Labor markets and monetary policy: A new-Keynesian model with unemployement

We construct a utility-based model of fluctuations, with nominal rigidities andunemployment, and draw its implications for the unemployment-inflation trade-off and for the conduct of monetary policy.We proceed in two steps. We first leave nominal rigidities aside. We show that,under a standard utility specification, productivity shocks have no effect onunemployment in the constrained efficient allocation. We then focus on theimplications of alternative real wage setting mechanisms for fluctuations in un-employment. We show the role of labor market frictions and real wage rigiditiesin determining the effects of productivity shocks on unemployment.We then introduce nominal rigidities in the form of staggered price setting byfirms. We derive the relation between inflation and unemployment and discusshow it is influenced by the presence of labor market frictions and real wagerigidities. We show the nature of the tradeoff between inflation and unemployment stabilization, and its dependence on labor market characteristics. We draw the implications for optimal monetary policy.

With a bang, not a whimper: Pricking Germany's "stock market bubble" in 1927 and the slide into depression

In May 1927, the German central bank intervenedindirectly to reduce lending to equity investors.The crash that followed ended the only stockmarket boom during Germany s relative stabilization 1924-28. This paper examines thefactors that lead to the intervention as well asits consequences. We argue that genuine concernabout the exuberant level of the stock market,in addition to worries about an inflow offoreign funds, tipped the scales in favour ofintervention. The evidence strongly suggeststhat the German central bank under HjalmarSchacht was wrong to be concerned aboutstockprices-there was no bubble. Also, theReichsbank was mistaken in its belief thata fall in the market would reduce theimportance of short-term foreign borrowing,and help to ease conditions in the money market.The misguided intervention had important realeffects. Investment suffered, helping to tipGermany into depression.

Optimal monetary and fiscal policy in a currency union

We lay out a tractable model for fiscal and monetary policy analysis in a currency union, and study its implications for the optimal design of such policies. Monetary policy is conducted by a common central bank, which sets the interest rate for the union as a whole. Fiscal policy is implemented at the countrylevel, through the choice of government spending. The model incorporates country-specific shocks and nominal rigidities. Under our assumptions, the optimal cooperative policy arrangement requires that inflation be stabilized at the union level by the common central bank, while fiscal policy is used by each country for stabilization purposes. By contrast, when the fiscal authorities act in a non-coordinated way, their joint actions lead to a suboptimal outcome, and make the common central bank face a trade-off between inflation and output gap stabilization at the union level.

Firm-specific investment, sticky prices and the Taylor principle

According to the Taylor principle a central bank should adjust the nominal interest rate by more than one-for-one in response to changes in current inflation. Most of the existing literature supports the view that by following this simple recommendation a central bank can avoid being a source of unnecessary fluctuations in economic activity. The present paper shows that this conclusion is not robust with respect to the modelling of capital accumulation. We use our insights to discuss the desirability of alternative interest raterules. Our results suggest a reinterpretation of monetary policy under Volcker and Greenspan: The empirically plausible characterization of monetary policy can explain the stabilization of macroeconomic outcomes observed in the early eighties for the US economy. The Taylor principle in itself cannot.

Economic booms, trade deficits and economic policy

Many economic booms have been accompanied by realexchange rate appreciations, large trade defcits -whichhave sometimes persisted after the return to the initialexchange rate parity- and a deteriorating traded sector.Those circumstances have typically raised the questionof the de-sirability of some stabilization policy. We show that the dynamics induced by an expectedproductivity shock in an economy where the capital stockis non-mobile across sectors, match those circumstances.Furthermore, we obtain that credit market imperfectionstend to exacerbate trade deficits, and to cause aninefficient capacity reduction in the traded sector.Some stabilization policies are explored.

Update on skin cancer incidence and mortality in Europe

The epidemiology of skin cancer shows interplay between host susceptibility, (ultraviolet) environment, socioeconomical conditions and behavioural patterns. Its etiology is not yet fully elucidated and reveals intriguing questions. Fair-skinned populations have experienced over the last 60 years a rapid increase in the incidence of melanoma which is unparalleled by any other cancer, although signs of levelling off and stabilization in incidence have recently been observed in some countries. Despite many primary prevention and early detection campaigns over the last decades in Europe, decreases in melanoma mortality are modest and limited to a few countries. Further, reduction in the incidence of thick melanomas has not yet been evidenced. In this presentation, drivers for the incidence and mortality trends of skin cancer, with a strong focus on melanoma, its most lethal form, will be discussed.

