Statistical Nonlinearities in the Business Cycle

Nonlinear, Real Business Cycles, Efficient Method of Moments

Financial Choice in a Non-Ricardian Model of Trade

We join the new trade theory with a model of choice between bank and bond financing to show the differential effects of financial policy on the distribution of firm size, welfare, aggregate output, gains from trade, and the real exchange rate in a small open economy. Increasing bank efficiency and reducing bond transaction costs both increase welfare but have opposite effects on the extensive margin of trade, aggregate exports, and the real exchange rate. Increasing the degree of trade openness increases firms’ relative demand for bond versus bank financing. We identify a financial switching channel for gains from trade where increasing access to export markets allows firms to overcome high fixed costs of bond issuance to secure a lower marginal cost of capital.heterogeneity, bank, bond, firm finance, export real exchange rate

Financial choice in a non-Ricardian model of trade

We join the new trade theory with a model of choice between bank and bond financing to show the differential effects of financial policy on the distribution of firm size, welfare, aggregate output, gains from trade, and the real exchange rate in a small open economy. Increasing bank efficiency and reducing bond transaction costs both increase welfare but have opposite effects on the extensive margin of trade, aggregate exports, and the real exchange rate. Increasing the degree of trade openness increases firms' relative demand for bond versus bank financing. We identify a financial switching channel for gains from trade where increasing access to export markets allows firms to overcome high fixed costs of bond issuance to secure a lower marginal cost of capital.Trade ; Bank loans ; Bond market

The composition of capital inflows when emerging market firms face financing constraints

The composition of capital inflows to emerging market economies tends to follow a predictable dynamic pattern across the business cycle. In most emerging market economies, total inflows are procyclical, with debt and portfolio equity flowing in first, followed later in the expansion by foreign direct investment (FDI). To understand the timing of these flows, we use a small open economy (SOE) framework to model the composition of capital inflows as the equilibrium outcome of emerging market firms' financing decisions. We show how costly external financing and foreign direct investment search costs generate a state contingent cost of financing, so that the "cheapest" source of financing depends on the phase of the business cycle. In this manner, the financial frictions are able to explain the interaction between the types of flows and deliver a time varying composition of flows, as well as other standard features of emerging market business cycles. If, as this work suggests, flows are an equilibrium outcome of firms' financing decisions then volatility of capital inflows is not necessarily "bad" for an economy. Furthermore, using capital controls to shut down one type of flow and encourage another is certain to have both long- and short-run welfare implications.Capital movements ; Emerging markets

A Theory of Banks, Bonds, and the Distribution of Firm Size

Does targeted financial development favor small firms or large ones? And how do resulting changes in the distribution of firm size affect aggregate outcomes? We assess the macroeconomic implications of known stylized facts from the finance literature regarding firm size and financial frictions for the real economy. In an era of intense policy debate over the role of market-based finance in the macroeconomy, we find that considering the entire distribution of firm size is key to accurately assess the effects of targeted financial policies on macroeconomic outcomes and firm behavior.heterogeneity, bank, bond, distribution of firm size

A theory of banks, bonds, and the distribution of firm size

We draw on stylized facts from the finance literature to build a model where altering the relative costs of bank and bond financing changes the entire distribution of firm size, with implications for the aggregate capital stock, output, and welfare. Reducing transactions costs in the bond market increases the output and profits of mid-sized firms at the expense of both the largest and smallest firms. In contrast, reducing the frictions involved in bank lending promotes the expansion of the smallest firms while all other firms shrink, even as it increases the profitability of both small and mid-size firms. Although both policies increase aggregate output and welfare, they have opposite effects on the extensive margin of production-promoting bond issuance causes exit while cheaper bank credit induces entry. When reducing transactions costs in one market, the resulting increase in output and welfare are largest when transactions costs in the other market are very high.Bond market ; Bank loans

Evaluación ergonómica del procesamiento del caucho natural en plantaciones y pequeñas empresas

