Dissent in Monetary Policy Decisions

Voting records indicate that dissents in monetary policy committees are frequent and predictability regressions show that they help forecast future policy decisions. In order to study whether the latter relation is causal, we construct a model of committee decision making and dissent where members' decisions are not a function of past dissents. The model is estimated using voting data from the Bank of England and the Riksbank. Stochastic simulations show that the decision-making frictions in our model help account for the predictive power of current dissents. The eect of institutional characteristics and structural parameters on dissent rates is examined using simulations as well.Committees, voting models, political economy of central banking

Factor Analysis of a Large DSGE Model

We study the workings of the factor analysis of high-dimensional data using arti…cial series generated from a large, multi-sector dynamic stochastic general equilibrium (DSGE) model. The objective is to use the DSGE model as a laboratory that allow us to shed some light on the practical bene…ts and limitations of using factor analysis techniques on economic data. We explain in what sense the arti…cial data can be thought of having a factor structure, study the theoretical and fi…nite sample properties of the principal components estimates of the factor space, investigate the substantive reason(s) for the good performance of diffusion index forecasts, and assess the quality of the factor analysis of highly dissagregated data. In all our exercises, we explain the precise relationship between the factors and the basic macroeconomic shocks postulated by the model.Multisector economies, principal components, forecasting, pervasiveness, FAVAR

NONLINEAR MONETARY POLICY RULES: SOME NEW EVIDENCE FOR THE US

This paper dreives optimal monetary policy rules in setups where certainty equivalence does not hold because either central bank preferences are not quadratic, and/or the aggregate supply relation is nonlinear. Analytical results show that these features lead to sign and size aymmetries, and nonlinearities in the policy rule. Reduced-form estimates indicate that US monetary policy can be characterized by a nonlinear policy rule after 1983, but not before 1979. This finding is consistent with the view that the Fed`s inflation preferences during the Volcker-Greenspan regime differ considerably from the ones during the Burns-Miller regime.

Sectoral Price Rigidity and Aggregate Dynamics

In this paper, we study the macroeconomic implications of sectoral heterogeneity and, in particular, heterogeneity in price setting, through the lens of a highly disaggregated multi-sector model. The model incorporates several realistic features and is estimated using a mix of aggregate and sectoral U.S. data. The frequencies of price changes implied by our estimates are remarkably consistent with those reported in micro-based studies, especially for non-sale prices. The model is used to study (i) the contribution of sectoral characteristics to the observed cross sectional heterogeneity in sectoral output and inflation responses to a monetary policy shock, (ii) the implications of sectoral price rigidity for aggregate output and inflation dynamics and for cost pass-through, and (iii) the role of sectoral shocks in explaining secotral prices and quantities.Multi-sector models, price stickiness, simulated method of moments, sectoral shocks, monetary policy

Nonlinear monetary policy rules: some new evidence for the US

This paper dreives optimal monetary policy rules in setups where certainty equivalence does not hold because either central bank preferences are not quadratic, and/or the aggregate supply relation is nonlinear. Analytical results show that these features lead to sign and size aymmetries, and nonlinearities in the policy rule. Reduced-form estimates indicate that US monetary policy can be characterized by a nonlinear policy rule after 1983, but not before 1979. This finding is consistent with the view that the Fed`s inflation preferences during the Volcker-Greenspan regime differ considerably from the ones during the Burns-Miller regime

Durable Goods, Inter-Sectoral Linkages and Monetary Policy

Barsky, House and Kimball (2007) show that introducing durable goods into a sticky-price model leads to negative sectoral comovement of production following a monetary policy shock and, under certain conditions, to aggregate neutrality. These results appear to undermine sticky-price models. In this paper, we show that these results are not robust to two prominent and realistic features of the data, namely input-output interactions and limited mobility of productive inputs. When extended to allow for both features, the sticky-price model with durable goods delivers implications in line with VAR evidence on the effects of monetary policy shocks.Durability, input-output interactions, roundabout production, sectoral comovement, monetary policy

