Panel Data Tests Of PPP: A Critical Overview

This paper reviews recent developments in the analysis of non-stationary panels, focusing on empirical applications of panel unit root and cointegration tests in the context of PPP. It highlights various drawbacks of existing methods. First, unit root tests suffer from severe size distortions in the presence of negative moving average errors. Second, the common demeaning procedure to correct for the bias resulting from homogeneous cross-sectional dependence is not effective; more worryingly, it introduces cross-correlation when it is not already present. Third, standard corrections for the case of heterogeneous cross-sectional dependence do not generally produce consistent estimators. Fourth, if there is between-group correlation in the innovations, the SURE estimator is affected by similar problems to FGLS methods, and does not necessarily outperform OLS. Finally, cointegration between different groups in the panel could also be a source of size distortions. We offer some empirical guidelines to deal with these problems, but conclude that panel methods are unlikely to solve the PPP puzzl

Macroscopic Noisy Bounded Confidence Models with Distributed Radical Opinions

In this article, we study the nonlinear Fokker-Planck (FP) equation that arises as a mean-field (macroscopic) approximation of bounded confidence opinion dynamics, where opinions are influenced by environmental noises and opinions of radicals (stubborn individuals). The distribution of radical opinions serves as an infinite-dimensional exogenous input to the FP equation, visibly influencing the steady opinion profile. We establish mathematical properties of the FP equation. In particular, we (i) show the well-posedness of the dynamic equation, (ii) provide existence result accompanied by a quantitative global estimate for the corresponding stationary solution, and (iii) establish an explicit lower bound on the noise level that guarantees exponential convergence of the dynamics to stationary state. Combining the results in (ii) and (iii) readily yields the input-output stability of the system for sufficiently large noises. Next, using Fourier analysis, the structure of opinion clusters under the uniform initial distribution is examined. Specifically, two numerical schemes for identification of order-disorder transition and characterization of initial clustering behavior are provided. The results of analysis are validated through several numerical simulations of the continuum-agent model (partial differential equation) and the corresponding discrete-agent model (interacting stochastic differential equations) for a particular distribution of radicals

A simple panel-CADF test for unit roots

Copyright © Blackwell Publishing Ltd and the Department of Economics, University of Oxford 2012. This is the accepted version of the following article: Costantini, M. and Lupi, C. (2013), A Simple Panel-CADF Test for Unit Roots. Oxford Bulletin of Economics and Statistics, 75: 276–296, which has been published in final form at http://onlinelibrary.wiley.com/doi/10.1111/j.1468-0084.2012.00690.x/abstract.In this paper, we propose a simple extension to the panel case of the covariate-augmented Dickey–Fuller (CADF) test for unit roots developed in Hansen (1995). The panel test we propose is based on a P values combination approach that takes into account cross-section dependence. We show that the test has good size properties and gives power gains with respect to other popular panel approaches. An empirical application is carried out for illustration purposes on international data to test the purchasing power parity (PPP) hypothesis

Chromospheric Evaporation in an X1.0 Flare on 2014 March 29 Observed with IRIS and EIS

Chromospheric evaporation refers to dynamic mass motions in flare loops as a result of rapid energy deposition in the chromosphere. These have been observed as blueshifts in X-ray and extreme-ultraviolet (EUV) spectral lines corresponding to upward motions at a few tens to a few hundreds of km/s. Past spectroscopic observations have also revealed a dominant stationary component, in addition to the blueshifted component, in emission lines formed at high temperatures (~10 MK). This is contradictory to evaporation models predicting predominant blueshifts in hot lines. The recently launched Interface Region Imaging Spectrograph (IRIS) provides high resolution imaging and spectroscopic observations that focus on the chromosphere and transition region in the UV passband. Using the new IRIS observations, combined with coordinated observations from the EUV Imaging Spectrometer, we study the chromospheric evaporation process from the upper chromosphere to corona during an X1.0 flare on 2014 March 29. We find evident evaporation signatures, characterized by Doppler shifts and line broadening, at two flare ribbons separating from each other, suggesting that chromospheric evaporation takes place in successively formed flaring loops throughout the flare. More importantly, we detect dominant blueshifts in the high temperature Fe XXI line (~10 MK), in agreement with theoretical predictions. We also find that, in this flare, gentle evaporation occurs at some locations in the rise phase of the flare, while explosive evaporation is detected at some other locations near the peak of the flare. There is a conversion from gentle to explosive evaporation as the flare evolves.Comment: ApJ in pres

