Sovereign risk, private credit, and stabilization policies

In this paper we examine the impact of bailout policies in small open economies that are subject to financial frictions. We extend standard endogenous default models in two ways. First, we augment the government’s choice set with a bailout option. In addition to the standard choice of defaulting or repaying the debt, a government can also choose to ask for third-party bailout, which comes at a cost of an imposed borrowing limit. Second, we introduce financial frictions and a financial intermediation channel, which tie conditions on the private credit market to the conditions on the sovereign credit market. This link has been very strong in European countries during the recent sovereign crisis. We find that the existence of a bailout option reduces sovereign spreads and, through the described link, private credit rates as well. The implementation of a rescue program reduces output losses and increases welfare, measured in consumption equivalent terms. Moreover, bailout benefits emerge even when a government only has the option of asking for a bailout, but does not take advantage of it

The Krzyż conjecture revisited

The Krzyz conjecture concerns the largest values of the Taylor coefficients of a non-vanishing analytic function bounded by one in modulus in the unit disk. It has been open since 1968 even though information on the structure of extremal functions is available. The purpose of this paper is to collect various conditions that the coefficients of an extremal function (and various other quantities associated with it) should satisfy if the conjecture is true and to show that each one of these properties is equivalent to the conjecture itself. This may provide several possible starting points for future attempts at solving the problemThe first, third and fourth authors thankfully acknowledge partial support from MINECO grant MTM2012-37436-C02-02, Spain. Starting in 2014 the first author was supported by Academy of Finland grant 268009. The second author was supported by NSERC, Canada. The third author was also supported by NSF grant DMS-0901524, by NSF CAREER, Award No. DMS-1056965, and Sloan Research Fellowship, USA. The fourth author was partially supported by the European ESF Network HCAA (“Harmonic and Complex Analysis and Its Applications”) during the period November 2009 - April 201

Updated radio Σ−D\Sigma-D relation for Galactic supernova remnants

We present updated empirical radio surface-brightness-to-diameter ($\Sigma-D$) relation for supernova remnants (SNRs) in our Galaxy. Our original calibration sample of Galactic SNRs with independently determined distances (Pavlovic et al. 2013, hereafter Paper I) is reconsidered and updated with data which became available in the past two years. The orthogonal fitting procedure and probability-density-function-based (PDF) method are applied to the calibration sample in the $\log \Sigma - \log D$ plane. Orthogonal regression keeps $\Sigma-D$ and $D-\Sigma$ relations invariant. Our previous Monte Carlo simulations verified that the slopes of the empirical $\Sigma-D$ relation should be determined by using orthogonal regression. Updated calibration sample contains 65 shell SNRs. 6 new Galactic SNRs are added to the sample from Paper I, one is omitted and distances are changed for 10 SNRs. The slope derived here is slightly steeper ($\beta \approx 5.2$) than $\Sigma-D$ slope in Paper I ($\beta \approx 4.8$). The PDF method relies on data points density maps which can provide more reliable calibrations that preserve more information contained in the calibration sample. We estimate distances to five new faint Galactic SNRs discovered for the first time by Canadian Galactic Plane Survey and obtained distances of 2.3, 4.0, 1.3, 2.9 and 4.7 kiloparsecs for G108.5+11.0, G128.5+2.6, G149.5+3.2, G150.8+3.8 and G160.1$-$1.1, respectively. The updated empirical relation is used to estimate distances of 160 shell Galactic SNRs and new results change their distance scales up to 15 per cent, compared to results from Paper I. The PDF calculation can provide even few times higher or lower values in comparison with orthogonal fit, as it uses totally different approach. However, in average, this difference is 32, 24 and 18 per cent for mode, median and mean distances.Comment: 17 pages, 3 figures, Accepted for publication in Serbian Astronomical Journa

The orthogonal fitting procedure for determination of the empirical {\Sigma} - D relations for supernova remnants: application to starburst galaxy M82

The radio surface brightness-to-diameter ({\Sigma} - D) relation for supernova remnants (SNRs) in the starburst galaxy M82 is analyzed in a statistically more robust manner than in the previous studies that mainly discussed sample quality and related selection effects. The statistics of data fits in log {\Sigma} - log D plane are analyzed by using vertical (standard) and orthogonal regressions. As the parameter values of D - {\Sigma} and {\Sigma} - D fits are invariant within the estimated uncertainties for orthogonal regressions, slopes of the empirical {\Sigma} - D relations should be determined by using the orthogonal regression fitting procedure. Thus obtained {\Sigma} - D relations for samples which are not under severe influence of the selection effects could be used for estimating SNR distances. Using the orthogonal regression fitting procedure {\Sigma} - D slope {\beta} \approx 3.9 is obtained for the sample of 31 SNRs in M82. The results of implemented Monte Carlo simulations show that the sensitivity selection effect does not significantly influence the slope of M82 relation. This relation could be used for estimation of distances to SNRs that evolve in denser interstellar environment, with number denisty up to 1000 particles per cm3 .Comment: 14 pages, 3 figures, no changes, previous version had a typo in publication related comment, accepted for publication in Ap

Mirko Kujačić and social art in Serbia

The art of the fourth decade of the twentieth century which, as if it was announcing the World War II, was polarized between so-called 'pure art' (l'art pour l'art), engaged art (l'art pour l'idee), and war realism. This separation often caused ideological conflicts that were intensifying and spreading into the sphere of political conflicts. Two models of the leftist ideological concepts are reflected into the socially engaged artistic work of the two programmatically declared groups, which were devoted to an engaged form of artistic activity: the group 'Earth' (1929-1935) from Zagreb and the group 'Life' (1932-1940) from Belgrade. Social art in Serbia had strong foundations in the second half of the third decade of the twentieth century and stretched throughout the period of war events until 1943. In the period between the two world wars it started with The Manifest of Mirko Kujačić, (1901-1987) published in 1932 and an exhibition of his surrealistic collages, framed shoes, an object named The Winter Motif and its counterpart, the painting named The Root of Belgrade Gentility. An important event for the continuation of such artistic tendencies was the forming of the group Life in 1934 in Belgrade, with Kujačić as one of the founders and the main protagonist

Radio Planetary Nebulae in the Magellanic Clouds

We present preliminary results of our deep Australia Telescope Compact Array (ATCA) radio-continuum survey of the Magellanic Clouds Planetary Nebulae.Comment: 2 pages 1 figure, to appear in Planetary Nebulae an Eye to the Future Proceedings IAU Symposium No. 28

Welfare gains of bailouts in a sovereign default model

We examine the welfare effects of bailouts in economies exposed to sovereign default risk. When a government of a small open economy requests a bailout from an international financial institution, it receives a non-defaultable loan of size G that comes with imposed debt limits. The government endogenously asks for the bailout during recessions and repays it when the economy recovers. Hence, the bailout acts as an imperfect state contingent asset that makes the economy better off. The bailout duration is endogenous and increases with its size. The bailout size creates non-trivial tradeoffs between receiving a larger amount of relatively cheap resources precisely in times of need on the one hand, and facing longer-lasting financial constraints and accumulated interest payments, on the other hand. We characterize and quantify these tradeoffs and document that welfare gains of bailouts are hump-shaped in the size of bailout loans