETTMA pel triatge de víctimes en situacions d’emergència.

Sincere Lobby Formation

This paper analyzes endogenous lobbying over a unidimensional policy issue. Individuals differ in policy preferences and decide either to join one of two opposite interest lobbies or not to take part in lobbying activities. Once formed, lobbies make contributions to the incumbent government in exchange for a policy favor as in a common-agency model. A "sincere-lobby-formation" condition for equilibrium is introduced: an individual joins a lobby if their gain from the policy change that this lobby might achieve exceeds a contribution fee. Thus, an equilibrium occurs only if no lobby member would prefer their lobby to cease to exist. I show the existence of an equilibrium with two organized lobbies. Individuals with more extreme preferences are more likely to join lobbying activities. I fi…nd that lobbying somewhat moderates the government's preferences, i.e., it shifts the …final policy in favor of individuals who are initially disadvantaged by the government's pro- or anti-policy preferred position. Under a utilitarian government, however, lobbying does not affect the fi…nal policy, and political competition results in a socially optimal outcome. JEL classi…cation: D72. Keywords: Sincere lobby formation; common agency; endogenous lobbying.