Household Credit and Probability Forecasts of Financial Distress in the United Kingdom

The growth of unsecured household credit relative to income has been marked in recent years and many observers have questioned whether it is sustainable. This paper develops a theory-based empirical model of equilibrium household consumption and credit. The equilibrium relationships are embedded within a vector-autoregressive model that can accommodate complex dynamics with a coherent long-run structure. We define the events associated with financial distress and describe probability forecasting methods that can be applied to the model to predict the likely occurence of distress events. The analysis is illustrated using unsecured credit market data for the UK.Financial Distress, Probability Forecasts, Household Spending and Credit.

A model for simulating dynamic problems of economic development

At head of title: Economic dynamics"July 1960."Includes bibliographic references (p. 198-203

Pursuing financial stability under an inflation-targeting regime

We evaluate two main views on pursuing financial stability within a flexible inflation targeting regime. It appears that potential gains from an activist or precautionary approach to promoting financial stability are highly shock dependent. We find support for the conventional view that concern for financial stability generally warrants a longer target horizon for inflation. The preferred target horizon depends on the financial stability indicator and the shock. An extension of the target horizon favoring financial stability may contribute to relatively higher variation in inflation and output.Monetary policy, financial stability

Price Stability vs. Low Inflation in Germany: An Analysis of Costs and Benefits

We empirically investigate the costs and benefits of going from low inflation to price stability in the case of Germany. Recent empirical evidence on the sacrifice ratio suggests that the break-even point at which the permanent benefits of reducing the trend rate of inflation by 2 percentage points exceeds the temporary costs in terms of output losses is below 0.3% of GDP. We analyze the welfare implications of the interactions even of moderate rates of inflation with the distorting effects of the German tax system. Four areas of economic activity are considered: intertemporal allocation of consumption, demand for owner-occupied housing, money demand, and government debt service. We estimate the direct welfare effects of reducing the rate of inflation as well as the indirect tax revenue effects. We find that reducing the inflation rate by 2 percentage points permanently increases welfare by 1.4% of GDP. Finally, the optimal rate of disinflation is considered.

Holistic biomimicry: a biologically inspired approach to environmentally benign engineering

Humanity's activities increasingly threaten Earth's richness of life, of which mankind is a part. As part of the response, the environmentally conscious attempt to engineer products, processes and systems that interact harmoniously with the living world. Current environmental design guidance draws upon a wealth of experiences with the products of engineering that damaged humanity's environment. Efforts to create such guidelines inductively attempt to tease right action from examination of past mistakes. Unfortunately, avoidance of past errors cannot guarantee environmentally sustainable designs in the future. One needs to examine and understand an example of an environmentally sustainable, complex, multi-scale system to engineer designs with similar characteristics. This dissertation benchmarks and evaluates the efficacy of guidance from one such environmentally sustainable system resting at humanity's doorstep - the biosphere. Taking a holistic view of biomimicry, emulation of and inspiration by life, this work extracts overarching principles of life from academic life science literature using a sociological technique known as constant comparative method. It translates these principles into bio-inspired sustainable engineering guidelines. During this process, it identifies physically rooted measures and metrics that link guidelines to engineering applications. Qualitative validation for principles and guidelines takes the form of review by biology experts and comparison with existing environmentally benign design and manufacturing guidelines. Three select bio-inspired guidelines at three different organizational scales of engineering interest are quantitatively validated. Physical experiments with self-cleaning surfaces quantify the potential environmental benefits generated by applying the first, sub-product scale guideline. An interpretation of a metabolically rooted guideline applied at the product / organism organizational scale is shown to correlate with existing environmental metrics and predict a sustainability threshold. Finally, design of a carpet recycling network illustrates the quantitative environmental benefits one reaps by applying the third, multi-facility scale bio-inspired sustainability guideline. Taken as a whole, this work contributes (1) a set of biologically inspired sustainability principles for engineering, (2) a translation of these principles into measures applicable to design, (3) examples demonstrating a new, holistic form of biomimicry and (4) a deductive, novel approach to environmentally benign engineering. Life, the collection of processes that tamed and maintained themselves on planet Earth's once hostile surface, long ago confronted and solved the fundamental problems facing all organisms. Through this work, it is hoped that humanity has taken one small step toward self-mastery, thus drawing closer to a solution to the latest problem facing all organisms.Ph.D.Committee Chair: Bert Bras; Committee Member: David Rosen; Committee Member: Dayna Baumeister; Committee Member: Janet Allen; Committee Member: Jeannette Yen; Committee Member: Matthew Realf