Mixed signals: central bank independence, coordinated wage bargaining, and European Monetary Union

Plans for European Monetary Union are based on the conventional postulate that increasing the independence of the central bank can reduce inflation without any real economic effects. However, the theoretical and empirical bases for this claim rest onmodels of the economy that make unrealistic information assumptions and omitinstitutional variables other than the central bank. When the signaling problems between the central bank and other actors in the political economy are considered,we find that the character of wage bargaining conditions the impact of central bankindependence by rendering the signals between the bank and the bargainers moreor less effective. Greater independence can reduce inflation without majoremployment effects where bargaining is coordinated, but it brings higher levels ofunemployment where bargaining is uncoordinated. Thus, currency unions like the EMU may require higher levels of unemployment to control inflation than their proponents envisage; they will have costs as well as benefits, costs which will bedistributed unevenly among and within the member nations based on the changesinduced in the status of the bank and of wage coordination -- Die Konzepte für die Europäische Währungsunion basieren auf dem allgemeinvertretenen Postulat, daß mit größerer Unabhängigkeit der Zentralbank die Inflationohne reale ökonomische Effekte verringert werden kann. Allerdings beruht die theoretische wie empirische Basis für diesen Anspruch auf Modellvorstellungen einer Volkswirtschaft, die auf unrealistischen Annahmen der Bedeutung von Informationen beruhen und institutionelle Variable - mit Ausnahme der Zentralbank - außer acht lassen. Wird allerdings die wechselseitige Wahrnehmung und Interpretation vonInformationen (signaling problems) zwischen Zentralbank und den anderenAkteuren in der politischen Ökonomie in die Analyse einbezogen, dann ist festzustellen, daß die Art der Lohnfindung die Intensität der Auswirkungen derZentralbankunabhängigkeit beeinflußt je nachdem, wie wirksam die wechselseitige Wahrnehmung und Interpretation von Informationen zwischen der Zentralbank und den Tarifpartnern vermittelt ist.Im Falle koordinierter Tarifverhandlungen kann eine größere Unabhängigkeit derZentralbank die Inflation in der Tat ohne größere Beschäftigungseffekte vermindern,im Falle unkoordinierter Tarifverhandlungen führt dies allerdings zu einem höherenNiveau der Arbeitslosigkeit. Daraus leitet sich die Überlegung ab, daß eineWährungsunion vom Typ Europäische Währungsunion ein höheres Maß an Arbeitslosigkeit erfordert, um die Inflation unter Kontrolle zu halten, als es ihre Befürworter erwarten. Bei den sich dann einstellenden Vor- und Nachteilen werden die Nachteile zwischen und innerhalb der Mitgliedstaaten ungleich verteilt sein, abhängig von dem letztendlich verwirklichten Grad der Unabhängigkeit derZentralbank und der Form der Lohnfindung.

Modeling international diffusion: Inferential benefits and methodological challenges, with an application to international tax competition

Although scholars recognize that time-series-cross-section data typically correlate across both time and space, they tend to model temporal dependence directly, often by lags of dependent variables, but to address spatial interdependence solely as a nuisance to be “corrected” by FGLS or to which to be “robust” in standard-error estimation (by PCSE). We explore the inferential benefits and methodological challenges of directly modeling international diffusion, one form of spatial dependence. To this end, we first identify two substantive classes of modern comparative-and-international-political-economy (C&IPE) theoretical models—(context-conditional) open-economy comparative political-economy (CPE) models and international political-economy (IPE) models, which imply diffusion (along with predecessors, closed-economy CPE and orthogonal open-economy CPE)—and then we evaluate the relative performance of three estimators—non-spatial OLS, spatial OLS, and spatial 2SLS—for analyzing empirical models corresponding to these two modern alternative theoretical visions from spatially interdependent data. Finally, we offer a substantive application of the spatial 2SLS approach in what we call a spatial error-correction model of international tax competition. -- Obwohl Wissenschaftler wissen, dass Zeitreihenquerschnittsdaten sowohl über die Zeit als auch über den Raum korreliert sind, neigen sie dazu, die zeitliche Abhängigkeit direkt zu modellieren, z. B. durch Zeitabstände der abhängigen Variablen. Die räumliche Abhängigkeit jedoch wird als ein Ärgernis angesehen, welches durch FGLS ‚korrigiert’ wird oder ‚robust’ gemacht wird in Standard- Abweichungs-Schätzungen (durch PCSE). Wir untersuchen methodologische Herausforderungen und die Nutzen für Schlussfolgerungen aus einer direkten Modellierung internationaler Diffusion als einer Form der räumlichen Abhängigkeit. Zu diesem Zweck identifizieren wir zuerst zwei inhaltliche Hauptklassen theoretischer Modelle der modernen ‚Vergleichenden und Internationalen Politischen Ökonomie“, nämlich Modelle der (kontextbezogenen) Vergleichenden Politischen Ökonomie Offener Volkwirtschaften und Modelle der Internationalen Politischen Ökonomie. Diese bilden Diffusion ab, ebenso wie die Vorläufermodelle der Vergleichenden Politischen Ökonomie geschlossener Volkswirtschaften und gegensätzlich offener Volkswirtschaften. Zweitens bewerten wir die relative Performanz von drei Schätzern – nicht-räumliche OLS, räumliche OLS und räumliche 2SLS. Schließlich wenden wir den Ansatz des räumlichen 2SLS in einem von uns so genannten ‚Spatial Error Correction’-Modell des internationalen Steuerwettbewerbs an.International Tax Competition,Panel Models,Policy Diffusion,Political Economy,Spatial Interdependence

