Testing the BalassA-Samuelson hypothesis in two different groups of countries: OECD and Latin America

This paper studies the Balassa-Samuelson hypothesis (BSH) in the context of two areas with strong differences in economic development, twelve OECD countries and twelve Latin American economies, taking the USA as the benchmark. Applying panel cointegration techniques, we find that while the first stage of the hypothesis, which links productivities and prices, is satisfied in each group of countries, the second stage, which relates relative sector prices with the real exchange rate, only holds in the Latin American area. The failure of the latter in the OECD countries as a whole is reflected in departures from PPP in the tradable sectors.Balassa-Samuelson effect, Panel cointegration, Economic development, Exchange rate systems

Demand shocks and trade balance dynamics

This paper studies the current account dynamics in the G-7 countries plus Spain. We estimate a SVAR model which allows us to identify three different shocks: supply shocks, real demand shocks and nominal shocks. We use a different identification procedure from previous work based on a microfounded stochastic open-economy model in which the real exchange rate is a determinant of the Phillips curve. Estimates from a structural VAR show that real demand shocks explain most of the variability of current account imbalances, whereas, contrary to previous findings, nominal shocks play no role. The results we obtain are consistent with the predictions of a widely set of open-economy models and illustrate that demand policies are the main responsible of trade imbalances.Current account, SVAR

Demand Shocks and Trade Balance Dynamics

This paper studies the current account dynamics in the G-7 countries plus Spain. We estimate a SVAR model which allows us to identify three different shocks: supply shocks, real demand shocks and nominal shocks. We use a different identification procedure from previous work based on a microfounded stochastic open-economy model in which the real exchange rate is a determinant of the Phillips curve. Estimates from a structural VAR show that real demand shocks explain most of the variability of current account imbalances, whereas, contrary to previous findings, nominal shocks play no role. The results we obtain are consistent with the predictions of a widely set of open-economy models and illustrate that demand policies are the main responsible of trade imbalances.Current account, SVAR.

The over-evaluation of the real exchange rate of the Spanish economy

En la primera parte de este trabajo se aplica el modelo de bienes comercializables y no comercializables para caracterizar los desequilibrios principales de la economía española y deducir la ecuación que fundamenta el «Efecto Penn». En la segunda parte se estima esa ecuación con datos anuales de sección transversal para dos amplias muestras de países y para cada uno de los años del periodo 2000-2009. Se obtiene que en 2002 el tipo de cambio real de la economía española inició un proceso de sobrevaloración frente al resto del mundo que alcanzó su máximo en 2008 (entre el 27% y 29% ). En 2009, se redujo a un nivel entre el 17% y el 19% por el impacto deflacionario de la crisis económica. El trabajo analiza los desequilibrios que acompañaron a este desajuste, y deduce algunas prescripciones de política económica para contrarrestarlos y/o resolverlosIn the first part of this work we apply tradables and non-tradables model to characterise the main economic imbalances of the Spanish economy and to derive the equation that rationalizes and supports the Penn effect. In the second part, we estimate the Penn effect equation using annual cross-sectional data ot two large samples of countries for each year of the period 2000-2009. We observe that real exchange rate of the Spanish economy with respect of rest of the world started an overvalaution rate dropped to 17%-19% in 2009, as result of the deflationary impact of the finnacial crisis. We analyse the the economic imbalances that accompany this misalignment, and deduce some policy prescriptions to solve themLos autores agradecen la ayuda financiera de la Fundación Séneca, «Ayudas para la realización de proyectos de investigación en Humanidades y Ciencias Sociales», proyecto 15183/PHCS/1

Beyond the Salassa-Samuelson Effect in some New Member States of the European Union

This paper analyses the Balassa and Samuelson hypothesis in two groups of European countries: six New Member States (NMS) and six advanced EU-15 economies. It is found that the second stage of the hypothesis, which relates relative sector prices with the real exchange rate, does not hold anywhere. In the NMS the main reasons are increased demand for domestic tradables stemming from positive differentials in economic growth, probably coupled with quality improvements in domestic tradable goods. In the EU-15, the explanatory factor is segmentation between national markets of tradables, caused by transportation costs, non-tariff barriers and imperfect competition between firms.Balassa-Samuelson effect, panel cointegration, economic transition, market segmentation, quality bias

Forming first-ranked early-type galaxies through hierarchical dissipationless merging

