Welfare Implications of a Second Lender in the International Markets

The role of an extra lender in the international markets – such the IMF or another similar institution - has been widely covered in academic discussions and among policy makers. However, there is neither a clear answer nor a consensus about its welfare consequences. On the one hand, it is argued that the moral hazard consequences of an extra lender could be strong enough to offset any positive effect of an additional source of funding. On the other hand, it is argued that moral hazard consequences could be negligible and, therefore, the second lender’s presence could be welfare improving. The aim of this paper is twofold. First, it provides a numerical perspective about the welfare effect of an active second lender. Second, it sheds light on the debt dynamics in the two-lender case. The main result is that the second lender is not beneficial from a welfare standpoint for a wide range of parameters. Without coordination, the estimates imply welfare losses that range from 1.5% to 6% of GDP, depending on the severity of the second lender’s penalties. On the other hand, if a coordination mechanism is imposed, such as the second lender acting as a lender of last resort, then the model will mimic a one-lender model where the first lender is crowded out from the market. l II) could be helpful on this task.

Microeconomic Evidence of Nominal Wage Rigidity in Chile

This paper presents micro evidence on the degree of downward nominal wage rigidity in Chile and also explores its consequences in terms of employment. The data used corresponds to a new panel based on 440 thousand wage histories for the period 2001.12-2007.12. The results indicate a low degree of wage flexibility, the estimated length of wage adjustment for the whole economy being around nine quarters. In terms of the determinants of wage rigidity, the degree of flexibility depends negatively on the size of the firm, the percentage of female workers, the age of workers and white-collar participation at firm level. The econometric estimations indicate that the direct consequence of wage rigidity is a higher fluctuation of employment through the business cycle.

Chinese Penetration and Importer Country Wages: Microevidence From Chile

The increasing importance of China in the world trade raises important questions on its impact on importing countries. This paper studies how import competition from China has affected wages in the Chilean Manufacturing Industry. Using plant-level data for the period 1996-2005, we find that increasing imports from China have tended to depress real wages in manufacturing plants. This negative effect on manufacturing workers is heterogeneous. We find that firms in labor-intensive industries and smaller firms have been quantitatively more affected by Chinese competition. These results hold to correction for sample selection and alternative measures of import competition from low-wages countries.

The Long And The Short Of Emerging Market Debt

Emerging economies have tried to promote long-term debt since it reduces maturity mismatches and the probability of crises. This paper uses unique evidence from the leading case of Chile to study to what extent there is domestic demand for long-term instruments. We analyze monthly asset-level portfolios of Chilean institutional investors (mutual funds, pension funds, and insurance companies) and compare their maturity structure to that of US bond mutual funds. Despite being thought to invest long term, Chilean asset-management institutions (mutual and pension funds) hold large amounts of short-term assets relative to US mutual funds and Chilean insurance companies. Shorttermism is not driven by lack of instrument availability or tactical behavior. Instead, it seems to be explained by the desire to minimize inflation risk and, more importantly, by manager incentives that tilt demand toward short-term instruments. Extending the maturity of emerging market debt may require reducing risk and reshaping investor incentives.

Interbank Rate and the Liquidity of the Market.

In this paper we study the dynamics of the interbank rate in Chile, with special attention to the role of liquidity provided by private depositors and by the central bank’s open market operations on a daily basis. The main aim of this paper is the use of disaggregated and high frequency data on such variables. The most relevant findings are related to the statistical and economic significance of speed of convergence, calendar effects and repos operations. The Central Bank plays a more important role injecting than draining liquidity through discretionary operations. However, there are not asymmetries in terms of the effectiveness of the discretionary injections and drainages operations depending on the liquidity market status. In terms of effect by class of bank, large- and medium-size banks are less receptive to monetary operations; by contrast small-size banks are the most responsive, which is consistent with its traditional position as a liquidity demander. Finally, private deposits do not play an important role on the dynamics of the interbank rate during the sample period.

