The Effect of Fiscal Rules on Public Investment if Budget Deficits Are Politically Motivated

Uncertainty about the future preferences of the government may induce policy makers to run excessive budget deficits. As a solution to this problem, economists have proposed to impose a binding debt rule. In this paper we argue that a binding debt rule does not eliminate the distortions due to strategic behaviour of politicians. Rather, strategic manipulation shifts from public debt to public investment. As an alternative, we examine the effects of a capital borrowing rule which permits the government to run a budget deficit equal to the amount of public investment. We show that this rule effectively eliminates strategic behaviour.fiscal rules and budget deficits and public investment

Producing and Manipulating Information: Private Information Providers versus Public Information Providers

To reduce the chances of policy failures, policy makers need information about the effects of policies. Sometimes, policy makers can rely on agents who already possess the information. Often, the information does not exist yet. This raises two questions. First, how much resources should be devoted to the production of information? Second, should information be produced by a profit- maximizing firm (a private consultant) or by someone who has an interest in policy outcomes (a political adviser)? This paper shows that policy makers may prefer hiring a political adviser for two reasons. First, in contrast to a private consultant, a political adviser need not be fully compensated for exerting effort. Second, a political adviser with moderate preferences produces information of a higher expected quality than a private consultant is induced to do by the optimal monetary incentive scheme. The cost of hiring a political adviser is that she may distort policy decisions by manipulating information. As long as a political adviser is not too biassed, the policy maker prefers consulting a political adviser to consulting a private consultant, even if a political adviser and a private consultant are equally costly. Competition among political advisers is shown to reduce the willingness of political advisers to produce information

Sequential Advocacy

The collection of information necessary for decision-making is often delegated to agents (e.g. bureaucrats, advisors, lawyers). If both the pros and cons of a decision have to be examined, it is better to use competing agents instead of a single agent. The reason is that two conflicting pieces of information cancel each other out. Using two agents, each searching for one cause yields full information collection at minimum costs. This provides a rationale for advocacy in political and judicial systems. In this paper, we provide a rationale for the sequential nature of information collection in advocacy systems. If two agents search simultaneously, the incentive to continue searching is affected by the information found by the other agent. This forces the principal to leave rents to the agents. If agents search sequentially, the reward can be made conditional on the information found in earlier stages. This reduces the cost of information collection. However, sequential advocacy implies either a more sluggish decision-making process or a less-informed decision

On the Role of the Governmental Agreement in Breaking Political Deadlocks

Resistance to socially desired reforms may arise from uncertainty about the consequences of reforms at the individual level (Fernandez and Rodrik, 1991). Without a binding commitment, a promise to compensate losers will not raise support for reforms due to a credibility problem. This paper shows that voting simultaneously on several reforms may solve the credibility problem. It is argued that the governmental agreement in the Netherlands has served as a means to vote simultaneously on several reforms and has helped breaking political deadlocks. Moreover, our model provides an explanation for some perceived changes in the Dutch policy making process

Voting on the budget deficit: Comment

In this comment, it is argued that a balanced-budget rule may cause underinvestment. As a consequence, such a rule is not ex ante efficient: in order to achieve the ex ante optimal outcome, it would be necessary to add an extra rule for the level of public investment. Unfortunately, however, such an investment rule is likely to be very difficult to implement in practice. When there are no rules to prevent underinvestment, it is no longer clear whether a balanced-budget rule is beneficial or not. In some cases, the cost of low levels of investment outweigh the benefits of a balanced budget

Look Who’s Talking: Host and pathogen drivers of staphylococcus epidermidis virulence in neonatal sepsis

Preterm infants are at increased risk for invasive neonatal bacterial infections. S. epidermidis, a ubiquitous skin commensal, is a major cause of late-onset neonatal sepsis, particularly in high-resource settings. The vulnerability of preterm infants to serious bacterial infections is commonly attributed to their distinct and developing immune system. While developmentally immature immune defences play a large role in facilitating bacterial invasion, this fails to explain why only a subset of infants develop infections with low-virulence organisms when exposed to similar risk factors in the neonatal ICU. Experimental research has explored potential virulence mechanisms contributing to the pathogenic shift of commensal S. epidermidis strains. Furthermore, comparative genomics studies have yielded insights into the emergence and spread of nosocomial S. epidermidis strains, and their genetic and functional characteristics implicated in invasive disease in neonates. These studies have highlighted the multifactorial nature of S. epidermidis traits relating to pathogenicity and commensalism. In this review, we discuss the known host and pathogen drivers of S. epidermidis virulence in neonatal sepsis and provide future perspectives to close the gap in our understanding of S. epidermidis as a cause of neonatal morbidity and mortality

Legalising Land Rights, Yes But How? An Introduction

Rule of Law and Development: Formation, Implementation and Improvement of Law and Governance in Developing Countrie

Does d-cycloserine facilitate the effects of homework compliance on social anxiety symptom reduction?

BACKGROUND: Prior studies examining the effect of d-cycloserine (DCS) on homework compliance and outcome in cognitive-behavior therapy (CBT) have yielded mixed results. The aim of this study was to investigate whether DCS facilitates the effects of homework compliance on symptom reduction in a large-scale study for social anxiety disorder (SAD). METHODS: 169 participants with generalized SAD received DCS or pill placebo during 12-session exposure-based group CBT. Improvements in social anxiety were assessed by independent raters at each session using the Liebowitz social anxiety scale (LSAS). RESULTS: Controlling for LSAS at the previous session, and irrespective of treatment condition, greater homework compliance in the week prior related to lower LSAS at the next session. However, DCS did not moderate the effect of homework compliance and LSAS, LSAS on homework compliance, or the overall augmenting effect of DCS on homework compliance. Furthermore, LSAS levels were not predictive of homework compliance in the following week. CONCLUSION: The findings support the general benefits of homework compliance on outcome, but not a DCS-augmenting effect. The comparably small number of DCS-enhanced sessions in this study could be one reason for the failure to find a facilitating effect of DCS

Automatic structures for semigroup constructions

We survey results concerning automatic structures for semigroup constructions, providing references and describing the corresponding automatic structures. The constructions we consider are: free products, direct products, Rees matrix semigroups, Bruck-Reilly extensions and wreath products.Comment: 22 page

Enhancement of psychosocial treatment with D-cycloserine: models, moderators, and future directions

Advances in the understanding of the neurobiology of fear extinction have resulted in the development of d-cycloserine (DCS), a partial glutamatergic N-methyl-D-aspartate agonist, as an augmentation strategy for exposure treatment. We review a decade of research that has focused on the efficacy of DCS for augmenting the mechanisms (e.g., fear extinction) and outcome of exposure treatment across the anxiety disorders. Following a series of small-scale studies offering strong support for this clinical application, more recent larger-scale studies have yielded mixed results, with some showing weak or no effects. We discuss possible explanations for the mixed findings, pointing to both patient and session (i.e., learning experiences) characteristics as possible moderators of efficacy, and offer directions for future research in this area. We also review recent studies that have aimed to extend the work on DCS augmentation of exposure therapy for the anxiety disorders to DCS enhancement of learning-based interventions for addiction, anorexia nervosa, schizophrenia, and depression. Here, we attend to both DCS effects on facilitating therapeutic outcomes and additional therapeutic mechanisms beyond fear extinction (e.g., appetitive extinction, hippocampal-dependent learning).F31 MH103969 - NIMH NIH HHS; K24 DA030443 - NIDA NIH HHS; R34 MH099309 - NIMH NIH HHS; R34 MH086668 - NIMH NIH HHS; R21 MH102646 - NIMH NIH HHS; R34 MH099318 - NIMH NIH HH