A real-time disaggregated forecasting model for euro area GDP

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Premelting-Induced Smoothening of the Ice-Vapor Interface

We perform computer simulations of the quasiliquid layer of ice formed at the ice-vapor interface close to the ice Ih-liquid-vapor triple point of water. Our study shows that the two distinct surfaces bounding the film behave at small wavelengths as atomically rough and independent ice-water and water-vapor interfaces. For long wavelengths, however, the two surfaces couple, large scale parallel fluctuations are inhibited, and the ice-vapor interface becomes smooth. Our results could help explain the complex morphology of ice crystallites.Comment: postprint plus supplemental material with details on simulation and theor

Debt sustainability and fiscal space in a heterogeneous Monetary Union: normal times vs the zero lower bound

En este documento se estudian los efectos de la política fiscal y el espacio fiscal existente en una unión monetaria compuesta por países con distintos niveles de deuda pública. Desarrollamos un modelo de equilibrio general dinámico y estocástico (DSGE, por sus siglas en inglés) de una unión monetaria de dos países, calibrada a partir de las características de España y Alemania, en el que la sostenibilidad de la deuda pública y su prima de riesgo se determinan de forma endógena según el mecanismo propuesto por Bi (2012). En este modelo, las decisiones de política económica modifican las expectativas de los mercados sobre los superávits futuros afectando directamente a la prima de riesgo soberana y a las respuestas de las principales variables macroeconómicas. En tiempos normales, el coste de una consolidación fiscal basada en una reducción del gasto público en un país miembro de la unión con deuda elevada se ve reducido cuando esta mejora las perspectivas de sostenibilidad de su deuda pública. Una consolidación fiscal simultánea en los dos miembros de la unión reduce aún más los tipos de interés reales, lo que amplifica la caída de la prima de riesgo en el país más endeudado y, pese a reducir la actividad económica del conjunto de la unión en el corto plazo, puede suponer una mejora en el largo plazo. Por el contrario, cuando la política monetaria está restringida por haber alcanzado los tipos de interés nominales su cota inferior (ZLB, por sus siglas en inglés), el canal de la prima de riesgo ve muy reducida su efectividad. En esta situación, una consolidación fiscal genera expectativas deflacionarias que aumentan el tipo de interés real, lo que puede compensar total o parcialmente, según la calibración, los beneficios derivados de la menor prima de riesgo. Así, la estrategia que proporconaría un mayor aumento de la actividad en el conjunto de la unión en el ZLB sería una expansión fiscal en el país menos endeudado y una consolidación en el más endeudado. Finalmente, el canal de prima de riesgo solo afecta de forma indirecta a los miembros de la unión monetaria con un nivel de deuda medio o bajo, a través de los efectos sobre la economía de los miembros con una deuda elevada.In this paper we study fiscal policy effects and fiscal space for countries in a monetary union with different levels of public debt. We develop a dynamic stochastic general equilibrium (DSGE) model of a two-country monetary union, calibrated to match the characteristics of Spain and Germany, in which debt sustainability is endogenously determined a la Bi (2012) to shape the responses of the risk premium on public debt. Policy shocks change the market’s expectation about future primary surplus, producing a direct effect on the sovereign risk premium and macroeconomic responses of the economy. In normal times the costs of a government spending driven fiscal consolidation in the high-debt country are greatly diminished when this consolidation improves endogenously its debt sustainability prospects. Fiscal consolidations in both members of the monetary union decrease real interest rates and amplify the reduction in risk premium in the highly-indebted country, improving union-wide output in the long run, but at the cost of lower output in the lowdebt country in the short term. On the contrary, when monetary policy is constrained at the zero lower bound, the risk premium channel arising from the endogenous determination of debt sustainability becomes muted. In the ZLB, a fiscal consolidation generates deflation expectations which increase the real interest rate and may compensate partially or completely, depending on the calibration, the benefits from a lower risk premium. In this context, a fiscal expansion in the low-debt country and a consolidation in the highdebt country delivers the greater positive impact on union-wide output. Finally, the risk premium channel only affects countries with medium or low levels of public debt indirectly through the negative spillovers from other high-debt members of the monetary union

Uncovering the heterogeneous effects of ECB unconventional monetary policies across euro area countries

En este documento se evalúa el efecto de las medidas no convencionales de política monetaria adoptadas recientemente por el BCE por medio de un modelo VAR Global que explota la variación existente entre las variables de las economías que conforman el área del euro y tiene en cuenta de forma explícita las interdependencias entre países. La estimación del modelo muestra que las medidas de política monetaria no convencional tienen efectos positivos sobre la actividad, el crédito, la inflación y el precio de los activos, y producen una depreciación del tipo de cambio. La mayoría de los países miembros se benefician de estas medidas, pero existe un elevado grado de heterogeneidad. Una parte muy significativa de esta heterogeneidad se explica por las interacciones entre las economías del área del euro, recogidas explícitamente en nuestro modelo, que a su vez amplifican sustancialmente los efectos estimados. Si se compara con la política monetaria convencional (expansiva), las medidas de carácter no convencional parecen ser más efectivas en la coyuntura actual para reducir el coste de financiación de las empresas y potenciar el créditoWe assess the effects of the ECB’s recent unconventional monetary policy measures by estimating a global VAR that exploits panel variation among all euro area economies and explicitly takes into account cross-country interdependencies. Unconventional monetary policy measures have beneficial effects on activity, credit, inflation and equity prices, and lead to a depreciation of the exchange rate. Most euro area members benefit from these measures, but with a substantial degree of heterogeneity. Cross-country spillovers account for a sizable fraction of such dispersion, and substantially amplify effects. Countries with less fragile banking systems benefit the most from unconventional monetary policy measures. Compared to expansionary conventional monetary policies, unconventional measures are particularly effective in reducing firms’ financing costs and boosting credi

