Coincident and Leading Indicators for the Euro Area: A Frequency Band Approach

In the context of a common monetary policy, tracking euro area economic developments becomes essential. The aim of this paper is to build monthly coincident and leading composite indicators for the euro area business cycle. However, instead of looking at the overall comovement between the variables as it is standard in the literature, we show how one can resort to both time and frequency domain analysis to achieve additional insight about their relationship. We find that, in general, the lead/lag properties of economic indicators depend on the cycles periodicity. Following a frequency band approach, we take advantage of this in the construction of the coincident and leading composite indicators. The resulting indicators are analysed and a comparison with other composite indicators proposed in the literature is made.

International comovement of stock market returns: a wavelet analysis

The assessment of the comovement among international stock markets is of key interest, for example, for the international portfolio diversification literature. In this paper, we re-examine such comovement by resorting to a novel approach, wavelet analysis. Wavelet analysis allows one to measure the comovement in the time-frequency space. In this way, one can characterize how international stock returns relate in the time and frequency domains simultaneously, which allows one to provide a richer analysis of the comovement. We focus on Germany, Japan, UK and US and the analysis is done at both the aggregate and sectoral levels.

Forecasting Euro Area Aggregates with Bayesian VAR and VECM Models

This paper focuses on Bayesian Vector Auto-Regressive (BVAR) models for the euro area. A modified hyperparameterization scheme based on the Minnesota prior that takes into account the economic nature of the variables in the model is used. The merits of incorporating long-run relationships are also discussed. Alternative methods to estimate eventual cointegrating relations in the variables are considered, and the problem of choice of appropriate prior distributions for BVAR with Error Correction Mechanism (BECM) models is addressed. Results show that using a flat prior on factor loadings can seriously endanger the forecasting performance of BECM models. Overall, the BVAR model in levels outperforms all other models across variables and forecasting horizons. This is in contrast with other empirical studies where some gains could be obtained when incorporating long-run relationships in the model.

Ranking schools: a step toward increased accountability or a mere discriminatory practice?

The purpose of this paper is to contribute to the discussion of the effects of published school rankings based on average scores obtained by students on national exams. We study the effectiveness of this (low-stakes) accountability mechanism; we analyze whether students react to these rankings, by moving in or out of high-schools according to their scores and examine the movements of closing of schools. Our results suggest that families react strongly to published rankings. We also look at the changes in the socio-economic background of students of poorly performing schools in order to evaluate whether the publication of rankings has increased inequality, as feared by many observers. According to our results, published rankings do in fact reinforce stratification by income.Fundação para a Ciência e Tecnologi

Exchange Market Pressure and the Credibility of Macau’s Currency Board

In this study, we assess the credibility of the currency board arrangement (CBA) of the Macau Special Administrative Region by studying the relationship between exchange market pressure (EMP) and the anchors of a rule-based CBA, namely, interest rate arbitrage, exchange rate arbitrage and economic discipline. A pure CBA signals its credibility by allowing the first two anchors to function automatically and by pursuing sound fiscal policies. The analysis’ results suggest that Macau’s CBA has been characterised by a state of low volatility since late 1992, with the brief exception of the East Asian financial crisis period. The paper’s main finding is that fiscal fundamentals seem to have a more pronounced role in reducing EMP’s variability during periods of low volatility whilst interest rate arbitrage is more important in periods of high volatility. We conclude that Macau’s CBA is credible at present as reflected in the low frequency of observed EMP, in the narrowing of Macau’s interest rate differential vis-à-vis U.S. interest rates and in Macau’s substantial fiscal reserves.N/

No country for young kids? The effects of school starting age throughout childhood and beyond

Being the youngest in a cohort entails many penalties. Using administrative data of every public-school student in Portugal, we show that although performance gains from being 1-year older fade quickly from primary education to high school, age-related penalties persist through a combination of grade retention, educational tracking and testing policies. Those that start school younger are more likely to repeat grades and ultimately drop out from school. Older entrants are more likely to enroll in scientific curricula in high school, are more successful at accessing public higher education and enroll in more selective undergraduate courses.info:eu-repo/semantics/publishedVersio

coursetaking choice and impact on dropout and college enrollment rates

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Does the age of entry in primary school affect student’s achievement?

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Academic performance and territorial patterns of students with an immigrant background in the Lisbon Metropolitan Area

This paper focuses on the territorial distribution of students with an immigrant background enrolled in the 3rd cycle of basic education in Portugal and on the differences in the academic performance of students enrolled in the last year of this cycle based on their birthplace and immigrant background when compared to their native peers in the Lisbon Metropolitan Area. These differences are examined by estimating several linear regression models using as dependent variable three performance indicators – student’s results in the 9th grade national exams in the Maths and Portuguese Language subjects, as well as a binary indicator of a successful academic record during the 3rd cycle. The observed results confirm the hypothesis that there are significant differences in the students’ academic performance depending on their immigrant background and birthplace: (i) 2nd-generation and 1st-generation students perform worse than Native students; (ii) students from Brazil and PALOP countries have the most significant differences compared to students from Portugal. We also identify that a substantial part of these differences is already present in the end of the 2nd cycle of basic education. Furthermore, our results indicate that a considerable part of the differences is explained by factors inherent to the school and the class of the student, and not so much to the municipality, which might indicate the existence of some type of segregation experienced by these students, either at intra-municipality level (by the different schools) or intra-school level (by the different classes).N/

Combining CV and RP Data: a Note on the Relationship Between Consistency and Rationality

In this paper, we show that, when combining revealed (RP) and stated (SP) data, for marginal changes in quality of environmental goods, rationality implies consistency, as the consistency conditions coincide with a subset of the conditions for rationality.N/