Essays on Exchange Rates

This dissertation consists of three essays, each examining distinct dimensions of cross-sectional variation in exchange rate changes and currency returns conditional on macroeconomic variables. Chapter 2: Protectionism, Bilateral Integration, and the Cross-Section of Ex-change Rate Returns in US Presidential Debates We study the impact of US presidential election TV debates on intraday exchange rates of 96 currencies from 1996 to 2016. Expectations about protectionist measures are the main transmission channel of debate outcomes. Currencies of countries with high levels of bilateral foreign trade with the US depreciate if the election probability of the protectionist candidate increases during the debate. We rationalize our results in a model where a debate victory of a protectionist candidate raises expectations about future tariffs and reduces future net exports to the US, resulting in relative depreciation of currencies with high bilateral trade integration. Chapter 3: Global Portfolio Network and Currency Risk Premia External portfolio investments of countries can explain cross-sectional variation in currency risk premia. Using bilateral portfolio holdings of 26 countries from 2001 to 2021, I construct a network centrality measure where a country is central if it is integrated with key countries that account for a large share in the supply of tradeable financial assets. I find that currency excess returns and interest rates decrease in network centrality. The network centralities are persistent over time and offer a country-specific economic source of risk that are able to explain robust differences in currency risk premia. Empirical asset pricing tests show that the derived risk factor is priced in a cross-section of currency portfolios. Further, negative global shocks cause currencies of central countries to appreciate, while currencies of peripheral countries depreciate. I discuss the findings with implications of a consumption-based capital asset pricing model where central countries have lower consumption growth in high marginal utility states, resulting in an appreciation of their currencies. Chapter 4: FX Dealer Constraints and External Imbalances We study the impact of FX dealer banks' financial health on the cross-sectional variation of exchange rates. Using individual balance sheet information of 39 dealers, we derive an intermediary constraints index that captures the risk-bearing capacity of intermediaries. A deterioration of the solvency of dealer banks impairs their risk-bearing capacity and increases their marginal value of wealth. We test the theoretical prediction of Gabaix and Maggiori (2015) that tightening financial constraints of intermediaries are associated with increasing currency risk premia in the cross-section of the riskiness of currencies, as measured by the net foreign assets of countries. We combine dealer-specific risks to macroeconomic fundamentals of a cross-section of currencies, i.e., the indebtedness to foreigners measured by countries' net foreign assets. We show that currency excess returns increase with a country's external imbalances when constraints are relaxed, but debtor currencies experience a depreciation when constraints tighten

Mining HCI Data for Theory of Mind Induction

Human-computer interaction (HCI) results in enormous amounts of data-bearing potentials for understanding a human user’s intentions, goals, and desires. Knowing what users want and need is a key to intelligent system assistance. The theory of mind concept known from studies in animal behavior is adopted and adapted for expressive user modeling. Theories of mind are hypothetical user models representing, to some extent, a human user’s thoughts. A theory of mind may even reveal tacit knowledge. In this way, user modeling becomes knowledge discovery going beyond the human’s knowledge and covering domain-specific insights. Theories of mind are induced by mining HCI data. Data mining turns out to be inductive modeling. Intelligent assistant systems inductively modeling a human user’s intentions, goals, and the like, as well as domain knowledge are, by nature, learning systems. To cope with the risk of getting it wrong, learning systems are equipped with the skill of reflection

Evaluating and expanding the European Union's protected-area network toward potential post-2020 coverage targets

