Consumption and saving behaviour: modelling recent trends

This paper illustrates recent trends in household consumption and personal savings in the UK and the US and discusses some theoretical models that can be used to interpret them. The trends in these two countries are interesting for several reasons. The decline in personal saving rates in the US during the 1980s is an unresolved puzzle. The corresponding variable in the UK has undergone large fluctuations, as have several other variables ranging from projected demographic trends to female labour supply. This paper stresses the need to analyse individual data to shed some light on these aggregate trends. It also stresses the need to have a sound structural model to interpret observed patterns in the data. The theoretical framework discussed throughout the paper is the life-cycle model, which views consumption and saving decisions as part of a dynamic optimisation process. The development of the model and the current research agenda and ways that it can be enriched with various degrees of sophistication are discussed. Particular attention is devoted to the discussion of the most recent developments.

The appraisal of buildable land for property taxation in the adopted general municipal plan

In Italy, tax base for "Imposta Municipale Unica" related to the building area -made such by General Plan or its General Variation adopted but not approved - is the value (of the same building area) depending on the building potential of prediction even if not immediately exercisable. However, the building rights can be exercised only after: (i) the final approval of the General Plan/General Variation; (ii) the approval of the Implementation Plan required by Law; (iii) the issuance of certificates of permission building. This has produced in recent years several disputes between owners and local governments; the law did not give univocal solutions: today (2015) there is a conflict of case law relating to consider this areas absolutely as building areas, as well as it isn't defined what estimating procedures should be used. In this paper, through the application of a model of financial mathematics, an approach that overcomes the conflict law related to the appraisal of the building areas included inGeneral Plans/General Variation adopted but not yet approved, is proposed: the appraisal will be performed in relation to the time and variables between the time of the appraisal and the time (alleged) for the completion of the administrative procedure for obtaining authorizations to build

Quantum Impurity Models coupled to Markovian and Non Markovian Baths

We develop a method to study quantum impurity models, small interacting quantum systems linearly coupled to an environment, in presence of an additional Markovian quantum bath, with a generic non-linear coupling to the impurity. We aim at computing the evolution operator of the reduced density matrix of the impurity, obtained after tracing out all the environmental degrees of freedom. First, we derive an exact real-time hybridization expansion for this quantity, which generalizes the result obtained in absence of the additional Markovian dissipation, and which could be amenable to stochastic sampling through diagrammatic Monte Carlo. Then, we obtain a Dyson equation for this quantity and we evaluate its self-energy with a resummation technique known as the Non-Crossing-Approximation. We apply this novel approach to a simple fermionic impurity coupled to a zero temperature fermionic bath and in presence of Markovian pump, losses and dephasing.Comment: Accepted for publication in the special issue on "Dynamics of Open Quantum Systems" of the AIP Journal of Chemical Physics (JCP

Nonparametric estimation of diffusion process: a closer look

A Monte Carlo simulation is performed to investigate the finite sample properties of a nonparametric estimator, based on discretely sampled observations of continuous-time Ito diffusion process. Chapman and Pearson (2000) studies finite-sample properties of the nonparametric estimator of Aýt-Sahalia (1996) and Stanton (1997) and they find that nonlinearity of the short rate drift is not a robust stylized fact but it’s an artifacts of the estimation procedure. This paper examine the finite sample properties of a different nonparametric estimator within the Stanton (1997)’s framework.ewp-mac/050417

Estimation of continuous-time interest rate models: a nonparametric approach

This paper presents a general, nonlinear model for term structure interest rate. The approach is the same of Stanton (1997) but it has been extended to a multifactor model. The novel aspect is that rather than choosing the functional specification of the model, the process is generated from the data using approximation methods for multifactor continuous-time Markov processes. In applying this technique to the short and long end of the term structure for a general two-factor diffusion process for interest rates is possible to find some interesting nonlinearity in the interest rate data that are not considered in almost all parametric specifications of term structure interest rate model of the financial literature.continuous-time models, nonparametric estimation, multi-factor interest rate model

Conditional cash transfers, women and the demand for food

We examine the effect of large cash transfers on the consumption of food by poor households in rural Mexico. The transfers represent 20% of household income on average, and yet, the budget share of food is unchanged following receipt of this money. This is an important puzzle to solve, particularly so in the context of a social welfare programme designed in part to improve nutrition of individuals in the poorest households. We estimate an Engel curve for food. We rule out price increases, changes in the quality of food consumed and homotheticity of preferences as explanations for this puzzle. We also show that food is a necessity, with a strong negative effect of income on the food budget share. The decrease in food budget share caused by the large increase in income is cancelled by some other relevant aspect of the programme so that the net effect is nil. We argue that the program has not changed preferences and that there is no labelling of money. We propose that the key to the puzzle resides in the fact that the transfer is put in the hands of women and that the change in control over household resources is what leads to the observed changes in behaviour.Demand, conditional cash transfer, Engel curves, income elasticities, QUAIDS, food, nutrition.

Oportunidades: Program Effect on Consumption, Low Participation, and Methodological Issues

In this paper we estimate the effect of the Mexican conditional cash transfer program, Oportunidades, on consumption, and we explore some issues related to participation to the program and to the estimation of treatment effects. We discuss the comparability of treatment and control areas, provide evidence that the expected transfer may not be sufficiently high to induce many eligible households to participate, and find positive effects on consumption.program evaluation, consumption, matching, Oportunidades