We have developed a computationally competitive N-body model of a previrialized aggregation of galaxies in a flat Λ cold dark matter Universe to assess the role of the multiple mergers that take place during the formation stage of such systems in the configuration of the remnants assembled at their centres. An analysis of a suite of 48 simulations of low-mass forming groups (Mtot,gr ∼ 1013 h−1 M⊙) demonstrates that the gravitational dynamics involved in their hierarchical collapse is capable of creating realistic first-ranked galaxies without the aid of dissipative processes. Our simulations indicate that the brightest group galaxies (BGGs) constitute a distinct population from other group members, sketching a scenario in which the assembly path of these objects is dictated largely by the formation of their host system. We detect significant differences in the distribution of Sérsic indices and total magnitudes, as well as a luminosity gap between BGGs and the next brightest galaxy that is positively correlated with the total luminosity of the parent group. Such gaps arise from both the grow of BGGs at the expense of lesser companions and the decrease in the relevance of second-ranked objects in equal measure. This results in a dearth of intermediate-mass galaxies which explains the characteristic central dip detected in their luminosity functions in dynamically young galaxy aggregations. The fact that the basic global properties of our BGGs define a thin mass Fundamental Plane strikingly similar to that followed by giant early-type galaxies in the local Universe reinforces confidence in the results obtained

The Current Account Reversails in the Peripheral Countries of the Eurozone

Analizamos aquí las reversiones de las cuentas corrientes en los países periféricos de la zona euro (ZES), Grecia, Italia, España, Portugal e Irlanda, durante los años de la crisis financiera. Después de determinar la tendencia e inicio de estos procesos, investigamos los costes implicados en cada país, utilizando un modelo keynesiano para economías abiertas. Estimamos el modelo con datos de panel del periodo 1999-2013. Nuestros resultados indican que cada país de la muestra sufrió costes significativos en términos de PIB, que van desde 32% en Grecia, hasta 6% en Irlanda. Estos hallazgos nos permiten obtener prescripciones de política económica, tanto para los gobiernos de los ZES como para las autoridades nacionales del núcleo de la zona euro.We analyze the current-account reversals in the peripheral countries of the euro zone (ZES), Greece, Italy, Spain, Portugal and Ireland, during the financial crisis episode. After determining the trend and start date of reversals, we investigate the involved economic costs in each country using a Keynesian model for open economies. We estimate the model with panel data of the period 1999-2013. Our results indicate that each country of the sample suffered significant costs in terms of GDP losses, going from 32% in Greece to 6% in Ireland. Results allow us to derive policy prescriptions for the governments of both peripheral and northern economies of the Eurozone

Evaluating the impact of existing legislation in Europe with regard to Female Genital Mutilation