Global Capital, Political Institutions, and Policy Change in Developed Welfare States by Duane Swank

Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/97236/1/j.1538-165X.2003.tb01189.x.pd

Mixed signals: central bank independence, coordinated wage bargaining, and European Monetary Union

"Die Konzepte für die Europäische Währungsunion basieren auf dem allgemeinen vertretenden Postulat, dass mit größerer Unabhängigkeit der Zentralbank die Inflation ohne reale ökonomische Effekte verringert werden kann. Allerdings beruht die theoretische wie empirische Basis für diesen Anspruch auf Modellvorstellungen einer Volkswirtschaft, die auf unrealistischen Annahmen der Bedeutung von Informationen beruhen und institutionelle Variablen - mit Ausnahme der Zentralbank - außer acht lassen. Wird allerdings die wechselseitige Wahrnehmung und Interpretation von Informationen ('signaling problems') zwischen Zentralbank und den anderen Akteuren in der politischen Ökonomie in die Analyse einbezogen, dann ist feszustellen, dass die Art der Lohnfindung die Intensität der Auswirkungen der Zentralbankunabhängigkeit beeinflusst je nachdem, wie wirksam der Zentralbank und den Tarifpartnern vermittelt ist. Im Falle koordinierter Tarifverhandlungen kann eine größere Unabhängigkeit der Zentralbank die Inflation in der Tat ohne größere Beschäftigungseffekte vermindern, im Falle unkoordinierter Tarifverhandlungen führt dies allerdings zu einem höheren Niveau der Arbeitslosigkeit. Daraus leitet sich die Überlegung ab, dass eine Währungsunion vom Typ 'Europäische Währungsunion' ein höheres Maß an Arbeitslositkeit einfordert, um die Inflation unter Kontrolle zu halten, als es ihre Befürworter erwarten. Bei den sich dann einstellenden Vor- und Nachteilen werden die Nachteile zwischen und innerhalb der Mitgliedsstaaten ungleich verteilt sein, abhängig von dem letztendlich verwirklichten Grad der Unabhängigkeit der Zentralbank und der Form der Lohnfindung." (Autorenreferat)"Plans for European Monetary Union are based on the conventional postulate that increasing the independence of the central bank can reduce inflation without any real economic effects, However, the theoretical and empirical bases for this claim rest on models of the economy that make unrealistic information assumptions and omit institutional variables other than the central bank. When the signaling problems between the central bank and other actors in the political economy are considered, we find that the character of wage bargaining conditions the impact of central bank independence by rendering the signals between the bank and the bargainers more or less effective. Greater independence can reduce inflation without major employment effects where bargaining is coordinated, but it brings higher levels of unemployment where bargaining is uncoordinated. Thus, currency unions like the EMU may require higher levels of unemployment to control inflation than their proponents envisage; they will have costs as well as benefits, costs which will be distributed unevenly among and within the member nations based on the changes induced in the status of the bank and of wage coordination." (author's abstract

Modeling History Dependence in Network-Behavior Coevolution

Spatial interdependence--the dependence of outcomes in some units on those in others--is substantively and theoretically ubiquitous and central across the social sciences. Spatial association is also omnipresent empirically. However, spatial association may arise from three importantly distinct processes: common exposure of actors to exogenous external and internal stimuli, interdependence of outcomes/behaviors across actors (contagion), and/or the putative outcomes may affect the variable along which the clustering occurs (selection). Accurate inference about any of these processes generally requires an empirical strategy that addresses all three well. From a spatial-econometric perspective, this suggests spatiotemporal empirical models with exogenous covariates (common exposure) and spatial lags (contagion), with the spatial weights being endogenous (selection). From a longitudinal network-analytic perspective, we can identify the same three processes as potential sources of network effects and network formation. From that perspective, actors\u27 self-selection into networks (by, e.g., behavioral homophily) and actors\u27 behavior that is contagious through those network connections likewise demands theoretical and empirical models in which networks and behavior coevolve over time. This paper begins building such modeling by, on the theoretical side, extending a Markov type-interaction model to allow endogenous tie-formation, and, on the empirical side, merging a simple spatial-lag logit model of contagious behavior with a simple p-star logit model of network formation, building this synthetic discrete-time empirical model from the theoretical base of the modified Markov type-interaction model. One interesting consequence of network-behavior coevolution--identically: endogenous patterns of spatial interdependence--emphasized here is how it can produce history-dependent political dynamics, including equilibrium phat and path dependence (Page 2006). The paper explores these implications, and then concludes with a preliminary demonstration of the strategy applied to alliance formation and conflict behavior among the great powers in the first half of the twentieth century

