What do New-Keynesian Phillips Curves imply for price level targeting?

This paper extends the analysis of price level targeting to a model including the New-Keynesian Phillips Curve. We examine the inflation-output variability tradeoffs implied by optimal inflation and price level rules. In previous work with the Neoclassical Phillips Curve, we found that the choice between inflation targeting and price level targeting depended on the amount of persistence in the output gap. That is, if the output gap was not too persistent, or if lagged output did not enter the aggregate supply function, then inflation targets were preferred to price level targets. When we start with a New Keynesian Phillips Curve, the amount of persistence in the output gap still affects the relative placement of the inflation-output variability tradeoff. But, contrary to the Neoclassical case, even where the persistence of the output gap in the aggregate supply function is small or nonexistent, the price level targeting regime still results in a more favorable tradeoff between output and inflation variability than does an inflation-targeting regime.Phillips curve ; Monetary policy ; Inflation (Finance)

Inflation-targeting, price-path targeting and indeterminacy

In this paper, we examine the areas of indeterminacy in a flexible price RBC model with shopping time role for money and a central bank that uses an interest rate rule to target inflation and/or the price level. We present analytical results showing that, although inflation targeting often results in real indeterminacy, a price level target generally delivers a unique equilibrium for a relevant range of policy parameters.Monetary policy ; Equilibrium (Economics)

What do New-Keynesian Phillips Curves imply for price-level targeting?

This paper extends the analysis of price-level targeting to a model including the New-Keynesian Phillips Curve. We examine the inflation-output variability tradeoffs implied by optimal inflation and price-level rules. In previous work with the Neoclassical Phillips Curve, we found that the choice between inflation targeting and price-level targeting depended on the amount of persistence in the output gap. That is, if the output gap was not too persistent, or if lagged output did not enter the aggregate supply function, then inflation targets were preferred to price-level targets. When we start with a New-Keynesian Phillips Curve, the amount of persistence in the output gap still affects the relative placement of the inflation-output variability tradeoff. But, contrary to the Neoclassical case, even where the persistence of the output gap in the aggregate supply function is small or nonexistent, the price-level- targeting regime still results in a more favorable tradeoff between output and inflation variability than does an inflation-targeting regime.Phillips curve ; Monetary policy ; Inflation (Finance)

Inflation persistence and flexible prices

If the central bank follows an interest rate rule, then inflation is likely to be persistence, even when prices are fully flexible. Any shock, whether persistent or not, may lead to inflation persistence. In equilibrium, the dynamics of inflation are determined by the evolution of the spread between the real interest rate and the central bank’s target. Inflation persistence in U.S. data can be characterized by a vector autocorrelation function relating inflation and deviations of output from trend. This paper shows that a flexible-price general equilibrium business cycle model with money and a central bank using an interest rate target can account for such inflation persistence.Inflation (Finance) ; Econometric models ; Taylor's rule

Gold, fiat money and price stability

The classical gold standard has long been associated with long-run price stability. But short-run price variability led critics of the gold standard to propose reforms that look much like modern versions of price-path targeting. This paper uses a dynamic stochastic general equilibrium model to examine price dynamics under alternative policy regimes. In the model, an inflation target provides more short-run price stability than does the gold standard and, although it introduces a unit root into the price level, it leads to as much long-term price stability as does the gold standard for horizons shorter than 30 years. Relative to these regimes, Fisher's compensated dollar reduces price level and inflation uncertainty by an order of magnitude at all horizons.> The classical gold standard has long been associated with long-run price stability. But short-run price variability led critics of the gold standard to propose reforms that look much like modern versions of price-path targeting. This paper uses a dynamic stochastic general equilibrium model to examine price dynamics under alternative policy regimes. In the model, an inflation target provides more short-run price stability than does the gold standard and, although it introduces a unit root into the price level, it leads to as much long-term price stability as does the gold standard for horizons shorter than 30 years. Relative to these regimes, Fisher's compensated dollar reduces price level and inflation uncertainty by an order of magnitude at all horizons.Inflation (Finance) ; Monetary policy ; Gold standard