Generation of the primary hair follicle pattern.

Hair follicles are spaced apart from one another at regular intervals through the skin. Although follicles are predominantly epidermal structures, classical tissue recombination experiments indicated that the underlying dermis defines their location during development. Although many molecules involved in hair follicle formation have been identified, the molecular interactions that determine the emergent property of pattern formation have remained elusive. We have used embryonic skin cultures to dissect signaling responses and patterning outcomes as the skin spatially organizes itself. We find that ectodysplasin receptor (Edar)-bone morphogenetic protein (BMP) signaling and transcriptional interactions are central to generation of the primary hair follicle pattern, with restriction of responsiveness, rather than localization of an inducing ligand, being the key driver in this process. The crux of this patterning mechanism is rapid Edar-positive feedback in the epidermis coupled with induction of dermal BMP4/7. The BMPs in turn repress epidermal Edar and hence follicle fate. Edar activation also induces connective tissue growth factor, an inhibitor of BMP signaling, allowing BMP action only at a distance from their site of synthesis. Consistent with this model, transgenic hyperactivation of Edar signaling leads to widespread overproduction of hair follicles. This Edar-BMP activation-inhibition mechanism appears to operate alongside a labile prepattern, suggesting that Edar-mediated stabilization of beta-catenin active foci is a key event in determining definitive follicle locations.

Insects associated with the composting process of solid urban waste separated at the source

Sarcosaprophagous macroinvertebrates (earthworms, termites and a number of Diptera larvae) enhance changes in the physical and chemical properties of organic matter during degradation and stabilization processes in composting, causing a decrease in the molecular weights of compounds. This activity makes these organisms excellent recyclers of organic matter. This article evaluates the succession of insects associated with the decomposition of solid urban waste separated at the source. The study was carried out in the city of Medellin, Colombia. A total of 11,732 individuals were determined, belonging to the classes Insecta and Arachnida. Species of three orders of Insecta were identified, Diptera, Coleoptera and Hymenoptera. Diptera corresponding to 98.5% of the total, was the most abundant and diverse group, with 16 families (Calliphoridae, Drosophilidae, Psychodidae, Fanniidae, Muscidae, Milichiidae, Ulidiidae, Scatopsidae, Sepsidae, Sphaeroceridae, Heleomyzidae, Stratiomyidae, Syrphidae, Phoridae, Tephritidae and Curtonotidae) followed by Coleoptera with five families (Carabidae, Staphylinidae, Ptiliidae, Hydrophilidae and Phalacaridae). Three stages were observed during the composting process, allowing species associated with each stage to be identified. Other species were also present throughout the whole process. In terms of number of species, Diptera was the most important group observed, particularly Ornidia obesa, considered a highly invasive species, and Hermetia illuscens, both reported as beneficial for decomposition of organic matter.

Functional response of Telenomus remus Nixon(Hymenoptera, Scelionidae) to Spodoptera frugiperda (J. E. Smith) (Lepidoptera, Noctuidae) eggs: effect of female age

Functional response of Telenomus remus Nixon (Hymenoptera, Scelionidae) to Spodoptera frugiperda (J. E. Smith) (Lepidoptera, Noctuidae) eggs: effect of female age. Functional response of 24-h and 48-h-old Telenomus remus adults was studied on Spodoptera frugiperda eggs. The study was carried out in climatic chamber regulated at 25 ± 1°C, 70 ± 10% RH and 12:12h (L: D). Females of T. remus were honey fed and individualized in glass vials along with 25, 50, 75, 100, 150, 200, 250 or 300 eggs of S. frugiperda for 24 h. Complete randomized design with ten replications was adopted. The parameters evaluated to construct the functional response curve were daily average parasitism, searching rate and oviposition time. It was observed that the higher the egg density, the higher the parasitism for 24-h and 48-h-old females although there was a tendency of parasitism stabilization at 150-egg density. The results showed a type II functional response curve for both 24-h and 48-h-old female.

