Research on Architectures for Integrated Speech/Language Systems in Verbmobil

The German joint research project Verbmobil (VM) aims at the development of a speech to speech translation system. This paper reports on research done in our group which belongs to Verbmobil's subproject on system architectures (TP15). Our specific research areas are the construction of parsers for spontaneous speech, investigations in the parallelization of parsing and to contribute to the development of a flexible communication architecture with distributed control.Comment: 6 pages, 2 Postscript figure

The Cross-Section of Output and Inflation in a Dynamic Stochastic General Equilibrium Model with Sticky Prices

In a standard dynamic stochastic general equilibrium framework, with sticky prices, the cross sectional distribution of output and inflation across a population of firms is studied. The only form of heterogeneity is confined to the probability that the ith firm changes its prices in response to a shock. In this Calvo setup the moments of the cross sectional distribution of output and inflation depend crucially on the proportion of firms that are allowed to change their prices. We test this model empirically using German balance sheet data on a very large population of firms. We find a significant counter-cyclical correlation between the skewness of output responses and the aggregate economy. Further analysis of sectoral data for the US suggests that there is a positive relationship between the skewness of inflation and aggregates, but the relation with output skewness is less sure. Our results can be interpreted as indirect evidence of the importance of price stickiness in macroeconomic adjustment.

The cross-sectional dynamics of German business cycles: a bird's eye view

We establish some stylised facts for Germany's business cycle at the level of the firm. Based on longitudinal firm-level data from the Bundesbank's balance sheet statistic covering, on average, 55,000 firms per year from 1971 to 1998, we analyse the reallocation across individual producers and, in turn, the connection of this reallocation to aggregate business cycles. The empirical results indicate a pronounced heterogeneity of real sale changes across firms. Moreover, the distribution of growth rates of firm's real sales is influenced by business cycle conditions. In particular, the cross-section skewness of real sales changes is strongly counter-cyclical. The results confirm most of the findings for the UK and the US by Higson et al. (2002, 2004) and are, therefore, robust stylised facts of the business cycle. --business cycles,cross-sectional moments,firm growth

The Cross-Section of Output and Inflation in a Dynamic Stochastic General Equilibrium Model with Sticky Prices

In a standard dynamic stochastic general equilibrium framework, with sticky prices, the cross sectional distribution of output and inflation across a population of firms is studied. The only form of heterogeneity is confined to the probability that the ith changes its prices in response to a shock. In this Calvo setup the moments of the cross sectional distribution of output and inflation depend crucially on the proportion of firms that are allowed to change their prices. We test this model empirically using German balance sheet data on a very large population of firms. We find a significant counter-cyclical correlation between the skewness of inflation and aggregates, but the relation with output is less sure. Our results can be interpreted as indirect evidence of the importance of price stickiness in macroeconomic adjustments.New-Keynesian macroeconomics, DSGE, cross-sectional distribution, firm growth

Financial literacy: a barrier to home ownership for the young?

The decision to buy a home is one of the most important choices faced by a household. Most young households who purchase a home do so using a mortgage. But mortgages are complex financial instruments and this complexity may be a barrier to less sophisticated households becoming homeowners. Using survey data from a sample of English and Welsh households we measure household financial literacy related to mortgages, including concepts such as loan duration, interest compounding and amortization. We find that in the population mortgage financial literacy is generally low and among renters mortgage financial literacy is substantially worse than among homeowners. Econometric estimates show mortgage financial literacy predicts home ownership for younger, but not for older households. Financial literacy also affects the type of mortgage and leverage position of younger households. Young homeowners with poorer financial literacy take on larger mortgage debts and are more likely to use alternative mortgage products