The Great Moderation and the ‘Bernanke Conjecture’

Was the Great Moderation in the United States due to good policy or good luck? Taking, as data generation process, a New Keynesian sticky-price model in which the only source of change is the move from a passive to an active monetary rule, we show how standard econometric methods, both reducedform and structural, often misinterpret good policy for good luck. Specifically, we show how such a move is perfectly compatible with: (a) little change in the estimated impulse-response functions to a monetary policy shock, as in Stock and Watson (2002), Primiceri (2005), Canova and Gambetti (2005), and Gambetti, Pappa, and Canova (2006). (b) Significant changes in the estimated volatilities of both reduced-form and structural shocks–as in (e.g.) Ahmed, Levin, and Wilson (2004) and Stock and Watson (2002)–even in the absence, by construction, of any change in the volatilities of structural innovations. (c) Little change in the integrated normalised spectra of inflation and GDP growth at the business-cycle frequencies, as in Ahmed, Levin, and Wilson (2004). In line with Bernanke’s (2004) conjecture, the explanation is that conventional econometric methods are intrinsically incapable of capturing the role played by the systematic component of monetary policy in (de)stabilising in- flation expectations, and are therefore inevitably bound to confuse shifts in expected inflation with true structural innovations, thus giving the illusion of good luck even when good policy is, by construction, the authentic explanationGreat Inflation, indeterminacy, structural break tests, frequency domain, VARs.

VAR analysis and the Great Moderation

Most analyses of the U.S. Great Moderation have been based on structural VAR methods, and have consistently pointed towards good luck as the main explanation for the greater macroeconomic stability of recent years. Based on an estimated New-Keynesian model in which the only source of change is the move from passive to active monetary policy, we show that VARs may misinterpret good policy for good luck. First, the policy shift is suficient to generate decreases in the theoretical innovation variances for all series, and decreases in the variances of inflation and the output gap, without any need of sunspot shocks. With sunspots, the estimated model exhibits decreases in both variances and innovation variances for all series. Second, policy counterfactuals based on the theoretical structural VAR representations of the model under the two regimes fail to capture the truth, whereas impulse-response functions to a monetary policy shock exhibit little change across regimes. Since these results are in line with those found in the structural VARbased literature on the Great Moderation, our analysis suggests that existing VAR evidence is compatible with the ‘good policy’ explanation of the Great Moderation. JEL Classification: E38, E52DSGE Models, Great Moderation, indeterminacy, vector autoregressions

Vector Autoregression Analysis and the Great Moderation

Most analyses of the U.S. Great Moderation have been based on VAR methods, and have consistently pointed toward good luck as the main explanation for the greater macroeconomic stability of recent years. Using data generated by a New-Keynesian model in which the only source of change is the move from passive to active monetary policy, we show that VARs may misinterpret good policy for good luck. In particular, we detect significant breaks in estimated VAR innovation variances, although in the data generating process the volatilities of the structural shocks are constant across policy regimes. Counterfactual simulations, structural and reduced-form, point toward the incorrect conclusion of good luck. Our results cast doubts on the existing notion that VAR evidence is inconsistent with the good policy explanation of the Great Moderation.

Development of a new trigger system for spin-filtering studies

Polarized antiprotons allow unique access to a number of fundamental physics observables. One example is the transversity distribution which is the last missing piece to complete the knowledge of the nucleon partonic structure at leading twist in the QCD-based parton model. The transversity is directly measurable via Drell-Yan production in double polarized antiproton-proton collisions. This and a multitude of other findings, which are accessible via ~p ~p scattering experiments, led the Polarized Antiproton eXperiments (PAX) Collaboration to propose such investigations at the High Energy Storage Ring (HESR) of the Facility for Antiproton and Ion Research (FAIR). Futhermore the production of intense polarized antiproton beams is still an unsolved problem, which is the core of the PAX proposal. In this frame, an intense work on the feasibility of this ambitious project is going on at COSY (COoler SYnchrotron of the Institut für KernPhysik –IKP– of the Forschungs Zentrum Jülich) (FZJ) where the work of this thesis has been performed. Presently, the only available method to polarize an antiproton beam is by means of the mechanism of spin-filtering exploiting the spin dependence of the (p p) interaction via the repeated interaction with a polarized hydrogen target. Since the total cross section is different for parallel and antiparallel orientation of the beam particle spins relative to the direction of the target polarization, one spin direction is depleted faster than the other, so that the circulating beam becomes increasingly polarized, while the intensity decreases with time. A spin-filtering experiment with protons has been prepared and finally realized in 2011 at the COSY ring in Jülich. Aims of the spin-filtering experiments at COSY performed by the PAX Collaboration were two. The first was to confirm the present understanding of the spin filtering processes in storage rings, and the second was the commissioning of the experimental setup, which will be used for the experiments with the antiprotons. The major part of my PhD work consisted in the development and commissioning of a new trigger board to be implemented in the Data Acquisition System (DAQ) of the experiment. The motivation for the project was the replacement of the existing old-fashioned trigger system based on NIM logic modules, with a modern system based on FPGA programmable chips. This, also in perspective of the more complex detection system that the Collaboration is planning to realize for the future experimental activity. The trigger board was designed and realized by the electronic workshop of the University of Ferrara and INFN of Ferrara. My first task was to write the control-software of the board. After that I performed a series of development and commissioning tests which successfully demonstrated the full efficiency of the board and gave green light for the implementation of the board in the experimental setup