Community Law on rural development under the challenge of the priorities of European Union and International Law

[EN] This article analyzes rural development policy in the EU over the last decade, from the point of view of legal regulation. The current structure and system of rural development, as well as modifications and adjustments produced on it to meet new challenges and EU priorities for the future are studied. In particular, it deals with the analysis of the overall reform in place of the law on rural development support and the 2011 proposal for a new Regulation on the matter. The aim of the paper also deals with the various methods for the protection of the values represented by intangible cultural heritage and the interaction and the special relationship between the Convention and other international instruments, particularly its influence on the rules of the WTO and CAP as agricultural policy that is more integrated policy for all EU policies, whose importance is revealed, likewise, the percentage of the budget which accounts for the EU, which is 40%. The figure shows the importance of its goals, specifically, as the last document in Brussels, COM (2010) 672 final-on the challenges of the CAP for 2014-2020 - in ensuring food security, compliance environmental commitments and rural development, this is achieved by legal instruments such as direct payments and market management, in any case, the ultimate objective is the competitiveness of the agricultural sector. These same values are present in the Convention for the Safeguarding of the Intangible Cultural Heritage, how could it be otherwise, since agriculture is the source of local traditions and social identity, which is trying to promote and maintain the Convention, as a catalyst and control of the processes of globalization and social transformation, as the wealth is cultural diversity. In this way we analyze the various legal means afforded by the Convention and the list of intangible heritage, and therefore, their specific contributions to the protection of the environment or environmental policies, and their influence on rural development, with aim of highlighting its special compared to other international instruments and their complementarityAmat Llombart, P.; Muñiz-Espada, E. (2012). Community Law on rural development under the challenge of the priorities of European Union and International Law. Internacional Journal of Land Law and Agricultural Science. (7):70-95. http://hdl.handle.net/10251/110304S7095

Meeting our D€STINY : a disaggregated €uro area short term indicator model to forecast GDP (Y) growth

En este trabajo se propone un nuevo modelo de predicción en tiempo real del crecimiento de PIB de la zona euro, llamado D€STINY, con el que se pretende complementar la literatura de modelos de previsión de corto plazo, rellenando el hueco existente entre los modelos dinámicos factoriales de pequeña escala y los de dimensión grande. El modelo D€STINY adopta un enfoque de modelización desagregada, utilizando toda la información disponible para la zona del euro y los países que la forman (alrededor de 100 indicadores económicos), pero sin incurrir en los sesgos econométricos característicos de los modelos de gran dimensión, ya que todos los modelos son estimados con métodos de pequeña escala. Una aplicación empírica para el período 2004-2013 en pseudo tiempo real muestra que la precisión de la predicción de D€STINY es claramente mejor que la de los modelos estándares alternativos y que la de las previsiones públicas de otras instituciones. Esto se da, sobre todo, para el período desde el comienzo de la crisis, lo que sugiere que el enfoque adoptado en este trabajo seria más robusto en períodos caracterizados por una elevada volatilidad y posibles cambios estructuralesIn this paper we propose a new real-time forecasting model for euro area GDP growth, D€STINY, which attempts to bridge the existing gap in the literature between large- and small-scale dynamic factor models. By adopting a disaggregated modelling approach, D€STINY uses most of the information available for the euro area and the member countries (around 100 economic indicators), but without incurring in the nite sample problems of the large-scale methods, since all the estimated models are of a small scale. An empirical pseudo-real time application for the period 2004-2013 shows that D€STINY´s forecasting performance is clearly better than the standard alternative models and than the publicly available forecasts of other institutions. This is especially true for the period since the beginning of the crisis, which suggests that our approach may be more robust to periods of highly volatile data and to the possible presence of structural breaks in the sampl

Micro-based estimates of heterogeneous pricing rule : the United States vs. the Euro Area

This paper presents US and euro area estimates for a fully heterogeneous model, in which there is a continuum of fi rms setting prices with a constant probability of adjustment, which may differ from fi rm to fi rm. The estimated model accurately matches the empirical distribution function of individual price durations for the US and the euro area. Incorporating these micro based pricing rules into a DSGE model, we fi nd that nominal shocks have a greater real impact in the fully heterogeneous economy than in the standard Calvo model. We also fi nd that nominal and real shocks bring about a reallocation of resources among sectors. Monetary policy is found to have a greater real impact in the euro area than in the United State

Ludivine PETETIN y Mary DOBBS, Brexit and agriculture

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