The long and the short of emerging market debt

Emerging economies have tried to promote long-term debt because it reduces maturity mismatches and the probability of crises. This paper uses unique evidence from the leading case of Chile to study to what extent there is domestic demand for long-term instruments. The authors analyze monthly asset-level portfolios of Chilean institutional investors (mutual funds, pension funds, and insurance companies) and compare their maturity structure to that of US bond mutual funds. Despite being thought to invest long term, Chilean asset-management institutions (mutual and pension funds) hold large amounts of short-term assets relative to US mutual funds and Chilean insurance companies. Short-termism is not driven by lack of instrument availability or tactical behavior. Instead, it seems to be explained by the desire to minimize inflation risk and, more importantly, by manager incentives that tilt demand toward short-term instruments. Extending the maturity of emerging market debt may require reducing risk and reshaping investor incentives.Debt Markets,Emerging Markets,,Investment and Investment Climate,Deposit Insurance

Extinction and recovery dynamics of Triassic-Jurassic macro-invertebrate communities

This work is focused on characterising and evaluating the intensity and selectivity of the marine fauna during the Tr/J mass extinction and recovery of the ecosystem in different localities throughout Pangaea. To address this, four localities were studied: St. Audrie’s Bay, Larne and Pinhay Bay in the UK, and Portezuelo Providencia in Chile. From each locality, samples were taken at approximately 1m intervals throughout the Tr/J sections. Species abundance per sample was estimated and each species was classified according to autoecological information derived from the literature. In order to assess changes in the structure and composition of the assemblages, NMDS and beta diversity index were performed, dominance and richness were estimated and the data were tested against five rank abundance (RAD) models. Ecospace modelling was used to estimate the loss in ecological diversity. Measures of the body size of bivalves and ichno-parameters were recorded on each section. Through the UK sections, the richness, dominance and the composition rate shifted abruptly during the extinction event. A geometric model shows the best fit during extinction events and, in contrast, a log-normal model best fits the pre-extinction and recovery event. The body size of the bivalves did not decrease during the Tr/J, while the coverage, richness and body size of ichnofossils increased during the recovery. The Chile Tr/J section records low richness, but the ecological complexity and richness decreases through the interval and composition records high turnover, while the dominance increases. The results indicate that the Tr/J disruption changed species composition in a relatively short time period, which decreased the ecological functionality of the invertebrate marine assemblage. In spatial terms, the UK fauna show a clear response to the extinction effect, but the diversity response of the Chilean assemblage is not clear at all, which may be related to taphonomical bias. Alternatively, this work analysed stage-by-stage occupation of ecospace of 3181 genera recorded from Sepkoski`s compendium for the marine fauna from the Late Permian to Early Jurassic. The ecospace can be represented as a combination of the three axes of tiering, motility and feeding, each divided into six subcategories. From the Cambrian to Recent, ecospace utilisation has tripled, however the trend through the Phanerozoic remains unclear. This result indicates that from the Guadalupian to Sinemurian the number of modes of life did not increase significantly, but the ecospace packing does. There was a significant positive correlation between abundance of predators and both infaunalisation and motility. However, the ecospace utilisation decreased 35% and 16% at the end of Permian and Triassic, respectively. During the extinction events, non-motile animals, organisms with little physiological control of biocalcification and the epifaunal forms, were heavily affected. This indicates that the mass extinction had a particular ecological effect on the biota and is an important episode of ecological changes due to ecological selectivity. Parallel, the appearance of adaptations to new trophic niches during the Triassic, like durophagy, presumably increased predation pressure and drove the increase in benthic infaunalisation. This series of adaptation could be potentially associated with the Marine Mesozoic Revolution.The Programme AlBan, the European Union Programme of High Level Scholarships for the Latin America, scholarship No (E07D402767CL) and CONICYT, Beca de Doctorado en el Extranjero por Gestión Propia 2007, given by the Chilean Government

Glutamate-induced reversal of dopamine transport is mediated by the PKC signalling pathway

