Life Cycle Models, Heterogeneity of Initial Assets,and Wealth Inequality

Life cycle general equilibrium models with heterogeneous agents have a very hard time reproducing the American wealth distribution. A common assumption made in this literature is that all young adults enter the economy with no initial assets. In this article, we relax this assumption – not supported by the data - and evaluate the ability of an otherwise standard life cycle model to account for the U.S. wealth inequality. The new feature of the model is that agents enter the economy with assets drawn from an initial distribution of assets, which is estimated using a non-parametric method applied to data from the Survey of Consumer Finances. We found that heterogeneity with respect to initial wealth is key for this class of models to replicate the data. According to our results, American inequality can be explained almost entirely by the fact that some individuals are lucky enough to be born into wealth, while others are born with few or no assets.

Essays on health care reform, wealth inequality, and demography

This thesis contains three chapters. The first chapter uses a general equilibrium framework to simulate and compare the long run effects of the Patient Protection and Affordable Care Act (PPACA) and of health care costs reduction policies on macroeconomic variables, government budget, and welfare of individuals. We found that all policies were able to reduce uninsured population, with the PPACA being more effective than cost reductions. The PPACA increased public deficit mainly due to the Medicaid expansion, forcing tax hikes. On the other hand, cost reductions alleviated the fiscal burden of public insurance, reducing public deficit and taxes. Regarding welfare effects, the PPACA as a whole and cost reductions are welfare improving. High welfare gains would be achieved if the U.S. medical costs followed the same trend of OECD countries. Besides, feasible cost reductions are more welfare improving than most of the PPACA components, proving to be a good alternative. The second chapter documents that life cycle general equilibrium models with heterogeneous agents have a very hard time reproducing the American wealth distribution. A common assumption made in this literature is that all young adults enter the economy with no initial assets. In this chapter, we relax this assumption – not supported by the data – and evaluate the ability of an otherwise standard life cycle model to account for the U.S. wealth inequality. The new feature of the model is that agents enter the economy with assets drawn from an initial distribution of assets. We found that heterogeneity with respect to initial wealth is key for this class of models to replicate the data. According to our results, American inequality can be explained almost entirely by the fact that some individuals are lucky enough to be born into wealth, while others are born with few or no assets. The third chapter documents that a common assumption adopted in life cycle general equilibrium models is that the population is stable at steady state, that is, its relative age distribution becomes constant over time. An open question is whether the demographic assumptions commonly adopted in these models in fact imply that the population becomes stable. In this chapter we prove the existence of a stable population in a demographic environment where both the age-specific mortality rates and the population growth rate are constant over time, the setup commonly adopted in life cycle general equilibrium models. Hence, the stability of the population do not need to be taken as assumption in these models.

Deciding the sale of a life policy in the viatical market: Implications on individual welfare

[cat] En aquest article, es presenta un model econòmic que permet determinar la venda o no d'una pòlissa de vida (total o en part) per part d'un assegurat malalt terminal en el mercat dels viatical settlements. Aquest mercat va aparèixer a finals de la dècada dels 80 a conseqüència de l'epidèmia de la SIDA. Actualment, representa una part del mercat dels life settlements. Les pòlisses que es comercialitzen en el mercat dels viaticals són aquelles on l'assegurat és malalt terminal amb una esperança de vida de dos anys o menys. El model és discret i considera només dos períodes (anys), ja que aquesta és la vida residual màxima que contempla el mercat. L'agent posseix una riquesa inicial que ha de repartir entre consum i herència. S'introdueix en primer lloc la funció d'utilitat esperada del decisor i, utilitzant programació dinàmica, es dedueix l'estratègia que reporta una utilitat més gran (no vendre/vendre (en part) la pòlissa en el moment zero/vendre (en part) la pòlissa en el moment ú). L'òptim depèn del preu de la pòlissa venuda i de paràmetres personals de l'individu. Es troba una expressió analítica per l'estratègia òptima i es realitza un anàlisi de sensibilitat.

Deciding the sale of a life policy in the viatical market: Implications on individual welfare

[cat] En aquest article, es presenta un model econòmic que permet determinar la venda o no d'una pòlissa de vida (total o en part) per part d'un assegurat malalt terminal en el mercat dels viatical settlements. Aquest mercat va aparèixer a finals de la dècada dels 80 a conseqüència de l'epidèmia de la SIDA. Actualment, representa una part del mercat dels life settlements. Les pòlisses que es comercialitzen en el mercat dels viaticals són aquelles on l'assegurat és malalt terminal amb una esperança de vida de dos anys o menys. El model és discret i considera només dos períodes (anys), ja que aquesta és la vida residual màxima que contempla el mercat. L'agent posseix una riquesa inicial que ha de repartir entre consum i herència. S'introdueix en primer lloc la funció d'utilitat esperada del decisor i, utilitzant programació dinàmica, es dedueix l'estratègia que reporta una utilitat més gran (no vendre/vendre (en part) la pòlissa en el moment zero/vendre (en part) la pòlissa en el moment ú). L'òptim depèn del preu de la pòlissa venuda i de paràmetres personals de l'individu. Es troba una expressió analítica per l'estratègia òptima i es realitza un anàlisi de sensibilitat.