The Spanish Report on the evaluation of existing legislation with regard to Female Genital Mutilation (FGM) is the result of a research project supported by the European Commision Daphne Programme. The project Evaluating the impact of existing legislation in Europe with regard to female genital mutilation, has been coordinated by the International Centre for Reproductive Health of Ghent University (Belgium) from january 2003 to march 2004. The project included as partners the Foundation for Women’s Health, Research and Development (FORWARD, United Kingdom); Lund University (Sweden); Commission pour l'Abolition des Mutilations Sexuelles, (CAMS, France), the Centre of Studies on Citizenship, Migration and Minorities of the University of Valencia (GECIM, Spain), and the above mentioned ICRH (Ghent University, Belgium) . The Spanish report is an interdisciplinary research done by the Centre of Studies on Citizenship, Migration and Minorities (University of València), directed by professor Javier De Lucas, and which counts with researchers and collaborators both, from the University of Valencia and other Universities such as University of Barcelona and University Rovira i Virgili of Tarragona; in the fields of Law (Penal Law, Constitutional Law, Theory and Philosophy of Law), Sociology and Antropology. The Group of researchers includes as well lawyers and public prosecutors. Practice of Female Genital Mutilation in Spain, like other european countries, address this rite that is introduced by immigrants from countries where the practice is prevalent (as we may see in chapter 3), as a violation of women’s rights and consider that such violation cannot be justified by respect of cultural traditions or initiation ceremonies. The increasing of immigration in Spain, has been a fact in last years, and it would be an important issue in future, increasing too the number of girls at risk in our country. In Spain, since october 2003, we have anew specific legislation, but before Female Genital Mutilation was liable too under the general offence of injuries in the Penal Code. In this Report, like in the other of the project, we have examined the possibilities and difficulties in the implementation of the spanish national legislation, in order to recommend a legislative and political strategy through Europe. page4image1440 The research methodology, common to all reports, was designed by the ICRH in its cooordination task, but was as well discussed by all the partners along the six steering commitee meetings we have had. The structure and content of report reflects the answers to following questions: 1. What is the legislation with regard to FGM in your country? Description of the legislation.; 2. What is the number of published court cases/suspected cases related to FGM in your country? What is the number of “hearsay” cases?; 3. Brief description of the practising community and the corresponding jurisdiction: number of Africans per country in the geographic area where the cases that you describe are located; 4. What is the procedure to be followed in case of a legal intervention to prevent or to penalise the performance of FGM?; 5. Is legislation applicable on FGM being implemented?; 6.What are the obstructing (favouring) factors for the implementation of legislation applicable to FGM? First of all we have compiled information about legislation applied with regard to FGM: not only general or specific criminal law, (in the case of Spain both because we have a change of law since october 2003), but also child protection procedures. In chapter 1, you may find the result: a Constitutional analysis, changes in Criminal Law, ans an introduction to Minor protection Laws. The second issue was the knowledge of court cases, police and judicial investigation in order to study how justice works. In this part, we contact key-informants, review archival records and study other reports: usually sociological, anthropological and health reports. In chapter 2 we have selected and summarized seven court cases in which we hace found enough relevant information to other parts of the report. At the same time, we need to identify the practicing communities to estimate the prevalence of women with FGM and the number of girls at risk of FGM. This was interesting not only to limit the research but to focus on a territory where there was a probability of cases in Court. We have choosen Catalonia: a community with court cases (in Barcelona and Girona) and prevalence of FGM; and Valencia, a territory without known cases and with no prevalence of FGM. This analysis is shown in chapter 3. In order to detect factors that hamper the implementation of existing legisaltion we need to know how procedures works at different levels: health services, social assistance, police, prosecution office and courts. Examining procedure laws, referral procedures, guidelines or ruled practices was not enough. We had to know what happen, who know a case, which institution examine it, which real mens they have.... To complete this, we have performe a study, interviewing key-informants with an standard interview: police, prosecutors, judges, doctors, nurses, social assistants and immigrants. Interviews were fulfilled in Valencia, Tarragona, Barcelona and Girona. Results are in Chapter 4 (procedure followed); Chapter 5 (implementation of appllicable legislation) and Chapter 6 (obstructing and favouring factors for the implementation of legislation). We had three main meetings to design the research and discuss texts and provissional results. Some of conclusions of provissional spanish report were discused in two seminars: “Ciudadania europea y conflictos culturales”, [european citizenship and cultural conflicts] (Valencia, 29, 30 and 31 october 2003); and “Violencia de género: instrumentos jurídicos en la lucha contra la discriminación de las mujeres”[Gender violence: legal instruments fighting agains women discrimination] (Valencia, 26, 27 and 28 november 2003) The study was financed by the European Commission, Daphne programme, and ran from January 2003 to March 2004 (EC-CONTRACT no 02/058/WYC). In additon, in the period we have done this study, the Centre of Studies on Citizenship, Migration and Minorities was financed with other projects related: “Indicadores y medidas para el desarrollo de políticas públicas de integración social de los inmigrantes y la garantía de sus derechos en la Comunidad Valenciana”, [indicators and measures to develop public policies for social integration of immigrants and the protection of their fundamental rights in the Land of Valencia], Project I+D “Generalitat Valenciana”; 2002-2003; "Los derechos fundamentales en las sociedades multiculturales" [fundamental rights in multicultural societies], project I+D, Subdirección General de Proyectos de Investigación, Dirección General de Investigación, Ministerio de Ciencia y Tecnología, november 2002-october 2005; “Los derechos de participación como elemento de integración de los inmigrantes” [participation rights as a element of the integration of immigrants], II Convocatoria de Ayudas a la Investigación en Economía, Demografía y Estudios de Población y Estudios Europeos de la Fundacion BBVA; 2004-2005. We wish to thank all who have collaborated in this study, specially we remark the collaboration and contributions of Elena Gascón Sorribas (Sociology of Law Laboratory; University of Zaragoza); María Heras García (Public Prosecutor); Dolores Gisbert Millet (Doctor, Health Service, Valencia); Ignacio de Lucas (Public Prosecutor); Laura Matilla (Lawyer, city council of Cullera); Joan Mayoral Simón (Justice Evaluating the impact of existing legislation with regard to Female Genital Mutilation..Spanish National Report. Daphne Programme Department, Regional Government of Catalonia); Xavier Montagud (Social Services, Regional Government of Valencia); and Dolores Sabater Collado (Court Secretary). With the results of the five National Report analysis and the information about legislation in all European Union member States, the coordinators, Els Leye and Jessika Deblonde, have elaborated A comparative analysis of the different legal approaches in the 15 EU Member States, and the respective judicial outcomes in Belgium, France, Spain, Sweden and the United Kingdom (ICRH, 2004)