Dopaminerge Neuronen setzen ihre Transmitter nicht nur von den Axonterminals im Striatum frei, sondern auch von ihren langen apikalen Dendriten in der substantia nigra pars reticulata (SNr). Ob die dendritische Freisetzung von Dopamin durch Exozytose oder durch die Umkehrung des Dopamintransporters (DAT) geschieht, ist nach wie vor umstritten. Vorangehende Studien zeigten, dass die Glutamat-induzierte Freisetzung von Dopamin durch den DAT keine ionotropen Glutamatrezeptoren erfordert. In dieser Studie erforschten wir daher die Rolle von metabotropen Glutamatrezeptoren (mGluRs) für der Freisetzung von dendritischem Dopamin durch den DAT. Wir benutzten Amperometrie, um die Freisetzung von Dopamin in Gehirnschnitten aus dem Mittelhirn von Ratten zu messen. Glutamat induzierte die Freisetzung von Dopamin durch den DAT und wurde reversibel durch Chelerythrin, einen Inhibitor der Proteinkinase C (PKC), blockiert. Ein selektiver Gruppe I mGluR-Agonist induzierte die Freisetzung von Dopamin und wurde reversibel durch den DAT-Antagonisten GBR12935 blockiert. Ferner war der PKC-Aktivator PMA ebenfalls in der Lage, eine DAT-vermittelte Freisetzung von Dopamin hervorzurufen. Die PKC-induzierte Freisetzung von Dopamin war bisher mit dem Effekt von Amphetamin auf den DAT in Verbindung gebracht worden, jedoch nicht mit der physiologischen Aktivierung von mGluRs. Um die Elemente der Signalkaskade in der Zelle weiter zu untersuchen, erzeugten wir stabil transfizierte SH-SY5Y Zellen, die humanen DAT (SH-DAT) exprimieren. Elemente der mGluRI Signalkaskade waren in der Lage, die Freisetzung von Dopamin zu induzieren und wurden durch Chelerythrin blockiert. Um die Rolle N-terminaler Phosphorylierung des DAT für die hier untersuchte Freisetzung von Dopamin zu untersuchen, generierten wir eine neue stabil transfizierte Zelllinie, die einen um die ersten 19 Aminosäuren gekürzten Dopamintransporter (SH-D19) exprimierte. Fünf N-terminale Serine, die mögliche PKC-Phosphorylierungsstellen sind, wurden dadurch entfernt. Jedoch war die PKC-induzierte Freilassung von Dopamin in diesen SH-D19 Zellen weiterhin möglich. Der PKC-induzierte Dopaminausfluss in den SH-DAT Zellen wurde dagegen durch den nicht-selektive Kationenkanalblocker Lanthanum (La+3) blockiert. Unsere Forschungsergebnisse deuten darauf hin, dass PKC-induzierte Dopaminfreisetzung nicht durch DAT-Phosphorylierung auftritt. Stattdessen wird möglcherweise ein Natriumeinstrom nach der PKC-Aktivierung benötigt. Dieser könnte durch PKC-abhänige Kationskanäle, wie die transient receptor potential (TRP) Kanäle, vermittelt werden. In dieser Arbeit zeigen wir, dass die Aktivierung einer Signalkaskade zu einer Umkehrung des DAT führt. Da metabotrope Rezeptoren im Nervensystem weithin exprimiert sind, könnte dieses Phänomen auch an anderen Stellen und mit anderen Neurotransmittern auftreten. Darüberhinaus weist diese Studie darauf hin, dass die Freisetzung von Neurotransmittern nicht auf einen presynaptischen Ort limitiert ist

Compensación Inflacionaria en Chile

This paper provides a simple analytical framework to decompose breakeven inflation. Estimates suggest that one and two years ahead, breakeven inflations are strongly linked to inflation expectations, and that their recent values are not necessarily inconsistent with complying with the inflation target. In the case of breakeven inflation one year ahead (1-1), figures like those of March-2008 require premiums (e.g., liquidity premiums) in the order of 100 bp to be consistent with an inflation rate of 3% two years ahead. While breakeven inflation in longer horizons, (5-5) is high, the gap between the 5-5 breakeven inflation and the target is small compared to that of other economies.