On impatience, education, returns, and inequality

In this paper we investiga te the impact of initial wealth anel impatience heterogeneities, as wcll as differential access to financia! markets on povcrty anel inequality, anel cvaluate some mechanisms that could be used to alleviate situations in which these two issues are alarming. To address our qucstion we develop a dynamic stochastic general cquilibrium modo! of educational anel savings choicc with heterogeneous agents, where individuais differ in their initial wealth anel in their discount factor. We find that, in the long run, more patient households tend to be wealthier anel more educated. However, our baseline model is not able to give as much skewness to our income distribution as it is rcquircd. We then propose a novel returns structure based on empírica! observation of heterogeneous returns to different portfolios. This modification solves our previous problem, evidencing the importance of the changes made in explaining the existing levels of inequality. Finally, we introducc two kinds of cash transfers programs- one in which receiving thc benefit is conditional on educating the household's youngster (CCTS) anel one frec of conditionalities (CTS) - in order to evaluate the impact of these programs on the variables of concern1 Wc fine! that both policies have similar qualitativo rcsults. Quantitatively, howcvcr, the CCTS outperforms its unconclitional version in all fielcls analyzecl, revealing itself to be a preferable policy.

Legal enforcement, collateral and heterogeneity of project financing contracts

This paper employs mechanism design to study the effects of imperfect legal enforcement on optimal scale of projects, borrowing interest rates and the probability of default. The analysis departs from an environment that combines asymmetric information about cash flows and limited commitment by borrowers. Incentive for repayment comes from the possibility of liquidation of projects by a court, but courts are costly and may fail to liquidate. The value of liquidated assets can be used as collateral: it is transferred to the lender when courts liquidate. Examples reveal that costly use of courts may be optimal, which contrasts with results from most limited commitment models, where punishments are just threats, never applied in optimal arrangements. I show that when voluntary liquidation is allowed, both asymmetric information and uncertainty about courts are necessary conditions for legal punishments ever to be applied. Numerical solutions for several parametric specifications are presented, allowing for heterogeneity on initial wealth and variability of project returns. In all such solutions, wealthier individuals borrow with lower interest rates and run higher scale enterprises, which is consistent with stylized facts. The reliability of courts has a consistently positive effect on the scale of projects. However its effect on interest rates is subtler and depends essentially on the degree of curvature of the production function. Numerical results also show that the possibility of collateral seizing allows comovements of the interest rates and the probability of repayment.

Long-run performance of initial public offerings: The evidence for Switzerland

We estimate the underpricing and long-run performance of Swiss initial public offerings (IPOs) from 1983 to 2000. The average market adjusted initial return is 34.97%. To examine the long-run performance of Swiss IPOs, we compute buy-and-hold abnormal returns, skewness-adjusted wealth ratios, and cumulative abnormal returns using 120 months of secondary market returns. In contrast to previous findings for the U.S. and Germany, we do not find strong evidence for a distinct IPO effect. We attribute long-run underperformance to the fact that IPO firms tend to be small firms. It virtually vanishes when we use a small capitalization index as a benchmark. In spite of distinct economic implications and statistical properties, our basic results are similar for all performance measures applied.

Evaluation Of Soft-tissue Lesions With (18)f-fdg Pet/ct: Initial Results Of A Prospective Trial.

