Unemployment, hysteresis and transition

We quantify the degree of persistence in unemployment rates of transition countries using a variety of methods benchmarked against the EU. In part of the paper, we work with the concept of linear "Hysteresis" as described by the presence of unit roots in unemployment. Since this is potentially a narrow definition, we also take into account the existence of structural breaks and non-linear dynamics in unemployment. Finally, we examine whether CEECs' unemployment presents features of multiple equilibria: if it remains locked into a new level whenever a structural change occurs. Our findings show that, in general, we can reject the unit root hypothesis after controlling for structural changes and business cycle effects, but we can observe the presence of a high and low unemployment equilibria. The speed of adjustment is faster for CEECs than the EU, although CEECs tend to move more frequently between equilibria. JEL Classification: E24, C22, C23Hysteresis, Markov switching, Transition, Unemployment, Unit Root

Identifying the elasticity of substitution with biased technical change

Despite being critical parameters in many economic fields, the received wisdom, in theoretical and empirical literatures, states that joint identification of the elasticity of capital-labor substitution and technical bias is infeasible. This paper challenges that pessimistic interpretation. Putting the new approach of "normalized" production functions at the heart of a Monte Carlo analysis we identify the conditions under which identification is feasible and robust. The key result is that the jointly modeling the production function and first-order conditions is superior to single-equation approaches in terms of robustly capturing production and technical parameters, especially when merged with "normalization". Our results will have fundamental implications for production-function estimation under non-neutral technical change, for understanding the empirical relevance of normalization and the variability underlying past empirical studies. JEL Classification: C22, E23, O30, 051Constant Elasticity of Substitution, Factor Income share, Factor-Augmenting Technical Change, Identification, Monte Carlo, Normalization

In dubio pro CES - Supply estimation with mis-specified technical change

Capital-labor substitution and total factor productivity (TFP) estimates are essential features of growth and income distribution models. In the context of a Monte Carlo exercise embodying balanced and near balanced growth, we demonstrate that the estimation of the substitution elasticity can be substantially biased if the form of technical progress is misspecified. For some parameter values, when factor shares are relatively constant, there could be an inherent bias towards Cobb-Douglas. The implied estimates of TFP growth also yield substantially different results depending on the specification of technical progress. A Constant Elasticity of Substitution production function is then estimated within a “normalized” system approach for the US economy over 1960:1–2004:4. Results show that the estimated substitution elasticity tends to be significantly lower using a factor augmenting specification (well below one). We are able to reject Hicks-, Harrod- and Solow-neutral specifications in favor of general factor augmentation with a non-negligible capital-augmenting component. Finally, we draw some important lessons for production and supply-side estimation. JEL Classification: C15, C32, E23, O33, O51Balanced Growth, Constant Elasticity of Substitution, Factor Income share, Factor-Augmenting Technical Change, Technical Progress Neutrality

The dynamics of hours worked and technology

We study the relationship between hours worked and technology during the postwar period in the US. We show that the responses of hours to technological improvements have increased over time, and that the patterns captured by the SVAR are consistent with those obtained from an RBC model with a less than unitary elasticity of substitution between capital and labor. Data supports the hypothesis that the observed changes in the response of hours to a technology shock are attributable to changes in the magnitude of the degree of capital-labor substitution ..En este artículo estudiamos la relación entre horas trabajadas y progreso técnico durante el período de postguerra en los Estados Unidos. Mostramos que la respuesta de las horas a mejoras tecnológicas ha aumentado a lo largo del tiempo y que los patrones capturados por un modelo SVAR son coherentes con los obtenidos por un modelo de ciclos reales con una elasticidad de sustitución entre capital y trabajo menor que 1. Los datos apoyan la hipótesis de que el cambio observado en la respuesta de las horas a mejoras tecnológicas es debido a cambios en la magnitud de la elasticidad de sustitución $\sigma$. Nuestro argumento es que la variación de $\sigma$ puede haber surgido por cambios en la composición estructural de los sectores de actividad económica o, de modo equivalente, la composición de los factores de producción en una función de producción con inputs heterogéneos, o bien por sesgos en la dirección del cambio técnic

The Dynamics of Hours Worked and Technology

The response of hours worked to technology shocks in the postwar US economy has increased over time. We offer a structural interpretation of this important time-varying macroeconomic moment. The time varying patterns captured by a structural VAR are consistent with those obtained from a parsimonious RBC model with a less than unitary elasticity of substitution between capital and labour (σ). The observed changes in the response of hours are attributable to increases in the magnitude of the degree of capital-labour substitution. Finally, we conjecture that the observed time-variation in σ is related to changes in the skill composition of the work force and biases in technological change

