The Volatility Costs of Procyclical Lending Standards: An Assessment Using a DSGE Model

The ongoing financial turmoil has triggered a lively debate on ways of containing systemic risk and lessening the likelihood of future boom-and-bust episodes in credit markets. Particularly, it has been argued that banking regulation might attenuate procyclicality in lending standards by affecting the behavior of banks capital buffers. This paper uses a two-country DSGE model with financial frictions to illustrate how procyclicality in borrowing limits reinforces the ”overreaction” of asset prices to shocks described by Aiyagari and Gertler (1999), and to quantify the stabilization gains from policies aimed at smoothing cyclical swings in credit conditions. Results suggest that, in financially constrained economies, the ensuing volatility reduction in equity prices, investment, and external imbalances would be sizable. In the presence of cross-border spillovers, gains would be even higher.Credit Cycles; Collateral Constraints; DSGE Models

Monetary Magic? How the Fed Improved the Supply Side of the Economy

Extending recent theoretical contributions on sources of inflation inertia, we argue that monetary uncertainty accounts for sluggish expectations adjustment to nominal disturbances. Estimating a model in which rational individuals learn over time about shifts in U.S. monetary policy and the Phillips curve, we find strong evidence that this link exists. These results question the standard approach for evaluating monetary rules by assuming unchanged private sector responses, help clarify the role of monetary stability in reducing output variability in the U.S. and elsewhere, and tell a subtle and dynamic story of the interaction between monetary policy and the supply-side of the econoInflation dynamics; Monetary policy; Kalman filter

Monetary Magic? How the Fed Improved the Supply Side of the Economy

Extending recent theoretical contributions on sources of inflation inertia, we argue that monetary uncertainty accounts for sluggish expectations adjustment to nominal disturbances. Estimating a model in which rational individuals learn over time about shifts in U.S. monetary policy and the Phillips curve, we find strong evidence that this link exists. These results question the standard approach for evaluating monetary rules by assuming unchanged private sector responses, help clarify the role of monetary stability in reducing output variability in the U.S. and elsewhere, and tell a subtle and dynamic story of the interaction between monetary policy and the supply-side of the ecoInflation dynamics; Monetary Policy; Kalman filter

(Un)naturally low? Sequential Monte Carlo tracking of the US natural interest rate

Following the 2000 stockmarket crash, have US interest rates been held "too low" in relation to their natural level? Most likely, yes. Using a structural neo-Keynesian model, this paper attempts a real-time evaluation of the US monetary policy stance while ensuring consistency between the specification of price adjustments and the evolution of the econ- omy under flexible prices. To do this, the model's likelihood function is evaluated using a Sequential Monte Carlo algorithm providing inference about the time-varying distribution of structural parameters and unobservable, nonstationary state variables. Tracking down the evolution of underlying stochastic processes in real time is found crucial (i) to explain postwar Fed's policy and (ii) to replicate salient features of the data. JEL Classification: E43, C11, C15Bayesian Analysis, DSGE Models, Natural Interest Rate, Particle Filters

Policy evaluation with macroeconometric models

This thesis presents a number of examples where macroeconometric models are employed as useful tools for evaluation of contemporary policy problems. A range of approaches is proposed to shed light on how macromodels can actually contribute to the policy debate. In particular, the thesis emphasises how different models maybe augmented or modified and stresses the need for care in the experimental design of policy simulations. Small stylised models of the UK economy are estimated in the first part of this thesis. They are used to assess the performance of simple monetary policy rules under the current inflation targeting monetary regime. In a monetary policy regime of inflation targeting, the appropriate target band-width can be assessed by calculating the variance of inflation in a macroeconomic model under alternative policy rules. A recent Bank of England study concludes from stochastic simulation of a small semi-structural model that a 'fairly substantial lump of inflation uncertainty' exists in the United Kingdom. In chapter 2 an extended and improved version of that model is developed while their estimates of inflation variability are revised downwards by deploying analytic techniques. In chapter 3 a new small 'semi structural' dynamic model of the UK economy is estimated, with particular attention to the modelling of wages and prices. It is used to assess the performance of simple monetary policy rules, including 'inflation forecast targeting' and 'Taylor' rules, while taking into account different degrees of forward-lookingness in both inflation targeting horizon and wage bargaining. Computation of asymptotic inflation-output standard-error trade-offs is provided under various specifications and parametrisations of the model. Large-scale country models have the convenience to make explicit a complete range of relationships among macroeconomic variables most of which, for obvious reasons, are neglected in smaller dynamic models. As a consequence, such quantitative framework offers an unique opportunity to evaluate not only the aggregate impact of exogenous shocks on the variables of interest, but also to identify the underlying economic mechanisms enabling the transmission of such shocks. In the second part of the thesis, I undertake simulations of the National Institute's Domestic Econometric Model (NIDEM) to analyse the characteristics of the UK monetary transmission mechanism. Chapter 4 emphasises that the impact of interest rate movements on real variables is strictly determined by both the monetary regime at work and the underlying assumptions regarding consumption behaviour. Certainly, the steady integration of the members of the EMU and increasing awareness of the need for closer co-operation in monetary and fiscal policy have stimulated greater interest in modelling interdependencies between European countries and the impact and feedbacks from the rest of the world economy. Many of the key issues have now an international aspect, so it becomes more and more difficult to rely on single-country models to provide necessary analysis. International transmission mechanisms can therefore be better tackled with a multi-country model. The third and last part of this thesis focuses on cross-country asymmetric transmissions in response to a common monetary shock within EMU. In particular, in chapter 5 an empirical analysis of the links between monetary and fiscal policy within EMU is presented. This is done through simulation of a neo-classical highly non-Ricardian multi-country model: the IMF's MULTIMOD Mark III (MM3). Chapter 6 provides further evidence about the effects of embracing a Monetary Union when underlying macroeconomist structures still differ across countries. By use of the same model-based quantitative framework, this chapter examines the role of nominal and real rigidities in European labour markets for the assessment of asymmetries in monetary transmission under various monetary regimes

