External Shocks, Structural Breaks and Unemployment Hysteresis in China

This paper aims to investigate the unemployment hysteresis hypothesis, in which the endogenously determined break points are incorporated, by using annual data of actual urban unemployment rates during 1978-2009 in China. We treat the break date as unknown and utilize recursive, rolling and sequential tests to determine the endogenous structural breaks which are caused by external shocks. Our empirical findings show that three structural breaks existed in the time series of China’s actual urban unemployment rates and we can not reject the unit-root hypothesis, which is consistent with the hysteresis hypothesis of unemployment. Key words: Structural breaks; Unemployment hysteresis; External shock

Oxidative Stability of Egg and Soy Lecithin as Affected by Transition Metal Ions and pH in Emulsion

Oxidative stability of egg and soy lecithin in emulsion was evaluated with two transition metal ions, cupric and ferric ion, at two concentration levels (50 and 500 μM). The effect of pH on lipid oxidation was also examined under these two concentrations for each ion. Egg lecithin (EL) had similar peroxide value (PV) development pattern as soy lecithin (SL) when treated with cupric ion under both acidic and neutral pH. Acidic pH of 3 accelerated oxidation of both EL and SL, especially under high concentration of copper. When treated with ferric ion, EL oxidized much faster than SL did. EL had higher value of thiobarbituric acid-reactive substances (TBARS) than SL, possibly because of its higher content of long-chain polyunsaturated fatty acids (PUFA). Acidic pH accelerated TBARS development for both EL and SL, but EL had more significantly increased values. Cupric ion was more powerful than ferric in catalyzing oxidation of both EL and SL under both acidic and neutral pH conditions as measured by PV and TBARS. Linoleic acid may contribute to higher PV production, however, arachidonic acid and docosahexaenoic acid may have contributed more to TBARS production. Overall, SL showed better oxidative stability than EL under the experimental conditions. This study also suggests that using multiple methods is necessary in properly evaluating lipid oxidative stability

Well-posedness of The Prandtl Equation in Sobolev Spaces

We develop a new approach to study the well-posedness theory of the Prandtl equation in Sobolev spaces by using a direct energy method under a monotonicity condition on the tangential velocity field instead of using the Crocco transformation. Precisely, we firstly investigate the linearized Prandtl equation in some weighted Sobolev spaces when the tangential velocity of the background state is monotonic in the normal variable. Then to cope with the loss of regularity of the perturbation with respect to the background state due to the degeneracy of the equation, we apply the Nash-Moser-Hormander iteration to obtain a well-posedness theory of classical solutions to the nonlinear Prandtl equation when the initial data is a small perturbation of a monotonic shear flow

Interest Rate Pegging, Fluctuations, and Fiscal Policy in China

This paper proves in a New Keynesian model that interest rate pegging can explain the unusual business cycle fluctuations in China. It is traditional wisdom that when the nominal interest rate is inflexible, there is no unique equilibrium in macroeconomic models. We prove that a unique equilibrium exists if the nominal rate is pegged for a limited period, after which it switches to a flexible rate regime. The peg alters the propagation of external shocks, magnifies volatility of endogenous variables, and leads to instability of the economy. Besides, the model becomes more unstable when the peg duration extends, and when the pegged rate deviates from steady state. At the same time, fiscal multiplier increases under the peg, indicating fiscal policy may be more effective in mitigating economic fluctuations when monetary policy is restricted by interest rate pegging