Gold, Fiat Money, and Price Stability

Which monetary regime is associated with the most stable price level? A commodity money regime such as the classical gold standard has long been associated with long-run price stability. But critics of the day argued that the regime was associated with too much short-run price variability and argued for reforms that look much like modern versions of price-level targeting. In this paper, we develop a dynamic stochastic general equilibrium model that we use to examine price dynamics under four alternative regimes. They are the gold standard, Irving Fisher's compensated dollar proposal, and two regimes with paper money in which the central bank uses an interest rate rule to run monetary policy. In the first, the central bank uses an interest rate rule to target the price of gold. In the second, there is no convertibility and the central bank targets uses an interest rate rule to target an inflation rate. We find that strict inflation targeting, even though it introduces a unit root into the price level, provides more short-run stability than the gold standard and as much long-term price stability as does the gold standard for horizons shorter than 30 years. We find that Fisher's compensated dollar reduces price level and inflation uncertainty by an order of magnitude at all horizons.

Photo-lability of deep ocean dissolved black carbon

Dissolved black carbon (DBC), defined here as condensed aromatics isolated from seawater via PPL solid phase extraction and quantified as benzenepolycarboxylic acid (BPCA) oxidation products, is a significant component of the oceanic dissolved organic carbon (DOC) pool. These condensed aromatics are widely distributed in the open ocean and appear to be tens of thousands of years old. As such DBC is regarded as highly refractory. In the current study, the photo-lability of DBC, DOC and coloured dissolved organic matter (CDOM; ultraviolet-visible absorbance) were determined over the course of a 28 day irradiation of North Atlantic Deep Water under a solar simulator. During the irradiation DBC fell from 1044 ± 164 nM-C to 55 ± 15 nM-C, a 20-fold decrease in concentration. Dissolved black carbon photo-degradation was more rapid and more extensive than for bulk CDOM and DOC. The concentration of DBC correlated with CDOM absorbance and the quality of DBC indicated by the ratios of different BPCAs correlated with CDOM absorbance spectral slope, suggesting the optical properties of CDOM may provide a proxy for both DBC concentrations and quality in natural waters. Further, the photo-lability of components of the DBC pool increased with their degree of aromatic condensation. These trends indicate that a continuum of compounds of varying photo-lability exists within the marine DOC pool. In this continuum, photo-lability scales with aromatic character, specifically the degree of condensation. Scaling the rapid photo-degradation of DBC to rates of DOC photo-mineralisation for the global ocean leads to an estimated photo-chemical half-life for oceanic DBC of less than 800 years. This is more than an order of magnitude shorter than the apparent age of DBC in the ocean. Consequently, photo-degradation is posited as the primary sink for oceanic DBC and the apparent survival of DBC molecules in the oceans for millennia appears to be facilitated not by their inherent inertness but by the rate at which they are cycled through the surface ocean's photic zone

Fe- and Cu-complex formation with artificial ligands investigated by ultra-high resolution Fourier-transform ion cyclotron resonance mass spectrometry (FT-ICR-MS): Implications for natural metal-organic complex studies

