Clusters and Loops of the German Phillips Curve

A preliminary regression analysis of different versions of the Phillips Curve on the basis of yearly data of the German economy from 1952 to 2004 leads to the conclusion that the original finding might still be of empirical relevance. A simple plot of seasonal adjusted quarterly data between the change of nominal wage rates and the unemployment rate shows a picture similar to that by which Phillips was inspired to his famous discovery: A long-term tendency of a negative, non-linear relationship coupled with minor deviations from this tendency forming sometimes so called loops. At fist sight, the Phillips Curve of Germany comprises clusters of data points and movements between these clusters. The clusters can be analysed and – together with the rest of data – dissolved into 12 (left or right turning) loops and 9 movements between these loops during the period from 1971Q1 to 2009Q4. In spite of the striking differences of these phenomena, a model with one regression equation is sufficient to explain the loops, the movements between the loops and the long-term tendency of the German Phillips Curve. This empirical finding contradicts several aspects with the ruling dogma of a Phillips Curve that broke down in the ‘70s and with the allegedly better fit of its replacements by augmented and modified Phillips Curves.Wages, inflation, unemployment, Phillips curve

Is the Phillips Curve of Germany Spurious?

A simple plot of seasonal adjusted quarterly data between the change of nominal wage rates and the unemployment rate for the German economy shows a picture similar to that by which Phillips was inspired to his famous discovery, that there is a long-term tendency of a negative, non-linear relationship coupled with minor deviations from this tendency, which form so-called loops. At first sight, the Phillips Curve of Germany comprises clusters of data points and movements between these clusters. In spite of the striking differences of these phenomena, a model with one regression equation is sufficient to explain the loops, the movements between the loops and the long-term tendency of the German Phillips Curve. It might well be that the German Phillips Curve and the corresponding regressions are spurious, but an allegedly missing co-integration of wage rate changes and unemployment rate is not the argument that could be drawn on to sustain this scepticism. On the contrary, both variables are co-integrated. To get a more detailed insight into the relationship, the two variables are split into a trend and a cyclical component by the help of the HP-filter. The results of regression analyses applied to the separated components support Phillips’ hypothesis of a negative relationship between wage rate changes and the unemployment rate.Wages, Unemployment, Phillips Curve

Including widespread geometry formats in semantic graphs using RDF literals

The exchange of building data involves both geometric and non-geometric data. A promising Linked Data approach is to embed data from existing geometry formats inside Resource Description Framework (RDF) literals. Based on a study of relevant specifications and related work, this toolset-independent approach was found suitable for the exchange of geometric construction data. To implement the approach in practice, the File Ontology for Geometry formats (FOG) and accompanying modelling method is developed. In a proof-of-concept web application that uses FOG, is demonstrated how geometry descriptions of different existing formats are automatically recognised and parsed

Income Redistribution, Consumer Credit, and Keeping Up with the Riches

In this study, we set up a dynamic stochastic general equilibrium (DSGE) model with upward looking consumption comparison and show that consumption externalities are an important driver of consumer credit dynamics. Our model economy is populated by two different household types. Investors, who hold the economy\u27s capital stock, own the firms and supply credit, and workers, who supply labor and demand credit to finance consumption. Furthermore, workers condition their consumption choice on the investors\u27 level of consumption. We estimate the model and find a significant keeping up mechanism by matching business cycle statistics. In reproducing credit moments, our proposed model significantly outperforms a model version in which we abstract from consumption externalities