Although MRI is utilized for planning the resection of soft-tissue tumors, it is not always capable of differentiating benign from malignant lesions. The risk of local recurrence of soft-tissue sarcomas is increased when biopsies are performed before resection and by inadequate resections. PET associated with computed tomography using fluorodeoxyglucose labeled with fluorine-18 ((18)F-FDG PET/CT) may help differentiate between benign and malignant tumors, thus avoiding inadequate resections and making prior biopsies unnecessary. The purpose of this study was to evaluate the usefulness of (18)F-FDG PET/CT in differentiating benign from malignant solid soft-tissue lesions. Patients with solid lesions of the limbs or abdominal wall detected by MRI were submitted to (18)F-FDG PET/CT. The maximum standardized uptake value (SUVmax) cutoff was determined to differentiate malignant from benign tumors. Regardless of the (18)F-FDG PET/CT results all patients underwent biopsy and surgery. MRI was performed in 54 patients, and 10 patients were excluded because of purely lipomatose or cystic lesions. (18)F-FDG PET/CT was performed in the remaining 44 patients. Histopathology revealed 26 (59%) benign and 18 (41%) malignant soft-tissue lesions. A significant difference in SUVmax was observed between benign and malignant soft-tissue lesions. The SUVmax cutoff of 3.0 differentiated malignant from benign lesions with 100% sensitivity, 83.3% specificity, 89.6% accuracy, 78.3% positive predictive value, and 100% negative predictive value. (18)F-FDG PET/CT seems to be able to differentiate benign from malignant soft-tissue lesions with good accuracy and very high negative predictive value. Incorporating (18)F-FDG PET/CT into the diagnostic algorithm of these patients may prevent inadequate resections and unnecessary biopsies.

Value Of Sentinel Lymph Node Biopsy In Papillary Thyroid Cancer: Initial Results Of A Prospective Trial.

The objectives of the study were to evaluate the performance of sentinel lymph node biopsy (SLNB) in detecting occult metastases in papillary thyroid carcinoma (PTC) and to correlate their presence to tumor and patient characteristics. Twenty-three clinically node-negative PTC patients (21 females, mean age 48.4 years) were prospectively enrolled. Patients were submitted to sentinel lymph node (SLN) lymphoscintigraphy prior to total thyroidectomy. Ultrasound-guided peritumoral injections of (99m)Tc-phytate (7.4 MBq) were performed. Cervical single-photon emission computed tomography and computed tomography (SPECT/CT) images were acquired 15 min after radiotracer injection and 2 h prior to surgery. Intra-operatively, SLNs were located with a gamma probe and removed along with non-SLNs located in the same neck compartment. Papillary thyroid carcinoma, SLNs and non-SLNs were submitted to histopathology analysis. Sentinel lymph nodes were located in levels: II in 34.7 % of patients; III in 26 %; IV in 30.4 %; V in 4.3 %; VI in 82.6 % and VII in 4.3 %. Metastases in the SLN were noted in seven patients (30.4 %), in non-SLN in three patients (13.1 %), and in the lateral compartments in 20 % of patients. There were significant associations between lymph node (LN) metastases and the presence of angio-lymphatic invasion (p = 0.04), extra-thyroid extension (p = 0.03) and tumor size (p = 0.003). No correlations were noted among LN metastases and patient age, gender, stimulated thyroglobulin levels, positive surgical margins, aggressive histology and multifocal lesions. Sentinel lymph node biopsy can detect occult metastases in PTC. The risk of a metastatic SLN was associated with extra-thyroid extension, larger tumors and angio-lymphatic invasion. This may help guide future neck dissection, patient surveillance and radioiodine therapy doses.

In Vivo Evaluation Of The Genetic Toxicity Of Rubus Niveus Thunb. (rosaceae) Extract And Initial Screening Of Its Potential Chemoprevention Against Doxorubicin-induced Dna Damage.

Rubus niveus Thunb. plant belongs to Rosaceae family and have been used traditionally to treat wounds, burns, inflammation, dysentery, diarrhea and for curing excessive bleeding during menstrual cycle. The present study was undertaken to investigate the in vivo genotoxicity of Rubus niveus aerial parts extract and its possible chemoprotection on doxorubicin (DXR)-induced DNA damage. In parallel, the main phytochemicals constituents in the extract were determined. The animals were exposed to the extract for 24 and 48h, and the doses selected were 500, 1000 and 2000mg/kg b.w. administered by gavage alone or prior to DXR (30mg/kg b.w.) administered by intraperitoneal injection. The endpoints analyzed were DNA damage in bone marrow and peripheral blood cells assessed by the alkaline alkaline (pH>13) comet assay and bone marrow micronucleus test. The results of chemical analysis of the extract showed the presence of tormentic acid, stigmasterol, quercitinglucoronide (miquelianin) and niga-ichigoside F1 as main compounds. Both cytogenetic endpoints analyzed showed that there were no statistically significant differences (p>0.05) between the negative control and the treated groups with the two higher doses of Rubus niveus extract alone, demonstrating absence of genotoxic and mutagenic effects. Aneugenic/clastogenic effect was observed only at 2000mg/kg dose. On the other hand, in the both assays and all tested doses were observed a significant reduction of DNA damage and chromosomal aberrations in all groups co-treated with DXR and extract compared to those which received only DXR. These results indicate that Rubus niveus aerial parts extract did not revealed any genotoxic effect, but presented some aneugenic/clastogenic effect at higher dose; and suggest that it could be a potential adjuvant against development of second malignant neoplasms caused by the cancer chemotherapic DXR.

