Job dynamics, correlated shocks and wage profiles

We generalize the Mortensen-Pissarides (1994) model of the labor marketwith a more realistic structure for the stochastic process of theshocks to the worker-firm match. In this way we can acommodate theempirical observation that hazard rates of job termination decrease andaverage wages increase with job tenure. Besides being able to fit bettersome observables of the model, the changes we introduce are nontrivialfor the analysis of policies as well.

Effect of ethanol on energy expenditure.

The thermogenic response induced by ethanol ingestion in humans has not been extensively studied. This study was designed to determine the thermic effect of ethanol added to a normal diet in healthy nonalcoholic subjects, using indirect calorimetry measurements over a 24-h period in a respiration chamber. The thermic effect of ethanol was also measured when ethanol was ingested in the fasting state, using a ventilated hood system during a 5-h period. Six subjects ingested 95.6 +/- 1.8 (SE) g ethanol in 1 day partitioned over three meals; there was a 5.5 +/- 1.2% increase in 24-h energy expenditure compared with a control day in which all conditions were identical except that no ethanol was consumed. The calculated ethanol-induced thermogenesis (EIT) was 22.5 +/- 4.7% of the ethanol energy ingested. Ingestion of 31.9 +/- 0.6 g ethanol in the fasting state led to a 7.4 +/- 0.6% increase in energy expenditure over baseline values, and the calculated EIT was 17.1 +/- 2.2%. It is concluded that in healthy nonalcoholic adults ethanol elicits a thermogenic response equal to approximately 20% of the ethanol energy. Thus the concept of the apparently inefficient utilization of ethanol energy is supported by these results which show that only approximately 80% of the ethanol energy is used as metabolizable energy for biochemical processes in healthy nonalcoholic moderate ethanol consumers.

Economic shocks and civil conflict: A comment

Miguel, Satyanath, and Sergenti (2004) argue that lowerrainfall levels and negative rainfall shocks increase conflictrisk in Sub-Saharan Africa. This conclusion rests on theirfinding of a negative correlation between conflict in t andrainfall growth between t-1 and t-2. I argue that this findingis driven by a positive correlation between conflict in t andrainfall levels in t-2. If lower rainfall levels or negativerainfall shocks increased conflict, one might have expectedMSS s finding to reflect a negative correlation betweenconflict in t and rainfall levels in t-1. In the latest data,conflict is unrelated to rainfall.

The macroeconomic effects of oil price shocks: Why are the 2000s so different from the 1970s?

We characterize the macroeconomic performance of a set of industrialized economies in the aftermath of the oil price shocks of the 1970s and of the last decade, focusing on the differences across episodes. We examine four different hypotheses for the mild effects on inflation and economic activity of the recent increase in the price of oil: (a) good luck (i.e. lack of concurrent adverse shocks), (b) smaller share of oil in production, (c) more flexible labor markets, and (d) improvements in monetary policy. Weconclude that all four have played an important role.

Variability of resting energy expenditure in healthy volunteers during fasting and continuous enteral feeding.

The magnitude of variability in resting energy expenditure (REE) during the day was assessed in nine healthy young subjects under two nutritional conditions: 1) mixed nutrient (53% carbohydrate, 30% fat, 17% protein) enteral feeding at an energy level corresponding to 1.44 REE; and 2) enteral fasting, with only water allowed. In each subject, six 30-min measurements of REE were performed using indirect calorimetry (hood system) at 90-min intervals from 9 AM to 5 PM. The mean REE and respiratory quotient were significantly (p less than .01) greater during feeding than during fasting (1.08 +/- 0.07 [SEM] vs. 1.00 +/- 0.06 kcal/min and 0.874 +/- 0.007 vs. 0.829 +/- 0.008 kcal/min, respectively). Mean postprandial thermogenesis was 4.9 +/- 0.4% of metabolizable energy administered. The intraindividual variability of REE throughout the day, expressed as the coefficient of variation, ranged from 0.7% to 2.0% in the fasting condition and from 1.2% to 4.1% in the feeding condition. There was no significant difference between the REE measured in the morning and that determined in the afternoon.