The science of monetary policy: A new Keynesian perspective

This paper reviews the recent literature on monetary policy rules. We exposit the monetary policy design problem within a simple baselinetheoretical framework. We then consider the implications of adding various real world complications. Among other things, we show that the optimal policy implicitly incorporates inflation targeting. Wealso characterize the gains from making credible commitments to fightinflation. In contrast to conventional wisdom, we show that gains from commitment may emerge even in the central bank is not trying toinadvisedly push output above its natural level. We also consider theimplications of frictions such as imperfect information.

Which inflation to target? A small open economy with sticky wages indexed to past inflation

In a closed economy context there is common agreement on price inflation stabilization being one of the objects of monetary policy. Moving to an open economy context gives rise to the coexistence of two measures of inflation: domestic inflation (DI) and consumer price inflation (CPI). Which one of the two measures should be the target variable? This is the question addressed in this paper. In particular, I use a small open economy model to show that once sticky wages indexed to past CPI inflation are introduced, a complete inward looking monetary policy is no more optimal. I first, derive a loss function from a secondorder approximation of the utility function and then, I compute the fully optimalmonetary policy under commitment. Then, I use the optimal monetary policy as a benchmark to compare the performance of different monetary policy rules. The main result is that once a positive degree of indexation is introduced in the model the rule performing better (among the Taylor type rules considered) is the one targeting wage inflation and CPI inflation. Moreover this rule delivers results very close to the one obtained under the fully optimal monetary policy with commitment.

Recurrent hyperinflations and learning

This paper uses a model of boundedly rational learning to accountfor the observations of recurrent hyperinflations in the lastdecade. We study a standard monetary model where the fullyrational expectations assumption is replaced by a formaldefinition of quasi-rational learning. The model under learningis able to match remarkably well some crucial stylized factsobserved during the recurrent hyperinflations experienced byseveral countries in the 80's. We argue that, despite being asmall departure from rational expectations, quasi-rationallearning does not preclude falsifiability of the model and itdoes not violate reasonable rationality requirements.

Ostéo-arthropathie hypertrophiante révélatrice d'un hémangio-endothéliome épithélioïde multifocal hépatique et pulmonaire [Hypertrophic osteoarthropathy disclosing hepatic and pulmonary multifocal epithelioid hemangioendothelioma]

Epithelioid hemangioendothelioma is a rare, low-grade vascular malignancy reported for the first time in 1982 by Weiss and Enzinger. It involves one or, more rarely, several organs. We report a case involving the lungs and liver, in which the first manifestation was symptomatic hypertrophic osteoarthropathy. Findings four years after the diagnosis included very slow tumor spread, resolution of symptoms, and stabilization of radiological changes.

Biosphere/lithosphere interface : microbially-mediated CaCO3 precipitation in hypersaline and freshwater environments