Inflation targeting under asymmetric preferences

El autor desarrolla y estima un modelo de teoria de juegos sobre objetivos de inflacion en el que las preferencias de los bancos centrales son asimetricas en torno a la tasa que se ha establecido como objetivo. En concreto, en la funcion de perdida de los bancos centrales, las desviaciones positivas del objetivo pueden ponderarse con mayor o menor severidad que las desviaciones negativas. Se muestra que algunos de los resultados anteriores derivados del supuesto de simetria no varian con la generalizacion de las preferencias. Las estimaciones de los parametros de preferencia de los bancos centrales para Canada, Suecia y el Reino Unido son estadisticamente diferentes de las implicitas en la funcion de perdida cuadratica utilizada habitualment. Los resultados econometricos no varian cuando se consideran distintos modelos de prediccion de la tasa de desempleo, pero si para la utilizacion de medidas de inflacion mas amplias que la establecida como objetivo. (fjrm) (ad

Development of organic fertilizers from food market waste and urban gardening by composting in Ecuador

Currently, the management of urban waste streams in developing countries is not optimized yet, and in many cases these wastes are disposed untreated in open dumps. This fact causes serious environmental and health problems due to the presence of contaminants and pathogens. Frequently, the use of specific low-cost strategies reduces the total amount of wastes. These strategies are mainly associated to the identification, separate collection and composting of specific organic waste streams, such as vegetable and fruit refuses from food markets and urban gardening activities. Concretely, in the Chimborazo Region (Ecuador), more than 80% of municipal solid waste is dumped into environment due to the lack of an efficient waste management strategy. Therefore, the aim of this study was to develop a demonstration project at field scale in this region to evaluate the feasibility of implanting the composting technology not only for the management of the organic waste fluxes from food market and gardening activities to be scaled-up in other developing regions, but also to obtain an end-product with a commercial value as organic fertilizer. Three co-composting mixtures were prepared using market wastes mixed with pruning of trees and ornamental palms as bulking agents. Two piles were created using different proportions of market waste and prunings of trees and ornamental palms: pile 1 (50:33:17) with a C/N ratio 25; pile 2: (60:30:10) with C/N ratio 24 and pile 3 (75:0:25) with C/N ratio 33), prepared with market waste and prunings of ornamental palm. Throughout the process, the temperature of the mixtures was monitored and organic matter evolution was determined using thermogravimetric and chemical techniques. Additionally, physico-chemical, chemical and agronomic parameters were determined to evaluate compost quality. The results obtained indicated that all the piles showed a suitable development of the composting process, with a significant organic matter decomposition, reached in a shorter period of time in pile 3. At the end of the process, all the composts showed absence of phytotoxicity and suitable agronomic properties for their use as organic fertilizers. This reflects the viability of the proposed alternative to be scaled-up in developing areas, not only to manage and recycle urban waste fluxes, but also to obtain organic fertilizers, including added value in economic terms related to nutrient contents.Peer ReviewedPostprint (published version

On the classification of Generalized Quasitopological Gravities

Generalized Quasitopological Gravities (GQTGs) are higher-order extensions of Einstein gravity in $D$ dimensions satisfying a number of interesting properties, such as possessing second-order linearized equations of motion on top of maximally symmetric backgrounds, admitting non-hairy generalizations of the Schwarzschild-Tangherlini black hole which are characterized by a single metric function or forming a perturbative spanning set of the space of effective theories of gravity. In this work, we classify all inequivalent GQTGs at all curvature orders $n$ and spacetime dimension $D \geq 4$. This is achieved after the explicit construction of a dictionary that allows the uplift of expressions evaluated on a single-function static and spherically symmetric ansatz into fully covariant ones. On the one hand, applying such prescription for $D \geq 5$, we find the explicit covariant form of the unique inequivalent Quasitopological Gravity that exists at each $n$ and, for the first time, the covariant expressions of the $n-2$ inequivalent proper GQTGs existing at every curvature order $n$. On the other hand, for $D=4$, we are able to provide the first rigorous proof of the fact that there is one and only one (proper) inequivalent GQTG at each curvature order $n$, deriving along the way a simple expression for such four-dimensional representative at every order $n$.Comment: 42 pages, 2 appendices, no figure