Wage determination in the Spanish industry

In this paper we estimate wage equations for the Spanish industryusing time series data on 85 industrial sectors, which allows us todistinguish between aggregate and sector specific effects in wagedetermination. Industry wages respond mainly to economy wide labourmarket conditions and to a much lesser extent to sector specificproductivity gains. The size of the insider effect has not remainedstable through the sample period. The estimated equations show a strongtransitory effect of unemployment on wages, which is in accordancewith the non--stationarity of the Spanish unemployment rate. Thishysteresis effect seems well accounted for by the sharp rise in theproportion of long term unemployment.

Regulatory ambivalence and the limitations of pharmaceutical policy in Spain

Broadly speaking, pharmaceutical policy in Spain has been unable to control either the price or thevolume of drugs prescribed. Limited attempts have been made to bring together the regulation of thepharmaceutical market and policies, in pursuit of the desired goals of efficiency and quality. Thispaper assesses the regulation of the Spanish pharmaceutical market over the last two decades byexamining regulation and policy and the available empirical evidence on their appreciable effects,and presents recommendations for policy design. Our findings suggest that policies aiming to improveefficiency and quality have not managed to contain costs, while cost-effectiveness is still overlooked.We argue that future policies should encourage broader participation in the decision-making processesand promote a higher degree of competition, especially from generic drugs.

Markers of atherosclerosis and inflammation for prediction of coronary heart disease in older adults.

Although both inflammatory and atherosclerosis markers have been associated with coronary heart disease (CHD) risk, data directly comparing their predictive value are limited. The authors compared the value of 2 atherosclerosis markers (ankle-arm index (AAI) and aortic pulse wave velocity (aPWV)) and 3 inflammatory markers (C-reactive protein (CRP), interleukin-6 (IL-6), and tumor necrosis factor-alpha (TNF-alpha)) in predicting CHD events. Among 2,191 adults aged 70-79 years at baseline (1997-1998) from the Health, Aging, and Body Composition Study cohort, the authors examined adjudicated incident myocardial infarction or CHD death ("hard" events) and "hard" events plus hospitalization for angina or coronary revascularization (total CHD events). During 8 years of follow-up between 1997-1998 and June 2007, 351 participants developed total CHD events (197 "hard" events). IL-6 (highest quartile vs. lowest: hazard ratio = 1.82, 95% confidence interval: 1.33, 2.49; P-trend < 0.001) and AAI (AAI </= 0.9 vs. AAI 1.01-1.30: hazard ratio = 1.57, 95% confidence interval: 1.14, 2.18) predicted CHD events above traditional risk factors and modestly improved global measures of predictive accuracy. CRP, TNF-alpha, and aPWV had weaker associations. IL-6 and AAI accurately reclassified 6.6% and 3.3% of participants, respectively (P's </= 0.05). Results were similar for "hard" CHD, with higher reclassification rates for AAI. IL-6 and AAI are associated with future CHD events beyond traditional risk factors and modestly improve risk prediction in older adults.

Bubbly collateral and economic activity

This paper develops a model of the bubbly economy and uses it to study the effects of bailoutpolicies. In the bubbly economy, weak enforcement institutions do not allow firms to pledge futurerevenues to their creditors. As a result, "fundamental" collateral is scarce and this impairs the intermediationprocess that transforms savings into capital. To overcome this shortage of "fundamental"collateral, the bubbly economy creates "bubbly" collateral. This additional collateral supports anintricate array of intra- and inter-generational transfers that allow savings to be transformed intocapital and bubbles. Swings in investor sentiment lead to fluctuations in the amount of bubblycollateral, giving rise to bubbly business cycles with very rich and complex dynamics.Bailout policies can affect these dynamics in a variety of ways. Expected bailouts provideadditional collateral and expand investment and the capital stock. Realized bailouts reduce thesupply of funds and contract investment and the capital stock. Thus, bailout policies tend to fosterinvestment and growth in normal times, but to depress investment and growth during crisis periods.We show how to design bailout policies that maximize various policy objectives.