Financial Instability and Optimal Monetary Policy Rule

This paper investigates the effect of financial instability on the design of monetary policy rule for a small open economy. We find evidence that optimal monetary policy rule reacts directly to financial imbalances and, as a result, to the real exchange rate movements. However, optimal rule would not react to the real exchange rate changes directly if central bank does not care about the financial instability. For a quantitative analysis, impulse responses of some macroeconomic variables and financial instability to the domestic productivity and foreign country output shocks, resulting from simulation, are also analysed in this paper.Financial instability, Optimal monetary policy rule, Real exchange rate, Open economy

Forecasting by Stochastic Models to Inflow of Karkheh Dam at Iran

Forecasting the inflow of rivers to reservoirs of dams has high importance and complexity. Design and optimal operation of the dams is essential. Mathematical and analytical methods use for understanding estimating and prediction of inflow to reservoirs in the future. Various methods including stochastic models can be used as a management tool to predict future values of these systems. In this study stochastic models (ARIMA) are applied to records of mean annual flow Karkheh river entrance to Karkheh dam in the west of Iran. For this purpose we collected annual flow during the period from 1958/1959 to 2005/2006 in Jelogir Majin hydrometric station. The available data consists of 48 years of mean Annual discharge. Three types of ARIMA (p, d, q) models (0, 1, 1), (1, 1, 1) and (4, 1, 1) suggested, and the selected model is the one which give minimum Akaike Information Criterion (AIC). The Maximum Likelihood (ML), Conditional Least Square (CLS) and Unconditional Least Square (ULS) methods are used to estimate the model parameters. It is found that the model which corresponds to the minimum AIC is the (4, 1, 1) model in CLS estimation method. Port Manteau Lack of fit test and Residual Autocorrelation Function (RACF) test are applied as diagnostic checking. Forecasting of annual inflow for the period from 2006 to 2015 are compared with observed inflow for the same period and since agreement is very good adequacy of the selected model is confirmed

Modeling Climate Variables of Rivers Basin using Time Series Analysis (Case Study: Karkheh River Basin at Iran)

Stochastic models (time series models) have been proposed as one technique to generate scenarios of future climate change. Precipitation, temperature and evaporation are among the main indicators in climate study. The goal of this study is the simulation and modeling of climatic parameters such as annual precipitation, temperature and evaporation using stochastic methods (time series analysis). The 40-year data of precipitation and 37-year data of temperature and evaporation at Jelogir Majin station (upstream of Karkheh dam reservoir) in western of Iran has been used in this study and based on ARIMA model, The auto-correlation and partial auto-correlation methods, assessment of parameters and types of model, the suitable models to forecast annual precipitation, temperature and evaporation were obtained. After model validation and evaluation, the Predicting was made for the ten future years (2006 to 2015). In view of the Predicting made, the precipitation amounts will be decreased than recent years. As regards the mean of annual temperature and evaporation, the findings of the Predicting show an increase in temperature and evaporation

Analytical and Laboratory Evaluation of the Solubility of Gypsiferous Soils

Gypsum soil is one of the problematic soils because of considerable solubility for Gypsum particles in contact with water. In this research the effects of three factors including; gypsum percent, hydraulic gradient and soil texture were studied on solubility of gypsum soils. To do this, samples of gypsum soils were provided artificially by adding various rates of natural gypsum rock including 0, 5, 10, 20 and 30 percent weight of 3 kinds of soil textures including clay, silty clay and sand. Totally, 15 types of gypsum soils were prepared. Then each of gypsum soils were leached under five hydraulic gradients levels 0.5, 1, 2, 5 and 10. The results of the test indicated that the rate of Gypsum in the soil had direct effect on the rate of soluble and by increasing the percent of Gypsum, the rate of solubility was increased. In addition, by increasing hydraulic gradient, the speed of water existing soil media in a specified time was increased and also higher rate of Gypsum was derived. Also the soil texture has a considerable effect on the rate of solubility of soil. In this study, rate of solubility of gypsum soils with sandy soils was determined as 1.5 to 2 times more than the rate of clay soils. The   statistical   results show the highest impact of gypsum percentage and lowest impact of hydraulic gradient soil on solubility of particles in different types of soils and it has no significant effect on the overall equation of the soil texture