Evolving U.S. monetary policy and the decline of inflation predictability

Using a structural VAR with time-varying parameters and stochastic volatility on post-WWII U.S. data, we document a striking negative correlation between the evolution of the long-run coefficient on inflation in the monetary rule and the evolution of the persistence and predictability of inflation relative to a trend component. Using a standard sticky-price model, we show that a more aggressive policy stance towards inflation causes a decline in inflation predictability, providing a possible interpretation for the findings of the structural VAR. JEL Classification: E37, E52, E58Bayesian time-varying VARs, frequency domain, Great Inflation, predictability, sign restrictions

Multi-criteria community detection in International Trade Network

Understanding the community structure has great importance for economic analysis. Communities are characterized by properties different from those of both the individual node and the whole network and they affect various processes on the network. We combine community detection with specific topological indicators. As a result, a new weighted network is constructed by the original one, in which weights are determined taking into account all the topological indicators in a multi-criteria approach. We introduce a new algorithm to detect communities by solving the NP-hard CP-problem

Neoclassical realism and Italy's military behaviour, 1946–2010: a combined dyad/nation analysis

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Comparison of plasma lipids changes after middle-distance running in euglycemic and diabetic subjects

Background: Although regular performance of aerobic physical exercise is pivotal for preserving or improving health and fitness, scarce information is available on plasma lipids changes after middle-distance running in euglycemic and diabetic subjects. Methods: Eleven male euglycemic amateur runners (mean age 41\ub16 years) and 9 male diabetic amateur runners (4 with type 1 and 5 with type 2 diabetes; mean age 55\ub114 years) participated to a 21.1-km running trial. All subjects belonged to an amateur running team, regularly engaged in amateur running. Blood was collected before the start of the trial and immediately after. The lipid profile, encompassing measurement of total cholesterol, triglycerides, low-density lipoprotein cholesterol (LDL-C) and high-density lipoprotein cholesterol (HDL-C), was assayed with Roche Cobas 6000. Results: All athletes successfully completed the 21.1-km running trial, with running pace comprised between 9.6\u201312.8 km/h. In both categories of subjects the values of LDL-C significantly decreased by approximately 6% after the run, whilst HDL-C and triglycerides significantly increased by 6\u20139% and 30\u201336%, respectively. The post-run variations of all lipoprotein fractions after the running trial were virtually identical in diabetic and euglycemic subjects. Conclusions: The results of this study show for the first time that middle-distance running elicits acute favorable changes of lipid profile both in euglycemic and diabetic subjects. This form of endurance exercise shall hence be further fostered for purposes of public health promotion and improvement

Photoaging skin therapy with PRP and ADSC: a comparative study

Background: Stem cells from adipose tissue (ADSCs) and platelet-rich plasma (PRP) are innovative modalities that arise due to their regenerative potential. Objective: The aim of this study was to characterize possible histological changes induced by PRP and ADSC therapies in photoaged skin. Methods: A prospective randomized study involving 20 healthy individuals, showing skin aging. They underwent two therapeutic protocols (protocol 1: PRP; protocol 2: ADSCs). Biopsies were obtained before and after treatment (4 months). Results: PRP protocol showed unwanted changes in the reticular dermis, mainly due to the deposition of a horizontal layer of collagen (fibrosis) and elastic fibers tightly linked. Structural analyses revealed infiltration of mononuclear cells and depot of fibrotic material in the reticular dermis. The ADSC protocol leads to neoelastogenesis with increase of tropoelastin and fibrillin. There was an improvement of solar elastosis inducing an increment of macrophage polarization and matrix proteinases. These last effects are probably related to the increase of elastinolysis and the remodeling of the dermis. Conclusions: The PRP promoted an inflammatory process with an increase of reticular dermis thickness with a fibrotic aspect. On the other hand, ADSC therapy is a promising modality with an important antiaging effect on photoaged human skin

Nutrition and Inflammation in Older Individuals: Focus on Vitamin D, n-3 Polyunsaturated Fatty Acids and Whey Proteins

Chronic activation of the inflammatory response, defined as inflammaging, is the key physio-pathological substrate for anabolic resistance, sarcopenia and frailty in older individuals. Nutrients can theoretically modulate this phenomenon. The underlying molecular mechanisms reducing the synthesis of pro-inflammatory mediators have been elucidated, particularly for vitamin D, n-3 polyunsaturated fatty acids (PUFA) and whey proteins. In this paper, we review the current evidence emerging from observational and intervention studies, performed in older individuals, either community-dwelling or hospitalized with acute disease, and evaluating the effects of intake of vitamin D, n-3 PUFA and whey proteins on inflammatory markers, such as C-Reactive Protein (CRP), interleukin-1 (IL-1), interleukin-6 (IL-6) and tumor necrosis factor \u3b1 (TNF-\u3b1). After the analysis, we conclude that there is sufficient evidence for an anti-inflammatory effect in aging only for n-3 PUFA intake, while the few existing intervention studies do not support a similar activity for vitamin D and whey supplements. There is need in the future of large, high-quality studies testing the effects of combined dietary interventions including the above mentioned nutrients on inflammation and health-related outcomes