Euclid: Forecasts from redshift-space distortions and the Alcock-Paczynski test with cosmic voids

Euclid is poised to survey galaxies across a cosmological volume of unprecedented size, providing observations of more than a billion objects distributed over a third of the full sky. Approximately 20 million of these galaxies will have their spectroscopy available, allowing us to map the three-dimensional large-scale structure of the Universe in great detail. This paper investigates prospects for the detection of cosmic voids therein and the unique benefit they provide for cosmological studies. In particular, we study the imprints of dynamic (redshift-space) and geometric (Alcock-Paczynski) distortions of average void shapes and their constraining power on the growth of structure and cosmological distance ratios. To this end, we made use of the Flagship mock catalog, a state-of-the-art simulation of the data expected to be observed with Euclid. We arranged the data into four adjacent redshift bins, each of which contains about 11000 voids and we estimated the stacked void-galaxy cross-correlation function in every bin. Fitting a linear-theory model to the data, we obtained constraints on f/b and DMH, where f is the linear growth rate of density fluctuations, b the galaxy bias, D-M the comoving angular diameter distance, and H the Hubble rate. In addition, we marginalized over two nuisance parameters included in our model to account for unknown systematic effects in the analysis. With this approach, Euclid will be able to reach a relative precision of about 4% on measurements of f/b and 0.5% on DMH in each redshift bin. Better modeling or calibration of the nuisance parameters may further increase this precision to 1% and 0.4%, respectively. Our results show that the exploitation of cosmic voids in Euclid will provide competitive constraints on cosmology even as a stand-alone probe. For example, the equation-of-state parameter, w, for dark energy will be measured with a precision of about 10%, consistent with previous more approximate forecasts

Cross-Section Dependence and the Monetary Exchange Rate Model: A Panel Analysis

This paper tackles the issue of cross-section dependence for the monetary exchange rate model in the presence of unobserved common factors using panel data from 1973 until 2007 for 19 OECD countries. Applying a principal component analysis we distinguish between common factors and idiosyncratic components and determine whether non-stationarity stems from international or national stochastic trends. We find evidence for a cross-section cointegration relationship between the exchange rates and fundamentals which is driven by those common international trends. In addition, the estimated coefficients of income and money are in line with the suggestions of the monetary model

How Stable are Monetary Models of the Dollar-Euro Exchange Rate? A Time-Varying Coefficient Approach

This paper examines the significance of different fundamental regimes by applying various monetary models of the exchange rate to one of the politically most important exchange rates, the exchange rate of the US dollar vis-à-vis the euro (the DM). We use monthly data from 1975:01 to 2007:12. Applying a novel time-varying coefficient estimation approach, we come up with interesting properties of our empirical models. First, there is no stable long-run equilibrium relationship among fundamentals and exchange rates since the breakdown of BrettonWoods. Second, there are no recurring regimes, i.e. across different regimes either the coefficient values for the same fundamentals differ or the significance differs. Third, there is no regime in which no fundamentals enter. Fourth, the deviations resulting from the stepwise cointegrating relationship act as a significant error-correction mechanism. In other words, we are able to show that fundamentals play an important role in determining the exchange rate although their impact differs significantly across different subperiods

International Portfolio Flows and Exchange Rate Volatility for Emerging Markets

This paper investigates the effects of equity and bond portfolio inflows on exchange rate volatility, using monthly bilateral data for the US vis-a-vis eight Asian developing and emerging countries (India, Indonesia, South Korea, Pakistan, Hong Kong, Thailand, the Philippines, and Taiwan) over the period 1993:01-2012:11, and estimating a time-varying transition probability Markov-switching model. We find that net equity (bond) inflows drive the exchange rate to a high (low) volatility state. In particular, net bond inflows increase the probability of remaining in the low volatility state in the case of Pakistan, Thailand, and the Philippines, whilst they increase the probability of staying in the high volatility state in the case of Indonesia. Finally, net equity inflows from India, Indonesia, South Korea, Hong Kong, and Taiwan towards the US also increase the probability of staying in the high volatility state. These findings can be plausibly interpreted in terms of the "return-chasing" hypothesis and suggest that credit controls on portfolio flows could be an effective tool to stabilise the foreign exchange market

Revisiting the Gaia Hypothesis: Maximum Entropy, Kauffman’s ‘Fourth Law’ and Physiosemeiosis

Recently, Kleidon suggested to analyze Gaia as a non-equilibrium thermodynamic system that continuously moves away from equilibrium, driven by maximum entropy production which materializes in hierarchically coupled mechanisms of energetic flows via dissipation and physical work. I relate this view with Kauffman's 'Fourth Law of Thermodynamics', which I interprete as a proposition about the accumulation of information in evolutionary processes. The concept of physical work is expanded to including work directed at the capacity to work: I offer a twofold specification of Kauffman's concept of an 'autonomous agent', one as a 'self-referential heat engine', and the other in terms of physiosemeiosis, which is a naturalized application of Peirce's theory of signs. The conjunction of these three theoretical sources, Maximum Entropy, Kauffman's Fourth Law, and physiosemeiosis, shows that the Kleidon restatement of the Gaia hypothesis is equivalent to the proposition that the biosphere is generating, processing and storing information, thus directly treating information as a physical phenomenon. There is a fundamental ontological continuity between the biological processes and the human economy, as both are seen as information processing and entropy producing systems. Knowledge and energy are not substitutes, with energy and information being two aspects of the same underlying physical process