Against Amnesia: Re-Imagining Central Banking

The purpose of the present paper is to identify and challenge contemporary adherence to the core of the prevailing monetary policy consensus. This consensus consists of what we call the holy trinity of the inflation targeting paradigm: price stability as the primary goal of the central bank; central bank independence as the institutional arrangement; and the short-term interest rate as the operational target. Drawing on the literature on the history and political economy of central banking, we argue that the inability to think beyond this holy trinity stems from a severe case of collective institutional amnesia and comes at a heavy cost. We highlight that monetary policy can be deployed towards social purposes other than controlling inflation, in institutional configurations other than isolation from the rest of the government and with instruments other than interest rate manipulation. One central message is that whereas central banks are commonly portrayed as commanding only one instrument, in reality they have a battery of instruments at their disposal. We should think of central banking not as a hammer – a tool to hit inflation where it rears its ugly head – but as a Swiss army knife – a multi-purpose tool with many instruments. Doing so will help overcome the collective amnesia that stands in the way of an enlightened debate about how the power of central banking can – and perhaps should – be harnessed in the pursuit of collective social goals.1 Introduction 2 The Holy Trinity 3 Historical Specificity 3.1 Pre-War 3.2 Post-War, Pre-Inflation 3.3 Holy Trinity 3.4 Shoring up the Holy Trinity: The Tinbergen Rule 4 Beyond the Tinbergen Rule: A Swiss Army Knife Theory of Central Banking 4.1 Lender of Last Resort 4.2 Financial Market-Shaping I: Monetary Policy Implementation 4.3 Financial Market-Shaping II: Monetary Policy Transmission 5 Conclusion Reference

Modeling the Void H I Column Density Spectrum

The equivalent width distribution function (EWDF) of \hone absorbers specific to the void environment has been recently derived (Manning 2002), revealing a large line density of clouds (dN/dz ~500 per unit z for Log (N_HI)> 12.4). I show that the void absorbers cannot be diffuse (or so-called filamentary) clouds, expanding with the Hubble flow, as suggested by N-body/hydro simulations. Absorbers are here modeled as the baryonic remnants of sub-galactic perturbations that have expanded away from their dark halos in response to reionization at z ~ 6.5. A 1-D Lagrangian hydro/gravity code is used to follow the dynamic evolution and ionization structure of the baryonic clouds for a range of halo circular velocities. The simulation products at z=0 can be combined according to various models of the halo velocity distribution function to form a column density spectrum that can be compared with the observed. I find that such clouds may explain the observed EWDF if the halo velocity distribution function is as steep as that advanced by Klypin (1999), and the halo mass distribution is closer to isothermal than to NFW.Comment: 21 pages, 15 figures. Paper in press; ApJ 591, n

The B-L/Electroweak Hierarchy in Smooth Heterotic Compactifications

E8 X E8 heterotic string and M-theory, when appropriately compactified, can give rise to realistic, N=1 supersymmetric particle physics. In particular, the exact matter spectrum of the MSSM, including three right-handed neutrino supermultiplets, one per family, and one pair of Higgs-Higgs conjugate superfields is obtained by compactifying on Calabi-Yau manifolds admitting specific SU(4) vector bundles. These "heterotic standard models" have the SU(3)_{C} X SU(2)_{L} X U(1)_{Y} gauge group of the standard model augmented by an additional gauged U(1)_{B-L}. Their minimal content requires that the B-L gauge symmetry be spontaneously broken by a vacuum expectation value of at least one right-handed sneutrino. In a previous paper, we presented the results of a renormalization group analysis showing that B-L gauge symmetry is indeed radiatively broken with a B-L/electroweak hierarchy of O(10) to O(10^{2}). In this paper, we present the details of that analysis, extending the results to include higher order terms in tan[beta]^{-1} and the explicit spectrum of all squarks and sleptons.Comment: 60 pages, 6 figure

Seasonal Solow residuals and Christmas: a case for labor hoarding and increasing returns

In aggregate unadjusted data, measured Solow residuals exhibit large seasonal variations. Total Factor Productivity grows rapidly in the fourth quarter at an annual rate of 16 percent and regresses sharply in the first quarter at an annual rate of ?24 percent. This paper considers two potential explanations for the measured seasonal variation in the Solow residual: labor hoarding and increasing returns to scale. Using a specification that allows for no exogenous seasonal variation in technology and a single seasonal demand shift in the fourth quarter, we ask the following question: How much of the total seasonal variation in the measured Solow residual can be explained by Christmas? The answer to this question is surprising. With increasing returns and time varying labor effort, Christmas is sufficient to explain the seasonal variation in the Solow residual, consumption, average productivity, and output in all four quarters. Our analysis of seasonally unadjusted data uncovers important roles for labor hoarding and increasing returns which are difficult to identify in adjusted data.Seasonal variations (Economics)

The Exact MSSM Spectrum from String Theory

We show the existence of realistic vacua in string theory whose observable sector has exactly the matter content of the MSSM. This is achieved by compactifying the E_8 x E_8 heterotic superstring on a smooth Calabi-Yau threefold with an SU(4) gauge instanton and a Z_3 x Z_3 Wilson line. Specifically, the observable sector is N=1 supersymmetric with gauge group SU(3)_C x SU(2)_L x U(1)_Y x U(1)_{B-L}, three families of quarks and leptons, each family with a right-handed neutrino, and one Higgs-Higgs conjugate pair. Importantly, there are no extra vector-like pairs and no exotic matter in the zero mode spectrum. There are, in addition, 6 geometric moduli and 13 gauge instanton moduli in the observable sector. The holomorphic SU(4) vector bundle of the observable sector is slope-stable.Comment: 15 pages, LaTeX; v2: Hidden sector is unstable, symbol typesetting error corrected, clarifications and references added; v3: New discussion of hidden secto

The leading-twist pion and kaon distribution amplitudes from the QCD instanton vacuum

We investigate the leading-twist light-cone distribution amplitudes for the pion and kaon, based on the nonlocal chiral quark model from the instanton vacuum. Effects of explicit flavor SU(3)-symmetry breaking are taken into account. The Gegenbauer moments are computed, analyzed and compared with those of other models. The one-loop QCD evolution of the moments is briefly discussed. The transverse momentum distributions are also discussed for the pion and kaon light-cone wave functions.Comment: 17 pages, 12 figures. Accepted for publication in Physical Review

Runoff modelling in glacierized Central Asian catchments for present-day and future climate

A conceptual precipitation–runoff model was applied in five glacierized catchments in Central Asia. The model, which was first developed and applied in the Alps, works on a daily time step and yields good results in the more continental climate of the Tien Shan mountains for present-day climate conditions. Runoff scenarios for different climates (doubling of CO2) and glacierization conditions predict an increased flood risk as a first stage and a more complex picture after a complete glacier loss: a higher discharge during spring due to an earlier and more intense snowmelt is followed by a water deficiency in hot and dry summer periods. This unfavourable seasonal redistribution of the water supply has dramatic consequences for the Central Asian lowlands, which depend to a high degree on the glacier melt water for irrigation and already nowadays suffer from water shortages