Abstract: Microbial mats very efficiently cycle elements, such as C, 0, N, S and H, which makes them key players of redox processes at the biosphere-lithosphere interface. They are characterized by high metabolic activities and high turnover rates (production and consumption) of biomass, which mainly consists of cell material and of extracellular organic matter (EOM). The EOM forms a matrix, embedding the microbial cells and fulfilling various functions within the microbial mat, including: mat attachment to surfaces; creation of micro-domains within the mat; physical stabilization under hy- drodynamic stress and the protection of the cells in multiple other stress conditions. EOM mainly consists of polysaccharides, amino acids, and a variety of chemical func-tional groups {e.g., -C00H, - SH -OH). These groups strongly bind cations such as Ca2+ and Mg2+ and thus exert a strong control on carbonate mineral formation within the microbial mat. A feedback mechanism between community metabolisms, their prod¬ucts, and the surrounding physicochemical microenvironment thus influences the de¬gree of carbonate saturation favoring either carbonate precipitation or dissolution. We investigated the driving forces and mechanisms of microbialite formation in the Sari ne River, FR, Switzerland, the hypersaline lake, Big Pond, Bahamas and in labo¬ratory experiments. The two fundamentally different natural systems allowed us to compare the geochemical conditions and microbial metabolisms, necessary for car¬bonate formation in microbial mats. Although carbonates are oversaturated in both environments, precipitation does not occur on physicochemical substrates (i.e. out¬side the microbial mats). In the Sarine a high crystal nucleation threshold exceeds the carbonate saturation, despite the high carbonate alkalinity in the water column. Cyanobacterial photosynthesis strongly locally enhances the carbonate alkalinity, whereas the EOM attract and immobilize calcium, which increases the saturation state and finally leads to carbonate precipitation within the EOM (in this case the cyanobacterial sheath) as nucleation template. In Big Pond, the presence of calcium- chelating anions (i.e. sulfate) and EOM, as well as the presence of magnesium, lowers the calcium activity in the water column and mat, and thus inhibits carbonate pre¬cipitation. Coupled with other heterotrophic metabolisms, sulfate reduction uses the EOM as carbon source, degrading it. The resulting EOM consumption creates alkalin¬ity, releases calcium and consumes sulfate in mat-micro domains, which leads to the formation of carbonate layers at the top of the microbial mat. Résumé: Interface biosphère/lithosphère: médiation microbienne de la précipitation de CaC03 dans des environnements en eaux douces et hypersalines Les tapis microbiens engendrent une circulation très efficace des éléments, tels que C, 0, N, S et H, ce qui en fait des acteurs clé pour les processus d'oxydoréduction à l'inter¬face biosphère-lithosphère. Ils sont caractérisés par des taux élevés d'activité méta¬bolique, ainsi que par la production et la consommation de biomasse, principalement constituée de cellules microbiennes et de matière organique extracellulaire (MOE). Dans un tapis microbien, les cellules microbiennes sont enveloppées par une matrice de MOE qui a différentes fonctions dont l'attachement du tapis aux surfaces, la créa¬tion de micro-domaines dans le tapis, la stabilisation physique en situation de stress hydrodynamique, et la protection des cellules dans de multiples autres conditions de stress. La MOE se compose principalement de polysaccharides, d'acides aminés, et d'une variété de groupes fonctionnels chimiques (par exemple, COOH, -SH et -OH). Ces groupes se lient fortement aux cations, tels que Ca2+ et Mg2+, et exercent ainsi un contrôle fort sur la formation de CaC03 dans le tapis microbien. Un mécanisme de rétroaction, entre les métabolismes de la communauté microbienne, leurs produits, et le microenvironnement physico-chimique, influence le degré de saturation de car¬bonate, favorisant soit leur précipitation, soit leur dissolution. Nous avons étudié le moteur et les mécanismes de minéralisation dans des tapis de la Sarine, FR, Suisse et du lac hypersalin, Big Pond, aux Bahamas, ainsi que durant des expériences en laboratoire. Les deux systèmes naturels, fondamentalement dif¬férents, nous ont permis de comparer les conditions géochimiques et les métabolis¬mes nécessaires à la formation des carbonates dans des tapis microbiens. Bien que les carbonates soient sursaturés dans les deux environnements, la précipitation ne se produit pas sur des substrats physico-chimiques (en dehors du tapis microbien). Dans la Sarine, malgré un taux d'alcalinité élevé, les valeurs de seuil pour la nucléa- tion de carbonates sont plus hautes que la saturation du carbonate. La photosynthèse cyanobactérienne augmente localement l'alcalinité, alors que la MOE attire et immo¬bilise le calcium, ce qui augmente l'état de saturation et conduit finalement à la pré¬cipitation des carbonates, en utilisant la MOE comme substrat de nucléation. À Big Pond, la présence de chélateurs de calcium, notamment les anions (p.ex. le sulfate) et la MOE, ainsi que la présence de magnésium, réduit l'activité du calcium et inhibe en conséquence la précipitation des carbonates. Couplée avec d'autres métabolismes hétérotrophes, la réduction des sulfates utilise la MOE comme source de carbone, en la dégradant. Cette consommation de MOE crée l'alcalinité, consomme des sulfates et libère du calcium dans des micro-domaines, conduisant à la formation de couches de carbonates dans le haut du tapis microbien.

Surviving Sepsis Campaign: international guidelines for management of severe sepsis and septic shock: 2008.

