Hyperbolic Discounting and Positive Optimal Inflation

The Friedman rule states that steady-state welfare is maximized when there is deflation at the real rate of interest. Recent work by Khan et al (2003) uses a richer model but still finds deflation optimal. In an otherwise standard new Keynesian model we show that, if households have hyperbolic discounting, small positive rates of inflation can be optimal. In our baseline calibration, the optimal rate of inflation is 2.1% and remains positive across a wide range of calibrations.optimal monetary policy, inflation targeting, unemployment, Phillips curve, nominal inertia, monetary policy

Hyperbolic Discounting and Positive Optimal Inflation

The Friedman rule states that steady-state welfare is maximized when there is deflation at the real rate of interest. Recent work by Khan et al (2003) uses a richer model but still finds deflation optimal. In an otherwise standard new Keynesian model we show that, if households have hyperbolic discounting, small positive rates of inflation can be optimal. In our baseline calibration, the optimal rate of inflation is 2.1% and remains positive across a wide range of calibrations.optimal monetary policy, inflation targeting, unemployment, Phillips curve, nominal inertia, monetary policy

The real effects of money growth in dynamic general equilibrium

We analyse the effects of money growth within a standard New Keynesian framework and show that the interaction between staggered nominal contracts and money growth leads to a long-run trade-off between output and money growth. We explore the microeconomic mechanisms that lead to this trade-off, and show that it remains even when the contract length is endogenised. JEL Classification: E20, E40, E50inflation, nominal inertia, Phillips curve, Unemployment

Hyperbolic Discounting and the Phillips Curve

Using a standard dynamic general equilibrium model, we show that the interaction of staggered nominal contracts with hyperbolic discounting leads to inflation having significant long-run effects on real variables.inflation, unemployment, Phillips curve, nominal inertia, monetary policy, dynamic general equilibrium

XMDS2: Fast, scalable simulation of coupled stochastic partial differential equations

XMDS2 is a cross-platform, GPL-licensed, open source package for numerically integrating initial value problems that range from a single ordinary differential equation up to systems of coupled stochastic partial differential equations. The equations are described in a high-level XML-based script, and the package generates low-level optionally parallelised C++ code for the efficient solution of those equations. It combines the advantages of high-level simulations, namely fast and low-error development, with the speed, portability and scalability of hand-written code. XMDS2 is a complete redesign of the XMDS package, and features support for a much wider problem space while also producing faster code.Comment: 9 pages, 5 figure

Comparison of methods for numerical calculation of continuum damping

Continuum resonance damping is an important factor in determining the stability of certain global modes in fusion plasmas. A number of analytic and numerical approaches have been developed to compute this damping, particularly in the case of the toroidicity-induced shear Alfv\'en eigenmode. This paper compares results obtained using an analytical perturbative approach with those found using resistive and complex contour numerical approaches. It is found that the perturbative method does not provide accurate agreement with reliable numerical methods for the range of parameters examined. This discrepancy exists even in the limit where damping approaches zero. When the perturbative technique is implemented using a standard finite element method, the damping estimate fails to converge with radial grid resolution. The finite elements used cannot accurately represent the eigenmode in the region of the continuum resonance, regardless of the number of radial grid points used.Comment: 19 pages, 9 figure

UK Regional Connectivity on the North Atlantic: Hub-Bypassing or just changing hubs?

London Heathrow Airport (LHR) has maintained its position as the main gateway for UK passengers for international services, but has no services to many UK regional airports. This research examines whether UK regional airports have increased direct services to North Atlantic destinations or to other European hub airports in response to the lack of air services to the London area. The study analysed the changing dynamics of the UK aviation network from 1997 to 2017 as it pertains to hub connectivity and North Atlantic services. Both the number of connections from regional airports and the quality of those connections, measured in terms of the frequency of direct air services, have been examined. As most LCC passengers do not connect to other flights, only flights by full service carriers to both London and selected European hubs were considered. The data indicate that regional airport connectivity development has been heterogeneous. Whilst the number of UK regional airports with service to LHR has remained stable, the frequency of service has decreased noticeably. The larger and more geographically distant regional airports of Edinburgh, Glasgow, and Manchester have been able to develop more connections to both European hub airports and to North American cities, and in many cases have seen an increase in frequencies as well. Birmingham Airport, although of similar size to the above-mentioned airports, has on the contrast experienced a reduction in its connections to North American airports and of frequency to the European hub airports examined. Smaller UK regional airports have also seen a reduction in frequencies to European airports

Low cost carriers and the changing fortunes of airports in the UK

This paper investigates how low cost carrier (LCC) developments have affected the traffic and financial performance of UK airports from 2002 to 2014. Considerable growth in traffic was experienced from 2002 to 2007, especially at regional airports as a result of LCC expansion. This was replaced with a more volatile period from 2008 to 2014 where many of the regional airports that experienced the greatest increases in traffic during the early years, then experienced the largest reductions. This has clearly had an impact on their financial well-being, resulting in reduced profits for many airports. It has also meant that many regional airports that seemed like attractive investments as a result of LCC expansion are now less financially appealing, especially given that the LCC sector in the UK appears to be shifting capacity to larger regional airports, and in some cases, London airports