Financial Intermediation, Moral Hazard, And Pareto Inferior Trade

We consider a simple model of international trade under uncertainty, where production takes time and is subject to uncertainty. The riskiness of production depends on the choices of the producers, not observable to the general public, and these choices are influenced by the availability and cost of credit. If investment is financed by a bond market, then a situation may arise where otherwise identical countries end up with different levels of interest and different choices of technique, which again implies differences in achieved level of welfare. Under suitable conditions on the parameters of the model, the market may not be able to supply credits to one of the countries. The introduction of financial intermediaries with the ability to control the debtors may change this situation in a direction which is welfare improving (in a suitable sense) by increasing expected output in the country with high interest rates, while opening up for new problems of asymmetric information with respect to the monitoring activity of the banksCapital Outflow, Financial Intermediaries, Moral Hazard

How Likely Is Factor Price Equalization?

The idea of treating factor price equalization as a situation, where the distribution of factors among countries is compatible with an equilibrium in an integrated world economy, has been refined to give the so-called lens condition for factor price equalization. In this paper, we show that the lens condition may be used to give estimates for the probability of factor price equalization when factors are distributed randomly among countries and, in addition, the techologies are sampled according to a given probability distribution. The estimates indicate that factor price equalization may occur less often than intuitively conceived.international trade; Factor Price Equalization; lens condition

A model of trade with several countries where local integration benefits all

For the study of economic integration, it is costumary to use a three countryworld, where two of the countries may introduce forms of closer economic cooperation. In the present model, we follow this tradition but put special emphasis on the role of credit and entrepreneurship. Our model is of the standard neoclassical type, with the addition that production takes time and is subject to uncertainty. Also, firms must use the financial system in order to buy inputs; the cost of credit may differ among countries and industries, reflecting their basic patterns of uncertainty. Following the Newbery-Stiglitz approach, we show that in such model we may exhibit cases of Pareto inferior trade and, in particular, Pareto inferior economic integration. More specifically, we show that integrating countries of very different economic size may give rise to adverse effects on welfare, whereas integration of countries with a more similar economic structure and size tends to have beneficial effects for the parties. Keywords: trade, uncertainty, Pareto inferior trade, regional integration. JEL classification: F11, F15, F3

Public and Private Activity in Commercial TV Broadcasting

We consider a model of commercial television market, where private broadcasters coexist with a public television broadcaster. Assuming that the public TV station follows a policy of Ramsey pricing whereas the private stations are profit maximizers, we consider the equilibria in this market and compare with a situation where the public station is privatized and acts as another private TV broadcaster. A closer scrutiny of the market for commercial television leads to a distinction between target rating points, which are the prime unit of account in TV advertising, and net coverage, which is the final goal of advertisers. Working with net coverage as the fundamental concept, we exploit the models of competition between public and private price and quantity in order to show that privatization of the public TV station entails a welfare loss and results in TV advertising becoming more expensive. Keywords: TV broadcasting, imperfect competition, Ramsey pricing, welfare comparison. JEL classification: L11, L82, L3

Angiopoietin-like protein 4 is an exercise-induced hepatokine in humans, regulated by glucagon and cAMP

Objective: Angiopoietin-like protein-4 (ANGPTL4) is a circulating protein that is highly expressed in liver and implicated in regulation of plasma triglyceride levels. Systemic ANGPTL4 increases during prolonged fasting and is suggested to be secreted from skeletal muscle following exercise. Methods: We investigated the origin of exercise-induced ANGPTL4 in humans by measuring the arterial-to-venous difference over the leg and the hepato-splanchnic bed during an acute bout of exercise. Furthermore, the impact of the glucagon-to-insulin ratio on plasma ANGPTL4 was studied in healthy individuals. The regulation of ANGPTL4 was investigated in both hepatic and muscle cells. Results: The hepato-splanchnic bed, but not the leg, contributed to exercise-induced plasma ANGPTL4. Further studies using hormone infusions revealed that the glucagon-to-insulin ratio is an important regulator of plasma ANGPTL4 as elevated glucagon in the absence of elevated insulin increased plasma ANGPTL4 in resting subjects, whereas infusion of somatostatin during exercise blunted the increase of both glucagon and ANGPTL4. Moreover, activation of the cAMP/PKA signaling cascade let to an increase in ANGPTL4 mRNA levels in hepatic cells, which was prevented by inhibition of PKA. In humans, muscle ANGPTL4 mRNA increased during fasting, with only a marginal further induction by exercise. In human muscle cells, no inhibitory effect of AMPK activation could be demonstrated on ANGPTL4 expression. Conclusions: The data suggest that exercise-induced ANGPTL4 is secreted from the liver and driven by a glucagon-cAMP-PKA pathway in humans. These findings link the liver, insulin/glucagon, and lipid metabolism together, which could implicate a role of ANGPTL4 in metabolic diseases

Platform trials

Platform trials focus on the perpetual testing of many interventions in a disease or a setting. These trials have lasting organizational, administrative, data, analytic, and operational frameworks making them highly efficient. The use of adaptation often increases the probabilities of allocating participants to better interventions and obtaining conclusive results. The COVID-19 pandemic showed the potential of platform trials as a fast and valid way to improved treatments. This review gives an overview of key concepts and elements using the Intensive Care Platform Trial (INCEPT) as an example.</p