Does TFP drive Housing Prices? A Growth Accounting Exercise for Four Countries

In this paper we investigate the role of technological differences between the construction sector and the general economy in the evolution of real housing prices. In particular we ask whether the recent soar in housing prices across countries reflects the different trends of total factor productivity (TFP) in the construction sector versus the other sectors. To do this, we first compare housing and construction prices in the U.S., the U.K., Germany and Spain. We find that the two prices follow a similar pattern before 1997 and diverge afterwards in all countries. Second, we perform a growth accounting exercise to measure the contribution of relative TFP on the price of construction relative to GDP for the four countries. We find evidence of a strong positive contribution of relative TFP to construction prices in the case of the United States and Germany. Instead, in the case of Spain and the U.K., relative TFP has contributed negatively to the evolution of construction prices, which have grown due to the dynamics of wages and capital returns. We conclude that in these two countries, market conditions, rather than technological factors, have been the main culprits of the recent soar in housing prices

Schumpeterian Foundations of Real Business Cycles

In this paper I propose a dynamic stochastic general quilibrium model that includes many of Schumpeter’s ideas about growth and business cycles. In this model, technology advances are due to the introduction of vertical innovations by entrepreneurs who are funded by banks. The model is solved and estimated by bayesian methods for the U.S. economy to compute the value of some of its structural parameters. Results show that the presented innovation mechanism is roughly equivalent in terms of volatilies, correlations and impulse responses to the technology shocks in real business cycle models. Notwithstanding, the model differs from traditional RBC models as it incorporates technology catch-up features that affect the convergence to the steady-state.

Schumpeterian Foundations of Real Business Cycles

Technology shocks are at the core of real business cycle models. Although tra- ditionaly described as exogenous, technology shocks can be the result of the endoge- nous decisions by economic agents under uncertainty. To demostrate it, in this paper I develop a dynamic stochastic general equilibrium model that incorporates Schum- peterian endogenous growth features that affect the convergence to the steady-state. In this model, technology advances are due to the introduction of vertical innovations by entrepreneurs who try to become monopolists in different economic sectors. En- trepreneurs? ventures are ?nanced by banks. The model is solved and estimated by bayesian methods for the United States economy to compute the value of some of its structural parameters. Results show that for a country close to the technology fron- tier, the presented innovation mechanism is roughly equivalent in terms of volatilies, correlations and impulse responses to technology shocks in real business cycle mod- els. Therefore, the behavior of the productivity can be due not only to technology considerations but also to ?nancial and entrepreneurial reasons.

Does TFP drive Housing Prices? A Growth Accounting Exercise for Four Countries

In this paper we investigate the role of technological differences between the construction sector and the general economy in the evolution of real housing prices. In particular we ask whether the recent soar in housing prices across countries reflects the different trends of total factor productivity (TFP) in the construction sector versus the other sectors. To do this, we first compare housing and construction prices in the U.S., the U.K., Germany and Spain. We find that the two prices follow a similar pattern before 1997 and diverge afterwards in all countries. Second, we perform a growth accounting exercise to measure the contribution of relative TFP on the price of construction relative to GDP for the four countries. We find evidence of a strong positive contribution of relative TFP to construction prices in the case of the United States and Germany. Instead, in the case of Spain and the U.K., relative TFP has contributed negatively to the evolution of construction prices, which have grown due to the dynamics of wages and capital returns. We conclude that in these two countries, market conditions, rather than technological factors, have been the main culprits of the recent soar in housing prices.House prices; TFP; growth accounting; Cobb-Douglas

Saudi Aramco and the oil market

We present a general equilibrium model of the global oil market, in which the oil price, oil production, and consumption, are jointly determined as outcomes of the optimizing decisions of oil importers and oil exporters. On the supply side the oil market is modelled as a dominant firm – Saudi Aramco – with competitive fringe. We establish that a dominant firm may exist as long as it enjoys a cost advantage over the fringe. We provide an expression for the optimal markup and compute the spare capacity maintained by such a firm. The model produces plausible dynamic in response to oil supply and oil demand shocks. In particular, it reproduces successfully the jump in oil output of Saudi Aramco following the output collapse of Iraq and Kuwait during the first Gulf War, explaining it as the profit-maximizing response of the dominant firm. Oil taxes and subsidies affect the oil price and welfare through their effect on the trade-off between oil production efficiency and oil market competition. JEL Classification: E32, Q43dominant firm, Oil Price, oil production, oil tax, Saudi Aramco

Learning from experience in the stock market

We study the dynamics of a Lucas-tree model with finitely lived agents who "learn from experience." Individuals update expectations by Bayesian learning based on observations from their own lifetimes. In this model, the stock price exhibits stochastic boom-and-bust fluctuations around the rational expectations equilibrium. This heterogeneous-agents economy can be approximated by a representative-agent model with constant-gain learning, where the gain parameter is related to the survival rate. JEL Classification: G12, D83, D84assett pricing, bubbles, Heterogeneous Agents, Learning from experience, OLG

Análisis y diseño de prototipo de sistema de control para compañías de transporte de carga pesada.

The research project was based on a market analysis, an analysis of how systems behave decision-making and technical analysis and this can prove that the Information Systems in a high degree conducive to the Managers or Administrators to effective decision making and information systems help the efficient management of business logistics processes in Heavy Duty Transportation. In this analysis we obtained results for the sector alarming little or no automation of logistics processes and thus administrators and managers do not have the necessary information to make decisions. The project's main purpose of planning, setting strategy and technological development of a control system such as entrepreneurship, there was a solution for companies engaged in freight operations with a comprehensive tool for managing the processes involved in this activity. The prototype of the Control System of the Transport Company to automate processes optimally to be a tool that collected the main requirements of these companies

The Role of Fundamentals in the Price of Housing. Theory and Evidence

Despite the extensive research in the field of housing economics, the role of some ‘fundamental’ economic variables, such as income, interest rates or stock of houses per capita, on the real price of housing is still not fully understood. In this paper we develop a dynamic general equilibrium model to micro-fundament the price of housing in a market without renting. In this framework we underline the dual role of housing both as a good that produces valuable services and as an investment asset that can be resold in a future date. To test the theoretical results obtained, we analyze the Spanish housing market from 1995 to 2006 as it seems to satisfy the theoretical assumptions in practice. We examine the extent to which real house prices at the regional level are driven by fundamentals by applying Panel Cointegration methods such as Common Correlated Effects, Dynamic Ordinary Least Squares and Vector Error Correction. Results are fully consistent with the theory and underline the importante of both long-run adjustment and persistence processes to explain the dynamic behaviour of prices.Panel Cointegration, housing prices, adjustment dynamics, macroeconomic model

Comparison of predicted and experimental DSC curves for vegetable oils

We compare experimental and predicted differential scanning calorimetry (DSC) curves for palm oil(PO), peanut oil (PeO) and grapeseed oil (GO). The predicted curves are computed from the solid–liquid equilibrium modelling and direct minimization of the Gibbs free energy. For PO, the lower the scan rate, the better the agreement. The temperature transitions of PeO and GO were predicted with an average deviation of −0.72°C and −1.29°C respectively, in relation to experimental data from literature. However, the predicted curves showed other peaks not reported experimentally, as computed DSC curves correspond to equilibrium hypothesis which is reached experimentally for an infinitely small scan rate. The results revealed that predicted transitions temperatures using equilibrium hypotheses can be useful in pre-experimental evaluation of vegetable oils formulations seeking for desired melting profiles