Intertemporal Substitution and Sectoral Comovement in a Sticky Price Model

Strong procyclical fluctuations in the durable production are the most prominent feature of the empirical response to monetary shocks. This paper investigates the role of preferences in matching this feature of the data in a two-sector sticky price model with flexibly priced durables. The reaction of durables depends crucially on whether preferences are separable between labor and aggregate consumption. When preferences are separable, the model exhibits perverse behavior. Flexibly priced durables contract during periods of economic expansion. However, sticky price model with non-separable preferences can replicate the empirically plausible response of durable spending. The key to the model’s success hinges upon the fact that the non-separable preferences imply the complementarity between aggregate consumption and labor supply, absent in the separable preference. Finally, we present empirical evidence supporting the non-separable preferences.

Costly Labor Reallocation, Non-Separable Preferences, and Expectation Driven Business Cycles

A key feature of the business cycle data is that output, employment and investment move up and down together in dierent sectors of the economy. However, standard business cycle models fail to generate this business cycle sectoral co-movement. In this paper we propose a two-sector business cycle model that generates the sectoral cycle co-movement in response to both contemporaneous shocks and news shocks about fundamentals. The key elements to the model’s success are frictions in intersectoral labor mobility and non-separable preferences in consumption and leisure, along with adjustment costs to investment and variable capital utilization.

Did the price control achieve its goal?

As a result of the 1973 oil embargo and the subsequent increase of world oil prices, the oil price control program took place in order to reduce the impact of sharply higher external oil prices. In this regard, since the domestic price for oil was below that of the world market, the price control effort seemed to be regarded as successful. Did the oil price control achieve its goal? Maybe not. This study shows that the price control for the domestically produced crude oil was ineffective and enhanced the ability of external suppliers to manipulate prices.Oil Price Price Control

Income Inequality and Marriage

This study examines the extent to which changes in household formation exacerbated income inequality in the United States during the last two generations. Using a time-varying parameter model, the impact on how marriage decisions, changes in human capital, and fertility choices influence inequality are estimated. The estimation results show that marital sorting evolves over time and positively and increasingly affects the degree of income inequality and intergenerational human capital transmission induces path-dependent income distribution dynamics. This suggests that intrahousehold choices explain a substantial proportion of income distribution dynamics.

Altered expression of norepinephrine transporter and norepinephrine in human placenta cause pre-eclampsia through regulated trophoblast invasion

Objective: We investigated the norepinephrine transporter (NET) expression in normal and pre-eclamptic placentas and analyzed the invasion activity of trophoblastic cells based on norepinephrine (NE)-NET regulation. Methods: NET and NE expression levels were examined by western blot and enzyme-linked immunosorbent assay, respectively. Trophoblast invasion activity, depending on NE-NET regulation, was determined by NET-small interfering RNA (siRNA) and NET transfection into the human extravillous trophoblast cells with or without NE treatment and invasion rates were analyzed by zymography and an invasion assay. Results: NET mRNA was expressed at a low level in pre-eclamptic placentas compared with normal placentas and NE concentration in maternal plasma increased significantly in pre-eclamptic women compared to normal pregnant women (p<0.05). NET gene upregulation and NE treatment stimulated trophoblast cell invasion up to 2.5-fold (p<0.05) by stimulating matrix metalloproteinase-9 activity via the phosphoinositol-3-kinase/AKT signaling pathway, whereas NET-siRNA with NE treatment reduced invasion rates. Conclusion: NET expression is reduced by inadequate regulation of NE levels during placental development. This suggests that a complementary balance between NET and NE regulates trophoblast cell invasion activities during placental development