Congenital Myopathy as a Phenotypic Expression of CACNA1S Gene Mutation: Case Report and Systematic Review of the Literature

Background: Congenital myopathies are a group of clinically, genetically, and histologically heterogeneous diseases caused by mutations in a large group of genes. One of these is CACNA1S, which is recognized as the cause of Dihydropyridine Receptor Congenital Myopathy. Methods: To better characterize the phenotypic spectrum of CACNA1S myopathy, we conducted a systematic review of cases in the literature through three electronic databases following the PRISMA guidelines. We selected nine articles describing 23 patients with heterozygous, homozygous, or compound heterozygous mutations in CACNA1S and we added one patient with a compound heterozygous mutation in CACNA1S (c.1394-2A>G; c.1724T>C, p.L575P) followed at our Institute. We collected clinical and genetic data, muscle biopsies, and muscle MRIs when available. Results: The phenotype of this myopathy is heterogeneous, ranging from more severe forms with a lethal early onset and mild-moderate forms with a better clinical course. Conclusions: Our patient presented a phenotype compatible with the mild-moderate form, although she presented peculiar features such as a short stature, myopia, mild sensorineural hearing loss, psychiatric symptoms, and posterior-anterior impairment gradient on thigh muscle MRI

The wide world of technological telerehabilitation for pediatric neurologic and neurodevelopmental disorders – a systematic review

IntroductionThe use of Information and Communication Technology (ICT) for assessing and treating cognitive and motor disorders is promoting home-based telerehabilitation. This approach involves ongoing monitoring within a motivating context to help patients generalize their skills. It can also reduce healthcare costs and geographic barriers by minimizing hospitalization. This systematic review focuses on investigating key aspects of telerehabilitation protocols for children with neurodevelopmental or neurological disorders, including technology used, outcomes, caregiver involvement, and dosage, to guide clinical practice and future research.MethodThis systematic review adhered to PRISMA guidelines and was registered in PROSPERO. The PICO framework was followed to define the search strategy for technology-based telerehabilitation interventions targeting the pediatric population (aged 0–18) with neurological or neurodevelopmental disorders. The search encompassed Medline/PubMed, EMBASE, and Web of Science databases. Independent reviewers were responsible for selecting relevant papers and extracting data, while data harmonization and analysis were conducted centrally.ResultsA heterogeneous and evolving situation emerged from our data. Our findings reported that most of the technologies adopted for telerehabilitation are commercial devices; however, research prototypes and clinical software were also employed with a high potential for personalization and treatment efficacy. The efficacy of these protocols on health or health-related domains was also explored by categorizing the outcome measures according to the International Classification of Functioning, Disability, and Health (ICF). Most studies targeted motor and neuropsychological functions, while only a minority of papers explored language or multi-domain protocols. Finally, although caregivers were rarely the direct target of intervention, their role was diffusely highlighted as a critical element of the home-based rehabilitation setting.DiscussionThis systematic review offers insights into the integration of technological devices into telerehabilitation programs for pediatric neurologic and neurodevelopmental disorders. It highlights factors contributing to the effectiveness of these interventions and suggests the need for further development, particularly in creating dynamic and multi-domain rehabilitation protocols. Additionally, it emphasizes the importance of promoting home-based and family-centered care, which could involve caregivers more actively in the treatment, potentially leading to improved clinical outcomes for children with neurological or neurodevelopmental conditions.Systematic review registrationPROSPERO (CRD42020210663)

Policy evaluation with macroeconometric models

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