(Eng) This exploratory study used OWAS (Ovako Working Posture Analysing System) to analyze the working postures of natural rubber tappers and rubber industry workers. A community of natural rubber farmers of Tarazá and five small companies of Medellín and Itagüí, all of them allocated in Antioquia-Colombia, participated in this study. Processes were analyzed in-situ and videotapes of activities were recorded for carrying out a movement study. For an overall distribution of trunk postures, OWAS identified that a bent and twisted trunk posture which fell into action category 4, was the major poor posture for rubber tappers and rubber industry workers. This study also identified that latex tapping, latex collection, mixing in two roll mills and metallic molds operation were the four activities in which the major working posture risks were observed. It was found that reduction of posture risks in natural rubber production chain requires designing and implementing plans considering organizational culture, socio-economic and sociodemographic factors of natural rubber farmers and small rubber manufacturing industries, besides the use of some useful tools that reduce the handling of heavy loads(Spa) Este trabajo presenta un estudio exploratorio que usa la metodología OWAS (Ovako Working Posture Analysing System, por sus siglas en inglés) para analizar las posturas de heveicultores y operarios de la industria del caucho durante sus actividades laborales. El estudio se realizó en pequeñas plantaciones de una asociación de cultivadores de caucho en Tarazá, y en cinco pequeñas empresas de Medellín e Itagüí, en Antioquia-Colombia. Se analizaron los procesos in-situ, tomando registros mediante videos para posteriormente efectuar un análisis de los movimientos. Se encontró que los mayores riesgos ergonómicos para los heveicultores y los operarios de pequeñas y medianas industrias de caucho son la generación de trastornos musculoesqueléticos (TME) en la columna vertebral y la Back, con un nivel de riesgo 4. Se encontró también que el sangrado de los árboles, la recolección del látex, el mezclado en molino abierto de rodillos y la manipulación de moldes fueron las cuatro actividades en las cuales se presentan los principales riesgos de postura. Al final del trabajo se proponen recomendaciones para evaluar y reducir los riesgos de postura en pequeñas empresas de la cadena productiva del caucho natural. Se identificó que la reducción de los riesgos de postura in la cadena productiva del caucho natural requiere diseñar e implementar planes que consideren la cultura organizacional y factores socioeconómicos y sociodemográficos de los cultivadores de caucho natural y pequeñas industrias fabricantes de artículos en caucho, además de la utilización de algunas herramientas que reducen la manipulación de cargas pesadas

A Theory of Banks, Bonds, and the Distribution of Firm Size

We draw on stylized facts from the finance literature to build a model where altering the relative costs of bank and bond financing changes the entire distribution of firm size, with implications for the aggregate capital stock, output, and welfare. Reducing transactions costs in the bond market increases the output and profits of mid-sized firms at the expense of both the largest and smallest firms. In contrast, reducing the frictions involved in bank lending promotes the expansion of the smallest firms while all other firms shrink, even as it increases the profitability of both small and mid-size firms. Although both policies increase aggregate output and welfare, they have opposite effects on the extensive margin of production---promoting bond issuance causes exit while cheaper bank credit induces entry. When reducing transactions costs in one market, the resulting increase in output and welfare are largest when transactions costs in the other market are very high.

Financial Choice in a Non-Ricardian Model of Trade

We join the new trade theory with a model of choice between bank and bond financing to show the differential effects of financial policy on the distribution of firm size, welfare, aggregate output, gains from trade, and the real exchange rate in a small open economy. Increasing bank efficiency and reducing bond transaction costs both increase welfare but have opposite effects on the extensive margin of trade, aggregate exports, and the real exchange rate. Increasing the degree of trade openness increases firms' relative demand for bond versus bank financing. We identify a financial switching channel for gains from trade where increasing access to export markets allows firms to overcome high fixed costs of bond issuance to secure a lower marginal cost of capital.

Social and Economic Dimensions of Seaweed Farming: A Global Review

Seaweed farming based primarily on the culture of Kappaphycus and Eucheuma species has grown significantly in the Philippines and Indonesia over the last two decades, with growth also taking place at a smaller scale in Tanzania, India and a few other developing countries. Unlike other forms of aquaculture, seaweed farming foregoes the use of feed and fertilizers and has minimum technological and capital requirements. In addition, growout cycles are short, normally lasting less than two months. Given these unique characteristics, seaweed farming has generated substantial socio-economic benefits to marginalized coastal communities in developing countries, most of which have reduced access to alternative economic activities. In some communities, seaweed farming has emerged as the most relevant livelihood strategy. This paper summarizes the findings of a recent FAO review on the social and economic dimensions of seaweed farming in six countries in Asia (the Philippines, Indonesia, India), Africa (Tanzania), Oceania (Solomon Islands), and Latin America (Mexico). Each case study documented the evolution of the farming sector and examined the mix of public sector policies and private sector involvement leading to growth of the activity. Given the rising global demand for seaweed-derived products, seaweed farming has the potential to generate further socio-economic benefits to coastal communities in tropical regions; however, a number of challenges and constraints (some of which are country-specific) will need to be addressed to fully take advantage of these opportunities