In recent years, electrospray-ionization mass spectrometry (ESI-MS) has been increasingly used to complement the bulk determination of metal-ligand equilibria, for example via competitive ligand exchange-adsorptive cathodic stripping voltammetry (CLE-ACSV). However, ESI-MS speciation analyses may be impacted by instrumental artifacts such as reduction reactions, fragmentation, and adduct formation at the ESI source, changes in the ionization efficiencies of the detected species in relation to sample matrix, and peak overlaps in response to increasing sample complexity. In our study, equilibria of the known artificial ligands citrate, ethylenediaminetetraacetic acid (EDTA), 1-nitroso-2-naphthol (NN), and salicylaldoxime (SA) with iron (Fe) and copper (Cu) were investigated by ultra-high resolution ESI-MS, Fourier-transform ion cyclotron resonance mass spectrometry (FT-ICR-MS), under a variety of sample matrix and ionization settings. The acquired mass spectra were compared with metal-ligand equilibrium data from the literature as well as an adapted speciation model. Overall, the mass spectra produced representative species mentioned in previous reports and predicted by the speciation calculations, such as Fe(Cit), Cu(Cit)2, Fe(EDTA), Cu(EDTA), Fe(NN)3, and Cu(SA)2. The analyses furthermore revealed new species which had been hypothesized but not measured directly using other methods, for example ternary complexes of citrate with Fe and Cu, Cu(SA) monomers, and the dimer Fe(SA)2. Finally, parallel measurements of a Cu+SA calibration series and a Cu+SA+EDTA competition series indicated that FT-ICR-MS can produce linear responses and low detection limits analogous to those of ACSV. We propose that ultra-high resolution FT-ICR-MS can be used as a representative tool to study interactions of trace metals with artificial as well as natural, unknown ligands at the molecular level

Towards a Precise Parton Luminosity Determination at the CERN LHC

A new approach to determine the LHC luminosity is investigated. Instead of employing the proton-proton luminosity measurement, we suggest to measure directly the parton-parton luminosity. It is shown that the electron and muon pseudorapidity distributions, originating from the decay of W+, W- and Z0 bosons produced at 14 TeV pp collisions (LHC), constrain the x distributions of sea and valence quarks and antiquarks in the range from about 3 x 10**-4 to about 10**-1 at a Q**2 of about 10**4 GeV**2. Furthermore, it is demonstrated that, once the quark and antiquark structure functions are constrained from the W+,W- and Z0 production dynamics, other quark-antiquark related scattering processes at the LHC like q-qbar --> W+W- can be predicted accurately. Thus, the lepton pseudorapidity distributions provide the key to a precise parton luminosity monitor at the LHC, with accuracies of about +-1% compared to the so far considered goal of +-5%.Comment: plain tex, 14 pages, 5 figure

Human TRIM5α mediated restriction of different HIV-1 subtypes and Lv2 sensitive and insensitive HIV-2 variants

In order to characterize the antiviral activity of human TRIM5α in more detail human derived indicator cell lines over expressing wild type human TRIM5α were generated and challenged with HIV-1 and HIV-2 viruses pseudotyped with HIV envelope proteins in comparison to VSV-G pseudotyped particles. HIV envelope protein pseudotyped particles (HIV-1[NL4.3], HIV-1[BaL]) showed a similar restriction to infection (12 fold inhibition) compared to VSV-G pseudotyped viruses after challenging TZM-huTRIM5α cells. For HIV-2 a stronger restriction to infection was observed when the homologous envelope protein Env42S was pseudotyped onto these particles compared to VSV-G pseudotyped HIV-2 particles (8.6 fold inhibition versus 3.4 fold inhibition). It has been shown that HIV-2 is restricted by the restriction factor Lv2, acting on capsid like TRIM5α. A mutation of amino acid 73 (I73V) of HIV-2 capsid renders this virus Lv2-insensitive. Lv2-insensitive VSV-G pseudotyped HIV-2/I73V particles showed a similar restriction to infection as did HIV-2[VSV-G] particles (4 fold inhibition). HIV-2 envelope protein (Env42S)-pseudotyped HIV-2/I73V particles revealed a 9.3 fold increase in infection in TZM cells but remained restricted in TZM-huTRIM5α cells (80.6 fold inhibition) clearly indicating that at least two restriction factors, TRIM5α and Lv2, act on incoming HIV-2 particles. Further challenge experiments using primary isolates from different HIV-1 subtypes and from HIV-1 group O showed that wild type human TRIM5α restricted infection independent of coreceptor use of the infecting particle but to variable degrees (between 1.2 and 19.6 fold restriction)