Exoplanet atmospheres with GIANO II. Detection of molecular absorption in the dayside spectrum of HD 102195b

The study of exoplanetary atmospheres is key to understand the differences between their physical, chemical and dynamical processes. Up to now, the bulk of atmospheric characterization analysis has been conducted on transiting planets. On some sufficiently bright targets, high-resolution spectroscopy (HRS) has also been successfully tested for non-transiting planets. We study the dayside of the non-transiting planet HD 102195b using the GIANO spectrograph mounted at TNG, demonstrating the feasibility of atmospheric characterization measurements and molecular detection for non-transiting planets with the HRS technique using 4-m class telescopes. The Doppler-shifted planetary signal changes on the order of many km/s during the observations, in contrast with the telluric absorption which is stationary in wavelength, allowing us to remove the contamination from telluric lines while preserving the features of the planetary spectrum. The emission signal from HD 102195b's atmosphere is then extracted by cross-correlating the residual spectra with atmospheric models. We detect molecular absorption from water vapor at 4.4$\sigma$ level. We also find convincing evidence for the presence of methane, which is detected at the 4.1$\sigma$ level. The two molecules are detected with a combined significance of 5.3$\sigma$, at a semi-amplitude of the planet radial velocity $K_P=128\pm 6$ km/s. We estimate a planet true mass of $M_P=0.46\pm 0.03~M_J$ and orbital inclination between 72.5 and 84.79$^{\circ}$ (1$\sigma$). Our analysis indicates a non-inverted atmosphere for HD 102195b, as expected given the relatively low temperature of the planet, inefficient to keep TiO/VO in gas phase. Moreover, a comparison with theoretical expectations and chemical model predictions corroborates our methane detection and suggests that the detected $CH_4$ and $H_2O$ signatures could be consistent with a low C/O ratio.Comment: 12 pages, 12 figures, accepted for publication in A&

Stabilization of vortex beams in Kerr media by nonlinear absorption

We elaborate a new solution for the problem of stable propagation of transversely localized vortex beams in homogeneous optical media with self-focusing Kerr nonlinearity. Stationary nonlinear Bessel-vortex states are stabilized against azimuthal breakup and collapse by multiphoton absorption, while the respective power loss is offset by the radial influx of the power from an intrinsic reservoir. A linear stability analysis and direct numerical simulations reveal a region of stability of these vortices. Beams with multiple vorticities have their stability regions too. These beams can then form robust tubular filaments in transparent dielectrics as common as air, water and optical glasses at sufficiently high intensities. We also show that the tubular, rotating and speckle-like filamentation regimes, previously observed in experiments with axicon-generated Bessel beams, can be explained as manifestations of the stability or instability of a specific nonlinear Bessel-vortex state, which is fully identified.Comment: Physical Review A, in press, 9 pages, 6 figure

On the long-run determinants of real exchange rates for developing countries : Evidence from Africa, Latin America and Asia

The main goal of this paper is to tackle the empirical issues of the real exchange rate litterature by applying recently developed panel cointegration techniques to a structural long-run real exchange rate equation. We consider here a sample of 45 developing countries, divided into three groups according to geographical criteria: Africa, Latin America and Asia. Our investigations confirm that having a reference to assess the degree of distortion of real exchange rate is not as simple as it can be thought with the PPP concept. The real exchange rate is e?ectively at the centre of an economic spiral and its value depends on the economic specificities of each country. In other words, we don’t have a fixed and general norm but, for each economy, the real exchange rate trajectory depends on its development level, on the way economic policy is conducted, and on its position on the international market.http://deepblue.lib.umich.edu/bitstream/2027.42/39957/3/wp571.pd