A genetic variant in the LDLR promoter is responsible for part of the LDL-cholesterol variability in primary hypercholesterolemia

BACKGROUND: GWAS have consistently revealed that LDLR locus variability influences LDL-cholesterol in general population. Severe LDLR mutations are responsible for familial hypercholesterolemia (FH). However, most primary hypercholesterolemias are polygenic diseases. Although Cis-regulatory regions might be the cause of LDL-cholesterol variability; an extensive analysis of the LDLR distal promoter has not yet been performed. We hypothesized that genetic variants in this region are responsible for the LDLR association with LDL-cholesterol found in GWAS. METHODS: Four-hundred seventy-seven unrelated subjects with polygenic hypercholesterolemia (PH) and without causative FH-mutations and 525 normolipemic subjects were selected. A 3103 pb from LDLR (-625 to +2468) was sequenced in 125 subjects with PH. All subjects were genotyped for 4 SNPs (rs17242346, rs17242739, rs17248720 and rs17249120) predicted to be potentially involved in transcription regulation by in silico analysis. EMSA and luciferase assays were carried out for the rs17248720 variant. Multivariable linear regression analysis using LDL-cholesterol levels as the dependent variable were done in order to find out the variables that were independently associated with LDL-cholesterol. RESULTS: The sequencing of the 125 PH subjects did not show variants with minor allele frequency ≥ 10%. The T-allele from g.3131C > T (rs17248720) had frequencies of 9% (PH) and 16.4% (normolipemic), p < 0.00001. Studies of this variant with EMSA and luciferase assays showed a higher affinity for transcription factors and an increase of 2.5 times in LDLR transcriptional activity (T-allele vs C-allele). At multivariate analysis, this polymorphism with the lipoprotein(a) and age explained ≈ 10% of LDL-cholesterol variability. CONCLUSION: Our results suggest that the T-allele at the g.3131 T > C SNP is associated with LDL-cholesterol levels, and explains part of the LDL-cholesterol variability. As a plausible cause, the T-allele produces an increase in LDLR transcriptional activity and lower LDL-cholesterol levels

External Constraints and Endogenous Growth: Why Didn't Some Countries Benefit From Capital Flows?

Empirical evidence on the growth benefits of capital inflows is mixed. The growth benefits accruing from capital inflows also appear to be larger for high savings countries. We explain this phenomenon using an OLG model of endogenous growth in open economies with borrowing constraints that can generate both positive and negative growth effects of capital inflows. The amount an economy can borrow is restricted by an endogenous enforcement constraint. In our setting, with physical capital and a pay-as-you-go pensions system, the steady state is unique. However, it can either be constrained or unconstrained. In a constrained economy, opening up to equity and FDI inflows can be bad for growth because it makes the domestic interest rate too low, which endogenously tightens borrowing constraints. Agents decrease savings and investment in productivity-enhancing activities resulting in lower growth. Results are reversed in an unconstrained economy. We also provide a quantitative analysis of these constraints and some policy implications

SARS-CoV-2 viral load in nasopharyngeal swabs is not an independent predictor of unfavorable outcome

The aim was to assess the ability of nasopharyngeal SARS-CoV-2 viral load at first patient’s hospital evaluation to predict unfavorable outcomes. We conducted a prospective cohort study including 321 adult patients with confirmed COVID-19 through RT-PCR in nasopharyngeal swabs. Quantitative Synthetic SARS-CoV-2 RNA cycle threshold values were used to calculate the viral load in log10 copies/mL. Disease severity at the end of follow up was categorized into mild, moderate, and severe. Primary endpoint was a composite of intensive care unit (ICU) admission and/or death (n = 85, 26.4%). Univariable and multivariable logistic regression analyses were performed. Nasopharyngeal SARS-CoV-2 viral load over the second quartile (≥ 7.35 log10 copies/mL, p = 0.003) and second tertile (≥ 8.27 log10 copies/mL, p = 0.01) were associated to unfavorable outcome in the unadjusted logistic regression analysis. However, in the final multivariable analysis, viral load was not independently associated with an unfavorable outcome. Five predictors were independently associated with increased odds of ICU admission and/or death: age ≥ 70 years, SpO2, neutrophils > 7.5 × 103/µL, lactate dehydrogenase ≥ 300 U/L, and C-reactive protein ≥ 100 mg/L. In summary, nasopharyngeal SARS-CoV-2 viral load on admission is generally high in patients with COVID-19, regardless of illness severity, but it cannot be used as an independent predictor of unfavorable clinical outcome

Global wealth disparities drive adherence to COVID-safe pathways in head and neck cancer surgery

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