Central retinal vein thrombosis as an initial manifestation of heterozygous protein C deficiency: case report

The purpose of this paper is to report a case of central retinal vein thrombosis associated with isolated heterozygous protein C deficiency. Acute occlusion of the central retinal vein presents as one of the most dramatic pictures in ophthalmology. It is often a result of both local and systemic causes. A rare systemic cause is heterozygous protein C deficiency, and it usually occurs in combination with other thrombophilic conditions. This case highlights that isolated heterozygous protein C deficiency may be the cause of central retinal vein thrombosis and underscores the importance of its screening in young patients with this ophthalmologic disease.

Initial challenges in the career of ophthalmologists

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Self-medication: initial treatments used by patients seen in an ophthalmologic emergency room

OBJECTIVE: This study seeks to identify practices of self-medication in the treatment of ocular emergencies. We examine patients' use of both homemade preparations and manufactured products before seeking specialized care. MATERIALS AND METHODS: We conducted a cross-sectional analytic survey of consecutive patients seen in the ophthalmology emergency room of a teaching hospital. RESULTS: The sample included 561 subjects, 51.3% males and 48.7% females, with a mean age of 39.8 years. Prior to seeking emergency care, 40.5% reported self-medicating; 29.4% used a homemade preparation (13.9% referred to an industrialized product like boric acid as a homemade preparation), and 11.1% used a manufactured product. The most frequently used products included a boric acid solution (53.3%), a normal saline solution (35.7%), herbal infusions (6.1%) and breast milk (4.8%). Viral conjunctivitis was the most frequent diagnosis (24.4%), followed by the presence of a corneal foreign body (7.4%). No significant differences were found in the self-treatment of ocular injuries according to gender (p = 0.95), level of education (p = 0.21) or age (p = 0.14). In addition, self-medication practices were not related to the medically judged severity of the condition. CONCLUSION: Patients often attempt to treat conditions that require ophthalmologic emergency care by self-medicating with homemade or manufactured products. The most widely used products include boric acid, normal saline, leaf infusions and breast milk. This behavior occurs independently of educational level, gender, age or the nature of the ocular condition. Self-medication is a culturally driven practice that is used even in cases of acute ocular injuries.

Combining Legendre's Polynomials and Genetic Algorithm in the Solution of Nonlinear Initial-Value Problems

This work develops a method for solving ordinary differential equations, that is, initial-value problems, with solutions approximated by using Legendre's polynomials. An iterative procedure for the adjustment of the polynomial coefficients is developed, based on the genetic algorithm. This procedure is applied to several examples providing comparisons between its results and the best polynomial fitting when numerical solutions by the traditional Runge-Kutta or Adams methods are available. The resulting algorithm provides reliable solutions even if the numerical solutions are not available, that is, when the mass matrix is singular or the equation produces unstable running processes.

The International Collaboration on Air Pollution and Pregnancy Outcomes: Initial Results

BACKGROUND: The findings of prior studies of air pollution effects on adverse birth outcomes are difficult to synthesize because of differences in study design. OBJECTIVES: The International Collaboration on Air Pollution and Pregnancy Outcomes was formed to understand how differences in research methods contribute to variations in findings. We initiated a feasibility study to a) assess the ability of geographically diverse research groups to analyze their data sets using a common protocol and b) perform location-specific analyses of air pollution effects on birth weight using a standardized statistical approach. METHODS: Fourteen research groups from nine countries participated. We developed a protocol to estimate odds ratios (ORs) for the association between particulate matter <= 10 mu m in aerodynamic diameter (PM(10)) and low birth weight (LBW) among term births, adjusted first for socioeconomic status (SES) and second for additional location-specific variables. RESULTS: Among locations with data for the PM(10) analysis, ORs estimating the relative risk of term LBW associated with a 10-mu g/m(3) increase in average PM(10) concentration during pregnancy, adjusted for SES, ranged from 0.63 [95% confidence interval (CI), 0.30-1.35] for the Netherlands to 1.15 (95% CI, 0.61-2.18) for Vancouver, with six research groups reporting statistically significant adverse associations. We found evidence of statistically significant heterogeneity in estimated effects among locations. CONCLUSIONS: Variability in PM(10)-LBW relationships among study locations remained despite use of a common statistical approach. A more detailed meta-analysis and use of more complex protocols for future analysis may uncover reasons for heterogeneity across locations. However, our findings confirm the potential for a diverse group of researchers to analyze their data in a standardized way to improve understanding of air pollution effects on birth outcomes.