The external finance premium and the macroeconomy: US post-WWII evidence

The central variable of theories of financial frictions--the external finance premium--is unobservable. This paper distils the external finance premium from a DSGE model estimated on U.S. macroeconomic data. Within the DSGE framework, movements in the premium can be given an interpretation in terms of shocks driving business cycles. A key result is that the estimate--based solely on nonfinancial macroeconomic data--picks up over 70 percent of the dynamics of lower grade corporate bond spreads. The paper also identifies a gain in fitting key macroeconomic aggregates by including financial frictions in the model and documents how shock transmission is affected.Financial markets ; Corporate bonds ; Corporations - Finance

The External Finance Premium and the Macroeconomy: US post-WWII Evidence

This paper embeds the financial accelerator into a medium-scale DSGE model and estimates it using Bayesian methods. Incorporation of financial frictions enhances the model's description of the main macroeconomic aggregates. The financial accelerator accounts for approximately ten percent of monetary policy transmission. The model-consistent premium for external finance compares well to observable proxies of the premium, such as the high-yield spread. Fluctuations in the external finance premium are primarily driven by investment supply and monetary policy shocks. In terms of recession prediction, false signals of the premium can be given an economic interpretationfinancial accelerator, external finance premium, DSGE model, Bayesian estimation

The External Finance Premium and the Macroeconomy: US post-WWII Evidence

This paper embeds the financial accelerator into a medium-scale DSGE model and estimates it using Bayesian methods. Incorporation of financial frictions enhances the model's description of the main macroeconomic aggregates. The financial accelerator accounts for approximately ten percent of monetary policy transmission. The model-consistent premium for external finance compares well to observable proxies of the premium, such as the high-yield spread. Fluctuations in the external finance premium are primarily driven by investment supply and monetary policy shocks. In terms of recession prediction, false signals of the premium can be given an economic interpretationfinancial accelerator, external finance premium, DSGE model, Bayesian estimation

Monetary policy and bank distress: an integrated micro-macro approach

Evidence on the interdependency between monetary policy and the state of the banking system is scarce. We suggest an integrated micro-macro approach with two core virtues. First, we measure the probability of bank distress directly at the bank level. Second, we integrate a microeconomic hazard model for bank distress and a standard macroeconomic model. The advantage of this approach is to incorporate micro information, to allow for non-linearities and to permit general feedback effects between bank distress and the real economy. We base the analysis on German bank and macro data between 1995 and 2004. Our results confirm the existence of a relationship between monetary policy and bank distress. A monetary contraction increases the mean probability of distress. This effect disappears when neglecting micro effects, underlining the crucial importance of the former. Distress responses are economically most significant for weak distress events and at times when capitalization is low. --Stress testing,bank distress,monetary policy

Phase diagram of a quantum Coulomb wire

We report the quantum phase diagram of a one-dimensional Coulomb wire obtained using the path integral Monte Carlo (PIMC) method. The exact knowledge of the nodal points of this system permits us to find the energy in an exact way, solving the sign problem which spoils fermionic calculations in higher dimensions. The results obtained allow for the determination of the stability domain, in terms of density and temperature, of the one-dimensional Wigner crystal. At low temperatures, the quantum wire reaches the quantum-degenerate regime, which is also described by the diffusion Monte Carlo method. Increasing the temperature the system transforms to a classical Boltzmann gas which we simulate using classical Monte Carlo. At large enough density, we identify a one-dimensional ideal Fermi gas which remains quantum up to higher temperatures than in two- and three-dimensional electron gases. The obtained phase diagram as well as the energetic and structural properties of this system are relevant to experiments with electrons in quantum wires and to Coulomb ions in one-dimensional confinement.Comment: 5 pages, 4 figure

Quality of Life in Montevideo

This paper analyzes various dimensions of the quality of life in Montevideo. The paper finds that satisfaction with various public goods and services at the neighborhood level play a minor role in the overall reported well-being of individuals and in the satisfaction of life domains, such as leisure, social life, family, health, housing, neighborhood economic situation and work. This is in spite the fact that there are significant disparities in a wide range of indicators among those living in different areas of the city. The results further suggest that differences in overall happiness and in domain satisfaction are mostly due to differences in individual outcomes like education, health, labor situation and housing quality.

Assessment of the Agri-food System for Sustainability: Recognizing Ignorance

Crop Production/Industries,

Defining T Cell Tissue Residency in Humans: Implications for HIV Pathogenesis and Vaccine Design.

Purpose of review:This review summarizes recent literature defining tissue-resident memory T cells (TRM) and discusses implications for HIV pathogenesis, vaccines, and eradication efforts.Recent findings:Investigations using animal models and human tissues have identified a TRM transcriptional profile and elucidated signals within the tissue microenvironment leading to TRM development and maintenance. TRM are major contributors to host response in infectious diseases and cancer; in addition, TRM contribute to pathogenic inflammation in a variety of settings. Although TRM are daunting to study in HIV infection, recent work has helped define their molecular signatures and effector functions and tested strategies for their mobilization. Exclusive reliance on blood sampling to gain an understanding of host immunity overlooks the contribution of TRM, which differ in significant ways from their counterparts in circulation. It is hoped that greater understanding of these cells will lead to novel approaches to prevent and/or eradicate HIV infection

Is there a metropolitan bias ? the inverse relationship between poverty and city size in selected developing countries

This paper provides evidence from eight developing countries of an inverse relationship between poverty and city size. Poverty is both more widespread and deeper in very small and small towns than in large or very large cities. This basic pattern is generally robust to choice of poverty line. The paper shows, further, that for all eight countries, a majority of the urban poor live in medium, small, or very small towns. Moreover, it is shown that the greater incidence and severity of consumption poverty in smaller towns is generally compounded by similarly greater deprivation in terms of access to basic infrastructure services, such as electricity, heating gas, sewerage, and solid waste disposal. The authors illustrate for one country -- Morocco -- that inequality within large cities is not driven by a severe dichotomy between slum dwellers and others. The notion of a single cleavage between slum residents and well-to-do burghers as the driver of urban inequality in the developing world thus appears to be unsubstantiated -- at least in this case. Robustness checks are performed to assess whether the findings in the paper are driven by price variation across city-size categories, by the reliance on an income-based concept of well-being, and by the application of small-area estimation techniques for estimating poverty rates at the town and city level.Rural Poverty Reduction,Subnational Economic Development,City Development Strategies,Regional Economic Development