Finance and Balanced Growth

The Uzawa (1961) theorem applied to finance and growthsuggests that a long-run positive correlation between financial efficiency and depth is only present when variations in the extent of access to financial services are considered. Improvements in financial efficiency can lead to new capital augmenting technologies along the balanced path, but only improvements in financial efficiency directed towards labor can change the rate of growth in the long-run. These findings suggest ways to understand some of the more nuanced relationships between finance and growth observed in the data and point in a number of directions for future research.

The Market for "Rough Diamonds": Information, Finance and Wage Inequality

During the past four decades both between and within group wage inequality increased significantly in the US. I provide a microfounded justification for this pattern, by introducing private employer learning in a model of signaling with credit constraints. In particular, I show that when financial constraints relax, talented individuals can acquire education and leave the uneducated pool, this decreases unskilled inexperienced wages and boosts wage inequality. This explanation is consistent with US data from 1970 to 1997, indicating that the rise of the skill and the experience premium coincides with a fall in unskilled-inexperienced wages, while at the same time skilled or experienced wages do not change much. The model accounts for: (i) the increase in the skill premium despite the growing supply of skills; (ii) the understudied aspect of rising inequality related to the increase in the experience premium; (iii) the sharp growth of the skill premium for inexperienced workers and its moderate expansion for the experienced ones; (iv) the puzzling coexistence of increasing experience premium within the group of unskilled workers and its stable pattern among the skilled ones. The results hold under various robustness checks and provide some interesting policy implications about the potential conflict between inequality of opportunity and substantial economic inequality, as well as the role of minimum wage policy in determining the equilibrium wage inequality.

The response of the external finance premium in Asian corporate bond markets to financial characteristics, financial constraints and two financial crises

Empirical investigation of the external finance premium has been conducted on the margin between internal finance and bank borrowing or equities but little attention has been given to corporate bonds, especially for the emerging Asian market. In this paper, we hypothesize that balance sheet indicators of creditworthiness could affect the external finance premium for bonds as they do for premia in other markets. Using bond-specific and firm-specific data for China, Hong Kong, Indonesia, Korea, Philippines, Singapore and Thailand during 1995-2009 we find that firms with better financial health face lower external finance premia in all countries. When we introduce firm-level heterogeneity, we show that financial variables appear to be both statistically and quantitatively more important for financially constrained firms. Finally, when we examine the effects of the 1997-98 Asian crisis and the 2007-09 global financial crisis, we find that the sensitivity of the premium is greater for constrained firms during the Asian crisis compared to other times.

Policy initiatives and firms’ access to external finance: Evidence from a panel of emerging Asian economies

This paper analyses the impact of policy initiatives co-ordinated by Asian national governments on firms' access to external finance, using a unique firm-level database of eight Asian countries- Hong Kong SAR, Indonesia, Korea, Malaysia, Philippines, Singapore, Taiwan and Thailand over the period of 1996-2012. Using a difference-indifferences approach and controlling for firm-level and macroeconomic factors, the results show a significant impact of policy on firms' access to external finance. After splitting firms into constrained and unconstrained, using several criteria, the results document that unconstrained firms benefited significantly in obtaining external finance, compared to their constrained counterparts. Finally, we show that the increase in access to external finance after the policy initiative helped firms to raise their investment spending, especially for unconstrained firms.

Term Structure Dynamics, Macro-Finance Factors and Model Uncertainty

This paper extends the Nelson-Siegel linear factor model by developing a flexible macro-finance framework for modeling and forecasting the term structure of US interest rates. Our approach is robust to parameter uncertainty and structural change, as we consider instabilities in parameters and volatilities, and our model averaging method allows for investors' model uncertainty over time. Our time-varying parameter Nelson-Siegel Dynamic Model Averaging (NS-DMA) predicts yields better than standard benchmarks and successfully captures plausible time-varying term premia in real time. The proposed model has significant in-sample and out-of-sample predictability for excess bond returns, and the predictability is of economic value.

The rapid urinary drug toxicology screen in the emergency room: a useful tool ?

