Unit Roots, Level Shifts and Trend Breaks in Per Capita Output: A Robust Evaluation

Determining whether per capita output can be characterized by a stochastic trend is complicated by the fact that infrequent breaks in trend can bias standard unit root tests towards non-rejection of the unit root hypothesis. The bulk of the existing literature has focused on the application of unit root tests allowing for structural breaks in the trend function under the trend stationary alternative but not under the unit root null. These tests, however, provide little information regarding the existence and number of trend breaks. Moreover, these tests suffer from serious power and size distortions due to the asymmetric treatment of breaks under the null and alternative hypotheses. This paper estimates the number of breaks in trend employing procedures that are robust to the unit root/stationarity properties of the data. Our analysis of the per-capita GDP for OECD countries thereby permits a robust classification of countries according to the "growth shift", "level shift" and "linear trend" hypotheses. In contrast to the extant literature, unit root tests conditional on the presence or absence of breaks do not provide evidence against the unit root hypothesis.growth shift, level shift, structural change, trend breaks, unit root.

Rescaled density expansions and demixing in hard-sphere binary mixtures

The demixing transition of a binary fluid mixture of additive hard spheres is analyzed for different size asymmetries by starting from the exact low-density expansion of the pressure. Already within the second virial approximation the fluid separates into two phases of different composition with a lower consolute critical point. By successively incorporating the third, fourth, and fifth virial coefficients, the critical consolute point moves to higher values of the pressure and to lower values of the partial number fraction of the large spheres. When the exact low-density expansion of the pressure is rescaled to higher densities as in the Percus-Yevick theory, by adding more exact virial coefficients a different qualitative movement of the critical consolute point in the phase diagram is found. It is argued that the Percus-Yevick factor appearing in many empirical equations of state for the mixture has a deep influence on the location of the critical consolute point, so that the resulting phase diagram for a prescribed equation has to be taken with caution.Comment: 5 pages, 1 figure; to be published in The Journal of Chemical Physic

A simple model for the evolution of multi-stranded coronal loops

We develop and analyze a simple cellular automaton (CA) model that reproduces the main properties of the evolution of soft X-ray coronal loops. We are motivated by the observation that these loops evolve in three distinguishable phases that suggest the development, maintainance, and decay of a self-organized system. The model is based on the idea that loops are made of elemental strands that are heated by the relaxation of magnetic stress in the form of nanoflares. In this vision, usually called "the Parker conjecture" (Parker 1988), the origin of stress is the displacement of the strand footpoints due to photospheric convective motions. Modeling the response and evolution of the plasma we obtain synthetic light curves that have the same characteristic properties (intensity, fluctuations, and timescales) as the observed cases. We study the dependence of these properties on the model parameters and find scaling laws that can be used as observational predictions of the model. We discuss the implications of our results for the interpretation of recent loop observations in different wavelengths.Comment: 2010, accepted for publication in Ap

Auditor Type and Audit Quality Differences in Nonprofit Healthcare Organizations – U.S. Evidence

The purpose of this paper is to explore audit quality in nonprofit healthcare organizations by investigating differences in audit report outcomes. Specifically, we examine the relationship between auditor type and auditor-disclosed internal control exceptions in Circular A-133 audits of U.S. nonprofit healthcare organizations. Our findings indicate audits of nonprofit healthcare organizations conducted by the Big Four CPA firms carry a lower likelihood of disclosing internal control exceptions (i.e., reportable conditions and material weaknesses) than are audits conducted by smaller CPA firms. This challenges the general contention from prior studies that the Big Four firms are better audit quality providers and indicates that the alleged superiority of Big Four firms in terms of audit quality may not be generalizable to all industry sectors.Audit quality, Auditor type, Circular A-133, Nonprofit healthcare, Single Audit Act

Dynamical phase coexistence: A simple solution to the "savanna problem"

We introduce the concept of 'dynamical phase coexistence' to provide a simple solution for a long-standing problem in theoretical ecology, the so-called "savanna problem". The challenge is to understand why in savanna ecosystems trees and grasses coexist in a robust way with large spatio-temporal variability. We propose a simple model, a variant of the Contact Process (CP), which includes two key extra features: varying external (environmental/rainfall) conditions and tree age. The system fluctuates locally between a woodland and a grassland phase, corresponding to the active and absorbing phases of the underlying pure contact process. This leads to a highly variable stable phase characterized by patches of the woodland and grassland phases coexisting dynamically. We show that the mean time to tree extinction under this model increases as a power-law of system size and can be of the order of 10,000,000 years in even moderately sized savannas. Finally, we demonstrate that while local interactions among trees may influence tree spatial distribution and the order of the transition between woodland and grassland phases, they do not affect dynamical coexistence. We expect dynamical coexistence to be relevant in other contexts in physics, biology or the social sciences.Comment: 8 pages, 7 figures. Accepted for publication in Journal of Theoretical Biolog