The Convention on Biological Diversity's (CBD) strategic plan will expire in 2020, but biodiversity loss is ongoing. Scientists call for more ambitious targets in the next agreement. The nature-needs-half movement, for example, has advocated conserving half of Earth to solve the biodiversity crisis, which has been translated to protecting 50 of each ecoregion. We evaluated current protection levels of ecoregions in the territory of one of the CBD's signatories, the European Union (EU). We also explored the possible enlargement of the Natura 2000 network to implement 30 or 50 ecoregion coverage in the EU member states’ protected area (PA) network. Based on the most recent land-use data, we examined whether ecoregions have enough natural area left to reach such high coverage targets. We used a spatially explicit mixed integer programing model to estimate the least-cost expansion of the PA network based on 3 scenarios that put different emphasis on total conservation cost, ecological representation of ecosystems, or emphasize an equal share of the burden among member states. To realize 30 and 50 ecoregion coverage, the EU would need to add 6.6 and 24.2, respectively, of its terrestrial area to its PA network. For all 3 scenarios, the EU would need to designate most recommended new PAs in seminatural forests and other semi- or natural ecosystems. Because 15 ecoregions did not have enough natural area left to implement the ecoregion-coverage targets, some member states would also need to establish new PAs on productive land, allocating the largest share to arable land. Thirty percent ecoregion coverage was met by protecting remaining natural areas in all ecoregions except 3, where productive land would also need to be included. Our results support discussions of higher ecoregions protection targets for post-2020 biodiversity frameworks. © 2020 The Authors. Conservation Biology published by Wiley Periodicals, Inc. on behalf of Society for Conservation Biology

Protectionism, bilateral integration, and the cross section of exchange rate returns in US presidential debates

We study the impact of US presidential election TV debates on intraday exchange rates of 96 currencies from 1996 to 2016. Expectations about protectionist measures are the main transmission channel of debate outcomes. Currencies of countries with high levels of bilateral foreign trade with the US depreciate if the election probability of the protectionist candidate increases during the debate. We rationalize our results in a model where a debate victory of a protectionist candidate raises expectations about future tariffs and reduces future net exports to the US, resulting in relative depreciation of currencies with high bilateral trade integration

Modern radiation therapy and potential fertility preservation strategies in patients with cervical cancer undergoing chemoradiation

Young patients with cervical cancer who undergo chemoradiation might be interested in fertility preservation, not only dependent upon the use of a gestational carrier as maybe achieved by the use of ovarian transposition and cryo-conservation of oocytes or ovarian tissue, but may prefer to carry pregnancy to term after cancer treatment. The latter approach is a non- established concept needing both modern radiation therapy approaches as well as modifications -if at all possible- in current recommendations for target volume delineation to spare dose to the unaffected uterus. Future strategies to serve selected patients in this respect should only be conducted in prospective clinical evaluations and are critically discussed in this article

Costs and benefits of spatial data accuracy on comprehensive conservation planning assessments - A conceptual approach

The planning of protected habitat networks to safeguard global biodiversity requires substantial knowledge on exposure, services, and functions of ecosystems. Spatial-ecological datasets contain important information for the adequate assessment of spatial economic and ecologic interdependencies. However, these data are still lacking in many places. Comprehensive earth observation can play an important role in the provision of such data but it also involves costs. Cost-benefit analyses may answer the question whether the preparation of such comprehensive spatial data is worthwhile and may help to find the appropriate data resolution for conservation planning questions under consideration of costs. We compare several wetland data sets on global, national, and regional scale according to their spatial accuracy of wetland distribution and the costs of data survey, monitoring, and supply. The spatial data are integrated into bioeconomic land use models of different scales to assess benefits and uncertainties of increased data resolution and accuracy

On case-based learnability of languages

Case-based reasoning is deemed an important technology to alleviate the bottleneck of knowledge acquisition in Artificial Intelligence (AI). In case-based reasoning, knowledge is represented in the form of particular cases with an appropriate similarity measure rather than any form of rules. The case-based reasoning paradigm adopts the view that an Al system is dynamically changing during its life-cycle which immediately leads to learning considerations. Within the present paper, we investigate the problem of case-based learning of indexable classes of formal languages. Prior to learning considerations, we study the problem of case-based representability and show that every indexable class is case-based representable with respect to a fixed similarity measure. Next, we investigate several models of case-based learning and systematically analyze their strengths as well as their limitations. Finally, the general approach to case-based learnability of indexable classes of formal languages is prototypically applied to so-called containmet decision lists, since they seem particularly tailored to case-based knowledge processing