Measuring Intratemporal and Intertemporal Substitutions When Both Income and Substitution Effects Are Present: The Role of Consumer Durables

Hall (1988) estimates the intertemporal substitutability for nondurable goods economically and statistically insignificant. Ogaki and Reinhart (1998) introduce the service flow from durable goods using within-period-nonseparable homothetic preference specification. They estimate the intertemporal substitutability significant - around 0.4, and the intratemporal substitutability greater than one. I show that homotheticity induces a surprisingly dramatic statistical bias in the estimates of the intratemporal and intertemporal substitutions. Using aggregate consumption data, I discover that the estimate of the intertemporal substitutability is economically quite negligible - on the order of 0.04, a magnitude close to Hall’s original estimate. In addition, I estimate the intratemporal substitutability between nondurable goods and service flow from the stock of consumer durable goods economically small as well - around 0.18. In addition, I find potent support in favor of nonhomotheticity, with nondurable goods being necessities and durable goods luxuries. Despite that, due to the secular decline of the rental cost, the budget share of consumer durable goods appears trendless.

Equity Prices Under Bayesian Doubt About Macroeconomic Fundamentals

I present a consumption-based explanation of a number of phenomena in the aggregate equity market. The model invokes the recursive utility function of Epstein and Zin (1989), configured with the plausible parameters of the average coefficient of the aversion to late resolution of uncertainty of about 22, and the elasticity of intertemporal substitution of 1.5. Statistically hard to discriminate in less than 80 years of data from the ubiquitous model of real consumption growth, the endowment process is specified as being subject to sporadic large shocks and incessant small shocks. The large infrequent shocks, modelled by means of a four-state hidden Markov chain, display interesting macroeconomic regularities, occuring at both the business-cycle, and a lower, frequencies. Despite the fact that the levels of endowments are observable, the source of their variation cannot be detected perfectly, facing investors with a complex signal-extraction problem. The associated posterior probabilities provide a natural link between the observed asset value fluctuations and the economic uncertainty within the rational Bayesian learning framework. Although computationally arduous, having to be solved on a high-performance computing machine in a low-level language, the model is able to account for (i) the observed magnitude of the equity premium, (ii) the low and stable risk-free rate, (iii) the magnitude and the countercyclicality of risk prices, (iv) the average levels and the procyclicality of price-dividend and wealth-consumption ratios, (v) the long-horizon predictability of risk premia, and (vi) the overreaction of price-dividend ratio to bad news in good times, all within the conceptually simple representative-agent framework.

Asset Pricing with Home Capital

I analyze a stylized consumption-based asset pricing model that features heterogeneous agents and household capital, and discover a novel recession risk factor related to the cross-sectional second moments of the corresponding investments into such home capital. In order to fully isolate the orthogonal effects at work, I completely shut off the well-known mechanism of Constantinides and Duffie (1996) by explicitly stipulating homoscedastic cross-sectional distribution of nondurable goods and services.

Estimating intertemporal and intratemporal substitutions when both income and substitution effects are present: the role of durable goods

Homotheticity induces a dramatic statistical bias in the estimates of the intratemporal and intertemporal substitutions. I find potent support in favor of nonhomotheticity in aggregate consumption data, with nondurable goods being necessities and durable goods luxuries. I obtain the intertemporal substitutability negligible (0.04), a magnitude close to Hall’s (1988) original estimate, and the intratemporal substitutability between nondurable goods and service flow from the stock of durable goods small as well (0.18). Despite that, due to the secular decline of the rental cost, the budget share of durable goods appears trendless.consumption, durable goods, nonhomotheticity, elasticity of substitution, asset pricing

Use of Acellular Dermal Matrix to Prevent Recurrence of Radioulnar Heterotopic Ossification.

Radioulnar heterotopic ossification is a rare occurrence found in approximately 2% of all forearm injuries. Treatment is complicated by relatively high recurrence rates. Strategies to decrease recurrence have included the range of motion exercises and the interposition of inert or autogenous barriers. We report on the interposition of human acellular dermal matrix (ADM) for the treatment of distal radioulnar synostosis. We report a novel technique for the treatment of distal radioulnar heterotopic ossification. After resection, ADM in a cigar-shaped construct is interposed between the radius and ulna. Patients are followed clinically and radiographically. Two female patients were treated. Both patients had significant improvement in the range of motion in supination and pronation of the affected wrist postoperatively with an average follow-up of 36 months. There were no postoperative complications. Neither patient had recurrent disease. We describe the successful treatment of 2 patients with distal radioulnar heterotopic ossification with the use of human ADM. The ADM provides a barrier between the radius and ulna to prevent the recurrent formation of heterotopic ossification. ADM usage results in no donor site morbidity and is theoretically more resistant to infection when compared with nonbiologic barriers such as silicone and Integra. This technique is a simple, safe, and effective way to treat and prevent the recurrence of radioulnar heterotopic ossification

Intraoperative Myelography in Cervical Multilevel Stenosis Using 3D Rotational Fluoroscopy: Assessment of Feasibility and Image Quality

Background. Intraoperative myelography has been reported for decompression control in multilevel lumbar disease. Cervical myelography is technically more challenging. Modern 3D fluoroscopy may provide a new opportunity supplying multiplanar images. This study was performed to determine the feasibility and image quality of intraoperative cervical myelography using a 3D fluoroscope. Methods. The series included 9 patients with multilevel cervical stenosis. After decompression, 10 mL of water-soluble contrast agent was administered via a lumbar drainage and the operating table was tilted. Thereafter, a 3D fluoroscopy scan (O-Arm) was performed and visually evaluated. Findings. The quality of multiplanar images was sufficient to supply information about the presence of residual stenosis. After instrumentation, metal artifacts lowered image quality. In 3 cases, decompression was continued because myelography depicted residual stenosis. In one case, anterior corpectomy was not completed because myelography showed sufficient decompression after 2-level discectomy. Interpretation. Intraoperative myelography using 3D rotational fluoroscopy is useful for the control of surgical decompression in multilevel spinal stenosis providing images comparable to postmyelographic CT. The long duration of contrast delivery into the cervical spine may be solved by preoperative contrast administration. The method is susceptible to metal artifacts and, therefore, should be applied before metal implants are placed

Structural Characterization of the Extracellular Domain of CASPR2 and Insights into Its Association with the Novel Ligand Contactin1

Contactin-associated protein-like 2 (CNTNAP2) encodes for CASPR2, a multidomain single transmembrane protein belonging to the neurexin superfamily that has been implicated in a broad range of human phenotypes including autism and language impairment. Using a combination of biophysical techniques, including small angle x-ray scattering, single particle electron microscopy, analytical ultracentrifugation, and bio-layer interferometry, we present novel structural and functional data that relate the architecture of the extracellular domain of CASPR2 to a previously unknown ligand, Contactin1 (CNTN1). Structurally, CASPR2 is highly glycosylated and has an overall compact architecture. Functionally, we show that CASPR2 associates with micromolar affinity with CNTN1 but, under the same conditions, it does not interact with any of the other members of the contactin family. Moreover, by using dissociated hippocampal neurons we show that microbeads loaded with CASPR2, but not with a deletion mutant, co-localize with transfected CNTN1, suggesting that CNTN1 is an endogenous ligand for CASPR2. These data provide novel insights into the structure and function of CASPR2, suggesting a complex role of CASPR2 in the nervous system