Poole-Frenkel Conduction in Cu/Nano-SnO 2

It is well known that metal/Tin-dioxide/metal sandwich structures exhibit a field-assisted lowering of the potential barrier between donor-like center and the conduction band edge, known as the Poole-Frenkel effect. This behavior is indicated by a linear dependence of Iog  on 1/2, where is the current density, and is the applied voltage. In this study, the electrical properties of Cu/nano-SnO2/Cu sandwich structures were investigated through current-voltage measurements at room temperature. Also, an attempt to explore the governing current flow mechanism was tried. Our results indicate that noticeable feature appearing clearly in the current-voltage characterization is the Poole-Frenkel and space-charge-limited conduction mechanisms

Identification of Proximal and Distal 22q11.2 Microduplications among Patients with Cleft Lip and/or Palate: A Novel Inherited Atypical 0.6 Mb Duplication

Misalignments of low-copy repeats (LCRs) located in chromosome 22, particularly band 22q11.2, predispose to rearrangements. A variety of phenotypic features are associated with 22q11.2 microduplication syndrome which makes it challenging for the genetic counselors to recommend appropriate genetic assessment and counseling for the patients. In this study, multiplex ligation probe dependent amplification (MLPA) analysis was performed on 378 patients with cleft lip and/or palate to characterize rearrangements in patients suspected of 22q11.2 microduplication and microdeletion syndromes. Of 378 cases, 15 were diagnosed with a microdeletion with various sizes and 3 with duplications. For the first time in this study an atypical 0.6 Mb duplication is reported. Illustration of the phenotypes associated with the microduplications increases the knowledge of phenotypes reported in the literature

Essays on Financial Stability in EMEAP Countries

This thesis analyses financial stability in eight members of the Executives’ Meeting of East Asia-Pacific Central Banks (EMEAP) economies. One of the factors that may increase financial imbalances (and hence it affects financial stability of an economy) is the accumulated outstanding debt of the economic agents. For example, the corporate sector’s outstanding debt can negatively affect activity of lenders and hence the capabilities of the economy. Since banks are important financial intermediaries in most financial systems, the financial status of banking sector is also important to analyse financial stability of a country. Macroeconomic conditions and financial system structure are some of the important factors that can affect financial conditions (financial soundness) of banks and hence the banking sector. Financial soundness of banks can secure the stability of the financial system. Chapter 2 shows that financial imbalances that arise from accumulated outstanding debt within the corporate sector have a negative effect on the technical capabilities (total factor productivity) of the economy. Therefore, monetary authority (central bank) should control over the debt level. To address this, chapter 2 focuses on the design of monetary policy rule for a small open economy in the context of a Dynamic Stochastic General Equilibrium (DSGE) model. This model is extended to show the effects of financial imbalances on the economy. Real exchange rate is another important factor that affects the firm’s real marginal cost, aggregate supply and aggregate demand as discussed in this chapter. The derived optimal monetary policy rule indicates that the monetary authority responds to financial imbalances through output gap when financial imbalances exist due to accumulated outstanding debt. Moreover, the optimal policy rule shows that the response of the monetary authority to exchange rate movements is indirect, through the domestic inflation and output gap. Chapter 3 describes the effect of the financial system structure on financial stability through investigating the financial soundness of the banking sector. Bank financial soundness is the measure of the stability of the financial system and is defined by return on assets, equity capital-asset ratio and return volatility. The first two items increase financial soundness, whereas return volatility decreases financial soundness of a bank. The structure of the financial system is described as market-based or bank-based. Given interrelations between financial sectors and between economies of the EMEAP countries, chapter 3 uses the global (infinite dimensional) vector autoregressive (VAR) model that has been proposed recently to estimate the generalised impulse responses of financial stability measure. Results show that the market-based financial system can increase financial stability through increasing financial soundness of the banking system. Chapter 4 uses nonperforming loans (NPLs) (as one of the main factors behind Asian financial crisis in 1997/8) to analyse financial soundness of banks. NPLs determine loans default rates that decreases banks’ financial soundness. Chapter 4 tests the resistance of the banking system of the EMEAP countries to large macroeconomic shocks (stresses) in a stress-test framework, computing frequency distributions of default rates in three main macroeconomic scenarios (baseline model, stressed real GDP growth and stressed real interest rate). Default rate indicates the possible loss of banks and hence it is an indicator of credit risk which weakens banks’ financial strength. The stress-test indicates that stressing real GDP growth with negative extreme shocks leads to an increase in frequency of higher default rates (in comparison with the baseline model), whereas positive shock to real interest rate may secure financial stability through increasing the frequency of lower default rates and decreasing frequency of higher default rate