The Svensson versus McCallum and Nelson Controversy Revisited in the BMW Framework

This note shows that the Svensson versus McCallum and Nelson controversy battled in the Federal Reserve Bank of St. Loius Review (September/ October 2005) can be mapped into a static version of a New Keynesian macro model that consists of an IS-equation, a Phillips curve and an inflation targeting central bank (e.g., Bofinger, Mayer, Wollmershäuser, (2006); Walsh (2002)). As a contribution to literature we supplement the controversy by a forceful graphical analysis. The general debate centers on the question by which notion monetary policy should be implemented. The two sides have fundamentally opposite views on this issue. Svensson argues for targeting rules as a notion of optimal monetary policy, whereas McCallum and Nelson promote simple instrument rules. In this note we systematically analyze these two categories of monetary policy rules. In particular we show that the rule discussed by McCallum and Nelson (2005) imposes different degrees of variability on the economy compared to a targeting rule when monetary policy falls prey to measurement error. To our opinion the hybrid Taylor rule developed by McCallum and Nelson contradicts the original idea of simple rules as a heuristic for monetary policy making and should be rebutted for practical reasons

Is Neolithic land use correlated with demography? An evaluation of pollen-derived land cover and radiocarbon-inferred demographic change from Central Europe

The transformation of natural landscapes in Middle Europe began in the Neolithic as a result of the introduction of food-producing economies. This paper examines the relation between land-cover and demographic change in a regionally restricted case study. The study area is the Western Lake Constance area which has very detailed palynological as well as archaeological records. We compare land-cover change derived from nine pollen records using a pseudo-biomisation approach with 14C date probability density functions from archaeological sites which serve as a demographic proxy. We chose the Lake Constance area as a regional example where the pollen signal integrates a larger spatial pattern. The land-cover reconstructions for this region show first notable impacts at the Middle to Young Neolithic transition. The beginning of the Bronze Age is characterised by increases of arable land and pasture/meadow, whereas the deciduous woodland decreases dramatically. Changes in the land-cover classes show a correlation with the 14C density curve: the correlation is best with secondary woodland in the Young Neolithic which reflects the lake shore settlement dynamics. In the Early Bronze Age, the radiocarbon density correlates with open land-cover classes, such as pasture, meadow and arable land, reflecting a change in the land-use strategy. The close overall correspondence between the two archives implies that population dynamics and land-cover change were intrinsically linked. We therefore see human impact as a key driver for vegetation change in the Neolithic. Climate might have an influence on vegetation development, but the changes caused by human land use are clearly detectable from Neolithic times, at least in these densely settled, mid-altitude landscapes

Tunable Semiconducting Polymer Nanoparticles with INDT-Based Conjugated Polymers for Photoacoustic Molecular Imaging.

Photoacoustic imaging combines both excellent spatial resolution with high contrast and specificity, without the need for patients to be exposed to ionizing radiation. This makes it ideal for the study of physiological changes occurring during tumorigenesis and cardiovascular disease. In order to fully exploit the potential of this technique, new exogenous contrast agents with strong absorbance in the near-infrared range, good stability and biocompatibility, are required. In this paper, we report the formulation and characterization of a novel series of endogenous contrast agents for photoacoustic imaging in vivo. These contrast agents are based on a recently reported series of indigoid π-conjugated organic semiconductors, coformulated with 1,2-dipalmitoyl-sn-glycero-3-phosphocholine, to give semiconducting polymer nanoparticles of about 150 nm diameter. These nanoparticles exhibited excellent absorption in the near-infrared region, with good photoacoustic signal generation efficiencies, high photostability, and extinction coefficients of up to three times higher than those previously reported. The absorption maximum is conveniently located in the spectral region of low absorption of chromophores within human tissue. Using the most promising semiconducting polymer nanoparticle, we have demonstrated wavelength-dependent differential contrast between vasculature and the nanoparticles, which can be used to unambiguously discriminate the presence of the contrast agent in vivo

Monetary and Fiscal Policy Interaction in the Euro Area with Different Assumptions on the Phillips Curve

In this paper we carry over a static version of a New Keynesian Macro Model to a monetary union. For a similar approach see Uhlig (2002). We will show in particular that a harmonious functioning of a monetary union critically depends on the correlation structure of shocks that hit the currency area. Additionally a high degree of integration in product markets is advantageous for the ECB as it prevents that national real interest rates can drive a wedge between macroeconomic outcomes across member states. In particular small countries are in a vulnerable and therefore in need for fiscal policy as an independent stabilization agent with room to breath

Solution of the Bethe-Salpeter equation for pion-nucleon scattering

A relativistic description of pion-nucleon scattering based on the four-dimensional Bethe-Salpeter equation is presented. The kernel of the equation consists of s- and u-channel nucleon and delta pole diagrams, as well as rho and sigma exchange in the t-channel. The Bethe-Salpeter equation is solved by means of a Wick rotation, and good fits are obtained to the s- and p-wave phase shifts up to 360 MeV pion laboratory energy. The coupling constants determined by the fits are consistent with the commonly accepted values in the literature.Comment: 34 pages, RevTeX; 7 figures. Several references added, a few typos corrected. Accepted for publication in Physical Review

