Modeling the Components of Market Discipline

This paper evaluates the role of inflation-forecast heterogeneity in US monetary policy making. The deviation between private and central bank inflation forecasts is identified as a factor increasing inflation persistence and thus calling for a policy reaction. An optimal policy rule is derived by the minimization under discretion of a standard central bank loss function subject to a Phillips curve, modified to include the forecast deviation, and a forward-looking aggregate demand equation. This rule, which itself includes the forecast deviation as an additional argument, is estimated for the period 1974-1998, covering the Chairmanships of Arthur Burns, Paul Volcker and Alan Greenspan, by using real-time forecasts of inflation and the output gap obtained from the FOMC’s Greenbook and the Survey of Professional Forecasters. The estimated rule remains remarkably stable over the whole sample period, challenging the conventional view of a structural break following Volcker’s appointment as Chairman of the Fed. Finally, the substantial decline in the significance of the interest-rate smoothing term in the rule indicates that monetary policy inertia may, to a large extent, be an artifact of serially correlated inflation-forecast errors that feed into policy decisions in real time.Market discipline, transparency, bank risk

Assessing the vulnerability to price spikes in agricultural commodity markets

We empirically examine the predictability of the conditions which are associated with a higher probability of a price spike in agricultural commodity markets. We find that the forward spread is the most significant indicator of probable price jumps in maize, wheat and soybeans futures markets, a result which is in line with the “Theory of Storage”. We additionally show that some option-implied variables add significant predictive power when added to the more standard information variable set. Overall, the estimated probabilities of large price increases from our probit models exhibit significant correlations with the historical sudden market upheavals in agricultural markets

Predicting species dominance shifts across elevation gradients in mountain forests in Greece under a warmer and drier climate

The Mediterranean Basin is expected to face warmer and drier conditions in the future, following projected increases in temperature and declines in precipitation. The aim of this study is to explore how forests dominated by Abies borisii-regis, Abies cephalonica, Fagus sylvatica, Pinus nigra and Quercus frainetto will respond under such conditions. We combined an individual-based model (GREFOS), with a novel tree ring data set in order to constrain tree diameter growth and to account for inter- and intraspecific growth variability. We used wood density data to infer tree longevity, taking into account inter- and intraspecific variability. The model was applied at three 500-m-wide elevation gradients at Taygetos in Peloponnese, at Agrafa on Southern Pindos and at Valia Kalda on Northern Pindos in Greece. Simulations adequately represented species distribution and abundance across the elevation gradients under current climate. We subsequently used the model to estimate species and functional trait shifts under warmer and drier future conditions based on the IPCC A1B scenario. In all three sites, a retreat of less drought-tolerant species and an upward shift of more drought-tolerant species were simulated. These shifts were also associated with changes in two key functional traits, in particular maximum radial growth rate and wood density. Drought-tolerant species presented an increase in their average maximal growth and decrease in their average wood density, in contrast to less drought-tolerant species

Financial needs and tools for agricultural development and transformation pertinent to low-income, food-insecure countries

The process of agricultural transformation is discussed, and the role of agriculture in both growth and poverty reduction is reviewed. The finance needs for agricultural development in low income food insecure countries is discussed, and the public and other official flows to agricultural development reviewed. It is seen that the monetary flows into agriculture have been grossly inadequate, compared to needs. The situation of smallholders is reviewed, and their financing needs are explored. It is indicated that the current finance flows to smallholders are less than 5 percent of perceived needs. A variety of institutional methods and models for increasing agricultural smallholder finance are then reviewed and assessed

Options for Developing Countries to Deal with Global Food Commodity Market Volatility

The paper first reviews several issues relevant to global food commodity market volatility as it pertains to food security, and food importing developing countries, and then discusses international and national policies and measures to prevent or manage this volatility and related risks. It is shown that market volatility relates to unpredictability of market fundamentals, and price spikes occur when unpredictability increases excessively. The behavior of commodity prices and market volatility is reviewed and it is concluded that the exact modeling of these is difficult, making predictions of market volatility uncertain. The risks faced by food import developing countries are discussed and it is highlighted that the major risks involve not only large and unpredictable price variations but also trade finance as well as import contract enforcement. The problem of identifying a price spike is analyzed and it is seen that, despite difficulties in commodity modeling, there are empirical techniques that allow the assessment of the probabilities of price spikes, and could facilitate the triggering of responses. There appear to be few cost effective ways to prevent market upheavals, but there seem to be some ways, reviewed in the paper, to instill more confidence in markets and hence reduce the chances of such abnormal events. Most effective appear to be ways to actively manage food market volatility and risks of excessive price spikes. A range of appropriate market and non-market based measures are reviewed and some new ideas are offered in this context

