Matter fields from a decaying background Lambda vacuum

We suggest an alternative framework for interpreting the current state of the visible universe. Our approach is based on a dynamical ``Cosmological Constant'' and the starting point is that a decaying vacuum produces matter. As we point out, such a dynamical Lambda is not incompatible with the general requirements of general relativity. By assuming inflation and big bang nucleosynthesis we can solve for the present fractional densities of matter Omega_{m,0} and vacuum Omega_{Lambda, 0} in terms of only one parameter which we call the vacuum domination crossing redshift, z_c. We put constraints on z_c to obtain a universe that is presently vacuum dominated and with characteristic densities consistent with observations. The model points to the possible existence of newly formed dark matter in the inter-cluster voids. We argue that some of this matter could be accreting onto clusters through the latter's long range gravitational potentials. If so, then cluster dark matter halos may not manifest clear cut-offs in their radial density profiles. Furthermore, if a substantial amount of this newly produced matter has already drained onto the clusters, then the CMB power spectrum may favor lower dark matter density values than is currently observed bound in the clusters. A final feature of our approach relates to the combined effect of the matter production by a decaying vacuum and the different rates at which matter and the vacuum will dilute with the scale factor. Such combination may create conditions for a universe in which the vacuum and matter densities dilute and evolve towards comparable amplitudes. In this sense the model offers a natural and conceptually simple explanation to the Coincidence Problem.Comment: 22 pages, 1 figure, accepted for publication in Int. J. Mod. Phys. Lett.

Constraints On Cosmic Dynamics

Observationally, the universe appears virtually critical. Yet, there is no simple explanation for this state. In this article we advance and explore the premise that the dynamics of the universe always seeks equilibrium conditions. Vacuum-induced cosmic accelerations lead to creation of matter-energy modes at the expense of vacuum energy. Because they gravitate, such modes constitute inertia against cosmic acceleration. On the other extreme, the would-be ultimate phase of local gravitational collapse is checked by a phase transition in the collapsing matter fields leading to a de Sitter-like fluid deep inside the black hole horizon, and at the expense of the collapsing matter fields. As a result, the universe succumbs to neither vacuum-induced run-away accelerations nor to gravitationally induced spacetime curvature singularities. Cosmic dynamics is self-regulating. We discuss the physical basis for these constraints and the implications, pointing out how the framework relates and helps resolve standing puzzles such as "why did cosmic inflation end?", "why is Lambda small now?" and "why does the universe appear persistently critical?". The approach does, on the one hand, suggest a future course for cosmic dynamics, while on the other hand it provides some insight into the physics inside black hole horizons. The interplay between the background vacuum and matter fields suggests an underlying symmetry that links spacetime acceleration with spacetime collapse and global (cosmic) dynamics with local (black hole) dynamics.Comment: 11 page

Deficit Limits, Budget Rules and Fiscal Policy

The paper presents a simple model for discussing the effects of deficit limits and budget rules on fiscal policy. I find that limits on deficit- output ratios provide incentives to implement procyclical policies when the economy is in intermediate states, and countercyclical policies only in very “good” and very “bad” economic times. As a result, fiscal “reaction functions” are not monotonically related to the state of the economy. Deficit limits are found to exert discipline only provided the limit is tight and the expected sanction large, albeit at a relatively large welfare cost. Moreover, when fiscal choices are made under a veil of ignorance about the output gap, an increase in volatility is likely to raise the level of the budget deficit. Finally, concerning the design of fiscal frameworks, when excessive deficits arise from a political bias, deficit limits should be symmetric and not state-contingent.Fiscal Rules, SGP, Pro-cyclical Fiscal Policy

Trade, Wages and ´Superstars’

We study the effect “globalization” on wage inequality. Our “global” economy resembles Rosen (1981) “Superstars” economy, where a) innovations in production and communication technologies enable suppliers to reach a larger mass of consumers and to improve the (perceived) quality of their products and b) trade barriers fall. When transport cost fall, income is redistributed away from the non-exporting to the exporting sector of the economy. As the latter turns out to employ workers of higher skill and pay, the effect is to raise wage inequality. Whether the least skilled are stand to lose or gain from improved production or communication technologies, in contrast, depends on whether technology is skill-complement or substitute. The model provides an intuitive explanation for why changes in wage premia are so strongly affected by export’ growth in plant-level empirical investigations (Bernard and Jensen (1997)).International trade, wage inequality, technological change

'Rules of Thumb' for Sovereign Debt Crises

Sovereign Default, Debt Crises

Can gravitational collapse sustain singularity-free trapped surfaces?

In singularity generating spacetimes both the out-going and in-going expansions of null geodesic congruences $\theta ^{+}$ and $\theta ^{-}$ should become increasingly negative without bound, inside the horizon. This behavior leads to geodetic incompleteness which in turn predicts the existence of a singularity. In this work we inquire on whether, in gravitational collapse, spacetime can sustain singularity-free trapped surfaces, in the sense that such a spacetime remains geodetically complete. As a test case, we consider a well known solution of the Einstien Field Equations which is Schwarzschild-like at large distances and consists of a fluid with a $p=-\rho$ equation of state near $r=0$. By following both the expansion parameters $\theta ^{+}$ and $\theta ^{-}$ across the horizon and into the black hole we find that both $\theta ^{+}$ and $\theta ^{+}\theta ^{-}$ have turning points inside the trapped region. Further, we find that deep inside the black hole there is a region $0\leq r<r_{0}$ (that includes the black hole center) which is not trapped. Thus the trapped region is bounded both from outside and inside. The spacetime is geodetically complete, a result which violates a condition for singularity formation. It is inferred that in general if gravitational collapse were to proceed with a $p=-\rho$ fluid formation, the resulting black hole may be singularity-free.Comment: 17 pages, 3 figures, accepted for publication in International Journal of Modern Physics