The Convergence Dynamics of a Transition Economy

In this paper we develop a two-country dynamic general equilibrium model by means of which we seek to explain the long-run paths of a converging emerging market economy. We borrow a paradigm from the New Open Economy Macroeconomics literature and amend it to address specific features such as initial asymmetry in development and size of economies as well as different speed of capital accumulation. Using a calibration of productivity and deep parameters for the Czech economy we demonstrate the ability of the model to consistently replicate dynamics in key macroeconomic variables that are essential inputs for commonly used "gap models" in monetary policy routine. Based on the calibration we draw implications for future convergence of the Czech economy.Economic indicators;Emerging markets;Economic models;exchange rate, real exchange rate, transition economy, transition economies, exchange rate appreciation, real exchange rate appreciation, open economy, domestic market, output growth, transition countries, exchange rate movements, exchange rate regimes, endogenous growth, monetary integration, export costs, export performance, economic convergence, economic integration, balance of payments, tradable goods, domestic goods, investment goods, terms of trade, exchange rates, domestic production, external liberalization, exchange rate fluctuations, international trade, income differentials, market equilibrium, trade openness, exchange rate regime, exchange rate development, benchmark equilibrium, external position, real exchange rate movements, trade liberalization, idiosyncratic shocks, monetary union, flexible exchange rate regimes, real exchange rate fluctuations, domestic investment, policy regimes, real exchange rates, world price, foreign trade, exchange rate dynamics, intermediate goods, equilibrium model, full liberalization, perfect competition, exchange rate changes, trade barriers, economic community, equilibrium exchange rate, political economy, foreign investment, export dynamics, skilled labor, flexible exchange rate, domestic firms, exchange rate path, domestic economy, impact of trade, exchange rate flexibility, elasticity of substitution, foreign ownership, income convergence, foreign exchange rate, foreign exchange, policy barriers, real exchange rate path, price liberalization, export structure, domestic consumption

Charge correlations using the balance function in Pb–Pb collisions at √sNN =2.76 TeV

In high-energy heavy-ion collisions, the correlations between the emitted particles can be used as a probe to gain insight into the charge creation mechanisms. In this Letter, we report the first results of such studies using the electric charge balance function in the relative pseudorapidity (∆η) and azimuthal angle (∆φ) in Pb–Pb collisions at √sNN =2.76 TeV with the ALICE detector at the Large Hadron Collider. The width of the balance function decreases with growing centrality (i.e. for more central collisions) in both projections. This centrality dependence is not reproduced by HIJING, while AMPT, a model which incorporates strings and parton rescattering, exhibits qualitative agreement with the measured correlations in ∆φ but fails to describe the correlations in ∆η. A thermal blast-wave model incorporating local charge conservation and tuned to describe the pT spectra and v2 measurements reported by ALICE, is used to fit the centrality dependence of the width of the balance function and to extract the average separation of balancing charges at freeze-out. The comparison of our results with measurements at lower energies reveals an ordering with √sNN: the balance functions become narrower with increasing energy for all centralities. This is consistent with the effect of larger radial flow at the LHC energies but also with the late stage creation scenario of balancing charges. However, the relative decrease of the balance function widths in ∆η and ∆φ with centrality from the highest SPS to the LHC energy exhibits only small differences. This observation cannot be interpreted solely within the framework where the majority of the charge is produced at a later stage in the evolution of the heavy-ion collision