Intoxications are a frequent problem in the ER. In the vast majorityof cases, supportive treatment is sufficient. Severe intoxications withunknown agents are considered an indication for a urinary drug screen,and are recommended by several toxicology centers. However, theirusefulness for patient management remains uncertain.Study objectives: Evaluation of the impact of a urinary drug screen(Biosite Triage TOX Drug Screen) testing 11 substances(acetaminophen, amphetamines, methamphetamines, barbiturates,benzodiazepines, cocaïne, methadone, opioids, phencyclidine,cannabis, tricyclic antidepressants) on initial adult patient managementin the emergency department of a university hospital with ~35.000annual admissions.Methods: Observational retrospective analysis of all tests performedbetween 09/2009 and 09/2010. A test utility was defined as useful if itresulted in the administration of a specific antidote (Flumazenil/Naloxone), the use of a quantitative confirmatory toxicologic test, or achange in patient's disposition.Results: 57 tests were performed. Patient age was 32 ± 11 (SD) years;58% were men; 30% were also intoxicated with alcohol. Two patientsdied (3.5%): the first one of a diphenhydramin overdose, the other of ahypertensive intracerebral hemorrhage believed to be caused cocaineabuse but a negative urine test. Test indications were: 54% firstpsychotic episode; 25% acute respiratory failure; 18% coma; 12%seizure; 11% opioids toxidrome; 7% sympathicomimetic toxidrome; 5%hypotension; 4% ventricular arrhythmia (VT, VF, torsades de pointes)or long QT. 75% of tests were positives for >=1 substance (mean 1.7 ±0.9). 47% of results were unexpected by history. 18% of resultsinfluenced patient management: 7% had a negative test that confirmedthe diagnosis of endogenous psychosis in a first psychotic episode, andallowed transfer to psychiatry; 5% received flumazenil/naloxone;2% had an acetaminophen blood level after a positive screen; finally,4% had an unexpected methadone abuse that required prolongationof hospital stay.Conclusions: A rapid urinary toxicologic screen was seldom used inour emergency department, and its impact on patient managementwas marginal: only one in 6 tests influenced treatment decisions.

Prognostic accuracy of cerebral blood flow measurement by perfusion computed tomography, at the time of emergency room admission, in acute stroke patients.

The purpose of this study was to determine the prognostic accuracy of perfusion computed tomography (CT), performed at the time of emergency room admission, in acute stroke patients. Accuracy was determined by comparison of perfusion CT with delayed magnetic resonance (MR) and by monitoring the evolution of each patient's clinical condition. Twenty-two acute stroke patients underwent perfusion CT covering four contiguous 10mm slices on admission, as well as delayed MR, performed after a median interval of 3 days after emergency room admission. Eight were treated with thrombolytic agents. Infarct size on the admission perfusion CT was compared with that on the delayed diffusion-weighted (DWI)-MR, chosen as the gold standard. Delayed magnetic resonance angiography and perfusion-weighted MR were used to detect recanalization. A potential recuperation ratio, defined as PRR = penumbra size/(penumbra size + infarct size) on the admission perfusion CT, was compared with the evolution in each patient's clinical condition, defined by the National Institutes of Health Stroke Scale (NIHSS). In the 8 cases with arterial recanalization, the size of the cerebral infarct on the delayed DWI-MR was larger than or equal to that of the infarct on the admission perfusion CT, but smaller than or equal to that of the ischemic lesion on the admission perfusion CT; and the observed improvement in the NIHSS correlated with the PRR (correlation coefficient = 0.833). In the 14 cases with persistent arterial occlusion, infarct size on the delayed DWI-MR correlated with ischemic lesion size on the admission perfusion CT (r = 0.958). In all 22 patients, the admission NIHSS correlated with the size of the ischemic area on the admission perfusion CT (r = 0.627). Based on these findings, we conclude that perfusion CT allows the accurate prediction of the final infarct size and the evaluation of clinical prognosis for acute stroke patients at the time of emergency evaluation. It may also provide information about the extent of the penumbra. Perfusion CT could therefore be a valuable tool in the early management of acute stroke patients.

Acute pain in adults admitted to the emergency room: development and implementation of abbreviated guidelines.

AIM: Although acute pain is frequently reported by patients admitted to the emergency room, it is often insufficiently evaluated by physicians and is thus undertreated. With the aim of improving the care of adult patients with acute pain, we developed and implemented abbreviated clinical practice guidelines (CG) for the staff of nurses and physicians in our hospital's emergency room. METHODS: Our algorithm is based upon the practices described in the international literature and uses a simultaneous approach of treating acute pain in a rapid and efficacious manner along with diagnostic and therapeutic procedures. RESULTS: Pain was assessed using either a visual analogue scale (VAS) or a numerical rating scale (NRS) at ER admission and again during the hospital stay. Patients were treated with paracetamol and/or NSAID (VAS/NRS <4) or intravenous morphine (VAS/NRS > or =04). The algorithm also outlines a specific approach for patients with headaches to minimise the risks inherent to a non-specific treatment. In addition, our algorithm addresses the treatment of paroxysmal pain in patients with chronic pain as well as acute pain in drug addicts. It also outlines measures for pain prevention prior to minor diagnostic or therapeutic procedures. CONCLUSIONS: Based on published guidelines, an abbreviated clinical algorithm (AA) was developed and its simple format permitted a widespread implementation. In contrast to international guidelines, our algorithm favours giving nursing staff responsibility for decision making aspects of pain assessment and treatment in emergency room patients.