Barro-Gordon Revisited: Reputational Equilibria in a New Keynesian Model

The aim of this paper is to solve the inconsistency problem à la Barro and Gordon within a New Keynesian model and to derive time-consistent (stable) interest rate rules of Taylor-type. We find a multiplicity of stable rules. In contrast to the Kydland/Prescott-Barro/Gordon approach, implementing a monetary rule where the cost and benefit resulting from inconsistent policy coincide - which implies a net gain of inconsistent policy behavior equal to zero - is not optimal. Instead, the solution can be improved by moving into the time-consistent area where the net gain of inconsistent policy is negative. We moreover show that under a standard calibration, the standard Taylor rule is stable in the case of a cost-push shock as well as under simultaneous supply and demand shocks

Fiscal and Monetary Policy Determinants of the Eurozone Crisis and Its Resolution

Unlike the crisis years of 2007-2009 (when the insolvency of large banks was a major problem), the current round of the global financial crisis has fiscal origins. Almost all developed countries suffer from an excessive public debt burden that has been built up over the last two decades or more. The financial crisis caused a further deterioration of government accounts as a result of ill-tailored countercyclical fiscal response and, in some cases, a costly financial sector rescue. All excessively indebted countries must conduct fiscal adjustment, even if this involves economic and political costs in terms of lower output and higher unemployment. Central banks can reduce these costs through accommodative monetary policies but without compromising their anti-inflationary missions and institutional independence. The ECB is additionally constrained by its institutional status which is based on a delicate cross-country political consensus. Excessive ECB involvement in quasi-fiscal rescue operations can undermine this consensus and lead to a disintegration of the Eurozone. There are also strong arguments in favor of strengthening fiscal and banking integration within the EU, especially the fiscal discipline mechanism at national levels, and building the EU rescue capacity in respect to sovereigns and banks based on strong policy conditionality

Exchange Rate Risk and Convergence to the Euro

This paper proposes a new monetary policy framework for effectively navigating the path to adopting the euro. The proposed policy is based on relative inflation forecast targeting and incorporates an ancillary target of declining exchange rate risk, which is suggested as a key criterion for evaluating the currency stability. A model linking exchange rate volatility to differentials over the euro zone in both inflation (target variable) and interest rate (instrument variable) is proposed. The model is empirically tested for the Czech Republic, Poland and Hungary, the selected new Member States of the EU that use direct inflation targeting to guide their monetary policies. The empirical methodology is based on the TARCH(p,q,r)-M model

Exchange Rate Policy and Inflation Targeting in Colombia

This paper examines Colombia`s experience with an inflation-targeting monetary policy following the abandonment of exchange rate bands in 1999, and two episodes in 2003 and 2004 that deviated from this general behavior. In these episodes, the Central Bank intervened in the forex market on a relatively large scale in order to affect the trend of the exchange rate (managed floating). These episodes are examined to draw lessons and highlight the main challenges facing monetary and forex policy. The rationale for central bank intervention in the forex market in Colombia is then critically discussed. Finally, the paper presents several issues that appear in the debate on Colombian monetary and forex policy and provides an idea of the political context in which monetary policy decisions are made

Development of lipopolyplexes for gene delivery: a comparison of the effects of differing modes of targeting peptide display on the structure and transfection activities of lipopolyplexes

The design, synthesis and formulation of non‐viral gene delivery vectors is an area of renewed research interest. Amongst the most efficient non‐viral gene delivery systems are lipopolyplexes, in which cationic peptides are co‐formulated with plasmid DNA and lipids. One advantage of lipopolyplex vectors is that they have the potential to be targeted to specific cell types by attaching peptide targeting ligands on the surface, thus increasing both the transfection efficiency and selectivity for disease targets such as cancer cells. In this paper, we have investigated two different modes of displaying cell‐specific peptide targeting ligands at the surface of lipopolyplexes. Lipopolyplexes formulated with bimodal peptides, with both receptor binding and DNA condensing sequences, were compared with lipopolyplexes with the peptide targeting ligand directly conjugated to one of the lipids. Three EGFR targeting peptide sequences were studied, together with a range of lipid formulations and maleimide lipid structures. The biophysical properties of the lipopolyplexes and their transfection efficiencies in a basal‐like breast cancer cell line were investigated using plasmid DNA bearing genes for the expression of firefly luciferase and green fluorescent protein. Fluorescence quenching experiments were also used to probe the macromolecular organisation of the peptide and pDNA components of the lipopolyplexes. We demonstrated that both approaches to lipopolyplex targeting give reasonable transfection efficiencies, and the transfection efficiency of each lipopolyplex formulation is highly dependent on the sequence of the targeting peptide. To achieve maximum therapeutic efficiency, different peptide targeting sequences and lipopolyplex architectures should be investigated for each target cell type