The elusive costs and the immaterial gains of fiscal contraints

We study whether and how fiscal restrictions alter the business cycle features macrovariables for a sample of 48 US states. We also examine the 'typical' transmission properties of fiscal disturbances and the implied fiscal rules of states with different fiscal restrictions. Fiscal constraints are characterized with a number of indicators. There are similarities in second moments of macrovariables and in the transmission properties of fiscal shocks across states with different fiscal constraints. The cyclical response of expenditure differs in size and sometimes in sign, but heterogeneity within groups makes point estimates statistically insignificant. Creative budget accounting isresponsible for the pattern. Implications for the design of fiscal rules and thereform of the Stability and Growth Pact are discussed.

Optimal law enforcement under asymmetric information

In this paper, we focus on the problem created by asymmetric informationabout the enforcer's (agent's) costs associated to enforcement expenditure. This adverse selection problem affects optimal law enforcement because a low cost enforcer may conceal its information by imitating a high cost enforcer, and must then be given a compensation to be induced to reveal its true costs. The government faces a trade-off between minimizing the enforcer's compensation and maximizing the net surplus of harmful acts. As a consequence, the probability of apprehension and punishment is usually reduced leading to more offenses being committed. We show that asymmetry of information does not affect law enforcement as long as raising public funds is costless. The consideration of costly raising of public funds permits to establish the positive correlation between asymmetry of information between government and enforcers andthe crime rate.

Banks, government bonds, and default: what do the data say?

We use data from Bankscope to analyze the holdings of public bonds by over 18,000 banks located in 185 countries and the role of these bonds in 18 sovereign debt crises over the period 1998-2012. We find that: (i) banks hold a sizeable share of their assets in government bonds (about 9% on average), particularly in less financially developed countries; (ii) during sovereign crises, banks on average increase their bondholdings by 1% of their assets, but this increase is concentrated among larger and more profitable banks, and; (iii) the correlation between a bank's holdings of public bonds and its future loans is positive in normal times, but turns negative during defaults. A 10% increase in bank bond-holdings during default is associated with a 3.2% reduction in future loans, and bonds bought in normal times account for 75% of this effect. Our results are consistent with the view that there is a liquidity benefit for banks to hold public bonds in normal times, which is critical for understanding bank fragility during sovereign crises.

State Government E85 Use Plan, December 31, 2007

Governor Culver issued Executive Order 3 on June 21st, 2007. The Executive Order directs that at least 60 percent of fuel purchases in state flexible fuel vehicles be E85 by June 30, 2009. The Order also directed “the Director of the Office of Energy Independence, in consultation with the Director of Administrative Services, shall submit a State Government E85 Use Plan.” The following recommendations are immediate actions that can be taken to ensure that the state reaches the Governor’s goal of 60 percent E85 fuel use by June 30, 2009

Iowa Leading Indicators Index, February 2009

The Iowa Leading Indicators Index (ILII) is a tool for monitoring the future direction of the Iowa economy and State revenues. Its eight components include an agricultural futures price index, an Iowa stock market index, average weekly manufacturing hours in Iowa, initial unemployment claims in Iowa, an Iowa new orders index, diesel fuel consumption in Iowa, residential building permits in Iowa, and the national yield spread.

Iowa Leading Indicators Index, June 2009

The Iowa Leading Indicators Index (ILII) is a tool for monitoring the future direction of the Iowa economy and State revenues. Its eight components include an agricultural futures price index, an Iowa stock market index, average weekly manufacturing hours in Iowa, initial unemployment claims in Iowa, an Iowa new orders index, diesel fuel consumption in Iowa, residential building permits in Iowa, and the national yield spread.

Governor's Task Force on Efficiencies and Cost-Effectiveness in Iowa State Government,Final Report, December 1983

A special task force was formed and worked through its various committees to uncover and investigate possible areas for cutting costs and saving money in State Government operations. A total of 81 recommendations are made in this report, with potential savings of over $32 million during the next several years.