Real effects of money and welfare costs of inflation in an endogenously growing economy with transactions costs

Economic development ; Inflation (Finance) ; Money

Lessons from Post-colonial Malaysian Economic Development

Malaysian economic development has been shaped by public policy in response to changing national and external conditions. Public investments peaked in the 1970s and early 1980s, until the policy reversals driven by sovereign debt concerns and new policy ideology fads. Foreign investments continued to be favoured after independence for ethnic political reasons. Thus, foreign investments continued to be very significant in financial services as well as manufacturing growth, both for import substitution from the 1960s and for export from the 1970s. Private investments were attracted by government provision of infrastructure, cheap but schooled labour, tax incentives, lax environmental regulations and an undervalued currency. Poverty reduction and ownership redistribution by ethnicity were most successful during the 1970s and early 1980s, although it is unclear how much these improved inter-ethnic relations. Economic liberalization and the growing influence of business interests and political elites have undermined the government’s developmental role, culminating in the 1997–8 financial crisis and lacklustre growth since. Malaysian industrialization could only have been achieved with appropriate incentives for investments and technical progress through key policy interventions.Malaysia, development strategies, liberalization, intervention

Bounding the Greedy Strategy in Finite-Horizon String Optimization

We consider an optimization problem where the decision variable is a string of bounded length. For some time there has been an interest in bounding the performance of the greedy strategy for this problem. Here, we provide weakened sufficient conditions for the greedy strategy to be bounded by a factor of $(1-(1-1/K)^K)$, where $K$ is the optimization horizon length. Specifically, we introduce the notions of $K$-submodularity and $K$-GO-concavity, which together are sufficient for this bound to hold. By introducing a notion of \emph{curvature} $\eta\in(0,1]$, we prove an even tighter bound with the factor $(1/\eta)(1-e^{-\eta})$. Finally, we illustrate the strength of our results by considering two example applications. We show that our results provide weaker conditions on parameter values in these applications than in previous results.Comment: This paper has been accepted by 2015 IEEE CD

Government financing in an endogenous growth model with financial market restrictions

In this paper we develop an endogenous growth model with market regulations on explicitly modeled financial intermediaries to examine the effects of alternative government financing schemes on growth, inflation, and welfare. ; We find that in the presence of binding legal reserve requirements, a marginal increase in government spending need not result in a reduction in the rate of economic growth if it is financed with an increase in the seigniorage tax rate. Raising the seigniorage tax base by means of an increase in the reserve requirement retards growth and has an ambiguous effect on inflation. An increase in income tax—financed government spending also suppresses growth and raises inflation although not to the extent that the required seigniorage tax rate alternative would. Switching from seigniorage to income taxation as a source of government finance is growth-reducing but deflationary. From a welfare perspective, the least distortionary way of financing an increase in the government spending requirements is by means of a marginal increase in the seigniorage tax rate. Finally, under the specification of logarithmic preferences, the optimal tax structure is indeterminate.Finance, Public ; Fiscal policy ; Financial markets

Design of serrate-semi-circular riblets with application to skin friction reduction on engineering surface

Drag reduction in wall-bounded flows can be achieved by the passive flow control technique through the application of bio-inspired riblet surfaces. This paper presents the innovative design of Serrate-Semi-Circular riblet surfaces particularly focusing on the intrinsic relationship between the riblet features and the turbulent boundary layer structure resulting from these surfaces in engineering applications. The available experimental facilities, instrumentation (i.e. hotwire) and measurement techniques (i.e. velocity spectra) have been employed to investigate the boundary layer velocity profiles and skin friction for flat plate and Serrate-Semi-Circular riblet surfaces. Both the simulation and experimental wind tunnel testing results show that the Serrate-Semi-Circular riblet surface can provide 7% drag reduction, which is better than other riblet configurations, such as V and U shaped ones

The structural and electrical properties of thermally grown TiO2 thin films

We studied the structural and electrical properties of TiO2 thin films grown by thermal oxidation of e-beam evaporated Ti layers on Si substrates. Time of flight secondary ion mass spectroscopy (TOF-SIMS) was used to analyse the interfacial and chemical composition of the TiO2 thin films. Metal oxide semiconductor (MOS) capacitors with Pt or Al as the top electrode were fabricated to analyse electrical properties of the TiO2 thin films. We show that the reactivity of the Al top contact affects electrical properties of the oxide layers. The current transport mechanism in the TiO2 thin films is shown to be Poole–Frenkel (P–F) emission at room temperature. At 84 K, Fowler– Nordheim (F–N) tunnelling and trap-assisted tunnelling are observed. By comparing the electrical characteristics of thermally grown TiO2 thin films with the properties of those grown by other techniques reported in the literature, we suggest that, irrespective of the deposition technique, annealing of as-deposited TiO2 in O2 is a similar process to thermal oxidation of Ti thin films