The Impact of Commercial Rainfall Index Insurance: Experimental Evidence from Ethiopia

We present the results of an experiment introducing commercial rainfall index insurance into drought-prone farming cooperatives in Amhara Region, Ethiopia. We provided a market-priced rainfall deficit insurance product through producer cooperatives and tested a number of potential ways to kick start private demand. Take up of the insurance at market prices is very low, between 0.5% and 3% across seasons. When we use a randomized experiment to distribute small free insurance contracts to farmers, 39% of subsidized individuals enroll but this fails to stimulate input use, yields, or income, nor does it enhance demand in subsequent seasons. A training and promotion on the product improves uptake and willingness to pay but also does not improve farming outcomes. We conclude with a case study of our efforts to interlink index insurance with credit for agricultural inputs

Assessing the Vulnerability to Price Spikes in Agricultural Commodity Markets

We examine empirically the predictability of conditions associated with a higher probability of a price spike in agricultural commodity markets. We find that the forward spread is the most significant indicator of probable price jumps in maize, wheat and soybeans futures markets, a result which is in line with the `Theory of Storage'. We additionally show that some option-implied variables add significant predictive power when added to the more standard information variable set. Overall, the estimated probabilities of large price increases from our probit models exhibit significant correlations with historical sudden market upheavals in agricultural markets

Transition of an electromagnetically driven liquid metal flow from laminar to turbulent in a toroidal square duct

The electromagnetically driven liquid metal flow in a toroidal duct of a square cross-section is studied numerically searching for the critical Reynolds (Re) and Hartmann (Ha) numbers where transition occurs. Results are reported for Ha up to 500, building a transition map of critical Reynolds and Hartmann numbers and showing two distinct regimes of transition signified by the destabilization of the secondary flow: The first, for Ha = 18, where it is balanced by fluid inertia. In both cases, the destabilization of the secondary flow occurs primarily near the concave sidewall. For Ha >= 18 the transition follows approximately the relationship Re = 16.803 Ha(1.43) for values of Re and Ha in the range 80 < Re/Ha < 224. Copyright (C) EPLA, 201

A proxitome-RNA-capture approach reveals that processing bodies repress co-regulated hub genes

Cellular condensates are usually ribonucleoprotein assemblies with liquid- or solid-like properties. Because these subcellular structures lack a delineating membrane, determining their compositions is difficult. Here we describe a proximity-biotinylation approach for capturing the RNAs of the condensates known as processing bodies (PBs) in Arabidopsis (Arabidopsis thaliana). By combining this approach with RNA detection, in silico, and high-resolution imaging approaches, we studied PBs under normal conditions and heat stress. PBs showed a much more dynamic RNA composition than the total transcriptome. RNAs involved in cell wall development and regeneration, plant hormonal signaling, secondary metabolism/defense, and RNA metabolism were enriched in PBs. RNA-binding proteins and the liquidity of PBs modulated RNA recruitment, while RNAs were frequently recruited together with their encoded proteins. In PBs, RNAs follow distinct fates: in small liquid-like PBs, RNAs get degraded while in more solid-like larger ones, they are stored. PB properties can be regulated by the actin-polymerizing SCAR (suppressor of the cyclic AMP)-WAVE (WASP family verprolin homologous) complex. SCAR/WAVE modulates the shuttling of RNAs between PBs and the translational machinery, thereby adjusting ethylene signaling. In summary, we provide an approach to identify RNAs in condensates that allowed us to reveal a mechanism for regulating RNA fate.Carl Tryggers Stiftelse foer Vetenskaplig Forskning 15:336, 17:336Svenska Forskningsradet Formas 2017-00938European Union 872969Helge Ax:son Johnsons stiftelse F19-0419Ministerio de Ciencia e Innovación BIO2017-84066-R, PID2020-119737GA-I00Junta de Andalucía ProyExcel_0058