Capital Gains Taxes and Asset Prices: Capitalization or Lock-In?

This paper examines the impact on asset prices from a reduction in the long-term capital gains tax rate using an equilibrium approach that considers both demand and supply responses. We demonstrate that the equilibrium impact of capital gains taxes reflects both the capitalization effect (i.e., capital gains taxes decrease demand) and the lock-in effect (i.e., capital gains taxes decrease supply). Depending on time periods and stock characteristics, either effect may dominate. Using the Taxpayer Relief Act of 1997 as our event, we find evidence supporting a dominant capitalization effect in the week following news that sharply increased the probability of a reduction in the capital gains tax rate and a dominant lock-in effect in the week after the rate reduction became effective. Nondividend paying stocks (whose shareholders only face capital gains taxes) experience higher average returns during the week the capitalization effect dominates and stocks with large embedded capital gains and high tax sensitive investor ownership exhibit lower average returns during the week the lock-in effect dominates. We also find that the tax cut increases the trading volume during the week immediately before and after the tax cut becomes effective and in stocks with large embedded capital gains and high tax sensitive ownership during the dominant lock-in week.

Familial Aggregation of CKD and Heritability of Kidney Biomarkers in the General Population:The Lifelines Cohort Study

Rationale & Objective: Chronic kidney disease (CKD) has a heritable component. We aimed to quantify familial aggregation of CKD in the general population and assess the extent to which kidney traits could be explained by genetic and environmental factors. Study Design: Cross-sectional 3-generation family study. Setting & Participants: Data were collected at entry into the Lifelines Cohort Study from a sample of the general population of the northern Netherlands, composed predominantly of individuals of European ancestry. Exposure: Family history of CKD. Outcomes: The primary outcome was CKD, defined as estimated glomerular filtration rate (eGFR) Analytical Approach: Familial aggregation of CKD was assessed by calculating the recurrence risk ratio (RRR), using adapted Cox proportional hazards models. Heritability of continuous kidney-related traits was estimated using linear mixed models and defined as the ratio of the additive genetic variance to total phenotypic variance. All models were adjusted for age, sex, and known risk factors for kidney disease. Results: Among 155,911 participants with available eGFR data, the prevalence of CKD was 1.19% (1,862 cases per 155,911). The risk of CKD in those with an affected first-degree relative was 3 times higher than the risk in the total sample ( RRR, 3.04 [95% CI, 2.26-4.09). In those with an affected spouse, risk of CKD was also higher (RRR, 1.56 [95% CI, 1.20-1.96]), indicative of shared environmental factors and/or assortative mating. Heritability estimates of eGFR, UAE, and UACR were 44%, 20%, and 18%, respectively. For serum urea, creatinine, and uric acid, estimates were 31%, 37%, and 48%, respectively, whereas estimates for serum electrolytes ranged from 22% to 28%. Limitations: Use of estimated rather than measured GFR. UAE data only available in a subsample. Conclusions: In this large population-based family study, a positive family history was strongly associated with increased risk of CKD. We observed moderate to high heritability of kidney traits and related biomarkers. These results indicate an important role of genetic factors in CKD risk

External Habit and the Cyclicality of Expected Stock Returns

We estimate an equilibrium asset pricing model in which agents' preferences have an unobserved external habit using the efficient method of moments (EMM). Given the estimated structural parameters, we examine the cyclical behavior of expected stock returns in the model. We find that the estimated structural parameters imply countercyclical expected stock returns as documented in existing empirical studies. The model, however, is still rejected at the 1% level. Detailed examination of the moment conditions in our estimation indicates that the model performs reasonably well in matching the mean of returns, but it fails to capture the higher-order moments

Observational and Genetic Evidence for Bidirectional Effects Between Red Blood Cell Traits and Diastolic Blood Pressure

