The law of one price and the role of market structure

This paper examines the role of market structure on the persistence of price deviations from the LOP using monthly actual product prices of 47 items collected from three different types of markets in Istanbul over 1993:01-2008:12. After showing the importance of market structure on the distribution of relative prices, we implement threshold autoregressive models. We find significant differences in average threshold estimates across markets which we explain referring to differing menu costs in each market. Yet, we find no differences in average half-life estimates across markets. We argue that this is due to low search costs in Istanbul. Robustness checks verify our findings

Nonlinear impact of inflation on relative price variability

Using a half-a-century long disaggregated price data for 22 food products collected from 19 cities, we show that the association between inflation and price variability is nonlinear with respect to changes in inflation rate. We obtain similar results for expected and unexpected inflation

Reexamining the linkages between inflation and output growth: A bivariate ARFIMA-FIGARCH approach

In this paper, given recent theoretical developments that inflation can exhibit long memory properties due to the output growth process, we propose a new class of bivariate processes to simultaneously investigate the dual long memory properties in the mean and the conditional variance of inflation and output growth series. We estimate the model using monthly UK data and document the presence of dual long memory properties in both series. Then, using the conditional variances generated from our bivariate model, we employ Granger causality tests to scrutinize the linkages between the means and the volatilities of inflation and output growth.

CADAVERIC VS. LIVE-DONOR KIDNEY TRANSPLANTS: THE INTERACTION OF INSTITUTIONS AND INEQUALITY

“In 1991, the World Health Assembly approved a set of Guiding Principles which emphasize voluntary donation, non-commercialization and a preference for cadavers over living donors” (World Health Organization). We investigate whether factors such as inequality, rule of law and religion have any effect on the ratio of cadaveric transplants to all transplants. Using an unbalanced annual dataset from 64 countries over 1993-2004, we show particularly for developing countries that an improvement in equality and rule of law encourage cadaveric kidney transplants. Religion also plays an important role in that relationship.

The response of firms' leverage to uncertainty: Evidence from UK public versus non-public firms

This paper empirically investigates the effects of uncertainty on firms' leverage. The analysis is carried out for a large panel of public and non-public UK manufacturing firms over 1999-2008. The empirical results provide evidence that firms use less short-term debt as they go through periods of high uncertainty. The leverage of non-public firms is more sensitive to idiosyncratic uncertainty in comparison to their public counterparts, yet macroeconomic uncertainty affects both types of frms similarly. We fnally end our investigation showing that the total impact of either type of uncertainty on firms' leverage is related to the amount of the cash buer each firm carries.

Cadaveric vs. Live-Donor Kidney Transplants: The Interaction of Institutions and Inequality

In 1991, the World Health Assembly approved a set of Guiding Principles which emphasize voluntary donation, non-commercialization and a preference for cadavers over living donors” (World Health Organization). We investigate whether factors such as inequality, rule of law and religion have any effect on the ratio of cadaveric transplants to all transplants. Using an unbalanced annual dataset from 64 countries over 1993-2004, we show particularly for developing countries that an improvement in equality and rule of law encourage cadaveric kidney transplants. Religion also plays an important role in that relationship.Cadaveric and live-donor kidney transplants, rule of law, religious beliefs, inequality

Effects of Exchange Rate Volatility on the Volume and Volatility of Bilateral Exports

We present an empirical investigation of a recently suggested but untested proposition that exchange rate volatility can have an impact on both the volume and variability of trade flows, considering a broad set of countries' bilateral real trade flows over the period 1980-1998. We generate proxies for the volatility of real trade flows and real exchange rates after carefully scrutinizing these variables' time series properties. Similar to the findings of earlier theoretical and empirical research, our first set of results show that the impact of exchange rate uncertainty on trade flows is indeterminate. Our second set of results provide new and novel findings that exchange rate volatility has a consistent positive and significant effect on the volatility of bilateral trade flows.exchange rates, volatility, fractional integration, trade flows

Inventories and sales uncertainty

We investigate the empirical linkages between sales uncertainty and firms' inventory investment behavior while controlling for firms' financial strength. Using large panels of manufacturing firms from several European countries we find that higher sales uncertainty leads to larger stocks of inventories. We also identify an indirect effect of sales uncertainty on inventory accumulation through the financial strength of firms. Our results provide evidence that financial strength mitigates the adverse effects of uncertainty.inventory investment, uncertainty, financial constraints

Real effects of inflation uncertainty in the US

We empirically investigate the effects of inflation uncertainty on output growth for the US using both monthly and quarterly data over 1985-2009. Employing a Markov regime switching approach to model output dynamics, we show that inflation uncertainty obtained from a Markov regime switching GARCH model exerts a negative and regime dependant impact on output growth. In particular, we show that the negative impact of inflation uncertainty on output growth is almost 4.5 times higher during the low growth regime than that during the high growth regime. We verify the robustness of our findings using quarterly dataGrowth, inflation uncertainty, Markov-switching modeling, Markov-switching GARCH

The Effect of the Exchange Rates on Investment in Mexican Manufacturing Industry

This paper, considering revenue and cost exposure channels, investigates the effects of exchange rate behaviour on fixed capital investment in Mexican manufacturing sector over 1994-2002. We find that i) currency depreciation has a positive (negative) effect on fixed investment through the export (import) channel; ii) exchange rate volatility impacts mostly export oriented sectors ; iii) the sensitivity of investment to exchange rate movements is stronger in non-durable goods sectors and industries with low mark-up ratios.Exchange rate volatility ; investment ; external exposure ; market structure