OBJECTIVE: To provide an update to the original Surviving Sepsis Campaign clinical management guidelines, "Surviving Sepsis Campaign guidelines for management of severe sepsis and septic shock," published in 2004. DESIGN: Modified Delphi method with a consensus conference of 55 international experts, several subsequent meetings of subgroups and key individuals, teleconferences, and electronic-based discussion among subgroups and among the entire committee. This process was conducted independently of any industry funding. METHODS: We used the GRADE system to guide assessment of quality of evidence from high (A) to very low (D) and to determine the strength of recommendations. A strong recommendation indicates that an intervention's desirable effects clearly outweigh its undesirable effects (risk, burden, cost), or clearly do not. Weak recommendations indicate that the tradeoff between desirable and undesirable effects is less clear. The grade of strong or weak is considered of greater clinical importance than a difference in letter level of quality of evidence. In areas without complete agreement, a formal process of resolution was developed and applied. Recommendations are grouped into those directly targeting severe sepsis, recommendations targeting general care of the critically ill patient that are considered high priority in severe sepsis, and pediatric considerations. RESULTS: Key recommendations, listed by category, include: early goal-directed resuscitation of the septic patient during the first 6 hrs after recognition (1C); blood cultures prior to antibiotic therapy (1C); imaging studies performed promptly to confirm potential source of infection (1C); administration of broad-spectrum antibiotic therapy within 1 hr of diagnosis of septic shock (1B) and severe sepsis without septic shock (1D); reassessment of antibiotic therapy with microbiology and clinical data to narrow coverage, when appropriate (1C); a usual 7-10 days of antibiotic therapy guided by clinical response (1D); source control with attention to the balance of risks and benefits of the chosen method (1C); administration of either crystalloid or colloid fluid resuscitation (1B); fluid challenge to restore mean circulating filling pressure (1C); reduction in rate of fluid administration with rising filing pressures and no improvement in tissue perfusion (1D); vasopressor preference for norepinephrine or dopamine to maintain an initial target of mean arterial pressure > or = 65 mm Hg (1C); dobutamine inotropic therapy when cardiac output remains low despite fluid resuscitation and combined inotropic/vasopressor therapy (1C); stress-dose steroid therapy given only in septic shock after blood pressure is identified to be poorly responsive to fluid and vasopressor therapy (2C); recombinant activated protein C in patients with severe sepsis and clinical assessment of high risk for death (2B except 2C for post-operative patients). In the absence of tissue hypoperfusion, coronary artery disease, or acute hemorrhage, target a hemoglobin of 7-9 g/dL (1B); a low tidal volume (1B) and limitation of inspiratory plateau pressure strategy (1C) for acute lung injury (ALI)/acute respiratory distress syndrome (ARDS); application of at least a minimal amount of positive end-expiratory pressure in acute lung injury (1C); head of bed elevation in mechanically ventilated patients unless contraindicated (1B); avoiding routine use of pulmonary artery catheters in ALI/ARDS (1A); to decrease days of mechanical ventilation and ICU length of stay, a conservative fluid strategy for patients with established ALI/ARDS who are not in shock (1C); protocols for weaning and sedation/analgesia (1B); using either intermittent bolus sedation or continuous infusion sedation with daily interruptions or lightening (1B); avoidance of neuromuscular blockers, if at all possible (1B); institution of glycemic control (1B) targeting a blood glucose < 150 mg/dL after initial stabilization ( 2C ); equivalency of continuous veno-veno hemofiltration or intermittent hemodialysis (2B); prophylaxis for deep vein thrombosis (1A); use of stress ulcer prophylaxis to prevent upper GI bleeding using H2 blockers (1A) or proton pump inhibitors (1B); and consideration of limitation of support where appropriate (1D). Recommendations specific to pediatric severe sepsis include: greater use of physical examination therapeutic end points (2C); dopamine as the first drug of choice for hypotension (2C); steroids only in children with suspected or proven adrenal insufficiency (2C); a recommendation against the use of recombinant activated protein C in children (1B). CONCLUSION: There was strong agreement among a large cohort of international experts regarding many level 1 recommendations for the best current care of patients with severe sepsis. Evidenced-based recommendations regarding the acute management of sepsis and septic shock are the first step toward improved outcomes for this important group of critically ill patients.