Inhibition of the renin-angiotensin-aldosterone system: is there room for dual blockade in the cardiorenal continuum?

Antagonism of renin-angiotensin-aldosterone system is exerted through angiotensin-converting enzyme inhibitors, angiotensin receptor antagonists, renin inhibitors and mineralocorticoid receptor antagonists. These drugs have been successfully tested in numerous trials and in different clinical settings. The original indications of renin-angiotensin-aldosterone system blockers have progressively expanded from the advanced stages to the earlier stages of cardiorenal continuum. To optimize the degree of blockade of renin-angiotensin-aldosterone system, dose uptitrations of angiotensin-converting enzyme inhibitors and angiotensin receptor antagonists or the use of a dual blockade, initially identified with the combination of angiotensin-converting enzyme inhibitors and angiotensin receptor antagonists, have been proposed. The data from the Ongoing Telmisartan Alone and in Combination with Ramipril Global Endpoint Trial (ONTARGET) study do not support this specific dual blockade approach. However, the dual blockade of angiotensin-converting enzyme inhibitors/angiotensin receptor antagonists with direct renin inhibitors is currently under investigation while that based on an aldosterone blocker with any of the previous three drugs requires more evidence beyond heart failure. In this review, we revisited potential advantages of dual blockade of renin-angiotensin-aldosterone system in arterial hypertension and diabetes.

Sperrin Lakeland Health & Social Care Trust Community Nursing Project - Evaluation Report on Establishment of a treatment Room Service Bureau (PDF 316 KB)

Sperrin Lakeland Trust's final report on the establishment of a treatment room service bureau. Part of the Department's redesign of community nursing project

Three essays in international finance

Executive Summary The first essay of this dissertation investigates whether greater exchange rate uncertainty (i.e., variation over time in the exchange rate) fosters or depresses the foreign investment of multinational firms. In addition to the direct capital financing it supplies, foreign investment can be a source of valuable technology and know-how, which can have substantial positive effects on a host country's economic growth. Thus, it is critically important for policy makers and central bankers, among others, to understand how multinationals base their investment decisions on the characteristics of foreign exchange markets. In this essay, I first develop a theoretical framework to improve our knowledge regarding how the aggregate level of foreign investment responds to exchange rate uncertainty when an economy consists of many firms, each of which is making decisions. The analysis predicts a U-shaped effect of exchange rate uncertainty on the total level of foreign investment of the economy. That is, the effect is negative for low levels of uncertainty and positive for higher levels of uncertainty. This pattern emerges because the relationship between exchange rate volatility and 'the probability of investment is negative for firms with low productivity at home (i.e., firms that find it profitable to invest abroad) and the relationship is positive for firms with high productivity at home (i.e., firms that prefer exporting their product). This finding stands in sharp contrast to predictions in the existing literature that consider a single firm's decision to invest in a unique project. The main contribution of this research is to show that the aggregation over many firms produces a U-shaped pattern between exchange rate uncertainty and the probability of investment. Using data from industrialized countries for the period of 1982-2002, this essay offers a comprehensive empirical analysis that provides evidence in support of the theoretical prediction. In the second essay, I aim to explain the time variation in sovereign credit risk, which captures the risk that a government may be unable to repay its debt. The importance of correctly evaluating such a risk is illustrated by the central role of sovereign debt in previous international lending crises. In addition, sovereign debt is the largest asset class in emerging markets. In this essay, I provide a pricing formula for the evaluation of sovereign credit risk in which the decision to default on sovereign debt is made by the government. The pricing formula explains the variation across time in daily credit spreads - a widely used measure of credit risk - to a degree not offered by existing theoretical and empirical models. I use information on a country's stock market to compute the prevailing sovereign credit spread in that country. The pricing formula explains a substantial fraction of the time variation in daily credit spread changes for Brazil, Mexico, Peru, and Russia for the 1998-2008 period, particularly during the recent subprime crisis. I also show that when a government incentive to default is allowed to depend on current economic conditions, one can best explain the level of credit spreads, especially during the recent period of financial distress. In the third essay, I show that the risk of sovereign default abroad can produce adverse consequences for the U.S. equity market through a decrease in returns and an increase in volatility. The risk of sovereign default, which is no longer limited to emerging economies, has recently become a major concern for financial markets. While sovereign debt plays an increasing role in today's financial environment, the effects of sovereign credit risk on the U.S. financial markets have been largely ignored in the literature. In this essay, I develop a theoretical framework that explores how the risk of sovereign default abroad helps explain the level and the volatility of U.S. equity returns. The intuition for this effect is that negative economic shocks deteriorate the fiscal situation of foreign governments, thereby increasing the risk of a sovereign default that would trigger a local contraction in economic growth. The increased risk of an economic slowdown abroad amplifies the direct effect of these shocks on the level and the volatility of equity returns in the U.S. through two channels. The first channel involves a decrease in the future earnings of U.S. exporters resulting from unfavorable adjustments to the exchange rate. The second channel involves investors' incentives to rebalance their portfolios toward safer assets, which depresses U.S. equity prices. An empirical estimation of the model with monthly data for the 1994-2008 period provides evidence that the risk of sovereign default abroad generates a strong leverage effect during economic downturns, which helps to substantially explain the level and the volatility of U.S. equity returns.

