Does the euro make a difference? Spatio-temporal transmission of global shocks to real effective exchange rates in an infinite VAR

This paper provides evidence on whether the creation of the euro has changed the way global turbulences affect euro area and other economies. Specifically, it considers the impact of global shocks on the competitiveness of individual euro area countries and assesses whether their responses to such shocks have converged, as well as to what pattern. Technically, the paper applies a newly developed methodology based on infinite VAR theory featuring a dominant unit to a large set of over 60 countries' real effective exchange rates, including those of the individual euro area economies, and compares impulse response functions to the estimated systems before and after EMU with respect to three types of shocks: a global US dollar shock, generalised impulse response function shocks and a global shock to risk aversion. Our results show that the way euro area countries' real effective exchange rates adjust to these shocks has converged indeed, albeit to a pattern that depends crucially on the nature of the shock. This result is noteworthy given the apparent divergence in competitiveness indicators of these countries in the first ten years of EMU, which suggests that this diverging pattern is unlikely to be due to global external shocks with asymmetric effects but rather to other factors, such as country-specific domestic shocks. JEL Classification: C21, C23euro, High-Dimensional VAR, Identification of Shocks, Real Effective Exchange Rates, Weak and Strong Cross Sectional Dependence

Human Rights Violations After 9/11 and the Role of Constitutional Constraints

human rights, terrorism, 9/11, checks and balances, constitutions, constitutional courts

Assessing the Market for Poultry Litter in Georgia: Are Subsidies Needed to Protect Water Quality?

Concerns about nutrient loads into our waters have focused attention on poultry litter applications. Like many states with a large poultry industry, Georgia recently designed a subsidy program to facilitate the transportation of poultry litter out of vulnerable watersheds. This paper uses a transportation model to examine the necessity of a poultry litter subsidy to achieve water protection goals in Georgia. We also demonstrate the relationship between diesel and synthetic fertilizer prices and the value of poultry litter. Results suggest that a well functioning market would be able to remove excess litter from vulnerable watersheds in the absence of a subsidy.fertilizer, phosphorous, poultry litter, subsidy, transportation model, water quality, Environmental Economics and Policy, Marketing, Q12, Q13, Q25, Q53,

Does Finance Bolster Superstar Companies? Banks, Venture Capital, and Firm Size in Local U.S. Markets

We study the relative effect of venture capital and bank finance on large manufacturing firms in local U.S. markets. Theory predicts that with venture capital, the firm size distribution should become more stretched-out to the right, but it’s ambiguous on the effect of banks on large firms. The empirical evidence suggests that while the average size of firms in the top bin of the firm size distribution has remained unaffected by banking sector developments, it has increased with venture capital investment. We argue that this is due to the emergence of new corporate giants rather than the growth of existing ones. JEL Classification: G24, J24, L11banking, firm size, Venture Capital

Have euro area and EU economic governance worked? Just the facts

We test whether two key elements of the EU and euro area economic governance framework, the Stability and Growth Pact and the Lisbon Strategy, have had any impact on macroeconomic outcomes. We test this proposition using a difference-in-difference approach on a panel of over 30 countries, some of which are non-EU (control group). Hence, the impact of the EU economic governance pillars is evaluated based on both the performance before and after their application as well as against the control group. We find strong and robust evidence that neither the Stability and Growth Pact nor the Lisbon Strategy have had a significant beneficial impact on fiscal and economic performance outcomes. We conclude that a profound reform of these pillars is needed to make them work in the next decade. JEL Classification: E62, E63, H63, O43euro area, European Union, governance, institutions, Lisbon Strategy, Stability and Growth Pact

Crystal structure of [μ2-1,1′-bis(diphenylphosphanyl)ferrocene-κ2P:P′]bis[(pyrrolidine-1-carbodithioato-κS)gold(I)]

The asymmetric unit of the title compound, {(C34H28FeP2)[Au(C5H8NS2)]2}, comprises half a molecule, with the full molecule being generated by the application of a centre of inversion. The independent AuI atom is coordinated by thiolate S and phosphane P atoms that define an approximate linear geometry [S—Au—P = 169.35 (3)°]. The deviation from the ideal linear is traced to the close approach of the (intramolecular) non-coordinating thione S atom [Au...S = 3.1538 (8) Å]. Supramolecular layers parallel to (100) feature in the crystal packing, being sustained by phenyl–thione C—H...S interactions, with the non-coordinating thione S atom in the role of a dual acceptor. Layers stack with no specific interactions between them

Supersymmetry breaking, open strings and M-theory

We study supersymmetry breaking by Scherk-Schwarz compactifications in type I string theory. While in the gravitational sector all mass splittings are proportional to a (large) compactification radius, supersymmetry remains unbroken for the massless excitations of D-branes orthogonal to the large dimension. In this sector, supersymmetry breaking can then be mediated by gravitational interactions alone, that are expected to be suppressed by powers of the Planck mass. The mechanism is non perturbative from the heterotic viewpoint and requires a compactification radius at intermediate energies of order 10^{12}-10^{14} GeV. This can also explain the value of Newton's constant if the string scale is close to the unification scale, of order 10^{16} GeV.Comment: 47 pages, LaTeX, typos correcte

Discourse comprehension in L2: Making sense of what is not explicitly said

Using ERPs, we tested whether L2 speakers can integrate multiple sources of information (e.g., semantic, pragmatic information) during discourse comprehension. We presented native speakers and L2 speakers with three-sentence scenarios in which the final sentence was highly causally related, intermediately related, or causally unrelated to its context; its interpretation therefore required simple or complex inferences. Native speakers revealed a gradual N400-like effect, larger in the causally unrelated condition than in the highly related condition, and falling in-between in the intermediately related condition, replicating previous results. In the crucial intermediately related condition, L2 speakers behaved like native speakers, however, showing extra processing in a later time-window. Overall, the results show that, when reading, L2 speakers are able to process information from the local context and prior information (e.g., world knowledge) to build global coherence, suggesting that they process different sources of information to make inferences online during discourse comprehension, like native speakers.This work was supported by grants from the Spanish Government (PSI2011-23033, CONSOLIDER-INGENIO2010 CSD2007-00048, ECO2011-25295, and ECO2010-09555-E), from the Catalan Government (SGR 2009-1521) and from the Grup de Recerca en Neurociència Cognitiva (GRNC) - 2014SGR1210. It has also received funding from the European Union’s Seventh Framework Programme for research, technological development and demonstration under grant agreement no. 613465

Productivity shocks and real exchange rate: a reappraisal

We reappraise the relationship between productivity and equilibrium real exchange rates using a panel estimation framework that incorporates a large number of countries and importantly, a dataset that allows explicit consideration of the role of non-traded, as well as traded, sector productivity shocks in exchange rate determination. We find evidence of significant correlation between real exchange rates and productivity differentials in both sectors. But our finding of a significant role for the non-traded sector in exchange rate determination, and of a relatively larger correlation between exchange rates and productivity shocks of a given size emanating from this sector, represent clear contradictions of the widely cited Balassa-Samuelson hypothesis. Our findings remain valid in the face of a number of robustness tests, including the exchange rate regime and numéraire currency