Threshold effects in price transmission: The case of Brazilian wheat, maize, and soya prices

Recent studies into price transmission have recognized the important role played by transport and transaction costs. Threshold models are one approach to accommodate such costs. We develop a generalized Threshold Error Correction Model to test for the presence and form of threshold behavior in price transmission that is symmetric around equilibrium. We use monthly wheat, maize, and soya prices from the United States, Argentina, and Brazil to demonstrate this model. Classical estimation of these generalized models can present challenges but Bayesian techniques avoid many of these problems. Evidence for thresholds is found in three of the five commodity price pairs investigated.

Competition and dispersal in the pea aphid: clonal variation and correlations across traits

1. The presence of an across-species trade-off between dispersal ability and competitive ability has been proposed as a mechanism that facilitates coexistence. It is not clear if a similar trade-off exists within species. Such a trade-off would constrain the evolution of either trait and, given appropriate selection pressures, promote local adaptation in these traits. 2. This study found substantial levels of heritable variation in competitive ability of the pea aphid, Acyrthosiphon pisum Harris (Homoptera: Aphididae), measured in terms of relative survival when reared with a single clone of the vetch aphid, Megoura viciae Buckton (Homoptera: Aphididae). 3. Pea aphids can move to new patches by either flying (longer distance dispersal) or walking (local dispersal) from plant to plant. There was considerable clonal variation in dispersal ability, measured in terms of the proportion of winged offspring produced, and ability to survive away from their host plant. 4. Winged individuals showed longer off-plant survival times than wingless forms of the same pea aphid clone. 5. There was no evidence of a relationship between clonal competitive ability and either measure of dispersal ability, although the power of the test is limited by the number of pea aphid clones used in the trial. 6. However, there was a positive correlation between clonal fecundity and the proportion of winged offspring produced. Although speculative, it is suggested that clones that are more likely to either overwhelm their host plant or attract higher numbers of natural enemies as a result of having higher fecundity are more likely to produce winged morphs.

Power to the people: working-class demand for household power in 1930s Britain

The 1930s witnessed an intense struggle between gas and electricity suppliers for the working class market, where the incumbent utility—gas—was also a reasonably efficient (and cheaper) General Purpose Technology for most domestic uses. Local monopolies for each supplier boosted substitution effects between fuel types—as alternative fuels constituted the only local competition. Using newly-rediscovered returns from a major national household expenditure survey, we employ geographically-determined instrumental variables, more commonly used in the industrial organization literature, to show that gas provided a significant competitor, tempering electricity prices, while electricity demand was also responsive to marketing initiatives.

Exchange rate pass-through to prices in macrodata: a comparative sensitivity analysis

This paper compares exchange rate pass-through to aggregate prices in the US, Germany and Japan across a number of dimensions. Building on the empirical approaches in the recent literature, our contribution is to perform a thorough sensitivity analysis of pass-through estimates. We find that the econometric method, data frequency and variable proxy employed matter for the precision of details, yet they often agree on some general trends. Thus, pass-through to import prices has declined in the 1990s relative to the 1980s, pass-through to export prices remains country-specific and pass-through to consumer prices is nowadays negligible in all three economies we considered.

The role of competition and state aid policy in financial and monetary law

During the financial crisis, companies and lenders found themselves in distressed situations. Competition authorities across the globe had to deal with controversial issues such as the application of the failing firm defence in merger transactions as well as assessment of emergency aid granted by states. This article considers competition policy in periods of crisis, in particular the failing firm defence in merger control and its state aid policy.