Incidence of presumed endophthalmitis after intravitreal injection performed in the operating room: a retrospective multicenter study.

PURPOSE: To evaluate the incidence of presumed endophthalmitis (EO) after intravitreal injection (IVI) of anti-vascular endothelial growth factor agents performed in the operating room. METHODS: Retrospective study at 2 Swiss eye hospitals between 2004 and 2012. Hospital records were used to identify patients treated with an IVI of an anti-vascular endothelial growth factor agent between 2004 and 2012 and those treated for EO, defined as any intraocular inflammation treated with intravitreal antibiotics. All IVIs were performed using standard sterile technique in a Swiss Class 1 operating room. No patient received preinjection topical antibiotics. Postinjection topical antibiotics were used only in one hospital. RESULTS: A total of 40,011 IVIs were performed at the 2 centers during the study period. Of the IVIs, ranibizumab was injected in 36,398 (91%), bevacizumab in 3,518 (9%), aflibercept in 89 (0.2%), and pegaptanib in 6 (<0.1%). Three cases of post-IVI presumed EO occurred, yielding a combined incidence of 0.0075% per injection (95% confidence interval: 0.0026-0.0220%) or 1 case per 13,337 IVIs. Two of the three cases of EO occurred in patients using post-IVI antibiotics. All three cases followed ranibizumab injection and were culture negative by anterior chamber tap or vitreous biopsy. CONCLUSION: The risk of EO after IVI performed under the sterile conditions of the operating room was very low.

The association between drinking motives and alcohol-related consequences - room for biases and measurement issues?

Aims  To investigate whether the predominant finding of generalized positive associations between self-rated motives for drinking alcohol and negative consequences of drinking alcohol are influenced by (i) using raw scores of motives that may weight inter-individual response behaviours too strongly, and (ii) predictor-criterion contamination by using consequence items where respondents attribute alcohol use as the cause. Design  Cross-sectional study within the European School Survey Project on Alcohol and other Drugs (ESPAD). Setting  School classes. Participants  Students, aged 13-16 (n = 5633). Measurements  Raw, rank and mean-variance standardized scores of the Drinking Motives Questionnaire-Revised (DMQ-R); four consequences: serious problems with friends, sexual intercourse regretted the next day, physical fights and troubles with the police, each itemized with attribution ('because of your alcohol use') and without. Findings  As found previously in the literature, raw scores for all drinking motives had positive associations with negative consequences of drinking, while transformed (rank or Z) scores showed a more specific pattern: external reinforcing motives (social, conformity) had negative and internal reinforcing motives (enhancement, coping) had non-significant or positive associations with negative consequences. Attributed consequences showed stronger associations with motives than non-attributed ones. Conclusion  Standard scoring of the Drinking Motives Questionnaire (Revised) fails to capture motives in a way that permits specific associations with different negative consequences to be identified, whereas use of rank or Z-scores does permit this. Use of attributed consequences overestimates the association with drinking motives.