Prestige Status and Social Class in the Merger of Two Catholic Parishes

The overal objective of this chapter is to outline the purposes and strategies of this thesis. A statement will be made concerning the setting that was studied, and the methodological techniques that have been employed in the research. Prior to handling these, however, a basic statement of the reasons for studying the community will be set forth. This introductory chapter will close with an outline of the organisation of the thesis

Strategic Interactions of Monetary Policymakers and Wage/Price Bargainers: A Review with Implications for the European Common-Currency Area

This paper reviews recent work on macroeconomic management with varying organization of wage/price bargaining and degrees of credible monetary conservatism. The emerging literature synthesizes and extends theory and empirics on central bank independence (CBI) and coordinated wage/price bargaining (CWB), arguing that the degrees of CBI and CWB interact with each other and with other political-economic conditions (sectoral composition, international exposure, etc.) to structure the incentives facing actors involved in monetary policy and wage/price bargaining. The core implication, theoretically surprising but empirically supported, is that even perfectly credible monetary conservatism has long-run , equilibrium , on-average real effects, even with fully rational expectations, and that these effects depend on the organization of wage/price bargaining. Conversely, wage/price-bargaining structure has real effects that depend on the degree of credible conservatism reflected in monetary-policy rules. Each also has interactive nominal effects though this is less surprising. Some disagreement remains over the precise nature of these interactive effects, but all emerging theory and evidence agree that a common, credibly conservative European monetary policy has nominal and real effects that depend on the Europe-wide institutional-structural organization of wage/price bargaining. Indeed, the one specific piece of theoretical and empirical agreement suggests that, for many member countries, the nominal gains from monetary-policy delegation to a credibly conservative European Central Bank will worsen these bargaining-policy interactions.Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/42697/1/10663_2004_Article_388059.pd

Network Selection and Path-Dependent Coevolution

Scholars have increasingly become aware that actors’ self-selection into networks (e.g., homophily) is an important determinant of network-tie formation. Such self-selection adds methodological complexity to the empirical evaluation of the effects of network ties on individual behavior. Moreover, the endogenous network formation implies that network-tie structures and actors’ behavior “coevolve” over time. Therefore, in longitudinal network studies, it is very crucial for scholars to understand the nature of coevolutionary dynamics in the data, in order to explain the network-formation and the behavioral-decision-making mechanisms accurately. In this project, we claim that one of the most important aspects of the coevolutionary dynamic is its connection with history dependence. By history dependence, we primarily focus on what Page (2006) defines as “phat” and path dependence. We first establish theoretically that systems with coevolution can easily generate multiple equilibria (i.e., the steady states of the system), using a simple Markov type-interaction model that allows for endogenous tie formation. The potential of multiple equilibria posits an important and very difficult empirical question--how sensitive are equilibrium distributions (over types) to the past states? More simply put, to what extent does history matter? What is at stake in this question is not trivial. If history matters for an equilibrium attained in the society, then we can also analyze the potential policy interventions that could change the path of the social process such that it would lead to a socially optimal equilibrium. As for the empirical strategy, we start with developing a discrete-time Markov model, combining a spatial-logit and p-star model to evaluate the empirical significance of coevolutionary dynamics in the data. The strength of this empirical approach is in its direct connection with the theoretical Markov interaction model, and can provide a foundation for developing statistical tests for history dependence generated by coevolution

Dose-intensified stereotactic body radiotherapy for painful vertebral metastases: A randomized phase 3 trial.

BACKGROUND The purpose of this randomised study was to determine whether dose-intensified stereotactic body radiotherapy (SBRT) for painful vertebral metastases results in increased rates of pain improvement compared with conventional external beam radiotherapy (cEBRT) (control) 6 months after treatment. METHODS This randomized, controlled phase 3 trial was conducted between November 2016 and January 2023, when it was stopped early. Patients were eligible if they were aged 18 years or older; had one or two painful, stable, or potentially unstable vertebral metastases; and had a life expectancy of 1 year or longer according to the investigator's estimates. Patients received 48.5 grays (Gy) in 10 fractions (with epidural involvement) or 40 Gy in five fractions (without epidural involvement) in the SBRT group and 30 Gy in 10 fractions or 20 Gy in five fractions in the cEBRT group, respectively. The primary end point was an improvement in the pain score at the treated site by at least 2 points (on a visual analog scale from 0 to 10 points) at 6-month follow-up. Data were analyzed on an intention-to-treat and per-protocol basis. RESULTS Of 214 patients who were screened for eligibility, 63 were randomized 1:1 between SBRT (33 patients with 36 metastases) and cEBRT (30 patients with 31 metastases). The median age of all patients was 66 years, and 40 patients were men (63.5%). In the intention-to-treat analysis, the 6-month proportion of patients who had metastases with pain reduction by 2 or more points was significantly higher in the SBRT group versus the control group (69.4% vs. 41.9%, respectively; two-sided p = .02). Changes in opioid medication intake relative to baseline were nonsignificant between the groups. No differences were observed in vertebral compression fracture or adverse event rates between the groups. CONCLUSIONS Dose-intensified SBRT improved pain score more effectively than cEBRT at 6 months