Background: Previous studies have found associations of red blood cell traits (hemoglobin and red blood cell count, RBC) with blood pressure; whether these associations are causal is unknown.Methods: We performed cross-sectional analyses in the Lifelines Cohort Study (n=167,785). Additionally, we performed bidirectional two sample Mendelian randomization (MR) analyses to explore the causal effect of the two traits on systolic (SBP) and diastolic blood pressure (DBP), using genetic instrumental variables regarding hemoglobin and RBC identified in UK Biobank (n=350,475) and International Consortium of Blood Pressure studies for SBP and DBP (n= 757,601).Results: In cross-sectional analyses we observed positive associations with hypertension and blood pressure for both hemoglobin (OR=1.18, 95% CI: 1.16 to 1.20 for hypertension; B=0.11, 95% CI: 0.11 to 0.12 for SBP; B=0.11, 95% CI: 0.10 to 0.11 for DBP, all per SD) and RBC (OR=1.14, 95% CI: 1.12 to 1.16 for hypertension; B=0.11, 95% CI: 0.10 to 0.12 for SBP; B=0.08, 95% CI: 0.08 to 0.09 for DBP, all per SD). MR analyses suggested that higher hemoglobin and RBC cause higher DBP (inverse variance weighted [IVW] B=0.11, 95% CI: 0.07 to 0.16 for hemoglobin; B=0.07, 95% CI: 0.04 to 0.10 for RBC, all per SD). Reverse MR analyses (all per SD) suggested causal effects of DBP on both hemoglobin (B=0.06, 95% CI: 0.03 to 0.09) and RBC (B=0.08, 95% CI: 0.04 to 0.11). No significant effects on SBP were found.Conclusions: Our results suggest bidirectional causal relationships of hemoglobin and RBC with DBP, but not with SBP

W3 Is a New Wax Locus That Is Essential for Biosynthesis of beta-Diketone, Development of Glaucousness, and Reduction of Cuticle Permeability in Common Wheat

Citation: Zhang, Z. Z., Wei, W. J., Zhu, H. L., Challa, G. S., Bi, C. L., Trick, H. N., & Li, W. L. (2015). W3 Is a New Wax Locus That Is Essential for Biosynthesis of beta-Diketone, Development of Glaucousness, and Reduction of Cuticle Permeability in Common Wheat. Plos One, 10(10), 21. doi:10.1371/journal.pone.0140524The cuticle plays important roles in plant development, growth and defense against biotic and abiotic attacks. Crystallized epicuticular wax, the outermost layer of cuticle, is visible as white-bluish glaucousness. In crops like barley and wheat, glaucousness is trait of adaption to the dry and hot cultivation conditions, and hentriacontane-14,16-dione (beta-diketone) and its hydroxy derivatives are the major and unique components of cuticular wax in the upper parts of adult plants. But their biosynthetic pathway and physiological role largely remain unknown. In the present research, we identified a novel wax mutant in wheat cultivar Bobwhite. The mutation is not allelic to the known wax production gene loci W1 and W2, and designated as W3 accordingly. Genetic analysis localized W3 on chromosome arm 2BS. The w3 mutation reduced 99% of beta-diketones, which account for 63.3% of the total wax load of the wild-type. W3 is necessary for beta-diketone synthesis, but has a different effect on beta-diketone hydroxylation because the hydroxy-beta-diketones to beta-diketone ratio increased 11-fold in the w3 mutant. Loss of beta-diketones caused failure to form glaucousness and significant increase of cuticle permeability in terms of water loss and chlorophyll efflux in the w3 mutant. Transcription of 23 cuticle genes from five functional groups was altered in the w3 mutant, 19 down-regulated and four up-regulated, suggesting a possibility that W3 encodes a transcription regulator coordinating expression of cuticle genes. Biosynthesis of beta-diketones in wheat and their implications in glaucousness formation and drought and heat tolerance were discussed.Citation: Zhang, Z., . . . & Wanlong, Li. (2015). W3 Is a New Wax Locus That Is Essential for Biosynthesis of β-Diketone, Development of Glaucousness, and Reduction of Cuticle Permeability in Common Wheat. PLoS One, 10(10), 1-21. https://doi.org/10.1371/journal.pone.014052