Mean Flow and Turbulence Characteristics in an Urban Roughness Sublayer

In this study, a detailed model of an urban landscape has been re-constructed inthe wind tunnel and the flow structure inside and above the urban canopy has beeninvestigated. Vertical profiles of all three velocity components have been measuredwith a Laser-Doppler velocimeter, and an extensive analysis of the measured meanflow and turbulence profiles carried out. With respect to the flow structure inside thecanopy, two types of velocity profiles can be distinguished. Within street canyons,the mean wind velocities are almost zero or negative below roof level, while closeto intersections or open squares, significantly higher mean velocities are observed.In the latter case, the turbulent velocities inside the canopy also tend to be higherthan at street-canyon locations. For both types, turbulence kinetic energy and shearstress profiles show pronounced maxima in the flow region immediately above rooflevel. Based on the experimental data, a shear-stress parameterization is proposed, inwhich the velocity scale, us, and length scale, zs, are based on the level and magnitude of the shear stress peak value. In order to account for a flow region inside the canopy with negligible momentum transport, a shear stress displacement height, ds, is introduced. The proposed scaling and parameterization perform well for the measured profiles and shear-stress data published in the literature. The length scales derived from the shear-stress parameterization also allowdetermination of appropriate scales for the mean wind profile. The roughnesslength, z0, and displacement height, d0, can both be described as fractions of the distance, zs - ds, between the level of the shear-stress peak and the shear-stress displacement height. This result can be interpreted in such a way that the flow only feels the zone of depth zs - ds as the roughness layer. With respect to the lower part of the canopy (z < ds) the flow behaves as a skimming flow. Correlations between the length scales zs and ds and morphometric parameters are discussed. The mean wind profiles above the urban structure follow a logarithmic windlaw. A combination of morphometric estimation methods for d0 and z0 with wind velocity measurements at a reference height, which allow calculation of the shear-stress velocity, u*, appears to be the most reliable and easiest procedure to determine mean wind profile parameters. Inside the roughnesssublayer, a local scaling approach results in good agreement between measuredand predicted mean wind profile

The Contribution of Alternative NAIRU-curves to the Explanation of Inflation

The Non-Accelerating Inflation Rate of Unemployment (NAIRU) is a major concept in (monetary) economics in predicting changes in the inflation rate. As the inflation neutral unemployment rate is an unobserved and, in the long run, a changing variable, several questions arise about its adequate estimation. The following study determines four different possible NAIRU-curves for the German economy during the period of 1973Q1-2010Q2 by the use of a State-Space-Model. With the help of the Ordinary-Least-Square (OLS) and the Maximum-Likelihood (ML) method, these curves are implemented and utilized in regression models which are trimmed to satisfactorily explain inflation changes. It turns out that besides the NAIRU, several other variables like the changes in the unemployment rate or the labor productivity are necessary to forecast changes in the inflation rate accurately. Among the four regression models, the one applying the NAIRU with the lowest variance and with a high theoretic plausibility has the worst record, while the equation with a NAIRU fluctuating more than the unemployment rate explains the inflation rate best.Non-Accelerating Inflation Rate of Unemployment; NAIRU

Estimating Fiscal Multipliers by Combining Statistical Identification with Potentially Endogenous Proxies

Different proxy variables used in fiscal policy SVARs lead to contradicting conclusions regarding the size of fiscal multipliers. In this paper, we show that the conflicting results are due to violations of the exogeneity assumptions, i.e. the commonly used proxies are endogenously related to the structural shocks. We propose a novel approach to include proxy variables into a Bayesian non-Gaussian SVAR, tailored to accommodate potentially endogenous proxy variables. Using our model, we show that increasing government spending is a more effective tool to stimulate the economy than reducing taxes. We construct new exogenous proxies that can be used in the traditional proxy VAR approach resulting in similar estimates compared to our proposed hybrid SVAR model.Comment: 10 figure

How government spending shapes the Eurozone economy

The question of how fiscal policy affects the Eurozone economy has received substantial attention over the last decade. Drawing on a new study, Ricardo Duque Gabriel, Mathias Klein and Ana Sofia Pessoa use a novel regional dataset to estimate the effect of fiscal stimulus on factors such as private investment, productivity, consumption and real wages

The Phosphorylation of PDX-1 by Protein Kinase CK2 Is Crucial for Its Stability

The homeodomain protein PDX-1 is a critical regulator of pancreatic development and insulin production in pancreatic β-cells. We have recently shown that PDX-1 is a substrate of protein kinase CK2; a multifunctional protein kinase which is implicated in the regulation of various cellular aspects, such as differentiation, proliferation, and survival. The CK2 phosphorylation site of PDX-1 is located within the binding region of the E3 ubiquitin ligase adaptor protein PCIF1. To study the interaction between PDX-1 and PCIF1 we used immunofluorescence analysis, co-immunoprecipitation, GST-pull-down studies, and proximity ligation assay (PLA). For the analysis of the stability of PDX-1 we performed a cycloheximide chase. We used PDX-1 in its wild-type form as well as phosphomutants of the CK2 phosphorylation site. In pancreatic β-cells PDX-1 binds to PCIF1. The phosphorylation of PDX-1 by CK2 increases the ratio of PCIF1 bound to PDX-1. The stability of PDX-1 is extended in the absence of CK2 phosphorylation. Our results identified protein kinase CK2 as new important modulator of the stability of PDX-1