Exchange rates and fundamentals: a generalization

Exchange rates have raised the ire of economists for more than twenty years. The problem is that few, if any, exchange rate models are known to systematically beat a naive random walk in out-of-sample forecasts. Engel and West (2005) show that these failures can be explained by the standard present value model (PVM) because it predicts random walk exchange rate dynamics if the discount factor approaches one and fundamentals have a unit root. This paper generalizes the Engel and West hypothesis to the larger class of open economy dynamic stochastic general equilibrium (DSGE) models. The Engel and West hypothesis is shown to hold for a canonical open economy DSGE model. We show that all the predictions of the standard PVM carry over to the DSGE PVM. The DSGE PVM also yields unobserved components (UC) models that we estimate using Bayesian methods and a quarterly Canadian-U.S. sample. Bayesian model evaluation reveals that the data support a UC model that calibrates the discount factor to one, implying the Canadian dollar–U.S. dollar exchange rate is a random walk dominated by permanent cross-country monetary and productivity shocks.Foreign exchange rates

The present-value model of the current account has been rejected: Round up the usual suspects

Tests of the present-value model of the current account are frequently rejected by the data. Standard explanations rely on the "usual suspects" of nonseparable preferences, shocks to fiscal policy and the world real interest rate, and imperfect international capital mobility. The authors confirm these rejections on postwar Canadian data, then investigate their source by calibrating and simulating alternative versions of a small open economy, real business cycle model. Monte Carlo experiments reveal that, although each of the suspects matters in some way, a "canonical" RBC model moves closest to the data when it features exogenous world real interest rate shocks.Balance of payments ; International finance ; Econometric models

Internal Gravity Waves Modulate the Apparent Misalignment of Exoplanets around Hot Stars

We propose that the observed misalignment between extra-solar planets and their hot host stars can be explained by angular momentum transport within the host star. Observations have shown that this misalignment is preferentially around hot stars, which have convective cores and extended radiative envelopes. This situation is amenable to substantial angular momentum transport by internal gravity waves (IGW) generated at the convective-radiative interface. Here we present numerical simulations of this process and show that IGW can modulate the surface rotation of the star. With these two- dimensional simulations we show that IGW could explain the retrograde orbits observed in systems such as HAT-P-6 and HAT-P-7, however, extension to high obliquity objects will await future three- dimensional simulations. We note that these results also imply that individual massive stars should show temporal variations in their v sini measurements.Comment: 6 pages, 2 figures, Accepted for publication in ApJ

A finite element for thermal stress analysis of shells of revolution

A new finite element is described for performing detailed thermal stress analysis of thin orthotropic shells of revolution. The element provides for temperature loadings which may vary over the surface of the shell as well as through the thickness. In a number of sample calculations, results from the present method are compared with analytical solutions as well as with independent numerical analyses. Such calculations are carried out for two cylinders, a conical frustum, a truncated hemisphere, and an annular plate. Generally, the agreement between the present solution and the other solutions is excellent

The provision of distance education within the HE sector - some areas for concern

This paper presents a summary of the findings of a recent survey of the way in which UK higher education institutions (HEIs) are offering distance education (DE) courses, the types of courses being offered, and their modes of delivery. From analysis of the findings of this survey, it is apparent that the emphasis of HEIs is very much on the exploitation of available teaching technology in the delivery of DE courses. However, teaching at a distance is quite different from face-toface teaching, and the evidence suggests that many HEIs fail to implement any meaningful academic staff training for the new role of DE tutor. The authors consider the difficulties this presents to academic staff who are required to move from face-to-face teaching to online facilitating. The paper concludes with an examination of the current provision of staff development and training within UK HEIs and suggests the type of academic staff training required if DE courses are to become truly core activities

What Makes Educational Campaings Succeed?

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Gauge fixing and equivariant cohomology

The supersymmetric model developed by Witten to study the equivariant cohomology of a manifold with an isometric circle action is derived from the BRST quantization of a simple classical model. The gauge-fixing process is carefully analysed, and demonstrates that different choices of gauge-fixing fermion can lead to different quantum theories.Comment: 18 pages LaTe

Quasi-Chemical and Structural Analysis of Polarizable Anion Hydration

Quasi-chemical theory is utilized to analyze the roles of solute polarization and size in determining the structure and thermodynamics of bulk anion hydration for the Hofmeister series Cl$^-$, Br$^-$, and I$^-$. Excellent agreement with experiment is obtained for whole salt hydration free energies using the polarizable AMOEBA force field. The quasi-chemical approach exactly partitions the solvation free energy into inner-shell, outer-shell packing, and outer-shell long-ranged contributions by means of a hard-sphere condition. Small conditioning radii, even well inside the first maximum of the ion-water(oxygen) radial distribution function, result in Gaussian behavior for the long-ranged contribution that dominates the ion hydration free energy. The spatial partitioning allows for a mean-field treatment of the long-ranged contribution, leading to a natural division into first-order electrostatic, induction, and van der Waals terms. The induction piece exhibits the strongest ion polarizability dependence, while the larger-magnitude first-order electrostatic piece yields an opposing but weaker polarizability dependence. In addition, a structural analysis is performed to examine the solvation anisotropy around the anions. As opposed to the hydration free energies, the solvation anisotropy depends more on ion polarizability than on ion size: increased polarizability leads to increased anisotropy. The water dipole moments near the ion are similar in magnitude to bulk water, while the ion dipole moments are found to be significantly larger than those observed in quantum mechanical studies. Possible impacts of the observed over-polarization of the ions on simulated anion surface segregation are discussed.Comment: slight revision, in press at J. Chem. Phy

A dispersive wave pattern on Jupiter's fastest retrograde jet at 20∘20^\circS

A compact wave pattern has been identified on Jupiter's fastest retrograding jet at 20S (the SEBs) on the southern edge of the South Equatorial Belt. The wave has been identified in both reflected sunlight from amateur observations between 2010 and 2015, thermal infrared imaging from the Very Large Telescope and near infrared imaging from the Infrared Telescope Facility. The wave pattern is present when the SEB is relatively quiescent and lacking large-scale disturbances, and is particularly notable when the belt has undergone a fade (whitening). It is generally not present when the SEB exhibits its usual large-scale convective activity ('rifts'). Tracking of the wave pattern and associated white ovals on its southern edge over several epochs have permitted a measure of the dispersion relationship, showing a strong correlation between the phase speed (-43.2 to -21.2 m/s) and the longitudinal wavelength, which varied from 4.4-10.0 deg. longitude over the course of the observations. Infrared imaging sensing low pressures in the upper troposphere suggest that the wave is confined to near the cloud tops. The wave is moving westward at a phase speed slower (i.e., less negative) than the peak retrograde wind speed (-62 m/s), and is therefore moving east with respect to the SEBs jet peak. Unlike the retrograde NEBn jet near 17N, which is a location of strong vertical wind shear that sometimes hosts Rossby wave activity, the SEBs jet remains retrograde throughout the upper troposphere, suggesting the SEBs pattern cannot be interpreted as a classical Rossby wave. Cassini-derived windspeeds and temperatures reveal that the vorticity gradient is dominated by the baroclinic term and becomes negative (changes sign) in a region near the cloud-top level (400-700 mbar) associated with the SEBs, suggesting a baroclinic origin for this meandering wave pattern. [Abr]Comment: 19 pages, 11 figures, article accepted for publication in Icaru